One Chart Showing Who's Really In Control

Submitted by Simon Black of Sovereign Man blog,

Check out this chart below. It’s a graph of total US tax revenue as a percentage of the money supply, since 1900.

For example, in 1928, at the peak of the Roaring 20s, US money supply (M2) was $46.4 billion. That same year, the US government took in $3.9 billion in tax revenue.

So in 1928, tax revenue was 8.4% of the money supply.

In contrast, at the height of World War II in 1944, US tax revenue had increased to $42.4 billion. But money supply had also grown substantially, to $106.8 billion.

So in 1944, tax revenue was 39.74% of money supply.

11072013Chart1 This one chart shows you whos really in control

You can see from this chart that over the last 113 years, tax revenue as a percentage of the nation’s money supply has swung wildly, from as little as 3.65% to over 40%.

But something interesting happened in the 1970s.

1971 was a bifurcation point, and this model went from chaotic to stable. Since 1971, in fact, US tax revenue as a percentage of money supply has been almost a constant, steady 20%.

You can see this graphically below as we zoom in on the period from 1971 through 2013– the trend line is very flat.

11072013Chart2 This one chart shows you whos really in control

What does this mean? Remember– 1971 was the year that Richard Nixon severed the dollar’s convertibility to gold once and for all.

And in doing so, he handed unchecked, unrestrained, total control of the money supply to the Federal Reserve.

That’s what makes this data so interesting.

Prior to 1971, there was ZERO correlation between US tax revenue and money supply. Yet almost immediately after they handed the last bit of monetary control to the Federal Reserve, suddenly a very tight correlation emerged.

Furthermore, since 1971, marginal tax rates and tax brackets have been all over the board.

In the 70s, for example, the highest marginal tax was a whopping 70%. In the 80s it dropped to 28%.

And yet, the entire time, total US tax revenue has remained very tightly correlated to the money supply.

The conclusion is simple: People think they’re living in some kind of democratic republic. But the politicians they elect have zero control.

It doesn’t matter who you elect, what the politicians do, or how high/low they set tax rates. They could tax the rich. They could destroy the middle class. It doesn’t matter.

The fiscal revenues in the Land of the Free rest exclusively in the hands of a tiny banking elite. Everything else is just an illusion to conceal the truth… and make people think that they’re in control.


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/cJ4NJno1Pi8/story01.htm Tyler Durden

One Chart Showing Who’s Really In Control

Submitted by Simon Black of Sovereign Man blog,

Check out this chart below. It’s a graph of total US tax revenue as a percentage of the money supply, since 1900.

For example, in 1928, at the peak of the Roaring 20s, US money supply (M2) was $46.4 billion. That same year, the US government took in $3.9 billion in tax revenue.

So in 1928, tax revenue was 8.4% of the money supply.

In contrast, at the height of World War II in 1944, US tax revenue had increased to $42.4 billion. But money supply had also grown substantially, to $106.8 billion.

So in 1944, tax revenue was 39.74% of money supply.

11072013Chart1 This one chart shows you whos really in control

You can see from this chart that over the last 113 years, tax revenue as a percentage of the nation’s money supply has swung wildly, from as little as 3.65% to over 40%.

But something interesting happened in the 1970s.

1971 was a bifurcation point, and this model went from chaotic to stable. Since 1971, in fact, US tax revenue as a percentage of money supply has been almost a constant, steady 20%.

You can see this graphically below as we zoom in on the period from 1971 through 2013– the trend line is very flat.

11072013Chart2 This one chart shows you whos really in control

What does this mean? Remember– 1971 was the year that Richard Nixon severed the dollar’s convertibility to gold once and for all.

And in doing so, he handed unchecked, unrestrained, total control of the money supply to the Federal Reserve.

That’s what makes this data so interesting.

Prior to 1971, there was ZERO correlation between US tax revenue and money supply. Yet almost immediately after they handed the last bit of monetary control to the Federal Reserve, suddenly a very tight correlation emerged.

Furthermore, since 1971, marginal tax rates and tax brackets have been all over the board.

In the 70s, for example, the highest marginal tax was a whopping 70%. In the 80s it dropped to 28%.

And yet, the entire time, total US tax revenue has remained very tightly correlated to the money supply.

The conclusion is simple: People think they’re living in some kind of democratic republic. But the politicians they elect have zero control.

It doesn’t matter who you elect, what the politicians do, or how high/low they set tax rates. They could tax the rich. They could destroy the middle class. It doesn’t matter.

The fiscal revenues in the Land of the Free rest exclusively in the hands of a tiny banking elite. Everything else is just an illusion to conceal the truth… and make people think that they’re in control.


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/cJ4NJno1Pi8/story01.htm Tyler Durden

British Spy Chiefs Appear Before MPs, Sound Like American Counterparts

Today the heads of British security agencies MI5,
MI6, and GCHQ were questioned by the Intelligence and
Security Committee
, something that usually occurs in
private.

During the hearing MI5 Director General Andrew Parker claimed
that 34 terrorist plots have been disrupted since the 2005
bombings in London
, MI6 chief Sir John Sawers said that “our
adversaries were rubbing their hands with glee,” and GCHQ Director
Sir Iain Lobban told the committee that “We don’t want to delve
into innocent emails and phone calls,” and that some people being
monitored have discussed different ways to communicate since
Snowden’s leaks.

Of course, similar sorts of justifications and complaints
relating to surveillance have been heard before on this side of the
Atlantic. NSA chief Gen. Keith Alexander claimed that surveillance
programs have prevented
“dozens”
of terrorist attacks. President Obama said that “at
least fifty” plots had been averted thanks to surveillance, a claim
that is backed up
with little evidence
.

Rep. Mike Rogers (R-Mich.) and Sen. Saxby Chambliss (R.Ga.)

have claimed
 that terrorists have been changing their
behavior since the leaks, a claim not unlike the one made by
Lobban.

The hearing in the U.K. comes in the wake of a number of
controversies surrounding the British intelligence community that
have emerged since the publication of Edward Snowden’s
revelations.

Earlier this week the British ambassador in Berlin was summoned
by the
German foreign ministry
after reporting, based in part on
Snowden’s revelations, emerged alleging that the British had been
using its embassy to spy on the German government.

Snowden’s leaked information also revealed information on the

Tempora program
run by GCHQ, which allows the agency to access
personal data online, as explained by Philip Bump at
The Atlantic
:

Working closely with America’s National Security Agency, the
GCHQ is about halfway done implementing “Project Tempora.”
Comprised of two parts, suggestively dubbed “Mastering the
Internet” and “Global Telecoms Exploitation,” the project aims to
eventually allow the agency (and its partner) to survey over 90
percent of the cables that route through the United Kingdom,
pulling data from 400 at once. “As of last year,” the Guardian
reports, “the agency had gone half way, attaching probes to 200
fibre-optic cables each with a capacity of 10 gigabits per second.
In theory, that gave GCHQ access to a flow of 21.6 petabytes in a
day, equivalent to 192 times the British Library’s entire book
collection.” Full content of transmissions is preserved for three
days andmetadata for 30. Between them, the GCHQ and NSA have 550
analysts poring over the data — and 850,000 people with top secret
clearance can access it. We’ve known for weeks that the NSA shares
its PRISM data with the UK; now we know it also goes in
reverse.

Read more from Reason.com on the NSA and Edward Snowden here and here

from Hit & Run http://reason.com/blog/2013/11/07/british-spy-chiefs-appear-before-mps-sou
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If You Live In Illinois, Retire Now! (Or Move To Wisconsin)

Across the 50 states, the Bloomberg Muni team has collected the government financial statistics and adjudged the most (and least) under-funded pension plans. Wisconsin is least under-funded with a 99.91% funding ratio (beaten by the District of Columbia’s ‘over-funding’ at 106.92%) with Illinois the most under-funded at a measly 40.37% funding ratio… It seems only one choice is left for those far from retirement in Illinois… move!

 

The funding ratio provides an indication of the financial resources available to meet current and future pension obligations. Percentages were calculated by dividing the actuarial value of plan assets by the projected benefit obligation. Where specific data were missing in the consolidated reported totals, the pension funds were contacted directly.

 

Via Bloomberg Brief


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/uL0963ODZz4/story01.htm Tyler Durden

Democrats Develop Obamacare Trust Issues

There wasn’t much genuinely new information to be
found at yesterday’s congressional hearing on Obamacare. Health and
Human Services Secretary Kathleen Sebelius offered little more than
canned defenses of the administration and more
promises
to fix what has so evidently gone wrong with the
rollout of the law’s technical infrastructure.

But here’s something we did see highlighted in a revealing
way:  The administration’s credibility on health care issues
has been badly damaged. And Sebelius, in particular, appears not to
be trusted, even by some in her own party.

Republican questioning focused heavily on the millions of
insurance plan cancellations that are happening all over the
country right now—and the contrast with President Obama’s repeated
promise that anyone who liked his or her health plan could keep
that plan.

Sen. John Cornyn (R-Tx.)
asked
Sebelius whether she thought President Obama’s statement
was true.  “Well, we know that lying to Congress is a crime,
but unfortunately lying to the American people is not. I’d just
like to ask you a simple true-or-false question. Is that statement
on the White House website true or is it false?”

Her response was to try to challenge the framing of the
question: “Sir, I think the statement is that…” Cornyn didn’t
wait to find out what she thought the statement in question was. He
cut her off, asking again: “Is it true or is it false, Madame
Secretary?”

She never directly answered the question, according to the AP
account. Instead she said that “a vast majority” of people who
currently have job-based insurance would be allowed to keep their
plans, as would a majority of people who get individual coverage.
Cornyn finished the exchange by asking the record to “note that you
have refused to answer my question whether it’s true or false.”

It was clearly a question that Sebelius didn’t want to answer,
at least not directly. Other Republican legislators pressed her on
the point, but the closest she came to an actual response regarding
how Obama’s multiple promises that individuals could keep health
plans they liked was when she
said
“The president’s promise was written into the law from Day
One, and that was the grandfather clause.”

At best that’s a non-answer. The president’s promise wasn’t just
written into law. It was also delivered verbally in unmistakably
clear language on
at least three dozen occasions
. And what he said was: If you
like your health plan, you can keep it, period. The law’s
grandfathering provisions, meanwhile, were written narrowly and
strictly—ensuring that few plans would actually be able to retain
their protected status. Democrats were warned that the narrowness
of the rules would result in people losing existing plans. They
went ahead anyway. That’s part of the reason why people are
upset.

That’s not the only administration deception that came up during
yesterday’s hearing. And Republicans were the only ones to
criticize the administration’s botched rollout of the
exchanges.

Regarding the failure of the exchange portals, Sen. Debbie
Stabenow (D-Mich.) told Sebelius that there are “no words to even
describe the frustration that all of us have.”

Sen. Max Baucus, one of the law’s Democratic authors,
referencing his pre-launch warning that the exchanges could turn
into a “train wreck” if the administration didn’t get a better
handle on the particulars of the implementation process, chastised
Sebelius for failing to acknowledge the project’s problems
earlier—and for insisting that implementation was on
track.

“Make no mistake, I believe in this law. I spent two years of my
life working on the Affordable Care Act. There is nothing I want
more to succeed,” he said,
according
to The Washington Post. “But months ago I
warned that if implementation did not improve, the marketplace
might struggle…We heard multiple times that everything was on
track. We now know that was not the case.”

Baucus
walked back
his original train wreck remarks after they were
widely quoted by critics of the law. But here he’s making a charge
that’s arguably even more severe: He’s not just accusing the
administration of botching the rollout of the exchanges—he’s
accusing them of deceiving, or at least failing to inform, senior
elected officials in their own party regarding the status of the
implementation process, including one of the law’s own chief
legislative authors.

All Baucus wanted was reliable information. But that’s something
he feels as if he hasn’t gotten. “You’ve got to tell us what the
problems are,” he
said.
“The more you don’t tell us, the greater the problem is
going to be.” In imploring Sebelius to start being straight with
Democrats on the Hill, he was implicitly making the point that up
until now that’s not what she and the rest of the administration
had been doing.

That’s important—and revealing. Republicans and critics of the
law have never trusted the administration on Obamacare. But they
weren’t the only ones the White House misled, misinformed, or
simply kept in the dark throughout the implementation
process. Even senior Democratic legislators, for
example, were given no early hint that the law’s employer mandate
would be delayed; party leadership was reportedly given


just 30 minutes notice
before the announcement went
public.

And now some Democratic legislators are openly frustrated, and
skeptical, as well. They haven’t quite turned on the law yet. But
they’re wary of the people in charge of implementing it.

To put it another way: They still like Obamacare, but they don’t
quite trust the Obama administration. The problem, as the law’s
supporters are rapidly discovering, is that even with the best of
reforms, bad implementation tends to make for bad law. Which means
that if the administration doesn’t start displaying some very basic
technical and managerial competence, Democrats may increasingly
find that they like the law in theory, but aren’t so thrilled with
it in practice. 

from Hit & Run http://reason.com/blog/2013/11/07/democrats-develop-obamacare-trust-issues
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Twitter Sings Happy Song with IPO, Telecoms Paid by CIA for Data Collection, Toronto’s Rob Ford Becoming Household Name: P.M. Links

  • Buy Twitter Stock #ThreeWordInvestmentTipsTwitter’s
    initial public offering
    today is a far cry from Facebook’s
    first-day disaster. It initially offered stocks at $26 a share, but
    its first trade came in at more than $45 a share.
  • Wondering why telecom companies aren’t objecting to handing
    over data to the feds? Money, of course. The CIA is paying AT&T
    more than
    $10 million a year
    for their assistance.
  • 250,000 Colorado residents will
    lose their current insurance coverage
    thanks to Obamacare.
  • Toronto Mayor Rob Ford continues his public transformation
    character into a Saturday Night Live character with a

    hilarious but also angry and violent rant
    that was secretly
    recorded and recently distributed.
  • Fearing (probably correctly) that New York City’s new mayor
    will drop the appeals against the implementation of stop-and-frisk
    reforms,
    police unions are asking permission to intervene
    and keep the
    challenge going.
  • Iranian officials say they’re being offered some relief from
    their
    crippling sanctions
    from Europe and America for their
    cooperation with efforts to scale back the country’s nuclear
    ambitions.

Get Reason.com and Reason 24/7
content 
widgets for your
websites.

Follow us on Facebook
and Twitter,
and don’t forget to
sign
up
 for Reason’s daily updates for more
content.

from Hit & Run http://reason.com/blog/2013/11/07/twitter-sings-happy-song-with-ipo-teleco
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J.D. Tuccille on Opting Out of Government Control

Exit signBalaji Srinivasan, a Stanford Universty
instructor and genomics entrepreneur, recently offered some
radically individualistic advice to aspiring tech innovators. He
warned that, despite (or maybe, because of) the liberating and
enriching qualities of technology in people’s lives, the tech
industry faces a backlash from old-line power centers. In response,
he said, technological innovators should publicly argue their case,
but also be prepared to exploit a market opportunity to help people
escape government control, no matter the law. In other words, to
hell with arguing for more freedom, let’s take it. That’s good
advice for all of us, writes J.D. Tuccille, if we can break with
old attitudes and embrace a willingness to defy authority.

View this article.

from Hit & Run http://reason.com/blog/2013/11/07/jd-tuccille-on-opting-out-of-government
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S&P Futures Plunge Most In Over 4 Months Intraday

While attention was focused on the #winning (TWTR) and #failing (NASDAQ and TSLA and so on)… the fact is that the S&P 500 futures market saw its largest collapse from high to low intraday since June 24th. While the told-you-so dance seems so inappropriate, equity markets' dump – seemingly triggered by more than one levered JPY carry trader getting a tap on the shoulder after Draghi's surprise – merely catches down to credit market's lack of exberance for the last 2 weeks (though there is still more room to drop). Stocks are at 12-day lows by the close with very litle BFTATH'ers stepping in as VIX broke back above 14.00% (highest close in over 3 weeks). FX markets were insanely volatile with early USD strength obliterated by JPY and EUR strength in the afternoon. Commodities slid lower on the day and bonds rallied – with 30Y outperformance unwinding some of the week's steepening. Stocks closed on their lows with the best volume in a month.

 

 

While we realize the irony of pulling out the deer on a day when the market is down barely over 1%, this is what happens when a deranged Princeton academic is let loose and left in control of the capital markets…

 

Trannies are the most off their highs but NASDAQ is now the worst performer off the debt-ceiling lows…

 

And Homebuilders and Financials are underperforming (though discretionary was ugly today)…

 

Equity markets playing catch down to credit…

 

FX markets were bananas…

 

and Treasuries saw 30Y outperforming – flattening much of the week's steepening…

 

and as an example of the disaster in momo – TSLA is down almost 30% from its highs…

 

Well..

 

Charts: Bloomberg

Bonus Chart: TWTR Closees at all-time low…

 

 


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/i1bHKpro2-k/story01.htm Tyler Durden

S&P Futures Plunge Most In Over 4 Months Intraday

While attention was focused on the #winning (TWTR) and #failing (NASDAQ and TSLA and so on)… the fact is that the S&P 500 futures market saw its largest collapse from high to low intraday since June 24th. While the told-you-so dance seems so inappropriate, equity markets' dump – seemingly triggered by more than one levered JPY carry trader getting a tap on the shoulder after Draghi's surprise – merely catches down to credit market's lack of exberance for the last 2 weeks (though there is still more room to drop). Stocks are at 12-day lows by the close with very litle BFTATH'ers stepping in as VIX broke back above 14.00% (highest close in over 3 weeks). FX markets were insanely volatile with early USD strength obliterated by JPY and EUR strength in the afternoon. Commodities slid lower on the day and bonds rallied – with 30Y outperformance unwinding some of the week's steepening. Stocks closed on their lows with the best volume in a month.

 

 

While we realize the irony of pulling out the deer on a day when the market is down barely over 1%, this is what happens when a deranged Princeton academic is let loose and left in control of the capital markets…

 

Trannies are the most off their highs but NASDAQ is now the worst performer off the debt-ceiling lows…

 

And Homebuilders and Financials are underperforming (though discretionary was ugly today)…

 

Equity markets playing catch down to credit…

 

FX markets were bananas…

 

and Treasuries saw 30Y outperforming – flattening much of the week's steepening…

 

and as an example of the disaster in momo – TSLA is down almost 30% from its highs…

 

Well..

 

Charts: Bloomberg

Bonus Chart: TWTR Closees at all-time low…

 

 


    



via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/i1bHKpro2-k/story01.htm Tyler Durden

How Many Americans Believe a Conspiracy Killed JFK?

Lucy van Pelt, acting alone, pulled away the football.As we approach the 50th
anniversary of John F. Kennedy’s death, Karlyn Bowman and Andrew
Rugg of the American Enterprise Institute have pulled together a

very useful paper
on the popularity of various conspiracy
theories over the last five decades. The authors assembled every
poll they could find since 1963 on the JFK, RFK, and MLK
assassinations, the Pearl Harbor and 9/11 attacks, Roswell,
Oklahoma City, and more — all sorts of conspiracy stories, from
the plausible (a Waco cover-up, Iraq war lies) to the loopy
(Holocaust denial, moon landing denial). For many of the topics,
several polls have been conducted over the years, allowing the
reader to track a theory’s popularity over time.

It’s a great resource, and it includes several surveys I’ve
never seen before. (I wish I’d had it at hand when I was writing my

book
about America’s conspiracy folklore.) It is also
refreshingly reluctant to draw sweeping conclusions about
conspiracy believers. “We don’t find compelling evidence from the
data in this document that particular demographic groups are
susceptible to a belief in conspiracy theories,” Bowman and Rugg
write. “It depends on the theory. Middle-aged Americans are more
likely to believe in the JFK assassination conspiracy than older or
younger ones. Young people and Democrats are most likely to
subscribe to conspiracy theories about 9/11. Women are more likely
to believe foul play was involved in Princess Diana’s death. While
the demographic data presented here are by no means exhaustive,
we’re hesitant to endorse what much of the literature concludes —
that the young and less educated are more prone to conspiratorial
instincts.”

The institute also produced a short video to release alongside
the paper. I have a few cameos in it:

from Hit & Run http://reason.com/blog/2013/11/07/how-many-americans-believe-a-conspiracy
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