HALF-FULL REPORT 12/09/11

Why didn’t I ever think to call Russian dictator Vladimir Putin The Gremlin In The Kremlin?  It took the London Telegraph to come up with the cleverest headline of the week.  At last, Russians are realizing what a punk Putin is, who tries so achingly hard to be a macho-man.  (You know I have personal experience over what a lightweight he is.)

Even though the Kremlin engineered massive vote-rigging in last Sunday’s Duma (Russian Parliament) elections (12/04), Putin’s United Russia party barely managed to come out on top.  Tomorrow (12/10), protest demonstrations demanding real elections and an end to Putinocracy are scheduled to take place all across Russia from Kaliningrad on the Baltic Sea to Vladivostok on the Pacific Ocean.

60,000 Muscovites have pledged on Facebook and other social networks to show up in Red Square to demand an end to "the Party of Swindlers and Thieves" – what they call United Russia – ruling their country.  Last Monday (12/05), when 5,000 protestors appeared there, they got water-hosed and the crap beat out of them.

Pooty-poot’s cage has been so rattled he’s scapegoating Hillary Clinton as the instigator of the protests against him.  In response, she announced the US will proceed with its planned missile defense system in Europe despite Russia’s vehement objections.  The US supports "the aspirations of the Russian people," she said with everyone knowing she meant "not the aspirations of Mr. Putin."

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Putin, however, wasn’t the only one Hillary ticked off this week.  She managed to infuriate dozens of governments all over the world with a speech in Geneva on Tuesday (12/06), declaring it is now a priority of the US government to force a radical pro-homosexual agenda upon them.

The government of Nigeria was one, which is in the process of ensuring that homosexual "marriage" remains illegal.  Advocacy of it by Mrs. Clinton is "very offensive to African culture, tradition and to the way we live our lives here," responded Nigerian Information Minister Labaran Maku.  "Our democracy will be guided by Nigerian law and values and we will not allow any nation to dictate to us how we run our independent and democratic nation."

On the day of Mrs. Clinton’s declaration, Gov. Rick Perry issued his own:  "As president, I’ll end Obama’s war on religion – and I’ll fight liberal attacks on our religious heritage."  You can bet he will.

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Meanwhile, the hammering of Newt continues.  Victor Davis Hanson denounced his "laughable hypocrisy" for getting paid $1.6 million to lobby for the most corrupt agencies in Washington, Fannie/Freddie.  George Will eviscerated him: "Gingrich embodies the vanity and rapacity that make modern Washington repulsive."  And Debbie Schlussel dismisses him as a "global warming pimp."

What’s really gone viral, though – particularly in Iowa – is this video hit comparing Newt’s values to those of Kim Kardashian.  Ouch!

 
It won’t be long now until folks in Iowa and elsewhere stop being stuck on stupid regarding Gingrich.  Maybe they might even start getting stuck on smart regarding Perry.

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In the Good News Dept., finally a lawyer gets paid what he deserves.  $1.50.  The case serves to highlight the asininity of the law today. 

Some thug in a New York maximum-security prison sued the guards for touching his "sacred" hair – he’s one of these "Rastafarians," the guys with the filthy dreadlocks who believe Haile Selassie of Ethiopia (his other title was Ras Tafara) is the Second Coming of Christ.  Some moocher lawyer ran up $75K in "billable hours" prosecuting the prison and expected state taxpayers to pay his bill.

The US Circuit Court of Appeals gave him $1.50 instead – and the Rasta prisoner $1.  So it’s fun that they got the finger from the court.  But it’s ludicrous that such cases are allowed to even exist at all.

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It’s a contest as to who should be the HFR Hero of the Week.  We report, you decide. 

First, there’s Wisconsin Gov. Scott Walker, who on Wednesday (12/07) signed a Castle Doctrine bill granting legal immunity to anyone who kills an intruder who breaks into his home, workplace, or vehicle.

Second, there’s French Youth Minister Jeannette Bougrab, who is an Arab from Algeria when it was a French colony.  In an interview with Le Parisien (12/03), she denounced Moslem Sharia law as an "inevitable restriction on rights and freedoms," and thus there could be no such thing as "moderate" Sharia Islam:  "There are no half-measures with Sharia."

Third, there’s Wisconsin Congressman James Sensenbrenner, who threatened Attorney General Eric Holder with "impeachment" to his face at a hearing yesterday (12/08).  At last, a hint of courage from a Pub. 

It was just a hint, a trial balloon, but it’s a sign that the Pubs are realizing that 1) Fast & Furious really is a revoltingly immoral scandal, and that Holder really is a lying scumbag, and 2) a formal Impeachment proceeding by the House is the only way to force public attention on it.

They realize that it would be a purely political exercise, for impeachment is just the indictment.  The trial is held by the Senate, and the Dem majority would never vote to convict him.  In truth though, Holder belongs in jail, not just removed from office.  We’ll have to wait for a Perry Justice Dept. to prosecute him and go for that.

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Now for the HFR Word of the Week.  Rehypothecation.  It’s literally a trillion-dollar word.  To understand why, we need to talk about Cameron and Corzine.

British Prime Minister David Cameron is being hailed today (12/09) for telling Merkozy – that’s Merkel and Sarkozy combined – to stuff their flim-flam treaty – he won’t sign it.  Why in the world should the UK – which has the pound, not the euro; it’s in the EU but not the eurozone – bankrupt itself for the totally lost cause of rescuing a doomed foreign currency?  So cheers for him.

Every effort to keep the euro afloat involves an increasing obliteration of national sovereignty of European countries, turning over control of their budgets and most every aspect of their economies to bureaucrats in Brussels.  It’s the destruction of democracy by bureaucracy, as described by Richard Rahn this week.

Cameron rightfully would have no part of it.  We need, however, to take a closer look at his rationale.  It was, he said, "to save The City."  His public position is that Merkozy was demanding the right to regulate Britain’s Wall Street – known as London’s "The City."  Fair enough, Merkozy has no right to.

But something is going on in The City that is nightmarishly dangerous, a multi-multi-trillion dollar scam that Cameron does not want exposed or threatened.  The scam is called rehypothecation.  Here we go.

"Hypothecation" is a banker’s term, referring to collateral owned by a borrower but "hypothetically" owned by the lender, who can take possession of it if the borrower defaults.  Re-hypothecation is that lender using the hypothecated collateral to finance borrowings of his own.  If unchecked, this can quickly lead to a daisy-chain of infinite re-re-hypothecations, exponentially expanding borrowing on the original collateral.

US Federal Reserve and SEC rules provide that check:  the maximum a lender (or "prime broker") can rehypothecate is 140% of the borrower’s collateral.  The UK – and thus London’s City – have no such rules, no such check.  Collateral can be rehypothecated over and over and over again to the moon with no limit.

Wonder why Jon Corzine, the wizard who ran Goldman Sachs before he became Senator then Governor of New Jersey (finally tossed out of office by Chris Christie), testified to Congress yesterday (12/08) regarding MF Global’s missing $1.2 billion,  that "I simply do not know where the money is"?  How can the guy not know where the hell one billion two hundred million dollars belonging to his company is?

Because MF Global, like any number of Wall Street firms, set up a UK subsidiary in The City and rehypothecated their clients’ money straight out into space.  Corzine really doesn’t know. His clients’ $1.2 billion has vanished into rehypothecated thin air.  Like trillions of other dollars, pounds, and euros.

The scam has been revealed this week (12/07) by the Securities Law reporter for Reuters, Christopher Elias, in MF Global and the Great Wall Street Re-Hypothecation Scandal.  Your brain and bowels will explode upon reading it.  Try this.  Every MF Global client signed an agreement when they turned over their money to Corzine containing this clause:

 "7. Consent To Loan Or Pledge. You hereby grant us the right, in accordance with Applicable Law, to borrow, pledge, repledge, transfer, hypothecate, rehypothecate, loan, or invest any of the Collateral, including, without limitation, utilizing the Collateral to purchase or sell securities pursuant to repurchase agreements [repos] or reverse repurchase agreements with any party, in each case without notice to you, and we shall have no obligation to retain a like amount of similar Collateral in our possession and control." 

Sorry, suckers. 

But it’s much worse. Elias goes on to describe a process of hyper-rehypothecation engaged in by all the big boys in the US, Canada, and Europe which has created "the world’s largest ever credit bubble."  When the bubble pops, it will be apocalyptic.  Better be buying as much physical gold and junk silver as you can, folks.

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I’m sure you feel you need at least three fingers of Famous Grouse about now, or a large Riedel goblet of your favorite red.  I have to admit I’m indulging in the latter.  So let me tell you a quick story.

I was talking to a TTPer friend a couple of days ago.  I asked him how his kids were.  He started out telling me how is younger ones where doing in school, and then he got to his oldest daughter who’s in her 20s.  A while ago she had augured herself into a bad way.  No job, no prospects, really bleak.  Many of us have been there.

Today, her life is turned around.  She found a good job doing something that makes her happy and productive.  Her depression has turned into optimism.  Her entire outlook on life, and her health, have been transformed for the better.  What made the difference, I asked.

His answer:  Dr. Joel Wade.

He had read Joel’s columns over the years, but he admitted, not paid much attention to Joel’s life coaching offers appended at the end.  But his daughter was in a bad way.  What could he do to help her?  This was his child and her life was hurting.  Joel’s coaching offer finally caught his eye.  He decided to gift his daughter with a series of phone consultations with Joel – and the rest is history.

"It was the best investment I ever made as a father," my friend said.  "I had no idea Joel was so extraordinary.  I can’t thank him enough."

We are all in difficult times now, as is our country.  Joel may be able to help.  His life-coaching really does work.  I’d like to suggest you consider it. 

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OK, folks. That’s it for the 49^th week of 2011.  Three weeks to go before the most consequential year of our country’s life.  Time to start enjoying what’s left of this year.