Secrets of an Iran Contra Insider
by Al Martin
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by Al Martin
No Confidence; Bush Cabal Drives US to the Brink of Collapse
(July 22) Another week has passed, as we inch ever closer to the economic collapse of the United States. During this week we have reached several new important milestones. Another $750 billion of market capitalization has been lost, thus bringing the total loss in market capitalization (during the eighteen months of the George Bush II Regime) to $4.75 trillion.
In an effort to stave off an economic collapse of its own creation, the Bush Administration desperately continues to bang the drum on the so-called positive economic numbers. The gross domestic product of the United States is expected to grow between 3-1/2 and 3-3/4 % for the entire year. Corporate profits are expected to pick up during the second half of this year. Yet these numbers continue to be ignored by the investing public. The reason it is being ignored is because the Bush Administration, with its incessant, waste, fraud, abuse, graft, corruption and malfeasance, isn't fooling anybody anymore.
For instance, we must remember that most of the government economic statistics that are released by various federal agencies are in fact all lies. That's why these numbers are endlessly revised after they are issued. In some cases, revisions are made up to six months later.
The way the government puts together these statistics is fundamentally flawed. When the Clinton Administration attempted to make a general overhaul of the way government agencies compiled statistics and data, the Republicans fought them tooth and nail. They knew that if the monthly government statistics were going to tell the truth, it would paint a very dire picture.
The White House has been putting on Republican market pundits on CNBC and FNN, virtually hour after hour, to try to pump up investor confidence. They say that the Dow Jones industrial average at its current levels has discounted all of the accounting scandals and Republican connected fraud yet to come.
Isn't it odd that the Bush Administration which professes to know nothing about this inherent accounting fraud and fraud connected to itself says that in six months time this will all be weeded out?
But if they don't know anything about it, how can they give a time frame?
The reason why is because they already know which corporations have accounting problems and which corporations have committed Republican-connected fraud which hasn't been revealed yet.
That's why they can give a time frame. That in itself implies that the White House must be controlling the agenda. They must be controlling the rate and pace of discovery of these frauds. They couldn't give a time frame otherwise.
In other words, if there are two hundred more major frauds to be revealed, then maybe the White House has a plan that will gradually reveal the frauds over six months time, so the market doesn't crash right away.
The market will then have time to absorb the bad news.
As we have discussed before, the next two shoes to drop (that will hit the capital marketplaces like a bombshell and dampen investor enthusiasm even further) is the corporate pension fraud. There is an aggregate of probably some number in the trillions of dollars that American corporations owe their own pension funds.
This was recently revealed when General Motors made the admission that it has a $3.6 billion deficit in its fixed pension fund. Ford, Chrysler, and General Electric-all have enormous multi-billion fixed deficits. And that's only the tip of the iceberg.
In the future, any corporations that have any shortfalls in their pension plans are going to have to make provisions to use corporate profits to replenish those funds.
The reason those pension frauds were allowed to exist is that both during the Reagan Bush I Regime, and now the Bush II Regime, they consistently weakened regulatory statutes regarding corporate pension funds. They gave corporations more leeway and more time to replenish the money. More tax write-off, more depreciation and so on. It has been the Bush Cabal, which has created this corporate pension problem. That's the first shoe to drop next.
The next one (which nobody is talking about, which Al Martin Raw.com is now revealing) is that this market slide and the corporate collapses of Enron, WorldCom, and Global Crossings etc. have created thus far (and the process isn't completed yet) $500 billion in bad loans for American banks.
Very little, if any, of this money will be recovered. The banks will simply have to write the money off. This is at a time when personal bankruptcies are at all time highs and continue to increase. This is a time when banks are already writing down record amounts of consumer debt. Now they're going to get hit with a double whammy of this newly created corporate bad debt.
Nobody has talked about what the impact of this to the marketplace and to our economy is going to be. Therefore, this is why the market continues to decline -- despite some seemingly bright spots.
(Parenthetically speaking, would Al Martin Raw readers be interested in a financial newsletter, or a course on what the so-called Smart Money Crowd is doing - shorting the market? Please email your response to email@example.com)
You see all these Republican Cabalists -- George Bush, Dick Cheney and Jack Welch, the retired chairman of General Electric (who is now being investigated for problems at GE Capital Credit, overstating profits, etc) standing up on the podium telling us to keep waving the American flag, and don't worry about your IRA statements. You just keep on buying stock.
At the same time, these people (the Smart Money) are shorting the market and converting their trading profits into gold. That bespeaks volumes. It's one thing to tell the American people to go out and keep buying, while the Bush Cabalists are being short. Of course, there is nothing wrong with that. But it is very onerous when they start converting their profits into gold and start getting out of dollars.
The Smart Money has been shorting the market, converting their trading profits to gold through offshore gold accounts, principally held at the LME or in Zurich. There is a whole vast array of offshore accounts. People tend to think that offshore accounts are just used to hold money, for US dollars or whatever. But you can convert that to any form of currency, Euro-dollars at LIBOR rate (London Interbank Offshore Rate) or whatever. Or you can put your currency in offshore bullion accounts, where you can buy and hold bullion through a Swiss bank in an offshore account.
And how fast is the market being brought down? There are two schools of thought about that. Do you bring it down fast and hard and try to convince the American people that this is the bottom and now it's time to buy again? Or do you bring it down gradually?
Obviously you have to do it gradually. Since so much investor confidence has been lost, if the Bush Administration brought the market down fast and hard and said here's the bottom, nobody's going to believe them.
Therefore what you do (as the Bush Administration has done) is you put all your economic pundits on television and you resort to the classic strategy of letting the market drop slowly. Then you keep telling the American people to just keep putting your money into your IRA and 401(k) plan, and remember that every month as the market drops, you're averaging down. You're getting the benefit of being able to buy stocks at ever-cheaper prices. Then when the market does turn around, you'll be in the black again even more quickly.
That is the classic strategy. And the funny thing is that polls indicate that 80% of the American people swallow that stupid line. What they don't understand (these classically oriented investors with this idea of averaging down which has always been popular in this country -- and you can't expect them to understand because they're not being told) is that we have entered a whole new environment, that everything is falling apart, and that it isn't going to come back. And that's what I want the people to understand.
The reason that the market hasn't crashed already (and you hear this all the time; you hear it every hour on the hour on CNBC et al) is because there has not been a lot of retail selling - all through this decline. The people are so conditioned by the Bush Cabal into the concept of holding stocks to the bitter end -- and continuing to buy them all the way down.
It is laughable, but the Bush Administration in concert with their allies in the securities industry, the mutual fund industry and so on, has gotten the people snowed into thinking this. In the past this strategy has always worked.
When you've come into a bear market, you've averaged down. Then when the market turns around you've made money. But this time, what the people don't understand is that the fundamentals have all changed. And what do we mean when we say that? It's simple. Everything is falling apart. And this time it ain't coming back.
Why do you think the Smart Republican Money IS shorting the market and IS using that money to buy gold?
Why do you think records indicate that Smart Republicans have even begun selling their private homes-if they're worth two to five million dollars in this country? They're gradually and quietly moving everything out of the United States and putting everything into gold and getting themselves in the Cayman Islands where they can be completely isolated from the rest of the events in the world.
There are even whispers in Washington that the administration has secretly told the Treasury Department to begin to prepare for the Emergency Economic Collapse Protocols. This would entail a partial repudiation of US debt. After that, everything would then effectively collapse. This has always been a state secret unbeknownst to most people.
The United States holds approximately the same amount of gold bullion (and it tinkers very little with that amount) -- eleven billion ounces of gold. When you add that eleven billion of ounces which it has on hand and about a billion ounces of gold, which could be recovered from industrial uses, the United States would be able to print a limited series of US currency as gold-backed notes. This currency would circulate only in the United States. It would not circulate anywhere else. It would be an internal currency only. It would be meant to keep the nation operating in a post-economic collapse environment.
In other words, you would still need currency, a form of currency which people still had faith in, because faith in all Federal Reserve notes would be gone. That would be history. They wouldn't be worth anything.
This is part of the actual protocol. The United States would instantly demonetize US banknotes held outside of the United States, money held in physical form. The Treasury Department would certify these banknotes as demonetized and no longer of any value. As a matter of fact, at that time, they become even illegal to possess.
What would happen in an emergency collapse situation? The United States would simply demonetize all currency outside the United States - which is about two-thirds of all US currency outstanding. It is used in many third world nations as the currency of last resort.
We could effectively demonetize the currency without a lot of repercussions. Certainly -- in a post-collapse environment, where are the repercussions going to come from?
The administration may already be looking at post-collapse protocols. The first historical precedent would be the events of 1862, when the US Government first began issuing a "national" currency. There was an enormous debate at the time.
Lincoln, Seward and Chase (then Treasury Secretary Salmon P. Chase) had an interesting debate about it. Chase, the former Senator from Ohio, thought that the American people would actually accept the use of a non-species-backed national note - especially if you hit them from the angle of "patriotism."
If they said that we are entering into a War with the South, the North will need all of its gold reserves in order to fight this war because war's expensive and it drains gold. And therefore we are going to have to be patriotic, and we are going to need to use a new national currency, not as a substitution, but to augment the privately issued banknotes then in circulation.
It wasn't until 1865 that the US Government ordered all private banknotes withdrawn from circulation and demonetized. That was the first precedent for the acceptance of a de facto fiat-based currency.
The reverse of that came in 1933 when the United States was right on the edge of collapse, and Roosevelt instituted what Republicans called "the Raw Deal," (not to be confused with the "New Deal") when he forcibly recalled all gold coins from circulation.
Roosevelt duped the American people by a careful play on words that it was illegal to hold gold, when in fact it wasn't, he just made the people think it was.
The Roosevelt Administration also had a contingency plan that had the United States collapsed they would have had to go back to species.
After all, this will have been the first time that the thirty-somethings have been fleeced. The difference now is that Americans who have invested heavily in the stock market are not being fleeced anymore; they are being skinned. They are being boiled in oil.
There is no more shearing of the sheep. The wool is gone, and now it's time for the skinning.
This is directly related to the Wall Street Journal article about the growing number of people, who are becoming savvier and are beginning to short the market and to trade from the short side. There is a growing increase in retail short selling. This is a whole new phenomenon.
Short selling was always something that the American people were always told to stay away from. That's for professionals. That's for people who know what they're doing. The reason the government and its allies in the brokerage industry always told the American people that is they didn't want to let the cat out of the bag.
They wanted to reserve the big short selling for themselves. After all, most Republican Big Money was built on the short side. If you let all the peons into it, then you'd create an enormous amount of volatility.
If you're going to have everybody shorting, you have to have somebody on the other side of the market buying. The other side of the market has traditionally been the American People. It is the American People who always go long. In other words, buy stocks and stay in there. They are the ones who provide the liquidity for the marketplace, so the Smart Republican Money can always be on the other side.
After all, George Bush didn't call the American People "fodder units" for nothing. This is called "cracking the code" of the Bush Cabalists. When you see "OFU", what did that mean? It took a while, but we finally figured it out - "One Fodder Unit."
The latest development is that foreign leaders are quietly pressuring Bush and Cheney both to resign -- as a first step in restoring market confidence. Dennis Hastert has already publicly stated that he would recuse himself from the constitutional succession. And who could the next "president" be? It could be Colin Powell. People still have confidence in him. And it would go directly in the "Five Days in May" scenario.
Powell has already hinted in the past that although he did not seek the presidency, if he were to become president, he would follow the Clintonian policies of fiscal restraint.
Of course, this scenario is very unlikely, but it does make sense for them to resign as a first step in restoring market confidence. If Powell did ascend to the presidency, it would restore market confidence. People would think that since the Bush Cabal and the Bush-Cheney Republican oil-swindling crowd were out, and Colin Powell was in, who is really a Republican in name only, things would get better.
Of course the Bush Cabal would let everything collapse before they would resign. Collapse wouldn't affect George Bush or Dick Cheney. They'll still be having their filet mignon and lobster tail lunch the next day - even if everything collapsed.
If they did resign, it would be a good first step in restoring market confidence. Maybe it's time for a new campaign to start. You could call it ABB - Anybody But Bush.
(By the way, while the American people are seeing the value of their 401(k)/IRA accounts dropping at the rate of 5% a month, Congress has voted itself another $5000 pay raise for the fourth straight year (an aggregate increase of $20,000 in four years.) Just a little closing comment to brighten up the day of the average American investor…)
AL MARTIN is America's foremost whistleblower on government fraud and corruption. A retired US Navy Lt. Commander and former officer in the Office of Naval Intelligence, he has testified before Congress (the Kerry Committee and the Alexander Committee) regarding Iran-Contra. Al Martin is the author of "The Conspirators: Secrets of an Iran Contra Insider" (2001, National Liberty Press, $19.95; Toll FREE order line: 1-866-317-1390) He lives at an undisclosed location, since the criminals named in his book have been returned to national power and prominence. His column "Behind the Scenes in the Beltway" is published regularly on Al Martin Raw: Criminal Govt Conspiracy (http://www.almartinraw.com)
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