Feckless Nation, or, Fortress of Lies.

James Howard Kunstler, Kunstler.com

Originally published 11 March 2013

History has a special purgatory where it sometimes stashes feckless nations punch drunk on their own tragic choices: the realm where anything goes, nothing matters, and nobody cares. We've surely crossed the frontier into that bad place in these days of dwindling winter, 2013.

Case in point: Mr. Obama's choice of Mary Jo White to run the Securities and Exchange Commission. A federal prosecutor back in the Clinton years, Ms. White eventually spun through the revolving door onto the payroll of Wall Street law firm Debevoise & Plimpton, whose clients included Too Big To Fail banks JP Morgan, Bank of America, Morgan Stanley, and UBS AG, defending them in matters stemming from the financial crisis that began in 2008, as well as other companies that needed defending from allegations of financial misconduct, such as the giant HCA hospital chain (insider trading), General Electric (now a virtual hedge fund with cases before the SEC), and the German-based Siemens Corporation (federal bribery charges).

A republic with a sense of common decency -- and common sense -- would have stopped the nomination right there and checked the "no" box on Mary Jo White just for violating the most basic premise of credibility: that trip through the revolving door that shuttles banking regulators from the government agencies to the companies they used to oversee and sometimes back again.

Has there not been enough national conversation about the scuzziness of that routine to establish that it's not okay? Does it not clearly represent the essence of dysfunction and corruption in our regulatory affairs? Didn't President Obama promise to seal up the revolving door? So how could Mary Jo White possibly be taken seriously as a candidate for the job? And how is it possible that everyone and their uncle, from The New York Times editorial page to the Sunday cable news political shows to the halls of congress, is not jumping up and down hollering about this? Well, because anything goes, nothing matters, and nobody cares.

The funny part is that, when challenged over her past connections to the banks and companies she would now have to regulate, Mary Jo White offered to recuse herself from future cases involving them. So, from the get-go as SEC head, Ms. White would not concern herself with the doings of JP Morgan, Bank of America, and Morgan Stanley? How is it that gales of laughter did not blow Mary Jo White clean out of the hearing room? Is there not another qualified person from sea to shining sea who could come in and do the job without one hand tied behind his or her back?

Now it also turns out that upon leaving Debevoise & Plimpton, Ms. White is scheduled to collect monthly retirement checks from the company amounting to a half million dollars a year -- that's for life, by the way -- while she supposedly runs the SEC. How is that not a conflict of interest? The remedy proposed by Ms. White and her attorneys was for her to take the retirement loot as a lump sum during her tenure as SEC chair, after which she could revert to collecting her pension in the $42,500 monthly payouts. Pardon me, but, well ...what the fuck? What planet are we on?

As if that's not enough, Ms. White's husband, John W. White, is a partner at another giant Wall Street law firm, Cravath, Swaine & Moore, which frequently tangles with the SEC on behalf of its clients. Mr. White proposed to change his pay structure while his wife runs the SEC. More gales of laughter. He is also on the advisory committee of the Financial Standards Accounting Board, the group that oversees national accounting practices and which, in 2009, infamously changed its Rule157 so that TBTF banks could "mark to fantasy" the fraudulent CDOs and other bond-like "innovative" securities that they created -- many of which they had to eat after the housing bubble bust when the collateral for these swindles lost its value and the "innovators" could no longer pawn the stuff off on credulous pension funds and other client "muppets."

The silence over this disgraceful matter -- and many others like it, including the dead hand in the empty suit posing as US Attorney General -- indicates that not only is the rule of law extinct in this country, but so are public figures of principle and credible news organs. Nobody has made a noise about it. Anything goes, nothing matters, and nobody cares. So, the objection to it has to come from outside the authorized channels. And the consequences will mount outside the fortress of lies that the establishment has become.

HAPPY NEW YEARS Y'ALL!!!

2010 was a disaster. The mainstream media was responsible for the right-winged takeover of the Lower House of Congress, for Pfc Bradley Manning to be figuratively CRUCIFIED in the public square, for Obama (THAT One) caving time and time again again, undermining Nancy Pelosi and pruning Harry Reid's ability for enabling better legislation. For passing a bogus DADT Repeal which is anything BUT - and with the fake Bradley Manning scandle, they'll take years, if not decades, to get a round tuit and lift DADT. And yes, the Bradley Manning scandle is utterly FAKE, because all the evidence that's been produced so far are a bunch of BOGUS or at least apparently so chat logs produced by one disreputable character, Adrian Lamo, quisling!

And why am I so pissed off at the Bradley Manning scandle? Because if the guy is sent to 52 years in prison, or executed for Treason MERELY FOR SPEAKING THE TRUTH, then the US Government gets to be as opaque as it wants to be, but the citizenry, not just in the US but all over the world, will have to be utterly transparent to the US government! This is nothing short of utter insanity and pure fascism and is reminiscent of the sort of human liberty abuses that were predicted in Revelations Chapter 13. Even tho' I'm a Bible disbeliever!

And I am going to make a Hitler Downfall (Untergang) parody where Der Fuehrer complains that Obama (THAT One!) is horning in on HIS territiry and is liable for civil and criminal penalties under Godwin's Law!!!

Happy New Year!

Over One-and-a-half QUADRILLION

That's right. Quadrillion. Over one-and-a-half times that. That is the notional amount of derivatives, as denominated in US dollars. As reported by the Bank of International Settlements this March. It's on page 108 of this pdf.

Oh. My. God.

And Karl Denninger has figured out how the notional amount held by any financial institution becomes its realized losses. Let's hear what Mr. Denninger has to say:

As with the phony reinsurance contracts that AIG and other insurers wrote for decades, when AIG wrote hundreds of billions of dollars in CDS contracts, neither AIG nor the counterparties believed that the CDS would ever be paid. Indeed, one source with personal knowledge of the matter suggests that there may be emails and actual side letters between AIG and its counterparties that could prove conclusively that AIG never intended to pay out on any of its CDS contracts.

Now consider this.

There is some gross "notional" (or face) value of $683.7 trillion dollars outstanding as of the end of June 08 (last data available.) [Ed-M: Now 1.567 Quadrillion dollars - read the pdf.]

The lions share of those are not "CDS" on individual names or CDOs like what is going on here with AIG. They are instead interest-rate and/or FX products of one sort or another; $458 trillion worth. [Ed-M: Now 1.406 Quadrillion dollars.]

If even a couple of percent of those swaps are in fact "private lettered" out in the fashion that AIG is alleged to have done with their CDS.....

(Hint: This is how "notional" amounts end up becoming realized losses!)

Our Congress had better dig into this hornets nest right damn now because if in fact there is any material amount of this crap going on in the OTC derivative market the $170+ billion blown on AIG trying to cover it up will be a mosquito on an elephant's ass in comparison to what's about to happen to the world's economy and banking system.

If, in fact, it cannot be proved that this is not the case, given the extraordinary lengths that both government and private parties have gone to in order to cover up that IRA alleges AIG was actually up to, we must ring-fence and cut off any part of the financial system impacted by a potential detonation of that market right now, including the US Federal Government, as such a detonation will, if it occurs, destroy any part of the financial system it infests at the time the unwind occurs.

Actually, it will literally destroy the whole entire global economy, for it is now greater than the combined value of all paper wealth and all things (including living things) on Earth. Unless we can get this Beast to unwind without exploding.

If it does explode....

And Pres. Barack Obama will be at the receiving end of the great fury of the masses (holding torches and pitchforks) as they scream at him, "Now you've done it!"

Arrest Them.

URL Source: http://www.newsweek.com/id/190362

Michael Isikoff and Mark Hosenball (Newsweek)

Over objections from the U.S. intelligence community, the White House is moving to declassify—and publicly release—three internal memos that will lay out, for the first time, details of the "enhanced" interrogation techniques approved by the Bush administration for use against "high value" Qaeda detainees. The memos, written by Justice Department lawyers in May 2005, provide the legal rationale for waterboarding, head slapping and other rough tactics used by the CIA. One senior Obama official, who like others interviewed for this story requested anonymity because of the issue's sensitivity, said the memos were "ugly" and could embarrass the CIA. Other officials predicted they would fuel demands for a "truth commission" on torture.

I don't want just truth commissions, I want all who were involved in these " 'enhanced' interrogation techniques" to be arrested. And charged with Crimes Against Humanity.

Dear Mr. President, Fire Geithner and Bernanke.

That's right, fire them. Then have your new Attorney General issue warrants for their arrest. For treason. Their policies of continuing the bailouts of the banks can only give aid and comfort to Russia, China and the Arab countries, all of who hate us.

Mish agrees.

Dear Mr. President, With All Due Respect...

Dear Mr. President, I read your New Era $3.6 Trillion Budget Proposal. I also listened to your
speech Tuesday night. You made a great campaign speech. However, the campaign is over. You won. And the reason you won is you offered hope as well as a promise
of change.

With all due respect Mr. President, Tim Geithner and Ben Bernanke are
offering the same policies as President Bush and Secretary Paulson. Those
policies are to bail out banks regardless of cost to taxpayers. Mr. President,
it's hard enough to overlook Geithner's tax indiscretions. Mr. President, it is
harder still. if not impossible, to ignore the fact that neither Geithner nor
Bernanke saw this coming. [Ed-M: but they knew it's been here since the first collapse of an old institution last MArch: Bear Stearns.] Yet amazingly they are both cock sure of the solution. Even more amazing is the fact that solution changes every day.

With all due respect Mr. President, Geithner and Bernanke are a huge part
of the problem, and no part of the solution and the sooner you realize that the
better off this nation will be.

With all due respect Mr. President, your budget proposal is the same big
government spending as we saw under President Bush. The only difference is you
promised more spending and bigger government, while President Bush promised less
government and less spending and failed to deliver on either count.

With all due respect Mr. President, it is impossible to spend one's way out
of a problem, when the problem is reckless spending.

The Birds

Over at James Kunstler's "Clusterfuck Nation," someone posted an item about omens presented by flights of birds in ancient Rome, WRT inaugurations and getting major projects started.

Emerson taught that all words have their roots in nature. I was curious
what the roots, or etymology, are for the word "inauguration".

Here's what one online dictionary says: "1569, from Fr. inauguration
"installation, consecration," from L. inaugurationem (nom. inauguratio)
"consecration, installment under good omens," from inaugurare "take omens from
the flight of birds, consecrate or install when such omens are favorable," from
in- "on, in" + augurare "to act as an augur, predict" (see
augur/browse/augur)."I guess people used to inaugurate when the omens were
favorable from watching bird flights? Funny, last week we had a bird flight take
out an airplane in New York, causing it to crash in the Hudson River. Although
no one was killed, it was a very scarey and traumatic event. An omen?

If it's an omen of anything, it means that Pres. Barack H. Obama is the Gorbachev of the United States -- in other words, our last president as the country collapses.

Two Cartoons

The first one I thought of Chicken Little, who said to Henny Penny, Goosey Loosey and Foxy Loxy, "The sky is falling!" Well, a lot of left leaning people thought the sky was falling for eight long years are now cautiosly hoping that Obama will hold it up. Other people, too. As if one man can reverse all the consequences of the sins of the people in Washington, Wall Street, and the rest of Corporate America. Heh.

The second one was inspired by Elaine Meinel Supkis's many gnome drawings. Except this one looks like a portrait that hung on some gnome's wall!