With Madoff’s sentencing comes the relief that the culprit is caught, and those who were duped by him and his henchmen are at least, to some degree, relieved to see some kind of justice. I know that those who suffered thier loss because of him will never have their lives back and with all due respect to the victims of Madoff, there is another side to all of this. Has it not occured to anyone that perhaps Madoff was offered up to the sacrifice? Is it not possible that what Madoof has done is only a small part of a much larger whole and we as a country have yet to feel the effects of the greates ponzi scheme ever perpetrated.

Let’s look at Wikipedia’s definition of a Ponzi Scheme:

“A Ponzi scheme is a fraudulent investment operation that pays returns to separate investors from their own money or money paid by subsequent investors rather than from any actual profit earned. The Ponzi scheme usually offers returns that other investments cannot guarantee in order to entice new investors, in the form of short-term returns that are either abnormally high or unusually consistent. The perpetuation of the returns that a Ponzi scheme advertises and pays requires an ever-increasing flow of money from investors in order to keep the scheme going.

The system is destined to collapse because the earnings, if any, are less than the payments. Usually, the scheme is interrupted by legal authorities before it collapses because a Ponzi scheme is suspected or because the promoter is selling unregistered securities. As more investors become involved, the likelihood of the scheme coming to the attention of authorities increases.”

Could it be that the “bailouts” are a sort of Ponzi Scheme and the investors are destined to lose. Who are the investors. All Americans, everyone of us and our children. We have no idea what the effects of the Bailouts will have until we begin to see the returns and I am convinced of one thing, there will be no return!! We will never see the money our government has freely given to multi-national banks and corporations. Our tax dollars are gone and I guarantee you and I and our children will be paying for this scheme for a long time!

Madoff is nothing compared to the people who have ripped off the coffers of the United States, our money, your money, the money that should have been used for the betterment of our country not to line the pockets of multinationals who have no allegiance to our country. These people only have one allegiance, Profit! Yes Madoff was a distraction, a dumb show for those of us who have not yet realized the greatest ponzi scheme ever perpetrated on a Nation.

I did not make this video, important information please pass along.

By Andrew Malone Last updated at 11:14 PM on 27th March 2009

Death will come soon for Jiang Yong. A corrupt local planning official with a taste for the high life, Yong solicited money from businessmen eager to expand in China’s economic boom.

Showering gifts on his mistress, known as Madam Tang, the unmarried official took more than £1 million in bribes from entrepreneurs wanting permission to build skyscrapers on land which had previously been protected from development.

But Yong, a portly, bespectacled figure, was caught by the Chinese authorities during a purge on corrupt local officials last year.

He confessed and was sentenced to death. China executed 1,715 people last year, so one more death would hardly be remarkable.

But there will be nothing ordinary about Yong’s death by lethal injection. Unless he wins an appeal, he will draw his final breath strapped inside a vehicle that has been specially developed to make executions more cost-effective and efficient.

In chilling echoes of the ‘gas-wagon’ project pioneered by the Nazis to slaughter criminals, the mentally ill and Jews, this former member of the China People’s Party will be handcuffed to a so-called ‘humane’ bed and executed inside a gleaming new, hi-tech, mobile ‘death van.’

After trials of the mobile execution service were launched quietly three years ago - then hushed up to prevent an international row about the abuse of human rights before the Olympics last summer - these vehicles are now being deployed across China.

The number of executions is expected to rise to a staggering 10,000 people this year (not an impossible figure given that at least 68 crimes - including tax evasion and fraud - are punishable by death in China).

Developed by Jinguan Auto, which also makes bullet-proof limousines for the new rich in this vast country of 1.3 billion people, the vans appear unremarkable.

They cost £60,000, can reach top speeds of 80mph and look like a police vehicle on patrol. Inside, however, the ‘death vans’ look more like operating theatres.

Executions are monitored by video to ensure they comply with strict rules, making it possible to describe precisely how Jiang Yong will die. After being sedated at the local prison, he will be loaded into the van and strapped to an electric-powered stretcher.

This then glides automatically towards the centre of the van, where doctors will administer three drugs: sodium thiopental to cause unconsciousness; pancuronium bromide to stop breathing and, finally, potassium chloride to stop the heart.

Death is reputed to be quick and painless - not that there is anyone to testify to this. The idea for such a ‘modern’ scheme is rooted in one of the darkest episodes in human history.

The Nazis used adapted vans as mobile gas chambers from 1940 until the end of World War II. In order to make the best use of time spent transporting criminals and Jewish prisoners, Hitler’s scientists developed the vehicles with a hermetically sealed cabin that was filled with carbon monoxide carried by a tube from the exhaust pipes.
The vans were first tested on child patients in a Polish psychiatric hospital in 1940. The Nazis then developed bigger models to carry up to 50 prisoners. They looked like furniture removal vans. Those to be killed were ordered to hand over their valuables, then stripped and locked inside.

As gas was pumped into the container and the van headed towards graves being dug by other prisoners, the muffled cries of those inside could be heard, along with banging on the side.

With the ‘cargo’ dead, all that remained was for gold fillings to be hacked from the victims’ mouths, before the bodies were tipped into the graves.

Now, six decades later, just like the Nazis, China insists these death vans are ‘progress’.

The vans save money on building execution facilities in prisons or courts. And they mean that prisoners can be executed locally, closer to communities where they broke the law.

‘This deters others from committing crime and has more impact,’ said one official.

Indeed, a spokesman for the makers of the ‘death vans’ openly touted for trade this week, saying they are the perfect way to ‘efficiently and cleanly’ dispatch convicts with lethal injections. Reporting steady sales throughout China, a spokesman for Jinguan Auto - which is situated in a green valley an hour’s drive from Chongqing in south-western China - said the firm was bucking the economic trend and had sold ten more vans recently.

The exact number in operation is a state secret. But it is known that Yunnan province alone has 18 mobile units, while dozens of others are patrolling in five other sprawling provinces. Each van is the size of a specially refitted 17-seater minibus.

‘We have not sold our execution cars to foreign countries yet,’ beamed a proud spokesman. But if they need one, they could contact our company directly.’

Officials say the vehicles are a ‘civilised alternative’ to the traditional single shot to the head (used in 60 per cent of Chinese executions), ending the life of the condemned quickly, clinically and safely - proving that China ‘promotes human rights now,’ says Kang Zhongwen, designer of the ‘death van’.

It seems a perverse claim, but certainly the shootings can be gruesome. Once carried out in public parks, these executions -sometimes done in groups - have seen countless cases of prisoners failing to die instantly and writhing in agony on the ground before being finished off.

There are other concerns: soldiers carrying out the shooting complain that they are splashed with Aids-contaminated blood. After the shooting, relatives are often presented with the bullet hacked from the condemned’s body - and forced to pay the price of the ammunition.

While posing as a modernising force in public, Chinese leaders remain brutal within their own borders. They are, however, anxious to be seen to be moving away from violence against their own people, stressing that all judicial decisions have been taken out of the hands of vengeful local officials and must be ruled on from Beijing.

China has traditionally always taken a ruthless, unemotional view of crime and punishment. Before injections and bullets, the most chilling sentence was death by Ling Chi - death by a thousand cuts - which was abolished only in 1905.

The condemned man was strapped to a table and then, in what was also known as ’slow slicing’, his eyes were gouged out.

This was designed to heighten the terror of not being able to see what part of his body would suffer next. Using a sharp knife, the executioner sliced at the condemned’s body - chopping off the ears, fingers, nose and toes, before starting to cut off whole limbs.

Traditionalists insisted that exactly 3,600 slices were made. The new mobile execution vans may, indeed, be more humane than this, but their main advantage in official eyes is financial.

According to undercover investigations by human rights’ groups, the police, judiciary and doctors are all involved in making millions from China’s huge trade in human body parts.

Inside each ‘death van’ there is a dedicated team of doctors to ‘harvest’ the organs of the deceased. The injections leave the body intact and in pristine condition for such lucrative work.

After checking that the victim is dead, the medical team first remove the eyes. Then, wearing surgical gowns and masks, they remove the kidney, liver, pancreas and lungs.

Little goes to waste, though the heart cannot be used, having been poisoned by the drugs.

The organs are dispatched in ice boxes to hospitals in the sprawling cities of Beijing, Shanghai and Guangzhou, which have developed another specialist trade: selling the harvested organs.

At clinics all over China, these organs are transplanted into the ailing bodies of the wealthy - and thousands more who come as ‘organ tourists’ from neighbouring countries such as Japan, South Korea, Singapore and Taiwan.

Chinese hospitals perform up to 20,000 organ transplants each year. A kidney transplant in China costs £5,000, but can rise to £30,000 if the patient is willing to pay more to obtain an organ quickly.

With more than 10,000 kidney transplants carried out each year, fewer than 300 come from voluntary donations. The British Transplantation Society and Amnesty International have condemned China for harvesting prisoners’ organs.

Laws introduced in 2006 make it an offence to remove the organs of people against their will, and banned those under 18 from selling their organs.

But, tellingly, the law does not cover prisoners.

‘Organs can be extracted in a speedier and more effective way using these vans than if the prisoner is shot,’ says Amnesty International.

‘We have gathered strong evidence suggesting the involvement of Chinese police, courts and hospitals in the organ trade.’
The bodies cannot be examined. Corpses are driven to a crematorium and burned before independent witnesses can view them.

A police official, who operates a ‘multi-functional and nationwide, first-class, fixed execution ground’ where prisoners are shot, confirmed to the Mail that it is always a race against time to save the organs of the executed - and that mobile death vans are better equipped for the job.

‘The liver loses its function only five minutes after the human cardiac arrest,’ the officer told our researcher.

‘The kidney will become dysfunctional 30 minutes after cardiac arrest. So the removal of organs must be completed at the execution ground within 15 minutes, then put in an ice box or preservation solution.’

While other countries worry about the morality of the death penalty, China has no such qualms.

For the Beijing regime, it is not a question of whether they should execute offenders, but how to do it most efficiently - and make the most money from it.

Saturday 28 March 2009

Washington - Canadian researchers have uncovered a vast electronic spying operation that infiltrated computers and stole documents from government and private offices around the world, including those of the Dalai Lama, The New York Times reported on Saturday.

In a report provided to the newspaper, a team from the Munk Center for International Studies in Toronto said at least 1,295 computers in 103 countries had been breached in less than two years by the spy system, which it dubbed GhostNet.

Embassies, foreign ministries, government offices and the Dalai Lama’s Tibetan exile centers in India, Brussels, London and New York were among those infiltrated, said the researchers, who have detected computer espionage in the past.

They found no evidence U.S. government offices were breached.

The researchers concluded that computers based almost exclusively in China were responsible for the intrusions, although they stopped short of saying the Chinese government was involved in the system, which they described as still active.

“We’re a bit more careful about it, knowing the nuance of what happens in the subterranean realms,” said Ronald Deibert, a member of the Munk research group, based at the University of Toronto.

“This could well be the CIA or the Russians. It’s a murky realm that we’re lifting the lid on.”

A spokesman for the Chinese Consulate in New York dismissed the idea China was involved. “These are old stories and they are nonsense,” the spokesman, Wenqi Gao, told the Times. “The Chinese government is opposed to and strictly forbids any cybercrime.”

The Toronto researchers began their sleuthing after a request from the office of the Dalai Lama, the exiled Tibetan spiritual leader, to examine its computers for signs of malicious software, or malware.

The network they found possessed remarkable “Big Brother-style” capabilities, allowing it, among other things, to turn on the camera and audio-recording functions of infected computers for potential in-room monitoring, the report said.

The system was focused on the governments of South Asian and Southeast Asian nations as well as on the Dalai Lama, the researchers said, adding that computers at the Indian Embassy in Washington were infiltrated and a NATO computer monitored. The report will be published in Information Warfare Monitor, an online publication linked to the Munk Center.

At the same time, two computer researchers at Cambridge University in Britain who worked on the part of the investigation related to the Tibetans are releasing an independent report, the Times said.

They do fault China and warned that other hackers could adopt similar tactics, the Times added.

——-

Writing by Paul Simao; Editing by Peter Cooney.

Today we start something good, watch this video to hear how you can help Refugees find people who will help them. We need to stop this madness once and for all. Let today mark the beginning of something that will continue world wide!

Well here is something worth sharing, a chance to put your money where your mouth is. This by far is one of the nobelest causes yet, in my opinion. People all over the world are homeless because of wars and inhumanity to their way of life or beliefs and on November 10th bloggers around the world will give a voice to over 40 million refugees. Here is a quote from the site.

“On November 10th over 10,000 bloggers from around the world will unite to raise their voices on behalf of more than 40 million voiceless refugees. To ask the world to face the atrocities so many human beings must endure and to join hearts and minds to help bring forward information, understanding and action.”

For more information and how you can be a part of this go to this link

Bloggers Unite

Well there it goes we let our government sell us down the road, we are up the proverbial river without a paddle. Do you really believe this so called bailout will benefit you and your children and their future. People who are losing their jobs as I write this and the ones who already have lost their jobs this month will see nothing in their future from this. People wake up , when in the history of our country has anyone seen a president sign a bill so quickly? What do they have up their sleeve? It’s definitely not your best interest in mind, we the people are in for some very hard times and the only people who will be helped by this boondoggle bill will be the very rich. Don’t kid yourself, you have been sold a bill of goods. I highly suggest you stock up on food and load the guns because you will soon see an America very different that you are use to. More people will lose their jobs more gas shortages will become prevalent, more food shortages will occur, more failure to protect us from our enemies will occur. Bush and his cronies have taken our government hostage and set up the future administrations for failure. The world bank will soon own our country lock stock and barrel, we are faced with globalization on the corporate level as we have never seen before and soon the curtain will fall on this great country. If you don’t believe me then all you have to do is wait and see if I’m wrong.

Does anyone else notice that we are setting ourselves up for the coming of what some call the Anti Christ, yep that’s what I said. An economic crisis on world proportions that will be solved by the coming of a man. Before I go on let’s look at the nature of what Anti Christ really is. Many paint a picture of a man who will be evil and set our world on the course of destruction. In some ways this may be correct but not entirely.

Let’s look at the nature of Christ. Christ was the ultimate sacrifice in the literal sense, a lamb of God, a true blood sacrifice for the good of humanity. Now let’s put anti Christ in this light. A Man who is a true innocent brought to the ultimate sacrifice for all that is evil. Someone who will be killed for the destruction of humanity not the salvation. Now this is Anti Christ, and what will follow the sacrifice of one such person will be the stuffs that horror movies are made of. So it is not the man who will solve the problems of the world that will plunge us in to a tailspin of destruction but the death of this man. The beast that will rise from this death will not be the man but much like the churches that sprang up around the death of Christ it will be the consciousness that will spring up from this death that will be filled with control and evil.

You may think me crazy, I am, you may think me wrong, I don’t believe so. The coming of extreme Islam is only an element of the great war about to befall us all. There is no right side in this realm. We will all be victims of the madness and insanity will act as a purging of our world.

As I said before arm yourself with food and water, if you have guns get them ready (although they will only help for a short time) the best thing you could do is hope, hope that the scenario that seems to be setting itself up is not the one we all seem to fear in some way or another. It sits in our subconscious waiting like a beast to devour our peace of mind. If you are an intelligent free thinking person you will know what I am saying is true. Hope is the only weapon we have, but I fear it’s too late.

by Jan Lundberg
Culture Change Letter #189, June 20, 2008

The empire of cheap food is crumbling

You. Will. Not. Be. Able. To. Get. Food. Need this be spelled out any more plainly? It is time to consider that the stage has been set for petroleum-induced famine.

We have “innocently” accommodated rising population with greater and greater food production via technology and the profit motive. But now we have run out of room to grow, as biotechnology, for example, has severe limitations — major ones being petroleum dependence and topsoil loss. The biggest wild card for our existence is climate change, as we see with floods and other extreme weather affecting our food supply.

We are headed for massive shortages of food and other essentials, mainly brought about by the depletion of geological fossil reserves of cheap energy and water. The situation is demonstrated regularly with easy arithmetic based on statistical indicators from the United Nations, Worldwatch Institute, World Resources Institute, Earth Policy Institute, and numerous governments. Usually the full force of the message is offset by predictions of huge rises in future human population growth that are simple extrapolations of historical trends.

No one can say with certainty that the worst effects of today’s crisis will occur tomorrow or by any particular date. But it is irrational to assume there will only be gradual tightening of supplies until some solutions miraculously come to our aid. One ought to at least admit that one year ago few people thought we’d be going in the direction we’re going in, this fast, today.

Three days is our average food supply around the modernized world, i.e., for cities and their supermarkets. Long-term food stocks have plummeted: “Cereal stocks that are at their lowest level in 30 years,” according to Worldwatch institute in its most recent Vital Signs. This is exacerbated by increasingly weirder weather, compounded by the oil price/supply pressure on food. What can interfere with the three-day situation are truckers on strike (as in Europe), extended/repeated power outages, and the inability of the work force to commute to work.

I asked Chris Flavin, Worldwatch Institute president, about the escalating crisis that I assumed he was quite worried about. He told me on Wednesday,

“A lot will depend on the crop year and the weather. There is slack in the food supply system from meat consumption, for example. One steak’s energy requirement is the same as one gallon of ethanol. I see the glass half full and don’t have an apocalyptic view. We’re seeing fuel economy improvements and other self-correcting mechanisms. There’s $100 billion in renewable energy investment this year. We needed this crisis to start changing toward conservation. The pendulum is swinging again, as it did in the 1970s. We’re not going off the end of the cliff on peak oil. Production declines will be gradual.” I sent him my thoughts on the latter, with my thanks. I sure was surprised that he wasn’t half as worried as I am. Maybe he does not see as much of a problem the fact that the nation’s infrastructure is petroleum-based. He probably would not agree with me that the Earth is being murdered along with us human beings.

Zap! A global-warming heat wave kills many thousands in a U.S. city. Other cities take note, realizing their own cities are “like the one that got zapped last weekend.” Between the water supply problems, energy overload for air conditioning, rising prices for food, water and gasoline, people try to escape the urban heat island effect. Too many consumers stocking up and trying to split town exacerbated the tragedy.

When cities run out of food, and people want to leave en masse, they will get stuck in traffic jams the way fleeing (potential) victims of Hurricane Rita did in 2005. Will survivors be the ones who had the fullest gas tanks? Will these survivors also require guns to obtain food outside the city, whether by hunting or sticking up some hapless or well-armed locals?

Culture Change’s reports do not intend to add to hysteria. Indeed, if only there were no reason to be alarmed. But looking at our collective situation, it is difficult to see how wrenching shortages are avoidable. The consequence of reactions to these shortages will not be pretty. Without facing this, and taking action to prevent it, our Ship of Fools is on a course to hit the rocks.

Whether you are relatively “set” — with local food supply, not just money — or you are living from paycheck to paycheck and thus depend on the trucks coming into the supermarket without a hitch, you will not be immune to some interruption or limitation on the food you have probably taken for granted. As petroleum is in fast-dwindling supply and is relied upon for mass producing our food, shipping it (on average 1,500 miles for North Americans), packaging it and preparing it, we are up against a petroleum-induced famine of our own making. What evil-doer will we blame instead of ourselves?

The good news is that creative ways to obtain wild food are alive and well. Acorns and insects, however, are frowned upon — by the conventional consumer well fed for now. Is it time to stop cutting down oak trees? Poisoning snalis that are the escargot species? Wasting our nitrogen-rich urine by flushing it into our water supply instead of feeding it to fruit trees? Let us go over other options that we have:

Will we bring back the Victory Gardens through depaving and planting food in lawns? Until the food pops up for harvest, what will we eat — cats and rats? None of these sudden strategies can feed millions of hungry people in cities that don’t have pro-active leadership as yet. Yet, pedal power feeds millions in many a Chinese city surrounded by small farms. But every day the global economy plugs along, China is more fossil-fuel dependent, using far more coal than the U.S. and the U.K. combined.

Progress has been illusory in the last half century, but the period has been ballyhooed as amazing. “…the amount of grain produced per person grew from 285 kilograms in 1961 to a peak of 376 kilograms in 1986.” Since then it has gone down to 350 kilograms. China’s is 325 kilograms, the U.S. enjoys 1,230 kilograms, and in Zimbabwe — which Richard Heinberg told me is a guide to U.S. society after petrocollapse — is just 90 kilograms per capita. [Worldwatch, 2008] Can the most modern in the world really conserve the Earth suddenly?

There’s no let-up on the horizon, but people fervently hope for relief, as sure as tomorrow’s newspapers will be printed. As sure as the July 4th fireworks will be another display of our powerful continuity. Is this “Summer Driving Season” our last hurrah? Meanwhile, people are hurting in the pocket book, and are buying less stuff because of the oil price trend. So they look to blame someone, such as OPEC, the major oil companies, George Bush, take your pick. Some await Barack Obama to take over the White House and cleanse us of our woes, but even he says that community action is where it’s at.

Clearly, a half trillion dollar war on Iraq was not what our finances needed. If all that money had not been wasted, oil prices and food would be cheaper than they are. But what about the trickle-down of those corporations profiting off the war? Surely those billions for the contractors, and the fat salaries for those Americans so welcome in the Land Between Two Rivers, aided our economy. Or did they? The war profiteers and their friends in the corporate media expect everyone to buy capitalist theory. But wouldn’t you rather have had the half trillion bucks go to more livable conditions in our towns, such as community gardens, extended hours for libraries, better pay for teachers, and preventive health care? Thought so.

Unfortunately, our socioeconomic problems are too deeply rooted in disastrous treatment of Mother Nature, for even radical changes in federal spending priorities to get us out of this. So, the big one is coming. Looking at the fundamentals of our society and how it has changed from The Great Depression of the 1930s, we are in for something much worse than those days when the family farms were intact. What is implied for the big one on the horizon, according to optimistic activists such as Joanna Macy and David Korten, is “the great turning.” Doesn’t sound too scary, so I hope they’re right. They will be right, but they seem to skip the unpleasant bit about collapse.

The empire is crumbling, but first we must go through end-stages as the Romans and others had to: increasing debt, falling agricultural output, over-extended military, growing urban population without much productive purpose, etc. But we’re the good guys! — we call our empire’s philosophy “Democracy,” and we are so clever with science. Really, though, we’ve simply done better at distracting the populace and giving them the carrot more often than the stick, apparently. This translates to consumer freedom through more goods. The Big Gulp drink in disposable plastic — who could ask for more? We have had none other than The Empire of Cheap Food. Cheap in the sense that cancer can be had at lower prices than previous generations had to pay. Also, subsidized petroleum (to this day as well) jacked up the food supply and the human numbers.

It’s amazing how really intelligent people can be in dreamland over the possibility of positive change coming to the rescue. It’s not just limited to the technofix. It’s the general idea that people “are becoming more aware,” or “there are more and more people getting into organic gardening, CSA’s (Community Supported Agriculture), permaculture” and the like.

To get an indication of which may be more valid — (A) the trend for salvation as indicated by the growing phenomenon of gardening as noted by the New York Times last week, or (B) the inexorable, accelerating crunch of dwindling resources for too many people no matter how positive they may feel now — let us consider the result of a test on the community level.

This was very recently done in a most aware and progressive place. The population is small but well educated, oriented to be sensitive to world affairs, affluent, and active for local improvements. Sustainability is a goal in the eyes of many.

Here’s what was found from a survey of small and/or organic farms: no labor-help is needed at the beginning of the summer, nor for the whole summer long. Not even free help, volunteering. The farms’ production are set and unchangeable, apparently. Too bad, when the amount of food imported from afar is about 95% of what is eaten. One would think that at a time of rising food prices and the awareness of the global energy picture, such as peak oil, and when climate change makes the growing of food far more chancy, there’d be a discernible interest in upping the output and adding to community involvement of local farming. But the fact that people are (1) not anticipating any more demand for local and organic food this year, compared to last year, and that (2) there is no apparent need to gear up for greater production, seems ominous. It seems to indicate that there needs to be a raving crisis to get people to change their habits and plans.

Meanwhile, with a 100-year flood on the Iowa corn fields — where erosion on monocropped, depleted soil killed by petroleum pesticides and fertilizer and mechanical tilling — we are in for a hell of a summer. Is your food secure? Are you gardening, saving seeds, and protecting precious land and water?

The food price increases have something to do with oil prices that have doubled in a year. And the oil prices have something to do with peak oil. And peak oil has something to do with wasting the Earth headlong into deprivation and ecological destruction. And it’s about civilization as a runaway train. If you don’t agree with the metaphor, just try getting off. Crash must come, and come it will, and soon. I hope I’m wrong that: You. Will. Not. Be. Able. To. Get. Food.

That would be our concern when the price of oil can skyrocket (which it is already doing) — if we were prudent. The price of oil is far too low when there are still countless people driving cars unnecessarily. Apparently these drivers don’t find global warming to be as a big deal as “the economy.” Because it’s money, and only money, that can change some people — until they find they cannot eat their money.

Where I sit, the plants are crying out: It’s near 100 degrees Fahrenheit two days in a row in bone-dry San Francisco. It’s the wild deviations from the averages that are deadly to life.

Charles Biderman, TrimTabs 06.23.08, 7:00 PM ET
Stratospheric crude oil prices precipitated by speculation are wreaking havoc on the U.S. economy.

Based on income tax withholdings data from the Daily Treasury Statement, the wages of all U.S. workers on payrolls were unchanged on a year-over-year basis in the past two weeks (Friday, June 6 through Thursday, June 19) and rose 1.1% year-over-year in the past four weeks (Friday, May 23 through Thursday, June 19). Both of those growth rates are well below the 2.8% year-over-year in May, and they are consistent with an economy that is contracting sharply.

As long as oil prices stay above $120 per barrel, the economy is more likely to slow than strengthen, and companies are not likely to announce much float shrink. With real wages falling, large numbers of jobs being shed, gas prices exceeding $4 per gallon almost everywhere and home prices falling about 1% per month nationally, this year is going to be tough for American consumers.

Believe it or not, there is plenty of oil in the world. What is in short supply are investors willing to go short oil futures. The open interest on oil futures worldwide is 2.6 million contracts. With oil prices at $135 per barrel, each contract is worth $135,000. To control $135,000 of oil, investors have to put up no more than $10,000.

A hefty $1.3 billion per month flowed into commodity trading advisers (CTAs) in the first four months of this year, and $700 million per month flowed into commodity exchange-traded funds (ETFs) in the first five months of this year. Those amounts do not even include investments through other vehicles by hedge funds and pension funds. The latest issue of Barron’s reports that $55 billion flowed into commodity investments in the first quarter of 2008, and probably at least one-third of that amount was directed into long-only investments in oil.
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In any case, if half of the $2 billion per month inflow into CTAs and commodity ETFs were used to go long oil futures, it would be enough to go long 100,000 contracts, which is equal to 4% of the open interest on oil futures. In other words, open interest would grow roughly 50% per year just from inflows into CTAs and commodity ETFs.

What is happening now is not demand destruction, it is a financial disaster. The U.S. consumes 21 million barrels of per day. At $135 per barrel, the U.S. spends $1.0 trillion per year on oil, which is equal to 15% of the $6.8 trillion in take-home pay of everyone who pays taxes. If oil prices rose to $200 per barrel, the U.S. would spend $1.5 trillion per year on oil, which would be equal to 22% of take-home pay. Moreover, those percentages of 15% and 22% do not even include the cost of coal or natural gas. In other words, the U.S. will be broke long before oil prices hit $200 per barrel, and the rest of the world would be sure to follow.

Another way to put the oil crisis into perspective is to compare increased spending on oil to inflows into savings and investment vehicles. For every $60 per barrel increase in the price of oil, the U.S. spends an additional $450 billion annually, or $38 billion per month, on oil. In the past twelve months, the inflow into savings and investment vehicles–bank savings, certificates of deposit, retail money market funds, and all long-term mutual funds–was $744 billion, which is $296 billion more than the additional money the U.S. would spend each year on oil if the price of oil rose by $60 per barrel from its current level.

From April through June, the inflow into savings and investment vehicles was $35 billion per month, down 43% from $61 billion per month in the same period last year. In other words, the U.S. will generate almost no savings if the price of oil stays at $135 per barrel. If the price of oil rises even modestly from its current level, the U.S. will be operating at a deficit.

If regulators raised the margin requirement for oil futures to 25% from no more than 7.5%, the oil market would crack. Unfortunately for oil users, regulators are unlikely to boost the margin requirement, unless outside pressure becomes unbearable, because the income of commodity exchanges and traders would plummet.
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But there are two other solutions to the oil crisis.

The first is requiring major players in the oil futures market to disclose their total positions of all kinds in crude. Given the importance of oil to the U.S. economy, everyone should be able to know who is going long crude oil in a big way. Institutional owners must report what stocks they own at least semiannually. Why should they not be required to report the amount of crude oil they are long?

The second solution is for oil consumers to make a concerted effort to go short oil futures. The U.S. government has been spending $280 million per month, pumping 70,000 barrels of oil per day into salt caverns. Instead of buying oil, why not go short 35,000 contracts monthly at $8,000 per contract, in other words selling high the crude we bought relatively low? What if other major crude oil users also went short oil futures each month? What if the Japanese government, airlines, trucking companies and utilities spent several billion dollars to go short oil futures each month until the oil market came to its senses?

It is insane for the world to go broke while oil traders and a handful of gangsters who control their national oil production make huge fortunes.

· Speech to US Congress will also criticise lobbyists
· ‘Revolutionary’ policies needed to tackle crisis

* Ed Pilkington in New York
* The Guardian,
* Monday June 23, 2008

James Hansen, one of the world’s leading climate scientists, will today call for the chief executives of large fossil fuel companies to be put on trial for high crimes against humanity and nature, accusing them of actively spreading doubt about global warming in the same way that tobacco companies blurred the links between smoking and cancer.

Hansen will use the symbolically charged 20th anniversary of his groundbreaking speech to the US Congress - in which he was among the first to sound the alarm over the reality of global warming - to argue that radical steps need to be taken immediately if the “perfect storm” of irreversible climate change is not to become inevitable.

Speaking before Congress again, he will accuse the chief executive officers of companies such as ExxonMobil and Peabody Energy of being fully aware of the disinformation about climate change they are spreading.

In an interview with the Guardian he said: “When you are in that kind of position, as the CEO of one the primary players who have been putting out misinformation even via organisations that affect what gets into school textbooks, then I think that’s a crime.”

He is also considering personally targeting members of Congress who have a poor track record on climate change in the coming November elections. He will campaign to have several of them unseated. Hansen’s speech to Congress on June 23 1988 is seen as a seminal moment in bringing the threat of global warming to the public’s attention. At a time when most scientists were still hesitant to speak out, he said the evidence of the greenhouse gas effect was 99% certain, adding “it is time to stop waffling”.

He will tell the House select committee on energy independence and global warming this afternoon that he is now 99% certain that the concentration of CO2 in the atmosphere has already risen beyond the safe level.

The current concentration is 385parts per million and is rising by 2ppm a year. Hansen, who heads Nasa’s Goddard Institute for Space Studies in New York, says 2009 will be a crucial year, with a new US president and talks on how to follow the Kyoto agreement.

He wants to see a moratorium on new coal-fired power plants, coupled with the creation of a huge grid of low-loss electric power lines buried under ground and spread across America, in order to give wind and solar power a chance of competing. “The new US president would have to take the initiative analogous to Kennedy’s decision to go to the moon.”

His sharpest words are reserved for the special interests he blames for public confusion about the nature of the global warming threat. “The problem is not political will, it’s the alligator shoes - the lobbyists. It’s the fact that money talks in Washington, and that democracy is not working the way it’s intended to work.”

A group seeking to increase pressure on international leaders is launching a campaign today called 350.org. It is taking out full-page adverts in papers such as the New York Times and the Swedish Falukuriren calling for the target level of CO2 to be lowered to 350ppm. The advert has been backed by 150 signatories, including Hansen.