Scandal: Greece To Receive "Negative" Cash From "Second Bailout" As It Funds Insolvent European Banks

From Zero Hedge, by Tyler Durden 02/22/2012

Earlier today, we learned the first stunner of the Greek "bailout package", which courtesy of some convoluted transmission mechanisms would result in some, potentially quite many, Greek workers actually paying to retain their jobs: i.e., negative salaries. Now, having looked at the Eurogroup's statement on the Greek bailout, we find another very creative use of "negative" numbers. And by creative we mean absolutely shocking and scandalous. First, as a reminder, even before the current bailout mechanism was in place, Greece barely saw 20% of any actual funding, with the bulk of the money going to European and Greek banks (of which the former ultimately also ended up funding the ECB and thus European banks). Furthermore, we already know that as part of the latest set of conditions of the second Greek bailout, an 'Escrow Account" would be established: this is simply a means for Greek creditors to have a senior claims over any "bailout" cash that is actually disbursed for things such as, you know, a Greek bailout, where the money actually trickles down where it is most needed - the Greek citizens. Here is where it just got surreal. It turns out that not only will Greece not see a single penny from the Second Greek bailout, whose entire Use of Proceeds will be limited to funding debt interest and maturity payments, but the country will actually have to fund said escrow! You read that right: the Greek bailout #2 is nothing but a Greek-funded bailout of Europe's insolvent banks... and the Greek constitution is about to be changed to reflect this!

The smoking gun quote:

The Eurogroup also welcomes Greece's intention to put in place a mechanism that allows better tracing and monitoring of the official borrowing and internally-generated funds destined to service Greece's debt by, under monitoring of the troika, paying an amount corresponding to the coming quarter's debt service directly to a segregated account of Greece's paying agent.

As for the priority of payments - it is more than clear:

Finally, the Eurogroup in this context welcomes the intention of the Greek authorities to introduce over the next two months in the Greek legal framework a provision ensuring that priority is granted to debt servicing payments. This provision will be introduced in the Greek constitution as soon as possible.

So there you have it: the Second Greek bailout is nothing but the first Greek bailout of Europe's banks! And the Greek constitution is about to be changed to reflect that.

Congratulations Greece - you just got royally raped by your own unelected rulers and you didn't even know it.

Full Eurozone document (source).

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Merkel Is Leading Germany Into The Austerity Abyss

From The Business Insider: 

Despite weakening economic growth and industrial production in recent months, Germany continues to look much better than the rest of Europe on the surface.
It boasts a very low unemployment rate (although über-low-wage work has grown tremendously) and relatively small public deficits.
However, none of that is stopping Merkel and her administration from betting their re-election on the fact that they can implement significant austerity in the next 2 years, while also containing the Euro crisis, and "lead by example".
Sven Böll, Peter Müller and Christian Reiermann report for Der Spiegel:

Just how healthy German finances are was revealed at the beginning of last week, in the form of an early-warning report by the European Commission. Germany was the only large country to be given an almost perfect grade.

And yet, if Merkel and Schäuble have their way, the country many in Europe already see as a model of sound budget management will become even more exemplary. "We cannot expect Greece and the other crisis-stricken countries to accept more and more austerity measures, while nothing changes in Germany," says a close associate of the chancellor.

As such, Merkel and Schäuble want to significantly ratchet up consolidation efforts. The 2013 budget, currently being prepared at the Finance Ministry, will include many billions in savings. In addition, the last stage of the so-called debt brake -- Germany's constitutionally anchored law regulating state borrowing -- will be brought forward by two years instead of going into effect as planned in 2016. Measures under discussion include cuts in social benefits and a reduction in government services. Merkel and Schäuble believe that Germany can only remain credible in the euro crisis by demonstrating that it is not simply reaping the benefits of past efforts. Germany wants to lead by example.

In other words, the German populace is about to find out just how destructive austerity can be to an economy when the world is in the midst of an ongoing Depression, in a system that values credit creation above all else. Of course, the most immediate threat to the Germany economy is financial contagion when (again, not if) Greece exits the Eurozone, which will certainly be within 0-2 years. Merkel is also betting that this will now be contained, primarily due to the ECB's LTRO programs (the second one to occur in a week). If you ask me, that's a lot of losing bets she's placing on the table. Back to the austerity:

It's an ambitious goal. To achieve it, the coalition will have to adhere to strict austerity rules in the current year's budget, but especially when assembling the budget for 2013. According to CDU deputy floor leader Michael Meister, new borrowing will remain at €26.1 billion this year, even though the first installments of at least €8.6 billion for the new euro bailout fund, the European Stability Mechanism (ESM), will come due in the summer. Meister intends to achieve this goal primarily through "smart budget management." In other words, each of the 5,500 items in the budget will be closely examined and will be granted only as much as absolutely necessary.

In addition, tax revenues last autumn were significantly higher than forecast. And Germany has also saved billions on sovereign bond interest rates, with returns at record lows due to the ongoing euro crisis.

The challenges will be greater next year. In 2013, the finance minister hopes to reduce new borrowing to €15 billion. But because the planned financial transaction tax cannot be implemented throughout Europe, and a number of additional expenses will be incurred,Schäuble will have to find some €10 billion in order to hit his target.

That is the primary motivation for assembling a new austerity package. Finance Ministry officials already have a clear idea of what it should look like. In particular, they have set their sights on the social benefits coffers, which, thanks to a strong economy, are currently well funded. Federal healthcare subsidies are to be reduced by up to €2 billion and the government's contribution to the pension insurance system is to be trimmed by a similar amount. Both cuts are to be lasting.

Schäuble also intends to cut the budget of the Federal Employment Agency by several hundred million euros and to cap outlays for the parental leave allowance program, expenditures for which have risen substantially in recent years.

As explained in Employment = Poverty and Inequality, the German populace is not in a great position to absorb these cuts to social spending that amount to almost a 40% reduction in new borrowing by next year, and 100% in the next two. Many of them are performing part-time, low-wage work that has greatly exacerbated wealth inequality within the population. As the German export industry is squeezed from the revenue side of the equation due to extremely low demand in Europe and the world, it will be forced to lay off workers and cut wages further, placing even more people into relative poverty.

POPULATION BELOW POVERTY LINE (%)

Assuming that everything is contained within the Euro crisis, and Greece either stays in without further German money or exits peacefully (fat chance!), these "exemplary" and ambitious austerity plans will simply place more downward pressure on German aggregate domestic demand, economic growth and tax revenues, making its deficit situation worse over time. That is especially true if Merkel sticks with the Euro experiment and is forced to pony up ever-growing sums of bailout money and Germany's sovereign borrowing costs correspondingly rise. So Merkel may be leading Germany and Europe by example, but she's leading them straight into the depths of economic depression and sociopolitical chaos.

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Related:
For ordinary Greeks, the effects of austerity are becoming intolerable

Jim Willie: Herding Greek Cats from Bondage

From Goldseek, 22 February 2012
By: Jim Willie CB, GoldenJackass.com

Listen to the empty words of the last bailout for Greece. Credibility with the Jackass was lost back on the third bailout, well over a year ago, out of the six bailouts in total. Perhaps it is seven comprehensive final bailouts. The pattern is clear. The politicians, without popular support, forge agreements on debt coverage with the Greek officials. The deals fall through, hit the ground, and expose the lack of support even from the European bankers, led by the Germans. The pattern has been vividly clear for over a year, enough for my dismissal of new accords right away on the basis that the German bankers will not conform and agree to the deals struck. The political leaders in France (Sarkozy) and Germany (Merkel) are due to lose their offices, yet they continue to march around at useless summits attempting to cut last ditch agreements that mean nothing. The people are not willing in Germany to hand over any more than the $3 trillion to date, from the start of the common Euro currency experiment. The bankers, like at the Bundesbank, should attend the summits, but that would be too obvious on where the majority of power is held. What is unfolding is a comprehensive Greek Govt debt default from the inability to contain the situation, the impracticality of the austerity budgets put in place, the wreckage that has come to the Greek Economy, and the intractable solution.

My view is the entire charade for two years has been a grand delay to enable the big banks to sell out of their bonds and dump them on the Euro Central Bank. Almost every bailout has been of bank assets in some sort of redemption, not budget assistance. The biggest question posed and not answered is: HOW ANGRY ARE THE OWNERS OF THE FEDERAL RESERVE AND EURO CENTRAL BANK TO ACCUMULATE AND OWN SUCH A MOUNTAIN OF TOXIC PAPER?? My German banker source says the Germans will make what seem like agreements or permit the politicians to make them, but the bankers will consistently obstruct them. He steadily stresses how Germany has wasted $300 billion in savings each year, is exhausted, and no longer is willing or able to provide national welfare for Southern Europe. They will write no more checks except what will successfully grab collateral prize properties. It has become obvious the Greeks will not hand over much of any property without lighting the city on fire. It is the end of the bailout road. A few months ago my firm position, stated in the newsletter, that the bailouts would end when the riots amplify. They have amplified. Conclusion: GAME OVER.

Next comes a planned or unplanned default. Let's see how inequitable they will make it. Obviously it will be inequitable, since all accords have greatly favored the bankers. The TARP Fund was the most egregious, but it only disguised the bigger multi-$trillion grants with zero cost to the many banks, both central bank and private bank. The upshot of the Financial Regulatory Bill is that the USFed must open its books, but only after such loans take place, not to be reversed. Back to Greece. For a few months, some clarity and realism has entered the discussions and analysis concerning the burning nation of antiquity. The new theme has been that Greece will default, must default, and cannot avoid a default. Exactly. So the challenge is to avoid the horrendous collateral damage that will come. The central bankers, regional commissars, and technocrats have been working overtime, but Davos was a missed opportunity for forging potential solutions or at least elements.

A great comment came out of the World Economic Forum in Davos. The comment came from one of the few Economics Nobel Winners who makes any sense at all. The recent parade of prize winners seems either clownish in support of the status quo in disaster mode, or abstruce to the point of irrelevance. Joseph Stiglitz uttered perhaps the only wisdom or story worth reporting from the forum, a country club gathering of bankers and their investment fund cohorts whose mission is to defend the failing system. Stiglitz said,"European leaders repeat the same kind of platitudes, [like] we need to get growth going, [like] austerity will not be enough, but no country has policies that will achieve growth. I have not heard a single thing here in Davos that has convinced me that the European leaders have any sense of what they need to do and will do. Nobody knows who owes what to whom, where the risks of a Greek default are." It reminds me of a premise that the first step in a reconstruction, remedy, and solution is to liquidate the big insolvent banks. But that is precisely where the power lies in controlling the USGovt. If not the banks, the agencies that have evolved into a private sprawling enterprise control much hidden power.

BLUEPRINT FOR DAMAGE CONTROL

One must be serious and grounded in reality. No solution exists for Greece without liquidation of their debt, its restructure with huge writedowns if not total wipeout loss, a return to the Drachma currency, recapitalization of their banks, and a hands off to carpetbaggers. Almost none of these measures will be done, except blockage of the foreigners intending to exploit. Talk is clear about a 70% bond haircut, which does not seem enough even though it is brutal. The biggest practical impediments to the Greek Economy are the austerity plan and the absent ability to devalue the currency. Every single austerity plan to date has been a failure, in every nation attempted. They result in worse economic slowdowns, greater job loss, broad cancelation of projects, reduced pension security, and much wider deficits. Yet they continue in a grand procession of ruin. One must wonder if ruin is the goal, so that another technocrat can be put in power, unelected and with allegiance only to the syndicate. Who selected Papademous and Monti?

The absent path to a currency devaluation hits as the central flaw of the common Euro region. The weakest cannot compete against the strongest. In time the strong nations refuse to provide the higher standard of living at their own domestic expense. The German standard of living has fallen badly, angering many of its citizens. The normal evolutionary path calls for a troubled nation to do debt restructure, to enact broad reforms, to devalue the currency, and to stimulate the economy. The path taken for two years has been to dance around the debt table. No action at all on devaluation, since removal from the Euro currency umbilical would mean enormous debt writeoffs for the major European banks. This is the same obstructive dynamic at work in the United States. Greece needs to go back to the Drachma, devalue it by 30% or more, and enjoy some stimulus. Their list of export items is not in great volume. The austerity budgets are the exact opposite of stimulus. Lunacy has taken root, like with an entire class of public contract workers must work for no pay. The power center of the big banks prevents solutions. So the next phase will be full of risk and intrigue, if not treachery.

LAYERS OF RISK

Big Bank losses: The big banks in Europe face staggering losses. The attempts to make a mere 35% bond loss haircut in past deals was so unworkable as to be laughable. They fooled nobody. Reality has entered the room, as a 70% writedown figure has been proposed on current bailout deals. The big banks are already reeling from credit portfolios damaged by property like home mortgage and commercial mortgage. They are hurt by sovereign debt generally, not just from Greece. The Italian and Spanish Govt debt losses will be higher in volume, lower in percentage loss. The big bank exposure extends also to private debt within the Greek Economy, like with mortgages and commercial loans. They are all at heavy risk. The Basel II rules have forced de-leveraging as a warmup process that weakened many banks. The big European banks should enter failure from an imposed Greek Govt debt default and restructure. The Greek losses will strain the system to the hilt.

Contagion to Banks outside Europe: The interwoven nature of Western banking does not add to its strength, like in integrated plywood sinews, but rather exposes its weakness. The London banks own a huge amount of Southern Europe sovereign debt. The New York banks own a sizeable portion also. A recent conversation with a sturdy German banker revealed that Citigroup owns an enormous amount of debt in Greece, Italy, and Eastern Europe in the mortgage sector. Most will be written off with big losses. The amount of PIGS sovereign debt owned by banks in France is enormous, well detailed, but under-reported. The cross pollenation will come to the fore as the ripples are felt. The German banks own too much sovereign debt. The big banks outside Europe are at great risk, just like those throughout the Continent. Many non-European banks should enter failure from an imposed Greek Govt debt default and restructure. The Greek losses will strain the system to the hilt.

Euro Central Bank: Like the US Federal Reserve, these two central banks have served as the buyer of last resort for toxic bonds that both nobody wants and have nearly worthless value. Their owner lords (think castles in London and Switzerland) must be pushing back hard. The new EuroCB head Mario Draghi at first stated a firm position of not wishing to buy Southern European sovereign bonds, since badly impaired. When the Italian and Spanish Govt Bond yields rose toward or past the 7% magic mark, he relented. The stability returned in the bond market, but at the high cost of further wrecking the EuroCB balance sheet. It is hard to know which is more ruined, loaded with toxic paper, the EuroCB or the USFed. Both in my view are wrecked entities and control towers. Neither can serve adequately as a central bank when acting like a proxy for the entire banking system. They must remove the bank reserves held as hostage from private banks. The major central banks should face severe insolvency from an imposed Greek Govt debt default and restructure. The Greek losses will strain the system to the hilt.

Credit Default Swaps: The bond insurance market is even more corrupt than the mortgage market. At least the  mortgage arena contained some hint of regulatory oversight. The derivative market has none at all. Some fine analysts like Chris Whalen stated two and three years ago that without the derivative trade, the US banks would have keeled over dead long ago. They took in huge fees on contracts whose legitimacy and effectiveness are unclear. The ISDA has issued rulings on bond debt default that seem corrupt to the core. The next round of Greece Govt Bond writedowns apparently will feature CDSwap insurance responses in the form of awards in exchange for bond ownership, the inherent asset swap. Like the SEC and CFTC, the ISDA is loaded with bankers from the everpresent Wall Street revolving door. They will serve the banks at the expense of the system and economy. The interwoven nature of Western banking does not add to its strength, but rather exposes its weakness. The claimed offset on derivative ownership is nonsense, as Bank A holds derivatives that cover Bank B, and vice versa. They do not cancel out for net neutral. Both banks are killed, neither able to aid the other. The payouts for Credit Default Swap contracts being enforced should cause tremendous additional damage to the entire financial system, from an imposed Greek Govt debt default and restructure. The Greek losses will strain the system to the hilt.

Exposure of Profound Fraud again: The strain from any imposed default skein will expose the derivative market. The cast of counter-parties is too diverse. The obligations are too unclear. The nature of the contracts is too untested. The enforcement by the ISDA rulings are too subservient. Like with the mortgage sector, liquidations reveal the seriously putrid underbelly. With mortgages, no widespread liquidation of mortgage bonds could be done, since the process would reveal bond fraud to the extreme. Its mortgage contract fraud is in the open for full view. So patchwork was done, even nationalization of Fannie Mae and AIG under the USGovt wing. The fraud is contained supposedly, but without the basis of a solution. Hyper monetary inflation goes down a Black Hole. So also is the nature of the derivative market. Liquidations will reveal the seriously corrupted core of the business. After the recent MFGlobal, JPMorgan, and COMEX episode, one more log on the raging fraud bonfire. The system's foundation of integrity is burning. The CDSwap contract award process should expose profound fraud in the system from an imposed Greek Govt debt default and restructure. The Greek losses will strain the system to the hilt.

Recapitalize domestic banking systems: The banking system has operated in the Western nations amidst deep insolvency for three years or more. When the Greek default is begun, that insolvency will be much worse. Some banks will fail. The dominos will fall. The impact will be understood quickly. The need to rebuild the banking system will be an obvious and very painful realization, but the volume will result in shock. The big banks serve as the core for the domestic credit engines, the machinery to pump credit into the many businesses. That engine is sputtering badly. Some measures will be done to enable new Euro Bonds to take senior position, but expect it to backfire since bond dealers and bond funds will resist the favored treatment and retreat. Several $trillion will be needed to recapitalize the banking systems, not just a few banks. With the dependence upon newly printed unbacked money, the banking systems should lose further integrity from an imposed Greek Govt debt default and restructure. The Greek losses will strain the system to the hilt.

Debt Rating Agencies: Since the autumn months of 2008, the agencies have acted more responsibly. The Standard & Poors downgrade of the USGovt debt was a wakeup call of unprecedented manner. However, the Moodys and Fitch agencies did not follow suit. Worse, the S&P chief executive was forced out of office, probably by a Wall Street phone call, replaced by a Citigroup veteran. In the last several months to perhaps 18 months, the debt rating agencies have been doing their job reponsibly, but their focus is entirely on Europe. They have ignored the United States, even ignored the embattled insolvent US States. They are piling on with European sovereign downgrades, European bank downgrades, even European stability fund downgrades. Instead of putting the debt rating agencies at greater risk from an imposed Greek Govt debt default and restructure, the pressure will be on them as a group to focus more attention on the USGovt and the US States. Their collective financial condition is equally bad as Greece.

Economies suffer from Austerity: The impact of every austerity plan is to put in place what appears to be a more rigid spending process. But the dependence of the domestic economies is so great upon the public sector for jobs and projects and grants and subsidies, that the damage is instant and deep. No austerity budget plan has resulted in improved finances in the first two years of emplacement. None! The economists seem blind to the effect. The politicians seem ignorant. The corporate leaders are frustrated. No solution exists for remedy short of a five year period. Many economies in the West should suffer even worse and more painful recessions from an imposed Greek Govt debt default and restructure. The Greek losses will strain the system to the hilt.

Amplified Inflation Risk: All solutions proposed involve the disposition of new money, either from outright printing without backing or from grander fiscal deficits. The austerity plans result in worse deficits, thus worse pressure on inflation. Any banking system recapitalization would be the crown jewel of monetary inflation. Imagine the effect of $1 trillion or $2 trillion in recapped banks, only to find they require another $1 trillion several months later. The inflation impact could be enough to push the water level over the bunker banker walls. Those walls have prevented the staggering hyper monetary inflation from spilling over into Main Streets across the nation. The bank sector has enjoyed 98% of the bailout benefits. The public has been told to tighten belts and to eat cake. Look for the bank recapitalization project, if it occurs, to finally push the inflation process in such a way that price inflation hits the USEconomy in force. Refer to rising wages and rising prices, not just costs. Tremendous pressure should come on systemic price inflation from an imposed Greek Govt debt default and restructure. The Greek losses will strain the system to the hilt.

Interest Rate Swap Risk: If price inflation rises in unexpected fashion, the pressure put on the USTreasury Bond market will be greater than any time in the last ten years. So far, the abuse of the Interest Rate Swap contract has provided outsized leverage in keeping down the USTBond yields generally, by creating artificial bond demand. The financial press is totally oblivious to this phenomenon. Investors do not flock to USTBond as safe haven. The Wall Street leverage machinery has created bond demand from the basement working overtime for over two years. The smoking gun was the 1Q2011 report on derivative growth by the Office of the Comptroller & Currency. It revealed $8 trillion in notional derivatives put on by Morgan Stanley alone. So much for investor bond demand and contradiction of the S&P downgrade of USGovt debt. What a clever tactic. However, the Greek Govt debt unraveling could place tremendous strain on the IRSwap device, even to expose it during a time of increased foreign creditor isolation. The US sovereign bond market inner circle hidden devices should be brought into the open from an imposed Greek Govt debt default and restructure. The Greek losses will strain the system to the hilt.

Unintended Consequence Risk: The last risk to cite is the risk of the unknown, the unexpected, that which cannot be properly planned. The potential unintended outcomes and pressures emanating from a comprehensive planned Greek Govt debt default defy description. In my view, it is like herding 100 cats freed from bondage on a truck in an open field. The Jackass loves cats, but never have they been captured in a yard when attempted. They jump fences, crawl under fences, disappear in holes under houses, even hide in car engines. They are fast and elusive, changing directions with extreme quickness and agility. So will be the consequences to a planned Greek demolition of their indebted edifices. The Powerz must realize the challenge that lies ahead, and look upon each with some trepidation.

GOLD & SILVER

The battle has been waged in the 1750 to 1800 price corridor for almost a full month. It is critically important. A smaller battle to overcome the 1650 mark was a success, thus making the Gold price recovery firm and recognized. As a solution is worked out in Greece, or the absence of one with another in a series of grand missteps, watch the Gold price cast a vote. The system's integrity lies in the balance. The pressure points are across the entire financial and economic systems. The solutions are elusive since the basic initial step of big bank liquidation is refused, too much damage to be doled to the banks that control the power. The zinger is the recapitalization of the banking system, an urgent need and requirement, the understood impact from the imposed Greek comprehensive solution. Expect more favored treatment to the banks. However, as they are put back on solvent feet, a process only possible with vast hyper monetary inflation directed specifically at the banking pillars, the retribution from within the system will possibly be the first serious price inflation leakover. For over three years, the monetary inflation leakover has been contained, to the detriment of the economy.

The anticipation of that systemic price inflation event could be seen in the Gold price. The direct response to the imposed Greek debt solution could be some sort of capitulation, a recognition that the Western financial and monetary system cannot be fixed. Any perception that bank system reconstruction would assure another powerful bout of price inflation as the heavy cost could be a major unintended consequence.The Gold price could explode past $2000 per ounce if that were to occur. If the planned demolition of the Greek Govt bond building does not go according to plan, look to the Gold price for a powerful upward response. The list of unintended consequences and collateral damage is very long indeed. The risk is staggering acute and not easily measured. Gold should serve as the effective pressure valve. Most every attempt to push down the Gold price in the last few weeks with yet more naked shorting has been thwarted and opposed by the Eastern Coalition, their new project.

 

THE HAT TRICK LETTER PROFITS IN THE CURRENT CRISIS.

home:  Golden Jackass website              

subscribe:  Hat Trick Letter

Jim Willie CB, editor of the “HAT TRICK LETTER”

Globalists Push Internet Control Freak Treaty at the United Nations

By Kurt Nimmo
Infowars.com - February 22, 2012

Popular outrage over SOPA and PIPA has forced the globalists to seek a new line of attack in their effort to control the internet. On February 27, they will engage in a “diplomatic process” that will hand over to the United Nations unprecedented control over a free and open internet.

The defeat of SOPA and PIPA marked the first battle in a war to control the internet.

Numerous countries are pushing for United Nations governance over the internet by the end of the year, including Russia and China. Russian PM Vladimir Putin said last year his goal is to impose “international control over the Internet” through the International Telecommunication Union (ITU), a treaty-based organization under the auspices of the UN.

The ITU is working to globalize the radio spectrum, latest-generation wireless technologies, aeronautical and maritime navigation, radio astronomy, satellite-based meteorology along with the internet. It is positioning itself to control next-generation networks, the technology that will replace the current free and open internet.

Authoritarian China and Russia want to renegotiate the 1988 treaty that deregulated and decentralized the internet and paved the way for its fantastic success and popularity. The 1988 treaty, the Wall Street Journal notes, “insulated the Internet from economic and technical regulation and quickly became the greatest deregulatory success story of all time.”

The ITU treaty negotiated at the behest of the United Nations will radically modify the internet and bring it under control of the global elite. In addition to imposing cyber security mandates, it will outlaw peer-to-peer technologies and impose unprecedented economic regulations such as mandates for rates, terms and conditions. It will allow transnational corporations to charge fees for “international” internet traffic possibly on a “per-click” basis for certain web destinations.

The ITU will also end the nonprofit status of multi-stakeholder internet governance entities such as the Internet Corporation for Assigned Names and Numbers – in other words, UN bureaucrats answering to the globalists will control who is allowed to establish a presence on the internet. They will also control the Internet Engineering Task Force, the Internet Society and other multi-stakeholder groups that develop and configure engineering and technical standards for the internet.

The Wall Street Journal notes that governments are “threatened by popular outcries for political freedom that are empowered by unfettered Internet connectivity. They have formed impressive coalitions, and their efforts have progressed significantly.”

In addition to political activism, the internet allows for the free dissemination of information and alternative news that effectively counters the dinosaur establishment media. In order to realize their one-world authoritarian agenda, the global elite will need to make sure websites like Infowars.com do not have a presence on a next-generation internet now under development.

Following overwhelming opposition to SOPA and PIPA, the globalists will now push the ITU. They understand that it will much more difficult for people to oppose and defeat an international treaty beyond the reach of their national governments and politicians and this is how they will eventually implement their control freak agenda over the internet.

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 Related:

BBC: Let's Kill the Internet and Start Over

SOPA replacement uses child porn as excuse to spy on 99.7 percent of Americans

Top Social Media Websites Caught Censoring Controversial Content

Israeli Strike Imminent: “We’re At The Very Last Moment”

From The Daily Sheeple

The former chief of staff to Israeli Prime Minister Benjamin Netanyahu said Saturday an Israeli strike against Iran’s nuclear facilities is “imminent.”
Naftali Bennett appeared on Fox News’ “Huckabee” and painted a dire picture of a world with a nuclear Iran, saying Israel will not hesitate to take action if necessary — and that time is of the essence.
“We’re at the very last moment. This is going to be the first time in history that a maniacal, radical Islamic regime will acquire a nuclear weapon,” he said. “The day after they have a bomb will be a different day for the entire world.”
On Saturday, a report emerged saying Iran is headed for a major nuclear expansion, the same day as reports that Iranian warships had passed through the Suez Canal.
Calling Iran “an octopus of terror,” Bennett told host Mike Huckabee in no uncertain terms: “We have to stop them, and yes, it is imminent.”

Continue reading

Richard Daughty & Chris Waltzek on GoldSeek Radio February 21, 2012

Chris Waltzek of GoldSeek Radio talks to Richard Daughty.
Click Here to Listen to the Interview

Original audio (daughty02.21.12.mp3)

Greek Tragedy turns Comedy with Troika document leak, as Obama's Boeing PR Crashes in Wichita

From CapitalAccount 21 Feb 2012:

Greece has a bailout agreement, but does the country have a chance at growing it's way out of debt as the Troika and Greek politicians continue to claim? A look at a debt sustainability assessment document leaked to the Financial Times from inside these negotiations shows that even the best-case projections used to justify the bailout don't even meet the minimum threshold publicly demanded by the IMF. The baseline scenarios, which are so rosy that it's hard not to laugh when looking at the numbers, have Greece returning to positive economic growth within two years, and an end to the recession by next year. Who is making these projection, and what basis is there in reality for them? Lauren speaks to Capital Account producer Demetri Kofinas, who says that the numbers are a total farce, and that no one has any clue what the Greek economy will look like in a year, let alone over the next two decades, which is what this document attempts to asses.

And the US state department hosts the first global business conference. Looks like even Hilary Clinton is a job recruiter these days. At the same time Barack Obama is strolling around the country touting his big jobs initiatives, picking Boeing as the perfect example of what's right with US manufacturing and job creation. Well, not to rain on your parade Mr. Obama, but if Boeing is such a great example of manufacturing, why on earth is the "air capital of the world," Wichita Kansas, losing jobs from...you guest it, Boeing? Lucky for us, we have labour journalist extraordinaire Mike Elk in studio to give us the answers. He just got back from Wichita with a full report.

And one of the most recognizable works of art in western society, "The Scream" goes on sale and is expected to fetch 80 million dollars. An apocalyptic depiction of raw human anxiety and anguish amidst bloody sky -- this this a reflection of social mood? Well, on a day that the dow broke 13,000 it may be hard to tell.

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Related:

How Goldman Sachs Masked Greece’s Debt

Why Europe Hasn’t Solved the Greek Debt Crisis

Nigel Farage - Catastrophe Imminent & Gold to Break $2,500

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Intel Exclusive: Trillion Dollar Terror Exposed

From VeteransToday, February 21st, 2012 | by Gordon Duff

LORD JAMES OF BLACKHEATH, EXPOSING "TRILLION DOLLAR TERROR"

Bush, Fed, Europe Banks in $15 Trillion Fraud, All Documented

By Gordon Duff, Senior Editor

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Below is one of the strangest stories in financial history, one involving the US government lying about hundreds of thousands of tons of imaginary gold, illegal wire transfers and loans totalling $15 trillion.  The video, from the House of Lords, is amazing in itself. 

What it doesn’t express is where the money came from though Lord James of Blackheath proves conclusively that an effort was made to say it came from a gold reserve in Brunei that, in fact, never existed.

At surface, it appears we have stumbled upon the largest terrorist organization in the world and have found original documents tracing its funding to the Secretary of the Treasury and the Chairman of the Federal Reserve, two of the top financial officers in the US.  A cursory review of terrorism statues in the US indicate that all transactions we will learn about are, in fact, to be assumed “terrorist money laundering” and that the only thing preventing the immediate arrest of hundreds of top financial officials is their political connections alone.

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We will be able to offer an alternative, more insights, some hard intelligence and some very valuable background that we hope will offer insightful and realistic perspectives on this amazing story.

On February 16, 2012, Lord James of Blackheath, member of Britain’s House of Lords presented evidence of an illegal scheme begun, he has thus discovered, in 2009.  His documents including originals signed by Alan Greenspan and Timothy Geithner, show the illegal “off the books” transfer by the Federal Reserve Bank of New York of $15 trillion to, initially, HSBC (Hong Kong Shanghai Banking Corporation) London and then to the Bank of Scotland.

The Bank of Scotland, under royal charter but restricted from involvement in any such transactions, simply “gave” the money to 20 European banks to use in a highly profitable scheme of co-trading “fresh cut” MTN’s (mid-term notes), generating trillions of dollars in profits over 3 years, none of which is shown on books, none has been taxed or has benefitted shareholders in those banks.

As Blackheath outlines, the “deception and cover” for this transfer is the imaginary seizure of 750,000 tons of gold by agents of an unspoken entity (confirmed by the highest official sources as the Bush family and CIA), the listed “source” of the money.

The government of Indonesia confirms this to be an utter fabrication and that the individual named had 700 tons of gold (about half of what Gaddafi was holding), not 750,000.  It is noted that only 1,500 tons of gold have ever been traded in world history, as stated in the House of Lords.

The issues that are initially brought out, issues inconsistent with international convention and starting the reader on what is only the surface discovery of two decades of crimes involving dozens of governments are as follows:

• At no time has the Federal Reserve Bank of New York been authorized to hold the funds indicated
• However, documents held by Lord Blackheath prove, conclusively that they did hold such funds and transfer them in a manner as to obscure their origin by using HSBC and the Bank of Scotland.  This process, seemingly involving Alan Greenspan, Timothy Geithner and others would appear to be “money laundering” until some other explanation were found.  None has been offered.
• The “collateralization” of these funds, being 750,000 tons of gold, is proven to be fantasy.  These funds then, in no way or manner, are related to Brunei.  The presentation of this false transaction has been conclusively proven to be a “cover and deception” project such as an intelligence organization would use.
• The transfer of these funds, all done without any authorizations, governmental or otherwise, particularly without agreements, payment of interest to the United States and without knowledge and approval of congress makes every aspect of this criminal in nature, a violation of innumerable statues.
• The receipt and use of these funds by the 20 banks, two of which are Wall Street’s largest, and the use of these funds to generate profits while the funds themselves are held “off the books” and the profits hidden and laundered, themselves the earnings of funds received through criminal acts makes any and all involved part of a criminal enterprise.

WHERE DID THE MONEY COME FROM

There is no record of the Federal Reserve being authorized to “create” $15 trillion, equal to the entire national debt of the United States.  There is, however, proof that funds that totalled, at one time, $27 trillion had been earned surreptitiously, disposed of as part of an intelligence operation against the Soviet Union and then later stolen with accusations made against George H. W. Bush as being the perpetrator.

I have spoken with two individuals, one President Reagan’s intelligence coordinator and the other Chief Legal Cousel for the Central Intelligence Agency regarding these funds.  Both have indicated that former President Bush had asked that these funds, totalling $27 trillion, be transferred to his control, that threats were made by Bush and that many involved in this operation suffered, issues including murder, illegal arrest, torture and detention among them.

The individuals I am speaking of repreatedly met with President  Bush over these funds, disputed his claim to them, and indicate that the majority of the funds are the property of the people of the United States.

These funds are the mysterious “Wanta” funds, monies earned through years of currency trading aimed at collapsing the Soviet Union, a plan originated by President Ronald Reagan, then White House Intelligence Coordinator Lee Wanta and CIA Director William Casey.  I have been told that, while this operation went forward under President Reagan, he had ordered that his successor, George H. W. Bush not be “briefed” out of “mistrust” for Bush.

The funds themselves were earned through a scheme of trading Soviet roubles at enormous profit, a practice that eventually collapsed their government.  A portion of the profits are subject to current litigation in the Federal Court of the Eastern District of Virginia, Judge Lee presiding.  I have over 2,000 pages of documents on this case which shows a remainder of the original funds had been transferred to the Federal Reserve Bank of Richmond by the Bank of China, a party to the rouble trading practice, in 2006 and is claimed as totally owned by Ameritrust Corporation.  That amount was $4.5 trillion of which we hold the SWIFT transfer documents.

The other monies, which “likely” make up from the unspent portion of the missing $27 trillion, may well constitute all that is recoverable.

Wanta, sole shareholder in Ameritrust, has offered his companies share, valued by the court now at $7.2 trillion, entirely to the American people as intended by President Reagan. 

The origin of the additional funds, issued by the Federal Reserve during the 80s and 90s, totalling nearly $8 trillion is unknown.   High ranking sources within the US government indicate that this can only be either the remainder of funds Wanta raised or profits made from them after the majority of funds were stolen.

Stories, some quite good actually, and personal interviews plus my own review of documents would place the theft or conversion of these funds initially with:

• The Bush family
• The “P2,” a Masonic lodge operating out of Switzerland involved in dozens of terror bombings tied to “Operation Gladio”
• People around Wanta himself including the CIA

What is lacking is a source for half of these funds.  Technically, they don’t exist as there is no record of them being originated by nor transferred to the Federal Reserve Bank of New York though there are clear and discernible records of them being transferred out of that institution which never possessed them, according to their 2010 audit, in the first place.

WANTA MONEY

The transfer of Wanta funds, they can be assumed to have no other origin as they track into the Federal Reserve banking system while in escrow and are currently awaiting payment based on the orders of President Obama in accordance with findings of the federal court, is complicated by the Scottish transfer.

Either Wanta has claim to the entire amount or it is the property of the US government.  That no effort has been made to secure the funds or enforce criminal and civil remedies to recover enough money to pay the entire US national debt and more, as with earnings, we are nearing well over $30 trillion by this time, is an indication that a criminal conspiracy with enough influence to overrule our own government is involved.  Whether that “conspiracy is, as noted, the Bush family, rouge sections of the CIA or a secret society such as P2, one we can prove or others we only suspect exist, is another story.

The lack of action, here or as requested by Lord James in Britain, is, in itself, proof of both the seriousness and actuality of these events and the powers that can prevent any inquiry when irrefutable documents such as SWIFT transfers are available.  In fact, Lord James has offered a wealth of documents which, when combined with the 2000 pages of Wanta “discovery” from the Federal Court, constitutes more than prima facia evidence of money laundering, conversion, terrorism or worse.

Thus, the inaction in the face of overwheming and unquestioned proof is inexplicable.

FLOOD OF WANTA LITIGATION AND INDICTMENTS COMING

Currently, Wanta’s legal status is as technical conservator and owner of $7.2 trillion.  However, as nearly half that is owed in taxes and the court settlement required Wanta to purchase $1 trillion in treasury bonds, the federal government should show positive interest other than President Obama and a few others.  More are being obstructionist with the payout and exercise of $3 trillion in US debt reduction.

This is, not only illegal but an indication of conspiracy.

In addition, Russian Prime Minister Putin has communicated that he awaits the agreed upon 3% payment of Russian taxes, initially on the $7.2 trillion.  Will Putin want to be paid on the entire $15 trillion plus interest and will Russia and/or the US have interest in why the Bank of Scotland transferred these funds to 20 European banks to trade in MTN’s (mid term notes) without any authorization or agreement, any participation or sharing of profits.

As the funds, at least the half which the US government can claim ownership of, combined with the interest and earnings of, would quickly put the US “in the black,” again we look at, not just the press blackout on the Wanta litigation of the last 6 years but the press blackout on Lord James of Blackheath and the wealth of damning documentation he submitted to Parliament.

Nothing has been done since, it is as though the proof submitted was so dangerous that those moments in time have been erased by a mysterious g-dlike power.

What makes Wanta dangerous is that he has begun to distribute funds, some to government entities, counties and states, law enforcement agencies, giving them standing, not just in recovering funds intended for their use but in helping prosecute anyone involved in interfering with or attempting to divert funds.

One grand jury is being formed to investigate diversion of Wanta funds even at this early date.  It is likely that Wanta/Ameritrust funds earmarked for border protection could lead to the indictment of high ranking US officials.  This is only the beginning.

If the Royal Bank of Scotland doesn’t think it should be expecting the biggest chargeback in the history of the world, they are in for a shock.