Monday, January 12, 2015

Late last year, with the U.S. economy experiencing falling unemployment and seemingly low inflation, observers were extremely confident that the Federal Reserve would move judiciously in 2015 to restore 'normal' interest rates sooner rather than later. However, in light of the recent fall in both stocks and oil, that conviction has softened considerably.

Many, such as the very influential Bill Gross, now believe that our current Zero Interest Rate Policy (ZIRP), which has been in place for six years, will remain in place throughout the year. While this likelihood is a disappointment to many, who would have preferred to see the economy move along without Fed-supplied training wheels, few really understand the pernicious effects these policies are inflicting on the economy the longer they are held in place. In short, ZIRP is slowly transforming the world economy into a dysfunctional basket case.
Historically, it has been estimated that a 'normal' fair rate of return on short to medium-term high quality debt is between 2 and 2.5 percent, net of inflation. Recently, the Fed published year-on-year U.S. CPI inflation for mid November 2014 at 1.3 percent. This would suggest normal short-term rates at around 3.5 percent at present.
However, using the government's methodology that was in place prior to 1990, John Williams' Shadow Government Statistics (SGS) newsletter calculates inflation to be currently some 5 percent. Using methods in place prior to 1980, it is a staggering 9 percent. At that level, current interest rates should be somewhere around 11.0%. Even if we estimate that real inflation is currently 3%, then our "normal" rate of interest should be around 5%. This is some 50 times the rate paid currently on most bank deposits. This gap is distorting the economy in untold ways.
In early December 2014, the U.S. Congress approved further Government spending of some $1.1 trillion. This came just as the U.S. Treasury's debt broke through a total of $18 trillion. It wasn't that many months ago that the $17 trillion barrier was first breached.
Currently, the U.S. Treasury can borrow for 10 years at around a rate of 2 percent. But if long term rates rose to 5 percent, which would be in line with the historic range of "normal," the 3 percent difference would cost the Treasury an additional $540 billion in annual interest payments (based on the current $18 trillion in debt). This would considerably undermine the government's fiscal position, and necessitate an upheaval in federal budgeting.
The financial repercussions of a tripling or quadrupling of interest rates truly are horrific. They lead to a sense of foreboding that the Fed, aware acutely that the U.S. Treasury simply cannot afford a return to normal interest rates, will not restore normal rates unless forced to do so by international bond or currency markets. It appears, therefore, likely that ZIRP will continue for years to come. This feeling is underpinned by a view that low interest rates are simply a benign stimulant that fails to appreciate the actual harm they impose, particularly in the fixed income markets.
Savings are the prime source of real long-term investment. Today, savers are being crushed by the Fed's manipulation of interest rates to below a real return. To find even small real returns, investors have had to scour the financial landscape for sources of yield. In doing so, they have ventured into risky territory and have, for instance, flooded into the high yield market, pushing junk yields to record low territory. The repercussions of providing excess capital to risky businesses have yet to be experienced, but the energy industry should provide us with a hint of things to come. Over the last few years small and midsized energy firms were able to borrow cheaply and lavishly to fund drilling projects, thereby greatly increasing production. But in retrospect, these efforts look like they helped create an oversupply of energy that has depressed the price of crude and has exposed the energy sector to long-term financial stress. Bankruptcies and creditor losses may be inevitable.
Another concern of the Fed is that despite an unprecedented increase in liquidity and part-time employment, real job creation is still sluggish at best. Furthermore, the Manhattan Institute's Power & Growth Initiative Report of February 2014notesthat the U.S. oil and gas boom has created some one million jobs with a further ten million in associated occupations. The oil boom has improved net employment and kept the economy out of recession. But oil prices have fallen dramatically, threatening these economic bonuses and high-yield bond defaults. It's hard to see what other distortions and hidden pitfalls have been created by negative real rates. The traps often become visible only after they have been sprung. 
But with major economies such as the European Union, Japan and Russia flirting with recession (and China slowing down considerably), there is growing fear that normal interest rates would be dangerous at present. This fear likely will encourage the maintenance of ZIRP, possibly for years, with financial markets disconnected increasingly from the real economy.
Therefore, investors may continue to benefit for some time from the consistent boosting of financial markets by central banks. However, the longer a major correction or even a crash takes to develop, the more sudden, deep and devastating it may be.

Muhammad on Killing Critics of Islam

Pamela Geller / Atlas Shrugs

There are many references to the death penalty for blasphemy. Here is an excellent SAHIH hadith in which Muhammad approves of a man killing the mother of his children for making fun of Muhammad. Thanks to David Wood for this:
Sunan Abu Dawud 4361 (Muhammad on Killing Critics of Islam)
Sunan Abu Dawud 4361
Here’s Sunan Abu Dawud 4361 (4348 in some editions), in English and Arabic, along with the rating (sahih). In this hadith, a man kills the mother of his children for speaking against Muhammad. Muhammad, in response, says that no one is to punish the man.
So when Muhammad’s own companions killed critics of Islam, and Muhammad approved, why do politicians, the media, and Muslim groups keep insisting that killing critics has nothing to do with...


German paper that printed Charlie Hebdo cartoons target of arson attack

hamburg-arsonIt’s an all-out war to destroy the freedom of speech and impose Islam’s blasphemy law restricting negative speech about Islam. And most of the Western media has already surrendered and submitted to this violent intimidation by refusing to run the cartoons.

“German newspaper target of arson attack after printing Charlie Hebdo cartoons,” DW, January 11, 2015 (thanks to C. Cantoni):
A German newspaper in the northern city of Hamburg that reprinted Prophet Muhammad cartoons from French paper Charlie Hebdo has been the target of an apparent arson attack. Authorities said no one was injured.
Police said “rocks and then a burning object” were thrown through rear court-yard windows into archive rooms of Hamburg’s daily newspaper, the Hamburger Morgenpost around 0200 a.m. local time (0100 UTC).
Two people seen acting suspiciously in the area had been taken into custody, as authorities investigated further, police added, refusing to give more information about those detained.
The investigation had been handed to Hamburg city state’s protection service.
Hebdo massacre connection?
The Hamburger Morgenpost had printed three Charlie Hebdo cartoons following last Wednesday’s massacre in Paris. The Morgenpost headline on Thursday had read, “this much freedom must be possible.”…
Egypt: Student gets three years for insulting Islam
UK: Muslim cleric praises Charlie Hebdo jihad, says UK "enemy of Islam"
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Islamic State (ISIS) claims to have hacked CENTCOM Twitter account


Bare Naked Islam

As Barack Hussein Obama ran his mouth to the nation regarding national cyber security efforts, hackers claiming to represent the Islamic State (ISIS) took over the Twitter account of the Pentagon division in charge of the Middle East.


Free Beacon  Hackers with the Islamic State, also known as ISIS, posted links on U.S. Central Command’s official Twitter page to what it claimed was “confidential data from your mobile devices.”

1421087193412-1“ISIS is already here, we are in your PCs, in each military base. With Allah’s permission we are in CENTCOM now,” said one tweet sent from CENTCOM’s account.


The apparent hack came as President Obama addressed the nation regarding cyber security. He is expected to propose two pieces of cyber security legislation and to address the effort in his upcoming State of the Union address.



The hackers subsequently tweeted images of spreadsheets containing the home addresses, phone numbers, and email addresses of dozens of current and former senior U.S. military officers.




Hackers appear to have also compromised CENTCOM’s official YouTube page, where they posted a pair of IS propaganda videos.


These two NY newspapers say it all...

Enough...We've Had Enough...Part 1 of 3
By: Diane Sori
“Islam is as dangerous in a man as rabies in a dog.”
Sir Winston Churchill

And so they came to Paris...

One by one from all over France they gathered to stand strong and united as one against terrorism...against muslim islamic terrorism.

And they and a half million French men, women, and children marching through the streets of Paris (3.7 million marched across all of France)...NOT for a funeral or memorial service per se, but for a quiet and respectful act of protest and show of solidarity against the out of control political ideology known as islam. 

The world's great leaders...over 50 in fact... including Britain's Prime Minister David Cameron, Germany's Chancellor Angela Merkel, and Israel's Prime Minister Benjamin Netanyahu (the man who warned the world time and again about the dangers of islam)...stood alongside French President Francois Hollande. Joined by Russian Foreign Minister Sergei Lavrov and Turkish Prime Minister Ahmet Davutoglu, they all linked arms to march together as one to show the world they stood united with the people of show the world they stood united against islamic terrorism.

Even Mahmood Abbas...for Palestinian political expediency alone...and the King and Queen of Jordan...again to serve their own purposes...were there but most noticeably absent was American President Barack HUSSEIN Obama...the 'supposed' leader of the free world.

What a slap in the face and insult to NOT only the 17 murdered, but to the French people and to the other leaders of the, for now, still free world. Obama's NOT going sent a powerful message to the world of his renunciation of leadership in the 'War on Terror' and his condoning of, or in the very least his looking away from, on-going islamic terrorism. And know this snub will rightfully NOT be forgotten nor forgiven. (Article continues below video.)
See video of Obama's absence here:

And as they gathered in a cry for freedom from a nightmare of their own doing for France, like the other nations of Europe, has allowed this islamic nightmare to unfold because of their lax immigration laws. And that laxness along with their placating and appeasing these in the muslims...has brought France and all of Europe to the point they are at today. 

And while on Sunday they marched 'over there' here in America burdened with its own immigration problems...this administration continues to purge the word islam...continues to purge the word muslim...from major U.S. government and military documents...and does so in the name of political correctness for this most miserable of presidents dares NOT step on his brethren's toes. And so Barack HUSSEIN Obama willingly looks away to the reality of the horrors being done by those whose blood also courses through his veins.

What happened in France yesterday should be happening in DC and in cities all across America today...protests drawing hundreds of thousands if NOT millions...for only in visual tangible numbers...can change for the better be initiated...and only in numbers can the pen and the phone be removed from the hand of a vile and dangerous man run amok.

And while the unofficial slogan of Sunday’s rally could be seen on a large balloon flying over the marchers, “Je suis Charlie, flic, juif”...“I am Charlie, a cop, a Jew” (the hostages targeted and killed were all French Jews)...Prime Minister Benjamin Netanyahu rightfully took a front row position in the march of world leaders and did so just as French law enforcement officers were told to erase their social media presence and to carry their weapons at all times because word reached French government officials that terror sleeper cells have been activated throughout France over the last 24-hours. And this in turn led to 90,000 French army soldiers being deployed to search for possible attackers.

And yet some NO matter this warning...NO matter this French military deployment ...NO matter the horrific events at Charlie Hebdo...many in the West still believe that we are NOT at war with islam but only at war with radical islam. And to that I say it's way passed time that people wake-up to the reality and accept as fact that we indeed are at war with islam...the one and only entity known as islam...and that we have been since a sunny day back in September of 2001.

So as we in the West continue to fight the on-going 'War on Terror,' remember that there is NO real strategy in place to win that war, and this alone has allowed the islamists the ability to grow stronger and bolder in the methodology they use to achieve their goal of establishing a worldwide caliphate ruled by sharia law. And we in the non-muslim world need to really understand and accept as truth...that when muslims say they will do 'something' to avenge what they perceive as the West's dishonoring of their prophet muhammed...and know that threats against we infidels are made on a daily basis...they will indeed do it. And know that the days of saying that NOT all muslims are terrorists is over for if you do NOT condemn you do indeed condone...and when was the last time you heard muslim voices uniting in loud and clear condemnation of acts of jihad...of act of terrorism.

The simple fact is you have NOT except for a lone voice here and there. But now one of those lone voices...and a very powerful voice...has broken that silence as just mere weeks ago while speaking before islamic authorities from the Awqaf Ministry and Al Azhar University as they celebrated the birth of islam’s prophet muhammed, Egyptian President Abdel Fattah al-Sisi, a practicing muslim, spoke the truth about the islamic world’s relationship with the rest of the world. Daring to say that islam needs reformation if it is to continue to exist in today's 21st century world, al-Sisi spoke these words knowing that many political leaders here in the West still believe that islamic terrorism is anything but a representation of islam itself. Yet al-Sisi knows the truth that the two are indeed one and the same for he knows well that it's many of the words within the qur'an itself, along with its many out-dated ideas, that muslims hold sacred... that muslims have ritualized with unyielding unbending devotion...that are arousing NOT only the rightful ire of the Western world, but are arousing the rightful ire of any and all those NOT in the muslim world as well.  

“It’s inconceivable that the thinking that we hold most sacred should cause the entire umma [Islamic world] to be a source of anxiety, danger, killing and destruction for the rest of the world.  Impossible!,” al-Sisi said. 

And he said these words bravely knowing that he had just put his life in danger at the hands of the very people he speaks of.

And as the march itself drew down, Prime Minister Benjamin Netanyahu and French President Francois Hollande were welcomed with loud cheers as they entered the Grand Synagogue in Paris (the largest synagogue in all of France) for the official ceremony honoring “all the victims” slaughtered at the hand of islamic savages.“Israel will live, Israel will overcome” those gathered chanted for they know that the muslim world's hatred of Israel is at the bottom of this all. Calling out Netanyahu’s nickname “Bibi” time and again and bursting into loud applause as he announced that the four Jewish hostages murdered in the kosher grocery store would be laid to rest in Israel, Netanyahu expressed his appreciation to France for taking a strong stance against both anti-Semitism and terrorism all while recognizing the“renewed struggle against the Islamic terrorism that is threatening all of humanity.” 

And so it became obvious to all watching these events unfold live on their TVs that for at least one night all in that synagogue were Jewish in their hearts...were Jewish in their soul...putting aside the sad reality of growing anti-Semitism spreading throughout Europe...anti-Semitism reignited by the growing influx of muslims entering the nations of Europe. 

But some good could come from last week's horrific events as maybe now Europe will close their borders to this muslim invasion and start deporting many of those currently there...maybe now Europe will realize that it's NOT the Jews but the muslims who are the enemies of their culture...maybe Europe will now start to understand that it is Israel who might be the one to save them for Obama's absence at yesterday's events shows that as long as he is America's president he will NOT lead the world in a true war against his blood brethren...blood brethren out to kill us all.

So now with a warning having been issued I hope the world, and especially America, takes notice that events like what happened in Paris will happen again and again, and that 'We the People' truly understand that the world's great oceans will NO long insulate us from events such as this. And since Obama will NOT protect us it becomes even more critical that these islamic bastards know...that Barack HUSSEIN Obama know...that behind every blade of grass...and you dear reader all know exactly what I mean.

May the 17 murdered at the hands of islamic savages forever Rest in Peace knowing that maybe their deaths will be the catalyst for people waking up to the fact that the enemy known as islam...just like a cancer growing within a body...must be totally eradicated in order for the civilized world to survive.

In tomorrow's part 2 of this 3-part series, my RIGHT SIDE PATRIOTS partner and friend Craig Andersen will address the specifics of islamic terrorism and its ramifications.