Sunday, March 31, 2013

Nigel Farage on Ron Paul

MUST READ: The Corruption of Capitalism in America

By David Stockman

The Dow Jones and Standard & Poor’s 500 indexes reached record highs on Thursday, having completely erased the losses since the stock market’s last peak, in 2007. But instead of cheering, we should be very afraid.

Over the last 13 years, the stock market has twice crashed and touched off a recession: American households lost $5 trillion in the 2000 dot-com bust and more than $7 trillion in the 2007 housing crash. Sooner or later — within a few years, I predict — this latest Wall Street bubble, inflated by an egregious flood of phony money from the Federal Reserve rather than real economic gains, will explode, too.

Since the S.&P. 500 first reached its current level, in March 2000, the mad money printers at the Federal Reserve have expanded their balance sheet sixfold (to $3.2 trillion from $500 billion). Yet during that stretch, economic output has grown by an average of 1.7 percent a year (the slowest since the Civil War); real business investment has crawled forward at only 0.8 percent per year; and the payroll job count has crept up at a negligible 0.1 percent annually. Real median family income growth has dropped 8 percent, and the number of full-time middle class jobs, 6 percent. The real net worth of the “bottom” 90 percent has dropped by one-fourth. The number of food stamp and disability aid recipients has more than doubled, to 59 million, about one in five Americans.

So the Main Street economy is failing while Washington is piling a soaring debt burden on our descendants, unable to rein in either the warfare state or the welfare state or raise the taxes needed to pay the nation’s bills. By default, the Fed has resorted to a radical, uncharted spree of money printing. But the flood of liquidity, instead of spurring banks to lend and corporations to spend, has stayed trapped in the canyons of Wall Street, where it is inflating yet another unsustainable bubble.

When it bursts, there will be no new round of bailouts like the ones the banks got in 2008. Instead, America will descend into an era of zero-sum austerity and virulent political conflict, extinguishing even today’s feeble remnants of economic growth.

THIS dyspeptic prospect results from the fact that we are now state-wrecked. With only brief interruptions, we’ve had eight decades of increasingly frenetic fiscal and monetary policy activism intended to counter the cyclical bumps and grinds of the free market and its purported tendency to underproduce jobs and economic output. The toll has been heavy.

Read the rest here.

David A. Stockman is a former Republican congressman from Michigan, President Ronald Reagan’s budget director from 1981 to 1985 and the author, most recently, of “The Great Deformation: The Corruption of Capitalism in America.”

LBJ's Great Grandkids Go Wilding in Rahmaland

Nearly 30 people were arrested downtown on Saturday night for disturbances that ranged from bumping into passersby on sidewalks to attacking passengers aboard a CTA train, authorities said, citing preliminary information,reports the Chicago Tribune.

Seventeen of the people in custody -- all but two younger than 18 -- were charged with misdemeanor reckless conduct, said Chicago Police Department News Affairs Officer Hector Alfaro.

Those arrests happened on the Magnificent Mile near North Michigan Avenue and East Huron Street between 7 p.m. and about 7:40 p.m., authorities said. The suspects were alleged to have bumped into other people on the sidewalks, blocked sidewalks and traffic on the street and started fights among themselves.

In a separate incident, police arrested 11 teens at the CTA's State/Lake station in The Loop about 6:35 p.m. after the group attacked two women on an elevated train car, authorities said, citing preliminary information.

The incident started when a woman on the "L" asked one of the teens to put out a cigarette, authorities said, citing preliminary information. The group of teenagers then allegedly attacked that woman and another woman on the train before running onto the "L" platform with the purse belonging to one of the victims.

Officers arrested the teens as they attempted to leave the station, authorities said.

The 11 teens, all but one of whom are younger than 18, told police they had agreed on Twitter to meet downtown. It appeared that several of those arrested had not met in person before Saturday, authorities said.

The two victims were bruised during the attack but were in good condition and declined medical treatment, authorities said.

Saturday night's incidents were what some officers describe as "wildings," where large groups of teens swarm the downtown area and cause an array of disturbances.

Video here.

This Week in TSA Drama

Baghdead TSA Bob reports in:
A replica WWII German “Potato Masher” grenade was discovered in checked baggage at Charlotte (CLT). It was a gift for the passenger’s son.
A passenger flying out of San Juan told the ticket agent that her bag contained a bomb and she was going to blow up the plane. After it was all said and done, her bag didn’t have a bomb, but as a result of her threat, the ticket counter, checkpoint, and terminal were closed for nearly an hour. There were consequences.

Ron Paul's Position on the Flat Tax

Is Paul Krugman a Neo-Confderate Racist

Paul Krugman once smeared the Austrian economist and historian Tom DiLorenzo as a "Johnnie Reb economist," for DiLorenzo's take on Abraham, Lincoln. However, in a recent blog post, Krugman takes the same position on Lincoln's economic policy as DiLorenzo does, should we thus consider Krugman a neo-confederate racist?

Here is DiLorenzo with a blow-by-blow:
A couple of years ago when I appeared as one of Ron Paul's witnesses (the first one, actually) during his House of Representatives hearings on the Fed, the Democrats got the biggest leftist on the committee to smear, libel, and slander me by repeating the smears, libels, and slanders about me (and virtually all other libertarians and conservatives) by the left-wing hate group known as the Southern Poverty Law Center.  The hate group's typical line is this:  1) DiLorenzo wrote a book critical of Lincoln's economic policies; 2) Therefore, he must want to bring back slavery.  Since we now live in a nation of morons, the SPLC is able to raise millions of dollars in contributions from below-50-I.Q. liberals and leftists with such smears.  "Send us money and we will keep an eye on these people," they say.  (This is the same group of communistic crackpots who convinced Big Sister Janet Napolitano to publicly announce that people with Ron Paul bumper stickers on their cars may be considered potential terrorists by her Department of Fatherland Security). 
Paul Krugman participated in this libelous smear in one of his NY Times columns, labeling me Ron Paul's "Johnnie Reb economist."  He said nothing at all about my critiques of the explosion of economic statism during the Lincoln administration, the focus of all my writings on the subject.  Instead, he played along with his fellow totalitarians and their meaningless "Neo-Confederate" blather. 
But in a recent blog Krugman proved once again what a fraud and a liar he is by writing that "Lincoln was actually a big government interventionist" whose "most dramatic departure from standard economic policy was . . . debasing the currency."  This means that when he participated in the Southern Poverty Law Center smear of yours truly he was obviously cognizant of the fact that libertarians like myself and Ron Paul are critical of Lincoln not because we want to bring back slavery (!!) but because, as Krugman says, he ushered in big-government interventionism and the debasing of the currency with his National Currency Acts and Legal Tender acts.

Countdown to the Wenzel-Kinsella Debate: 1 Day

My debate with Stephan Kinsella over intellectual property is tomorrow. The debate will be posted here at EPJ and by Kinsella at his site, at 5:00 PM ET on April 1.

A few comments.

I see some are already beginning, before the debate has even begun, to charge me with using a straw man by introducing Jeff Tucker into the debate. My intention in bringing Tucker into the debate is to show that he doesn't even understand Kinsella's position. I will not be arguing: "Tucker is clueless therefore Kinsella is clueless."

I will be arguing: Tucker is so clueless, he doesn't even understand Kinsella.

I am doing this because Tucker has a lot of young followers, who need to understand that Tucker really doesn't have a clue as to what he is talking about. If you don't like that I will be smashing Tucker along with Kinsella, I recommend you not listen to the broadcast.

As for Kinsella, I will start hitting him hard within 5 to 10 minutes of the debate, but I won't launch my fiercest attack until much later in the debate.

I really can't wait for the debate to begin. It should be a lot of fun and expose many of the weaknesses in the arguments of the anti-IP crowd.

The dynamic duo Tucker and Kinsella. I can't wait to find out how Kinsella is going to deal with the obvious errors of Tucker. Will he throw Tucker under the bus or shade his own views?

Jesse Benton Strikes Again

By Lori Stacey

As if millions of Ron Paul supporters could ever forget the gaffes and missteps made by Jesse Benton, it seems that he is at it again. This time, Benton is sticking his foot in it regarding Ron Paul's son, Senator Rand Paul.
Just as Rand seemed to be enjoying a huge boost in popularity following his nearly 13-hour filibuster on the Senate floor, it appears that Jesse Benton was most likely instrumental in securing Rand's recent endorsement of insider Mitch McConnell. If that was not bad advice enough, Benton recently took liberty in telling the world that Rand Paul supposedly "Can't stand" a particular tea party leader in Kentucky.
After an abrupt exit from the Ron Paul campaign, Jesse Benton became the new campaign manager for Senator Mitch McConnell. Because of his new duties, Benton appears to be turning his back completely against the tea party movement in Kentucky. Does he really expect Rand Paul to do the same?
In a recent interview with Daily Caller, Benton insists that there is supposedly no interest at all in finding a tea party challenger to Sen. McConnell. As Benton continues, the old diarrhea of the mouth problem seems to come back to roost. While referring to David Adams who is reportedly trying to find a tea party challenger to McConnell, Jesse states the following:
David Adams? The guy we fired? He’s just so incompetent. He’s trying to stir some rumor mill (about a serious tea party challenger.)
Rand can’t stand David (Adams).
If you want to politically go from "hero" to "zero," perhaps the best path seems to be to take Benton's political advice and then let him begin speaking for you. What kind of political campaign manager openly divulges information such as stated above? Even if it were true, who else would say this in an interview with a publication like Daily Caller? The answer may just be that only Jesse Benton would do such a thing.
The endorsement of McConnell is yet another bad political move on Rand's part. Obviously, Jesse Benton must have played a key role in working this out. Senator Paul has still not fully recovered from the Romney endorsement delivered while his Father was still in the race. More endorsements like this and he is well on his way to insuring that he will never recover much of Ron Paul's base of support. Rand could have had the majority of Ron's supporters, the current tea party movement and the rest of the base of the Republican party but his ill-advised endorsements continue to kill any chances of that possibility ever returning in the future.
Hopefully, Rand Paul will finally begin to distance himself from Benton. A swift call to David Adams with an apology would certainly be recommended as well. Adams is Chairman of the Kentucky Republican Liberty Caucus and was Rand Paul's first campaign chairman in his run for the US Senate.

EPJ Calendar: The Good, The Bad & The Interventionists

By, Chris Rossini
Email | Twitter

Each Sunday EPJ publishes a calendar of upcoming political & economic events. The appearance of an event does not necessarily mean an endorsement by EPJ; hence the name The EPJ Calendar: The Good, The Bad & The Interventionists.

If you believe that your event, speech, meetup, etc. should be on our weekly calendar, please email me at


Ilana Mercer Discusses Rand Paul on The Robert Wenzel Show

This Week's Guest Is:
Ilana Mercer
Libertarian Author, Columnist, Blogger

Direct Link

2013 Interviews:
2012 Interviews:

Saturday, March 30, 2013

A Budding Lawyer Deals with a Salt Lake City Copper

J.J. Luna writes:
I recently heard of an anecdote from a fellow lawyer in Salt Lake. It seems that in his law school days, he was full of himself, and wore long hair and generally looked like a hippy; which does not play well in Salt Lake. One night after class he was pulled over by the police for no apparent reason. The officer kept pressing for consent to search the car. 
The budding lawyer, well aware there was no probable cause, offered a trade. The officer could search his car if he was allowed to search the officer's car. After an expletive laced tirade, the officer left. Although not recommended, it does show that knowing your rights counts for a lot.
Best advice:  Stand your ground and repeatedly state "You do not have permission to search the car." Repeat until blue in the face, with emphasis on the word not. That should work until the DHS takeover, at which point all bets are off.
(ht Joe Kozlowski)

Howard Buffett's Easter Advice To Obama

By, Chris Rossini

Obama has given his Easter & Passover remarks...Here's a snippet (my emphasis):
As Christians, my family and I remember the incredible sacrifice Jesus made for each and every one of us – how He took on the sins of the world and extended the gift of salvation. And we recommit ourselves to following His example here on Earth...
Ok, well, I think Obama would do well to ponder some advice given in 1952 by a man named Howard Buffett:
“Even if it were desirable, America is not strong enough to police the world by military force. If that attempt is made, the blessings of liberty will be replaced by coercion and tyranny at home. Our Christian ideals cannot be exported to other lands by dollars and guns. Persuasion and example are the methods taught by the Carpenter of Nazareth, and if we believe in Christianity we should try to advance our ideals by his methods. We cannot practice might and force abroad and retain freedom at home. We cannot talk world cooperation and practice power politics.”
Obama, you know Howard's son quite well.

Give him a call and ask about his Pop.

Also, if you really want to follow through on your remarks, you'll have to stop earning headlines like this:

...that produce results like this:

Making that choice would be an important step in "following His example here on Earth."

Follow @ChrisRossini on Twitter

How to Respond to a Bank of America Survey

David Mueller emails:
For some reason I got onto some Bank of America survey group.  The question I'm now answering is "What images, impressions, or associations come to mind when you think of Bank of America?"

This is just too juicy to pass on.  Here is what I've said so far:

Scams, Frauds, disastrous corporate balance sheet, poor online security, accounts vulnerable to identity theft, bankruptcy, fractional reserve banking scam, poor management, poor underwriting standards, government welfare recipient, beneficiary of crony capitalism, Bank of Scamerica, bailouts.

The Irresponsible Jeff Tucker

Jeff Tucker is out with a column on bitcoins. Not surprising, it is filled with over the top commentary and errors in the fundamental presentation of economics, just like his IP work.

I really don't want to go into his full discussion of bitcoins, once I destroy Tucker, along with Kinsella, in Monday's debate, people will be much more careful about any of Tucker's views.

I do, however, want to point out one comment by Tucker that is quite irresponsible. He writes:
 Many people fear that Bitcoin is overpriced right now. This view is held even by people in the Bitcoin community who worry that a move from $15 to $93 in three months is not good for long-term viability. A crash could bring down the currency unit in devastating ways, leading to another round of debunking and clucking from the advocates of government money.
But here’s the truth: No one knows for sure. Maybe the price will keep climbing. Next month at this time, people might be kicking themselves for not getting in right now. My instincts right now tend in this direction. I’m seeing BTC at $250, then $500, and then $1,000 by year-end.
I also find bitcoins an interesting investment vehicle, but I would never make such an open ended comment as Tucker does here. I have recommended bitcoins in the EPJ Daily Alert, but I also recommended a limit, in the ALERT, on how much bitcoins should be bought. The limit being just 1% of an individuals portfolio. With Tucker's open ended commentary, he is setting up a situation where novice investors get too enthusiastic and plow all their money into bitcoins, which if things don't go right, could result in massive losses.

Bitcoins are attractive because they provide some degree of anonymity in conducting transactions. They are also extremely difficult, perhaps impossible, for the government to grab, which is something that you can't say about bank deposits (See Cyprus). But they are not now money.

They, in some ways, act like travelers checks, in some ways act like gold and have some characteristics of a penny stock pump and dump scheme. Bitcoins are not, however, any of the three entirely. As bitcoins get more popular, they are likely to gain more attention from the government, and the government is likely to continue to attack BTC at its most vulnerable point, the conversion point between dollars and bitcoins and vice versa. Thus, the potential for wild swings in bitcoins is very possible.

If BTC does take off and the coins climb in price by a multiple of their current price, by say, 10 or 20 times current levels, even a very modest investment of 1% of a portfolio, is going to show spectacular results, while limiting downside exposure.

Tucker's commentary is extremely dangerous, because, like an amateur, he fails to take in to consideration the possibility of something going wrong and adjusting for it. He is going to drive novices into going all in on an investment that is very complex and has downside if things go wrong. I am not saying that bitcoins should not be bought, but they should only be bought with the understanding that A. things could go wrong and B. price volatility is not out of the question. Thus, my conservative approach of only advising that 1% of portfolio be put into bitcoins (or for river boat gamblers 10%).

Downside always has to be considered in any investment, Tucker ignores this. The only investment that I am comfortable calling a very safe investment is nickels. I wouldn't have a problem with an investor putting 50% or more into nickels. I am nowhere near as comfortable with the intriguing investment, bitcoins.

How a Baseball Player Can Maximize Velocity When Pitching

Opening day for Major League Baseball is March 31, with the Texas Rangers taking on the Houston Astros. All other teams are scheduled to start their seasons on April 1.

Click on graphic for larger view.

Via WSJ.

Rand Paul’s Important Concession on Guns

When it was reported that Rand Paul, Mike Lee, and Ted Cruz might filibuster a gun control act, I commented:
At this point, we take a wait and see attitude on everything Rand does. Let's see how his gun control opposition develops.
Sure enough problems have emerged with Rand's "anti"-gun control stance. Greg Sargent at WaPo hails Rand's position in a post titled, Rand Paul’s important concession on guns:
Senators Rand Paul, Ted Cruz, and Mike Lee all appear set to mount a filibuster to prevent any Obama gun control proposal of any kind from being debated on the Senate floor — on Second Amendment grounds. Senator Paul went on Fox News last night to explain his thinking.
In the process, however, Paul inadvertently made an important concession. Here’s what he said: 
“I haven’t heard one proposal from him or Harry Reid that would have saved one life. And I’m all for saving lives….We plan on making them have at least 60 votes to pass any legislation that may abridge the Second Amendment. So we will fight tooth and nail, and use every parliamentary procedure to stop that from happening. We have a lot of things on the books that the president says he wants to enhance, many of these could be enhanced without any legislation.Background checks already do workWe already have rules that say mental health statistics need to come from the states to the data bank.”[...] 
 Shouldn’t the possibility that expanding gun background checks could save lives — which Paul himself says he wants — be enough for him to actually give the idea serious thought? 
It’s also important that Paul claimed that current background checks “already do work.” Here’s why: He’s effectively allowing that the current background check law is not a threat to people’s Second Amendment rights. The current compromise on expanded background checks being negotiated would simply expand the current system to cover most private sales. It would maintain the prohibition against any national gun registry. It would maintain the current system of record keeping — in which dealers keep records of sales, and the feds destroy any record of a valid gun transfer within 24 hours. By Paul’s own lights those things, in the context of the current law, are not a threat to Americans’ constitutional rights. There is no logical way, then, that the new proposal threatens them, either. This is an important concession.
I consider background checks exceedingly dangerous, as they alert the government to who is buying guns. That is the last thing any person, who understands how dangerous totalitarian governments are, would want. We aren't completely totalitarian yet, but background checks would make it easier for a future dictator. Thus, Rand, again by micro-managing things, takes a view that would result in more government, not less.

(Felix Bronstein)

Krugman: Lincoln Was a Big Government Interventionist Who Debased the Currency

Paul Krugman occasionally speaks truth, when he is attacking Republicans. He did so in a recent post when discussing House Speaker John Boehner invoking Abraham Lincoln:
 Greg Sargent catches John Boehner invoking none other than Abraham Lincoln to inveigh against the deficit. This is pretty funny — in multiple ways.[...] Greg’s catch: Boehner truncated the quote, leaving out the part where Lincoln called for balancing the budget by raising taxes. And also the point that Lincoln was actually a big government interventionist for his time, a strong advocate of what we would now call industrial policy. 
But wait: there’s more. Lincoln’s most dramatic departure from standard economic policy was … drumroll .. debasing the currency (pdf). Here’s the dollar price of gold:

Ron Paul: "The same thing will happen to the Federal Reserve as happened to the Soviet Union."

Ron Paul spoke this morning in Santiago, Chile.

Jim Rickards sent out the following tweets from the event:
A raucous, extended standing ovation for #RonPaul here in #Santiago. Paul: "It sounds like the revolution has gone international!"
One of the most attractive things about #RonPaul is his humility. Before he started speaking, he took time to introduce and thank his wife. [Note: This is genuine Ron Paul and not the "performance humility" of the new Pope-RW]
#RonPaul in #Santiago: "The same thing will happen to the Federal Reserve as happened to the Soviet Union."
More of #RonPaul in #Santiago: "The handwriting's on the wall; the system is failing."
In #Chile #RonPaul: "What are they going to replace it with. It could go into a fascist state. I don't believe we'll work our way out of it"
From #RonPaul in #Santiago: "If we do nothing to promote correct ideas, the other side will prevail."
From #Santiago & #RonPaul: "Liberty has been divided into two parts; economic liberty & personal liberty. We must put those back together."
More #RonPaul in #Santiago: "Those same fences that keep people out can keep us in. I'm talking about #CapitalControls."
#RonPaul in #Santiago, #Chile: "People in Washington say we need to sacrifice. I say abolish the #IRS. That's not a sacrifice, it's a gift!"
#RonPaul speech ran 20 minutes over. No one minded at all. The audience hung on every word.
#RonPaul: Thing that encourages him most is reception he gets on liberal campuses like #Berkeley & #AnnArbor. Liberty unites left & right.

Countdown to the Wenzel-Kinsella Debate: 2 Days

My debate with Stephan Kinsella over intellectual property is only 2 days away. The debate will be posted here at EPJ and by Kinsella at his site, at 5:00 PM ET on April 1.

A few things to keep in mind during the debate:

Although some Kinsella supporters in the comments to my posts seem to think that I am bluffing when I say that I will bring up errors made by Jeff Tucker, I am not.

I have example after example of errors made by Tucker. He really has no understanding of IP, and is the last guy that should be weighing in on Kinsella's views. Listen through out the debate as I sprinkle Tucker errors and use Kinsella to destroy some of the absurd things Tucker has said.

The prominence Kinsella's IP views have achieved within the libertarian movement are largely the result of Tucker, who has trumpeted them without understanding what he was talking about.

On another point, although, I will show the weaknesses of Kinsella's argument in many, many ways, pay particular attention when I discuss Kinsella's "framework" for his theory. It is the most absurd framework I have come across, I will point out its absurdity and explain the correct framework.

I recommend lots of popcorn.

I wonder if Kinsella still thinks this:
What a clown. Another prediciton: [Wenzel] will not debate me. He will find a way ot [sic] weasel out of it, like a worm.
Hee, hee, hee.

‘I Recommend You Read Rothbard’

Says a sign, in Polish, held up during a live news coverage in Warsaw.

Of course, you can also have morning coffee every weekday with Murray Rothbard right here at EPJ.

(ht Tom Woods)

As The World Turns

By, Chris Rossini
Email | Twitter

Below you'll find snapshots of how major markets around the world ended the week.

U.S. - Dow Jones Industrial Average +.46%

China - Shanghai Composite Index -3.94%

EPJ Week In Review - Week Ending 3-29-13

By, Chris Rossini
Email | Twitter

Below you'll find everything that has been published on EPJ for the week ended Friday March 29th, 2013. The hottest posts for each day are highlighted in red.

Most Commented Posts
  1. Is Rand Paul a Libertarian?
  2. Countdown to the Wenzel-Kinsella Debate: 5 Days
  3. EPJ's Rand Paul Resource Page
Friday 3/29/13
Thursday 3/28/13

Friday, March 29, 2013

$6 TRILLION later...If only they had listened to Ron Paul [2002]

By, Chris Rossini

Follow @ChrisRossini on Twitter

The Never Again Campaign

Used Car Prices During the Great Recession

Adelson in Israel

By Max Raskin & David de Jong

Sheldon Adelson, the U.S. casino mogul who has called himself the world’s richest Jew, couldn’t vote in Israel’s parliamentary elections in January. That didn’t stop his free daily newspaper, Yisrael Hayom, from publishing a front-page editorial last year arguing in favor of bombing Iran’s nuclear facilities -- an option voiced by Israeli Prime Minister Benjamin Netanyahu.

Since its inception in 2007, Adelson’s Tel Aviv-based paper has supported Netanyahu, the leader of the Likud party. The paper had the highest weekday readership in the country last year, according to a Target Group Index Israel survey.
“Yisrael Hayom has had a huge effect,” Elliott Abrams, a senior fellow for Middle Eastern Studies at the Council on Foreign Relations, said by telephone. “It has to be one of the best investments anybody has ever made in terms of trying to have a political impact. It’s basically a pro-Likud paper.”

Adelson, the 79-year-old chairman of Las Vegas Sands Corp. (LVS), who has a net worth of $25.9 billion, according to the Bloomberg Billionaires Index, is one of at least five American billionaires who have spent their money trying to shape Israel’s political landscape. Some of the moguls donate directly to candidates and non-profits; another funds the construction of settlements in contested Jerusalem neighborhoods.

Read the rest here.

Margolis to U.S.: Stop Provoking North Korea

North Korea Is Not Libya, Grenada or Iraq, It Has a Formidable Army

by Eric Margolis

The United States and the two feuding Koreas could blunder into a real war unless both Pyongyang and Washington cease provoking one another.

Last week, two nuclear-capable US B-2 stealth bombers flew non-stop from America to South Korea, and then home. These ‘invisible’ aircraft can carry the GBU-43/B MOAB 13,600kg bomb that is said to be able to blast through 70 meters of reinforced concrete, putting North Korea’s underground nuclear facilities and its leadership’s command bunkers under dire threat.

Earlier this month, US B-52’s heavy bombers staged mock attack runs over South Korea – within minutes flying time of the North - rekindling memories of the massive US carpet bombing raids that devastated North Korea during the 1950’s Korean War. US-South Korean-Australian war games in March were designed to train for war with the North. The US media ignored these provocative exercises, but, as usual, North Korea went ballistic, foolishly threatening to attack the US with long-ranged missiles it does not yet possess.

We have grown jaded over the years by North Korea’s threats and chest-beating. But its recent successful nuclear test and work on a long-ranged missile have begun to add muscle to Pyongyang’s threats. No sooner was the new young North Korean leader, Kim Jong-un, in power than the US, South Korea and Japan began testing him.

More important, the US-South Korea defense treaty calls on Washington to militarily intervene if war erupts between North and South Korea. Given present tensions, a border fight on the Demilitarized Zone (DMZ), commando raids by North Korea’s 110,000-man special forces, air or naval clashes could quickly lead to full war.

North Korea has repeatedly threatened to flatten parts of South Korea’s capitol, Seoul, using 11,000 heavy guns and rocket batteries hidden in caves along the DMZ. North Korean commandos and missile batteries are tasked with attacking all US airbases and command headquarters in South Korea. The 28,500 US troops based in South Korea will also be a primary target.

Read the rest here.

A GOP Subliminal Message for Hispanics

By, Chris Rossini

Page 17 of The Republican's master plan known as the "Growth and Opportunity Project" reads:
It is imperative that the RNC changes how it engages with Hispanic communities to welcome in new members of our Party. If Hispanic Americans hear that the GOP doesn't want them in the United States, they won't pay attention to our next sentence.
Neocon Jennifer Rubin shows that she has read the instructions and has comprehended the sage advice. In one of her columns today, that criticizes Obamacare, she shows how the process of "engagement" is done (my emphasis):
President Obama in 2012 used “The Life of Julia” storybook ad to highlight all the great things the welfare state does for single women. How about the “Life of Ricardo,” illustrating how Obamacare is going to mess up the health insurance and employment opportunities for a middle-class father, and how a GOP alternative would work?
Here's my advice for "Ricardo":

Republicans will do nothing about Obamacare, but they will find a way to send you and your friends to go shoot-em-up somewhere in the world.

They may even slip, and call you a "wetback" along the way.

No "Ricardo"...Republicans are not for you.

Best to dump both parties.

Look into libertarianism.

Follow @ChrisRossini on Twitter

Obama Budget May Include Manipulated CPI Number...

As if it isn't manipulated enough already.

WSJ reports the White House budget may include chained CPI. Chained CPI replaces in the CPI goods climbing quickly in price with "similar" goods that aren't climbing as fast. Nuff said, it is a plan to screw the old who are on social security.

Jim Rogers: "Run for the Hills"

The EU/IMF raiding bank accounts in Cyprus to bail out the country's financial system sets a dangerous precedent and investors should "run for the hills" said investor Jim Rogers, chairman of Rogers Holdings, on "Squawk on the Street" Thursday.
Rogers said that with Cyprus, politicians are saying that this is a special case and urging people not to worry, but that is exactly why investors should be concerned.

"What more do you need to know? Please, you better hurry, you better run for the hills. I'm doing it anyway," Rogers said. "I want to make sure that I don't get trapped. Think of all the poor souls that just thought they had a simple bank account. Now they find out that they are making a 'contribution' to the stability of Cyprus. The gall of these politicians."
"If you're going to listen to government, you're going to go bankrupt very quickly," he added.
"I, for one, am making sure I don't have too much money in any one specific bank account anywhere in the world, because now there is a precedent," he said. "The IMF has said 'sure, loot the bank accounts' the EU has said 'loot the bank accounts' so you can be sure that other countries when problems come, are going to say, 'well, it's condoned by the EU, it's condoned by the IMF, so let's do it too.'"

The video is here.

FGCU: Koch Brothers in the Sweet 16

Just because George Mason University didn't make it into March Madness this year, don't think the Koch Brothers aren't covered. A Kochoctopus tentacle has made it into the Sweet 16.

Think Progress reports:
It’s a great story: the virtually unknown, 15th seeded Florida Gulf Coast University (FGCU), has made it to the Sweet 16 in the NCAA tournament. But there’s something you might not know about FGCU: its economics department is, as a consequence of grants from Randian businessman John Allison and the Charles G. Koch Foundation[...]
According to
 At Florida Gulf Coast University in Fort Myers, every student who majors in economics and finance gets a copy of Ayn Rand’s novel, Atlas Shrugged.[...]“I’d like to develop a center for free enterprise,” says Bradley Hobbs, the professor of economics who is spearheading the effort.
Naturally, because the Kochs have a tentacle in the operation, Hobbs mentions Hayek and not Rothbard or Mises:
 .“We also need diversity of thought,” says Hobbs, whose own early leftist views shifted “from Marx to Hayek” later in his career."

Hobbs said he has received funding of $600,000  from BB&T, which is the bank John Allison was CEO, before heading up Cato Shrugged. It's all beltarian money after that. reports:
So far, the support Hobbs has received hasn’t been local. “The support I get is out of D.C.,” he says.
Not surprising the work they are doing is technocratic and works to maintain the state, rather than principled  free market positions. informs that one FGCU economist wants to abolish the mortgage tax deduction:
 Dean Stansel, associate professor of economics, recently co-authored a paper for the Reason Foundation that concluded that the tax code’s mortgage-interest deduction is ineffective at promoting homeownership and distorts the allocation of capital in the economy because it favors taxpayers who itemize deductions. Eliminating the deduction would reduce excessive debt and lead to a healthier housing market in the future.

Understanding Bitcoins

Note: Bitcoins are not money, at least not yet. They are not accepted in most monetary exchanges. They should be thought of as a type of digital travelers check, with a kicker, and its a big kicker. Unlike, say American Express, which issues a travelers check on a 1 to 1 dollar basis for each new amount of money it takes in, there is a fixed amount of bitcoins so they can fluctuate in price relative to the dollar. In this way they are a little bit like gold--which can fluctuate against the dollar. 

The advantage of bitcoins are that they provide some anonymity in transactions and they are near impossible for the government to confiscate.-RW

By Paul Ford

One of the oddest bits of news to emerge from the economic collapse of Cyprus is a corresponding rise in the value of Bitcoin, the Internet’s favorite, media-friendly, anarchist crypto-currency. In Spain, Google (GOOG) searches for “Bitcoin” and downloads of Bitcoin apps soared. The value of a Bitcoin went up to $78. Someone put out a press release promising a Bitcoin ATM in Cyprus. Far away, in Canada, a man said he’d sell his house for BTC5,362.

Bitcoin was created in 2009 by a pseudonymous hacker who calls him or herself Satoshi Nakamoto (and who might be several people). It’s a form of virtual cash used to buy goods and services online. Even by Web standards, it’s a strange and supergeeky phenomenon. This is what happens when software and networks meet the concept of currency, when you take peer-to-peer networks and advanced cryptography and ask, “How can I make a new economy?”

There are 10,952,975 Bitcoins in circulation. (With a digital currency you can be specific.) Bitcoin isn’t about to replace hard currency—with a market cap of $864 million, all of it is worth less than what Facebook (FB) paid for Instagram—but it’s bigger than anyone expected. And many people will tell you that the emergence of a virtual global money supply beyond the reach and control of any government is very real and that it’s time we take it seriously. As long as the Internet remains turned on, Bitcoin will be there—to its adherents, it’s the Platonic currency.

A dollar bill has a serial number and travels from buyer to seller. A Bitcoin’s not so much a thing as an understanding, a balance in a decentralized general ledger, or “account log.” Bitcoins are created as the side effect of a great deal of meaningless computational work. That is, the computer could be working on protein-folding, or processing images, or doing something else with its time, but instead it’s being used to “mine” Bitcoins—searching for mathematical needles in a networked haystack. Once the needle is found, a “block” of Bitcoins is born. Bitcoins live in a bit of software known as your “wallet.”

How did they get there? Perhaps you minted them by mining, or bought them on an exchange, or received them as part of a barter transaction. Now those Bitcoins are burning a bithole in your bitpocket, and you want to buy something. How do you spend them? Clicking around your wallet app, you set up a payment and put in the Bitcoin address of the recipient—something memorable and fun, like 1Ns17iag9jJgTHD1VXjvLCEnZuQ3rJDE9L. A few minutes later, after the peer-to-peer network has authorized the transaction as legitimate, the recipient’s wallet, wherever it is, will show that you’ve paid up.

Read the rest here.

Countdown to the Wenzel-Kinsella Debate: 3 Days

My debate with Stephan Kinsella over intellectual property is only 3 days away. The debate will be posted here at EPJ and by Kinsella at his site, at 5:00 PM ET on April 1.

During my debate I plan to use arguments from as many five different scholars that will point out obvious confusion in Kinsella's thinking. I think the names will surprise Kinsella.

Correctly name, in the comments section, the scholar(s) that I actually use and you will win a lifetime subscription to the EPJ Daily Alert. But you must name all the scholars I use in the debate but no extras. Depending how the debate goes, I may use one or all five of the scholars I currently have in mind. Only one entry per person.

Go for it. Two people were correct that the new pope would choose Francis as his new name. They now have subscriptions to the ALERT. Let's see if anyone can pull this one off.

Another Boring Public Day for Jack Lew

The Treasury reports:

On Friday, Secretary Lew will conduct meetings at Treasury. He has no public events scheduled.

The Biggest Bellyachers Live on the Upper West Side of Manhattan and in Boca Raton, Florida

Bloomberg news reports:
When U.S. officials began collecting consumer complaints about credit cards, one goal was to identify patterns that could help them write rules protecting families with low and moderate incomes.

Nearly two years later, it’s the well-to-do neighborhoods of Florida and New York that are supplying the most grievances to the Consumer Financial Protection Bureau, an analysis of agency data shows.

Of the top four zip codes contributing to the 18,539 complaints published as of March 18, two are on Manhattan’s Upper West Side and two in south Florida -- Boca Raton and Palm Beach Gardens.

Breaking: SAC Capital Manager Arrested This Morning for Insider Trading

SAC Capital Advisors LP manager Michael Steinberg was arrested early this morning for the non-crime of insider trading.

SAC put Steinberg on paid leave last fall, declining to specify the reasons for the move.

The arrest of Steinberg is a typical government strategy. Their real target is SAC founder Steve Cohen. The arrest is a move to squeeze Steinberg to give up dirt on Cohen. Stalin would be proud.

Murray Rothbard on the Correlation Between Money and Freedom

By, Chris Rossini

Follow @ChrisRossini on Twitter

Thursday, March 28, 2013

Heavily Armed Vigilantes Take Control of Mexican Town, 'Arrest' All of the Police

NyPo reports:

Hundreds of armed vigilantes have taken control of a town on a major highway in the Pacific coast state of Guerrero, arresting local police officers and searching homes after a vigilante leader was killed. Several opened fire on a car of Mexican tourists headed to the beach for Easter week.

Members of the area's self-described "community police" say more than 1,500 members of the force were stopping traffic Wednesday at improvised checkpoints in the town of Tierra Colorado, which sits on the highway connecting Mexico City to Acapulco. They arrested 12 police and the former director of public security in the town after a leader of the state's vigilante movement was slain on Monday.

The vigilantes accuse the ex-security director of participating in the killing of vigilante leader Guadalupe Quinones Carbajal, 28, on behalf of local organized crime groups and dumping his body in a nearby town on Monday. They reported seizing several high-powered rifles from his car, and vigilantes were seen toting a number of sophisticated assault rifles on Wednesday, although it was not clear if all had been taken from the ex-security director's car.

"We have besieged the municipality, because here criminals operate with impunity in broad daylight, in view of municipal authorities. We have detained the director of public security because he is involved with criminals and he knows who killed our commander," said Bruno Placido Valerio, a spokesman for the vigilante group.

Hollande Goes Tax Crazy in France

French President François Hollande says France will now tax corporate executive salaries over 1 million euros at a 75% rate.

Expect a massive exit of top executives from France, if Hollande is successful in implementing this tax.

Neocons Itch For War With Syria. Ron Paul Warned Against It [2011]

By, Chris Rossini

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Amazon and Overstock Lose Challenge to Online Sales Tax

Amazon and lost a challenge to New York’s Internet sales tax law as the state’s highest court rejected their arguments that it was unconstitutional.

The companies argued that the law violated the Commerce Clause of the U.S. Constitution by subjecting online retailers without a physical presence in the state to sales and compensating use taxes. It violated the Due Process Clause by “creating an irrational, irrebuttable presumption of solicitation of business within the state,” they said.

Google Launches Same-Day Delivery in San Francisco Bay Area

Google has been testing the service, called Google Shopping Express, with employees for a few months. The company opened it up to the public this morning in a limited launch focused on San Francisco residents and others living south of the city from San Mateo to San Jose.

Shoppers who sign up will get six months of free, same-day delivery of online orders placed with select retailers in the area. Google plans to charge for the service in the future, but it has not decided how much yet.

Companies taking part in the test include national retailers such as Target, Office Depot Inc, Staples Inc and Toys 'R' Us Inc and smaller, local firms such as Blue Bottle Coffee and Palo Alto Toy & Sport.

The Sequester Circus is Over

John Raines emails:
As a follow up to my previous email about the sequester, I came across this article today. 
MIRACULOUSLY, the furlough days for DOD civilians is reduced from 22 to 14! For all of the fear mongering of the sky falling and the sequester apocalypse our leaders will be lauded for 'protecting' the public servants who serve our nation from the horrors of 'budget cuts'.

Now that we've moved past the end of the year sequester circus the government can stop threatening government works with pay cuts. Watch next, the FAA will find a way to keep airports open and keep air traffic controllers on the job too.

Of course, on my fledging blog I wrote about how we can cut the money from the sequester by simply stopping building Afghan infrastructure and subsidizing the Afghan security force. As an added bonus, we could cut the $1 trillion F-35 project for a plane that doesn't fly.

Henry Blodget Wants Nicer Government Choo-Choo Trains

By, Chris Rossini

The King of the Keynesian BusinessInsider appears to be in the UK where he's noticing much nicer government choo-choo trains than exist in the U.S.

In his opinion, this is a problem:
One of the most frustrating and depressing aspects of U.S. politics right now is that so little federal money is being spent on domestic public infrastructure.
I can think of a few things that are more frustrating and depressing, but we'll focus on Blodget's issue of the day instead:
We're happy to spend a staggering ~$800 billion a year on our military--another worthy cause. But we are so appalled by the amount that we spend on our domestic infrastructure that we recently chopped public construction spending from $320 billion to $275 billion a year.
One must first point out the sloppy and incorrect use of the word "we" here. The government is in no way "us".

Furthermore, every decision that the government makes is arbitrary and politicized. There are no profit and loss signals; so government is not given any clues as to where resources should be applied and where they should be removed. There are no consumers making voluntary decisions and indicating what their preferences are.

The government just turns on the tax spigot and money comes out. If the taxpayers don't pay up, throw them in a cage.

Now if the government can't know if $800 billion is too much on military spending vs. public infrastructure, how can Henry Blodget? Neither of them know.
Given our high unemployment rate and extraordinarily low borrowing costs, now would be a perfect time for the government to commit a few trillion dollars over the next decade to bringing our decaying infrastructure into the 21st Century.
Once again, there is no "our" high unemployment. Americans are not the property of the U.S. government. That may sound odd to many people, but it's true. We're forced to do certain things for sure, with the threat of violence should we not obey; but we're still not government's property. Back in the old days, such an arrangement between individuals was called "slavery", but today it's known as "civilized society".

In the real civilized society, called the marketplace, companies (that are not connected to government) religiously watch their profit and loss statements. They vigilantly monitor what their customers want and no longer want.

What if people don't want the Microsoft Zune?'s a gone. What if they want cellphones? Resources are poured into their creation.

And then there's Henry Blodget looking to throw "a few trillion dollars" around to have some people dig ditches and others fill them in. It's as if he's playing CityVille or SimCity and people are just video game abstractions waiting for him to decide on what should be done.
After all, high-quality infrastructure improves life for everyone in the country [Henry's emphasis], not just rich people or middle-class people or the other voting blocks that our two big political parties are always sucking up to.
Oh really?

And how does Blodget know that? For there are no mentions of costs. Blodget needs to read Hazlitt's Economics in One Lesson to learn about the unseen costs. The unseen costs of that "few trillion dollars" goes unnoticed.

I, for one, want my money back. I had much different plans to improve my life with it. And whoever I trade with also had different plans. The people who would've used the money to get operations had different plans, as well as those who would've bought a house, or who would've saved to start a business.

The fact that an institution that robs everyone of resources, can use those resources to build things is meaningless. What if government decided (for the benefit of "everyone" of course) to build a staircase to the moon? And to do so they would need all the resources on Earth. Would Blodget become aware of costs at that point? Maybe.
If you spend a lot of time within our country's borders, you get used to how old and decrepit much of our infrastructure is.
This also may be a surprise to people like Blodget, but everything government touches turns to trash. Everything it runs...and I use the term "runs" very a disaster.

We've all been to the schools, the post office, DMV, Social Security office, courts, airports etc....There's a reason most of us dread having to interact with any of these places. And a major reason that many of us dread that doctor's offices are heading down to the same pit.

So is it any surprise that if the government owns (which it shouldn't) "public infrastructure" that it's old and decrepit? Of course not.
I've spent the last few days in the UK, a country whose government is even more obsessed with cutting government spending than our government is. The UK is so insistent on cutting spending that it has thrown its economy into what looks like a triple-dip recession (needlessly so, in the opinion of many respected economists).

But the UK still finds money to spend on its public infrastructure...
If even the austerity-obsessed UK can buy public transportation equipment like this, can't we? Is that really so much to ask?
To think that either the US or UK is "obsessed" with cutting government spending is sheer fantasy. Neither American, nor British citizens are lucky enough to be blessed with such a situation (yet).

Furthermore, the UK government's decisions are just as arbitrary as the US governments. It's all political.

Should there be nicer trains?...or nicer roads?...or nicer bridges?

They don't know. So...the lobbyist that gets the politician the better girls wins. The crony that offers the best fishing expeditions wins.

Blodget finishes off in true SimCity fashion:
Yes, if we trim military spending, we won't be able to fight quite so many wars in so many other countries at once.

But our bridges, roads, trains, airports, electrical grids, and schools in our own country are old and deteriorating.

So even assuming that was have to cut federal spending--which I, for one (and, more importantly, many respected economists) don't think we have to--is this really the way we want to spend our money?


Or is it just that our government in Washington has become so bought-off and dysfunctional that it can't even make choices that will benefit everyone?
What's dysfunctional is the belief that government (which is at all times throwing darts into a pitch black room) should be in charge of allocating even a grain of sand.

Private Property ... Voluntary Exchange ... Prices ... Profits & Losses ... Entrepreneurship

They're the only way out.

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