Category Archives: Finance

Bernanke and Paulson Pressured BOA-Merrill Merger

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More evidence of behind-the-scenes string-pulling in the banking crisis:

NEW YORK (Reuters) –

Bank of America Corp CEO Kenneth Lewis testified under oath that Federal Reserve Chairman Ben Bernanke and then-Treasury Secretary Henry Paulson pressured him to keep quiet about losses at Merrill Lynch & Co, which the bank was buying, the Wall Street Journal reported.

Testifying before New York Attorney General Andrew Cuomo in February, Lewis said “it wasn’t up to me” to reveal Merrill’s fourth-quarter losses as they were becoming apparent in December, the newspaper said, citing a deposition transcript.

Shareholders of Merrill and Bank of America voted to approve the merger on December 5, and the transaction closed on January 1. Bank of America subsequently reported that Merrill lost $15.84 billion in the fourth quarter.

At Bank of America’s April 29 annual meeting, shareholders will vote on whether to force Lewis to step down as chairman of the largest U.S. bank or leave its board, because of Merrill and a falling share price…”

Read more at Reuters

My Comment

Why do people think nationalization will improve matters?

We’ve nationalized already…. unofficially.

Making it official won’t improve anything. It will just get people to accept what’s going on and legitimize the swindle.

We’re like bystanders at a mugging fighting over who ought to get the money the mugger left behind when he fled.

No. See mugging, call cops.

That’s how it’s supposed to go.

IMF: G-20 Fiscal Stimulus On Target

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In the news:

The IMF says the G-20 fiscal stimulus will reach its 2% target.

Bloomberg reports on the figures spent so far:

“The G-20 countries will spend $820 billion on stimulus measures in 2009, up from a March estimate of $780 billion, and will spend $660 billion in 2010, the fund estimated.

The IMF also revised its forecast for budget deficits in G- 20 countries as a result of fiscal expansion. Today’s report calculates that budget deficits in the G-20 this year will increase by 5.5 percentage points of gross domestic product relative to 2007 and 5.4 percent in 2010. In March, the fund forecast a 4.7 percentage-point rise this year and a 5.1 percentage-point jump next year.

Strauss-Kahn said yesterday that governments should start to discuss “exit strategies” from the emergency spending once the crisis passes.

The fund’s estimate for financial-sector support also increased today to 32.1 percent of GDP, up more than 3 percentage points from the March estimate….”

My Comment (check back for more):

Domininique Strauss-Kahn, a member of the Socialist party and a former finance and economy minister in  Lionel Jospin‘s “Plural Left” government became the new managing director of the International Monetary Fund on September 2007, replacing Spain’s Rodrigo de Rato.

Interesting things to note about Strauss-Kahn:

  1. He’s part of the European Council on Foreign Relations, launched in October 2007 (i.e. just after DSK became IMF chief), which in an expression of pan-Europeanism in world affairs. Rubbing shoulders with DSK, according to Source Watch are such notable globalists as George Soros (Chairman of the Open Institute), Stephen Wall (Chairman of the influential PR firm Hill & Knowlton, advisor to Tony Blair), and Timothy Garton Ash (whose influential book, The Magic Lantern, cheered on the 1989 revolutions in Eastern Europe). Note: Hill & Knowlton was the outfit that concocted the story about Iraqi soldiers killing babies that became a provocation for the 1991 Gulf War.
  2. Strauss-Kahn has been linked to the financial scandal around ELF Aquitaine, a state-owned oil giant through which former President Francois Mitterand allegedly channeled money to Germany’s Christian Democrats. Strauss-Kahn’s wrong-doing was apparently less serious than some of the fraud and corruption with which other French government officials and company heads were charged (including money-laundering, influence peddling, falsification of documents, and bribery)
  3. Money from the ELF oil company, as well as from the Taiwan frigates scandal, passed through “unpublished accounts” at  Clearstream Banking, the clearing division of Deutsche Bourse, based in Luxembourg. The ELF affair and the Taiwan frigates scandal were the two major financial scandals that hit France in the 1990s. And in both, Clearstream was a platform for money-laundering and tax evasion.

Will Grigg On Tax Eaters and Tax Victims

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“There are no “Blue” states, only blue cities. The rural and much of the suburban population in both “Blue” and “Red” states consists of net payers of taxes; what Steven Malanga of the Manhattan Institute properly calls the “tax eater sector” is overwhelmingly an urban phenomenon (and former “community organizer” Barack Obama is a pure product of the urban tax parasite constituency Malanga describes).What this means, of course, is that the schism between urban tax-eaters and rural/suburban tax victims will grow steadily wider until something – either the present political/economic system, or the people ruled by it – collapses altogether.

With the government now little more than a full-service plundering arm of Wall Street, now is the best time for states to withdraw from the corporatist unitary state and repudiate its system of taxation, fiat money, inflation, and debt.

Unfortunately, if there is one thing that both Red State national socialists and Blue State socialist nationalists enjoy more than hating and baiting each other, it’s nurturing the prospect of ruling the other side – and this simply can’t be done if the “other side” if permitted the option of exercising the right to peaceful secession.

So the exercise in mutual self-oppression continues, and the “New Unhappy Lords” ruling from behind the scenes continue to make us poorer and less free….”

Will Grigg, at Lew Rockwell

Mankiw’s Negative Fed Rate Proposal

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This excerpt from a column on April 18 by Greg Mankiw (“It May be Time for the Fed to Go Negative,” New York Times)  has been raising howls in the blogosphere:

“At one of my recent Harvard seminars, a graduate student proposed a clever scheme to [make holding money less attractive].

Imagine that the Fed were to announce that, a year from today, it would pick a digit from zero to 9 out of a hat. All currency with a serial number ending in that digit would no longer be legal tender. Suddenly, the expected return to holding currency would become negative 10 percent.

That move would free the Fed to cut interest rates below zero. People would be delighted to lend money at negative 3 percent, since losing 3 percent is better than losing 10.

Of course, some people might decide that at those rates, they would rather spend the money — for example, by buying a new car. But because expanding aggregate demand is precisely the goal of the interest rate cut, such an incentive isn’t a flaw — it’s a benefit….”

My Comment

I didn’t see this until today because I haven’t followed the economics blogosphere very closely recently. Post-TARP, it’s been awash with all sorts of schemes and proposals built on very flimsy foundations.

The numero uno objection to all of them is the notion that the economy is something that can be manipulated like a board game. It’s not.

Objection two is also obvious and also foundational.  Any grand scheme based on taking illegally from someone what they’ve earned honestly (and I think it’s safe to say at least a few people here and there have earned their livings honestly) is morally wrong. What’s morally wrong on an individual level cannot be morally right on a grand scale, even if we allow for all sorts of prudential calculations, reservations about “the public good” and so on.

Objection three is that a crisis caused by excessive borrowing and spending is not plausibly solved by more spending and borrowing.

Objection four is  that degrees in economics do not give you an understanding of how proposals might actually work in the real world. That takes common sense and some experience of how human beings actually function and build businesses.

Objection five is that theories are only very nebulous and hazy road maps with no correspondence to the actual terrain underneath.  A theory which has never been tried before, let alone produced the results touted, is a very flimsy guide to follow.

Mish Shedlock takes on Mankiw here in more detail but quite unnecessarily, since the proposal is on its face absurd and impracticable.

You can see, however, that on this, the New York Times (ostensibly more left-ish) and the Washington Post (ostensibly more centrist) are both singing from the same page.

In my previous blog post, “Bernays and Citizen Parrot” I cited a Wash Po article, “When You’re Flush But Acting Flat Broke,” by Michael Rosenwald (April 16) that referenced the work of Robert Cialdini, a scholar of marketing.  The Post piece was slanted to getting the consumer to go out and spend.

So, keep that in your mind. The two things the establishment wants right now are:

(1) Increased consumer spending

(2) Nationalization of banks

More spending means what? Putting your money (one of the few forms of control you exert over your circumstances) into someone else’s pocket. (I’m not opposed to this if you’ve got plenty saved, are getting a good deal and need what it is you’re buying, but that’s not the kind of savvy spending the powers that be are looking for).

Nationalization means what? Allowing the government to control the people in charge of lending you money…who are also the people holding your savings….who are also the people mainly responsible for getting us into this mess.

Forget all the deep explanations, economics theories, and punditry.

Just focus on those two things. Do they make sense to you right now, right here?

No? I thought not…..

Bob Zoellick’s A Two-Bit Bore

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A piece I wrote on Zoellick at MWC News :

April 2, 2009

Bob Zoellick is really, really sorry for poor people in Asia, who are really, really going to be hurt the most by a slow-down in global trade.

That’s what he told a Thomson Reuters Newsmaker ahead of the G20 meeting in London on April 1.  According to Bobby Z, the global economy is going to contract by 1.7 percent this year, compared to growing by 1.9 percent last year.

He didn’t define growth.

He’s not suggesting that a decline in the velocity of derivative hot-potato is a decline in growth, is he? I hope not.

But he did define poverty.  A buck twenty-five a day, he says.

Well, here’s what. A buck twenty-five in India is about sixty rupees. Which will buy you enough to eat for a day in India. Which is all that matters to a poor Indian.

That makes a poor Indian better off than a derivative big-shot in Manhattan, at the end of the day. He won’t be broke….. with other people’ money.  Or, in the red…. up to infinity.

And that’s where you, me, and Bobby Z are now, after several trillion bucks.

I’ll take a buck-fifty in an Indian village, any day.

Maybe we need a new definition of poverty. Or, we need a new president of the World Bank.

Not yet another axe-man from the Sachs men.

Especially one who’s gone in and out of Treasury, the Department of State, and practically every US trade delegation in the last twenty years like a cheap suit through a Chinese laundromat and was –  get this – an executive vice-president at none other than Fannie Mae.

That would be just around the time (1993-1997) they were shoving every one with a pulse (and many without) into subsidized housing.

Who else would we want cleaning up the nuclear fall-out from the housing bubble, if not one of the leading bubble-heads around, right?

Besides advising Enron on finance and screaming for war in Iraq, I don’t know if you could come up with a more radioactive resume than that.

Oh, that’s right, Zoellick’s got those two wrapped up, as well.

(Wiki: Zoellick signed the January 26, 1998 letter to President Bill Clinton from PNAC that advocated war against Iraq. During 1999, Zoellick served on a panel that offered Enron executives briefings on economic and political issues.)

What a busy fellow. Quite the boy wonder.

And oh – look. He’s into fancy innovations too.  He’s the guy who’s been shoving genetically-modified food down European gullets, like it or not.

(The”Big Five” biotech companies–Monsanto, Dupont, Syngenta, Dow Chemical, and Aventis–control 937 out of 1085 biotech patents).

And he’s shown he can shove it down Asian gullets too.

He’ll do anything to get rid of poverty, will our Bobby, even if it means getting rid of the poor. From high-tech food to high-tech finance, Zoellick’s a big believer in force-feeding.

Now he wants the G-20 to endorse a new $50 billion Global Trade Liquidity Programme (translated from the Higher Financialeze that reads Got To Love These Pigs), which combines a billion from the World Bank with “financing from governments and regional development banks,” which gets “leveraged by a risk-sharing arrangement with major private sector partners.”

We hate to bring cold logic into such a touchy-feely, lovey-dovey arrangement, but does “risk-sharing” mean the private-sector partners could go broke too?

Or, at least, get a fatal SIV? Because that’s what sharing risk usually means. (Maybe we need a needle-exchange program for credit-heads, but that’s another story).

And all of this risk-sharing is just to help the poor in Asia out? It brings a tear to our cynical eye, Bobby.

Such sharing. Why, it’s chummier than anything since David and Jonathan, this private-public partnership.

Oh, that’s right. Tim Geithner came up with that brainwave recently too. (I guess that’s what being a Goldman alum does for you. It gives you the same sort of brainwaves).

And who would they be, these generous Fezziwigs of Finance, these Monetary Mother Theresas?

Standard Chartered, Standard Bank, and Rabobank, we hear. Rabobank? We feel a brainwave coming on ourselves. Wasn’t Rabobank one of AIG’s needle sharers…er…counterparties?

And doesn’t that mean that, one way or other, the Fed has already done one of their hot little private-public lapdances with Rabobank?

I mean, how many private-public partnerships do you get to go through before people start calling you.. you know….a two-bit bore..

In Advance of Tax Day

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 From Jake Towne:

Facts about the Federal Income Tax synthesized for an April 15th handout, available by email. Join your local Tea Party and Tax Day Coalition on April 15th!!

“In a Time of Universal Deceit, Telling the Truth is a Revolutionary Act.” – George Orwell, author of 1984

1) The premise behind collecting the federal income tax is a complete farce. The IRS claims the tax is voluntary, whereas any sane American realizes that she or he will go to jail if the tax is not paid. This is evident from not only the legal code, but even from the latest 1040 instructions to the taxpayer!  (1A) (1B) (2) (3)

IRS Commissioner Douglas Shulman writes that the American taxpayer willing pays income tax “of their own free will” but laments “unfortunately, there will always be some that cheat their fellow citizens by avoiding the payment of their fair share of taxes.” Shulman then infers that IRS enforcement will be “prompt” and “strong” (read: ‘swift’ and ‘merciless’) for this voluntary tax. (4)

The Treasury calls it “our voluntary tax system.” The IRS claims it pursues “enforcement programs to promote voluntary compliance” and establishes “strategies to maximize voluntary tax law compliance by emphasizing customer satisfaction.” (5)

2) The federal income tax was originally a Marxist idea. Karl Marx wrote the 10 Planks of a Communist State in his Communist Manifesto. The second plank, right after the abolition of private property was “a heavy progressive or graduated income tax.” (6)  In 1909, this Marxist idea was politically accepted by Americans as retribution against the “evil capitalists” who had caused the Panic of 1907. 100 years later, both political parties now scapegoat all those in the financial industry as “evil doers.” (7)  By claiming an ever-increasing amount of your income, the State literally owns your labor.

3) The federal income tax is unconstitutional. The 16th “Income Tax” Amendment of 1913 was likely never officially ratified, and even if it was, in 1916 the Supreme Court ruled “the Sixteenth Amendment does not purport to confer power to levy income taxes” in Brushaber vs. Union Pacific Railroad. (8, 9, 10, 11)  The income tax was first placed into circulation as a 1-7% tax on only the very richest Americans.  This top tax bracket grew to an onerous 92% in the 1950s.  While this receded, for the middle class this tax has grown 500% to 1000% from this time period. (12)

4) The income tax is mostly used for War-Making, the Welfare State, and the National Debt – not general government and law enforcement! The income tax amounted to $1.2 Trillion for 2008. (13)  Outlays were for $2.9 Trillion plus the $0.8 Trillion October bailout.  (14)  We spent just $0.067 Trillion for general government and law enforcement!  (15) Out of every tax dollar, the IRS estimates we spend about a quarter on defense, a dime on the national debt, two pennies on general government & law enforcement and the remainder on Social Security (a giant Ponzi scheme) and other welfare and social programs. (16, graph)

5) The $1.2 Trillion federal income tax is unnecessary. Cutting our overseas military empire spending of $1 Trillion per year would justify its elimination. (17)  Instead of bailing out the banks for $0.8 Trillion in October and $1.1 Trillion of the Obama stimulus plan, we could have bailed out the increasingly unemployed taxpayer for at least the 2008 tax bill as I argued in January. (18)

6) The federal income tax code is time-consuming, confusing and baffling for many Americans. No wonder – the code itself now consists of 3.4 million words and if printed would fill 7,500 pages. (1B)  The code and regulations together were 66,498 pages long in 2006. (19)  The taxpayer’s 1040 instructions are 161 pages long.  (4) Americans spent 6.4 Billion hours filing their taxes in 2006.  (19)

7) America’s “Tax Army” employs more people (1.2 million) than we have armed forces stationed in the United States (0.9 million). (20, 21) Collecting taxes is a completely non-value added task, adding nothing to our economy. Some of our brightest minds – lawyers, accountants, and computer experts – pound away at keyboards trying to figure out either how to plunder more money from others or find loops in the tax code to “save costs” for their clients. The total cost of collecting taxes is estimated at $63 billion, ironically just $4 Billion short of funding general government and law enforcement! (22) (15) The IRS employs 91,000 and will spend $11.6 Billion in 2009 collecting taxes. (23) (24)

Patriots willing to exercise their natural right to peacefully assemble at your closest local protest site (or just start a protest yourself) are encouraged to enlist with both the Tax Day Coalition (TaxDayCoalition.com) and Tax Day Tea Party (TaxDayTeaParty.com) as I have for events on both on and after April 15. If you would like to join me at a very peaceful protest in east-central Pennsylvania on 4/15, please email me or leave a comment below. [For any government officials reading this, I have paid my taxes every year because I do not want to be imprisoned at the moment, and the collective “you” has failed to intimidate or scare me.]
________________________________________________________________________

List of Sources

(1A) The IRS Tax Code. The IRS strangely recommends visiting Cornell University to view the code and they are correct, it’s easier to view.  http://www.irs.gov/taxpros/article/0,,id=98137,00.html#irc

(1B) The IRS Tax Code.  Easier to search than the IRS or Cornell version. http://www.fourmilab.ch/uscode/26usc/

(2) The Great IRS Hoax, Chapter 5.   http://famguardian.org/Publications/GreatIRSHoax/GreatIRSHoax.htm

(3) America: Freedom to Fascism.  Recommended free movie.  http://freedocumentaries.com/film.php?id=199

(4)  IRS 1040 instructions p2/161,  http://www.irs.gov/pub/irs-pdf/i1040.pdf

(5) Edwards, Chris.  2003. “10 Outrageous Facts About the IRS.” Fact #7. http://www.cato.org/pub_display.php?pub_id=3063

(6)  Marx, Karl. 1848. “Manifesto of the Communist Party” p. 21/44.  http://www.marxists.org/archive/marx/works/download/manifest.pdf

(7)  Armstrong, Martin.  2008.  It’s Just Time.  p. 12/77. Contemporary visit and extension of Kondratrieff cycles.  http://www.contrahour.com/ItsJustTimeMartinArmstrong.pdf

(8) The Constitution of the United States of America.  http://www.usconstitution.net/const.html

(9) Benson, Bill. “The Law That Never Was.” http://www.thelawthatneverwas.com

(10) Tax Facts, #1 through #19.  http://www.voluntarytax.info/tax_facts1.htm

(11) Brushaber vs. Union Pacific Railroad. US Supreme Court, 1916. http://supreme.justia.com/us/240/1/case.html

(12) Quinn, James.  2009. “GRAND ILLUSION – THE FEDERAL RESERVE“ http://www.nolanchart.com/article6123.html

(13) White House. FY 2009 Budget. p. 35/342. http://www.whitehouse.gov/omb/budget/fy2009/pdf/hist.pdf

(14)  White House. FY 2009 Budget. p. 26/342. http://www.whitehouse.gov/omb/budget/fy2009/pdf/hist.pdf

(15) White House. FY 2009 Budget. p. 59/342. http://www.whitehouse.gov/omb/budget/fy2009/pdf/hist.pdf

(16)  IRS 1040 instructions p91/161,  http://www.irs.gov/pub/irs-pdf/i1040.pdf

(17)  Paul, Ron. March 2008.  “Intervening Our Way to Economic Ruin.”

http://www.antiwar.com/paul/?articleid=12519

(18)  Towne, Jake. January 2009. “Why Obama’s Stimulus Plan Will Fail… and a Better Alternative.” Idea #1.    http://www.campaignforliberty.com/article.php?view=3

(19)  Edwards, Chris.  2007. Testimony to House Budget Committee. p. 4/6 http://budget.house.gov/hearings/2007/02.16edwardstestimony.pdf

(20)  Edwards, Chris.  2003. “10 Outrageous Facts About the IRS.” Fact #2. http://www.cato.org/pub_display.php?pub_id=3063

(21)  Towne, Jake. April 2009. “America’s Military Empire.” http://www.nolanchart.com/article6271.html

(22)  Angier, Chuck.  2008.  “Why a Fair Tax Won’t Happen.”  http://www.nolanchart.com/article2776.html

(23) Internal Revenue Service, Data Book. 2008. p. 72/81.  http://www.irs.gov/pub/irs-soi/08databk.pdf

(24)  Internal Revenue Service, Budget-in-Brief.  FY 2009. p. 2/14.

My Comment:

From deep love for the Federal  Government and with thanks for the care with which it’s consulted each and everyone of us before spending our money maiming and massacring civilians in countries we’ve never visited and don’t plan to and bailing out billionaires who don’t even live here,  I devote the whole of today and tomorrow to my favorite task of chasing paper and instructing the IRS in elementary math.

Psy-Op Central: Financial War Games In DC

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In the news today, via Politico, this:

 “The Pentagon sponsored a first-of-its-kind war game last month focused not on bullets and bombs — but on how hostile nations might seek to cripple the U.S. economy, a scenario made all the more real by the global financial crisis.

The two-day event near Ft. Meade, Maryland, had all the earmarks of a regular war game. Participants sat along a V-shaped set of desks beneath an enormous wall of video monitors displaying economic data, according to the accounts of three participants.

“It felt a little bit like Dr. Strangelove,” one person who was at the previously undisclosed exercise told POLITICO.

But instead of military brass plotting America’s defense, it was hedge-fund managers, professors and executives from at least one investment bank, UBS – all invited by the Pentagon to play out global scenarios that could shift the balance of power between the world’s leading economies….”

Thanks to the excellent Justin Raimondo, one of the real heavy-weights of  anti-spin commentary, for the lead.

Turning Beach Sand Into Gold – The Goldcor Swindle

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Perhaps the most famous scam of all was Goldcor, which also had links to other crimes – drug-running and penny-stock hustling…in Florida, of all places. Florida was also the center of mortgage-hustling and land speculation, not just recently but historically.

And the Florida crime circuit, like Madoff’s, had its New York outlet.

According to this piece, Fool’s Gold, by Craig Malisow:

“In 1987, Jerold Weinger was the CEO of a Wall Street brokerage firm crushed under an avalanche of coke.

One of the firm’s partners, six brokers and a receptionist were arrested in a massive U.S. Drug Enforcement Administration Wall Street sweep called Operation Closing Bell. A ninth employee was arrested in the firm’s Florida office. Partner Wayne Robbins ultimately pleaded guilty to drug charges, and seven of the eight others either pleaded or were found guilty of possession, distribution or conspiracy to distribute cocaine, according to the DEA’s New York office…..

“The firm had been in trouble even before the 1987 busts, according to a New York Times investigation, which revealed that the U.S. Securities and Exchange Commission charged the firm with stock manipulation once in 1976 and twice in 1981. The firm settled each charge without admitting guilt, but was ultimately suspended from underwriting “over-the-counter” stocks for two and a half years……

The final blow came in 1991, when the National Association of Securities Dealers fined the firm $1.4 million for manipulating stock prices. The firm was booted out of the association, and its top officer, Michael Leeds, was banned from the industry….”

Lila here:

So you see, drug dealing and stock fraud were connected way back in the 1980s. About when Bernie Madoff began running his scam. And apparently, the SEC could and did move against some players successfully. Why not on Madoff then?

Especially when Weinger was no small potato. He was connected to another big-time operator, Joel Nadel.

The Malisow piece describes one of Nadel’s most infamous schemes:

“The SEC had already banned Nadel from the stock market 20 years earlier, but now the commission accused him of accepting bribes to tout worthless penny stocks in his bogus newsletters.

The New York Times, the Boston Globe and several Florida newspapers ran stories on Nadel in the late 1980s and early 1990s, culminating with his participation in the Goldcor scandal.

In Nadel’s newsletters, including one from the fictitious “Royal Society of Liechtenstein,” he praised a company called Goldcor, whose founders said they invented a process to turn a 20-mile strip of black volcanic Costa Rican beach sand into gold.

“The sands that are removed from the beach are replenished by tidal action only after a few days,” wrote Nadel, who was not a partner in Goldcor. The scam was so elaborate that, according to The Washington Post, Goldcor’s principals flew prospective investors to Costa Rica in Learjets so they could visit the company’s laboratories and watch white-coated scientists turn sand into gold.

In April 1991, the government froze $6.6 million of Nadel’s assets; in August, Goldcor President Richard Brown was found in his home with a bullet behind his left ear; in November, a federal judge ordered Goldcor representative Carl Martin to refund $10.8 million to investors. An estimated 3,000 investors lost at least $50 million in the scam.”

The most interesting part of this little history is that the Royal Society of Liechtenstein was sold off, changing its name to the Oxford Club, which has been since then a part of Agora Inc. (Update, April 8, 2010: It merged with a pre-existing newsletter, The Passport Club (according to Agora’s website).

The Brown death was never seriously investigated, say some SEC officials, who believe it was a murder.

What’s even more interesting is that Nadel’s Chief Operating Office, Mark Ford, who was also banned from selling stocks directly as a result of the settlement with the SEC, changed his name to Michael Masterson, and followed the Royal Society of Liechtenstein to Agora Inc., as part of Oxford Club and as a consultant).


How To Become An American Billionaire

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In the news at Yahoo Finance, these are the characteristics of a sample group of billionaires:

*Billionaire Parents Had Math-Related Careers

Math prowess is ofter inherited. Engineer, accountant and small-business owner predominated among the professions followed by those billionaire parents whom the study could track down.

* Billionaires had September Birthdays

Of the 380 self-made American tycoons on Forbes list of the World’s Billionaires over the last three years, the most (42) were born in September.

*Billionaires Dropped Out and Tuned In….To Tech Success

More than 20% of self-made billionaires on the latest list of the World’s Billionaires dropped out and became tech tycoons – including Bill Gates, Steve Jobs, Michael Dell, Larry Ellison, (Oracle) and Theodore Waitt (Gateway).

*Skull and Bones

Many billionaires were members of Skull and Bones, the secret society to which John Kerry and George W. Bush belonged. They include hedge-fund manager Edward Lampert, Blackstone co-founder Steven Schwarzman and FedEx founder Frederick Smith.

*Goldman Sachs

Of 68 self-made American finance billionaires, at least eight come out of Goldman Sachs, especially: its “risk arbitrage” unit where Edward Lampert, Daniel Och, Tom Steyer and Richard Perry started out.

My Comment

This is the kind of news article that deserves deconstructing. Apparently, the way to the greatest wealth in the US is through an early start, a good head for figures, and a network of the most politically well–connected people around, i.e., through insider contacts. If that’s so, it portends ill for real capitalism.

I have no idea what the September birthdays mean….

Pentagon Lifts Media Ban On War Dead

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In the news today:

“DOVER AIR FORCE BASE, Del. – The Pentagon’s 18-year ban on media covering the return of fallen U.S. service members ended with a solemn ceremony for the arrival of a flag-draped casket of an airman felled in Afghanistan.

After receiving permission from family members, the military opened Dover Air Force Base in Delaware to the media Sunday night for the return of the body of Air Force Staff Sgt. Phillip Myers of Hopewell, Va.”

 More here.

My Comment

Very interesting to me that they lift this media ban just now.  After 18 years (since Gulf War I).

Why? Maybe it’s done for the highest motives.

Maybe, just maybe, it’s done to distract from coverage of worker unrest and channel emotions elsewhere.

I’m glad the ban is lifted. But let’s hope the media is savvy enough not to disconnect these two things: the war dead and the working wounded.

It’s the same war. It’s state machinery in the service of a small group of financiers attacking free markets and free society.