Tag: finance

Via The Animal Spirits Page blog,

It should now be evident that America's foreign policy is to an extent being driven by our banking mess. Again and again, we see Washington, including Wall Street's handmaiden, the Fed, exporting monetary chaos implicitely in order to weaken the status of potentially competing reserve currencies:

• Wall Street sent a tsunami of bad AAA-rated mortgage debt to Europe, much to Germany, the locus of power for the Euro (and again, implicit admission of guilt is seen in the apparent fronting of billions of bailout dollars to the European banks by the Fed after the crisis);
• Washington has apparently fomented or supported a coup in the Ukraine that increases the likelihood of war in Europe dramatically therefore sending the gigantic pools of liquid financial assets in the world scurrying into the greenback and US Treasuries, which the Chinese have stopped gobbling up;
• the other factor is that the military-industrial complex needs war to get its funding, and when drone-bombing rag-heads can't provoke a serious attack, destabilizing a former Eastern bloc nation and provoking a somewhat justifiably paranoid Russian leader into military action guarantees at least a shot in the arm of crisis funding.

Russia has repeatedly stated over the past decades that an EU move on the Ukraine crosses a red line. The EU ignored the warning, and with the US's help and the ire of Ukrainians sick of a corrupt government crossed Putin's red line. What the Ukrainians want is democracy and relief from their corrupt plutocrats (see previous post's article by Paul Craig Roberts).

The US has no compelling strategic interest in the Ukraine, or in the Crimea remaining part of the Ukraine. Yes, the Ukraine has been looted by its oligarchs, just as Russia was, and just as the US is being looted by its oligarchs right now; incomes of a majority of American households are falling so the banks can collect on bad debts. It would be nice for people everywhere if they could break the grip of the plutocrats over their livelihoods. In the Ukraine, to substitute debt servitude to Western banks for the domination of the oligarchs would only accelerate the collapse of the EU. And it's not clear the EU, if it offers help, won't be ripped off by the oligarchs as well. The new government in the Ukraine has already increased the power of the oligarchs by giving them provinces to rule, so it's not clear the Western "rescuers" are even able to help solve the fundamental problem at all, and might end up losing their shirts again, as they have in Greece, Portugal, et al.

Until democratic governments around the world become strong enough to counteract the power of the plutocrats by taxing them, both their income and their wealth (as Sweden does) the revolving looting of sovereign governments and demolition of middle classes by the plutocrats and their corporations will continue.

A couple of posts ago I said the scariest thing I've heard recently was Catherine Anne Fitts saying what the world needs now is a global debt for equity swap. I should say I generally like Ms. Fitts' analysis and suspect she may even have misspoken when she made this comment. Such a move would concentrate ownership of the world's assets sufficiently to create even more of a Plantation Earth than we have currently.

She identified the problem, but not the solution. What the world needs now is a global jubilee, debt forgiveness. The debt that the Fed is shoving under the carpet via QE is what is known in banking circles as "bad debt." It is loans that never should have been made because they will never be repaid. In honest not crony capitalism such debts come out of the profits (as losses) of the banks that made them. In crony capitalism, with a central bank controlled by the banks, such debts are "paid back" by being monetized and put on the backs of the taxpayers either directly or through inflation.

The austerity programs Europe has put in place so that Wall Street and European banks can be paid back bad debts have destroyed more than one economy and more are probably yet to fall. (The idea promoted ten plus years ago of "convergence" of interest rates in the EU between periphery and core caused me to gag at the time.) Debt slavery to Western banks is not the answer. (China is apparently making similar mistakes; it will be interesting to see what they do with the bad debt. I suspect their strong central government will tell the bankers to go stuff it.) Ms. Fitts suggests that sooner or later the plutocrats will destroy the banks in order to buy them cheap and collect the rents themselves, canny suggestion indeed.

Chaos in the world = a strong dollar. Until it doesn't. Chaos has a way of being unpredictable.

Capitalism has killed democracy. "Free" markets dominated by monopolies and oligopolies are not what Adam Smith had in mind. It's time for democracy to be reborn. There are degrees of economic inequality that are simply immoral and destructive and humankind has the right to reject them. When the top 85 families own as much as the bottom 3.5 billion people, as recently reported, we have reached such a point.

via Zero Hedge http://ift.tt/Pr16Eg Tyler Durden

3,000 Americans around the world renounced their citizenship last year. CNN Money introduces us to five U.S. citizens who have given up their passports — or are thinking about it…

 

#1: "I threw up after renouncing"

Name: Donna-Lane Nelson, 71
Lives in: Geneva, Switzerland

I renounced my U.S. citizenship in 2011. After I did it, I was so emotional that I threw up outside the embassy.

During my renunciation, I broke down. It was like getting a divorce. America gave me my education, a good career path, and I came from a beautiful part of the country. This was very hard.

Before I took the last oath, I asked if I could change my mind. The embassy worker said maybe, with official permission. But I still went through with it.

My decision to renounce was triggered when my bank threatened to close my account because I was American. What would I do without a bank? Americans in Switzerland were having trouble with their investments, getting credit cards, and some weren't even getting loans.

I've been in Switzerland since 1990, and became a citizen in 2005, because I wanted the right to vote where I was living. The Swiss can tell I have an American accent, and I'm often explaining that I grew up in the U.S. and have a daughter who still lives in the Boston area.

Filing taxes from abroad had always been a real pain. I was double taxed on my full pension, but it didn't bother me so much to pay taxes — it was the annoying paperwork. I used to do my own taxes, but I started going to a professional when I learned about the new disclosure laws. I'm glad I did, because there were a lot of forms. Tax prep costs me about 1,000 Swiss francs ($1,123) a year.

#2: "We're ostracized for being American"

Name: Ezra Goldman, 28
Lives in: Dongguan, China

I was born a dual citizen of both the U.S. and Germany — the U.S. through my father, and Germany through my mother.

After graduating from college in 2008, I moved for work to Dongguan, China, and I've been here ever since.

Germany doesn't require me to report, file or pay taxes on my income earned abroad, even though I am a German citizen. But as an American citizen, I am required to file taxes on my worldwide income. I always knew that even as an expat, I would have to file.

I have a tax service in the U.S. handle it for me. There's just too much for me to possibly know what's going on with tax laws and regulations — I can't keep up with it. It costs me several hundred dollars every year, but if a tax expert can keep me in good standing and in compliance, then I see it as the single best investment I make every year.

I am increasingly conflicted about giving up my U.S. citizenship. I plan to live abroad for a while for my career, and I don't know when I'll move back. It doesn't make it any easier as there also seem to be more and more restrictions for expats — we're ostracized for being American.

On numerous occasions, I've gone to banks to talk about investment opportunities, and they will blatantly tell me, "We do offer them to our customers, but because you're American, those opportunities are not available." I've even had health insurance companies tell me they'd prefer I sign up as a German citizen.

Ultimately, I don't know what I'm going to do as time goes on, but I do know that I will always feel and be American, regardless of my passport.

#3: "I still feel American"
 
Name: Laurie Lautmann, 58
Lives in: Gisborne, New Zealand

I went traveling through the Pacific, and landed in New Zealand in my mid-20s. I just loved it, and ended up staying, buying a home, finding a partner — the whole works.

My partner, Frank, and I are pretty average middle class types. Frank is a local gym teacher, and I have a part-time job as a cleaner. Over the years, we have each separately owned our own businesses. Frank still has his, giving surfing lessons.

The tax obligations imposed by the U.S. drove us crazy! We live in a small town, and it was difficult to find an expert who knew the ins and outs of the U.S. tax system. When we did find a firm, it cost us more than 4,000 New Zealand dollars ($3,360) for them to do our U.S. taxes each year. We looked at the money we paid the accountants as the price we paid to retain our U.S. citizenship. But as we got older and U.S. tax laws became more convoluted, it just didn't seem worth it anymore.

The accountancy fee is the main reason why we both renounced our U.S. citizenship last year. It wasn't an easy decision — super stressful, and very emotional. But at the end of the day, I think it was the right thing for us.

We made an embassy appointment, all the time thinking long and hard about it. I was nervous during the long drive to the consulate in Auckland. I couldn't eat; I couldn't think; I couldn't sleep.

From the time that you're young, you pledge your allegiance to the flag at school, and you always hear the U.S. is the best country. And here we were, cutting off our ties to America.

I still feel American — it's where I grew up. If someone asks me what I am, well, hey, I'm an American! I can't say I'm a Kiwi, a New Zealander. I sound like an American, and I really am one. I just don't have the passport anymore.

#4: "Invasion of privacy"

Name: Christina Ammann, 56
Lives in: Belp, Switzerland

When you're an American — and I've always been patriotic — it's extremely troubling to think about giving up your citizenship. But it's an option I am considering due to the invasive reach of the IRS and the U.S. government into my personal life.

I grew up in Phoenix, Arizona, and went to college in California. After I graduated, I entered the Peace Corps, stationed in Costa Rica. That's where I met my husband, who is Swiss. I moved to Switzerland to be with him in 1984, and received Swiss citizenship when we married.

The fact that I have signatory rights on my Swiss husband's financial accounts means that I must report them to the U.S. government, which I find quite unfair. I have no problem paying taxes — I have problems with reporting my non-American husband's assets. It's an invasion of privacy. I've always filed my taxes with the help of my brother, who is an accountant, but neither of us knew I had to report those accounts until my bank here sent me a letter about it.

We also didn't realize until recently that my daughter, who has U.S. citizenship through me, was required to file taxes after she turned 18 three years ago. I didn't think she had to, because her wages from a part-time job as a university student are very low.

I'm now working with a lawyer to sort this out. I think it will cost me in the range of $10,000 when it's all done, which hurts.

My conclusion is that new disclosure laws have caused an enormous amount of grief for an overwhelming majority of expats, just to get a few bad apples. They may be hiding millions, but the target persons are a small percentage of the millions of Americans abroad.

#5: "A burden for my son"

Name: Richard Sikes, 65
Lives in: Toronto, Canada

When I first moved to Europe in 1973, I didn't pay attention to my U.S. taxes for a few years. I am a native Oregonian who became something of a gypsy, living all over the continent — Ireland, England, Switzerland and Germany. I hardly earned anything at the time as a ballet dancer, so I figured I probably didn't owe taxes.

After a while, I started to make a bit more. I went straight to a U.S. consulate in Germany and filed about eight years of tax returns all at once. Even then, I don't recall owing any taxes. That put me in compliance, and since then, I've always filed my returns.

When my older son, now 21, was born in Germany, I applied for U.S. citizenship for him immediately, because I thought I might eventually return. As things worked out, I ended up in Canada — my wife's country and where I found a job in the IT industry. My oldest son and I now both have Canadian citizenship as well.

What I'm worried about these days is whether to apply for U.S. citizenship for my younger son, who is 16. He was born in Canada, and currently holds Canadian citizenship. He has the right to be an American citizen through me, and I wouldn't want to deny him that.

But do I want to impose a lifetime of paying to have U.S. tax returns prepared upon him? There are benefits — having a U.S. passport would make it easier for him to study and work in the U.S., if that's what he wants. But at his age, he doesn't know yet what career direction he wants to follow.

As for myself, I have considered renouncing my U.S. citizenship — my Canadian wife feels it is incredibly invasive that we are required to report our joint assets. But even after 40 years as an expat, I've kept my citizenship, because I still cherish the privilege of voting in national elections.

 

As we concluded previously:

The number of Americans that renounced their citizenship was 221 percent higher in 2013 than it was in 2012 [15].  That is a staggering figure, and it is symptomatic of a larger trend.  In recent years, a lot of really good people with very deep roots in this country have made the difficult decision to say goodbye to the United States permanently.  A few actually go to the trouble to renounce their citizenship, and that is mostly done for tax purposes.  But most willingly choose to leave America for other reasons.

 

Some were very serious when they said they would leave the U.S. if Barack Obama got a second term, some (such as Jesse Ventura [16]) are dismayed at how our freedoms and liberties are eroding and are alarmed at the rise of the Big Brother police state, some are absolutely disgusted by the social and moral decay that is eating away at the foundations of our society, and there are yet others that consider "the grass to be greener" on the other side of the planet.

 

Personally, I have a number of friends that have made the very hard decision to relocate their families thousands of miles away because they see what is coming to America and they believe that there isn't any hope of turning things around at this point.  I also have a lot of friends that are determined to stay in the United States no matter what.  When it comes to the future of America, almost everyone has a very strong opinion, and these are discussions that we need to start having.

Once upon a time, the United States was seen as "the land of opportunity" all over the globe and it seemed like everyone wanted to come here.

But now that is all changing.  As we have abandoned the principles that this country was founded upon, our economy has gone steadily downhill.

via Zero Hedge http://ift.tt/1i4ybzn Tyler Durden

Following a triumvirate of macro misses from AsiaPac (South Korea unemployment surged, Aussie confidence plunged, and Japanese inflation tumbled), the credit concerns running riot through the collateral underlying China's shadow banking system continue to crush Copper (and iron ore) prices. Copper is limit down in Shanghai at its lowest since July 2009 – these size moves have only occurred twice in history (Lehman and the US downgrade). Japanese stocks are ignoring any ramp efforts in USDJPY and US equity futures are fading qucikly with AUDJPY….

 

A sprinkling of headlines from this evening:

• South Korea unemployment jumped to 3.9% (exp 3.2%, prev 3.2%) – highest in 3 years
• Aussie Consumer Confidence dropped to 10-month lows
• Japanese Producer Price Inflation (Domestic Corporate Goods) MoM -0.2% – biggest deflation since Dec 2012 and YoY slowest since June 2013
• *JAPAN'S NIKKEI 225 DROPS BELOW 15,000
• *JAPAN'S NIKKEI 225 EXTENDS LOSSES TO 2%
• *COPPER IN SHANGHAI DROPS AS MUCH AS 5.2% TO 43,800 YUAN/MT (close to biggest drop since Dec 08)

 

Leaves copper echoinG Lehman and the US downgrade…

 

With the Nikkei unable to catch a bid from JPY ramp

 

and S&P futures continuing to track AUDJPY lower..

 

via Zero Hedge http://ift.tt/1frotHp Tyler Durden

Heinz was bought by Warren Buffett’s Berkshire Hathawy (and 3G Capital) in February 2013 for $28 billion. Since then the firm has cut 3,400 jobs and closed factories in an effort to boost profits as they pay current boss Bernardo Hees $9.2 million. However, as The BBC reports, the most stunning dichotomy in this tale is former Heinz CEO William Johnson’s $110.5 million payday for the final eight months of 2013… Perhaps more worryingly, Buffett has proclaimed this a “model for future buys.” When will the President replace Immelt with Buffett as his jobs advisors?

 

Via The BBC,

Former Heinz chief executive William Johnson received $110.5m (£66.1m) for the final eight months of 2013, the food firm disclosed in a filing to US regulators.

 

Current boss Bernardo Hees, who joined the firm in June, received $9.2m.

 

Mr Hees has cut more than 3,400 positions and closed factories in an effort to boost profits.

 

…

 

The firm, whose products include ketchup, baked beans, and a variety of frozen meals, reported a net loss of $71.7m from February to December 2013.

 

It announced the closure of three US plants in November and two European processing plants in February this year.

 

…

 

He also said the acquisition could serve as a model for future buys.

 

“With the Heinz purchase we created a partnership template that may be used by Berkshire in future acquisitions of size,” he wrote.

Another template the average citizen should be worried about?

via Zero Hedge http://ift.tt/1iyxJwD Tyler Durden

Submitted by Michael Snyder of The American Dream blog,

Is America the greatest nation on the planet?  Before you answer that question, you might want to check out the statistics that I have shared in this article first.  The reality is that the United States is in a deep state of decline, and it is getting harder to deny that fact with each passing day.  Mentally, emotionally, physically, spiritually and financially we are a train wreck.  Many that are “patriotic” attempt to put a happy face on our growing problems, but the truly patriotic thing to do is to admit just how bad things have gotten so that we can start finding solutions. 

If you truly love this country, then you should know that this nation needs a huge wake up call.  We have abandoned the values and the principles that early Americans held so dear, and as a result our society is a giant mess.  The following are 55 things about America that you may not know…

#1 We are supposed to have a government “of the people, by the people, for the people”, but only 25 percent of all Americans know how long U.S. Senators are elected for (6 years), and only 20 percent of all Americans know how many U.S. senators there are.

#2 Americans spend more on health care per capita than anyone else in the world by far, and yet we only rank 35th in life expectancy.

#3 Only one state in the entire country has an obesity rate of under 20 percent.  11 states have an obesity rate of over 30 percent.

#4 Of all the major industrialized nations, America is the most obese.  Mexico is #2.

#5 Back in 1962, only 13 percent of all Americans were obese, but it is being projected that 42 percent of all Americans could be obese by the year 2030.

#6 According to a new report from the U.S. Department of Agriculture, 31 percent of all food in the United States gets wasted.  In case you were wondering, that amounts to approximately 133 billion pounds of food a year.

#7 America has the highest incarceration rate and the largest total prison population in the entire world by a wide margin.

#8 In America, we even put 81-year-old women in prison for feeding the birds.

#9 According to a Newsweek survey taken a few years ago, 29 percent of all Americans could not even name the vice president.

#10 Americans spend more time sitting in traffic than anyone else in the world.

#11 60 percent of Americans report feeling “angry or irritable”.  Two years ago that number was at 50 percent.

#12 36 percent of Americans admit that they have yelled at a customer service agent during the past year.

#13 Only 30 percent of all Americans can tell you in what year the 9/11 attacks happened.

#14 There are more “deaths by reptile” in America than anywhere else in the world.

#15 Right now, 29 percent of all Americans under the age of 35 are living with their parents.

#16 Average SAT scores have been falling for years, and the level of education that our kids are receiving in most of our public schools is a total joke.

#17 According to a study conducted by the Mayo Clinic, nearly 70 percent of all Americans are on at least one prescription drug.  An astounding 20 percent of all Americans are on at least five prescription drugs.

#18 Americans spend more than 280 billion dollars on prescription drugs each year.

#19 According to the Centers for Disease Control and Prevention, doctors in the United States write more than 250 million prescriptions for antidepressants each year.

#20 Children in the United States are three times more likely to be prescribed antidepressants than children in Europe are.

#21 In the United States today, prescription painkillers kill more Americans than heroin and cocaine combined.

#22 America has the highest rate of illegal drug use on the entire planet.

#23 According to the federal government, the number of heroin addicts in the United States has more than doubled since 2002.

#24 It is hard to believe, but 56 percent of all Americans now have “subprime credit”.

#25 America exports more weapons to other countries than anyone else in the world.

#26 The United States has the most complicated tax system on the entire planet.

#27 Corruption is rampant throughout our society.  In fact, America leads the world in money given to fake charities.

#28 America leads the world in soft drink consumption by a wide margin.  Today, the average American drinks more than 600 sodas a year.

#29 In 2008, 53 percent of all Americans considered themselves to be “middle class”.  In 2014, only 44 percent of all Americans consider themselves to be “middle class”.

#30 70 percent of Americans do not “feel engaged or inspired at their jobs”.

#31 40 percent of all workers in the United States actually make less than what a full-time minimum wage worker made back in 1968 after you account for inflation.

#32 Back in the 1970s, about one out of every 50 Americans was on food stamps.  Today, about one out of every 6 Americans is on food stamps.

#33 The marriage rate in the United States has fallen to an all-time low.  Right now it is sitting at a yearly rate of 6.8 marriages per 1000 people.

#34 In the United States today, more than half of all couples “move in together” before they get married.

#35 America has the highest divorce rate in the world by a good margin.

#36 America has the highest percentage of one person households on the entire planet.

#37 100 years ago, 4.52 were living in the average U.S. household, but now the average U.S. household only consists of 2.59 people.

#38 According to the Pew Research Center, only 51 percent of all American adults are currently married.  Back in 1960, 72 percent of all adults in the United States were married.

#39 For women under the age of 30 in the United States, more than half of all babies are being born out of wedlock.

#40 At this point, approximately one out of every three children in the United States lives in a home without a father.

#41 In 1970, the average woman had her first child when she was 21.4 years old.  Now the average woman has her first child when she is 25.6 years old.

#42 America has the highest teen pregnancy rate in the world by a very wide margin.

#43 Approximately one out of every four teen girls in the United States has at least one sexually transmitted disease.

#44 America has the highest STD infection rate in the entire industrialized world.

#45 According to the latest figures released by the U.S. Centers for Disease Control, there are 20 million new sexually-transmitted infections in the United States every single year, and Americans in the 15 to 24-year-old age range account for approximately 50 percent of those new sexually-transmitted infections.

#46 As I wrote about recently, there are 747,408 registered sex offenders in the U.S. according to the National Center for Missing & Exploited Children.

#47 America produces more pornography than any other nation in the world.

#48 America has the most lawyers per capita in the entire world.

#49 If you choose to be a “Constitutionalist” in America today, you may get labeled as a potential terrorist by the U.S. government.

#50 America has the largest national debt in the history of the world.  Back in 1980, the U.S. national debt was less than one trillion dollars.  Today, it is over 17 trillion dollars.

#51 According to the Congressional Budget Office, interest payments on the national debt will nearly quadruple over the next ten years.

#52 Americans spend more money on elections than anyone else does in the world by a very wide margin.

#53 65 percent of Americans are dissatisfied “with the U.S. system of government and its effectiveness”.  That is the highest level of dissatisfaction that Gallup has ever recorded.

#54 Only 8 percent of Americans believe that Congress is doing a “good” or “excellent” job.

#55 70 percent of Americans do not have confidence that the federal government will “make progress on the important problems and issues facing the country in 2014.”

via Zero Hedge http://ift.tt/1kgrueh Tyler Durden

And to think, all this medieval, zombie defense splendour can be yours for under $1 million!

 

 

Widely known as simply The Castle, this majestic 15,000+ square foot residence on 10 acres will easily accommodate gatherings of 100. Create your own masterpiece within the flexible floor plan. Elevator ready. Potential for caretaker or staff apartments, banquet space or ballrooms, and a drive-in garage space which could accommodate a catering kitchen. Multiple living spaces, powder rooms, and huge unfinished basement await.

 

Plenty of room for storing food (or playing chess)

 

Upstairs very similar to downstairs… but flexible

 

Kitchen needs work…

 

Dungeon?

 

Bath – with defensive views…

 

Panic Room/Garage…

 

Not fully fortified…

 

This 2002-built, 8-bedroom, 8-bath single-family detached property in Rockwall, TX can be yours for a mere $949,000….

 

h/t Muppet Pimp

via Zero Hedge http://ift.tt/1iyq3uj Tyler Durden

It May be time for Obama to explain to Putin the whole thing about “costs” and “red lines” one more time, maybe over a two hour phone call this time so the former KGB spy finally gets it, because while Russia has been seemingly confused for the past two weeks, Moscow just successfully annexed Crimea, without spilling a drop of blood. Which is what Ukraine essentially just confirmed after its acting president, who attained his position after a violent coup and remains unrecognized by Russia, told AFP in an exclusive interview saying Ukraine will not attempt a military move to prevent the southern Crimean peninsula’s breakaway in order not to expose its eastern border.

From AFP:

“We cannot launch a military operation in Crimea, as we would expose the eastern border and Ukraine would not be protected,” Turchynov said, as Crimea prepares to vote in a referendum Sunday on becoming part of Russia.

 

Crimea’s upcoming referendum is a “sham” whose results will be fixed in Moscow, Turchynov told AFP.

 

“What they call the referendum will not happen in Crimea but in the offices of the Kremlin,” Turchynov said ahead of Sunday’s vote and hours after the pro-Russian authorities in Crimea voted for full independence from Ukraine.

So with Crimea down, as Putin prepares for his strategic endgoal – splitting the country in two and annexing the East in an identical fashion – the US strikes back:

• HOUSE PASSES RESOLUTION SEEKING SANCTIONS AGAINST RUSSIA
• HOUSE VOTES 402-7 FOR NON-BINDING RESOLUTION ON UKRAINE

Surelt this time Putin will lose some sleep, perhaps over all the laughter.

via Zero Hedge http://ift.tt/1iygrQd Tyler Durden

Having been vociferous over her support for the NSA’s domestic espionage programs, we couldn’t help but see the ironic hypocrisy of Senator Diane Feinstein’s accusations that the CIA secretly removed documents from computers used by her panel to investigate a controversial interrogation program. As WaPo reports, Feinstein “is not taking lightly” the fact that the CIA appears to have violated the Fourth Amendment, which bars unreasonable searches and seizures, as well as various federal laws and a presidential executive order that prevents the agency from conducting domestic searches and surveillance. President Obama has since expressed “great confidence” in CIA chief John Brennan (unless of course he crossed a red line).

The irony and hypocrisy begins… (Via WaPo),

The head of the Senate Intelligence Committee on Tuesday sharply accused the CIA of violating federal law and undermining the constitutional principle of congressional oversight as she detailed publicly for the first time how the agency secretly removed documents from computers used by her panel to investigate a controversial interrogation program.

 

Sen. Dianne Feinstein (D-Calif.) said that the situation amounted to attempted intimidation of congressional investigators, adding: “I am not taking it lightly.”

 

…

 

She confirmed that an internal agency investigation of the action has been referred to the Justice Department for possible criminal prosecution. And she said that the CIA appears to have violated the Fourth Amendment, which bars unreasonable searches and seizures, as well as various federal laws and a presidential executive order that prevents the agency from conducting domestic searches and surveillance.

 

She has sought an apology and recognition that the CIA search of the committee’s computers was inappropriate, she said. “I have received neither,” she added.

CIA chief Brennan is defending his agency’s role:

the agency did nothing wrong and “has tried to work as collaboratively as possible” with the Senate committee. He said he would defer to a Justice Department investigation and wait for the facts to come out.

 

Brennan said he wants any historical record of the program to be accurate and balanced and said the CIA was not trying to thwart its progression or release.

 

“The CIA agrees with many findings in the report and disagrees with others,” he said.

 

Asked if he would resign if the CIA was found to be in the wrong, Brennan said he would let the president decide his fate.

 

“If I did something wrong, I will go to the president,” the CIA director said. “He is the one who can ask me to stay or to go.”

And in response to this:

• WHITE HOUSE SAYS PRESIDENT BARACK OBAMA HAS “GREAT CONFIDENCE” IN CIA CHIEF JOHN BRENNAN EVEN AS KEY SENATOR ACCUSES AGENCY OF SPYING ON CONGRESS

via Zero Hedge http://ift.tt/1iygpHY Tyler Durden

With Venezuela declaring war on the black-market dollar (and any and all capitalist free-market activity that produces margins above government mandates) the stories of empty shelves of toilet paper and food continue – as do the bloody protests (despite President Maduro’s proclamation that the ‘terrorists’ have been beaten).

 

#FullCommunism CC: @JAMyerson #SOSVenezuela http://ift.tt/NYi7F0

— Bill O’Keefe (@DefendWallSt) March 11, 2014

But to truly get a sense of life in Venezuela, the following image may bring back ugly memories for some…

 

 

People is marked like this in #Venezuela to be able to buy food http://ift.tt/1cvk075

— Roberto Rodríguez M. (@esosiquetetengo) March 8, 2014

via Zero Hedge http://ift.tt/1epMGcN Tyler Durden

The news last week that bitcoin's founder had been sort-of/maybe/not-so-much “found” got ConvergExs's Nick Colas thinking about the importance of creation myths in business and economics. A key part of bitcoin's current appeal is anonymity, so the fact that the digital currency’s inventor is unknown highlights that central value proposition. The tech industry is full of creation myths that resonate with both general social messages and specific business models.  Hewlett and Packard, Jobs and Woz, Page and Brin – all began their businesses in garages, showing that anything is possible with a great idea. However, as Colas details below, the truth behind all these stories is, of course, far more complex than the idealized creation myths we tell about them.

The bitcoin story is the same, but with a twist.  It may be the first business/economic creation myth where technology, rather than a human, is the star of the show. As Colas concludes, in a decentralized and tech-driven world, we are all Spartacus.

Via ConvergEx's Nick Colas,
 
“In the beginning, God created the heavens and the earth.”  That, of course, is the first line of Genesis.  It follows the rule all good journalists know by heart: don’t bury the lead (except they call is a lede – don’t ask).  God made everything, and the next 26 verses outline the famous six days of creation.  In Chapter 2, you get Adam and Eve; Chapter 3 gives us the banishment from Eden.  In just a few hundred words, you essentially get the story of everything on planet Earth in one tidy story of creation.  Done and dusted, as the saying goes.
 
Creation myths, of which Genesis is perhaps the most famous example, explain a society’s central values.  In religion, they outline the supernatural forces at work in creating our world.  In business, creation stories reinforce the role of the individual as a societal agent of change and speak to a core audience of customers.  They are the bedrock for what marketers call “Brand” and the source waters for Wall Street’s “shareholder value”.
 
Consider the following examples of business creation myths:

Bill Hewlett and Dave Packard built their first product in 1939 – an innovative audio oscillator – in Packard’s garage. The two had met at Stanford University – both were on the football team.  The company they formed, using their two names, survives to this day.

 

Fast forward to 2006, and two other Stanford alums named Larry Paige and Sergey Brin set up shop in a Menlo Park, CA garage just 2 miles from the site of the Hewlett and Packard’s original location.  The only difference: they already had $1 million in seed funding for Google, versus the $500 HP had when they started to ship their first product.  That would be $8,400 in today’s money.

 

Eleven miles from the HP garage sits 11161 Crist Drive is Los Altos CA.  This is where Steve Jobs and Steve Wozniak started Apple Computer in 1976.  Don’t go looking for it under that address, however – the house number is now 2066.  And yes, the garage is still there too.

 

In Facebook’s creation story as told in the movie The Social Network, Mark Zuckerberg gets dumped, gets drunk, and decides to build a ranking site for Harvard students.  The truth is, apparently, not as clean.  No girlfriend involved, but a good story nonetheless.

 

Some 20-somethings have a dinner party in San Francisco in 2005.  The host, Steve Chen, and others take amusing videos during the evening.  Unable to find a place to host them online, the host builds Youtube.  In a 2006 Time interview with Chen reveals some fuzziness about this narrative, but – again – a great creation myth totally in concert with how many users still engage with the site.

All these commercial creation myths share two common factors: humble beginnings and individuals with a vision to make something new.  When they succeed, we celebrate their foresight and dedication.  The success of a Steve Jobs or a Hewlett/Packard is an integral part of how we view a capitalist and free society – the doors of opportunity are open for anyone with a good idea and a lot of persistence.  Yes, the tech-focused world of the 21st century may distribute its wealth with increasing asymmetry.  As long as you have a garage, however, you may still have a shot at success.
 
At the same time, we are in the middle of a societal reset on the garage-and-a-dream creation myth, for consider the events of the last week in bitcoin.  We’ve been writing about this online crypto-currency for the last year, largely because we think that its rise to prominence says a lot about how society’s relationship with technology has evolved in the last few years.  The latest storyline that proves out this thesis goes like this:

On March 6th, Newsweek published an article which claimed that bitcoin’s inventor was a 64 year old Californian named Dorian Nakamoto.  His original name was Satoshi, and that is the name used by the author of the posting outlining the structure and coding behind bitcoin five years ago.  Everyone from journalists to bitcoin’s earliest adopters believed Satoshi Nakamoto was pseudonym, so it came a shock that he was relatively easy to find and that Newsweek, rather than a tech publication, could identify him.

 

Anonymity has been a part of bitcoin’s core value since inception.  Having an untraceable founder fit very well into its own creation myth: that technology can engender a level of public trust if it is open and accessible to anyone with the skills to operate it.  It doesn’t matter that you can’t talk to man or woman who wrote the original code.  Read it for yourself and, if you like it, run it for free.  If not, don’t.

 

Bitcoin’s creation myth stands in stark contrast to institutions like the U.S. Federal Reserve.  Founded in 1913 as a response to the Panic of 1907, its basic framework was set at a secret meeting of key bankers and Senator Nelson Aldrich.  The setting – a remote island of the coast of Georgia.  Participants got there in trains with the windows blacked out to prevent anyone seeing who might be aboard.  Oh, and Aldrich’s daughter was married to a prominent member of the Rockefeller family.  And he was Treasurer of the Freemasons chapter in Rhode Island.  Yes, the Fed has become more open in the last century, but as far as creation myths go, it is about as open as a bank vault at midnight.

A funny thing happened to bitcoin’s price in the days after Newsweek “Outed” Nakamoto: nothing much.  On March 6th, it was trading for $660-680 – about $8.1 billion in total value.   As I write this note, it goes for about $640.  That might sound like a large move, but in bitcoin land that is equivalent to an afternoon nap.  Bitcoin’s founder has, by some accounts, 6% of all the currency as a legacy of his early involvement.  This is not a liquid market, and that much visible supply should have depressed prices further.
 
And then there is the man himself, who now denies any involvement with bitcoin.  He hustles reporters for lunch. He likes model trains.  And, perhaps the most damning bit in the youth-oriented tech culture of today, he is 64 years old.  At least his house appears to have a garage, tucked in at the back of the modest property.  Aside from that, however, his oddball reclusiveness is distinctly at odds with the standard creation myth so many others have successfully travelled.
 
And therein lies the lesson from the last week: there’s a new myth in town, and it’s not about people anymore.  Bitcoin’s power to hold the imagination of its users has nothing to do with its creator.  The price action tells you that.  If Newsweek’s man is really THE Satoshi, no one cares that he likes model trains and appears a bit confused.  And if he isn’t, no one seems to care either.
 
That’s not to say that the standard “Person with a dream and garage” creation myth is obsolete.  We’ll always love the plucky underdog with a clever idea.  Rather, our faith in technology has reached a Gladwell-style tipping point, at least for some ideas.  Bitcoin may be early to this new approach to the business creation myth, but it certainly won’t be the last.  The next big thing – especially in peer-to-peer systems – may well come from a garage.  You just won’t know who is inside.

via Zero Hedge http://ift.tt/1oKffGU Tyler Durden