We will have a mirror site at http://nunezreport.wordpress.com in case we are censored, Please save the link

Thursday, May 17, 2012

An Interview With Stephen Meyer and Chuck MIssler

Rare 'Ring Of Fire' Eclipse In Asia And US


Early risers in some parts of China and Japan will see a rare solar eclipse at the weekend.

A partial solar eclipse - which will see the moon completely block out the sun but for a ring of fire around the moon's edge - is set to slink across a narrow swathe of the Earth on May 20 and 21.

The event, which scientists call an annular eclipse, will also be visible at sunset in western parts of the United States.

Depending on where people are in the eclipse's path, some may be able to witness an annular eclipse, while others will see the sun as a crescent, partially obscured by the moon, for a period of around four to five minutes.






According to Nasa, the eclipse will begin at sunrise in southern China, moving eastward to the southern coast of Japan.

It will continue onto the Pacific Ocean, passing south of Alaska's Aleutian Islands before reaching the coastlines of southern Oregon and northern California where it will be visible in Nevada, Utah, New Mexico, Arizona and Texas.

It will be the first time in 18 years that such an eclipse is visible from the US, according to Fred Espenak, a longtime solar eclipse expert with Nasa.

"What is unusual about this particular annular eclipse is that it goes over the western US," Mr Espenak said.

"People always think that eclipses are extremely rare but there are at least two solar eclipses every year. Each of these annular eclipses covers a very small fraction of the Earth's surface."

The next time the Earth will witness a total eclipse of the sun, a more dramatic event than a partial or annular eclipse, will be August 21, 2017.


Sky News

Germany Worries About Its Gold Reserves



German politicians and accounting bodies want more guarantees concerning the security of Germany’s gold reserves, with Germany’s federal audit office due to report to the finance committee of the German Parliament on the matter.

Germany has the world’s second-largest gold reserves, but keeps most of them overseas, mainly at the U.S. Federal Reserve, the Bank of England and the Banque de France. The federal audit office, or Bundesrechnungshof, is disappointed that while the gold stored in Germany is regularly checked by the Bundesbank, the gold overseas is not. The foreign banks merely give the Bundesbank an annual statement detailing the amount of gold.

The security of the gold is becoming a popular concern, with the Bild tabloid claiming the Bundesbank has not checked its gold reserves for five years.

Spiegel Online writes, “In times of uncertainty about the future of Europe’s common currency, gold is a hot topic, and some Germans take a dim view of the fact that much of the country’s gold—which theoretically belongs to the people—is held abroad.”

A campaign called “Gold Action,” which calls for Germany’s gold to be brought home, is supported by several economists and journalists. A member of the ruling Christian Democratic Union (cdu), Philipp Missfelder, visited the Federal Reserve in New York to see the gold, but “staff were either unable or unwilling to show him exactly which bars belonged to Germany,” as Spiegel Online put it. A member of parliament from the cdu’s sister party, the Christian Social Union, regularly tables parliamentary questions on the subject.

But the Bundesbank insists no additional checks on the gold are needed. “The scope of the checks that the Bundesrechnungshof wants does not correspond to the usual practices among central banks,” read a bank statement, according to the Frankfurter Allgemeine Zeitung. “There are no doubts about the integrity and the reputation of these foreign depositories.”

It also pointed to the cost of bringing the gold home, and the effect it would have on already skittish financial markets.

It’s no coincidence that this is an issue right now. The euro and banking crises are threatening the stability of paper money everywhere. In earlier times of monetary collapse, central banks have simply seized other people’s gold.
The Trumpet


Gerald Celente - Capital Account

Spain faces soaring borrowing costs in €2.5bn bond auction


There was an auction of Spanish bonds this morning. Demand was up and the state sold €2.49bn of debt - which you could see as an achievment in the current climate - but it came at a huge cost.

Bonds due in January 2015 carried an average yield of 4.375pc, up massively from the last comparable auction in April, which saw an average of 2.89pc.

Bonds due in July 2015 were even higher, at 4.876pc, compared with 4.037pc at an auction in May. Bonds due in April 2016 reached 5.106pc.

Last night Spanish PM Mariano Rajoy warned that there was “a serious risk we will not be able to borrow - or borrow at astronomical prices” and pleaded for an urgent “defence of the euro project”.

The Telegraph

Others are Preparing. Should You?

Joseph Herrin (05-12-2012)

Proverbs 22:3
A prudent man foresees evil and hides himself, but the simple pass on and are punished.

I am not of the mind that all Christians should operate as clones, each doing the same thing. I have continually advocated that the saints of Yahshua should be led of the Spirit in all they do. I have urged the body of Christ to wait before the Father, inquiring of Him regarding His will for them at this season. One concern that I have is that many Christians have become complacent. Being in the world, and inundated with the propaganda that is flooding the world at this hour from all media sources, it is very easy to be swept away with the flood of deception, or to have one’s sight dimmed by the darkness all around. This is the Chinese year of the Water Dragon. In the book of Revelation we are given an image of a dragon who pours forth a flood of water out of his mouth to sweep away the woman (the church).



Revelation 12:15-17
And the serpent poured water like a river out of his mouth after the woman, so that he might cause her to be swept away with the flood. But the earth helped the woman, and the earth opened its mouth and drank up the river which the dragon poured out of his mouth. So the dragon was enraged with the woman, and went off to make war with the rest of her children, who keep the commandments of God and hold to the testimony of Yahshua.

Satan truly spews forth a flood of words out of his mouth to sweep people away into destruction. His great cunning is such that most are not even aware of what is occurring. The mainstream media is completely under the sway of the dragon. What is reported is a manifestation of the wickedness and deception of an adversary who has studied mankind for thousands of years. Even when it appears that the media is reporting the misdeeds of one of Satan’s chief servants, one should not be deceived. It is often a case of misdirection. Like a magician who draws people’s attention to what he is doing with his right hand, it is only to distract them from observing what is being done by the left hand. When the mainstream media seems to be attacking a proponent of the New World Order as it did during the Bill Clinton/Monica Lewinsky scandal, or the current focus on Rupert Murdoch, do not be deceived. Your attention is being intentionally steered in one direction to mask that which they desire to remain hidden and secret.

Consider the following: Some of the most threatening, indeed startling, changes of law have been passed by the Congress and President of the United States in recent years without the media giving any attention at all to what is being done. There is absolute silence. For example, I recently posted the words of Congresswoman Kay Granger (She is from Texas, not Colorado. My apologies). She was seeking to alert the populace to alarming things being done in government. Following is an excerpt from her post.

Dear Friend,


With all that is going in Washington these days some things don’t make the news the way they should. Fourteen days ago President Obama issued an Executive Order that you should know about. This order gives an unprecedented level of authority to the President and the federal government to take over all the fundamental parts of our economy - in the name of national security - in times of national emergency.


This means all of our water resources, construction services and materials (steel, concrete, etc.), our civil transportation system, food and health resources, our energy supplies including oil and natural gas – even farm equipment – can be taken over by the President and his cabinet secretaries. The Government can also draft U.S. citizens into the military and force U.S. citizens to fulfill "labor requirements" for the purposes of "national defense." There is not even any Congressional oversight, only briefings are required.
[Source: http://kaygranger.house.gov/weekly-enewsletter-executive-order-you-should-know-about]

This elected official from the Fort Worth area of Texas begins by saying that “some things don’t make the news the way they should.” This is not due to accident, or oversight. It is by design. Wh the nation’s attention is being diverted by the shooting of Trayvon Martin in Florida, aided by the President’s own comments on the subject as he says “If I had a son he would look like Trayvon Martin,” the President effectively draws your attention in one direction to divert attention from his left hand.





Observe the Left Hand

Aiding the President in this act of misdirection is a populace that is easily manipulated. Like a puppet on a string, those acting behind the scenes can guide the majority of the population in whatever direction they desire. Race issues are especially effective in achieving these covert acts of misdirection. Emotions are inflamed, making it exceptionally easy to divert attention from the real threats that are bearing down upon a nation.

It could be argued that a decadent, sensual, immoral nation will reap just what they deserve. Like the man I reported on in the previous post who ran head on into a concrete pillar that was painted yellow that had stood in the same place for years, the nation will incur great loss due to their lack of perception. As Solomon stated, “A prudent man foresees evil and hides himself, but the simple pass on and are punished.”

My aim is to alert the saints to that evil which is coming. I am not a fear-monger. I do not desire to instill fear, or to incite people to acts of panic. I would exhort you to wake-up, to realize what is occurring, and to press into the Father to receive from Him His counsel and direction for your life at this season before the storm hits.

The title of this blog is “Others are preparing. Should You?” The others I specifically had in mind are ones that the media should be telling you about, but are not. Is it not newsworthy to ask why Barack Obama would deem it necessary to sign an executive order at this time giving authority to the President to take over all fundamental parts of the economy in a time of national emergency? Is there not at least one reporter who would dare ask what national emergency is foreseen that would justify such a sweeping alteration of national laws? Are there no honest reporters concerned over the language of this Executive Order that would permit the government to impress men and women into service, forcing them to fulfill “labor requirements” in the name of “national security”? Is it not newsworthy to publish the fact that the President has just awarded himself the authority to enslave the entire populace under the guise of national need?

The government is making all manner of preparation for a coming hour of national turmoil, civil unrest, and anarchy. They are aware of what is coming and have been taking definite steps to make sure they are positioned to not only remain in control, but to establish a far greater hegemony over the population. Liberty is falling at this very hour with every stroke of the pen. It only awaits the proper catalyst to execute plans that are being cunningly laid.

In previous posts I have commented on some of the more egregious acts of Congress and the President that have been passed in anticipation of an hour of crisis greater than this nation has ever known. What is coming will be more severe than the Civil War and the Great Depression together. Planning for this day is the impetus behind The Military Commissions Act of 2006 “To authorize trial by military commission for violations of the law of war, and for other purposes.” The Act uses the phrase 'unlawful enemy combatant' which it defines as “a person who has engaged in hostilities or who has purposefully and materially supported hostilities against the United States...” Although the President assured Americans it would never be used against citizens, Congress has since ruled that the measures apply to all who are defined as ‘unlawful enemy combatants,’ and this includes citizens as well as aliens.

Foreseeing what is coming the government in 2007 passed the John Warner National Defense Authorization Act which included a section titled “Use of Armed Forces in Major Public Emergencies.” This act provides for the use of United States Armed Forces to be used on American soil against American citizens. According to Wikipedia, this act declares the following:

The President may employ the armed forces to restore public order in any State of the United States the President determines hinders the execution of laws or deprives people of a right, privilege, immunity, or protection named in the Constitution and secured by law or opposes or obstructs the execution of the laws of the United States or impedes the course of justice under those laws.
[Source: http://en.wikipedia.org/wiki/Posse_Comitatus_Act]

For the first time in the nation’s history, the Federal Government has during a time of peace positioned American troops on U.S. soil to be used against Americans, training them to handle civil unrest. The President and the Department of Homeland Security will have their own military force in place in readiness for what is soon to occur. I will quote from the publication Army Times.

Brigade homeland tours start Oct. 1
By Gina Cavallaro - Staff writer
Posted : Monday Sep 8, 2008 6:15:06 EDT

The 3rd Infantry Division’s 1st Brigade Combat Team has spent 35 of the last 60 months in Iraq patrolling in full battle rattle, helping restore essential services and escorting supply convoys.

Now they’re training for the same mission — with a twist — at home.

Beginning Oct. 1 for 12 months, the 1st BCT will be under the day-to-day control of U.S. Army North, the Army service component of Northern Command, as an on-call federal response force for natural or manmade emergencies and disasters, including terrorist attacks...

This new mission marks the first time an active unit has been given a dedicated assignment to NorthCom, a joint command established in 2002 to provide command and control for federal homeland defense efforts and coordinate defense support of civil authorities...

They may be called upon to help with civil unrest and crowd control or to deal with potentially horrific scenarios such as massive poisoning and chaos in response to a chemical, biological, radiological, nuclear or high-yield explosive, or CBRNE, attack.

Training for homeland scenarios has already begun at Fort Stewart...
[Note: This article has been removed from Army Times website due to public alarm.]

Halliburton subsidiary Kellogg Brown and Root has been awarded contracts totaling hundreds of millions of dollars to build detention and processing facilities across the United States. KBR also provides police and military services to the Department of Homeland Security. This information was reported in the New York Times. The explanations given for these actions all sound innocuous. It is only when one begins to see a trend developing that things seem other than as they are reported.
[Source: http://www.nytimes.com/2006/02/04/national/04halliburton.html]

One of the first acts of the 111th Congress which came into office with Obama was to pass legislation to authorize and fund regional detention facilities across the nation. The legislation can be read at the government’s website.

http://thomas.loc.gov/cgi-bin/query/z?c111:H.R.645:

With the more recent National Defense Authorization Act of 2012 and the National Defense Resources Preparedness Act signed by the President, it is evident that there are people in high places who are making preparations for a time of national emergency. Following is an excerpt from the Executive Order recently signed by Barack Obama while everyone’s attention was diverted elsewhere.

The authority of the President conferred by section 101 of the Act, 50 U.S.C. App. 2071, to require acceptance and priority performance of contracts or orders (other than contracts of employment) to promote the national defense over performance of any other contracts or orders, and to allocate materials, services, and facilities as deemed necessary or appropriate to promote the national defense, is delegated to the following agency heads:

(1) the Secretary of Agriculture with respect to food resources, food resource facilities, livestock resources, veterinary resources, plant health resources, and the domestic distribution of farm equipment and commercial fertilizer;


(2) the Secretary of Energy with respect to all forms of energy;


(3) the Secretary of Health and Human Services with respect to health resources;


(4) the Secretary of Transportation with respect to all forms of civil transportation;


(5) the Secretary of Defense with respect to water resources; and


(6) the Secretary of Commerce with respect to all other materials, services, and facilities, including construction materials.

(b) The Secretary of each agency delegated authority under subsection (a) of this section (resource departments) shall plan for and issue regulations to prioritize and allocate resources and establish standards and procedures by which the authority shall be used to promote the national defense, under both emergency and non-emergency conditions...

Sec. 801. Definitions. In addition to the definitions in section 702 of the Act, 50 U.S.C. App. 2152, the following definitions apply throughout this order:

(a) "Civil transportation" includes movement of persons and property by all modes of transportation in interstate, intrastate, or foreign commerce within the United States, its territories and possessions, and the District of Columbia, and related public storage and warehousing, ports, services, equipment and facilities, such as transportation carrier shop and repair facilities. "Civil transportation" also shall include direction, control, and coordination of civil transportation capacity regardless of ownership. "Civil transportation" shall not include transportation owned or controlled by the Department of Defense, use of petroleum and gas pipelines, and coal slurry pipelines used only to supply energy production facilities directly.

(b) "Energy" means all forms of energy including petroleum, gas (both natural and manufactured), electricity, solid fuels (including all forms of coal, coke, coal chemicals, coal liquification, and coal gasification), solar, wind, other types of renewable energy, atomic energy, and the production, conservation, use, control, and distribution (including pipelines) of all of these forms of energy.

(c) "Farm equipment" means equipment, machinery, and repair parts manufactured for use on farms in connection with the production or preparation for market use of food resources.

(d) "Fertilizer" means any product or combination of products that contain one or more of the elements nitrogen, phosphorus, and potassium for use as a plant nutrient.

(e) "Food resources" means all commodities and products, (simple, mixed, or compound), or complements to such commodities or products, that are capable of being ingested by either human beings or animals, irrespective of other uses to which such commodities or products may be put, at all stages of processing from the raw commodity to the products thereof in vendible form for human or animal consumption. "Food resources" also means potable water packaged in commercially marketable containers, all starches, sugars, vegetable and animal or marine fats and oils, seed, cotton, hemp, and flax fiber, but does not mean any such material after it loses its identity as an agricultural commodity or agricultural product.

(f) "Food resource facilities" means plants, machinery, vehicles (including on farm), and other facilities required for the production, processing, distribution, and storage (including cold storage) of food resources, and for the domestic distribution of farm equipment and fertilizer (excluding transportation thereof)...

n) "Water resources" means all usable water, from all sources, within the jurisdiction of the United States, that can be managed, controlled, and allocated to meet emergency requirements...
[Source: http://www.whitehouse.gov/the-press-office/2012/03/16/executive-order-national-defense-resources-preparedness]

This is what has alarmed Congresswoman Kay Granger. Now, is it not reasonable for the Christian who is awake and alert in this hour to get alone with the Father and ask Him what He would have them to do that they might also be prepared for an hour of national emergency which is surely coming? I reported yesterday that Yahweh had set a sign before me (a literal sign) that “military time” is coming and is not far off. I believe there is a period of time yet in which the saint might be led of the Father to make preparation for that hour. I would ask you, “Are you seriously seeking the mind of the Father about these things, or are you lulled to sleep by the drone of the media while your attention is misdirected by a cunning sleight of hand?”

I Thessalonians 5:4-8
But you, brethren, are not in darkness, that the day would overtake you like a thief; for you are all sons of light and sons of day. We are not of night nor of darkness; so then let us not sleep as others do, but let us be alert and sober. For those who sleep do their sleeping at night, and those who get drunk get drunk at night. But since we are of the day, let us be sober...

To those who would argue that a Christian should be so spiritual that they are unconcerned about days of approaching distress, I encourage you to consider how many times Yahshua exhorted His disciples to be aware of the day approaching and to act accordingly.

Matthew 24:15-21
“Therefore when you see the 'abomination of desolation,' spoken of by Daniel the prophet, standing in the holy place" (whoever reads, let him understand), then let those who are in Judea flee to the mountains. Let him who is on the housetop not go down to take anything out of his house. And let him who is in the field not go back to get his clothes. But woe to those who are pregnant and to those who are nursing babies in those days! And pray that your flight may not be in winter or on the Sabbath. For then there will be great tribulation, such as has not been since the beginning of the world until this time, no, nor ever shall be.”

Matthew 10:21-23
“Brother will betray brother to death, and a father his child; and children will rise up against parents and cause them to be put to death. You will be hated by all because of My name, but it is the one who has endured to the end who will be saved. But whenever they persecute you in one city, flee to the next; for truly I say to you, you will not finish going through the cities of Israel until the Son of Man comes.”

It has been a common experience for Yahweh to lead His people through times of great distress and persecution. Many have lost all worldly goods, their homes, their freedom, and even their lives in the evil days of this earth.

Hebrews 10:32-36
But remember the former days, when, after being enlightened, you endured a great conflict of sufferings, partly by being made a public spectacle through reproaches and tribulations, and partly by becoming sharers with those who were so treated. For you showed sympathy to the prisoners and accepted joyfully the seizure of your property, knowing that you have for yourselves a better possession and a lasting one. Therefore, do not throw away your confidence, which has a great reward. For you have need of endurance...

The Spirit is indicating that days of distress, loss of personal property, and even loss of freedom, are near at hand. If you could mitigate your loss and the suffering of your family by paying heed to the Father, seeking His counsel and doing all He requires you to do, would you not do it?

I urge you to put away the doubts. The media may be repeating the message that the economy is stable and that employment and prosperity are returning. They may be drumming the hypnotic beat that leads to complacency, but you need not be swept away to destruction by their words. Don’t focus on the hand they are waving in front of your nose. Look to the sinister hand that is accomplishing things out of sight. Believe. Understand. Know that the prosperity, ease and comfort of the nations is soon to be shattered, and it will happen suddenly.



I have sought the Father and He is giving me guidance in this hour, and the wherewithal to accomplish it. Are you seeking Him to know His will for you?

Turks accuse Israel of violating N. Cyprus airspace




Turkey on Thursday accused Israel of violating the airspace above an area of oil and gas exploration in Turkish-controlled northern Cyprus, AFP quoted the Turkish army command as saying.

Israeli aircraft encroached on the airspace five times on Monday prompting Turkish fighter jets to eventually chase them away, according to the Turkish army statement.

The eastern Mediterranean has become a coveted area since Israel and Cyprus made significant gas finds in the area.

Turkey has also objected to Cyprus exploring for gas in the areas of the Mediterranean bordering its territory. Cyprus has been divided since 1974, when the Turkish military invaded the island after a short-lived Greek Cypriot coup engineered by the military junta then in power in Athens. Turkey still keeps about 30,000 troops in the north and is the only nation which recognizes the self-declared Turkish Republic of Northern Cyprus.

Tensions rose last September when Cyprus began drilling in a southeast offshore area adjoining a gas field in Israeli waters reputed to be the world's largest find in the past decade. Turkey contests a Cypriot-Israeli accord signed in 2010 to create exclusive economic zones in the waters between them.

It also argues that Cyprus should not be exploiting natural resources until a settlement is reached between the Cypriot government and a breakaway Turkish Cypriot state for the reunification of the island, and that any revenues should benefit both communities.

Last month, Turkey's cabinet gave approval for Turkey's state-run oil firm to carry out oil and gas exploration in six offshore areas around the island of Cyprus, drawing condemnation from the Cypriot government which lays claim to the territory.

Jerusalem Post

US talks peace while arming rebels via Gulf allies

Iran drills first large-scale paratroop drops for offensive action




Special operations units of the Iranian army and Revolutionary Guards (IRGC) Tuesday, May 14, began a two-day practice of offensive tactics, for the first time dropping large-scale forces from the air deep behind enemy lines. The many war games Iran has conducted until now focused on defenses of strategic and nuclear locations and repelling invaders. This drill displayed its aggressive capabilities. Codenamed Ja’far Tayyar, it was staged in remote Khorasan near the Afghan border, so as not to expose the commando tactics it employed.

In announcing the exercise, Gholam-Ali Gholamian, Dep. Commander for Operations for the IRGC Ground Forces, cagily called it another routine exercise for “maintaining the preparedness and promoting the combat capability of units stationed in the region.”

DEBKAfile’s military sources disclose that there was nothing routine about it. The units taking part were not stationed in the region but flown in especially.
Western intelligence sources observing the exercise report that its offensive nature was evident: Air transports coming in from the rest of the country dropped large numbers of paratroopers and special forces; Air Force fighter-bombers practiced intense bombardments of small targeted locations; and helicopters drilled rapid transfers of forces between points and air cover for the units reaching the ground.

Monday, the Persian Gulf rulers invited to Riyadh by Saudi King Abdullah for a summit on the Iranian threat dwelt long and hard on the exercise and concluded the threat had been exacerbated and that Tehran had more in store for them than closing the Strait of Hormuz to oil traffic in the event of war. They saw special forces being prepared by Iran to strike deep inside their countries up to and including their oil-producing regions.

The exercise also served the ongoing trade of war signals between Washington and Tehran. Staging a special forces exercise not far from the US military presence in Afghanistan was meant as a rejoinder to US-led special forces maneuver taking place in Jordan across the border with Syria with the participation of 17 nations.
Iranian and Syrian media made much of the fact that the US-led war game was named Eager Lion 12 as a deliberate insult to Bashar Assad, whose name is the Arabic for Lion.

DEBKAfile

Systemic Risk Is Everywhere

Remember our post of this:
That´s the Chase exposure, for more on that post:
Demo10
The $2 billion loss of JP Morgan in derivatives trading is signaling, once again, the enormous risks big banks take with taxpayer backing. All U.S. banks are covered by the FDIC, and if a loss is big enough, it could threaten the financial system just as it did in 2008. JP Morgan has $70 trillion in total derivative exposure. The entire world has a little more than $700 trillion in derivative exposure, and one bank has 10% of all the derivative exposure on the planet! If JP Morgan gets into trouble, it alone could cause systemic failure. Today, the FBI announced an investigation into the surprise $2 billion (or more) trading loss that happened last week at the bank. Reuters reported,“The probe was seen in some quarters as necessary, given the ongoing debate in Washington about bank regulation and reform, and one expert said it raised the level of concern around what happened. 

 ‘The FBI looks for evidence of crimes and goes after people who it alleges are criminals. They want to send people to jail. The SEC pursues all sorts of wrongdoing, imposes fines and is half as scary as the FBI,’ said Erik Gordon, a professor in the law and business schools at the University of Michigan.” 

The Obama Administration has to be very worried about JP Morgan which has the biggest derivative exposure ($70.1 trillion) of American banks. The next 4 big U.S. banks after JP Morgan, also, have huge derivative exposure. Citibank has $52.1 trillion in total derivatives, Bank of America has $50.1 trillion, Goldman Sachs has 44.2 trillion and HSBC USA has $4.3 trillion in total derivatives. Combined, the five biggest commercial banks have $220.9 trillion in total derivative contracts. Weigh that against the combined assets of those same top five banks of just $4.8 trillion, and you get an eye popping 46 to 1 leverage! What could go wrong? 

Please remember, in 2009, the Financial Accounting Standards Board (FASB) changed how banks value assets such as real estate and mortgage-backed securities to whatever the institution thinks they’ll fetch in the future. These “assets” are not valued at what they would sell for today. I call this “government sanctioned accounting fraud.”

The other big banks are probably making some of the same bets in risky derivative as JP Morgan. The FBI opening up an investigation now is like closing the barn doors after all the livestock has run off. There have been zero criminal prosecutions of financial elites in the wake of the 2008 meltdown. (1,000 were successfully prosecuted after the S&L crisis in the 1990’s.) That is no accident. I think it’s because of Wall Street’s political connections, but also because the government has been worried about pushing too far for fear of crashing an already fragile financial system. Now, the FBI is going to start prosecuting Wall Street. Really? Why doesn’t the FBI investigate the Halloween bankruptcy of MF Global and the $1.6 billion in missing segregated client funds?

Details are sketchy, but it has been reported that JP Morgan lost at least $2 billion in the European debt market with derivatives. The austerity in the EU is simply the banks wanting the people to cut back on everything so they get paid back. Elections in France and Greece recently have turned that pipe dream into a nightmare for the bankers. People are voting for less austerity for themselves and for more pain for the banks. Over the weekend in Spain, more than 100,000 marched in protest over harsh austerity. This quote from the New York Times sums up the mood of the crowd: “I’m here to defend the rights that we’re losing and for the young people who have it so tough,’ 57-year-old middle school teacher Roberto Alonso said. ‘They’re better educated than ever. But they don’t have work. They don’t have anything. They’re behind and they’ll stay that way.”

The European banking sector has been plagued with downgrades in nearly every major country in the European Union. The situation looks like it’s getting worse–not better. Just yesterday, 26 Italian banks got chopped. That is an ominous sign as Italy is the granddaddy of the so-called PIIGS (Portugal, Ireland, Italy, Greece and Spain). It is the 4th largest economy in the EU. Yesterday, Greek depositors withdrew nearly $1 billion (700 million euros) from local banks. Will there be bank runs coming in other countries?

On top of it all, there appears to be little growth as, at least, 8 countries are in recession in Europe. Trouble for banks in Europe and the U.S. will eventually lead to another massive bailout to save the Western financial system. Much of the bailouts will, of course, come from the Federal Reserve. Just three weeks ago, Ben Bernanke strongly hinted at more money printing which the Fed Chief calls “tools.” He said, “Those tools remained very much on the table and we would not hesitate to use them should the economy require that additional support.” It is not the economy Bernanke is worried about, it is the extremely leveraged banking system.

The monster downside to all the bailouts to prop up the system is the devaluing of the U.S. dollar and the destruction of the credit worthiness of America. There is another downside to the policy of privatizing the profits and socializing the losses, and that is the loss of confidence of the U.S. dollar as the world’s reserve currency. It will come down to the Fed choosing between the banks or the buck. It looks like the dollar will be sacrificed on an altar of insolvency. It is clear, systemic risk is everywhere.

USAWatchdog.com


Cost of Greek exit from euro put at $1tn




The British government is making urgent preparations to cope with the fallout of a possible Greek exit from the single currency, after the governor of the Bank of England, Sir Mervyn King, warned that Europe was "tearing itself apart".

Reports from Athens that massive sums of money were being spirited out of the country intensified concern in London about the impact of a splintering of the eurozone on a UK economy that is stuck in double-dip recession. One estimate put the cost to the eurozone of Greece making a disorderly exit from the currency at $1tn, 5% of output.

Officials in the United States are also nervously watching the growing crisis: Barack Obama on Wednesday described it as a "headwind" that could threaten the fragile American recovery.

In a speech in Manchester before flying to the United States for a summit of G8 leaders, the British prime minister, David Cameron, will say the eurozone "either has to make up or it is looking at a potential breakup", adding that the choice for Europe's leaders cannot be long delayed.

"Either Europe has a committed, stable, successful eurozone with an effective firewall, well capitalised and regulated banks, a system of fiscal burden sharing, and supportive monetary policy across the eurozone, or we are in uncharted territory which carries huge risks for everybody.

"Whichever path is chosen, I am prepared to do whatever is necessary to protect this country and secure our economy and financial system."

Officials from the Bank, the Treasury and the Financial Services Authority are drawing up plans in the expectation that a Greek departure from monetary union – increasingly seen as inevitable by financial markets – could be as damaging to the global economy as the collapse of Lehman Brothers in September 2008.

With a second election in Greece called for 17 June, King dropped a strong hint that the Bank would take fresh steps to stimulate growth if policymakers in Europe failed to deal with the sovereign debt crisis.

"We have been through a big global financial crisis, the biggest downturn in world output since the 1930s, the biggest banking crisis in this country's history, the biggest fiscal deficit in our peacetime history and our biggest trading partner, the euro area, is tearing itself apart without any obvious solution," he said.

Doug McWilliams, of the Centre for Economic and Business Research, said a planned breakup of the single currency would cost 2% of eurozone GDP ($300bn) but a disorderly collapse would result in a 5% drop in output, a $1tn loss. "The end of the euro in its current form is a certainty," he added.

Alistair Darling, who was Chancellor of the Exchequer under the former Labour administration, said: "This has the seeds of something disastrous. It is madness. If it spreads to bigger countries, this could be really disastrous for Europe. It could consign us to years of stagnation."

Capital flight from Greece has increased since it became clear that a coalition government could not be formed after the election earlier this month. The Greek president, Karolos Papoulias, said citizens were withdrawing their money amid "great fear that could develop into panic" at the risk of a debt default and exit from the euro area, according to minutes of their meetings posted on the presidency's website. In little more than a week following the election on 6 May, €3bn was withdrawn from bank accounts. The central bank reported that €800m was taken out in a single day earlier this week.

The head of the International Institute of Finance banking lobby, Charles Dallara, said money was leaving Greece at a growing pace due to political uncertainty. "There has been a pickup of deposit flight from Greece, but I think that is stabilisable once you get a new government in place, if that government reaffirms its intention to remain in the eurozone." The damage to the rest of Europe if Greece were to leave the euro would be "somewhere between catastrophic and armageddon", he said.

The Spanish prime minister, Mariano Rajoy, told parliament that his country faced trouble financing itself as borrowing costs shoot up to "astronomic" levels. The Irish finance minister, Michael Noonan, said Dublin's plan to return to capital markets in late 2013 might not be achievable because of the uncertainty.

The first meeting between French president Fran├žois Hollande and German chancellor Angela Merkel helped to calm nerves in the markets at one stage, with suggestions that Berlin might be amenable to initiatives to boost growth in Greece and the other austerity-stricken nations of the eurozone.

But the jittery mood was underlined by a fall in European shares and the single currency late in the day amid reports that the European Central Bank was cutting off its funding lifeline to Greek banks that had failed to amass enough capital to protect them from future losses.

The ECB later said it expected the Greek central bank to use part of the €130bn bailout from the EU and IMF to ensure that the country's banks were safeguarded from collapse, and that they would receive additional help from Frankfurt only once this had happened. Already delayed by the political uncertainty in Greece, €18bn is now expected to be released to recapitalise the banks.

Sony Kapoor, of the Brussels-based Re-Define thinktank, said: "The high-stakes game of chicken between Greek and other EU politicians must end now. Those saying that a Greek exit from the eurozone will not be a big deal either don't know what they are talking about, or have some ulterior motives. The social, political and economic damage to the EU from a Greek exit is potentially incalculable."

At the G8 summit, which starts on Friday, Obama will press Merkel tolean more towards a growth package for Europe, instead of pressing so hard for the austerity measures that were rejected by Greek voters.

But foreign affairs analysts said that Obama's leverage with the European leaders is minimal. Although the US has the economic muscle to help Europe out of its mess, the Obama administration has taken the strategic decision not to become involved directly.

Instead, Obama is to use the Camp David summit for some quiet diplomacy, hoping to sway Merkel to endorse some immediate actions to help growth.

King, speaking at the publication of the Bank of England's quarterly inflation report, said growth in Britain was weaker and inflation higher than Threadneedle Street had expected three months ago. It would take until 2014 for output to return to where it was in 2008, when Britain's deepest post-war recession began.

"What is so depressing about it is that this is a rerun of the debates in 2007/08 – these are not liquidity problems, they are solvency problems," King said. "Imbalances between countries in the euro area have created creditors and debtors and at some point the credit losses will need to be recognised and absorbed and shared around," he said.

"Until that is done, there will not be a resolution. That is why just kicking the can down the road is not an answer. The European Central Bank has performed heroically in trying to buy time but that time hasn't been used to put in place fundamental underlying solutions."

The Guardian