MRSA variant has entered food chain

Thanks, BigAgra!

Source: Martin Hickman, The Independent.

British people have been infected for the first time by an animal variant of MRSA, the hospital superbug that infects more than 4,000 patients a year.

Scientists revealed yesterday that three patients in separate hospitals were infected with the ST398 strain, which is found in factory-farmed pigs in the Netherlands. None of the humans had a close association with farm animals, raising the possibility that the superbug has entered the food chain.

Most cases of the ST398 strain have been spread to people in close contact with animals such as farmers, vets and abattoir workers, but cooks may be infected if bacteria on their hands entered a cut or a wound.

MRSA has been found in pigs in the Netherlands, Denmark, Belgium and Germany and in other farm animals such as chickens and cattle. The strain – which has caused skin infections and rare heart and bone problems in humans – is believed to have spread among pigs that were fed antibiotics to spur growth and protect them from disease. A survey by the Dutch authorities in 2006 found traces of the bug in 20 per cent of pork products, 21 per cent of chicken meat and 3 per cent of beef.

No cases have been found in UK livestock but the Soil Association called for Britain to start testing meat because two-thirds of Britain’s pork is imported from Holland. Professor Richard James, of the Centre for Healthcare Associated Infections at Nottingham University, backed the call. “It is a concern. We need people testing pork to see if it’s there,” he said.

The Food Standards Agency said that the bug should be eradicated by good hygiene and urged people to wash their hands and surfaces after handling meat.

All three patients, who were being treated in at least two different Scottish hospitals, recovered. Confirming the cases, Dr Giles Edwards, director of the Scottish MRSA Reference Laboratory, said: “A lot of the patients who got this infection in Holland and Canada have been people who work with animals, such as farmers and vets. But none of the three individuals in Scotland have been in contact with animals, not that we could find.”

The Soil Association called on the Department for Environment, Food and Rural Affairs to publish interim results of its testing for MRSA in pigs. “We suspect that MRSA has now been found in British pigs,” said the policy adviser, Richard Young.

“ST398 is no more serious than existing strains of MRSA, but it is resistant to different antibiotics, and where it is present it will make it harder for doctors to select an effective drug quickly. In some cases, that could be the difference between life and death.”

The Food Standards Agency said it did “not see serious food safety issues”. It advised cooks to wash their hands thoroughly; to cook and chill food properly; and avoid cross-contamination.

Media Betrays America – Again: Impeachment “Off the Table” @ USA Corp

Source: TopCat, Thisisby.us.

“It is possible to fool all of the people all the time; when government and press cooperate.”
GEORGE SELDES (legendary investigative reporter, 1938)

“The business of the journalist is to destroy the truth; to lie outright; to pervert; to vilify; to fawn at the feet of Mammon, and to sell the country for his daily bread… We are the tools and vassals of the rich men behind the scenes. We are the jumping jacks, they pull the strings and we dance. Our talents, our possibilities and our lives are all the property of other men. We are intellectual prostitutes.”
JOHN SWINTON (former Chief of Staff New York Times in his toast to the New York Press Club. Quote1880)

“Those who manipulate the unseen mechanism of society constitute an Invisible Government which is the true ruling power of our country. We are governed; our minds molded, our tastes formed, our ideas suggested largely by men we have never heard of.”
EDWARD L. BERNAYS (Sigmund Freud’s nephew and the father of psyops, mass spin control and modern propaganda. Bernay’s techniques sold WWI to Americans thru the “Committee on Public Information”. Josef Goebbels as Hitler’s Minister of Propaganda was an avid fan of Bernay’s work for the Third Reich. Bernays partnered with William Paley to run CBS. Edward Bernay’s work was also the foundation for CIA mass media manipulation via “Operation Mockingbird”. Quote: Bernay’s book “Propaganda” published 1928)

“Our job is to give people not what they want, but what we decide they ought to have.”
RICHARD SALENT (President CBS “News” division 1961-64 & 1966-79)

“News is what someone wants to suppress. Everything else is advertising.”
REUVEN FRANK (President NBC “News” from 1968-1972 & 1982-1984)

“You could get a journalist cheaper than a good call girl, for a couple hundred dollars a month.”
PHILIP GRAHAM (editor of the Washington Post quoting his CIA operative source as he discussed the availability and prices of journalists willing to peddle CIA propaganda and cover stories. Quote 1991)

Dennis Kucinich as the lone voice of a nation’s conscience gave reason and clarity to a case for impeachment of GW Bush on June 9th at the capital. Virtually no one from the moral cesspit that is Washington DC was present for the event. Certainly not GOP androids, neocon sellouts, “impeachment-is-off-the-table” Pelosi or any of the usual two-faced corporate circus masquerading as lawmakers.

It goes without saying GW Bush appears a witless rodeo clown for the corporate crime state he was evidently handpicked to gut and rape the country for. However— a Bush puppet presidency does not excuse criminal deeds of his temp stooge regime. By that measure, no representative of the national media establishment covered the historic event. No national network whether NBC, CBS, ABC, etc, carried this in any way whatever. In fact, no national news provider mentioned the Kucinich phenomenon. If carried at all by any national newspaper, impeachment news was buried as far from page one as possible. (Ditto for coverage of the Senate Intelligence Committee’s report on the administration’s misuse of prewar “intelligence”). So, barely a whisper to mark the act. Practically nothing and no one at the MSM recorded the event never mind reporting it for broadcast or print.

For to present the case for impeachment as national “news” would have given Kucinich’s message significance and power. A corporate monopoly rigged MSM would make such an event one to avoid at all costs.

The purpose and reason for such corrupted MSM policy? To blackout and thus trash the impeachment case accomplishes one thing above all:

To break the American will by keeping the sheep in the dark and on the plantation. So do we get a population of patsies Eveready to be gutted and raped by the next corporate crime lapdog regime. Thus are the ignorant with the gullible paralyzed, to be kept so for permanent and vast power grabs foisted at false 9/11“war on terror” of a thousand lies.

The first 8 articles of Impeachment set the stage as others follow suite…

Article I
Creating a Secret Propaganda Campaign to Manufacture a False Case for War Against Iraq.

Article II
Falsely, Systematically, and with Criminal Intent Conflating the Attacks of September 11, 2001, With Misrepresentation of Iraq as a Security Threat as Part of Fraudulent Justification for a War of Aggression.

Article III
Misleading the American People and Members of Congress to Believe Iraq Possessed Weapons of Mass Destruction, to Manufacture a False Case for War.

Article IV
Misleading the American People and Members of Congress to Believe Iraq Posed an Imminent Threat to the United States.

Article V
Illegally Misspending Funds to Secretly Begin a War of Aggression.

Article VI
Invading Iraq in Violation of the Requirements of HJRes114.

Article VII
Invading Iraq Absent a Declaration of War.

Article VIII
Invading Iraq, A Sovereign Nation, in Violation of the UN Charter.

Some would say there is an article missing in one proven and officially unchallenged criminal 9/11 coverup. With that reservation, the articles speak volumes where silence from America is deafening.

Others would say that Kucinich, former candidate for the presidential ticket is not glamorous, famous, nor handsome enough to warrant coverage for such effort. I would suggest these would be the most benighted and clueless of what passes for Americans.

Whether you ID yourself at the fictional “left” “right” or “center” under de facto Fascist rule, Dennis Kucinich presenting 35 articles of impeachment signifies real news with a capital “N”. To ignore the event as if it never occurred can mean the obvious:

The mono-channel American Mockingbird machine is manifestly corrupt, to be bought and paid for as it has been for generations. From military propaganda down – western and U.S. media has shown itself to be an instrument of organized information warfare on Americans and the world.

At USA Corp, it seems only ne[o]con charlatans or Big Oil tricksters now deny a treacherous MSM monolith sold sham 9/11 “war on terror” for the world to buy. Even so, never has the 4th estate been more clearly Fascist or transparently dirty.

Health officials crack down on raw milk

When they have a crack down on salmonella tomatoes and mad cow beef, I’ll believe that they care about the nation’s food safety.

By PAUL ELIAS, Associated Press Writer.

SAN FRANCISCO – Dairy owner Mark McAfee started selling raw milk in 2000, marketing it to customers who believe it contains beneficial microbes that treat everything from asthma to autism.

The unpasteurized milk swiftly caught on as part of the growing natural food movement. But the Food and Drug Administration considers McAfee a snake oil salesman and recently launched an investigation into whether his dairy illegally shipped raw milk across state lines. The agency even tried to recruit one of his employees to secretly record conversations with him.

Comment: Snake oil salesman?! That’s professional. Guess they’ve still got their panties in a wringer since the FDA goons couldn’t get McAfee’s employees to wear a wiretap or nark on him!

The case against McAfee is part of a crackdown on raw milk by government health officials who are concerned about the spread of food-borne illnesses. Lawmakers and law enforcement agencies are stepping up efforts to keep unpasteurized milk out of reach, even as demand for the niche product grows.

Comment: Why are they stepping up the efforts just when people want them in larger numbers? At whose behest are they stepping up these efforts, Big Dairy?

McAfee, who was among the first in to sell raw milk on a large scale, brushed off the investigation: “When you’re a pioneer, you have to expect to take a few arrows.”

Twenty-two states prohibit sales of raw milk for human consumption, and the rest allow it within their borders. The FDA bans cross-border sales.

In Pennsylvania, local officials recently busted two dairies unlawfully selling milk straight from the cow.

And in Maryland, health officials issued an emergency ban late last year on “cow-sharing” agreements, claiming they were aimed at skirting a ban on raw milk sales.

“Raw milk should not be consumed by anyone for any reason,” said John Sheehan, head of the FDA’s dairy office. “It is an inherently dangerous product.”

Comment: You keep saying that but no one believes you anymore; in fact every time you spout these dire comments, you just drive more people to the store and/or farm to see what they’re missing. Mark must love you guys!

But shutting down sales is tricky because the federal government has largely let states regulate the raw milk industry. The result is a hodgepodge of laws that confuse consumers, dairy farmers and regulators alike.

McAfee said he expects the FDA’s criminal probe to be dropped without charges in a deal that will require him to guarantee his interstate shipments are for use only as pet food. The FDA declined to comment.

Raw milk proponents insist they are under siege by state and federal regulators intent on snuffing out the industry.

The popularity of raw milk is fueled by consumers’ concerns about the chemicals and hormones used in traditional dairy farming, and a growing interest in unprocessed, organic foods.

Devotees of raw milk ascribe to it almost mythical healing powers. They feed it to babies, believing it strengthens the immune system and staves off digestive troubles. The heat used in pasteurization, they say, kills healthy natural proteins and enzymes.

“It’s a magic food,” said Sally Fallon, president of the Weston A. Price Foundation, a nonprofit that advocates consumption of natural foods.

The FDA insists pasteurization destroys harmful bacteria without significantly changing milk’s nutritional value. The process also extends its shelf life.

Comment: That’s why Big Dairy pasteurizes milk—not because it cares about your health!

Nevertheless, some consumers have formed cooperatives to support dairy farmers who offer raw milk. They also join “cow-sharing” programs in which farmers take care of cows that are “leased” by consumers.

Food safety officials say raw milk has sickened hundreds of people with salmonella, E. coli and other bacteria. According to the Centers for Disease Control and Prevention, 1,000 people fell ill from raw milk between 1998 and 2005. Two died.

Comment: And how does that stack up against other salmonella and E. coli-infected foods? Hundreds of people were sickened and four children died during the Jack in the Box Hamburger Contamination alone. Did the FDA thugs harrass executives and shut down the business? Of course not. This hypocrisy speaks volumes about their objectivity.

The FDA ban on cross-border sales of raw milk led to its criminal investigation of Organic Pastures, a Fresno dairy owned by McAfee that is California’s largest raw milk supplier.

The agency ordered two of McAfee’s employees to testify before a grand jury and offered to pay one of them to surreptitiously record her conversations with McAfee, according to the worker.

“The main issue was selling our products outside the state of California,” said dairy worker Amanda Hall, who refused to wear the wire. The two workers’ grand jury appearances were canceled last month.

Even if McAfee avoids criminal charges, he still faces lawsuits filed by the families of five children who claim his raw milk made them seriously ill.

He denies the allegations and said testing at his dairy did not detect the strain of E. coli that sickened some of the children.

McAfee also is challenging a new California law requiring lower bacteria levels in raw milk. He fears the change will put him out of business. A judge in San Benito County last month ruled for the state, but McAfee appealed the decision on Thursday. Also, a state senator plans to introduce a bill to repeal the law.

Whole Foods Co. lobbied for a law that ensure raw milk dairies can stay in business.

“It is a growing piece of our business,” said Walter Robb, the company’s co-president. “We want to protect consumer choice.”

He and other raw milk proponents argue that the FDA should spend its time working on other agricultural practices that jeopardize food safety, such as the way large farms confine animals.

But parents like Melissa Herzog strongly disagree.

Herzog, whose 10-year-old daughter spent two months in the hospital after her kidneys failed because of E. coli poisoning, is one of the families suing Organic Pastures over the 2006 outbreak that health officials determined was probably caused by raw milk from the dairy.

“I don’t have anything good to say about raw milk,” she said. “It was a horrible experience.”

FEMA gave away $85 million of supplies for Katrina victims

Source: Abbie Boudreau and Scott Zamost, CNN.

NEW ORLEANS, Louisiana (CNN) — FEMA gave away about $85 million in household goods meant for Hurricane Katrina victims, a CNN investigation has found.

The material, from basic kitchen goods to sleeping necessities, sat in warehouses for two years before the Federal Emergency Management Agency’s giveaway to federal and state agencies this year.

James McIntyre, FEMA’s acting press secretary, said that FEMA was spending more than $1 million a year to store the material and that another agency wanted the warehouses torn down, so “we needed to vacate them.”

“Upon review of our assets and our need to continue to store them, we determined that they were excess to FEMA’s needs; therefore, they are being excessed from FEMA’s inventory,” McIntyre wrote in an e-mail.

He declined a request for an on-camera interview, telling CNN the giveaway was “not news.”

Photos from one of the facilities in Fort Worth, Texas, show pallet after pallet of cots, cleansers, first-aid kits, coffee makers, camp stoves and other items stacked to the ceiling.

FEMA said some of the items were donations from companies after Katrina, but most were purchased in the field as “starter kits” for people living in trailers provided by the agency. And even though the stocks were offered to state agencies after FEMA decided to get rid of them, one of the states that passed was Louisiana.

Martha Kegel, the head of a New Orleans nonprofit agency that helps find homes for those still displaced by the storm, said she was shocked to learn about the existence of the goods and the government giveaway.

“These are exactly the items that we are desperately seeking donations of right now: basic kitchen household supplies,” said Kegel, executive director of Unity of Greater New Orleans. “These are the very things that we are seeking right now. FEMA, in fact, refers homeless clients to us to house them. How can we house them if we don’t have basic supplies?”

Kegel’s group works with FEMA and other local organizations to rehouse victims of Katrina, the 2005 hurricane that flooded New Orleans and killed more than 1,800 people along the Gulf Coast. Community groups say thousands of people are still living in abandoned buildings in the city, though fewer than 100 people remain housed in tents.

Kegel said FEMA was told in regular meetings that Unity was desperate for household supplies and that the group has been forced to beg for donations. But she said FEMA never told Unity and other community groups that it had tens of millions of dollars worth of brand-new items meant for storm victims.

She said she learned of it from CNN, which found that those items never made it to people such as Debra Reed.

“An honest person like me didn’t get nothing,” said Reed, 54, who recently moved from a tent beneath a New Orleans bridge to a home with the help of Kegel’s group. “I’m gonna turn, ’cause I’m gonna cry. I didn’t get nothing. I fought to get my money, but they wouldn’t give it to me. So I ended up going under the bridge.”

FEMA confirmed that it had kept the merchandise in storage for the past two years and then gave it away to cities, schools, fire departments and nonprofit agencies such as food banks. In all, General Services Administration records show, FEMA gave away 121 truckloads of material.

McIntyre said that most of the items given away were not “standard-issue type supplies” that FEMA would have distributed after other disasters. He said that using the GSA, which manages federal property, to get rid of those stockpiles was “standard process.”

Asked whether FEMA believed that Katrina victims no longer needed the items, McIntyre wrote: “If the state did not request the supplies, then FEMA would not know.”

Pallets at the Fort Worth warehouse were piled high with boxes of buckets, boots, cleansers, mops and brooms. There were stacks of tents, lanterns and camp stoves for people still displaced, as well as clothing, bedding, plates and utensils.

Meanwhile, Kegel said, Unity’s clients can take only “one fork, one spoon, one knife; they can only take one plate. We don’t have enough to go around.”

But FEMA said the items were no longer needed in the stricken region. So it declared them “federal surplus” and gave them away.

Federal agencies such as the Bureau of Prisons, Postal Service and Border Patrol got first dibs on the material when FEMA started giving it away. Other agencies that received items include the National Guard, U.S. Marshals Service, the Air Force and Navy and the departments of Agriculture, Veterans Affairs and Homeland Security, according to a list the GSA provided to CNN.

These items also were offered to all states — yet Louisiana, where most of the people displaced by the storm live, passed on taking any of them.

John Medica, director of the Louisiana Federal Property Assistance Agency in Baton Rouge, said he was unaware that Katrina victims still had a need for the household supplies.

“We didn’t have anybody out there who told us they wanted it,” Medica said.

Instead, 16 other states took the free items.

Kegel said she could not understand how Medica could not be aware of the need in the New Orleans area.

She said she had not heard of the agency and was not registered with them, but after CNN’s interview, the agency contacted her about registering Unity of Greater New Orleans so it could qualify for available supplies in the future.

Bob Chapman: What Really Drives The Markets

Source: Bob Chapman’s The International Forecaster.

Constant manipulations, not much strength left in the dollar, fear of inflation, Fed hiding data, offers excuses, toxic waste derivatives in the balance, the worst is not behind us, precious metals suppression

Commentators cannot yet wrap their minds around what really drives our markets. Not only are our various stock, bond, derivative and commodity markets no longer free due to their 24/7 molestation at the hands of the PPT [Working Group on Financial Markets aka Plunge Protection Team], they are manipulated in diabolical ways to hide the destruction of our economy, and also to throw people off the trail of cause and effect. Take the recent dollar rally for example. Everyone seems to think that the dollar is rising based on statements from Fed Head Bernanke that he is worried about inflation and that this might mean future Fed actions will support the dollar. No one who is informed really believes this. The true cause of the dollar rally was a gargantuan increase of 14,393 contracts of open interest in USDX futures in one day, this Tuesday.

This had “PPT” written all over it, and resulted in a single day increase in open interest of 37.35% from 38,127 contracts to 52,520 contracts, the highest level of open interest since March 18, almost three months ago. This was the true cause of the dollar rally. Ben’s comments were just a pretense to give credence to the dollar rally and to throw people off the trail of the real culprit, the PPT, that was behind the phony dollar rally. The PPT is the only market “fundamental” lending strength to the dollar. And the phony dollar rally, supposedly based on Helicopter Ben’s phony jaw-boning, was used to justify the PPT’s sales and leasing of gold and silver as well as their naked-shorting of resource stocks which sent gold down by 26+ dollars per ounce and the HUI down by 25+ points, all in a single day. This was not normal market action, this was PPT-manipulated action.

While we are certain that Ben is worried about inflation, he is worried about saving the Wall Street fraudsters even more, and this despite the fact that these fraudsters, who acted under the direction and supervision of the Illuminati, are responsible for all the current market predicaments. That is, of course, because Uncle Ben is one of them, and takes his marching orders from the head Illuminists, just like Mr. Bubbles, Alan Greenspan, did during his tenure as Fed Head. The Fed is worried only about Illuminist insiders. They could care less about non-insiders, like the sheople, who can starve and go bankrupt and lose their homes for all they care. Basically, Ali Baba will now attempt to save his Forty Thieves.

If everyone is so worried about the dollar, then why has the Department of Commerce recently decided to discontinue publishing its reports on foreign investment data, citing funding limitations as the reason? Gee, isn’t that the same reasoning we heard from the Fed for its discontinuance of the M3 report? Apparently, the government is expecting an avalanche of foreign investment similar to the avalanche of money and credit that the continued publication of M3 would have exposed. But such an avalanche would not be anticipated if the dollar were about to be substantially strengthened. Instead, the discontinuance of the foreign investment report clues us into the reality that our dollars are about to be flushed down the toilet, a fact which is well known to insiders, and which is especially well known to those who own large piles of those dollars, like China, Japan, Russia, Saudi Arabia and other big dollar forex holders.

These large dollar forex owners, at least those who are Illuminist insiders, have probably just been given the word by the Illuminati that the destruction of the dollar is imminent, and they will all now desperately attempt to transform their paper holdings into tangible real assets before the axe falls on the dollar and it plummets to new lows.

Once the forex insiders start their move, the non-insiders will jump on the bandwagon to avoid getting screwed, and the dollar will drop so fast it will make your head spin, as will the dramatic rise in inflation that will result as all those exported dollars make their way back to our domestic economy. It’s going to get really ugly for the dollar once that process commences. The timing is hard to predict, but our guess would be that this process will start in earnest after the November elections, assuming we have them. The government wants to cover up the resulting huge influx of foreign capital because they do not want you to know, until it is too late to do anything about it, that they are going to trash the dollar to make way for the Amero and the North American Union as a regional stepping stone to a one-world currency and a one-world government.

We can assure you that Buck-Busting-Ben will do just that as soon as the next debacle hits for the Wall Street fraudsters who engineered the subprime debacle. He’ll lower interest rates again sooner than you can say “rate cut” when this next round arrives, which is why he decided to stop at two percent. He knows that much worse problems are coming down the line, and that the next time the system could irreparably implode if he has nothing left to work with. What he probably does not know for sure, yet, is that the next round of real estate problems will destroy the system, will turn the dollar into a carry trade currency and will wipe out what is left of the Fed’s general collateral, meaning that all remaining Fed-owned treasuries will have to be loaned out in exchange for toxic waste to keep the system from imploding.

The fraudsters on Wall Street have still only written off less than half of their current losses and even greater losses are on the way as the next round of real estate foreclosures, which will include jumbo, negative amortization, Pick-a-Pay loans, make their way into the statistics. There are hundreds of billions worth of toxic waste derivatives being held in off-balance sheet VIE’s (Variable Interest Entities). This is toxic waste that the fane-stream media has not told you about yet and that is still waiting to find its way back to bank balance sheets as SIV’s (Structured Investment Vehicles) give way to VIE’s as the debacle du jour. This transpires as suicidal builders continue to increase new home inventories in the face of rising commodity prices, plummeting real estate prices and glutted used and new home inventories. And then there are the people who are getting ever more backward on their equity at the rate of 14% per annum according to Case-Schiller, a situation sure to accelerate the number of borrowers who chose to default and send their “jingle mail” to the bank.

First time buyers have been cut off from purchasing homes by more stringent credit and down payment requirements and by an increasing sense that they will get in much cheaper if they wait. They are the ones who start out most closing chains of interlinked sales, which means that people who currently own their own homes can not move up or find a buyer if they have to leave the area. The entire real estate market is in a complete lock-up which will get worse as real interest rates continue to rise with the increased risk that comes in the wake of each new default debacle, such as defaults in consumer debt like credit cards, car loans and student loans, to name but a few. Those who think the worst is behind us are either in denial or live on another planet.

Let’s take a look at what is happening to the last great bastion of American middle class wealth, which is of course their real estate. Their stocks and bonds and pension funds have already been pulverized. Now they watch as their home prices plummet at the rate of 14% per annum, while inflation rages at over 12%, thereby reducing what remains of their real estate value after real estate market losses are applied. Let’s assume that at the beginning of 2007, you had a home worth one million. Three years from now, at the beginning of 2010, in terms of 2007 dollars, you would only have purchasing power of 405,224 dollars left out of your real estate nest egg that was worth 1,000,000 dollars in the year 2007, calculated as follows: $1,000,000 x the cube of (1 – .14 – .12) or .74 cubed. That 26% haircut each year could become much worse if inflation or housing take a turn for the worse, which is very likely, especially in the case of inflation which should reach 18% or more during 2009. Now you see where you are headed, and this has been by the design of your government, Wall Street and corporate America under the direction of the Illuminati. Even worse losses are possible than those illustrated, depending on how all the various debacles turn out. You are looking at a blood bath beyond your wildest imagination. So load up on gold, silver and their related shares or prepare to get taken to the cleaners in Locksley Hall.

Note how the cartel’s Illuminists are trying to run up oil while suppressing gold. They want oil to be a counterbalance to gold instead of being a supporter of gold. The next time you see substantial dollar weakness, you can count on oil to drop like a rock, if only temporarily, to put a hit on gold. The PPT’s blowout of oil shorts that were being used by specs to protect gold positions and that pushed oil up dramatically by forcing massive short-covering, has quickly run its course and oil has settled back down again to keep pressure on the metals after the shorts were destroyed. Also, note how massive continuing manipulations of silver and resource stocks, which are fairly small markets overall, are being used by the PPT to portray a situation of non-confirmation for gold. Silver is getting leased to death through negative short-term lease rates and resource stocks are getting pounded by naked-shorting. This will keep the metals subdued until the next debacle hits, which will be bank failures and much higher inflation statistics, coupled with more real estate fallout and possible credit default swap problems. The cartel is now so short on silver that they are illegally rationing Silver Eagles to dealers and starving the public demand so they do not have to go into the silver market and run the price up. Welcome to corporatist, fascist America.

To give you some idea of how desperate the general stock markets have become, let’s look at the yen’s movement versus the Dow. When the Dow closed at 13,020.83 on May 6, the yen closed at 104.54 yen per dollar and 162.539 yen per euro. On Tuesday, June 10, with the Dow at 12,289.76, the yen closed at 107.19 yen per dollar and 165.855 yen per euro. Not even the carry traders can keep these hapless markets up, and we suspect that there is heavy de-leveraging going on. Note how gold and silver, which usually benefit from a weaker yen, have been unable to take advantage of this current expression of yen weakness, which shows you how rampant the suppression of precious metals is right now. The stock market situation has gone from scary to outright frightening. Do not go anywhere near the general stock markets, unless you like losing lots of money

Our president informed us this past week that all is well with our economy. He must live in a different world than we do. The evidence of recession is everywhere as families try their best to preserve their purchasing power. We are told inflation is some 4%. The shoppers know this is untrue as they struggle in a world of hyperinflation. Their dollar is losing buying power against almost every world currency. There are tent cities stretching across our land in parking lots and in parks, a legacy of our Federal Reserve, a private corporation legislated long ago in 1913 for the further enrichment of our Illuminist elite, so that they may rule our lives. Wages are stagnant, a benefit of unbridled legal and illegal immigration, free trade, globalization, offshoring and outsourcing as the elitist transnational conglomerates destroy our economy and our culture. We are facing an economy comparative to 1930, where eventually one-third of our population will be living like beasts in tent cities. Were it not for the creation of more than $1 trillion in money and credit to the financial industry our economy would have already collapsed – eventually it will. Our dollar is being supported by foreign central banks and in the end they will own all of our assets. As the dollar collapses further these creditors will demand everything we own.

Wall Street, corporate America, our media, the Federal Reserve and our government tells us the worst is over. This is only the beginning of the beginning. Stocks and bonds are falling and markets in municipals, corporate bonds, CDOs, SIVs and ABSs are virtually frozen. Wall Street profits are falling by two-thirds and we are just getting underway. Over the next few years at least 300 of American banks will fail, along with millions of businesses. Unemployment now at 14% will rise to 35%. Yes, it is going to be that bad. Housing will continue to collapse, as will commercial real estate, which is already virtually frozen. What does it tell you when government has to bring 35 bank bankruptcy specialists out of retirement, some of whom are in the 80s, to sort out the coming banking collapse?

The commodity market and gold and silver are booming just as we forecast. As a result, raw material costs have skyrocketed adding to the pull of inflation. If corporations do not pass along these added costs to the consumer, profits will collapse and layoffs will ensue. If profits fall share prices will fall and the whole stock market will fall.

A NATIONAL POLITICAL BROWNOUT, PART I

By Dr. Marc Faber, via The Daily Reckoning.

Although I don’t always agree with the views of columnist Thomas Friedman, I couldn’t agree more with his criticism of US energy policies. In a recent article entitled “The energy to be serious”, he takes Hillary Clinton and John McCain to task for their suggestion that the federal excise tax on gasoline be suspended this summer

According to Friedman, “It is great to see that we Americans finally have some national unity on energy policy. Unfortunately, the unifying idea is so ridiculous, so unworthy of the people aspiring to lead the United States, it takes your breath away.

“Hillary Clinton has decided to line up with John McCain in pushing to suspend the federal excise tax on gasoline, 18.4 cents a gallon, for this summer’s travel season. This is not an energy policy. This is money laundering: We Americans borrow money from China and ship it to Saudi Arabia and take a little cut for ourselves as it goes through our gas tanks. What a way to build a country.”

When the summer is over, we will have increased our debt to China, increased our transfer of wealth to Saudi Arabia and increased our contribution to global warming for our kids to inherit.

No, no, no, we’ll just get the money by taxing Big Oil, says Clinton. Even if we could do that, what a terrible way to spend precious tax dollars – burning it up on the way to the beach rather than on innovation.

The McCain–Clinton gas holiday proposal is a perfect example of what energy expert Peter Schwartz of Global Business Network describes as the true American energy policy today: “Maximize demand, minimize supply and buy the rest from people who hate us the most.” …

Few people know it, but for almost a year now, Congress has been bickering over whether and how to renew the investment tax credit to stimulate investment in solar energy and the production tax credit to encourage investment in wind energy. The bickering has been so poisonous that when Congress passed the 2007 energy bill last December, it failed to extend any stimulus for wind and solar energy production.

Oil and gas kept their credits, but those for wind and solar have been left to expire this December… These credits are critical because they ensure that if oil prices slip back down again – which often happens – investments in wind and solar would still be profitable. That’s how you launch a new energy technology and help it achieve scale, so it can compete without subsidies… It is so alarming, says Rhone Resch, the president of the Solar Energy Industries Association, that the U.S. has reached a point “where the priorities of Congress could become so distorted by politics” that it would turn its back on the next great global industry – clean power – “but that’s exactly what is happening.”…

While all the presidential candidates were railing about lost manufacturing jobs in Ohio, no one noticed that America’s premier solar company, First Solar, from Toledo, Ohio, was opening its newest factory in the former East Germany – 540 high-paying engineering jobs – because Germany has created a booming solar market and America has not. [Germany and Japan have, respectively, 20- and 12-year solar incentive programs in place – ed. note.] In 1997, said Resch, America was the leader in solar energy technology, with 40% of global solar production. “Last year we were less than 8% and even most of that was manufacturing for overseas markets.”

The McCain–Clinton proposal is a reminder to me that the biggest energy crisis we have in our country today is the energy to be serious – the energy to do big things in a sustained, focused and intelligent way. We are in the midst of a national political brownout.

At about the same time, John Gapper, writing for the Financial Times, lamented the poor state of US infrastructure in an article entitled “On the pot-holed highway to hell”:

“If anyone doubts the problems of US infrastructure, I suggest he or she take a flight to John F. Kennedy airport (braving the landing delay), ride a taxi on the pot-holed and congested Brooklyn–Queens Expressway and try to make a mobile phone call en route. That should settle it, particularly for those who have experienced smooth flights, train rides and road travel, and speedy communications networks in, say, Beijing, Paris, or Abu Dhabi recently. The gulf in public and private infrastructure is, to put it mildly, alarming for US competitiveness…

“Faced with the emptying of the Highway Trust Fund, established in 1956 as the US entered a period of growth and prosperity, Mrs. Clinton suggested cutting its source of funds (which she claimed could be made up by a tax on oil companies)… At times I wonder whether the world’s biggest economy has the will to solve its challenges or will end up wandering self indulgently into the minor economic leagues. I expect it will get serious when the crisis is too blatant to ignore, but it has not done so yet.

“Perhaps this is a bit unfair. Some leaders have recognized the problem for economic development, as well as for safety. They include Arnold Schwarzenegger and Ed Rendell, governors of California and Pennsylvania, and Mayor Michael Bloomberg of New York. The trio have allied to press for the states and Washington to act.”

Gapper then quoted Ed Rend, incidentally one of Mrs. Clinton’s biggest supporters, who supported her initiative to suspend the “gas tax” and increase taxes on oil companies (a really bad idea, since higher oil company taxes will curtail exploration). “Dams are in a horrible condition … we have no real rail transport, unlike most nations in the world… Summer delays make flying in America a disaster,” Rendell said.

According to Gapper, “…there are lots of ways in which infrastructure inadequacy matters to the US but I would focus on two.

“First it imposes a drag on economic growth. The private infrastructure is poor enough – broadband speed lags behind other countries and mobile coverage is spotty. But much of the public infrastructure is unfit, a fact that was becoming clear even before Hurricane Katrina flooded New Orleans and a Minneapolis bridge collapsed during rush hour last year.

“Second, it presents an awful image of the US to investors and other visitors. The state of transport and communication infrastructure is a symbol of a nation’s economic development and the US is starting to look like a third world country. In fact, scratch that. Many developing countries look and feel better. Of course they are in a different phase of development. The US invested 10% of its federal non-military budget in infrastructure in the 1950s and 1960s as it built the interstate highway system – at the time, the envy of the world. While the US investment has fallen to less than 1% of gross domestic product, China has been matching its double-digit postwar record… Americans may not like the sound of that, but they cannot expect the US to maintain the economic dynamism of the late 20th century in the 21st unless they buckle down. Sooner or later, wishful thinking is going to crash into financial reality.”

In a column for the New York Times , Thomas Friedman noted that Americans really “want to do nationbuilding” – not in Iraq and Afghanistan, but in America.

According to Friedman, “We are not as powerful as we used to be because over the past three decades, the Asian values of our parents’ generation – work hard, study, save, invest, live within your means – have given way to subprime values: ‘You can have the American dream – a house – with no money down and no payments for two years.’ …

“A few weeks ago, my wife and I flew from New York’s Kennedy Airport to Singapore. In J.F.K.’s waiting lounge we could barely find a place to sit. Eighteen hours later, we landed at Singapore’s ultramodern airport, with free Internet portals and children’s play zones throughout. We felt, as we have before, like we had just flown from the Flintstones to the Jetsons. If all Americans could compare Berlin’s luxurious central train station today with the grimy, decrepit Penn Station in New York City, they would swear we were the ones who lost World War II.

“How could this be? We are a great power. How could we be borrowing money from Singapore? Maybe it’s because Singapore is investing billions of dollars, from its own savings, into infrastructure and scientific research to attract the world’s best talent – including Americans…

“And us? Harvard’s president, Drew Faust, just told a Senate hearing that cutbacks in government research funds were resulting in ‘downsized labs, layoffs of post docs, slipping morale and more conservative science that shies away from the big research questions.’ Today, she added, ‘China, India, Singapore … have adopted biomedical research and the building of biotechnology clusters as national goals. Suddenly, those who train in America have significant options elsewhere.’”

I have quoted Friedman and Gapper extensively for several reasons. I have been accused of being anti-American, and therefore I wanted to show our readers that there is an increasing body of Americans who are very concerned about their country’s misguided fiscal and monetary policies, which are designed to boost consumption not only of oil, but of everything else as well, at the expense of capital investments, and research and development spending, which are badly needed if the US wants to regain its competitiveness.

Regards,

Dr. Marc Faber
for The Daily Reckoning

Editor’s Note: Dr. Marc Faber is the editor of The Gloom, Boom and Doom Report and author of Tomorrow’s Gold , one of the best investment books on the market.

Wexler Co-Sponsors Kucinich’s Articles of Impeachment

Source: Meryl Ann Butler, OpEdNews.com.

On Tuesday June 10th, Congressman Robert Wexler (District 19, FL) announced that he “enthusiastically” co-sponsored Kucinich’s bill of Articles of Impeachment against President Bush, saying, ” I am grateful for Dennis’ leadership on this issue and for the steadfast support that countless Americans have given to both of our efforts to redeem our government and expose the crimes of Bush and Cheney.”

Wexler continued, “The Articles present a stunning narrative of offenses that go well beyond previous crimes committed by any U.S. chief executive. In fact, no President or Vice President in history has done more to undermine our constitution.”

Congressman Wexler serves on the House Judiciary Committee. Wexler also announced that Judiciary Committee Chairman Conyers had met his call to have Former White House Press Secretary Scott McClellan testify under oath.

Wexler also announced on Tuesday that McClellan has agreed to testify, under oath, on June 20th at 10 a.m. Wexler notes, “This will be the first step in what we hope will be ongoing and deepening examinations of the stark evidence and charges against both President Bush and Vice President Cheney.”

Readers can support impeachment hearings at WexlerWantsHearings where the texts for Kucinich’s Articles of Impeachment served to both Cheney and Bush are available.

Manipulated, Corrupted and Unreliable Government Data Points to Hyperinflation

“If conditions get bad enough, voters may respond with their feet, declare a pox on both major parties, and turn to a third alternative around 2010 or 2012.”

We’ll see. It will take a lot to wake the apathy of average Joe. I know plenty of people who haven’t had permanent jobs in years, yet they still aren’t outraged enough to do anything. I think it’s because many are still relying on credit cards and home equity loans. Once those dry up, look out Washington!

Source: Stephen Lendman, The Market Oracle.

Walter “John” Williams thinks out of the box. He makes disquieting reading, but you won’t find him in the mainstream. At least not often. He runs a “Shadow Government Statistics” site with an electronic by-subscription newsletter. Anyone can access some of his data and occasional special reports. They can also assess his reasoning. In his judgment, government data are manipulated, corrupted and unreliable. He’s not alone thinking that.

First, through technical changes over time in how data are collected and/or interpreted. The intent is to portray a more rosy scenario and ignore real world experiences of ordinary people. Calculating the CPI is an example:

– in the 1980s, the Bureau of Labor Statistics (BLS) switched from using house prices to their rental equivalent;

– then a decade ago, BLS made a spurious assumption for reasons other than it stated; it was that consumers substitute cheaper products for ones that have risen in price – such as hamburger for steak or chicken for meat; the idea wasn’t to reflect their buying habits; it was to artificially lower inflation and distort its calculation; and

– BLS has long adjusted prices for quality improvements; it’s called “hedonic adjustment” that, in fact, cooks the books; so if computer speed increases, its cost is lowered proportionally even if its price rises; the same is true for autos with better brakes or other assorted innovations; again the result is distortion, and it affects all sorts of products; as a result, inflation is artificially and fraudulently lowered.

Another example is how federal deficits are calculated. Beginning with Nixon in 1969, a “unified budget” was adopted to artificially lower them by offsetting expenditures with “off-budget” Social Security revenues. The idea was to hide government’s true cost at a time wartime and Great Society spending was high and would later factor into the 1970s and 1980s inflation. If deficits were calculated then and now by GAAP methodology (required of all publicly-traded corporations), they’d be much higher than annually reported – since the 1970s, in multiple trillions of dollars; fiscal alchemy sweeps them under the rug.

A further example was Nixon’s “core inflation” idea. More artificial rigging – to exclude volatile food and energy prices to produce a lower figure. No matter that these items account for a large portion of consumer spending, especially for lower income households.

Others like this are numerous. They all amount to manipulative rigging for political or financial market purposes, and the practice goes back decades. A recent Bush administration one is switching to monthly instead of semi-annual jobs data seasonal adjustments to make the number friendlier. Later on (too late for markets to react) they’re matched against payroll figures for a once a year adjustment and more accurate jobs created or lost reading.

The Clinton administration was also manipulative. In calculating employment, it lowered its monthly household sample from 60,000 to 50,000, reducing it mainly in inner cities. The effect is to artificially lower jobless numbers among blacks, Latinos and the poor overall. The calculation is also rigged by keeping out the 2.3 million prison population. The overall effect is illusion, not reality – to erase “free market” capitalism’s defects and make it look wondrous and beneficial to mankind.

Williams reverse-engineers the GDP, employment and inflation data for more accurate readings. He backs out manipulative changes to produce more valid figures. Take the 5.5% May unemployment rate for example. BLS calculates it on persons who looked for work in the last 30 days. Williams adds those who want to work but gave up in frustration plus people working part-time who want (but can’t find) full-time jobs. Result: real unemployment of over 12%.

The same methodology works for economic growth. The real value of all goods and services produced is lower than official GDP numbers when adjusted for higher inflation. More of it means higher prices, not increased output. It’s how Williams makes his calculation, and he’s worried. He sees inflation rising and a threat of hyperinflation ahead. He highlighted his concern in a recent April 2008 report called “Hyperinflation Special Report” with three dramatic sub-headings:

– “Inflationary Recession Is in Place;

– Banking Solvency Crisis Has Opened First Phase Monetary Inflation;” and

– “Hyperinflationary Depression Remains Likely As Early as 2010.”

Time alone will prove him right or wrong. But given current economic conditions, the financial malpractice that precipitated them, continued mismanagement since then, and resultant dangers they created, it pays to examine his analysis. It’s not for the faint-hearted and hopefully won’t bear out. But it’s happened before at other times in other countries, and when it hits it ruins lives and savings. Is America now headed for that type future? Williams thinks so, and here’s his argument.

He sees the US economy in an “intensifying inflationary recession” heading for “a hyperinflationary great depression.” He expects it as soon as 2010, maybe sooner, and “likely” no later than in a decade. Blame it on reckless monetary and fiscal policy – creating torrents of money, borrowing outsized amounts, and spending ourselves into bankruptcy by supporting short-term “big-monied special interests.”

Things are so out of hand, Williams sees “no way of avoiding a financial Armageddon.” We’re nearly or already bankrupt; are creating money to cover our obligations; the more we print, the more we need; it’s fiat currency unbacked by gold; and every new dollar created dilutes the value of all others in circulation. Double the money supply, and presto – every dollar is worth 50 cents. Double it again, and you get the point. We’ve been doing it for decades, especially since Nixon closed the gold window in 1971.

At some point, the music stops, the dollar collapses, it becomes worthless paper, and related dollar-demoninated paper assets go down with it. Williams quotes a law professor who experienced Weimar Germany’s hyperinflation first hand. It was the worst by far ever recorded. “It was horrible. Horrible! Like lightening it struck. No one was prepared.” Shelves in grocery stores emptied. “You could buy nothing with your paper money.” At the trough in 1923, the mark plunged to an astonishing 4,200,000,000,000 to the dollar.

Can it happen here? It might, and rising world inflation is worrisome. Analyst Bob Chapman’s International Forecaster reports current US inflation at 12.5%; China’s 8.5%; Russia’s 14%; Gulf oil producers on average 12%; India 8%; Indonesia 12%; Brazil 5%; Chile 8.3%; Venezuela 29.3% and Argentina 23%. This likely plays into the European Central Bank’s (ECB) reluctance to cut rates and the Bank of England’s holding off on further ones. It’s also a factor affecting dollar weakness and rising gold prices that hedge against depreciating currencies and geopolitical uncertainties.

Williams is justifiably concerned as inflationary pressures build. First some definitions. Inflation results from a money supply increase that causes prices to rise. Williams refers only to goods and services, not financial assets like stocks and bonds. He also leaves out speculation and market manipulation that’s key to understanding high oil and food prices. Markets don’t move randomly. Big-monied speculators move them, but that’s a separate topic from what Williams addresses.

He mentions various types of hyperinflation. They range from the double or triple-digit kind, several-fold that level, to what happened in Weimar Germany when it went to infinity. Once the genie is unleashed, there’s no telling how bad things may get. Williams sees them getting pretty bad. So much so that dollars get dumped, holders flee to safety, and a downward spiral intensifies with no idea of a bottom.

In his view and others, the culprit is fiat currency, without gold backing. Its worth depends solely on the full faith and credit of the issuing government. Absent that and currencies crash. Print too much of it, and that’s its future. Examine Fed policy under Greenspan and Bernanke, and draw your own conclusions.

They’ve been virtual money-creation machines unmindful of the history they should know. By issuing too much of a good thing for too many years, they fueled asset bubbles. When they burst, they made things worse and may now have headed the economy for collapse. In Williams judgment, America today is no different from other nations in other eras that followed similar policies. They all met the same fate, and today this country has already “obligated itself to liabilities well beyond its ability ever to pay off.” Not a cheery assessment, and he’s not alone believing it.

More definitions:

– Deflation – a decrease in goods and services prices, generally from a money supply contraction;

– Inflation – the reverse of the above;

– Hyperinflation – extreme inflation, as explained above, to a level where money becomes worthless or nearly so; according to Williams, the coming hyperinflation is because of a “lack of monetary discipline formerly imposed….by the gold standard, and a (Fed) dedicated to preventing a collapse in the money supply (and preventing) the implosion of the (ongoing) extremely over-leveraged domestic financial system;”

– Recession – officially defined as two or more consecutive (inflation-adjusted) GDP contracting quarters; many economists don’t agree on this, and some gauge conditions by the relative strength or weakness of industrial production, payroll employment, retail sales, and so forth; add it up and clearly the US is in recession; how bad and for how long will only be known in time;

– Depression – a recession “where (inflation-adjusted) peak-to-trough contraction exceeds 10%; and a

– Great depression – one where the peak-to-trough exceeds 25%. It happened only once so far in US history in the 1930s.

Williams believes the current US contraction is about halfway to becoming a “depression,” but before it ends it may become “Great Depression II” to distinguish it from the earlier one. We’re now in an “inflationary recession,” and available data confirm it – soaring food and oil prices, a weakened dollar, true unemployment over 12%, real inflation nearly as high, weak industrial production, and more. In his judgment, expect worse ahead when added “inflationary effects of soaring broad money growth….start” surfacing later in the year. In his judgment, by year-end 2008, “official CPI” figures should begin showing it.

Current computations cook the books, and not just for inflation. According to Williams, the economy has been in recession since late 2006 when it entered the “second down-leg” of a multiple dip contraction. It began in 1999, then showed up officially in 2001. His current outlook takes account of “further bounces and dips in economic activity.” We may now be in an upward swing before reheading down. It happened during the Great Depression, only to fall to new lows.

Conditions today are hazardous. A major financial crisis precipitated them. Reckless policies caused it. It threatens the solvency of major banks and other financial institutions. It also hurts the greater economy. Solutions – massive liquidity injections, interest rate cuts and reckless deficit spending. Result – financial malpractice for a short-term fix. Consequences – “financial Armageddon” according to Williams.

M3 (the broadest money supply measure) growth is so high that the Fed no longer reports it. Economists like Williams do because it’s crucial to know, and the data he reveals are disturbing – record M3 growth at a near 18% annual pace. Hyperinflationary seeds are now sown. Dollar valuation is falling, and at some point may accelerate when investors flee it for safer havens. The Fed again will respond. More debt will be monetized. It will build over time. Things will get worse and then be exacerbated when the government is less able to meet its obligations. “Therein lies the ultimate basis for the pending hyperinflation,” in Williams’ judgment.

He believes it will morph into a hyperinflationary depression, then a “great depression.” And when it hits, it will be with “surprising speed.” Already disposable income is falling in a weakened economy in crisis. As things worsen, politicians get blamed, and Williams raises an interesting possibility. If conditions get bad enough, voters may respond with their feet, declare a pox on both major parties, and turn to a third alternative around 2010 or 2012. It happened before in our history. The Republican Party is Exhibit A. It was created in 1854 at a time Democrats and Whigs were the two dominant parties. Exit Whigs, and enter Republicans with Abraham Lincoln its first elected president in 1860.

Williams shows US inflation data going back to 1665. It was fairly stable up to the Fed’s 1913 creation. It then began rising and accelerated post-WW II. Government calculations mask it. Alternative ones are more revealing and accurate. Except for minor price declines in 1944 and 1955, the US hasn’t had a deflationary period since the 1930s. Abandoning the gold standard is why. It imposed monetary discipline. Roosevelt went off it in 1933. He had to. The banking system collapsed, money supply imploded, and economic stimulus was needed. It released the Fed to create money freely. Therein lies the problem, and it shows up in the numbers.

Current Fed Chairman Bernanke and Alan Greenspan are students of the Great Depression. “Helicopter Ben” especially vowed never again, and his actions prove it to a fault. He knows the risks and stated them in an earlier speech. He said:

“Like gold, US dollars have value only to the extent that they are strictly limited in supply. But the US government has a technology called a printing press (now its electronic equivalent), that allows it to produce as many US dollars as it wishes.” By doing so, it “reduce(s) the value of a dollar in terms of goods and services” which raises their prices….”under a paper-money system, a determined government can always generate higher spending and hence positive inflation.”

So it has, according to Williams, and it caused a “slow-motion destruction of the US dollar’s purchasing power” since 1933. It shows up in GAAP-based 2007 federal deficit figures – $4 trillion for the fiscal year, not the official $163 fiction reported. Williams estimates total outstanding federal obligations at $62.6 trillion. At least one other economist puts it over $80 trillion. There’s no way to honor this debt level, so the “government effectively is bankrupt.” At that point, it has three choices – default, declare a moratorium, or repudiate the entire amount.

Sooner or later, markets will react. Holders of US debt already are balking, but so far modestly and quietly. Ahead, that may change if dollar valuations plunge. It will force the Fed’s hand. Greater debt monetization will follow. Dollar valuations will sink further, and so forth in a progressive downward cycle to oblivion if Williams is right.

If conditions get severe enough, the Fed can create huge amounts of currency in a few days or weeks – enough to match the dollar’s lost purchasing power in the last 75 years. Combine it with fiscal irresponsibility and imagine the consequences.

Official data alone today are reason for concern – soaring food and oil prices, the dollar near historic lows, money growth at an all-time high, and off-the-charts federal deficits and debt. The trend continues, and it shows up in gold prices – topping $1000, then retreating, but nearly certain to soar way above previous highs on its way to numbers not discussed in the mainstream – $2000 an ounce, $3000? Who knows. Williams sees it “setting new historic highs.”

In 1980, its price hit $850 an ounce. In CPI inflation-adjusted terms, around $2300 an ounce would match it today. But if the government hadn’t cooked the CPI calculation, the number would be about $6250 an ounce. By that standard, gold today is cheap. It’s way below its real 1980 top, and if inflation accelerates as Williams predicts, expect much higher prices as dollars keep deflating.

Under this scenario, the “US government cannot cover (its) existing obligations.” Annual federal deficits are “careening wildly out of control, averaging $4.6 trillion per year for the six years through 2007.” That’s with all unfunded liabilities included like Social Security, Medicare, Medicaid, other social services, debt service and more.

Williams says things are so out of control that “if the government (raised taxes) to seize 100% of all wages, salaries and corporate profits, it still would (show) an annual deficit using GAAP accounting” methods. At the same time, “given current revenues, if it stopped (all) spending (including defense and homeland security) other than Social Security and Medicare obligations, the government still would (show) an annual deficit.” The hole is so deep, it’s impossible to dig out, according to Williams.

But given political realities, officials spend whatever it takes to get elected and keep their jobs. That’s besides foreign wars, limitless corporate subsidies and more. Things, however, won’t improve. They’ll worsen, and that for Williams spells hyperinflation ahead. It’s happening “with the full knowledge of political Washington and the Federal Reserve.” It it weren’t for the US’s “special position,” our debt would likely be rated “below investment grade instead of triple-A.” Longer term bonds are especially risky. At some point, they’ll lose their full value. They also risk default, and that’s besides their loss in dollar terms.

It’s just a matter of time before foreign investors get worried enough to act – buying fewer Treasuries down to none, then followed by redemptions. The Fed will have to compensate. Print more currency, and the problem deepens. Its value declines and inflation accelerates.

Trade policies worsen things. We’re in a global race to the bottom. The once bedrock manufacturing base eroded. It’s now 10% of the economy and falling. Services currently account for around 84% of it and rising. Jobs in all categories are being offshored to low-wage countries. Average inflation-adjusted wages keep declining. Real earnings are below their early 1970s peak. Living standards are falling. Consumer debt is rising to make up the shortfall. Savings are liquidated. Before the housing decline, mortgage refinancing helped when valuations rose. It meant taking on more debt. Fed policy encouraged it. Today’s dilemma “is payback” for unsustainable bubble-creation policies. Recalling a relevant quote: “Things that can’t go on forever won’t.”

Bad policy caused enormous structural change, and trade deficits are part of it. They’ve “risen to the highest level for any country in history.” They’re one more problem for a seriously over-extended economy. It places “the federal government and Federal Reserve in untenable positions, where they cannot easily or rapidly address the underlying problems, even if standard economic stimuli were available.”

Given the federal deficit and out-of-control spending, fiscal policy limits have been reached. The Fed’s in the same bind. It can neither stimulate the economy or contain inflation. Rate cuts have done little. Saving the dollar may require raising them, but that won’t “contain non-demand driven inflation.” It shows up in high food, energy, health care, and companies like Dow Chemical announcing on May 28 that it will raise prices across the board up to 20% to offset increased costs.

More cause for worry, and Williams anticipates depression. Hyperinflation will follow, and it will sink “the economy into a great depression.” It will halt commercial activity. The greater disparity in income, the more negative its consequences. “Extremes in income variance usually are followed by financial panics and economic depressions. US income variance today is higher” than in 1929 and “nearly double that of any other ‘advanced’ economy.”

Federal bailouts have worsened things. Dollar creation exploded. Crisis has been pushed into the future. Its enormity will be far greater, and foreign investors will get stuck with a lot of it. When it arrives in strength, capital outflow will follow, and dollar valuation will plunge with it. Williams believes that “both central bank and major private investors know that the dollar is going to be a losing proposition. They either expect and/or hope that they can get of (it) in time to lock in their profits (or for central bankers) that they can forestall the ultimate global economic crisis” as long as possible.

Dollars are very vulnerable in this environment. If Treasuries are dumped, the Fed will monetize debt to make up the difference. Inflation will then accelerate, multi-trillion dollar deficits will worsen things, and a “self-feeding cycle of currency debasement and hyperinflation” will follow.

Cash as we know it will disappear. A barter system and black market will replace it or possible introduction of a new currency. Since most money today is electronic, not physical, chances of it adapting “are practically nil.” With hyperinflation, electronic commerce would completely shut down and economic collapse would follow. Gold and silver will be invaluable. Holders could exchange them for goods and services.

Physical goods will also be precious for survival and as a medium of exchange. Anything with a long shelf life may be stocked in advance, and providers of essential services could barter them for goods and other services. Forewarned is forearmed. Safety and liquidity are crucial. Anything retaining value is essential. Real estate, other currencies for example. Foreign equities and debt to a small degree because US financial assets hammering will spill everywhere.

With all that to deal with, consider another dilemma – the likelihood of painful political change, civil unrest, disruptive violence, and utter chaos. If Williams is right and hyperinflation arrives, Katie bar the door on what may follow. Revolutions are possible with three notable last century ones to consider – in Russia, Weimer Germany and Nationalist China. In each case, the old order ended, everything changed, but not for the good. How does Williams advise? Evaluate one’s own circumstances, use common sense, and forewarned is forearmed. That will help, but hard times hurt everyone.

Hopefully they won’t arrive, at least not full-blown as Williams predicts. But make no mistake. Excess has a price. The more of it the greater. America has an ocean of it. Sooner or later comes payback. “Things that can’t go on forever won’t.”

By Stephen Lendman

http://sjlendman.blogspot.com

Stephen Lendman lives in Chicago and can be reached in Chicago at lendmanstephen@sbcglobal.net.

Also visit his blog site at sjlendman.blogspot.com and listen to The Global Research News Hour on RepublicBroadcasting.org Mondays from 11AM to 1PM US Central time for cutting-edge discussions of major world and national topics with distinguished guests.

http://www.globalresearch.ca/index.php?context=va&aid= 9229

Stephen Lendman Archive

House to Vote on Sending Impeachment Articles to Committee

Comment from What Really Happened:

“This being an election year, the vote may well be in favor. But once in committee, expect those 35 articles to sit until the very end of the Bush administration.”

Source: Molly K. Hooper, CQ Politics.

House members are set to vote Wednesday on sending articles of impeachment against President Bush to the Judiciary Committee.

The 35 articles were offered by Dennis J. Kucinich , D-Ohio, who has pushed his caucus to do more to challenge the White House regarding the run-up to the Iraq War.

Democratic Party leaders have spent nearly a year and a half reining in their caucus on this topic, determined to show that the party is more focused on getting out of Iraq than on how the nation got into Iraq.

Kucinich argues Bush abused his power “to manufacture a false case for war against Iraq.”

On Monday, Kucinich spent about four and a half hours reading the full impeachment text into the Congressional Record.

Under House rules, the chamber must act on the measure within two days.

Judiciary Chairman John Conyers Jr. , D-Mich., declined to say whether his committee would consider the articles.

Majority Leader Steny H. Hoyer , questioning whether impeachment hearings were the right use of time remaining on this year’s election-shortened calendar, defended Congress’ record on confronting Bush.

“This Congress, for the first time since this president has been in office, is holding him accountable, doing oversight in terms of Iraq and Afghanistan, domestic policy, and international civil liberties and civil rights,” said Hoyer, D-Md.

Although many view a referral to committee as a burial for the resolution, Kucinich insisted that “referring it to committee indicates that there should be hearings on this.”

He said the record to support impeachment is “so voluminous and well-documented” that hearings ought to be held.

Kucinich said he and his staff originally put together 60 articles of impeachment but cut that list to what he described as the “most powerful” allegations.

Food Dyes Linked to Hyper Kids, Group Asks FDA to Ban

I don’t think they should be banned—the best way to get them off the market is to not buy products containing artificial coloring. Vote with your dollars!

There’s plenty of candy and snacks at health food stores that don’t contain food dyes. There’s an M&M knock-off (whose name escapes me right now) made without them.

Be suspicious of foods with dyes added, like butter. It should have a nice yellow color. If it’s dyed, that means it has very little vitamin A (which is standard for butter from factory-farm cows).

Source: Thea Deley, Informity News.

DANGEROUS DYES? A food safety advocacy group claims eight dyes commonly used in food, from Lucky Charms to M&Ms, cause behavioral problems in children. Since the U.S. Food and Drug Administration disputed these claims in the past, it seems unlikely it will ban the artificial colorings.

Monday the Center for Science in the Public Interest formally petitioned the U.S. Food and Drug Administration (FDA) to ban eight food dyes, including the two most common – Red 40 and Yellow 5. The United Kingdom already phased out several of these dyes.

FDA Considers Petition to Ban Artificial Food Colors

The Center for Science in the Public Interest asked the FDA to ban the following dyes:

* Yellow 5
* Red 40
* Blue 1
* Blue 2
* Green 3
* Orange B
* Red 3
* Yellow 6

While the FDA considers the Center’s petition, which could take years, the Center asked the FDA to:

* require products containing the dyes carry a warning about their possible effects
* correct information given to consumers about the dyes’ effect on some children’s behavior
* test neurotoxicity of any new food additives and colors

Red 40 and Yellow 5 are the most common dyes used in foods in the United States.

Kids Fav Foods Colored with Artificial Dyes

Food manufacturers use dyes to simulate fruit or vegetable colors. Here are a few examples:

* Kraft’s Guacamole Dip – green color comes from Yellow 5, Yellow 6 and Blue 1 (not from avocadoes)
* Aunt Jemima Blueberry Waffles – blue color comes from Red 40 and Blue 2 (not blueberries)
* General Mills’ Fruit Roll-Ups – fruity colors come from Yellow 5, Yellow 6, Red 40, and Blue 1 (not from raspberries, strawberries, kiwis, or other real fruits)
* Betty Crocker’s Au Gratin “100% Real” Potatoes – yellow color comes from Yellow 5 and Yellow 6 (not from potatoes)

Food manufacturers often use artificial colors in foods for children, such as cereals and snack foods. Here are a few foods that contain one or more of the disputed dyes:

Cereals:
* Apple Jacks
* Froot Loops
* Fruity Cheerios
* Lucky Charms
* Post’s Fruity Pebbles
* Trix
Candies:
* Starburst Chews
* Skittles
* M&M
* Mars candy bars and other candies

When Great Britain banned artificial dyes, food manufacturers switched to natural colorings. In fact, British versions of the candies listed above all use natural colors.

Here’s another difference: In the United States, McDonalds colors its sundae strawberry sauce with Red 40. In Britain? The sauce’s red color comes from strawberries.

Most artificial dyes come from coal tar and petroleum.

Consumers Drive Food, Say Manufacturers

By petitioning the FDA, the Center for Science in the Public Interest hopes to focus the public on the synthetic food dye issue. Why? Food manufacturers responded to public pressure in the United Kingdom.

When researchers at the U.K.’s Southampton University ran trials with 200 children, they found a link between eating artificially colored foods and acting hyperactive. The U.K.’s Food Standards Agency then recommended that food manufacturers stop using several dyes by the end of 2009.

When Kraft conducted market research in Great Britain, it found Brits worried more about food dyes than Americans. (Americans worry more about calories, fat and salt content.) So, based on its research, Kraft replaced artificial coloring with natural coloring in its food products for Great Britain.

Food Dyes on the Rise

American children eat more artificially dyed foods now than ever before, thanks to the FDA approving increasing amounts of food dyes:

Dye Certified for Food Use
1955 – 12 mgs/person each day
2007 – 59 mgs/person each day

Two psychiatrists, Dr. David Schab of Columbia University and Dr. Nhi-Ha T. Trinh of Harvard University, wanted to find out if artificial food coloring contributes to hyperactivity. They analyzed 15 double-blind placebo-controlled trials evaluating the effects of food dyes on children’s behavior.

“The science shows that kids’ behavior improves when these artificial colorings are removed from their diets and worsens when they’re added to the their diets,” Schab said. “While not all children seem to be sensitive to these chemicals, it’s hard to justify their continued use in foods – especially those foods heavily marketed to young children.” (Center for Science in the Public Interest, 6/2/08)