Wednesday, May 22, 2013

Feds' Bogus Threat of Terrorism to Hunt Down Black Liberation Activist

Labeling Assata Shakur a terrorist is the latest attempt by the government to rewrite the history of radical activists.

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America’s Bubble Economy Is Going To Become An Economic Black Hole

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What is going to happen when the greatest economic bubble in the history of the world pops?  The mainstream media never talks about that.  They are much too busy covering the latest dogfights in Washington and what Justin Bieber has been up to.  And most Americans seem to think that if the Dow keeps setting new all-time highs that everything must be okay.  Sadly, that is not the case at all.  Right now, the U.S. economy is exhibiting all of the classic symptoms of a bubble economy.  You can see this when you step back and take a longer-term view of things.  Over the past decade, we have added more than 10 trillion dollars to the national debt.  But most Americans have shown very little concern as the balance on our national credit card has soared from 6 trillion dollars to nearly 17 trillion dollars.  Meanwhile, Wall Street has been transformed into the biggest casino on the planet, and much of the new money that the Federal Reserve has been recklessly printing up has gone into stocks.  But the Dow does not keep setting new records because the underlying economic fundamentals are good.  Rather, the reckless euphoria that we are seeing in the financial markets right now reminds me very much of 1929.  Margin debt is absolutely soaring, and every time that happens a crash rapidly follows.  But this time when a crash happens it could very well be unlike anything that we have ever seen before.  The top 25 U.S. banks have more than 212 trillion dollars of exposure to derivatives combined, and when that house of cards comes crashing down there is no way that anyone will be able to prop it back up.  After all, U.S. GDP for an entire year is only a bit more than 15 trillion dollars.

But most Americans are only focused on the short-term because the mainstream media is only focused on the short-term.  Things are good this week and things were good last week, so there is nothing to worry about, right?

Unfortunately, economic reality is not going to change even if all of us try to ignore it.  Those that are willing to take an honest look at what is coming down the road are very troubled.  For example, Bill Gross of PIMCO says that his firm sees "bubbles everywhere"...

We see bubbles everywhere, and that is not to be dramatic and not to suggest they will pop immediately. I just suggested in the bond market with a bubble in treasuries and bubble in narrow credit spreads and high-yield prices, that perhaps there is a significant distortion there. Having said that, it suggests that as long as the FED and Bank of Japan and other Central Banks keep writing checks and do not withdraw, then the bubble can be supported as in blowing bubbles. They are blowing bubbles. When that stops there will be repercussions.
And unfortunately, it is not just the United States that has a bubble economy.  In fact, the gigantic financial bubble over in Japan may burst before our own financial bubble does.  The following is from a recent article by Graham Summers...

First and foremost, Japan is the second largest bond market in the world. If Japan’s sovereign bonds continue to fall, pushing rates higher, then there has been a tectonic shift in the global financial system. Remember the impact that Greece had on asset prices? Greece’s bond market is less than 3% of Japan’s in size.
For multiple decades, Japanese bonds have been considered “risk free.” As a result of this, investors have been willing to lend money to Japan at extremely low rates. This has allowed Japan’s economy, the second largest in the world, to putter along marginally.
So if Japanese bonds begin to implode, this means that:
1)   The second largest bond market in the world is entering a bear market (along with commensurate liquidations and redemptions by institutional investors around the globe).

2)   The second largest economy in the world will collapse (along with the impact on global exports).

Both of these are truly epic problems for the financial system.
And of course the entire global financial system is a giant bundle of debt, risk and leverage at this point.  We have never seen anything like this in world history.  When you step back and take a good, hard look at the numbers, they truly are staggering.  The following statistics are from one of my previous articles entitled "Why Is The World Economy Doomed? The Global Financial Pyramid Scheme By The Numbers"...

-$70,000,000,000,000 - The approximate size of total world GDP.

-$190,000,000,000,000 - The approximate size of the total amount of debt in the entire world.  It has nearly doubled in size over the past decade.

-$212,525,587,000,000 - According to the U.S. government, this is the notional value of the derivatives that are being held by the top 25 banks in the United States.  But those banks only have total assets of about 8.9 trillion dollars combined.  In other words, the exposure of our largest banks to derivatives outweighs their total assets by a ratio of about 24 to 1.

-$600,000,000,000,000 to $1,500,000,000,000,000 - The estimates of the total notional value of all global derivatives generally fall within this range.  At the high end of the range, the ratio of derivatives to global GDP is more than 21 to 1.

The financial meltdown that happened back in 2008 should have been a wake up call for the nations of the world.  They should have corrected the mistakes that happened so that nothing like that would ever happen again.  Unfortunately, nothing was fixed.  Instead, our politicians and the central bankers became obsessed with reinflating the system.  They piled up even more debt, recklessly printed tons of money and kicked the can down the road for a few years.  In the process, they made our long-term problems even worse.  The following is a recent quote from John Williams of

The economic and systemic solvency crises of the last eight years continue. There never was an actual recovery following the economic downturn that began in 2006 and collapsed into 2008 and 2009. What followed was a protracted period of business stagnation that began to turn down anew in second- and third-quarter 2012. The official recovery seen in GDP has been a statistical illusion generated by the use of understated inflation in calculating key economic series (see Public Comment on Inflation). Nonetheless, given the nature of official reporting, the renewed downturn likely will gain recognition as the second-dip in a double- or multiple-dip recession.
What continues to unfold in the systemic and economic crises is just an ongoing part of the 2008 turmoil. All the extraordinary actions and interventions bought a little time, but they did not resolve the various crises. That the crises continue can be seen in deteriorating economic activity and in the panicked actions by the Federal Reserve, where it proactively is monetizing U.S. Treasury debt at a pace suggestive of a Treasury that is unable to borrow otherwise.
And there are already lots of signs that the next economic downturn is rapidly approaching.

For example, corporate revenues are falling at Wal-Mart, Proctor and Gamble, Starbucks, AT&T, Safeway, American Express and IBM.

Would revenues at Wal-Mart be falling if the economy was getting better?

U.S. jobless claims hit a six week high last week.  We aren't in the danger zone yet, but once they hit 400,000 that will be a major red flag.

And even though we are still in the "good times" relatively speaking, the federal government is already talking about tightening welfare programs.  In fact, there are proposals in Congress right now to make significant cuts to the food stamp program.

If food stamps and other welfare programs get cut, that is going to make a lot of people very, very angry.  And that anger and frustration will get even worse when the next economic downturn strikes and millions of people start losing their jobs and their homes.

What we are witnessing right now is the calm before the storm.  Let us hope that it lasts for as long as possible so that we can have more time to prepare.

Unfortunately, this bubble of false hope will not last forever.  At some point it will end, and then the pain will begin.

How America's National Security Apparatus -- in Partnership With Big Corporations -- Cracked Down on Dissent

A new report is an eye-opening look into how the U.S. counter-terror apparatus was used to track the Occupy movement.

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Processed Meats Declared Too Dangerous for Human Consumption

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The World Cancer Research Fund (WCRF) has just completed a detailed review of more than 7,000 clinical studies covering links between diet and cancer. Its conclusion is rocking the health world with startling bluntness: Processed meats are too dangerous for human consumption. Consumers should stop buying and eating all processed meat products for the rest of their lives.
Processed meats include bacon, sausage, hot dogs, sandwich meat, packaged ham, pepperoni, salami and virtually all red meat used in frozen prepared meals. They are usually manufactured with a carcinogenic ingredient known as sodium nitrite. This is used as a color fixer by meat companies to turn packaged meats a bright red color so they look fresh. Unfortunately, sodium nitrite also results in the formation of cancer-causing nitrosamines in the human body. And this leads to a sharp increase in cancer risk for those who eat them.
A 2005 University of Hawaii study found that processed meats increase the risk of pancreatic cancer by 67 percent. Another study revealed that every 50 grams of processed meat consumed daily increases the risk of colorectal cancer by 21 percent. These are alarming numbers. Note that these cancer risks do not come from eating fresh, non-processed meats. They only appear in people who regularly consume processed meat products containing sodium nitrite.
Sodium nitrite appears predominantly in red meat products (you won’t find it in chicken or fish products). Here’s a short list of food items to check carefully for sodium nitrite and monosodium glutamate (MSG), another dangerous additive:
  • Beef jerky
  • Bacon
  • Sausage
  • Hot dogs
  • Sandwich meat
  • Frozen pizza with meat
  • Canned soups with meat
  • Frozen meals with meat
  • Ravioli and meat pasta foods
  • Kid’s meals containing red meat
  • Sandwich meat used at popular restaurants
  • Nearly all red meats sold at public schools, restaurants, hospitals, hotels and theme parks
If sodium nitrite is so dangerous to humans, why do the FDA and USDA continue to allow this cancer-causing chemical to be used? The answer, of course, is that food industry interests now dominate the actions by U.S. government regulators. The USDA, for example, tried to ban sodium nitrite in the late 1970′s but was overridden by the meat industry.5 It insisted the chemical was safe and accused the USDA of trying to “ban bacon.”
Today, the corporations that dominate American food and agricultural interests hold tremendous influence over the FDA and USDA. Consumers are offered no real protection from dangerous chemicals intentionally added to foods, medicines and personal care products.
You can protect yourself and your family from the dangers of processed meats by following a few simple rules:
  1. Always read ingredient labels.
  2. Don’t buy anything made with sodium nitrite or monosodium glutamate.
  3. Don’t eat red meats served by restaurants, schools, hospitals, hotels or other institutions.
And finally, eat more fresh produce with every meal. There is evidence that natural vitamin C found in citrus fruits and exotic berries (like camu camu) helps prevent the formation of cancer-causing nitrosamines, protecting you from the devastating health effects of sodium nitrite in processed meats. The best defense, of course, is to avoid eating processed meats altogether.

Our Govt. Is Turning into a Surveillance State That's Almost Impossible to Stop

 The US government extensively monitors its citizens' internet activities, with dangerous effects on personal liberties.

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US seeks defence agreement with Maldives

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The US is pushing the Maldivian government to sign a Status of Forces Agreement (SOFA) to build military bases in the island country, which is in the middle of the Indian Ocean. It is another significant move by the Obama administration in its aggressive “pivot to Asia” to militarily encircle China in the vast Indo-Pacific theatre.
It is not new for the US military to have access to Maldivian infrastructure, following a number of agreements in the 2000s. In 2010, Washington signed an “Acquisition and Cross Service Agreement” (ACSA) with the previous government of President Mohamed Nasheed, which allowed the US to use its airport and sea port facilities. The new pact, however, will significantly expand the earlier arrangements.
A copy of the agreement, entitled “Status of Forces and Access to and Use of Facilities in the Maldives” , has been obtained and published by the Maldivian current affairs blog, DhivehiSittee. The SOFA will provide a legal framework for a virtually unrestrained US presence, including military bases, in the archipelago of 1,192 islands.
Maldives is located strategically near major sea lanes. More than 80 percent of the world’s seaborne trade in oil passes through Indian Ocean chokepoints, with 40 percent going through the Persian Gulf’s Strait of Hormuz, 35 percent through the Strait of Malacca and 8 percent through the Bab el-Mandab Strait, at the base of the Red Sea.
Naval and air operations from Maldives could potentially threaten countries that depend on these sea lanes for energy supplies and raw materials. China, with its vast demand for oil and minerals from the Middle East and Africa, is the most obvious target.
The proposed 10-year SOFA provides “for the temporary presence and activities of US forces” in certain situations, but does not specify those situations. The draft declares that “US personnel shall be accorded the privileges, exemptions and immunities equivalent to those accorded to diplomats under Vienna Conventions.” In other words, disciplinary control and jurisdiction over US personnel will be in the hands of the Pentagon, with immunity from Maldivian law.
American personnel and contractors will have freedom of movement and access to agreed facilities, including for transportation, storage and training. Aircraft, vehicles and vessels “may enter, exit, and move freely within territory and territorial seas of the republic.” They will not be subject to taxation or inspection.
The US “shall be responsible for the construction, development, operations, and maintenance cost of agreed facilities and areas provided for the exclusive use of its forces.” This clause would permit the building of US military bases.
The US will be allowed to have its own telecommunication systems, together with access to airports, sea ports and agreed facilities and areas. “All disputes shall be resolved through consultation, and shall not be referred to any national or international court.” This means that the Maldivian government will have no legal jurisdiction over the US military and its personnel.
Robert Blake, the US assistant secretary for South and Central Asia affairs, confirmed the agreement with the Maldives, but clamed there were no plans to build US military bases there. “This SOFA does not imply some new up-ticks in a military cooperation or certainly does not imply any new military presence,” he insisted.
Washington’s assurances cannot be taken at face value. Similar agreements with other countries, including the puppet regime of Afghan President Hamid Karzai, have involved the construction of major US bases.
On March 27, top Maldivian government officials, including the defence, tourism and home ministers, vice president and police commissioner, were flown to the US aircraft carrier USS John C Stennis, which had sailed near the Maldives. No information was released about what was discussed with the delegation.
After the visit, the two countries signed an agreement to install a border control system in the Maldives using US information technology. This has effectively placed the country’s entry and exit points under American surveillance.
The Maldives SOFA will enhance the United States’ strategic position in the Indian Ocean. A defence analyst in India, M. K. Bhadrakumar said it would be “a tectonic shift in the geopolitics of the Indian Ocean if the US secures a military presence in the Maldives.”
The Pentagon currently operates one of the largest bases outside the US in Diego Garcia, further to the south in the Indian Ocean, through an arrangement with Britain, which retains colonial control. The Diego Garcia base has multiple landing strips for strategic bombers and port facilities for the largest US naval vessels.
China is seeking closer economic and strategic relations with the Maldives. A political crisis erupted in the Maldives when President Mohamed Nasheed was removed in a coup early last year by Mohamed Waheed, who was clearly backed by the US and India. The coup came after years of media speculation that China was seeking to build a submarine base in the Maldives, which some American strategic analysts had warned could pose a challenge to US forces in Diego Garcia, as well as the Indian navy in the region. (See: “Maldives president ousted in US-backed coup”)
Just 400 nautical miles south of India, any Chinese naval presence in the Maldives is a concern to New Delhi, which depicts China’s development of major ports in Sri Lanka, Pakistan and Bangladesh as a “string of pearls” strategy to potentially station naval vessels around India.
Within the Maldivian ruling elite, there are concerns about the proposed US defence pact, because of growing economic ties with China. China has become the largest source of visitors to the Maldives, which depends heavily on tourism. Last year, Beijing offered loans of $US500 million to the Maldives, equivalent to one quarter of its $2 billion annual economic output.
Opposition Maldivian Democratic Party (MDP) spokesman Hamid Abdul Gafoor declared: “We are wondering what our other international partners—India, Australia, etc.—think about this.” Ex-president Nasheed, ousted in last year’s coup, declared that the MDP would campaign against the agreement.
Defence Minister Mohamed Nazim sought to placate public concern by referring to the ACSA deal signed by Nasheed with the US in 2010, claiming that the SOFA was nothing new. His comments only confirm the government’s intention to proceed with the agreement, thus enabling the US to alter the strategic landscape of the Indian Ocean.

Financial bubbles creating conditions for new crash

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It is a sure sign of the systemic breakdown of the global capitalist system that the very measures put in place to try to prevent a crisis are creating the conditions for a financial meltdown beyond even the scale of 2008.
For almost five years the world’s major central banks have pumped an estimated $7 trillion into financial markets with the stated aim of trying to spark an economic recovery. Economic data from around the world indicate that it has been a manifest failure.
The statistics on price levels are among the most significant. These show that rather than prices increasing—a sign of recovery in so-called “normal” conditions—deflationary pressures are intensifying.
In the US, consumer prices fell by 0.4 percent in May, the biggest decline since late 2008, following a 0.2 percent decline in April. In Europe, excluding food and energy costs, consumer prices in the 17-member euro zone rose by just 1 percent in April from a year earlier.
The downtrend has far-reaching implications. Confronted with falling prices for their products, major firms and corporations seek to make profits not by investing and expanding production, as they would seek to do if a recovery were underway, but by savage cost-cutting coupled with financial speculation. The consequent cuts in pay and jobs lead to a reduction in consumer demand, further fueling the deflationary trend.
Other economic data highlight this process. Last month, US industrial production fell by 0.5 percent, compared to a projected decline of 0.2 percent, prompting predictions that results for the second quarter would be even worse than the last quarter of 2012, when the US economy showed virtually no expansion.
In the euro zone, unemployment has risen for the 23rd consecutive month and now stands at 12.1 per cent, a 1.1 percent increase over the level a year ago. The euro zone economy contracted by 0.2 percent in the first quarter, meaning the current contraction has lasted longer than that experienced in 2008-2009.
Since the onset of the breakdown in 2008, the prospect has been held out that China could provide the basis for the long-term expansion of the global economy. But while industrial production and retail sales both showed a significant rise last month, pointing to economic growth of about 7.5 percent this year, these hopes are being dashed.
In a recent article pointing to the absence of “a strong source of demand growth” anywhere in the global economy, the Financial Times noted that “worries” about the Chinese economy were “widespread.” In the long term it was clear that the double-digit growth of the past decade was a thing of the past, while in the short term, despite an expansion of credit the rise in GDP produced by this lending was near its lowest level for a decade.
In contrast to the trends in the real economy, financial markets are experiencing an unprecedented boom. The Dow Jones Industrial Average is up by 15 percent since the Fed launched its third round of quantitative easing last September. In Japan, the Nikkei index has climbed 44 percent since last December and the election of the Abe government, which demanded that the Bank of Japan boost the money supply. In the UK, the FTSE index has gained 20 percent in the last six months on the back of quantitative easing by the Bank of England, despite the fact that the British “recovery” is weaker even than that experienced in the Great Depression, while European stock markets have gained 30 percent since last July.
These increases are being fuelled entirely by the trillions of dollars being pumped into the financial system by the major central banks.
But rather than expressing a “recovery,” the booming share markets are a fever chart of the deepening crisis of the capitalist system. Never in the history of world capitalism has there been such a divergence of financial markets from underlying economic processes.
The unprecedented rise in global markets has sparked concerns that the conditions are being created for a crash. As Financial Times columnist Gillian Tett noted, “[W]hile the flood of central bank liquidity is enabling the system to absorb small shocks, it is also masking a host of internal contradictions and fragilities that could surface if a shock hits” with the “potential for… future violent instability rising apace.”
While any rational analysis points to the fact that the present conditions are preparing the way for a disaster, the frenzy of speculation continues according to its own mad logic. As the then-chief executive of the US banking giant Citigroup, Chuck Prince, famously remarked in July 2007: “As long as the music is playing, though, you’ve got to get up and dance.” Little more than a year later, the global financial system plunged into its worst crisis since the 1930s.
Today the situation is potentially even more explosive than five years ago. This is because, unlike 2008, the central banks, having bought up trillions of dollars worth of government and other financial assets, are key market players themselves, and so will be directly impacted by a collapse of financial markets.
Increasingly, they are being caught in a trap of their own making. Withdrawal of the financial stimulus measures threatens to collapse the bubble. At the same time, the pumping out of still more money draws them deeper into the mire.
Last week, economists at the International Monetary Fund published an analysis warning that ending easy money policies could result in the central banks suffering severe losses as interest rates spiked and bond prices fell. The Federal Reserve could experience a loss equivalent to as much as 4 percent of GDP ($628 billion), the Bank of Japan could lose 7.5 percent of GDP, and the Bank of England almost 6 percent.
In other words, a new financial shock could call the stability of the central banks themselves into question. Unlike the situation in 2008-2009, they would be unable to mount a rescue operation.
The deepening global crisis of capitalism has the most far-reaching political implications.
The past five years have seen the pumping of hundreds of billions of dollars into the coffers of the banks and speculators, and the financial elite that benefits from their activities, while the impoverishment of ever broader sections of the population has continued unabated.
These measures, far from producing an economic “recovery,” have prepared the way for even bigger disasters.
The international working class must prepare its own independent response: the political struggle for the overthrow of the failed capitalist system through a revolutionary struggle for political power and the reconstruction of society.