Month: July 2014

Submitted by Michael Krieger of Liberty Blitzkrieg blog,

In the walls of the cubicle there were three orifices. To the right of the speakwrite, a small pneumatic tube for written messages, to the left, a larger one for newspapers; and in the side wall, within easy reach of Winston’s arm, a large oblong slit protected by a wire grating. This last was for the disposal of waste paper. Similar slits existed in thousands or tens of thousands throughout the building, not only in every room but at short intervals in every corridor. For some reason they were nicknamed memory holes. When one knew that any document was due for destruction, or even when one saw a scrap of waste paper lying about, it was an automatic action to lift the flap of the nearest memory hole and drop it in, whereupon it would be whirled away on a current of warm air to the enormous furnaces which were hidden somewhere in the recesses of the building.

 

He who controls the past controls the future. He who controls the present controls the past.

 

– From George Orwell’s 1984

The reason Big Brother and his band of technocrat authoritarians spend so much time and effort erasing history in the classic novel 1984, is because they are a bunch of total criminals and they know it. Their grip on power is made so much easier if the proles are kept ignorant, confused and in the dark. This strategy is not just fiction, it is the philosophy of tyrants and authoritarians throughout history.

While the internet is an amazing tool for communication and free speech, we must also be aware of how it can be abused by those in power who wish to whitewash history. For more on this epic struggle, read the post, Networks vs. Hierarchies: Which Will Win? Niall Furguson Weighs In. In it, Mr. Furguson explains that the biggest threat to networks overcoming hierarchies is if government technocrats are able to gain a hold of the technological tools we now use to communicate with each other. He fears this is already happening with the NSA’s PRISM program and the complicity of all the major tech companies in the agency’s unconstitutional spying.

So it appears Orwell’s feared “memory hole” has begun to emerge in Europe. This shouldn’t be seen as a surprise considering the region’s devastating youth unemployment rate and angst throughout society. The way censorship is gaining a foothold in the region is through something known as a “right to be forgotten” ruling issued by the European Court of Justice. This ruling states that Google must essentially delete “inadequate, irrelevant or no longer relevant” data from its results when a member of the public requests it.

Of course this is incredibly vague, and who is to decide what it “no longer relevant” anyway? Seems quite subjective. This is clearly an attempt to take a tool designed to decentralize information flow (the internet) and centralize and censor it. As such, it must be resisted at all costs.

So far, we know of two major media organizations that have been informed of deleted or censored articles, the BBC and the Guardian. The BBC story is the one that has received the most attention because the content related to former ex-Merrill Lynch CEO Stan O’Neal, who received a $161.5 million golden parachute compensation package after running the Wall Street firm into the ground and playing a key role in destroying the U.S. economy. The BBC reports that:

A blog I wrote in 2007 will no longer be findable when searching on Google in Europe.

Which means that to all intents and purposes the article has been removed from the public record, given that Google is the route to information and stories for most people.

So why has Google killed this example of my journalism?

 

Well it has responded to someone exercising his or her new “right to be forgotten”, following a ruling in May by the European Court of Justice that Google must delete “inadequate, irrelevant or no longer relevant” data from its results when a member of the public requests it.

 

Now in my blog, only one individual is named. He is Stan O’Neal, the former boss of the investment bank Merrill Lynch.

 

My column describes how O’Neal was forced out of Merrill after the investment bank suffered colossal losses on reckless investments it had made.

 

Is the data in it “inadequate, irrelevant or no longer relevant”?

 

Hmmm.

 

Most people would argue that it is highly relevant for the track record, good or bad, of a business leader to remain on the public record – especially someone widely seen as having played an important role in the worst financial crisis in living memory (Merrill went to the brink of collapse the following year, and was rescued by Bank of America).

 

To be fair to Google, it opposed the European court ruling.

 

Maybe I am a victim of teething problems. It is only a few days since the ruling has been implemented – and Google tells me that since then it has received a staggering 50,000 requests for articles to be removed from European searches.

 

I asked Google if I can appeal against the casting of my article into the oblivion of unsearchable internet data.

 

Google is getting back to me.

 

Since the original post, the author has provided an update:

So there have been some interesting developments in my encounter with the EU’s “Right to be Forgotten” rules.

 

It is now almost certain that the request for oblivion has come from someone who left a comment about the story.

 

So only Google searches including his or her name are now impossible.

 

Which means you can still find the article if you put in the name of Merrill’s ousted boss, “Stan O’Neal”.

 

In other words, what Google has done is not quite the assault on public-interest journalism that it might have seemed.

 

I disagree with his conclusion, and here is why. As is noted on this Yahoo post:

We don’t know whether it was O’Neal who asked that the link be removed. In fact, O’Neal’s name may be being dragged through the mud unnecessarily here. Peston believes it may be someone mentioned by readers in the comments section under his story about the ruling.

 

He suggests that as a “Peter Dragomer” search triggers the same disclosure that a result may have been censored, that perhaps it was not O’Neal who requested the deletion. In an amazing coincidence, the person posting as “Peter Dragomer” claims to be an ex-Merrill employee.

Of course, it’s not an amazing coincidence. In fact, going forward someone else can just post a comment below an article on a high profile person to get the article removed so that the person in the article can pretend it wasn’t his doing. In any event, someone who voluntarily leaves a comment should have zero say under this law. They went ahead and made the comment in the first place. Now you want an article article removed because of a comment you made? Beyond absurd.

Now here’s the Guardian’s take:

When you Google someone from within the EU, you no longer see what the search giant thinks is the most important and relevant information about an individual. You see the most important information the target of your search is not trying to hide.

 

Stark evidence of this fact, the result of a European court ruling that individuals had the right to remove material about themselves from search engine results, arrived in the Guardian’s inbox this morning, in the form of an automated notification that six Guardian articles have been scrubbed from search results.

 

The first six articles down the memory hole – there will likely be many more as the rich and powerful look to scrub up their online images, doubtless with the help of a new wave of “reputation management” firms – are a strange bunch.

 

The Guardian has no form of appeal against parts of its journalism being made all but impossible for most of Europe’s 368 million to find. The strange aspect of the ruling is all the content is still there: if you click the links in this article, you can read all the “disappeared” stories on this site. No one has suggested the stories weren’t true, fair or accurate. But still they are made hard for anyone to find.

 

As for Google itself, it’s clearly a reluctant participant in what effectively amounts to censorship. Whether for commercial or free speech reasons (or both), it’s informing sites when their content is blocked – perhaps in the hope that they will write about it. It’s taking requests literally: only the exact pages requested for removal vanish and only when you search for them by the specified name.

But this isn’t enough. The Guardian, like the rest of the media, regularly writes about things people have done which might not be illegal but raise serious political, moral or ethical questions – tax avoidance, for example. These should not be allowed to disappear: to do so is a huge, if indirect, challenge to press freedom. The ruling has created a stopwatch on free expression – our journalism can be found only until someone asks for it to be hidden.

 

Publishers can and should do more to fight back. One route may be legal action. Others may be looking for search tools and engines outside the EU. Quicker than that is a direct innovation: how about any time a news outlet gets a notification, it tweets a link to the article that’s just been disappeared. Would you follow @GdnVanished?

This last idea is actually a great one. Every time an article gets censored it should be highlighted. If we could get one Twitter account to aggregate all the deleted stories (or perhaps just the high profile ones) it could make the whole censorship campaign backfire as the stories would get even more press than they would have through regular searches. Ah…the possibilities.

Interestingly, due to all the controversy, a European Commission spokesman has come forth to criticize Google for removing the BBC article. You can’t make this stuff up. From the BBC:

Google’s decision to remove a BBC article from some of its search results was “not a good judgement”, a European Commission spokesman has said.

 

A link to an article by Robert Peston was taken down under the European court’s “right to be forgotten” ruling.

 

But Ryan Heath, spokesman for the European Commission’s vice-president, said he could not see a “reasonable public interest” for the action.

 

He said the ruling should not allow people to “Photoshop their lives”.

 

The BBC understands that Google is sifting through more than 250,000 web links people wanted removed.

Perhaps it wasn’t in “good judgment ” to issue this idiotic ruling in the first place. Just another government shit-show. As usual.

via Zero Hedge http://ift.tt/VRk1eG Tyler Durden

With Austrian bank contagion impacting European stocks on Friday, we thought it worth a look at the ‘recovering-out-of-the-crisis-all-is-well-and-stress-tests-will-prove-it’ European banks. It appears, having bid with both hands and feet for Europe’s peripheral debt – thus solidifying the very sovereign-financial-system linkages that were the cause of the European crisis contagion – Europe’s banks had the jam stolen from their donuts when Mario Draghi did not unveil a massive bond-buying scheme (by which they could offload their modestly haircut collateral at 100c on the euro, raise cash, take profits, and all live happily ever after). A TLTRO is no use to the banks who now know even the first sign of one dumping his domestic bonds will cause this illiquid monstrosity to collapse under its own weight. It is clear – as the following chart shows – that investors are quickly coming to that realization and exiting European bonds in a hurry.

Since Draghi failed to unveil QE, European banks have collapsed to one-year lows relative to world banks…

Of course, some knife-catching Bill-Miller-ite will come to the rescue, buying-the-dip – but as BNP’s Ian Richards notes,  

“The prospect of supporting material credit growth and better earnings revisions in the banking sector is further down the line than the market had hoped.”

Source: Bloomberg

via Zero Hedge http://ift.tt/1xDrag3 Tyler Durden

Submitted by Adam Taggart via Peak Prosperity,

Chris Martenson:    Welcome to this Peak Prosperity Podcast. I'm your host, Chris Martenson and today we are talking with the host of The Hidden Secrets of Money, noted speaker, best-selling author on monetary history and gold and silver investing, the CEO of GoldSilver.com—we are talking with Mike Maloney. Somebody who I consider to be both a fellow educator and a friend in this business. Welcome, Mike.

 

Mike Maloney:          It's great to be here, Chris.

 

Chris Martenson:    I don't have many regrets but one of them …

 

read more

via Zero Hedge http://ift.tt/1xDly5i Tyler Durden

What “harsh weather”, aka completely unpredictable cold snaps and snow during the winter were to Q1 US GDP, which somehow cratered from an expected 2.5% increase to a -2.9% collapse (a $200 billion negative swing in the US economy due to weather, let that sink in for a second), the Brazil world cup may be to the stock market. At least that is the following chart from Bloomberg, highlighting the “World Cup Syndrome” shows.

According to ECB data, workers everywhere—even financial types—are paying more attention to the games than to their jobs. One way of measuring the global epidemic of distraction is to look at plunges in stock market trading volumes. The European Central Bank analyzed data from the 2010 World Cup showing significant drops in trading during all games. The effect was especially pronounced when the traders’ own country was on the field.

And consider this: this analysis was done in 2010 when people actually still traded, as opposed to merely central banks transacting with vacuum tubes. One can only imagine the absolutely cratering in trading volumes in late June and early July, not only thanks to a record low VIX but also as nobody really pays attention to rigged stocks any more when at least football provides a somewhat less rigged diversion.

We can’t wait to find out how big is the cliff that bank revenues fell off in Q2 (and Q3) as their employees – largely oblivious to what happens to a “market” that is now purely on “up and to the right” autopilot – were much more focused on the action in the football stadium, where for now at least, there are no dark pools to ruin the fun.

via Zero Hedge http://ift.tt/1n6l58j Tyler Durden

Authored by Daniel McAdams via The Ron Paul Institute,

Global chessboard enthusiast Zbigniew Brzezinski has a plan for Ukraine. In a recent speech to the Woodrow Wilson Center, excerpted by the Atlantic Council, he argues forcefully in favor of the United States providing the Ukrainian military far more weapons. 

Under the guise of preventing a Russian invasion of Ukraine, which has been the rallying cry of those who seek more US involvement in the region, Brzezinski believes that the US must provide Ukraine with enough weapons to deter Russian aggression toward Ukraine.

The odds of defending against the invading Russian military being very low, Brzezinski has a different idea of how the US should arm the Kiev government.

Said the former National Security Advisor:

I feel that we should make it clear to the Ukrainians that if they are determined to resist, as they say they are and seemingly they are trying to do so (albeit not very effectively), we will provide them with anti-tank weapons, hand-held anti-tank weapons, hand-held rockets—weapons capable for use in urban short range fighting.

The US must provide urban warfare equipment to the Kiev government, he says, in order to forestall the impending Russian invasion.

But what else could a huge shipment of urban warfare weapons and the advisors that go with them be used for? 

Ethnic cleansing. 

We already see with the resumption of Kiev's attacks on the east, a sharp turn toward the targeting of civilian apartment blocks and non-military targets. We know from a recent United Nations report that more than 100,000 have already fled eastern Ukraine. The country's post-coup president, Petro Poroshenko, was very clear, ending the ceasefire (that wasn't much of a ceasefire) by stating that "We will attack and we will liberate our land!"

Does that mean liberating it from the "others" who do not accept rule by the post-coup government? Those who Kiev's prime minister Arseniy "Yats" Yatsenyuk has already called "subhumans"? 

Urban warfare equipment and training for the Kiev military machine would, as Russian political scientist Yevgeny Minchenko points out, mean "municipal infrastructure will be destroyed, leading to a humanitarian catastrophe." In his view, “[t]he war will continue, and people will gradually leave their homes. It will be bad for both sides, but neither one can stop now.”

Brzezinski has long advocated US domination of Ukraine to deprive Russia of any productive relationship with its neighbor. "Without Ukraine, Russia ceases to be a Eurasian empire,” he wrote in his 1997 book book, The Grand Chessboard. 

Ethnic cleansing of ethnic Russians and Russian speakers may be exactly what Brzezinski has in mind.

via Zero Hedge http://ift.tt/VR89cA Tyler Durden

Day after day, we are bombasted with asset-gatherers, academics, and status-quo-huggers demanding we BTFATH as ‘stocks are still cheap…” Some have even deferred modestly to the old standby “stocks are ‘fairly valued'” in a last lame effort to save what credibility they have left when they look themselves in the mirror. The fact is – no, stocks are not cheap (as we pointed out here, they are more expensive than at the peak of what Jim Bullard called an obvious bubble). However, still the shrill call of ‘stock-picker’s market’ rings out to encourage the placement of hard-earned savings into easily commissioned AUM. The fact is – as the 3 charts below show – nothing is cheap – Nothing!

There has never been so few (almost zero) stocks that are ‘cheap’ based on historical valuations…

Especially not in the USA…

More conservative? Prefer fixed income than risking capital in equity markets… nope, nothing cheap there either!

Reach for yield? Rational exuberance? Call it what you want… it won’t end well

Charts: Goldman Sachs

via Zero Hedge http://ift.tt/1je8Nvd Tyler Durden

Excerpted from John Hussman’s Weekly Comment,

Investors who feel that zero interest rate policy offers them “no choice” but to hold stocks are likely choosing to experience negative returns instead of zero. While millions of investors appear to have the same expectation that they will be able to sell before everyone else, the question “sell to whom?” will probably remain unanswered until it is too late.

…

It’s an unfortunate situation, but much of what investors view as “wealth” here is little but transitory quotes on a screen and blotches of ink on pieces of paper that have today’s date on them. Investors seem to have forgotten how that works. Few are likely to realize that apparent wealth by selling, and those that do will essentially be redistributing it from the investors who buy. Meanwhile, don’t confuse time to sell with opportunity to sell. Trading volume remains quite tepid, and the majority of that volume represents existing owners exchanging what they hold rather than outright entry and exit. The investors who successfully leave the equity market at current valuations will exit through a needle’s eye.

Implied volatility in S&P 500 index options fell to just 10.3% last week, indicating enormous complacency about potential risk. I’ve noted before that extreme overvalued, overbought, overbullish conditions tend to feature “unpleasant skew”: the raw probability of an advance is typically greater than the probability of a decline, so the market tends to achieve a series of successive but fairly marginal new highs, which can feel excruciating for investors in a defensive position. The “skew” part is that while the raw probability favors an advance, the remaining probability often features vertical drops that can wipe out weeks or months of market gains in a handful of trading days. We’ve certainly seen an unusual persistence of overvalued, overbought, overbullish conditions without consequence in recent quarters, but it is notable that the implied skew in S&P 500 index options has soared.

Indeed, the ratio of implied skew to implied volatility spiked to the highest level in history on Friday.

…

The ratio of market capitalization to GDP, which Warren Buffett (correctly) observed in a 2001 Fortune interview is “probably the single best measure of where valuations stand at any given moment” is now about 150% (not just 50%) above its pre-bubble norm, even imputing a rebound in Q2 GDP growth. Of course, Buffett also wrote “A group of lemmings looks like a pack of individualists compared with Wall Street when it gets a concept in its teeth” – which may explain why Wall Street seems so entranced with the concept of QE instead of actually doing the math.

The ratio of market capitalization to GDP, presented below on an inverted scale, is beyond every point in history except for the final quarter of 1999 and the first two quarters of 2000.

…

As The BIS warned recently…

“The risks of failing to act should not be underestimated.”

via Zero Hedge http://ift.tt/1qBVl4P Tyler Durden

Presented with no comment…

Source: Sunday Funnies

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

Having pointed out the ‘surges’ in the cost of your 4th of July burger at the behest of Greenspan and Bernanke, we thought a reflection on the soaring costs of ‘the most important meal of the day’ were in order. As the following chart illustrates in words and pictures even a PhD Fed economist or CNBC pretend-economist could understand – food-flation is here from breakfast through dinner (no matter how many iPads we try and eat).

h/t $hane Obata @sobata416

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

To complete the French triple whammy offensive against the US Dollar this weekend (first, French central banker Noyer suggesting de-dollarisation; second, French oil major Total's CEO "seeing no reason for the Petrodollar"), French finance minister Michel Sapin says "now is the right time to bolster the use of the euro" adding, more ominously for the dollar, "we sell ourselves aircraft in dollars. Is that really necessary? I don’t think so." Careful to avoid upsetting his 'allies' across the pond, Sapin followed up with the slam-dunk diplomacy, "This is not a fight against dollar imperialism," except, of course – that's exactly what it is… just as it was over 40 years ago when the French challenged Nixon.

Nope – no anti-dollar-imperiliasm here at all…

Single whammy:

• NOYER: BNP CASE WILL ENCOURAGE ‘DIVERSIFICATION’ FROM DOLLAR

Here is the full google translated segment:

Q. Doesn't the role of the dollar as an international currency create systemic risk?

 

Noyer: Beyond [the BNP] case, increased legal risks from the application of U.S. rules to all dollar transactions around the world will encourage a diversification from the dollar. BNP Paribas was the occasion for many observers to remember that there has been a number of sanctions and that there would certainly be others in the future. A movement to diversify the currencies used in international trade is inevitable. Trade between Europe and China does not need to use the dollar and may be read and fully paid in euros or renminbi. Walking towards a multipolar world is the natural monetary policy, since there are several major economic and monetary powerful ensembles. China has decided to develop the renminbi as a settlement currency. The Bank of France was behind the popular ECB-PBOC swap and we have just concluded a memorandum on the creation of a system of offshore renminbi clearing in Paris. We have very strong cooperation with the PBOC in this field. But these changes take time. We must not forget that it took decades after the United States became the world's largest economy for the dollar to replace the British pound as the first international currency. But the phenomenon of U.S. rules expanding to all USD-denominated transactions around the world can have an accelerating effect.

In other words, the head of the French central bank, and ECB member, Christian Noyer, just issued a direct threat to the world's reserve currency (for now), the US Dollar.

Double whammy:

• Total’s de Margerie Sees No Need for Dollars in Oil Purchases

Oil major Total's chief executive Christophe de Margerie was responding to questions about calls by French policymakers to find ways at EU level to bolster the use of the euro in international business following a record U.S. fine for BNP.

"There is no reason to pay for oil in dollars," he said. He said the fact that oil prices are quoted in dollars per barrel did not mean that payments actually had to be made in that currency.

So even a major beneficiary of the status quo appears to see the end in sight for the Petrodollar.

And now The Triple Whammy

• *FRANCE SAYS INCREASING EURO USE IS ISSUE OF 'GLOBAL BALANCE'
• *SAPIN SAYS EURO AREA NEEDS TO LEAD DISCUSSION ON DOLLAR USE
• *FRANCE NOT FIGHTING 'DOLLAR IMPERIALISM,' SAPIN SAYS (wo shy mention it?)

French Finance Minister Michel Sapin says that now is the right time to bolster the use of the euro in transactions outside the U.S. Sapin speaks in an interview with Bloomberg News in Aix-en-Provence, France.

“We sell ourselves aircraft in dollars. Is that really necessary? I don’t think so,” Sapin says, adding "I think a rebalancing is possible and necessary, not just regarding the euro but also for the big currencies of the emerging countries, which account for more and more of global trade."

 

“We can avoid the exchange rate risk, and that’s always useful. We can diminish financing costs in pricing more in other currencies,” Sapin says.

 

“This is not a fight against dollar imperialism,” Sapin says.

 

“It’s up to Europe, to the euro zone in particular, to lead this argument,” Sapin says.

 

As The FT reports, Mr Sapin said he would raise the need for a weightier alternative to the dollar with fellow eurozone finance ministers when they meet in Brussels on Monday, although he declined to go into detail about what practical steps might emerge.

As we showed only yesterday…(and have ever since 2010)… nothing lasts forever

Meanwhile, somewhere Putin is still laughing.

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