Oil Hits $117 A Barrel And China Is Almost #1 World Export Power

April 18, 2008

Elaine Meinel Supkis

Nearly the entire population of the planet earth is flipping out today due to relentlessly rising oil and food prices. But in La-La-Land, the pirates and bankers are dancing with joy. They imagine that the worst is over and not only can they resume their happy activities, making trillions of dollars appear out of thin air again, they can do this with utter impunity since the central banks of the demented G7 nations have given them all a green light! Pour on the liquid red ink! But there is something wrong. China is acting like a dragon. In the news, China is rapidly overtaking the #1 exporting nation on earth and it is NOT the US or Japan, it is GERMANY. Quietly, Germany has outstripped the US as well as former Axis ally, Japan. History loves this story. And look: the price of oil is now running up to $117 a barrel. And the children running Wall Street think this is the END of inflation? The END of the banking collapse? Ask Volker. He knows the truth.

China passes US as second-biggest exporter

Global trade growth is expected to slow to a six-year low of 4.5 per cent this year but China has overtaken the US as the world's second-biggest exporter, the World Trade Organisation (WTO) said yesterday.

Heavily influenced by the turmoil in financial markets and the sharp economic slowdown in leading western economies, global merchandise trade is forecast to rise by 4.5 per cent this year, against last year's 5.5 per cent.
*snip*
In 2007, buoyed by strong performances by dynamic emerging economies such as China. India, Brazil, and Russia, world merchandise trade in value terms increased by 15 per cent to $13.6 trillion (£6.8 trillion).

Emerging countries accounted for more than half of the world's trade growth last year, Mr Low added.

Meanwhile, trade in commercial services, boosted by big increases in transport and travel services, last year increased by 18 per cent to $3.3 trillion, said the WTO.

Another stellar performance by China, which recorded a 26 per cent rise in its merchandise exports to $1.2 trillion, enabled it to surge ahead of the US to be ranked the world's second biggest exporter and is breathing down the neck of top-placed Germany.

OK: this is bad news for us on many, many fronts. First of all: both Germany and China have made themselves better than us not only in the world but DIRECTLY at our own expense. Both have huge trade surpluses with us. Both are building powerhouses at our expense. Neither of these nations are buying lots of high-end value-added stuff from us. We are their feedlot. Both intend to dominate our INDUSTRIAL life. Both have this big thing about controlling the ball-bearing markets. And high-speed trains. Just for example. Worse, both are very chummy. Both want the same things and both are cooperating to get these things.

Worse still, both are triangulating with Russia. China, more than Germany. But Germany is getting nervous about Merkel alienating Russia. The next President of Germany will probably rectify this. They certainly can't let China hog Russia's resources while they get stuck with a dying duck USA market.

As China roars ahead, I must say, we can't push China around if they are #2 in several major ways including #2 on the military front. True, the US spends more than the entire planet on our military. But this is mostly wasted dollars. The thrifty Chinese will get more bang for their bucks. They can do cheap stuff whereas we have to give our dead and dying half a million in order to get anyone to enroll in the military. The imperial waste and thievery is rampant in the US. Indeed, the Chinese know that a few well-placed bullets to the back of well-heeled hack heads is a great cost-cutting tool for the military.

Bernard Arnault offers support to China after threat of LVMH boycott

Bernard Arnault, the chairman of LVMH, the French luxury goods group, distanced himself from the Dalai Lama with a show of support for Beijing yesterday amid growing concern in France over Chinese calls for a boycott of Gallic products.

France’s best-known business leader spoke out with Chinese internet users targeting Paris for criticism following the pro-Tibetan demonstrations that accompanied the Olympic torch relay.

Consumers are being urged to boycott groups such as Carrefour, the supermarket chain, and Mr Arnault’s celebrated LVMH brands, which include Louis Vuitton, Hennessy and Fendi.

With French exports to China worth €9.1 billion (£7.3 billion) last year, officials and industrialists in Paris are keen to smooth over the row.

The Chinese are very riled up. They are angry that the Tibetans rioted and were portrayed as innocents while they rampaged about, murdering innocent Han Chinese. They are very angry that the Europeans and Americans want to rip China apart. Especially the Americans who fought a vicious war 150 years ago in order to force half of the nation to remain part of the USA. The Chinese will now lash out at anyone who wants to play hard ball. I know the leadership. They are trying hard to be 'nice' but won't be nice if anyone tries to push them off a cliff.

The whole world is writhing from global inflation tonight. Food riots will be all the rage soon. Many half-functional 'nations' will be out there with begging bowls, pleading for food. The leaders of these nations will scour the earth for someone, anyone who can save them from financial ruin. And this someone will not by the Dalai Lama. Nor will it be the 'bomb, bomb, bomb Iran' American Presidents. It will be China! And this will cement China's #1 standing with the planet, the parts that we ignore but which China is courting heavily. The US and Europe have been trying hard to peel Africa away from China's embrace. But flooding Africa with excess US dollars that are losing value faster than the River Nile runs North, well...good luck. I don't see anyone being much impressed by this.

Global food crisis looms as Asia's rice bowl empties and world price soars

THE crisis over rice showed no signs of easing yesterday as the price of the world's benchmark jumped 10 per cent in just one week, fanning fears that millions across Asia will struggle to afford their staple food.

In a clear sign of the strain on output after major exporters began to curb exports earlier this year, a tender from the Philippines, the world's top importer, attracted offers to sell only about two-thirds of the half a million tonnes it sought.

In Bangkok, Thai 100 per cent B grade white rice, considered the world's benchmark, hit $950 (£482) per tonne, three times its price at the start of 2007.

Say, instead of giving Israel 50% of our foreign aid, we shuffle more to Africa. From $10 billon a year to $20 billion. This won't pay for any increase in food shipments if the price per ton doubles every three months! Farmers and oil men LOVE inflation. Since they have what people need, they can match the inflation caused by speculators, nature and war. This is profiteering. And since we applaud people getting rich via profiteering, our government does absolutely nothing. The problem with this system is, the cities get hammered and all revolutions begin in the cities, not the countryside. Governments that forget this harsh fact usually end up as historical stories like 'A Tale of Two Cities.'

The Chinese advantage in all this is obvious: Africa will be theirs for the foreseeable future. And probably South America, too. In the case of South America, due not to hunger but to the need to sell food and get real money in return, say, in cash, not IOUs churned out by the Federal Reserve's computer banks.

Oil Rises to Record on Signs Stronger Economy May Boost Demand

Crude oil and gasoline climbed to records in New York as better-than-expected earnings results signaled a strengthening economy that may boost demand.

U.S. stocks rallied, capping the best week since February for the Standard & Poor's 500 Index, following earnings reports from companies such as Google Inc. and Caterpillar Inc. that exceeded analyst estimates. Refineries operated at 81.4 percent of capacity last week, the Energy Department reported.

``The real gloomy scenario has been sort of ameliorated with some of these very positive earnings and the indication that the worst is behind us,'' said John Kilduff, vice president of risk management at MF Global Ltd. in New York. ``There will be an uptick in energy demand with the renewed economic outlook for the second half of the year in particular.''

Crude oil for May delivery rose $1.83, or 1.6 percent, to settle at $116.69 a barrel at 2:46 p.m. on the New York Mercantile Exchange, a record close. Oil touched an all-time high of $116.97 a barrel at 5:01 p.m. in electronic trading. The Nymex posted a high trade of $117 a barrel at 2:47 p.m., and the quote was subsequently withdrawn.

These people are NUTS. So long as food and energy are climbing to the heavens, this is BAD ECONOMIC NEWS. If gold shoots up, this is BAD ECONOMIC NEWS. If wages shoot up, this is good news. But not on modern Wall Street! They want cheap lending, not higher wages. Of course, the entire economic mess is due to dropping wages and worsening employment conditions meeting higher energy and food head on! The more energy rises, the worse it will be and the longer the worse will last! I have lived through SEVERAL huge oil price hikes in my life. Always, food shoots up too! And both hammer me at home until I can't do much of anything except scrabble about to feed the family and go to work. It is NOT a good time. Not at all! And it never ends until inflation ends. This is why, after Volker shot rates to nearly 20%, a long 15 year cycle of relentless oil and food price hikes finally nose dived. And life became much, much easier.

We are NO WHERE NEAR THAT YET. Instead, just like under Nixon or Bush I, they are trying the 'let's drop interest rates really low below the rate of inflation and see if that fixes things!' This was done for Bush II and look at what it spawned: global inflation. The more Japan and the US keep their joint interest rates below the rate of inflation, the more the Fed lends trillions in sub-inflation rate money to the bankers, the more inflation we will have. And inflation is BAD. Bad! VERY bad! And for the goofy guys on Wall Street to imagine the worse is over, it ain't! Not even slightly.

Credit derivatives continue to boom, but the old order is under threat

BANKERS gathering in Vienna this week for the annual bash of the International Swaps and Derivatives Association (ISDA) had some big numbers to celebrate. The overall market for over-the-counter derivatives shot up to $455 trillion at the end of 2007. Some $62 trillion of that were credit-default swaps (CDSs), whose supercharged growth continues in spite of the crunch. But the emphasis this year was as much on playing down dangers as playing up volumes. ISDA was quick to point out that actual credit exposure was a mere 2% of the notional value of all contracts.

This coyness is hardly surprising. Regulators have been fretting since 2005 that the market's infrastructure was not keeping up with its growth. Then, in March, came the sudden implosion of Bear Stearns, a top-ten actor in CDSs, rescued partly because of the fear of chaos if such a large counterparty were to fold. The market's overseers may not agree with Christopher Whalen of Institutional Risk Analytics, a consultancy, when he describes off-exchange derivatives as an “act of Satan”. But they want to see more robustness, especially in credit derivatives, and have hinted that they will impose their own solution if the market does not.

Conceived in the 1990s as a hedging tool, CDSs soon took off as a way to speculate on the likelihood of a firm going bust without having to trade its underlying bonds. For much of this decade, they have been celebrated as a means of spreading risk around the financial system. However, their rampant success led to processing backlogs and errors. Under pressure from the Federal Reserve Bank of New York and others, the industry accelerated trade automation and clarified the rules of engagement (for instance, making sure banks were notified when the firm on the other side of the trade sold its interest to another party).

But problems remain. A rise in late confirmations accompanied the spike in trading last summer, suggesting that the plumbing still lacks scalability (see chart). As of December, 13% of outstanding CDS trades were unconfirmed. Technology vendors say solutions exist, but banks and supervisors have been slow to adopt a standard. “It's like the world is starving and we're just standing here with the rice,” says the chief executive of one derivatives-software firm.

This story from today astonishes me. Far from 'spreading risk' these stupid things have INCREASED risk. This thing has been growing frantically in size. No one wants risk so everyone wants this thing they created out of thin air to fix risk by being larger than all possible risks. This stupid enterprise that can't work is going to the be the biggest riskiest thing on earth in all human history. The longer these crazy people pile all possible risk into this one thing, the worse it will be and they can't see this! Amazing, isn't it? And to think that some computer dudes have a solution? HAHAHA. Computers can run to infinity in no time flat! I remember UNIVAC at the University of Chicago when I was a small child. It was the world's biggest computer and used for making nuclear bombs and looking at the universe. Well, everyone's computer is a univac. And can run to infinity in groups. And this stupidity is bad when it comes to money. The point with money is very simple: the more you have, the more worthless it is. If you create $550 trillion dollars but the earth stays stubbornly the same size as when you created only $5 trillion, then we get INFLATION. It is pretty simple.

We can't get out of our banking crisis until we figure out, the solution is not to run computer programs to various levels of infinity. And not only is the banking crisis not over, by the way, it has barely begun. There has been virtually no 'house cleaning'. Very few bankruptcies. And the fundamentals are bad and getting worse. And the worst of this is the Derivatives Beast. And since the OCC has released more Derivative 666 Beast from Hell data, it pays to visit to see exactly how screwed up our finances are and how hopeless it is to fix it with the present band aids and schemes such as driving the US government deep into debt on wild spending, freebies for taxpayers and printing money nonstop. We will compare charts and statements from the beginning of 2007 and the fourth quarter of 2007:

OCC’s Quarterly Report on Bank Derivatives Activities

Second Quarter 2007

Executive Summary

• U.S. commercial banks generated $6.2 billion in revenues trading cash and derivative instruments in the second quarter of 2007, the second highest total ever, and 30% higher than the second quarter of 2006. Revenues in the second quarter are 12% less than the record level set in the first quarter.

• Net Current Credit Exposure, the net amount owed to banks if all contracts were immediately liquidated, increased $20 billion from the prior quarter to $199 billion.

• The notional amount of derivatives held by U.S. commercial banks increased $7.7 trillion to $152.5 trillion in the second quarter, 5% higher than in the first quarter and 28% higher than a year ago. Bank derivative contracts remain concentrated in interest rate products, which represent 81% of total notionals.

• The notional amount of credit derivatives, the fastest growing product of the global derivatives market, increased 16% from the first quarter to $11.8 trillion. Credit default swaps represent 98% of the total amount of credit derivatives. Credit derivatives contracts are 79% higher than a year ago.

• The largest derivatives dealers continue to strengthen the operational infrastructure for over-the- counter derivatives through a collaborative effort with financial supervisors.

Whew. Back then, the OCC thought this was all good news. What do we see?

$7.7 trillion more in inflation! Look! In this sector, they discovered a machine that could create INFINITE MONEY. And so they merrily did this! And the OCC did nothing to stop this! Nothing at all! And our entire government did nothing! Our bankers were in sexual frenzy of joy over this magical means of instant total wealth that was unimaginable! The fact is, it has to either vanish or it translates into global inflation. And it is doing BOTH since it is obscenely huge. Note how this Derivative Beast had grown 79% in ONE YEAR???? Talk about inflationary! Talk about bizarre, dangerous and obviously utterly hideous and totally whacked. If I were running the OCC that year, I would have been heard running around screaming like a cow whacked on the udder by a horse fly.

Note the last sentence: these clowns inflating global currencies did this while collaborating with financial supervisors! Arrest them all! How insane is that? This infuriates me. I suppose these idiots thought they were strengthening derivatives by making them multiply like irradiated rabbits after a nuclear war. Let's look at the latest OCC report for the fourth quarter of 2007:

OCC’s Quarterly Report on Bank Trading and Derivatives Activities
Fourth Quarter 2007

Executive Summary


• Fourth quarter 2007 trading in cash and derivative instruments resulted in losses of $9.97 billion for U.S. commercial banks, compared to revenues of $2.3 billion in the third quarter of 2007. The loss reflects a continuation and deepening of the turmoil in capital markets that began in the third quarter, particularly for credit instruments.

• For fiscal year 2007, U.S. commercial banks reported trading revenues of $5.5 billion, compared to record revenues of $18.8 billion in 2006. The weaker 2007 revenues resulted from poor trading results in the second half of 2007.

• Net current credit exposure increased 22% to $309 billion from the third quarter, and is 67% higher than at the end of 2006. The rapid increase in credit exposure results from sharply lower interest rates and higher credit spreads, which created a large increase in derivatives receivables.

• The notional value of derivatives held by U.S. commercial banks decreased $8 trillion, or 5 percent, to $164.2 trillion in the fourth quarter. The decline in notional values, while unusual, is not surprising given the current turmoil in global capital markets.

• Derivative contracts remain concentrated in interest rate products, which comprise 79% of total derivative notional value. The notional value of credit derivative contracts increased 3% during the quarter to $14.4 trillion, with 98% of those contracts being credit default swaps.

Market Risk

Banks control market risk in trading operations primarily by establishing limits against potential losses. Value at Risk (VaR) is a statistical measure that banks use to quantify the maximum loss that could occur, over a specified horizon and at a certain confidence level, in normal markets. It is important to emphasize that VaR is not the maximum potential loss; it provides a loss estimate at a specified confidence level. A VaR of $50 million at 99% confidence measured over one trading day, for example, indicates that a trading loss of greater than $50 million in the next day on that portfolio should occur only once in every 100 trading days under normal market conditions. Since VaR does not measure the maximum potential loss, banks stress test their trading portfolios to assess the potential for loss beyond their VaR measure.

Call Report instructions do not require banks to report their VaR measures; however, the large trading banks
disclose their average VaR data in published financial reports. To provide perspective on the market risk of
trading activities, it is useful to compare the VaR numbers over time and to equity capital and net income. As shown in the table below, market risks reported by the three largest trading banks, as measured by VaR, are small as a percentage of their capital and earnings:

To test the effectiveness of their VaR measurement systems, trading institutions track the number of times that daily losses exceed VaR estimates. Under the Market Risk Rule that establishes regulatory capital requirements for U.S. commercial banks with significant trading activities, a bank’s capital requirement for market risk is based on its VaR measured at a 99% confidence level and assuming a 10-day holding period. Banks back-test their VaR measure by comparing the actual daily profit or loss to the VaR measure. The results of the back-test determine the size of the multiplier applied to the VaR measure in the risk-based capital calculation. The multiplier adds a safety factor to the capital requirements. An “exception” occurs when a dealer has a daily loss in excess of its VaR measure. Call Reports do not include a line item for the number of “exceptions.” Some banks, however, make such disclosures in their published financial reports. Because of the unusually high market volatility and large write-downs in CDOs in the third and fourth quarters, as well as poor market liquidity, a number of banks experienced back-test exceptions and therefore an increase in their capital multiplier.

Concentrations in highly rated but illiquid ABS CDOs, as well as non-normal market conditions, caused several large dealer institutions (both bank and non-bank) to incur very significant trading losses in the fourth quarter. Historically, these ABS CDOs had not exhibited significant price variability given their “super senior” position in the capital structure, so measured risk in VaR models was very low. However, rapidly increasing default and loss estimates for subprime mortgages have caused an abrupt and significant reassessment of potential losses in these super senior ABS CDOs. Because VaR models rely on historical price movements and assume normal market conditions, this particular risk measurement tool may not fully capture the effect of severe market dislocations. As such, the OCC advocates the use of complementary risk measurement tools such as stress testing and scenario analysis.

The Value that is at Risk here is the dollar itself: this Derivative Beast is one of many creatures that is working to destroy the dollar as a currency. This OCC report doesn't even begin to try to understand why the Derivatives Market self-destructed. Of course, anyone with a brain who understands charts and graphs can clearly see that the Day of Doom had to come. The rate of increase was just utterly and hopelessly unsustainable.

It could not possibly rise from $168 trillion to $350 trillion in one year. Nor double yet again to $700 trillion or double again to over $1.4 quadrillion and onwards. The days of wine and roses were over. The doubling had to stop. Every system that does this does the same thing. When a galaxy is so compressed that it can fit into a thimble, it explodes. When something reaches a natural limit, it either dies or blows up. Nothing in all creation doubles every year forever, not even the universe itself. So the OCC should have been in hysteria last year before the 'reset' occurred. I believe, from my own analysis, that the 'reset' was triggered by China. China decided to switch gears and move their banking system in a new direction. They decided to kill their own hot stock markets before they ran out of control. They clamped down on speculators. The US, instead of instantly copying China, did the opposite and continues to do the opposite.

The US is encouraging speculators. The US is feeding a trillion dollars into the maws of the very people causing global inflation to turn into hyper inflation. The more the US does this, the worse the hyper inflation. This is so irritating the Chinese, who knows what they will do. They already raised their own banking reserves to 16% and higher. The US has basically lost its own banking reserves. We see from the OCC charts and graphs how things are dropping into the negative. Far from holding bigger and bigger reserves in order to kill inflation, the Fed is dropping rates and letting the banks use the Fed as a reserve so they can make MORE loans and create MORE money out of thin air! This is pure insanity. Let's look at some scary charts:

Third quarter 2007:

Fourth quarter 2007:

This pair of charts are each only four months long, one following the other. The August banking/financial collapse barely began in the first chart. Note how the equity and credit swaps are collapsing. But everything else is still in the green. The vast majority of wealth is created out of thin air via the interest rates sector. Playing these derivative games is very productive if one wants lots of inflation! Especially with the wonderful Japanese carry trade!

But the following quarter, as the Japanese carry trade vanishes thanks to the currency war between China and Japan on the heels of the G7 nations attacking China over currency issues, and look! The interest benefits that produce so much funny money is NEGATIVE. And the foreign exchange is much reduced. Credit collapses to dire levels! And total trading revenues are no longer in the green, they are deep in the red, too. And do we think this is over? HAHAHA. No.

Click on all images to enlarge:

Second quarter 2007:

Fourth quarter 2007:

This pair of charts show the losses in total. Note the fact that the vast majority of the value of the Derivatives Beast is owned by only 5 banks. Look at the numbers on the side! We are talking trillions in dollars! Even with the collapse of the general banking system, the Derivatives Beast's owners go from $155 trillion to $165 trillion in size in FOUR MONTHS.

Here is the list of the investment bank owners of the Derivatives Beast. Note the right hand side of this chart: the total credit exposure to capital ratios:

Let's look at the pirates at J.P. Morgan: they got Bears Stearns wrapped in colorful paper and with a ribbon of $55 billion from the very inflationary Federal Reserve and the US taxpayers! Look at these clown's ratios: FOUR HUNDRED AND NINETEEN TO ONE! Forget that Chinese banking reserves ratio of 16%. This is beyond gigantic. It is as if a thimble were equal to an entire planet! No way! No way in HELL. And they hold derivatives to the tune of $85 trillion! This is pure insanity! There is NO WAY these valuations or things can equal any other things on this planet or the sun or this galaxy. This is out of control numbers. HSBC has a ratio that is even worse: 483:1. Most of the banks below the top five mad banks have ratios between 8-15:1

The top two, Citibank and JP both are more than $100 trillion in size. Now that is utterly unbelievable. And we know that Citibank is pretty much bankrupt at this point. And Citibank's ratios is 223:1. So what is JP Morgan? How about one dead duckie! At least, if the Derivatives Beast chooses to appear in public. And this is what our government doesn't want!

But I assure everyone, if the US irritates China too much, we will discover exactly how big this monster is. And anyone who says we will never see it because China will eat all the dollars we grind out, they are nuts. China has no intention of doing this for us. They are not stupid. Personally, I wish our rulers didn't act like small children. I suspect this is due to being sheltered from reality. I would love to pop them into helmets and shove them into Sadr City for an eduction they will never forget. Or leave them stranded without a cell phone in Gaza. Or perhaps drop them into the garbage dumps of Haiti. Or leave them in Darfur without a gun.

Anything to teach them about reality. Then we can make them figure out how to make the Derivative Beast disappear. I suggest burning the dollars in the furnace like they did in Germany. Or give it away to the people of Zimbabwe. It would be meaningless instantly.

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Comments

[Niels Laughlin]

You should write a book. I'd buy it.

[Royal Dutch]

Game, Set, and Match. The Fourth Crusade in reverse. Going off of these figures, how much cash is there really. Not Credit, Cash.

[Aidan Pryde]

This was the most breathtaking article i have read in a long time..aweseom interpretations and FRIGHTENING numbers..

Thank u for writing about this stuff!

And i second the comment about a book !! Absolutely!

[Royal Dutch]

The credit figure might represent the wealth of the plebians no?

[hans blink]

Hello Maestra, really awesome reading, but I am always confused why did the FTSE stock market rise even though Citi Group had such bad figures?

[blues]

I've been thinking again. Some people are probably NOT going to be happy about what I've come up with this time around. Sorry. First a disclaimer: I basically never made it past the fourth grade, so I'm perhaps biased. I have this neurological issue that made it impossible for me to write things on paper. This situation has improved over the years, and this is why you are hearing from me now. After grade four, my education became a joke. Well I did take university courses, but became disenchanted with that scene. They could not adjust reasonably to my five-word- a-minute typing, and I found them to be somewhere between amusing and boring. I did however, obtain a personal education. Learned things like differential equations by reading out of books. Plus I ran a small corporation, organized small political affinity groups, hung out with artist and musicians, lived with them, etc.

I worked (on and off) maybe 30 years fixing tricky electronic equipment of all kinds. Then I took some university courses in linguistics. Frankly, I became thoroughly disgusted with that field. The theoretical linguistics world is sharply divided into "syntax" and "semantics." Lots of people get out of this field because the "great thinkers" in it have no idea what they are doing. Currently fashionable "generative syntax" is a direct ripoff of a mathematical subject called group theory, which was basically discovered, within the framework of abstract algebra, by French mathematician Évariste Galois, who died in 1832 at the age of 20. Even many celebrity linguists have never even heard of group theory! "Syntax" and "semantics" are nearly dichotomous, yet each virtually demands the existence of the other. One point that I have never heard discussed among the theoretical linguistics establishment is that generative syntax always examines methods for the construction of "all well formed" sentences. But semantics examines what sentences "mean," sometimes utilizing set theory. This ultimately means syntax studies how speech is constructed by speakers, while semantics studies how hearers interpret the meaning of speech they hear. So generally, if you have a speaker-oriented theory, you will be considered a syntactician, but if you have a hearer-oriented theory, you'll be viewed as a semanticist. (This obvious reality seems never to be pointed out among the scholars, though they would undoubtedly come up with some sort of denial of the point.) Finally, this whole field is about a scientific as, say phrenology (the old "psychology" that was based on skull shapes). It all simply does not "work," does not ever achieve closure or even consistency.

So I spent about ten years developing my own theory, which happens to be consistent, and actually works. It has no "syntax" or "semantics"; rather, it depends of systems and subsystems.

There are a few academic fields that produce valid results. Physics, biochemistry, and theater, for example. But far as I can see, the fields of economics, sociology, etc. operate at about the level of phrenology. So we have "educated" a vast crop of "experts" who are simply, totally lacking in the most rudimentary thinking skills. And THIS is at the very root of our present overwhelming crises. When I first started taking employments, some major industries were managed by people who never "went to school." And they were managed with tremendous efficiency. As time has passed, our businesses have been given over exclusively to people who have been intensely "educated"; and our financial situation has become a complete disaster. Something is quite radically amiss about our methods of training people to think effectively. The "critical thinking" movement has become a ruinous scandal.

I have plied the "liberal" blogs for about five years, and have become miserably disillusioned about the pathetic thought processes of their "educated" bloggers. Having spent time on some sixty blogs, Culture of Life News is nearly the only blog that harbors posters who can think effectively. I wish to get going on my linguistics blogs, and forgo trying to explain simple things to people who truly cannot think for themselves.

The first thing that must happen if the USA is to have the slightest chance of climbing out of the hole it has dug itself into, is that somebody must utterly reinvent the concept of education. That project is absolutely CRITICAL! Meanwhile, there are some websites where intelligent discussion is provided:

Cyrano's Journal Blogs
http://www.bestcyrano.org/cjblogs.htm

GlobalResearch.ca
http://globalresearch.ca/

And here is an interesting piece about a current Russian view of the current thinking of Zbigniew Brzezinski:

RPMonitor.ru
BRZEZINSKI DISCOVERED AMERICA
http://rpmonitor.ru/en/en/detail.php?ID=9034

Meanwhile, it might be a fine thing if Elaine could find someone to help put together a book!

[rockpaperscizzors]

"Something is quite radically amiss about our methods of training people to think effectively. The "critical thinking" movement has become a ruinous scandal."

HIT THE NAIL ON THE HEAD. Unfortunately the majority of American drones and their dullard robotic leaders are Pavloved trained. Ring the bell and they salivate. Critical thinking was removed from the educational system sometime during the 70's, after college students organized, demonstrated, rioted and demanded an end to Vietnam, crooked politicians (why else would Nixon scream "I am not a CROOK") and started forming co-ops, communes, and opted out of their parents regimented government controlled society. Critical thinking was part of the College of Liberal Arts and Sciences. I remember as this department was marginalized and finally removed under the guise "operational costs/budget controls." And highschools removed these introductory courses as well. We have two generations of Disney/Viacom Media controlled society of pavlov sheeple.

How else could a war hostage held captive in a Hanoi prison for 5yrs and 2yrs of solitary confinement run for President? Does anyone truly believe that he was not subjected to mind altering techniques and sustained physical abuse? Critical thinkers understand he's damaged goods. And understand that he has been well trained by the puppeteers. The pavloved trained americans; guns, god, and gays, will again vote against their best interests.

[rockpaperscizzors]

Is Hubbard's peak oil a reality? Why else would a billionaire Texas oilman invest in Wind technology?
Billionaire Texas oil man makes big bets on wind
WASHINGTON (Reuters) - Legendary Texas oil man T. Boone Pickens has gone green with a plan to spend $10 billion to build the world's biggest wind farm. But he's not doing it out of generosity - he expects to turn a buck.
http://www.reuters.com/article/domesticNews/idUSN1719800520080418?sp=true

The Mafia didn't get their cut of the action:
Dockers refuse to unload China arms shipment for Zimbabwe
South African dockers are refusing to unload a Chinese cargo ship carrying 77 tonnes of small arms destined for Zimbabwe.

The arms, including three million rounds of ammunition suitable for AK47s and 1,500 rocket-propelled grenades, were ordered by the Zimbabwean military at the time of the March 29 election –
The arms arrived at Durban, South Africa, on Wednesday aboard the Chinese-owned An Yue Jiang and must be taken by road to landlocked Zimbabwe, where the Government has been accused of arming rural militias before a possible run-off vote for the presidency. The opposition Movement for Democratic Change (MDC) has even accused Mr Mugabe's Zanu (PF) of preparing for a "war" against the people...
http://www.timesonline.co.uk/tol/news/world/africa/article3772113.ece

[rockpaperscizzors]

NATO is doing the hard work of maintaining the USA status quo of red ink (100 BILLION more for Bush's folly)and keeping War alive in Afghanistan.

Nato admits (mistakenly) supplying arms and food to Taliban
Nato forces (mistakenly) supplied food, water and arms to Taliban forces in southern Afghanistan, officials today admitted.

Containers destined for local police forces were dropped from a helicopter into a Taliban-controlled area of Zabul province.
...A Nato spokesman said the pallets were carrying rocket propelled grenades, ammunition, water and food.

Afghan politicians have said they do not believe the drop was an accident.
http://www.guardian.co.uk/world/2008/apr/18/nato.afghanistan

[Elaine Meinel Supkis]

HAHAHA. Isn't the CIA funny? We can't have rebels to fight unless we give them arms. And note how, yet again, the US is the providing cover for yet more drug producers? The War on Drugs overtook the Vietnam war as the US poured drugs from Vietnam and Indochina into the US.

Note our very close alliance with Columbia, another source of tons of illegal drugs. And we hate Cuba that has no illegal drugs. US military involvement=tons of illegal drugs pouring out of the exact same spot.

Ain't no coincidence!

Drug money pours into the banking system. They love illegal drugs. Since the 18th century.

China sells arms to everyone just like the US. We poured arms into Israel even as they were brutally bombing civilian populations in Lebanon. Note though, how this is considered evil if China does this but NOT if the US or UK do this.

[Anthony]

It seems, european economy is doing just fine from US slowing economy. China and Russia compensate.

Are the world going around us?

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aDr0SJtVg0ak

European January Exports to U.S. Flat After 2007 Drop

By Fergal O'Brien

Euro-area shipments to the U.S., which dropped in 2007 for the first time in four years, were flat at 15.4 billion euros ($24.6 billion) in the first month of 2008, the European Union's statistics office in Luxembourg said today. Exports to the U.K. rose 5 percent, while sales to Russia and China jumped 25 percent.

[Bear of Little Brain]

blues:
There's no need to reinvent the concept of education. The concept has been around since at least the Ancient Greeks, as you no doubt know. What we have to do is correctly define what we have now as "schooling" and refer to it as such. Then we can begin to discuss "education" (from "e ducere", to lead out, as I recall - very vaguely).
Some time ago I came across the writings of John Taylor Gatto on schooling. One of his shorter essays is here:
http://hometown.aol.com/tma68/7lesson.htm
I think he has a point (well, several).
All the best

[Bear of Little Brain]

rock:
I for one don't believe McCain was subjected to mind-altering techniques or sustained physical abuse, and nor do a lot of other people. Some seem to think that this son-of- Admiral-McCain canary just started singing the moment he was captured and that his two years of being unseen by any other prisoners was not due to "solitary confinement", but privileged treatment. Allegedly.
Not to mention the USS Forrestal incident and that something-five business scandal.
He's damaged goods all right, but not the kind you think.

[Bear of Little Brain]

CIA and drugs? That CIA headed by Bush Snr for a while? Does the Bush ranch have its own airstrip? I hope not, or Mrs. Clinton will be complaining about the unfair competition. But Mena is soooo yesterday, darling.

Yup, the criminals are running the prison sure enough.

[blues]

Bear,

It seems to me that history since the time of the Ancient Greeks has been, well, less than wonderful. I personally do think the entire concept of "education" (it does come from Latin for "to draw out," which is just an odd philosophical notion to me). The first thing I would teach people would be to identify and deeply question every assumption. 99% of things taken as obvious to most people are flat out irrelevant or invalid.

I did happen to meet John Taylor Gatto at a book signing, and got to talk with him for a spell. He is very knowledgeable indeed, and has some some surprisingly unorthodox opinions, to say the least! He is somewhat "conservative," but very concerned about the welfare of nonoverprivileged kids. He says that kids in fancy boarding schools get real education, which differs drastically from the "education" nonoverprivileged kids are subjected to. He strongly advocates home schooling. (I say the whole concept is flawed, but who would we allow to mend it?) He has websites, and one is at:

http://www.johntaylorgatto.com/

[Elaine Meinel Supkis]

Anyone can educate themselves if they want to learn. On the other hand, Life can hammer on some people's heads relentlessly and they learn nothing at all.

There is no such thing as 'learning' except to be informed and to filter out 'propaganda'. This is hard to do since a huge hunk of what is floating about the place is pure propaganda put out to fool people.

Note how I mention 'lying' repeatedly when discussing the economic news, for example This constant lying is malicious and deliberate.

[Gavin Gaskins]

Dear Elaine,

This thought occurred to me. America is becoming more similar to Japan by the day. Both countries provide stewardship for a weak currency that gives rise to inflation. This, along with stagnant wages that persist in both countries, destroys the standard of living for the working class. In the US, much of big business is sheiled from the negative effects because these companies have a global footprint. Earnings are improved through currency gains and cheap labor. In Japan, as you know, exporters benefit by the weak yen through gains in market share. So, both countries demonstrate a lack of concern for their own people while government policies promote the interest of multinationals and exporters. All of this is done in very plain view. When will the American government represent the interests of most Americans- America for Americans?

Thank you,

GMG

[blues]

Bernard Arnault offers support to China after threat of LVMH boycott

((----- Copy & Paste - W/O The Line Breaks -----))

http://business.timesonline.co.uk/tol/business/industry_sectors/consumer_goods/article3767882.ece

----
--
Mr Arnault is in the front line following a widespread but, he says, unfounded rumour on Chinese websites that his group had provided financial support to the Dalai Lama.

With Goldman Sachs predicting that China will become the world's biggest luxury goods market within a decade, alarm bells are ringing at LVMH's head office in Paris.

"I refute categorically the allegations over backing for the Dalai Lama," Mr Arnault said.

He went on: "I understand why the Chinese population could be affected by the attacks against its country.
--
----

So this is how it begins...

[blues]

Messed up the link!

((----- Copy & Paste - W/O The Line Breaks -----))

http://business.timesonline.co.uk/tol/business/industry

_sectors/consumer_goods/article3767882.ece

[Bear of Little Brain]

blues:

Yes, children in private boarding schools do have a very different education from the rest. (Bizarrely, over here these private schools, such as Eton, are called "public schools". More disinformation!) They have small class sizes and, generally, better facilities. They also have a sense of being better in a social sense, and the contacts to prove it. Against that I have to say that I was at college with a young man whose father was some bigwig in a Swiss bank. My friend had been to a minor English public school, and private schools all his life. In spite of his socially-assured manner, in our late-night discussions (in vino veritas!) he would sometimes talk about the pain of being abandoned by his parents - and especially his mother - at the beginning of every term (semester?). That is the ruthless side of that upbringing. Sorting the wheat from the chaff is what empires and ruling classes require. And they do it early in life.
Sorry, rambling again. Must be getting old!
Back to your point: if home-schooling is too idealistic, I have trouble accepting that the current system is good enough. I once came across the idea that if attending school and remaining in the school were not compulsory, then schools would have to make themselves places worth going to and staying in. God knows, I spent most of my school days staring out of windows, mindlessly copying things being written on blackboards, and either being distracted by classmates or distracting them. Not to mention having to write out lines or stand in corners or outside. The actual work done must have occupied about 15% of the time there. Maximum. We had end-of-year exams to decide our fates. This meant some serious cramming the night before. I was never brilliant and never hopeless. I survived; but Gatto's insights are oh, so true.
Somehow, I suspect that computerisation may only have replaced pointless boredom with unending activity-for-its-own-sake. Is daydreaming, musing and contemplation becoming impossible? I hope not.

[Bear of Little Brain]

Tibet:

A little googling on "Tibet, communist revolution, feudalism" throws up plenty of info worth considering:
That Buddhism has a history of violence, in spite of its "gentle" reputation. (Well, it IS a religion, what did you expect?)
That Tibet before the communist overthrow was a very, very, very nasty feudal regime, and of which the Dalai Lama was the head honcho, big cheese, king of the hill.
That the first Dalai Lama was installed with the backing of a Chinese army. How ironic.
That the CIA have long been this DL's handlers.

One of the tenets of Buddhism is reincarnation. Sociologically, this means that you are who you are as punishment/reward for a former life. Hence, your station in life is pre-ordained and immutable. This philosophy is what the DL actually represents, however much spin is put on his "holiness". That may or may not jive with you, but it sure doesn't with me.

Any day now, expect "The Decider", aka "Little Boots", to announce that he is the reincarnation of George III and has become a Buddhist. Well, he's heavily into torture, so he already has much in common with those old Tibetan monks. Little Boots will then appoint his favourite horse to be speaker of the House of Representatives (will anyone notice the difference?). Thinks: who would the horse be a reincarnation of? How do you rate "horseness"? They always seem kind of noble to me. Gulliver thought so too. Becoming delirious. Sorry.

This isn't the Tibet link I wanted, but it'll have to do:
http://www.swans.com/library/art9/mparen01.html

[blues]

I only realized after entering my post that it could be construed as criticizing home schooling. I must be getting old. What I meant to say is that our entire concept of "education" must go. Even Plato and his little friends. I'll tell you a little secret. You know I have been a person with a kind of autism. Well I did drive a school bus for a spell (I even drove a city bus). Every school bus will tell you: In the morning the kids are cool as cucumbers — coming back home from school, they are totally insane and TOTALLY frenzied! Just ask! The schools are killing the kids! All your security is ours.

[Bear of Little Brain]

blues:
When I was quite young (9 or 10), a lot us from the same school travelled by public bus. We were thrown off several times for unruly behaviour (and singing dirty songs that we didn't really understand) and forced to walk the last couple of miles home. No paedophiles then, apparently. ;-)
The next year I was considered old enough to cycle.

On education: the Greeks were really only considering it in relation to young men rather than children, I think. If there was only one thing that I would choose to do, it would be to reduce class sizes to, say, 12 max. Whatever makes life pleasant for the teacher and the pupils. Then I'm back to that earlier idea of non-compulsory attendance, but it needs some additional thought.

Peace, bro'.

[Royal Dutch]

to rock, this is the same boone pickens that had a 500 million dollar oil short that vanished like a fart in the wind (right before tax time!) He is a gobbler that knows how to sniff out a government contract if there ever was one.

[Elaine Meinel Supkis]

I biked to jr high but in high school, I had to get up at 4:30 am to catch the bus. I jumped out of HS fast and went straight to college where I spend most of my time trying to overthrow several different governments in different countries. I do say, the education I got in the streets during all that was worth more than any 'education.'

[Royal Dutch]

You can bet your ass Cuba is in on the drug trade. Who is to say these foreign countries are pissed off that they are holding so much worthless paper? the cash COULD be worth something but who really knows what the ACTUAL gold reserves are? Maybe China is actually the broke one here? Who knows maybe the West and the East are broke?

[EEngineer]

And now for something really different... Goldman is conspicuously absent from that derivatives exposure table. Hmm...