Tag Archives: new york times

Spotlight Therapy “You ask questions.”

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I dreamed awhile back that I was in a public meeting about the latest GoverCorp outrage (take your pick). I took my characteristic Spotlight Therapy stance, which involves turning the lights on to reveal triangulation tactics.

Afterwards, a 20s-something minority female, eyes shining, came up to thank me. “What for,” I replied. “I don’t accomplish anything.”

“Yes, you do.” she said. “You ask questions.”

“Triangulation” is a term applied to the strategy of playing both ends against the middle. You don’t confront the enemy directly, but go for things that are important to him.  When you turn the lights on, the previously hidden manipulators are exposed.

When the dot.com bubble burst on March 10, 2000, my stock value suddenly shrank below my mortgage debt. At that time I was naïve and inexperienced.  Had I known then what I know now, I would have sold the stock before the bubble burst and paid off the mortgage.  Instead, I trusted a banker and stockbroker who I thought worked for me.  They wiped me out instead.

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I believe it was intentional. This sounds paranoid, but the financial setback started me on a reading tangent that validated my suspicions.  Books like Confessions of an Economic Hit Man, The Robber Barons, The Creature from Jekyll Island: A Second Look at the Federal Reserve, Supercapitalism, Wealth of Nations, Alexander Hamilton, The Whiskey Rebellion, and None Dare Call it Conspiracy,* to name a few—as well as the US Constitution–opened my eyes, and I was horrified.  These writings revealed how boom and bust cycles are created on purpose to consolidate wealth and political power in the hands of relatively invisible insiders.

Desperate people are capable of desperate acts, to save themselves. Perhaps my banker and stockbroker were feeling the squeeze before the bubble actually burst, and trying to save their own skins.

But the practice of trapping individuals and nations in debt has a long history. It gives the lender—the presumed lender, anyway—a strategic advantage in terms of control.  Often the presumed lender, like a bank, is lending other people’s money, called “leverage.” Newspapers like the Wall Street Journal regularly inform their readers how many billions this or that hedge fund or individual controls.

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This is triangulation in action. Between the stock market and the mortgage market, individual wealth has been gutted by seemingly random events.  Don’t believe it.  Spotlight the Federal Reserve, the “lender of last resort,” which has no wealth of its own.  It creates money out of thin air to “lend” to the federal government, which then disburses it to pay bills and fight wars.  This from The Creature from Jekyll Island, which explains the history of money and banking.  It also reveals the secret beginnings of the Federal Reserve Act, which essentially put Congress in the debt-creation business, to trap taxpayers in un-repayable debt until the sun burns out.  In other words, the dollar is backed only by government promises to pay.

Now anyone who trusts government promises deserves to suffer, and those who believe the government has the right to promise unborn taxpayers’ future earnings, in order to repay the Fed for its fiat money “loans,” is living in LaLa Land.

taxarrow0406 What Creature does not say is that the income tax was also initiated in 1913, two months before the Federal Reserve Act, in order to guarantee perpetual interest income to the Fed.  The precedent for this double whammy was set by first Treasury Secretary Alexander Hamilton.  Hamilton introduced legislation for the Whiskey Tax and the first US central bank December 13 and 14th in 1790, for the same purpose—ostensibly to pay off Revolutionary War debts, but also to provide a vehicle for trapping the fledgling nation in a bottomless barrel of new debt.

In my case, debt would force me to work in a career I had come to detest, to feed the absentee bosses and other middlemen, who work behind the scenes to call the shots, yet take no personal risks.

These days, you can’t get away from news reports, politicians, and “economists,” who are bemoaning the state of “the economy,” the need to “create jobs,” and concerns about unstable stock markets and central banks around the world. The hidden truth behind all this hand-wringing is, as Ron Paul has tried to say, “The US is bankrupt.”  (His book End the Fed, is also well worth reading.)

It appears the balance has begun to shift, because everyone–individuals, corporations, and government—is maxed out on credit. Bills are coming due, without resources to pay.  As the Boomer generation (that’s me), approaches retirement, and Social Security payments can’t keep up with expenses, Boomers are withdrawing money from the stock market to make ends meet.  At the other end of the earning spectrum, the millennials are dealing with student debt, credit card debt, automobile debt, and maybe mortgages, too. Not only are there fewer of them than of seniors, but they don’t have money to invest in the stock market.

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But what’s good for “the economy” is bad for individuals. The “strong dollar,” is hurting exports, meaning Josie Taxpayer’s dollar has more buying power at home. Percentage-wise, she pays less in taxes, too.  This “deflation” that terrifies the money churners could have the effect of grounding the dollar at home, where it belongs.  Also, as people get out of debt–whether paying it off, writing it off, declaring bankruptcy, or walking away–the inflated money supply shrinks even more.  Interest on debt, as well as inflation (a “hidden tax,” according to Creature), reduce the buying power of the money. This is great for people who have no debt, and bad for “the economy,” which now is $19 trillion in debt, equal to the gross domestic product.

For example, on Thursday, February 18, 2016, The New York Times ran an article entitled “Oil Price Soars and Shares Rise.”  The assumption by the NYT and Wall Street Journal is that what’s good for stocks and raises prices is good for America.

This false assumption becomes easier to understand when you realize a goodly portion of America is heavily invested in stocks through “retirement benefits” like pension plans, including public pension plans. Hedge fund and pension fund managers can make significant waves in the stock market by moving those large pots of money around.  “Investors,” then, are not primarily the wealthy “one percent” that the public has been taught to hate.

“Investors” are the groups and individuals who make their money through managing other people’s money, people they assume want the greatest value for their money. Only trouble is, the most profitable stocks are issued by some of the most unscrupulous companies, often those with incestuous ties to the government, and are beneficiaries of large, cushy government contracts.

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As is my habit—and one of my favorite pastimes–I underlined and scribbled in the margins of the above-mentioned article. Here, we are informed that stocks climbed the previous day as “investors clung to hope for an international deal” to cut production.  “The price of oil rose sharply, as did the stocks of major energy companies like Chevron.”

“Who benefits by raising oil prices?” I wrote.  I know the State of Georgia benefitted mightily by low oil prices last summer, as Governor Deal signed a six-cent gas tax increase as soon as oil prices fell.  Now, the State of Georgia can expect even more tax revenues.  Already the accumulated excise and sales taxes on gasoline amount to over 50% of the customer cost.

Who is the greatest consumer of oil and gas? I don’t know for sure, but I believe it’s the military, which probably doesn’t pay the taxes and competes for the oil.  I applaud anyone who wants to research that.

When the NYT repeated that “investors’” hope for an “international deal that will cap or cut production,” I commented it doesn’t matter, as demand remains low.  I also asked if this “deal” to cut production also applies to US offshore well drilling, new oil pipelines, fracking, and other domestic eco-rape.

 

We are told that Chevron and Hess profited. We are also told that Kinder Morgan gained, too, on the news that Warren Buffet has acquired a 1.2 percent stake.

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Now Texas-based Kinder Morgan is a loaded kettle of fish. Founded by Richard Kinder, of Enron fame, it is in the process of appealing the state of Georgia’s denial of eminent domain for its Palmetto Pipeline.  Governor Deal did something right, for a change, when he denied Kinder Morgan’s request.  This would have set a dangerous precedent for publicly traded corporations to use state government to seize private property for a pittance.  Not only are oil prices low, and sales slow, but the pipeline is planned to run through 210 miles of coastal Georgia and to affect 396 landowners across 12 counties, only to transport gasoline, diesel, ethanol, and natural gas to the Savannah, Brunswick, and Jacksonville ports for export.  Kinder Morgan also expects to drastically enlarge its liquid natural gas storage facility on the Savannah River.  Meanwhile on the opposite side of the continent, Kinder Morgan is trying to trample Native American Tl’azt’en Nation’s native hunting and fishing lands in British Columbia.

I congratulate anyone who wants to investigate Kinder Morgan’s ethics and stock investors. I’m especially interested in public pension investments in Kinder Morgan, as well as its customers Marathon Oil and Marathon Petroleum, among others.  Remember that everyone in the decision-making “pipeline” from governor to judges to legislators and the United States Congress, state and federal levels of the Department of Transportation, Environmental Protection Division, Department of Natural Resources—and the military—have taxpayer-funded pensions handled by managers for whom there is no bottom line—if they can get taxpayers to subsidize profits.

 

I abandoned Wall Street in early 2008, when it continued to abandon me. I advise anyone who has more sense than money to do the same.  Also, as any stock broker might advise, “Sell high.”

 

 

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*Authors and publication dates are listed in a previous blog, “Sell the TV and Read.”

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Current Events Junkie

NYTimes update on foreclosures, 9/29/15

NYTimes update on foreclosures, 9/29/15

September 30, 2015-I like keeping my finger on the pulse of the planet. I am a current events and history junkie with an insatiable curiosity about how things work. To that end I do process commentary on events as they happen.

Yesterday’s New York Whines (er . . . New York Times) provided the latest update on the so-called sub-prime housing meltdown that began in 2007 and initiated the so-called Great Recession. While the economists and media claim the economy is now recovering, regular people like me have yet to benefit from the recovery.

The NYT front page headline, “More Foreclosures, This Time by Hedge Funds,” sits right under the photo of Dr. Obama offering his hand to Russian President Vladimir Putin. Putin is looking suspiciously at the hand, as though it is diseased.

In the foreclosure article, we learn that “Private equity and hedge fund firms have bought more than 100,000 troubled mortgages at a discount from banks and federal housing agencies.” My synopsis is that the banks are dumping these problems as fast as possible, because of hefty penalties and other cost/labor-intensive measures involved in foreclosures and loan modifications. Federal agencies, such as the Department of Housing and Urban Development (HUD) and the Federal Housing Administration (FHA), with loans underwritten by banks such as JP Morgan Chase and Bank of America, are auctioning bundles of these loans to hedge funds that are paying with public pension money. The $60 billion private equity firm Lone Star, and its subsidiary Caliber, are the ones spotlighted in the article, but obviously they are not the only players. The federal agencies are discounting the loans as much as 30%. Non-profits are mad that they are not getting a larger share of the loot. The hedge funds offer up to four percent interest on these bundled mortgages.

HUD thinks this is a good idea because it saves them money. But Lone Star/Caliber are being accused of foreclosing at a much faster rate than the banks did, and it admits the return on investment comes from foreclosure and re-sale more than from loan modifications.

The NYT does not address is how much equity the stressed individuals have in their homes. My guess is those with more equity are at greater risk of being foreclosed on, because this represents more profit for the asset plunderers. Lone Star claims many of the homes have been abandoned, which means the home buyers lost everything they invested and must start over, without even a place to live. Finally, the overinflated prices of the housing boom left many people owing more than their homes were worth. These poor saps, I believe, are the ones the banks and hedge funds will not foreclose on. However, the modification deals Lone Star offers do not include reductions in principal, such that the “modifications” leave stressed home buyers worse off than before.

The most obvious question I had, after reading the article, is why HUD is offering 30% discounts to hedge funds rather than to the individuals who originally bought these homes. If individuals got the same deals the money churners and asset plunderers get, they could most likely make their mortgage payments, and this problem would cease to exist.

REVISITING 2007

The article prompted me to re-visit my journal–which functions as my therapist and best friend– to check the pulse of the planet (as I read it) when the housing meltdown began. I thought it might be fun to post some of the more interesting (to me) entries on a weekly basis, from an eight-years-later perspective.

Since tomorrow, October 1, 2015, signifies the beginning of the federal government’s fiscal year, it seems timely to fish the past for insights into where I was and where we were then, and where we’re headed now. If you like this idea, please so indicate. The following comes from the first week in October, 2007.

OCTOBER, 2007

Clarence Thomas autobiography, 2007

Clarence Thomas autobiography, 2007

MY GRANDFATHER’S SON, CLARENCE THOMAS, 2007
Monday, October 1, 2007 – I went to Barnes and Noble hoping to buy a copy of Clarence Thomas’ book, My Grandfather’s Son, which comes out today. Jonathan, my B&N employee friend – a coin-collector and customer service book-orderer, a 20’s something kid who agrees with me so is very intelligent – told me B&N only ordered 12 copies of the book. Corporate B&N in New York “didn’t know Clarence Thomas was from Savannah.”

Well, Jonathan, you and I both know that’s a lie, but we’ll pretend they don’t want to undersell his book in his home town. He’s much too credible.

Sure enough, B&N’s 12 copies sold out in about ten minutes. They had to rush order 40 more copies. Should be here in 2-3 days. 400 more copies would be more cost-effective. They can save on UPS shipments.

Apparently B&N’s entire marketing department missed the 60 Minutes interview with Thomas last night, in advance of this pub date. 60 Minutes interviewed him right here in Savannah.

Is B&N trying to lose money? I would sell its stock real quick-like if I had it, and I would buy copies of Thomas’ book, instead, from another distributor. What is B&N trying to hide?

Thus do I think like a free market capitalist.

The Robber Barons, by Matthew Josephson, 1934

The Robber Barons, by Matthew Josephson, 1934

THE ROBBER BARONS, MATTHEW JOSEPHSON, 1934
Tuesday, October 2, 2007 – I’m reading The Robber Barons, about Jay Gould, the money churner and asset plunderer par excellence. Gould was a master manipulator, but anyone who refused to play his games could have stopped him. He used Vanderbilt’s and others’ spite towards him to play out his line, then reeled in the big fish over and over. How many times do people bite before their mouths are full of holes and they are still starving?

I’m getting an explosion of awareness regarding American history. Why has this become my latest passion? I see the patterns set in motion long ago, in the history of human beings as we remember them, and in America.

The American history most astounds me. Lincoln essentially bought political favoritism by giving the West, the Louisiana Purchase, away to friends, political donors, and corporate railroad interests. Thus did he finance his war on the South.

I’m seeing Lincoln and Wilson as ego-driven megalomaniacs, not the great liberators their handlers claimed. They got us into two of the bloodiest wars to date, and the third great liberator, Roosevelt, got us into World War II.

I haven’t appreciated the intensity of my feelings for peace. What I’ve believed was my own violent nature is merely the reflection of a world so foreign to me that I had to identify with it to understand it. Once identified, I can forgive it, or so I hope.

Tuesday, October 2, 2007 – Vis à vis The Robber Barons, I don’t understand sleazy business practices. People like my deck contractor slit their own throats by promising more than they can deliver. He won’t get repeat business from me, nor will he get recommendations around town. In fact, I intend to tell anyone who cares to know what a thief and con he is.   He looked for opportunities to cut corners, let things slide, weasel out of obligations. He reminds me of the warlords who conquered the West like looters on a spree. They are still doing it.

I read, astounded that taxpayers have allowed these people to get away with such cruel dishonesty for so long. We have the veneer of civilization, but the viciousness has only changed garments and venue in time.

Jay Gould must be the idol of today’s Wall Street. This is why product quality has plummeted. Gould, et al. paid more attention to stocks than to managing tangible assets, and today’s brokers are doing the same. They have even less connection with the corporation’s tangible products than before. They deal only in electronic stock certificates, used in place of currency for the insiders. It’s a method for selling other people’s and taxpayers’ productivity. The companies’ products and services are only fronts for selling stock and feathering pension and benefit nests.

Wednesday, October 3, 2007 – I was reading 1910 cultural history and The Robber Barons last night, only because I wanted to do everything else less than that. So I read and marveled at how the illusion of external power has been cultivated over time.

Through all these wars and contests, who has benefitted, I wonder, as I sit in my lofty 21st century perspective. I have the advantage of history to guide me. For all of recorded history, war and fighting don’t work. The fruits of victory are spoiled by the fighting.

The Unknown Reality, by Jane Roberts, 1977

The Unknown Reality, by Jane Roberts, 1977

SETH
Sunday, October 7, 2007 – I remember being disturbed by Seth’s mind-expanding notions. To think that even quarks have consciousness and can choose to be a part of a couch or a bird, can come or go from structures at will, by force of attraction or repulsion, is mind-boggling. Couches go through a great range of different quarks over their lives, but they still maintain their personalities as sofas, a large amalgam, a gestalt, an identity worthy of the label couch, expressing its individual nature in color, fabric, size, weight, and the numerous physical characteristics that define its nature. The same applies to me, as a human. But we are equals in the consciousness department, because consciousness knows no limits. All consciousness is omniscient, but you can only think about a few things at a time. Also, a physical brain has to be trained for certain types of consciousness, follow certain pathways, learn skills, techniques, observe the consequences of decisions along the path. Consciousness develops itself through loops and channels, rooms, gardens, vistas, and on other stages in the mind of god.

Through reading I explore the others’ minds, find much of value, much to challenge. I connect on my mental turf, in my chair, my home, through the efforts my body makes to seek their communication and companionship.

I’m more interested in the authors’ thoughts than personalities. I’m curious about their perspectives, their reasoning, facts, skill, whatever. Personality speaks through the writing. Certainly if the circumstances were right, I could enjoy the company of favorite authors, even cook dinner for them, but I would have to like them a lot for that.