The Housing Bubble

Wall Street Journal - Washington, DC: The New Boomtown

“As other American cities have been buffeted by an uneven economy, Washington’s property market has been buoyed two forces specific to the capital city: a surge of federal contractors and a rising tide of government spending. The result: what real-estate agents and developers are calling an unprecedented real-estate surge.

Washington’s economy—which was never hit as hard during the recession as other major U.S. cities—is flourishing. From 2007 through 2012, the local economy expanded 7.6%, compared with the nation’s growth of 5.4%, according to economist Stephen Fuller of George Mason University. Federal procurement spending in the Washington area increased by 182% from 2000 through 2010, which has led to an influx of contractors, lawyers and consultants. Overall, the area saw a population increase of 776,280 between 2000 and 2010.

According to Mr. Fuller, annual government spending on federal contractors in the D.C. metro area increased from $12.6 billion in 1990 to $29.3 billion in 2000, and to $82.5 billion in 2010.

http://online.wsj.com/article/SB10001424127887324767004578489202247919668.html

Luckily for Bitcoin owners, the virtual currency is never used to transact trade in illegal goods and services.

Hello again from Gotham- Sales are brisk, there is no supply, and people are fighting at open houses. Every salesperson wants to be a millionaire next week with BernankeBucks, and nobody can find skilled labor to build any new buildings. New buildings are usually stopped at least 3 times by the DOB, as “interested parties” just have to call 311 to get an inspector on the site. The unions continue to deteriorate as they compete against contractors who get labor with subsidized or free housing, food, insurance, and care for kids while working off the books. The currency today is green cards- come work and we will help you to get your entire extended family into the country and onto the dole- and preferably onto disability with our hand-picked judges.

The Dem Mayoral race is fun- NYC wants to avoid voting for a lesbian with a wife, as the media (for now) attacks and vaccinates a guy who got caught being hetero on the internet. His co-religionists can overlook this as he promises to continue Bloomberg light instead of a shift to the tax-hiking left. The other candidates would make Marx blush, as they make promises to keep the thousands/millions of dependents voting at least 3 times on election day.

Quote of the day from an older RE student from the Projects to a young Israeli who just bought his first apartment in the city:

“You need us. We are the ones who do all of your work at $5/hour so that you can live your fancy lifestyles. We have larger apartments than the multi-million dollar condos nearby, and we deserve it”

-She expects that from her complexion that she has a choice of 3-bedroom apartments for $300/month.

-

Does your wife bring home the bacon?

Are home prices going up like gangbusters in your neck of the woods?

May 28, 2013, 11:23 AM
Real Estate News: Flippers Ride Housing Wave–Again
By WSJ Staff

Here is a look at real-estate news from the long weekend and today in the WSJ:

Flippers Ride Housing Wave: Rising home prices have fueled the return of a practice that some blamed for inflating the bubble: house flipping.
…
In California, Homes Bought and Resold Quickly Reach Highest Levels Since 2005

How can anyone possibly feel gloomy at this point, with U.S. home prices and consumer confidence climbing ever higher by the minute?

Because government run things the best.

And makes all things affordable. For the children.

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Mortgage Applications Decline 8.8%, US Homeowership Lower Than Most European Countries
Confounded Interest | 05/29/2013 | Anthony B. Sanders

According to the Mortgage Bankers Association (MBA), mortgage applications fell again last week. The applications fell 8.8%.

Mortgage refinancing applications fell by a whopping 12.30% while mortgage purchase applications rose by 2.58%. Here is the Bankrate 30 year fixed-rate average (yellow) and refinance applications (white) since May 2nd.

But here is a longer term view of mortgage purchase applications. Back to 1997 when the housing bubble started to form.

On a related issue, homeownership rates in the US fell to 65% from a peak of 69.2% during Q4 2004.

A 65% homeownership rate leaves the US below most of Europe except for France, Austria and Germany. And the US is barely above France although the US is the only country in the world with government sponsored enterprises (GSEs) like Fannie Mae and Freddie Mac.

Bottom Line: To get the money to buy the votes of the Free Sh*t Army you need an organization like the IRS.

————————

Americans Deserve the IRS
Townhall.com | May 29, 2013 | Walter E. Williams

Since the 1791 ratification of our Constitution, until well into the 1920s, federal spending as a percentage of gross domestic product never exceeded 5 percent, except during war. Today federal spending is 25 percent of our GDP. State and local government spending is about 15 percent of the GDP. That means government spends more than 40 cents of each dollar we earn. If we add government’s regulatory burden, which is simply a disguised form of taxation, the government take is more than 50 percent of what we produce.

In order to squeeze out of us half of what we produce, a government tax collection agency must be ruthless and able to put the fear of God into its citizens. The IRS has mastered that task. Congress has given it powers that would be deemed criminal if used by others. For example, the Constitution’s Fifth Amendment protects Americans against self-incrimination and being forced to bear witness against oneself. That’s precisely what one does when he is compelled to sign his income tax form. However, a Fifth Amendment argument can’t be used as a defense in a court of law. The IRS will counter that you voluntarily provided the information on your tax return.

If you’re in debt to Bank of America, Wells Fargo or any other private creditor, in order for it to garnish your wages as a means of collecting debt, it must first get a court order. By contrast, the IRS can garnish your wages without having to get a court order first. If your employer doesn’t obey the IRS and send it a portion of your wages, he will be held accountable for what you owe. At the minimum, some IRS collection procedures violate one of the basic tenets of the rule of law — namely, the law of the land applies equally to individuals (and other private entities) and the government (and its officials and agents).

If federal spending were only 5 percent of our GDP ($750 billion) — instead of 25 percent ($3.8 trillion) — there would be no need for today’s oppressive and complicated tax system. You might ask, “How could we be a great nation without all the government spending?” When our Constitution was ratified in 1791, we were a weak and poor nation. One hundred forty years later, with federal spending a mere pittance of what it is today, we became the world’s richest and most powerful nation. No small part of this miracle was limited and unintrusive government.

The bottom line is that members of Congress need such a ruthless tax collection agency as the IRS because of the charge we Americans have given them. We want what the IRS does — namely, to take the earnings of one American so Congress can create a benefit for some other American. Don’t get angry with IRS agents. They are just following orders.

From the NYT???

Maybe there is some hope for the MSM. But only when their goose is about to get cooked.

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Only Nixon Harmed a Free Press More
New York Times - James C. Goodale - May 29, 2013

The search warrant filed to investigate the Fox News reporter James Rosen proved as many had suspected: President Obama wants to make it a crime for a reporter to talk to a leaker. It is a further example of how President Obama will surely pass President Richard Nixon as the worst president ever on issues of national security and press freedom.

The government’s subpoena of The Associated Press’s phone records was bad enough. But the disclosure of the search warrant in the Rosen case shows President Obama has delved into territory never before reached by previous presidents.

The Justice Department obtained Rosen’s e-mail by using a search warrant in which it alleged that Rosen was a co-conspirator with a government adviser named Stephen Kim.

Until President Obama came into office, no one thought talking or e-mailing was not protected by the First Amendment.

Former Michigan Supreme Court Justice sentenced to prison for bank fraud
Ann Arbor — Former Michigan Supreme Court Justice Diane Hathaway called herself a broken person and delivered a tearful apology Tuesday for committing bank fraud but a federal judge still sent her to prison for 12 months and one day.

The sentence caps the biggest scandal to rock the state’s highest court in decades, a scandal that forced Hathaway to resign, surrender her law license and plead guilty in January.

The sentence did not satisfy Dan Pero, a Republican political consultant and president of the American Justice Partnership, a conservative group that aired radio ads against Hathaway last year questioning her house deals.

“She was a bad person who did a bad thing,” Pero said. “She got what she deserved but didn’t get enough.”

Pero faulted Hathaway for misleading her colleagues on the Supreme Court and the public.

“She stood in front of everybody and said she was innocent,” Pero said. “She never once apologized.”

He also said it is wrong that Hathaway gets to keep her public pension and an expensive vacation home in Florida.

“She is going to prison and that is a good thing,” Pero said. “It shows she is not above the law.”

Former Supreme Court Chief Justice Cliff Taylor, who lost to Hathaway in 2008, called the prison sentence a “mild penalty.”

Taylor questioned whether an average person would have received a similar sentence.

“I think people will wonder if this is the same kind of sentence a kid from the hood would have got,” Taylor said. “A year is a long time, of course, but it is important to send a message to powerful people who have powerful responsibilities that they cannot abuse them. Most people who rob banks get more than this.”

Taylor DID get more - the pension and the expensive Florida home.

Interesting article from the Grenwich times at the bottom of yesterday’s bits bucket. “modestly priced homes” from 764-899K.

Insane prices, if you get my drift. This is HA’s home turf. At that rate I expect you can rent for half the price of owning, even if prices crater by 65%.

“In other words, homeownership is becoming a little less attainable for the everyman and everywoman. The census says there are four primary reasons for this: High debt; Insufficient cash for a down payment; Poor credit history; or Interest rates that set the monthly mortgage payment too high for the family to afford on its current income.”

You forgot a reason Mr Census bureau - the price is way too high. Like 10 X too high.

The next president of the United States, our only hope to beat Hillary:

http://www.nytimes.com/2013/05/30/us/politics/michele-bachmann-wont-seek-re-election-next-year.html

Q: What do you call a school district that spends $20,000 per student but has falling down school buildings and poor test results?

A: A public union goon hell hole that just needs more money to fix itself.

PS - And it is for the children!

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District Spent $20K Per Student, Had Rodents In Schools, Holes In Ceiling and Walls
Michigan Capitol Confidential | 5/25/2013 | Audrey Spalding

Though the Highland Park School District spent $19,634 per pupil in 2010-11, which was the highest in the state, district schools were so mismanaged that they had rodents in the classrooms, holes in the ceilings and walls, and horrendous filth in the bathrooms.

“It was terrible,” said Delshon, a senior at HPCHS. “We had to worry if something was going to crawl on us; worry if the ceiling was going to fall in on us.

Though the Highland Park district was struggling financially and academically, it spent more money than every other district in the state. During the 2010-11 school year, Highland Park spent nearly $20,000 per student. And yet, the Highland Park schools are in utter disrepair.

Ultimately, the state gave Highland Park more than $8 million in extra funding so that it could pay its bills.

Prior to being charterized, some district officials were blaming state legislators for a lack of funding. The Michigan PTA President also called for more money. At the same time, the district was spending nearly $20,000 per student — well over a quarter of a million per classroom — while the district shed nearly half of its students

The previous teachers’ contract shows that the district paid 100 percent of health care premiums while granting special favors for the union, like handing over district financial information, setting up an automatic payroll deduction for dues, and allowed the local president to spend half of his or her time working exclusively on union business.

Guess what? The U.S. has had a mandatory savings policy since 1935.

It’s called Social Security.

Any questions?

“So if we’re truly committed to strengthening our middle class and providing more ladders of opportunity to those who are willing to work hard to make it into the middle class, we’ve got to fix the system. We have to make sure that every business and every worker in America is playing by the same set of rules. We have to bring this shadow economy into the light so that everybody is held accountable — businesses for who they hire, and immigrants for getting on the right side of the law. That’s common sense. And that’s why we need comprehensive immigration reform.”

President Barack Obama, January 29, 2013

That shadow economy is already in the light and has been for years, it has engulfed a large swath in the center of Jupiter.

Jupiter man accused of stabbing woman, fiance after paying for sex

By Julius Whigham II
Palm Beach Post Staff Writer
Posted: 9:39 a.m. Wednesday, May 29, 2013

JUPITER —
What began as an apparent meeting for sex ended with a 23-year-old Jupiter man’s arrest last weekend after he allegedly stabbed a woman and her fiance, town police said.

Horatio Marroquin was arrested Saturday on allegations of robbery, aggravated battery with a deadly weapon and solicitation. He remained in custody at the Palm Beach County Jail on Wednesday morning in lieu of $30,000 bond.

According to police, the incident began around 5 a.m. Saturday at a home in the 800 block of Philadelphia Drive. Police went to the house after initially responding to the emergency room at Jupiter Medical Center. There they learned that a 36-year-old man and 28-year-old woman had been stabbed, allegedly at Marroquin’s home.

The arrest report does not identify the stabbing victims.

Marroquin was taken into custody and questioned. His speech was somewhat slurred and he smelled of alcohol, the arresting officer noted in her report.

Marroquin told police the woman showed up unexpectedly at his home early Saturday asking if he wanted to pay for sex, the report said. Marroquin said he’d previously met the woman about six months ago while he was buying an item at a Circle K store. He alleged that, during that first encounter, the woman approached and asked if he wanted to do “business,” meaning exchange money for sex.

Marroquin said he agreed and took the woman to his house. Once inside, he gave the woman $40, but she ran away without engaging in any physical contact.

Marroquin said he did not chase her and decided to let the matter go, the report said.

On Saturday, the woman returned with the same offer, he told police. This time he refused, but eventually agreed when the woman reportedly called him later that morning.

According to the report, when the woman arrived, Marroquin told her to go to the back patio where he then gave her $24 in cash and $3 worth of coins.

While the two were getting undressed, another man, the woman’s fiance, allegedly came around a corner pointing a knife and demanding money.

Marroquin said he ran inside and grabbed a butcher knife and then went back to the patio to confront the other man. Angry that he had been robbed earlier, he was not going to let it happen again, he told officers.

According to the report, Marroquin grabbed the woman and placed his arm around her chest and neck. He threatened to cut her if he did not get his money. Marroquin said he did not recall stabbing the woman , but he did remember stabbing the other man at some point. He took away the other man’s knife and the woman gave him back the cash, the report said.

The wounded man suffered a significant stab wound to his upper left arm and had to be taken to St. Mary’s Medical Center in West Palm Beach.The woman had a gash on her left cheek.

Her fiance told police the couple had gone to a gas station with another woman, then to Marroquin’s house after fixing a dead battery. He stayed in the car while his fiance went to the house, the report said.

The man said he got out minutes later after hearing yelling. He told investigators that he asked Marroquin to let his fiance go, but Marroquin reached down for something near a chair and rushed toward him. The man said he was unaware of his fiance’s alleged sex-for-money arrangement and has nothing to do with whatever deals she makes with other people.

While being questioned at the hospital, the wounded woman initially refused to cooperate. But she later told officers that Marroquin was on the one who contacted her asking for sex. She said that Marroquin then attacked her because he was was angry that she’d robbed him, the report said.

http://www.palmbeachpost.com/s/news/ - 83k -

tocks are tanking…..

How long before a Fed statement saying they will NOT taper…..

What is going on with FNMA?

Remember when the GOP wasn’t run by teabillies?

http://www.dolekemp96.org/agenda/issues/issues.html

Look back at the Dole/Kemp platform ^^^.

It Will Take The Fed Seven Years To Deliver 300 Tons Of German Gold

Submitted by Tyler Durden on 01/16/2013 18:16 -0400

What is news is that courtesy of the supplied calendar of events in the Buba statement, it will take the Fed some seven years to procure Germany’s 300 tons of gold. This is the same Fed that, in its own words, holds some “216 million troy ounces of gold” or some 6720 tons, in its vault 80 feet below ground level.

Putting the above in perspective, the amount of gold that Germany will have to wait 7 years for is shown in red. The amount of gold the Fed supposedly holds, is shown in yellow with a shade of tungsten. Why it will take the Fed 7 years to part with an amount of gold that is less than 5% of its total holdings is anyone’s guess…

unless of course, the bulk of the gold in the column on the right has been rehypothecated numerous times to serve as collateral for countless counterparties, and it is no longer clear just who own what to anyone.

http://www.zerohedge.com/news/2013-01-16/it-will-take-fed-seven-years-deliver-300-tons-german-gold - 103k -

“If you bought a house 1998 to current, you’ve got rocks in your head.”

Analysis: Housing price gains mask lingering market weaknesses
By Tim Reid
LOS ANGELES | Tue May 28, 2013 7:30pm EDT
Reuters

(Reuters) - The recovery in the housing market is showing a pattern far different from what followed previous downturns, experts say, suggesting that the dramatic price gains of recent months may not be sustainable.

The surge in home prices, seen most recently in the Standard & Poor’s/Case-Shiller home price index released on Tuesday, is at least in part a function of record-low interest rates, extraordinarily low housing supply, and record-high volumes of investor money pouring into single family homes, analysts say.

http://www.reuters.com/article/2013/05/28/us-housing-recovery-analysis-idUSBRE94R11J20130528?feedType=RSS&feedName=businessNews

“American Exceptionalism” called out in The Atlantic:

http://www.theatlantic.com/business/archive/2013/05/america-where-the-poor-dont-get-holidays-off/276221/

“America: Where the Poor Work on Holidays”.

So proud. USA! USA!

http://finance.yahoo.com/blogs/the-exchange/road-japanese-debt-crisis-164423450.html

any opinions on Reno NV ?

The predictions given below are contingent on a group of conditions which may take decades to materialize.

By the time withdrawal is finally underway, bond yields will have fully corrected in anticipation. Likewise, the stock market will likely have already dropped significantly in anticipation.

Bulletin Dow ends down 106 points in worst day since May 1
Investor Alert

May 29, 2013, 6:00 a.m. EDT
4 ways the end of QE will surprise everyone
Commentary: End of central bank buying could benefit most markets
By Matthew Lynn
…
In truth, quantitative easing is an experiment. No one had tried it until the Japanese experiment started a decade ago. And certainly no one has ended it before. So we can’t have any real idea what precisely will happen. But here are four ways the end of QE will catch most investors out.

One, gold rises.
…
Two, banks rise in value.
…
Three, bond yields stay steady.
…
Four, equities rise.
…

Now would this be considered multitasking?

Luis Briones, New Mexico Man, Drove Drunk While Having Sex

05/29/13 10:28 AM ET EDT

ALBUQUERQUE, N.M. — A New Mexico man faces multiple charges after police say he was having sex with a woman while driving drunk and crashed, ejecting the woman from the vehicle.

The Albuquerque Journal reports () 25-year-old Luis Briones was found with one shoe on and his shorts on inside-out Monday night after he wrecked his Ford Explorer in Albuquerque. http://bit.ly/111Kb8Y

Police say Briones’ female passenger was found naked outside the SUV after being ejected. She had deep cuts to her face and head.

Authorities allege Briones tried to drive away after the crash and leave his passenger behind, but a witness grabbed his keys from the ignition. He also allegedly tried to hide from responding officers behind a cactus.

Briones is charged with aggravated DWI, reckless driving and evading police.

No attorney was listed for him.
Information from: Albuquerque Journal, http://www.abqjournal.com

http://www.huffingtonpost.com/2013/05/29/luis-briones-drove-drunk_n_3353382.html?utm_hp_ref=crime&ir=Crime -

Housing Bubble II: Euphoria And Other Shenanigans
Submitted by testosteronepit on 05/29/2013 12:31

Wolf Richter http://www.testosteronepit.com http://www.amazon.com/author/wolfrichter

The good old days are back. Those days during the last housing bubble when money grew on trees: home prices jumped 10.9% year over year, according to the S&P Case-Shiller 20-city Home Price Index, based on data through March 2013. On a monthly basis, the index rose 1.2%. Prices are now back to 2003 levels. The usual suspects: Phoenix soared 22.5% year over year, San Francisco 22.2%, Las Vegas 20.6%. You can’t lose money in real estate. I’m already hearing it again.

Flipping houses is back in vogue. People are jabbering about it on their cellphones while crossing streets without looking. Entire articles have been written about it, backed with reasonable-looking numbers, such as RealtyTrac’s “25 Markets Where Flipping Homes is Most Profitable.” The top three? Orlando, Las Vegas, and Phoenix. Visions of 2005!

The smart money is once again running national radio ads on how-to-flip-houses shenanigans. Pull out your credit card, call that 800-number, and get rich quick. On NPR, an “economist” said this morning that the housing market was “on fire.” That’s the sort of hard “data” that puts real gloss on NPR’s perspicacious coverage of the US economy. And everybody fingers the “tight” inventory – as hundreds of thousands of vacant and for-sale homes have evaporated, and as bidding wars are breaking out over what’s left. Or so it seems.

But vacant homes don’t evaporate. Private-equity funds have poured tens of billions into gobbling up vacant single-family homes in specific markets. And now some of them are planning IPOs as a way of dumping this stuff into funds that unsuspecting worker bees hold in their 401(k)s. It’s called an exit, and they have to do it before it blows up in their faces. Meanwhile, they’re hoping to rent out at least some of these vacant homes on their books, but vacancy rates of single-family homes are sky-high in these markets, with the stock of vacant homes having simply been moved from the for-sale list to the for-rent list where it languishes unnoticed by the gurus. That’s what free and unlimited money will do. I’ve hammered on this theme before…. Housing Bubble II: But This Time It’s Different.

Euphoria even shows up in the numbers. The Conference Board Consumer Confidence Index rose in May to 76.2 up from 69.0 in April, the highest level since February 2008. Not everyone was euphoric. Which was why the index hasn’t hit the stratosphere yet. But those among the respondents who benefitted from the Fed’s money-printing binge and the bubbles it engendered in corporate bonds, farmland, housing, the stock markets, even junk bonds… they felt flush; and just like in 2006 or 2007, when “Merger Monday” had become a day of the week, they felt wise for having made smart decisions. Forgotten were the fiscal cliff – whatever that had been – the payroll-tax hike, and the sequester. For the lucky ones, these inconveniences were drowned out by euphoria.

The Walmart crowd wasn’t so lucky, however, and if it hadn’t been for their presence, the index would have been soaring. So there were some hiccups: only 10.8% of the respondents thought that jobs were “plentiful”; while dismal, and a reminder of reality, it was up from an even more dismal 9.7% in April.

Everybody loves bubbles. People either don’t remember the wealth destruction and wealth transfers that took place when the last bubble blew up, or they think they, but not others, can get out in time, whether it’s through an IPO, a quick stock sale, or a real estate transaction. Governments love bubbles because they generate a flood of tax revenues – and even California is having illusions of a surplus. Central banks, and specifically the Fed, create bubbles and then deny their existence until afterwards when they bail out their cronies that hadn’t been able to get out in time – while others are left holding the bag. It’s an amazing show, with fireworks, suspense, dramatic plot twists, and a rousing score. And we get to watch it over and over again.

Since I write so much about financial fiascos, debacles, and nightmares, I’ve been asked about ways to protect assets in this environment. Thankfully, I don’t give financial advice. Even if I did, I wouldn’t have all the answers. But I just finished reading an excellent book on precisely that topic, so I decided to review it. Read…. Diplomatic Immunity For Your Assets In Interesting Times!

The housing talk is back at work.
Buy now
You’ll be priced out
You’re throwing money away
Bidding wars

Fly Bernanke’s helicopter and play other central bank games
May 29, 2013, 12:36 PM

Can you manage the Federal Reserve better than Ben Bernanke? The Wall Street Journal on Wednesday unveiled the “Federator,” a video game in which you can maneuver Bernanke’s helicopter to maximize employment while minimizing inflation.

Our WSJ colleagues may be surprised to learn — the Federator is not the only central bank-related video game out there. The European Central Bank has long had a game called Economia, which is admittedly a lot less fun, albeit closer to the full governing council experience. You get to set an interest rate and then see how the economy evolves. Remember this is the ECB, though — you don’t have to worry about pesky unemployment! Only inflation, like a good Bundesbanker.

The San Francisco Fed offers a simulation, the Fed chairman game, set in a world where the Fed funds rate is 4.5%, unemployment is 4.75% and inflation is 2.1%. That sounds like something more appropriate for the Kansas City Fed. (Current levels: Fed funds rates: 0.09%; unemployment, 7.5%; inflation, 1%).
…

Pimco’s Gross says ‘Bernanke has a lost a little control’
May 29, 2013, 4:32 PM

Bill Gross, Pimco’s co-chief investment officer, says that we are entering a new phase of the correlation between stocks and bonds as central banks ease up their reign on the global capital markets.

In an interview on CNBC Wednesday, Gross recounted the history of the relationship between the two asset classes: before the global financial crisis, stocks and bonds had a negative correlation — as stock prices rose, bond prices fell — reflecting fairly traditional risk-on, risk-off behavior. Once the financial crisis hit, the correlation dissipated altogether.

The famed bond prognosticator has recently said that the bond bull market is over, though the bear market hasn’t yet begun. That middle ground is currently buoyed by central back monetary easing, though speculation about tapering of Federal Reserve bond purchases has led to a sell-off in benchmark U.S. Treasurys in May.

Going forward, that will leave us with a new, mildly positive correlation between stocks and bonds, said Gross:

If bond prices go down, stock prices should go down as well. That’s simply because the global levered trade is dependent upon a stable Japanese yen and a stable JGB yield and a stable Treasury yield, and once you produce instability, then that leverage starts to unwind, the housing market gets affected, and stocks come down.

In a further shift in bond-equity correlations, the 10-year Treasury 10_YEAR +0.33% yield also crossed the S&P 500 SPX -0.71% dividend yield this week in an intersection widely watched by traders. Read more about how that has shifted the meaning of “hunt for yield”.

Asked about Federal Reserve Chairman Ben Bernanke’s policies as an economic driver, Gross asserted that Bernanke doesn’t necessarily have his hand on the steering wheel, nor did he ever:

I think Bernanke has a lost a little control in terms of the real economy. As a matter of a fact he never had it. And to the extent that low interest rates reduce savings and therefore reduce consumption, to the extent that they reduce the return on investment for corporations, to the extent that they destroy business models and then technically jam up the repo market, you’ve sort of lost control of economic growth going forward.

…

Government Silently Positions for Martial Law as Financial Collapse Arrives in America

Susanne Posel
Occupy Corporatism
Aug 1, 2012

The US government has been scheming on how to provide for continuity of government for many decades now. According to an US veteran informant who claims to be an ex-marine and worked on portions the contingency plans known as Rex 84, civil unrest will come after a financial collapse.

The Readiness Exercise 1984, a.k.a. Rex 84, outlines continuity of government wherein the US Constitution is suspended, martial law is declared and the US military command take over state and local governments in order to ensure stabilization of our nation at any cost. Any American who is deemed a “national security threat” would be detained in an interment or FEMA camp.

The author of Rex 84 was Lieutenant Colonel Oliver North, National Security Council (NSC) White House aids and NSC liaison to FEMA.

Rex 84 is the plan; the triggers are a series of executive orders . It is the continuity of government under specific contingency strategies that are laid out in various operations guide manuals. Operation Garden Plot is a subprogram of Rex 84.

Twice before, Rex 84 was implemented – during the LA riots and on 9/11. In these scenarios, only small portions of the entire set of documents were used. Within the series of contingency plans, implementation of them depends on the severity of the situation.

Some of the plans include internment camps where all or portions of the active or inactive military bases would be transformed into work camps where all considered to be dissonant would be held. The NORTHCOM army manuals clearly state that NATO forces will be used in every phase of the operation.

According to the informant, procedures to move conventional, chemical and nuclear bombs across the nation without detection have been facilitated without notice by the US military.

Back in 1986, during his military service where he was involved with weapons transportation, the informant describes how an unmarked refrigerated trailer driven by a civilian driver was used to transport chemical or conventional weapons to various strategic bases both above and underground.

The informant said he was a specialist in aviation deployed weapons, which made him the perfect candidate to the assignment of weapons transportation.

The refrigerated truck, allocated by the administration department on base, was directed to the commissary, where the unsuspecting driver believed that he was transporting food. The weapon was placed at the head of the trailer, and covered up with either food stores (like cans of soup) or body bags. In the event that the truck is stopped en route, the weapon would be well hidden and go undetected by inspectors on the public highways.

A US Marine Corp bill of lading was the paperwork necessary to move the commercial refrigerated truck through weigh stations on public highways without any question. the informant remembers that there was not one incident where he had to enact any security measures to ensure the delivery was made.

The informant, who was assigned to ride in the cab of the truck with the driver, says that his orders were to make sure the truck arrived at its destination. He was informed by his superiors that if there were problems concerning potential civil unrest, he was to radio into his superiors for aid by either air or ground support.
Should the situation warrant serious attention; crowd control methods would be implemented.

One possible scenario was the use of cluster bomb units (CBUs) that will emit upon detonation, a “sleep and kill” chemical weapon that will not disturb infrastructure, but is lethal to all living things within the effected zone. Santilli describes these particular 3 unit CBUs as shaped like water-heaters with a coned top and plunger-like device. Once deployed in the air, a parachute assists these CBUs to the targeted area. And when detonated, a deadly chemical gas will kill every human and animal in the specified cordoned area.

This is just one example, says Santilli, as to the lengths the US armed forces are trained to make sure continuity of government is preserved.

The informant explained that the use of foreign troops on US soil, as described in Rex 84 and other subsequent manuals, would have a two-fold purpose. Firstly, to provide extra security in designated areas, cities or highways; and secondly, as scapegoats were violent action used against American citizens should the US military be directed to attack civilians.

The refrigerated truck, carrying the chemical or conventional weapon with Santilli riding shotgun travelled to underground bases like the one at Yuma Proving Ground which is a ammunitions testing range for pilots. Nestled underneath the ground is a secret military base.

The informant explains that his knowledge of Rex 84 provides that within the document, one of the scenarios that would cause a complete suspension of the US Constitution, Bill of Rights and implement martial law would be a financial collapse. He says once the collapse occurs, the US government and defense agencies estimate they have a 72 hour window to activate all procedures to ensure continuity of government as well as a lockdown of the general population as civilian unrest, riots and outbreaks of violence are anticipated.

A source in the Deutsche Bank claims that in 2008 our financial and monetary system completely collapsed and since that time the banking cartels have been “propping up the system” to make it appear as if everything was fine. In reality our stock market and monetary systems are fake; meaning that there is nothing holding them in place except the illusion that they have stabilized since the Stock Market Crash nearly 5 years ago.

Since this time, the Department of Homeland Security (DHS) in conjunction with FEMA and other federal agencies have been quickly working to set in place their directives of control under a silent martial law.

The Deutsche Bank informant says that the cause for the bailout of the banks was a large sum of cash needed quickly to repay China who had purchased large quantities of mortgage-backed securities that went belly-up when the global scam was realized. When China realized that they had been duped into buying worthless securitized loans which would never be repaid, they demanded the actual property instead. The Chinese were prepared to send their “people” to American shores to seize property as allocated to them through the securitized loan contracts.

To stave this off, the American taxpayers were coerced by former President Bush and former US Treasury Secretary Hank Paulson. During that incident, the US Senate was told emphatically that they had to approve a $700 million bailout or else martial law would be implemented immediately. That money was funneled through the Federal Reserve Bank and wired to China, as well as other countries that were demanding repayment for the fraudulent securitizations.

To further avert financial catastrophe, as well as more debt or property seizure threats by the Chinese, the Euro was imploded there by plunging most of the European countries into an insurmountable free-fall for which they were never intended to recover.

All the money that those banks claimed they needed to avert collapse was also sent to the Chinese to add to the trillions of dollars lost during the burst of the housing bubble on the global market.

The only saving grace has been the US dollar being the global reserve currency. However, now this prop is showing signs of wear as foreign nations like China, Russia, India and Iran are dealing in gold as currency and purchasing gold on the market at an exponential rate.

In 1970, Henry Kissinger made a deal with the Saudi Arabian government that American debt would be purchased in exchange for cheap oil. Since then Iran has taken control over the Organization of the Petroleum Exporting Countries (OPEC) by their use of gold as currency which has threatened the direct value of the US dollar as the global reserve currency.

This scenario with Iran coupled with the massive leaps forward in US military presence on American streets and the emergence of FEMA camps across the nation pose an obvious turn of events and explains exactly why we are witnessing the silent implementation of martial law.

The war with Iran has to do with gold, its use as currency and its exposure of the central banking cartel’s lack of gold which defines a fiat currency’s worth. And right now, the US dollar is absolutely worthless.

The Deutsche Bank informant says that the financial collapse that happened in 2008 will be realized here in America very soon. Once that happens, there must be full implementation of marital law to control the potential riots and control over citizens that will be desperate to feed their families.

The attacks of recent on the 2nd Amendment play a significant role in attempting “amicably” to remove the possibility of civilian retaliation against the US military’s presence throughout the nation. However, if they cannot remove the guns from our hands in time, they will continue on with the guidelines set out in Rex 84 with directives to kill any dissenters that refuse to obey.

http://www.occupycorporatism.com/government-silently-positions-for-martial-law-as-financial-collapse-arrives-in-america/ - 66k -