Monday, October 31, 2005

Train Wreck of the Week Train Wreck of the Week By Bob Chapman
October 29 2005
An attorney for Center for Constitutional Rights visited 10 of her clients at Guantanamo. There are more than 500 people there, 100 are on a hunger strike. Doctors (?) and six men are holding down the detainees, shoving a huge over sized tube down their throats and forcing food in. They use the same tube with blood, mucous and bile on the next sanitation. The detainees most of whom have been there for 4 years, have no hope of getting out and therefore want to die. The government refused yesterday to accept the findings of the attorneys and has refused to allow any freedom of information requests to be involved.
The attorney was forbidden to name the Doctor in charge (even his name has been reported by Amnesty and other civil rights groups). WE ARE INDEED RUNNING A GESTAPO LIKE GULAG IN GUANTANAMO.
Again the drive to privatize water distribution and resources in Latin America is gaining momentum. Although transnational water companies have suffered setbacks in Puerto Rico, Bolivia and Uruguay, they continue to lay plans to appropriate (steal) the region’s hydrological resources – rivers, aquifers, wells and aqueduct systems. The crooks now call privatization decentralization, civil society participation and sustainable development. They had better make up euphemistic labels to hide what they have done in the past.
Due to the dreadful experiences of the past, at the hands of transnational elitist corporations, last April 400 participants from Mexico and countries throughout the hemisphere met in Mexico City at the First People's Workshop in the Defense of Water. They discussed methods toward consolidating and furthering the defense of water as a human right for everyone.
In Latin America their politicians as usual are selling people out. There is no reason to bring in outside capital and control. Get a loan and tax your own citizens to pay for construction and distribution.
There is nothing risky or expensive in pumping and distributing water once it has been located. International conglomerates would like you to believe the opposite to pad the bottom line. In fact, these transnationals collude with each other and divide global markets.
The main reason these corporate water companies are able to access foreign markets is because of political corruption, incapacity and lack of investment in infrastructure, but also via the promotion of ridiculously cheap water, which results in waste and the lack of real cost for water.
We are seeing record home building financed by a wall of money from the Fed, some two million new units a year in the midst of a rising inventory of unsold homes. Most of these dwellings are upscale and oversized, and most are being built in hot markets. This puts the construction industry at risk as well as the banking system as the GSE’s Fannie Mae and Freddie Mac have been told to lighten up on their lending. Banks probably will end up in serious financial trouble, as did the S&L’s in the 1980s. Our bubble economy has become acutely susceptible to any slowdown or interruption in credit creation or system liquidity. That is why we publish those statistics every week. That is also why we believe any new chairman of the Fed cannot change the course. Liquidity has to increase on a net bases of 12% or the system collapses. Guess what, it is going to collapse anyway. All the elitists are doing is buying time. The more money and credit infused into the system, the more inflation and the lower the dollar goes and the higher gold and silver goes. Subscribers, you are looking at a classic credit bubble. We like to compare this monstrosity to 1994-95. Yet, the debt exposure was nothing like today. Oil was $18.40 a barrel and natural gas was $1.69. If we had gone through a solid deep recession in 1989-95, we wouldn’t be facing depression today. The comparisons are stark. Today oil is over $60.00 and gas is over $13.00, and we are buried in debt. There is no way out.
From 1990 through 1994, our current account deficit rose $325 billion. Over the past five years, it has swelled to $2.5 trillion, and will soon pass $800 billion annually. This is the key defining issue because it affects our ability to borrow over $3 billion a day and it dictates higher interest rates. It also affects the value of the dollar in a negative way.
The current weakness in the economy is not an interlude; it is the beginning of a painful correction. The inflation you see is not transitory. It will be with us for at least the next 1 1/2 years and perhaps a lot longer dependant on how the Fed reacts. The Fed cannot stop it. If they do they will totally lose control. This is inflating to the bitter end. Our deficits and debt are simply unsustainable and sooner or later the dysfunction will end.
Markets are turning hyper-volatile. The Dow goes up 130 points in a day and falls 130 points the next day. Gold is even volatile, up $6.00 and down $6.00. In 15 minutes the 10-year Treasury’s rose from a yield of 4.50% to 4.42% and ended the day at 4.38%. These are signs of instability. Markets will get more and more volatile and unpredictable as we go forward.
In typical neocon fashion our government has reneged on the $15,000 bonus promised to National Guard and Reserves reups. What can you expect from lying, thieving crooks.
Robin Raphel, the State Department’s coordinator for Iraq assistance, said, “the invasion’s timing was driven by ‘clear political pressure’, as well as the need to quickly deploy the US troops that had been amassed by the Iraq border.” It was as well clearly amateur hour.
Raphel, a 28-year veteran of the State Department’s foreign service and a former assistant secretary of state said that veteran diplomats who were sent to Iraq early in 2003 shared a view that “we were not prepared.” We should have waited 6 months and built an international coalition. The decisions were ideologically based. They were not based on analytical, historical understanding.
Government veterans who were sent to Iraq a part of the US mission also were convinced that “we cannot remake other countries in our image in terms of democracy or capitalism or things like that” said, David Dunford, a State Department Middle East specialist who was put in charge of the Iraq foreign ministry in early 2003. The bottom line is just about everything the neocons did was wrong or motivated by politics or money. The theft as you know is over $20 billion, which is colossal.
Bill Gates has been long euros for some time and he stated late last week that he is pulling further out of the dollar and investing further in euros. In fact, he is even short the dollar. He cited many of the same reasons we have, “It is a bit scary, and we’re in uncharted territory when the world’s reserve currency has so much debt.”
Worldwide Moody’s credit ratings saw 1.62 upgrades for every downgrade in the third quarter – an improvement from 1.53 in the second quarter and 1.44 in the first quarter. North America was 1.09; Europe, the Middle East and Africa 1.97; 4.50 in the Asia-Pacific region and 6.33 in Latin America. US credit has more issuers on review for downgrade or have negative outlooks. That is not good.
An historical reminder: Paul Wolfowitz, the deputy secretary of defense, was so eager to see the US launch a preemptive strike against Iraq in 2002 that he ordered the CIA to investigate the past works of Hans Blix, the chief UN weapons inspector who in February 2002, was asked to lead a team of UN weapons inspectors into Iraq to search for WMD.
This unusual move shows how far the Bush neocons were willing to go to invade Iraq. The manipulation and exaggeration of intelligence and the besmirching of Blix’s good name was in vane because intelligence found nothing and Wolfowitz hit the roof. Then the lies just multiplied from there to justify war.
When Porter Goss took over the CIA last year his job was to purge all of the good guys. Many left, but his tenure has been a terrible failure. All those undercover operatives with the clandestine services are unhappy and many have resigned or taken early retirement. Some have requested reassignment. The directorate’s second in command has quit. He told Senators he had lost confidence in Goss’s leadership. Senators are going to invite Goss to a hearing to explain why the CIA is bleeding talent in a time of war, and to answer charges that the agency is adrift.
Goss was stripped of his leadership role by his subservience to a new director of national intelligence. Then again, you can never be popular after having conducted a purge. You cannot run a spy agency with a continual political aversion to operational risk. He takes his orders from Cheney and Rumsfeld and that is not the way to run the agency. George Tenet attempted to appease the neocons and got the shaft in return.
Per our experience in counterintelligence we must admit that people who work for the agency are among the brightest, best educated in the country and they are independent and at times very strange. Most very bright people are strange. Tenet connected with the professionals because he worked at it. Some people have it and some don’t, and obviously Goss doesn’t have that connectibility. At 67 years old, Porter is tired and overwhelmed. This is not a job for a man approaching 70. Goss and all the neocons should leave their jibs because they have been a disaster for the country.
Tom Barrack, who is headlined as the world’s greatest real estate investor, is methodically selling off his US real estate holdings as the market starts its softening process. He says, “When amateurs are all over the field, someone has to get killed. They have more guts than brains.”
Barrack’s Colony Capital, one of the largest private equity firms devoted solely to real estate, has racked up returns of 21% annually since 1990, handling investors, chiefly pension funds and college endowments.
He buys classy, but neglected properties anywhere in the world where prices are low. Then, he pours in capital to fix them up and then resells them. Donald Trump says of Tom, he has an amazing vision of the future, an ability to see what is going to happen that no one else can match.
He sees signs of the tech bubble mentality in real estate. “Too much capital is chasing real estate with hedge funds, private equity groups and rich investors all bidding on the same properties.” They’ve driven prices to the point where the yields on high-quality properties are like the returns on bonds, around 5-6%, and that is too low. As we have said the slump will show up first in speculative hot spots like Miami and Las Vegas. He foresees a glut of condos and homes in these hot areas in the year’s ahead.
The prime contractor on a $1 billion technology contract to improve the nation’s transportation security system, Unisys Corp., over billed taxpayers for as much as 171,000 hours worth of labor and overtime by charging up to $131 an hour for employees who were paid less than half that amount. It just doesn’t end. Corporate America simply cannot restrain its criminal proclivities.
Max Boot, a senior fellow at the Council on Foreign Relations, which we’ve written about before, urged the creation of a mercenary army called the Freedom Legion in order to offset diminishing recruitment numbers to pursue permanent revolution and the neocon version of global democratic revolution. He wants to open recruitment to illegal aliens and foreigners so that if we had revolution in America these foreigners would think nothing of killing us, whereas the elitist know 80% of American troops would not shoot their fellow citizens. US citizenship would be offered as an inducement. There are currently 37,500 foreign nationals from over 200 countries currently serving in the armed forces.


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