Posted By stuartbramhall on October 15, 2013
WE’RE MOVING!
Owing to increasing technical difficulties with this platform, The Most Revolutionary Act is relocating to a mirror site at http://stuartjeannebramhall.com/
Click on http://stuartjeannebramhall.com/ to read my latest post “The Collapse Has Already Started.”
photo credit: Kurt Komoda via photopin cc
Posted By stuartbramhall on October 12, 2013
The Storm Clouds Gathering video below lays out a strong case that Wall Street is headed for another crash – either in December or January.
According to the filmmakers, the rise in stock prices in 2013 is really a bubble about to burst. The main cause of the bubble is the $85 billion in Quantitative Easing (QE3) the Federal Reserve has been injecting into the economy every month. This money doesn’t go to American businesses or consumers, but to banks. They, in turn, invest it in the stock market. Whenever there are more buyers than sellers, stock prices go up.
Current price indicators are virtually identical to past bubbles that have triggered crashes, as is the Schiller price to earning (P/E) ration. In a normal market, the rise in a stock’s price should reflect how well it’s performing. Once the Schiller P/E ratio passes a certain critical value, a “correction” (i.e. market crash) is inevitable.
The most ominous sign of an imminent crash is all the Wall Street insiders (the 1%) pulling their money out of stocks and putting it into real estate and other tangible assets.
There are too many variables to predict the exact month the crash will occur. However the video offers a number of scenarios that could potentially trigger the crash, including a default on the US debt, a war in Syria or Iran, or a meltdown in the $700 trillion derivatives market.
Derivatives are a sophisticated form of gambling in which bankers bet on the future price of a stock or commodity. The derivatives bubble was $500 trillion when the meltdown started in 2007. Because $700 trillion is more than ten times the size of the world economy, the banks exposed to derivatives (all of them) would fail without massive government bail-outs.
The only disappointment in the film is the shallow analysis of Quantitative Easing at the end. It seems to support a monetary system in which private banks are allowed to create money out of thin air, but not government. The problem with QE3 isn’t that the Fed is pumping new money into the economy. The problem is giving all $85 billion of it to banks. It should be used to help small businesses and ordinary families. See my last post An Australian Looks at the US Economy
Enjoy.
Posted By stuartbramhall on October 10, 2013
Australian economist Steve Keen (author of Debunking Economics) has an excellent 2009 article on his Debtwatch site explaining how Fractional Reserving Banking (FSB) supposedly works. The major premise of the article is that true FSB only exists in the minds of academic economists. Keen begins with a quote from Karl Marx (and a prominent photo) that was featured in a January 2009 article Investors Shortchanged in the Sydney Morning Herald:
“Talk about centralisation! The credit system, which has its focus in the so-called national banks and the big money-lenders and usurers surrounding them, constitutes enormous centralisation, and gives this class of parasites the fabulous power, not only to periodically despoil industrial capitalists, but also to interfere in actual production in a most dangerous manner— and this gang knows nothing about production and has nothing to do with it.” (Das Kapital, Volume 3, chapter 33).
Although Marx was totally off base in predicting the imminent downfall of capitalism, he sure got it right about banks.
In the academic model of Fractional Reserve Banking, a retail bank establishes reserves (with depositors’ money and funds borrowed from the Federal Reserve). They then create $90 in new money for every $10 they hold in reserve. Only it never works this way in real life. The Reserve Bank of Australia totally eliminated the reserve requirement in the 1990s.The Federal Reserve has no reserve requirement for business loans and the 10% reserve requirement for personal loans is full of loopholes.
Keen’s article goes on to present M0/M1 and M2 data showing that what academic economists are calling Fractional Reserve Banking is actually a Pure Credit Monetary System. In other words, private banks are totally free to issue as much money, in the form of new loans, as they choose. They also have total control of both the money created by the commercial system and the money created by government.
M0 (sometimes called M1) refers to the Base Money or fiat money created by the Federal Reserve. M2 refers to M0 plus new money created by banks as loans. The ratio of M2/M0 is called the “money multiplier” ratio.
What his graphs show is that credit money (M2) is created first and M0 or fiat money (the reserves to cover it) is created up to a year later. In a true FRB system, M0 or Base Money would increase first, and M2 would follow as banks issue new money based on their reserves. The other major problem is that combined public and private debt greatly exceeds M2. Under a true FRB system, total debt could never exceed the amount of fiat and bank money created.
Keen’s paper also includes an interesting prediction that the Federal Reserve’s quantitative easing (increasing M0 by electronically “printing” $85 billion in new fiat money every month) will be vastly insufficient to bring about economic recovery. He gives four reasons for this:
Keen predicts that quantitative easing will have little effect unless Federal Reserve Chairman Ben Bernanke pumps enough money into the economy to make a dent in the $42 trillion US debt. Deducting compound interest, he reckons $20 trillion would reduce it by about a quarter.
Ironically such a massive increase in government-issued Base Money (M0 ) would effectively replace our bank-controlled credit money system with a publicly controlled fiat money system. In other words it effectively restores the ability of the federal government to issue money, as Lincoln did (see The Role of Foreign Banks in US History).
Makes you wonder if this is Obama’s and Bernanke’s true agenda with all the electronic money they’re printing – to quietly nationalize America’s monetary system through the backdoor.
For more background on how private banks create the vast majority of US dollars (out of thin air), check out the free video The Secret of Oz:
Photo credits: youkaine via photopin cc and photo credit: wolfgangfoto via photopin cc
Posted By stuartbramhall on October 8, 2013
click on image to enlarge
Former US West CEO Joseph Nacchio was released from prison last week after completing a four year insider trading sentence. He still claims the NSA framed him on the insider trading charges – after he refused to participate in their illegal phone surveillance program in 2001. US West was the only major telecommunication program that refused to spy on its customers. According to the Wall Street Journal, Nacchio feels vindicated by Edward Snowden’s recent revelations about NSA spying on Americans’ phone and email communications.
Nacchio was convicted of selling US West stock based on inside information about the company’s deteriorating financial health. He denies this, claiming he believed US West’s lucrative contracts with the federal government would continue. Instead his refusal to cooperate with the NSA resulted in the wholesale cancellation of government contracts.
Nacchio had evidence supporting this claim. However the judge ruled it was classified and prevented his defense team from presenting it. The redacted NSA files were only made public after the former CEO was convicted and sentenced. However Harper’s and others have always supported Nacchio’s contention that he was prosecuted in retaliation for saying “no” to the NSA.
Whether or not Vlaccio is guilty of insider trading (all the legal arguments are summarized at Race to the Bottom), the most illuminating information in the redacted files is that the NSA was pressuring US West to spy on customers in February 2001. This was a good seven months before the 9-11 attacks, the supposed justification for curtailing Americans’ civil liberties.
Image credit: Indict Dick Cheney
Originally published at Veterans Today
Posted By stuartbramhall on October 7, 2013
Americans rarely give much thought to where their food comes from. They should. Rapidly expanding cities mean the US loses two acres of fertile farmland every two minutes. The dwindling number of US farmers – now at 1.5 million – is even more concerning. At present the average American farmer is over 60 – only 5% of them are under 45.
The US government has been desperately trying to recruit more formers since 1992, when they first introduced a special loan program for beginning farmers. Owing to poor uptake, the 2008 Farm Bill greatly expanded the loan program, as well as introducing educational assistance and special training programs, commodities payments, conservation payments and crop insurance subsidies to new farmers. These programs were expanded even further in 2010, when US Secretary of Agriculture Tom Vilsack announced his goal of recruiting 100,000 new farmers in five years.
Although the number of loans to beginning farmers increased from 9,000 in 2008 to more than 15,000 in 2012, there’s growing skepticism about other aspects of the program. Commodities and crop insurance subsidies clearly benefit large corporate players – factory farms and the private insurance companies – more than small farmers. Last week, GMO and pesticide manufacturer Monsanto bought into the crop insurance racket when they acquired ClimateCorp, a San Francisco based company that employs complex weather data to set prices for its crop insurance policies. At the same time speculative property development, which poses the most immediate threat to productive farmland, remains unaddressed.
According to Reuters, the organic and healthy food movements have also been instrumental in inspiring urban youth in returning to the land, where they are supported by a number of national and state nonprofit organizations.
Greenhorns, a national membership organization of 6,000+, is one of the largest and most active. Founded in 2007, the group works to promote, recruit and support young US farmers by putting on events and workshops, networking, resource sharing, and the production of traditional and new media: radio, documentary film, blog, a book of essays, guidebooks, web-based tools. Their primary goals are to “retrofit” the corporate food system by building a thriving agricultural economy, based on solid business skills and sustainable farm practices.
Their website offers a phenomenal range of resources, with links to
I was especially intrigued by the Greenhorns new documentary and their 2013 New Farmers Almanac. The latter is a new twist on the classic Old Farmers Almanac. Designed to appeal to healthy food advocates as well as farmers of all ages, it presents a collection of essays about adjusting to large scale urbanization and the mega population boom, as well as reclaiming a landscape dominated by monoculture, soil depletion. Available in paperback for $20 from AK Press
Here’s the trailer to the documentary, which can be purchased for $10 from their website:
*In Community Supported Agriculture schemes (CSAs) consumers subsidize a local farm by purchasing a subscription to weekly deliveries of fresh vegetables and/or fruit.
Posted By stuartbramhall on October 5, 2013
Nothing like a nice government shutdown to remind us that the federal government is hopelessly dysfunctional. Congress and the White House are so focused on the needs of their corporate donors that most of the laws they pass hurt ordinary Americans rather than helping them. Fortunately a growing number of local groups have discovered that the most meaningful form of political change happens outside of official political channels. Together with family, friends, and neighbors, they’re opting out of the “corporate” lifestyle and inventing more meaningful grassroots models for meeting human needs.
Annie Leonard, who produced the world changing video They Story of Stuff in 2008, has just released a sequel The Story of Solutions. Like her first film, it challenges a society built on ever increasing economic growth and accumulating more stuff. However the focus of The Story of Solutions is more on community organizing to move our economy in a more sustainable and just direction. To quote from the film promo:
“In the current ‘Game of More’, we’re told to cheer a growing economy – more roads, more malls, more Stuff! – even though our health indicators are worsening, income inequality is growing and polar icecaps are melting. But what if we changed the point of the game? What if the goal of our economy wasn’t more, but better – better health, better jobs and a better chance to survive on the planet?”
The nine-minute video includes inspiring real-world examples of ways in which communities are mobilizing for change – through programs as simple as “tool-sharing” libraries. There’s absolutely no reason why every American needs to own their own lawnmower, power drill, and chainsaw.
Here’s the original The Story of Stuff for people who missed it when it first came out.
Posted By stuartbramhall on October 3, 2013
Books to Prisoners is a Seattle-based, all-volunteer non-profit organization founded in 1973 under the sponsorship of Left Bank Books. BTP ships books to prisoners – at their request. Prisoners send them 1,200 – 1,300 book requests per month. BTP believes that books are important tools for learning and self-improvement. Moreover, as Brazilian educator and activist Paulo Freire taught, literacy and reading opens peoples’ minds to new ideas and possibilities.
In the US, which spends vastly more on the prison industrial complex than schools, prison is the primary anti-poverty program. American prisons house nearly 25% of the world’s prisoners – more than 2.2 million. The vast majority are from disadvantaged communities and are either African American or Hispanic. Most have been incarcerated for victimless drug crimes. Prison rehabilitation is a myth, especially as prison privatization and state cutbacks have greatly curtailed prisoners’ access educational and training opportunities.
BTP prefers monetary donations. However they do welcome books from the following categories provided they are in paperback (most prisons prohibit hard back books) – and preferably accompanied with a $35-70 donation to cover the cost of shipping them to prisons.
Books (and donations) can be mailed to:
People can also donate via the BTP website: http://www.bookstoprisoners.net/donate/
The following video illustrates the profound effect this forty-year program has had on prisoners’ lives:
photo credit: » Zitona « via photopin cc
Originally posted at Veterans Today
Posted By stuartbramhall on October 1, 2013
photo credit: Gates Foundation via photopin cc
Posted By stuartbramhall on September 29, 2013
Posted By stuartbramhall on September 27, 2013
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