America in a Trance (Or America the Stupid)
by Al Martin
(Nov 14) Despite our urgent recommendation to the contrary, the American people have seen fit to turn Congress into a Bushonian Rubber Stamp. What does this mean? The Bushonian Regime will begin to rape and pillage the nation’s social security trust fund once again. Also they have already announced that they will continue to denude the people of their civil rights and liberties by bringing before Congress the three pieces of legislation they could not get passed in the previous Congress, namely 1/ The National Identity Card act, 2/ The act to overturn Posse Comitatus and 3/ The act to formalize the creation of the Office of Homeland Security. Lest we forget the short term memory of America the Stupid (or America in a Trance), when it comes to the Office of Homeland Security, we should always remember George Bush’s Immortal Words on September 26 (in the post 9-11 environment), when he first mentioned the concept for our Office of Homeland Security and he told us the American people not to worry that it would be a small federal agency and it would act in a coordinating capacity only, it would have no more than 1,300 employees, and it would have an annual budget of no more than $9 billion.
Furthermore, at least half of that $9 billion would come back to the American taxpayers in forms of “savings” because with the Office of Homeland Security, we could streamline the functions of the CIA,the FBI, FEMA and others, and we could reduce staff and reduce costs. That’s how the Office of Homeland Security was billed and how it was sold to the American public.
Now we find that the Office of Homeland Security is in fact going to be a new “super” federal agency with an initial staff of more than 5,000 and an initial budget of $38 billion.
As George Bush has promised us, there have been no savings from the interim workings of the Office of Homeland Security. Not from the CIA. Not from the FBI. Not from FEMA. And not from the National Security Agency.
In fact the budgets of these agencies and the number of people they employ has increased.
As is typical with a Bushonian Regime, the budget is more than 4 times what it was originally billed.
As a consequence, what do we now have to look forward to with a Bushonian Congress?
As the Bush Administration previously announced, that if it regained control of Congress, in order to stimulate the economy, we can now look forward to the acceleration of tax cuts for the Republican Rich which were not due to take place until the “out years” of 2006-2009.
Furthermore it will accelerate the elimination of estate taxes for the Republican Rich that were also not due to take place until the so-called “out years.”
These two measures put together will deny the Federal Treasury at least another $100 billion per annum in desperately needed tax revenue.
The reason why the Bush Administration is so desperate to re-pillage social security funds (counting FICA taxes as general revenue) is because it will provide them with $125 billion a year of additional income. That in turn will make next year’s deficits not look as bad as they otherwise would have been.
This is absolutely classic Bushonomics. You borrow from the future as much as you possibly can to hide the true size of the deficits that you are creating in the present. I cannot think of a better way to describe Bushonomics.
We see that in fact despite every Republican stock market pundit under the sun telling us that “Republican regimes are good for the economy” and “don’t worry because the stock markets will rally if you make Congress a Republican Rubber Stamp.”
Instead we find that the market has sold off 350 points since the Republican victory. So obviously that isn’t true. The reason why is because the market is “reality.”
The market knows that having a Bushonian Regime with a Rubber Stamp Congress presents even more danger to the nation’s economy – not less.
First Call Market Services, which predicts quarterly earnings and so on, had a very interesting comment. They said that all of the big securities and brokerage firms, which are Republican-aligned, are the ones, which had the greatest number of buy recommendations and the fewest number of sell recommendations.
There’s only a handful of them like Goldman Sachs and JP Morgan which are not particularly Republican aligned had five times the sell recommendations than they had buy recommendations. It goes a long way in proving the point about the power that a Bushonian Regime has in its influence over Wall Street to get the Wall Street crowd together to consistently tout stocks in declining markets. You’ve got to buy, buy, buy – it’s on every economic show and round table you hear.
New financial round table talk shows are being added constantly, especially on the weekends. You hear the propaganda – you have to buy stocks, buy buy buy.
More recently you start to see the emails that come in to CNBC and they say things like "three weeks ago Larry Kudlow recommended I should buy Intel at $20, which is $12 today."
CNBC is running more and more of these types of emails that “I bought into the Republican hype and I'm listening to all these Republican stock pundits and they said buy this or buy that and now I've lost half of my money in the last 3 weeks because of it. This is something the American people should be aware of.
My personal opinion is that it is unconscionable what the Bush Administration does in terms of its control of Wall Street market pundits who are made into venerable names in the media that people trust – the Louis Rukeysers of the world.
They have big reputations and they are considered virtual gods. They say buy buy buy because that’s what the administration wants them to say because they are nothing more than shills for the Republican Party.
If one looks at where Larry Kudlow’s money comes from, one will find that it essentially comes from Republican controlled foundations.
What happens is that the Bush Administration is able in a way to keep the market artificially higher than it should be in a bear market trend by the consistent hammering on this “Buy Stocks” theme by well known Republican controlled economic pundits. Consequently the American people end up owning stocks at tremendously high prices.
I never heard Larry Kudlow ever in my life tell people to sell a stock.
People just can’t see the reality. The market rally that we’ve had, 22% from top to bottom, in this 5-week old counter-trend rally, when the economic fundamentals propelling the bear market are growing worse.
There is no fundamental economic reason for people to be buying stocks to have pushed the market 1600 points off the low in 5 weeks. Not when the statistics like the LEI (Leading Economic Indicators) Manufacturing Indices, Construction Spending. Capacity Utilization, Total Employment –numbers that have created the bear market continue to deteriorate, yet the American people are bidding up the market.
Why? Because every television show with every Republican pundit known to man keeps telling people to buy, buy buy. They even drag out the old men like Bill Seidman and Sir John Templeton.
You know the Bush Administration is desperate when they start dragging out the old farts.
If you’re going to be stocks, IRAs or 401(k)s (and I’ve always said this and this is something no broker will ever tell you because its against their best interests to do so because then they can't sell market research), you the individual person wearing your hat as an investor have to do your own homework and research.
You can’t rely on other companies, other people’s research and other economic forecasting services. We’ve seen what has happened. The recent scandals have revealed how biased this “research” really is.
The SEC pretends to slap these people on the wrist, people like the Abby Cohens.
I like what Bill Waldman the great Democratic economist said -- 90% of the research coming out of these Republican controlled security firms and mutual fund houses was simply nothing more than an effort to “put lipstick on a pig.”
And where was the so-called business press, Forbes Magazine, Business Week in this debacle? They were just as unconscionable as the market pundits.
As the market was declining, the venerable magazines like Forbes and Fortune were all screaming buy buy , you gotta buy, “because stocks are cheap.” But stocks aren’t cheap.
It is so ludicrous, and I don’t understand why the American people can’t see through it. There was an analyst on CNBC from AG Edwards for example and every firm tends to make its own assessment of what fair market value is. He was asked what does AG Edwards think the fair market value is and he said we feel that current fair market value is S&P 720. This was a couple days ago when the S&P was at 920. And he’s not asked, what stocks are you selling then? The next question is -- what stocks do you buy?
And he comes out with a whole list of AG Edwards recommended stocks to buy. Yet the firm thinks that the market is 200 S&P points overvalued?
We see this again and again. There is not one firm on the street that has as fair market value anywhere near where the market currently is.
As pointed out by First Call, the average fair market value assumption by what they call the top 100 securities firms and mutual fund houses ranges from S&P 500 to S&P 750.
In some cases we are talking about firms that are saying that the fair market value of the market, right now, is thousands of points lower than where it is. Thousands of points lower.
Yet in the same breath – it’s “what do we buy?”
They’re never asked -- what do we sell or how do we get short?
They’re simply asked about what you buy in this environment if the market is 4000 points overvalued.
These pundits become part of a system that is designed under Republican Regimes to get people to buy stocks at artificially high prices in order to prevent the market from seeking its true value level in a Republican administration which is always much less than where it's trading at.
Then there’s the Stupidity Growth Factor.
During the Bush I Administration people seemed to understand a little more. They understood that under a Bushonian Administration, you’re going to have Bushonomics, which is inherently destructive to the economy. Therefore the market should be trading at some sort of a discount to its fair value to reflect that.
During the Bush I administration, particularly later, you did see the market trading at a discount to its fair market value. But now we see another Bush Administration, that is equally as destructive -- $200 billion deficit for this year, possibly $350 billion deficit next year, which they will of course try to hide by raping and pillaging social security.
Now you see a market that is trading as much a 50% premium to fair market value at a time when not only is the market going down, not only are we in the grips of a bear market, but we have an administration that acts to destroy the economy by its own economic policies.
The bottom line is that for everyone who is long stocks, there is an enormous risk factor in here.
This is an administration, which follows a certain school of economic policies called Bushonomics.
Bushonomics gradually destroys the economy.
That is known and there isn’t any debate about that anymore. That is already a given.
You combine that with the fact that we are in a cyclical bear market. Then you look at the fact that the market is still trading at 50% higher than the average fair market value guesstimate by the top 100 brokerage firms.
Something is very wrong here.
And what’s the bottom of the market? Who knows?
If you listen to Bill Gross of PIMCO, he believes that fair market value is about S&P 600 or Dow 5000. Most of the rest of the street (when it comes to fair market value) is somewhere between 680 and 750 or Dow 6500.
In political and economic terms, the markets are severely overvalued.
And the risk factor has just increased by the fact that we now have a Republican Rubber Stamp Congress. You take an administration whose economic policies are known to visit havoc on the economy and then you increase this power to wreak more havoc to imperial levels.
It’s interesting to note the statement made by Army Secretary Thomas White, the infamous Enron stock swindler.
(I still don’t know why he remains the Army Secretary. His plan to “privatize” the Army is essentially taking the extra money that’s coming in and giving it to all his Republican Crony Capitalist Pals.)
The statement that came out of his office said that the United States Army is now fully prepared to fight “large scale domestic urban warfare.”
This whole concept is being propelled by the Department of Defense and the Office of Homeland Security, wherein our military should now be prepared and dramatically increase US military forces within the United States and that those forces should be ready to fight “large scale domestic urban warfare.” What is so absurd about this is the level of threat assessment.
When he says “large scale street to street fighting” he means domestic urban warfare using our new Broncos on steroids,our new domestic urban hover drones, our new high potency Valium gas and a vast new array of “non-lethal” weapons and refurbishing the CILF (Civilian Inmate Labor Facility) Programs.
I don’t understand why people can’t see through this. The military isn’t being prepared to fight a “war on terrorism” in the United States -- when they say “large scale urban domestic warfare.”
There aren’t that many terrorists in the whole world.
It is the American Citizens that they’re talking about. American Citizens are the target.
The effects of Bushonomics eventually become irreversible and as the economy begins to collapse and there’s nothing that can be done about it because it’s all over. Bushonomics has ruined it.
When we get to the point when this happens, the military is going to have to have the ability to maintain control to prevent people lining up at each bank trying to get their money out or to control the people outside of all the Safeway supermarkets trying to get the last loaf of bread from the shelves.
That’s what they’re talking about.
Selling the people the concept that we need the ability to fight large scale urban warfare due to domestic terrorism is absolute nonsense.
How could foreign terrorists possibly get enough people into this country at any given time to create “large scale urban warfare”?
Why this is America The Stupid is because Americans themselves are the targets and they will ultimately have to be controlled. This has nothing to do with “terrorists.”
People really believed that “we need more military expenditures because of terrorism and to protect the nation against terrorism.” What are we talking about? Cells of two, three or four people widely disbursed around the nation. After all ,that is what terrorism is. And terrorists generally come into this country a few at a time.
And what will happen down the line? We’re seeing the beginnings of this already. A federalized and para-militarized Neighborhood Watch association, which will effectively act as a modern-day Gestapo.
Then the citizenry will divide. You will see the majority that will become “pro-government” and you’ll see 20% of the people who know the truth and understand what everything is all about and they will be the so-called “resistance.”
Eventually that’s how things are going to line up.
The military will remain relatively cohesive even if things get real tough because the military has always been far too close to the Republican Hierarchy for there to be a coup
For instance, if you’re in the service 10 years from now and let’s say the unemployment rate is 30% and the grocery shelves are half full and there are petrol and water restrictions, and you’re in the military and you know you’ve got three square meals a day and a roof over your head, it’s going to look mighty attractive compared with the alternative.
And the higher ups will be sucking up all the gravy, so they’ll comply, but there will be sympathizers within the military, when things begin to fall apart.
The only reason the Domestic Urban Information Guerillas like me will exist is because there will be pockets of support for us within the military and the domestic population. These will be people who will be willing to take a risk to still see the truth get out.
We understand that this column will be popular with the conspiracy types, but it’s also Reality.
Watch Out, Baby, ‘Cuz Here Comes Reality.
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