The Real Numbers:

Published: March 01, 2010

December 2, 2009
Economy and Financial System Face Eventual Great Collapse
Government and Fed Actions Have Narrowed Timing for

Hyperinflationary Great Depression to Next Five Years
High Risk of Ultimate Dollar Crisis Unfolding in Year Ahead

Please Note: Given less than one month before the New Year and the possible breaking of the hyperinflation crisis in the year ahead, I have entitled this "Update 2010." The report is intended to replace the Hyperinflation Special Report of April 8, 2008, which was published post-Bear Stearns but pre-Lehman, pre-TARP, pre-recession recognition and pre-2008 election. Nonetheless, the outlook has changed little. In turn, the April 2008 report updated and expanded upon the three-part Hyperinflation Series that began with the December 2006 SGS Newsletter.

The new missive includes much of the text in the prior edition, with revisions and updates reflecting the still-unfolding economic and systemic solvency crises, and it expands upon some areas touched upon in the previous report. SGS Special Reports published subsequent to April 2008 have supplemented the hyperinflation story and are incorporated by reference in this update: Money Supply Special Report (August 3, 2008), Depression Special Report (August 1, 2009), Consumer Liquidity Special Report (September 14, 2009).


A Great Collapse. The U.S. economic and systemic solvency crises of the last two years are just precursors to a Great Collapse: a hyperinflationary great depression. Such will reflect a complete collapse in the purchasing power of the U.S. dollar, a collapse in the normal stream of U.S. commercial and economic activity, a collapse in the U.S. financial system as we know it, and a likely realignment of the U.S. political environment. The current U.S. financial markets, financial system and economy remain highly unstable and vulnerable to unexpected shocks. The Federal Reserve is dedicated to preventing deflation, to debasing the U.S. dollar. The results of those efforts are being seen in tentative selling pressures against the U.S. currency and in the rallying price of gold.

Crises Brewed by Federal Government and Federal Reserve Malfeasance. The crises have been generated out of and are centered on the United States financial system, triggered by the collapse of debt excesses actively encouraged by the Greenspan Federal Reserve. Recognizing that the U.S. economy was sagging under the weight of structural changes created by government trade, regulatory and social policies — policies that limited real consumer income growth — Mr. Greenspan played along with the political and banking systems. He made policy decisions to steal economic activity from the future, fueling economic growth of the last decade largely through debt expansion.

The Greenspan Fed pushed for ever-greater systemic leverage, including the happy acceptance of new financial products, which included instruments of mis-packaged lending risks, designed for consumption by global entities that openly did not understand the nature of the risks being taken. Complicit in this broad malfeasance was the U.S. government, including both major political parties in successive Administrations and Congresses.

As with consumers, the federal government could not make ends meet while appeasing that portion of the electorate that could be kept docile by ever-expanding government programs and increasing government spending. The solution was ever-expanding federal debt and deficits.

Purportedly, it was Arthur Burns, Fed Chairman under Richard Nixon, who first offered the advice that helped to guide Alan Greenspan and a number of Administrations. The gist of the wisdom imparted was that if you ran into problems, you could ignore the budget deficit and the dollar. Ignoring them did not matter, because doing so would not cost you any votes.

Back in 2005, I raised the issue of a then-inevitable U.S. hyperinflation with an advisor to both the Bush Administration and Fed Chairman Greenspan. I was told simply that "It’s too far into the future to worry about."

Indeed, pushing the big problems into the future appears to have been the working strategy for both the Fed and recent Administrations. Yet, the U.S. dollar and the budget deficit do matter, and the future is at hand. The day of ultimate financial reckoning has arrived, and it is playing out.

Saving the System at Any Cost. The Federal Reserve and the U.S. Treasury moved early in the current solvency crisis to prevent a collapse of the banking system, at any cost. It was the collapse of the banking system and loss of depositor assets in the early-1930s that intensified the Great Depression and its attendant deflation. A somewhat parallel risk was envisioned in 2008 as the system passed over the brink. The decision was made to avoid a deflationary great depression.

Effective financial impairments and at least partial nationalizations or orchestrated bailouts/takeovers resulted for institutions such as Bear Stearns, Citigroup, Washington Mutual, AIG, General Motors, Chrysler, Fannie Mae and Freddie Mac, along with a number of further troubled financial institutions. The Fed moved to provide whatever systemic liquidity would be needed, while the federal government moved to finance corporate bailouts and to introduce significant stimulus spending.

Curiously, though, the Fed and the Treasury let Lehman Brothers fail outright, which triggered a foreseeable run on the system and markedly intensified the systemic solvency crisis in September 2008. Whether someone was trying to play political games, with the public and Congress increasingly raising questions of moral hazard issues, or whether the U.S. financial wizards missed what would happen or simply moved to bring the crisis to a head, remains to be seen.

In the midst of the crises, the Obama Administration has introduced major new government programs, ranging from carbon tax plans to a national health care and insurance program. Irrespective of any stated goals of not increasing the federal deficit further, these programs will have severely negative impact on the federal deficit, either from massive net expenses, or from losses in tax revenues in a weaker economy. The various initiatives generally will act as major depressants on business activity. The U.S. Treasury has delayed publishing the U.S. Government’s 2009 GAAP-based financial statements for two months, until February 2010. With my estimate of a GAAP-based 2009 annual deficit of roughly $9 trillion, there may some method in pushing off unhappy accounting until after the health-care package is resolved.

While the system will be saved at any cost, and the government will spend whatever it can spend until the financial markets rebel, the ultimate cost here will be in inflation and the increasing debasement of the purchasing power of the U.S. Dollar.

Hyperinflation Nears. Before the systemic solvency crisis began to unfold in 2007, the U.S. government already had condemned the U.S. dollar to a hyperinflationary grave by taking on debt and obligations that never could be covered through raising taxes and/or by severely slashing government spending that had become politically untouchable. The U.S. economy also already had entered a severe structural downturn, which helped to trigger the systemic solvency crisis.

The intensifying economic and solvency crises, and the responses to both by the U.S. government and the Federal Reserve in the last two years, have exacerbated the government’s solvency issues and moved forward my timing estimation for the hyperinflation to the next five years, from the 2010 to 2018 timing range estimated in the prior report. The U.S. government and Federal Reserve already have committed the system to this course through the easy politics of a bottomless pocketbook, the servicing of big-moneyed special interests, gross mismanagement, and a deliberate and ongoing effort to debase the U.S. currency. Accordingly, risks are particularly high of the hyperinflation crisis breaking within the next year.

Numerous foreign governments have offered unusually blunt criticism of U.S. fiscal and Federal Reserve policies in the last year. Both private and official demand for U.S. Treasuries increasingly is unenthusiastic. Looming with uncertain timing is a panicked dollar dumping and dumping of dollar-denominated paper assets. Such is the most likely event to trigger the onset of hyperinflation in the year ahead.

The U.S. has no way of avoiding a financial Armageddon. Bankrupt sovereign states most commonly use the currency printing press as a solution to not having enough money to cover obligations. The alternative would be for the U.S. to renege on its existing debt and obligations, a solution for modern sovereign states rarely seen outside of governments overthrown in revolution, and a solution with no happier ending than simply printing the needed money. With the creation of massive amounts of new fiat dollars (not backed by gold or silver) will come the eventual destruction of the value of the U.S. dollar and related dollar-denominated paper assets.

What lies ahead will be extremely difficult, painful and unhappy times for many in the United States. The functioning and adaptation of the U.S. economy and financial markets to a hyperinflation likely would be particularly disruptive. Trouble could range from turmoil in the food distribution chain to electronic cash and credit systems unable to handle rapidly changing circumstances. The situation quickly would devolve from a deepening depression, to an intensifying hyperinflationary great depression.

While the economic difficulties would have global impact, the initial hyperinflation should be largely a U.S. problem, albeit with major implications for the global currency system. For those living in the United States, long-range strategies should look to assure safety and survival, which from a financial standpoint means preserving wealth and assets. Also directly impacted, of course, are those holding or dependent upon U.S. dollars or dollar-denominated assets, and those living in "dollarized" countries.

The balance of this special report is broken into the following sections:

  • Defining the Components of a Hyperinflationary Great Depression

  • Two Examples of Hyperinflation

  • Current Economic and Inflation Conditions in the United States

  • Historical U.S. Inflation: Why Hyperinflation Instead of Deflation

  • U.S. Government Cannot Cover Existing Obligations

  • Hyperinflationary Great Depression

  • Closing Comments

Defining the Components of a Hyperinflationary Great Depression
Deflation, Inflation and Hyperinflation. Inflation broadly is defined in terms of a rise in general prices due to an increase in the amount of money in circulation. The inflation/deflation issues defined and discussed here are as applied to goods and services, not to the pricing of financial assets.

In terms of hyperinflation, there have been a variety of definitions used over time. The circumstance envisioned ahead is not one of double- or triple- digit annual inflation, but more along the lines of seven- to 10-digit inflation seen in other circumstances during the last century. Under such circumstances, the currency in question becomes worthless, as seen in Germany (Weimar Republic) in the early 1920s, in Hungary after World War II, in the dismembered Yugoslavia of the early 1990s and most recently, in Zimbabwe where the pace of hyperinflation may have been the most extreme ever seen.

The historical culprit generally has been the use of fiat currencies — currencies with no hard-asset backing such as gold — and the resulting massive printing of currency that the issuing authority needed to support its spending, when it did not have the ability, otherwise, to raise enough money for its perceived needs, through taxes or other means.

Ralph T. Foster (hereinafter cited as
Foster) in Fiat Paper Money, The History and Evolution of Our Currency (see recommended further reading at the end of this report) details the history of fiat paper currencies from 11th century Szechwan, China, to date, and the consistent collapse of those currencies, time-after-time, due to what appears to be the inevitable, irresistible urge of issuing authorities to print too much of a good thing. The United States is no exception, already having obligated itself to liabilities well beyond its ability ever to pay off.

Here are the definitions:

Deflation: A decrease in the prices of goods and services, usually tied to a contraction of money in circulation. Formal deflation is measured in terms of year-to-year change.

Inflation: An increase in the prices of goods and services, usually tied to an increase of money in circulation.

Hyperinflation: Extreme inflation, minimally in excess of four-digit annual percent change, where the involved currency becomes worthless. A fairly crude definition of hyperinflation is a circumstance, where, due to extremely rapid price increases, the largest pre-hyperinflation bank note ($100 bill in the United States) becomes worth more as functional toilet paper/tissue than as currency.

As discussed in the section on "Historical U.S. Inflation," the domestic economy has been through periods of both major inflation and deflation, usually tied to wars and their aftermaths. Such, however, preceded the U.S. going off the domestic gold standard in 1933 and abandoning international convertibility in 1971. The era of the modern fiat dollar generally has been one of persistent and slowly debilitating inflation.

Recession, Depression and Great Depression. A couple of decades back, I tried to tie down the definitional differences between a recession, depression and a great depression with the Bureau of Economic Analysis (BEA), the National Bureau of Economic Research (NBER) and a number of private economists. I found that there was no consensus on the matter, where popular usage of the term "depression" had taken on the meaning of a severe recession, so I set some definitions that the various parties (neither formally nor officially) thought were within reason.

If you look at the plot of the level of economic activity during a downturn, you will see something that looks like a bowl, with activity recessing on the downside and recovering on the upside. The term used to describe this bowl-shaped circumstance before World War II was "depression," while the downside portion of the cycle was called "recession," and the upside was called "recovery." Before World War II, all downturns simply were referred to as depressions. In the wake of the Great Depression of the 1930s, however, a euphemism was sought for future economic contractions so as to avoid evoking memories of that earlier, financially painful time.

Accordingly, a post-World War II downturn was called "recession." Officially, the worst post-World War II recession was from November 1973 through March 1975, with a peak-to-trough contraction of 5%. Such followed the Vietnam War, Nixon’s floating of the U.S. dollar and the Oil Embargo. The double-dip recession in the early-1980s may have seen a combined contraction of roughly 6%. I contend that the current double-dip recession that began in late-2000 already has surpassed the 1980s double-dip as to depth. (See the Reporting/Market Focus of the
October 2007 SGS and the Depression Special Report for further detail.) Here are the definitions:

Recession:Two or more consecutive quarters of contracting real (inflation-adjusted) GDP, where the downturn is not triggered by an exogenous factor such as a truckers’ strike. The NBER, which is the official arbiter of when the United States economy is in recession, attempts to refine its timing calls, on a monthly basis, through the use of economic series such as payroll employment and industrial production, and it no longer relies on the two quarters of contracting GDP rule.

Depression:A recession, where the peak-to-trough contraction in real growth exceeds 10%.

Great Depression:A depression, where the peak-to-trough contraction in real growth exceeds 25%.

On the basis of the preceding, there has been the one Great Depression, in the 1930s. Most of the economic contractions before that would be classified as depressions. All business downturns since World War II — as officially reported — have been recessions. Using a the somewhat narrower "great depression" definition of a contraction in excess of 20% (instead of 25%), the depression of 1837 to 1843 would be considered "great," as would be the war-time production shut-down in 1945, at least technically.

Two Examples of Hyperinflation

Weimar Republic. Ralph Foster closes his book’s preface with a particularly poignant quote from a 1993 interview of Friedrich Kessler, a law professor whose university affiliations included, among others, Harvard and University of California Berkeley. From firsthand experience, Kessler described the Weimar Republic hyperinflation:

"It was horrible. Horrible! Like lightning it struck. No one was prepared. You cannot imagine the rapidity with which the whole thing happened. The shelves in the grocery stores were empty. You could buy nothing with your paper money."

The hyperinflation in Germany’s Weimar Republic is along the lines of what likely will unfold in the United States. The following two graphs plot the same numbers, but on different scales. The data are the monthly averages of the number of paper German marks that equaled one dollar (gold-backed) in 1922 and 1923, with that number acting as something of a surrogate for the pace of inflation.

The first plot is a simple arithmetic plot, but the earlier detail is masked by the extreme numbers of the last several months, suggestive of an extraordinarily rapid and large rise in the pace of inflation. The second plot is on a logarithmic scale, where each successive power of ten represents the next tick mark on the vertical scale.

While the hyperinflation did hit rapidly, annual inflation in January 1922 already was more than 200%, up from as low as 6% in April 1921. The existing currency was abandoned at the end of 1923.

Milton Friedman and Anna Jacobson Schwartz noted in their classic
A Monetary History of the United States that the early stages of the Weimar Republic hyperinflation was accompanied by a huge influx of foreign capital, much as had happened during the U.S. Civil War. The speculative influx of capital into the U.S. at the time of the Civil War inflation helped to stabilize the system, as the foreign capital influx into the U.S. in recent years has helped to provide relative stability and strength to the equity and credit markets. Following the Civil War, however, the underlying U.S. economy had significant untapped potential and was able to generate strong, real economic activity that covered the war’s spending excesses.

Post-World War I Germany was a different matter, where the country was financially and economically depleted as a penalty for losing the war. Here, after initial benefit, the influx of foreign capital helped to destabilize the system. "As the mark depreciated, foreigners at first were persuaded that it would subsequently appreciate and so bought a large volume of mark assets …" Such boosted the foreign exchange value of the German mark and the value of German assets. "As the German inflation went on, expectations were reversed, the inflow of capital was replaced by an outflow, and the mark depreciated more rapidly … (Friedman p. 76)."

Indeed, in the wake of its defeat in the Great War, Germany was forced to make debilitating reparations to the victors — particularly France — as well as to face loss of territory. From
Foster (Chapter 11):

"By late 1922, the German government could no longer afford to make reparations payments. Indignant, the French invaded the Ruhr Valley to take over the production of iron and coal (commodities used for reparations). In response, the German government encouraged its workers to go on strike. An additional

issue of paper money was authorized to sustain the economy during the crisis. Sensing trouble, foreign investors abruptly withdrew their investments.

"During the first few months of 1923, prices climbed astronomically higher, with no end in sight… The nation was effectively shut down by currency collapse. Mailing a letter in late 1923 cost 21,500,000,000 marks."

The worthless German mark became useful as wall paper and toilet paper, as well as for stoking fires.

The Weimar circumstance, and its heavy reliance on foreign investment, was closer to the current U.S. situation than it was to the U.S. Civil War experience. In certain aspects, the current U.S. situation is even worse than the Weimar situation. It certainly is worse than the Civil war circumstance.

Unlike the untapped economic potential of the United States 145 years ago, today’s U.S. economy is languishing in the structural problems of the loss of its manufacturing base and a shift of domestic wealth offshore; it is mired in an economic contraction that is immune to traditional economic stimuli. As the U.S. government has attempted in recent decades to assuage electorate discontent with ever more expensive social programs; as the Federal Reserve has moved to encourage debt expansion as a remedy for lack of real, inflation-adjusted, income growth; the eventual bankruptcy of the U.S. dollar was locked in. The problem here was taken on and created willingly by U.S. government officials — embraced by both major political parties — not imposed by a victorious and vengeful enemy of war.

In the early 1920s, foreign investors in Germany were not propping up the world’s reserve currency in an effort to prevent a global financial collapse, and they did not know in advance that they were doomed to take a large hit on their German investments. In today’s environment, both central banks and major private investors know that the U.S. dollar will be a losing proposition. They either expect and/or hope that they can get out of the dollar in time to avoid losses, or, in the case of the central banks, that they can forestall the ultimate global economic crisis. Such expectations and hopes have dimmed markedly in the last two years, as the untenable U.S. fiscal condition has gained more public and global recognition.

Zimbabwe. Hyperinflation in Zimbabwe, the former Rhodesia, was a quadrillion times worse than it was in Weimar Germany. Zimbabwe went through a number of years of high inflation, with an accelerating hyperinflation from 2006 to 2009, when the currency was abandoned. Through three devaluations, excess zeros repeatedly were lopped off notes as high as 100 trillion Zimbabwe dollars.

The cumulative devaluation of the Zimbabwe dollar was such that a stack of 100,000,000,000,000,000,000,000,000 (26 zeros) two dollar bills (if they were printed) in the peak hyperinflation would have be needed to equal in value what a single original Zimbabwe two-dollar bill of 1978 had been worth. Such a pile of bills literally would be light years high, stretching from the Earth to the Andromeda Galaxy.

In early-2009, the governor of the Zimbabwe Reserve Bank indicated he felt his actions in printing money were vindicated by the recent actions of the U.S. Federal Reserve. If the U.S. went through a hyperinflation like that of Zimbabwe’s, total U.S. federal debt and obligations (roughly $75 trillion with unfunded liabilities) could be paid off for much less than a current penny.

This image of a sign in a restroom facility at a South African border station with Zimbabwe speaks for itself.

What helped to enable the evolution of the Zimbabwe monetary excesses over the years, while still having something of a functioning economy, was the back-up of a well functioning black market in U.S. dollars. The United States has no such backup system, however, with implications for a more rapid and disruptive hyperinflation than seen in Zimbabwe, when it hits. This will be discussed later.

Read the rest (This is a VERY long read but well worth your time)...

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Check out the AP investigation, link below. Here's what Susie Madrak over at Crooks And Liars opined :

Hmm. Do you think it's really a good idea that one multinational corporation controls the vast majority of the international food supply? Haha, just kidding. Of course it's a good idea! That's why one of the first things we did when we invaded Iraq was to announce a law that farmers could no longer save their own seed:

I didn't even know AP did investigations. Cory Doctorow's How Monsanto owns and manipulates the world's food supply is a fine source; be sure and scroll to the comments. Much Love To The Perspicacious Reader. Let's all somehow be optimistic - please - and if you have any ideas how to do this reliably in the face of this sort of - words fail me - Capital-E-Evil, please drop me a line below...
Foreign Accounts No Shelter;
Tax Evasion Now Requires Permission Slip
May apply to non cash holdings (e.g. gold)
30% Deducted Or Your Foreign Bank Account Will Be Closed

...unless of course
your assets total less than 50,000,
or you are deemed a 'low tax risk' for whatever reason.

Excerpts reposted from the article after this uncanny video from the 1980s, which foresaw capital controls and illustrates the situation quite nicely:

and now for the feature presentation, from a piece in Zerohedge by Tyler Durden:

It's Official - America Now Enforces Capital Controls

It couldn't have happened to a nicer country. On March 18, with very little pomp and circumstance, president Obama passed the most recent stimulus act, the $17.5 billion Hiring Incentives to Restore Employment Act (H.R. 2487), brilliantly goalseeked by the administration's millionaire cronies to abbreviate as HIRE. As it was merely the latest in an endless stream of acts destined to expand the government payroll to infinity, nobody cared about it, or actually read it. Because if anyone had read it, the act would have been known as the Capital Controls Act, as one of the lesser, but infinitely more important provisions on page 27, known asOffset Provisions - Subtitle A—Foreign Account Tax Compliance, institutes just that. In brief, the Provision requires that foreign banks not only withhold 30% of all outgoing capital flows (likely remitting the collection promptly back to the US Treasury) but also disclose the full details of non-exempt account-holders to the US and the IRS. And should this provision be deemed illegal by a given foreign nation's domestic laws (think Switzerland), well the foreign financial institution is required to close the account. It's the law. If you thought you could move your capital to the non-sequestration safety of non-US financial institutions, sorry you lose - the law now says so. Capital Controls are now here and are now fully enforced by the law.


The only exemption to the rule? If you hold the meager sum of $50,000 or less in foreign accounts.

‘‘(B) EXCEPTION FOR CERTAIN ACCOUNTS HELD BY INDIVIDUALS.—Unless the foreign financial institution elects to not have this subparagraph apply, such term shall not include any depository account maintained by such financial institution if—
‘‘(i) each holder of such account is a natural person,and
‘‘(ii) with respect to each holder of such account, the aggregate value of all depository accounts held (in whole or in part) by such holder and maintained by the same financial institution which maintains such account does not exceed $50,000.


But guess what - if you are a foreign Central Bank, or if the Secretary determined that you are "a low risk for tax evasion" (unlike the Secretary himself) you still can do whatever the hell you want:

‘‘(f) EXCEPTION FOR CERTAIN PAYMENTS.—Subsection (a) shall not apply to any payment to the extent that the beneficial owner
of such payment is—
‘‘(1) any foreign government, any political subdivision of a foreign government, or any wholly owned agency or instrumentality of any one or more of the foregoing,
‘‘(2) any international organization or any wholly owned agency or instrumentality thereof,
‘‘(3) any foreign central bank of issue, or
‘‘(4) any other class of persons identified by the Secretary for purposes of this subsection as posing a low risk of tax evasion.

One thing we are confused about is whether this law is a preamble, or already incorporates, the flow of non-cash assets, such as commodities, and, thus, gold. the noose on capital mobility tightens... which will culminate with every single free dollar required to be reinvested into the US, likely in the form of purchasing US Treasury emissions such as Treasuries, TIPS and other worthless pieces of paper....

Go to Zerohedge for more details. Hats off & ninety three to a fine fine interweb publication. The comments are always worth the price of admission: thanks to MarketTruth for bringing 'Rollover' to my attention. I believe it isn't so much clairvoyance as perspicuity that fuels astonishing feats of fictional prognostication such as 'Rollover' and that nine-eleven 'Lone Gunman' episode: after all Kissinger led the Committee to Combat Terrorism in I believe 1972, established by Nixon, which featured planes being used as missiles... attended by Giuliani, and I read somewhere, Cheney and Rumsfeld as well (heres another rummy link), though I can't find that source now, only implications. May have been Kupperman. If anyone has any info on this, please drop me a line...

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The Criminalization of (Almost) Everything

Featuring Harvey Silverglate, Author of Three Felonies a Day; and Tim Lynch, Editor of In the Name of Justice and Director of Cato's Project on Criminal Justice. Moderated by Tony Blankley, Executive Vice President, Edelman, Inc., and Columnist, Washington Times.

America's criminal codes are now so voluminous that they bewilder not only the average citizen but also the average lawyer. Our courthouses are so clogged that there is no longer adequate time for trials. And many of our prisons are now operating well beyond their design capacity. Two new books raise the question of whether the American criminal justice system has become dysfunctional. Harvey Silverglate's new book, Three Felonies a Day, argues that the typical American professional is likely unaware that he or she violates federal law each day because of the breadth and dangerously broad scope of the Code of Federal Regulations. As a result, scores of people—doctors, lawyers, journalists, businesspeople—are vulnerable to sudden, arbitrary prosecution. Cato's Tim Lynch, editor of In the Name of Justice, maintains that the runaway growth of the criminal law has been accompanied by the dilution of constitutional rights and safeguards. Please join us for a discussion of these disturbing trends and what might be done about them.

The Criminalization of (Almost) Everything

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VIDEO SATIRE : Obama Rejects the Narrow, Dogmatic Views of the Jedi

Repost; from the sidebar Info:

The Presidents Nobel Peace Prize acceptance speech is one of the great sins of his presidency. He posited an essentially warlike nature to man not borne out by science. For a person who frequently cites King and Gandhi, President Obama showed a stunning ignorance of history and of nonviolent struggle. His self-justifying redefinition of the dreams of King and Gandhi were offensive and dishonest. His words will be used to discount and delay the expansion of nonviolent struggle as a replacement for military conflict in international affairs. Read more here.

This video uses clips from Star Wars: Revenge of the Sith and Star Wars: The Empire Strikes Back (20th Century Fox) to dramatize the hypocrisy and amorality of the President's reasoning during his lecture.

Well done.  I would say this is Art.  Thank you, DerrickCCrowe. 

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2010 DHS Wish List : Watch Out

What I Want to Know Is... issue # 1

The 2010 DHS Surveillance Technology Wish list 

(or, Tech To Watch Out For...)

1/27/2010 by johanna faust


American citizen: if you think the danger is only relevant to those with "something to hide," you had better think again. Please. (Anonymous)

The makers of our constitution undertook to secure conditions favorable to the pursuit of happiness... They sought to protect Americans in their beliefs, their thoughts, their emotions and their sensations. They conferred, as against the government, the right to be let alone – the most comprehensive of the rights and the right most valued by civilized men. (Justice Louis D. Brandeis)

Soon it will be possible to assert almost continuous surveillance over every citizen and maintain up-to-date complete files containing even the most personal information about the citizen... (Zbigniew Brezhinsky)


I hope you find this helpful, gentle Reader. I could have, you understand, done something more immediately useful instead, like looking for a place to move to – a land like the America of my youth - an America I only thought I lived in, an America that may have never existed.

I come across documents much like the one below semi-regularly, documents in portable document format (pdf), often with an unintelligible title (or none at all), sometimes retrievable only with difficulty (or not at all). I have been noticing a trend, a subtext, chilling hints of a possible future bleak and ugly and maybe hopeless, I don't know, I didn't trust my fear addled mind to unwind them. Such "conspiracy" theories remain discouraged, popular or no. What I want to know is, how did public opinion go from 'That's preposterous' or 'They don't have the resources' or 'Why would they want to do that? What good does it do them?' or 'They who? Who is this they?' on the one hand to "Yeah, yeah, so what,' and 'of course,'? How did not-worth-knowing become everyone-knows-that? What's in between ignorant apathy and apathetic ignorance? No actual details or meaningful discourse, usually. A DMZ of manufactured consent. Livingrooms across the country where too much trust is placed in talking heads on glowing screens, and too little trust in the observations of non-experts. Where discourse is dominated by social jockeying. In other words, people don't really know what "everybody knows," and few have seen source documents for themselves.

So here we go: first, a few of my questions, opinions, and comments; then the original document reposted from Google's hypertext; finally the hypertext link & the downloadable pdf.


The mission of the DHS S&T Directorate is to “support basic and applied homeland security research to promote revolutionary changes in technologies; advance the development, testing and evaluation, and deployment of critical homeland security technologies; and accelerate the prototyping and deployment of technologies that would address homeland security vulnerabilities.”


What I want to know is, why now? What does this have to do with the Captain Underwear? with Iran? Israel? Fort Hood? Bin Laden? Nine Eleven?

Or perhaps you would rather I asked more relevant questions? More credible... ones? Why now? Why do we need revolutionary changes in technologies to deal with airport security? Or to get to the bottom of terror scares like this the most recent, with all their anomalies and discrepancies?

It doesn't sound like its to make the security technologies any less invasive, or less health-threatening. The technoogies seem to be exponentially evolving apace. So far they have not indicated that they will prove in the final analysis to have made us substantially safer. So far they have reduced our security, our personal security, against unlawful searches of our persons, our papers, our ipods, and our effects. I would like to think that this is this glaring problem. I could almost imagine it. This caused government to gather, to figure out how to neuter them, how to untether creativity from copyright. Technological change, we find out, will have had to have been rendered (good word, rendered) revolutionary to address. To address it, to actually protect us, DHS would have to take on the greedy-mutherfucking-bastard-corporate-interests, and rewrite the code, so that profit isn't the bottom line. Either that, or strip the corporations of their personhood. But I know better. I know by now, after eight years of Bush's bullshit, after reading a lot of news, I know better.

A friend of mine saw the PDF and shook his head, saying, "Its always been about the same thing: Its always been about the drugs. The drugs and the downloads." The technologies are now just about powerful enough, to let these cats out of their bag, don't you think? When you read the following, keep an eye out for them. Five years ago, there would only have been hints, maybe one vague mention, if any. One could tell, however, that the new technologies could easily handle substitutions. One could tell - or I thought one could - where the nouveau-fasciste were going. Like one knows when they really want drugs, they talk explosives; when they want dissidents, they talk child porn; when they want file-sharers, well, they try not to say anything until the scheme is underway.

A few substitutions, amendments, modules swapped out – and suddenly presto! Law Enforcement would find itself in the enviable position of having far too many exact, credible, detailed leads, and far too much power with which, in following such leads, one could invent whatever the fuck one wished to. Who are they going to believe, an Officer of the Law, or some rag tag you-fill-in-description-of-undesireable-here? And then, in my over-active imagination, the uniformed speaker of that question glares at me. Of course, if I have nothing to hide, I have nothing to worry about. He pauses, tries to look behind me, at what I have written. He squints at the PDF. Flips through the text version. I don't have anything to hide, do I?

No, officer. But I don't consent to any searches, sir.

And then, before anything, without pretext, out-of-place in our conversation because it isn't a conversation – it's never, ever, a "conversation" between a citizen and a police officer, its a trap – What I really really want to know is –

Are you detaining me, officer, or am I free to go?

– before he has had long enough to regroup and relaunch what would no doubt otherwise be a seemingly inexhaustible series of 'gotcha'-games designed to get me to waive my rights, to consent to a search, or to give him probable cause... before he can think of a way to circumvent or sabotage my somewhat unpracticed defieance...

Are you detaining me, officer, or am I free to go?

That's it. Those revolutionary new technologies? They are to get around all this silly posturing. Find a legitimate justification for detaining whom they will, and find it quickly. Automate the process to save the taxpayer money. Revolutionary? Make it predictive. As if data mining worked. As if surveillance was useful. Let us not forget what the exact definition of a terrorist is, according to the language of the Patriot Act, back when it had quote just been written unquote, back when it was of course an understandable legislative response to quote what had just happened unquote, back when it was an emergency measure called for by the quote emergency. Unquote.


American citizen: if you think the danger is only relevant to those with "something to hide," you had better think again. Please.(Anonymous)

Complete and accurate surveillance as a means of control is probably a practical impossibility. What is much more likely is a loss of privacy and constant inconvenience as the wrong people gain access to information, as one wastes time convincing the inquisitors that one is in fact innocent, or as one struggles to untangle the errors of the errant machine. (Victor Ferkiss)

«Qu'on me donne six lignes écrites de la main du plus honnête homme, j'y trouverai de quoi le faire pendre» ("Give me six lines written by the hand of the most honest man, I find something to hang him" – Cardinal Richelieu)


There are a few things that it seems always must be done or established or agreed upon by our "Homeland Security" for anything else to happen, or for DHS to call their activities successfull. At their most fundamental these will be the same as they were for the the Roman, the Mongol, Aztec, Khazar, Mayan equivalents of DHS. Consider the relationship that society, media, institutions, and the individual must have to the state for the agenda of "Homeland Security" to remain viable, much less unquestioned – for the Department itself to pass for useful, never mind for it to be successful.

The Truth is, such success, even at its most minimum, is right now uncertain. Despite the manipulation of the media, of our schools, of our religious or defensive instinct. Despite the implicit or sometimes blatant prejudices that allow the great masss of Humanity to be led about, lied to, totured, overworked, deprived of the basic necessities: p0wned: despite the abysmal nature of things in that respect people are waking up. And more and more are realizing that this horrible, unacceptable situation, where their basic humanity is nearly worthless, could not occur without their legally binding (if silent or implied or coerced, nonetheless, legal and binding) – if manufactured – consent.

Make no mistake. Failure to say "no" is a "yes"; consent is assumed in the absence of explicit refusal.

There is a lot of power, money, and influence at work trying to ensure this consent. It is very important that the fundamentals be controlled, if Capital-T-They get the outcome they want: people, above all, obedient and tractable. As they may not in fact turn out to be. Correct me if I am wrong, but from where I sit, reading news voraciously, people are closer to waking up than they've been for quite some time. More of them than ever before.

For them to neutralize this trend, quickly - that would require sweeping changes. Changes in the whole way the control was being gathered, deployed, and wielded. This is what the DHS is calling for help with. Soon I will let you go forth, gentle reader, into this evil pdf. Look at everything listed, every objective, as a tool. Try to see beneath it. Try to make out at what they take such urgent, deliberate, expensive aim. This objective is just the beginning - guess at what they really want, and you'll be able to see the excuses, as pretexts, the exigencies, as tactics, the principles, as propaganda. What will become of this, of us? How far, given what we know, will it actually go? And what I really want to know is, what can I - can we - do about it? Hopefully knowledge is power. Tell people about this. Post it. Email it. Find other documents like it while you can. Download them, just in case. Let us keep what Freedom we have; let us figure out how to reclaim the rest.

Be seeing you.   


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Dealing With Formaldehyde, or, So You Got Stuck With A Toxic Trailer

Today I heard about the current plan for those FEMA trailers.  Originally intended to poison Katrina refugees, attempts have been made to repurpose them.  Native Americans, Haitians, there are probably others. Brown unfortunate people possibly ignorant of the evil that came with these shoddily constructed officially uninhabitable toxic pieces of sh*t, at no extra (immediate) cost: Formaldehyde

I reacted with that too-familiar profile of disgust, surprise, surprise at my surprise (and a bit of feeling stupid, or is it gullible) - perhaps you've felt it also, perhaps, like me, way too often in recent years. That sinking "of-course-it's-because-they're-evil-motherf*cking-assholes" initial reaction. I found out that the infamous Formaldehyde FEMA Trailers are now being auctioned off, to the general public, for pennies on the dollar, with nought but a (no doubt easily removable) sticker of a fig leaf between their seeming promise of inexpensive shelter and severe damage to the health of their unlucky future occupants.  

If you or someone you know could find this page useful – please get this page to them: Download, print, email, walk it over, whatever works.  Tell them I said 'good luck with that.'  

To All Dealing With a Katrina Style Trailer Situation:


Method of neutralizing hazardous products (United States Patent 5108621)

Treating formaldehyde or formaldehyde containing solutions which are used for tissue fixation, for providing biological sample preservatives and the like to permit a readily available disposal of formaldehyde by dumping or for external treatment without harming the environment. Formaldehyde or solutions thereof are contacted with a composition containing urea, phosphoric acid or ammonium chloride and water, they are allowed to be neutralized by the composition and the reaction product can readily be disposed.


Air Purifiers for Formaldehyde Removal (expensive but explains why)

Residential air cleaner VOC removing performance over long periods of time is problematic... In my opinion, formaldehyde is dangerous at levels which may not provoke "allergy" symptoms. Individuals chronically exposed to aldehydes may loose the ability to smell them. If our only method of timing the replacement of costly gas-phase filters is the return of odors or symptoms, we haven't really eliminated enough of the formaldehyde.

So purifiers that actually remove airborne formaldehyde are going to be expensive, and must run continuously on high fan speeds. To be effective, filter media should be replaced much more frequently than manufacturer recommended intervals.

possible remedy to remove formaldehyde?  (UNREVIEWED)


If anyone tries this and it works, please let me know. (me too - ed.) We know that houseplants can remove formaldehyde from the indoor air but some tests we have done show they aren't enough to reduce the formaldehyde to safe levels.

ServiceAccess may be reached at or 866-981-8201. We provide a service to rid trailers of formaldehyde through licensed and insured applicators. The service requires access for twenty four hours as the trailer must be vacant with air circulation. We aerate the trailer upon completion of the treatment and test for formaldehyde prior to clearing for occupancy. Cost is dependent on size of trailer. Some absorbant materials must be removed prior to treatment.

Neutralization of Formaldehyde Gas by Ammonium Bicarbonate and Ammonium Carbonate

Formaldehyde gas, generated by the depolymerization of paraformaldehyde and in the presence of water vapor, has been traditionally used for biological decontamination of equipment and spaces utilized for research with a susceptible biological agent. This gas has often been neutralized with ammonia gas, generated by the thermal decomposition of ammonium bicarbonate or ammonium carbonate. An elementary theoretical analysis indicates that for total neutralization the proper weight ratio of commercial ammonium bicarbonate to paraformaldehyde is 1.58, while that for ammonium carbonate to paraformaldehyde is 1.00 to 1.13. These values are supported by experimentation. The ratio for ammonium bicarbonate in particular is 44% greater than that advised in existing literature....

Formulation for neutralization of formaldehyde and method of using and disposing of the same 

1. A method of neutralizing a solution comprising formaldehyde, the method comprising contacting the solution with a treatment composition comprising polyethylenimine, urea, and an acid, wherein the treatment composition substantially excludes formaldehyde.

Safe Room - General Instructions

To neutralize formaldehyde in new cotton, add milk (1 cup) to the wash and soak for an hour. 

Proposed Wheat Paste Method (UNTESTED)

To these I would add one more, still entirely theoretical but one I'd try.  I include it because I think its a good idea and I am known for coming up with good ideas that test out -  NOT because I am a hypocrite.  So REMEMBER THAT YOU ARE THE ONE RESPONSIBLE FOR YOURSELF and keep in mind that THIS IS UNTESTED.

Here goes:  Mix about a tenth of a part ferric oxide (that's rust), finely powdered, with water; coat walls; let dry.  Mix urea (pellets, nearly odorless, used to dye cloth) with water and make a strong solution; coat walls; wait until dry.  Make a thick batch of wheat paste.  Coat walls and let dry  -  or think of what color, texture, etc. would complement your décor and use the wheat paste to the end for which it was originally intended: to put up wallpaper.

How to Make Wheat Paste:

How to Hang Wallpaper:

wow! i made an html table with videos!

Note: certain infamous insects love wallpaper.  If your home is a target for these nasty invasive evil m*therfuckers, do not try this method, or at the very least add boric acid to the wheat paste, OR IT MAY ATTRACT THEM.  As a matter of fact, DO NOT USE THIS METHOD AS A SOLUTION UNLESS YOU  HAVE TESTED IT FIRST AND HAD THE RESULTS EVALUATED SCIENTIFICALLY

Testing for Formaldehyde (pdf) (html)

Use a formaldehyde testing kit, an airtight box, and a portion of the paneling (or whatever is outgassing formaldehyde) big enough but not too big - I would guess as big as your hand.  Put it in the box.  Leave it somewhere rather warm for a day.  Test the air  with a testing kit,  so that your result is accurate.  If your results are negative or negligible, retest, make it warmer, check your seals, use a different test method, use a bigger piece, or as a last resort coat the piece --

–––––WARNING! DO THIS CAREFULLY!! VERY Carefully!! wear a respirator (not just one of those flimsy masks), eye protection like goggles (not glasses) and gloves, long pants or overalls, closed top shoes, and a long sleeved shirt!!) –––––

-- coat the offensive outgasser with actual formaldehyde (just a drop or two) and then enclose it as above.  Now test that sucker, I bet you can measure it.  Good.  Now carry out all of the steps I proposed above, exactly, to that piece (FOLLOW THE WARNING, DO NOT CHEAT OR IT WILL HAUNT YOU.  THAT MEANS DO NOT CHEAT ON TIME EITHER, WAIT UNTIL EACH STEP DRIES COMPLETELY.) 


NOW take the piece and put it back in the airtight testing box and measure it with the testing kit again (an unused strip or swab or whatever, of course).  Apologies if you are going 'duh,' and if not, let me refrain from saying 'sheesh' and ask you in my nicest most convincing voice to get someone to help, please, this is way too important.  Formaldehyde is seriously poisonous  DO NOT GET ANY ON YOU.  DO NOT BREATHE ANY.  DO NOT HAVE ANY ANYWHERE NEAR FOOD OR SMOKES.  If the levels are not within acceptable amounts (which to me would be NONE) Ddo not continue; email me with your results if you remember.  Sorry!  This was an untested theory:  Method of Science.  Aim is Success.  

I will update this if/when I have more info, test out the experiment, etc.

As I said above, If you or someone you know could find this page useful – please get this page to them: Download, print, email, walk it over, whatever works.  Tell them I said 'good luck with that.'

Be seeing you.

UPDATE:  My beloved has a better idea, (albeit still theoretical).  "Rip the paneling out.  Rip out all the wood or pressboard, rip out anything else outgassing, and replace it.  It would be less work." I would second that; he has an excellent record of success when it comes to hands-on construction, and, may I add, although a man of few words and certainly no wreck, is certainly one hell of an Engineer.

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