French President Nicolas Sarkozy and Germany Chancellor Angela Merkel said they’re “convinced” Greece will stay in the euro.

I don’t know … what else can they say?
Oh gee our whole system is about to collapse?

In reality that is what is occurring.

After the announcement for a nano second the euro gained then didn’t.

So who is expected to BAIL THEM OUT?
What financier is egg headed enough to send US dollars abroad?

OH WAIT … the Unelected, Unaccountable, Unrepentant Federal Reserve using YOUR MONEY to bail out European Commercial banks AGAIN!

The official announcement reads:

“The Governing Council of the European Central Bank (ECB) has decided, in coordination with the Federal Reserve, the Bank of England, the Bank of Japan and the Swiss National Bank, to conduct three US dollar liquidity-providing operations with a maturity of approximately three months covering the end of the year. These operations will be conducted in addition to the ongoing weekly seven-day operations announced on 10 May 2010.”

Here is the unhappy truth:

much of the funding for Europe’s banks comes from U.S. money-market funds and the interbank market. Only about 54% of their capital comes from their customers. A large amount of their capital – 33% – comes from sources that would transmit the crisis to America. The wholesale credit market in Europe comes from U.S. money-market funds. Europe’s interbank market touches major U.S. money center banks.

How will American creditors respond to the crisis?
By the end of 2012, Europe’s banks will have to refinance more than $8 trillion in wholesale funding, mostly from U.S.-based money market funds.

What if the crisis in Greece spills over into European banks? Will these lenders be willing to lend into a crisis, where there’s so little equity remaining in the books and so little political confidence in the European Central Bank?

How long did the financial movers and shakers think it would take before the people would figure out our AMERICAN DOLLAR is just about worthless?

None of this takes rocket science folks.
In fact it probably only takes an understanding of 4th grade math and 8th grade common sense.

Daily we see Europe crashing and burning.
We have a debt limit that has been reached and is now at a standstill.

Both parties and the President are playing a lethal game of chicken when THEY ALL KNOW FULL WELL we are headed for a BRICK WALL that can not be avoided.

The CODE SPEAK out of the White-house trying to con the public into thinking THEY ARE A SOLUTION as the Republicans do the same.

The ploy is simple. Let’s hope we (the government) can scare, distract and con “we the people” enough to make them think everything is hunkey dorey.

WHO CARES if Standard & Poors or Moodys drops our rate or not?
WE ARE NO LONGER CREDIT WORTHY NO MATTER WHAT THEY DO?
Our dollar worth is bogus!

I would not loan the US another dime WOULD YOU?

The ONLY MONEY WE GET IS FROM OURSELVES THROUGH THE FEDERAL RESERVE … who simply loads in a few more reams of paper and prints, prints, prints.

Here is the reality in kindergarten terms … you loan me $1,000 and I can MAYBE pay you back $100 to $220 dollars or default completely.
Does it matter that S&P or Moody’s says I have an A1 credit rate?

Europe and the US face a financial crisis.

Liu Jiayi, China’s top auditor, said in a report to the National People’s Congress that local governments had an overall debt of 10.7 trillion yuan ($1.65 trillion) by the end of 2010, and some were at risk of defaulting on payments. Countless “ghost cities” with no residents have been built by local government officials who have been long rewarded for building and development.

The Chinese government will now begin penalizing local officials who run “excessively mounted” debts.

China’s economy has already shown iffy signs.
This announcement could dramatically speed up the process.

Gold is still crawling up and closed today at $1602.40

Is this really a shock to anyone that can add and subtract?

Conference Room: White Paper Report; A-01-001 (G)
by John Wayne Sitterley, ©2011,
The American Republic Research Center

(Jun. 14, 2011) —Editor’s Note: The following work was submitted to The Post & Email and several other organizations by Mr. Sitterley. To the best of our knowledge, we are the first to publish it.

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Green Paper Report A-01-001 (G): Public Consultation Process

Operation: Limited Government: “The People’s Stimulus Package.”

Decentralize (26%) and Combine (66%) of the Federal Governmental Departments.

Authorizing Agent: The 10th Amendment of the US Constitution.

Meet the “American Republic Research Center (ARRC)”

To: Members of the 112th US Congress, State Congresses and the American People

From: American Republic Research Center (ARRC)

Ref: Threat Assessment, Decentralization, Domestic and Foreign Policy

Date: May 2011

Introduction:

Good day. I’d like to welcome and thank all of our distinguished members of the 112th United States Congress, all State Congresses, the Cabinet Secretaries, the Judiciary, Honorable Ambassadors, Diplomats and Military personnel that serve the American people throughout the world. I thank you for this opportunity to address all of you here today as a fellow citizen.

A few months ago when I was conducting interviews on a variety of websites to see what the general mood of the country is, one seaman on tour in the Pacific told me this. He said; [1] “Sir, let me put it to you like this, I am not a world citizen…I am an American citizen.” That sailor should be recommended for Annapolis, because he said more in one sentence than what all the white paper reports like this one have been trying to say for years. He gets it.

Let it be known here, now and henceforth, that the Federal Government only has those enumerated powers that the States give to it to operate as allowed by the Constitution. I quote: [2] “The powers not delegated to the United States by the Constitution, nor prohibited to it by the States, are reserved to the States respectively, or to the people.”

This report will deal in the ‘decentralization of 26% of the Federal Government’ and allocating those resources to the States, which can be managed by them in a more prudent and equitable fashion.

There has recently been a tremendous amount of interest from the American people as to the direction of our current domestic and foreign policies over the past few decades concerning the size of government, its entitlements and the unwarranted financial burden placed on her citizens. Now and in the future, policy should be in keeping with the US Constitution and the Declaration of Independence in both its domestic and foreign affairs. To give an overall guidance and approach to these recommendations, I would first like to refer to a quote from a former US Senator from Arizona by the name of Barry Goldwater. I quote:

[3]“Who will proclaim in a campaign speech, I have little interest in stream lining government or in making it more efficient, for I mean to reduce its size. I do not undertake to promote welfare, for I propose to extend freedom. My aim is not to pass laws, but to repeal them. It’s not to inaugurate new programs but to cancel old ones that do violence to the Constitution, or that have failed in their purpose, or that impose on the people an unwarranted financial burden. I will not attempt to discover whether legislation is “needed” before I have first determined whether it is constitutionally permissible. And if I should later be attacked for neglecting my constituents’ interests, I shall reply that I was informed their main interest is liberty and that in that cause I am doing the very best I can.”

I would like to now address these concerns in the first Green Paper Report intended for the “Public Consultation” process from the American Republic Research Center based in the great State of Arizona. Thank you.

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1.) The Problem: There comes a time with every civilization throughout history when Constitutional Republics like ours and the liberty on which they were founded are threatened in time by its centralization of power and the corruption that soon follows. This time is no different. Our policymakers for the last forty (40) years have been more interested in answering to the whims of the collectivist attitudes than they were to adhering to the Constitution. It is now time to restore the republic to its original founding principles and to adhere once again to those principles set forth in and in accordance with the Constitution of the United States of America and the bold body of work set forth in the Declaration of Independence and Bill of Rights.

The research provided here for future policies is more than mere suggestions. It is based on vast amounts of data and analysis with the intent to present the best course of action possible to confront all four major problem areas in current U.S. policy. This report will be recommending changes in; the economic system, decentralization of the Federal Government, domestic and foreign policy with respect to illegal immigration and radical Islam. These changes should be implemented now to run concurrently for the next five years completing the implementation process. Time grows short. If you want to see our Constitutional Republic continue as a free people, then we must act with courage today, for when we pass through the other side of this ‘economic hurricane’, and we will, it will be too late. If we do not reverse course now, the $14.3 trillion Federal debt and the Debt to GDP ratio will cripple us for decades to come.

For too long have we seen the economy falter under the tax-and-spend approach!

For too long have we seen the expansion of government based on centralizing its power and the corruption of those who are determined to control it!

For too long have we seen illegal immigrants who break the law be given amnesty and free health care at the expense of the citizen!

For too long have we seen other cultures come to this land not with the dream to learn our way of life, but rather to alter it to their own way of life which is the antithesis of our founding principles and our Constitution.

America is more than being just about the money.

America is more than just being what you can receive or benefit from it.

America is more than the rights that it guarantees.

America is more than the liberty it represents.

America is an idea. An idea which, with little effort, one can achieve their dreams. An idea where freedom, duty, honor, culture and family are more than a headline, but the very ideas that bind us together as citizens.

Ladies and gentlemen, make no mistake that America is at war. Not a Constitutionally declared war, but a war by proxy and by policy. Here…Ideology ends. Here…Reason prevails.

For those who want to change America to a collectivist state, for those who would rather sit on their laurels and not contribute anything as an individual to mankind, for those who wish to change the law of the land to a religious doctrine that opposes freedom and liberty for all…To you I say ‘go’. Go now far away from here in peace…But go.

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2.) Overview of submitting organization American Republic Research Center (ARRC): The American Republic Research Center is a start-up 501c3 non-profit, non-partisan conservative Think Tank dedicated to the writing of White Paper Reports to restore the American Republic based on research. Founded on November 3rd, 2010, ARRC has conducted extensive research in the field in the Intellectual and Cultural History of Western Civilization and American History with respect to the US Constitution. Though research for this project started in 1991, the first fifteen years being in the collection phase and the last five years in the analysis, the last two years is really when everyone started to form the group and connect worldwide with Intelligence and Diplomatic communities from a discrete website.

Founder and President of ARRC; Mr. John Wayne Sitterley, is the nephew of a delegate to US Senator Barry M. Goldwater’s 1964 Presidential campaign. John has been accredited with over 201 college credit hours in the fields of world history, art and business management. With twenty years of experience in research, John is a well-rounded academic of sound mind with many recommendations from the Intelligence and Research community. “We’re a new Think Tank but we feel our analysis and assessment is very accurate and honest.”

Mr. Sitterley was in the Boy Scouts of America in Flagstaff, Arizona and has also served in the US Army twice, once with an overseas tour of duty. John has received the Armed Forces Expeditionary, the National Defense and Achievement Medals and two honorable discharges while maintaining a ‘Secret” security clearance. Mr. Sitterley was also recommended and attended Warrant Officer Candidate School in Ft. McCoy, Wisconsin USARC in 1989 and has worked as a manager in the Petroleum industry from 2001 to 2006. John has been conducting this research and examining why America has changed over the last five decades. “I remember as a teenager some of us would walk around town with a side-arm and a hunting knife strapped to our hip. Back then no one thought much about it; they were just tools. Back then we all trusted our neighbors. Back then we were a republic.”

The Vice President of ARRC; Mr. Jeffrey Kotvas, is a “Financial Intelligence Analyst” for VITTS Think Tank with over 20 years of experience investigating financial fraud, money laundering, government corruption, and terrorist financing. He is active with the United Nations Global Alliance for ICT, Development, and collaborates with the Center for Strategic and International Studies, project on Government Oversight, Council on Foreign Relations and the Center for Security Studies. Mr. Kotvas is also versed in governmental policies, procedures and guidelines in grant writing for non-profit organizations. His management skills are in the area of ‘Research and Development’ and he frequently flies to the Middle-East and Washington, DC to collect, analyze and disseminate vital information. His work and insight have earned him the respect of his Fellows and colleagues alike from his grasp of retaining a very large array of detailed analysis that covers many disciplines of academia.

The Treasurer of ARRC; Thomas J. Zaleski, is one of the rising new stars in the current Republican movement that holds a vision so rarely seen in the world of politics. Young, thoughtful and vivacious, Thomas has also had a long acquaintance as a student and friend of the renowned conservative intellectual Mr. William F. Buckley Jr. for over thirty (30) years, who drew national attention with his book, “God and Man at Yale” in 1951; his hit television show, “Firing Line,” and helped found the “National Review” magazine.

Recently in 2010 Mr. Zaleski gave a respectable showing as a strong conservative candidate for the Arizona House of Representatives. His high degree of integrity, coupled with a Bachelor of Arts and Bachelor of Science Degrees in Finance and Economics, gives Thomas a commanding lead far surpassing the knowledge of many other candidates in his expertise in economics. Such knowledge has also afforded him to gain experience in working for such companies such as Hughes Aircraft, Smith Barney, Wells Fargo Securities and Morgan Stanley in Tucson, Arizona. Mr. Zaleski now runs his own office in Northern Arizona with his wife and children.

Secretary of ARRC; Mr. Lloyd Wedes finds research, both theoretical and applied, to be his forte. While with the State of Texas, building contacts and extending project services with State, Community, and Private groups, he initiated and investigated the methods and policies used in State and Federally-funded programs and, later teaming with the other agencies of interest, rehabilitated State and Federal agency procedures and worked to successfully reallocate targeted funding that previously cost taxpayers hundreds of millions of dollars a year in the Houston region alone. A trusted source and reliable partner, the State of Texas later invited him in probes relating to another State agency with similar successful outcomes.

On the more pastoral side of his work, Mr. Wedes graduated with a Master’s in Library Science at the top of his class and overall graduate ranking of 1 of 449. He built selected information collections for institutions such as the Vatican, the House of Windsor, and several world leaders. He now is involved in academic librarianship and also develops online tutorials and resources for university campuses in the US and Canada. He has plans to continue building private collections through his Touch and Go Library and Information Services (TAGLIS).

He has traveled throughout Europe and parts of the Middle East, where he has met with leaders in Government, Education, and related fields.

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3. Overview of Proposed Policy: The major objective will be to: Define the threats to America, Decentralize (4) Cabinets (26%), Combine (66%) and ‘decrease Programs and increase Infrastructure by decreasing the budget by 20% & outline Domestic and Foreign Policy.

On Threat Assessment: Ladies and gentlemen, make no mistake that America is at war. Not a Constitutionally declared war, but a war by policy that threatens America not on one front, but on four fronts. These fronts are; (1) Economic, (2) world socialism, (3) conquer by illegal immigration, and (4) radical Islam. These are the threats to America.

On Decentralization:

Departments to be allocated to the State level, ‘combined, decentralized and defunded’ 20% yearly for five (5) years are:

1 Department of Labor and Housing Development; and

2. Department of Health, Education & Human Services

Departments combined and remain at the Federal level with 20% modifications are:

1. Department of Defense and Veteran Affairs

2. Department of Energy and Transportation

3. Department of Interior and Agriculture

Departments to remain the same with 10%-20% modifications:

1. Department of State

2. Department of Treasury

3. Department of Commerce

4. Department of Justice/Attorney General

5. Department of Homeland Security

*Modifications will be known, and understood, as defunding of’ programs [to be ascertained later] and the increasing of ‘infrastructure’. All departments will reduce their staff, funding and programs by 20%. The Departments allocated to the States will reduce the same 20% and decrease their federal funding by 20% over a five-year period and “capped” in all State budgets not to exceed $100 million per department per State. [$10 billion total for all 50 States per year. This alone will save the taxpayer approximately $758.2 billion per year by allocating these departments to the States].

On Domestic Policy: The one sole criterion for ‘domestic policy’ will be to extend freedom and to promote the individual over the collective. A level playing field never creates freedom. Why? Because as soon as you make a level playing field your sole criterion will then be to create an agency, commission or committee to restrict the freedom of others through laws, policies and regulations. Our purpose is to extend freedom and not to limit it. Our sole criterion for ‘domestic policy’ is to promote the individual over the collective in accordance with the US Constitution.

On Foreign Policy: The sole criterion for ‘foreign policy’ is to support current and/or emerging democracies around the world in accordance with the US Constitution and the Declaration of Independence and not to support totalitarian regimes. Help our friends, not our enemies.

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Other Concerning Points of Interest to the American people: For it is the honor and duty of every American soldier and citizen to protect and defend the Constitution of the United States by oath or by decree, and not of business interests that have failed or have bad management or do damage to the Constitution, the military or the people of the United States.

If big business with international interests ever gets themselves in a precarious situation abroad, then they should reevaluate their policy and their management. America’s sons and daughters do not fight for business empires; they fight to preserve the Constitution, and please don’t you ever forget it.

All lands within the US borders and interior will be the sole domain of her citizens and government herein and not be sold to foreign interests or governments. Those lands that have been sold will revert back to the property of the United States by “Security Domain Laws.”

All gold and precious metals mined in the United States will remain the property of the United States and not sold to foreign governments or be used to pay down foreign debt.

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4) Policy Activities & Timeline:

The guidelines we propose here today, and after 20 years of research, is to define the current enemies of America that mean or do harm to the American people and/or the Constitution of the United States, and also to offer solutions for the survivability of the Republic and to make policy in accordance with the Constitution of the United States. The Implementation process should take no more than five (5) years to complete once enacted.

Threat Assessment: Concerning the War on Four (4) Fronts as current threats to America and their solutions herein are as follows:

Problem……………………………. Solution

1. Economic……………………..Switch to [5] Austrian or Chicago School of Economics. Those economists familiar with these schools of thought will be hired at the US Department of Treasury, The Federal Reserve, The International Monetary Fund (IMF) and the World Bank. A process to “decentralize” the banking community should also take place and have a plan of action for such within a one-year period.

2. Conquer by Migration……Decentralize Government. First we will ask all illegal immigrants to leave on their own accord. Those who don’t will be charged with a criminal offense and will stand trial. No amnesty will be offered to them. To fix our broken borders, Sheriff Babeu would like the ten-point border security plan proposed by Arizona’s Senator Jon Kyl implemented. Those who cannot achieve legal immigrant status will not receive health care or any other entitlement of welfare at the public expense. By decentralizing, this action allows the respective States to address their issues in a timely manner.

Concerning “Conquer by Illegal Immigration,’ groups like Aztlan and La Raza are determined to reclaim the Old Spanish Territory which was ceded to America as a “complete and total-surrendered” of all previously-held lands soon after hostilities from the Mexican-American War of 1846-48. The “Guadeloupe Treaty of Hidalgo,” of which millions of dollars were paid as concessions to the local inhabitants after the war, and the Gadsden Purchase secured the lands of the Southwest as American soil. All public funding and assistance to these organizations like Aztlan and La Raza should cease immediately.

In related threat assessments, in the last twenty years America’s crime rate has raised 65% due to illegal immigrants with a cost in the billions to process, house, hold trials and detain through the criminal justice system. Mexico’s drug cartels and Hezbollah, which has been reported to having a base around Tijuana, Mexico, have teamed up to establish anti-Western Muslim communities while aiding the drug cartels in their shipments of drugs and arms into North America. Human smuggling operations also still persist to this day ranging in the tens of millions of illegal immigrants that have crossed over our border. Though the numbers indicate that some are returning back home due to the economic environment in America presently, there are estimates of about 12-18 million illegals still living in the United States and a large portion of them are using public assistance programs and health care at the cost of about $120 billion dollars per year.

There is also an issue that gets very little attention but has grave consequences, which is the crime, rape and abduction of the American woman. The enemies of America since 1945 know that they cannot beat us on the battlefield. In the effort to eliminate the ‘white America’ of the 50′s and 60′s, the American woman’s “womb” has become the new battlefield to conquer by migration. The rape and forced marriages from illegal immigrants and Muslims from the Middle East on the American woman is shameful at best. The reluctance of all past administrations in the last fifty years to deal with the “white slave trade” in its selling and abductions of the American woman on the “black-market” is an absolute travesty against her citizens. The Natalee Holloway case in Aruba only touched on the surface of this problem during the investigation but quickly faded back into the darkness. This appears to be the new strategic policy from our enemies to conquer this country. Even the Department of State has made May 24th “National Missing Children’s Day.” Yet, Obama’s immigration reforms and blanket amnesty contribute in this elimination of American culture and her people all in the name of politics. If all of these acts were voluntary, there would be no problem, but they are not. These women are coerced, kidnapped and abducted.

There are millions of rapes by illegals in the last thirty years while hundreds of thousands of women are taken off the streets of America and sent to harems across the Middle East, North Africa, Rome, Costa Rica, Japan and South America. These women are forced or coerced by drugs into working in international prostitution rings that go largely unreported. This is a worldwide problem. Untold numbers of young women from the Kosovo area, ranging in the thousands, were seeking refuge in the 90’s but instead were then brought and sold into Italy by their Hungarian handlers. Why does the American woman and civil rights groups allow this to be a non-issue? Is the American woman being used to support a “one world, one race” agenda prevalent in the socialist ideology? (Source: NCIC)

3. World Socialism in U.S….Decentralize Government/Empower the States. Many transgressions against freedom and liberty have been noted, and the base of those transgressions whose aim is to export world socialism can be found coming from the “Frankfurt School” in Frankfurt, Germany from the 1920’s onward. These transgressions include the teachings of “revisionist history” and “political correctness,” which means to destroy capitalism and promote the collective over the individual by changing our history and making a ‘level’ playing field.

Decentralizing “central planning” and instituting a free-market economic system are the best methods to reverse this course of totalitarianism and reinstitute the rule of law in accordance with the Constitution of the United States. It is with firm belief that all other methods of good intention will have no effect. Decentralizing is our only real option. Any other option is fruitless and will prove to be a waste of time and money.

4. Radical Islam………………..Decentralize Government/ The United States Southwestern border and its Northern border along Canada are entry points for illegals and terrorists alike. According to Immigration Studies, 0.1% of those listed as OTM (other than Mexicans) who have come across the border are from the Middle East, with 11% being from a variety of other countries. The Islamic Resistance has also set up bases of operations in Mezzo and South America which work in conjunction with the drug cartels and establish anti-Western Muslim communities. Usually these communities are located in remote areas where the borders of a few countries come together which allows them to operate freely and to escape justice from one country’s law enforcement agencies by slipping back across the border into another country’s border.

The Islamic Resistance and the Muslim Brotherhood (IR/MB) compose radical Islam. They have set claim to all parts of the world to install Shar’ia law and receive a bulk of their funding from the drug trade grown and processed in the Middle-East.

This is a fact.

With Iran already acting as a ‘home base’ for the IR, The MB (the more radical of the two) is establishing its ‘home base’ in Egypt (overcoming the ‘reformers’ to establish their agenda, which as a result, we may very well see their last free election after this year). Libya, Yemen, Bahrain and Syria are following suit. Soon, Saudi Arabia and India must act as liberators of the area or perish. People…This is ‘gang warfare’ on a global scale.

Historical Note: Concerning the Palestinians from Ancient History: There are accounts in ancient history from Egyptians and the Hellenes of a group of pirates that oared and sailed throughout the Mediterranean without a homeland and robbed other vessels of their cargo. They were simply known as [4] “the boat people” in most accounts throughout history. There was also a group of people known as the Philistines which had their homeland right where Palestine is today. It is believed that many tribes of the region to include the boat people assimilated with the Philistines and other tribes to become known as the Palestinians. They occupy the same strip of land that the Philistines once occupied, the Gaza Strip.

Cultural Note: “A good society reflects the good side of human nature. If human nature has a dark side as base emotion, then reason and culture were created to be its antithesis. Rise to the level of your culture, for culture never stoops. This is the division between the subculture and the main culture. Subculture has no culture, for it is just the base of human emotional romanticism in its various forms of expressions. Reason reigns superior in a high culture in the classic sense.”

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The Hypothesis: The whole of the ME (Middle East) is exploding. The main reason on why the Israel-Palestine/Arab conflict has not resolved itself is that most think that it is “about the land.” It is not abut the land. If you think it is about the land you will fail like all other predecessors before and as other envoys have. You cannot judge this with a Western mind. You have to see it through their eyes, and their eyes do not accept their Israeli brother.

The solution to that problem is simple. Israel’s culture is based in freedom and free will, while the Islamic culture is based on pre-destiny and servitude. This is the base for Islam’s absolute refusal to except Israel’s “Right to Exist.” Since 622 AD, Mohammed and his followers are sworn to eliminate the Israeli before “the end of days.”

Radical Islam is a “highly constrained” society very similar to the Nazis and the Ku Klux Klan all rolled into one. This is “religious socialism” of a totalitarian state in the highest degree.

What is taking shape is that there are some people of the Middle East who are beginning to commit to their freedom and liberty for reforms and accept Israel as a State. “They” must be the ones who secure their country. No one else can do this for them. No one else can give this to the Persian or the Arab. Freedom must be paid for by their “blood and treasure.” They must earn it. It is their fight. They’ve been fighting for over 1,400 years…Let them fight it.

Points of Concern:

1. The reform movement may not be anywhere close to that of reform movements in the West [i.e. religious tolerance], although reports are that corruption is high on their list.

2. The ‘reform movements’ in the ME stand a pretty good chance of being taken over by the MB in short order as we are seeing in Egypt. The bottom line is that this is a conflict of visions with freedom as set forth in ‘Deuteronomy,’ or that of servitude as set forth in “Shar’ia.”

3. Frankly, the radical Middle East does not want the West in their land. Frankly, we don’t much care for them in our land, either. They have been pawns in the ‘great game’ for a long time and are tired of it. We should be protecting our own borders as per the Constitution. The cost of “nation building” in the region is in the billions of dollars and cannot be sustained indefinitely, nor is it our business to do so. Our “blood and treasure” should be used to protect our borders and not everyone else’s who have never had a democracy. Israel is the only exception in the region to defend and support. They alone are the beachhead of Western civilization.

4. The real issue in the ‘great game’ is threefold; Israel, Radical Islam acquiring an Atomic Bomb and the oil reserves in the ME vs. the oil reserves in Russia in selling their product to the West and to China, which is heavily invested in the Sudan with the Kashmir road to obtain it.

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Recommendation (Foreign): It is recommended that; 1. America and the coalition forces “Pull back or Pull out” [since Osama bin Laden is now dead] and support Israel with a fleet and supplies. As policy has changed from “the Hearts and Minds” to “Learn and Adapt,” here, too, the “War on Terror” should switch to “the War on Radical Islam,” as in total war, preferably led by Generals and not politicians. 2. We must reduce all regulations in the US to drill for our own domestic oil while developing alternative energy means such as natural gas and cease buying Middle-Eastern oil and acquire Russian oil contracts, for there is more of a historical orthodox and cultural relationship there with them than with the East. 3. The ‘true-reform movement’ of the M.E. is given support through the ‘private-sector,’ not government, as humanitarian aid throughout the Middle East, and 4. Since Israel cannot survive even one atomic blast, and also since the main issue is Israel’s ‘right to exist,’ Saudi Arabia and India must act as liberators and make their move to eliminate the Islamic Resistance and the Muslim Brotherhood’s top leadership and their ability to acquire a nuclear weapon. Why? Because it is in their best interests to restore the ‘balance of power’ and sustain their area of influence. If radical Islam succeeds, Saudi Arabia and eventually India fall. India should also be allowed to act in her best interest in Kashmir, Nepal and Bangladesh.

Recommendation (Domestic): These problems are too great for any one department or agency to handle. Here too, the “War on Terror” should switch to “the War on Radical Islam,” as in total war, preferably led by Generals and not politicians. Along with electronic surveillance, the whole of the American people and the military must be utilized to help collect intelligence at the local level on suspected illegal and terrorist cells. Organized units of citizens of these United States should be allowed to form and operate as units as a ‘Civil Defense Corps/Civil Air Patrol’ or “State Guard/Ranger” units numbering no more than 50,000 total [1,000 per State] to be under the control of the Governor of each State and to work in conjunction with the State’s National Guard Units and/or independently under the direction of the Mayors as a voluntary service in their respective municipalities recruited from the general public, law enforcement, the VFW (Veterans of Foreign Wars) and the AL (American Legion). Local law enforcement will initiate investigations brought forth to them and bring the suspected illegals and terrorist cells to justice.

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Notes of Importance 1: Concerning worldwide events, there are ‘two common threads’ which run through all of these movements. One thread is “corruption,” while the second thread, for lack of a better term, is “religious socialism” bent on world conquest. Now whether one’s political vision is based on ‘Deuteronomy’ or on ‘Shar’ia’, servitude, corruption and world dominance through religion is the sole propose to create a Caliphate in the West. Will you fight or submit?

This is a clash between Eastern and Western Civilization. With this knowledge, what analysis can we deduce from it? With Iran already acting as a ‘home base’ for the IR, The MB (the more radical of the two) is establishing its ‘home base’ in Egypt (which is overcoming the ‘reformers’ to establish their agenda, which as a result, we may very well see their last free election after this year). Libya, Yemen, Bahrain and Syria are following suit. People…This is ‘gang-warfare’ with a purpose on a global scale. Once their home base is secure, the “war on terror” will go from 9mm to 500-pounders within a year if the people in the reform movements and newly- trained Armies of the Middle East fail.

Notes of Importance 2: Thus, Saudi Arabia and India now need to assert their will and influence to reduce the possible threat from radical Islam in the region. America and Britain need to step back into a defensive posture near Israel. The result of this action will be that Saudi Arabia will gain the “balance of power” in the region since Egypt is in the process of losing it and thus, the Saudis will become a closer ally to Israel. The Saudis will also be credited with liberating the people of Persia. India must also move to acquire the Kashmir Road and remove the Maoists from Nepal and Bangladesh. Yes, the area will become more fluid, but the outcome will be more advantageous much more quickly for those who believe in Western Civilization. The United States would be much more in line with the Constitution by supporting democracies through the private sector in humanitarian aid and our military in a supporting role for those democracies that are now given a chance to gain their own freedom.

Concerning China: While China has absorbed our 2 trillion dollar US debt and is expanding its Naval fleets into larger areas of operation, they are also invested in $970 billion in Bills at the US Treasury, buying US mineral rights, and using “cyber attacks” against US businesses, defense contractors and governmental departments.

Concerning American Territories, we recommend that America release Guam, Samoa and Puerto Rico as territories and transfer our bases over to, say, the Australians. Billions of dollars can be saved from this “dependency relationship” and these territories would be given a chance to create their own free and independent sovereign states. The thousands of American personnel and equipment can be brought back home to aid in the fight against radical Islam in this country.

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Concerning Decentralization as a Solution in Detail:

Proposed Hypothesis: U.S. Cabinet Departments (15 to (Proposed)

A. FEDERAL LEVEL (Combined and Reduced)

Department of State; (Reduce staff 10%) Eliminate all Foreign Aid and make it a voluntary process.

Department of the Treasury; (Reduce staff, funding and programs by 20% and adopt a free-market Economic System of Austrian and/or Chicago School of Economics. This will also be required for the Federal Reserve, the World Bank and the IMF (International Monetary Fund).

Department of Defense and Veteran Affairs; (Reduce 20% in contracts and budget)

a. Base Review outside US to release Puerto Rico, Samoa and Guam as Territories.

b. Coast Guard will become a Full Military Branch assigned to the DHS.

c. Military veterans in their respective States may register to form a ‘Civil Defense Corps or State Guard’ under the jurisdiction of the Governor and may apply to be recalled for full-time service in the federal or state military after meeting requirements, wherever that service or veteran deems the most valuable for their field of expertise in a ‘support role.’

d. All citizens between the ages of 18-49 years must serve at least two years in the US Military or a local, state or federal Community Service Program.

Department of Justice: Attorney General; (Reduce staff, funding and programs by 20%)

Department of Energy and Transportation; (Reduce staff, funding and programs 20%)

Department of Interior & Agriculture (Reduce staff, funding and programs 20%)

Department of Homeland Security

(Combine all 16 Intelligence Agencies, the US Coast Guard and FEMA)

(3 tier) NSA…………FBI, DIA, CIA, ……….All others respective.

Department of Commerce (Reduce staff, funding and programs by 20%)

B. STATE LEVEL (Combine) Allocate to State level with budget not to exceed $100 Million dollars for each department for each State after five years. These departments will be administered by the governor and reports sent to the OMB (Office of Management and Budget). The major objective will be to ‘decrease Programs and increase Infrastructure’ within the budgetary process.

Department of Labor and Housing Development; for each State (Reduce staff, funding and programs 20% each year for five years)

Department of Health, Education & Human Services; for each State (Reduce staff, funding and programs 20% each year for five years) For welfare recipients; a WPA (Works Project Admin.) type of program will be set up in each State and require local work for payment if applicable in the city they reside. Each recipient must be drug-free.

Education department at the State level is just a good idea. Not only will the teaching of the Constitution and the Pledge of Allegiance take place, but majority and minority communities can see the direct support their education centers in the receiving of their tax dollars instead of it being sent to another part of the country for someone else’s kids. Education begins at home.

C. ABOLISH; All Unions from All Government Service.

D. Reduce UN Funding from 22% to 12%.

E. United States will establish a ‘Flat-Tax’ of 12% for all her working citizens to maintain the Federal government. A State “Flat-tax” rate may vary from State to State.

F. Reduce all governmental agencies which are duplicate agencies or do violence to the Constitution from 2000+ agencies to 1000 agencies and capped.

G. Eliminate free health care and entitlements for illegal immigrants.

H. Reduce all paperwork to only one hundred (100) forms for each department.

I. Law must be written by congressmen/women and cannot be more than ten (10) pages long and stated in simple language with no ‘earmarks’ or ‘pork.’

Timeline: A timeline of five (5) years should be effective immediately upon passing in Congress. Funding for these departments being allocated to the State level will be reduced over the next five years concurrently with a reduction of Federal funding of 20% each year for the next five years to be part of its implementation process. To comply within the respective States’ budgets, programs will need to be eliminated from the department’s budget.

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5. Outcomes from Domestic Policy: There are two outcomes from these changes. One is to deeply curtail our spending which directly affects our debt that burdens the American people, and two, to empower the States to better serve their citizens in a time of crisis by providing a quicker response time in the case of a national emergency, and by serving the citizens in a much more productive, prudent and equitable fashion.

What is expected to be achieved here, since many liberal polices have not been challenged in the past to the degree to which they should have been, is that these policy changes, once implemented, will act in the spirit of “circling the wagons.” By empowering the States in accordance with the 10th Amendment and using the power of “nullification,” those States will be able to review, implement, cancel, revise and evaluate policy with respect to the needs of their respective state, county and municipality for the local citizenry while maintaining a balanced budget.

a. The reason for a “WPA”-type of community service program in Human Services is that nothing retains a person’s dignity better than them earning the money they receive. The community as a whole is rewarded by their service.

b. The reason for the “State Guard/Civil Defense Corps” is that they can help aid Law Enforcement, Border Patrol and the National Guard in times of state and/or national emergencies on the local level since they alone know the area, terrain and the people better.

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6. Evaluations of Domestic Policy: The evaluation of policy will be done by the Office of Management and Budget (OMB) located in Washington, D.C. It is recommended that the OMB increase its staffing from the current 500 to 525 to review and ensure future policies from the States are in accordance with the Constitution of the United States of America. Concerns from the Federal government to the States my also be directed to evaluate policy and to ensure that they are in compliance with the Constitution. [Added Cost to OMB: $1,125,000/yr.]

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7. Funding of Domestic Policy: There will be no funding needed for this project. We estimate that the project will save the American taxpayer will over $1.2 Trillion dollars, (approx.; $1,200,000,000,000) by the end of its five-year implementation process by decentralizing four (4) departments and reducing all the combined departmental programs by 10%-20% alone.

ARRC Analysis of Various Government Budgets (Work-in-Progress):

Note: Current Foreign Aid: [6] $44.9 billion. [a. Military; $11 billion b. Economic/USAID; $33.9 billion]. [Mil=24%, Econ=42.6%, USAID=33%.] Separately, Private Assistance is now $24.2 billion, making total Foreign Aid $69.1 billion. By eliminating Foreign Aid in the government, the private-sector, such as business entrepreneurs, church groups, political action committees and citizens that wish to contribute freely may do so, thus, making it wholly dependent on the individual and therefore not required from the collective as per our Constitution and in accordance with our outline of foreign policy.

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A). Recommended ARRC Budget: Federal level:

Current Budget………………..Reduced 20%………………………..New Budget

Department of State:

DOS; $53.8 billion……..Foreign Aid ($44.9 billion)……………. $00.0 billion

………………………………………. ($0.10) billion……………$8.1 billion

Department of Defense and Veteran Affairs:

DOD; $548.9 billion………………… ($109.78) billion………..$439.12 billion

DoVA; $68.5 billion……………… ($13.7) billion……………..$54.8 billion

Sub-Total……………………………………………………….…$493.92 billion

Department of Justice:

DOJ; $31.0 billion…………………($6.20) billion………….……..$24.8 billion

Department of Commerce:

DoC; $9.2 billion……………………($1.84) billion…………..……$7.36 billion

Department of Energy and Transportation:

DoET; $31.1/$75.3 billion…………..($6.22/$15.6) billion..$24.8/$59.75 billion

Sub-Total…………………………………………………………….$84.55 billion

Department of Interior and Agriculture:

DoIA; $13.0/ag$132.2 billion……..($2.6/ag$26.44) billion…….$10.4/ag105.76 billion

Sub-Total……………………………………………………………….$116.16 billion

Department of Homeland Security:

DHS; $53.6 billion……………..…($10.72) billion…………………….$42.88 billion

Department of Treasury:

DoTr; $79.6 billion………………..($15.92) billion……………………$63.68 billion

Subtotal Federal…………………………………………………………..$841.45 billion

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B). Recommended ARRC Budget: The Departments Allocated to the State level;

The Federal sum will reduce yearly by – (207.94) billion/year for five years

Current Budget………………..Reduced 20%………………………..New Budget

Department of Health, Education and Human Services:

DoHEHS; $818.0/ed$71.5 billion…(163.6/ed$14.3) billion………$654.4/ed$57.2 billion

Sub-Total (88%)…………………………………………………….………$711.6 billion

Department of Labor, Housing and Urban Development:

DoLHUD; $102.7/$47.5 billion……($20.54/hud$9.5)………..….$82.16/hud$38.0 billion

Sub-Total (12%)……………………………………………………..…….$120.16 billion

Sub-Total Allocated to the States…..………………………1st year……$831.76 billion

……………………………………………………………..…2nd year……$623.82 billion

………………………………………………………………..3rd year……$415.88 billion

……………………………………………………………….4th year…….$207.94 billion

……………………………………………………………….5th year…….$000.00 billion

_______________________________________________________________________

Grand Total Federal and State…………………………………………$1,683.51 trillion

Grand Total Federal Budget after five (5) years… (1981 level)….………$841.45 billion

Work in progress; Posted as they become available)

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References:

[1] Seamen Sparks; US Navy (Classified)

[2]: The 10th Amendment; the United States Bill of Rights.

[3]: Quote: U.S. Senator Barry M. Goldwater (R) Arizona (1909-1998) “Conscience of a Conservative,” BN Publishing, 1962/2007 p 17.

[4] Ref. source: “The Intellectual and Cultural History of the Western World” Barnes, 1937, Vol. I., Dover Press

[5] Ibid “The Road to Serfdom”, F.A. Hayek; (1899-1992) 1944, Univ. of Chicago Press

[6] The ‘Greenbook’ and the ‘Hoover Institute’

© 2011: American Republic Research Center (ARRC); All Rights Reserved.

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In my life time I have never see such a horrible job done by the Federal Reserve than has been done in the last decade. It first started with Alan Greenspan’s intentional sabotage of the final years of the Bush Administration. By keeping the federal fund rate at 1% while the housing bubble rose to catastrophic proportions Mr. Greenspan guaranteed disaster. The opposite reaction he had in 1989 to 1991 during the Savings and Loan crisis. Now we have Time’s “Man of the Year” Ben Bernanke completely blow up the Federal Reserve. With Bernanke’s actions we are almost assured of depression with inflation.

Ben Bernanke Federal Reserve Chairman

Mr. Greenspan’s famous “irrational exuberance” quote was in 1997 concerning the NASDAQ bubble. He missed the peak by three years.

Basically for the banking industry a central bank, like the Federal Reserve, decides to print more money than the year before. This can be 5% to 120%. Most economist feel a modest inflation rate is desirable because it “lubricates” the economy. This is a fancy way of saying a employer can have a price cut or wage cut without changing anything. Just keep the prices on the menu the same for the next year or someone’s wage. If the inflation rate is predictable and modest business can easily adjust and plan future activities.

Where the devious part comes in is what is known as “Keynesian” economics which is what the current administration is practicing on the economy. John Maynard Keynes was an economist for FDR in the 30’s and 40’s. He came up with “priming the pump” and other nonsense that Nancy Pelosi spews to this day. His basic belief was that the federal government should continually increase spending “tricking” manufacturers into producing more than they would have in the belief that they were too stupid to realize the money stock was becoming devalued. This meant basically paying manufacturers with devalued dollars. The problem is this method builds distrust as was seen in the 1960’s and pretty soon everyone from producers to the unions automatically assume there will be more inflation than anticipated and contracts are adjusted accordingly. The federal government has to spend an ever increasing amount to “trick” manufacturers and a vicious cycle is created triggering inflation.

But let’s assume the only ones who know that the money supply was increased were the insiders at the Federal Reserve in New York. These guys are buddies with their pals at Goldman Sacks. They socialize at the finest New York restaurants, date, marry, play softball and intermingle. The Federal Reserve guys tell the Goldman Sacks guys what is happening on the Open Market Committee and with the Federal Reserve Chairman. Secrets don’t last long when there’s money to be made. So the Goldman employees know to buy now with valuable dollars before they depreciate. The same holds true for bankers. The bubble occurs and no one knows exactly when it will burst but it will. So the inside crowd sells off assets sometimes to soon or on time but they do sell off. And the public is left holding worthless assets. That’s how it’s supposed to work which is why we have a Federal Reserve and not “Free Banking”. Corruption and greed. This last housing bubble didn’t quite work out that way which is the real reason Bush Treasury Secretary Paulson freaked out and got the bail out billions to pay off a bunch of pissed off investment bankers.

And now we are in a dollar bubble just waiting to burst. Its 1931, 10% unemployment, bad economy and for the most part blissfully ignorant of how bad it will get in the coming years. And there is the federal government doing everything wrong. Printing money, buying unproductive junk, producing temporary jobs. Basically moving more and more of the economies resources from the productive sector to the unproductive sector. All the while increasing taxes and further retarding growth. And to top it off proposing new trillion dollar programs that add uncertainty to the business community. This is going to be a big fall.

The main point is that we don’t need a Federal Reserve. In the past banks would print their own notes and back them with gold, silver or even regional bank notes. So why do we have a Federal Reserve setting interest rates and exploding the money supply? It makes no sense.

One of the reforms that will need to occur if America is to remain viable is to strip the Federal Reserve of all it powers except as a partner to assist with bankrupt banks. We don’t need it. The damage far outweighs the benefit. We need to have a “Free Banking” movement in the United States and get back to “hard money” banking policies.

In the past I have supported the Federal Reserve because for most of my life from 1981 to 2001 it was rational and generally respectable in its operations. Wow was I ever wrong. Time to get back to Andrew Jackson’s values and the idea of killing the federal bank for another 77 years or so.

As has been pointed out by myself and many economists the Federal Reserve is dramatically increasing the monetary base. What does this mean? If the Great Depression is indicator inflation with high unemployment as the federal government continues to “crowd out” the private sector in its insatiable appetite for good and services. The ultimate end game is fascist control over the economy like that which occurred in America and Germany in the 1930’s.

Monetary Base

And that is the goal “equality” and power. Everyone knows the scenario. Thanks to Glen Beck and Neal Cavuto if people want it they can get a pretty decent overview of the game plan of the fascist. None of this is new. What will we do about it?

At a recent political gathering I was asked about the Federal Reserve and its function. Alex Jones and his crowd have been demonizing the Federal Reserve and is a proponent of putting the Fed under congressional control. This would be the worst possible scenario possible. Congress would print and spend every election cycle.

The gold standard? A lot of economist favor going back to the gold standard. And it has its merits. The problem though is you are tied to gold so as the commodity, like all commodities, gyrates up and down against the world of currencies your imports and exports gyrate along with the currency. When gold is high imports are cheap and exporting industries are hurt. When gold is low exports are helped and imports expensive. Not the most stable position for a country to be in.

MZM Money Stock. Did you get a 20% raise in 2008?

Finally if the Federal Reserve is to be maintained congress should restrict its operations. Set the reserve requirement once and print money at say 4% increase plus or minus 1%. No fed funds, no discount window. Remove the Federal Reserve from all functions except to increase the money supply 4% in good times and bad.

My 2 cents on the Federal Reserve. Also according to these Federal Reserve charts the inflation rate looks to be going to 20%. What a shocker. The inflation rate during the FDR years varied on various commodities about 10% to 15%. Hmmmm. Are these guys that good?

As I watch Glen Beck on television and radio personality Robert D. Raiford of the John Boy and Billy show struggle with economics and the different messages they get from economic “experts” I will struggled to explain in layman’s terms as best I can. What is really going on with all these economics and why the information is so different from one source to the next? I will do my best to make what is occurring as clear as possible.

Glen Beck struggles with the concept of the Federal Reserve and its Chairman Ben Bernanke printing trillions of dollars and the inflationary damage it will do to the economy. To understand his motivations it’s necessary to go back in time to the Great Depression and John Maynard Keynes.

During the 1920’s the stock market had a huge bubble as we all know that burst in 1929. Everyone blames the Great Depression on the stock market. But for Mr. Bernanke and thousands of economists we know that’s false. Government actions make a routine cyclical recession into a worldwide depression eventually leading to the rise of Hitler and WWII. The average unemployment rate under Roosevelt in the 1930′s was a catastrophic 17.2%! One of the great if not the greatest tragedy in human existence only rivaled by the Black Death that swept the world several times in the 1340’s, killing 30 to 60% of Europeans as well as the 17th and 18th century plagues. Unlike the plague the depression and world war was totally man made catastrophes.

What the government did to make a regular cyclical recession into disaster was three huge blunders. On the federal level Hoover and Roosevelt raised taxes on the rich from 25% to 63% then Roosevelt to 79%. Sound familiar? Hoover increased federal spending 55% on various government projects like the Hoover Dam. Sound familiar? George Bush did the same with the wars, education and drug programs for seniors. Roosevelt further increased federal spending with his New Deal programs, increased business regulation and increased taxes on the wealthy. Sound familiar? Hoover raised tariffs 41.5%. Sound familiar? Obama was battling it out in the primaries bragging he could raise tariffs the fastest. It’s as if Bush and Obama are following the script of Hoover and Roosevelt to a T.

And one aspect that is lost in all this is the Federal Reserve did some truly asinine moves with the money supply. When the recession hit the Fed decreased the money supply 27%! Ouch! The exact opposite of what should have been done. Later in 1937 the Fed doubled the reserve requirement again throwing the country into depression. Monumental blunders that were not lost on Bernanke who studied the Great Depression during his college years.

Bernanke is determined not to repeat the blunders of the past but is going in the opposite direction with a vengeance. And here is where economist differs in their approaches.

Bernanke and democrats in general are students of John Maynard Keynes the great Leviathan economist during the 1930’s and 40’s. These Keynesian economists believe, although they will deny it, that government and people of superior intelligence such as themselves are equipped to deal with all the economic problems of the world. Super smart people like Bernie Madoff, Chuck Schumer, Michael Milken, Bernard Ebbers, Dennis Kozlowski, and Kenneth Lay from all walks of life feel entitled to rip off or impose government policies on people because they all have a underlying contempt for the unwashed masses. They feel superior and entitled to power and privilege.

John Maynard Keynes was fond of tapping his two fingers on the desk when conducting business hearings during WWII when contractors begged for government approval to raise prices to keep up with ramped inflation that was occurring on the black market of the time. The money supply was up 121% but inflation must have been a figment of these contractors’ imaginations. The finger tap on the desk literally represented his signal to his colleges that the head ant on top of the hill was signaling with his antennas to his comrades below that the shit was about to roll down hill. In other words he thought the person pleading was full of shit. This disrespect for contractors and their companies is blatantly apparent to readers of Keynes. And that is why so many politicians are drawn to Keynes. Central planning and a feeling of superiority and privilege over the stupid ignorant masses that are too stupid to see the big picture.

Radio personality Robert D. Raiford complains of Keynes “paradox of thrift.” Essentially this theory states that if we all save our money it may be personally good for us as individuals but is bad for the economy. Raiford, a highly educated man with a master’s degree, must have received some pretty bias economic education and like millions of Americans struggles with even the most basic understanding of the subject. The problem with Keynes is his theory like so many of his theories doesn’t hold up to reality. Increased savings go into banks. Banks are in the business to lend money in normal times. Someone will borrow the money and spend it. Second if everyone saved prices will drop. People would start to be attracted to lower prices and spend. Even the biggest savers in the world have a marginal propensity to consume. Raiford because of economic ignorance prevalent throughout society fails to connect the dots and discard this Keynesian myth.

And there you have it. A lot of economic disinformation is being taught and used by politicians, personalities and even our Federal Reserve Chairman. Mr. Keynes did a lot of good brilliant work on developing a national economic model overview referred to as the Gross Domestic Product. He is an economic giant and his concepts are taught but he was wrong on the paradox of thrift, liquidity trap and many of his depression era theories. Our Federal Chairman is a strong follower of these theories. God help us all.

Liquidity trap. What is it and why is it significant? A liquidity trap is a situation in monetary economics in which a country’s interest rate has been lowered nearly or equal to zero to avoid a recession. Sound familiar? Our Federal Funds rate or commonly referred to overnight rate of lending, is currently 0.20%. And no one is lending. The market is not stimulated. Banks are keeping assets in short term cash accounts and avoiding long term investments making the recession worse. Mr. Bernanke is reliving the same liquidity trap that Keynes experienced in the 1930’s. So Mr. Bernanke is telling all those who will listen to pump trillions into the economy to get the economy moving again. And there you have the well intentioned motive of Mr. Bernanke although like Keynes the well intentioned theories will prove to be a monumental disaster for the country.

Why are banks really holding out? Politically you could argue the dysfunctional nut jobs in Washington DC are destroying banking confidence with crazy bail outs, buy outs, insane tax policies, insane mark to market accounting rules and you would be partially correct. The politicians in Washington are a disaster. And it’s both parties. Both parties need to be retired to the ash heap of history along with the Whigs, Federalist and Bull Moose political parties. The Democrats and Republicans of today are completely and totally incompetent to do anything. The federal government should be frozen and stored away in some deep freezer only to be thawed out after the adults have cleaned up the mess they created. So yes the political situation is hurting the economy. But that’s not the major reason banks are holding out.

Banker being bankers are looking at possible future inflation. Why is this so important to a banker? Bankers have been burned so many times by government it just comes naturally. In the 60’s and early 70’s banks made low interest loans only to be burned by inflationary federal government and Federal Reserve policies that created inflation in the late 70’s and early 80’s. Bankers made 5% loans in 1973 only to see loan rates climb to 9% in 1974 then 18% in 1981. The inflation rate went from 3% to 15%. So if you’re a banker and you made that nice 5% loan for 30 years guess what? Eight years into the loan the inflation rate is 15% and you’re in the red. Your books are a disaster full of low interest loans and you either have to go out of business or make very high risk loans to recoup your massive losses. And this is what happened to many savings and loan companies that lead directly to the savings and loan disaster of the late 80’s and early 90’s. It was bad government fiscal and monetary policy leading to the destruction of hundreds of lending institutions and the loss of thousands of jobs. The government created the Resolution Trust Fund to clean up the mess it had created.

Then after the S&L mess was cleaned up we got the Community Reinvestment Act, Sarbanes-Oxley, Freddie Mae, Fannie Mac and political backstabbing. Banks were forced to make bad loans by the government to unworthy borrowers, Fannie and Freddie buy and sell toxic assets throughout the banking and financial system, AIG and other politically connected firms buy the toxic assets by the billions for political favors from Washington.

Bribes, payoffs, bonuses of every kind imaginable were made and the system crashed. Insiders on Wall Street demanded payback for the bogus paper coming out of Fannie and Freddie and then came the bail outs. Fraud and chaos once again perpetrated by the politicians in Washington. These robbers just cannot resist the temptation to screw with the banking system of America with their insane schemes. It’s like the crooks and mafia joined forces with the police and are ransacking every bank they can get to.

And now the final blow to bankers’ confidence. The Federal Reserve assisted by Congress pumps up the monetary base from $800 billion to $1,800 billion. Bankers being bankers are not the stupid twits all the Keynesians in congress think they are. They can read the Federal Reserve data. They can do the math. They are bankers. They passed business calculus and accounting in college unlike our idiots in Washington with their political science degrees of useless information. Would any sane banker make a loan at 5% if the inflation rate is going to be 15% in a couple of years? Gee let me think on that one Mr. Frank and Mr. Dodd. It’s really quite simple to clear thinking bankers and anyone else paying attention. Only blundering politicians and Keynesian economists who think they can pull a fast one over the dumb business bumpkins are fooled by this buffoonery.

So what is the real deal? Economics is part science and part psychological. Having a communist educated idiot in the White House and a bunch of thieves in congress is not the way to inspire confidence. What would I do?

Cut federal spending. The last thing the economy needs is more idiots spending taxpayer’s money. Privatize social security, eliminate all aid to seniors and cut them a check every month and let them deal with it. Billions and billions would be saved in useless bureaucracies and more importantly the money would go to the people. Get rid of the departments of education and housing. Complete and utter waste of money if there ever was one. All the money in the world isn’t going to make a dumb kid smart.

Take away the power of the Federal Reserve to set any kind of interest rate. Batting 500 in baseball is good but not when it comes to banking. Leave the banks alone to charge what they want to for interest rates. As a safeguard pass an act similar to Glass-Segal limiting banks to no more than 5% market share in the United States. Not needed but it will make the monopoly conspiracy theory people happy. It’s past time to strip the Federal Reserve of its power over interest rates.

Cut the corporate and capital gains taxes to 25% and 10%. Sending a signal that comrade Obama is not going to pull a Chairman Mao would be a nice gesture to the folks who actually work for a living.

Better yet get a flat income tax and get rid of all other federal taxes including tariffs, corporate and capital gains. Do that and the boom will last a decade or more. Everyone who wants a job will have one. Private markets and employers actually work for a living. Government is nothing more than a thief or at best a referee.

And that is the fundamental differences in economist. The demand side Keynesians believe they are superior and resort to government power and money to bully people and businesses around. Their policies lead to disaster time and time again. Fascist, socialist and communist are drawn to the economics of Carl Marx and John Maynard Keynes.

The supply side Milton Freidman types believe in free markets and little government interference. Adam Smith in his book Wealth of Nations back in 1776 pretty much captured the magic of free enterprise 223 years ago. Nothing really has changed much. Nations that pursue free economic systems prosper and those that don’t get poor. It’s not complex.
People claim Wall Street greed brought down the house of cards. Nothing could be further from the truth. Washington’s constant meddling in the banking system decade after decade brought it all crashing down. Why the banks? Well because as Willie Sutton said “that’s where the money is.”

And what is in it for politicians in the long run to destroy the economic system of its country? Besides the obvious political power and pay offs where will all this lead? Inflation will destroy elderly independence and wipe out the middle and upper middle classes. Obama wants a classless society. Inflation is the quickest way to get there.

Socialized medicine will lead to rationing. Who will control the rationing? Government. Favored political groups like minorities and gays will get preferential treatment as they do now with so many government programs. The elderly reduced to poverty by inflation will see the most severe rationing. No money no power. Dictatorship. Just as Roosevelt and Keynes enjoyed during the height of WWII.

And the ironic thing is the people will praise Obama just like they did Roosevelt when it’s all over. I guess it would be similar to John McCain praising his torturers for quitting the torture. It sure does feel good when they quit breaking your arms doesn’t it John?

And there you have it Mr. Beck and Raiford. I strongly urge you to read up on libertarian principals and economics. Freidman, Smith, CATO, Heritage and the Libertarian Party are and always will be sources of inspiration. Tomas Payne in his Common Sense pamphlets need to be reprinted and distributed to all freedom loving Americans.

The world is a different place than it was in 1929. Information passes quickly to the masses. If I and millions can see for ourselves what is happening to the monetary base there is hope. We can remove the tyrants from power. As Mr. Beck states this isn’t a Republican or Democratic thing. Both political parties are moving in the same direction, total power. They are fighting over the spoils of power not differing principals. Both parties need to be removed from power and social engineering needs to be put at the state and local level where it belongs.

If Mr. Beck or Raiford read this insipid little blog I hope it helps. Don’t Tread on Me.

Alan Greenspan was from 1987 to 2006 the Chairman of the Federal Reserve of the United States. Basically he set Federal Reserve interest rates, performed oversight on the Federal Open Market committee (FOMC) and set reserve requirements for banks. The first function grabs all the headlines in the press. And deservedly so since this operation affects home loans, credit card rates and what banks can borrow from other banks. But it was the second function that created as much of the financial mess as the first one. But let’s start off with the first function specifically the federal funds (FF) rate.

Alan Greenspan did an incredible job for many years. Many economists were in awe of his ability to anticipate 3 months to a year down the road what the economy would be doing. This is referred to as “lag” effect on the economy. Simply put what Mr. Greenspan did in March would not have an effect for months. It takes a real master and a little luck to get monetary policy right looking so far in the future but give Mr. Greenspan credit. He did it for years under Reagan, Bush I and Clinton.

In 1987 when Black Monday occurred and the stock market crashed 22% (the equivalent of a 3,000 point drop in the 2008 market) Mr. Greenspan was masterful in restoring confidence in markets. The Federal Reserve pumped money into the markets and restored confidence. By the end of the year the stock market was in the black by going from 1.897 in January to 1,939 in December. A textbook example of how to handle a crash. Alan Greenspan’s reputation as the master of the Federal Reserve was born.

So what happened under Bush II? A good insight comes from following Mr. Greenspan’s corrections of the FF rate.

In 1987 the FF rate was 6% to 7.3%. Played like a master through the crash. 1989 as the Savings and Loan debacle was coming unhinged Greenspan raised the rate to 9.8%. A master stroke that caused a lot of silly loans that would have been made to become expensive even to the most blinded speculators. Now keep in mind the Savings and Loan disaster didn’t play itself out fully until 1990-91. Mr. Greenspan was ahead of the curve, saw what was coming and reacted properly. He made money more expensive for speculators saving the America public billions of dollars in bail out money. A masterful job of running the Federal Reserve.

As Mr. Greenspan saw the negative impact of the Savings and Loan disaster on the economy and the slowdown in economic activity he dropped the FF rate to 4.49%. Once again brilliant use of monetary policy. Everyone with inside business knowledge griped here and there but there was no disputing Mr. Greenspan was keenly aware of what was going on in the economy and was moving monetary policy in the right direction.

In the early 90’s as the economy tanked and Clinton came to power and raised taxes. The FF rate was lowered to 2.91%. As the 90’s went on Clinton cut capital gains taxes and signed the NAFTA free trade agreement with Canada and Mexico the economy began to heat up again. The FF rate climbed to 4.5% to 5.5%. Steady and calm as it should be for a steady and calm economic growth period. Well done, we all enjoyed the 90’s.

As the 90’s closed and the Internet stock exploded and went crazy huge amounts of wealth were being created. Mr. Greenspan gave his famous speech in 1996 about the stock market and irrational exuberance.

Mr. Greenspan 12-05-1996 “Clearly, sustained low inflation implies less uncertainty about the future, and lower risk premiums imply higher prices of stocks and other earning assets. We can see that in the inverse relationship exhibited by price/earnings ratios and the rate of inflation in the past. But how do we know when irrational exuberance has unduly escalated asset values, which then become subject to unexpected and prolonged contractions as they have in Japan over the past decade?”

Clearly Mr. Greenspan was way ahead of the curve since the National Association of Securities Dealers Automated Quotations (NASDAQ) didn’t crash until April 2000. And as this new wealth flooded Americas markets creating the specter of overpriced assets and inflation what did Mr. Greenspan do? Raised the FF rate to 6.85% putting a damper on inflation. Brilliant once again.

So what happened under Bush II? As money came into Fannie Mae and Freddie Mac flooding the home mortgage markets Mr. Greenspan didn’t notice? No! Mr. Greenspan did notice. He is recorded several times warning congress that more oversight and tighter financial restrictions need to be placed on Fannie Mae and Freddie Mac. Every chance he got from 2003 he mentioned the for coming crisis to congress until he retired in 2006. He was not ignorant. He just failed to act.

Why? Only Mr. Greenspan knows. What we do know is by 2002 the FF rate was 1.23%. Justifiable since the economy was recovering from 9-11 and a recession. As the sub prime loans began to dominate the markets starting in 2003 driving up real estate cost faster than inflation what happened? Mr. Greenspan LOWERED the rate to .97%. The exact opposite of his earlier actions under similar circumstances. The FF rate stayed at 1% through much of 2004 as foreign funds flooded US market in search of stable sure returns and sheer speculation. In essence Mr. Greenspan opened the floodgates of plentiful cheap money. Why?

Was he a saboteur? Did he want democrats to gain power? A financial collapse so well timed for the 2008 election certainly would not be beyond the capabilities of Mr. Greenspan and others with access to trillions in funds. We will never know the story for years but what is certain is Mr. Greenspan had a history of doing the right thing and he went against everything he had accomplished in the past to facilitate the destruction of the economy.

Eventually the FF rate was raised to 5.27% in 2007 as the housing markets were crashing all around everyone. The opposite of what should have happened. This intentional or unintentional destruction of markets by the Federal Reserve and it’s manipulation of interest rates is a text book example of why many economist think this power should be taken away from the Federal Reserve. Many economist feel interest rates should be set by market forces alone. Currently the FF rate is 0.13%. Yes 0.13%. The Federal Reserve is scrambling to restore credibility and facilitate money growth. Similar to closing the barn door after the horses have all escaped.

The FOMC actions are more complex but basically Mr. Greenspan was increasing money stock (MZM) during this period of 2003 to 2006. This while foreign investment was flooding our markets. Mr. Greenspan should have been stabilizing or even shrinking the money sock by selling treasury bonds and taking the money off the market and into the treasury. Coupled with raising interest rates and the housing bubble would have at the very least been mitigated if not eradicated.

Now the Federal Reserve is increasing stocks of money faster than ever. What is the next housing bubble? Most likely our currency. Our monetary base has gone up from $824 billion to $1,435 billion in 2008! Normally this change is from 0% to at the most 15% from year to year. This year it has grown an astonishing 80%! We are in very serious times.

If the congress fails to cut taxes or better yet scrap the current tax code and adopt the fair tax we will have a dollar collapse similar to third world countries like Argentina, Venezuela and the former USSR. Congress needs to cut taxes now; Congress needs to take away the power of the Federal Reserve to set interest rates. The Federal Reserve needs to quit increasing the money supply. Congress needs to quit baling out everyone. But none of this will happen. When it all collapses we will once again need to rely on each other to get through this. As we have for centuries.

History repeats itself. I wrote about him in my first post on this web site. And here is more evidence of Keynesian economics and the democrats seizing power for the foreseeable future. Another example of the people having their trust betrayed by selfish and political motives. Mr. Greenspan will go down as one of the worst Federal Charimans along with Eugene I. Meyer (September 16, 1930 – May 10, 1933), Eugene R. Black (May 19, 1933 – August 15, 1934), Marriner S. Eccles¹ (November 15, 1934 – February 3, 1948).