I read an article today entitled "South Korean comics warn of North’s threat" in the FT. I lived in S. Korea in 1984/5 while working for the US Air Force. I was flabbergasted by the regular routine of "news" shown on TV that kept the South Korean population in constant fear of the North's impending invasion.
Not having lived there now for 25 years, my guess from this article is after the first democratic elections there in 1987, the overt propaganda by the state died down and from that time South Koreans have been able to concentrate on creating an industrial nation with international companies and first rate technology instead of being beaten down by authoritarian regimes with threats of the boogie man from the north.
So I was quite amused, surprised, disappointed and baffled when I read this article about comics created to "re-educate" the youth in South Korea about the "threat" to the north. The only "threat" from the north in Korea is that the people there will someday rise up and overthrow their dictatorship and over run the south to get out of the hellhole of the north.
It is high time that the South stops propagandizing about the north as a threat. If the north decided to "invade" the south tomorrow, the main fear would be that after an initial surge, the military of the north would immediately turn on their despotic leaders and reverse the incursion back on the north. They would then proceed to hang the leader and his cronies.
The south would have a huge humanitarian mission on its hands unlike anything that has been witnessed in the last 50 years. They would need billions of dollars of international support to manage the influx of refugees and to invest in the north to begin to bring them back from the dark ages.
So why the new comic book now? The only thing about North Korea I am 100% sure of is it's importance to the United States as a "strategic partner". Yes, you read that correctly. North Korea is one of our most important strategic allies in East Asia. Without their despotic leaders, nuclear games, authoritative government and repressed population, we would have no good reason to have 35,000 or so troops plus the major contingent of military "advisors" in the South to hedge ourselves against the real reason those troops are there, China. The ignorant, ethnocentric and paranoid powers in Washington still have 19th century mentalities towards world power and politics and "fears" of China emerging as a power that would somehow undermine US "dominance" in the world.
Truth be told, our ignorant, paranoid and ethnocentric Washington power circles are single-handedly destroying our prominence on the world stage as I write this. History will show that during one of the most important times in modern development, where the world is witnessing the emergence of secondary nations to economic relevance and power, Washington was busy spending trillions of dollars in pointless wars waged against people with no education or industrial capacity whatsoever. We are defeating ourselves before any real challenge has begun and South Korea is continuing to play a part in the internationally destructive role Washington has set up for itself and it's soon to be poverty stricken people.
Saturday, December 19, 2009
Tuesday, December 15, 2009
Banks Paying Back What?
I have been reading about the banks "paying back TARP" and "regaining their freedom" from the Government reigns for some days now with disdain for what is being "sold" to us by the media as a "payback" of money injected into the banks during the "crises" in 2008.
There is still a major crisis. The pittances the banks are paying back are only part of the total sum of what the Fed / Government has done and is still doing to back these institutions. They should remain under supervision for everything they do and their management should be under salary caps. If they don't like it they should all go to work with hedge funds, the unwieldy banking institutions they run broken apart with their retail, banking, insurance operations etc. regulated and their trading arms closed or spun off to the pigs in the Hedge Fund industry (which should be regulated or shut down as well but for now this is highly unlikely).
I would like to remind you that besides the deregulation of banking in 1999 which was done to rubber stamp the mega Citycorp merger with Travelers our legislative body also deregulated leverage rules for leverage "not using bank deposits" as stated in a January 2009 Time Magazine article:
Now what is interesting is the "not raising a single dollar of capital" part. They could just go about doubling down on leverage. The "banking" industry had convinced our impotent and incompetent legislators as well as the idiot running the Fed at the time, Greenspan, that banks had installed sophisticated "risk management" tools that would allow them to manage this escalated leverage. I remember reading with amazement the monthly or quarterly updates by "investment banks" on Wall Street on how much capital they could "loose" or was “at risk” in a single day given information they had on hand and risk management practices in place. The numbers had grown to the hundreds of millions of dollars in some cases. These were "day" trading risks.
Back to the point, the Fed agreed not only to the injection of cash into the large money center banks in 2008 (agreed with the Treasury) but also to accept all kinds of before unheard of collateral against borrowings from the Fed. In addition the Fed, in bailing out some institutions like City, Bear Sterns, BoA and AIG agreed to assume hundreds of billions of dollars in losses on "assets" removed from their books that were "locked up" in the credit crises. These institutions alone account for nearly $500 Billion in "guarantees" against bad debts / assets on their books (well off books as well for technical / accounting purposes). Plus there is another $300 Billion PLUS that has been borrowed by financial institutions from the markets with implicit guarantees under the Temporary Liquidity Guarantee Program.
In addition the Fed just started it's $1.8 Trillion program to "become" the commercial paper industry, a Trillion and a half has been allocated to buy mortgages from the banks and GSE's, another Trillion program to buy consumer loan-backed securities called TALF, and $300 Billion in outright "injections" by the fed done through bond purchases from the banks.
As I write this, Goldman still has about $20 Billion on it's books it borrowed under TLGP so as far as I am concerned any PIG Institution that still has guaranteed money on it's books is the same as having the money injected directly. They were able to borrow at ridiculously low rates by having the direct guarantee of the government, hence they should be highly regulated until they are COMPLETELY CLEAN of any support by the government.
Oh, well that is not really possible now is it? The government "being" the mortgage market, consumer credit market, commercial backed mortgage market, commercial paper market etc. In other words, none of these intuitions could even continue to function under anything like "normal" market conditions without the FED putting about $7 Trillion in support out there. You can see some of the numbers here.
So, basically, I can say “The Hell with them all”. They so totally ruined the financial system they should not be “free” to do anything without heavy government regulation until this entire mess is cleaned up. So where are the Chiefs going to go if the entire finance industry is heavily regulated? Guess they will just have to accept “government” salaries like doctors in a government health plan until they can learn to “walk” on their own again. Alternatively they could all go to the hedge fund industry until some government with a spine shuts that worthless unregulated industry down completely.
For a little comedy check out this 12 part short video series on the Fed.
For very extensive analysis of Fed workings through the crises check this out.
There is still a major crisis. The pittances the banks are paying back are only part of the total sum of what the Fed / Government has done and is still doing to back these institutions. They should remain under supervision for everything they do and their management should be under salary caps. If they don't like it they should all go to work with hedge funds, the unwieldy banking institutions they run broken apart with their retail, banking, insurance operations etc. regulated and their trading arms closed or spun off to the pigs in the Hedge Fund industry (which should be regulated or shut down as well but for now this is highly unlikely).
I would like to remind you that besides the deregulation of banking in 1999 which was done to rubber stamp the mega Citycorp merger with Travelers our legislative body also deregulated leverage rules for leverage "not using bank deposits" as stated in a January 2009 Time Magazine article:
Regulators have long had a lower capital requirement on loans that are not backed by deposits. But in 2004, the Securities and Exchange Commission (SEC) removed rules that capped leverage at 15 to 1 for investment-banking firms like Goldman Sachs. That allowed the firms to vastly expand their lending activities without raising a single new dollar of capital. One big backer of the rule change was reportedly former Treasury Secretary Henry Paulson, who was then Goldman's CEO. By that time, the regulatory separation between investment banks and traditional banks had long since been removed, so traditional banks such as Citigroup and Bank of America shifted more and more of their lending operations to their investment-banking divisions, and leverage took off. By the end of 2007, many banks were lending $30 for every dollar they had in the vault. "Changing the net-capital rule was an unfortunate misjudgment by the SEC," says former SEC official Lee Pickard. "It's one of the leading contributors to the current financial crisis." (See who else is to blame.)
Now what is interesting is the "not raising a single dollar of capital" part. They could just go about doubling down on leverage. The "banking" industry had convinced our impotent and incompetent legislators as well as the idiot running the Fed at the time, Greenspan, that banks had installed sophisticated "risk management" tools that would allow them to manage this escalated leverage. I remember reading with amazement the monthly or quarterly updates by "investment banks" on Wall Street on how much capital they could "loose" or was “at risk” in a single day given information they had on hand and risk management practices in place. The numbers had grown to the hundreds of millions of dollars in some cases. These were "day" trading risks.
Back to the point, the Fed agreed not only to the injection of cash into the large money center banks in 2008 (agreed with the Treasury) but also to accept all kinds of before unheard of collateral against borrowings from the Fed. In addition the Fed, in bailing out some institutions like City, Bear Sterns, BoA and AIG agreed to assume hundreds of billions of dollars in losses on "assets" removed from their books that were "locked up" in the credit crises. These institutions alone account for nearly $500 Billion in "guarantees" against bad debts / assets on their books (well off books as well for technical / accounting purposes). Plus there is another $300 Billion PLUS that has been borrowed by financial institutions from the markets with implicit guarantees under the Temporary Liquidity Guarantee Program.
In addition the Fed just started it's $1.8 Trillion program to "become" the commercial paper industry, a Trillion and a half has been allocated to buy mortgages from the banks and GSE's, another Trillion program to buy consumer loan-backed securities called TALF, and $300 Billion in outright "injections" by the fed done through bond purchases from the banks.
As I write this, Goldman still has about $20 Billion on it's books it borrowed under TLGP so as far as I am concerned any PIG Institution that still has guaranteed money on it's books is the same as having the money injected directly. They were able to borrow at ridiculously low rates by having the direct guarantee of the government, hence they should be highly regulated until they are COMPLETELY CLEAN of any support by the government.
Oh, well that is not really possible now is it? The government "being" the mortgage market, consumer credit market, commercial backed mortgage market, commercial paper market etc. In other words, none of these intuitions could even continue to function under anything like "normal" market conditions without the FED putting about $7 Trillion in support out there. You can see some of the numbers here.
So, basically, I can say “The Hell with them all”. They so totally ruined the financial system they should not be “free” to do anything without heavy government regulation until this entire mess is cleaned up. So where are the Chiefs going to go if the entire finance industry is heavily regulated? Guess they will just have to accept “government” salaries like doctors in a government health plan until they can learn to “walk” on their own again. Alternatively they could all go to the hedge fund industry until some government with a spine shuts that worthless unregulated industry down completely.
For a little comedy check out this 12 part short video series on the Fed.
For very extensive analysis of Fed workings through the crises check this out.
Thursday, December 03, 2009
End of Support for President Obama
From this moment forward I am categorically removing my support for President Obama. The tripling of troops in Afghanistan under his watch has absolutely destroyed my faith in him as an independent thinker, diplomat, and logical man, a president who has the best interest of the citizens of America in mind.
The US has spent over a Trillion Dollars on the “war” in Iraq. (A nation about the size of California) Let me remind you, Iraq is, was and never has been a “war”. When we “invaded” Iraq, they had no standing army (only the president’s “guard” which was basically in place to keep the bully, Saddem Hussein, in power), no standing air force and no standing navy. They had been through over 10 years of embargo. Iraq was nothing more than a training exercise for our military, a large adrenaline surge for troops and to train the next generation of our military (not to mention a great way to dump piles of legacy munitions sitting around in storage depots).
Like any people who resent being invaded, Iraq has been fighting back with whatever means they have and we know what the result has been. Thousands of American solders killed, hundreds of thousands of Iraqi civilians and militants (Iraq version of “freedom fighters”) killed. What for? Did you ever loose sleep worrying about the “Iraq Threat” on the US? Of course not, cause there is and never was one.
Can you give me an example of what a Trillion Dollars spent in the State of California would look like? Can you give me an example of what $350 Billion would look like? We spent at least that much “rebuilding” Iraq, yet they still have no reliable electricity, water or reliable means of communications to show for it. Oh, but lets not forget, the multitude of American companies, well connected to the government, who hire high paid lobbyist, consultant firms, and give lavishly to our legislators, directly and indirectly in the many creative ways created over the years to pay your congressman or senator without putting it directly in their pocket. Lets not forget the benefits to our military leaders who are ushered into the private sector with tremendous benefits after leaving service as payment for helping the American Military Establishment (Corporate Welfare to the highest degree) win contracts.
So that was Iraq. Now we have Afghanistan, another nation comparable in size to one American state, this time Texas. The latest move by President Obama puts nearly 100,000 troops in Afghanistan. Yea, Afghanistan, a rocky arid nation with little “official” standing army, no navy, no air force and no technology, nearly no industrial productive capacity at all, and they are largely uneducated. Does this sound like a nation with the capacity to harm or otherwise threaten the US? They cannot even “create” a gun let alone any more sophisticated “devise” capable of harming another individual let alone another nation.
So lets look at the “real enemy” over there headed by Osama Bin Laden (if he is in fact still alive, it is also worth noting he is not an “issue” any longer), a bunch of folks who have idealistic reasons to oppose the US. I must say I don’t disagree with their “political” reasons to oppose us. They want the US off of Muslim soil. So be it, get off of their soil. Let them live like it is the 6th century if that is what they want to do. Rational people will leave and go to other countries just as all the talent has left Africa, and used to (still do to some extent) leave Latin American nations, and leave South Asian nations and former Soviet Nations for better opportunity not under repressive regimes in their own nations (although Bush and now Obama seem to be learning more from the oppressive nations on this plane then from any ideologically free thinking ideas of the past). Being on their soil serves us no purpose. The oil in the Mid East is worth nothing in the ground. They have no other natural resources. They will sell it. Fine. What are we doing there? They have no technology. We (Western nations with technology) sell them what they need to take the oil out of the ground, transport it, refine it and ship it. You name it. They are completely unable to even exploit their only resource without the Western Nations and their technology. So what do we have to worry about? We will get paid. Secondly, they have nothing useful to do with all the money they make on oil sales without the West again. They cannot build anything without raw materials, western finished materials, tools, machines etc. They cannot invest the cash in anything worthwhile in the Middle East so they buy stakes in Western companies where they can benefit from the technology and innovation and wealth creation of the nations around the world that produce things other than oil.
What it the heck would any rational person be doing on land that is opposed by a growing bunch of radical religious folks when the land has no productive value to us whatsoever?
Now that “enemy”, yea, a bunch of guys have some rudimentary schools where they “teach” ignorant poverty stricken men from around the region how to bomb stuff and ideologically oppose Western culture. Well, we pretty much do the same thing, only with technology. We create “enemies”, the “evil empire” the “axis of evil” the “cancer of the Taliban” (as Pres. Obama put it, which really burns me up). We have to create enemies so we (power) can justify the half trillion a year in direct military spending and the other billions in indirect military spending. This is about American Money, not enemies; American Power Circles, not Taliban; American imperialism, not threat.
A bunch of guys with the equivalent of a few hundred thousand dollars, some flight training and some box cutters has created war in 2 nations and expenditures per capita not matched since a world war!! Can you imagine if someone would have said to you 10 years ago, that after a couple prior attempts, some guys would manage to actually take down a couple of tall buildings in NYC and after that America would spend over $2 Trillion Dollars and engage themselves in a decade “war” with 2 nations that together are about the size of California and Texas using hundreds of thousands of American military and civilian personnel, cause the deaths and maming of US and allied troops triple the number of people killed in the NYC take down, cause directly or indirectly around 500,000 civilian and insurgent (justified insurgents I might add) deaths in the invaded countries? (I could go on but you get the point.)
I could discuss all of the idiot decisions made by our prior government lead by a president with the intellect of a door knob but it’s all out there. One more rant will not solve anything. However, I will not, will not, will not support a man that sold such a rational line of diplomacy during his run for power but after taking power the result is his selling (or attempting to sell) a decision to escalate the “war” in Afghanistan. There is no justification. I don’t care what his “advisors” said; he is not seeing the world clearly any longer. I don’t know what “deal” he made to get into the White House but it is obvious that “power circles” have the better of him and he does not have the backbone or no longer has the incentive to do what is right for American citizens and our Nation. Better put, he obviously has GREAT incentive to do what is wrong.
If you want a nice round up of his decision (not nearly complete but what do you expect from 9 minutes of media?) check out this link http://www.youtube.com/watch?v=DDmen_2yoQY
For information on the land sizes of the nations involved you can see the US at
http://www.infoplease.com/ipa/A0108355.html
And the world at
http://en.wikipedia.org/wiki/Land_area
As for me, I am signing off my support for President Obama in a Great Big Way and I encourage you to do the same. This man is no longer representing me.
Peace.
The US has spent over a Trillion Dollars on the “war” in Iraq. (A nation about the size of California) Let me remind you, Iraq is, was and never has been a “war”. When we “invaded” Iraq, they had no standing army (only the president’s “guard” which was basically in place to keep the bully, Saddem Hussein, in power), no standing air force and no standing navy. They had been through over 10 years of embargo. Iraq was nothing more than a training exercise for our military, a large adrenaline surge for troops and to train the next generation of our military (not to mention a great way to dump piles of legacy munitions sitting around in storage depots).
Like any people who resent being invaded, Iraq has been fighting back with whatever means they have and we know what the result has been. Thousands of American solders killed, hundreds of thousands of Iraqi civilians and militants (Iraq version of “freedom fighters”) killed. What for? Did you ever loose sleep worrying about the “Iraq Threat” on the US? Of course not, cause there is and never was one.
Can you give me an example of what a Trillion Dollars spent in the State of California would look like? Can you give me an example of what $350 Billion would look like? We spent at least that much “rebuilding” Iraq, yet they still have no reliable electricity, water or reliable means of communications to show for it. Oh, but lets not forget, the multitude of American companies, well connected to the government, who hire high paid lobbyist, consultant firms, and give lavishly to our legislators, directly and indirectly in the many creative ways created over the years to pay your congressman or senator without putting it directly in their pocket. Lets not forget the benefits to our military leaders who are ushered into the private sector with tremendous benefits after leaving service as payment for helping the American Military Establishment (Corporate Welfare to the highest degree) win contracts.
So that was Iraq. Now we have Afghanistan, another nation comparable in size to one American state, this time Texas. The latest move by President Obama puts nearly 100,000 troops in Afghanistan. Yea, Afghanistan, a rocky arid nation with little “official” standing army, no navy, no air force and no technology, nearly no industrial productive capacity at all, and they are largely uneducated. Does this sound like a nation with the capacity to harm or otherwise threaten the US? They cannot even “create” a gun let alone any more sophisticated “devise” capable of harming another individual let alone another nation.
So lets look at the “real enemy” over there headed by Osama Bin Laden (if he is in fact still alive, it is also worth noting he is not an “issue” any longer), a bunch of folks who have idealistic reasons to oppose the US. I must say I don’t disagree with their “political” reasons to oppose us. They want the US off of Muslim soil. So be it, get off of their soil. Let them live like it is the 6th century if that is what they want to do. Rational people will leave and go to other countries just as all the talent has left Africa, and used to (still do to some extent) leave Latin American nations, and leave South Asian nations and former Soviet Nations for better opportunity not under repressive regimes in their own nations (although Bush and now Obama seem to be learning more from the oppressive nations on this plane then from any ideologically free thinking ideas of the past). Being on their soil serves us no purpose. The oil in the Mid East is worth nothing in the ground. They have no other natural resources. They will sell it. Fine. What are we doing there? They have no technology. We (Western nations with technology) sell them what they need to take the oil out of the ground, transport it, refine it and ship it. You name it. They are completely unable to even exploit their only resource without the Western Nations and their technology. So what do we have to worry about? We will get paid. Secondly, they have nothing useful to do with all the money they make on oil sales without the West again. They cannot build anything without raw materials, western finished materials, tools, machines etc. They cannot invest the cash in anything worthwhile in the Middle East so they buy stakes in Western companies where they can benefit from the technology and innovation and wealth creation of the nations around the world that produce things other than oil.
What it the heck would any rational person be doing on land that is opposed by a growing bunch of radical religious folks when the land has no productive value to us whatsoever?
Now that “enemy”, yea, a bunch of guys have some rudimentary schools where they “teach” ignorant poverty stricken men from around the region how to bomb stuff and ideologically oppose Western culture. Well, we pretty much do the same thing, only with technology. We create “enemies”, the “evil empire” the “axis of evil” the “cancer of the Taliban” (as Pres. Obama put it, which really burns me up). We have to create enemies so we (power) can justify the half trillion a year in direct military spending and the other billions in indirect military spending. This is about American Money, not enemies; American Power Circles, not Taliban; American imperialism, not threat.
A bunch of guys with the equivalent of a few hundred thousand dollars, some flight training and some box cutters has created war in 2 nations and expenditures per capita not matched since a world war!! Can you imagine if someone would have said to you 10 years ago, that after a couple prior attempts, some guys would manage to actually take down a couple of tall buildings in NYC and after that America would spend over $2 Trillion Dollars and engage themselves in a decade “war” with 2 nations that together are about the size of California and Texas using hundreds of thousands of American military and civilian personnel, cause the deaths and maming of US and allied troops triple the number of people killed in the NYC take down, cause directly or indirectly around 500,000 civilian and insurgent (justified insurgents I might add) deaths in the invaded countries? (I could go on but you get the point.)
I could discuss all of the idiot decisions made by our prior government lead by a president with the intellect of a door knob but it’s all out there. One more rant will not solve anything. However, I will not, will not, will not support a man that sold such a rational line of diplomacy during his run for power but after taking power the result is his selling (or attempting to sell) a decision to escalate the “war” in Afghanistan. There is no justification. I don’t care what his “advisors” said; he is not seeing the world clearly any longer. I don’t know what “deal” he made to get into the White House but it is obvious that “power circles” have the better of him and he does not have the backbone or no longer has the incentive to do what is right for American citizens and our Nation. Better put, he obviously has GREAT incentive to do what is wrong.
If you want a nice round up of his decision (not nearly complete but what do you expect from 9 minutes of media?) check out this link http://www.youtube.com/watch?v=DDmen_2yoQY
For information on the land sizes of the nations involved you can see the US at
http://www.infoplease.com/ipa/A0108355.html
And the world at
http://en.wikipedia.org/wiki/Land_area
As for me, I am signing off my support for President Obama in a Great Big Way and I encourage you to do the same. This man is no longer representing me.
Peace.
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