Monday, July 23, 2012

When Economic Growth Looks Like a Recession

For the past five years I have been writing about the perspective of factors that may drag down the US economy to near ruin, here, here, here, here, and here are just a few. All based on knowledge of the current parameters of the global economy. In simple term, data suggest that like the global system, the US financial system is severely top heavy with debt and our economy is dragging, stagnate and getting worse with each passing day. The sad thing is that the US government seems not to be telling the truth and wants to paint a rosy picture of all is getting better.  But no matter what they are saying and no matter what the Federal Reserve Bank does, it won’t be enough to put Humpty back together again, or be able to avoid another major economic downturn. And even sadder is that these issues persist no matter which political party is in power.

My reason for thinking this has nothing to do with likes or dislikes of Obama or the GOP, or my purview of the Federal reserve, but rather that the specter of a tenable future of a "hyperinflationary depression” is real for the US Economy. Mine is the sort of logic that is more like mathematics or chess, and presented merely to explain what I mean.

Just last week, the associate Press, based on census figures for 2009 reported that the number of folk living in poverty, under President Obama’s leadership is approaching 1960s levels.  Currently, more than 45 million Americans (1 in 7) were living at or below the poverty line. This represents an increase from 13.2% to 15%. – the highest single year increase since 1959 when the government first started keeping such statistics. One reason is stalled US economic growth. Although President Obama is saying things are getting better, facts are that there has been a complete collapse of the US retail sector in the world’s largest economy. Both republicans and democrats, via their plutocratic policies, have obviated wage-levels for U.S. workers on behalf of large corporations so they will be able to "compete" with the wages of cheap labor in Asia all in the name of globalization. With reduced wages, in an age in which our economy was based on consumer spending and house buying, financed via foreign debt from banks who as we have learned were way undercapitalized and shady (LIBOR, MF Global, JPMorgan Chase, Wells Fargo, Citibank & others).

As of 2007, US household debt was 133% of household income. Maybe this is why the according to AARP, 600,000 American homeowners that are 50 years of age or older are currently in foreclosure. Why, because the average American consumer today is poor, under employed and/or unemployed. In fact, over the past 40 years, wages for the average U.S. worker have fallen by more than 50% (levels equal to the Great Depression).

Appears that present US fiscal and economic policy is converting the Middle Class into the Working Poor although they orate otherwise. How can we be in a a"recovery" when as a nation, we continue to sell less goods to consumers with lower incomes and increasingly more debt?  This for me is an indication that we are living in a time of incessant high inflation.

America’s economy will continue to get worse if our only solution is to print more paper money while food prices continue to increase and more people become under-employed, unemployed as our disability rolls grow exponentially. Our seems to be a nation that is very burdened with substantial debt, but also at the mercy of Wall Street and Banks and Corporations who would rather profit on the backs of the average consumer whether via fradulaent complex financial instrument money making schemes or risky gambling practices that the Federal government sanctions. Way I seee it, from this perspective, what is being called economic growth is more akin to a recesssion than growth at all.

Saturday, July 21, 2012

FBI‬ Wants a Database of Your Tattoos

Ever since President Obama signed National Defense Authorization Act (NDAA) 2012 into law, US law enforcement and military agencies have begun to document everything they can about American citizens. Whether it is the new biometric database that the FBI has started or the use of military spy drones domestically. Just this week, the firm D-Star Engineering has received what appears to be the first contract (for $4.8 million) awarded under the Intelligence Advanced Research Projects Agency’s (IARPA) Great Horned Owl (GHO) program to develop a new class of quiet small unmanned aircraft.

Now, FBI is consulting local police and vendors about new technology already at their disposable that would allow them to spot anyone by interpreting the symbolism of their tattoos.

According to recently released government documents, last week the FBI issued a request for information on existing databases “containing tattoo/symbol images, their possible meanings, gang affiliations, terrorist groups or other criminal organizations.” The request asks that all law enforcement agencies, vendors and academics to supply by Aug. 13 information about the capabilities of tattoo analysis systems. This follows work already underway by the FBI and Homeland Security Department to add iris and facial recognition services to their respective fingerprint databases.

Already, the FBI has amassed a large collection of biometric markers, including vocal tracks and handwriting samples. The question is who will the FBI and DHS target and how citizens can be sure that the government will not misuse this technology against innocent people. Another goal is to find out how tattoo databases draw on the knowledge of gang experts and how they may be used to document “possible meanings and gang affiliations” observed by officials nationwide.

Unfortunately, the overreaching activities of the FBI and DHS under the Obama administration raise major privacy and liberty concerns. Many of the activities described in the document, just like their online activities, are basic practices of any individual concerned with security or privacy. The U.S. Department of Homeland Security and Bureau have already stoked considerable privacy concerns from groups such as the Electronic Privacy Information Center (EPIC) and the Electronic Frontier Foundation have called for more transparency and oversight of such monitoring activities.

Thursday, July 19, 2012

Ten Ways Barack Obama and Mitt Romney are more alike than Different

There are just a few months left before the November Presidential elections. The choice has been mad for many in the simple terms of Democrat or Republican and Obama versus Romney. However, what is not known to most is that these two individuals actually are more alike than different.  We know about the basics: that the both like Star Trek, attended Harvard Law School and the Television situational comedy Modern Family, but they are just as alike from a policy perspective.  The following are ten examples in which they are more alike than different.

1. The signature legislative accomplishment of Obama which Romney has said he will repeal and replace “ObamaCare” was “RomneyCare,” which was the model for The Affordable Care Act.

2. Both wants to expand federal spending on Medicaid to help each state cover residents who cannot afford health insurance.

3. The big Wall Street Banks who received TARP bailout money that were top Obama donors in 2008 are top Romney donors in 2012.

4. The Obama Administration has yet to prosecute a single Wall Street executive for malfeasance related to the 2007 – 2008 financial crash. Wall Street’s aforementioned donation patterns make for a compelling conclusion: A Romney Administration would be no different.

5. Both oppose a full, annual, transparent, audit of the Federal Reserve’s finances and activities, suggesting the need for “Fed independence” from Congress.

6. Both would like a Value Added Tax as a potential fiscal policy solution and support international cap and trade policies via global carbon regulatory treaty and are both supporters of strict gun control measures.

7. Both Barack Obama and Mitt Romney prioritize “reducing our dependence on foreign oil,” pursuing alternative energy sources, and setting regulatory efficiency standards as part of federal energy policy.

8. Mitt Romney also supports the continued raids and prosecution of medical marijuana dispensaries (and even patients) that have characterized Obama Administration as well as Bush-era policy on medical marijuana.

9. Neither Obama nor Romney has military experience and both support the Bush era doctrine of preemptive war.

10. Neither Romney, nor Obama have offered a plan of detailed, substantive spending cuts to the out-of-control federal budget.

These are just ten ways.  I could go on and speak of how they both support executive line item vetoes, support continuing drug prohibition and the forty-year-old, Nixon-era War on Drugs, the legitimate power of the president to execute American citizens by “targeted killing” done in secret without charges or trial, support the controversial practice of extraordinary rendition, and their mutual support for support the warrantless wiretapping of the Bush-era USA Patriot Act. The truth is outside of ethnicity, religious faith and party, they are the same

Monday, July 16, 2012

Not Frank Ocean or Love And Hip Hop Atlanta, It’s LIBOR Stupid

What I attempt to tackle in this tractate is very important. No it is not about Love and Hip Hop Atlanta, Frank Ocean being Gay or his new release, it pertains to the LIBOR banking scandal. Now I know many may not care because it is not on the prior topics, but believe me it is more impactful and important on your daily lives than any of the scolisims listed as direct objects in the second sentence of this paragraph.

My interest in global economics began rather gratuitously, when I was given a book to read by one of my dormitory mates some three decades ago while an undergraduate at Morehouse College called “Tragedy and Hope” by Caroll Quigley. Since that time I have been well served, in particular given the saving and Loans crisis, Enron, financial crisis of 2008, the Lehman Brothers and AIG crises, and recently with loss of funds in MF Global and what have occurred with respect to PFGBest. Now there is the LIBOR scandal, which I think will be even more than or at least as disastrous as the massive amount of US debt held by foreign nations and the Eurozone crisis. Never had I imagined corruption would be so visible albeit I wrote and predicted such several times in 2008.

I attempted to find out the pulse of this from the African American perspective; however, after reading The Root, The Loop 21, The Grio, and a few other supposedly mainstream African American political and economic news outlets, I was astonished to find they had not written about LIBOR at all. Maybe I expected too much. Maybe their writers could not move beyond writing about Republicans, President Obama, or Mitt Romney, or worse that what they considered important and news worthy was frequently limited to Frank Ocean coming out of the closet, Reality TV and the mishaps of Celebrities ad nausea. Maybe they did not or have not studied global finances historically or read books like Ahmed Piquant “Lords of Finance” or Michael Panzer’s “When Giants Fail.”

LIBOR (the London Inter-Bank Offered Rate) is a benchmark off which to price commercial loans, mortgages, and other forms of lending. It has been a staple in the news as of late due to the admission by Barclays bank admitting that it deliberately understated the interest rates at which it could borrow between September 2007 and May 2009. So astonishing was this revelation that Barclays Chairman Robert E. Diamond Jr. resigned although he informed the British Parliament that he did not know that his bank was manipulating the index on which a major portion of international trade is based, in particular the rate at which banks loan money to other banks. Strange since the Wall Street Journal reported these occurrences four years ago.

Now most, or at least some who are well read are knowledgeable tacitly of Bernie Madoff and Enron’s Ken Lay, however the Libor interest rate scandal is even bigger because it not only involving hundreds of trillions in international derivatives trade, it impacts each of us directly in our pockets daily. For if the banks submitted artificially low Libor rates during the financial crisis in 2008, as Barclays has admitted, it would have led cities and states to receive smaller payments from financial contracts they had entered with their banks. Moreover, if such is the case, then by bankers’ manipulation of this major interest rate linked to hundreds of millions of dollars, then cities, states and municipal agencies nationwide, may have lost money in their public pension system and budget short falls as a consequence may have let to layoffs and even the loss of services due to closing parks, swimming pools, fire stations or other public sector offerings. Especiallly given the current economic conditions across the country and given that municipalities had borrowed based on rates derived via the manipulating the Libor rate of an estimated a $800 trillion derivatives market. The rate manipulation was occurring at a time in which the money was needed it the most – during a recession.

A coterie of banks are involved in setting Libor each day, including Bank of America, JPMorgan Chase, Deutsche Bank, Citigroup, and HSBC and Barclays. The Federal Reserve Bank of New York learned in April 2008 (Timothy F. Geithner served as the head of the New York Fed during this period), that some banks were reporting false interest rates.

All of the aforementioned is fact. We know about LIBOR because last month, Barclays admitted to regulators that it tried to manipulate Libor before and during the financial crisis in 2008, and paid $450 million to settle and also noted that other banks were doing the same, but none of them have been accused of wrongdoing. This even with a corpus of E-mail records of market manipulation so lucid that if the top executives were unaware it was simply because they did not want to.

On the personal level, the LIBOR rate influences what consumers, businesses and investors pay on a wide range of financial contracts from mortgages and interest rate swaps to credit cards and student loans. For the average monthly mortgage, I would estimate that it cast a family anywhere from $50 to $100 extra each month.  Umair Haque explained it the following way in a blog post for the Harvard Business Review: “Let me couch this for you in the pedestrian terms of financial hydraulics — the tawdry terms which seem to substitute for thinking in what's become of our thin, shallow economic and political discourse. The most basic function of a financial system is to price money. If a financial system can't undertake that simple task effectively — if the price of money is fixed like a roulette wheel stuck on red — all else must necessarily fail: investment must become malinvestment, speculation must precede creation, "profit" must become divorced from benefit, and wealth is effectively transferred from poor to rich, in a form of quiet but lethally effective institutionalized theft.”

Yep, it is on, and I do not even belive most of the world, especially my folk (African Americans) even care or want to understand this issue.  Sure it is about economics but it is not complex.  The problem is having the will and impetus to want to understand and know something. Again as I have stated many times before, Carter G. Woodson was correct: “If you can control a man's thinking you do not have to worry about his action. When you determine what a man shall think you do not have to concern yourself about what he will do. If you make a man feel that he is inferior, you do not have to compel him to accept an inferior status, for he will seek it himself. If you make a man think that he is justly an outcast, you do not have to order him to the back door. He will go without being told; and if there is no back door, his very nature will demand one.” 

Saturday, July 14, 2012

Black Urban Media: The New Blackploitation

Information is freely available everywhere. So much that it is easy to verify and substantiate with a little effort. However, for most African Americans, the major news topics of the day are ignored by their most treasured sources of information – black owned urban media and radio.

Now if you want to find out about the release of an album, which is sleeping with who, the latest baby momma or what celebrities were fighting at the club, black urban media is your place. Most it seems have adopted the playbook of the National Enquirer. Now they will cover every itty bitty nuanced piece of information on Love and Hip Hop Atlanta, Real Housewives and Basketball wives, as well as stories on young black men being shot by white men, but only after it becomes the focus of the world. And let us not forget President Obama, it seems as if the only politics covered dally with the commander in Chief 95 percent of the time. But rarely anything else. You won’t find anything on the Eurozone Crisis, or the LIBOR scandal, or serious presentations of what is occurring in Libya, Syria, Somalia, or even the continuing crisis in Haiti or the senseless shootings in Chicago.

If such topics are presented, they are aggregated and tend to not have any prospective insight regarding the direct impact they have of African Americans, and worse, if they involve being critical of the Obama Administration, they are not presented at all.

Now maybe Blackploitation is not the correct term, afterall they made certin not to shot at anyone other than “the man”, “charlie,” or uncle tomes helping the man. Not to mention their message was always one of the come-up and collective empowerment. Maybe I am making a big issue out of nothing, maybe I’m not. What I can say is that we in this medium are intentionally dumbing down our community by offering garbage over the proper material for health intellectual development.

I take this from the message I learned reading “the Miseducation of the Negro some 30 years ago written by Carter G. Woodson. In the book he wrote: My query is, are we in urban black media building the back door without asking? I have often asked when did getting paid become for important than education in our community. If the answer the the previous is yes, than I have my answer.

Friday, July 13, 2012

Syria: Another Progressive Proxy War on Behalf Of US for Israel to Attack Iran

I want to write a few paragraphs to present my understanding of the current Syrian Quagmire. But In order to do this, it requires I be in contradiction to the Obama’s Administration position on the nation, a brief comprehension of history and above all, objective.

 The way I have evaluated the US interest in Syria, it would purport that Israel desires toward Iran and nothing else is the focal point of this US and NATO instigation against Assad. First it is clearly evident that Palestinian’s know that Israel will not grant them a state unless it is forced to do so. This position has shown itself in overt terms via the election to the Egyptian presidency of Muhammad Mursi of the Muslim Brotherhood. Second, the economy more so than the protection of civilians or the desire for democratic transition is more essential for US economic interest than political interest; how else are we to keep our money making defense industries alive unless we are in incessant battle with terrorism, regardless if it exist or not?

Syria for the record as we know it today did not exist until a treaty ending in August 1920 after World War I at Sevres, France, between the Ottoman Empire (Turkey) and the Allies occurred. Now It is important to recall that this treaty destroyed the Ottoman Empire and Turkish sovereignty, but resulted in the sovereignty of Mesopotamia (Iraq), Palestine and Jordan. In the process, Palestine and Jordan were basically given to the British and Syria (including Lebanon), were given to the French. Turkey retained Anatolia but was to grant all of the aforementioned was finalized under the Treaty of Lausanne which was signed on 24th of July 1923.

However, since then the region has continued to show incessant signs of instability, namely because of the US interest in maintaining the desires of Israel over the self determination of other nations. Now, the Obama administration has inherited this shaky instability and obviously feel that the progressive approach as presented via example before him by Woodrow Wilson and Teddy Roosevelt, and even Truman is the best way to go for the United States, even if that means developing proxy wars on the behalf of the interest of other nations (Israel) over the interest of the US.

In simple terms the US and NATO’s are employing what they did in Libya and using it as a model to destabilize Syria, by hook or crook if needed. It may be hard for many to comprehend this if they lack a sufficient knowledge of the policies of Wilson and Truman, or worse, if they only believe and accept without query what is being fed to them by US mainstream media. The obvious outcome based on actions by all parties involved to date, will be a bombing attack on Iran’s nuclear and missile facilities – contingent upon the ousting of the current Syrian leadership - thus, using the resulting chaos of a failing Syrian state as a disguise an attack on Iran. Preferably, given the history of Turkey after World War I, the US will use them to serve as a cover front for deposing Assad and their subsequent attack on Iran – all which singularly benefit Israel.

Unbeknown to most, weapons from Saudi King Abdullah and Israel and possibly feed via the CIA are being sent to the rebels as I write. And I would not be surprised if the Saudi are not prepared with tanks and Special Forces to enter Jordan both to protect Jordan's King Abdullah against potential reprisals from Syria, Iran and even Iraq (yes Iraq) and attack Syria.

Obama has worked this out with Israel, knowing that Iran, Syria and Iraq are mainly Shiite and the Saudi’s mostly Sunni. Thus resulting in a Western-Arab-Turkish alliance military operation against Syria and eventually Iran. The problem is that Israel is still the target of most Arab states and that our present support for Islamist terrorists in Syria may proffer more risk than the present administration anticipates. We saw this before with Osama Bin Laden, who was cared for in the later stages of his kidney illness by the CIA’s own doctors for his support in waging war against the Soviet Union in Afghanistan (who eventually turned on the US) and Anwar al-Awlaki, also a CIA work horse who was even once invited to the Pentagon for dinner.

Although US media has not informed the public of such, the reality is just as in Libya, Afghanistan, and Iraq; the Syrian people do not want any Western intervention in their country.

Under the guise of “humanitarian,” the Obama administration has begun to wage an undeclared war on Iran in concert with Israel. This although the record indicates that talks between Iran and the UN Security saw the United States refuse to compromise when a deal was available whereby Iran would give up enriching uranium to 20% in exchange for an easing of sanctions and recognition of its right under the Nuclear Non-Proliferation Treaty to produce nuclear fuel for peaceful purposes. Instead, we accepted Israel’s demand that Iran be forced, by means of further sanctions and military threats, to suspend all enrichment. Strange when Israel and the US have nuclear weapons.

I cannot place all of this at the feat of Obama, albeit his neocolonial aggressiveness has resulted in the deposition of more leaders of sovereign states than any Presidents prior. Let’s face it, after all the uproar with Libya, we hear nothing about the nation now. Although we know that the ones we called “freedom fighters” have turned out to be sectarian terrorists now carrying out a brutal campaign of nationwide torture, illegal imprisonments, and genocide across the nation. Once all in Libya had free electricity – now they do not, and I will not mention how they are treating Black Africans. Entire towns have been wiped out with from ethnic and religious cleansing leaving the rest leaving the country for their lives. And I will not mention Somalia and several other African nations.

Yes this is our Syrian foreign policy in a nutshell. It’s not our policy and it isn’t about Syria. It’s Israel’s policy and it’s about Iran. In fact, according to US Army General Wesley Clark, since the early 1990′s, was aware of a plan to overthrow the “old client regimes” of the Soviet Union. In the post-9/11 era, the same efforts were resurfaced to invade and overthrow the governments of seven specific nations, Iraq, Syria, Lebanon, Libya Somalia, Sudan, and Iran as told by General Clark himself during a presentation he made at the Commonwealth Club of California, October 3, 2007.

Monday, July 02, 2012

Fifty Percent Unemployment for Blacks in New York – may become national norm

With the growing troubles of the Eurozone economic crisis, most recently as it pertains to Greece, massive bailouts for Italy and Spain and a recent request for European Central Bank support for more loans for Cyprus, the US economy continues to stall with projections of stagnant growth and perpetual unemployment above 8 percent. Now, with major banks being downgraded across the nation, it is clear again that blacks will bear the brunt of the economic downturn.
Historically, blacks always suffer disproportionately in times of economic hardship. Today it may be even worse than past decades, in particular in urban areas. According to a new study conducted by Dr. James Parrott, chief economist for the Fiscal Policy Institute, more than half of all of African-Americans in New York city who were old enough to work had no job at all in the past year based on an analysis of employment data compiled by the federal Labor Department.

Dr. Parrott’s results indicate that 49.2 percent of all black women of working age in the city had jobs in the year that ended in May – a figure approximately equal to the rate for black men in the same period, as well as in the first four months of 2012. New York is just a microcosm of the nation. Real unemployment (when you included those incarcerated, who have dropped out of the job market or in college full-time) for African Americans is in excess of 40 percent in May urban areas including Memphis, Detroit, Chicago and Detroit among others.

Many factors contribute to these outside of racism and included, low literacy and graduation rates, lower numbers of African Americans attending college, and very few blacks involved or interested in math and science of which most employment opportunities currently exist. Regardless, if the trend continues, 50 percent unemployment in urban areas for African Americans may become the norm.