America’s Crony Capitalism

Last November 17 commodity broker Ann Barnhardt announced that Barnhardt Capital Management would cease operations. “I could no longer tell my clients that their monies and positions were safe in the future and options markets – because they are not,” she explained. “The entire system has been utterly destroyed by the MF Global collapse.”

According to Barnhardt, times are changing. “Whenever a firm failure happened, the customer funds were intact and the exchanges would step in to backstop everything and keep customers 100 percent liquid….” But now the system has broken down. As Barnhardt noted, “A firm, led by a crony of the Obama regime, stole all of the non-margined cash held by customers of his firm.”

There is a fascinating interview that Jim Puplava did with Barnhardt last November where she offered a perspective on where our country is headed and why. What she says is shocking and will sound improbable to many. She says, “We are now living in a lawless, Marxist communist [country]. This is no longer a nation of laws. This is now transformed into a nation of men.”

Barnhardt is using precise language. She is not exaggerating, whatever we may think. An enormous amount of money was stolen in the MF Global collapse. A huge transfer of wealth took place. “There is no rule of law,” Barnhardt told Puplava. “The rule of law no longer exists. There is no longer justice in this country; and no nation, no culture, no society can survive if there isn’t a foundation of justice. That is why we are teetering on the precipice of collapse and I foresee civil war coming in the next several years.”

Barnhardt sees corruption at the top. She also sees a political forces at work – and a political ideology that is linked to the welfare state and the massive indebtedness we see around us today. According to Barnhardt, “Europe is done. Europe is mathematically impossible, it cannot be saved…. You want to make a start … at trying to bail out Europe? We are talking about $25 trillion just to start.”

The end is indeed near. The debt at home and abroad has piled too high for too long. As of this writing, sovereign debt is growing faster than the global economy. As Barnhardt explained, “These people have so leveraged themselves … giving their brain-dead citizenry free handouts and entitlements that it is now mathematically impossible to save the paradigm. It’s not a matter of ‘if’ the global financial system is going to collapse; oh, it’s going to collapse. It’s just a matter of when.”

Moral rot pervades modern society. “We now know that the government is absolutely stuffed to the gills almost exclusively with this same type of moral degenerate culture,” noted Barnhardt. “These people that are in the government – that are … not just in the Congress and the Executive Branch, but also in the bureaucracy – they are in it for themselves. They are in it for the money. “

The honest businessman finds himself at the mercy of dishonest officials who are working with dishonest businessmen. “Those of us who have been in the business have known intuitively … that there was front-running going on by politicians. A great example of this is someone like Harry Reid,” said Barnhardt. “Harry Reid, when he entered Congress, had a low six-figure net worth. He now has an eight figure net worth, and he has never done anything except be a United States Senator…. How does that happen? How does a man with a hundred and seventy thousand dollar a year salaried position go from having a six figure net worth to an eight figure net worth?”

A system based on trust cannot endure the collapse of honesty and integrity. Such a system is headed for ruin or worse. “It’s obvious what’s been going on,” Barnhardt continued. “You have to start acknowledging these people for what they are, and that is moral degenerates who are basically sociopaths and psychopaths…. The only thing they care about is themselves. They will do anything. They will steal, they will lie, they will cheat….”

Bad behavior is contagious. In fact, it has spread like a plague throughout the financial system. It seems that no law can stop it. No religion can reach it. According to Barnhardt: “You have to stop thinking that these people are just misguided, or that there is some sort of a difference of opinion on economic theory. These people are nefariously trying to destroy everything in this country. It’s called the Cloward-Piven strategy. Go in and destroy and collapse the entire economy … and then rebuild a new … Marxist-socialist-fascist state out of the burning rubble of this destruction. This is intentional, this is nefarious. This is not a function of incompetence.”

According to Wikepedia, “The Cloward-Piven strategy is a political strategy outlined in 1966 by American sociologists and political activists Richard Cloward and Frances Fox Piven that called for overloading the U.S. public welfare system in order to precipitate a crisis that would lead to … a national system of ‘guaranteed annual income and thus an end to poverty.’” Of course, the aforesaid system of guaranteed income is simply a euphemism for the dictatorship of the proletariat.

She is right, of course. But few are ready for the truth. Everyone sees a system that appears to be working. And most people, seeing only what they want to see, will ignore the danger. As Christopher Lasch wrote many years ago, “If the collapse of internal [moral] restraints were confined to the criminal classes, it might be possible, by means of a combination of incentives and stricter enforcement of the laws, to restore a sense of obligation. But the culture of shamelessness is not confined to the underclass.” [Revolt of the Elites, p. 214]

Full article: America’s Crony Capitalism (JR Nyquist)

Europe’s debtors must pawn their gold for Eurobond Redemption

The consolidation of power continues flowing back towards Germany as sovereign EU nations become indebted into slavery through economic extortion and subjugation. At this point, it’s hard not to say the Fourth Reich and the Holy Roman Empire are returning as even the German-Vatican connection is growing closer once again. Also see a previous post “Europe to Seize Greece’s Gold” for further information.

The German scheme — known as the European Redemption Pact — offers a form of “Eurobonds Lite” that can be squared with the German constitution and breaks the political logjam. It is a highly creative way out of the debt crisis, but is not a soft option for Italy, Spain, Portugal, and other states in trouble

In effect, Germany would share its credit card to slash debt costs for Italy, Spain and others. Yet it is the exact opposition of fiscal union. While eurobonds are a federalising catalyst, the fund would be temporary and self-extinguishing. “The fund is a return to the discipline of Maastricht with sovereign control over budgets,” said Dr Benjamin Weigert, the Council of Experts’s general-secretary.

The ingenious design gets around the German constitutional court, which ruled in September that the budgetary powers of the Bundestag cannot be alienated to any EU body under the Basic Law — the founding text of Germany’s vibrant post-War democracy.

Germany would have a lockhold over the fund, able to enforce discipline. Each state would have to pledge 20pc of their debt as collateral. “The assets could be taken from the country’s currency and gold reserves. The collateral nominated would only be used in the event that a country does not meet its payment obligations,” said the proposal.

Full article: Europe’s debtors must pawn their gold for Eurobond Redemption (The Telegraph)

On the Relevance of Democracy

What seems to be an economic crisis is actually a premeditated assault via economic warfare in attempt to subjugate sovereign nations — and Greece is only the first.

When you hear Germany, Europe’s leader, speaking about stabilizing Greece, it means the desired result is capitulation and relinquishing of sovereignty in exchange to stay afloat just a little while longer — all for the United States of Europe project that was destined to fail from the beginning. Yet, they continue to push forward, piece by piece. What’s more, it was conceived to fail and it was known it would fail. The failure was only the tool for reshaping the continent to German will. In the case of Greece, the German government is well aware of the difficulty of convincing Greeks to willingly relinquish their national sovereignty. Therefore, the only way to achieve unification, without war, is through stealth. The people must not know that sovereignty is being and has been surrendered until it is gone.

Greece is only the beginning and the public is being prepped for possible military intervention should a the (planned outcome) crisis spin further out of control (hint, hint). We’re still yet to see what will become of the other largest economies in Europe such as Spain and Italy who see Greece’s fate as a benchmark. Furthermore, perhaps we may not see the same defiance with these since they are more compliant and politically allied. France has been known to toe the German line for quite some time now.

The same desired outcome with a twist, and a different game plan is in play.

As one article puts it:

Europe’s leaders are on the cusp of a unification project that will turn the disparate nations of Europe into a true superpower. As Europe’s debt woes increase, so too will the desire for further integration—at any cost. With each crisis, Germany’s position is strengthened. If unification is to proceed, it will be on German terms.

Those who are tuned out to reality or see the economic crisis for what it is only at face value on the evening news, this may seem highly unlikely, unfounded, ridiculous or even appauling.

For those who are tuned in: Make no mistake. Under a German-dominated EU superstate, the Fourth Reich is here.

ATHENS/BERLIN (Own report) – In the run-up to new elections in Greece, the German elite is discussing various scenarios involving the use of force to ensure control over Athens, including the establishment of a protectorate or the deployment of “protection forces” in that southern European country. The German austerity dictate, pushing Greece into destitution, is provoking growing popular resistance, which, apparently, can no longer be suppressed with democratic means. Berlin has failed in its efforts to force Athens into subordination by threatening to withdraw the Euro, as much as with its demand that Greece combines its parliamentary elections with a referendum on the question of remaining in the Euro zone. Berlin categorically rejects the option of retracting the austerity dictate and replacing it with stimulus programs, as is being demanded by leading economists world wide, even though the exclusion of Greece form the Euro zone threatens to push the currency, itself, into an abyss.

No Right to Respect

In addition, Berlin has obviously applied pressure on Athens to combine a referendum on remaining in the Euro zone with the elections. This tactic is aimed at weakening the opponents of austerity. According to reports, German Finance Minster Schäuble made this proposal already last Monday to his Greek counterpart at the meeting of the Euro finance ministers.[2] This proposal is obviously supported by the Chairman of the CDU/CSU parliamentary group in the Bundestag, Volker Kauder (“Now German will be spoken in Europe” [3]). A Greek government spokesman confirmed that Chancellor Angela Merkel urged Greek President Karolos Papoulias last Friday to implement the German plan for a Greek referendum, whereas in November 2011, Berlin briskly rebuffed the Prime Minister at the time, Giorgos Papandreou, when he publicly announced his proposal to hold a referendum. This led to his demise. Berlin’s open interference is met with outrage in Athens. The Greek population has a “right to respect,” the chairperson of the conservative Nea Dimokratia, Antonis Samaras, was quoted as saying. And the chairman of the opposition party Syriza, Alexis Tsipras, declared that Berlin is acting as if Greece “is a protectorate.”[4]

Protectorate

The sectors of the German elite, which refuse to consider this change of course proposed by Krugman and numerous other experts outside Germany,[7] are now publicly debating scenarios involving the use of force. In a newspaper interview early this month, the director of the prominent Hamburg Institute of International Economics, Thomas Straubhaar, called for establishing a protectorate in Greece – “regardless of the outcome of the elections.” The country is a “failed state,” he says, which is unable to raise itself “to a new start” under “its own steam.”[8] Athens needs “help in establishing viable state structures.” It, therefore, must be transformed into “a European protectorate.” “The EU must do it,” affirms Straubhaar. The EU “would have to help Greece modernize its institutions at every level, particularly with administrative staff, tax experts, and tax inspectors.” However, refounding Greece would demand “intuition” to “overcome national pride, conceit, and the resistance of interest groups.” This is referring to a sovereign democracy, a German ally in the EU and NATO.

Protection Forces

Last week, a leading German daily discussed the issue of dispatching troops to Greece. Should the country go bankrupt, it would then, as a “‘failing state,’ (…) be less in a position” to shore up its borders against migrants, writes the Frankfurter Allgemeine Zeitung. Just recently, the EU Commission announced that it finds itself forced to prolong the mission of its EU border troops at the Greek/Turkish borders. If Athens “should no longer be able to pay its officials, or can pay only in Drachmas,” the situation risks “chaotic.”[11] The country could possibly “be rocked by rebellions.” “Help for Greece would then no longer be on credit, but be transformed into a sort of humanitarian emergency aid,” prophesied the journal in its front-page lead editorial. “Hopefully, an international protection force, such as is stationed in the teetering countries further to the north, will not become an option.”[12]

Full article: On the Relevance of Democracy (German Foreign Policy)

This is Germany’s Moment!

It appears the current phase of Europe’s debt crisis is entering its last hour. We’ll know soon, but it’s possible the weekend of May 5, 2012, will be remembered as a transformative moment in the history of Europe.

Once again, the nation at the center of it all is Germany.

Finally, there’s the run-off presidential election in France, which could have enormous impact on Germany and Europe. From the moment the debt crisis began in 2008, the responsibility of fixing it has rested primarily on the German-French axis. Truth be told, President Sarkozy’s main responsibility has been to embrace the solutions coming from Berlin, giving them added legitimacy in the eyes of Europe and the rest of the world.

If Socialist candidate Francois Hollande is elected, Germany loses its French toady.

That’s not all. When it comes to solving Europe’s debt woes, Hollande’s view is the antithesis of that of Angela Merkel and German public opinion. He’s already stated that he won’t support the fiscal pact as it currently exists. When it comes to Europe’s finances, he said last week, “It’s not for Germany to decide for the rest of Europe.” He also believes that instead of austerity, the solution to Europe’s debt woes is printing and spending more money. “So many people in Europe are waiting for our victory,” he said recently, “I don’t want a Europe of austerity, where nations are forced on their knees.”

Read between the lines of that statement. This man isn’t merely campaigning for leadership of France, he’s making a play for leadership of Europe. In another recent address, Hollande told supporters that “the people of Europe expect that we, the people of France, will provide Europe with another perspective, another direction, another orientation.”

They say Hollande lacks personality and charisma. Well, he makes up for it in audacity. He sincerely believes the rest of Europe wants him elected so France can replace Germany at the helm of Europe!

That’s never going to happen. France lacks both the financial health and political muscle to replace Germany as the arbiter of this crisis. Nevertheless, France’s dissension under Hollande could throw Europe into financial and political turmoil. Der Spiegel reported recently that “for France’s neighbors and the fight against the sovereign debt crisis in Europe,” Hollande’s election “will set everything back to square one.”

As you can see, Europe’s financial crisis isn’t even close to being over—though it is likely entering a new, more exciting, more dramatic, more sobering chapter!

It’s possible, likely even, that the convergence of these events—the widespread resistance to German-imposed austerity, the renaissance of nationalism, Spain’s imminent default, the collapse of the Dutch government, and the inconveniently timed national elections in Greece and France—will produce a moment of historic importance. As this unfolds, don’t take your eyes off the nation at the center of it all.

As Ambrose Evans-Pritchard wrote, “The epicenter of Europe’s political crisis may soon be Germany itself.”

We must watch for Germany’s response. It will have a colossal impact on Europe, and on the rest of the world.

Full article: This is Germany’s Moment! (The Trumpet)

There Will be Contagion

Great article, great insight:

But let’s make no mistake. The sovereign debt crisis is not over. Not in Europe, not in Japan, and not in the US. It is in a lull period. And don’t give me that old shibboleth, “The market is telling us that the crisis is over.” The market knows a lot less than many pundits believe. What did the market know in mid-2007? Not very much, although the warning signs were clear, at least to some of us.

Full article: There Will be Contagion (John Mauldin) (Note: Article is a .pdf file. Download link is below title.)

Ireland To Hold Referendum On EU Treaty

Ireland is to hold a referendum on whether to accept the European fiscal treaty which tightens controls on member states’ budgetary decisions.

Taoiseach Enda Kenny said he was confident the public will vote in favour of ratifying the contentious compact.

“I believe it is in Ireland’s national interest that this treaty be approved,” said Mr Kenny.

The Taoiseach, who announced plans for the referendum in the Dail, said that adopting the fiscal compact would be vital for Ireland’s economic recovery and job creation.

A decision to hold a referendum was taken on advice from Attorney General Maire Whelan.

The treaty, agreed by 25 of the 27 European Union states after Britain and the Czech Republic refused support, must be ratified by January 2013.

It is designed to prevent a repeat of the Greek debt crisis and protect against the potential collapse of the euro currency.

Full article: Ireland To Hold Referendum On EU Treaty (Yahoo!)

America Is Looking a Lot Like Ancient Rome — or Is It Modern Greece?

In 1935, one U.S. dollar would buy you 1/20th of an ounce of gold. By 1968, it was down to 1/35th of an ounce of gold. Today, one dollar will buy you only 1/1,750th of an ounce. The same thing happened against silver. In 1968, one dollar would buy an ounce of the silver metal. Today it will only buy you a mere 1/32 of an ounce.

Talk about debasement.

And the dollar hasn’t plunged just against precious metals. Against copper, nickel and zinc—the metals found in pennies and nickels—it is in free fall too. In fact, the dollar has plummeted against orange juice, whiskey, beans, bullets, pork bellies, single family houses, automobiles, coal, oil, good suits, healthcare, tuition, labor costs—and virtually every measurable commodity. If you can name it, it probably cost more today than it did 30, 10, or five years ago—probably more than it cost last year.

The mint reports that if it replaced the copper-coated zinc penny (it took the copper out of the penny in 1982 because it was too expensive) with a steel one, it would still not be profitable. What’s cheaper than steel? Tin? Nope a penny’s weight of tin would cost more than a nickel. A penny’s weight of aluminum would cost 2 cents. Lead is little cheaper. See the problem?

How about plastic? Anyone for a plastic penny? Clay? Asbestos?

Calls to just get rid of the penny altogether are growing louder. But that will only hide the danger to the dollar for a little longer.

And don’t be fooled. The dollar is in grave danger.

Full article: America Is Looking a Lot Like Ancient Rome — or Is It Modern Greece? (The Trumpet)

Moody’s Cuts Europe Sovereigns Including Italy, Spain

Moody’s Investors Service cut the debt ratings of six European countries including Italy, Spain and Portugal and revised its outlook on the U.K.’s and France’s top Aaa ratings to “negative,” citing Europe’s debt crisis.

Spain was downgraded to A3 from A1 with a negative outlook, Italy was downgraded to A3 from A2 with a negative outlook and Portugal was downgraded to Ba3 from Ba2 with a negative outlook, Moody’s said. It also reduced the ratings of Slovakia, Slovenia and Malta.

Full article: Moody’s Cuts Europe Sovereigns Including Italy, Spain (Bloomberg)

Merkel Campaigns for Sarkozy Presidential Election

The campaign is driving the two most powerful nations in mainland Europe closer together. EU President Herman Van Rompuy said the debt crisis is now causing a “Europeanization of national political life.”

The Associated Press writes: “The cross-border campaigning reflects a more concerted effort toward the erosion of national sovereignty that leaders like Merkel see as the way for debt-laden Europe to survive in a world increasingly dominated by Asian economic powers such as China.”

Mr. Sarkozy’s competitor, Socialist François Hollande, would oppose everything that Chancellor Merkel is trying to do in Europe—which is pushing her to forcefully support Sarkozy.

Meanwhile, if Sarkozy wins the election, he will be in Merkel’s debt. He is already pushing France to follow Germany’s lead. This support in the election makes France even more subordinate to Germany.

The German-led EU has overturned governments in Greece and Italy. Now Chancellor Merkel is trying to keep a friendly one in power in France. Germany’s dominance of Europe is made clearer every day.

Full article: Merkel Campaigns for Sarkozy Presidential Election (The Trumpet)

China Considers Offering Aid in Europe’s Debt Crisis

HONG KONG — Prime Minister Wen Jiabao said Thursday that China was considering whether to work with the International Monetary Fund to play a greater role in financing Europe’s efforts to end a sovereign debt crisis, but he left it unclear whether China was willing to drop conditions that would make its help unappealing for European countries.

Mr. Wen, speaking at a press conference in Beijing after a meeting with Chancellor Angela Merkel of Germany on the first day of her three-day visit to China, said that officials were studying whether China should be “involving itself more” in Europe’s debt troubles through investments in the European Financial Stability Facility and the European Stability Mechanism. This could be done through the I.M.F., he said.

One idea under consideration by China in recent months is whether it could lend money to the I.M.F., which would then lend it to Europe. This would transfer the risk of a European default to the I.M.F.

Russia embraced this approach in December, but was willing to lend only $20 billion. China had $3.18 trillion in foreign exchange reserves at the end of December, dwarfing the reserves of every other country and potentially giving it the financial power to make a much bigger contribution.

Mrs. Merkel is the first of several European leaders scheduled to visit China this month, the latest in a series of signs that China’s huge foreign exchange reserves have begun to give it financial influence to rival Washington’s.

Full article: China Considers Offering Aid in Europe’s Debt Crisis (New York Times)

Germans float direct EU control over Greek budget

Being that Germany is the EU, look for the major influences of future change and reform to come from Berlin — as well as increased power in Berlin’s favor.

The unprecedented and sweeping powers for creditors would indeed deal a huge blow to Greece’s sovereignty, but they could help mobilize more support for the government in Athens from its European partners.

Several German lawmakers have repeatedly said that giving more money to Greece is unthinkable without stricter enforcement and control of the conditions attached to the rescue packages.

Greece is currently locked in a twin effort, seeking to secure a crucial debt relief deal with private investors while also tackling the pressing demands from its European partners and the IMF for more austerity measures and deeper reforms.

Failure on either front would force the country to default on its debt in less than two months, pouring new fuel on the fires of Europe’s debt crisis.

Continue reading article: Germans float direct EU control over Greek budget (AP)