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Jeff Nielson is from Canada and is a writer/editor for Bullion Bulls Canada (http://www.bullionbullscanada.com/#content). He has a personal background in law and economics. Bullion Bulls Canada provides general macro-economic and political commentary, since the precious metals markets are among... More
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  • Destruction Of Spain’s Economy Duplicates Greece

    More than two years ago I began warning readers of the most heinous acts of fraud ever perpetrated by the Western banking crime syndicate, which I dubbed "economic terrorism". These swindles involved nothing less than the destruction of entire European economies, solely so that the banksters could profit on approximately $100 trillion in bets they had placed on the debts of these economies.

    The mechanics of this economic rape have been explained many times in the past. First of all the bankers duped governments and institutions all over the Western world into placing trillions of dollars (and/or euros) in bets that interest rates were about to soar higher - just before they crashed interest rates to the lowest levels in history. This swindle is known as "interest rate swaps".

    The second (and even more destructive) form of fraud perpetrated against these governments didn't even require their participation - merely their naïve acquiescence. The bankers began placing huge bets (totaling at least $60 trillion) that these nations would default, and then had the audacity to call these bets "insurance" (credit default swaps). Note that such "insurance" had been banned in the U.S. for more than half a century - based upon anti-gambling statutes.

    Here is the question which these banksters would never answer: how does a third party placing bets on whether someone's home would burn down provide any "insurance" to the owner of the home? The answer of course is that it doesn't. What it did do, however, was to create a $60 trillion motive for "arson".

    This is precisely what we have we have seen. After the banksters (primarily based in Wall Street) got assorted chumps to take the wrong side of this $60 trillion, unregulated mountain of bets - betting that these Euro governments would not default - they then began to systematically burn-down the economies of Europe one by one.

    I have explained this process several times in the past already, so those readers new to this will have to refer to my previous work. In a nutshell, the Wall Street terrorists can manipulate the interest rates of these nations to (literally) any number they choose via the fraudulent manipulation of the credit default swaps market. I warned readers that this made Greek default inevitable, since if interest rates can be manipulated to any level then any nation can be bankrupted on its debt.

    This is exactly what took place with the destruction of Greece's economy. Each time that Greece's government served the bankers by announcing a new round of "austerity", the terrorists would immediately drive-up the interest rates on Greece's debt so much higher that every dollar of budget-cutting was consumed in higher interest payments…plus a little bit more.

    The result was that instead of austerity improving the solvency of Greece's economy, the Wall Street terrorists always ensured that its economy was worse off after each new round of budget cuts - immediately creating even more pressure for even more austerity. It was nothing but a totally masochistic vicious circle. At one point the banksters had manipulated Greek interest rates more than 50 times higher than those of the U.S. - despite the fact that (as I have explained previously) the U.S. economy is even more fundamentally insolvent than that of Greece.

    Now the terrorists have targeted Spain.

    What we see taking place in Spain today is an exact, carbon-copy of what we saw in Greece. On the one hand, we have a traitor-government willingly imposing round after round of Friedman Austerity on its own people - despite the utter futility of such sadistic budget-cutting. On the other hand we have the banking crime syndicate (with the gleeful assistance of Big Media) relentlessly driving interest rates on Spain's debt ever higher, clawing back every penny of that austerity in interest payments to the Bond Parasites.

    Said Spain's Prime Minister, Mariano Rajoy:

    "Spain is facing an economic situation of extreme difficulty, I repeat of extreme difficulty, and anyone who doesn't understand that is fooling themselves…the alternative is infinitely worse."

    Congratulations Chicken Little! Rajoy succeeded in convincing his people that the sky is falling. Unfortunately, what he forgot to tell them was that the budget-cuts he's imposing have absolutely zero chance of improving things for his own people, while only engorging the Bond Parasites. Already Spain's government is budgeting €29 billion this year for interest payments alone, roughly 30% more than one year ago - while imposing savage budget-cuts on his own people.

    At the same time, Rajoy then increased upward pressure on the country's budget deficit by announcing "amnesty" for the nation's tax-cheats. Milton Friedman must be smiling from Hell. The wealthy get the "carrot" in Spanish austerity, while the Little People get only the "stick" - exactly as occurred in Greece. Even worse, having granted amnesty to tax-cheats once, this creates massive incentive/reward for future tax evasion - guaranteeing that government tax revenues will plummet lower, and the deficit will soar higher.

    As for Rajoy's threat/warning to his own people that "the alternative is infinitely worse", Spain's official (i.e. phony) unemployment rate has already reached 24%, even higher than in Greece and the highest in Europe - while he rewards tax-cheats and whacks his own people with more than €27 billion in new budget-cuts. I would suggest that nothing could be infinitely worse than that.

    Meanwhile (exactly as occurred in Greece), immediately after this new "austerity" is announced, Bloomberg and the Wall Street terrorists are busily at work manipulating Spain's interest rates much, much higher - their reward for the budget cuts just announced by their amigo, Rajoy.

    Here is Bloomberg's salvo just for today:

    Spanish borrowing costs have been going up since Rajoy announced on March 2 that his government wouldn't comply with the deficit target the previous administration had set with the European Union…The country hasn't met the EU's 3 percent [of GDP] deficit ceiling since 2007, and the government forecasts debt to reach 79.8 percent of GDP, the highest in more than three decades.

    What the propagandists of Bloomberg fail to include in their "analysis" (for context) is the fact that the U.S. is currently running budget deficits equal to roughly 10% of GDP. And its $14+ trillion national debt is already 100% of GDP. Yet we have Bloomberg explaining to its readers "why" Spain's interest rates should continue going higher - even though they are already several multiples of U.S. interest rates.

    Meanwhile, Bloomberg (and the bankers themselves) considers it totally appropriate for interest rates on U.S. debt to be at the lowest levels in history, despite the U.S. having the largest deficits and debts in the history of the world (even without including the $100+ trillion in "unfunded liabilities", which it excludes from any/all official calculations).

    Obviously when the biggest sovereign deadbeat in the history of the world enjoys the lowest interest rates on its own debt in history (see "Maximum Fraud in U.S. Treasuries Market"), while lesser debtors see their own interest rates (and interest payments) ratcheted-up inexorably higher this is empirical proof of the fraudulent manipulation of our debt-markets - wholly deserving of the label "economic terrorism".

    If it isn't bad enough already that individual European governments are willingly facilitating the economic rape of their own nations, we see/hear increasing talk of these traitor-governments creating a "Euro bond": one bond for all of Europe, and thus one debt market for all of Europe. Should the bankers be able to persuade (and/or blackmail) their political lackeys into embarking upon this act of collective, economic suicide; the Wall Street terrorists would then be able to do simultaneously (to all of Europe) what they currently have to perpetrate against these nations one at a time.

    While obviously it is primarily the peoples of Europe who should be demanding the immediate, unilateral repudiation of all credit default swap contracts relating to their own markets, we see absolutely no indications of awareness among their own populations about what is really taking place. Consequently, people in North America should also be very, very concerned - and actively lobbying to remove the political stooges who permit such crimes-against-humanity.

    For the question we should all be asking ourselves is this: once the Wall Street terrorists have finished laying waste to the economies of their friends in Europe, whose debt markets do you think they are going to destroy next?

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Apr 20 11:56 AM | Link | Comment!
  • The $15 TRILLION Money-Laundering Mystery

    Where did it come from? Where did it go? These are the two principal questions being framed today, after Lord James of Blackheath (a member of the UK House of Lords) unveiled documentation (and accusations) concerning a mounting of illegitimate cash: $15 trillion USD.

    At the moment, only Lord James is asking these questions. However, if he gets his way there will be an official inquiry into this massive, money-laundering operation. Already, Lord James possesses documents with the signatures of people like Alan Greenspan and Timothy Geithner on them, as well as massive transfers of funds to virtually every mega-bank in the U.S. and UK.

    While Lord James (himself a former banker) is holding the "paper trail" for all of this dirty money, he himself has no firm ideas about either the source of the money nor the intent of all of these massive transfers (all in the $100's of billions) to U.S. and UK banks. Perhaps I can help him out?

    Regular readers will be familiar with some of my own speculation into U.S. money-laundering (and counterfeiting of its own currency). Of interest, my own theorizing was based on a series of logical deductions which implied that some massive money-laundering operation (of counterfeit currency) must be taking place in the dying U.S. economy. And now we have a detailed paper-trail on the largest (known) money-laundering operation in history.

    To refresh the memory of regular readers and to inform new readers, back on January 3rd I published a commentary titled "Maximum Fraud in U.S. Treasuries Market". In that commentary, I outlined a series of simple-yet-obvious deductions pointing out the following facts:

    1) There are (virtually) no visible buyers for U.S. Treasuries on the planet (at any price).

    2) Even if there were interested buyers, there are no sources of capital available to mop-up all the $trillions in supply being dumped onto the market each year.

    3) Even if there actually were interested buyers, and even if they could scrounge the $trillions to buy this worthless paper, it is utterly absurd to suggest that these buyers would pay (by far) the highest prices in history for this paper at a time of maximum supply. It defies every basic principle of supply and demand.

    4) Taking this scenario from "absurd" to outright insanity, the U.S. economy has never been less solvent in its entire history. This directly implies that U.S. Treasuries should be fetching the lowest prices in history - not the highest - just like the worthless bonds being flogged by Europe's deadbeat-debtors.

    In other words, by process of simple deduction it was totally obvious that a gigantic, money-laundering operation was being conducted, with the primary goal being to prop-up the totally fraudulent U.S. Treasuries market. All that was missing was a paper-trail to prove this fraud, and now Lord James of Blackheath has been kind enough to provide this.

    Undoubtedly many readers will be skeptical of this, assuming that there would be no need to get into such a cloak-and-dagger (and blatantly illegal) process to pretend that worthless U.S. Treasuries still have value. Indeed supposedly these bonds have more "value" than at any time in history - despite the issuer of those IOU's being hopelessly insolvent, and merely delaying its own bankruptcy.

    In fact there is a very powerful reason why this fraud had to be conducted in the same, criminal manner in which the Wall Street crime syndicate launders countless $100's of billions of dirty money (mostly CIA drug cartel money) every year. The only way in which the Treasuries market could be propped-up in this illegal manner was by counterfeiting the banker-paper used to buy those bonds.

    In turn, there are two absolutely compelling reasons why the banksters have been forced to resort to blatant counterfeiting in attempting to prevent their entire paper empire from imploding into nothing. First of all, every fiat-dollar (legitimately) brought into existence is created via inventing new debt. To conjure (another) $15 trillion legally would have required piling $15 trillion more in debts onto the insolvent balance sheets of Western governments. In fact it would only require a small portion of that amount to cause all of these debt-dominoes to immediately topple.

    However, that is not the only aspect of utter terror which now grips these felonious financiers. The specter of hyperinflation hovers over these Vampires, a second but even more powerful force which can reduce all of this worthless fiat-paper to its real value (zero) in a matter of months/weeks/days.

    As I explained in a separate commentary, it is a tautology of both logic and economics that any good which can be produced at zero cost and in infinite quantities (like the bankers' paper currencies) is worthless. The logic is irrefutable. If such a good was not worthless, then infinite quantities of that good would/could be created (at zero cost) and then exchanged for any/every item of value on the planet. It would be nothing less than an act of total theft. Indeed, this precisely describes the entire bankster scam known as "fiat currencies".

    Print up ever increasing quantities of their paper, at a lower and lower cost (now zero in the U.S. and Japan), and exchange all of that worthless paper for any/every item of value you can steal. With U.S. dollars now permanently being created at zero cost, the only factor preventing the U.S. dollar from instantly plummeting to zero is that the apathetic dolts in charge of our markets do not yet perceive that U.S. dollars are being created in (effectively) infinite quantities. However, pile another $15 trillion of this worthless paper onto the global market and that perception could change instantly.

    I understand that for the average reader the mind simply rebels at the thought of our governments and (supposedly) respectable leaders of business demonstrating themselves to be no different (at all) from a Mafia crime family. So let me once again summarize these parameters altogether:

    a) There are no buyers for the $trillions of U.S. Treasuries (i.e. no one wants this paper), and especially not at the highest prices in history.

    b) There are no sources of (legitimate) capital to finance the purchases of these $trillions.

    c) The U.S. government is so close to outright financial collapse that it cannot afford to pay any interest on its massive debts. An increase of U.S. interest rates by even 1% would send the U.S. economy into an immediate, deflationary death-spiral (as I have explained in many previous commentaries).

    d) Debt-saturated Western government balance sheets cannot tolerate any further large increases in debt without a series of domino-like debt defaults.

    e) Because of the factors above, the only way to prop-up the Treasuries market (and fraudulently maintain prices at the highest levels in history) was to create a mountain of unofficial/illegitimate money (i.e. counterfeit it), and then use that unofficial currency to buy these worthless Treasuries.

    For those clinging to the belief that there must be some rational/legitimate explanation for the paper-trail uncovered by Lord James, he dispels that with some further observations of his own. To begin with, there are concrete financial protocols which have been created to integrate any/every new large batch of the bankers' fiat paper into global financial markets. None of those protocols was followed.

    Along the way with this scam, Lord James also pointed out that $100's of billions in profits were generated, with none of those profits ever being recorded let alone reported (and taxed). In short, this is every bit as illegal as the $100's of billions in heroin-trade profits laundered by Wall Street each year - from the poppy fields of Afghanistan. For those pointing out that the fraudulent U.S. Treasuries market hasn't (yet) required $15 trillion in funny-money to extend this Ponzi-scheme, obviously the banksters can come up with plenty of other uses for their counterfeited/laundered money.

    Where do people think that the Plunge Protection Team comes up with its own capital for its daily manipulations of U.S. markets?

    Ultra-leveraged Wall Street balance sheets (greater than 30:1) only required a drop in U.S. housing prices of 3% to take their entire paper empires to zero. U.S. housing prices have fallen more than ten times that far. We can only guess at how $trillions (in secret hand-outs) it has taken to delay the implosion of those fraud-factories even this long.

    This also explains the fanatical desperation which the Federal Reserve has shown in fighting even the tiniest request for disclosure about its "lending operations". When you're secretly counterfeiting $trillions every year, the last thing you want to hear is anything that even faintly resembles the word "audit".

    The U.S. Treasuries market is nothing but a gigantic (and clumsy) fraud. Along with the motive which I have previously supplied for this fraud, Lord James of Blackheath has added "means" and "opportunity" through his own diligent investigations. If the Rule of Law was not already dead in the United States, there is more than enough evidence here to justify a formal (and public) inquiry. Don't hold your breath!

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Apr 20 11:54 AM | Link | 2 Comments
  • The U.S. Prison-Cell Economy

    Every month, the U.S. propaganda machine plays the same game in the housing sector. It announces "new home starts". Then a few days later it announces "new home sales". But it never, ever, ever talks about the two numbers in the same news item.

    There is a very good reason for this: the two numbers have absolutely no connection in the real world. Month after month the U.S. government announces new home sales bouncing around a little above 300,000 units.

    (click to enlarge)

    However, month after month, year after year; the same propaganda machine announces new home starts at 500,000 or 600,000, and now 700,000 units per month.

    (click to enlarge)

    In other words, every month, year after year; the U.S. government announces that its home-builders have commenced construction on roughly twice as many units as they sell. This alone is proof of some massive deceit taking place. Obviously no business which builds double what it sells can remain in business. However this is only the beginning of the fraud with these statistics. It gets really interesting when we look at what the U.S. government is also saying about the inventories of new homes.

    (click to enlarge)

    So here is the question the propaganda machine will never answer: how can U.S. home-builders be constructing twice as many homes as they sell every month, while (supposedly) inventories have plummeted lower? The answer is that there is no answer. Obviously if U.S. home-builders are building more "homes" than they sell every month then inventories can only go higher and higher.

    Before the collapse of the U.S. real estate market (after the made-in-Wall Street "bubble" burst), the U.S. propaganda machine could have argued that a significant portion of this massive statistical discrepancy might have been explained by self-owned units, i.e. (small) home-builders building units for themselves (and thus they didn't need to sell those units to anyone). However, at that time U.S. house prices were sky-high; but building material costs were relatively low. It made sense for people to build their own homes.

    Today, that explanation cannot possibly account for more than a trivial portion of these phantom housing starts. Building material costs are relatively high, while house prices have collapsed. Even with the temporary lull in foreclosures, still a full third of all U.S. home sales are "distressed sales" - where buyers can purchase units at substantial discounts. It makes no sense at all to build your own home, when buyers can purchase a house for less than the cost of the land and building materials (and avoid the free labour).

    We know that we are not being told the truth here. The question is how are we being lied to? The most obvious answer is that the "new home starts" statistic is just another U.S. fantasy-number, conjured out of thin air, and with no connection to the real world - just like the monthly U.S. jobs reports. However that explanation will not suffice.

    Here's the problem. With sales of new homes having plummeted by more than two-thirds (and stayed at that bottom), and with the housing-crash having been especially precipitous, this directly implies that 2/3 of all U.S. home-builders should have been forced into bankruptcy.

    Yet while some smaller, regional home-builders have declared bankruptcy; none of the large, national builders have been forced out of business. They build 100's of thousands more units than they sell - every month - and yet somehow manage to stay in business.

    What if there was an easy/obvious explanation for this "somehow"? What if the two-party dictatorship which runs the U.S. had been told by their Oligarch masters to turn the U.S. economy into a prison-cell economy?

    Suddenly there is a way for all of these apparently contradictory numbers to make sense. What are the only "housing units" which a home-builder could build (and get paid for) without having to make a sale after construction was complete? Prison cells. This explanation accounts for how home-builders could build 100's of thousands of units more than they sell each month (while inventories declined). It explains how these home-builders could have avoided bankruptcy, despite losing more than 2/3 of their market.

    Moreover, we have evidence all around us that the U.S. government has willingly chosen the Dickensian "social policy" of warehousing millions of their own people in prisons. Indeed, CNN's Fareed Zakaria just referred to the U.S. as the "Incarceration Nation".

    The U.S. incarcerates about nearly six times as many people (760 per 100,000) as it's northern neighbour, Canada (131 per 100,000). It imprisons five times as many people as the UK, more than seven times as many as France, more than eight times as many as Germany, and more than twelve times as many as Japan.

    The obvious question which Americans should be asking themselves is this. Is their own population really five times more "criminal" than the worst "hooligan" nation in Europe; or is their own government simply five times more evil?

    In the U.S., the vast preponderance of evidence suggests that "evil" is the correct answer here. First of all, in the debt-wracked United States, providing humane conditions for the 2.4 million Americans being warehoused in its prisons is no longer a consideration. Individual states (like California) are in permanent violation of their own rules on living conditions for prisoners.

    To deal with that problem (or rather avoid dealing with it), virtually every state in the U.S. is turning to private prisons as the "solution" - since these prisons-for-profit have virtually no oversight, and less regulation of their prison standards than Guantanamo Bay. The U.S. government may not want the bad publicity associated with running hundreds of modern-day "Alcatraz's", but it sees nothing wrong with allowing all these private gulags to be built, shipping off millions of their own citizens into their custody, and then simply looking the other way.

    The real story here is the growth in numbers - and the inability to find any current total number of such facilities. In 1996 there were 47 private prisons in the U.S. By 2001 there were 158. By 2005 there were 416. Despite exhaustive internet searching (what passes for "research" these days), I was unable to come across even any estimates of the current number of private prisons in the U.S.

    However, with the charts above suggesting that construction of private prisons didn't really get serious until after the Crash of '08, one must assume that there are now thousands of private prison facilities across the U.S. Given the statistics on "new housing units" from the charts above, there would appear to have been somewhere between 5 million and 10 million new (private) prison beds constructed in the U.S. - just since 2008. That would be enough to roughly quadruple the total U.S. prison population, to somewhere around 10 million people (give or take a million).

    How can hundreds of private prisons be constructed in the U.S. each year without any publicity, or even bare numbers on this construction explosion? Simple. In the Orwellian, 21st century United States, any information which the government wants to keep away from the general public is simply branded a matter of "national security".

    Obviously there can be no "national security" reason to withhold information on the construction of an ordinary private prison. However, if an official from the Department of Homeland Security waves his magic wand and calls the private prison a "terrorist detention facility"; then suddenly any/every private prison so designated becomes a national secret.

    We still haven't gotten to the most deplorable aspect of the United States prison-cell economy: guaranteed "occupancy rates". Specifically, the U.S.'s private prison Oligarchs have decreed that in return for operating their low-budget, Alcatraz-style prison facilities that the states have to guarantee that at least 90% of those prison beds have to be filled at all times.

    In other words, we now have private corporations dictating to U.S. state governments that "justice" no longer be dispensed based upon what is appropriate for the accused, or even in the best interests of society - but solely on feeding enough bodies into the private prison mills.

    Why are the private prison Oligarchs insisting on these prisoner quotas? Because their other means of "guaranteeing" full prisons proved to be somewhat controversial: buying-off U.S. judges. Note that these private prison operators aren't only interested in warehousing adults. They're also very interested in locking-up youths. They're easier to control, while having lots of energy - which makes them very good slaves.

    This brings us to the final aspect of the U.S. prison-cell economy: slave labour. Having opened the floodgates to cheap, Chinese imported goods (with the manufacturing Oligarchs simply moving their plants to China); it's common knowledge that even being paid minimum wage that American workers cannot "compete" with (i.e. devalue their labour as low as) China. However, lock-up those same workers in a private prison, and suddenly you can pay them less than 1/10th of minimum wage. Et voila! The U.S. economy becomes "competitive" again.

    With apparently millions of empty, U.S. private prison beds already awaiting new "occupants" (and new facilities being built every day), it seems that both the private prison Oligarchs and the U.S. government have big plans for this prison-cell economy. This comes at a time when the U.S. crime rate has plummeted for most categories of crime, and violent crime rates are at a 40-year low. Americans are committing less and less real crimes, while the U.S. government and its Oligarch masters lock-up more and more of them each year - because it's profitable to do so.

    Each month, as we watch the propagandists play their games with U.S. "new housing" numbers, we should ponder the fact that perhaps one new prison bed is being constructed in the U.S. for every house now being built. If that doesn't make the U.S. a "prison-cell economy" today, just wait a few years.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Apr 20 11:52 AM | Link | 1 Comment
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