Archive for June, 2015

ARE YOU READY FOR THE NEW WORLD CURRENCY?

June 29, 2015

The billboard promoting a “New World Currency” is near an International Airport in Asia. Most people have no idea what this billboard really means and won’t know until October or November of this year.

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Don’t expect Scott Pelley, Anderson Cooper, Brian Williams, Dian Sawyer, Ann Curry, Bill O’Reilly, Piers Morgan, Shepard Smith, Andrea Mitchell or Chris Wallace to tell you what it means. That’s why you pay me the big bucks. Despite the fact that the Currency Markets receive almost no attention from the mainstream press, developments in the currency markets will definitely affect you, your money, and your retirement. The Currency Market is 200 times the size of the Stock Market.

The IMF meets every five years. The International Monetary Fund (IMF) is an organization of 188 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world. The IMF will probably announce the results of this year’s meeting during the October-November time frame.

The following excerpt was published on the IMF Website just over a year ago under the headline: “The Dollar Reigns Supreme, by Default”

“The dollar has been the preeminent global reserve currency for most of the past century. Its status as the dominant world currency was cemented by the perception of international investors, including foreign central banks, that U.S. financial markets are a safe haven. That perception has ostensibly driven a significant portion of U.S. capital inflows, which have surged in the past two decades. Many believe that this dollar dominance has allowed the United States to live beyond its means, running sizable current account deficits financed by borrowing from the rest of the world at cheap interest rates. Some other countries have chafed at this “exorbitant privilege” enjoyed by the United States.

Moreover, the fact that a rich country like the United States has been a net importer of capital from middle-income countries like China has come to be seen as a prime example of global current account imbalances. Such uphill flows of capital—contrary to the prediction of standard economic models that capital should flow from richer to poorer countries—have led to calls for a restructuring of global finance and a reconsideration of the roles and relative importance of various reserve currencies.

The 2008–09 global financial crisis, whose aftershocks continue to reverberate through the world economy, led to heightened speculation about the dollar’s looming, if not imminent, displacement as the world’s leading currency.

Indeed there are indications that the dollar’s status should be in peril. The United States is beset by a high and rising level of public debt. Gross public (federal government) debt has risen to $16.8 trillion, roughly equal to the nation’s annual output of goods and services. The aggressive use of unconventional monetary policies by the Federal Reserve, the U.S. central bank, has increased the supply of dollars and created risks in the financial system. Moreover, political gridlock has made U.S. policymaking ineffectual and, in some cases, counterproductive in driving the economic recovery. There are also serious concerns that recent fiscal tightening has constrained the government’s ability to undertake expenditures on items such as education and infrastructure that matter for long-term productivity growth.”

I believe the currency story behind the billboard will be one of the defining events of American History and trigger one of the most profound transfers of wealth in my lifetime.

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The US dollar is not the only Reserve Currency but right now it dominates all other currencies. All other countries must convert their currency into dollars to pay for imports. What an advantage for the US! While the US is probably not involved in the trade, the dollar is. Can you imagine that many countries like China, India and Russia are getting a little sick of this dollar dominance?

The IMF considered adding Chinese currency as a Reserve Currency five years ago and decided not to add it. Things have changed as the US borrows billions a day from China and owes China 1.3 trillion dollars. Two years ago, in 2013, China became the largest exporter in the world. Today, 10,000 financial institutions deal in the Chinese Yuan including 40 central banks.

The signs I see tell me the US Dollar is on the way out even if the IMF does not make the Yuan a Reserve Currency. Google “AIIB” and “BRICS” to see the direction the rest of the world is headed including our closest allies. China has been busy taking advantage of our blunders such as giving away the Panama Canal. China took over the canal and is now working on two other passages between the Atlantic and Pacific including one rail and another larger canal. If you travel around the world you will see Chinese influences everywhere and you will also be shocked that NOBODY wants to accept your US dollars.

The United States cannot simply keep printing tons of Dollars to prop up the Stock Market and the US economy while selling gold and silver derivatives. The fourth major printing spree could happen again this year with QE4. The brilliant news media called the Reagan economy, “Trickle-down Economics” and “Voodoo” economics. The current policy of Trickle-up Economics seems to have run its course. The use of taxpayer funds to bailout big banks, auto companies and hedge funds didn’t seem to work. Even with the Union setting on the General Motors Board of Directors, 70% of the GM cars sold in America are manufactured overseas.

If the Yuan becomes a Reserve Currency it will likely quickly become the dominant Reserve Currency and the Dollar will come home to roost. Most countries HATE the United States and would gladly ship our Dollars back and start using the Yuan.

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Maybe you should listen to the talking heads stirring you up about the Confederate States of America Flag or Donald Trump calling a “spade” a “spade” or global warming or what should happen to Brian Williams. On the other hand, maybe you should pay a little attention to what your smiley faced politicians and the Supreme Court have in mind for your future? Perhaps you should look at the worst case scenario and start making preparations? If you think riots were bad over police killing one man, what would riots look like if grocery store shelves were empty or if a thousand dollars worth of food stamps wouldn’t buy a carton of cigarettes? What if the dollar was devalued by 30% or 70%? What if ISIS and Global Warming both attacked the US simultaneously along with Iran, Russia and China? I can’t advise you, I’m just an old retired fighter pilot.  Maybe it’s time to do your own research and be prepared?

HEALTH INSURANCE STOCKS SOAR WHILE THE CONSTITUTION WEEPS

June 25, 2015

God Bless Associate Justice Antonin Scalia

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Nothing the Supreme Court does should surprise you! Again, Chief Justice John Roberts trampled on the Constitution on behalf of President Obama. In a landmark 6-3 ruling, the Supreme Court on Thursday upheld the Affordable Care Act’s insurance subsidies in every state.

One of the Justices who meant it when he swore to uphold and defend the Constitution, Justice Antonin Scalia, wrote the dissenting opinion, and characterized that Chief Justice John Roberts is a “defense of the indefensible.” And “rewrites the law.” He went on to write, “We should start calling this law SCOTUScare.”

He continued: “Rather than rewriting the law under the pretense of interpreting it, the Court should have left it to Congress to decide what to do about the Act’s limitation of tax credits to state exchanges.”

If the Court had ruled the other way, about 6 million people would have been at risk of losing their coverage. As it is, 100 million people will have to live with worthless insurance that they can’t afford. Last year 31% of Americans went without some form of healthcare because they could not afford the $150 copay or the $5,000 deductible.

Our leaders in the House and Senate along with President Obama and six Supreme Court Justices have decided the healthcare of 6 million people outweighs the other 300 million. The fact that the 6 million are not getting good care either notwithstanding.

Scalia, who read his dissent from the bench, was joined by Justices Clarence Thomas and Samuel Alito in his dissent. Scalia took issue with the majority’s interpretation of the language within the Affordable Care Act. The law states that in order for people to qualify for health care subsidies, they need to be “enrolled in through an exchange established by the state.” The majority upheld that by “state,” the law referred to individual state exchanges or exchanges set up by the federal government. Otherwise, the majority opinion stated, state exchanges would drown in a “death spiral.”

Roberts wrote that “it is implausible that Congress meant the Act to operate in this manner.”

Scalia heavily criticized this reading, saying that the majority has erroneously interpreted the word “state” to also mean “federal government.” He called parts of the majority opinion “interpretive jiggery-pokery.”

“The Secretary of Health and Human Services is not a state,” he wrote. “Words no longer have meaning if an exchange that is not established by a state is ‘established by the state.'”

Scalia wrote that the justices who authored the majority displayed “no semblance of shame” in their opinion. His dissent is littered with jabs at his fellow justices. “Today’s interpretation is not merely unnatural; it is unheard of,” Scalia writes. He describes another aspect of the majority’s analysis to be “pure applesauce.”

King v. Burwell was one of the biggest legal challenges to Obamacare since 2012, when the Court upheld Obamacare’s individual mandate. In the conclusion of his dissent, Scalia said the Court got it wrong both times—and that it has shown bias toward the Obama administration’s policies.

“The cases will publish forever the discouraging truth that the Supreme Court of the United States favors some laws over others, and is prepared to do whatever it takes to uphold and assist its favorites,” Scalia wrote. “I dissent.”

God bless Associate Justice Antonin Gregory Scalia, the longest-serving justice currently on the Court. Scalia is the Senior Associate Justice. Appointed to the Court by President Ronald Reagan in 1986, Scalia has been described as the intellectual anchor for the originalist and textualist position in the Court’s conservative wing.

Scalia was born in Trenton, New Jersey, and attended public grade school and Catholic high school in New York City, where his family had moved. He attended Georgetown University as an undergraduate and obtained his Bachelor of Laws degree from Harvard Law School. After spending six years in a Cleveland law firm, he became a law school professor at the University of Virginia. In the early 1970s, he served in the Nixon and Ford administrations, first at minor administrative agencies, and then as an assistant attorney general. He spent most of the Carter years teaching at the University of Chicago, where he became one of the first faculty advisers of the fledgling Federalist Society. In 1982, he was appointed as a judge of the United States Court of Appeals for the District of Columbia Circuit by President Ronald Reagan.

In 1986, Scalia was appointed by Reagan to the Supreme Court to fill the associate justice seat vacated when Justice William Rehnquist was elevated to Chief Justice. Whereas Rehnquist’s confirmation was contentious, Scalia was asked few difficult questions by the Senate Judiciary Committee, and faced no opposition. Scalia was unanimously confirmed by the Senate, becoming the first Italian-American justice.

Scalia has served on the Court for nearly thirty years, during which time he has established a solidly conservative voting record and ideology, advocating textualism in statutory interpretation and originalism in constitutional interpretation.

ROBERT E. LEE, A GREAT AMERICAN

June 23, 2015

General Robert E. Lee was offered a major command in the Union Army and had no desire to see the United States divided. Lee was the son of Revolutionary War officer Henry “Light Horse Harry” Lee III and a top graduate of the United States Military Academy. General Lee was an exceptional officer and combat engineer in the United States Army for 32 years. During this time, he served throughout the United States, distinguished himself during the Mexican–American War and served as Superintendent of the United States Military Academy.

Lee’s decision was based on the decision made by his state of Virginia. When Virginia declared its secession from the Union in April 1861, Lee remained loyal to his home state. In the end, Lee surrendered to U.S. Grant at the MacLean House by Appomattox Court House on April 9, 1865. By this time, Lee had assumed supreme command of the remaining Southern armies; other Confederate forces swiftly capitulated after his surrender. Lee rejected the proposal of a sustained insurgency against the North and called for reconciliation between the two sides.

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I considered it a great privilege when I stood in this very room where Robert E. Lee and Ulysses S. Grant met to conclude the surrender.

On October 2, 1865, the same day that Lee was inaugurated as president of Washington College in Lexington, Virginia, he signed an Amnesty Oath but Lee was not pardoned, nor was his citizenship restored.

Three years later, on December 25, 1868, President Johnson proclaimed a second amnesty which removed previous exceptions, such as the one that affected Lee.

General Robert E. Lee turned down several financially tantalizing offers of employment that would merely have traded on his name and instead accepted the post of college president for three reasons. First, he had been superintendent of the United States Military Academy, so supervising higher education was in his background. Second, and more important, he believed that it was a position in which he could actually make a contribution to the reconciliation of the nation. Third, the Washington family was his in-laws: his wife was the great-granddaughter of Martha Washington, and Lee had long looked on George Washington as a hero and role model.

Arguably Lee’s finest achievement was transforming a small, not particularly distinguished Latin academy into a forward-looking institution of higher education. He established the first journalism courses and he added both engineering courses and a business school and a law school to the college curriculum. That was a radical idea since engineering, journalism, and law had always been considered technical crafts, not intellectual endeavors, and the study of business was viewed with skepticism.

Lee was also the father of an Honor System and a speaking tradition at Washington College that continues to the present time. And, ardent about restoring national unity, he successfully recruited students from throughout the reunited nation, North and South.

Lee died on October 12, 1870, after just five years as Washington College president. The college’s name was almost immediately changed to Washington and Lee University, linking Lee’s name with Washington’s. The university’s motto, Nōn Incautus Futūrī’, meaning “Not unmindful of the future”, is an adaptation of the Lee family motto. Lee’s son, George Washington Custis Lee, followed his father as the university’s president. General Lee and much of his family—including his wife, his seven children, and his father, the Revolutionary War hero “Light Horse Harry” Lee—are buried in the Lee Chapel on campus, which faces the main row of antebellum college buildings. Robert E. Lee’s beloved horse Traveller is buried outside, near the wall of the chapel.

THE CONFEDERATE FLAG & AMERICAN HISTORY

June 23, 2015

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Let me preface my epistle with this, my great-great grandfather was a Southerner who lived in Arkansas and fought for the Union Army. He was a prisoner in Andersonville Prison almost the entire time the prison was open. Nobody in my family fought for the Confederacy. Thousands of citizens in North Arkansas remained loyal to the Union.

However, the Confederate Flag was hoisted above the State Capitol Buildings of the following states listed in the order of their secession:

1. South Carolina
2. Mississippi
3. Florida
4. Alabama
5. Georgia
6. Louisiana
7. Texas
8. Virginia
9. Arkansas
10. Tennessee
11. North Carolina

In addition to these states, the southern part of New Mexico Territory formed a secession convention, which voted to join the Confederacy on March 16, 1861, and appointed Lewis Owings as the new territorial governor. They won the Battle of Mesilla and established a territorial government with Mesilla serving as its capital. The Confederacy proclaimed the Confederate Arizona Territory on February 14, 1862 north to the 34th parallel. Marcus H. MacWillie served in both Confederate Congresses as Arizona’s delegate. In 1862 the Confederate New Mexico Campaign to take the northern half of the U.S. territory failed and the Confederate territorial government in exile relocated to San Antonio, Texas.

Confederate supporters in the trans-Mississippi west also claimed portions of United States Indian Territory after the United States evacuated the federal forts and installations. Over half of the American Indian troops participating in the Civil War from the Indian Territory supported the Confederacy; troops and one general were enlisted from each tribe. On July 12, 1861, the Confederate government signed a treaty with both the Choctaw and Chickasaw Indian nations. After several battles Northern armies moved back into the territory.

Indian Territory, now Oklahoma, was never formally ceded into the Confederacy by American Indian councils, but like Missouri and Kentucky, the Five Civilized Nations received representation in the Confederate Congress and their citizens were integrated into regular Confederate Army units. After 1863 the tribal governments sent representatives to the Confederate Congress: Elias Cornelius Boudinot representing the Cherokee and Samuel Benton Callahan representing the Seminole and Creek people. The Cherokee Nation, aligning with the Confederacy, alleged northern violations of the Constitution, waging war against slavery commercial and political interests, abolishing slavery in the Indian Territory, and that the North intended to seize additional Indian lands. In all, about 12,000 American Indians served in the army of the Confederacy and around 6,000 served in the Union army.

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The largest force in Indian Territory was commanded by Confederate Brigadier General Stand Watie, who was also a chief of the Cherokee Nation. Dedicated to the Confederate cause and unwilling to admit defeat, he kept his troops in the field for nearly a month after Lieutenant General E. Kirby Smith surrendered the Trans- Mississippi. Finally, Watie rode into Doaksville near Fort Towson in Indian Territory and surrendered his battalion of Creek, Seminole, Cherokee, and Osage Indians to Lieutenant Colonel Asa C. Matthews, appointed a few weeks earlier to negotiate a peace with the Indians. Watie was the last Confederate general officer to surrender his command.

Colonel Matthew Arbuckle commanded the 7th Infantry Regiment and led four companies to reinforce Fort Smith in 1821. In 1824, he moved the regiment farther west, establishing Forts Gibson and Towson, the first military posts in the Indian Territory. Fort Towson was named for Nathaniel Towson, Paymaster General of the Army.

The simple fact is that we can lie about our history but we CANNOT change our history. If America refuses to learn from history, we are doomed to repeat our history. Very little of America’s good history is taught in schools while the Father of Our Country is often disparaged.

George Washington did not fight the Revolutionary War from the Pentagon! He and many others mutually pledged to each other their Lives, their Fortunes, and their sacred Honor. The soldiers in the Continental Army saw themselves as Cincinnati and Washington was called the American Cincinnatus. Today, hardly anybody even knows who Cincinnatus was but every school student in Colonial America knew his story.

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After Washington won the war, he spent six years as President of the Society of the Cincinnati, America’s first Veterans Organization. He immersed himself in Veteran’s issues including jobs, healthcare, pensions and care for their widows and orphans.

After those six years, George Washington became our First President and other members of the Veteran’s Organization became Our Founding Fathers. These men were not politicians who gained power with cute sound bites promising free stuff, they were Patriots who fought for freedom and loved America. Did you know that the leaders of a Veteran’s Organization became the leaders of The United States of America? While President Washington flatly refused a third term as United States President, he remained President of the Society of the Cincinnati for the rest of his life. While George Washington only wore three stars on his uniform, no military officer in the United States can EVER outrank him by Federal Law.

As politician after politician promises to improve education, our education slides farther down the ladder of mediocrity. When prayer was banned in school, America was number one in the world, now we are 28th in education.

If our children knew our history they might love America as I do. If you want your children to know our history, you will have to teach them yourself. Like each of us, there is good, bad and ugly in our Nation’s past. I respect those who morn their Confederate ancestors who died for a cause they believed in as I honor my great-great grandfather, Joseph P. McVay, who emerged from the Civil War a broken man stabbed by a Confederate bayonet while in captivity.

REAL THREATS TO THE US POWER GRID

June 21, 2015

THIS IS REAL UNLIKE THE JUNK SCIENCE OF GLOBAL WARMING!

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About once every four days, part of the nation’s power grid is struck by a cyber or physical attack. Such attacks can leave millions without power. A major natural or intentional attack could destroy life as we know it. Before you think I am exaggerating, read on.

Although the repeated security breaches have never resulted in the type of cascading outage that swept across the Northeast in 2003, they have sharpened concerns about vulnerabilities in the electric system. A widespread outage lasting even a few days could disable devices ranging from ATMs to cellphones to traffic lights, gas pumps and could threaten lives if heating, air conditioning and health care systems exhaust their backup power supplies.

Some experts and officials fear the rash of smaller-scale incidents may point to broader security problems, raising questions about what can be done to safeguard the electrical grid from an attack that could leave millions without power for days or weeks, with potentially devastating consequences.

“It’s one of those things: One is too many, so that’s why we have to pay attention,” said Federal Energy Regulatory Commission Chairman Cheryl LaFleur. “The threats continue to evolve, and we have to continue to evolve as well.”

An examination by USA TODAY in collaboration with more than 10 Gannett newspapers and TV stations across the country, and drawing on thousands of pages of government records, federal energy data and a survey of more than 50 electric utilities, finds:

• More often than once a week, the physical and computerized security mechanisms intended to protect Americans from widespread power outages are affected by attacks, with less severe cyberattacks happening even more often.

• Transformers and other critical equipment often sit in plain view, protected only by chain-link fencing and a few security cameras.

• Suspects have never been identified in connection with many of the 300-plus attacks on electrical infrastructure since 2011.

• An organization funded by the power industry writes and enforces the industry’s own guidelines for security, and decreased the number of security penalties it issued by 30% from 2013 to 2014, leading to questions about oversight.

Jon Wellinghoff, former chairman of the Federal Energy Regulatory Commission, said the power grid is currently “too susceptible to a cascading outage” because of its reliance on a small number of critical substations and other physical equipment.

Because the nation’s electrical grid operates as an interdependent network, the failure of any one element requires energy to be drawn from other areas. If multiple parts fail at the same time, there is the potential for a cascading effect that could leave millions in the darks for days, weeks or longer.

“Those critical nodes can, in fact, be attacked in one way or another,” Wellinghoff said. “You have a very vulnerable system that will continue to be vulnerable until we figure out a way to break it out into more distributed systems.”

Some of the worst fears of those in charge of the power grid’s security came true shortly before 1 a.m. on April 16, 2013, when unknown attackers unleashed a coordinated attack on Pacific Gas & Electric’s Metcalf substation in northern California.

The attackers severed six underground fiber-optic lines before firing more than 100 rounds of ammunition at the substation’s transformers, causing more than $15 million in damage.

The intentional act of sabotage, likely involving more than one gunman, was unlike any previous attack on the nation’s grid in its scale and sophistication.

Yet officers did not begin investigating the scene until hours after the shooting took place. Security footage from the shooting is grainy. The attackers were never caught.

Power was not lost, but the nature of the Metcalf attack sent shock waves through the industry.

“Shooting at substations, unfortunately, is not uncommon,” Sue Kelly, president and CEO of the American Public Power Association, an industry group, said of the incident at a Senate hearing last year. “But this incident demonstrated a level of sophistication not previously seen in our sector.”

At a California Public Utilities Commission meeting last year to review the incident, PG&E senior director of substations Ken Wells said the Metcalf attack was “a game changer.”

“No doubt about it, …this event caused us and the entire industry to take a new and closer look at our critical facilities and what we can do to protect them,” Wells said.

As a result of the Metcalf incident, PG&E said it would invest $100 million over three years on new security around many of its critical facilities, including better security cameras, fencing and lighting.

Yet records from hundreds of other attacks in recent years show similar weaknesses still exist at thousands of electric facilities across the country, allowing repeated breaches.

Between 2011 and 2014, electric utilities reported 362 physical and cyberattacks that caused outages or other power disturbances to the U.S. Department of Energy. Of those, 14 were cyberattacks and the rest were physical in nature.

• In 2011, an intruder gained access to a critical hydro-electric converter station in Vermont by smashing a lock on a door.

• In 2013, a gunman fired multiple shots at a gas turbine power plant along the Missouri-Kansas border.

• Also in 2013, four bullets fired from a highway struck a power substation outside Colorado Springs.

No suspects were apprehended in those three incidents. Federal data show such attacks are not rare within the sprawling, interdependent network of transformers, power lines and other equipment that make up the electrical grid.

Often, such incidents are shrugged off by the local police who initially investigate.

In March 2013, security officers at the Jacksonville Electric Authority in Florida noticed a man climbing a fence surrounding St. Johns River Power Park, which produces energy for 250,000 northern Florida households.

The man fled when approached, Jacksonville Electric Authority spokeswoman Gerri Boyce said, and was later observed trying to enter a second facility. He fled again and was never caught.

Nobody filed a police report, according to Jacksonville Sheriff’s Office documents.

Federal records show it is not just large communities that are at risk of attack. Even small, rural utility companies have been subject to foul play.

After a 2011 cyberattack struck the Pedernales Electric Cooperative — a non-profit utility that serves about 200,000 customers across a vast agrarian region of Texas — the utility’s CEO, R.B. Sloan, shared his surprise with the utility’s board of directors.

“You would think if they really wanted to have an impact, they would go for something (else),” he said in a public meeting. Sloan said at the time that the utility filed reports with the Department of Energy and FBI, but he was concerned about the way they handled it.

“It’s obvious to us that some of the regulatory bodies are not well-equipped to accept these and follow up,” he said during the 2011 meeting. “I think this event has made that very apparent.”

Now an executive for a Georgia utility software company, Sloan declined to discuss the attack.

While the Department of Energy received only 14 reports of cyberattacks from utilities over the past four years, other reporting systems show rising cyberthreats.

The branch of the Department of Homeland Security that monitors cyberthreats received reports of 151 “cyber incidents” related to the energy industry in 2013 — up from 111 in 2012 and 31 in 2011. It is uncertain whether the increase is due to more incidents or an increase in reporting.

NOW FOR THE SHOW STOPPERS

The solar storm of 1859, also known as the Carrington event, was a powerful geomagnetic solar storm. A solar coronal mass ejection hit Earth’s magnetosphere and induced one of the largest geomagnetic storms on record. The associated “white light flare” in the solar photosphere was observed and recorded by English astronomers Richard C. Carrington and Richard Hodgson.

Telegraph systems all over Europe and North America failed, in some cases giving telegraph operators electric shocks. Telegraph pylons threw sparks. Some telegraph operators could continue to send and receive messages despite having disconnected their power supplies. From August 28 through September 2, 1859, numerous sunspots were observed on the Sun. On August 29, southern aurorae were observed as far north as Queensland, Australia. Just before noon on September 1, the English amateur astronomers Richard Carrington and Richard Hodgson independently made the first observations of a solar flare. The flare was associated with a major coronal mass ejection (CME) that travelled directly toward Earth, taking 17.6 hours to make the 93 million mile journey.

Studies have shown that a solar storm of this magnitude occurring today would likely cause widespread problems for modern civilization. The solar storm of 2012 was of similar magnitude, but it passed Earth’s orbit without striking the Earth.

In June 2013, a joint venture from researchers at Lloyd’s of London and Atmospheric and Environmental Research in the United States used data from the Carrington Event to estimate the current cost of a similar event to the US alone at up to $2.6 trillion.

ONE EMP BURST AND THE WORLD GOES DARK

The sky erupts. Cities darken, food spoils and homes fall silent. Civilization collapses. End-of-the-world novel? A video game? Or could such a scenario loom in America’s future?

There is talk of catastrophe ahead, depending on whom you believe, because of the threat of an electromagnetic pulse triggered by either a supersized solar storm or terrorist A-bomb, both capable of disabling the electric grid that powers modern life.

Electromagnetic pulses (EMP) are oversized outbursts of atmospheric electricity. I previously discussed an EMP powered by geomagnetic storms. The same thing can occur with a nuclear blast in our atmosphere. The resultant intense magnetic fields can induce ground currents strong enough to burn out power lines and electrical equipment across state lines.

The threat has even become political fodder, drawing warnings from former House speaker Newt Gingrich.

“We are not today hardened against this,” he told a Heritage Foundation audience. “It is an enormous catastrophic threat.”

There are “some important reasons for concern,” says physicist Yousaf Butt of the Harvard-Smithsonian Center for Astrophysics in Cambridge, Mass. “But there is also a lot of fluff.”

At risk are the more than 200,000 miles of high-voltage transmission lines that cross North America, supplying 1,800 utilities the power for TVs, lights, refrigerators and air conditioners in homes, and for the businesses, hospitals and police stations that take care of us all.

“The electric grid’s vulnerability to cyber and to other attacks is one of the single greatest threats to our national security,” Rep. Ed Markey, D-Mass.

Markey and others point to the August 2003 blackout that struck states from Michigan to Massachusetts, and southeastern Canada, as a sign of the grid’s vulnerability. Triggered by high-voltage lines stretched by heat until they sagged onto overgrown tree branches, the two-day blackout shut down 100 power plants, cut juice to about 55 million people and cost $6 billion, says the 2004 U.S.-Canada Power System Outage Task Force.

The electromagnetic pulse threat is a function of simple physics: Electromagnetic pulses and geomagnetic storms can alter Earth’s magnetic field. Changing magnetic fields in the atmosphere, in turn, can trigger surging currents in power lines.

Two historic incidents often figure in the discussion:

• On July 9, 1962, the Atomic Energy Commission and the Defense Atomic Support Agency detonated the Starfish Prime, a 1.4-megaton H-bomb test at an altitude of 250 miles, some 900 miles southwest of Hawaii over the Pacific Ocean. The pulse shorted out streetlights in Oahu.

• On March 9, 1989, the sun spat a million-mile-wide blast of high-temperature charged solar gas straight at the Earth. The “coronal mass ejection” struck the planet three days later, triggering a geomagnetic storm that made the northern lights visible in Texas. The storm also induced currents in Quebec’s power grid that knocked out power for 6 million people in Canada and the USA for at least nine hours.

“A lot of the questions are what steps does it make sense to take,” Legge says. “We could effectively gold-plate every component in the system, but the cost would mean that people can’t afford the rates that would result to pay for it.”

“The high-altitude nuclear-weapon-generated electromagnetic pulse is one of a small number of threats that has the potential to hold our society seriously at risk,” concluded a 2008 EMP Commission report headed by William Graham, a former science adviser to President Reagan.

In the nuclear scenario, the detonation of an atomic bomb anywhere from 25 to 500 miles high electrifies, or ionizes, the atmosphere about 25 miles up, triggering a series of electromagnetic pulses. The pulse’s reach varies with the size of the bomb, the height of its blast and design.

Gingrich cited the EMP Commission report in warning, “One weapon of this kind that went off over Omaha would eliminate most of the electrical production in the United States.”

Proposed fixes can cost a fortune but I am told that the main threat can be eliminated with about $2 billion worth of surge protectors. To date, almost nothing has been done.

OUR HOUSE OF CARDS

June 16, 2015

It is easy to get caught up in the HOUSE OF CARDS that is QUANTITATIVE EASING. You have a right to know what our politicians are doing.

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Generally, quantitative easing involves central banks buying up bonds with newly created money. This scheme is expected to boost economic growth as it has the following effects:
• Buying up large quantities of bonds suppresses long-term interest rates. This is extremely important, as long-term interest rates are far more important for economic growth than short-term interest rates.
• Substantially forcing down interest rates – particularly yields on government bonds – encourages investors to seek refuge in riskier investments because the return is higher. Oops, the risks are also MUCH higher. In other words: Quantitative easing generates an increase in investment in stocks, company bonds, and the like.
• Lower interest rates prompt more borrowing and less saving. I don’t think that is good for the people since 31% said they went without some form of medical care in the last year because they couldn’t afford it. One in five said their spending exceeded their income over the last year, just 63% said they saved any money at all over the past 12 months and 31% of nonretirees said they had no retirement savings or pension.
• Higher stock and bond prices improve the balance sheet position for many parties. If too many old debts were the reason for not borrowing any more, that situation changes if asset values rise and particularly if housing prices rise as well.
• Generally, the currency of the country implementing quantitative easing depreciates, as it becomes more appealing for domestic investors to invest in the country in question, due to lower interest rates. There is also more money in circulation, part of which will probably be invested elsewhere. A cheaper currency then aids foreign trade.

However, QE cannot simply generate wealth, and the drawbacks and potential risks of even more QE will become greater the more money that the U.S. prints out of thin air. Therefore, QE has several drawbacks worth considering for both policy makers and investors:
• It will only buy more time. It does not solve the underlying economic problems.
• The pressure on politicians to take the necessary structural measures to create higher economic growth is temporarily alleviated if interest rates are being depressed.
• Speculation of quantitative easing has an upward effect on commodity prices. As Western countries and Japan have to import a lot of commodities, that inhibits growth.
• Quantitative easing forces investors to step into ever-riskier investments. That could cause an enormous problem in a subsequent recession.
• Should QE achieve to temporarily lift economic growth through higher credit extension, inflation will rise immediately as the enormous amount of money created flows into the real economy. Investors in bonds will anticipate this, and will begin selling bonds – they lose more value the higher inflation expectations – so there is a high risks that interest rates rise even more than inflation. The result is that it becomes increasingly expensive for both the government and the private sector to refinance debts, and risks of bankruptcy loom.
• If the central bank does try to avert higher inflation and interest rates when the economy starts growing again, it has to drain the money it has pumped into the banks before. The more money printed, the more money has to be withdrawn. To the extent that high money creation boosted asset prices, the opposite occurs if liquidity is withdrawn from the system. The more money printed, the more downward pressure there will be on asset prices if the central bank reverses this process.

So, here we are between a rock and a hard place. If printing dollars out of thin air was good then the more the U.S. prints the better, right? Sort of like the minimum wage; if raising the minimum wage to $15 an hour is good, raising it to $100 would be GREAT, right? In my humble opinion, Gold Prices should be at least triple what they are and stock prices about one third of what they are. So how does this work? If only gold was traded it could not be easily manipulated because it is a finite commodity. No problem, just create derivatives. During the last two years gold is up in a bull market in EVERY currency in the world except one, the dollar. In the dollar gold is down. Draw your own conclusions.

DEFINITION OF ‘DERIVATIVE’
“A security whose price is dependent upon or derived from one or more underlying assets. The derivative itself is merely a contract between two or more parties. Its value is determined by fluctuations in the underlying asset. The most common underlying assets include stocks, bonds, commodities, currencies, interest rates and market indexes. Most derivatives are characterized by high leverage.”

The contracts to buy or sell gold FAR EXCEED the total supply of gold. The same can happen with any commodity. A farmer wants to lock in the price of his corn so he sells futures on 100,000 bushels of corn that expire in September. When that contract expires in September the farmer must produce the corn or buy back the contract. Traders or speculators setting in a skyscraper on Wall Street can also sell corn. They can sell as much as people will buy even if the contracts exceed all the corn on the whole planet. If they think the prices will go down they sell, if they think prices will go up they buy. In the House of Cards you can sell things you don’t have. So what is determining the price of corn, the supply and demand of the corn or the action of the derivatives?

It is one big game played on a giant stage. Speculators buy orange juice futures, rumors circulate that a freeze is coming and prices soar. A drought falls over the Corn Belt and prices soar. Rain comes and prices drop. Someone’s great aunt has a toe pain and pork bellies collapse.

THIS WAS IN THE NEWS A FEW YEARS AGO:

“GOLDMAN SACHS HEDGE FUND GETS $3 BILLION BAILOUT

Goldman Sachs Group said a group of investors that includes Eli Broad and Hank Greenberg will sink $3 billion into one of its biggest hedge funds, which has seen its value plunge amid market volatility.

The investment bank said its Global Equity Opportunities fund “suffered significantly” as global markets sold off on worries about debt and credit. The fund lost as much as 14% of its value during the past 12 months, according to media reports, and is currently worth about $3.6 billion.

Goldman Sachs will lead the group of investors to help bail out the hedge fund, which relies on computer-driven trading strategies. Other investors include Broad, Greenberg’s C.V. Starr, and Perry Capital.

In addition, the investment bank said that two other hedge funds it manages — Global Alpha and the North American Equities Opportunities Fund — have also suffered during the market dislocation. Goldman said it “reduced risk and leverage” in the funds to stem losses.”

The Media and Democrats applied the term, TRICKLE DOWN ECONOMY to Ronald Reagan’s tax cuts in the wake of Jimmy Carter’s liberal policies. The term has been attributed to humorist Will Rogers, who said during the Great Depression that “money was all appropriated for the top in hopes that it would trickle down to the needy.”

During this period of government bailouts and wild money printing, the Trickle Down Economy should be in its glory days but 47% of Americans say that if they had a $400 unexpected expense they would have to sell something or borrow money to pay it. The median family income has dropped about $5,000 in recent years. Americans are struggling and things can get MUCH worse. Our government punishes our legitimate businesses with the world’s highest taxes, the world’s most burdensome regulations and forced expenses like minimum wage and forced unionization. The result is as predictable as the sunrise. Companies either go bankrupt or move overseas. On top of all this, our government has opened the flood gates to the world’s poor, uneducated, unhealthy huddled masses yearning to jump on the welfare gravy train. It’s called Immigration Reform.

Don’t worry; all the politicians have been promising to help the middle class for several years!

Maybe the Stock Market will never crash AGAIN and the House of Cards will stand forever? I read the speculation about a recession and more QE this year but how would I know? I think we all should pay close attention to the totality of the threat to the American Way of Life. You will not learn it from the Media or your friendly politician.

NOTHING IS EASY

June 13, 2015

MY TRIBUTE TO MAHALIA JACKSON

Mahalia

Born in New Orleans in 1911, Mahalia Jackson grew up in a house shared by 13 people. Raised by her Aunt Duke after her mother died in 1917, economic circumstances forced Jackson to quit school and work at home when she was in fourth grade. Her earliest influences were the sights and sounds of Uptown New Orleans: banana steamships on the Mississippi River, acorns roasting in Audubon Park, hot jazz bands, the beat-driven music of the Sanctified Church, and Bessie Smith’s bluesy voice drifting from her Cousin Fred’s record player. But Jackson found her greatest inspiration at Mt. Moriah Baptist Church, where she sang on Wednesday, Friday, and four times on Sunday. Even at age 12, her powerful voice could be heard all the way to the end of the block. “You going to be famous in this world and walk with kings and queens,” said her Aunt Bell, predicting an illustrious future for a voice that would change the face of American music, empower the Civil Rights movement, and bring Mahalia Jackson worldwide renown.

Although she was encouraged to take singing lesions so white people could understand her, she resisted. Possessing a powerful contralto voice, she was referred to as “The Queen of Gospel”. She became one of the most influential gospel singers in the world and was heralded internationally as a singer and civil rights activist. She was described by entertainer Harry Belafonte as “the single most powerful black woman in the United States”. She recorded about 30 albums mostly for Columbia Records and her 45 rpm records included a dozen GOLD.

“I sing God’s music because it makes me feel free”, Jackson once said about her choice of gospel, adding, “It gives me hope. With the blues, when you finish, you still have the blues.”

At birth, Jackson suffered from genu varum, or “bowed legs”. The doctors wanted to perform surgery by breaking her legs, but one of the resident aunts opposed it. Jackson’s mother would rub her legs down with greasy dishwater. The condition never stopped young Jackson from performing her dance steps for the white woman her mother and Aunt Bell cleaned house.

Jackson was five when her mother Charity died, leaving her family to decide who would raise her and her brother. Aunt Duke assumed this responsibility, and the children were forced to work from sunup to sundown. Aunt Duke would always inspect the house using the “white glove” method. If the house was not cleaned properly, Jackson was beaten. If one of the other relatives could not do their chores or clean at their job, Jackson or one of her cousins was expected to perform that particular task. School was hardly an option. Jackson loved to sing and church is where she loved to sing the most. Her Aunt Bell told her one day she would sing in front of royalty, a prediction that would eventually come true. Jackson began her singing career at the local Mount Mariah Baptist Church. She was baptized in the Mississippi River by Mt. Mariah’s pastor, the Rev. E.D. Lawrence, she then went back to the church to “receive the right hand of fellowship”.

In 1927, at the age of sixteen, Jackson moved to Chicago, Illinois, in the midst of the Great Migration. At her first Sunday church service she had given an impromptu performance of her favorite song, “Hand Me Down My Silver Trumpet, Gabriel”, which drew an admonishment from the Pastor. Nevertheless, she was invited to join the Greater Salem Baptist Church Choir. She began touring the city’s churches and surrounding areas with the Johnson Gospel Singers, one of the earliest professional gospel groups. In 1929, Jackson met the composer Thomas A. Dorsey, known as the Father of Gospel Music. He gave her musical advice, and in the mid-1930s they began a 14-year association of touring, with Jackson singing Dorsey’s songs in church programs and at conventions. His “Take My Hand, Precious Lord” became her signature song.

In 1936, Jackson married Isaac Lanes Grey Hockenhull (“Ike”), a graduate of Fisk University and Tuskegee Institute who was 10 years her senior. She refused to sing secular music, a pledge she would keep throughout her professional life. She was frequently offered money to do so and she divorced Isaac in 1941 because of his unrelenting pressure on her to sing secular music.

In 1931, Jackson recorded “You Better Run, Run, Run”. Not much is known about this recording and no publicly known copies exist. At age 25, her second set of records was recorded on May 21, 1937, under the Decca Coral label, accompanied by Estelle Allen on the piano, in order: “God’s Gonna Separate The Wheat From The Tares”, “My Lord”, “Keep Me Everyday” and “God Shall Wipe All Tears Away”. Financially, these were not successful, and Decca let her go.

In 1947, Jackson signed up with the Apollo label, and in 1948, recorded the William Herbert Brewster song “Move On Up a Little Higher”, a recording so popular stores could not stock enough copies to meet demand, selling an astonishing eight million copies. The song was later honored with the Grammy Hall of Fame Award in 1998. The success of this record sky rocketed her to fame in the U.S., and soon after, in Europe. During this time she toured as a concert artist, appearing more frequently in concert halls and less often in churches. As a consequence of this change in her venues, her arrangements expanded from piano and organ to orchestral accompaniments.

In 1950, Jackson became the first gospel singer to perform at Carnegie Hall when Joe Bostic produced the Negro Gospel and Religious Music Festival. She started touring Europe in 1952 and was hailed by critics as the “world’s greatest gospel singer”. In Paris she was called the Angel of Peace, and throughout the continent she sang to capacity audiences. The tour, however, had to be cut short due to exhaustion. She began a radio series on CBS and signed to Columbia Records in 1954. A writer for Down Beat music magazine stated on November 17, 1954: “It is generally agreed that the greatest spiritual singer now alive is Mahalia Jackson.” Her debut album for Columbia was The World’s Greatest Gospel Singer, recorded in 1954, followed by a Christmas album called Sweet Little Jesus Boy and Bless This House in 1956.

She had many notable accomplishments during this period, including her performance of many songs in the 1958 film St. Louis Blues, singing “Trouble of the World” in 1959’s Imitation of Life, and recording with Percy Faith. When she recorded The Power and the Glory with Faith, the orchestra arched their bows to honor her in solemn recognition of her great voice. She was the main attraction in the first gospel music showcase at the Newport Jazz Festival in 1957, which was organized by Joe Bostic and recorded by the Voice of America and performed again in 1958. She was also present at the opening night of Chicago’s Old Town School of Folk Music in December 1957. In 1961, she sang at John F. Kennedy’s inaugural ball. She recorded her second Christmas album Silent Night (Songs for Christmas) in 1962. By this time, she had also become a familiar face to British television viewers as a result of short films of her performing that were occasionally shown.

MahaliaEd

Ralph Abernathy and Martin Luther King, Jr. contacted her about coming to Montgomery, Alabama, to sing at a rally to raise money for the bus boycott. They also hoped she would inspire the people who were getting discouraged with the boycott.

Despite death threats, Jackson agreed to sing in Montgomery. Her concert was on December 6, 1956. By then, the U.S. Supreme Court had ruled in Browder v. Gayle that bus segregation was unconstitutional. In Montgomery, the ruling was not yet put into effect, so the bus boycott continued. At this concert she sang “I’ve Heard of a City called Heaven”, “Move On Up a Little Higher” and “Silent Night”. There was a good turnout at the concert and they were happy with the amount of money raised. However, when she returned to the Abernathy’s home, it had been bombed. The boycott finally ended on December 21, 1956, when federal injunctions were served, forcing Montgomery to comply with the court ruling.

Although Jackson was internationally known and had moved up to the northern states, she still encountered racial prejudice. One account of this was when she tried to buy a house in Chicago. Everywhere she went, the white owners and real estate agents would turn her away, claiming the house had already been sold or they changed their minds about selling. When she finally found a house, the neighbors were not happy. Shots were fired at her windows and she had to contact the police for protection. White families started moving out and black families started moving in. Everything remained the same in her neighborhood except for the skin color of the residents.

King and Abernathy continued to protest segregation. In 1957, they founded the Southern Christian Leadership Conference (SCLC). The first major event sponsored by the SCLC was the Prayer Pilgrimage for Freedom in Washington, D.C., on May 17, 1957, the third anniversary of the Brown v. Board of Education decision. From this point forward, Jackson appeared often with King, singing before his speeches and for SCLC fundraisers. In a 1962 SCLC press release, he wrote she had “appeared on numerous programs that helped the struggle in the South, but now she has indicated that she wants to be involved on a regular basis”.

At the March on Washington in 1963, Jackson sang in front of 250,000 people “How I Got Over” and “I Been ‘Buked and I Been Scorned”. Martin Luther King, Jr. made his famous “I Have a Dream” speech there. She also sang “Take My Hand, Precious Lord” at his funeral after he was assassinated in 1968. She sang to crowds at the 1964 New York World’s Fair. She toured Europe again in 1961, 1963–1964, 1967, 1968 and 1969. In 1970, she performed for Liberian President William Tubman.

Jackson’s last album was What The World Needs Now in 1969. The next year, in 1970, she and Louis Armstrong performed “Just a Closer Walk with Thee” and “When the Saints Go Marching In” together. She ended her career in 1971 with a concert in Germany, and when she returned to the U.S., made one of her final television appearances on The Flip Wilson Show. She devoted much of her time and energy to helping others. She established the Mahalia Jackson Scholarship Foundation for young people who wanted to attend college. For her efforts in helping international understanding, she received the Silver Dove Award. Chicago remained her home until the end. During her life her peak salary was $100,000.

Jackson died in Chicago on January 27, 1972 at Little Company of Mary Hospital in Evergreen Park, Illinois, of heart failure and diabetes complications. Two cities paid tribute: Chicago and New Orleans. Beginning in Chicago, outside the Greater Salem Baptist Church, 50,000 people filed silently past her mahogany, glass-topped coffin in final tribute to the queen of gospel. The next day, as many people who could—6,000 or more—filled every seat and stood along the walls of the city’s public concert hall, the Arie Crown Theater of McCormick Place, for a two-hour funeral service. Her pastor, Rev. Leon Jenkins, Mayor Richard J. Daley, and Mrs. Coretta Scott King eulogized her during the Chicago funeral as “a friend – proud, black and beautiful”. Sammy Davis, Jr., and Ella Fitzgerald paid their respects. Joseph H. Jackson, president of the National Baptist Convention, U.S.A., Inc., delivered the eulogy at the Chicago funeral. Aretha Franklin closed the Chicago rites with a moving rendition of “Precious Lord, Take My Hand”.

Three days later, a thousand miles away, the scene repeated itself: again the long lines, again the silent tribute, again the thousands filling the great hall of the Rivergate Convention Center in downtown New Orleans this time. Mayor Moon Landrieu and Louisiana Governor John J. McKeithen joined gospel singer Bessie Griffin. Dick Gregory praised Jackson’s “moral force” as the main reason for her success. Lou Rawls sang “Just a Closer Walk With Thee”. The funeral cortège of 24 limousines drove slowly past her childhood place of worship, Mt. Moriah Baptist Church, where her recordings played through loudspeakers. The procession made its way to Providence Memorial Park in Metairie, Louisiana, where she was entombed. Despite the inscription of her birth year on her gravestone as 1912, she was actually born in 1911. Among her surviving relatives is her great-nephews, NBA basketball player Danny Granger and soul artist Scotty Granger.

Jackson’s music was played widely on gospel and Christian radio stations, such as Family Radio. Her good friend Martin Luther King, Jr., said, “A voice like this one comes not once in a century, but once in a millennium.”