Archive for February, 2012

Hyperinflation – a German Case Study

Wednesday, February 29th, 2012 at 7:55 pm  
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The following book gives a great account of the devastating effects of hyperinflation. It shows the social consequences of the German hyperinflation upon the populace. Very grim indeed. It gives the rest of the world a glimpse into their future as the current central planners travel down this same path. At one point, before republication, it was selling on Amazon for over $800 a copy. You can download the book for FREE here:

When Money Dies – The Nightmare of the Weimar Collapse – by Adam Fergusson

http://tinyurl.com/76h969c

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John Williams’ Hyperinflation Update 2012

Tuesday, February 28th, 2012 at 7:06 pm  
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John Williams of Shadowstats.com has just made public his 2012 Hyperinflation Special Report and it reveals the importance of making preparations. He specifically mentions that the economy will likely be reduced to a barter economy for a short period. Members should login to our site and download our Barter Tycoon report and begin sharpening their skills. If you are not a member yet you can subscribe by clicking here:

http://tinyurl.com/7vqa4sz

You can find out more about our Barter Tycoon Report here:

http://tinyurl.com/79jdswm

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Here is an excerpt from John’s latest hyperinflation report:

Hyperinflation Nears

As previously noted, before the systemic-solvency crisis began to unfold in 2007, the U.S. government already had condemned the U.S. dollar to a hyperinflationary grave by taking on debt and obligations that never could be covered through raising taxes and/or by severely slashing government spending that had become politically untouchable.  Also, the U.S. economy already had entered a severe structural downturn, which helped to trigger the systemic-solvency crisis.

Bankrupt sovereign states most commonly use the currency printing press as a solution to not having enough money to cover obligations.  The alternative here would be for the U.S. eventually to renege on its existing debt and obligations, a solution for modern sovereign states rarely seen outside of governments overthrown in revolution, and a solution with no happier ending than simply printing the needed money.  With the creation of massive amounts of new fiat dollars (not backed by gold or silver) comes the eventual full destruction of the value of the U.S. dollar and related dollar-denominated paper assets.

The U.S. government and the Federal Reserve have committed the system to its ultimate insolvency, through the easy politics of a bottomless pocketbook, the servicing of big-moneyed special interests, gross mismanagement, and a deliberate and ongoing effort to debase the U.S. currency.  Yet, the particularly egregious fiscal and monetary responses to economic and solvency crises of the last five years have exacerbated the government’s solvency issues, bringing the great financial tempest close enough to making landfall that the hairs on the backs of investors necks should be standing on end.

Numerous foreign governments/central banks have offered unusually blunt criticism of U.S. fiscal and Federal Reserve policies as the crisis has expanded, but the perceived self-interests of the U.S. government and Fed always will come first in setting domestic policy.  Where both private and official demand for U.S. Treasuries had been increasingly unenthusiastic, the Fed—the U.S. central bank—effectively has been fully funded Treasury needs for most of 2011, with its “quantitative easing,” becoming a euphemism for Fed monetization of U.S. Treasury debt.

Further easing by the Fed is likely in the months ahead, as the ongoing economic turmoil triggers significant further fiscal deterioration.  Those actions should pummel heavily the U.S. dollar’s exchange rate against other major currencies.  Looming with uncertain timing is a panicked dollar dumping and dumping of dollar-denominated paper assets, which remains the most likely event as proximal trigger for the onset of hyperinflation in the near-term.

The early stages of the hyperinflation would be marked simply by an accelerating upturn in consumer prices, a pattern that already was initially in response to QE2.  Also, money supply velocity (see Inflation and Money Growth) will spike, as the U.S. dollar, again, comes under heavy and even disorderly selling pressure, with both domestic and foreign holders getting rid of their dollar holdings as quickly as possible.  One factor that can contribute to rising velocity is the current circumstance where U.S. investors cannot get a safe return that beats inflation, as reported by the government.  Investors can do better by buying a store of products that are rising price, rather than by holding cash or a Treasury bill.

Given the current lack of political will by those controlling the U.S. Government to address the fiscal solvency issues, the U.S. has no way of avoiding a financial Armageddon.  Various government intervention tactics might slow the process for brief periods, and the system always is vulnerable to external shocks, such as wars and natural disasters.  Government actions could include supportive dollar intervention, restrictions on international capital flows, wage and price controls, etc.  Effects of any such moves in delaying the onset of full hyperinflation, though, would be limited and short-lived.  There is no obvious course of action or external force at this point of the process that meaningfully would put off the nearing day of reckoning.

What lies ahead will be extremely difficult, painful and unhappy times for many in the United States.  The functioning and adaptation of the U.S. economy and financial markets to a hyperinflation likely will be particularly disruptive.  Trouble could range from turmoil in the food distribution chain and electronic cash and credit systems unable to handle rapidly changing circumstances, to political instability.  The situation quickly would devolve from a deepening depression, to an intensifying hyperinflationary great depression.

While resulting U.S. economic difficulties would have broad global impact, the initial hyperinflation should be largely a U.S. problem, albeit with major implications for the global currency system.

For those living in the United States, long-range strategies should look to assure safety and survival, which from a financial standpoint means preserving wealth and assets. Also directly impacted, of course, are those holding or dependent upon U.S. dollars or dollar-denominated assets, and those living in “dollarized” countries.

Physical gold (sovereign coins priced near bullion prices) remains the primary hedge in terms of preserving the purchasing power of current dollars.  In like manner, silver is in this category.  Also, holding stronger major currencies such as the Swiss franc, Canadian dollar and the Australian dollar, likely are good hedges (see Financial Hedges and Investments).

In terms of survival on a day-to-day basis, U.S.-based individuals should be building a store of goods in preparation for a manmade disaster, much as they would for a natural disaster such as an earthquake.  Economic activity probably would devolve to a barter system, but such could take months to become fully functional (see Barter System).

How to get out of jury duty but why you may not want to

Tuesday, February 28th, 2012 at 6:32 am  
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Every day Americans are thrown in jail over victimless crimes such as driving without a license, drug possession, or for violations of any of the other gazillion stupid laws that are on the books.

Jefferson Mack, from his book Invisible Resistance to Tyranny – How to Lead a Secret Life of Insurgency in an Increasingly Unfree World, writes:

What most people don’t know is that every American called to jury duty still has the power to nullify an unjust law as it applies to the case in which he sits in judgment. All it takes is a single vote and the defendant will be found not guilty.

Unfortunately, most Americans sitting on juries today don’t know they can vote their conscience, even if the judge specifically orders them not to do so. They don’t know because judges, politicians, and supporters of supreme government go to great lengths to make sure they never learn that they have this right. It is not taught in public schools. Judges never tell juries they can do it, and they forbid defendants and their lawyers from telling the jury what they can do. Worst of all, judges try to exclude citizens who know they have that power. This means that anyone who honestly answers a question on the subject while being considered for jury duty is promptly dismissed.

This happened to me. I wasn’t trying to get out of jury duty but they quickly dismissed me when I explained that I have the power to ignore jury instructions and return a “not guilty” verdict if I felt the law was an unjust one.

Jefferson Mack continues…

It is not surprising that some invisible resisters are lying to the judge when asked the question about their willingness to follow the judge’s instructions. Such resisters have learned how to cheat the judge and prosecutor when sitting on a jury trying a case where the law is patently unjust or unconstitutional.

In jury deliberations, such an invisible resister never makes any mention of jury nullification or challenges the constitutionality of the law in any way. Instead he insists that he is convinced that either the evidence was fabricated or doesn’t prove the case, or that a key witness was lying. At the least, he will hang the jury. He may even convince his fellow jurors that the case was not proved and win an acquittal.

Most of us will never be called to serve on a jury. Many of those who are called will sit for cases in which the defendant is charge with a violent crime that deserves punishment if the evidence proves he is guilty. But if an invisible resister finds himself sitting on a jury deciding a case in which the defendant is charge with a violent crime that deserves punishment if the evidence proves him guilty. But if an invisible resister finds himself sitting on a jury deciding a case in which the defendant is accused of tax evasion, illegal drug activity, laws controlling firearms, or a violation of an of the many other unjust laws that government supremacists use to limit our freedom, he or she will have an opportunity to strike for freedom by voting not guilty.

This is not easy to do. Other jurors who are lovers of supreme government may be determined to lock the defendant up for the rest of his life. It takes strength of character to stand alone in such a situation, but men and women of strong will and a commitment to freedom can do it. Whatever happens, the committed invisible resister will stand his ground. You don’t even have to argue your case. All you have to do is have the guts to cast the one vote that hangs the jury.

Illegal Everything

Monday, February 27th, 2012 at 8:39 pm  
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Another reason to move assets out of your own name and into
Invisible New Mexico LLC’s:

Utah Lawmakers Urge Congress to Repeal ‘Indefinite Detention’ Law

Monday, February 27th, 2012 at 6:59 pm  
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From PrisonPlanet.com:

Paul Joseph Watson
Prison Planet.com
Monday, February 27, 2012

Utah has become the latest state to revolt against the indefinite detention provision of the National Defense Authorization Act (NDAA), introducing a resolution urging Congress to repeal the law that allows Americans to be incarcerated without trial.

Utah Lawmakers Urge Congress to Repeal Indefinite Detention Law

Following in the footsteps of Virginia, which earlier this month passed a House bill that codifies noncompliance with the “kidnapping provisions” of section 1021 and 1022 of the NDAA, the resolution “expresses disapproval” of the same provisions, noting that they serve to “violate a right guaranteed by the United States Constitution and the Utah Constitution.”

“Be it further resolved that the Legislature of the State of Utah, the Governor concurring therein, urges the United States Congress to repeal or clarify Sections 1021 and 1022 of the 2012 NDAA to protect the rights guaranteed by the United States Constitution and Utah Constitution,” states the resolution (PDF).

The NDAA bill, which was signed into law by President Obama under the radar on New Years Eve while he was on vacation in Kailua, hands the government power to “allow the military to indefinitely detain terror suspects, including American citizens arrested in the United States, without charge.”

Republican Senator Todd Weiler, the chief sponsor of the resolution, fears the indefinite detention provisions of the bill could be used against American citizens just as the Patriot Act has been used against non-terrorists, telling the Salt Lake Tribune, “I have a legitimate fear this National Defense Authorization law will do the same thing.”

Emphasizing how opposition to the indefinite detention provisions of the NDAA crosses partisan lines, both the American Civil Liberties Union and the conservative Utah Eagle Forum expressed their support for the resolution.

  • A d v e r t i s e m e n t

“Our concern is in the definition of ‘terrorist,’ ” the Eagle’s Forum’s Dalane England told the Salt Lake Tribune. “Our current administration has already called people pushing back against the current administration terrorists.”

Indeed, under the Obama administration, the FBI, the Department of Homeland Security, and the National Counterterrorism Center have jointly identified those described as “homegrown violent extremists” by characterizing criticism of government as an indication of terrorism.

In all 62 of the cases reviewed by those agencies recently, such “homegrown terrorists” were found to have “increasingly spoke out against the government” and “blamed the government for perceived problems”.

Despite Obama’s signing statement claiming he would not use the bill to detain American citizens without trial, it was the administration itself which demanded the ‘kidnapping’ provisions apply to US citizens and not merely foreign terrorists.

The anti-NDAA resolution, which is currently making its way through the Utah House, could be the precursor for a binding legislation along similar lines to the bill passed in Virginia.

According to the Tenth Amendment Center, which has been tracking the nationwide revolt against the NDAA, a total of nine states have now introduced resolutions or bills in opposition to the indefinite detention of American citizens.

 

Two Cases’ Lessons: If Cops Don’t Know What You Encrypted, They Can’t Make You Decrypt It

Friday, February 24th, 2012 at 10:45 am  
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From Forbes:

The last 24 hours have produced two opposite rulings about whether suspects in legal cases have to cough up the password to potentially incriminating data that they’ve encrypted on a hard drive. The two cases add up to a lesson: If the cops don’t know what they don’t know, your secrets are safe. But if they know what they’re looking for, the world’s strongest cipher isn’t going to stop them from getting it from a suspect.

On Thursday, the 11th circuit court of appeals ruled in the child pornography case of an unnamed man called John Doe that he wasn’t legally required to give up the password to an encrypted hard drive that might contain incriminating information. (The PDF of the ruling is here.) Forcing him to decrypt his data, the judge in the case argued, would violate Doe’s fifth amendment rights to not offer any testimony that would incriminate himself. But the very same day, a federal appeals court rejected the appeal of a suspect for mortgage fraud named Ramona Fricosu, demanding that she give up the password to her encrypted laptop despite her plea that the computer–just like John Doe’s–contained incriminating data.

Those two cases may seem on the surface like mere judicial confusion and contradiction. But the real difference between them, says Electronic Frontier Foundation attorney Hanni Fakhoury, is what investigators expected to find on those scrambled hard drives. Fakhoury cautions that the details of every case are different, but that broadly speaking, “if the government knows what they’re going to find, they have no problem,” he says. “If they don’t, they can’t make you decrypt anything.”

In the case of John Doe, the suspect came to law enforcement’s attention when the IP address of his computer and his name in a hotel’s registry were tied to pornographic pictures of underage girls posted to YouTube. But when authorities seized his hard drives, parts of them were encrypted with the program TrueCrypt. Investigators were unable to decrypt them and–just as importantly–couldn’t begin to guess what might be stored in those encrypted partitions.

That ambiguity allowed Doe to plead the fifth, according to the court’s ruling. The court’s opinion makes clear that if investigators had known what they were looking for, Doe would have had to decrypt that file. That situation would be a situation the ruling calls a  ”foregone conclusion,” when the court knows that a piece of evidence is potentially incriminating, but the holder of that evidence won’t make it available. Without that knowledge, however, the password to Doe’s files is merely like any kind of testimony, and falls under Doe’s fifth amendment protections.

“We find no support in the record for the conclusion that the Government, at the time it sought to compel production, knew to any degree of particularity what, if anything, was hidden behind the encrypted wall.” it reads. “The Fifth Amendment protects Doe’s refusal to decrypt and produce the contents of the media devices because the act of decryption and production would be testimonial, and because the Government cannot show that the ‘foregone conclusion’ doctrine applies.”

In the Fricosu case, on the other hand, the authorities had a recording of the suspect talking to her co-defendant in which she mentions an incriminating file on her laptop. That’s enough, Fakhoury says, for the court to compel her to turn over the password. Given that she had already incriminated herself in the recorded conversation, refusing to decrypt the hard drive just becomes a case of withholding evidence for which she can be held in contempt.

Fakhoury compares the situation to a 2008 case in Vermont where a child pornography suspect, Sebastien Boucher, had a file on his computer clearly labelled as graphic child pornography–I’ll spare you the exact, disgusting phrase. In that case, the fact that the file was encrypted didn’t help him–the mere title of the file was enough to bypass his fifth amendment argument against handing over the password.

Fricosu’s case isn’t nearly as black and white. But the nature of the encrypted contents is clear enough that the court has ruled the fifth amendment doesn’t help her.

So what’s the lesson for those that value their hard drive’s privacy, even against legal intrusion? Fakhoury makes clear that the EFF isn’t trying to help child pornographers avoid prosecution. But he offers two pieces of advice for others who hope to avoid handing over their passwords to the cops. “Encrypt everything,” he says. “And don’t label your files ‘child porn.’”

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Documentary Video: Argentina’s Economic Collapse…coming to USA?

Tuesday, February 21st, 2012 at 7:48 pm  
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UK Surveillance State

Sunday, February 19th, 2012 at 9:21 am  
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From The Telegraph:

Phone and email records to be stored in new spy plan

Details of every phone call and text message, email traffic and websites visited online are to be stored in a series of vast databases under new Government anti-terror plans.
Phone and email records to be stored in new spy plan

The databases would not record the contents of calls, texts or emails but the numbers or email addresses of who they are sent and received by Photo: ALAMY

By , Home Affairs Correspondent

9:00PM GMT 18 Feb 2012

Landline and mobile phone companies and broadband providers will be ordered to store the data for a year and make it available to the security services under the scheme.

The databases would not record the contents of calls, texts or emails but the numbers or email addresses of who they are sent and received by.

For the first time, the security services will have widespread access to information about who has been communicating with each other on social networking sites such as Facebook.

Direct messages between subscribers to websites such as Twitter would also be stored, as well as communications between players in online video games.

The Home Office is understood to have begun negotiations with internet companies in the last two months over the plan, which could be officially announced as early as May.

It is certain to cause controversy over civil liberties – but also raise concerns over the security of the records.

Access to such information would be highly prized by hackers and could be exploited to send spam email and texts. Details of which websites people visit could also be exploited for commercial gain.

The plan has been drawn up on the advice of MI5, the home security service, MI6, which operates abroad, and GCHQ, the Government’s “listening post” responsible for monitoring communications.

Rather than the Government holding the information centrally, companies including BT, Sky, Virgin Media, Vodafone and O2 would have to keep the records themselves.

Under the scheme the security services would be granted “real time” access to phone and internet records of people they want to put under surveillance, as well as the ability to reconstruct their movements through the information stored in the databases.

The system would track “who, when and where” of each message, allowing extremely close surveillance.

Mobile phone records of calls and texts show within yards where a call was made or a message was sent, while emails and internet browsing histories can be matched to a computer’s “IP address”, which can be used to locate where it was sent.

The scheme is a revised version of a plan drawn up by the Labour government which would have created a central database of all the information.

The idea of a central database was later dropped in favour of a scheme requiring communications providers to store the details at the taxpayers’ expense.

But the whole idea was cancelled amid severe criticisms of the number of public bodies which could access the data, which as well as the security services, included local councils and quangos, totalling 653 public sector organisations.

Labour shelved the project – known as the Intercept Modernisation Programme – in November 2009 after a consultation showed it had little public support.

Only one third of respondents backed the plan and half said they feared the scheme lacked safeguards and technical rigour to protect highly sensitive information.

At the same time the Conservatives criticised Labour’s “reckless” record on privacy.

A called Reversing the Rise of the Surveillance State by Dominic Grieve, then shadow home secretary and now Attorney General, published in 2009, said a Tory government would collect fewer personal details which would be held by “specific authorities on a need-to-know basis only”.

But the security services have now won a battle to have the scheme revived because of their concern over the ability of terrorists to avoid conventional surveillance through modern technology.

They can make use of phone tapping but their ability to monitor email traffic and text messages is limited.

They are known to have lobbied Theresa May, the Home Secretary, strongly for the scheme. Their move comes ahead of the London Olympics, which they fear will be a major target for terror attacks, and amid a climate of concern about terrorists’ use of the internet.

It has been highlighted by a number of attacks carried out after radicalisation took place through websites, including the stabbing by a young Muslim woman of an MP at his constituency surgery.

Sources said ministers are planning to allocate legislative time to the new spy programme, called the Communications Capabilities Development Programme (CCDP), in the Queen’s Speech in May.

But last night privacy campaigners warned the scheme was too open to abuse and could be used for “fishing trips” by spies.

Jim Killock, executive director of the Open Rights Group, a civil liberties campaign organisation, said: “This would be a systematic effort to spy on all of our digital communications.

“The Conservatives and Liberal Democrats started their government with a big pledge to roll back the surveillance state.

“No state in history has been able to gather the level of information proposed – it’s a way of collecting everything about who we talk to just in case something turns up.”

There were also concerns about the ability of phone and internet companies to keep the information secure.

And the huge databases could also be used by internet service providers, particularly to work out which advertising to target at users.

Broadband firms including BT came up with a scheme almost three years ago to target advertising, but it did not get off the ground.

However, if companies were able to exploit the information they will be compelled to keep for the CCDP, they would be much more capable of delivering advertising to computers and even mobile phones based on users’ past behaviour.

Gus Hosein, of Privacy International, said: “This will be ripe for hacking. Every hacker, every malicious threat, every foreign government is going to want access to this.

“And if communications providers have a government mandate to start collecting this information they will be incredibly tempted to start monitoring this data themselves so they can compete with Google and Facebook.”

He added: “The internet companies will be told to store who you are friends with and interact with. While this may appear innocuous it requires the active interception of every single communication you make, and this has never been done in a democratic society.”

A Home Office spokesman said: “It is vital that police and security services are able to obtain communications data in certain circumstances to investigate serious crime and terrorism and to protect the public.

“We meet regularly with the communications industry to ensure that capability is maintained without interfering with the public’s right to privacy.

“As set out in the Strategic Defence and Security Review we will legislate as soon as Parliamentary time allows to ensure that the use of communications data is compatible with the Government’s approach to civil liberties.”

Andrew Kernahan of the Internet Service Providers’ Association said: “It is important that proposals to update Government’s capabilities to intercept and retain communications data in the new communications environment are proportionate, respect freedom of expression and the privacy of users, and are widely consulted upon in an open and transparent manner.”

Jon Matonis and “Brain-banking”

Sunday, February 19th, 2012 at 9:09 am  
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Profound implications for individual privacy and freedom:

From quora:

Jon Matonis, e-Money specialist

Brain Banking (or true mobile banking) – I’m not exactly sure where this one is leading us, but BrainWallet, the concept of individually storing bitcoin in one’s own mind by memorization of a passphrase https://en.bitcoin.it/wiki/Brain… was not possible with traditional centralized currencies. Presumably, if the corresponding public key is used as your primary receiving address, then you are walking around daily with access to everything that has been assigned to you on the block chain.

Now, combine that usage scenario with the $10 trillion plus annual shadow economy and you have just facilitated a parallel economy that doesn’t require financial institutions and doesn’t even require physical currencies.  You automatically receive new deposits into your brain; however, you have to locate a cafe computer or Android smartphone to spend them.

Without a “government” how would you deal with violent criminals?

Saturday, February 18th, 2012 at 11:23 am  
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Statist: “Without a state how would you deal with violent criminals?”

Voluntaryist: “Well I would start by not giving them a military.”

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