Thursday, July 31, 2014

The Frontline Protection Against a Terrorist Attack in the US?

File under: Security Theater in Action

It's really a good thing that there aren't many serious terrorists (if any) in the US.

Jaison De Montalegre sends this photo taken at Grand Central Station in NYC.

Would hardcore terrorists really tremble because of these two characters?


Enemies of America: Bloomberg, Stern, and Rand Paul

By Micahel Scheuer

There must be few occasions in history when a Fifth Column was as openly disloyal and flamboyant as is Israel First in the United States, advocating at every turn that Americans become involved in wars that are none of their concern. These Jewish and non-Jewish Americans have so corrupted the U.S. political system and media that they feel perfectly at ease in acting in ways that are certain, in the future, to get some of their fellow citizens — civilian and military — killed by Islamist insurgents. They also aggressively seek to turn more of the Muslim world against the United States, thereby deepening the war America already is losing to the Islamists. And all of this is done in the name of a country that could not be more irrelevant or more detrimental to genuine U.S. national security concerns.

In the past weeks, Americans have seen Michael Bloomberg travel to Israel to lend his support to his country of first allegiance.  Bloomberg is the great, rich, soda-pop forbidding buffoon of American politics, but apparently that kind of thing sells well in Israel. He probably is only the first of the Jewish-American politicians and businessmen who will travel to Israel to showboat and tell Israelis they are there to express America’s everlasting and unanimous support for their struggling and only democracy in the Middle East. Bloomberg’s words and those of other Israel-Firsters will have no impact on the war — Israel will kill who it must, for as long as it needs to. Their words, however, will, and are absolutely meant to, further incite the Islamic world and the growing army of Islamist fighters to hate and kill Americans. The applause that the words of Bloomberg and his ilk will earn in Israel and among disloyal U.S. citizens at home will be repaid by the Islamists with bullets, bombs, and a budget-draining, bankrupting war both overseas and in North America.

Bloomberg and his comrades want Americans to believe the United States and Israel are in the same boat, that they are brothers in arms fighting ever-growing numbers of Muslim madmen. Hogwash.

Read the rest here.

Is There an Austrian Economics Mole at NPR?

Charles Goyette emails:
Bob:

I don’t know if there’s an Austrian mole in NPR, but this report is well worth a listen! 

It’s one young girl’s story about irrepressible market forces in North Korea’s command economy.  It has all the archetypal elements: the grand socialist plan, fiat currency, starvation, black markets, price discovery, bribery, the crack-up boom, entrepreneurship. 

Charles Goyette is  the NY Times Bestselling Author of, The Dollar Meltdown and
Red and Blue and Broke All Over

He hosts the Daily National Radio Commentary Ron Paul's America
Ron Paul and Charles Goyette: The Weekly Podcast
and editor of The Freedom and Prosperity Letter

Mises Makes It to the Front Page of TheStreet.com

A column by EPJ friend, Rafi Farber, written for TheStreet.com mentions Mises' Regression Theorem in relation to the crisis in Argentina:
In order for an economy to function on the most basic level, prices have to mean something. They have to make sense -- calculate values of scarce resources accurately in order to allocate them in the most efficient way. In order for them to make sense, they have to relate to something that represents the actual market. So Argentina will have to peg to the dollar once again. More precisely, it will have to peg to something with a recognized value, or its economy will not function. It can't just hand out new pesos and say "Whatever." Nobody would know what to do with them.
Austrian School economist Ludwig Von Mises called this the Monetary Regression Theorem. In order for a money to work, there has to be an existing array of prices recognized for that money in the market already. Otherwise, nothing would make any sense. You can't just have a Master of Coin from the government, go ahead and declare what prices are for everything and start handing out tickets. If that were to work at all, his price declaration would have to reflect an array already in existence. It can't be conjured out of sheer government will.
Emails Rafi:
 I wasn't expecting them to put it on the front page. But hey, I take what I can get.
Rafi's full essay is here.

Ludwig von Mises was a key architect in what has become known as the Austrian School of Economics.

-RW

Ross Ulbricht to File 'Cutting Edge 4th Amendment Privacy in the Digital Age' Motions

EXCLUSIVE. EconomicPolicyJournal.com has learned that the attorneys for Ross Ulbricht will submit,on his behalf, a new round of motions tomorrow addressing "cutting edge 4th amendment issues and privacy in the digital age."

I expect the motions to generate much discussion with regard to privacy in the age of the  internet.

The government alleges that Ulbricht was the founder and operator of Silk Road, an internet marketplace for Bitcoin transactions that allowed for the listing of all sorts of legal and illegal products, most notably drugs. Since the arrest of Ulbricht, the site has been shutdown. He is currently held without bail before trial in a Brooklyn detention facility. His trial is scheduled for Novemebr.

-RW

Here It Comes: The Judean People's Front Struggle Against Oppression

Steve Sailer writes:

Apprised that pro-abortion activists are now turning against the phrase “a woman’s right to choose” as transphobic for implying that only women can have abortions, commenter David calls our attention to this meeting of the People’s Front of Judea:

REPORT: Ebola Detection Systems Deployed in US

On April 8th Congress was informed by the the Department of Defense that because of emerging threats JBAIDS hemorrhagic fever assays have been deployed to National Guard units of all 50 States.

“By partnering with the U.S. Army Medical Research and Materiel Command and the Food and Drug Administration, we have made accessible additional diagnostic assays for high consequence, low probability biological threat agents for use during declared public health emergencies. This collaboration has facilitated the availability of viral hemorrhagic fever diagnostic assays for use during a declared emergency and adds previously unavailable preparedness capabilities to this fielded system…

To address the need for a near term capability to combat emerging threat materials, we have already provided Domestic Response Capability kits to the National Guard weapons of mass destruction civil support teams resident in all 50 states. These kits provide emerging threat mitigation capability that includes detection, personnel protection, and decontamination.”

Source Information (Via SurvivalBackPack):

I find the lead DOD involvement here, rather than the Center For Disease Control, very curious.
-RW

(ht David Jensen)

Dow Industrial Average Closes Down More Than 300 Points; What To Do

The Dow Jones Industrial Average fell 305 points, or 1.8%, to 16577, today The S&P 500 shed 38 points, or 1.9%, to 1831 and the Nasdaq Composite Index dropped 94 points, or 2.1%, to 4368.

The decline resulted in dragging the Dow and S&P 500 lower for July, leaving the blue-chip benchmark down 1.5% and the S&P 500 down 1.4%, for the month. This is the first monthly decline this year.

Who expected this?

Here's a timeline of what I wrote in the EPJ Daily Alert:

On July 11, I wrote in the ALERT:
I believe growth is too strong to start shorting aggressively, but this is no time to be accumulating stocks,aside from those that benefit from price inflation.
On July 25, I wrote in the ALERT:
The latest data from the Federal Reserve shows annualized money growth at 3.3%. This is a drop of 70 basis points since last week and a decline of 570 basis points since the peak growth rate for this cycle of 9.0%, which was reached at the start of this year. This is the 10th straight week of decline in money growth. The money growth numbers have become extremely erratic under Bernanke-Yellen. In fact, it does not appear that Yellen pays any attention to them at all.... It is very dangerous to be accumulating stocks at present, outside of those that will benefit from price inflation. I am very likely to recommend shorting the stock market if money supply growth breaks below 3%---which could occur as  early as next week...
Short-term traders should already be trading from the short side.
This Monday, I wrote:
This will be a big week for news. Because I am getting bearish, the key to trading this news, as I state above,  will be to short any upticks.
On Tuesday, I wrote this:
The two day FOMC meeting starts today, with a Fed statement on monetary policy scheduled for 2:00 PM ET tomorrow. As I indicated yesterday, short-term traders should short any strength. Aggressive traders might want to short any strength that occurs even before the FOMC statement has been released.  Yellen has proved to be quite the dynamo with her statements and comments. They have led to stock market upticks after them in the past BUT we are now in a different environment with slowing money growth and many indicators that the Fed watches signalling strength, thus any surprises may come on the down side, from a more slightly cautious Fed.
Yesterday, I wrote:
TRADING THIS MARKET
In recent days, as money growth continues to plunge, and the market looks toppy, I have switched my advice for short-term traders from one of buying dips to shorting strength.
That would have worked out well this morning after the GDP release. A stock market early rally sparked by the GDP number faded quickly. The Standard & Poor’s 500 Index (SPX) is down 0.2 percent to 1,966.43 as I write, after rising as much as 0.5 percent earlier. 
Short-term traders should continue to trade from the short side. The potential for a major break is increasing.

NOTE WELL: I don't believe what occurred today is the MAJOR BREAK, that is still ahead of us---but with price inflation heating up, there is no sure fire place to put all your assets and be comfortable.

These are extremely volatile times. Money supply growth, price inflation and the overall economy needs to be monitored very closely. I monitor these factors and more in the ALERT, with ALERTs out every day Monday thru Friday (except holidays). 

In the EPJ Daily Alert, there is commentary for short-term traders, long term investors, those holding stocks, those holding bonds, silver and gold investors, and those considering buying a house or real estate.It is the information you need to know, arriving in your email inbox daily.

There are four ways to subscribe to the EPJ Daily Alert HERE.

The Jesse Jackson Silicon Valley Shakedown

Jason Riley writes:
"There's no talent shortage. There's an opportunity shortage."

That was Jesse Jackson's attempt to justify his current shakedown of Silicon Valley, where he's trying to impose de facto black hiring quotas in the name of expanding "opportunity" for minorities. Once again, Mr. Jackson has got it wrong.

According to USA Today, whites and Asians make up around 90 percent of the staffs of Twitter,  Google, GOOGL  Facebook, Yahoo  and LinkedIn. "Of Twitter's U.S. employees, only 3% are Hispanic and 5% black," reports the paper. Let's leave aside Mr. Jackson's bizarre notion that Asian people—Chinese, Japanese, Koreans, Indians, Bangladeshis, etc.—don't bring racial diversity to a workforce. Are these numbers proof that something is amiss?..

The Journal of Blacks in Higher Education reports that "In 2005, Blacks earned 5.3 percent of all bachelor's degrees awarded in engineering. In 2012, Blacks earned only 4.2 percent of all bachelor's degrees awarded in the discipline." The Journal adds: "The news is slightly better in graduate degree awards in engineering. From 2005 to 2012, the percentage of all doctoral degrees in engineering awarded to Blacks increased from 3.7 percent to 4.1 percent."...

Silicon Valley's workforce does not reflect racial animus towards blacks. Rather, it reflects the rates at which whites and Asians are earning the requisite degrees from America's most selective institutions. Forcing Google and Yahoo to lower hiring standards in order to satisfy Mr. Jackson's definition of diversity would only slow innovation and make these companies less competitive. Let's hope they stand up to this shakedown.

If Jesse Jackson wants to impact the racial mix in Silicon Valley, he might try starting in places like inner-city Chicago, where he could devote more of his energies to convincing young black men to pull up their pants, finish school, take care of their children and stop shooting each other

Read the full commentary here.

The Worst Comment on Economics That'll You'll Read All Day

By Chris Rossini

I'll tell you, in order to be a part of what Tom Woods calls "respectable opinion" these days, you literally don't have to know anything about economics.

I have proof!

The Washington Post....E.J. Dionne...In the "Opinion" Section...I'm sure he gets paid well.

Here he goes:
For the economy and for the disadvantaged, curtailing SNAP would be devastating. While providing nutrition help to families in desperate need, food stamps also offer an immediate economic stimulus at moments when the economy is losing purchasing power. Economists call such programs “automatic stabilizers.”
Now before you hop into the shower to wash that nonsense off, let me dissect this. It's what I do.

Does E.J. Dionne expect us to believe that the economy can't exist unless money is stolen from (A) and given to (B)?

No economy without theft? Is that what I'm reading?

And E.J. is merely talking about "curtailing" food stamps. What happens if they are eliminated? Does the Earth explode?

Dionne says that "food stamps also offer an immediate economic stimulus at moments when the economy is losing purchasing power." First of all, an economy does not lose purchasing power. Fiat money loses purchasing power! If money created out-of-thin-air is used to finance the food stamps, that very act creates a loss of money's purchasing power!

What if new money isn't used though? What if it's a straight-up theft & transfer?

Does theft now provide "economic stimulus"? What an interesting point of view. Remember that if you're ever confronted by a mugger on a city street. His stealing of your money provides an "immediate economic stimulus"! He should be praised, and not cast as some sort of villain! You're the villain should you seek to curtail him.

Finally, any person that uses the words "automatic stabilizers" does not qualify in my book as an "economist". Instead, it's a person who propagandizes for the barbarians.



Chris Rossini is author of Set Money Free: What Every American Needs To Know About The Federal Reserve. Follow @chrisrossini on Twitter.




Salon Is Flipping Out Because Woody Allen Says He Would Only Use Black Actors for a Black Role

For a New York Observer profile, Woody Allen seems to make a very logical statement. Salon's Prachi Gupta  seems to have a problem with this. She writes:

But there is one very damning quote, buried toward the bottom. The profile takes a break from fawning over Allen’s celebrity friends and summarizing Allen’s continued success to address the criticism that Allen’s films rarely include people of color:
Earlier this year, in an effort to derail Ms. Blanchett’s Oscar campaign, a couple of anonymous complaints turned up in the tabloids about Mr. Allen not using black actors. He’s horrified when I bring up the subject. We talk about the new generation of wonderful black actors like Viola Davis and wonder if they’ll ever be cast in a Woody Allen film. He doesn’t hesitate to respond: “Not unless I write a story that requires it. You don’t hire people based on race. You hire people based on who is correct for the part. The implication is that I’m deliberately not hiring black actors, which is stupid. I cast only what’s right for the part. Race, friendship means nothing to me except who is right for the part.”
I wonder if she has a problem with the lack of white people in the movie Barbershop.

What Tech Jerks Can Teach Us

By Tim Harford

Fat cat bankers swimming in taxpayer subsidies. Oil barons battening on indigenous peoples. Corrupt media moguls poisoning politics. To the familiar gallery of corporate monsters, a new horror has been added: tech jerks making money through parasitic smartphone apps.

The term #JerkTech was minted recently, complete with hashtag, by Josh Constine, a San Francisco-based writer for the technology website TechCrunch. Constine pointed at ReservationHop, which aimed to make reservations at popular restaurants, then sell the reservations on to eager diners; and at MonkeyParking, which allowed people parked in a public parking space to auction it off when they left. (San Francisco’s city attorney had already sent MonkeyParking a cease-and-desist letter threatening substantial fines to users.)

There are several other examples, and it seems that the world was waiting for the word JerkTech, which spread as fast as the latest internet meme – and nothing spreads faster. Before long, both MonkeyParking and ReservationHop announced a pause for reflection.

The outrage was as much a reflection of Silicon Valley’s tarnished image as about these particular business models. Stories have circulated about a misogynistic “brogrammer” culture in some tech firms, while protesters in San Francisco have objected to Google sending free buses to the city to pick up employees, thus driving up rents. Constine himself made the link between JerkTech apps and contemptible behaviour elsewhere. As with bankers, oilmen and newspaper proprietors, the debate is emotionally charged by the broader sense that technology companies may not have our best interests at heart.

At the risk of injecting a dose of logic into the debate, it seems worth asking what exactly is objectionable about JerkTech apps themselves.

What are the common features?

Read the rest here.

Housing Market in France in ‘Meltdown’ After Hollande Rent Caps

File under: Mad economic regulation

Housing starts in France fell 19 percent in the second quarter from a year earlier, and permits -- a gauge of future construction -- dropped 13 percent, the French Housing Ministry said yesterday.

Bloomberg reports, the rout stems from a law this year that seeks to make housing more affordable by capping rents in expensive neighborhoods. The law boosted the number of documents that must be provided by sellers, leading to a decline in home sales and longer transaction times.

“Construction is in total meltdown,” said Dominique Barbet, an economist at BNP Paribas in Paris. “It’s difficult to see how the new housing law is not to blame.”

How a Former Denny's Waitress Amassed an Empire of Over 75 Denny's Locations

By Jason Daley

Dawn Lafreeda began working at a Denny's in California at 16, making her way from hostess to waitress. During college, she took on a second job at a software company, where she learned about accounting and managing personnel.

In 1984, when she was 23, Lafreeda was able to merge all her skills when she had the opportunity to purchase a Denny's restaurant in the tiny mining town of Globe, Ariz. She jumped at the chance. "I knew from a young age I was going to own my own business," she says. "I always knew I was going to be self-employed."

Eighteen months later, impressed by what Lafreeda had accomplished, Denny's offered her four ailing restaurants in west Texas. It was a challenge whipping the stores into shape, but for Lafreeda the biggest hurdle was culture shock--she wasn't prepared for the area's depressed economy and arid landscape. Every week she called Denny's executives and asked them to sell her a store in the big city of San Antonio. Eventually they did, and since moving there, Lafreeda has increased her empire to 75 Denny's locations in six states, becoming the largest single-owner franchisee in the system.

We got Lafreeda to tell us how she has built her empire over the past three decades.

You bought a restaurant at 23? That's pretty gutsy.
When you're 23 you don't think the same way you do when you're older. You're fearless and think you can do it all. It empowered me. I was too ignorant to know any better. I remember having a moment of doubt. I told my mom, "I have 35 employees depending on me; what if I fail?" She said, "You'll just start over."

How were you received as a young, female business owner?
I didn't feel discrimination, but when I was 23 I looked like I was 12. Nobody took me seriously. I'd go to the bank for a loan, and they wouldn't believe I was the owner. I just kept forging ahead until I found people to deal with. I wouldn't let no be an answer.

Read the rest here.

Big Spenders: Lobbying by Industry


Health Professionals
$119,470,003
Pharmaceuticals/Health Products
$78,046,383
Insurance
$73,703,878
Business Associations
$71,804,106
Computers/Internet
$67,265,741
Oil & Gas
$65,871,155
Electric Utilities
$57,022,334
TV/Movies/Music
$49,900,734
Securities & Investment
$47,542,373
Misc Manufacturing & Distributing
$45,341,903
Health Professionals

The Ron Paul Institute Gets Noticed

The mainstream economics journalist and former Boston Globe columnist David Warsh writes:
It is a busy summer.  Economic Principals has many pots upon the stove and relatively little time to read the papers. That seems just as well most days. The news from Gaza, Ukraine, and the southern border of the US is uniformly heartbreaking.
I do, however, find time to look at Johnson’s Russia Listwhenever a new edition arrives.
David Johnson, EP readers may remember, is a longtime student of the former Soviet Union who since 1996 has tracked, more or less daily, what is written about Russia in the Western and the English-language Russian press. Johnson faithfully reproduces virtually all points of view, and only occasionally and gently intrudes his own, in the form of short precedes to the list.
““What we need is a comparative analysis of current levels of ‘nationalist hysteria’ in Kiev and Moscow so that an informed comparison can be made…. Where is I. F. Stone when we need him?” Johnson asked the other day, reflecting the fact that no persistent voice has yet emerged critical of the US stance. (I notice, though, that he  has begun to occasionally list relevant items  from the Ron Paul Institute.)

Thank God for Elizabeth Warren

By Victor J. Ward

I have been working on a piece regarding reparations. That, plus the general busyness of life has kept me from writing. But, a couple of articles on EPJ got me thinking about some things. One was Bob's post about Ron Paul's comment that people are born libertarians. The other was the post about Elizabeth Warren's 11 rules for Progressives.

I like to say that I graduated in the top 99% of my law school class. Some people get confused and think that that is really good. If you graduate in the top 10% of your class, that's really good. If you graduate in the top 25%, that's pretty good. If you graduate in the top 50%, you usually don't talk about it. If you graduate in the top 99%, well, enough said.

When I was in law school, there were many opportunities that I could have taken -- even for a poor student -- and those opportunities could have paved the way for my legal career. But, I did not know of said opportunities, and I was too ignorant or proud or embarrassed or some combination of the above to ask about said opportunities.

I took the Bar exam six times before I finally passed.

Before passing, I can remember driving around

Wednesday, July 30, 2014

Just Announced: George W. Bush's Personal Biography of His Father, George H. W. Bush

A title has not yet been chosen. I humbly suggest: Daddy Issues: Why I Attacked Iraq

From the news release:
Forty-three men have served as President of the United States. Countless books have been written about them. But never before has a President told the story of his father, another President, through his own eyes and in his own words. A unique and intimate biography, the book covers the entire scope of the elder President Bush’s life and career, including his service in the Pacific during World War II, his pioneering work in the Texas oil business, and his political rise as a Congressman, U.S. Representative to China and the United Nations, CIA Director, Vice President, and President. The book shines new light on both the accomplished statesman and the warm, decent man known best by his family. In addition, George W. Bush discusses his father’s influence on him throughout his own life, from his childhood in West Texas to his early campaign trips with his father, and from his decision to go into politics to his own two-term Presidency.
The scheduled publication date is November 11. 2014

What’s Wrong With Global Warming?

By Greg Morin

They keep saying climate change is “settled science” but I don’t think they know what that means. chemical bonding theory is settled science. gravitational theory is settled science. laws of motion is settled science. the weight of an electron is settled science. Why? Do you hear anyone debating these things? No, because they are based on reproducible results that allow one to make accurate, testable predictions 100% of the time.

No one disagrees that CO2 is a greenhouse gas, so yes, that’s settled. The disagreement is over the degree of positive or negative feedback that will either attenuate or accentuate the effect of increasing greenhouse gas. And since the models haven’t accurately predicted the current pause in the rise in temperature for the last 15 years or so, then I guess something is wrong with the models isn’t it? Doesn’t seem very settled to me.

But that’s just one side of the issue. Even if it were definitely proven that temperature would rise 2°C by the end of the century, the rest of what follows, that is, wild predictions of famine, crop failure, etc is not “science” and it certainly isn’t settled. It is simply speculation based on a simplistic analysis (hot=dry=dead). But of course we need these wild predictions of impending doom, since if the scientists said temperature would go up but that’s about it we would all just shrug our shoulders and move on. The political class always needs an excuse to “do” something and this is the perfect one.

For some reason the well recognized fact that rising temperatures lengthens the growing season and expands the regions that support farming further northward is simply ignored in this analysis…it’s the usual sort of analysis you see from the Keynesian economists wherein they only highlight the seen effect they wish to focus on and ignore the unseen effects that don’t fit their desired narrative.

The above originally appeared at LewRockwell.com

Woha: Ruling Against McDonald’s Could Open Door for Union Instigation All Over the Place

NYT reports:
The general counsel of the National Labor Relations Board ruled on Tuesday that McDonald's could be held jointly liable for labor and wage violations by its franchise operators — a decision that, if upheld, would disrupt longtime practices in the fast-food industry and ease the way for unionizing nationwide.

Business groups called the decision outrageous. Some legal experts described it as a far-reaching move that could signal the labor board's willingness to hold many other companies to the same standard of "joint employer," making businesses that use subcontractors or temp agencies at least partly liable in cases of overtime, wage or union-organizing violations...

The fast-food workers who filed cases asserted that McDonald's was a joint employer on the grounds that it orders its franchise owners to strictly follow its rules on food, cleanliness and employment practices and that McDonald's often owns the restaurants that franchisees use.

McDonald's said it would contest the decision, warning that the ruling would affect not only the fast-food industry but businesses like dry cleaners and car dealerships.

Heather Smedstad, a senior vice president for McDonald's, said the N.L.R.B.'s move was wrong because the company does not determine or help determine decisions on hiring, wages or other employment matters. "McDonald's also believes that this decision changes the rules for thousands of small businesses, and goes against decades of established law," she said.

Former IRS Official Calls Conservatives ‘Crazies’ and Worse in Newly Released Emails

Former IRS senior official Lois Lerner apparently believed conservatives were “a–holes” and “crazies,” according to emails released by the House Ways and Means Committee today, reports ABC News.

In a letter to Attorney General Eric Holder, committee chairman Rep. Dave Camp, R-Michigan, released a redacted email exchange from Lerner’s official IRS email account that Republicans believe shows she held personal bias and hostility against conservatives.

In the Nov. 9, 2012 email evidently sent while Lerner was vacationing in England, she appeared to refer to conservatives as “a–holes” and suggest they could cause the downfall of the federal government.

“So we don’t need to worry about alien teRrorists. (sic) It’s our own crazies that will take us down,” Lerner wrote in an email to a recipient whose identity was redacted.

Rutherford Institute Defends Florida Mom Arrested, Handcuffed, Searched & Jailed for Allowing Her 7-Year-Old Son to Visit Playground Alone

 Attorneys for The Rutherford Institute have come to the defense of a Florida mother who was arrested and charged with child neglect for allowing her 7-year-old son to visit a neighborhood playground located a half mile from their house. For the so-called “crime” of allowing her son to play at the park unsupervised, Nicole Gainey was interrogated, arrested and handcuffed in front of her son, and transported to the local jail where she was physically searched, fingerprinted, photographed and held for seven hours and then forced to

The Question Not Put to the Admiral

Following remarks, yesterday, at the Commonwealth Club by Former Chief of US Naval Operations, Admiral Gary Roughead (SEE: The Shocking Direction That the US Military Is Headed). A question and answer period ensued.

Unfortunately, the questions are moderated.You have to write the questions on a card and they are then filtered by a moderator. The moderator yesterday was Jeffrey Bleich, Former U.S. Ambassador to Australia; Partner, Munger, Tolles & Olson and former Special Counsel to the President (Obama).

Bleich seemed to have worked his way through all the cards last evening, but apparently didn't deem it worthy to ask the former naval commander to comment on this request I submitted to the admiral.
Could you compare and contrast the US Navy shootdown of the Iranian civilian Air Flight 655 to the shootdown over Ukraine of Malaysian civilian flight MH17.
-RW 


On Dominoes, WMDs And Putin’s “Aggression”: Imperial Washington Is Intoxicated By Another Big Lie

By David Stockman

Imperial Washington is truly running amuck in its insensible confrontation with Vladimir Putin. The pending round of new sanctions is a counter-productive joke. Apparently, more of Vlad’s posse will be put on double probation, thereby reducing demand for Harry Macklowe’s swell new $60 million apartment units on Park Avenue. Likewise, American exporters of high tech oilfield equipment will be shot in the foot with an embargo; and debt-saturated Russian state companies will be denied the opportunity to bury themselves even deeper in dollar debt by borrowing on the New York bond market. Some real wet noodles, these!

But it is the larger narrative that is so blatantly offensive—that is, the notion that

The Great Country of Austria

By Mark Nestmann

This week, I’m writing to you from the departure lounge of the Vienna International Airport.
I lived in Austria from 2003-2005. I returned not only to renew old friendships, but to see firsthand the latest developments in this small country, which only a century ago dominated much of Europe.
The airport has changed a great deal in the nearly 10 years since I left. It’s expanded and made itself much more accessible to business travelers like me.
And Austria itself has changed too. Judging from what I’ve seen, the population is remarkably tolerant of cultural and political differences. Indeed, the most famous Austrian today appears to be a transvestite who calls herself Conchita Wurst.
But xenophobia is on the rise in Austria (as in much of Europe). The anti-immigration, rightwing Freedom Party (FPÖ) made big gains in the 2013 elections.
In recent years, immigrants, both legal and otherwise, have overwhelmed Austria. It’s easy for citizens of EU countries to relocate to, and work in, the country. Thousands of people from the newest EU members – Romania and Bulgaria – now make their home here.
Yet with continuing illegal immigration from Russia, Libya, and other countries, this influx has imposed great strains on Austria’s generous social services network. As a result, it’s become harder for “outsiders” without EU passports to obtain residence visas.
In most cases, residence applications from outside the EU are subject to quotas. And to stay in Austria legally, you must eventually become proficient in German.
I left Austria in 2005, because I couldn’t find a way to qualify for residence without spending a great deal of money in legal fees. But every time I return, there’s a part of me that wishes I had stayed.
Mercer’s, a major human resources consultancy, ranks Austria’s historic capital of Vienna as the world’s most livable city. As a former resident, I can attest to the fact that Vienna is an extraordinarily attractive place to live – and to visit.
On the evening I arrived last week, I walked from my hotel in the central district to the City Hall (Rathaus). Every summer evening, weather permitting, musical and theatrical productions are screened on an open-air video wall in front of this immense neo-Gothic building. Admission is free, and dozens of food stalls serve food and drinks. There’s nothing like settling in for an opera screening, accompanied by Wiener Schnitzel and an Ottakringer beer.
If you qualify, after 10 years of permanent legal and uninterrupted residence, you can apply for Austrian citizenship and passport. You must demonstrate fluency in German; pass a test on Austria’s history, constitution, and geography; have a clean criminal record in the country; and possess a “positive attitude” toward Austria.
Austria also has an accelerated citizenship option in its immigration law, although it’s not a “program,” as such. You may qualify for “instant” Austrian citizenship and passport by performing extraordinary achievements in the interest of Austria. If you’re a famous scientist, opera singer, or sportsman and relocate to the country, you may qualify. But most of the handful of individuals awarded citizenship annually under this option make a hefty contribution to support or rehabilitate an Austrian cultural, religious, or historical facility or location – generally in the €2 million (US$2.7 million) range.

Booming Economy

Austria’s official economic forecast predicts the nation’s economy will grow only 2-3% in 2014. But in Vienna, business is booming. Of course, visiting this city in the midst of tourist season exaggerates the underlying economic activity. Even beyond the tourism-focused city center, the signs of growth are everywhere. Vienna recently extended its U-Bahn (subway) network. One route now extends northwest out to a new city being built from the ground up: Seestadt, or Lake City. Here, more than 10,000 new apartments are being built with an estimated 20,000 jobs created.
It makes sense to build on the city outskirts, as land and property in the center have become very expensive. A real estate magazine in my hotel room featured dozens of listings in the city center… with a starting price of €1.9 million. But prices are rising in the suburbs as well. A friend I met for dinner told me that the apartment he had purchased in 2005 about six miles outside the city center for €160,000 had nearly doubled in value.

Banking Options for Americans

Austria has also evolved into a sophisticated international banking center. While Austrian banks don’t have as many foreign clients as Swiss banks, virtually every banking and brokerage service you can imagine is available. Banks in Austria offer similar services as those in Switzerland, but at a lower cost and, historically, with a somewhat lower profile.
Unfortunately, the vast majority of Austrian banks – and non-US banks in general – no longer deal with Americans. I wrote about the reasons for this exclusion here. During my visit to Austria, I met with the two banks in Vienna that I have confirmed will work with US clients. One of them does so with reluctance and requires a personal visit – although the minimum investment is as low as €1,000. The second bank works through a network of agents – including The Nestmann Group – but requires a minimum investment of $500,000.
But if you’re simply looking for a place to store your valuables – precious metals, jewelry, etc. – there are opportunities to do so that are far more accessible to US clients. I met with two private vault services during my visit that offer affordable, secure, and (in one case) completely anonymous storage opportunities.
Little Austria has come a long way since the last Soviet soldiers pulled out in 1955. While it’s hardly a tax haven, over the decades, it’s become an extremely attractive place to live, invest, and do business. If you haven’t been here, I highly recommend a visit… and while you’re here, raise a Prost (toast) to this unique country.

Mark Nestman writes the Nestmann Notes.

The Shocking Direction That the US Military Is Headed In

By Robert Wenzel

 Admiral Gary Roughead
I have long held the view that perhaps the most despicable action taken by Ronald Reagan, while he was president, was ordering the invasion of the tiny island of Grenada.

Ten years ago, in 2004, I wrote:
Following the disaster in Vietnam, United States citizens were, in general, not in favor of United States military adventures in foreign lands. The public had had it with war. Ronald Reagan changed this with the invasion of Grenada. It is my contention that Reagan's invasion of Grenada was the first step in United States post-Vietnam military adventures. It was an important step and Reagan started it all. It was the taste of victory against the tiny island of Grenada that set the stage for the invasion of Panama, Iraq War I and the current occupation of Iraq. Reagan's adventure into Grenada and its quick victory wiped out the hesitation to go to war that the Vietnam experience engendered in the masses.
I have never heard the view advanced by anyone else, that is, until yesterday.

Former Chief of US Naval Operations, Admiral Gary Roughead, spoke in San Francisco at The Commonwealth Club, yesterday evening. He was formerly a member of the US Joint Chiefs of  Staff  and is one of only two officers in the navy’s history to have commanded both the Atlantic and Pacific Fleets. He is currently at the Hoover Institution.

During his speech yesterday, he mentioned that the Vietnam War had left an anti-war taste in the mouths of Americans and said that didn't change until the invasions of Grenada and Panama. "We had short quick interventions that showed we we're back," said Roughead. Indeed, it did. Now the US military is all over the damn globe.

He identified the Middle East and Asia as continuing trouble spots. He also said that he feared an incident may occur between China and Japan. He said the two countries hate each other and that they have developed no local level or national level relationships that might head off an escalation in the event of an incident.

He specifically noted that both countries have very fast, very powerful military planes that are flown by young patriotic pilots that could someday be the source of an incident.

He also warned of a future "10th Parallel" problem. He noted that the 10th parallel north is a circle of latitude that is 10 degrees north of the Earth's equatorial plane and crosses Africa. He called it a fault line and specifically singled out the countries of Nigeria, Chad,  Guinea and Sierra Leone, where problems are likely to develop.

But what really caught my attention in the Admiral's comments was his views on the way he saw the US military developing. He said he joined the military at a time when there was still a draft and that he saw it go from that to a volunteer military. But he said there was going to be a next step. He said the military had gone from draft to all volunteer and will in the future go to an "all professional force."

He said the pay structure of the military must be restructured so that military personnel are paid more. And then he dropped this line, which shocked me.

The new all professional army "will be somewhat isolated from the population, highly trained, highly compensated,"  he said.

It sounded as though the military is setting up to be a very elitist organization.

We now see, on a daily basis, news of how the new militarized local police departments act in a superior elitist manner, abusing individual rights. Gone are the days of the friendly cop on the corner. And now, apparently, the military wants to trump this local police militarization by becoming some type of super elitist group that is "somewhat isolated from the population." Very scary. Do we really want a military that is highly compensated but considers itself elitist and superior to the general population?

Be warned. When you start to see calls in Congress for increases in military compensation, you now know where that is headed.

Robert Wenzel is Editor & Publisher of EconomicPolicyJournal.com and author of The Fed Flunks: My Speech at the New York Federal Reserve Bank.

Mothers Beating on Politician

Daniel McAdams writes:
Here is another rally in Ukraine against the [military] mobilization order, from yesterday. This time the residents are so angry at their parliamentary representative (who according to the video hails from the extremist Svoboda party) for attempting to send their sons off to war that they actually rough him up. The best part is around the :56 mark, where the mothers start shoving the politician and yanking on his ponytail.
Here is a google translation of the youtube summary of the video:
Novoselitsk recruiting office near rally against mobilization. Enraged residents beat Bandera deputy Ivan Papadyuka that threats forced residents to go to war. 

Guess What Happened to that Guy Who Claimed His Father Owned "Half of Fucking Manhattan?"

Gerry Shalam, the 20-year-old NYU student caught on camera pretending to be the heir to a massive real estate empire—"half of fucking Manhattan," is now an intern with Judge Esther Morgenstern of Brooklyn's Integrated Domestic Violence Court, reports NyPo.

A few weeks back, Shalam and foriends, including one who was very drunk, were videotaped by a passerby. He told the videotaper that he came from a wealthy real estate family that had influence with the NYPD and Mayor Bill DeBlasio.

“Do you want me to call f–king Bill de Blasio on you right now? He’s a f–king liberal, but I’ll f–king call him.”

When asked his name, Shalam responded, “Gerry Adjmi,” adding later that “I’m a fucking lawyer.”

The video (below) went vial.

Shalam used a phony surname because it is his friend--who collapses to the pavement at one point--is himself an Adjmi, a wealthy New York real estate family. In the real world,Shalam's father Lou is a garment industry executive, and his mother Frieda is an event coordinator and member of the Allenhurst Borough zoning and planning board.  But it does appear he does have low level government connections to land the internship.


The Real Reason Harry Truman Backed a Jewish State

By Michael Rozeff
A recent article in New Republic goes into some detail about Harry Truman’s preferences concerning Palestine and a Jewish state. The article provides quite a bit of evidence that Truman didn’t want a Jewish state. He preferred other setups like a federated or binational Palestine. Truman told one delegation of Jews that “the government of Palestine should be a government of the people of Palestine irrespective of race, creed, or color.” He recognized the dangers of a religious state and he recognized the severe shortcomings of Israel’s leadership. Why then did Truman end up recognizing Israel? It was because of the Jewish vote in critical states and the capacity of American Jews to launch a campaign against him if he did not recognize Israel.
Politics constantly produces dysfunctional outcomes on any issues that enter the political arena. This story of Israel’s recognition by Truman is an example. Politics doesn’t produce “solutions” to any issues or problems. It produces winners and losers, impositions, edicts backed up by force, stupid outcomes, folly, deadweight losses, frictions, battles, wars, destruction of markets, cultural hatreds, widespread unhappiness, wealth destruction, and irrational outcomes. These often go on for generations, with one injustice creating further injustices. The politics exemplified by the behavior of states is a real bummer.
Minarchists and anarchists agree on one thing, which is that the state’s capacity to rule on “issues” and “problems” should be vastly reduced. Peoples everywhere, in their own interests, should be actively seeking to remove issues from the political arena, not introduce issues and problems to that arena. They should be actively seeking to reduce the state’s powers.
The above originally appeared at LewRockwell.com.

Paul Ryan's Horrible Budgets

Laurence Vance emails:


You mentioned Paul Ryan and his new plan. Here are some of my articles on Ryan's horrible budgets:

 Laurence M. Vance is a columnist and policy adviser for the Future of Freedom Foundation, an associated scholar of the Ludwig von Mises Institute, and a columnist, blogger, and book reviewer at LewRockwell.com. He is also the author of Social Insecurity and The War on Drugs Is a War on Freedom. His newest books are The War on Drugs Is a War on Freedom; His most recent books are: War, Christianity, and the State: Essays on the Follies of Christian Militarism and War, Empire, and the Military: Essays on the Follies of War and U.S. Foreign Policy

Hey Paul Krugman, U.S. Inflation Accelerated Sharply in Second Quarter

Inflation as measured by the Federal Reserve's preferred price index surged in the second quarter to the highest annual rate in three years.

The Personal Consumption Expenditure index (PCE) rose at a 2.3% annual rate in the April-to-June period, compared to 1.4% in the first quarter. The so-called core PCE that excludes food and energy climbed at a 2% clip, up from 1.2%.

The PCE is a measure of price changes in consumer goods and services. Personal consumption expenditures consist of the actual and imputed expenditures of households; the measure includes data pertaining to durables, non-durables and services. It is essentially a measure of goods and services targeted toward individuals and consumed by individuals.

I wonder if Krugman still thinks deflation is the concern.

In the EPJ Daily Alert, I am warning that price inflation is likely to accelerate much quicker than most expect. I also warn that the Fed, despite their supposed price inflation "target" of 2.0%, really has a target of 3.0% and that they will be very slow to respond the inflation. Their actions will be too little, too slow.

-RW

At an 1865 Gathering of the Massachusetts Anti-Slavery Society...

By Walter E. Williams

While reading the first chapter of Jason Riley's new book, "Please Stop Helping Us," I thought about Will Rogers' Prohibition-era observation that "Oklahomans vote dry as long as they can stagger to the polls." Demonstrative of similar dedication, one member of Congress told Vanderbilt University political scientist Carol Swain that "one of the advantages and disadvantages of representing blacks is their shameless loyalty. ... You can almost get away with raping babies and be forgiven. You don't have any vigilance about your performance." In my opinion, there appear to be no standards of performance low enough for blacks to lose their loyalty to their black political representatives.

Riley says that between 1970 and 2001, the number of black elected officials skyrocketed from fewer than 1,500 to more than 9,000, but black poverty has remained roughly the same. Between 1940 and 1960, when black political power was virtually nonexistent, the black poverty rate fell from 87 percent to 47 percent. Riley points out that there has been significant achievement among the black middle class but that wide black-white gaps remain with respect to income, educational achievement, unemployment, labor force participation, incarceration rates and other measures. Despite political gains, there have been dramatic reversals in teen unemployment, crime, out-of-wedlock births and family stability. Political power is neither a necessary nor a sufficient condition for socio-economic progress.

Riley lays out the devastating deal black political leaders and civil rights leaders have made with labor unions, in his aptly named chapter "Mandating Unemployment." Black leaders of the past recognized that labor unions were hostile to the interests of ordinary blacks. Frederick Douglass, in his 1874 essay "The Folly, Tyranny, and Wickedness of Labor Unions," argued that unions were not friends of blacks. W.E.B. Du Bois called unions "the greatest enemy of the black working man." Booker T. Washington also opposed unions because of their adverse impact on blacks.

Today's black leaders have little reservation about giving their support to union policies that harm their constituents. They support minimum wage increases, which have had a devastating impact on black employment, particularly that of teenagers. Recently, black teen unemployment reached 44 percent, but few people realize that during the late 1940s, before rapid minimum wage escalation, it was less than 10 percent and lower than white teen unemployment. Black leaders also give their support to a super-minimum wage law known as the Davis-Bacon Act of 1931. The legislative history of Davis-Bacon makes clear that its union and congressional supporters sought to eliminate black employment in the construction trades.

Riley's "Educational Freedom" chapter details the sorry story of black education. Between 1970 and today, educational spending has tripled and the school workforce has doubled, far outpacing student enrollment. Despite these massive increases in resources, black academic achievement is a national disgrace. According to the National Assessment of Educational Progress, known as the nation's report card, black 17-year-olds score at the same level as white 13-year-olds in reading and math. White 13-year-olds score higher than black 17-year-olds in science.

A number of studies show that black students who attend private and charter schools do far better than their peers in public schools. If there were greater parental choice, through educational vouchers, black achievement would be higher. However, teachers unions see school choice as a threat to their monopoly, and virtually every black politician, including the president, backs the teachers unions.

At an 1865 gathering of the Massachusetts Anti-Slavery Society, Douglass said everybody had asked, "What should we do with the Negro?" Douglass said: "I have had but one answer from the beginning. Do nothing with us! Your doing with us has already played the mischief with us." Later on, Washington explained, "It is important and right that all privileges of the law be ours, but it is vastly more important that we be prepared for the exercise of these privileges." It's the abandonment of these visions that accounts for the many problems of today that Riley's book does a masterful job of explaining.

Walter E. Williams is a professor of economics at George Mason University and author of Race & Economics: How Much Can Be Blamed on Discrimination?

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Is Hal 9000 on the Way?

By Robert Ringer

Like most people over sixty, I have a love-hate relationship with computers. I guess I’m lucky to have been able to jump on the caboose of the computer train just in the nick of time, back in 1982. By just in the nick of time, I mean that I was still young enough to become proficient on a computer, something that would have been considerably harder to do had I waited another ten years or so.

It never ceases to amaze me how, with a computer, I can do in minutes what used to take hours — or even days. Basically, my computer has become my brain. Because I put a lot of work into organization, there aren’t many files or documents that I can’t find in seconds. It sure beats having rows of file cabinets filled with paper, and, even just as important, it beats having to rely on your brain to remember things.

Back in the day, whenever I received a letter, resume, contract, or some other written document in the mail, I could tell a lot about the person who crafted it. When people had to create documents without artificial aids, it was easy to make an initial separation of the wheat from the chaff.

But today, everyone’s work looks professional. So much so that I don’t allow myself to be impressed just because someone’s computer-generated document sparkles. The Internet is overflowing not only with readymade resume templates, but every conceivable kind of form, so there’s very little knowledge or skill required to put together a great looking document. And that’s what’s bothersome to me — the fact that in today’s digital world a person doesn’t need much skill or knowledge to navigate through and around the checkpoints.



Take the GPS, for example. I don’t use a GPS, because I’ve always carried around a map in my head while driving. If you know where the sun is, and approximately what time of the day it is, you know where east, west, north and south are (or at least you should). Nighttime is a bit more challenging, but so long as that map is in your head, you’re usually in good shape.

Today, millions of people — especially young people — have no clue how to

Tuesday, July 29, 2014

States Where People Have the Fewest Debt Problems

States in which people have a high percentage of debt in collection tend to be those where the recession damaged people’s financial situation the most, according to a new report from the Urban Institute:
Nevada, which was hard hit by the housing crisis, tops the list of past-due states: 47 percent of people with a credit file have reported debt in collections. The District of Columbia and an additional 12 states (11 in the South) are over the 40 percent mark: Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, New Mexico, North Carolina, South Carolina, Texas, and West Virginia.
On the other end of the spectrum,, in some states, the figure is about half of Nevada’s. The 10 lowest include: North Dakota (19.3%), Hawaii (22.7%), Nebraska (23.9%), Minnesota (19.8%), Montana (26.2%), Connecticut (26.2%), South Dakota (20.8%), Iowa (26.3%), Massachusetts (23%) and Vermont (23.7%). A review of unemployment by state in June shows that North Dakota, Nebraska, Vermont, South Dakota, Montana, Minnesota and Iowa all have unemployment rates at or below 4.5%.

(Via 24/7 Wall Street)

Imagine If ATMs Told You They Will Not Give You Cash for 10 Days

Stephen Foley at FT comments (my emphasis) on the new "crisis-time" restrictions available to MMF managers:
It is irritating enough here in the US to have to pay $2 or more to get money out of a cash machine, if there happens not to be a bank branch handy. Imagine if the machine also told you it will not give you the cash for 10 days.

These aggravations – fees and withdrawal restrictions – will soon be threatened by money market mutual funds, which millions of American investors use as a kind of higher interest-bearing savings account...

Last week, the Securities and Exchange Commission approved a slew of new rules covering the $2.6tn MMF industry. After years of controversy and intense lobbying, it was surprising that fund managers reacted with statements of broad support. One potential explanation for the outbreak of peace is that asset managers view the SEC’s decision as advancing a broader agenda, namely to win more discretion for managers over when and how their investors are allowed to pull money out of funds.

The SEC’s thinking will inform forthcoming debates about how to limit systemic risk and prevent runs across the fund management industry. The conclusion it came to in this case might actually have made runs more likely, not less.

Under the new rules, MMFs that hold corporate or municipal government debt will be allowed to charge a fee for withdrawals or even halt them altogether by putting up gates for up to 10 days, should market liquidity dry up or the fund get into trouble...

Giving fund managers discretion to halt redemptions is superficially attractive, especially given the fiduciary duty to protect investors in their funds.

The trouble is that many investors cannot countenance the risk of losing access to their money, and nor should they. It is as frightening an idea to them as the cash machines stopping working.

What will happen? As market stress rises, it becomes more likely that a fund will erect gates, and the incentive to get out kicks in even earlier. This was a warning made by Federal Reserve governors to the SEC last year, which has been ignored.

We may ultimately find that the SEC has increased rather than decreased systemic risk and, more worryingly, opened the intellectual door to further moves in this wrong-headed direction.
I warn once again, there is simply no advantage to keeping funds in a money market fund, at this time, versus at an elitist, establishment bank account. Your money will be much more liquid and safe at Wells Fargo, Chase or Citi versus in an MMF. The establishment is in charge.

-RW

Mitch McConnell Leads Alison Lundergan Grimes for First Time in Poll

Senate Minority Leader Mitch McConnell leads Democrat Alison Lundergan Grimes in the Bluegrass Poll for the first time, reports MarketWatch and National Journal has several important takeaways for the closely watched race. Among them: that McConnell is gaining ground, even though his lead is just two points. He trailed Grimes by four points in February and one point in May. Further, Grimes is winning women voters by just a single percentage point. To win in November she likely needs to win more women. The poll is sponsored by four media organizations in Kentucky.