U.S. China Commission Report reveals serious issues that need to be dealt with!

Reports of the Chinese hacking into government systems are nothing new. Along with the constant reports of substandard products being put on our shelves, there is little doubt that the Chinese pose a threat to our safety in a LOT of different ways.

The U.S. China Commission has just released a disturbing report, which indicates some alarming evidence that the Chinese might be a threat to our National security.

The first concern is what appears to be a growing capability to target satellites. I got the following directly from the report, which was provided to Congress:

The hearing was timely, coming only three months after a successful direct-ascent anti satellite test by China that destroyed one of its own aging weather satellites in low-earth orbit. This test was only the third of its kind by any nation in history and served as a useful reference point during the hearing to illustrate not only China’s advances in military capabilities, but also the extent to which China’s decision making process is still very much opaque. This incident raises questions about Chinese intentions in space. The Commission will address these questions as it continues to monitor developments.

In the same realm, it appears that China is actively developing capabilities to conduct "irregular warfare." It should be noted that in addition to this report there have been regular reports of hackers from China specifically targeting government systems.

This is what the current report concluded:

Several experts testified that if China were to find itself in an armed conflict with the United States and its allies such as that resulting from a Taiwan dispute, China is likely to employ an array of irregular warfare strategies against its adversaries. According to Michael Vickers, Senior Vice President for Strategic Studies at the Center for Strategic and Budgetary Assessments, a Chinese attack on Taiwan could entail special operations and cyber attacks on U.S. regional bases in Japan and South Korea, and might even include cyber attacks on the U.S. homeland that target the U.S. financial, economic, energy, and communications infrastructure.

Also covered in the report are previously documented cyber-intrusions into U.S. Government systems:

As evidenced by the trajectory of its military modernization, Chinese defense planners are seeking to accomplish the goal of undermining the U.S. military’s technological edgethrough a variety of disruptive means. Among these is cyber warfare. USSTRATCOM Commander General Cartwright testified before the Commission that China is actively engaging in cyber reconnaissance by probing the computer networks of U.S. government agencies as well as private companies. The data collected from these computer reconnaissance campaigns can be used for myriad purposes, including identifying weak points in the networks, understanding how leaders in the United States think, discovering the communication patterns of American government agencies and private companies, and attaining valuable information stored throughout the networks. General Cartwright testified that this information is akin to that which in times past had to be gathered by human intelligence over a much longer period of time. He went on to say that in today’s information environment, the exfiltration that once took years can be accomplished in a matter of minutes in one download session.

The report also concludes that the Chinese have been building up their more traditional military capabilities since 1992.

Going into the reasons why China has been able to accomplish this, the report states:

China’s policies of market liberalization have resulted in rapid export-led economic growth prompting increased foreign investment; development of China’s manufacturing capabilities; and integration into the global supply chain. China’s abundant and inexpensive labor supply has made that country an obvious place for multinational companies to expand their production. However, as Dr. Peter Navarro, Professor of Business at the University of California, Irvine, observed in his testimony, five of eight factors identified as major drivers of China’s comparative advantage—i.e., its ability to undercut the prices of global competitors—are considered unfair trading practices. These include its undervalued currency, counterfeiting and piracy, export industry subsidies, and lax health, safety, and environmental regulations. These practices violate China’s WTO commitments, especially regarding workers’ rights, market access, currency manipulation, subsidies, and the protection of intellectual property rights. These violations and unfair practices also contribute to a growing U.S. trade deficit with China, one that U.S. Census Bureau statistics confirm increased 177 percent in the past six years from $83.8 billion in 2000 to $232.5 billion in 2006.

Granting China a "Permanent Normal Trading Relationship" six years ago was sold to the American public as a means of making China a better place (more democratic) place for it's people.

Instead, we have seen a lot of questionable government activity, which includes a variety of criminal enterprises when we consider all the hacking, counterfeiting and piracy that can be directly traced back to that country.

The lack of safe manufacturing practices and counterfeiting also poses a threat to our safety. It should be noted that according to International Anticounterfeiting Coalition, counterfeiting is a $600 billion a year problem, worldwide.

There are no figures on how much of this comes from China, although most experts on this subject speculate a lot of it does. Additionally, there is a lot of evidence that a lot of counterfeit merchandise is present in our supply chain. This evidence would include products of a consumable nature such as drugs, also.

The FDA estimates that 10 percent of the drugs in our supply system are counterfeit.

A lot of this probably tied into another phenomenon traced to the Chinese known as corporate (industrial) espionage. Of course, there is probably less of a need for the Chinese to plant spies in our industrial complexes anymore. With the amount of outsourcing going on, they probably never have to set foot out of China to steal a lot of secrets from us.

According to the Washington Post, American companies are even outsourcing the manufacture of military parts:

The Pentagon is increasingly buying planes, weapons and military vehicles from private contractors that outsource the manufacturing to plants in China and elsewhere in Asia, the report said. But when questioned by the commission, defense officials admitted that they do not have the ability to track where the components of military equipment are made.

To me, given all the recent implications of Chinese intentions, this makes the least sense!

All of these factors have led to a loss of jobs within our country as corporations take advantage of cheap labor, which is often the greatest expense in any business.

This translates into record profits for the Chinese and a select few people in the West.

Given the safety, National security and economic implications, continuing down this road doesn't seem to be in the best interests of the average person.

The full report from the U.S. China Commission can be viewed, here.

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Microsoft is NOT the Biggest Hacker in China!

Chinese surfers are crying foul at Microsoft's launch of the "Windows Genuine Advantage Program," which turns a screen black when it detects pirated software. It is believed up to 200 million computer users in China have counterfeit software on their machines.

China is well-known for being involved in the knock-off trade, as well as, selling dangerous and defective products in the global economy. The news has had a lot of stories about them censoring the Internet, violating user privacy and being involved in hacking on an industrial scale.

Ironically, Dhong Zengwhi, a Bejing lawyer, accused Microsoft of being the "biggest hacker in China with its intrusion into users' computer systems without their agreement or any judicial authority," according to the China Daily. His argument is that this will cause serious functional damage to users' computers and according to China's criminal law, Microsoft could be accused of breaching and hacking into computer systems. Zengwhi has filed a complaint with the Chinese government about this.

Does this mean Microsoft won't be able to out-source work to China?

I wonder if Mr. Zengwhi's opinion was when it was revealed that the Chinese were data-mining the communications of Tom-Skype users? Tom-Skype is the Chinese version of the popular Skype software, which allows people to communicate worldwide using the Internet.

Privacy violations in China aren't limited to Tom-Skype communications, either. During the recent Olympic games, the government openly monitored Internet communications, using the excuse of security to justify what many believe was censorship.

The allegation that Microsoft is the biggest hacker in China is questionable. Governments from all over the world have accused the Chinese of hacking into their systems and it isn't considered safe to carry a laptop, or even a smart-phone when visiting China. Recently, there was speculation that Commerce Secretary Carlos Gutierrez had his laptop hacked during a visit to China.

In fact, if you follow the news, the theft of intellectual property is often traced to the Chinese. The FBI has caught numerous Chinese agents stealing a lot of private and government information in the recent past.

Pirated software is a huge problem in the global economy. It is estimated that one third of all software being sold is counterfeit. A large percentage of the software sold on auction and even e-commerce sites is counterfeit, also. It isn't unknown for a consumer to think they are getting legitimate software when they are not.

Besides costing jobs and revenue to legitimate firms -- knock-off software can damage a machine, or even lead to information theft when malicious software is added to the mix.

I'm sorry that that certain people in China are outraged by Microsoft's solution to the theft of their property, but let's face it, they are hardly the biggest hacker in China.

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North Korea and Iran Could Make Walmart Expensive

Once again the Chinese have shown their concept of fair trade to us as a sharp stick to the eye.....by funding the North Koreans with its starving populus with the money (and technology?) by their underground nuclear test, a bit after their long range rocket test. Uh, wake up global trade fans: this is not a country we should be dealing with or trading with but only talking to, similar to that horrible relation you hate to (but have to) deal with on holidays with the family. They have (with our help and even greed) taken our manufacturing base with subsidized workers, are looking at 8% GDP growth for the year, stimulated their system without debt (but backing further loan incentive guarantees from their banking system to the Chinese people and industry unlike ours which is like shifting money from one pocket to another (taxpayer burden) and worse.....we will go out and buy something from China to make matters worse. This must end, as Iran is in their pocket too, Brazil and China agreed to exchange currencies (avoiding the dollar) in trade, as the rest of the world is thinking as well. The cost will be higher oil prices (Iran and Venezuela, now Brazil and others) will ship oil to China through the back door, raising our cost to drive to walmart even IF we still have money, are employed and have a car to begin with.....and can hardly wait for the new imports in Chinese autos begins to nail the coffin lid on GM Ford and Chrysler further as they sink underground. Wake up, China (not Nikita K or the shoe banger of the old USSR) will bury us. We must regain control of this now. Fast action will prevent a very dangerous and explosive (no nuclear pun intended) situation coming. No trade unless the Chinese float their currency and announce their degree of subsidies to their industry and workers. India fine. China no more. This being Memorial Day, it is hard to describe our losses in the past of life to defend our country that has been sold out to China without a whimper but for the jobless, homeless and coming hassles to "bribe" Iran and North Korea not to use the toys we bought them via China trade.
It seems we learn nothing from the stores we shop in, that we manufacture little, and what is manufactured here is slowly stolen by the Chinese, who alone, can use missile technology to knock out our complete communications system (both military and public) and has mapped our electrical grid.....are we to believe this is a friendly status? And now, we are not independent, and must rely on China for much that is ONLY manufactured there. This is dangerous. Very dangerous and ultimately much more expensive than the savings found at walmart or others selling cheap labor as their idea of competitive and comparative advantage. It is absolutely beyond any reason that we let this continue and do not, instead, limit or end trade and rebuild our manufacturing base (with health care for all, welfare for all as Canada, Europe et al) and regain our independence and save our country so many lives have been lost to save for freedom from oligopoly here (hey wake up antitrust people in Washington!) and pay our workers. As Taleb comments in "Fooled by Randomness" the bottom line is few CEO's are worth more than their workers, and in fact less. So pay and grow...IF AND ONLY IF....we stop the idea unilateral trade is ALWAYS good as we can easily see that with China it is hostile and not good, but far more dangerous by the day. End it.
If not the dollar will find its way lower. Interest rates will begin to soar on all maturities longer than 5 years. And we should have been selling 100 year bonds recently to buy time and use the strips as guarantees embedded in all from mortgages, to saving GM, the banks, costing us little now, enabling us time for growth, and corporate borrowing to retool America.....so now lets do this. And raise tax rates fast and progressively with new deductions for research, and home buyers, and other areas where it is so needed, new energy sources, etc....and health care, saving SS and medicare, and welfare for those hit by the China disaster. As China bids up oil, and commodities DO NOT SELL THEM OUR FOOD SOURCES and FUEL as in the case of corn etc. And no more reliance on China for food in any manner unless it is something they actually do have a comparative and competitive advantage in raising for food. When I was young, it was dogs. Yes, now they sell us dog food, and we sell them chicken and beef and corn and more. This is the age of technology, and we must save the dollar (although we can not over time keep it, nor should we want it as the world reserve currency) by not buying from sources like China, but only those who are fair honest trading partners, not just those with cheap labor. Where is the help Mr Obama? Coming soon with Geithner's trip or will it end like Paulsen's trips under Bush. Set down the law on China. Demand do not negotiate. We are getting near (or have past) the no return point for our currency, our interest rates (which will make Argentina's in the 70's and 80's look low if the "world" decides to toss our debt and dollars out for a new "GDP or world based basket of currencies and gold" as in the greater than 100% range plus).
We would have to hike short term rates dramatically to protect the dollar, and also, at the same time, print more of them to absorb the debt we can not finance with savings. Enjoy the monuments this memorial day, we may have to sell them for cash by next year.
The forex and gold and oil and bond market is screaming at us. Cant you hear it? The world is (and will regardless) turn upside down, the power from north America to South, from the west to the asian tigers of the east. And unless it is mitigated and attenuated (and in the case of China......ENDED without our demands met) we will think the past few years of job losses and economic downturn to look great compared to what is coming. There is no love here. Like the mafia after a hit, this is just business. Nothing personal.

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The problem of unsafe products from China are just a symptom of the bigger problem!

Interesting picture about consumer protection, courtesy of Flickr.

In the past couple of months, we've seen some alarming stories about dangerous products coming from China.

Dirk Lammers of the Associated Press wrote:

Poisoned pet food. Seafood laced with potentially dangerous antibiotics. Toothpaste tainted with an ingredient in antifreeze. Tires missing a key safety component. U.S. shoppers may be forgiven if they are becoming leery of Chinese-made goods and are trying to fill their shopping carts with products free of ingredients from that country. The trouble is, that may be almost impossible.

The Lammers family shopped far and wide, and came to the conclusion that merchants sell all kinds of products from China. Even more alarming, even if the label didn't say "made in China," it likely has a component (ingredient) that was.

The reason for this is simple, companies make billions off the cheap labor found in China and other less developed countries lacking the same level of consumer protection, we think (my opinion) we have.

The U.S. Bureau of Labor Statistics, which keeps tally of labor costs abroad, doesn't seem to have any data on China, or India for that matter. I mention India because, we seem to be in the market for a lot of their labor, recently.

The closest I could find was Sri Lanka, which in 2005 (most recent year available) has a labor compensation rate of 52 cents an hour.

I noticed a lot of countries left out. For instance, the region to the South of the United States, only has data for Mexico and Brazil. Mexico, which has a better economy than most of the area, has a labor cost of $1.57 an hour.

Maybe this is one of the major reasons our border to the South isn't very secure. Minimum wage, or even welfare benefits must seem like a king's ransom to some of these people.

Going back to China, I was able to find an estimate of labor costs in China by using Google. Judith Banner wrote in the Monthly Labor News Review:

Employees in China’s city manufacturing enterprises received a total compensation of $0.95 per hour, while their non-city counterparts, about whom such estimates had not previously been generally available, averaged less than half that: $0.41 per hour. Altogether, with a large majority of manufacturing employees working outside the cities, the average hourly manufacturing compensation estimated for China in 2002 was $0.57, about 3 percent of the average hourly compensation of manufacturing production workers in the United States and of many developed countries of the world.

A little higher than the government figure for Sri Lanka, but not much. Of course, I can think of a lot of countries, we outsource the cost of labor to, not included on the government list.

It makes sense -- that since a lot of these countries have a much lower standard of living, as well as, not very many consumer protection laws -- unsafe products have the capability to spread, worldwide.

In fact, with counterfeiting (another worldwide problem) thrown in, who knows what might show up in the supply chain? For example, it was recently disclosed that counterfeit drugs from China were likely being dispensed from pharmacies in the United States.

Chris Hansen, Dateline, did a pretty revealing story about this, here. The FDA did announce new rules, shortly after this, but I'm not sure this makes us very safe. All sorts of illegal drugs, make it past customs, daily.

I'm not sure if blaming China is the solution. After all, we aren't only outsourcing labor costs over there. Many of the other countries we outsource labor to, don't protect their people very well, and could care less about, consumer protection, also.

In fact, in many of these countries, people have a hard enough time keeping food on table!

Perhaps, we should take a closer look at ourselves? There are corporations here in the West, making a lot of money by stocking these products on our shelves. And at less than 60 cents an hour in labor costs, it must be extremely profitable for them.

The worker in China, or Sri Lanka isn't living very well off less than 60 cents an hour.

Perhaps, if certain companies had to start paying the true costs of padding their bottom lines with cheap labor, it wouldn't be as profitable.

I was amazed that despite all the special interests, obviously behind the recent immigration bill, that it was promptly defeated by the voice of the public. Many of us believe this bill, was at least in part, a ploy to drive down the cost of labor.

I'm not saying that all the politicians had ulterior motives, or that all corporations lack ethics, but it did reveal that the voter (individual person) has a choice, and more importantly, a voice!

It might be wise for politicians and corporations to get more on board with their voters, and customers.

If you are interested in learning more about this, I recommend Lou Dobbs, who has become extremely outspoken about a "war against the middle class." His site can be viewed, here.

Here are some references used for this post.

Article by Judith Bannister (Monthly Labor News Review), here.

Article by Dirk Lammers (AP), courtesy of the Washington Post, here.

Counterfeiting merchandise is enabled by outsourcing labor (my opinion). I've written a lot about this, here.

Previous posts about China and other dangerous activities coming from there, including espionage and hacking, can be viewed, here.

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In China, Censorship is Called Security

Senator Sam Brownback (Kansas) is warning that China is planning to mount a massive espionage operation on guests staying at major hotels during the upcoming Olympic Games next month.

This shouldn't surprise anyone. Although they consistently deny it, China has a history of spying on both business and government visitors. They also consistently get accused by governments around the world of hacking into sensitive systems.

Recently, there was a lot of speculation that Commerce Secretary Carlos Gutierrez's laptop was hacked during a visit to China and the information was used to hack into government computers. Saavy business types have been quoted as saying that they do not carry laptops or smartphones with them while travelling in China. Of course -- if you needed some more substantial proof China is behind a lot of espionage -- you could read about all the people getting caught by the FBI stealing sensitive information for the People's Republic.

Senator Brownback made a statement on Tuesday that he was warned that the Chinese Public Security Bureau has made it mandatory for hotels chains to install spyware and special hardware by the end of July. Failure to install the required items (or disabling them afterwards) will lead to "punishment," according to a document in the Senator's possession.

Of course, all this is being done in the name of security, according to People's Republic officials. Oddly enough -- possibly to address privacy concerns -- they plan to employ pop up windows warning people the Internet is not private in China. I'm sure this is assuring to privacy advocates, worldwide (pun intended).

The Senator's staff handed out English language translations of two separate documents he said were received by hotels, outlining the government's instructions on how to implement Internet spying software and hardware by the end of July to members of the press on Tuesday.

In many people's opinion -- the intention of this security system is monitor people -- who might want to expose China's dismal human rights record during the games. In fact, Senator Brownback was initially warned about these so-called security measures by human rights advocates.

Further evidence of this is that on Tuesday access to sites like Amnesty International or any with a Tibet address were being blocked at the main Olympic press center in Bejing, according to the article in the Los Angeles Times on this story.

Senator Brownback announced during the conference that he and Senator Bunning of Kentucky were introducing a resolution calling on China to suspends it's plan to censor free speech and spy on people. It should be noted that years ago -- when bidding for the games -- China promised to not to do this.

While many speculate the intent of this so-called "security system" is to supress free speech (censor people), I'd highly recommend anyone with sensitive information be extremely careful if they are in China during the Olympic games. The real espionage and hacking will not be as apparent as this has been. A good place to learn about Chinese hacking and espionage is the Dark Visitor site, which should give anyone a good idea what information risks they might face during a visit to China.

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DOD Analyst Convicted for Selling Information to China

Despite a lot of official denials, it seems pretty clear the Chinese have no qualms about stealing as much intellectual property as they can get their hands on.

On Friday, the Department of Justice announced that one Gregg William Bergersen of Alexandria, Virginia was sentenced to 57 months in prison (plus three years of supervised release) for disclosing secret information to a naturalized American citizen of Chinese descent (Tai Shen Kuo), who was then providing it to the People's Republic of China.

In his day job, Gregg Bergersen was a Department of Defense Analyst.

Kuo provided Bergersen with gifts, cash payments, dinners and gambling money in exchange for the information. The information involving military sales to Taiwan was then passed to Kuo's handler, an official of the People's Republic of China.

The official DOJ press release states that Bergersen didn't know the information was going to China. It would be interesting to discover, who he thought it was going to?

Kuo, who was found guilty on May 13th, is currently awaiting sentencing on August 8th and faces life in prison.

On May 28th, Yu Xin Kang, also of New Orleans pleaded guilty to aiding and abetting an unregistered agent of the People's Republic of China. According to court documents, Kang sometimes assisted Kuo in providing the stolen information to the unnamed foreign official. Kang faces ten years in prison.

Last year, another naturalized American citizen of Chinese descent, Chi Mak, was convicted of selling sensitive defense technology to China. This case was a family affair and Mak's sister in law and brother were caught by the FBI trying to board a plane to China with three encrypted CD's containing the stolen information.

The FBI site covered the Bergersen/Kuo case and another one involving a Boeing engineer, Dongfan “Greg” Chung, in a recent press release. Allegedly Chung was tied into the Mak case and sold information on the Space Shuttle and military aircraft to the People's Republic of China.

Although, the government isn't commenting much there is speculation that they are investigating information being stolen from Commerce Secretary Carlos M. Gutierrez's laptop during a recent visit to China. It is alleged that this information was used to hack into government computers.

Hacking incidents traced to the Chinese, although always denied by the PRC, have been reported all over North America, Europe and even Asia. A good place to learn about Chinese hacking activity is a site (maintained by a former DOD official) called The Dark Visitor (Information on Chinese Hacking) .

The Chinese are also suspected (in a lot of instances) of stealing corporate information. According to sources within the technology industry, it isn't recommended to carry laptops or other personal data storage devices when travelling in China.

On a personal note, I believe a lot of this is enabled by our free trade agreement with the People's Republic of China. While this agreement is lucrative for a few corporate entities -- the wholesale theft of intellectual property, counterfeiting, unsafe and defective products, as well as, all the human rights violations in China call for taking a hard and educated look at what is going on.

The problem is will special interests -- who represent the corporate entities making a lot of money from this -- prevent our leadership in Washington from taking effective action against what is becoming an alarming issue?

If you suspect anyone of selling government secrets, you can report them to the FBI by submitting an anonymous tip online.

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Chinese Red Cross Site hacked to steal donations!

Whenever a disaster occurs, there are always dishonest people trying to steal the proceeds of charitable contributions.

This is always sad because it takes away from the people, who are in need.

Heike over at the Dark Visitor is reporting that a Red Cross site has been hacked with the intent of "electronically" removing money intended to help the earthquake victims in China:

Verified by the Ministry of Public Security, a section of the official Red Cross website has been illegally hacked. According to the report, criminal elements gained access to the section of the website that held the special accounts for earthquake disaster relief donations.

An individual named Li Bujiu, had opened four fraudulent bank accounts to steal the funding.

Full story with more details from the Dark Visitor Site (Inside the World of Chinese Hackers), here.

Thus far, we haven't seen the flood of phishing, fake charity websites and the like come about as the result of the earthquake in China, or the cyclone in Myanmar reported in the West? Even this story isn't up on Google News yet.

Reuters did recently report that fraud is occurring inside China as a result of the earthquake disaster:

Police issued a warning after a flurry of text messages hit mobile phones, soliciting disaster assistance in emotional appeals, only asking that funds be deposited in private accounts.

The Reuters story -- which does mention that the Red Cross was shut down because of too many vistors (?) and had a page listing bank accounts to contribute to (??) -- can be seen, here.

The story in Reuters references the site, http://www.crcf.org.cn, which as of this writing appears to be up and running.

Not sure why more news on disaster fraud from China isn't being seen? It could be attributed to the "Great Firewall of China," or the fact that hacking and committing fraud carries far more serious consequences in China than it does here in the West.

Generally, if caught, offenses like hacking can mean the death penalty in China. In 2006, China carried out ten times more executions than the next country who still uses captial punishment. Generally, they use one round from an assault rifle (hollow-point) to the back of the head.

Of course, that doesn't mean that there isn't a lot of hacking coming from China. We see stories all the time about Chinese hackers committing corporate and government espionage. The Dark Visitor is an excellent site, run by a former intelligence type, about the mysterious world of hacking in the People's Republic.

I guess the difference on whether you get a bullet in the head, or not depends on whether certain authorities approve of your activity (my opinion). Of course, they are not beyond setting an example from time to time if certain political conditions exist.

Last year, China executed their former food and safety chief (Zheng Xiaoyu) for taking bribes in the wake of all the news stories about defective and dangerous products being exported from China.

With all the humans rights violations, fraud, hacking and deception that occur in the People's Republic, it's amazing that so many companies in the West continue doing business with them.

Sadly enough, some believe this has been at the expense of many people in their own countries. Given the human rights violations, it is also at the expense of a lot of Chinese people, also!

Perhaps, I'm old fashioned, but I sometimes wonder when people will come first?

Sadly enough, greed often gets in the way of this concept.

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The Consequences of Economic Arrogance

I have said for months (years?) to remove the dollar as reserve currency. It is the source of all from Mideast inflation to inflation in the US, and turn it into a digitized basket of all countries based on GDP updated quarterly. China gets humgry, and food here goes up. One reason is we have no quotas as Brazil for export. Hell we export oil if a company (at the expense of  all citizens) can make money.
same with food (grains, beef, etc). If there was enough profit to sell all food sources to China there is nothing to limit this. Starving us, and hearing happy burps from well fed Chinese. We are 300 million. china is 3 billion and india is 3 billion, Indonesia nearly 3 million. This is global trade? Even Israel and Chinese governments subsidize food and energy for their populations. This is called socialism yet it works and they are doing well. Capitalism walks hand in hand in the EU (larger GDP than US) and China and Israel and Canada etc.
Rational thinking would be to level the currency playing field by removing the dollar as reserve (and by the US) as without it, there is no stopping the inflation. The Fed can not tighten and kill inflation here as it has no effect on China consumption, just on killing ours.
Second extend duration by selling 100 year bonds (at high prices low rates) as the strips alone could help solve SS worries, pensions, Medicare, Housing, and buy time for us to regain our manufacturing. China and India and Japan very quiet during the oil scare now, but have no oil reserves (India and Japan) to very small (China) So we know whose side they would be on to force oil down (in dollars......a basket a basket!!!)
And their goons in N Korea sell the nukes to Iran, while Pakistan is crazy. Both Shiite (Persian) and both hate Israel as much as any Sunni East or West of Palestine, er,  Israel.
Stocks up due to no other place to put money and for months, have said beginning in February, government cuts in spending and employment would find fear in the markets and next stop is below 6550 on the Dow. All income unless changes occur as mentioned above are international. Not domestic. No hiring is on the way and housing not help and straight down.
I remain with the thought there is no double dip, that we have had a pause and will head down again with higher foreclosures, more unemployment and lower GDP as this is exactly the wrong time for tea party crap.
Obama had it right. And switched. Volcker gone. Summers gone. Obama care under attack (god will they be sorry) and no money STILL paid into SS or Medicaire. If we made good on that promise we would be very bankrupt making them even, as treasury debt is a drop in the bucket.
Unless there is some intelligence in Washington DC and changes made, its time to leave the country.
While the debt per captia is low and no crisis anywhere (but perhaps Rhode Island and Alabama) how do government spending cuts (look at Canada and the EU and Brazil and China and Russia) help us? They dont, they destroy us.
Humanity before profits.
And if egos shut down the government on March 4th we are up shit creek with no canoe or paddles.
Good luck, from Wisconsin to Washington we have Egypt and rage yet to fix their action to do any good. Yet.
And aside from the dollar basket (Obama cash?) and lengthening duration of debt and quotas on food exports, we have a tried and true method to keep the US going ......after all this IS and emergency.
Raise taxes very progressively to WW II or Korean levels, NOW. or at least to Reagan levels of 50% but no multimillionaire or billionaires income can not take a 90% hit. Situation solved!

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What has always happened when issues destroy, and there is not game changer?

simple
WAR
this time maybe as odd as it sounds, as bizarre as Reagan dealing with Iranians in death to america days, for his saving of the contras in Nicaragua (oh....that failed but allowed us FACTUALLY....look it up, research it) that our enemies are friends too, that N Korea is paid off to destroy China or to cause huge electomagnetic flux to delete debt? who knows.China bans hoarding of oil, coal to cool prices  Now can you envision Pretchters or my levels as possible? the dow at 3400 (me) and below 1000 (prechter)
and where is recovery in war that costs and brings no bacon home> are voters redundant as all is set by the NSA and CIA anyway? Dont care. Dont wanna know. and can only say idiot policy from Nixon and Reagan on left us here, and ignorance of tea party fools will stick us here. unable to fix a damn thing. Or in short the voter is a fool. No research. no facts. does not know about bin Laden construction working for Zapata oil and friends of Bushes, and the late Hussein of Jordan etc on and on and on ...
the information age was to bring greater communication but the unibomber was right!
it brings lack of communications, and misinformation
and now if reagan was elected with iranian deals for cocaine sales for guns to save the contras is it odd that north korea is backed by a fucked up broken down indebted country like the USA? I would not rule anything out we are without purpose or point or realty and repubiclan lies = democrat lies which look tiny and miniscule due to tea party lies.
I feel sorry for us all. And for Obama. As there is no way out as the time to change the game has passed. good luck all.


China bans hoarding of oil, coal to help ensure supplies, cool price hikes





ShareretweetEmailPrintTopics:Commodities Elaine Kurtenbach, AP Business Writer, On Tuesday November 23, 2010, 3:46 am

SHANGHAI (AP) -- China is banning the hoarding of oil, coal and other key commodities, seeking to ensure supplies and cool prices that have surged to politically volatile levels despite repeated moves to curb inflation.



The moves reported by state media Tuesday are Beijing's latest effort to counter unease over inflation that jumped to a 25-month high of 4.4 percent in October. Authorities want to reassure a nervous public that the government can handle inflation pressures that some worry could spiral out of control.



The National Development and Reform Commission, China's main economic planning agency, forbade provinces from limiting shipments of coal beyond their borders, ordering them to ensure stable supplies. The Commerce Ministry, meanwhile, ordered local authorities to crack down on hoarding of oil, gasoline and other fuels, on bogus, or shill, bids meant to drive prices higher, and other illegal practices.



The central bank raised interest rates on Oct. 19 and all signs point to more rate hikes in the months ahead, economists say, as China tries to pull excess cash out of the economy at a time when the U.S. is trying its best to stimulate growth.



Authorities say soaring food prices -- which jumped more than 10 percent in October -- are mainly to blame for the current bout of inflation, but costs for fuel and other necessities have also jumped, as supplies have run short.



Coal, which fuels about three-quarters of the country's electricity generation, is a special concern, especially in winter months when it also is used in heating systems in the north.



Much of the coal is mined in north-central China and then shipped to big cities, utility plants and factories in the eastern coastal regions.



The planning agency complained that some areas, which it did not name, were requiring coal traders to obtain special permits before they can ship coal. "Coal production in some places is rather chaotic and supplies from small mines are unstable," it said.



Seeking to counter widespread shortages of diesel, the Commerce Ministry issued a raft of orders aimed at improving monitoring of supplies and what it calls "market order."



"Oil is important to the people's livelihood strategies for goods and materials, local competent commercial departments at all levels should fully understand the market supply of refined oil security, stability, the importance of oil prices," said a notice posted on the ministry's website.



It urged officials to show a "stronger sense of responsibility." The government has already ordered state-owned refiners to step up production amid signs they were holding back in anticipation of a rise in government-controlled retail prices.



Diesel supplies already were running low after thousands of factories bought diesel generators to cope with power cuts imposed by authorities to meet energy-saving goals, further boosting demand.



Stable fuel supplies are a crucial link in the government's war on inflation, since farmers need diesel fuel to run tractors and other farm equipment.



Economists have forecast that China's inflation rate will likely rise to over 5 percent in November. But local newspapers in Shanghai reported Tuesday that prices for some vegetables had already fallen by as much as 40 percent since last week.



"Stable prices: We have confidence," said a cartoon in Tuesday's online edition of the communist party's newspaper People's Daily. It showed four fists striking at an upward arrow labeled "prices."



Another online illustration, though, was pictures uploaded to one of the newspaper's popular bulletin boards showing people hauling and counting huge bundles of cash during the civil war days of the late 1940s, when China's currency was worth less than its own weight -- an apparently satirical, anonymous, comment on the current situation.

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Short Memories, Or What Bush Left Obama To Fix Part 2

Hate to think I am appealing to conservatives or liberals......I believe in socialism and capitalism hand in had, and not being mutually exclusive.
So wrote what a great job (burp) the private sector did in the last 8 years prior.....and what issues were already here, that are not new, just a blame game going on.
The dollar should not be the reserve currency as it IS dangerous, as the threat will always be there if any sector gets ticked. Our debt was talked down and also bought down to low low rates artificially by the huge trade deficit. One of the more hideous parts of getting rid of a trade deficit is 1. causing a serious recession so your citizens are too poor to buy anything, let alone imports, and 2. devaluation of the currency.
Its exactly what the Chinese do. So whats all this crap about worry when the same worries were here last year, the year before, etc.....and the only thing I think Geithner and Bernanke and the brain trust with Obama are doing is "out-doing" the Chinese at their own game.....fair is fair. But first, lets decide on a new basket for what will be the world reserve currency. Or maybe they are. The talk of reducing the US debt is not going to happen as we have taxing power unused but has been around since Reagan rang it up.
They never talk of the total debt notice? Only the budget deficit as % of GDP. Not so hot now. But reducing health costs is a way to reduce the budget deficit too, as now it consumes 17% of GDP and is the fastest growing chunk. All in all it would subsidize (like China.....as we hate so to be compared with europe.....and resemble China more in the oligopoly detail than europe anyway....which wants slow and steady and is far more anti trust than we have been).
So we now see the trade deficit cut by more than half from slow activity, and if the dollar could nose dive just prior to realigning a basket of currencies for reserves for the world we would be very happy campers. At least have a chance. I am upset no mention of the North Korean issue having been solved has come up (remember? China said they would restrain their pals, and N Korea was shown dismantling their nukes......ha....ha....ha.....during the Bush administration. Guess not!) As for Iran, Bush constantly blamed Iran for stirring the pot, would not speak to Iran (but if someone was holding "Death to America" day annually since 1978.......you'd think we could sit down and discuss matters or at least show the same fake photos of Iran removing their weapons from their nieghbor Iraq's area.....Cheney could have had it done in quality video like the N Korean deal) but no.
Or talk to the Chinese about it....but no. We all know where those missiles are aimed anyway. And they can defend themselves but ONLY with our economy growing and healthy.....they dont need our help, just our money and no parts made in China (that may slow down their military).
Its the North Korea nut job that has me worried. Iranians get to go to the wonder area of paradise with thousands of virgins, so they and the Pakistani's bother me. Israel has certainly been mum lately. As have Egypt, and muslims countries points west of Israel. Sort of makes me want to be Bahai or in some way become part Isalmic for the afterlife part......better than harps on clouds in my book. Before you say anything, I am attempting humor, not trying to offend.
Anyway, I think the administrations approach is fine, will devalue the dollar (as China has refused to let their currency float) and we have reduced their income with the last of consumption, albiet due to poverty and debt up the whazoo.....but all in all over time this could work out. Maybe the Israeli's will have to compromise with the Palestinians, peace could break out, China will continue to grow forcing their currency higher, like it or not, and it would HAVE to be included in a world basket for reserves (the Indian rupee too Toto) and BRIC currency with the yen, euro, and a tad of gold or a digitalized index of gold as the rest would be GDP based I would hope. And we (with higher rates, and changing the way credit is computed by Fair Isaac is neither "Fair" nor real, and to solve the housing issue I STILL WANT FAR LONGER DEBT sold in the manner of 50, 70, and 100 year bonds. And see them stripped by brokers (and see banks hit with the old time Glass Steagall act again and not owning or doing brokerage) and use the zero coupons to change the mortgage industry, making down payments unnecessary, job information less needed (tax returns an exceptionally bad estimate of income as are the fact of work which can be terminated) so this guarantee embedded in the mortgage using these bonds spreads the debt out further, and a good thing (higher rates) will actually encourage savings!!!
The Chinese save 50%. The Japanese nearly 25%. The Europeans 15 to 20% and this is a good thing. Consumption will begine again when targets are met.
Also note, savings are high EVEN IN craddle to grave "shared risk" (refuse to use socialist) countries. And yet not here! So in time, some very good things can happen.
But China is not one of them......and its time to remake, retool, or whatever you wish to call it.....and bring manufacturing back here and pay workers well to make quality competitive innovative products. Unless you would prefer losing part of California to a nuke from nut korea, and israel dealing with (wont even try the spelling of I-make-a-dance-a-job president of Iran....anyway, the mullahs are in control....two parties....just like us) and the cost of that situation, the lives lost is worth trading with China and seeing your old roy dog food money from Walmart headed to the worst neighborhoods (Sam Walton would be turning in his grave) and continue trade with all others .....and add Cuba. No better way to make friends and be pals than trading with a country only 90 miles away and dump the one on the other side of the planet. And why, why are we not heavily wooing Brazil....and Argentina and Chile....and everyone on this hemisphere in latin america? We could be rolling in the oil if we stopped tossing darts and barbs at other's politicans and systems.
Just play baseball, trade, eat hot dogs, and life will be (in a dozen years or less) great again. Mr. Obama, et al......keep on going. Moody's ratings dont matter, nor FICO scores (both so in error on most ratings its obscene) and we need to stop this dollar as the currency of the world thing and kick the habit before it kicks us in the head. A basket, first lure China into the basket, and turn up the printing presses. Then detroy them, delete the extras (after the debt is paid with them....and remember the Bush Cheney administration and its economically challenged mindset that caused this disaster (and other things) and recognize indeed the private sector does not do better than the public. Both equally flawed, but one should always watch the other.

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The Fearful Fools Fretting Over China and Tire Tariffs

In March the Fed showed the markets they could gobble up a trillion in coupons without a burp. Fear mongers over protectionism worry China is just too big and powerful (in which case it is curious they do not float their currency isnt it?) and this will bring trade reprisals. Actually the timing is perfect and no.....
China (and from them Iran and North Korea) are not our BFFs or even close, and subsidize and control every part of their manufacturing process, from their currency and its deflated value to their purchase of gas and oil and food and housing for their workers (who are not competitive but paid a standard approved wage) and there is no freedom for us to buy their paper or equities (or god forbid real estate) but no barriers for them to buy ours. And no taxes either. Most recently, the per capita tax rate vs GDP was announced at 17% like most exporters, and oil producers, very low seemingly. Ours stood at 28.4% yet while corporate tax rates were high, the actual amount paid less than China at 11%....at least for the S&P 500. Most of whom avoided taxes.
I think this is the perfect time, pre G20 in Pittsburgh to bring ANY trade matter to bear, and use it as a wedge to demand they float their currency worldwide and open their markets. And it does not mean protectionism. It means fighting unfair trade practices. I have no issues with any other country at all. Just China. It would benefit us (as the debt is not an issue....not yet.....still small) for us to make demands now, and regain some of our manufacturing base which we need to survive. Funny how the Germans do it. The continually break even with the Chinese or have a positive trade balance and this with the euro in the clouds. So it is possible if we dont unilaterally give up our end. With through Bush we have. Now is a perfect time to bring up these issues before the G20 (out of which 90% would be on our side in agreement) that the Chinese must allow their currency to float. They bring up the idea of a basket. Funny they dont include their currency in it. And must as their GDP is high enough to grant them a 25 to 30% stake in a basket.....but would require them to (unlike the SDRs) include their own currency.
So fear that the poor here (which is a huge group) cant buy cheap tires and send their money to China is crap. Lets make the tires here and force China to play fair.

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The new red menace, global commerce from China

You would think that we would have learned by now that products from China can be DANGEROUS for a variety of reasons.

Most recently -- our pets were poisoned and millions of dollars of products were pulled off shelves -- after it was discovered that pet food imported from China contained poisonous substances.

Washington Post article on this, here.

The FDA is NOW warning that they are putting antifreeze in oral hygiene products.

I guess poisioning our pets wasn't enough?

From the FDA alert:

FDA has identified the following brands of toothpaste from China that contain DEG and are included in the import alert: Cooldent Fluoride; Cooldent Spearmint; Cooldent ICE; Dr. Cool, Everfresh Toothpaste; Superdent Toothpaste; Clean Rite Toothpaste; Oralmax Extreme; Oral Bright Fresh Spearmint Flavor; Bright Max Peppermint Flavor; ShiR Fresh Mint Fluoride Paste; DentaPro; DentaKleen; and DentaKleen Junior. Manufacturers of these products are: Goldcredit International Enterprises Limited; Goldcredit International Trading Company Limited; and Suzhou City Jinmao Daily Chemicals Company Limited. The products typically are sold at low-cost, “bargain” retail outlets.

In case, you have used any of these products, the FDA recommends that you advise them in this manner:

Consumers can report adverse reactions or quality problems experienced with the use of these products to FDA's MedWatch Adverse Event Reporting program:www.fda.gov/medwatch/report.htm

(800) 332-1088

FDA news release concerning this, here.

My question is, given all this, maybe we should ban all commerce from China! The cheap prices aren't worth it. Perhaps, a little consumer mistrust, along with goverment sanctions might rectify this situation?

Other problems caused by free trade with China are counterfeit goods (including medicine), rogue websites (Internet fraud) and their army of hackers stealing everything from money to industrial and military secrets.

If you would like to read about other issues, I've written about, which are caused by "free commerce" with China, link here.

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Resources to avoid those dangerous Chinese products

There has been a lot in the news lately about dangerous Chinese products. At this point, there seems to be too many of them for the average person to keep up on.

I happened to be taking a look at Lou Dobbs' site and found some great resources that the average person can use to determine, whether or not, they are making a safe buying decision.

Since there doesn't seem to be enough oversight by our government to ensure our safety, I highly recommend taking matters into your own hands. Especially with the holiday season rapidly approaching.

On the site, I found a link to a U.S. PIRG page on recalled toys, here.

Additionally, the page had a safety blog set up by ConsumerReports.org, here.

Also, on the page, is a message from Mattel about products they have voluntarily recalled, here.

Of course, the Chinese haven't only been in the news lately for exporting dangerous products.

Here are some posts about other things they are doing that might be considered dangerous to the rest of the world:

China caught stealing government information again!

The Hackers from China are at it AGAIN!

How Dangerous is China

Here are another posts, I've done (with lots of references) about unsafe products from China.

The new red menace, global commerce from China

Of course, we can't only blame the Chinese. There are other forces in this equation, who are making a lot of money doing business with China:

The problem of unsafe products from China are just a symptom of the bigger problem!

Maybe if we started making more educated shopping choices, some of these problems would go away?

After all, the almighty dollar has a lot of power!

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Like A Rolling Stone A Dog Without A Bone? Woof!

We are watching the old snowball effect, as unemployment continues to rise, less will be employed, the less employed the less reason to hire, the more issues with credit, defaults, and to face facts we will turn up when.....without action on China first.....we take this country back from corporations, demand China makes moves in Iran, in North Korea, and exposes their currency to world determination of its value, and explains exactly what subsidizes they give to their workers, and further OPEN THEIR MARKETS TO US! Go on, buy a bond or note, try a yuan, or maybe an equity in China now. Easy right? Easy in Japan. Easy in Chile, in Brazil, in Germany. Open an account and do it. Not so in China. Got a good idea? Try to start a business in China. China's trillion or 2 in our debt is on a computer blip under Kansas City. Their ownership of our real property exists, is not huge, and they are not prevented from doing so. We are in reverse unless a series of rules (which change if they feel threatened at all and cant copy or steal it) .....but sorry, we dont recover short of demanding their markets are open and their currency floats so we can sit and short or buy anything there from our computers here at midnight......and instead, the swap market hidden (they were "toxic assets" and are in reality more toxic now, but we cant see them.....even though the CME has devised an ingneous system to cross similar long with short swaps to get rid of the 450 to 600 trillion ....we dont know...and on PLANET EARTH, with a total GDP of 75 trillion...it would be nice to know...but no mark to market means my mortgage no longer paid, my credit cards, no longer with any value as I am out of money and defaulting, and need government help...the situation now, and with all the unemployed far far higher than the percentage given (right college grads without jobs, looking....but not counted...and all you self employed...recalling the nonsense spewed out about the job creation of the small business, etc, sole proprietorships, small llc's ....you are out of your self owned job (after paying unemployment taxes, social security taxes (that go into the general fund...accounting treachery) and much more.... and are now looking for work but not counted as unemployed, nor the 65 year old retired, with no income now but SS borrowed against our future, too old to be counted. The odd part is government workers are counted and they are a liability to those in the workforce as taxes pay their salary.
In short, we do not recover until we work as cheaply (but with no benefits, no subsidies, etc) as China, Vietnam, Brazil, and India. Then, barring our insolvency going unnoticed, or all the dollars and debt tossed back at us when we are not expecting it, barring the unexpected (which always occurs) it feels that we are never going to recover, unless some far more radical changes than Obama are made, and god knows he is working with such sociopaths (I assume politicians are as they lie so well) he is doing all he can with all the finest help. Each step is measured to change our antiquated corporate run system into a more fair system with shared costs for our "infrastucture" (namely, as the rest of the world knows includes health care FOR ALL and public and private can and do coexist.....and education, and welfare (social security has no money but an IOU from us (our Treasury) and never has....use it as the center for welfare, unemployment (that is living wage on can survive on without killing the banking system, etc) and give it to all those looking for work without it. Allow this for their educated and brilliant minds with innovative thoughts to create new wealth and risk it. Allow 5% to cheat. 5% always cheat. This should not impair the 95%, who make competition grow and are included in the workforce, self employed or not. Cost of health care so high, so imperfect, changing it to payer cost, disallowing pre existing rejection (so you cant sell your sister for any health care) and doing as today, covering the Bush made extra costs in medicare help would aid us all in the long run if we get that far. Break up the banks, smaller is better. Back to states, no brokerage ownership....bring back regulations by state regulators and federal and allow (demand) they not package and sell their mortgages nor use anything but exchange traded swaps as "insurance" so we could have a Bank of America....California. Bank of America...Nevada, Bank of America, Illinois. Fine. All separate. Now, those nasty toxins they own are visible and we know where they are. And Merril is not part of B of A, Bear not part of JP Morgan Chase, Paine Webber not UBS. etc. Separate them and each does what it should. The business each make money in. This is inefficient, but size somehow breeds greed that gets out of control. And the market "resting" higher for some time did so as rules on accounting lied about the system, the TARP money will have to return if they did accounting correctly. And how long would taxpayers let Bank of America, with REAL honest accounting in California (so we know they not only have horrible issues in that area with defaulting mortgages, foreclosures, credit card woes, and swaps that would sink the world.....are they too big to fail? No. Not now. We broke them down to state levels. Change, far more radical (shake it up and roll the dice) change must happen and faster. Or we can not survive. Sell US stocks (and the dollar, and treasury bonds, notes, etc, short the whole batch. As we will find over time exactly what we have been temporarily saved from (going over Niagra Falls in a barrel) and this time now we lower the height and power of the falls.......we bring back Glass Steagal, we prepare for demanding trade end now until they change with China. We make state banking laws again. We bring in a new group of dozens of primary dealers, some one must market our debt.
Housing can not go up. It may, through funding "shared" costs, stabilize but stocks wont. There is no profit in any but the innovative and those who export only and they are smaller than you think, only 10% of our country employed in production. So what exactly are we exporting? Our wealth now. Thats about it. And in exchange we owe. That will halt our progress. In the depression, Dorothy and Toto and Auntie Em had a mortgage (far different both in term and down payment) and none in the workforce only the tin man, lion and scarecrow were in the farming workforce, but as only 3, they did not have group insurance. Their bank went under, and they lost all. But could grow and hedge corn if they wished or barter. Their mortgage was not even found by potter (in a different movie later) for years so they had no payments though in foreclosure and Potter paid twenty cents on the dollar for it two years down the road. Now, out on your ass is faster, but no sales even at these rates means there is big trouble, that unemployment at this level affects far more than anyone thinks, as the real unemployment level, or under employed, or part timers without benefits, amount to 3 times this (see Dr. Drayton, genius award winner's paper on this about 10 years ago in the WSJ and his research ....as he wished with his genius grant....used to help then poor India, Indonesia etc...emerging countries grow by accuracy not lies in their numbers. Another benefit of the European and Canadian (and other) "sharing intracture" as I define it and many of them do too, is that no work from quitting, from graduation and no work, counts all as their welfare system helps all from falling through the cracks into oblivion, there is no credit to allow them to innovate if they fall that far as this country allows.
So things dont look good. And change must continue, and more radically and faster to prevent our demise. When marked to market comes back which it must (ask Japan) and mortgages, swaps, credit derivatives, credit cards, non payment of medical bills too great to pay, car leases and sales defaulted on, and more and more......where is the credit, the innovation to allow for growth. No agency can properly or accurately rate any credit issues of corporations or banks or people then, survival will be tough, and watch NYC and their prices as they are currently only picking your pocket and each others. When property values crash there, we are left in our system with 10%making things. 15% hauling them around to sell. 15% financing them and 27% selling them (as a breakdown of jobs and employment show. If you remove the buyers, with unemployment, cheating if you are China, then what part of this is fixed? None. It gets worse. Reality and numbers of defaults and toxicity are known soon. someday soon. Obama and Geithner I am sure would like to wait until we are stable. But unless the banks are broken up, and anti trust brought (as in Europe) much more quickly (is it appropriate for Walmart to earn 20 cents of EVERY retail dollar spent? or does it destroy competition like the perfect monopoly system in economics?
Some days services have no value. Some days changing all at Best Buy (essentially a monopoly in its way that is STILL not selling profitably without any competition) because another small player that Bush dismissed an enormous anti trust case against soon after his election that was Gores......called microsoft, will no longer sell Vista, nor XP (both will only be found on eBay etc) and we will find all new computers in August and September have Microsoft 7 operating systems. Not only can we not buy now from Best Buy but imagine having to update all (computers, software, etc) for a new operating system just because of lousy greed in Redmond Washington. It will fail even if the product is good. It sucks more out of the US population shipping it to where the manufacturing of the computers is: outside the USA. And why what is can not be made better is Microsoft has such minor competition.
G4 is out with Sprint. G5 is about the speed of cable data. Cable TV is needed for cable data. I called when I moved. Did I have a choice of providers? no. Just one. Just one line phone. And contract leases from Verizon and ATT. T-mobile later. 3 choices ....and cable is 99 a month 39 or 49 is TV which I do not want. So when G5 arrives, will dump cable for a G% wireless at half the cable cost. And listen to radio, and news and music. if I want TV direct satellite has so much more for so much less cost. And there are (ahem) two companies, DISH and Direct TV.
We also have two political parties. Mr Obama sir, this is our problem too. 2 parties is not democracy, two car companies is not competitive, one retailer is hardly competitive (oh yes, 80 cents are not spend in Walmart but who is the price setter? and the price taker?) Or microsoft. It is pathetic we have those trying to protect this democracy, this economy, which resembles China more than not, instead of those we say we detest, those Europeans, with competition, wealth available, shared risk in welfare, health, etc and killing us economically with 18 parties represented. Not 2. hell even Iran has 3 or more. Unreal. I remember Harry Browne's book ....something like "how I found freedom in an unfree world" by living on land he could grow food on, and eat. And live and that is where we are headed. We must redirect as in change direction, as the old system is a failure, and we must do so fast. Break up the banks into smaller chunks that can go down. And AIG. And all manner of the intelligence of Roosevelt (Teddy and Franklin) evend Nixon, Carter, Clinton and Obama who can see shared costs make life far far more inexpensive. With health we want the people to be the price setter. With software, with retail, with politics and with cable and all America we lost our anti trust division. Where it went is a RR great communicator mystery. But now we need it. And we need to let the parts we make from the whole be able to fail. Risk brings innovation and lower cost and competition. And those out there in offices shuffling papers (and honestly I dont really know what they do.....i would walk outside from the Chicago Merc, or Board of Trade after trading for 8 hours at 3 PM and wonder what the hell all those people did in those buildings all the time every day.
I still do. Bring back the 1934 securities act, the Glass Steagal act, and break up the logjam, banks love and keep us here. Short sighted banks. Short sighted monopolies in a democracy we want competition. In our legislators that deregulated us to hell and lowered taxes and will be going home when they raise them, but they must. And maybe next election instead of destruction of any new parties attempts, through lies or dirty tricks, we can find a way to change the laws to allow less than 5% of all registered voters to place a party and candidate on the ballots.
(in Illinois in any case.....different everywhere, some 10% ...
in a country where only 40% to 50% of the registered voters even vote, that is a tall order.....change it please).
And adding more and more laws is fun. Legislators appear to be doing things. But why not remove the old ones no longer valid in our time, all of which so archaic they are absurd, yet all can be dredged up to arrest anyone. Remind you of Iran? Of China?
We will be again, in recovery (from this economy and stupidity) when we are as cheap as Chinese labor. But, here is a hint to their success: THEY SUBSIDIZE ALL FROM FOOD, GAS, HOUSING, HEALTH, AND MORE.....we dont. That in China, and Europe, South America, etc....makes all the difference and Europeans love it we think they are slow. Russians doing well selling fuel to them. ....because the slower we think they are (and the more likely to fail) the lower the euro may be able to go as it is shutting down some (not all hardly) they are still net exporters, but for the UK....
and they have a secret. They are ok. They are not breaking up but adding to their size. They share. They have multiple parties in each country PLUS a governing parlimentary group that rotates, and will work until agreement is reached (considering the number of parties that is compromise....and competition)
And it works, in different ways in China, and in South America, OPEC someday in the ASEAN-4 (to be 8) and yet we think we are better. Obviously we are the ones in debt, the ones without a future any can see. And it is time to change our ways and fast before it is changed for us by our failing.

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And after my initial post.....my humiliation as human

And of course cheap, trying to save money went from web to Petsmart (looking to buy a couple dogs (rather large) a crate for each, refill the garbage can with dog food,
new stainless dog food bowls and found few but chinese products. And as they were nearly the same (as i refused to buy them....reading former posts will explain why,
I found myself in the middle of Walmart. I could not recall how I got there, I plead amnesia and banks cutting credit card limits when i have not missed a payment in 35 years, never late, never less than minimum amount or in full......so their cutting (especially B of A who as recently as 12 months ago offered me a 200,000 zero down fixed mortgage with no documentation as they see the money wired to my account monthly from trading account since 1995. I keep trying to leave them......they keep buying the bank I leave to get away) ....any who any way, their cutting of my credit limits reflects THEIR credit issues, but destroys my ability to keep my fico high.
And raised my rates on the accounts too? Why? Because they can.....I asked them to lower it. I am creditworthy and pay. Hence the problem, I found the idea is not to pay once and tried it last month. They called within two days and have called since daily (as AMEX has ...tried it with them too) and 7 days a week from 7 AM to 8 PM and get this.....I AM NOT EVEN 30 DAYS LATE YET!!!!! and calling after 2 days of the billing date? Just who is in trouble here. Me or B of A and AMEX? So I no longer answer and will demand lower rates and higher limits soon.....now that my FICO score get trashed by their immediate need for my cash at all costs......I told them they got it already to the TARP tunes, and last asked B of A to fork over additional 35 billion in capital fast.....not funny people I just hung up. Unfair that their credit issues weigh on my FICO scores and wish them a new twist on the Iranian "Death to America" day festival of hate......mine day will be called "death of bank of america" day, as they destroy (and have no patriotism only profit greed for money from anywhere.....so they may move away please and haul Ken Lewis with them) as they lower American FICO scores .....AMEX a worse offender....far worse, and both with the name "American" or "America" in them now preventing (due to lower credit scores and higher rates on credit though we have given them money via taxpayer future hikes, in enormity, and these lower rates prevent housing sales from proceeding, from credit to purchase goods from increasing for 75% ofthe public.
It not only unpatriotic but nearly treasonous.
Which brings me back to my temporary amnesia issue finding myself in Walmart buying Chinese because it is so cheap, due ONLY to cheap labor (not efficiency, nor the product superiority, no. none of these things, the currency too cheap by 800% and so saved 30 dollars vs Petsmart and Petsmart was far less than the local pet store special order, and cheaper than Amazon if you include shipping out of a total cash (no more credit card crap) purchase, now headed for China out of the USA of 190 dollars, saving me 16% (and also sales taxes on that 30 dollars, and nearly 50 % or more from the local folks I like, and 20% vs Amazon.
I am embarrassed, humiliated and know, if I am doing this, the population is continuing to hand over 20 cents of each dollar in retail sales to the Chinese gratis China (Iran too is thankful, as is North Korea) and so, we pay the debt of the banks, we pay the debt to China, we pay new debt as Iran endangers Israel more than a split state with the Palestinians and sooner.
All because of my amnesia. Acutally could not find a damn thing (but one) made in the USA. So hope for the stock rally and banks etc....must be based on the concept of a miracle occuring to make the USA workers wealthy, the middle class rich and the rich richer (all with health care and wealfare) and somehow the debt will disappear magically, as the growth without higher credit and wages and lower debt is like the scene in "Groundhog Day" with the old man dead on arrival at the hospital repeated no matter what. As I continue to say (and Bill Murray says in the movie "Any change is good). Or perhaps a large volcano will erupt destroying all China, followed by a sunami cooling in and burying Walmarts best buddy China tomorrow. Highly rare event.
And then, I could not have bought anything I did from elsewhere but China, as nothing is made here now, the beer issue a real problem. America, "baseball, mother and apple pie" .....and the beer at the game made here but for cheap labor as no major brewery exists in the USA as USA owned now. Sam Adams does not count.
And "as GM goes, so goes the nation". And there are many sayings, much at stake and yet without a national strike on these issues to stop and reverse the damage done in 30 years, we will be eating our dogs, the Brazilians will sell beef to China (and no longer need eat dogs as the stories of the past) and I will be very upset about my dogs but at least now they are fatter, happier and better BBQ'ing. Tasty? Hope I never find out.

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Short Memories, Or What Bush Left Obama To Fix

Seems some who are surmising that rates are going higher, or that the dollar may fly back in our faces or even that North Korea and China with Iran pose a large problem should run back a few months to see this existed in a far more dangerous form of insolvency without so much as a discussion during the problems forming over TARP money tossed to the banks without regulation. And there had been talk of the Chinese and even the OPEC countries dumping dollar assets, and using a basket. GM, Ford, and Chrysler were the walking dead waiting to drop, as was the banking system and the state of housing prices. Memories of those who wish not to acknowledge this was the solid republicans that got us here are those who forgot quickly that oil is certainly able to rise to 150 a barrell and gold to 1000 and now drive around ignoring the future of China's increasing consumption of fuel and food (with India) and their 6 plus billion people (vs our overcrowding of 300 million) that will grow this year (the Chinese say) at 8% GDP.......and say putting funds into new alternative fuel is causing a nightmare, oil is cheap and fundamentally (they think globally only when they wish) overpriced. This is ignorant, and China's use is picking up again with their money, and they continue to supply their workers and industries with subsidized gas and oil and food. This is what makes oil hardly overpriced, but in the long run very cheap now, and eventually gone for use but in cars that use it by the milliliter not the gallon. Our competition level is low for being able to out bid China or India for oil from Brazil, OPEC, even Canada...and as time rolls on, our costs will go up out of demand from non US fuel use. Gold seems only natural as an addition to the basket of currencies I imagine will come to replace the dollar as reserve currency for the world which is fine. As the worlds reserve currency we would ALWAYS face the danger of being a smaller economy in a world of fast growing giants from BRIC as well as emerging nations exporting their cheap labor, and always threatening to toss our dollars and paper held in debt in our faces. So deal with it. It was made a reality over the last 8 years. Now we have no choice but to keep short rates low and let long rates fly. We have seen the Fed (at the treasury's direction) monetize a trillion in coupons from bonds and notes, and even trash paper from banks like mortgages, so we can deal with China's paper, and more. Yes the dollar is going down. But until this world makes the decision, we should try something proactive like suggesting the basket of what a new world reserve currency would be, and then hit the delete key on the monetary policy desk at the Fed as our debt comes flying back. And tighten up. This will slow our economy, but this was happening naturally for 8 years anyway. The trade deficit was the reason for the "flat" curve connundrum that caused the wonder of zero down, adjustible (to libor? not to t-bill?) rates with no doc loans in the first place as bankers could not borrow short, lend long and make any money......they went so far as to use the yen.....this all long before Obama stepped in. We now have serious issues of debt and poverty and lack of consumption that is relatively permanent unless the banks change their policy of using FICO scores which are essentially a hoax for higher rates they can charge, as they have no basis on what money the borrower has saved out of the country, nor the value of their assets, nor their earning power and potential. Bill Gates has no need, and if he never borrowed any money would have a FICO score equivalent of one who is bankrupt. His wealth is not taken into account nor anyones in their score. And the score is only as good as your last month. Loss of work, and payment for 35 years at perfection are meaningless in one month of nonpayment (more like 2 days) when the unemployment runs out (fast....very very fast). So we are a country who SHOULD be on credit watch. We have no other choice but to raise taxes progressively on the wealthy, and must use new deductions to reallocate the money properly for highest health, education, welfare and economic growth. There is no trickle down. We understand that now after so long being shot that lie. And a flat tax is absurd, the effective tax rate is already highly biased keeping the poor from saving and also consuming. If I hear the lower half of the population pays no taxes I will have to kill a cat fast to relieve my anger at the fool who says this, as even the illegal immigrant pays the cornucopia of sales taxes, luxury taxes, phone, cable, electric, property (the renter pays it unknowingly) taxes that for the median income are nearly 50% of income, compared to less than nothing for those earning a million a year. And to make the country safe (for business if you are republican, for both business and people if not) if is important and necessary to keep it financially sound, reserach and use alternative fuel, change the way cars chug gas, and finally........if the private sector is so much better at this .....where would the banks be now without the TARP funds? Or the car companies without the loans? We would be a vanguished, ruined country now. Regardless of what is said, as listening to the BBC, the EU is working (with hassles that are being attended to and fixed) and they are all trying to allow us to talk the euro down saying it will be torn apart politically while knowing (and polite enough not to say it) that indeed the Euro will be around as will the EU.
As for those unlucky enough to have invested in the US from overseas, sorry....you have lost money no matter where you look. This is the reason the basket concept of a new world reserve currency will take hold and should. To maintain good relations with our allies and fair trading partners, we owe them this, and we also deserve to be a credit concern and by taking the first steps in removing the soveriegn danger to us of having the world use the dollar can be slowly mitigated. As for those who have a tough time remembering just a year ago, the fear and danger in the system, which is still there, but attenuated.....it came with the old regime of Cheney and Bush
oh...No one graduates from an Ivy league school with a C- by the way......the average grade is bought and paid for on admission and the tuition of 50,000 plus annually to be at least an A-/B+ so that all options are open to these students.....making Bush simply frozen by stupidity and so dangerous.....no serious plan but to breathe the same air as his Dad did and his hero R Reagan, the other biggest spender of history within his 8 years adding to our deficit on useless weapons that win no wars. Bad role model, and I listened to the great communicator for 8 years in California, and then Washington and wondered where the name came from, as he made no sense to me at all.
Recall, just recent history, gas prices, falling home prices, unemployment surging, banks in trouble cutting credit lines left and right, not even trading with each other, deregulated and (without big government) destroying the country only a year ago, and gas prices through the roof, the dollar dropping like a stone, only supported by demand to pay debt in dollars and then ask......could government do a job worse than the banks? Could government make the country more unsafe than running huge deficits in trade that allowed our enemies to play with nukes and rockets? Could we be more out of our way in the world than mired in a war in the mideast? The entire time, the private sector was screwing up and the public sector was doing nada...nothing to stop it. And we were on credit watch anyway (by the world, if not any "official" agency) and by our huge borrowing to support the Bush war and trade deficits and falling dollar. Bush was not business friendly. Look what happened. And stop complaining as though you dont remember the relief (all over the country and world) as Bush and Cheney left office. We are better off now, but the damage done is enormous and will take change, and a lot of time and repair.
Sorry about the cat comment. I would never do such a thing. Do like dogs better though. And birds. And trees, and orchids, grapes, wheat, corn (but not for ethanol) and all living things, but I like humans the most, and any policy that puts business ahead of humanity is a loser. You would be historically accurate to say that has been the case since mankind walked with clubs and lived in caves.....but then too, women and those unlucky enough to be human and yet different, were recently considered less than human, showing we CAN learn and change. Humanity yes. Business yes. We can have both do well, as a matter of fact, one cant do well without the other turning cartwheels anyway. Debt and budgets submitted are being critized by Cheney?????? Thats like ....well the shortest memory in history.....and like the kettle calling the pot black (or however that goes). What a twisted mind. And Colin Powell a gentleman not to hassle about the truth with Cheney. Cheney must be about to sell a book he is writing. Nothing like stirring up misinformation and lies to get people angry and then come out with a book. nice touch. Hey Dick, where were you when North Korea said no more nukes (and lied)? Or where were you with money from China flowing to Iran? Complaining it was not your job? Or someone elses fault? We got here on a very easy road to recall. We must remember never to do that route again. We can learn. We can see the issues and we can fix them in time. And we must to keep the country safe. Brazil doing nothing dealing with China that is anti US, hell we gave China the money to do so. Brazil is doing well, and supports us, Hugo Chavez not a danger, not a fan of us either.....but then again with Cuba and tons of sugar cane and doctors coming out their ears (let alone baseball players and taxable rum) what are we trading with Vietnam for when Cuba has more to offer, is much closer, and do to some Mafia, CIA, Las Vegas, hassle long ago, would make a great trading partner. Lets make sure all those near us, and in this hemisphere are preferred trading partners before we deal with those in the far east. Or as my mother used to say, if you dig a hole deep enough, you'll end up in China. Well, looking at N.Korea, Iran and China's attitude, we dug that hole already in the last 20 years, and its time to get out of that hole and fill it in again.

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China caught stealing government information again!

The Chinese, who were recently accused of poisoning pets and selling toxic toothpaste are now being accused of hacking into government computers in Germany.

Roger Boyes of the TIMESONLINE reports:

Der Spiegel, quoting senior officials from the German equivalent of Special Branch, said that the hacking operation was discovered in May. Computers in the Chancellery, the Foreign, Economics and Research ministries had been targeted. The Federal Office for the Protection of the Constitution (BfV) conducted a comprehensive search of government IT installations and prevented a further 160 giga-bytes of information being transferred to China. Commentators described it as “the biggest digital defence ever mounted by the German state”.

The information was being siphoned off almost daily by hackers in Lanzhou, northern China, in Canton province and in Beijing. The scale and the nature of the data being stolen suggest, the investigators say, that the operation must have been steered by the State and, in particular, the People’s Liberation Army.

Naturally, the Chinese are denying involvement, but this isn't the first time we've heard of them hacking into systems, or committing government/corporate espionage.

Here are a couple of posts, I wrote awhile ago where U.S. government computers were the target:

How Dangerous is China

The Hackers from China are at it AGAIN!

Last year, the FBI arrested two men stealing technology secrets and attempting to take them to China. Their press release on this matter can be seen, here.

USA Today (David J. Lynch) also did an excellent article quoting FBI sources about the problem, which can be seen, here.

We need to start considering the consequences of continuing to allow this to go on unchecked.

Roger Boyes story (worth reading), here.

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Trading P & L Has Nothing To Do With These Economic Oddities

Economics is not science but philosophy. But some philosophies are good, others not.
In evolution we have failures. 99% are. Few survive. The posts below have no meaning but to evaluate why we are so adamant about global trade, low taxes and our independent Ayn Rand sort of libertarianism. And the fools in the media painting pictures of immigrants destruction of America, building walls (on the wrong side it appears...the Canadians are not the economic power Mexico is).
And in listening to CNN yesterday I heard the most absurd question aimed to 15 second congressional soundbites, advertised by drug companies fixing your bladder issues, and bipolar issues (ignoring current research showing over 80% of all known psychiatric and social issues are due to neuron damage from a blow (of any sort) to the head)....and talk about a grant money bonanza, now that this is known, Frued is out, and so are shrinks and in is TBI and brain injury and its questions (as medicine is a bit behind here) how to fix it. 80% of all homeless, 80% of all with "mental illness' and 80% of all addiction from a blow to the head injuring how we think.....nothing to do with our toilet training at all.
The question asked on CNN was "How can Obama possibly deal with what is apparently a tyrannical illegal governement with demonstrations by the people evident, politcal prisones being taken for simple traffic violation as Iran is in the midst of turmoil, how can Obama maintain a dialog?
First, we have done well dealing with dictatorships for the last 40 years when it sutis us, from Noriega, to Pinochet to many African, Mideast (dictatorships we set up as the others) Sadam who we promoted and gave money to fight the evil Ayatollah, and to bin Laden to fight the USSR in Afghanistan....I could name dozens more.
But the funniest is we trade with China.
And Vietnam. But not Cuba.
There is no sense like nonsense.
And our policy for 40 plus years that we have declined is self serving and not pro human or competitive equal ideals, nor in business. Nor in taxation (wait until tomorrow) nor in health as we see those that kicked our ass found the economy of scale not enough, but to become of the view that health and welfare was part of the ifrastructure of the country and its importance with education essential is how we have become so stupid and slow as we are greedy and wish to hold on to what we (as though we earn anything in a vacuum without help) from others taking it.
We are operating out of fear. The other countries out of cooperation to the point of open borders (listening Lou Dobbs) as Mexico is important and if a truck load of crap can be sent accross without tarrif you bet people should be able to cross as well. A Wall? This is not what South America, Asia and Europe, or Africa are doing.
We grow at 15 fold in 40 years vs Europe (and others....do NOT include China) grow at 10 times our growth by sharing costs of their infrastructure (including health, education, welfare, and roads too)? China is one under the question of the Ted Knight commentator on the CNN news....a tyranny, political prisoners, and is it that long since we saw them with tanks agains students ....or Nixon against students...is their a possibility we have flushed our money to a man who opened trade with China, another (Bush I ) as ambassador and his son that openned the flood gates of giving (as it NOT two way ....try, just try to buy a stock in China tomorrow! Let alone start up a company to supply them). But the Europeans have through being tough and sharing costs. We are fools.
Tomorrow a tax lesson that will make you throw up from the misinformation and lies and media nonsense (come on, GE runs a fair balanced newscast? or Disney?)
I am disgusted. So little people know about anything, not due to lack of education, but the type. Our school system of no child left behind like adding a kid in a wheelchair to mainstream him to a bunch of football players telling them they will run patterns and play when the wheelchair kid can. Which is never.
We do not reward nor help those with promise. We let all fall through all cracks to nothing before helping (after which it is too late) and no, we are not born nor are we equal, and sharing risk helps. Health and welfare are the start. In your community you have thousands with loans tied to the libor rate.....well, dont let each other go under....HEDGE IT! Gas got you down? Food costs? HEDGE IT ....as a community.
Never will happen in America. Independence we fought so hard for 300 years ago, does not mean not sharing risk. But we have been lead to believe so.
What fools.
Lets start again and be neighbors, and help. Thats all Europe has done. That is all South America has done, or OPEC style mideast or Far east have done.
They compromise and help and grow. We die holding our love it or leave it signs.
Unreal.
Sell US stocks (again and again and again as I repeat....not due to Obama but the 40 years before him) and buy Brazil and Chile and buy America and their currencies, and if your could buy the Chinese stocks and currencies directly I would say do it. We are the same oligopoly so close to monopoly and communist view China had now there is no diffference. But that we lose. And they win. And buy Europe, it is not overpriced, or as the British and French said on a recent BBC interview ...yes we argue, have differences but prefer not to be rude when the Americans say we are falling apart....we are not, and we will not. ...we know when we have found a valuable manner to exist.......
and sell bonds (the world will) and sell stocks (the world will) and sell dollars (the world will).
We have lower by far to go because of the crap thought on taxes that I will eplain tomorrow, where if you wished to be Chinese you would pay 17% not our 28% (nor the Canadian 33%....replendent with health coverage for all, welfare and funding too)....
and so Kudlow would say just by the rate along to move to China. Hey, Kudlowites, we did best in the 50 through 70 period with 94 down to only 73% progressive tax rates with deductions for moving money (via the public sector ....showing brilliance at times) to where needed. Since we have debt without assets, we have squandered our inheritance.
more tomorrow.
But for those of political mind think that the democrats had 12 years of administrative posture in the last 40. Those of love kindness and sharing had the other 28. And I would not but the Clinton camp with the Republican majority in Senate and House in the democratic caring area. But they worked well against further decline. And wonder, as the veto works, why we are where we are or if republicans are worth living with. Personally anyone thinking the EU socialist with 8 to 22 politcial parties, and an anti trust fostering competition and innovation like no other makes me detest all democrats and republicans (and there is no other vote here...they are crowded out by demanding 5% to 10% of ALL registered voters allow their run, let alone their party....so may both parties be damned for destroying our country. They have. We have the last word though and so tired of blame and nonsense, this is our fault. We fall into lines like we should we dont strike, we buy into words like righ and left and we vote badly and should not be allowed to vote at all.
It diminishes all who died supporting this which is neither freedom nor democracy. Obama show the first hope in 40 years. Lets let him CHANGE as that is what we need.
His quote to the AMA ( union you know) today was great: " the devil we know is berr, than the devil we dont. ..we are all afraid of change".
And better quote yet is from a dictator in Pakistan " When you dont know where you are going, all road takes you there"
We must decide to share, to make it easier on us all, to reach out and form associations with groups (yes which whom me may disagree, but for the greater good)
That is what the 1970 to now GDP shows me. And the projections of our fall.
As Soros said long ago, Bush is sowing chaos, bad for business and bad for America, opening the gates one way for the corporate greed he has given tax cuts to without responsibilty for all, and this will cause the demise of the US as the premier country for freedom and business for all the world. The world has learned and is out doing what ever america can do by sharing......" as said in Move on dot org.
And true.

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