The debauchery on Capitol Hill continues unabated, with an amazing ninety-three new bills introduced yesterday in Congress, many of which attempt to do the same thing. How many of these bills do you think are Constitutional? (Answer: very few). Here are some of the worst:
HR1652 – To require institutions receiving certain assistance from the Troubled Asset Relief Program or the Federal Reserve to have employee bonus payment plans approved in advance of the payments being made. [Each member of Congress must operate in a bubble, and/or they're all hoping for the "credit" if their bill is passed. This is at least the fifth bill on this subject in the past three days!]
HR1650 – To enhance the oversight authority of the Comptroller General of the United States with respect to expenditures under the Troubled Asset Relief Program. [Yet another TARP regulation bill. The full text of the bill is not currently available, so I couldn't tell if it specifically mentions employee bonuses so I could add it to the list above. Why don't these people just come out and admit that this TARP garbage is immoral an unconstitutional in the first place?]
S-651 – A bill to amend the Internal Revenue Code of 1986 to impose an excise tax on excessive bonuses paid by, and received from, companies receiving Federal emergency economic assistance, to limit the amount of nonqualified deferred compensation that employees of such companies may defer from taxation, and for other purposes. [Number 7, by Sen. Max Baucus [D-MT]…]
HR1649 – To authorize the Secretary of Education to make grants to reduce the size of core curriculum classes in public elementary and secondary schools, and for other purposes.
HR1645 (also S-638) – To provide grants to promote financial and economic literacy. [While I think it's critical that people become more financially and economically literate, government should certainly not be the teacher, or else we'll end up with more Keynesian nitwits that have destroyed our economy to date. Rather, people can take Chris Martenson's Crash Course for free, and read books like Hazlitt's Economics in One Lesson and Tom Woods' Meltdown.]
HR1643 (also S-648) – To amend title XVIII of the Social Security Act to establish a prospective payment system instead of the reasonable cost-based reimbursement method for Medicare-covered services provided by Federally qualified health centers and to expand the scope of such covered services to account for expansions in the scope of services provided by Federally qualified health centers since the inclusion of such services for coverage under the Medicare Program.
HR1642 – To provide loans and grants for fire sprinkler retrofitting in nursing facilities.
HR1641 – To amend the National Trails System Act to provide for a study of the Cascadia Marine Trail.
HR1640 – To amend the Truth in Lending Act to protect consumers from usury, and for other purposes. [Caveat emptor. The process of buying a home would be much quicker and hassle-free if not for the myriad of regulations and bureaucratic red-tape imposed by the federal, state, and local governments.]
Your Senators and Representatives have continued to be busy little bees, always grinding the sausage. Forty-four new bills introduced yesterday:
HR230 – Recognizing the historical significance of the Mexican holiday of Cinco de Mayo. [You've got to be kidding me. If this weren't displayed on official government sites, I would swear this was a joke.]
HR1388 – Generations Invigorating Volunteerism and Education Act: To reauthorize and reform the national service laws.
HR1415 – To provide for a demonstration project regarding Medicaid reimbursements for stabilization of emergency medical conditions by non-publicly owned or operated institutions for mental diseases.
HR1413 – To amend the Internal Revenue Code of 1986 to allow certain public employees a deduction for distributions from governmental plans for health and long-term care insurance, and for other purposes.
HR1412 – To increase public confidence in the justice system and address any unwarranted racial and ethnic disparities in the criminal process. [Looking at the full text of this bill, it's clear that the authors have the idea that justice is being served out "unfairly" with respect to race and ethnicity, and are under the mistaken impression that "unconscious bias" can be legislated away.]
The past couple days have been quite interesting due to a live improvised and impassioned rant by CNBC’s Rick Santelli the other day. His rant represents the near-rage many Americans feel about the Obama administration’s latest plan for wealth redistribution and creating further moral hazard.
The story begins with Rick Santelli’s rant:
Amen Rick. Amen. He may be a loud talker, but he speaks the truth, which these days needs to be shouted for anyone to hear it. After the stir he caused with his rant online CNBC posted a poll asking if you would show up for a Chicago Tea Party in July as he mentions in the rant. Apparently, before the poll was removed 94% said they’d be there with about 250,000 votes.
This morning I heard Rick’s rant played and discussed on Glenn Beck’s radio show, Opie and Anthony’s radio show of all places, and several other main stream media outlets.
Judge Andrew Napolitano has a brand new (online only for now) show called Freedom Watch on FOX News. The first show was this afternoon. It was a liberty power hour. It brought together the likes of Ron Paul, Peter Schiff, Cody Willard, and The Judge for an hour of discussion. Also on the show were Stephen Moore from the WSJ and Alan Colmes from FOX.
I was unable to capture the video of the show, but I did record the entire show’s audio. I enjoyed the pre-show banter where Cody Willard asks Peter Schiff about running for office in 2010 so I kept that part in the audio available below. Also they discuss how the “blogs have been going crazy” about the show.
One of the best quotes comes from Willard when he calls Treasury Secretary Geithner “a 35 year old punk”. Cody Willard is the host of the FOX Business show called “Happy Hour” and is a friend to free markets and individual liberty. Read his blog “The Cody Word”.
It sounds like The Judge will have Ron Paul back and some of his other guests in the coming weeks. It’s a great listen and if/when FOX posts the video I’ll post it below.
For now listen to the 60 minutes of audio below. Note that the show doesn’t start until about 2 1/2 minutes in. If you want to miss the banter and opening music then just jump to that point.
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The LBMA Silver Mid Rate goes negative AGAIN!!!! Read on to see why I used 4 exclamation points.
by Jake, the Champion of the Constitution Originally published Friday, January 30, 2009 at http://www.nolanchart.com/article5916.html
[In case you do not yet understand futures markets, "backwardation" means that silver to be delivered today is now being priced higher than metal to be delivered later in the London Bullion Market Association's futures market in London, England. For more details on backwardation, please refer to my five-part December series which starts here "The End for the Dollar and all Fiat Currencies (1/5)". Contango is the opposite of backwardation and exists when futures price is higher than the spot price as I explained for those new to futures terminology here "The Money Matrix - What the Heck Are Derivatives? (PART 10/15)". [As you read, please also note that I am NOT a commodities trader, I am just an engineer by trade, so feel free to help me out with my analysis or mistakes.] ( Photo) (2)
As we learned in “The Significance of Gold Backwardation Explained (4/5)“, backwardation is a sign of a very tight market, and a market that will be tight for sometime into the future either 1) current supply is very tight, 2) future supply is projected to be very tight, or 3) there is a severe distrust in counterparties that the short positions can deliver the goods on time per the contract, or vice versa that the long positions will not have the cash.]
John Stossel’s commentary on Townhall.com details why the recent Madoff scam brouhaha wonderfully illustrates why government regulation rarely, if ever, works, and in fact often makes things worse.
The $50-billion investment scam allegedly pulled off by Wall Street insider Bernard Madoff has ignited predictable calls for more regulation.
The “massive fraud … was made possible in part because the regulators who were assigned to oversee Wall Street dropped the ball,” said President-elect Obama.
“This scandal underscores the need for a 21st century regulatory approach,” writes Arthur Levitt Jr., former chairman of the Securities and Exchange Commission (SEC), in The Wall Street Journal.
Notice the disconnect. Regulation failed, so we need more regulation. I see it differently. Regulation failed, so let’s try free markets. That would be a change.
Regulation did indeed fail. “An executive in the securities industry, Harry Markopolos, contacted the SEC’s Boston office in May 1999, urging regulators to investigate Mr. Madoff. Mr. Markopolos continued to pursue his accusations over the past nine years,” The Wall Street Journal reported.
The price of gold rises for the 8th year in a row, although it is more accurate to say the purchasing power of the fiat dollar is eroding.
by Jake, the Champion of the Constitution Originally published on Sunday, January 4, 2009 at http://www.nolanchart.com/article5747.html
Although certainly it was not my intent to share investment ideas when this column was first started, some readers who took my advice this year are cackling with glee.
You see, James Turk of goldmoney.com in his latest newsletter noted that despite the losses in the commodity and equity markets, the price of gold managed to rise for the eighth year in a row in nominal dollar turns. The gains in 2008 were +5.8% as compared to +16.3% average since 2001. Silver had its first down year since 2002 with a loss of 24%, although its average since 2001 is a very healthy +13.7%.
The interesting take-away from Turk’s report is that over the long run, other fiat national currencies are losing roughly 13% annually to the yellow metal, while dollar and British pound are noticeably worse at 16-17%. Why? Perhaps I am wrong, but history doesn’t repeat, but it does rhyme. The shotgun marriage of the FED and Bank of England led the world into the Great Depression following the Great Inflation of the 1920s as I wrote about in this 2-part series, possibly in our contemporary time something similar is occurring.
Robert Higgs rules. In his recent article published at LewRockwell.com he is quite straightforward at blasting the idiocy of Keynesian economics and its proponents such as Martin Feldstein. He begins:
Writing in the Wall Street Journal on December 24, 2008, Martin Feldstein gives us an article entitled “Defense Spending Would Be Great Stimulus.” The title tells you everything you need to know: military Keynesianism is the medicine being prescribed by a leading figure of the politico-economic Establishment – a Harvard professor, former chairman of the Council of Economic Advisers, former president of the American Economic Association, president emeritus of the National Bureau of Economic Research, and member of the President’s Foreign Intelligence Advisory Board. That a man so drenched in professional honors and attainments would be peddling such long-discredited claptrap speaks volumes about the state of mainstream economics. When you think it can’t sink any lower, it does.
Feldstein opines that “countering a deep economic recession requires an increase in government spending to offset the sharp decline in consumer outlays and business investment that is now under way. Without that rise in government spending, the economic downturn would be deeper and longer.” This statement encapsulates the essence of vulgar Keynesianism. It would seem that Feldstein, like nearly every other lion of the mainstream economics profession, failed to notice that by the very empirical-test standard the profession considers sacrosanct, this theory was decisively refuted by the events of 1945–47 – or perhaps the mainstreamers believe that after their model had, as they see it, proved its mettle so beautifully on the upside from 1940 to 1945, its abysmal failure to predict from 1945 to 1947 need not be taken seriously.
And later:
Keynesian economics rests on the presumption that government spending, whether for munitions or other goods, creates an addition to the economy’s aggregate demand and thereby brings into employment labor and other resources that otherwise would remain idle. The economy gets not only the additional production occasioned by the use of these resources, but still more output via a “multiplier effect.” Hence comes the Keynesian claim that even government spending to hire people to dig holes in the ground and fill them up again has beneficial effects: even though the shovelers create nothing of value, the multiplier effect is set in motion as they spend their money income for consumption goods newly produced by others.
At the Ludwig von Mises Institute, William L. Anderson has written a fantastic article describing the causes of our bubble economy mostly by doing a number on Paul Krugman, recent Nobel Prize winner who doesn’t seem to have a clue about reality. It’s a great read:
As a long-time critic of the part-time economist and full-time political partisan Paul Krugman, I would be remiss if I did not give him at least some credit for being able to point out the obvious: Bernard Madoff’s Ponzi scheme really is a prototype for the modern US economy. Yes, Krugman is right, but, alas, I am also required to add that a broken clock is still more consistent at telling time than Krugman is at explaining economic phenomena.
Indeed, the US economy has gone through two destructive financial bubbles in the past decade, although the government’s response to the last bubble has been to spread the damage throughout the economy to where the damage can no longer be relatively contained. The Madoff revelations are simply another blow to the reeling financial industry that not long ago was “creating” multimillionaires who had not yet made it to their fifth reunions at Harvard or Duke.
M1 hits 37% growth!! “Most of the significant American banks, the larger banks, are bankrupt, totally bankrupt.” – Jim Rogers, 12/11/2008
by Jake, the Champion of the Constitution Originally published on December 14, 2008 at http://www.nolanchart.com/article5645.html
ATHENS, GREECE – Greek riots over governmental fiscal policy on December 11-12 exemplify growing worldwide economic discontent. Despite whatever cherry-topped fairy-tales that pass for news these days are delivered to the American public, the US banking situation continues to worsen. It is my guess that some of Greek rioters yesterday per this AP article may not have it completely figured out, but they are really rioting against the central banking and fiat money. (Rodgers quote) (photo)
Liberty Maven
[In case you do not yet understand futures markets, "backwardation" means that silver to be delivered today is now being priced higher than metal to be delivered later in the London Bullion Market Association's futures market in London, England. For more details on backwardation, please refer to my five-part December series which starts here "
ATHENS, GREECE – Greek riots over governmental fiscal policy on December 11-12 exemplify growing worldwide economic discontent. 
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