The US House or Representatives, Unable to Function, Waffles on Derivatives Rules and Libya Resolution
6/1/2011 Portland, Oregon – Pop in your mints…
The leadership of the United States finds itself publicly handcuffed to the interests of the banks and defense contractors and at this point appears effortless to free itself. Two glaring and pertinent examples have appeared in this week in what can only be described as an utter and complete failure to act on behalf of the people. This inability to govern, as a QE program is evidence of the failure of a currency regime, is evidence of the very failure of a government.
Both examples are from the US House of Representatives:
Exhibit A of House Dysfunction: House Financial Services Committee Votes to Delay Derivatives Rules
For the uninitiated we offer a humble and intentionally oversimplified explanation of what this means.
You may recall that In 2008, The United States gave a $700 Billion blank check to the financial services industry (commonly known as TARP) with few, if any, questions asked. When the inevitable, albeit insincere political backlash from the masses began to surface, the taxpayer was pacified with a piece of legislation called the Dodd-Frank Act.
The Dodd-Frank Act is a fictional attempt to regulate the financial markets. Its passage was meant to put to rest any doubts that the US Government knew what it was doing when it immediately and blindly ceded over 5% of GDP to the sharks of the financial industry.
Senators Chris Dodd and Barney Frank were going to make sure that the financial markets never put the US Government in the uncomfortable position of having to bail them out again.
The main culprit was identified as the OTC derivatives market, presented to the people as a clandestine exchange where financial companies freely traded promises that they couldn’t keep for money that their counter parties didn’t have. The whole thing was a fraud to begin with.
Unfortunately, passage of the Dodd-Frank Act has simply legitimized and encouraged this fraud. Now, nearly two years later, Congress is having trouble implementing rules with teeth to apply the fairy tale derivatives market which is now reportedly worth $600 Trillion dollars, or roughly 10 TIMES GLOBAL GDP.
The failure to write rules for this worthless piece of legislation simply underscores how far the money lenders have infiltrated the US Government.
Meanwhile, large cap companies continue to raise large amounts of cash in preparation for a complete breakdown of traditional credit markets which could occur later this summer, no matter what the authorities do.
Exhibit B of House Dysfunction: House puts off Vote on Libya Resolution
In what is perhaps an even more shocking example of how far the defense contractors have infiltrated the US Government, we have this report of a House resolution being pulled for fear that it will pass. From the Associated Press:
“The GOP leadership had scheduled a vote Wednesday on the resolution by Rep. Dennis Kucinich, D-Ohio, that “directs the president to remove United States Armed Forces from Libya … not later than 15 days after the adoption” of the measure. The vote was delayed as the leadership and Obama administration realized frustrated lawmakers likely would support it.”
If this is to be believed, there is widespread support in congress for the US to immediately cease and desist all military activity in Libya. At The Mint, we had speculated that the US had no business intervening in Libya. It appears that the House of Representatives agrees.
But as appears to be the case with the Dodd-Frank Act, a mysterious force seems to be impeding the US Government from following the simple guidelines laid out for it in its own founding document, the long since forgotten Constitution of the United States of America.
With the government quickly running out of money and virtually impotent to do anything, let alone carry out its basic functions of protecting the life and property and its citizens, a time of “adjustment” (chaos in the financial markets) appears to be rapidly approaching on the horizon.
Are you prepared?
P.S. Please check out our latest 72 Hour Call at www.davidmint.com
Key Indicators for Wednesday, June 1st, 2011
Copper Price per Lb: $4.09
Oil Price per Barrel: $99.82
10 Yr US Treasury Bond: 2.97%
FED Target Rate: 0.10% FED IN DESPERATION MODE!!!!
MINT Perceived Target Rate*: 2.25% INFLATION HERE WE COME!!!!
Unemployment Rate: 9.0%
Inflation Rate (CPI): 0.4%
Dow Jones Industrial Average: 12,290
M1 Monetary Base: $1,892,800,000,000 THE CRACK-UP BOOM BEGINS!!!!
M2 Monetary Base: $9,036,600,000,000 MORE FUEL FOR THE CRACK-UP BOOM!!!!
*See FED Perceived Economic Effect Rate Chart at bottom of blog. This rate is the FED Target rate with a 39 month lag, representing the time it takes for the FED Target rate changes to affect the real economy. This is a 39 months head start that the FED member banks have on the rest of us on using the new money that is created.
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