The Mark of the Beast, Part 1, video from 1996

Killing the Middle Class

 

If one takes the mainstream media seriously, Ben Bernanke’s announcement that the Federal Reserve would begin “tapering” its purchase of government bonds and mortgage securities by $10 billion dollars per month was the reason for Wall Street’s rally on Wednesday. Yet as the chart here reveals, the reaction to the Fed’s decision was a rapid and precipitous drop first, followed by a large rally, when Bernanke dropped the far more important shoe: interest rates would remain near zero for the foreseeable future. Thus, the nation remains wedded to a policy best described by Andrew Huszar, who was responsible for executing the first round of Quantitative Easing (QE), as “the greatest backdoor Wall Street bailout of all time.”

And while Wall Street has flourished, Main Street remains mired in the “new normal.” It is the new normal where a staggering 75 percent of the jobs created this year have not only been part-time, but low-paying. It is the new normal where the “decline” in unemployment to 7 percent is belied by the reality that a record high 91,541,000 of Americans are no longer in the labor force as of October, and the workforce participation rate is 63 percent, the lowest its been since 1978. Some of that decline can be attributed to Baby Boomers retiring, but the participation rate of workers aged 16-54 also declined during the recession–and has yet to recover.

And that’s assuming the figure of 7 percent unemployment itself hasn’t been manipulated, apart from not counting those who are no longer looking for work. The House Committee on Oversight and Government Reform has initiated an investigation into a New York Post report that employment data leading into the 2012 election may have been deliberately manipulated. “Just two years before the presidential election, the Census Bureau had caught an employee fabricating data that went into the unemployment report, which is one of the most closely watched measures of the economy,” writes the Post’s John Crudele. ”And a knowledgeable source says the deception went beyond that one employee–that it escalated at the time President Obama was seeking reelection in 2012 and continues today.”

Tellingly, the Fed’s announcement on Wednesday makes yet another reference to the reality that the continuing implementation of QE has been predicated, at least in part, on the unemployment rate. For months, Bernanke insisted he would continue QE and its low-interest rate environment until the unemployment rate dipped below 6.5 percent. How the Fed could base anything on employment figures that are deceiving at best, or an outright hoax at worst, demonstrates how desperate they are to pursue their policies irrespective of reality.

Yet a little reality intruded nonetheless. As CNBC noted, in the midst of Wednesday’s stock market euphoria ”a sharp jump in new jobless claims in the latest week to 379,000 and an upward revision to the number of the prior week’s new claims offered the market little support.”

What really offered the market support was the far less subtle change in interest rate policy that accompanied the taper. Just under two years ago, Bernanke announced that the Fed planned to keep interest rates low through 2014, as part of a policy that even the New York Times characterized as one “that began as shock therapy in the winter of 2008” and transformed “into a six-year campaign to increase spending by rewarding borrowers and punishing savers.”

Last month, Boston Fed President Eric Rosengren contended that particular brand of shock therapy could continue into 2016. “You could easily imagine if we have relatively slow growth in the overall economy, even though it picks up from where we are now, that it could be 2016,” he said. “You’d certainly need to have growth 3 percent or faster if you’d want to see short-term rates rising at that point.”

On Wednesday, that assessment changed once again. The Fed will now keep interest rates near zero, ”well past” the time when the unemployment rate falls below 6.5 percent. What does “well past” mean? Whatever the Fed decides it means.

Those interest rates have been a godsend for Wall Street, forcing many investors out of low-yield bonds into equities, which have soared. But the harsh reality of the Wall Street boom underscores the phoniness of Democrats’ concern with regard to addressing the “income inequality” President Obama characterized as a “fundamental threat” to American prosperity: 5 percent of Americans hold 60 percent of stock market wealth, and the top 10 percent own 80 percent of it.

It is that asset wealth that has fueled income inequality more than anything else over the last five years. A study conducted by economists at the University of California, Berkeley, the Paris School of Economics and Oxford University reveals that the top one percent of earners garnered 19.3 percent of household income in 2012. That’s their largest share of the pie since 1928.


One of the study’s authors, Emmanuel Saez of the University of California, Berkeley, contends that the surge may be due in part to those Americans cashing in stocks to avoid higher capital gains taxes that kicked in last January. He admits that some of the data is based on projection and could be revised, but hisestablished data covering the years 2009-2012 is equally telling. ”Top 1 percent incomes grew by 31.4 percent while bottom 99 percent incomes grew only by 0.4 percent from 2009 to 2012,” he writes. ”Hence, the top 1 percent captured 95 percent of the income gains in the first three years of the recovery.”

In spite of this data, Bernanke insists that the Fed’s objectives “are squarely tied to Main Street,” as he insisted in response to questions at the National Economists Club last month. “The economy has been growing, jobs have been coming back and the Fed has been an important factor in maintaining that momentum.”

Again, this is the weakest recovery since the Great Depression, job growth is overwhelmingly part-time and low-paying, and the Fed has created a massive asset bubble best described by David Stockman, who was President Reagan’s director of the Office of Management and Budget: “The Fed is exporting this lunatic policy worldwide,” he explained. “Central banks all over the world have been massively expanding their balance sheets, and as a result of that there are bubbles in everything in the world, asset values are exaggerated everywhere.” This is due to the reality that there is a virtually unlimited supply of money–printed out of thin air, no less–chasing a fixed set of assets. As a result, Stockman noted one other unfortunate reality: most bubbles come to a violent end.

Thus, the art is letting the air out of the bubble gently, which is what the taper is all about. Yet there is an unseemly level of hubris attached to the idea that the Federal Reserve can maintain that kind of control. As the NY Post’s John Crudele explains, there comes a point in time when those willing to finance American’s unconscionable level of debt begin to realize “they too are being fleeced” by near-zero interest rates ”simply because the Fed has been the shill in the crowd at each bond auction for half a decade.”

That would be the same half a decade in which the rich got much richer and the middle class stagnated, even as Americans have been told time and again by this administration that things are getting better–even as interest rates remain at historic lows precisely because they aren’t. Art Cashin, director of floor operations for UBS, best explains what is occurring after five years of unrestrained stimulus: “This market, this whole economy has kind of a split personality,” Cashin said. “Wall Street is making a record, and yet your brother-in-law can’t find a job.”

Credit to Frontpage Magazine

Do We Even Need a Banking Sector? Not Any More

An automated banking utility has no need for parasitic bankers or politicos or indeed, a central bank.

Do we need a banking sector dominated by politically untouchable "Too Big to Fail" (TBTF) banks? Thanks to fast-advancing technology, the answer is a resounding no. Not only do we not need a banking sector, we would be immensely better off were the banking sector to wither and vanish from the face of the Earth, along with its parasitic class of political enablers, toadies and Federal Reserve apparatchiks.

The key to understanding why big banks have outlived their purpose is to grasp the implications of computing power, self-organizing networks and crowdsourcing. Banks came into existence to manage the accumulation of capital (savings) and distribute the capital to borrowers in a prudent manner that minimized risk and still yielded a return for savers and the bank's investors/owners.

Back in the pre-computer era, the record-keeping and risk management processes of these two core functions required a complex bureaucracy and a concentration of accounting skills and lending experience. The costs of operating this record-keeping and risk management bureaucracy was high, and these costs justified the bank's fees and interest rate spread. In an idealized scenario, a bank might pay depositors 3% annual yield on their savings and charge borrowers 5%. The 2% spread was the bank's to keep for performing the accounting, collection and risk management functions.

Today, computers running scripts/programs can perform these functions with minimal human oversight and at very low cost. The tracking and recording of millions of transactions and accounts no longer requires thousands of clerks and a large institutional bureaucracy; a relative handful of software engineers are all that's needed to maintain these services, which are in effect a low-cost utility.

Risk management and lending are also computerized; the human interface of a banker is a bow to tradition, not necessity. Crowdsourced funding is entirely computerized: those with money/capital choose to join a pool of lenders who accept the risk of lending to an individual, household, project or enterprise for a specified return.

This process of aligning excess capital (savings) with borrowers is already automated. Is there a role for regulation? Absolutely: such a system requires transparency that can be trusted. Those who violate this trust with cooked-books, lies, misinformation, etc. must suffer negative, long-lasting consequences, starting with being banned from the system.

It is an abiding irony that the present banking system's secret portfolios and processes (shadow banking, derivatives designed to fail and trigger profitable defaults, etc.) are considered core competitive advantages: in other words, eliminating transparency generates the highest-return bank profits.

And let's not overlook the political consequences of these immense profits: a political and regulatory order that is easily captured to serve the interests of big banks. The number one agenda item is of course to arrange Central State protection of the most profitable (i.e. the least transparent) parts of the banking sector's operations.

This lack of transparency distorts the financial market, rendering it systemically vulnerable to malinvestments and risky speculations and the financial crashes that result from these systemic distortions.

The other top agenda item for bank lobbyists is to arrange Central State/Federal Reserve subsidies of bank profits. These subsidies are also known as financial repression, as the Central State/Bank rigs interest rates and regulations to favor bank profits at the expense of both savers and borrowers.

Thanks to the Federal Reserve's Zero Interest Rate Policy (ZIRP), savers have been robbed of hundreds of billions of dollars in income--money that has been effectively transferred to the banks by the State. This is why I call our system State-Cartel capitalism, as the State and cartels rule in a mutually beneficial marriage at the expense of the real economy, the citizenry and especially what's left of the dwindling middle class.

Since the core functions of banks can now be performed by cheap processors and software, we can get rid of the entire parasitic banking sector, once and for all. But what about investment banking? That too can be automated. What about wealth management? In a world where index funds beat 96% of money managers over a long time-frame, that too can be automated.

But what about the tens of millions of dollars in campaign contributions politicos skim from the bankers? Now we finally reach the real reason why the parasitic banking sector is allowed to exist, even though it has outlived its purpose and value: the political class of parasites benefits immensely from the banking sector's giant state-rigged skimming machine.

An automated banking utility has no need for parasitic bankers or politicos or indeed, a central bank. The only legitimate regulatory function of the state is to enforce transparency; beyond that, its actions are all subsidies of one sort or another of politically powerful constituencies at the expense of the real economy's productive people, communities and enterprises.

Cedit to Zero Hedge

First, You’ve Got To Get Mad!

Think this is the TSA? Think again, this is the NFL. But go back to sleep the Stasi invasion of the NFL may be gone when you wake up!

The crux of my next article, following this one, focuses on your chances of surviving in a detention camp and what history teaches about which strategies works best in such an environment.  Oh, I know some of you do not believe that perceived dissidents and other undesirables will ever be incarcerated during times of martial law and great civil unrest. You believe so, at your own peril.

Every professional sports league has signed an agreement with DHS to allow their facilities to be used as “housing centers” during times of national emergency. As I have previously documented, the NFL has already practiced for a martial law event in both Denver and New York. Additionally, Simon Properties, the largest owner of malls and strip malls in North America, has signed a similar agreement with DHS.

I believe that, after reading the first three parts of this series, if  you are not as mad as hell, then you are brain dead or not paying attention. Despite all the evidence, you just sit there and take it. You men of this country are nothing but sheep. You have allowed a TSA pot bellied pervert to stick their hands down the pants of your child and feel up your wife’s breasts and you just let it happen when you should either refuse to fly or punch out these perverts who should be charged with second degree sexual assault.

If you are OK with this, then you are not a man!

Sheep of America, has all the testosterone left your body? Has your backbone disappeared? What the hell is wrong with you so-called men? If you let the TSA feel up your kids today, you will have no problem accepting the day when the state takes them away from you, now will you?

Before I speak of the danger that lies ahead, when many of us are sheepishly herded into detention and extermination camps, we must first rediscover our collective manhood. If we have any chance of surviving what is coming our way, then we must first become aware of what is going on and then we must get as mad as hell. It does, neither you or me, any good to read about the coming dangers if you first aren’t willing to get mad. If you are not willing to get mad, then you will do nothing as you and yours are thrown upon the junk pile of history.

Do You Think the Following Is Just Some Big Joke?

As have I documented, the winds of civil war are blowing across this nation. Obama has fired 200+ command level officers from the military. The military and Obama are engaged in a game of chicken. When, not if, hostilities break out, these detention centers will go live. For those that say that this will never happen, ask yourself why the government is practicing for martial law; ask yourself why the NDAA, Executive Order 13603 and the Civilian Inmate Labor Brigade were passed into law? Why are key globalists actively calling for depopulating humanity by 90%? Is all of this just one great big joke? Do you think they are just kidding or this is some form of mental masturbation? Why won’t more of you pay attention to what they are saying along with what they are doing?

A List of Grievances

We find our mortal enemies, the two countries that have threatened to nuke us in the last year, namely, the Russians and the Chinese on our soil training to subjugate and kill your family if necessary, you have got to get mad! The Constitution is gone and your jobs have been shipped overseas; you have got to get mad! Your children have a greatly diminished future ; you have got to get mad. God has been systematically taken out of our society; you have got to get mad! There are going to be more attempted false flag events; you have got to get mad! Obama is allowing this country’s defense to be compromised; you have got to get mad! Your children “belong to the collective”; you have got to get mad! We have a President who has done NOTHING for the middle class; you have got to get mad! People are going to die, and again, you have got to get mad.

In one of the most memorable five minutes in movie history, the mythical Howard Beale tells America what they need to hear. Before we do anything at all to fight against the injustice, we have got to get as mad as hell and declare that we are not going to take this anymore.

If we do not get mad, if we do not rise and stare tyranny in the face, most of us will surely perish. After reading this article, I would ask you to listen to the wisdom of Howard Beale. Take 5 minutes and watch the following video. If you do not share the passion of a Howard Beale, then we do not need you in the Patriot movement because you have already signed your own death warrant.

Get Off Your Butt, Or Go Back to Sheep

If you are not mad as mad as hell, then go back to sheep! We do not need you and you will only drag us down. IF, on the other hand, you find yourself angry beyond belief, then transfer that passion into action. Prepare to survive without outside support. Educate friends and neighbors, but ignore the hopelessly blinded sheep as they will only drain your energy.

There are some potentially very dark days which lie ahead. Take time to enjoy your family and friends at this special time of year. However, you should all take your motivation for renewed patriotic action by considering what the other side has planned for you and that is the topic of the next article in this series.

Credit to The Common Sense 

Cyber Threats to Bank Accounts on the Rise

On the same day that news broke that 40 million customer account records were stolen from retail giant Target, the regulator of the nation’s largest financial institutions warned that customers’ financial information is increasingly under assault in their banks as well.

The Office of the Comptroller of the Currency on Thursday, in its Semiannual Risk Perspective, warned that “Cyber-threats continue to increase in sophistication and frequency.” The agency noted, “Known impacts include … identity theft, fraud, and theft of intellectual property.”

Related: Data Breach May Impact 40M Target Customers

The report found that one new tactic employed by hackers is to target a bank’s home page with a so-called “denial of service” attack, in which thousands of hacked computers try to log on to the web site simultaneously, thereby disabling it for regular customers’ use. While security experts are distracted by the DOS attack, the report found, the hackers go after their real target by, for instance, draining customer accounts through fraudulent wire transfers.

“It’s an increasing problem,” agreed Richard F. Cross, a former vice president and director of bank security at Bank of New York, now a private consultant. “You have to assume that the crooks are always one step ahead of what the financial community is doing to protect itself.”

The OCC cautioned that small banks appear to be more frequent targets of hackers, because criminals perceive them as being less likely to have strong security measures in place.

Cross said that in his experience, that tends to be true. “The problem usually is with small community banks,” he said. “I hate to say it, but sometimes they don’t want to spend the money.”

Related: The Coming Cyber Attack That Could Ruin Your Life

Protection doesn’t come cheap, the OCC found. While the tools necessary to reduce the risk of a cyber attack are “readily available,” according to the report, “the costs and resources needed to manage the risks continue to increase.”

Banks that are at increased risk, the agency said, are early adopters of new technologies, and banks that hire third parties to provide certain information technology-related services, both of which create additional risks that are difficult to measure and to manage.

The good news for consumers is that they can do a lot to protect themselves. Most cases of identity theft and bank fraud begin with the customer making the mistake of providing personal information, willingly or unwillingly, to crooks – although they often won’t know it until later.

Related:  Why Cyber Crime Is Now the Top Threat Facing the U.S.

One of the most common methods is through “phishing” – a technique in which an official-looking email is sent to a bank customer either directly soliciting account information or carrying a hidden computer virus that will give hackers access to the customer’s computer.

Cross cautioned that consumers can’t rely solely on banks to protect them – and have to be aware of everything they do while online.

Yahoo Finance

The Taper Is On – 8 Ways That This Is Going To Affect You And Your Family

The unelected central planners at the Federal Reserve have decided that the time has come to slightly taper the amount of quantitative easing that it has been doing.  On Wednesday, the Fed announced that monthly purchases of U.S. Treasury bonds will be reduced from $45 billion to $40 billion, and monthly purchases of mortgage-backed securities will be reduced from $35 billion to $30 billion.  When this news came out, it sent shockwaves through financial markets all over the planet.  But the truth is that not that much has really changed.  The Federal Reserve will still be recklessly creating gigantic mountains of new money out of thin air and massively intervening in the financial marketplace.  It will just be slightly less than before.  However, this very well could represent a very important psychological turning point for investors.  It is a signal that "the party is starting to end" and that the great bull market of the past four years is drawing to a close.  So what is all of this going to mean for average Americans?  The following are 8 ways that "the taper" is going to affect you and your family...

1. Interest Rates Are Going To Go Up

Following the announcement on Wednesday, the yield on 10 year U.S. Treasuries went up to 2.89% and even CNBC admitted that the taper is a "bad omen for bonds".  Thousands of other interest rates in our economy are directly affected by the 10 year rate, and so if that number climbs above 3 percent and stays there, that is going to be a sign that a significant slowdown of economic activity is ahead.

2. Home Sales Are Likely Going To Go Down

Mortgage rates are heavily influenced by the yield on 10 year U.S. Treasuries.  Because the yield on 10 year U.S. Treasuries is now substantially higher than it was earlier this year, mortgage rates have also gone up.  That is one of the reasons why the number of mortgage applications just hit a new 13 year low.  And now if rates go even higher that is going to tighten things up even more.  If your job is related to the housing industry in any way, you should be extremely concerned about what is coming in 2014.

3. Your Stocks Are Going To Go Down

Yes, I know that stocks skyrocketed today.  The Dow closed at a new all-time record high, and I can't really provide any rational explanation for why that happened.  When the announcement was originally made, stocks initially sold off.  But then they rebounded in a huge way and the Dow ended up close to 300 points.

A few months ago, when Fed Chairman Ben Bernanke just hinted that a taper might be coming soon, stocks fell like a rock.  I have a feeling that the Fed orchestrated things this time around to make sure that the stock market would have a positive reaction to their news.  But of course I absolutely cannot prove this at all.  I hope someday we learn the truth about what actually happened on Wednesday afternoon.  I have a feeling that there was some direct intervention in the markets shortly after the announcement was made and then the momentum algorithms took over from there.

In any event, what we do know is that when QE1 ended stocks fell dramatically and the same thing happened when QE2 ended.  If you doubt this, just check out this chart.

Of course QE3 is not being ended, but this tapering sends a signal to investors that the days of "easy money" are over and that we have reached the peak of the market.

And if you are at the peak of the market, what is the logical thing to do?

Sell, sell, sell.

But in order to sell, you are going to need to have buyers.

And who is going to want to buy stocks when there is no upside left?

4. The Money In Your Bank Account Is Constantly Being Devalued

When a new dollar is created, the value of each existing dollar that you hold goes down.  And thanks to the Federal Reserve, the pace of money creation in this country has gone exponential in recent years.  Just check out what has been happening to M1.  It has nearly doubled since the financial crisis of 2008...

The Federal Reserve has been behaving like the Weimar Republic, and this tapering does not change that very much.  Even with this tapering, the Fed is still going to be creating money out of thin air at an absolutely insane rate.

And for those that insist that what the Federal Reserve is doing is "working", it is important to remember that the crazy money printing that the Weimar Republic did worked for them for a little while toobefore ending in complete and utter disaster.

5. Quantitative Easing Has Been Causing The Cost Of Living To Rise

The Federal Reserve insists that we are in a time of "low inflation", but anyone that goes to the grocery store or that pays bills on a regular basis knows what a lie that is.  The truth is that if the inflation rate was still calculated the same way that it was back when Jimmy Carter was president, the official rate of inflation would be somewhere between 8 and 10 percent today.

Most of the new money created by quantitative easing has ended up in the hands of the very wealthy, and it is in the things that the very wealthy buy that we are seeing the most inflation.  As one CNBC article recently stated, we are seeing absolutely rampant inflation in "stocks and bonds and art and Ferraris and farmland".

6. Quantitative Easing Did Not Reduce Unemployment And Tapering Won't Either

The Federal Reserve actually first began engaging in quantitative easing back in late 2008.  As you can see from the chart below, the percentage of Americans that are actually working is lower today than it was back then...

The mainstream media continues to insist that quantitative easing was all about "stimulating the economy" and that it is now okay to cut back on quantitative easing because "unemployment has gone down".  Hopefully you can see that what the mainstream media has been telling you has been a massive lie.  According to the government's own numbers, the percentage of Americans with a job has stayed at a remarkably depressed level since the end of 2010.  Anyone that tries to tell you that we have had an "employment recovery" is either very ignorant or is flat out lying to you.

7. The Rest Of The World Is Going To Continue To Lose Faith In Our Financial System

Everyone else around the world has been watching the Federal Reserve recklessly create hundreds of billions of dollars out of thin air and use itto monetize staggering amounts of government debt.  They have been warning us to stop doing this, but the Fed has been slow to listen.

The greatest damage that quantitative easing has been causing to our economy does not involve the short-term effects that most people focus on.  Rather, the greatest damage that quantitative easing has been causing to our economy is the fact that it is destroying worldwide faith in the U.S. dollar and in U.S. debt.

Right now, far more U.S. dollars are used outside the country than inside the country.  The rest of the world uses U.S. dollars to trade with one another, and major exporting nations stockpile massive amounts of our dollars and our debt.

We desperately need the rest of the world to keep playing our game, because we have become very dependent on getting super cheap exports from them and we have become very dependent on them lending us trillions of our own dollars back to us.

If the rest of the world decides to move away from the U.S. dollar and U.S. debt because of the incredibly reckless behavior of the Federal Reserve, we are going to be in a massive amount of trouble.  Our current economic prosperity greatly depends upon everyone else using our dollars as the reserve currency of the world and lending trillions of dollars back to us at ultra-low interest rates.

And there are signs that this is already starting to happen.  In fact, China recently announced that they are going to quit stockpiling more U.S. dollars.  This is one of the reasons why the Fed felt forced to do something on Wednesday.

But what the Fed did was not nearly enough.  It is still going to be creating $75 billion out of thin air every single month, and the rest of the world is going to continue to lose more faith in our system the longer this continues.

8. The Economy As A Whole Is Going To Continue To Get Even Worse

Despite more than four years of unprecedented money printing by the Federal Reserve, the overall U.S. economy has continued to decline.  If you doubt this, please see my previous article entitled "37 Reasons Why 'The Economic Recovery Of 2013' Is A Giant Lie".

And no matter what the Fed does now, our decline will continue.  The tragic downfall of small cities such as Salisbury, North Carolina are perfect examples of what is happening to our country as a whole...

During the three-year period ending in 2009, Salisbury’s poverty rate of 16% was about 3% higher than the national rate. In the following three-year period between 2010 and 2012, the city’s poverty rate was approaching 30%. Salisbury has traditionally relied heavily on the manufacturing sector, particularly textiles and fabrics. In recent decades, however, manufacturing activity has declined significantly and continues to do so. Between 2010 and 2012, manufacturing jobs in Salisbury — as a percent of the workforce — shrank from 15.5% to 8.3%.

But the truth is that you don't have to travel far to see evidence of our economic demise for yourself.  All you have to do is to go down to the local shopping mall.  Sears has experienced sales declines for 27 quarters in a row, and at this point Sears is a dead man walking.  The following is from a recent article by Wolf Richter...

The market share of Sears – including K-Mart – has dropped to 2% in 2013 from 2.9% in 2005. Sales have declined for years. The company lost money in fiscal 2012 and 2013. Unless a miracle happens, and they don’t happen very often in retail, it will lose a ton in fiscal 2014, ending in January: for the first three quarters, it’s $1 billion in the hole.

Despite that glorious track record, and no discernible turnaround, the junk-rated company has had no trouble hoodwinking lenders into handing it a $1 billion loan that matures in 2018, to pay off an older loan that would have matured two years earlier.

And J.C. Penney is suffering a similar fate.  According to Richter, the company has lost a staggering 1.6 billion dollars over the course of the last year...

Then there’s J.C. Penney. Sales plunged 27% over the last three years. It lost over $1.6 billion over the last four quarters. It installed a revolving door for CEOs. It desperately needed to raise capital; it was bleeding cash, and its suppliers and landlords had already bitten their fingernails to the quick. So the latest new CEO, namely its former old CEO Myron Ullman, set out to extract more money from the system, borrowing $1.75 billion and raising $785 million in a stock sale at the end of September that became infamous the day he pulled it off.

So don't believe the hype.

The economy is getting worse, not better.

Quantitative easing did not "rescue the economy", but it sure has made our long-term problems a whole lot worse.

And this "tapering" is not a sign of better things to come.  Rather, it is a sign that the bubble of false prosperity that we have been enjoying for the past few years is beginning to end.

Credit to Economic Collapse

Russia to Develop 5th-Generation Attack Helicopter by 2017

PERM, December 19 (RIA Novosti) – It could take Russia about three years to complete the development of a fifth-generation attack helicopter and start testing its prototype, a defense industry official said Wednesday.

The Mi-28NM, a modernized version of the Mi-28N Night Hunter attack helicopter that is being upgraded to standards of a fifth-generation aircraft, has been in development since 2008.

“I think we will need no more than three years to develop a new modernized version of the Mi-28N helicopter,” said Andrei Shibitov, chief executive officer of the Russian Helicopters company.

Shibitov did not specify the characteristics of the future combat helicopter, but he was quoted earlier by the Russian media as saying that the criteria for a fifth-generation attack helicopter must include low radar signature, an extended flying range, an advanced weapons control system, the capability to combat fighter jets and have a speed of up to 600 kilometers (370 miles) per hour.

Credit to RIA Novosti

"The Chinese Don't Want Dollars Anymore, They Want Gold" - London's Gold Vaults Are Empty: This Is Why

Today gold slid under $1200 per ounce, dropping to a level not seen in three years. Judging by the price action one would think that gold is not only overflowing from precious metal vaults everywhere, but can be found thrown away on the street, where nobody even bothers to pick it up. 

One would be wrong. In fact, as Bloomberg's Ken Goldman reports, "you could walk into a vault in London and they were packed to the rafter with gold, and the gold would trade from me to you to somebody else. You could walk into these vaults today and they are virtually empty. All that gold has been transferred out of London, 26 million ounces...." To find out where it has gone and why it is never coming back, watch the clip below (spoiler alert: listen for the line: "the Chinese don't want US dollars anymore, they want gold").

Neanderthal woman's genome reveals unknown human lineage

The existence of a mysterious ancient human lineage and the genetic changes that separate modern humans from their closest extinct relatives are among the many secrets now revealed in the first high-quality genome sequence from a Neanderthal woman, researchers say.

The Neanderthal woman whose toe bone was sequenced also reveals inbreeding may have been common among her recent ancestors, as her parents were closely related, possibly half-siblings or another near relation.

Although modern humans are the world's only surviving human lineage, others also once lived on Earth. These included Neanderthals, the closest extinct relatives of modern humans, and the relatively newfound Denisovans, whose genetic footprint apparently extended from Siberia to the Pacific islands of Oceania. Both Neanderthals and Denisovans descended from a group that diverged from the ancestors of all modern humans. 

The first signs of Denisovans came from a finger bone and a molar tooth discovered in Denisova Cave in southern Siberia in 2008. To learn more about Denisovans, scientists examined a woman's toe bone, which was unearthed in the cave in 2010 and showed physical features resembling those of both Neanderthals and modern humans. The fossil is thought to be about 50,000 years old, and slightly older than previously analyzed Denisovan fossils.

Human interbreeding
The scientists focused mostly on the fossil's nuclear DNA, the genetic material from the chromosomes in the nucleus of the cell that a person receives from both their mother and father. They also examined the genome of this fossil's mitochondria the powerhouses of the cell, which possess their own DNA and get passed down solely from the mother.

The investigators completely sequenced the fossil's nuclear DNA, with each position (or nucleotide) sequenced an average of 50 times. This makes the sequence's quality at least as high as that of genomes sequenced from present-day people.

The genetic analysis revealed the toe bone belonged to a Neanderthal. When compared with other Neanderthal mitochondrial DNA samples, this newfound fossil's closest known relatives are Neanderthals found in Mezmaiskaya Cave in the Caucasus Mountains about 2,100 miles away.

These findings helped the scientists refine the human family tree, further confirming that different human lineages interbred. They estimated about 1.5 to 2.1 percent of DNA of people outside Africa are Neanderthal in origin, while about 0.2 percent of DNA of mainland Asians and Native Americans is Denisovan in origin.

"Admixture seems to be common among human groups," said study lead author Kay Prfer, a computational geneticist at the Max Planck Institute for Evolutionary Anthropology in Leipzig, Germany.

Intriguingly, the scientists discovered that apparently Denisovans interbred with an unknown human lineage, getting as much as 2.7 to 5.8 percent of their genomes from it. This mystery relative apparently split from the ancestors of all modern humans, Neanderthals and Denisovans between 900,000 years and 4 million years ago, before these latter groups started diverging from each other.

This enigmatic lineage could even potentially be Homo erectus, the earliest undisputed predecessor of modern humans. There are no signs this unknown group interbred with modern humans or Neanderthals, Prferadded. [The 10 Biggest Mysteries of the First Humans]

"Some unknown archaic DNA might have caught a ride through time by living on in Denisovans until we dug the individual up and sequenced it," Prfertold LiveScience. "It opens up the prospect to study the sequence of an archaic (human lineage) that might be out of reach for DNA sequencing."

Interbreeding took place between Neanderthals and Denisovans as well. These new findings suggest at least 0.5 percent of the Denisovan genome came from Neanderthals. However, nothing of the Denisovan genome has been detected in Neanderthals so far.

In addition, "the age of the Neanderthals and Denisovans we sequenced also doesn't allow us to say whether any gene flow from modern humans to Neanderthals or Denisovans happened," Prfer said. The Neanderthals and Denisovans that researchers have sequenced the DNA of to date "probably lived at a time when no modern humans were around," he explained.

Modern humans' distinguishing features
It remains uncertain when modern humans, Neanderthals and Denisovans diverged from one another. The researchers currently estimate modern humans split from the common ancestors of all Neanderthals and Denisovans between 550,000 and 765,000 years ago, and Neanderthals and Denisovans diverged from each other between 381,000 and 473,000 years ago.

Genetic analysis revealed the parents of the woman whose toe bone they analyzed were closely related possibly half-siblings, or an uncle and niece, or an aunt and nephew, or a grandfather and granddaughter, or a grandmother and grandson. Inbreeding among close relatives was apparently common among the woman's recent ancestors. It remains uncertain as to whether inbreeding was some kind of cultural practice among these Neanderthals or whether it was unavoidable due to how few Neanderthals apparently lived in this area, Prfer said.

By comparing modern human, Neanderthal and Denisovan genomes, the researchers identified more than 31,000 genetic changes that distinguish modern humans from Neanderthals and Denisovans. These changes may be linked with the survival and success of modern humans a number have to do with brain development.

"If one speculates that we modern humans carry some genetic changes that enabled us to develop technology to the degree we did and settle in nearly all habitable areas on the planet, then these must be among those changes," Prfer said. "It is hard to say what exactly these changes do, if anything, and it will take the next few years to find out whether hidden among all these changes are some that helped us modern humans to develop sophisticated technology and settle all over the planet."

Prfer and his colleagues detailed their findings in the Dec. 19 issue of the journal Nature.

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