Detective Krum

Standard & Poor’s has given warning that nearly all of the world’s big banks lack sufficient capital to cover trading and investment exposure risking further downgrades over the next 18 months unless they move swiftly to beef up their defenses.

While some banks may look healthy under normal Tier 1 and leverage targets, critics claim these measures can be highly misleading since they fail to discrimiate between high-risk and low-risk uses of leverage. The system failed to pick up the danger signals before the financial crisis. The supposedly moderate leverage of US banks in 2007 proved to be a spectacularly useless indicator.

Every single bank in Japan, the US, Germany, Spain, and Italy included in S&P’s list of 45 global lenders fails the 8pc safety level under the agency’s risk-adjusted capital (RAC) ratio. Most fall woefully short.

The most vulnerable are Mizuho Financia (2.0), Citigroup (2.1), UBS (2.2), Sumitomo Mitsui (3.5), Mitsubishi (4.9), Allied Irish (5.0), DZ Deutsche Zentral (5.3), Danske Bank (5.4), BBVA (5.4), Bank of Ireland (6.2), Bank of America (5.8), Deutsche Bank (6.1), Caja de Ahorros Barcelona (6.2),
and UniCredit (6.3).Read more here.

Barney Frank is again trying to interfere with free market principles with H.R. 4173 The Wall Street Reform and ‘Consumer Protection’ Act of 2009 see it here.  Remember, it was the end of 2008 when Congress was threatened with Martial Law (according to some Congressmen) if they did not approve the bank bailout. Even John McCain came running back from his presidential campaign to sign on to the bank bailouts. It appear the premise has been to establish a one world money system as reported in the Financial Times in 2008 where it was reported, “Even if the US’s massive financial rescue operation succeeds, it should be followed by something even more far-reaching –
the establishment of a Global Monetary Authority to oversee markets that have become border-less.” See the rest of the article here.

So let’s connect some dots. Bruce Wiseman, (Canada Free Press) wrote a brilliant article explaining the financial ransom in an article here. I printed it below.
The 1987 ascendancy of Rockefeller/Rothschild homeboy Alan Greenspan from the Board of Directors of J.P. Morgan to the throne of Chairman of the Federal Reserve Bank (a position he was to hold for twenty years). From the beginning of his term, Greenspan was a strong advocate for deregulating the financial services industry: letting the cowboys of Wall Street sow their wild financial oats, so to speak.

THE COMMUNITY REINVESTMENT ACT

Greenspan had been the Fed Chairman for seven years when, in 1994, a bill called the Community Reinvestment Act (CRA) was rewritten by Congress. The new version had the purpose of providing loans to help deserving minorities afford homes. Nice thought, but the new legislation opened the door to loans that set aside certain lending criteria: little things like a down payment, enough income to service the mortgage and a good credit record.

With CRA’s face lift, we have in place two of the five elements of the perfect financial storm: Alan
(Easy Money) Greenspan at the helm of the Fed and a piece of legislation that turned mortgage lenders into a division of the Salvation Army.

Perhaps you can see the pot beginning to boil here. But the real fuel to the fire was yet to come.

GLASS-STEAGALL

To understand the third element of the storm, we travel back in time to
the Great Depression and the 1933 passage of a federal law called the
Glass-Steagall Act. As excess speculation by bans was one of the key
factors of the banking collapse of 1929, this law forbade commercial
banks from underwriting (promoting and selling) stocks and bonds.

That activity was left to the purview of “Investment Banks” (names of
major investment banks you might recognize include Goldman Sachs,
Morgan Stanley and the recently deceased Lehman Brothers).

Commercial banks could take deposits and make loans to people.

Investment banks underwrite (facilitated the issuing of) stocks and bonds.

To repeat, this law was put in place to prevent the banking speculation that caused the Great Depression. Among other regulations, Glass-Steagall kept commercial banks out of the securities. Greenspan’s role in our not-so-little drama is made clear in one of his first speeches before Congress in 1987 in which he calls for the repeal of the Glass-Steagall Act. In other words, he’s trying to get rid of the legislation that kept a lid on banks speculating in financial markets with securities.

He continued to push for the repeal until 1999 when New York banks successfully lobbied Congress to repeal the Glass-Steagall Act.   Easy-Money Alan hailed the repeal as a revolution in finance.

Yeah, Baby!

A revolution was coming.

With Glass-Steagall gone, and the permissible mergers of commercial banks with investment banks, there was nothing to prevent these combined financial institutions from packaging up the sub-prime CRA mortgages with normal prime loans and selling them off as mortgage-backed securities through a different arm of the same financial institution. No external due diligence required.

You now have three of the five Horsemen of the Fiscal Apocalypse: Greenspan, CRA mortgages and repeal of Glass-Steagall.

WAIVER OF CAPITAL REQUIREMENTS

Enter Hammering Hank Paulson.

In April of 2004, a group of five investment banks met with the regulators at the Securities and Exchange Commission (SEC) and convinced them to waive a rule that required the banks to maintain a certain level of reserves. This freed up an enormous reservoir of capital, which the investment
banks were able to use to purchase oceans of Mortgage-Backed Securities (cleverly spiked with the sub-prime CRA loans like a martini in a Bond movie). The banks kept some of these packages for their own portfolios but also sold them by the bucket-load to willing buyers from every corner of the globe.

The investment bank that took the lead in getting the SEC to waive the regulation was Goldman Sachs. The person responsible for securing the waiver was Goldman’s Chairman, a man named Henry Paulson.

With the reserve rule now removed, Paulson became Wall Street’s most aggressive player, leveraging the relaxed regulatory environment into a sales and marketing  jihad of mortgage-backed securities and similar instruments.

Goldman made billions. And Hammering Hank? According to Forbes magazine, his partnership interest in Goldman in 2006 was worth $632 million. This on top of his $15 million per year in annual compensation. Despite his glistening dome, let’s say Hank was having a good hair day.

In case this isn’t clear, it was Paulson who, more than anyone else on Wall Street, was responsible for the boom in selling the toxic mortgage-backed securities to anyone who could write a check.

Many of you may recognize the name Hank Paulson. It was Paulson who left the Goldman Sachs’ chairmanship and came to Washington in mid-2006 as George Bush’s Secretary of the Treasury.

And it was Paulson who bludgeoned Congress out of $700 billion of so-called stimulus money with threats of public riots and financial Armageddon if they did not cough up the dough. He then used $300 billion to “bail out” hi Wall Street homeboys to whom he had sold the toxic paper in the first place. All at taxpayer expense.

Makes you feel warm all over, doesn’t it?

Congress has its own responsibility for this fiscal madness, but that’s another story.

This one still has one more piece—the pièce de résistance.

BASEL II

Greenspan, the Community Reinvestment Act, the repeal of Glass-Steagall, and Paulson getting the SEC to waive the capital rule for investment banks have all set the stage: the economy is screaming along, real estate is in a decade-long boom and the stock market is reaching new highs. Paychecks are fat.

But by the first quarter of 2007, the first nigglings that all was not well in the land of the mortgage-backed securities began to filter into the press. And like a chilled whisper rustling through the forest,
mentions of rising delinquencies and foreclosures began to be heard.

Still, the stock market continued to rise, with the Dow Jones reaching a high of 14,164 on October 9, 2007. It stayed in the 13,000 range through the month, but in November, a major stock market crash
commenced from which we have yet to recover. It’s not just the U.S. stock market that has crashed, however. Stock exchanges around the world have fallen like a rock off a tall building. Most have lost half their value, wiping out countless trillions.

If it were just stock markets, that would be bad enough; but, let’s be frank, the entire financial structure of the planet has gone into a tailspin and it has yet to hit ground zero.

While there surely would have been losses, truth be told, the U.S. banking system would likely have gotten through this, as would have the rest of the world, had it not been for an accounting rule called Basel II promulgated by the Bank for International Settlements.

Who? What?

That’s right, I said an accounting rule.

The final nail in the coffin—and this was really the wooden spike through the heart of the financial markets—was delivered in Basel, Switzerland, at the Bank for International Settlements (BIS).
Never heard of it? Neither have most people; so, let me pull back the wizard’s curtain.

Central banks are privately owned financial institutions that govern a country’s monetary policy and create the country’s money.

The Bank for International Settlements (BIS), located in Basel, Switzerland, is the central banker’s bank. There are 55 central banks around the planet that are members, but the bank is controlled by a board of directors, which is comprised of the elite central bankers of 11 different countries (U.S., UK, Belgium, Canada, France, Germany, Italy, Japan, Switzerland, the Netherlands and Sweden).

Created in 1930, the BIS is owned by its member central banks, which, again, are private entities. The buildings and surroundings that are used for the purpose of the bank are inviolable. No agent of the Swiss public authorities may enter the premises without the express consent of the bank. The bank exercises supervision and police power over its premises. The bank enjoys immunity from criminal and administrative jurisdiction.

In short, they are above the law.

This is the ultra-secret world of the planet’s central bankers and the to of the food chain in international finance. The board members fly into Switzerland for once-a-month meetings, which they hold in secret.

In 1988 the BIS issued a set of recommendations on how much capital commercial banks should have. This standard, referred to as Basel I, was adopted worldwide.

In January of 2004 our boys got together again and issued new rules about the capitalization of banks (for those that are not fluent in bank-speak, this is essentially what the bank has in reserves to protect itself and its depositors).

This was called Basel II.

Within Basel II was an accounting rule that required banks to adjust the value of their marketable securities (such as mortgage-backed securities) to the “market price” of the security. This is called mark to the market. There can be some rationality to this in certain circumstances, but here’s what happened.

THE MEDIA AND MARK TO THE MARKET

As news and rumors began to circulate about some of the sub-prime CRA
loans in the packages of mortgage-backed securities, the press, always
at the ready to forward the most salacious and destructive information
available, started promoting these problems.

As a result, the value of these securities fell. And when one
particular bank did seek to sell some of these securities, they got
bargain basement prices.

Instantly, per Basel II, that meant that the hundreds of billions of
dollars of these securities being held by banks around the world had to
be marked down—marked to the market.

It didn’t matter that the vast majority of the loans (90% +) in these
portfolios were paying on time. If, say, Lehman Brothers had gotten
fire-sale prices for their mortgage-backed securities, the other banks,
which held these assets on their books, now had to mark to the market,
driving their financial statements into the toilet.

Again, it didn’t matter that the banks were receiving payments (cash
flow) from their loan portfolios; the value of the package of loans had
to be written down.

A rough example would be if the houses on your street were
all worth about $400,000. You owe $300,000 on your place and so have $100,000 in
equity. Your neighbor, Bill, in selling his house, uncovered a massive
invasion of termites. He had to sell the house in a hurry and wound up
with $200,000, half the real value.

Shortly thereafter, you get a demand letter from your bank for $100,000
because your house is only worth $200,000 according to “the market.”
Your house doesn’t have termites, or perhaps just a few. Doesn’t matter.

Of course, if the value of your home goes below the loan value, banks can’t make you cough up the difference.

But if you are a bank, Basel II says you must adjust the value of your
mortgage-backed securities if another bank sold for less—termites or no.

When the value of their assets were marked down, it dramatically
reduced their capital (reserves), and this—their capital—determined the
amount of loans they could make.

The result? Banks couldn’t lend. The credit markets froze.

Someone recently said that credit was the life blood of the economy.

This happens to be a lie. Hard work, production, and the creation of
products that are needed and wanted by others—these are the true life
blood of an economy.

But, let’s be honest, credit does drive much of the current U.S.
economy: home mortgages, auto loans and Visas in more flavors than a
Baskin-Robbins store.

That is, until the banks had to mark to the market and turn the IV off.

THE CRISIS

Mortgage lending slammed to a halt as if it had run headlong into a
cement wall, credit lines were canceled and credit card limits were
reduced and in some cases eliminated altogether. In short, with their
balance sheets butchered by Basel II, banks were themselves going under
and those that weren’t simply stopped lending. The results were like
something from a financial horror film—if there were such a thing.

Prof. Peter Spencer, one of Britain’s leading economists, makes it very
clear that the Basel II regulations “…are at the root cause of the
crunch…” and that “…if the authorities retain the strict Basel
regulations, the full scale of the eventual credit crunch and economic
slump could be disastrous.”

“The consequences for the macro-economy,” he says “of not relaxing [the Basel regulations] are unthinkable.”

Spencer isn’t the only one who sees this. There have been calls in both
the U.S. and abroad to, at least, relax Basel II until the crisis is
over. But the Boys from Basel haven’t budged an inch. The U.S did
modify these rules somewhat a year after the devastation had taken
place here, but the rules are still fully in place in the rest of the
world and the results are appalling.

The credit crisis that started in the U.S. has spread around the globe
with the speed that only the digital universe could make possible.
You’d think Mr. Freeze from the 2004 Batman movie was at work.

We have already noted that stock markets around the world have lost half of their value, erasing trillions. Some selected planet-wide stats make it clear that it is not just stock values that have crashed.

China’s industrial production fell 12% last year, while Japan’s exports
to China fell 45% and Taiwan’s were off 55%. South Korea’s overseas
shipments decreased 17%, while their economy shrank 5.6%.

Singapore’s exports were off the most in 33 years and Hong Kong’s exports plunged the most in 50 years. Germany had a 7.3% decline in exports in the fourth quarter of last year, while Great Brit
in’s real estate market declined 18% in the last quarter compared to a year earlier.

Australia’s manufacturing contracted at a record pace last month bringing the index to the lowest level on record.

There’s much more, but I think it is obvious that credit pipe can no longer be smoked.

Welcome to planetary cold turkey.

ODDITIES

It is fascinating to look at the date coincidence of the crash in the
U.S. Earlier I noted that the stock market continued to rise throughout
2007, peaking in October of 2007. The dip in October turned
to a route in November.

The Basel II standards were implemented here by the U.S. Financial Accounting Standards on November 15, 2007.

There are more oddities.

Despite the fact that Hammering Hank dished out hundreds of billions to his banker buddies to “stimulate” the economy and defrost the credit markets, the recipients of these taxpayer bailout billions have made it clear that they will be reducing the amount of money they will be lending over the next 18 months by as much as $2 trillion to conform to Basel II. (Any other bailout passed by Congress now is clearly smoke-n-mirrors because Basell II must be adhered to.)

What do you think—Hank, with his Harvard MBA, didn’t know? The former chairman of the most successful investment bank in the world didn’t know that the Basel II regulations would inhibit his homies from turning the lending back on?

Maybe it slipped his mind.

Like the provision he put into his magnum opus, the $700 billion bailout called TARP. It carried a provision for the Federal Reserve to start paying interest on money banks deposited with it.

Think this through for a minute. The apparent problem is that the credit markets are frozen. Banks aren’t lending. They can’t use the money from TARP to lend because Basel II says they can’t. On top of
this, Paulson’s bailout lets the Fed pay interest on funds they deposit there.

If I am the president of a bank, and let’s say that I’m not Basel II impaired, why in the world am I going to end to customers in the midst of the worst financial crisis in human history when I can click a mouse
and deposit my funds with the Fed and sit back and earn interest from them until the chaos subsides?

But, hey, maybe Hank’s been putting aspartame in his coffee.

No, this stuff is as obvious as the neon signs on Broadway to the folks who play this game. This is banking 101.

So, given the provisions of Basel II and the refusal of the BIS to lift or suspend the regulations when they are clearly the driving force behind the planet-wide credit crisis, and considering the lack of
provisions in Paulson’s bailout bill to mandate that taxpayer funds given to banks must actually be lent, and give the added incentive in the bill for banks to deposit their bread with the Fed, one gets the
idea that maybe,  just maybe, these programs weren’t designed to cure this crisis; maybe they were designed to create it.

Indeed, my friends, this is crisis by design.

Someone planned the assassination and someone pulled the trigger.

THE RUBBER MEETS THE ROAD

All of which begs the question, How come?
Why drive the planet into the throws of fiscal withdraw—of job losses, vaporized home equity, and pillaged 401ks and IRAs?

Because when the pain is bad enough, when the stock markets are in shambles, when the cities are teaming with the unemployed, when the streets are awash with riots, when governments are drenched in the sweat of eviction and overthrow, then the doctor will come with the needle of International Financial Control.

This string of ineffective solutions put forth by people who know better are convincing bankers, investors, corporations and governments of one thing: the system failed and even the U.S. government—the anchor of international finance (which is blamed for causing the disaster)—has lost its credibility.

The purpose of this financial crisis is to take down the United States and the U.S. dollar as the stable datum of planetary finance and, in the midst of the resulting confusion, put in its place a Global Monetary Authority—a planetary financial control organization to “ensure this never happens again.”

Bank of International Settlements (BIS)

Sound Orwellian? Sound conspiratorial? Sound too evil or too vast to be real?

This entity is being moved forward by world leaders “as we speak.” It is coming and the pace is quickening.

A year ago, I saw an article in which the president of the New York Federal Reserve bank was calling for a “Global Monetary Authority” or GMA to deal with the world’s financial crisis. While I have seen
following international banking institutions for some time, this was the clue that they were making their move. I wrote an article on it at the time.

By the way, as some may recall, the president of the New York Fed last year was a man named Timothy Geithner. Geithner was very involved in structuring the booby-trapped TARP bailout with Paulson and Bernanke.

Of course, now, he is the Secretary of the Treasury of the United States.

Change we can believe in.

Once Geithner started to push a global financial authority as the solution to the world’s financial troubles, other world leaders and opinion-leading voices in international finance began to forward this
message. It has been a PR campaign of growing intensity. Meanwhile, behind the scenes, the international bankers are keeping their hands on the throat of the credit markets choking off lending while the planet’s financial markets asphyxiate and be some more and more desperate for a solution.

British Prime Minister Gordon Brown, who has taken the point on this, has said that the world needs a “new Bretton Woods.” This is the positioning. (Bretton Woods, New Hampshire, was the location where world leaders met after the Second World War and established the international financial organizations called the International Monetary Fund (IMF) and the World Bank to help provide lending to countries in need after the war.)

Sir Evelyn de Rothschild called for improved (international) regulations, while the Managing Director of the IMF suggested a “high level of ministers capable of reaching agreements and implementing
them.”

Thormer director of the IMF, Michael Camdessus, called on “the global village” to “urgently and radically” implement international regulations. As the crisis has intensified, so too have calls for a global financial policeman, and of late, the PR has been directed in favor of—surprise—the Bank of International Settlements.

The person at the BIS who was primarily responsible for the creation of Basle II is Jaime Caruana. The BIS Board has now appointed him as the General Manager, the bank’s chief executive position, where he will be in charge of dealing with the current financial crisis which he had no small part in creating.

A few well-chosen sound bites tell the story. Following a recent IMF function, discussion centered on the fact that the BIS could provide effective market regulation, while the Global Investor magazine opined that “…perhaps the Bank of International Settlements in Basel…” could undertake the task of best dealing with the crisis in the financial markets.

The UK Telegraph is right out front with it.

“A new global solution is needed because the machinery of global economic governance barely exists…it’s time for a Bretton Woods for this century.

“The big question is whether it is time to establish a global economic ‘policeman’ to ensure the crash of 2008 can never be repeated.”

“The answer might be staring us in the face in the form of the Bank of International Settlements (BIS). The BIS has been spot on throughout this.”

And so you see, this was a drill. This was a strategy: bring in Easy Money Alan to loosen the credit screws; open the floodgates to mortgage loans to the seriously unqualified with the CRA, bundle these as securities, repeal Glass-Steagall and waive capital requirements for investment banks so the mortgage-backed securities could be sold far and wide, wait until the loans matured a bit and some became delinquent and ensure the media spread this news as if Heidi Fleiss had had a sex-change operation, then slam in an international accounting rule that was guaranteed to choke off all credit and crash the leading economies of the world.

Ensure the right people were in the key places at the right time—Greenspan, Paulson, Geithner and Caruana.

When the economic pain was bad enough, promote the theory that the existing financial structures did not work and that a Global Monetary Authority—a Bretton Woods for the 21st century—was needed to solve the crisis and ensure this does not happen again.

Which is exactly where we are right now.

WHAT DO YOU DO?

Let me preface this section by saying that this is advice designed to
help you orient your assets, i.e., your reserves, your retirement
plans, etc., to the Brave New World of international finance. It is not
meant as advice about what you do with your business or your job, or
your personal life.

Those things are all senior to this subject, which has a very narrow
focus. There is an embarrassment of riches of materials that you can
use to stay ahead of and on top of this crisis. Use them to flourish
and prosper. This article is not a call to cut back or contract. It is
to provide you information so you know what is going on and can plan.

Enough said.

First of all, while not likely, but just in case Timothy Geithner is
shocked into some New Age epiphany and Ben Bernanke grows some real
wisdom in his polished dome, this is what the government should do:

1) Cancel any aspects of Basel II that are causing banks to misevaluate their assets.

2) Remove the provision of TARP that permits the Fed to pay interest on deposits.

3) Mandate that any funds given under the TARP bailout or that are to
be given to banks in the future must be used to lend to deserving
borrowers.

4) Repeal the Community Reinvestment Act.

5) Reinstate Glass-Steagall.

6) Restore mandated capital requirements to investment banks.

7) And in case Congress decides to cease being a flock of frightened
sheep and take responsibility for the country’s monetary policy, they
should get rid of the privately owned Federal Reserve Bank and
establish a monetary system based on production and property.

But if a global monetary authority is put in place, it should not be
controlled by central bankers. It should be fully controlled directly
by governments with real oversight over it and with a system of checks
and balances. This you can communicate when this matter hits Congress
or the White House or both (which it almost certainly will).

And what do you do with your reserves in this Brave New World of international finance?

Modesty aside, please do what I have been recommending for a few years
now: get liquid (out of the stock and bond markets) and put some of
your assets into precious metals, gold and silver, but more heavily
into silver.

Keep the rest in cash (CDs and T-bills) and perhaps a small bit in some
stronger foreign currencies like the Chinese yuan (also referred to as
the RMB, which is short for renminbi)

And remember that my recommendations are based on my 30 years of
experience in banking, finance and investments but I have no crystal
ball and make no guarantees regarding my recommendations.

We are living in the most challenging economic times this planet has
ever seen. I hope this article has helped shed some light on what is
currently happening on the international financial scene. I didn’t
cover everything, as I don’t have time to write another book right now.
Nor did I cover everyone involved, but these are the broad strokes.

If you want to follow these shenanigans, log on to The Road to London Summit.
It will all look and sound very reasonable—all about saving jobs and
homes—but you have seen behind the wizard’s curtain and the above is
what is really going on.

Keep your powder dry.

economic collapse, mortgage jihad, hank paulson, bank failures, bank ratings,

Detective Krum

Bank issues are one of many it appears. There is an article and many others explaining the orchestrated effort to bring America down. If there is truth to the concerted effort- that is up to our readers to determine. I will post a few links for you to read the concerns of many. According to the new European Union leader, 2009 started the one world government and you can watch the video here and read the transcript.

EU Times Article here. Remember the Congressman who said the US Congress was threatened with Martial Law if they did not support the first bank bailout? The EU Times article shows Martial Law is a real possibility.  The American Thinker reported a civil national police force here.

The Posse Comitatus Act is a United States federal law (18 U.S.C. § 1385) passed on June 18, 1878, prohibiting military personnel from acting in a police force capacity on US soil against Americans. October 2008, under President George W. Bush that changed.

On October 1, 2008, the US Army announced that the 3rd Infantry Division’s 1st Brigade Combat Team (BCT) will be under the day-to-day control of U.S. Army North, the Army service component of Northern Command (NORTHCOM), as an on-call federal response force for natural or man-made emergencies and disasters, plus civil unrest. Was the President and Congress preparing for civil unrest and why would they expect civil unrest unless something was being planned they knew the American people would reject?

Then President Obama comes into office and a federal deficit is quadrupled  with what appears to be a plan by Democrats and President Obama, to bankrupt and destroy America financially with irresponsible spending.  This plan fits into President Obama’s plan to remake America, see here. Now the American government is no longer a government of, by and for the people see more on this effort to control Americans here. Even President Obama’s plan to remake America in pdf. file is here.  As President Obama said, ‘Change we can believe in.’ That change President Obama is talking about is changing our country from a free Republic to a dictatorship – just read his remaking America plan and watch Congress and his actions.

But let me post a comment regarding the lack of desire for freedom from many Americans. The comment was made by a fellow named Dale Caruso. In my opinion, Dale hit the answer right on. Here’s what Dale said, in part:

“What is happening today (well beyond the scope of this notion of reading U.S. military forces to control the population – as plans, provisions, and scenarios for that prospect have been around since before long I was born – I’m 64. The thought – both here in this country and in others as well, of “Will this happen?” or “When will this happen?” is equally as old. The short answer, is nobody really knows until it does – sometimes it does happen, more often than not it doesn’t.
In your comment, you “named names” – the “villains” as it were. Yet, to be blunt, the quality of their character is actually only a reflection of each and every one of ours – only expanded.
We tend to do that, as a species – look for that person to hold responsible for all of this – the plight and peril that we presently find ourselves in.
I often tell audiences that I lecture too (well, the one’s that haven’t fallen asleep) that the most deadly and heinous weapon ever developed by our species is a weapon that each of us possess ..a weapon responsible for more death and destruction that anything yet imagined. Yet one that is nearly impossible to use on yourself – It is your index finger. “It was HIS fault!”, “It was HER fault!”, It was THEIR fault!, yet when was the last time you saw someone turn that finger in to their own chest and say, “It was MY fault!”
I am reminded of a young law student at the University of Orleans who wonder the same thing – “How could all this be happening?” – “Who’s to blame?”   He then developed this fundamental
insight that every tyranny must necessarily be grounded upon general popular acceptance. In short, the bulk of the people themselves, for whatever reason, acquiesce in their own subjection. If this were not the case, no tyranny, indeed no governmental rule, could long endure.
The young man was Étienne de La Boétie, and the year was 1552.
200 years later, Scottish philosopher, economist, and historian, David Hume independently discovered this principle and wrote;
“Nothing appears more surprising to those, who consider human affairs with a philosophical eye, than the easiness with which the many are governed by the few; and the implicit submission, with which men resign their own sentiments and passions to those of their rulers.”
It has been said that a democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.
Someone once wrote; “Great nations rise and fall. The people go from bondage to spiritual truth, to great courage, from courage to liberty, from liberty to abundance, from abundance to selfishness, from selfishness to complacency, from complacency to apathy, from apathy to dependence, from dependence back again to bondage.” Exactly where we are on this cycle of decline, I’ll leave that decision to your own designs, for me, I would place my money on the last one.
Roman poet Horace once said: “Our parents, worse than our grandparents, gave birth to us who are worse than they, and we shall in our turn bear offspring still more evil.”
I share your concern for your grown children – I also have grown children – 10 of them, ALL daughters – They will, as will yours all be as the are suppose to be. I understand your concern to “protect them” – but understand, your children were your children ONLY until the moment of their birth – then the are their own person, with your role being that of mentor – assigned with the daunting task of loving and mentoring your child to the best of your ability. Therein lies the key phrase “to the best of your ability.” My oldest step-daughter would tell you that she is who she is today because of me. I must admit this surprises me, never knowing that while growing up rolling her while saying “…OH, Daddy!” she was actually absorbing anything.
Perhaps it is necessary to loose something to truly appreciate it. History seems to prove that axiom true. Perhaps it is just our turn to learn that lesson once again – and perhaps too, we will learn something from it this time – that Freedom and Liberty do not come with, nor ever have had an automatic pilot. Maybe that is the most important lesson we can pass on to our children.
I do apologize to you and to everyone who reads these comments for the length of all this – but I am old and I do ramble.

Kevin Tuma’s cartoons explain issues clearly and for a change of pace today, I thought I would post a few cartoons. Enjoy.

tuma, congress, president obama, socialism

Detective Krum

I decided to post something refreshing – a look at America’s direction through time.  The John Birch Society has developed a short video that describes America’s direction.  What makes this video unique is the way history is recorded and how you see America.

Is America turning to Socialism?  Are we really a Democracy? Why is our nation a Republic? Why do elected Congressmen/women identify America as a Democracy? This short video clearly reveals who we are and where we are headed. The John Birch Society’s effort, in this short video, is admirable. Please share this video with your family and friends and feel free to download the video and send it to every elected representative. One thing I enjoyed hearing from an elected official is Governor elect Bob McDonnell said, “Eight months ago I applied for a job, Governor of Virginia, and you hired me. I will not forget I work for you.”  He is a rare individual – he understands who his employer is – We The People.

America

Video link is here.

Thank you to all our readers and those linking to this blog. I want to take this time to wish all of you and your family, a very Happy Thanksgiving. May we all reflect on God Almighty’s mercy, grace and truth towards mankind as a whole and may we thank our Great Creator for all his blessings bestowed upon us and our country. As George Washington, let us get on our knees and give thanks and ask for mercy and victory. Happy Thanksgiving.

Detective Krum

It appears the Federal Deposit Insurance Corporation (FDIC) is in not only selling securities but, the real estate market as well.  Here is a partial list of properties “FDIC” is selling:

715 Stephens  Saginaw, Michigan  A two unit converted house for

$ 7,500 or best offer

5516 Oldtown  Detroit, Michigan A single family residence 3 bedroom 1 bath and 1250 square feet for $ 8,500 or best offer

To see more properties and get particulars on the properties listed here go to FDIC property information here.

The question is, who regulates FDIC in securities trading and in real estate sales? What law provides FDIC the ability to engage in securities and property selling?

Detective Krum

Commerce Bank of Southwest Florida failed and on Friday, November 20, 2009 Commerce Bank of Southwest Florida, Fort Myers, FL was closed by the Florida Office of Financial Regulation, and the Federal Deposit Insurance Corporation (FDIC) was named Receiver.  No advance notice is given to the public when a financial institution is closed. One must ask, why?  If you are a depositor in a bank and your deposit exceeds the FDIC insured amount, why is there no advanced notice of a failing bank?  Is it because you could withdraw your funds and protect your assets?

The official notice states:

All deposit accounts, excluding certain brokered deposits, have been transferred to Central Bank, Stillwater, MN (“assuming institution”) and will be available immediately.  On Monday, November 23, 2009, the former Commerce Bank of Southwest Florida location will reopen as a branch of Central Bank.

Your transferred deposits will be separately insured from any accounts you may already have at Central Bank for six months after the failure of Commerce Bank of Southwest Florida. Checks that were drawn on Commerce Bank of Southwest Florida that did not clear before the institution closed will be honored as long as there are sufficient funds in the account.  For more information on deposit insurance, you may speak to an FDIC representative by calling 1-800-913-5370 or visit EDIE, the FDIC’s Electronic Deposit Insurance Estimator.

The Automated Teller Machines (ATM) and online service will remain available.

As of Monday, November 23, 2009, you may continue to use the services to which you previously had access, such as safe deposit boxes, night deposit boxes, wire services, etc.

Your checks will be processed as usual.  All outstanding checks will be paid against your available balance(s) as if no change had occurred.  Your new bank will contact you soon regarding any changes in the terms of your account.  If you have a problem with a merchant refusing to accept your check, please contact your branch office.  An account representative will clear up any confusion about the validity of your checks.

All interest accrued through Friday, November 20, 2009, will be paid at your same rate.  Central Bank will be reviewing rates.  You will be notified of any changes.

Your automatic direct deposit(s) and/or automatic withdrawal(s) will be transferred automatically to your new bank.  If you have any questions or special requests, you may contact a representative of your assuming institution at your branch office.

If you or your company provided a service or product, leased space, furniture, or equipment to Commerce Bank of Southwest Florida prior to Friday, November 20, 2009 and have not been paid, you may be entitled to a claim against the bank. If you provided a product to or a service for Commerce Bank of Southwest Florida prior to the bank’s failure for which you have not been paid and you have not received communication, please contact:

Please note: There are time limits for filing a claim, your claim must be filed on or before 2/25/2010.

See FDIC’s website here -  for more information.

Detective Krum

In plain English, a derivative in real estate means a value on real estate property that was decided upon various factors.  When the banks have a percentage of their portfolio in derivatives it means the banks have loans on real estate where the loan value is based upon various factors.  What are the various factors? Tranches are one example. A Tranche is a package of loans. The bottom line? Loans were made on real property not based on fair market appraisals but on how many loans are put into a package of loans (tranches) and a speculation of what the property value should or could be (derivative).  So why am I writing about this?

I read a very good article on World Net Daily. An interesting point I want to mention is quoted.

“According to the latest numbers from the Treasury Department, JPMorgan and Goldman Sachs are holding the bag on 60 percent of the world’s derivatives – an astonishing $120 trillion between them, Still reports.

But instead of being held responsible for the collapse of the world economy, they were rewarded during the debacle by being allowed to absorb their primary competitors.”

“JPMorgan was the biggest winner in the government bailouts, after receiving a $25 billion loan, it gobbled up Bear Stearns‘ assets for about two cents on the dollar and then the assets of Washington Mutual – the nation’s largest failed bank – for less than a penny on the dollar. Goldman Sachs received approximately $50 billion, but both firms have now repaid the government.”

“According to Treasury figures at the end of June, Morgan held a staggering $80 trillion in derivative exposure, 50 times more than its $1.6 trillion in assets. Goldman Sachs is in an even more precarious condition. It holds $40 trillion in derivatives backed by assets of only $120 billion – a leverage of 333-to-1.

“To put this into perspective,” said Still, “The Gross Domestic Product of the United States is a mere $14 trillion. Even the world GDP is only $65 trillion, and the best estimate of the worth of everything in the world is only $200 trillion. That’s how big these numbers are.”

“Mega-investor Wayne Rogers is certainly not shy about identifying the problem. On “Cashing In” on the Fox News Channel Saturday, he put it this way: “Goldman Sachs is a conspiracy with the government. They are a fascist organization. They are supplying the guy who is the secretary of the Treasury, then he goes back to Goldman Sachs. Meantime he owns 800,000 shares of Goldman Sachs and Goldman Sachs gets bailed out by the government. The whole thing is outrageous. Let them go down.”

Read the rest of the article from World Net Daily here and there is a short four minute video you might find interesting.

Detective Krum

I read a question regarding the bank bailouts and thought it appropriate to use this opportunity as a teaching experience. The question is, “If the bank bailouts did not go through, who would have taken on the bad debt?”

When banks make loans to business (say auto dealers – they pay floor plan charges on each auto on their lot) If the car company went bankrupt, the bank would get pennies on the dollar in bankruptcy court. Same with banks making bad mortgage loans:
1. The bank knew better & did it anyway
2. The bank forecloses on the loan and if the homeowner filed bankruptcy, the bank gets pennies on the dollar
3. If the banks had too many bad loans, it shows the bank has poor business experience and they would file bankruptcy. Those they sold those “toxic” assets to would get pennies on the dollar.

Would you buy anything “toxic”? What does that say about your intelligence verses the bank’s intelligence?

Detective Krum

S & T Bank, based in Indiana, Pennsylvania has been downgraded by analysts and recommended a sell according to Bloomberg. S & T Bank rating is a ( D+ ) but it appears analysts see the need to sell and watch this blog to see if the bank indeed, fails.  Consider SunTrust Bank, their rating is a ( D- ) considering SunTrust Bank received about $2.2 billion.Ten major bank holding companies received bank bailouts

Among the 10 bank holding companies, Bank of America Corp. was judged in May to need $33.9 billion in additional capital under regulators’ criteria, the largest gap. Wells Fargo & Co.’s shortfall was $13.7 billion, while Citigroup Inc.’s was $5.5 billion. The Fed told banks in May to shore up reserve capital by early this month. The Federal Reserve Bank index is here.

Fifth Third Bancorp’s capital need was $1.1 billion, KeyCorp’s was $1.8 billion, PNC Financial Services Group Inc.’s was $600 million, Regions Financial Corp.’s was $2.5 billion and SunTrust Banks Inc.’s was $2.2 billion. GMAC LLC needed $11.5 billion, while Morgan Stanley’s assessment was $1.8 billion.

The bank holding companies appeared to tighten lending policies instead of lending more to help stop foreclosures. In addition, bank holding companies upped interest rates to consumers while the bank was getting the money near zero percent interest from the fed and the banks cut credit limits.  The banks claim they have paid back the bailout money. How have banks paid back taxpayers? Banks claim they have dropped their interest rates and loosened credit. Have you looked at your credit card changes? Higher interest rates and cut limits don’t show the banks claims.

What can you do to voice your displeasure with bank mismanagement? Let’s learn from the auto bailout. Customers stopped buying GM and Chrysler and Ford was rewarded for not taking bailout money with increased sales.  Looking for a bank that did not participate in the bank bailouts is an avenue many are taking.

Detective Krum

Many readers asked why the bank bailouts do not work, simple, they can’t. The bank bailouts or TARP was put into motion, as Congress said, to stimulate lending by banks to customers.  When President Bush started the bank bailouts and President Obama continued and expanded them to include auto companies, AIG, and now trying to take over health care shows elected officials out of control while we have taxation without representation.  When Congress is cowardly to stand up for freedom and our Constitution we see the need for Americans to downsize a bloated centralized power structure that does as they please.

The reason the bank bailouts cannot work is simple. Let’s suppose you are a bank and a customer comes to you for a loan, you have risk in lending to the person or company. As a bank, you notice the federal reserve is keeping interest rates near zero. Would you rather lend with risk to a customer or business or borrow money from the federal reserve (central bank) at zero percent interest and invest your loan hedging the stock market where you can make millions for yourself and others?  Banks have chosen the latter – don’t loan too much but use the TARP money to drive up the stock market as you (bank)  make a fortune. How do the banks look at customers then? As you can see, they cut credit limits on credit cards and up their interest into the 20% interest plus range.  Is that fair and the right thing to do?

Banks will say they have paid the TARP funds back – where’s my dividend check? Where did the banks get the money to pay the TARP funds back? From new lending? Or investing taxpayer dollars into the stock market creating another bubble. If you think this sounds off – then you will enjoy the new book The Dollar Meltdown. Charles explains in plain English what is going on and in an interview, Charles thinks it is too late to stop the downward spiral but shows you how to prepare to protect your assets and family.

Four things you’ll learn from The Dollar Meltdown:

WHERE WE ARE TODAY

You’ll get the whole story on America’s debt, both visible and hidden. You’ll learn how bailout bills and stimulus spending have dug us in an even deeper hole and what it means for the future.

HOW WE GOT INTO THIS MESS

You’ll learn to see old familiar patterns in some of the newest economic developments. This will help you judge the future by the past. The Dollar Meltdown lays out the real fundamentals about money and shows you exactly how the monetary system in the United States today has been corrupted so that you can avoid being victimized by it.

WHAT HAPPENS NEXT

You’ll discover how the dollar meltdown happens, the most likely scenarios, and the role of foreign creditors like China. You’ll be prepared as the authorities react to economic problems of their own making, lurching from one “solution” to the next, deepening the crisis with their every move.  The dollar meltdown will change America and you’ll want to be ready for it when it comes.

WHAT YOU NEED TO DO

There is opportunity in every crisis and there are ways protect yourself and your family and to profit in the turbulent times ahead.

You see why the old rules don’t work anymore and you’ll get easy-to-understand investment advice for the new rules, specific investment recommendations that you can put to use right away to protect yourself and your family from the dollar meltdown.

Don’t wait until it’s too late! Order your copy of THE DOLLAR MELTDOWN HERE – Do it TODAY!

About Charles Goyette

Charles Goyette has long been known in Phoenix as “America’s Most Independent Talk Show Host!” With years of hands-on experience as an investment professional, he brings a welcome dimension of foresight and clarity to his political and economic commentary.  Goyette has been called on often to share his views with television audiences nationally on CNN, Fox News, MSNBC, and PBS, including on “The O’Reilly Factor,” the popular PBS program “NOW with Bill Moyers,” and as a frequent guest on “Lou Dobbs Tonight” on CNN, repeatedly warning before the current economic turmoil of the “economic calamity the Republicans and Democrats” were creating.

Detective Krum

There is an Alarion Bank spoof going on and our readers need to be warned of this spoof.  You may receive an email stating the following:

“Dear Alarion Bank Customer,

As part of our security measures, we regularly screen activity in the system.
We recently contacted you after noticing an issue on your account.
We requested information from you for the following reason:

- We have observed activity in this account that is unusual or potentially high risk.

Please download the form attached to this email and open it in a web browser.
Once opened, you will be provided with steps to restore your account access.
We appreciate your understanding as we work to ensure account safety.

Sincerely,

©2009 Alarion Bank. All rights reserved.”

Included in this email is a file for you to download the “form”. I suggest if you receive one of these emails you should contact Alarion Bank at   1.888.900.9785 and inform them of the email. There is a high probability, the “form” the email wants you to download will hijack your computer and could infect your computer with a virus, rootkit or key logger. Alarion Bank is aware of the problem and has issued a Fraud Alert, see below:

Fraud Alert
Alarion Bank has received reports of a fraudulent “phishing” scam involving fake e-mail messages delivered on or about 11/06/2009 that appear to come from Alarion Bank, often with the subject line “Official Notification” or “Notification ID.” DO NOT RESPOND TO OR CLICK ANY LINKS IN THESE MESSAGES. Simply delete them.

One other point – Alarion Bank is located in Ocala, Florida and has a (D+) bank rating.

Detective Krum

Ten more banks were closed on Friday October 30, 2009.

October 2009 saw 20 banks fail. That makes the total failed banks for 2009 – 116.  Consider, 27 banks failed from the year 2000 through 2007  making an average of 3.9 bank failures per year. When TARP was passed by Congress and arm twisting began in Congress to pass massive bank bailout money to selected banks, bank failures skyrocketed in 2008 and 2009.

Was the bank bailout money designed to squeeze out smaller banks by bailing out  bigger banks whose CEO just happened to be politically connected?  Large bank stock is inching upwards and profits to upper-management through bonuses is becoming a trend. Consider 26 banks failed in 2008 and now 116 in 2009. Makes you wonder if the large banks were allowed to fail, maybe the smaller banks would not have failed, doesn’t it?

Add the following banks to the list of bank failures for 2009:

If you have investment products, in a bank, your investments are not insured by FDIC according to FDIC.  As usual, FDIC waits until Friday to close ten more banks.  One might ask, in whose best interest is it to wait until late on a Friday to close a bank?

Detective Krum

Total bank failures so far for 2009? 106  Three of the latest bank failures – Florida.  Partners Bank located in Naples, Florida  Hillcrest Bank, also in Naples, Florida and Flagship National Bank of Sarasota, Florida.  Minnesota and Wisconsin felt the bank failure sting as well. Riverview Community Bank located in Otsego, Minnesota and Bank of Elmwood in Racine, Wisconsin failed.

The bank failure list continues to grow in spite of Congress’ claim of saving banks through bailouts.  One might ask, ‘What banks did the American taxpayer bailout?  Is there a connection between the banks bailed out and Congress representatives? ‘  106 bank failures in ten months – AFTER – bank bailouts leads our readers to ask – What was the purpose of the bailout money?

Here is a copy of the press release.

First Federal Bank of Florida, Lake City, Florida, Assumes All of the Deposits of Flagship National Bank, Bradenton, Florida

Flagship National Bank, Bradenton, Florida, was closed today by the Office of the Comptroller of the Currency, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with First Federal Bank of Florida, Lake City, Florida, to assume all of the deposits of Flagship National Bank.

The four branches of Flagship National Bank will reopen on Monday as branches of First Federal Bank of Florida. Depositors of Flagship National Bank will automatically become depositors of First Federal Bank of Florida. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship to retain their deposit insurance coverage. Customers should continue to use their existing branch until they receive notice from First Federal Bank of Florida that it has completed systems changes to allow other First Federal Bank of Florida branches to process their accounts as well.

This evening and over the weekend, depositors of Flagship National Bank can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.

As of August 31, 2009, Flagship National Bank had total assets of $190 million and total deposits of approximately $175 million. First Federal Bank of Florida did not pay the FDIC a premium for the deposits of Flagship National Bank. In addition to assuming all of the deposits of the failed bank, First Federal Bank of Florida agreed to purchase essentially all of the assets.

Detective Krum

San Joaquin Bank in Bakersfield, California failed October 16th and makes the 99th bank failure in 2009.  FDIC, in need of its own bailout, posted the following information:

San Joaquin Bank, Bakersfield, California, was closed today by the California Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. FDIC entered into a purchase and assumption agreement with Citizens Business Bank, Ontario, California, to assume all of the deposits of San Joaquin Bank.

The five branches of San Joaquin Bank will reopen on Monday as branches of Citizens Business Bank. Depositors of San Joaquin Bank will automatically become depositors of Citizens Business Bank. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship to retain their deposit insurance coverage. Customers should continue to use their existing branch until they receive notice from Citizens Business Bank that it has completed systems changes to allow other Citizens Business Bank branches to process their accounts as well.

This evening and over the weekend, depositors of San Joaquin Bank can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.

As of September 29, 2009, San Joaquin Bank had total assets of $775 million and total deposits of approximately $631 million. Citizens Business Bank did not pay the FDIC a premium for the deposits of San Joaquin Bank. In addition to assuming all of the deposits of the failed bank, Citizens Business Bank agreed to purchase essentially all of the assets.

The FDIC and Citizens Business Bank entered into a loss-share transaction on approximately $683 million of San Joaquin Bank’s assets. Citizens Business Bank will share in the losses on the asset pools covered under the loss-share agreement. The loss-share arrangement is projected to maximize returns on the assets covered by keeping them in the private sector.

Detective Krum

I know this may be a bit off topic from my normal posts however, I have looked at the treaty and some other information and felt it necessary to save our Republic, this needed to be posted. The following information has been provided to me and is not my original work but the source is credible.

Below is a picture of President Barrack Hussein Obama appearing in Copenhagen and follow the story and download a copy of the treaty. Remember, a treaty can be signed by a president and America would be bound to the treaty. Reuters reports 3 scenarios here.

President Obama's 1st Copenhagen Trip

Obama’s last visit to Copenhagen didn’t work out so well for the USA.

The Minnesota Free Market Institute hosted an event at Bethel University in St. Paul on Wednesday evening. Keynote speaker Lord Christopher Monckton, former science adviser to British Prime Minister Margaret Thatcher, gave a scathing and lengthy presentation, complete with detailed charts, graphs, facts, and figures which culminated in the utter decimation of both the pop culture concept of global warming and the credible threat of any significant anthropomorphic climate change.

A detailed summary of Monckton’s presentation will be available here once compiled. However, a segment of his remarks justify immediate publication. If credible, the concern Monckton speaks to may well prove the single most important issue facing the American nation, bigger than health care, bigger than cap and trade, and worth every citizen’s focused attention.

Here were Monckton’s closing remarks, as dictated from my audio recording:

At [the 2009 United Nations Climate Change Conference in] Copenhagen, this December, weeks away, a treaty will be signed. Your president will sign it. Most of the third world countries will sign it, because they think they’re going to get money out of it. Most of the left-wing regime from the European Union will rubber stamp it. Virtually nobody won’t sign it.

I read that treaty. And what it says is this, that a world government is going to be created. The word “government” actually appears as the first of three purposes of the new entity. The second purpose is the transfer of wealth from the countries of the West to third world countries, in satisfication of what is called, coyly, “climate debt” – because we’ve been burning CO2 and they haven’t. We’ve been screwing up the climate and they haven’t. And the third purpose of this new entity, this government, is enforcement.

How many of you think that the word “election” or “democracy” or “vote” or “ballot” occurs anywhere in the 200 pages of that treaty? Quite right, it doesn’t appear once. So, at last, the communists who piled out of the Berlin Wall and into the environmental movement, who took over Greenpeace so that my friends who funded it left within a year, because [the communists] captured it – Now the apotheosis as at hand. They are about to impose a communist world government on the world. You have a president who has very strong sympathies with that point of view. He’s going to sign it. He’ll sign anything. He’s a Nobel Peace Prize [winner]; of course he’ll sign it.

[laughter]

And the trouble is this; if that treaty is signed, if your Constitution says that it takes precedence over your Constitution (sic), and you can’t resign from that treaty unless you get agreement from all the other state parties – And because you’ll be the biggest paying country, they’re not going to let you out of it.

So, thank you, America. You were the beacon of freedom to the world. It is a privilege merely to stand on this soil of freedom while it is still free. But, in the next few weeks, unless you stop it, your president will sign your freedom, your democracy, and your humanity away forever. And neither you nor any subsequent government you may elect will have any power whatsoever to take it back. That is how serious it is. I’ve read the treaty. I’ve seen this stuff about [world] government and climate debt and enforcement. They are going to do this to you whether you like it or not.

But I think it is here, here in your great nation, which I so love and I so admire – it is here that perhaps, at this eleventh hour, at the fifty-ninth minute and fifty-ninth second, you will rise up and you will stop your president from signing that dreadful treaty, that purposeless treaty. For there is no problem with climate and, even if there were, an economic treaty does nothing to [help] it.

So I end by saying to you the words that Winston Churchill addressed to your president in the darkest hour before the dawn of freedom in the Second World War. He quoted from your great poet Longfellow:

Sail on, O Ship of State!
Sail on, O Union, strong and great!
Humanity with all its fears,
With all the hopes of future years,
Is hanging breathless on thy fate!

Skimming through the treaty, I came across verification of Monckton’s assessment of the new entity’s purpose:

38. The scheme for the new institutional arrangement under the Convention will be based on three basic pillars: government; facilitative mechanism; and financial mechanism, and the basic organization of which will include the following:

World Government (heading added)
a) The government will be ruled by the COP with the support of a new subsidiary body on adaptation, and of an Executive Board responsible for the management of the new funds and the related facilitative processes and bodies. The current Convention secretariat will operate as such, as appropriate.

To Redistribute Wealth (heading added)
b) The Convention’s financial mechanism will include a multilateral climate change fund including five windows: (a) an Adaptation window, (b) a Compensation window, to address loss and damage from climate change impacts [read: the "climate debt" Monckton refers to], including insurance, rehabilitation and compensatory components, © a Technology window; (d) a Mitigation window; and (e) a REDD window, to support a multi-phases process for positive forest incentives relating to REDD actions.

With Enforcement Authority (heading added)
c) The Convention’s facilitative mechanism will include: (a) work programmes for adaptation and mitigation; (b) a long-term REDD process; © a short-term technology action plan; (d) an expert group on adaptation established by the subsidiary body on adaptation, and expert groups on mitigation, technologies and on monitoring, reporting and verification; and (e) an international registry for the monitoring, reporting and verification of compliance of emission reduction commitments, and the transfer of technical and financial resources from developed countries to developing countries. The secretariat will provide technical and administrative support, including a new centre for information exchange [read; enforcement].