Monthly Archives: July 2017

Where Did the Federal Reserve Get All that Money?

New Economics Perspectives has the article Where Did the Federal Reserve Get All that Money? Economist Stephanie Kelton posted this in 2012 to publicize the remarks of Federal Reserve Board Chairman Ben Bernanke.

The Federal Reserve, like any bank, can acquire an asset simply by crediting a bank account. In other words, the bank pays by creating money. As Alan Greenspan explained, the Fed has an unlimited capacity to spend in US dollars. It can pay trillions of dollars with a single keystroke.

A friend just posted this on Facebook. Although it is 5 years old, it could stand to be reposted every day until enough people understand this.

Are the Latest Russia Sanctions Really About Forcing US LNG on Europe?

Naked Capitalism has the article Are the Latest Russia Sanctions Really About Forcing US LNG on Europe?

Brussels has stepped up its diplomatic offensive against the US moves, warning that several oil and gas projects involving Shell, Eni and BP are at risk. On Tuesday, officials said Brussels was “activating all diplomatic channels” in an effort to persuade lawmakers to dilute the bill’s impact on European companies and the continent’s energy security.

Were you naive enough to think that the sanctions on Russia had something to do with their alleged interference in our elections?

It’s always about oil and gas. This time it may have negative repercussions with our “allies”. Is there no limit to our imperialism?



Actually, Tulsi Gabbard just talks rationally in an interview on Faux Noise.

What Tulsi Gabbard says is not so explosive. That she has to go to Faux Noise to say it is what is explosive.

It is very disturbing that Faux Noise seems to be the only corporate news medium to talk sense about Syria.

Flash loses final appeal: Adobe sentences its web tech to death

Cnet has the article Flash loses final appeal: Adobe sentences its web tech to death.

Countless nails have been hammered in Flash’s coffin in recent years, most notably by Apple’s Steve Jobs and also by Adobe itself. Now, though, there’s a date for the funeral: Dec. 31, 2020.

This may be the only good news I have been able to blog about in a long time. I have banished Flash from all my computer based hardware for a few years now. I instituted the ban after the first big security failure that Flash suffered. I have had to give up looking at some web sites that insisted on using Flash, but they have become fewer and fewer. By the end of 2020, I won’t be missing anything by refusing to allow Flash on my computers.

The Toreador Song

As I was listening to Carmen on SiriusXM, I got to wonder if the actual words to The Toreador Song could actually be what I learned as a kid.

Here is how I learned it.

Don’t spit on the floor-ah
Use the cuspidor-ah
That’s what it’s for-ah

Well, according to WikiPedia in the article Toreador Song, those are not the actual words.

The Mega Rich Are Getting Mega Richer: A Former CEO Exposes the Corruption Behind Their Obscene Paychecks

Naked Capitalism has published the article The Mega Rich Are Getting Mega Richer: A Former CEO Exposes the Corruption Behind Their Obscene Paychecks.

… between 1980 and 2014 the average real income of the Mega Rich has nearly quadrupled, increasing by 381 percent. Over the same period, the Merely Rich doubled their income while the bottom 90 percent lost ground, suffering a 3 percent decline.

This statistic is well known. One of the great features of this article is the answer to the Laffer curve that the mega rich use to convince people that their prescriptions for tax cuts for the wealthy are good for the economy. I am too lazy to reproduce the graph and the explanation here. You’ll just have to read the article if you want to know how to counter the Laffer curve. (I always thought this was misspelled. It should be the laugher curve.)

Jamie Dimon: You Make Us Embarrassed to be Americans

New Economic Perspectives has the article Jamie Dimon: You Make Us Embarrassed to be Americans by Bill Black.

The best economic estimate of the lost U.S. GDP over the course of the Great Recession is $24.3 trillion. Elite U.S. Bank CEOs led the three most destructive fraud epidemics in world history that hyper-inflated the housing bubble and drove the financial crisis that drove the Great Recession and caused this massive loss of economic growth. It is as if the arsonist that caused the firestorm that led to the largest forest fire in U.S. history that destroyed most of the forests of twelve states then held an expletive-laden rant denouncing the slow growth of the U.S. timber industry.

Apparently Jamie Dimon is the Wall Street Journal’s idol despite what Bill Black says about him.

Dimon is enraged that plaintiffs sued JPMorgan so often and so successfully for so many of the elite frauds that caused the financial crisis that drove the Great Recession and caused the massive loss of U.S. growth. It is not enough for Dimon that the federal prosecutors that Jesse Eisinger has portrayed as members of “The Chickenshit Club” in his newly published book refused to prosecute the millions of crimes for which JPM is criminally liable. It is not enough for Dimon that no prosecutor ever charged the JPM senior officers who led and covered up the frauds that drove the crisis. It is not enough for Dimon that the federal non-prosecutors did not require the resignation of any senior JPM officer for leading those frauds. It is not enough for Dimon that the federal non-prosecutors (and JPM’s board of directors) failed to “claw back” the bonuses that thousands of JPM officers received as those frauds’ proceeds. It is not enough that Dimon not only kept his job and his bonuses – he received huge raises for leading America’s largest criminal enterprise and (often) losing money for the shareholders.

If The WSJ has their way, and Dimon runs and wins the USA Presidency in 2020, he will do far more damage than Donald Trump could even imagine.

Intel Vets Challenge ‘Russia Hack’ Evidence

Consortium News has the story Intel Vets Challenge ‘Russia Hack’ Evidence. To show one example of the depth of this investigation and the hard evidence that was uncovered, here is a small excerpt.

The Key Event

July 5, 2016: In the early evening, Eastern Daylight Time, someone working in the EDT time zone with a computer directly connected to the DNC server or DNC Local Area Network, copied 1,976 MegaBytes of data in 87 seconds onto an external storage device. That speed is many times faster than what is physically possible with a hack.

Compare this kind of analysis to the suppositions and assumptions of the official “intelligence” agency analysis to see how little credibility the original analysis had. That lack of credibility was obvious to any technical person who read the original report, but this anaylsis just puts the hard evidence right in front of your non-technical eyes.

2017/07/24 1905

I thought I would do a little calculation of my own based on the numbers given in the article.

1,978 MegaBytes / 87 seconds = 23 Megabytes / second = 181 Megabits / second.

Verizon has a page on its FIOS service Find the right Fios Internet speed for your home. On that page they offer a service of up to 500 Megabits / second. So the speed of the upload quoted by the Consortium News article is well within the bounds of what is possible over FIOS. I don’t know if the DNC had connectivity at anywhere near that speed.

For comparison I looked up what a USB 3.0 drive could achieve. PC World has the article USB 3.0 speed: real and imagined from Jun 26, 2014. Speaking about the USB 3.0 specification, they said the following:

the newer USB 3.0, which can handle up to 5gbps (640MBps)

That is 5,000 Megabits / second. However the technology at the time the article was written could only handle 329 Megabits per second.

November 8, 2017

In a subsequent post, I talk about more information has come to light on the VIPS memo. This puts to rest my critique of the memo that I have made here.

Evidence shows DNC emails downloaded locally – NSA whistleblower

Capital Accumulation, Private Property, and Inequality in China, 1978-2015

Naked Capitalism has published the article Capital Accumulation, Private Property, and Inequality in China, 1978-2015.

To summarise, the level of inequality in China in the late 1970s used to be less than the European average – closer to those observed in the most egalitarian Nordic countries – but it is now approaching a level that is almost comparable with the US.

Just as I suspected, China has adopted some of the worst aspects of capitalism as well as some good aspects. The lower income earners are still making some progress, unlike what we see in the USA. The government of China will probably be able to sustain itself in power as long as the lower income earners continue to see progress. As that progress diminishes, and wealth gets more concentrated at the top, that is when we might see more open rebellion in China.

One key difference to note is from the following excerpt:

China has ceased to be communist, but is not entirely capitalist; it should rather be viewed as a mixed economy with a strong public ownership component. In effect, the share of public property in China today (30%) is higher than in the West during the mixed economy regime of the post-WW2 decades (around 15%-25%), but not hugely so. And while the share of public property in national wealth has declined to 0%, or even less than 0%, in Western countries (with public debt exceeding public assets in the US, UK, Japan, and Italy today), the public’s share of national wealth in China seems to have strengthened since the 2008 financial crisis.

As long as there is significant public ownership of wealth, China may still be able enforce some semblance of economic justice. The USA has passed up on an obvious way to increase public ownership of wealth in the USA. If the Social Security Trust fund were able to invest in the stock of publicly owned companies in the USA, our corporations might not be so pressed to maximize profits no matter what the cost to society. (I am not talking about individuals investing their share of the Social Security Trust Fund at retail costs in the stock market. I am talking about investing at the Trust Fund level where the funds are still aggregated and invested by professional pension fund experts at wholesale costs.)

What Does Russiagate Look Like to Russians?

Rolling Stone has the article What Does Russiagate Look Like to Russians?

But Americans surely helped usher in the oligarch era by guiding Russia through its warped privatization process. In some expat circles back then, you found Americans who believed that by creating a cadre of super-wealthy Russians, we would create a social class that would be pre-motivated to beat back a communist revival.

This may have prevented a backslide into communism, but a by-product was accelerating a descent into gangsterism and oligarchy.

As I observed what was going on in Russia after the collapse of the Soviet Union, this is exactly what I felt was the sad story. Their turning toward capitalism was taking on some of the worst aspects of capitalism. To some degree, China has followed the same path. Privatization in the U.S. is another example. We practically give away valuable publicly owned assets to oligarchs who become billionaires from that gift. They don’t even want to pay their fair share of taxes on the gift. This is the infamous transfer of wealth from the middle class to the ultra-wealthy.