Tuesday, August 31, 2010

I.O.U.S.A.............

I.O.U.S.A.: Byte-Sized - The 30 Minute Version

By now, you may have heard about our acclaimed documentary I.O.U.S.A., a film that boldly examines the rapidly growing national debt and its consequences for the United States and its citizens. The film has been a huge hit, getting rave reviews from Roger Ebert and others.

Now, we proudly release a 30-minute condensed version of I.O.U.S.A. designed specifically for watching and sharing on the web - for free at this link.

http://www.youtube.com/watch?v=O_TjBNjc9Bo&feature=related

So if you haven't had a chance to see the movie yet, watch the condensed I.O.U.S.A. today. If you've already seen it in a theater, check out the abbreviated version for a refresher.

Then, visit

http://www.IOUSAtheMovie.com and join us in our Fiscal Wake-Up Movement. Together, we can make American fiscal responsibility a reality.

YOU MAY ALSO WANT TO WATCH THIS SHORT VIDEO CLIP OF DAVID WALKER BEING INTERVIEWED ON 60 MINUTES.

http://www.youtube.com/watch?v=UuCgxDbOgqM&feature=related

PLEASE REMEMBER THAT WHEN THIS MOVIE WAS MADE JUST A FEW YEARS AGO, THE NATIONAL DEBT WAS 8.7 TRILLION. IT IS NOW ALMOST 14 TRILLION DOLLARS. AT THIS RATE OF INCREASE, OUR ECONOMY WILL COLLAPSE UNDER THE WEIGHT OF THIS OUTRAGEOUS DEBT BECAUSE OUR FOREIGN INVESTORS WON'T INVEST IN A FAILING ENTERPRISE. OUR CURRENCY WILL COLLAPSE. GAME OVER!

Forget Debt To GDP, It's Debt To Revenue That Matters.....................

Forget Debt To GDP, It's Debt To Revenue That Matters--And The U.S. Is The Worst

Morgan Stanley have published a report titled "Ask Not Whether Governments Will Default, But Howand while it makes some interesting points about who is going to get hit when sovereigns begin to exact "Financial Oppression" on creditors what we're most interested in is the discussion of debt to GDP ratios.

From Morgan Stanley's, Arnaud Marès:

Whatever the size of a government's liabilities, what matters ultimately is how they compare to the resources available to service them. One benefit of sovereignty is that governments can unilaterally increase their income by raising taxes, but they will only ever be able to acquire in this way a fraction of GDP. Debt/GDP therefore provides a flattering image of government finances. A better approach is to scale debt against actual government revenues (see Exhibit 2). An even better approach would be to scale debt against the maximum level of revenues that governments can realistically obtain from using their tax-raising power to the full. This is, inter alia, a function of the people's tolerance for taxation and government interference. Seen from this angle, the US federal debt no longer compares quite so favorably with that of European governments.

And Morgan Stanley put together a chart to make that comparison. The U.S. position, relative to its ability to raise revenue, looks weak compared to Europe:   EVEN GREECE IS BETTER OFF THAN WE ARE!

Debt Revenue 825

It is, in many ways, no different than looking at a company. Recall Q2 earnings. Investors were not that concerned about surging profits, made through companies cutting spending, but rather the decline in revenues.

And while current bond yields or CDS pricing do not reflect that position in terms of U.S. sovereign debt, maybe there is an implied market assumption that the U.S. government could take in more revenue relative to its GDP, by either expanding revenues through economic growth or increasing taxes.

And pushing this approach a bit further, even if the U.S. were to see a cut in government spending, increasing "profits" temporarily, would investors not be more concerned that revenues, via the taxes paid by those in government work, would decline?



Why Another Fiscal Stimulus Will Flop...............

Why Another Fiscal Stimulus Will Flop

Should lawmakers go for another round of fiscal stimulus?

Mohammed El-Erian argues against the idea, saying it won't do much good, and that instead, something more structural is called for.

Policymakers must break this active inertia by implementing a structural vision to accompany their current cyclical focus. Measures are needed to address key issues, which include the change in drivers of growth and employment creation; the high risk of skill erosion and lost labor productivity; financial deleveraging in the private sector; debt overhangs; the uncertain regulatory environment; and the unacceptably high risks facing the most vulnerable segments of society.

An interesting question involves the extent to which short-term issues create structural issues.

David Goldman (among others) keeps pointing to this chart, showing the median duration of unemployment as a reason to be negative on the economy, since the longer one is unemployed, the lower the odds they will ever really make it back into the work force, thus, potentially, becoming structurally unemployed, and not merely the victims of a dip in the economy.

chart



ANALYSTS ARE A CONTRARY INDICATOR.........

START HIGH, NOTHING BUT BLUE SKY ..................... THEY ARE SALESMEN.
 

THIS Is What A Bear Market In Housing Looks Like.......... MUST SEE CHARTS

THIS Is What A Bear Market In Housing Looks Like

 
ANYONE INVESTING IN REAL ESTATE, OF ALMOST ANY KIND AT THIS POINT, IS STILL GOING TO GET BURNED REAL BAD!
 
COMMERCIAL, RESIDENTIAL AND EVEN STORAGE UNITS AND CONVENIENCE STORES ARE DOING VERY POORLY.  THE ONLY THING I WOULD TOUCH WOULD BE LARGE PARCELS OF LAND, FARMS, RANCHES, UNDEVELOPED URBAN LAND AT A VERY GOOD DISCOUNTED PRICE FROM A DISTRESSED SELLER FOR CASH, OR I WOULD SIMPLY WAIT. BECAUSE EVERYTHING IS GOING TO GET CHEAPER. FEW GUARANTEES IN INVESTING, THIS IS GUARANTEED! EVERYTHING GETS CHEAPER AND MANY MORE RETAILERS ARE GOING TO GO BUST.  
 
HIGH UNEMPLOYMENT THAT IS GETTING WORSE, WILL BE MADE MUCH WORSE BY THE NEXT ROUND OF REAL ESTATE PROBLEMS. IN TURN THIS WILL CAUSE A REAL PROBLEM FOR BANKS WHO HOPE THAT ALREADY TERRIBLE ASSET VALUATIONS WON'T GET WORSE AND EXPOSE THEIR FANTASY REAL ESTATE VALUATIONS FOR THE PURE FICTION THAT THEY ARE.  A LOT OF BANKS ARE GOING TO GO BUST AS THE NEXT PHASEV OF THIS CRISIS PLAYS OUT.
 
 
 

 

 
 

CHINA: Rumors Spread That Central Bank Head Has Defected........

CHINA: Rumors Spread That Central Bank Head Has Defected
 
Rumors have circulated in China that People's Bank of China (PBC) Gov. Zhou Xiaochuan may have left the country. The rumors appear to have started following reports on Aug. 28 which cited Ming Pao, a Hong Kong-based news agency, saying that because of an approximately $430 billion loss on U.S. Treasury bonds, the Chinese government may punish some individuals within the PBC, including Zhou. Although Ming Pao on Aug. 30 published a report on its website indicating that the prior report was fabricated by a mainland news site that had attributed the false information to Ming Pao, rumors of Zhou's defection have spread around China intensively, and Zhou's name has been blocked from Internet search engines in China.

Reports by state-run Chinese media appeared to send strong indications that Zhou is in no trouble at the moment. However, the release of this rumor and its dispersion throughout the public is significant, particularly as the Communist Party of China (CPC) is preparing for a leadership transition in 2012.

Chinese state-run media and official government websites have run several high-profile reports about Zhou, which should be seen as an attempt to refute the rumors. The PBC website published two articles on its homepage reporting on Zhou's meeting with visiting Japanese Financial Services Minister Shozaburo Jimi during the third China-Japan high-level economic dialogue as well as a meeting with an Italian delegation. Xinhua news agency reported that Zhou told the PBC Party Committee Enlargement meeting on Aug. 30 it should "continue to implement justice and strengthen legislative work in the financial system." Prior to this news, Zhou appeared at the 2nd annual conference of the heads of the Chinese, Japanese and Korean central banks held on Aug. 3, and his most recent public appearance was Aug. 10 for China's Financial System Anti-corruption Construction Exhibition.

Zhou is known to have lofty political ambitions and is believed to be a close ally to former Chinese President Jiang Zemin, as well as a core figure for Jiang's "Shanghai Gang." There has been no shortage of rumors about Zhou's possible dismissal in the past five years, as he is believed to be associated with several high-level financial scandals. For example, Zhou was rumored to be under "shuanggui," a form of house arrest administered by the CPC, during the massive crackdown of Shanghai Party Secretary Chen Liangyu in 2006, which was perceived in the country as a crackdown of the Shanghai Gang and part of Hu's effort to consolidate power ahead of the 2007 power transition. There was also a rumor that he might have been detained following the investigation and arrest of Wang Yi, the vice governor of the China Development Bank, along with several other officials in the financial circle. Currently, several financial scandals are still under investigation, and it is likely that Zhou, as PBC governor and one of the most powerful economic players in the country, could be associated with some cases. Therefore, whether or not the rumor is true at this time, the leaking of this news is very likely to be associated with a power struggle within the Communist Party's economic hierarchy.

 

 



The ISM Is About To Tank..............

The ISM Is About To Tank

We've now received regional data from the various regional Fed banks, including Philadelphia and Dallas, and across the board we're seeing a slowdown. Thus you shouldn't be surprised that the ISM is about to tank. This chart shows the connection quite nicely. The number comes out Wednesday.

chart of the day, ism pmi, aug 2010



Monday, August 30, 2010

The 15 Best Things Warren Buffett Has Ever Said About Investing.........................

The 15 Best Things Warren Buffett Has Ever Said About Investing

The essentials first
 
The essentials first
 
"Rule No. 1: never lose money; rule No. 2: don't forget rule No. 1"

Source: The Tao of Warren Buffett, by Mary Buffett and David Clark

Think about this one

Think about this one
 
"I am a better investor because I am a businessman, and a better businessman because I am no investor."

Source:  Forbes.com - Thoughts On The Business Life

Berkshire is like the Met

Berkshire is like the Met
 
"You can sell it to Berkshire, and we'll put it in the Metropolitan Museum; it'll have a wing all by itself; it'll be there forever. Or you can sell it to some porn shop operator, and he'll take the painting and he'll make the boobs a little bigger and he'll stick it up in the window, and some other guy will come along in a raincoat, and he'll buy it." - On what makes people sell to him

Source: Bloomberg

Wonderful v Fair

Wonderful v Fair

"It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price."

Source: Letter to shareholders, 1989

No need to be a genius

No need to be a genius
 
"You don't need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with 130 IQ."

Source: Warren Buffet Speaks, By Janet Lowe, via msnbc.msn

The Fourth Law Of Motion

The Fourth Law Of Motion
 
"Long ago, Sir Isaac Newton gave us three laws of motion, which were the work of genius. But Sir Isaac's talents didn't extend to investing: He lost a bundle in the South Sea Bubble, explaining later, "I can calculate the movement of the stars, but not the madness of men." If he had not been traumatized by this loss, Sir Isaac might well have gone on to discover the Fourth Law of Motion: For investors as a whole, returns decrease as motion increases."

Source: Letters to shareholders, 2005

Time is ticking away

Time is ticking away
 
"Time is the friend of the wonderful business, the enemy of the mediocre."

Source: Letters to shareholders 1989

Watch carefully...

Watch carefully...
 
"After all, you only find out who is swimming naked when the tide goes out."

Source: Letter to shareholders, 2001

Timing is everything

Timing is everything
 
"Investors should remember that excitement and expenses are their enemies. And if they insist on trying to time their participation in equities, they should try to be fearful when others are greedy and greedy only when others are fearful."

Source: Letter to shareholders, 2004

No limits

No limits
 
"When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever."

Source: Letter to shareholders, 1988

Game pressure

Game pressure
 
"The stock market is a no-called-strike game. You don't have to swing at everything--you can wait for your pitch. The problem when you're a money manager is that your fans keep yelling, 'Swing, you bum!'"

Source: The Tao of Warren Buffett, by Mary Buffett and David Clark, via Engineeringnews.com

About Socks and Stocks

About Socks and Stocks
 
"Long ago, Ben Graham taught me that 'Price is what you pay; value is what you get.' Whether we're talking about socks or stocks, I like buying quality merchandise when it is marked down."

Source: Letter to shareholders, 2008

The "lack of change" appeal

The "lack of change" appeal

" Our approach is very much profiting from lack of change rather than from change. With Wrigley chewing gum, it's the lack of change that appeals to me. I don't think it is going to be hurt by the Internet. That's the kind of business I like."

Source: Businessweek, 1999

The right moment to strike

The right moment to strike
 
"The best thing that happens to us is when a great company gets into temporary trouble...We want to buy them when they're on the operating table."

Source: Businessweek, 1999

Choose sleep over extra profit

Choose sleep over extra profit
 
" I have pledged – to you, the rating agencies and myself – to always run Berkshire with more than ample cash. We never want to count on the kindness of strangers in order to meet tomorrow's obligations. When forced to choose, I will not trade even a night's sleep for the chance of extra profits."

 Source: Letter to shareholders, 2008



Without Government Spending, GDP Growth Would Have Been Less Than Half Of What It Was.....................

Without Government Spending, GDP Growth Would Have Been Less Than Half Of What It Was

The latest revision for U.S. Q2 GDP came in at 1.6%, which was higher than the 1.3% reading expected by consensus, but well below the 2.4% value previously reported by the government. Thing is, the latest GDP report shows just how dependent the U.S. economy was on government spending during the second quarter.

Government spending contributed +0.86% to the 1.6% GDP growth value, which was one of the highest quarterly government contribution to GDP since at least 2007. The only quarters to beat it since the beginning fo 2007 were Q3 of 2008 and Q2 of 2009, at +1.04% and +1.24% respectively.

Sans the 0.86% government spending boost, U.S. GDP would have grown by just 0.74% during Q2 of this year. This is shown by the right-hand bar below.

Yes the economy is more complex than such straight subtractions, but while the exact GDP effect by government is debatable, what's clear is that Q2 relied heavily upon government spending. Government spending's +0.86% contribution accounts for more than half of GDP growth. To put this in perspective, even during all of 2009, the 'big stimulus' year, government spending only contributed +0.32% to GDP. Thus Q2's +0.86% is nothing to sneeze at relative to a tiny +1.6% total growth rate.

This sheds light on the challenge for U.S. Q3 GDP, as government spending support is expected to wane going forward.

chart of the day, q2 2010 gdp, government spending

WHEN THE GOLD PRICE WAS FIXED A $35............

 

ALAN GREENSPASM'S LEGACY............IT IS HIS FAULT

QUANTITATIVE PONZINOMICS FOR DUMMIES.............. BEN'S BEDSIDE READING

QUANTITATIVE PONZINOMICS FOR DUMMIES
 

PERIODIC TABLE OF WALL STREET CRIMINAL ELEMENTS..............THIS IS GREAT

THERE ARE A WHOLE LOT OF PEOPLE, VERY RICH, VERY POWERFUL, VERY RESPECTED PEOPLE ON WALL STREET AND IN OUR GOVERNMENT WHO ABSOLUTELY SHOULD EITHER BE HUNG OR IN JAIL. 
 

Friday, August 27, 2010

LAUGH A LITTLE............. HAVE A GOOD WEEKEND

THE NEW PRIEST'S FIRST MASS

A new Priest at his first mass was so nervous he could hardly speak. After mass he asked the Monsignor how he had done.

The Monsignor replied, "When I am worried about getting nervous on the pulpit, I put a glass of vodka next to the water glass. If I start to get nervous, I take a sip."

So next Sunday he took the Monsignor's advice. At the beginning of the sermon, he got nervous and took a drink. He proceeded to talk up a storm.

Upon his return to his office after the mass, he found the following note on the door:

1) Sip the vodka, don't gulp.

2) There are 10 commandments, not 12.

3) There are 12 disciples, not 10.

4) Jesus was consecrated, not constipated.

5) Jacob wagered his donkey, he did not bet his ass.

6) We do not refer to Jesus Christ as the late J.C..

7) The Father, Son, and Holy Ghost are not referred to as Daddy, Junior and the Spook.

8) David slew Goliath; he did not kick the shit out of him..

9) When David was hit by a rock and was knocked off his donkey, don't say he was stoned off his ass.

10) We do not refer to the cross as the 'Big T.'

11) When Jesus broke the bread at the last supper he said, "Take this and eat it for this is my body.." He did not say,"Eat me."

12) The Virgin Mary is not called 'Mary with the Cherry'.

13) The recommended grace before a meal is not: Rub-A-Dub-Dub thanks for the grub, Yeah God.

14) Next Sunday there will be a taffy pulling contest at St. Peter's not a peter pulling contest at St. Taffy's.
 

NOT IN NORTH CAROLINA

A father watched his young daughter playing in the garden.

He smiled as he reflected on how sweet and pure his little girl was.

Tears formed in his eyes as he thought about her seeing the wonders of nature through such innocent eyes.

Suddenly she just stopped and stared at the ground.

He went over to her to see what work of God had captured her attention.

He noticed she was looking at two spiders mating.

'Daddy, what are those two spiders doing?' she asked.

'They're mating,' her father replied.

'What do you call the spider on top?' she asked.

A Daddy Longlegs,' her father answered.

'So, the other one is a Mommy Longlegs?' the little girl asked.

As his heart soared with the joy of such a cute and innocent question he replied, 'No dear. Both of them are Daddy Longlegs.'

'The little girl, looking a little puzzled, thought for a moment, then lifted her foot and stomped them flat.

'Well", she said, "that may be OK in California , but we're not having any of that shit in North Carolina."
 

GOTTA PEE

Two women friends had gone for a girls' night out. Both were very faithful and loving wives, however They had gotten overly-enthusiastic on the Bacardi Breezers.

Incredibly drunk and walking home they needed to Pee, so they stopped in the cemetery. One of them had nothing to wipe with so she thought She would take off her panties and use them.

Her friend however was wearing a rather expensive Pair of panties and did not want to ruin them. She was lucky enough to squat down next to a grave That had a wreath with a ribbon on it, so she proceeded to wipe with that.

After the girls did their business, they proceeded to Go home.

The next day, the husband of one of the women was concerned That his normally sweet and innocent wife was still in bed hung over, so he phoned the other husband and said:

"These girl nights have got to stop! I'm starting to suspect the worst. My wife came home with no panties!!"

"That's nothing," said the other husband, "Mine came back with a card stuck to her ass that said.....

'From all of us at the Fire Station. We'll never forget you.' "
 

A CHANGE OF HEART IN TEXAS

Here in Texas, where I live, there is a town called New Braunfels,where there is a large German-speaking population.

One day, a local rancher driving down a country road noticed a man using his right hand to drink water from the rancher's stock pond.

The rancher rolled down his window and shouted: "Sehr angenehm! Trink das wasser nicht. Die kuhen haben dahin gesheissen." Which means:

("Glad to meet you! Don't drink the water. The cows have sh** in it.")

The man shouted back: "I'm from New York and just down here campaigning for Obama's health care plan. I can't understand you. Please speak in English."

The rancher replied: "Please use both hands, you'll get more."
 

TEACHING MATH

Last week I purchased a burger at Burger King for $1.58. The counter girl took my $ 2 and I was digging for my change when I pulled 8 cents from my pocket and gave it to her. She stood there, holding the nickel and 3 pennies, while looking at the screen on her register. I sensed her discomfort and tried to tell her to just give me two quarters, but she hailed the manager for help. While he tried to explain the transaction to her, she stood there and cried. Why do I tell you this? Because of the evolution in teaching math since the 1950s:

1. Teaching Math In 1950s

A logger sells a truckload of lumber for $100. His cost of production is 4/5 of the price. What is his profit ?

2. Teaching Math In 1960s

A logger sells a truckload of lumber for $100. His cost of production is 4/5 of the price, or $80. What is his profit?

3. Teaching Math In 1970s

A logger sells a truckload of lumber for $100. His cost of production is $80. Did he make a profit?

4. Teaching Math In 1980s

A logger sells a truckload of lumber for $100. His cost of production is $80 and his profit is $20. Your assignment: Underline the number 20.

5. Teaching Math In 1990s

A logger cuts down a beautiful forest because he is selfish and inconsiderate and cares nothing for the habitat of animals or the preservation of our woodlands. He does this so he can make a profit of $20. What do you think of this way of making a living? Topic for class participation after answering the question: How did the birds and squirrels feel as the logger cut down their homes? (There are no wrong answers, and if you feel like crying, it's ok. )

6. Teaching Math In 2010

Un hachero vende una carretada de maderapara $100. El costo de la producciones es $80. Cuanto dinero ha hecho?

GREAT TRUTHS AND A FEW OTHER MAXIMS THAT LIFE TEACHES ONE AND ALL..............

GREAT TRUTHS THAT LITTLE CHILDREN HAVE LEARNED:

1) No matter how hard you try, you can't baptize cats..

2) When your Mom is mad at your Dad, don't let her brush your hair.

3) If your sister hits you, don't hit her back. They always catch the second person.

4) Never ask your 3-year old brother to hold a tomato or egg.

5) You can't trust dogs to watch your food..

6) Don't sneeze when someone is cutting your hair..

7) Never hold a Dust-Buster and a cat at the same time.

8) You can't hide a piece of broccoli in a glass of milk.

9) Don't wear polka-dot underwear under white shorts.

10) The best place to be when you're sad is Grandma's lap.

GREAT TRUTHS THAT ADULTS HAVE LEARNED:

1) Raising teenagers is like nailing jelly to a tree.

2) Wrinkles don't hurt.

3) Families are like fudge...mostly sweet, with a few nuts.

4) Today's mighty oak is just yesterday's nut that held its ground...

5) Laughing is good exercise. It's like jogging on the inside.

6) Middle age is when you choose your cereal for the fiber, not the toy..

GREAT TRUTHS ABOUT GROWING OLD

1) Growing old is mandatory; growing up is optional...

2) Forget the health food. I need all the preservatives I can get.

3) When you fall down, you wonder what else you can do while you're down there.

4) You're getting old when you get the same sensation from a rocking chair that you once got from a roller coaster.

5) It's frustrating when you know all the answers but nobody bothers to ask you the questions...

6) Time may be a great healer, but it's a lousy beautician

7) Wisdom comes with age, but sometimes age comes alone.

THE FOUR STAGES OF LIFE:

1) You believe in Santa Claus.

2) You don't believe in Santa Claus.

3) You are Santa Claus..

4) You look like Santa Claus.

SUCCESS:

At age 4 success is . . . . Not piddling in your pants.

At age 12 success is . . . Having friends.

At age 17 success is . . . .Having a driver's license.

At age 35 success is . . . .Having money.

At age 50 success is . . . Having money..

At age 70 success is . .. . Having a drivers license.

At age 75 success is . .... Having friends.

At age 80 success is . . .. Not piddling in your pants.
 

Watch your thoughts; they become words.

Watch your words; they become actions.

Watch your actions; they become habits..

Watch your habits; they become character.

Watch your character; it becomes your destiny.
 
 

ALWAYS forget the troubles that pass your way;

BUT NEVER forget the blessings that come each day.
 

A SHORT, VERY RELAXING VIDEO CLIP; AWESOME

http://www.andiesisle.com/creation/magnificent.html

SAVE THIS AND USE IT WHEN YOU FEEL STRESSED!

"545 PEOPLE"

"545 PEOPLE"

By Charlie Reese

Politicians are the only people in the world who create problems and then campaign against them..

Have you ever wondered, if both the Democrats and the Republicans are against deficits, WHY do we have deficits?

Have you ever wondered, if all the politicians are against inflation and high taxes, WHY do we have inflation and high taxes?

You and I don't propose a federal budget. The president does.

You and I don't have the Constitutional authority to vote on appropriations. The House of Representatives does.

You and I don't write the tax code, Congress does.

You and I don't set fiscal policy, Congress does.

You and I don't control monetary policy, the Federal Reserve Bank does.

One hundred senators, 435 congressmen, one president, and nine Supreme Court justices equates to 545 human beings out of the 300 million are directly, legally, morally, and individually responsible for the domestic problems that plague this country.

I excluded the members of the Federal Reserve Board because that problem was created by the Congress. In 1913, Congress delegated its Constitutional duty to provide a sound currency to a federally chartered, but private, central bank.

I excluded all the special interests and lobbyists for a sound reason. They have no legal authority They have no ability to coerce a senator, a congressman, or a president to do one cotton-picking thing. I don't care if they offer a politician $1 million dollars in cash. The politician has the power to accept or reject it. No matter what the lobbyist promises, it is the legislator's responsibility to determine how he votes.

Those 545 human beings spend much of their energy convincing you that what they did is not their fault. They cooperate in this common con regardless of party.

What separates a politician from a normal human being is an excessive amount of gall. No normal human being would have the gall of a Speaker, who stood up and criticized the President for creating deficits.... . The president can only propose a budget. He cannot force the Congress to accept it.

The Constitution, which is the supreme law of the land, gives sole responsibility to the House of Representatives for originating and approving appropriations and taxes.

It seems inconceivable to me that a nation of 300 million can not replace 545 people who stand convicted -- by present facts -- of incompetence and irresponsibility. I can't think of a single domestic problem that is not traceable directly to those 545 people. When you fully grasp the plain truth that 545 people exercise the power of the federal government, then it must follow that what exists is what they want to exist.

If the tax code is unfair, it's because they want it unfair.

If the budget is in the red, it's because they want it in the red ..

If the Army & Marines are in IRAQ , it's because they want them in IRAQ. If they do not receive social security but are on an elite retirement plan not available to the people, it's because they want it that way.

There are no insoluble government problems.

Do not let these 545 people shift the blame to bureaucrats, whom they hire and whose jobs they can abolish; to lobbyists, whose gifts and advice they can reject; to regulators, to whom they give the power to regulate and from whom they can take this power. Above all, do not let them con you into the belief that there exists disembodied mystical forces like "the economy," "inflation," or "politics" that prevent them from doing what they take an oath to do.

Those 545 people, and they alone, are responsible.

They, and they alone, have the power..

They, and they alone, should be held accountable by the people who are their bosses.

Provided the voters have the gumption to manage their own employees...

We should vote all of them out of office and clean up their mess!

The Summer Stock Market Rally Is Over.............

The Summer Stock Market Rally Is Over
 
The Jul 1 S&P 500 (SPX) index's intraday low of 1011 up to the August 9th intraday high at 1129, which was near the lower end of the normal retracement range of between one-half and two-thirds of the preceding 17.1% decline from the Apr 26 SPX high at 1220 down to its Jul 1 intraday low at 1011. This initial decline to current levels will now likely be followed by a much larger decline, probably much closer to 30%, if not more.
 
Everybody knows the latest revised annualized real GDP quarterly data shows rapid growth deceleration from Q4's +5.6% to Q1's +3.7% to Q2's + 2.4% - why no reference to "less good" "red shoots"? - but few are currently aware that: (a) Q2's +2.4% was overstated because of a huge miss in nondurable goods inventories: http://blogs.wsj.com/economics/2010/08/03/second-quarter-slowdown-likely-worse-than-first-thought/, and likely lower net foreign trade, which will cause a larger downward revision to be reported on Aug 27.
 
The Great Recession has predictably turned into what could be now called The Great Stall: http://blogs.wsj.com/economics/2010/08/06/economists-react-the-great-stall-takes-hold/ which we expect to turn into what might be called The Great Double-Dip, as calendar-quarter reported GDP growth will probably turn negative by year-end, absolutely stunning permabulls and new bulls alike.
 

Coincident Economic Indicators Also Confirm The End Of The Economic Recovery..........

Coincident Economic Indicators Also Confirm The End Of The Economic Recovery

Notice in the two charts below that the CB's CEI, whose four components track the U.S. economy on a monthly basis, retraced less than 30% of its recessionary decline before stalling out in May, with one component declining June.  This is essentially coincident with the stock market's Apr 26 high and follow-on decline in May and June. This lack of meaningful lead time by the stock market, similar to late 2007 is characteristic of Supercycle Bear Market Periods. This peaking/topping out of data is also accompanied by the May peak in the CB's Leading Economic Index (LEI) (illustrated in the second chart below), partially due to the stock market not leading the business cycle, and the peaks and turns negative during the second half of this year.
All of this simultaneity is fully consistent with a forecast of the imminent onset of the first of the after-shock, double double-dip recessions, investor realization of which will probably lead to our next crisis which will likely end (following a October, 2014 low).
 
 
 

Revised GDP Data...................

Revised GDP Data Shows The Core (Private-Sector) Business Cycle Declined 7.7% During The Seven-Quarter Great Recession And Has Since Only Retraced 18%
 
 
 

Thursday, August 26, 2010

Top Six Reasons Why the Economy Is Going Down...............

Top Six Reasons Why the Economy Is Going Down

A "jobless recovery" in the U.S. is not a recovery.

You can bail out the largest and most mismanaged companies and change the rules to allow banks to forgo reporting their mistakes, making national economic statistics look better. But that doesn't change the reality that millions of people are out of work – since the crash, over six million more in the U.S. alone – and unable to find jobs.

Nor does it make it any less alarming that

the rate of bank failures is well ahead of last year's record (140), with 86 shuttered as of mid-June. Nor does it have the slightest effect on a myriad other harsh realities that politicians, as a group, are unable to face.

 

The EU's massive rescue package has not, and will not, avert trouble in the eurozone.

To the contrary, the situation continues to deteriorate, pressuring the euro ever lower and taking it to levels not seen since early 2006. In today's global economy, what's bad for Europe is bad for Asia and the U.S.

Just as Greece exposed the extent of Europe's problems with the PIIGS,

California seems poised to upset the whole U.S. applecart if it doesn't get bailed out. It would be hard to maintain the illusion of recovery if the most populous state in the U.S. – with a GDP greater than Russia – implodes into a black hole. Illinois, New Jersey, and at least
43 others are just behind, hat in hand.

From Obama's attempted ban on drilling for oil in the Gulf of Mexico, to the new financial regulations Congress has passed, to America's flirtation with socialized medicine, it is clear that the U.S. has entered

a new era of Big Government. Big Government, Big Debt, Big Deficits, Big Military… and surely soon: Big Taxes. One does not have to be an anarcho-libertarian to see this as a Big Problem delivering huge, negative unintended consequences.

The real estate markets are still an unfolding disaster.

May sales of new homes fell by 30% to a record low (seasonally adjusted 300,000 units vs. 800,000 "normal" sales) and dropped another 2.6% in June. Housing starts are down similarly, and previously more rosy stats have been revised downwards. A recent
report from Florida tells us that 81% of all loans in the state are "underwater," and that nearly 40% of all Florida borrowers owe more than 150% of the value of their homes – just another hay bale in the wind. And the commercial real estate debacle we have been warning of has yet to hit the fan.

WE ARE ALL CRUISING ON THE GOOD SHIP TITANIC....

AS THE QUOTE BELLOW CLEARLY POINTS OUT;

POLITICIANS, CAPTAINS OF INDUSTRY, FINANCIAL GURUS, PUNDITS AND SALESMAN OF ALL TYPES AND KINDS HAVE A REASON TO LIE.......

"It is difficult to get a man to understand something when his salary depends on his not understanding it."          

IF NOT IMPOSSIBLE!

                                                                                                                                             Upton Sinclair

WE ARE ALL CRUISING ON THE GOOD SHIP TITANIC....

Since March 2009, the S&P 500 has surged by nearly 60% and US Treasuries have continued to surge, pushing yields close to all-time lows. This has elicited sighs of relief from professional investors, who see the strength as sure signs of recovery.

Yet, these investors are ignoring - willfully or otherwise -- the very thin trading volume upon which this rally is built. Retail investors remain scarred by the '08 collapse and have steered clear of the stock market altogether. Instead, they have parked cash in the Treasury market (hence the low yields).

Still, financial gurus are flush with tales of deep value that await investors who have the fortitude to wade into the market. Don't believe them. This past week, with significant fanfare, even Warren Buffett
Perhaps Buffett is growing increasingly distrustful of a consumer revival, but feels that government support will keep health care from feeling the pinch? While parsing the nuance of Buffet's stance, most American investors are missing the big picture.

For want of a better cliché,
reallocating US stock positions is like rearranging the deck chairs on the Titanic. It would be far wiser to seek passage on a sturdier ship that is sailing with the tide, rather than against it in dangerous waters.

The truth is that despite the cockeyed stance of so called market professionals, over the past five years, the S&P 500 has declined by more than 12%. And these so called professionals are still telling people they will miss out if they don't invest now.

.....AND WE ARE ALL ABOUT TO BUMP INTO A GIGANTIC ICEBERG CALLED THE FALLACY OF A DEBT BASED ECONOMY.

 

OBAMA'S HIDDEN BACKGROUND IS COMING TO LIGHT...........

TWO VERY INTERESTING SOURCES OF INFORMATION TO CONTEMPLATE;
 
FIRST A SHORT VIDEO CLIP;
 
Is Barack Obama Really A Saudi / Muslim "Plant" in the White House?
 
 
 
SECOND, A GREAT RESEARCH ARTICLE ABOUT OBAMA'S BACKGROUND. 
 

Investigative journalist Wayne Madsen is going to reveal his groundbreaking findings on Barack Obama's true origins. Madsen will share these bombshell revelations and the extensive information he found while researching the following three articles.

The Story of Obama: All in The Company

"Tonight is a particular honor for me because, let's face it, my presence on this stage is pretty unlikely. My father was a foreign student, born and raised in a small village in Kenya. He grew up herding goats, went to school in a tin-roof shack. His father — my grandfather — was a cook, a domestic servant to the British. But my grandfather had larger dreams for his son. Through hard work and perseverance my father got a scholarship to study in a magical place, America, that shone as a beacon of freedom and opportunity to so many who had come before."
- Barack Obama,
2004 Democratic National Convention Keynote Address

Far from being the mere 'son of a goat herder' (as he deceptively paraded during and even before his candidacy), strong evidence has emerged that President Barack Obama is the product of the intelligence community. Investigative reporter and former NSA employee Wayne Madsen has put together an extensive three-part (and growing) series with conclusive proof and documentation that Barack Obama Sr., Stanley Ann Dunham, Lolo Soetoro and President Barack Obama himself all hold deep ties to the CIA and larger intelligence community. And that's just the beginning.

After his election, President Obama quickly moved to seal off his records via an executive order. Now, after two years of hints and clues, there is substantial information to demonstrate that what Obama has omitted is that his rare rise to power can only be explained by his intelligence roots. However, this is more than the story of one man or his family. There is a long-term strategic plan to recruit promising candidates into intelligence and steer these individuals and their families into positions of influence and power. Consider that it is now declassified former British Prime Minister Tony Blair was recruited into MI5 before becoming a labour leader, or that George H. W. Bush not only became CIA director in 1976 but had a deeper past in the organization. While we may never know many pertinent details about these matters, one thing that is certain is that the American people have never been told the truth about who holds the real power, nor who this president– and likely many others– really is. Thus, we urge everyone to read Wayne Madsen's deep report and seek the truth for yourself.

——————-

The Story of Obama: All in The Company

(In Three Parts)

Wayne Madsen
August 18, 2010

PART 1: The Story of Obama: All in The Company Investigative journalist Wayne Madsen has discovered CIA files that document the agency's connections to institutions and individuals figuring prominently in the lives of Barack Obama and his mother, father, grandmother, and stepfather. The first part of his report highlights the connections between Barack Obama, Sr. and the CIA-sponsored operations in Kenya to counter rising Soviet and Chinese influence among student circles and, beyond, to create conditions obstructing the emergence of independent African leaders.

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From 1983-84, Barack Obama worked as Editor at Business Internation Corporation, a Business International Corporation, a known CIA front company.

President Obama's own work in 1983 for Business International Corporation, a CIA front that conducted seminars with the world's most powerful leaders and used journalists as agents abroad, dovetails with CIA espionage activities conducted by his mother, Stanley Ann Dunham in 1960s post-coup Indonesia on behalf of a number of CIA front operations, including the East-West Center at the University of Hawaii, the U.S. Agency for International Development (USAID), and the Ford Foundation. Dunham met and married Lolo Soetoro, Obama's stepfather, at the East-West Center in 1965. Soetoro was recalled to Indonesia in 1965 to serve as a senior army officer and assist General Suharto and the CIA in the bloody overthrow of President Sukarno.

Barack Obama, Sr., who met Dunham in 1959 in a Russian language class at the University of Hawaii, had been part of what was described as an airlift of 280 East African students to the United States to attend various colleges — merely "aided" by a grant from the Joseph P. Kennedy Foundation, according to a September 12, 1960, Reuters report from London. The airlift was a CIA operation to train and indoctrinate future agents of influence in Africa, which was becoming a battleground between the United States and the Soviet Union and China for influence among newly-independent and soon-to-be independent countries on the continent.

The airlift was condemned by the deputy leader of the opposition Kenyan African Democratic Union (KADU) as favoring certain tribes — the majority Kikuyus and minority Luos — over other tribes to favor the Kenyan African National Union (KANU), whose leader was Tom Mboya, the Kenyan nationalist and labor leader who selected Obama, Sr. for a scholarship at the University of Hawaii. Obama, Sr., who was already married with an infant son and pregnant wife in Kenya, married Dunham on Maui on February 2, 1961 and was also the university's first African student. Dunham was three month's pregnant with Barack Obama, Jr. at the time of her marriage to Obama, Sr.

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The CIA allegedly recruited Tom M'Boya in a heavily funded "selective liberation" programme to isolate Kenya's founding President Jomo Kenyatta, who the American spy agency labelled as "unsafe."

KADU deputy leader Masinda Muliro, according to Reuters, said KADU would send a delegation to the United States to investigate Kenyan students who received "gifts" from the Americans and "ensure that further gifts to Kenyan students are administered by people genuinely interested in Kenya's development.'"

Mboya received a $100,000 grant for the airlift from the Kennedy Foundation after he turned down the same offer from the U.S. State Department, obviously concerned that direct U.S. assistance would look suspicious to pro-Communist Kenyan politicians who suspected Mboya of having CIA ties. The Airlift Africa project was underwritten by the Kennedy Foundation and the African-American Students Foundation. Obama, Sr. was not on the first airlift but a subsequent one. The airlift, organized by Mboya in 1959, included students from Kenya, Uganda, Tanganyika, Zanzibar, Northern Rhodesia, Southern Rhodesia, and Nyasaland.

Reuters also reported that Muliro charged that Africans were "disturbed and embittered" by the airlift of the selected students. Muliro "stated that "preferences were shown to two major tribes [Kikuyu and Luo] and many U.S.-bound students had failed preliminary and common entrance examinations, while some of those left behind held first-class certificates."

Obama, Sr. was a friend of Mboya and a fellow Luo. After Mboya was assassinated in 1969, Obama, Sr. testified at the trial of his alleged assassin. Obama, Sr. claimed he was the target of a hit-and-run assassination attempt after his testimony.

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CIA-airlifted to Hawaii, Barack Obama Sr., with leis, stands with Stanley Dunham, President Obama's grandfather, on his right.

Obama, Sr., who left Hawaii for Harvard in 1962, divorced Dunham in 1964. Obama, Sr. married a fellow Harvard student, Ruth Niedesand, a Jewish-American woman, who moved with him to Kenya and had two sons. They were later divorced. Obama, Sr. worked for the Kenyan Finance and Transport ministries as well as an oil firm. Obama, Sr. died in a 1982 car crash and his funeral was attended by leading Kenyan politicians, including future Foreign Minister Robert Ouko, who was murdered in 1990.

CIA files indicate that Mboya was an important agent-of-influence for the CIA, not only in Kenya but in all of Africa. A formerly Secret CIA Current Intelligence Weekly Summary, dated November 19, 1959, states that Mboya served as a check on extremists at the second All-African People's Conference (AAPC) in Tunis. The report states that "serious friction developed between Ghana's Prime Minister Kwame Nkrumah and Kenyan nationalist Tom Mboya who cooperated effectively last December to check extremists at the AAPC's first meeting in Accra." The term "cooperated effectively" appears to indicate that Mboya was cooperating with the CIA, which filed the report from field operatives in Accra and Tunis. While "cooperating" with the CIA in Accra and Tunis, Mboya selected the father of the president of the United States to receive a scholarship and be airlifted to the University of Hawaii where he met and married President Obama's mother.

An earlier CIA Current Intelligence Weekly Summary, secret, and dated April 3, 1958, states that Mboya "still appears to be the most promising of the African leaders." Another CIA weekly summary, secret and dated December 18, 1958, calls Mboya the Kenyan nationalist an "able and dynamic young chairman" of the People's Convention party who was viewed as an opponent of "extremists" like Nkrumah, supported by "Sino-Soviet representatives."

In a formerly Secret CIA report on the All-Africa Peoples Conference in 1961, dated November 1, 1961, Mboya's conservatism, along with that of Taleb Slim of Tunisia, are contrasted to the leftist policies of Nkrumah and others. Pro-communists who were elected to the AAPC's steering committee at the March 1961 Cairo conference, attended by Mboya, are identified in the report as Abdoulaye Diallo, AAPC Secretary General, of Senegal; Ahmed Bourmendjel of Algeria; Mario de Andrade of Angola; Ntau Mokhele of Basutoland; Kingue Abel of Cameroun; Antoine Kiwewa of Congo (Leopoldville); Kojo Botsio of Ghana; Ismail Toure of Guinea; T. O. Dosomu Johnson of Liberia; Modibo Diallo of Mali; Mahjoub Ben Seddik of Morocco; Djibo Bakari of Niger; Tunji Otegbeya of Nigeria; Kanyama Chiume of Nyasaland; Ali Abdullahi of Somalia; Tennyson Makiwane of South Africa, and Mohamed Fouad Galal of the United Arab Republic.

The only attendees in Cairo who were given a clean bill of health by the CIA were Mboya, who appears to have been a snitch for the agency, and Joshua Nkomo of Southern Rhodesia, B. Munanka of Tanganyika, Abdel Magid Shaker of Tunisia, and John Kakonge of Uganda.

Nkrumah would eventually be overthrown in a 1966 CIA-backed coup while he was on a state visit to China and North Vietnam. The CIA overthrow of Nkrumah followed by one year the agency's overthrow of Sukarno, another coup that was connected to President Obama's family on his mother's side. There are suspicions that Mboya was assassinated in 1969 by Chinese agents working with anti-Mboya factions in the government of Kenyan President Jomo Kenyatta in order to eliminate a pro-U.S. leading political leader in Africa. Upon Mboya's death, every embassy in Nairobi flew its flag at half-mast except for one, the embassy of the People's Republic of China.

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Jomo Kenyatta, first President of Kenya.

Mboya's influence in the Kenyatta government would continue long after his death and while Obama, Sr. was still alive. In 1975, after the assassination of KANU politician Josiah Kariuki, a socialist who helped start KANU, along with Mboya and Obama, Sr., Kenyatta dismissed three rebellious cabinet ministers who "all had personal ties to either Kariuki or Tom Mboya." This information is contained in CIA Staff Notes on the Middle East, Africa, and South Asia, formerly Top Secret Umbra, Handle via COMINT Channels, dated June 24, 1975. The intelligence in the report, based on its classification, indicate the information was derived from National Security Agency intercepts in Kenya. No one was ever charged in the assassination of Kariuki.

The intecepts of Mboya's and Kariuki's associates are an indication that the NSA and CIA also maintain intercepts on Barack Obama, Sr., who, as a non-U.S. person, would have been lawfully subject at the time to intercepts carried out by NSA and Britain's Government Communications Headquarters (GCHQ).

(Continued below)

PART 2: Special Report. The Story of Obama: All in The Company

In Part I of this report, we revealed the connections between Barack Obama, Sr. and the CIA-affiliated Airlift Africa project to provide college degrees to and gain influence over a group of 280 eastern and southern African students from soon-to-be independent African nations to counter similar programs established by the Soviet Union and China. Barack Obama Sr. was the first African student to attend the University of Hawaii. Obama Sr. and Obama's mother Stanley Ann Dunham met in a Russian language class in 1959 and they married in 1961.

The African airlift program was administered by Kenyan nationalist leader Tom Mboya, a fellow Luo tribe mentor and friend of the senior Obama. According to CIA documents described in Part I, Mboya also served the CIA in ensuring that pro-Soviet and pro-Chinese African nationalists were stymied in their attempt to dominate pan-African nationalist political, student, and labor movements.

One of Mboya's chief opponents was Ghana's first president, Kwame Nkrumah, who was ousted in a CIA-inspired coup in 1966, one year before to Obama Sr's son, Barack Obama, Jr. and his mother joined Lolo Soetoro, an Indonesian who Obama's mother met at the University of Hawaii in 1965, when President Obama was four years old.

In 1967, Obama and his mother joined her husband in Jakarta. In 1965, Lolo Soetoro had been called back from Hawaii by General Suharto to serve as an officer in the Indonesian military to help launch a bloody CIA-backed genocide of Indonesian Communists and Indonesian Chinese throughout the expansive country. Suharto consolidated his power in 1966, the same year that Barack Obama, Sr.'s friend, Mboya, had helped to rally pro-U.S. pan-African support for the CIA's overthrow of Nkrumah in Ghana in 1966.

East-West Center, University of Hawaii,  and CIA coup against Sukarno

Ann Dunham met Soetoro at the East-West Center at the University of Hawaii. The center had long been affiliated with CIA activities in the Asia-Pacific region. In 1965, the year that Dunham met and married Soetoro, the center saw a new chancellor take over. He was Howard P. Jones who served a record seven years, from 1958 to 1965, as U.S. ambassador to Indonesia. Jones was present in Jakarta as Suharto and his CIA-backed military officers planned the 1965 overthrow of Sukarno, who was seen, along with the Indonesian Communist Party (PKI), as allies of China.

When Jones was chancellor of the East-West Center, he wrote an article for the Washington Post, dated October 10, 1965, in which he defended Suharto's overthrow of Sukarno. Jones was "invited" by the Post to comment on the Suharto coup, described as a "counter-coup" against the Communists. Jones charged that Suharto was merely responding to an earlier attempted Communist-led coup against Sukarno launched by Lt. Col. Untung, "a relatively unknown battalion commander in the palace guard."

Jones's article, which mirrored CIA situation reports from the U.S. embassy in Jakarta, continued by stating that the alleged leftist coup on September 30 "came within an inch of succeeding through the assassination of six of the top military command. It might well have succeeded had not Defense Minister Nasution and a number of other senior generals also maked for assassination acted fast in a dramatic counter-coup." Of course, what Jones did not inform the Post's readers was that the Suharto "counter-coup" had been assisted with the strong help of the CIA.

Sukarno never blamed the Communists for the assassination of the army generals nor did the Indonesian Cabinet, where the second= and third-ranking leaders of the PKI were present. The possibility that the assassination of the generals was a CIA/Suharto "false flag" operation to affix blame on the PKI cannot be ruled out. Two days after Suharto's coup, a CIA "rent-a-mob" burned down the PKI headquarters in Jakarta. As they marched past the U.S. Embassy, which was also the site of the CIA station, they yelled out, "Long live America!"

Untung later said that when he became aware that Suharto and the CIA were planning a coup on October 5, 1965 – Indonesian Armed Forces Day – forces loyal to him and Sukarno moved first. Jones described this as "typical Communist propaganda." Suharto moved against Sukarno on October 1. Jones iterated that "there was not an iota of truth . . . in the accusation that the CIA was working against Sukarno." History has proven otherwise. Jones accused the Communists of taking advantage of Sukarno's failing health to beat out the other candidates to succeed him. The goal, according to Jones, was to have PKI boss D.N. Aidit succeed Sukarno. Sukarno did not die until 1970, while under house arrest.

A CIA paper, formerly classified Secret and undated, states "Sukarno would like to return to the status quo ante-coup. He has refused to condemn the PKI or the 30th September Movement [of Lt. Col. Untung]; instead, he calls for unity of Indonesia and asks that no vengeance be taken by one group against the other. But, he has not succeeded in forcing the Army to abandon its anti-PKI activities and, on the other hand, he has bowed to their demand by appointing its single candidate General Suharto as head of the Army." Suharto and Barry Obama Soetoro's step-father Lolo Soetoro would ignore Sukarno's call for no vengeance, as hundreds of thousands of Indonesians would soon discover.

The mass murder by Suharto of Indonesian Chinese is seen in the CIA paper's description of the Baperki Party: "the leftist Baperki Party, with its major strength in rural areas, is largely Chinese-Indonesian in membership." A CIA Intelligence Memorandum, dated October 6, 1966 and formerly classified Secret, shows the extent of the CIA's monitoring of the anti-Sukarno coup from various CIA agents assigned as liaisons to Suharto's army units surrounding the Presidential Palace in Bogor and at various diplomatic posts around the country, including the U.S. Consulate in Medan, which was keeping track of leftists in that Sumatran city and, which, in an October 2, 1965, Intelligence Memo, reported to the CIA that the "Soviet consul-general in Medan has a plane standing by that could be used for evacuation of Soviet citizens from Sumatra." The October 6 memo also warns against allowing Untung from developing a following in Central Java.

A CIA formerly Secret "Weekly Summary Special Report" on Indonesia, dated August 11, 1967, and titled "The New Order in Indonesia," reports that in 1966, Indonesia re-aligned its economy in order to receive International Monetary Fund (IMF) assistance. The CIA reports its is happy with the new triumvirate ruling Indonesia in 1967: Suharto, Foreign Minister Adam Malik, and the Sultan of Jogjakarta, who served as minister for economics and finance. The report also rejoices in the outlawing of the PKI, but states it "retains a significant following in East and Central Java," where Ann Dunham Soetoro would largely concentrate her later efforts on behalf of USAID, the World Bank, and the Ford Foundation, all front activities for the CIA to "win the hearts and minds" of the Javanese farmers and artisans.

A CIA Intelligence Memorandum, formerly Secret and dated July 23, 1966, clearly sees the Muslim Nahdatul Ulama party {NU), the largest party in Indonesia and Muslim, as a natural ally of the United States and the Suharto regime. The report states that helped Suharto put down the Communists in the post-coup time frame, especially where the NU was strongest: East Java, where Obama's mother would concentrate her activities, and North Sumatra and parts of Borneo. An April 29, 1966, formerly Secret CIA Intelligence Memorandum on the PKI states: "Moslem extremists in many instances outdid the army in hunting down and murdering members of the party [PKI] and its front groups."

Dunham and Barry Soetoro in Jakarta and USAID front activities

Dunham dropped out of the University of Hawaii in 1960 while pregnant with Barack Obama. Barack Obama Sr. left Hawaii in 1962 to study at Harvard. Dunham and Obama divorced in 1964. In the fall of 1961, Dunham enrolled at the University of Washington while caring for her infant son. Dunham was re-enrolled at the University of Hawaii from 1963 to 1966. Lolo Soetoro, who Dunham married in March 1965, departed Hawaii for Indonesia on July 20, 1965, some three months prior to the CIA's coup against Sukarno. Soetoro, who served Suharto as an Army colonel, was clearly called back from the CIA-connected East-West Center to assist in the coup against Sukarno, one that would eventually cost the lives of some one million Indonesian citizens. It is a history that President Obama would like the press to ignore, which it certainly did during the 2008 primary and general election.

In 1967, after arriving in Indonesia with Obama, Jr., Dunham began teaching English at the American embassy in Jakarta, which also housed one of the largest CIA stations in Asia and had significant satellite stations in Surabaya in eastern Java and Medan on Sumatra. Jones left as East-West Center chancellor in 1968.

In fact, Obama's mother was teaching English for the U.S. Agency for International Development (USAID), which was a major cover for CIA activities in Indonesia and throughout Southeast Asia, especially in Laos, South Vietnam, and Thailand. The USAID program was known as Lembaga Pendidikan Pembinaan Manajemen. Obama's mother, painted as a free spirit and a "sixties child" by President Obama and people who claimed they knew her in Hawaii and Indonesia, had a curriculum vitae in Indonesia that contradicts the perception that Ann Dunham Soetoro was a "hippy."

Dunham Soetoro's Russian language training at the University of Hawaii may have been useful to the CIA in Indonesia. An August 2, 1966, formerly Secret memorandum from the National Security Council's Executive Secretary Bromley Smith states that, in addition to Japan, Western Europe, Australia, New Zealand, Malaysia, and the Philippines, the Suharto coup was welcomed by the Soviet Union and its Eastern European allies because its created a non-aligned Indonesia that "represents an Asian counterweight to Communist China." Records indicate that a number of CIA agents posted in Jakarta before and after the 1965 coup were, like Dunham Soetoro, conversant in Russian.

Dunham Soetoro worked for the elitist Ford Foundation, World Bank, Asian Development Bank, Bank Rakyat (the majority government-owned People's Bank of Indonesia), and the CIA-linked USAID while she lived in Indonesia and later, Pakistan.

USAID was involved in a number of CIA covert operations in Southeast Asia. The February 9, 1971, Washington Star reported that USAID officials in Laos were aware that rice supplied to the Laotian Army by USAID was being re-sold to North Vietnamese army divisions in the country. The report stated that the U.S. tolerated the USAID rice sales to the North Vietnamese since the Laotian Army units that sold the rice found themselves protected from Communist Pathet Lao and North Vietnamese attack. USAID and the CIA also used the supply of rice to force Laotian Meo tribesmen to support the United States in the war against the Communists. USAID funds programmed for civilians injured in the war in Laos and public health care were actually diverted for military purposes.

In 1971, the USAID-funded Center for Vietnamese Studies at Southern Illinois University in Carbondale was accused of being a CIA front. USAID-funded projects through the Midwest Universities Consortium for International Activities (MUCIA) — comprising the Universities of Illinois, Wisconsin, Minnesota, Indiana and Michigan State — were accused of being CIA front projects, including those for "agricultural education" in Indonesia, as well as other "projects" in Afghanistan, Mali, Nepal, Nigeria, Thailand, and South Vietnam. The charge was made in 1971, the same year that Ann Dunham was working for USAID in the country.

In a July 10, 1971, New York Times report, USAID and the CIA were accused of "losing" $1.7 billion appropriated for the Civil Operations and Revolutionary Development Support (CORDS) program in South Vietnam. CORDS was part of the CIA's Operation Phoenix program, which involved CIA assassination and torture of South Vietnamese village elders and Buddhist clerics. USAID money was also directed to the CIA's proprietary airline in Southeast Asia, Air America. In Thailand, USAID funds for the Accelerated Rural Development Program in Thailand were actually masking a CIA anti-Communist counter-insurgency operation. USAID funds programmed for public works projects in East Pakistan in 1971 were used for East Pakistan's military fortifications on its border with India, in the months before the outbreak of war with India, in contravention of U.S. law that prohibited USAID money for military purposes.

In 1972, USAID administrator Dr. John Hannah admitted to Metromedia News that USAID was being used as a cover for CIA covert operations in Laos. Hannah only admitted to Laos as a USAID cover for the CIA. However, it was also reported that USAID was being used by the CIA in Indonesia, Philippines, South Vietnam, Thailand, and South Korea. USAID projects in Southeast Asia had to be approved by the Southeast Asian Development Advisory Group (SEADAG), an Asia Society group that was, in fact, answerable to the CIA.

The U.S. Food for Peace program, jointly administered by USAID and the Department of Agriculture, was found in 1972 to be used for military purposes in Cambodia, South Korea, Turkey, South Vietnam, Spain, Taiwan, and Greece. In 1972, USAID funneled aid money only to the southern part of North Yemen, in order to aid North Yemeni forces against the government of South Yemen, then ruled by a socialist government opposed to U.S. hegemony in the region.

One of the entities affiliated with the USAID work in Indonesia was the Asia Foundation, a 1950s creation formed with the help of the CIA to oppose the expansion of communism in Asia. The East-West Center guest house in Hawaii was funded by the Asia Foundation. The guest house is also where Barack Obama Sr. first stayed after his airlift from Kenya to Hawaii, arranged by the one of the CIA's major agents of influence in Africa, Mboya.

Dunham would also travel to Ghana, Nepal, Bangladesh, India, and Thailand working on micro-financing projects. In 1965, Barack Obama Sr. returned to Kenya from Harvard, with another American wife. The senior Obama linked up with his old friend and the CIA's "golden boy" Mboya and other fellow Luo politicians. The CIA station chief in Nairobi from 1964 to 1967 was Philip Cherry. In 1975, Cherry was the CIA station chief in Dacca, Bangladesh. Cherry was linked by the then-U.S. ambassador to Bangladesh, Eugene Booster, to the 1975 assassination of Bangladesh's first president, Sheikh Mujibur Rahman, and members of his family.

The hit on "Sheikh Mujib" and his family was reportedly ordered by then-Secretary of State Henry Kissinger. Bangladesh was also on the micro- and macro-financing travel itinerary of CIA-linked Ann Dunham.

CIA banking and Hawaii

Meanwhile, Dunham Soetoro's mother, Madelyn Dunham, who raised young Obama when he returned to Hawaii in 1971 while his mother stayed in Indonesia, was the first female vice president at the Bank of Hawaii in Honolulu. Various CIA front entities used the bank. Madelyn Dunham handled escrow accounts used to make CIA payments to U.S.-supported Asian dictators like Philippines President Ferdinand Marcos, South Vietnamese President Nguyen van Thieu, and President Suharto in Indonesia. In effect, the bank was engaged in money laundering for the CIA to covertly prop up its favored leaders in the Asia-Pacific region.

One of the CIA's major money laundering fronts in Honolulu was the firm of Bishop, Baldwin, Rewald, Dillingham & Wong (BBRDW). After the CIA allowed the firm to collapse in 1983  amid charges that BBRDW was merely a Ponzi scheme, Senator Daniel Inouye of the US Senate Intelligence Committee said the CIA's role in the firm "wasn't significant." It would later be revealed that Inouye, who was one of the late Alaska Senator Ted Stevens's best friends in the Senate, was lying. In fact, BBRDW was involved heavily in funding covert CIA programs throughout Asia, including economic espionage against Japan, providing arms for Afghan mujaheddin guerrillas in their war against the Soviets and covertly supplying weapons to Taiwan. One of BBRDW's principals was John C. "Jack" Kindschi, who, before he retired in 1981, was the CIA station chief in Honolulu. BBRDW's chairman Ron Rewald had a counterfeit college degree certificate provided for the wall of his office by the CIA's forgery experts and his name was inserted in university records as an alumnus.

A false history for BBRDW was concocted by the CIA claiming the firm had operated in Hawaii since it was a territory. President Obama is currently plagued by allegations that he has fake college and university transcripts, a phony social security number issued in Connecticut, and other padded resume items. Did Hawaii's fake BBRDW documents portend today's questions about Obama's past?

BBRDW conducted its business in the heart of Honolulu's business district, where the Bank of Hawaii was located and where Obama grandmother Madelyn Dunham ran the escrow accounts. The bank would handle much of BBRDW's covert financial transactions.

Obama/Soetoro and the "years of living dangerously" in Jakarta

It is clear that Dunham Soetoro and her Indonesian husband, President Obama's step-father, were closely involved in the CIA's operations to steer Indonesia away from the Sino-Soviet orbit during the "years of living dangerously" after the overthrow of Sukarno. WMR has discovered that some of the CIA's top case officers were assigned to various official and non-official cover assignments in Indonesia during this time frame, including under the cover of USAID, the Peace Corps, and the U.S. Information Agency (USIA).

One of the closest CIA contacts for Suharto was former CIA Jakarta embassy officer Kent B. Crane. Crane was so close to Suharto after "retiring" from the CIA, he was reportedly one of the only "private" businessmen given an Indonesian diplomatic passport by Suharto's government. Crane's company, the Crane Group, was involved in supplying small arms to the military forces of the United States, Indonesia, and other nations. A foreign policy adviser to Vice President Spiro Agnew, Crane was later nominated as U.S. ambassador to Indonesia by President Ronald Reagan but the nomination was dead-on-arrival because of Crane's dubious links to Suharto. The ambassadorship would instead go to John Holdridge, a close colleague of Kissinger. Holdridge was succeeded in Jakarta by Paul Wolfowitz.

Suharto's cronies, who included Mochtar and James Riady of the Lippo Group, would later stand accused of funneling over $1 million of illegal foreign contributions to Bill Clinton's 1992 presidential campaign.

President Obama has twice postponed official state visits to Indonesia, perhaps fearful of the attention such a trip would bring to the CIA connections of his mother and Indonesian step-father.

In the 1970s and 80s, Dunham was active in micro-loan projects for the Ford Foundation,  the CIA-linked East-West Center, and USAID in Indonesia. One of the individuals assigned to the U.S. embassy and helped barricade the compound during a violent anti-U.S. student demonstration during the 1965 Suharto coup against Sukarno was Dr. Gordon Donald, Jr. Assigned to the embassy's Economic Section, Donald was responsible for USAID micro-financing for Indonesian farmers, the same project that Dunham Soetoro would work on for USAID in the 1970s, after her USAID job of teaching English in Indonesia. In a 1968 book, "Who's Who in the CIA," published in West Berlin, Donald is identified as a CIA officer who was also assigned to Lahore, Pakistan, where Dunham would eventually live for five years in the Hilton International Hotel while working on microfinancing for the Asian Development Bank.

Another "Who's Who in the CIA" Jakarta alumnus is Robert F. Grealy, who later became the director for international relations for the Asia-Pacific for J P Morgan Chase and a director for the American-Indonesian Chamber of Commerce. J P Morgan Chase's CEO Jamie Dimon is being mentioned as a potential replacement for Treasury Secretary Timothy Geithner, whose father, Peter Geithner, was the Ford Foundation's Asia grant-selector who funneled the money to Ann Dunham's Indonesian projects.

CIA Black Projects and Hawaii

While in Pakistan, Dunham's son Barack visited her in 1980 and 1981. Obama visited Karachi, Lahore, and Hyderabad, India during his south Asia visits. It was during the time period that the CIA was beefing up its anti-Soviet operations in Afghanistan from Pakistan.

A January 31, 1958, heavily-redacted formerly Secret NOFORN [no foreign dissemination] memorandum for CIA Director Allen Dulles from the Deputy Assistant Director of the CIA for Research and Reports [name redacted] reports on a fact-finding mission to the Far East, Southeast Asia, and the Middle East from November 17 through December 21, 1957.

The CIA Office of Research and Reports (ORR) chief reports a meeting with the staff of retired Army General Jesmond Balmer, a senior CIA official in Hawaii, about requests by the Commander-in-Chief Pacific (CINCPAC) for "a number of detailed, time-consuming research studies." The ORR chief then reports about a CIA "survey of students at the University of Hawaii who have both Chinese language and research ability." The ORR chief also reports that at a South-East Asia Treaty Organization (SEATO) Counter Subversion Seminar at Baguio, Philippines held from November 26-29, 1957, the Economic Subcommittee discussed an "economic development fund" to combat "Sino-Soviet Bloc subversive activities in the area and a consideration of possible counter-measures which might be employed."

The Thailand and Philippines delegations were pushing hard for U.S. funding for an economic development fund, which may have provided the impetus for later USAID projects in the region, including those with which Peter Geithner and Obama's mother were intimately involved.

Although CIA geo-political covert operations at the University of Hawaii are well-documented, the agency's darker side of research and MK-UKTRA type operations has not generally been associated with the University of Hawaii.

A series of formerly Confidential CIA memoranda, dated May 15, 1972, points to the involvement of both the Defense Department's Advanced Research Projects Agency (ARPA), the CIA, and the University of Hawaii in the CIA's behavioral science program. The memos are signed by then-Deputy Director of the CIA Bronson Tweedy, the chief of the Intelligence Community's Program Review Group (PRG) [name redacted], and CIA Director Richard Helms. The subject of the memos is "ARPA Supported Research Relating to Intelligence Product," The memo from the PRG chief discusses a conference held on May 11, 1972, attended by Lt. Col. Austin Kibler, ARPA's Director of Behavioral Research. Kibler was the chief for ARPA research into behavior modification and remote viewing. Others mentioned in the PRG chief's memo include CIA Deputy Director for Intelligence Edward Proctor, the CIA Deputy Director for Science and Technology Carl Duckett, and Director of the Office of National Estimates John Huizenga.

In 1973, after CIA Director James Schlesinger ordered a review of all CIA programs, the CIA developed a set of documents on various CIA programs collectively called the "Family Jewels." Most of these documents were released in 2007 but it was also revealed that Dr. Sidney Gottlieb, the CIA's director of MKULTRA, the agency's behavior modification, brainwashing, and drug testing component, had been ordered by Helms, before he resigned as CIA director, to be destroyed. Duckett, in one memo from Ben Evans of the CIA to CIA Director William Colby, dated May 8, 1973, conveys that he "thinks the Director would be ill-advised to say he is acquainted with this program," meaning Gottlieb's drug testing program under MKULKTRA.

Senior Gerald Ford administration officials, including Chief of Staff Dick Cheney and Defense Secretary Donald Rumsfeld, ensured that after the production of the "Family Jewels" documents, no CIA revelations were made about CIA psychological behavior-altering programs, including MKULTRA and Project ARTICHOKE.

The May 15, 1972, set of memos appears to be related to the CIA's initial research, code named SCANATE, in 1972 into psychic warfare, including the use of psychics for purposes of remote viewing espionage and mind control. The memo discussed Kibler from ARPA and "his contractor," which was later discovered to be Stanford Research Institute (SRI) in Menlo Park, California.

In a memo from CIA Director Helms to, among others, Duckett, Huizenga, Proctor, and the Director of the Defense Intelligence Agency, which later inherited reote viewing from the CIA under the code name GRILL FLAME, Helms insists that ARPA had been supporting research into behavioral science and its potential for intelligence production "for a number of years" at "M.I.T., Yale, the University of Michigan, U.C.L.A., and University of Hawaii and other institutions as well as in corporate research facilities."

The role of the University of Hawaii in CIA psych-war operations continues to this day.  The chief of research for DIA's Defense Counterintelligence and Human Intelligence Center (DCHC) Behavioral Sciences Program, Dr. Susan Brandon, who was reportedly involved in a covert program run by the American Psychological Association (APA), Rand Corporation, and the CIA to employ "enhanced interrogation" techniques, including sleep and sensory deprivation, intense pain, and extreme isolation on prisoners held at Bagram airbase in Afghanistan and other "black prisons," received her PhD in Psychology from the University of Hawaii. Brandon also served as assistant director of Social, Behavioral, and Educational Sciences for the Office of Science and Technology Policy in the George W. Bush White House.

The CIA's close connections to the University of Hawaii continued to the late 1970s, when the former President of the University of Hawaii from 1969 to 1974, Harlan Cleveland, was a special invited speaker at CIA headquarters on May 10, 1977. Cleveland served as Assistant Secretary of State for International Organization Affairs from 1961 to 1965 and Lyndon Johnson's ambassador to NATO from 1965 to 1969 before taking up his position at the University of Hawaii.

A CIA Director of Training memo dated May 21, 1971, reports on the active recruitment of a U.S. Marine officer who was entering graduate school at the University of Hawaii.

The Family of Obama and the CIA

There are volumes of written material on the CIA backgrounds of George H. W. Bush and CIA-related activities by his father and children, including former President George W. Bush. Barack Obama, on the other hand, cleverly masked his own CIA connections as well as those of his mother, father, step-father, and grandmother (there is very little known about Obama's grandfather, Stanley Armour Dunham, who was supposedly in the furniture business in Hawaii after serving in Europe during World War II). Presidents and vice presidents do not require security background checks, unlike other members of the federal government, to hold office. That job is left up to the press. In 2008, the press failed miserably in its duty to vet the man who would win the White House. With the ties of Obama's parents to the University of Hawaii and its links to MKULTRA and ARTICHOKE, a nagging question remains: Is Barack Obama a real-life "Manchurian Candidate?"

PART 3: August 19, 2010 — SPECIAL REPORT. The Story of Obama: All in the Company — Add one more Obama family member to the CIA payroll.

WMR previously reported on the CIA links of President Obama's mother, father, step-father, grandmother to the CIA. Not much is known about Obama's grandfather, Stanley Armour Dunham, who Obama mistakenly referred to as "his father" in two speeches, one recently to the Disabled American Veterans.

What is officially known about Stanley Armour Dunham is that he served with the 9th Air Force in Britain and France prior to and after the D-Day invasion. After the war, Dunham and his wife, Madelyn and his daughter Stanley Ann — Obama's mother — moved to Berkeley, California; El Dorado, Kansas; Seattle; and Honolulu. Armour Dunham is said to have worked for a series of furniture stores.

Obama maintains that his mother and father first met in a Russian-language class at the University of Hawaii in 1959. However, a photograph has emerged of Stanley Armour welcoming Barack Obama, Sr., complete with traditional Hawaiian welcoming leis, from Kenya. Obama, Sr. was the only Kenyan student airlifted to Hawaii as part of the CIA-inspired Airlift Africa project that saw Obama and 279 other students from British eastern and southern African colonies brought to the United States for college degrees prior to their homelands gaining independence from Britain. The students were selected by Kenyan nationalist leader Tom Mboya who would later conduct surveillance for the CIA at pan-African nationalist meetings. Mboya was particularly focused on two African leaders who were seen as too close to the Sino-Soviet bloc, Kwame Nkrumah of Ghana and Sekout Toure of Guinea.

Stanley Armour Dunham with Barack Obama, Sr. at welcoming ceremony to Hawaii. The presence of two US Navy personnel indicates the plane may have landed at Hickam Air Force Base, an indication of the U.S. government's and CIA's role in the Airlift Africa project.

The photograph of Armour Dunham with Barack Obama, Sr., indicates that the "furniture salesman" in Hawaii was, in fact, working with a CIA-funded project to rapidly educate aspiring politicians to serve in post-independence African governments to counter Soviet- and Chinese-backed political leaders in the region.

There is a strong reason to believe that Armour Dunham worked in the 1950s for the CIA in the Middle East. An FBI file on Armour Dunham existed but the bureau claimed it destroyed the file on May 1, 1997. Considering the sour relations between the FBI and CIA during the Cold War, it is likely that Armour Dunham was being monitored by FBI director J. Edgar Hoover in the same manner as a number of other CIA officials and agents were being surveilled. Similarly, the pre-1968 passport records of Obama's mother, Stanley Ann Dunham, were destroyed by the State Department.

There is a photographic clue that the Dunhams may have been assigned by the CIA to Beirut, Lebanon in the early 1950s. A photograph of Obama's mother and grandparents has emerged that shows Stanley Ann Dunham wearing what may be a school uniform with the insignia of "NdJ," which stands for the College Notre-Dame de Jamhour, a private Jesuit Catholic French language school in Beirut, Lebanon. Graduates of the school include three former presidents of Lebanon, Amine Gemayel, Bashir Gemayel, and Charles Helou, all of whom maintained close relations with Washington.

Did Obama's mother [left] go to a private school in Lebanon in the early 1950s while her father [middle] worked for the CIA in Beirut?

There is also the curious nature of President Obama's Social Security Number, issued in Connecticut, a state where there is no other evidence of his ever being a resident. Adding to the mystery is a New York City address for a "male" named Stanley Ann Dunham,  235 E. 40th St Apt 8F, New York NY 10016-1747. The address is a few blocks away from the address of the Ford Foundation. Ann Dunham did work briefly in New York for the Ford Foundation.

On August 9, 2010, WMR reported, "In a December 19, 1971, article in the Boston Globe by Dan Pinck, [a historian and former OSS officer] titled 'Is everyone in the CIA?' it is alleged that identifying US Agency for International Development (USAID) officers as CIA agents was a 'reasonably accurate accounting of certain leading operatives and associates of the CIA.' President Obama's mother, Stanley Ann Dunham Soetoro worked for USAID in rural Java in Indonesia. Pinck's article was a review of a 1968 book, 'Who's Who in the CIA' published in Berlin."

WMR has obtained a rare copy of "Who's Who in the CIA," from England. The book, published in West Berlin in 1968, lists some 3,000 CIA agents and agents-of-influence around the world.

The book also contains a reference to one CIA operative whose area of primary place of operation was Mercer Island, Washington. He was retired Air Force General Don Zabriskie Zimmermann, who was the Chief Engineer for the Boeing Company in Seattle. Before retiring from the Air Force, Zimmermann was the Air Force Assistant Deputy Chief of Staff for Development in Foreign Countries. Ann Stanley Dunham reportedly graduated from Mercer Island High School in 1960 and met Obama later that year in a Russian language class after  her parents moved to Hawaii. Stanley Ann's mother, Madelyn Dunham, worked at a Boeing plant in Wichita, Kansas during World War II.

The book lists the number of CIA agents in countries during the 1950s and 60s where Obama's father, mother, step-father Lolo Soetori, and allegedly, his grandmother and grandfather worked:

Indonesia  

Jakarta   64

Surabaya  12

Medan  8

Hollandia  1

Kenya

Nairobi  19

Mombassa  2

Lebanon

Beirut  61     (including one agent also assigned to Jakarta, Lahore, and Karachi and another assigned to Lahore)

Hawaii

Honolulu   6  (one agent also assigned to Canton Island and another was fluent in French, Stanley Ann Dunham spoke French, Urdu, Bahasa Indonesian, and she studied Javanese at the University of Hawaii, in addition to Russian).