Thursday, July 29, 2010
The spirit of liberty has been corrupted before, but on a local level: Tammany Hall in 19th century New York, Jim Curley in Boston, the Daley machine in Chicago — the political process run by and for bosses. But never before has the political class openly expressed its contempt for the United States as a whole.
Now you see it in its awful glory, taking over corporations, telling banks who they must lend money to, passing bills thousands of pages long that no one has read in their entirety but full of plums for special interests, condoning voter intimidation, refusing to enforce laws and the Constitution whenever they feel like it.
It would not be entirely correct to say that the Failed Messiah wants to subvert the Constitution. He is simply indifferent to it, hardly knows that it exists. His law is street law. He's the leader of the pack. Plenty of followers, as well as collaborators from the opposition party, function as his enablers. And of course the FM is only a more extreme version of his predecessor: Shrub II also didn't like borders, and looked the other way as they became the thinnest gauze; invaded two countries without bothering about the formality of asking Congress for a declaration of war.
Now a federal judge has ruled (in effect) that Washington doesn't have to protect and defend the United States, and that no state can either force it to or step in and take responsibility itself. While the ruling is bad to the point of immorality, the net effect could turn out to be positive. It shows Americans in no uncertain terms that their national government is neither of the people, by the people, nor for the people (aside from the people it has chosen to import for population replacement). If Americans are truly Americans, they will react fiercely but cannily, individually and in association with one another. Big Government is powerful and increasingly intimidating, but it is also stupid and clumsy. It is to be feared, but not as much as it can be taught to fear an aroused citizenry.
Wednesday, July 28, 2010
The leftist media have latched onto a new study to help them promote la Reconquista.
A reduction in crop yields caused by climate change could mean up to 6.7 million additional Mexicans will emigrate to the United States by 2080, says a study by Princeton University researchers.Stories in the Christian Science Monitor, the Biased Broadcasting Corporation, and Reuters can't decide what they're more gleeful about: another bunch of "academic experts" waving the global warming flag, or the prospect of yet more Mexicans overrunning the United States.
A reduction in crop yields caused by global warming could mean up to 6.7 million additional Mexicans will emigrate to the United States by 2080, says a study by Princeton University researchers. The authors say that a 10 percent decline in agricultural productivity would lead two percent of the Mexican population to migrate.
In none of these news propaganda pieces is there so much as a suggestion that the United States doesn't have to accept a new wave of invasion ("human migration"). This faith-based prediction of a heat wave south of the currently borderless border will send more millions of Mexicans to El Norte.
End of story. What, you thought it was possible to stop "migration"? That would make an owl laugh.
"Indeed it looks like the climate change could be an important factor in future migration," said Oppenheimer, a member of the Intergovernmental Panel on Climate Change. "It underscores the need to grapple with greenhouse gases."Oppenheimer, old boy, you go get yourself another grant to grapple with greenhouse gases (commonly known in academic dole-receiving circles as a GGGG). Some of us are going to grapple with another "important factor in future migration": the federal government's policy of population replacement and erasing immigration control.
Oppenheimer stressed that the study did not address the cause of the variation in climate that affected Mexican crops. He also said it did not look at whether the migrants moved to the United States legally.Of course not. He's a Princeton professor. He has his tenure-based sinecure, Party membership in the ruling class, and his dacha in the country. Why should he care if a bunch of border state community college riff-raff have to live in occupied territory? They're probably global warming deniers, to boot. Serves 'em right.
"Yet, to our knowledge, no study has directly associated a component of the increase in emigration with changes in climate, despite numerous reports and anecdotes of Mexican farmers fleeing to the United States because they no longer could maintain their previous way of life because of climate-driven crop failures."Well, Professor Oppenheimer, some of us intend to maintain our previous way of life despite climate-driven patriotism failures like you. You might think about fleeing before the climate gets too hot for you.
Monday, July 26, 2010
James Quinn, writing at Financial Sense, gives an overview of America's economic debacle that we are living through. A lot of it has been said before (and ignored by our political overlords), but Quinn points to one element in the Great Downfall that few of any persuasion want to acknowledge: the role of institutionalized "compassion." Quinn says:
A nation of 310 million people cannot be governed based on emotional sob stories, but this is the tactic used by liberals to enact ever more entitlements and safety nets without consideration of cost. Steven F. Hayward describes the liberal mindset:Compassion is a virtue, but it is a human virtue. Only people can have compassion. Governments cannot have compassion, any more than governments can feel love or tenderness. State institutions exist, by their intrinsic nature, to give their administrators access to the public purse and aggrandize their power. The best the public sector can do for those who need help is provide a safe, orderly, and reasonably efficient framework for individuals to make the most of their abilities, so they will not normally need compassion.
“Liberalism’s irrepressible drive for an ever larger welfare state without limit arises from at least two premises upon which the left no longer reflects: the elevation of compassion to a political principle (albeit with other people’s money) and the erosion of meaningful constitutional limits on government on account of the imperatives of the idea of Progress.”
True, people can suffer through no fault of their own — illness, accidents, the physical deterioration of old age; arguably, even stupidity is a congenital handicap, not a moral quality. A compassionate society (that is, one that encourages individuals to be compassionate) will find ways to help them, and those ways will sometimes involve government institutions.
But that's a far cry from turning every need into, as Hayward says, a political principle. "Compassion" then becomes a trump card, an emotional argument that overrides any other consideration. The Left in particular no longer has to show how any program works in the big picture, rather than just for one group on which the "disadvantaged" label is bestowed.
Emotion based sob stories always overcome rational debate, discussions of cost, and overall impact on society. The problem with making decisions with long term fiscal implications based upon compassion only is that you will run out of money before you run out of compassion. Author William Voegeli points out that there is no end to the liberal compassion-fest:But even that's not the whole story. Mission creep is inseparable from government activity. Ever more client needs must be found — some would say created. The reductio ad absurdum, catastrophic for fiscal (as well as ethical) responsibility, is that everything that would benefit someone becomes a remedy the recipient is entitled to.
"Because compassion is an emotional response rather than a moral principle, it defeats every attempt to make wise choices about which sufferers do and don't deserve governmentally dispensed solace."
For the liberal mentality, it isn't necessary to show that society as a whole would benefit. It isn't even necessary to show that the recipient would benefit in the long run. All that matters is that someone would feel better at this moment. Vote some more largesse! Create a new department to dole it out!
As Quinn says, "The more programs that are created and expanded the larger the constituency for never ending the program. There is no example in the history of the country where a program has been deemed a failure and scrapped. Entitlement programs never die. The current lot of myopic, bought by special interests politicians do not have the guts to cut or even reduce the growth rate of entitlements."
Look at this poor woman. Her day care center's funding has been reduced. It might even have to close. Woe, woe! She has five kids, none of them with a father who found it worth his time to stick around. What will she do with the kids if she can't drop them off at the day care center while she's working at the dollar store?
She's in a fix, all right. But she's in a fix largely because of previous "compassion." No one ever asked her to breed responsibly, or not breed at all until she was in position to raise kids right. Never mind; for the government breedy is needy.
I'm not saying the woman or her kids should be left to their fates without a helping hand. I'm saying we should stop producing situations like this and demanding that others, who may be in better shape because they worked, saved, and planned (and who might have troubles of their own) pay for it.
Perhaps all this wouldn't matter so much, except on moral grounds, if money grew on trees. For some people, especially those in the government ruling class, it has long seemed as if wealth was infinite — one of the few natural resources not needing conservation. But it's mistaken to blame our present end stage economy entirely on government. Not only have the majority of Americans enabled its folly, but they have themselves morphed from citizens into consumers.
The only way for a country to achieve long-term growth is for its citizens to save more than they earn. These savings can then be invested within the country to insure that prosperity would continue for future generations. A country of only consumers will eventually collapse under the weight of debt and lack of investment.There is still time, brothers and sisters. But not much.
Two generations of Americans have been brought up to believe they are owed a pension, owed tax subsidized housing, owed free healthcare and owed the right to happiness provided by Big Brother. The conviction that government can coddle and provide for all the underachievers, disadvantaged and un-ambitious in society has taken root like a weed. This belief is a fallacy.
Friday, July 23, 2010
Most films involving espionage are a branch of the action genre, even when they're not parodies like the James Bond series. At most you get a dash of "love interest," as in Ridley Scott's Body of Lies, for a breathing space between the detonations.
Farewell (titled in French L'Affaire Farewell) is a welcome exception, interested at least as much in personality and politics as in the mechanics of spying. Based on historical events, it is both suspenseful and psychologically powerful.
In the early 198os, a Soviet dissident called Colonel Gregoriev in the film (his real name was Vladimir Vetrov; code name "Farewell") chose to defect in place. He had access to secret documents that he was willing to convey to the West. Being a KGB insider, though, he knew too well that the agency had penetrated its opponents' intelligence ops in Moscow. He needed a foreigner who was squeaky clean with no connection to any spy ring to act as a go-between.
He found just such a person in Pierre, working for the French company Thomson in Moscow. At first unwillingly, and never comfortable with secret meetings and carrying stolen material to his boss in Paris, Pierre proved to be the catalyst for events that reached the highest levels of government. Ultimately, the information obtained by "Farewell" and smuggled by Pierre not only enabled the French to roll up Moscow's network in Paris, but provided Ronald Reagan with evidence of the Soviet government's weakness. According to the film, this knowledge gave Reagan an edge in the Cold War: with a military build-up and the threat of the "Star Wars" anti-missile defense, the United States forced the Soviet Union into a new chapter of the arms race that bankrupted it and led to its downfall.
Gregoriev/"Farewell" and Pierre, interestingly, are both played by film directors. Emir Kusturica (Gregoriev) has made lots of movies, albeit few have had a U.S. release; some 20 years ago, I reviewed his Time of the Gypsies for the Santa Fe weekly paper. All I can recall is that I thought it was imaginative. Guillaume Canet (Pierre), in addition to an acting career, directed the excellent 2006 mystery thriller Tell No One.
Kusturica, a first-rate actor, turns out to be revelatory as Gregoriev. He has terrific screen presence and creates a complex, heroic but humanly fallible character — a man who has taken a step he knows he can never go back from, giving him a slow-burning intensity. Canet was a problem for me at first. He plays Pierre as emotionally closed, precise and formal. He probably designed the performance for maximum contrast with Gregoriev. Pierre's repression is convincing, but dramatically his first scenes are numbingly inert.
Yet, while staying in character, Canet gradually lets us in on a little of Pierre's emotional life. He is lovingly committed to his wife and children, and some of his granite demeanor is because of fear, knowing that he is endangering them. And — although we don't find out why — we see that Pierre is drawn to the secret world, continuing as a conduit between Gregoriev and Pierre's masters in Paris (who now include the French president, Mitterand) when, despite pressure to carry on with the business, he could have shut the door.
Ironies abound. Gregoriev isn't anti-Communist, he's an ultra-believer in the worker's paradise, which he thinks the post-Leninist leadership has corrupted and sabotaged. His wife Natasha is having an affair with another KGB agent — who later turns out to be his interrogator. His son doesn't give a toot for politics, and sullenly lurks in his room listening to the rock band Queen. Gregoriev too has a side dish, an attractive KGB functionary named Alina. There are further ironies, but to reveal them would be a spoiler.
Director Christian Carion's previous film was Merry Christmas, about the temporary fraternization of German and French soldiers on the front lines during the holiday in 1914. I found it to be an impeccably made snoozer, with an obvious story line. No such problems here. The plotting is as suspenseful as it should be, with a few "Hitchcock moments" for extra electricity, and the performances Carion obtained from his actors are spot-on: not only Kusturica and Canet (and it cannot have been very comfortable directing other directors), but also Ingeborga Dapkunaite as Natasha, Alexandra Maria Lara as Pierre's wife, and Dina Korzun as Alina.
Fred Ward's portrayal of Reagan is notable — he makes the Gipper's vocal inflections, phrasing, and even the tone of the voice uncannily accurate, without exaggeration or caricature. Even Willem Dafoe, whom I don't care for as an actor, offers just the right blend of bureaucratic patriotism and smarmy cant as a CIA officer.
Production values are terrific. The settings are convincing, including Ukraine and Finland for Russia; the musical score is spare but effective; and the sound recording and mixing are as good as I've ever heard in a film, providing ambience rather than artificial excitement. But the technical virtues would not have gone for much without its insight into the characters' inner drama. Farewell should take its place among the finest espionage films ever made.
Disclosure: I received a DVD "screener" from the public relations company for Farewell's U.S. release.
Wednesday, July 21, 2010
In a 1976 paper, psychical researcher Erlandur Haraldsson reported on the findings of a survey he conducted in Iceland about belief in survival after death. He found that belief in survival increased with age in his sample.
Among people in their 30s, 10 percent did not expect survival; 20 percent considered it a possibility; and 62 percent expected it. Among people in their 60s, the percentages were 1, 7, and 77 respectively. (In both categories, some expressed no opinion.)
We can't read too much into these results. Iceland is not a proxy for the world, possibly not even for the Western world. That study was a long time ago in sociological terms. In the intervening years scientific materialism has become still more dominant. Atheism is now militant, to the point of putting adverts on the sides of buses. Probably, among respondents in their 30s, something like half would express disbelief or skepticism today.
What about older people, those in their 60s, say? The number of those expecting an afterlife has probably declined somewhat, but I doubt it would be as great as in the younger cohort. If so, some of the difference could be explained by cultural background. The older group originally formed their views at a time when religious belief — which usually includes expectation of some sort of postmortem life — was still a strong influence in most societies.
Such factors can't be entirely ruled out. But others are worth considering. Unless they are victims of a life-threatening disease, young people don't think much about dying. It's theoretical. Something that happens to other people, mainly old people. The young are still busy soaking up the phenomena of this world and are usually in thrall to material goods, sense pleasures, and excitement.
Add to that the technological fundamentalism that marketers and the mass media promote, and it's no surprise the relatively youthful don't pay a lot of mind to questions of after-death survival.
Thinking back to my own late teens and 20s, I remember being an assertive opponent of organized religion, to the point of baiting college professors whom I knew were believers. But was I an atheist? I draw a blank. Probably not really a hard-core atheist, but confused by so many notions of God plus no direct evidence of God's existence or influence, that I just stored the question in a mental attic, to be retrieved or discarded one day.
Two of my grandparents died when I was aged nine. I remember being told about them dying, and feeling a loss, but it was as if they'd moved away. I couldn't conceive of any existential meaning to the events.
Over the age of 60, most people have known several friends and relatives who have passed on. Their own health may have begun to deteriorate. They can no longer deny that they are running out the clock. Death is now real — "that distinguished thing," as Henry James called it.
Materialists could put the greater degree of afterlife belief among older people down to early-life teachings or "indoctrination." They could add that as people get older and their passing looms before them, fear of death causes them to fantasize about heavenly pastures awaiting.
But the evidence points otherwise. And one of the people who collected evidence for survival is that same Haraldsson mentioned earlier. He and his colleague Karlis Osis interviewed hundreds of doctors and nurses in the United States and India (the latter to see what differences cultural background would make) who had been with patients who were on the verge of death.
In an astounding number of instances, patients who had only a few hours to live — as well as a few who recovered — reported visions of an afterlife. The findings were published in At the Hour of Death.
This was a very sophisticated study. The scientists cross-tabulated the results across U.S. and Indian populations; closely questioned the doctors and nurses about possible confounding factors such as the influence of drugs or diseases that could cause hallucinations; calculated whether results were statistically significant.
They examined the kinds of visions the dying saw: often relatives who had passed on earlier, and religious or spiritual figures — both types of which tended to announce their mission as bringing the patient into the next world.
After examining all the evidence, Haraldsson and Osis concluded that it was consistent with the afterlife hypothesis, and could not by any rational criteria be explained away in the majority of cases by wish-fulfillment fantasies or brain damage. They suggested that the dying develop a form of extrasensory perception of the afterlife that helps them make the transition to it.
Around the same time, Raymond Moody presented the phenomena of near-death experiences in Life After Life and subsequent books. NDEs are similar in many ways to the visions of the dying. Since then, much more evidence has accumulated, along the same lines as Haraldsson and Osis and Moody.
I am reasonably convinced that beginning to connect psychically with the afterlife is typical of advancing years. Like so much ESP, it isn't necessarily dramatic or even conscious; but it's enough to gradually change people in the second half of earthly life in their attitudes about the Great Mystery.
Monday, July 19, 2010
Witch hunters are busy in Africa. Their prey: children.
From the BBC: "An increasing number of children are being accused of witchcraft in parts of Africa, the UN children's agency says.
A new Unicef report warns that children accused of being witches - some as young as eight - have been been burned, beaten and even killed as punishment. The belief that a child could be a witch is a relatively modern development, researchers say. Until 10-20 years ago, it was women and the elderly who tended to be accused. …Well, thank goodness for that! Can't have outsiders interfering with tribal customs! That would bring to mind the horrors of imperialism.
The agency said there was little it could do about the belief in witchcraft itself, and that it was not trying to eradicate the practice.
But it said violence against children was wrong, and that it would do everything it could to stop it.How sensitive. Africans who accuse people of witchcraft, well, that's their tradition, who are we to say, impose our value judgments, etc., etc. But anybody who'd accuse a child of being a witch might spank a child as well. It's a slippery slope.
Most of those accused of witchcraft are boys aged between eight to 14 - who often end up being attacked, tortured and sometimes killed. Also, children have had petrol poured into their eyes or ears as a way of trying to exorcise "evil spirits" that healers believe have possessed them.Meanwhile, the Tea Party — Tea Partyers? I'm never sure how to refer to them — have entered the exorcism contest.
Tea Party federation expels group over racial writingNational Tea Party Federation? Tea Party Express?
WASHINGTON — The Tea Party political movement saw a major split over the weekend, with the National Tea Party Federation expelling a member group after its spokesman wrote an online post satirizing a fictional letter from what he called "Colored People" to President Abraham Lincoln.
On its website, the federation stated it had given the Tea Party Express, through direct contact with one of its leaders, a deadline to rebuke and remove spokesman Mark Williams.
"That leader's response was clear: they have no intention of taking the action we required for their group to continue as a member of the National Tea Party Federation," the federation stated. Therefore, effective immediately the National Tea Party Federation is expelling Tea Party Express from the ranks of our membership."
Williams, who said his letter was satirical, started it like this: "Dear Mr. Lincoln, We Coloreds have taken a vote and decided that we don't cotton to that whole emancipation thing. Freedom means having to work for real, think for ourselves, and take consequences along with the rewards. That is just far too much to ask of us Colored People and we demand that it stop!"I am not about to defend this. It's crude and doesn't even work as satire. Williams may have some kind of point, but if so, this is no way to express it.
However, it is distressing that the Tea Party Federation has reacted by excommunicating him and his group. It is distressing, in fact, that there is a "National Tea Party Federation." The Tea Party was supposed to be a true grassroots phenomenon, determined to avoid the perils of "leaders" and sectarianism. Its strength was to be decentralization.
I've been cautiously — very cautiously — optimistic about the Tea Party movement. Cautious because to do any good it would have to get past two great pitfalls.
The first was being co-opted by the Republican Party's Old Guard who would adopt some of the language of the Tea Party to reel in their votes. So far that doesn't seem to have happened, and I'm impressed by the good sense the rebels have shown.
The second danger was exactly what does seem to be happening: going defensive at the inevitable accusations of racism, the R-bomb the Left releases (usually with devastating effect) on its opponents as a matter of routine. The Tea Partyers should have seen this coming and had a counter-strategy: simple denial. Instead, they have put themselves on trial.
It's the same old surrender that has dogged American conservatism for years: trying to fight the corrupt and ruthless Left while accepting the Left's categories. NAACP says you've racism in your ranks? Quick, crank up the show trials! Start the purges! Expel the deviationists. Down with the Tea Party Trotskyists.
This "national federation" seems to believe there's little it can do about the belief in its racism, and is not trying to eradicate the practice. But it will protect its children who cannot stand up to bullying.
July 20: What did I tell you?
The National Tea Party Federation didn't buy itself any goodwill by kicking out this Williams dimwit. According to Eugene Robinson, writing in the supposedly conservative Real Clear Politics:
WASHINGTON -- That was quick. We now have proof the NAACP was right.
When the nation's leading civil rights organization passed a resolution condemning displays of racism by tea party activists, leaders of the movement reacted with umbrage so thick you could cut it with a knife -- then demonstrated that the NAACP's allegation was entirely justified.
The Tea Partyers have now scored a big goal — against themselves. How many more anathemas will be pronounced against people in the movement who don't follow the political correctness style book? How many Tea Party "leaders" will take it on themselves to kneel in the snow outside NAACP headquarters or Jesse Jackson's office to plead forgiveness?
There should be no central Tea Party Politburo deciding who is and isn't on the team. The response to any racial Mafia that questions the Tea Party's bona fides should be, "This is a movement composed of individuals. We understand that the concept of individuals is puzzling to you, since you believe in group rights and authoritarian organization. However, people in our corner speak for themselves. We don't tell anyone what they can and can't say. If individuals offend you or anyone, that's their own problem, or maybe you have a problem. Now back off."
The National Tea Party Federation (whatever that is) has swallowed the bait and taken a no-win position. I'm ashamed of them. Many Tea Partyers are good people who want to restore a constitutional republic in this country, but it seems they now have self-appointed leaders subverting them. That's the trouble with "leaders."
Friday, July 16, 2010
How do you prove you are not a racist? I, my husband, and several members of my family have attended several Tea Party events and rallies, including a rally of over 100,000 in Washington, D.C. last September. According to the NAACP, and many members of the Democrat party establishment, my family and I are either racists ourselves, or we are tacitly supporting and enabling other racists in the Tea Party. So how do we defend our honor?Yes, I remember that rally. I was there too.
Is it proof that I am not racist that I served for several years as a literacy tutor in the African-American community in Columbia, SC? Is it proof that I am not a racist that my family attends a Baptist church in Wendell that has members of multiple races? Is it proof that I am not a racist when my family co-sponsored a black mother and her two children at Christmas last year and that my white son chose all the toys and clothes for her black son based on their common love for all things Bakugan and sports? Is it proof that we are not racist that we invite our Hispanic employee and his wife to join us on our family vacation at the beach? Or how about that my family includes members of several races on the approved NAACP list, and that I have close relationships with those family members?Deanna, Deanna. Please.
As college professors, think tank boffins, and other puffed-up intellectuals like to say: "You're asking the wrong question."
You can't prove to the NAACP, or at least to the microphone grabbers among them, that you're not a racist. You are foolish to try. Foolish. If that sounds harsh, I'm sorry. But if you call yourself a Tea Partyer, you are letting the side down. You're allowing your accusers play you for a sucker.
It's not just that you are falling into the trap of trying to prove a negative, which except in cases of specific, observable facts is philosophically impossible. I can't prove I am not thinking of robbing the Bank of England. I can't prove that these words are not being put into my brain by extraterrestrials in the fourth galaxy down the street. The burden of proof should be on your accusers, Deanna, and you are taking it on yourself.
But that's the least of it. You accept that the NAACP has a case for you to answer, and you try to fend off criticism by citing all sorts of activities you've done for and with minorities. Do you seriously think that lets you off the hook? "You're just doing those things out of guilt! You want to deny your unconscious racism so you make pets of a few persons of color!"
So the answer to your question — your wrong question — is, you can't prove you're not a racist. And you shouldn't try.
When you hand the racial grievance squadron at NAACP a list trying to prove your bona fides, you are letting them set the rules of discussion. You're acknowledging their right to call you a racist with no evidence. You're trying to placate them, as though they were rational people, and you will inevitably fail at something that can't be done.
Frankly, Deanna, when you offer pathetic defenses like, "Is it proof that we are not racist that we invite our Hispanic employee and his wife to join us on our family vacation at the beach?" then I don't have a lot of time for you. You think you are defending the honor of the rest of us who marched on Washington, while you are selling us out.
There are only two ways to respond to race hustlers like NAACP spokespeople (I'd like to believe that not all NAACP members are so vicious). The easiest is to ignore them. Or if you must, reply with a simple, "You're mistaken."
Because when you go into your riff about tutoring the African-American community and all the rest, you are protesting too much. You sound guilty as charged. Why else would you do back flips to deny it? As the French say, "Qui s'excuse, s'accuse."
The other way you can spike the NAACP's cannons is to say, "Yes, I'm a racist. You're a racist. Fred Flinders, my friend in Indianapolis, is a racist. Pere Ubu in Kenya is a racist. Raoul Chemin de Fer in Lucerne is a racist. Shall I go on, or are you satisfied?"
Deanna, did you ever see the film Spartacus, about the leader of a slave revolt in ancient Rome? There is a scene where, if I recall right, the Roman consul Crassus and his legion have captured Spartacus's army. Crassus asks: "Which of you is Spartacus?"
"I am Spatacus!" "I am Spartacus!" Pretty soon the whole lot are shouting, "I am Spartacus!"
Accusations of racism are already becoming a joke among many of us, but certain leftists are slow to get the joke. Imagine if every time one of them plays the race card, we all said simultaneously, "I'm a racist!" And laughed.
I'm an "unconscious racist." Those quotation marks, NAACP, indicate sarcasm and the contempt you deserve. Unfounded accusations of racism are the last refuge of scoundrels.
Thursday, July 15, 2010
I don't want to run this subject into the ground, but given the heavy seas the American economy is almost guaranteed to experience in upcoming years, the question of how (or whether) to invest in gold is important. Rightly or wrongly, many people believe that gold is the investment you can count on when the going gets rough, or that its price is headed to the moon, or both.
At the Financial Sense Web site, Erik Townsend discusses various ways to own gold, including through the GLD exchange traded fund that we beat up in the last posting. The author's bio note only describes him as "a private investor based in Hong Kong," or in other words, a bloke trying to make money in the markets. Then again, he doesn't appear to be a fund manager writing to lure clients, which is a good sign.
His article is long-winded and repetitious, but seems intelligent. I think he makes a good case for the important distinction, whose significance I hadn't fully comprehended, between owning allocated and unallocated physical gold. We won't get into that here; read his article and he'll tell you about it. Several times.
Townsend also has his say about GLD, and while he doesn't recommend using the ETF as a hedge against catastrophe, he believes it's useful as a trading vehicle. And he finds most of the fears about GLD's integrity mistaken or overblown.
In my opinion, the GLD ETF represents a far more sound investment than an unallocated bullion bank account, although neither will help you in a true crisis (where an allocated account will).He then cites a section from the Authorized Participant Agreement, which presumably sets forth the legal status of the gold in the vaults.
Most ETFs, including the GLD, supposedly have all the gold to back all the shares. (There are some gold ETFs that do not use physical gold backing, but these are few and small.) Critics have argued that some of the ETF custodians could be leasing out some of the gold owned by the ETF, and thus there might be multiple ownership claims on the same bullion.
There is no evidence that any of the major ETFs offered by money center financial institutions do this. The criticism is limited to speculation by others — usually people with a vested interest in discrediting the ETFs — that such shenanigans could be going on.
Another claim made by critics is that the gold in the ETF was itself actually leased from a central bank so the ETF doesn’t really have clear title to the metal. Again, there is absolutely no evidence that this in fact is the case. Frankly, I think these allegations amount to fear mongering on the part of critics who have a financial incentive to scare investors away from the ETFs in favor of other products being sold by those same critics or their associates.
I am not a lawyer and I’m not qualified to give legal advice, but that language seems pretty darn clear to me. The authorized participants (who create GLD shares by depositing gold) have to deliver clear, “unencumbered” title to the gold. Could other parties also have a claim on that same gold? This language is pretty clear in saying that liens, security interests, claims, options, etc. are all prohibited. Clear, unencumbered title to the gold must be transferred to the trust when an Authorized Participant creates new GLD shares. Period.Moreover, he says, the gold holdings are audited at least annually.
Could the auditors be fooled and miss something? Yes. That would not be unheard of. However, there are layer upon layer of safeguards to prevent this, so if an authorized participant has defrauded the ETF manager, they also have the trust’s auditors fooled.So, who is right — GLD's detractors (including the one quoted at length yesterday) or Townsend? Don't look at me. You pays your money and you takes your choice. Or not.
Wednesday, July 14, 2010
It's not only now acceptable to invest in gold, it's fashionable. It's not only fashionable, it's necessary in the view of many financial commentators (not to mention marketers and pitchmen whose income derives from hyping the metal).
Gold investing got a rocket booster with the advent of gold exchange-traded funds, or ETFs, the most popular of which is the SPDR Gold Trust, ticker symbol GLD. The ETF says that it holds actual gold bars in HSBC bank vaults, on which GLD ownership represents a claim. At the end of last year, GLD's assets were worth more than US$40 billion.
It seems like a godsend for the small investor (under 5 feet 7 inches) who finds it inconvenient and expensive to keep gold coins and bars around the hacienda. Buy shares in GLD and the fund managers take care of the practical side, and you just rake in the profits as world economies blow up or inflate madly, and the price of gold reaches for the sky.
As in most investing, however, risks that seem negligible take center stage and do a fan dance once your money is on the table.
For months now, there have been rumors about GLD, principally variations on the possibility that with so much gold bullion being owned by the ETF, it has been necessary to stow some with sub-custodians who are not too bothered with the niceties of inventory management. Stories have made it into print that gold bars have been discovered (not under GLD management) that comprised tungsten ($10 an ounce) with a gold veneer, tungsten having the same molecular weight as gold, so that if you weighed a tungsten "gold" bar it would seem authentic.
I dismissed these rumors and anecdotes at first as just the kind of stories people like to tell. When they didn't fade away and seemed to grow in volume, I started to take them more seriously. My reasoning was this: while the odds are that GLD is and does exactly what it says, if some fiddling were going on and it became public, the value of GLD shares would sell off instantly to near zero, even if gold bullion kept zooming up. Worth the risk? I decided to sell my GLD holdings for a reasonable profit while I could.
Last week, a reputable source — TheStreet.com — published a story titled "7 Reasons Not to Buy GLD." The writer, a lawyer named Jeff Nielson, is affiliated with something called Bullion Bulls Canada, which suggests he might have a vested interest in trashing the ETF. But that TheStreet.com would run the piece makes me think it's at least reasonably credible. Nielson makes interesting points, sometimes amusingly. Here are a few excerpts:
… If this fund were really the simple "trust" that it pretends to be, it would have been very easy for the sponsor to say that the objective of the Trust was to provide "a cost-effective investment in gold" for unit-holders, but the fund deliberately avoids any such language. Instead, it defines the Trust's investment objective as merely to "reflect the performance of the price of gold bullion."What's wrong with saying that the sponsor only believes that the shares are a cost-effective way to invest in gold? Especially when further hedged by "for many investors"? All prospectuses are full of lawyer-minted weasel wording. But Nielson continues:
It then immediately goes on to say:
"The Sponsor believes [emphasis mine] that, for many investors, the Shares represent a cost-effective investment in gold."
The choice of wording here is enormously important, given that in a preceding page of the prospectus, the word "believe" is expressly designated as a "forward-looking statement."It then says that with respect to all such "forward-looking statements" that: "They are only predictions. Actual events or results may differ materially."
The only "warranty" that the sponsor has chosen to provide (i.e., the "investment objective") is that the fund will "reflect the performance of the price of gold bullion." Whether or not there is (actually) any gold in this fund is merely a "belief" of the sponsor and thus may not be relied upon by unit-holders.Although he acknowledges that the example sounds absurd, Nielson gives his lawyer's view of another aspect of the prospectus: "I have warned unit-holders that if there were some fraud or default associated with the fund, that all that unit-holders would ever be able to recover from the fund is paper. In other words, they could sue to get their (paper) money back, but they could never sue to force the sponsor (and/or 'custodian') to provide them with the gold they thought they had bought." If I understand him, he is saying that if, after a fraud was discovered, the GLD share price fell to 5 cents, you could only get back the number of shares you own times 5 cents.
To provide a hypothetical example, suppose that the "custodian" for the fund (HSBC) has done extensive research and found that the price of chickens tends to be almost precisely correlated with the price of gold (i.e., they closely track each other). Given that HSBC has other things it would like to do with its gold (such as dumping bullion onto the market, or backing its massive short position), it decides that instead of going to all the bother of acquiring and storing such a massive quantity of gold that it will buy and hold chickens instead.
While much bulkier than gold, the "storage costs" associated with stationing a sleepy, security guard outside the freezers of a few meat-packers certainly cannot compare with the overhead of managing a bullion-vault capable of storing billions of dollars worth of bullion, not to mention the logistical costs associated with transporting (and insuring) all the bullion being bought and sold by this massive fund.
Not only does the document seek the normal waiver with respect to acts of God, war, or terrorism, but it also seeks to indemnify both the sponsor and custodian from fraud, negligence, or willful default.
Specifically, even under the worst acts of malfeasance, investors could never recover anything other than the market value of their holdings (i.e. paper money) as of the day the fraud was discovered, or default occurred. While (to some extent) language like this is common in such legal documents, we must attach considerable importance to the deliberate choice of the words "willful default," rather than just the generic term "default" -- which most reasonable readers would assume would imply some involuntary event.
Instead, if HSBC defaults on its custodian agreement, and even if it actually did have enough gold currently in its possession to cover its obligation, it could simply refuse to turn over the gold it held. Suddenly, my example of the hypothetical chickens doesn't sound quite so preposterous. In the event of a willful default, it could liquidate its chickens to cover its custodian agreement, keep all its gold -- and unit-holders could do nothing.
Those are only the first two of Nielson's seven reasons to stay away from GLD. I am not qualified either to endorse or refute his arguments. However, if you own or are considering owning a significant position in the ETF, I recommend you read the article and perform your own due diligence.
Gold pills: take as directed.
Gold Mac PowerBook.
And of course you'll want a couple of gold flash drives.
You may or may not want to park a gold Mercedes in your driveway,
depending on your neighborhood.
"Face" it, ladies. You've dreamed of this …
Saturday, July 10, 2010
Weight Loss Festival
Slough, Berkshire, England
How tiresomely conventional -- the rich, globalist liberal's Eiffel Tower and Blarney Stone. However, my research has brought to light great trips that even the Journal piece's writer, Anne Tergesen, has never heard of. Probably.
Cat Comedy Days. Cheshire, Connecticut. Participants enjoy champagne and oysters, then are escorted in an elegant former hearse to animal shelters throughout the region. During these visits they are encouraged to entertain stray cats, with a special mystery prize awarded to any participant who can, in the proverbial phrase, "make a cat laugh."
Folk Song Festival. Square Top Mountain, Tennessee. This traditional festival, little known to outsiders, takes place annually in a remote location at the end of a 50-mile dirt road. Certified Folks compete in singing "Ninety-nine Bottles of Beer on the Wall." Tour guests are encouraged to participate. The winner's prize is ... okay, I know you can guess.
Jungle Entomology Tour. Hastings-on-Amazon, Brazil. Join us as we discover the thrilling world of exotic insects far beyond civilization. View these remarkable creatures before Global Warming does them in. No telling who will show up, but if we're lucky, we will spot a Stilt-Legged Weevil; a Manaus Seersucker; a Yellow-headed Siren Beetle, which imitates the sound of a police beetle, pulls its prey over, and devours it; a Topographical Butterfly, whose protective coloration includes wings that simulate a map of Cleveland; and a Deadly Boring Beetle, with a power drill in its abdomen.
Up and Down Tour. Mount Ulalume, Nepal. Your faculty lounge colleagues have done Mount Everest, of course, but can they beat this? Along with your tour group, you will climb to the summit of 19,344-foot Mount Ulalume, and then -- are you ready for this? -- descend a 19,344-foot shaft to sea level. For those who make it back up again and down to the luxurious Waki Lodge, it will be an unforgettable experience.
Weight Loss Festival. Slough, England. Watch obese contestants as they compete to lose the most weight in three days, accompanied by a world champion Elvis impersonator singing "Return to Slender." Last year's weight loss winner was Ethelred Floss, 46, who began the festival tipping his cab driver -- pardon, tipping the scales -- at 288 pounds. At the conclusion of the event, judges were unable to locate him until one had the good sense to bring a magnifying glass, whereupon Floss was awarded a miniature trophy cup using a pair of tweezers.
If you have exhausted the possibilities of conventional unconventional holidays, there is simply no reason to stay home and watch American Idol!
Friday, July 09, 2010
In other news …
(07-08) 23:33 PDT OAKLAND -- There was outrage, there was looting and there were skirmishes between police and protesters, but that wasn't the whole story of how Oakland reacted to the Johannes Mehserle verdict. …
Sporadic conflicts were quelled quickly early in the evening, but by late night at least 50 people - and maybe as many as 100 - had been arrested as small groups smashed windows, looted businesses and set trash bins on fire.
The violence was contained for much of the early evening within a one-block area near City Hall by an army of police officers in riot gear, but around 10 p.m. a knot of rioters broke loose and headed north on Broadway toward 22nd Street with police in pursuit. They smashed windows of shops including the trendy Ozumo restaurant, and one building was spray painted with the words, "Say no to work. Say yes to looting."
They were in blackface? Racists!!!!!!
One group tore through the metal gate protecting a Footlocker shoe store on Broadway near 14th Street, shattered a window and emptied the shelves. Soon there were shoe boxes on the street.
Afterward, the group moved across the street and smashed a window at the Far East National Bank building and rampaged inside. Graffiti was sprayed on the bank wall reading "Riot for Oscar." Up and down Broadway within the police lines, skirmishes broke out between officers and small groups of protesters, some wearing black face paint.