Tuesday, December 28, 2010

Wednesday, December 22, 2010

Lifetime Servitude - The Real Cost of a College Education in the UK

Most people never even think about college education from an investment standpoint -
Government estimates show that their new university fees system is unsustainable, and that students will spend their whole working lives paying back the cost of a degree.

It is thought that only one in four will be able to pay back the full cost of their education show internal government figures, seen by the Independent on Sunday.

Ministers believe most graduates will spend their whole working lives making monthly payments simply covering their loans and interest, but never settling their debts.

According to a briefing note from the Department for Business, Innovation and Skills (BIS) only 25% of graduates will repay “at least 100 per cent of the original value of their loans in PV [present value] terms”.

Their ‘best case scenario’ sees a maximum of half of university leavers settling their debts, and 60% will never pay in full.

Labour have now questioned the sustainability of the new system, with shadow universities minister Gareth Thomas saying, “The Government’s figures look more and more questionable.

“When even they think such a high number of students will not be able to repay their loans in full, it underlines just how unfair and unsustainable it is trebling student fees.”
The Real Effect
Now, this is not to say that all college degrees are worthless, just most of them. What is actually needed is productive innovation and creativity not "education" or at the least what constitutes a modern education.

Think for a moment, if America, several hundred years ago could innovate and design its way out of poverty and lead the world into an industrial revolution, what is preventing us from doing it again? Namely our lack of liberty to make it so.

It's quite alright those because bankrupt systems inevitably reap the seeds that have previously sown in foolishness. This bloodshed will create the soil for new, vibrant institutions which will offer a competitive advantage to those who actually want it.

But what actually stymies me is the fact that so many students not only want the inferior product that is offered in the system, but that they think they can't live without it. Sorry kids, your grandparents made do, so can you.

Tuesday, December 21, 2010

Wikileaks Israels Plan to Shut Down US Internet in Action

Surveillance State - The US Is Quickly Entering the Techno-Fascist Realm

Can you tell it's Christmas? March out the terrorists! Sigh, what isn't a terrorist nowadays -
Attorney General Eric Holder has an urgent message for Americans: While he is confident that the United States will continue to thwart attacks, "the terrorists only have to be successful once."

"What I am trying to do in this interview is to make people aware of the fact that the threat is real, the threat is different, the threat is constant," he said. 
They only have to be successful once? What does that even mean? To what end?  This is annual nonsense that is designed solely to freak out average citizens and justify the monstrosity that the government is evolving into.

Holder continues -

In a rare and wide-ranging interview, the attorney general disclosed chilling, new details about the evolving threat of homegrown terror, and touched on topics ranging from Wikileaks to the prisoners at Guantanamo Bay.

What was uppermost on his mind, however, is the alarming rise in the number of Americans who are more than willing to attack and kill their fellow citizens. 
This is just disingenuous.  Notice how only the government can define the threat? Notice the lack of details how it's morphing into your cousin, your uncle, your brother?

In the last 24 months, Holder said, 126 people have been indicted on terrorist-related charges, Fifty of those people are American citizens.

"I think that what is most alarming to me is the totality of what we see, the attorney general said. "Whether it is an attempt to bomb the New York City subway system, an attempt to bring down an airplane over Detroit, an attempt to set off a bomb in Times Square ... I think that gives us a sense of the breadth of the challenges that we face, and the kinds of things that our enemy is trying to do."

Holder says many of these converts to al Qaeda have something in common: a link to radical cleric Anwar Al Awlaki, an American citizen himself.
That's rich, 126 people are indicted on terrorist-related charges. Ooooo sounds scary. I know that idiot that tried blowing up a plane by LIGHTING HIS PANTS ON FIRE is certainly scary.

The Real Effect
No in all seriousness, does the fact that the bogeyman Anwar Al Awlaki dined at the, Pentagon bother anyone?  Or many of these supposed terrorists are tied to him and are often, if not always set up by the government? Manufactured crisis anyone? Ordo ab chao.

It's easy to see why they are doing this. The government has a revolt on their hands because the serfs are tired of being treated like cattle with the non-stop intrusion by Big Brother into their mail, their data, their garbage, travel, places of business, health care, food, even their opinions.

Government is behaving like an out of control mother hen segregating and isolating her chicks into bubbles to "protect" them from the big scary world. Except the bubbles have a common name here in the real world.


Monday, December 20, 2010

Milton Friedman - Abolish the FED!

2010 Year End Review Part 1

On December 31, 2009 I posted the following New Year's predictions for 2010. I broke the post into two parts with the prediction (Real Effect) followed by the review (Evidence) Let's review -

Real Effect -
U3 will hit 11.5 % and could go as high as 15%, the U6 as high as 30%, but the rates will certainly not go down very far, if they go down at all. 
Evidence -

U-3 comes in at 9.8%, U-6 is more notable at 17% and SGS-alt is at roughly 23%
Oooo, a swing and a huge miss. Not a good way to start things off but there is good reason as to why the prediction was inaccurate. People are hiding the facts. The Bureau of Labor Statistics has managed to downplay the severity of  numbers through various methods:
  1. Releasing low initial estimates, then quietly revising the numbers upwards the next week. (To instill confidence in the market.)
  2. Emphasizing the U-3 data and ignoring the historical U-6 data. Which coincidentally is officially approaching Depression levels.
  3. They are totally ignoring the Labor Participation Rate which has individuals becoming not only unemployed, but off of unemployment as well. (No longer being reported in the statistics because they have given up searching)

The stimulus and positive "animal spirits" have plateaued unemployment. For now.

Points awarded (0 of 1)

Real Effect -
According to economists John Williams and Bob Chapman gold is going to explode, perhaps as high as $7,000 and ounce. This temporary dip down is nothing more than a small technical correction.
Evidence -
October witnessed and explosion in the gold and silver markets with massive gains. Silver is holding at $30 an ounce and gold at $1400. One year ago they were at $18 and $1100 respectively for a massive gain of 67% and 27% YOY. Anyone that had invested in silver would have made some amazing profits for the year.

I would think returns upwards of 25% are an "explosion", especially when all the nay-sayers at the time were talking of precious metals as being in a bubble and actually going down. 
Points awarded (1 of 1)

Real Effect -
Food will probably be up 6% and we could possibly hit a scenario where we could physically run out.
Evidence -
Prediction achieved in Review I

Points awarded (1 of 1)

Real Effect -
Oil is currently at $78.97 and it could go somewhat higher, although I do not believe it will be as volatile as it was in years past. (Unless the Straits of Hormuz gets blocked)
Evidence -
Achieved in Review I

On a side note, inflation in commodities is a difficult thing to account for at the moment and definitely affected oil on the back half of 2010 with crude coming in around $90. It appears that it depends on when you catch it as overall, the black gold bounced back and forth between 80 and 90 for most of the year. (Gains AND losses of roughly 13%)

Points awarded (1 of 1)

Commercial Real Estate Collapse
Real Effect -
Is already in progress and gathering steam with the bankruptcy of CIT Group which is tied at the hip with CITI Group. In fact it has already fallen 37 percent in value in the last year and defaults are reaching 16 year highs.
Evidence -
Achieved in Review I

Points awarded (1 of 1)

Real Estate Collapse
Real Effect -
The second wave of the housing market collapse hits (The less risky ARM-A loans continue to default) and banks have yet to start unloading their “shadow inventory” in an attempt to stay solvent. I believe this is already underway as we see-
Evidence -
One of THE stories of 2010 is the foreclosure mess involving MERS. 6.3 million vacant homes, this one is a slam dunk.

Points awarded (1 of 1)

Total points awarded for Part 1:  (5 of 6) 83% on the first half. Pretty outstanding with the only black eye being a result of shenanigans on behalf of the Obama administration and the Federal Reserve. It's ok, you can't prop it up indefinitely.

Friday, December 17, 2010

Massive Brawl Rocks Ukraine Parliament

US Economic Support Pillars are Breaking

Karl Denninger puts out some sobering observations on unemployment -

Holy crap!  Now that's a nasty number.  +893,000?!  Uh, wow.
And the bad news is where it is showing up - the majority of this is in new claims in the regular state figures.  The roll into EUC continues but that +548 up above says that a huge percentage of the people who claimed in the last few weeks "stuck" - that is, there were no material roll-offs from people finding jobs in the weeks leading up to Black Friday.
Remember folks, claims is a "fuzzy" number.  It tells you who claimed but it doesn't tell you who found jobs.  Well, now we know.  And now we also know where the unemployment stats for November, where we lost an actual 500,000 jobs on the household survey, came from. 
Oh, I know, I know..... Nobody could have seen it coming.
 FedEx -

FedEx reported earnings that broadly missed expectations.
Excluding special items, the company reported a profit of $1.16 a share. Analysts, on average, had anticipated earnings of $1.31 per share for the quarter ended on Nov. 30, according to Thomson Reuters I/B/E/S.
Oops.  Or is that UPS.  I guess we'll eventually find out.
Oh wait - higher oil prices are good for shipping companies, right?  You know, commodity costs?  One of the largest expenses for such a company?  Yeah, that's good for earnings.
They got hit for a couple of percent premarket, although at the low it was much worse.  We'll see what happens once the stock starts trading.  Revenue was in fact up, and they're expecting a "strong" holiday and improving economy, and thus raised guidance.
We'll see.
And overall economic conditions -

In recap:
  • Orders up materially while shipments are down. (Bawhahahaha we know where will end up right?)
  • Prices paid skyrocketing while prices received are going up - but much slower.  More margin collapse evidence.
  • Number of employees dropped big.
Headline sounds great, but the internals on the table?  Not so much.
The Real Effect
As was stated at the end of 2009 -
While I don't believe the Mad Max WTSHTF scenario will play out in 2010 fully, barring a game changing terror attack, at a bare minimum people are going to start noticing this huge white elephant in the middle of the room.

In general, 2010 will be the year that the situational blinders come off and everyone realizes that this is serious business here. Think of it as a game of musical chairs where there are 300 million players and only a million chairs and the leader is reaching for the volume knob and if you lose, you lose everything you own.

As if that isn't fun, 2011 will be much worse.
This has definitely been true for this year so far but for further year end review, you shall have to wait a few days.

Thursday, December 16, 2010

Visa and Mastercard Get Blown Out of the Water

Credit takes one directly to the face -

Visa Inc. and MasterCard Inc. plunged more than 10 percent in New York trading after the Federal Reserve Board proposed rules that could slash debit-card interchange fees by 90 percent.

The new rules, posted today by the Fed on its website, may aid retailers and cut profit for lenders who reaped about $15 billion from interchange fees last year. Currently, card networks charge merchants a percentage of the purchase price, regardless of cost. The Fed rules would force networks to rely on transaction fees, which could be capped at 12 cents each.

The result could be an 80 percent to 90 percent drop in funds that Visa and MasterCard pass on to banks that issue cards, according to Tien-tsin Huang, an analyst at JPMorgan Chase & Co. Jason Kupferberg, an analyst at UBS AG, said investors had been braced for a 40 percent to 60 percent reduction. Overall, Kupferberg wrote to clients, there are “more negatives than expected” in the proposed changes.

“The initial view is that it is negative all around,” wrote Scott Valentin, an analyst at FBR Capital Markets, in a note to clients today. “This significantly impacts the business model for the networks.”

Visa fell $9.75, or 13 percent, to $67.19 at 4 p.m. in New York Stock Exchange composite trading, the most in two years. MasterCard, ranked second among card networks and based in Purchase, New York, dropped as much as 12 percent, its biggest one-day slide ever. MasterCard finished down $25.73, or 10 percent, at $223.49. James Issokson, a spokesman for MasterCard, had no immediate comment.

Discover Financial Services, which said it’s “premature to speculate about the ultimate impact,” dropped 3.1 percent to $18.53. New York-based American Express Co., which doesn’t rely on debit cards, fell 3.4 percent to $44.57.
The Real Effect
That little move cost Visa/Mastercard BILLIONS in market cap. So the question becomes is this a good thing or a bad thing? I would say both and neither.

Credit, or more specifically capital investment, is absolutely critical to making the economy grow. However the devil is always in the details in these sort of things.
  1. A line of credit from Visa is not synonymous with capital investment.
    1. This type of credit is often created via leverage.
  2. Just because a company has a given business model, that does not mean that they should be protected by law.
    1. For instance - The mafia launders money, something the government has declared illegal.
    2. Pickpocketing would yield a decent return, but would ultimately leave all but the pickpockets destitute.
  3. A company going out of business is not necessarily a bad thing. This allows poorly allocated resources to redeploy to more productive endeavors.
    1. If Bob's puppy abuse service went out of business, most would rejoice.
  4. Many companies are over leveraged and irresponsibly positioned in this debt saturated economy.
  5. Visa and Mastercard are not the backbone of the American economy. Their failure, while disappointing to some, would allow others to fill the gap in a better, perhaps more ethical way.
  6. A lack of "credit" will force consumers to expunge their debts and return to fiscal health.
    1. This is necessary for economic recovery.
This move might cost these companies money, so what? The more important question is why are these institutions not free to bargain their own agreements with the credit companies? Further, scalping Americans a piece at a time is not a good business model. So, I find it good that these companies have to think outside of the box, bad they're being managed, and immaterial as the whether they stay in business.

Outside of that, this will not help the unemployment numbers and that, is bad.

Ron Paul : Bernanke is World's Greatest Counterfeiter!

England Dispenses With the Pretenses of Freedom

Just like the gun laws, surveillance cameras, GPS, neighborhood stazi, murders and roundabouts this will soon be coming to an American city near you -
UK police chief Sir Paul Stephenson is considering whether to ask the British government to ban protest marches altogether in response to last week’s student riots, a move that would place Britain under a de facto state of martial law.

“It is one of the tactics we will look at and something we will keep under review, and if we think it is the right thing to do then we will do it,” said the Metropolitan Police commissioner.
I'm guessing the whole "Off with their heads" was getting a little too close for comfort.

The article continues -
Although the establishment media in Britain dutifully blamed the protesters for the violent scenes witnessed during the demonstrations, it later emerged that police had been behind a number of provocations that caused the running street battles, including pulling a disabled man out of a wheelchair and dragging him across the street, as well as repeatedly beating protesters on the head with batons.

The use of “kettling” to confine protesters into a tight area has also been heavily criticized for only heightening rage amongst the demonstrators.

Stephenson is considering whether to use the Public Order Act in an attempt to ban marches, despite acknowledging the fact that such a move could only exacerbate the situation. Other proposals are to use water cannons to disperse demonstrators, as well as snatch squads that would literally abduct so-called “trouble-makers” off the streets.

Given the fact that police are being ordered to conduct themselves in ways that only further anger protesters, the overall agenda seems to be aimed at creating agitation that can subsequently be exploited to justify excessive force.

Banning protest marches would extend the already existing no-protest zone which encompasses the area around the Houses of Parliament in Westminster, to the entire country.

The Serious Organised Crime and Police Act (SOCPA) bans the right of protest (unless it is cleared by a commissioner 6 days in advance) within a 1km radius of the UK’s seat of government. The area covers the Houses of Parliament, Downing Street, most government ministries, St Thomas’s Hospital, part of the South Bank and Lambeth Palace.
The Real Effect
Of course we have already seen a portion of this happening already with our "Free Speech Zones" and other such nonsense. Yet the real point here is that the elite are tipping their hands. They are talking about outright tyranny. You won't have the right to protest, because they say you don't.

Liberty is generally killed by its natural enemy, safety. Or in this case, the mere appearance of.

Wednesday, December 15, 2010

Police Beat Wheelchair Bound Student - Interview With Jody McIntyre

Action Video of Greece Riots as Fire Bombs, Stones Fly in Athens

Auschwitz Survivor on Palestine

The Real Reason Why the "Terrorists" Hate US

Who would want this?

In a series of air strikes launched yesterday in the Baghlan Province in northern Afghanistan, the NATO forces destroyed a public school as well as killing 30 “suspected Taliban militants,” according to the provincial governor.

The governor termed the attack on the school an “accident,” and so far there have been no reports of civilian casualties from that particular attack. The identies of the 30 slain in the other strikes have yet to be announced, beyond their being “suspects.”

NATO and the Afghan government have been struggling with a growing Taliban presence in the province over the past several year. Baghlan, as with much of the rest of northeastern Afghanistan, had virtually no Taliban presence ahead of the 2001 US invasion.

NATO also has yet to discuss the attack on the school or to provide any sort of explanation as to how the apparent accident happened. The destruction of the school will likely fuel more public opposition to the war effort.
The Real Effect
All you have to be is a "suspect" (often because of payoffs that their less than respectable countryman take to finger them) and suddenly you're with Al-Quaeda. Think about this for a second:
  1. We invade.
  2. We ask the locals who the "bad guys" are. We offer them cash. LOTS of cash.
  3. Because they "cooperate" the locals become the good guys, the others by virtue of being identified are "terrorists".
  4. We bomb the "bad guys", repeatedly, taking a SCHOOL with it.
  5. The locals resent the collateral damage and then side with the "bad guys" against the invaders.(Who wouldn't?)
  6. The fact that there are resisters is fact enough to justify to the American public that we need to "Finish the job".
  7. Repeat.
Can anyone see the inherit moral and logical problem with this scenario? Easy solution - Remove the invaders, no more problems. Ah, but this won't permit TRILLIONS in dollars of weapons sales, increased budgets and patriotic promotions eh?

End this garbage now. Bring the troops home.

Tuesday, December 14, 2010

"Washington’s Role Is To Serve The Banks" Says Spencer Bachus Incoming House Banking Chairman

Moody's to Cut U.S. Rating?

The game becomes deadly serious -
Moody's warned Monday that it could move a step closer to cutting the U.S. Aaa rating if President Obama's tax and unemployment benefit package becomes law.

The plan agreed to by President Obama and Republican leaders last week could push up debt levels, increasing the likelihood of a negative outlook on the United States rating in the coming two years, the ratings agency said.

A negative outlook, if adopted, would make a rating cut more likely over the following 12-to-18 months.

For the United States, a loss of the top Aaa rating, reduce the appeal of U.S. Treasuries, which currently rank as among the world's safest investments.

"From a credit perspective, the negative effects on government finance are likely to outweigh the positive effects of higher economic growth," Moody's analyst Steven Hess said in a report sent late on Sunday.

After Obama announced his plan, Treasury prices fell sharply in volatile trade last week and yields have hit a six-month high, in part due to concerns over the effect the package will have on government debt levels.

If the bill becomes law, it will "adversely affect the federal government budget deficit and debt level," Moody's said. 
The Real Effect
Like an avalanche, the U.S. debt situation is reaching an untenable position. The arrogance of not only the Federal government, but its people as well is incredible. The position that is continually put out by many is that the U.S. can't go bankrupt.

While the reality is that the U.S. is already bankrupt, there is a modicum of truthiness in the statement that it can't go bankrupt or perhaps more succinctly - The government won't allow themselves to declare bankruptcy. In some ways, who blames them? Would you want to be known as the individual that was running the show when things blew up? I don't think there are many who would. But regardless of how we feel about the situation, reality must be confronted.

The biggest issue facing this country is our level of national debt and the percentage of that is the odious debt that is owed to the insolvent banking cartel. This debt must be repudiated. First, it is not the fault nor responsibility of the U.S. citizens that it's representatives entered into fraudulent contracts without their permission. Further, there is no mathematical way to pay this off, short of massively inflating and then destroying ours and others countries. We must, like Iceland, declare the debt invalid, try and finally imprison the bankers and Reps who did this to us and then cut government down to size.

Sure, the bankers will cry, they will protest, they might even mobilize tanks but this is the only way this once great Republic will survive the coming years.

Friday, December 10, 2010

Religious Flames are Flamed as a Tree Gets Cut Down

Today we have this quite interesting piece from the Mail -
The Holy Thorn Tree of Glastonbury has been chopped down in what is being seen by some as a deliberately anti-Christian act.

A feature of the skyline surrounding the Somerset town, the tree has been visited by thousands retracing the steps said to have been taken by Joseph of Arimathea, who some say was Jesus’ great uncle.

According to legend, Saint Joseph travelled to the spot after Christ was crucified, taking with him the Holy Grail of Arthurian folklore.

He is said to have stuck his wooden staff – which had belonged to Jesus – into the ground on Wearyall Hill before he went to sleep. When he awoke it had sprouted into a thorn tree, which became a natural shrine for Christians across Europe.

To add to its sacred status, the tree ‘miraculously’ flowered twice a year – once at Christmas and once at Easter. It survived for hundreds of years before it was chopped down by puritans in the Civil War, but secret cuttings of the original were taken and planted around the town.

It is from one of the new plants that a replacement tree was planted in the original spot over 50 years ago.
The Real Effect
Now this is quite interesting for myriads of reasons, most notably my prediction in 2006 that religious flames will be kindled -
The global planners are literally banking on this bait-and-switch tactic in order to drive most decent people into believing that 'the other side out to get us' to goad us into 'getting them before they get us'. One only needs to look at the flimsy excuses being offered in the official 9/11 story to see this idea in action. (Like many of the alleged hijackers are still alive.)

I believe that this has moved past the propaganda phase and has moved into the implementation phase where they will drive the world into a religious war in an attempt to harmonize the religions into peace. Problem, reaction, solution.
In addition I'd like to make the following general notes:
  1. Notice how these events are almost always random and unseen? The culprits are rarely caught and when they an individual or group is marched in front of the camera, there is rarely any question as to whether they actually did it.
  2. This tree is a symbol. Nothing more, nothing less. I am amazed at individuals that will rail about a symbol being destroyed and inevitably end up murdering to avenge the symbol. If the tree is sacred, how much more sacred is the bearer of God's image, human life? Case and point, how many Muslim civilians have slaughtered over the image of the twin towers?
  3. This particular tree was a replant from 50 years ago.
We all need to calm down and investigate, save the screaming and yelling for the real villains - The Globalist Banking Cartel.

Anarchy in UK: Video of Prince Charles's car bottled in London's protests

Wednesday, December 08, 2010

Fortress Islands: US pushes Koreas to War?

Private Property - What's that?

Oh what perfect timing, I just happened to receive a copy of The Economics and Ethics of Private Property last night just in time to view this beauty of private property protection -

It was a busy day at the mall. I and my wife, had spent the morning fighting the Christmas crowds in order to buy a little December 25th love. After an exhausting three hours we returned to our car to find a note on the drivers seat.
At first, I was alarmed at the fact someone had opened my car to leave, what I thought, was an advertisement. I felt as if my privacy had been invaded! “The nerve of someone going in my car, my private property, to leave me an unsolicited ad,” I thought. When I looked at the laminated pamphlet, I was even more shocked to see it was from the Toronto Police services and the Insurance Bureau of Canada! It was a note, from Toronto Police Services–which included an issuing officer’s badge number–telling me that that my car door was left unlocked and that it would have taken 30 seconds to steal my car! The note had several other boxes which the officers were to visually search for, such as keys in plain view and valuables in plain view. If the car was locked, without keys in it, the officer was to check the congratulatory box and leave the note on your windshield. I looked around and didn’t see any notes on any windshields. The cars around me didn’t have notes inside. So essentially, the police singled out my car, illegally entered it, did a visual search of it for “ the keys” and “valuables” and left me a note. Not to detract from the seriousness of the situation and my own anger but the officer didn’t even lock the doors behind him! If my car was in danger of being stolen at any minute–so in danger that he felt the need to open my car, check for the keys and leave me a note–he could have at least locked the door!
The story continues...
My wife and I were furious. We weren’t sure what to do, but thought we should at least file a complaint and let them know that what they did was wrong. So the following day, I phoned Toronto Police Services to report a crime.

After being transferred around, I was put through to an officer that worked out of the note issuing branch. I told him, “I would like to report a crime.”

“What exactly happened sir?”

“On Sunday, someone entered my car and left me a note telling me how easy it was to steal it.” The officer began to laugh. He then went on to explain to me how we’d had a rash of car thefts in the area and how this was a new crime prevention initiative.

“Is this not a crime though, am I wrong? Could I do this to someone else’s car?” What he told me, may be some of the most chilling words which I have ever heard.

I wish I had myself a little more together for this because I would have shot back that it’s worse for the police to break the law than criminals! God help us if the people that are supposed to be the benchmark for justice and lawfulness–no matter how small the crime–break the law themselves.

I wasn’t finished though because I had one more question that needed to be asked, “what if you found something in my car when you opened the door?” This was followed by an accusing back and fourth about what I have in my car that I don’t want police to see.

“I don’t have anything in my car but if I did have something, anything illegal what would happen? Would you just leave a note?”

“No sir, we’d wait for you to return and arrest you.” Needless to say, I was shocked by his honesty but not surprised by the answer.

“How is this legal? You entered my vehicle, without my consent or a warrant and would arrest me if you found anything?” To which I was, again, kindly told to get a lawyer and our conversation ended.
The Real Effect
What is not so much a spectacle here is the action as much as the attitude. If this had been some sort of off handed act of compassion, I highly doubt that there would be much if any complaining going on. Rather, the fact that the head of the branch thinks that habitually breaking the law (something he is sworn to uphold) and violating your rights is not only permissible, but necessary in order to protect you from lawbreakers shows the absolute insanity that is rampant in our so-called "civilized" society.

Police, you exist primarily to protect our rights, not to "stop crime". If you violate our rights, you are not Jack Bauer, doing the world some sort of favor, you are more akin to Mao Tse-Tung jackbooting your way into the history books. Of course, with garbage like The Chicago Code being shoveled down their throats on TV and in the departments themselves, it's little wonder that the protectors feel this way. (Hint - Turn off 24.)

It doesn't take a lot of imagination to figure out where this is going. Once the precedent is set that it's acceptable to break the law in order to uphold the law, it's only a matter of time before the laws being broken and the rights being violated become so egregious, that it is only a matter of formality to rightly label the offending group a tyranny.

Tuesday, December 07, 2010

Rage Against Cash Machine: Bank Run Day take-away to trash financial terror?

Ron Paul Stabbed In the Back By the Republicans

It's ok, he wears political Kevlar -
It may have taken 34 years, but Ron Paul has arrived, and he doesn't plan to squander the moment. His agenda includes landing the chairmanship of the House Financial Services Committee panel that oversees monetary policy—a job that will give him the power to push legislation reining in the central bank and to haul Fed governors up to Capitol Hill for hearings.

The prospect has Wall Street, Fed officials, and even Republican House leaders worried that Paul's agenda could roil the markets and make a mockery of the U.S. financial system. This is a man, after all, who entered politics because President Richard Nixon bucked the gold standard in 1971, and now wants to make gold and silver legal tender. He is pressing for an audit of the Fort Knox bullion depository and, earlier this year, grilled Fed Chairman Ben Bernanke about the central bank's alleged funding of Watergate and Saddam Hussein's nuclear program. Bernanke called the charges "absolutely bizarre."  
Five GOP leadership aides, speaking anonymously because a decision isn't final, say incoming House Speaker John Boehner has discussed ways to prevent Paul from becoming chairman or to keep him on a tight leash if he does. If Boehner, who will help determine who gets to chair subcommittees as early as Dec. 8, rejects Paul, he may have to contend with thousands of grassroots supporters and dozens of younger lawmakers who see Paul as a hero. Boehner, through a spokesman, declined to comment. "A lot of the older members probably think Ron is a little bit out of step," says Representative Bill Posey, a Florida Republican and unabashed Paul fan. "The depth of his knowledge on monetary policy, his understanding of it all, is second to none."
The Real Effect
Typical. So very typical of the Republican Party. Ron Paul is one of the few individuals in the country that accurately predicted much of the current economic turmoil gripping the country right now. He single-handedly destroyed much of the competition during the election run up, dominating opinion polls to the point of being excluded, minimized in the media, and openly mocked by Republicans and Democrats alike. In addition, his candidacy helped spur the burgeoning, now co-opted Tea Party movement which galvanized the nation.

And the Republican Party want to EXCLUDE him from a position that he is supremely qualified for? That is the height of arrogance here and just demonstrates that the Republicans have not only not changed their tune, they're singing the second verse!

Which of course was predicted here back over a year ago and summed up here -
The original Tea Party however, becomes marginalized as the economic situation plays out with the right siding with the Fraudulent Banksters, big government and globalists because the problems were just too much, the banks were too big to fail and no one could have seen the crash coming.
The solution? Remove BOEHNER from power.

Monday, December 06, 2010

Wal-Mart Terrorists Coming to a City Near You

Drudge confirms what we knew to be coming -
Department of Homeland Security (DHS) Secretary Janet Napolitano today announced the expansion of the Department’s national “If You See Something, Say Something” campaign to hundreds of Walmart stores across the country—launching a new partnership between DHS and Walmart to help the American public play an active role in ensuring the safety and security of our nation.

“Homeland security starts with hometown security, and each of us plays a critical role in keeping our country and communities safe,” said Secretary Napolitano. “I applaud Walmart for joining the ‘If You See Something, Say Something’ campaign. This partnership will help millions of shoppers across the nation identify and report indicators of terrorism, crime and other threats to law enforcement authorities.”

The “If You See Something, Say Something” campaign—originally implemented by New York City’s Metropolitan Transportation Authority and funded, in part, by $13 million from DHS’ Transit Security Grant Program—is a simple and effective program to engage the public and key frontline employees to identify and report indicators of terrorism, crime and other threats to the proper transportation and law enforcement authorities.

More than 230 Walmart stores nationwide launched the “If You See Something, Say Something” campaign today, with a total of 588 Walmart stores in 27 states joining in the coming weeks. A short video message, available here, will play at select checkout locations to remind shoppers to contact local law enforcement to report suspicious activity.

Over the past five months, DHS has worked with its federal, state, local and private sector partners, as well as the Department of Justice, to expand the “If You See Something, Say Something” campaign and Nationwide SAR Initiative to communities throughout the country—including the recent state-wide expansions of the “If You See Something, Say Something” campaign across Minnesota and New Jersey. Partners include the Mall of America, the American Hotel & Lodging Association, Amtrak, the Washington Metropolitan Area Transit Authority, sports and general aviation industries, and state and local fusion centers across the country.

In the coming months, the Department will continue to expand the “If You See Something, Say Something” campaign nationally with public education materials and outreach tools designed to help America’s businesses, communities and citizens remain vigilant and play an active role in keeping the county safe.

The Real Effect
Of course we predicted this back in 2006 -
This is not a mistake, but rather part of a larger concentrated effort to label most everyone as terrorists. And lest you think this is isolated, in addition to the Texas pamphlet there is also a Virginia manual and Phoenix pamphlet which state very similar things.
Watch for increased surveillance cameras, biometrics and the ever-tightening noose of travel restriction. Think of the TSA but on the interstates and highways as the "officials" become more and more suspicious of "the people".
It doesn't take much to establish that this DHS nonsense is neither going to A) Stop here or B) Shrink in scope.  People often wonder just how Germany became the monstrosity it was back in the 30's, well folks, you have front row seats courtesy of the US Federal Government.

Once the nature of your freedoms are changed (I.E. - The US Constitution grants your rights instead of securing them) it won't be long until the reach of your freedoms are changed. After all, driving is a privilege bestowed by the government, correct? Ask yourself once, just where did the authority to grant this privilege come from, if not from the people themselves? (Bear in mind one cannot exercise authority one has not been granted from another source.)

Once you grasp this concept, several things will slide into view:
  1. Most governments (The Federal especially) are content to grab power that does not belong to them. (Think of this as your local librarian seizing your car because she wrote herself a note authorizing herself to do so.)
    1. They pass this off as a necessary service to you.
  2. Once established, they send you through their system to "get your power/property back". "Come to our courts and we'll see if we agree with you." Good luck.
    1. These systems are not as much rule of law as policy determined by unelected bureaucrats.
  3. Their sights know no bounds. Once a bureaucrat gets a taste of The Power, nothing can quench it. "Doing good." becomes the excuse that tyranny is foisted upon the subjects.

Wednesday, December 01, 2010

The Madness of a Lost Society

US to Bail Out EU? The Death Engine Plows Forward

That sucking noise you hear is the sound of the tide withdrawing with your paycheck. Gee what's with that wall of wat...
The United States would be ready to support the extension of the European Financial Stability Facility via an extra commitment of money from the International Monetary Fund, a U.S. official told Reuters on Wednesday.

"There are a lot of people talking about that. I think the European Commission has talked about that," said the U.S. official, commenting on enlarging the 750 billion euro ($980 billion) EU/IMF European stability fund. "It is up to the Europeans. We will certainly support using the IMF in these circumstances."

"There are obviously some severe market problems," said the official, speaking on condition of anonymity. "In May, it was Greece. This is Ireland and Portugal. If there is contagion that's a huge problem for the global economy."

The remarks foreshadow a visit to Europe this week by a U.S. Treasury envoy who is expected to visit Berlin, Madrid and Paris to hold talks on the ramifications of the debt crisis.

The developments have echoes of the pressure applied by Washington on European capitals last May to create the near $1 trillion EFSF safety net that was last week used to rescue Ireland after its banking crisis spiraled out of control.

The IMF, whose biggest single shareholder is the United States, has committed 250 billion euros to the EFSF.

While reluctant to dictate to Europe how it should address the unfolding debt crisis, the U.S. government is growing concerned about the global fallout of Europe's predicament.

U.S. Treasurys' prices fell and the euro strengthened against the dollar on Wednesday after the news that the United States would be prepared to support an enlarged EFSF.

Germany, whose leaders have expressed frustration at the market backlash against their plans to solve the euro zone's debt problems, does not want to make the stability fund larger.
Or is it?

The Real Effect
Earth to sheep, earth to sheep? Are we angry yet? As Denninger is fond of pointing out, this will not stop until we stop it. We must not permit another bailout, no matter the consequences. We must prosecute the fraud and throw the criminal bankers in jail, not reward them with bonuses. The EU must stand on their own two feet, if it's an insolvent system, let it fail!

This is going to gain steam now, Portugal and Germany are blowing out, China is finally starting to slow and Yahoo is laying off 10 - 20% of its employees.

The music has stopped, now where are the chairs? If I were you, I would get cash, on hand. Buy silver, buy gold, and items to protect yourself because we're going in for a crash landing.

Monday, November 29, 2010

TSA. Homeland Security & Tampa Police Set Up Nazi Checkpoints At Bus Stations

For all of you who think this will stop with any single mode of transportation, or that this makes you safer.

Think this is new? A response to terrorism? Nah, The Real Effect covered this back in 2005.

Wikileaks Dump Destroys What Shred of Credibility the Government Had Left

Vox praises the move -
If WikiLeaks meets the legal criteria of a "U.S.-designated terrorist organization" then so does Wikipedia and the Encyclopedia Britannica. Governments always want to operate in the dark and keep their subjects in ignorance, which is why Julian Assange should not be assailed by the American people, he should be awarded the Presidential Medal of Freedom, regardless of whatever his motivations in making all of this information available to the public might be.

WikiLeaks is nothing more or less than a technological blow for American freedom. Assange is no traitor; the accusation doesn't even make sense considering that he has absolutely no connection with the United States. But it should come as no surprise to the readers of this blog that the verbal attack against the organization is being led by one of those freedom-loving Republicans.

Moreover, the crocodile tears of those in the media who fear that the release of information to the public will "get people killed" is absolutely ludicrous given their support for the ongoing military occupations that have killed hundreds of thousands more people than any number of leaks possibly could. In fact, to the extent that WikiLeaks permits Americans to force an end to their leaders' pointless and unpopular wars, it will almost certainly save lives. After all, when one considers that numerous American leaders have waxed bellicose about the need to go to war to prevent Iran getting nukes, wouldn't it be pertinent for them to know that China is actively helping Iran obtain them?

"More than 250,000 classified State Department reports made public on Sunday reveal that China was urged to stop shipments through Beijing of missiles from North Korea to Iran, and that Saudi Arabia's monarch urged the United States to attack Iran's nuclear facilities."
The Real Effect
Just last night, I got to watch a local public official carry on about educational spending in the state and how 'Now is not the time to cut spending but to increase it...' and that 'further transparency was needed in this environment'. I find this relevant and incredibly humorous. Why?
  1. The statists/globalists are losing public support. This makes them -
    1. Liars. As they lose ground, they start making facts up. Especially economically.
    2. More dangerous then ever. When you start losing power, you get desperate.
    3. More likely to try dangerous gambits like false flags and last ditch efforts.
  2. Non-statists are starting to win political offices.
    1. Rand Paul, Ron Paul (Fed Reserve apt)
  3. The mainstream media is having to parrot the Patriot movement to a degree.
    1. Glenn Beck, Fox, etc...
I see Wikileaks as doing massive damage on two fronts - The actual government respect and the perceived government facade. Glenn Beck would have you believe that the buck stops with George Soros and he's getting closer, but hes not quite there yet. We need to peel back more of the curtain, further back in the chamber we find the real Wizard of Oz pulling the levers.

There is a concerted and planned effort to have riots and general protests at a level higher than the Federal Government. They have destroyed countless nations, savaged economies and slaughtered millions. For this, we need to look to the Bilderbergs, the Council on Foreign Relations, and beyond. These are the real puppet masters and it is in our interests to verify that they don't burn our Federalist leaders to empower themselves. Futher, we need to remain vigilant as the last time there was this degree of blowback on the government with the Republican landslide of '94, we got Oklahoma City just a few months later.

'The Euro Game Is Up! Just who the hell do you think you are?' - Nigel Farage MEP

An absolutely mind-blowing piece of truth disseminated at a critical time.

Wednesday, November 24, 2010

The Giants Make a Move - China, Russia Stop Using the Dollar

Certainly this has been on the table for some time, but it is quite interesting that it is being announced on the heels of the conflict in Korea -http://www.chinadaily.com.cn/china/2010-11/24/content_11599087.htm
St. Petersburg, Russia - China and Russia have decided to renounce the US dollar and resort to using their own currencies for bilateral trade, Premier Wen Jiabao and his Russian counterpart Vladimir Putin announced late on Tuesday.

Chinese experts said the move reflected closer relations between Beijing and Moscow and is not aimed at challenging the dollar, but to protect their domestic economies.

"About trade settlement, we have decided to use our own currencies," Putin said at a joint news conference with Wen in St. Petersburg.

Putin made his remarks after a meeting with Wen. They also officiated at a signing ceremony for 12 documents, including energy cooperation.

The documents covered cooperation on aviation, railroad construction, customs, protecting intellectual property, culture and a joint communiqu. Details of the documents have yet to be released.

Putin said one of the pacts between the two countries is about the purchase of two nuclear reactors from Russia by China's Tianwan nuclear power plant, the most advanced nuclear power complex in China.
The Real Effect
This is what happens when you act like an imperialist nation. Your partners decide to "opt out" of dealing with your nonsense and take matters into their own hands. Of course, this is a perfectly legitimate move, it's just going to anger Washington who views itself as the hub of the world.

I would expect protests from the west in the vein of "unfair trade practices" or even accusation of currency destruction being practiced by these two. Such are the delusions you develop when you idolize your own idiocy. It's likely, if not probable that Washington will see the need to "adjust" their attitude in some fashion, but the girl beater rarely thinks ahead when his woman gets herself a better, stronger man.

Tuesday, November 23, 2010

Korean War Analysis

The entire situation reminds me of the 888 war (Aug. 8, 2008) in which Georgia, with the backing of US Special Forces launched an attack on Russian forces in South Ossetia. At the time, the news agencies decided to start reporting slightly after the start and claim that it was Russia that was attacking Georgia while ignoring the earlier attacks.

In that particular war, if one ignored certain facts or was naively unaware of them, a certain narrative started to emerge that fingered the Russians as aggressive expansionists persecuting the poor Georgians. This scenario was later rebuffed as nonfactual as it came out that Georgia was in fact the aggressor in that conflict.

In this particular situation, several questions/observations immediately come to mind.
  1. Who fired first?
    1. According to South Korea, they fired by North Korea first, but not at them.
  2. If we assume North Korea fired first and was launching a new war, why target civilians?
    1. Let's just assume that the North Koreans are eeevil commie scum for a second - Why waste time, munitions and most importantly public relations blowing up strategic non-starters? Why not target military targets?
    2. Is it possible that the South staged part of this incident to justify a response?
  3. Why would the North announce they are continuing their "nuclear program" and then attack the next day? (A program they got from the US.)
  4. The fact that South Korea just so happened to be running drills on invading the North in the area (close to the N.Korean border) at question at that time. Something that was well within their rights but within suspicion.
    1. They started Monday and were scheduled to last until Nov 30th.
South Korea holds military exercises like Tuesday's off the west coast about every three months, and they typically provoke an angry response from North Korea, but Tuesday's confrontation was far from typical.
The Real Effect
Given all of this, how do I anticipate this will play out? Let's look at each player in the conflict.

South Korea
The ball is in their court now and the world awaits their next move. I'm unsure of how the Korean people will perceive this issue as it all depends on how many facts they can get their hands on.
I'm pretty certain that they will want blood. In addition, it seems that they are tired of being perceived as being "weak" on the security threat that is North Korea.

Add in the Cheonan sinking (Which is a short distance away and incredibly suspicious) and you have a very volatile mix. I believe the pressure from the people will be to retaliate in some sort of limited fashion. Perhaps on their "offensive" assets, like their missile bases. Yet that risks all out conflict with the North. This is not wise.

North Korea
With Kim Jung-Il is handing controls over to Kim Jung-Un, this could be concluded by enemies to be an act by him to solidify military control of this country. (Looks like someone got to that point already.) If this is true, Un risks losing control if he backs down which makes the North particularly dangerous.

After being rebuffed continually in attempts to form an alliance with the south, they just might see the writing on the wall and are moving into a total war footing. Further, with recent US/South Korean exercises in the area including the USS George Washington specifically the yellow sea and possible reports of US tactical nuclear weapons are moving into the theater, they may see things as becoming desperate. But they are tied at the hip with China.

I'm pretty certain that the reported Chinese missile that was fired from a Jin class submarine off the West coast recently is loosely related to this situation.They seem fairly reserved at this point and perhaps the most level headed - "The situation needs to be verified,", but they are playing the sides of this war and it is not in their interest to get involved, yet.

Needing a war to divert attention, this provides a much needed diversion from foreclosure gate and the ailing economy. In addition, with the TSA situation threatening the Federal power grab, something needs to happen to push things back into their control. With Thanksgiving just around the corner, Americans preoccupied with preparation and 28,000 troops stationed there, this might be a nice situation to bail out the Empire. Plus, wasn't Obama just there?

Ireland is bankrupt, Portugal is right behind them, Spain, and the UK. A war would be a nice diversion.

This is geographically close to them, I highly doubt they are pleased about having this sort of conflict in their back yard and want to see the situation diffused.

Reports of the North Koreans supplying the Iranians with nukes could spur the Israeli to push for the US to deal decisively with this situation.

  • The dollar will rise further. Perhaps this is the overall plan?
  • Oil prices will increase. Not tremendously at first, but if this escalates $3 gas will be cheap in comparison.
  • Domestic terrorism. If the US gets involved with the situation, I expect some sort of terror attack to target transportation methods that will allow the TSA to reassert itself, aggressively.
Overall, I don't see this as being "THE" event, rather one of the important stage setting events that pushes the players onto the stage in order to guarantee that they act their part. This is not normal, this is "security theater" on a grand scale.

North Korea and South Korea Resume the War

The war that never ended continues -

SEOUL (AFP) – North Korea fired dozens of artillery shells onto a South Korean island on Tuesday, killing one person, setting homes ablaze and triggering an exchange of fire as the South's military went on top alert.

In what appeared to be one of the most serious border incidents since the 1950-53 war, South Korean troops fired back with cannon, the government convened in an underground war room and "multiple" air force jets scrambled.

The firing came after North Korea's disclosure of an apparently operational uranium enrichment programme -- a second potential way of building a nuclear bomb -- which is causing serious alarm for the United States and its allies.

Some 50 shells landed on the South Korean border island of Yeonpyeong near the tense Yellow Sea border, damaging dozens of houses and sending plumes of thick smoke into the air, YTN television reported.

One South Korean marine -- part of a contingent based permanently on the frontline island -- was killed and 13 other marines were wounded, the military said. YTN said two civilians were also hurt.

"A Class-A military alert issued for battle situations was imposed immediately after shelling began," a military spokesman said.
The Real Effect
I know very little about the current escalation at the moment. As it develops I will post relevant details, but for now you should review this from 2006 -
Yet on the horizon still looms North Korea and most likely China. Perhaps 2009?
and 2007 -
I have said and will say again that this is escalation warfare designed to destroy the American will and ultimately the United States itself. With the logical progression being: Afghanistan -> Iraq -> Iran/Syria -> North Korea -> China/Russia(Japan?)
and June -
Look for increasing conditions of hostility moving towards war with either Iran, North Korea or China outright. In order for this to work, they need to hook in Russia and China for revenge at a later date. (Say 3 and 10-ish years from now respectively.)
...last week and more comprehensively here.

Wednesday, November 17, 2010

Housing Falls Further

Just to drive home the point that the last bubble will not lead you out of the pop -
Construction of new U.S. homes sank 11.7% to an annualized rate of 519,000 in October, the lowest level in 18 months, but permits rose slightly, the Commerce Department reported Wednesday. The last time starts were that low was in April 2009. In addition, housing starts in September were revised down to 588,000 from an original reading of 600,000. Economists surveyed by MarketWatch had expected housing starts in October to drop to an annual rate of 600,000 on a seasonally adjusted basis. Permits for new construction, viewed as a more accurate gauge of home building, rose 0.5% in October to an annualized rate of 547,000. Permits were also revised slightly higher in the prior month.
The Real Effect
This isn't over, the real fun hasn't even started yet.

Tuesday, November 16, 2010

South Park - ...and it's gone.

Banks Going Under, Again

No, the Republicans are probably right. This has noooothing to do with fraud on the banks part whatsoever -
The disarray stemming from flawed foreclosure documents could threaten major banks with billions of dollars in losses, deepen the disruption in the housing market and hurt the government's effort to keep people in their homes, according to a new report from a congressional watchdog.

Revelations that several big mortgage issuers sped through thousands of home foreclosures without properly checking paperwork already has raised alarm in Washington. If the irregularities are widespread, the consequences could be severe, the Congressional Oversight Panel said in a report issued Tuesday. The full impact is still is unclear, the report cautions.

Employees or contractors of several major banks have testified in court cases that they signed, and in some cases backdated, thousands of certifying documents for home seizures. Financial firms that service a total $6.4 trillion in mortgages are involved, according to the new report. Big banks including Bank of America Corp., JPMorgan Chase & Co. and Ally Financial Inc.'s GMAC Mortgage have suspended foreclosures at some point because of flawed documents. (Emphasis mine)
The Real Effect
The banks would have you believe that this has nothing to do with fraudulent activity on their part, that they're just the poor victims of the unscrupulous housing owners that are taking advantage of them. Let's review shall we?

  • Issue #1 - The banks fraudulently loaned money to parties they knew could not repay. (Subprime crisis)
  • Issue #2 - They committed fraud against the deed recording agencies by knowingly transferring deeds against many state law in a complex shell game called MERS. This was to avoid paying taxes on these transfers which would have sucked out the profits on the transactions.(These are the supposed "clerical errors")
    • The institutions committed loan title fraud to hide this fact by shredding documents to keep things easy and clear.
  • Issue #3 - They then split the mortgages into tranches and then fraudulently sold these investment instruments to individuals and companies that used these in part for leverage to the tune of quadrillions of dollars.
    • Mutual and pension funds invested in these assets believing they were solvent.
      • The sellers of the securities lied repeatedly.
"It appears as though many loans and other mortgage-related assets have been double and even triple-pledged to various constituencies."
- Bank of America, U.S. Bankruptcy Court, Jacksonville, CASE NO. 3:09-bk-07047-JAF
We all know what comes next, these poor bankers (that got nice fat bonuses, again) come to us hat in hand claiming that if we don't bail them out, we're ALL GONNA DIEEEE!!! Don't buy it this time. Please.

Monday, November 15, 2010

Canada Customs-Royal Canadian Air Farce

China Is Suddenly the Enemy?

It becomes very curious how the tide of "official" opinion turns with the times -
Pentagon planners were wary of China’s double-digit military-budget growth rates even before the global economic crisis put the squeeze on America’s own defense investment. Now the Chinese army’s growth continues while America’s flat-lines. That’s got the U.S. military, especially the Navy, scrambling for new ideas.

The most hopeful is an emerging concept for mixing U.S. Navy ships and subs with Air Force planes to form a tightly-knit, super-lethal, ship-killing force meant to counter an increasingly powerful Chinese fleet. The Pentagon calls it “AirSea Battle,” an homage to NATO’s Cold War “AirLand Battle” concept that pioneered tactics for taking out thousands of Soviet tanks with smart weapons. U.S. Secretary of Defense Bob Gates called the classified AirSea Battle concept “encouraging.”
And missiles (Wait, didn't we think we saw one of those recently?)
The Chinese military’s non-nuclear missiles have “the capability to attack” and close down five of six major U.S. Air Force bases in South Korea and Japan, an unpublished government report says.

China’s improved inventory of short- and medium-range missiles provides a “dramatic increase” in its ability to “inhibit” U.S. military operations in the western Pacific, according to excerpts from the draft of the 2010 annual report by the U.S.-China Economic and Security Review Commission scheduled for release on Nov. 17.
China’s current force “may be sufficient” to destroy runways, parked aircraft, fuel and maintenance facilities at Osan and Kunsan air bases in South Korea, and Kadena, Misawa and Yokota bases in Japan, the report says. The facilities are within 1,100 kilometers (684 miles) of China.

And aircraft carriers -
The United States has reiterated its pledge to send a super carrier to the Yellow Sea for joint naval drills with South Korea without specifying the timing, despite China's objections.

"The only thing I'd answer is those are international waters and they aren't owned by China," Adm. Mike Mullen, chairman of the Joint Chiefs of Staff, told a media roundtable in Melbourn, Australia, Monday, according to a transcript released by the Pentagon, Tuesday. "They aren't owned by Korea. They're international waters in which we have and many other countries have sailed forever. My expectation is we'll continue to do that."
The Real Effect
An awful lot of the tail wagging the dog going on.

The Real Effect is no stranger to China as the it was discussed first in June 2005, Dec. 2005, April, 2006 (2)
For the record, I do believe that Russia and China are very real and deadly military threats and that the last 17 years of diplomacy are nothing more than an attempt to lure the American people an military into a compromised position in order that they may easily secure dominance.

Look for Russia and China to block the U.S. led Iran sanctions leading the U.S. to impose it's own economic sanctions. Yet, Iran is not in any mood or position to be pressured by anyone, let alone the Great Satan. After this will follow some type of provocation that is tied to or directly the result of Iran's actions. This in turn enrages the "International Community" which sees no other option but to 'deal with Iran'.

The problem then becomes that Russia and China, two enormous militaries, are tied at the hip to Iran. They will perceive this as a direct threat and will most likely launch an invasion against the United States and Israel.
July 2006Sept 2007,
 I have said and will say again that this is escalation warfare designed to destroy the American will and ultimately the United States itself. With the logical progression being: Afghanistan -> Iraq -> Iran/Syria -> North Korea -> China/Russia(Japan?)
and most recently in June -
Time is running short and the group is wasting no time in implementing their agenda as the Iranian war moves to the front burner, again. (They were denied their war in 2006.) Look for increasing conditions of hostility moving towards war with either Iran, North Korea or China outright. In order for this to work, they need to hook in Russia and China for revenge at a later date. (Say 3 and 10-ish years from now respectively.)

In addition, there is no room for a U.S. in the New Global Order, so look for our power to either be redistributed or decimated. This will be part of the new religious war that I have discussed, but the payoff is not quite here, yet.
The easiest explanation of this is that the U.S. is miffed that China is stuffing their monetary plans and is trying to paint China as the bad guy. (And just who gave them their money, corporations, and technology?) Here's a clue, it certainly wasn't the Iranians.