July 21 2009 WHAT COLOR ARE YOUR SHOOTS?

Oh - those green shoots keep popping up. The economy must be getting better in spite of so many of us still natter about the chasm yawning at our feet. Apple is making money, though you might ponder that this might arise from some psychedelic shoots. But, the shoots in Texas are a withered brown from the second year of drought. There are few shoots in California's central valley since they cut off the water. Meanwhile everything is certainly green here in New England as we turn into the new temperate rain forest. It wasn't supposed to work this way.

For Goldman Sachs, however, the shoots are of gold, tinged though they are with a bit of blood sucked from the public. I try to be cynical but I just can’t keep up. Since Matt Taibbi’s article a couple of weeks ago, it seems that Goldman Sachs knows exactly where to squeeze to milk more in to its treasure chest.

For instance, check out this Daily Kos article on how this computer code Goldman Sachs has been using gave their computer a split second glimpse of where trades were going and then allowed them to profit from the direction. Talk about Market Manipulation. He ends by saying that Matt Taibbi is an optimist.

So, this article registered on my consciousness as important. Then Friday, the Times prints an article Steal This Code which takes the discussion into the weirdest of dead ends. In fact it is so weird that I start wondering if this could be a corporate strategy to redirect attention away from the story by making it kind of a trivialized spite thing. It seems like the story required some rebuttal, so I sent a letter.

To the NY Times

It was sad to see the Times miss the real story leading to July 17th Op Ed Steal This Code. The piece you printed supposedly provided context to the recent arrest of Sergey Aleynikov for the theft of some important software from his former employer, Goldman Sachs.

Unfortunately, Mr. Osinski's "Steal this Code" provided neither useful context nor additional depth to the story. Rather, it seemed to act as a resume piece for Mr. Osinski's personal software chops and giving him a soapbox to steer the public conversation away from the real blockbuster of a story. The real lead seems to be that Goldman Sach's itself was using the disputed software for theft on a truly grand scale.

For the past week there has been significant blog traffic regarding a story which was posted on the Daily Kos. When you learn what this software really does, you might understand why we should all be worried about its implications.

The "stolen" software gives Goldman Sachs an unfair advantage by allowing it to "front run" electronic trades. Simply put, they can use their massive computer might to sniff the data in millions of daily individual stock trades. Goldman can do this because they control so many broker data lines connecting into the major markets. Using mere milliseconds, their computers could tell the nature of the trade and respond by initiating Goldman Sachs counter-trades which would then arrive at market simultaneously with the "stolen" trades. Such an infinitesimal timing edge on each of the millions of daily trades provided Goldman Sachs with a hundred million dollars in extra "profits" per month.

In essences they were profiting by stealing information from the people and companies who sent electronic trades through their system.

However, rather than trying to protect the public's interest in such massive theft, you choose to print some useless insight into the nature of software authoring. Perhaps the New York Times might fear advertiser punishment should it print a story which says; "Goldman Sachs is profiting from theft".

This is too bad because right now, stories of Goldman Sachs criminality would really sell some papers.

Respectfully.

The Times has yet to thank me for my comments. Go Figure.

Daily, I stare in wonder at the green shoots brigade, blossoming with financial company profits, tout the investment opportunities available in the stock market, while the number of storefronts in Lexington with FOR LEASE signs just keep growing.

President Obama is crowing about pulling us back from the brink of financial disaster.

I want some of whatever they are smoking.

Speaking of altered states, it seems to me that we are starting to see the generational reinvention of a bunch of values that those of us on the activist left during the 60s thought we had invented. If you want to go back to the Romantics and the Transcendentalists, they thought they had invented them as well. One interesting article that spins off from that was found on Huffington this week where Ryan Grim connects Apple’s Steve Jobs to the Hoffman, the discoverer of LSD. The implication is that much of the computer revolution was fueled by enhanced perceptions gained in said altered states. I like it.

Actually, there are some interesting green shoots starting to emerge. Friday night, Bill Moyers Journal had on a couple of young environmental activists who seemed more ready to take on the system than the last generation or two’s. It left me with a brief moment of frission as these youngsters seemed less ready to compromise for real change than their parents.

Another sign of optimism, to me at least, also came from, Who’d a thunk it, the Harvard Business Review. They ran a fun piece by Umahir Haque, The Generation M Manifesto, where he tries to have a positive vision of what the Boomers have done to screw things up, and what the next generation (sic) needs to do about it. It’s a nice vision, and visions are needed, but we still have to find someplace which is tying together the possible.

Sometimes you don’t have to go outside the mainstream to see the future, just look with a different eye. For instance, the NY Times ran a story about Korean professionals who are taking menial jobs like as fishermen and farmers, and lying to their families about their job status. It kinda reminds me of the reality two years hence when many of us current professionals will be learning the joys of farming and subsistence living while still pretending that our next great professional challenge is just around the corner.

The problem is, so many of the efforts that fed our “hope” have lost their way.

Today, like many of you, I got another Move On solicitation to help support Obama's health care plan.

And I was also supposed to call Senators Kennedy and Kerry to make sure they supported it.

Oh, and could I donate something to help support the effort to support the plan?

I thought about it for a while, then I burrowed many layers deep into their website to share a comment.

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Dear Move On.org

Guys

I am having a real hard time with the request for donations to support a health plan I don't support.

I worked for Obama, I gave, but now I am waiting for Obama to actually provide some leadership. I am waiting for him to come before the American people and start telling the truth about the inability of Congress to respond on not only health care, but also global warming and the war.

Congress is going to take this guy down because they are owned by somebody else than the American public. Obama has to say so.

I come from Mass, so big deal, I get to call Kennedy Kerry and Markey who already on Obama's side. They would even support him if he took on the Congress.

It looks to me like the corporate bosses informed the New President last January that he had "just the most adorable family". They would sure be sorry if anything happened to that family because security lapsed....

This health care bill doesn't do a thing to control the costs and seems to be a way a way of transferring a lot of working people's monies to the medical industry, insurance company management and the drug monopolies.

When Obama starts talking about how these guys own the Congress and until the country starts understanding which congressmen and senators are sucking on the corporate tit, nothing that the citizens want to happen will, and it is their congresspersons fault. When he does that, I will start donating again.

Thanks

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I feel for Barack Obama, I really do. He is hung out there trying so hard not to be an angry black guy and run to the middle, and he is being rolled. The guys who know how to make messages have a bigger brain trust than he does. Sorry guy!

You don’t think so?

Check out this website where you can store your weighty soul. The even advertised it as the real thing in the New Yorker. The thing is really a marketing ploy for a movie.

Obama doesn’t have a chance.

July 6 2009 Week of the Living Dead.

In the past week, the mainstream American media descended into the vampire’s crypt feeding off the manufactured grief for the ghoulish public feasting on the cult of dead Michael Jackson, More screams echoed out of DC’s granite mausoleums as the financial and pharmaceuticals industry sucked the blood out of the movement for real health care reform while the petroleum industry feasted on the dead souls of their Congressional minions who had dutifully drained the last bit of vitality out of the climate bill.

For the week’s other freak show, we all watched in fascination as the walking dead victims begged for blood during the sentencing of the first of the hedge fund vampires, Bernie Madoff. Even satan couldn’t sell Bernie’s soul on E-Bay. Meanwhile, the US foreign policy establishment seems to be channeling the spirit of the British Raj with its failure to understand why great powers get spit out by Afganistan. At the end of the week it even looks like Wall St is finally giving up the ghost this spectral rally where the green shoots were merely badly lit slime mold.

Over in the less trodden fields of the media landscape, the other than mainstream press was trying to direct some healing sunlight on stories that may have more relation to the reality we, the living, actually experience.

Rather than the festivals of blood and circuses, people might find some serious analysis on who has really sabotaged the economy, why the environment keeps getting worse and where our citizenly attention needs to be focused elsewhere. For any of you who seem to be discovering that the stories and themes handed out by television and the news magazines doesn’t seem to be related to the world you inhabit, maybe you will find some of the following of interest.

A must read of the week is Matt Taibbi’s piece in Rolling Stone The Great American Bubble Machine, or how Goldman Sachs has engineered almost every great financial rip off of the past 90 years. Its not like those of us with a dark turn of mind didn’t know this, but the way that Taibbi digs into the history of Goldman’s machinations is refreshing in its detail and comprehension. You will learn how Goldman created one of the great schemes which helped usher in the crash of 1929, how they perfected the art of IPO pump and dump to spur on the Internet bubble, how they helped create the great derivatives machine which led to the hundreds of billions of our federal dollars going into the TARP bailout. Not only that but you will begin to understand why the presence of Larry Summers and Tim Geithner at the White House is part of the great Goldman Sachs plan to transfer even more of our treasury to their pockets.

This article is a follow on to Taibbi’s The Big Takeover from the March 19 Rolling Stone, where he did a great job of showing how the oligarchy is manipulating the financial system to make sure that they suck up not only our personal income but also hoover out the Federal budget through their chokehold on the banking system and their Mafia style control of all our Federal regulators.

Think of a sort of refined WASP / Jewish Mafia when you think of the current governments ties to the financial oligarchy.

If the Taibbi article wasn’t enough, Alexander Cockburn has posted The Wall St White House with an almost mind numbing catalog of all the Goldman Sachs consiglierie who have been placed in key positions in the Obama administration. It’s this almost Medieval hierarchy of influence which exercises its divine rights to money while the so called Fourth Estate snoozes fitfully at the feet of its masters who can turn off or on the advertising dollars like the filp of a whip.

If you are new to this alternate view of things and think that so much talk about a Mafia or an oligarchy is so much sour grapes, you might be interested in Simon Johnson’s article The Quiet Coup in the May Atlantic. Johnson is an MIT economist who I definitely a reluctant critic of the current economic system. On the other hand he clearly lays out a description of how a small oligarchy of financial services honchos have taken complete control of our future and are milking all of us to their personal benefit.

Never to be outdone with a metaphor, Frank Rich in the NY Times yesterday tried to put a warning shot over Wall St by reminding the bankers why the cold blooded killer John Dillinger was so popular in the 30s. Dillinger robbed from the banks that robbed from the poor. The financial services folks may have need to remember this lesson over the next year.

For those of you who want a little more abstract grounding with your doom reports, we would also suggest keeping up with Michael Greer and his Archdruid Report. This week he turn his view to the failures of traditional economics in comprehending the breakdown in our supplies of natural resources. In reading classic economics texts he discovers that there is no room for the ideas of Peak Oil or resource depletion because the basic assumption of the discipline is to assume that increased demand and price for any resource will necessarily then create more supply, simply by the magic of the market. From there he reintroduces EF Schumachers concept of what is really important in any productive economy.

“a hard distinction between what he called primary goods and secondary goods. Secondary goods are the goods and services provided by human labor, the ordinary subject of economic theory. Primary goods are the goods and services provided by nature, and they make the production of secondary goods possible.”

It is a very good and direct analysis and well worth the read.

Dimitri Orlov brought a unique view of the current crisis of economy and resources in last years “Reinventing Collapse” which draws extensive analogies between the current US economic decline and the Russian decline of the early 90s. In his current Club Orlov post he goes further in exploring the probable near term realities of the peak oil crisis by showing what happens when the current exporting countries need to pull back exports to meet internal needs for energy. The macro effect in the world markets won’t be pretty. His basic message is that the severe dislocations from peak oil are coming a lot faster than anyone wants to believe.

For people who like to look behind the curtain at how the oligarchy controls our thoughts and keeps us from even looking at what is really happening, Chris Hedge’s article “The Truth Alone will not Set You Free” in Truthdig is really powerful. He explores the ways that the media convinces us that democratic freedom is rooted in our ability to make consumer choices. Much of his article explores the work of Stewart Ewan (author of Captains of Consciousness) who has made a lifelong study of how the media and public relations has corrupted our abilities to function as citizens. The core concept here is that our mediated masters have learned how to control our emotional response to certain ideas and issues so thoroughly that most of us are incapable of rationally responding to logical argument. This is such total control that we have proved incapable of practicing the democracy that we thought was our birthright. Control of the emotional concept means that good rational liberals can mount all the evidence possible needed fo people to understand the threats of global warming, concentrations of huge wealth, declining resources and international diplomacy, but these arguments will fall on deaf ears if the other side controls the emotional filters by which people hear a debate.

If you would like to truly want to understand how this filtering works and what must be done to challenge the current systems of control, George Lakoff’s work goes another step in laying out how our irrational frames of understanding overcomes the supposed power of rational and objective truth. “The Political Mind” is based on Lakoff’s background in linguistics and mathematics, and therefore provides a depth of understanding which goes beyond most of the emotion based bloggers who rail at the perpetual idiocy of the American electorate.

One of the great ongoing debates of the darkside is the future direction of money and investments. To put it into a quick reference thumbnail, the is the gold bug camp which sees the run up of the huge Federal Debt along with overlapping commodity bubbles leading to a coming bout of hyperinflation. There seem to be any number of these gold bugs who generally include a large dose of Libertarian rhetoric with their financial analysis. One of the most fun and provocative is the Mogambo Guru at the Daily Reckoning. This week he notes that if one digs into the numbers which get reported as the current savings rate (7% seemingly) then the compound earnings of the S&P is something like a negative 25%. Basically you are bound to loose 25 cents on every dollar you invest in stocks right now. He always notes that “we are so freaking doomed”.

Countering the gold bug inflationists are the smaller number of deflationists. The lead blog here is Mish’s Global Economic Trend Analysis, where Mike Shedlock holds forth on the current financial news and provides charts and graphs which prove his thesis that all assets are deflating and that the only rational place to put your cash is, well, cash. Where Mish is important is that he seems to have a good track record and does not seem at all blinded by the self serving sales crap which seems to be the hallmark of most investment sites.

One site, however, takes the cake for doom and gloom economic analysis. This is Urban Survival, posted daily by George Ure somewhere in E Bumsquat Texas. George gets up at 5 early morning to post by 9AM ET and seems to do more typing in 3 hours than most of us can do in a day or two. He seems to have a constant scanner on internet and other news sources and manages to link to more conspiracy theories and weird Area 47 connections than seem reasonable. What makes George notable and even gives him a decent prediction track record, is his connection to these strange geeks with a computer program he calls “the rickety time machine”. The program scans the web for language patterns which can be turned into predictions of coming events. Right now Ure and his Time Monks are predicting a complete market crash starting in August and deepening into the Fall. This will be coupled with a swine flu pandemic and a breakdown of the social order. In this environment George doesn’t want to pick either gold or cash, but rather food and tools. He is a really odd, educated survivalist who believes that the excrement is right now hitting the fan. CYA now!

Ya gotta admit that you can’t get much darker than that.