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Tuesday, September 30, 2014

The war is not meant to be won, it is meant to be continuous. Hierarchical society is only possible on the basis of poverty and ignorance. This new version is the past and no different past can ever have existed. In principle the war effort is always planned to keep society on the brink of starvation. The war is waged by the ruling group against its own subjects and its object is not the victory over either Eurasia or East Asia, but to keep the very structure of society intact. - George Orwell

Monday, September 29, 2014

Time Tested Art

  Name the six greatest artists of the 12th Century AD.  Take your time.  Here's a hint: one of them sculpted the masterpiece above: the KarlSchreinn.

Or does that make it too easy?

The 12th Century AD was extraordinarily eventful.  Surely, the great artists working at the great courts thought themselves to be tremendously important.  We know the Karlsschrein (Shrine of Charlemagne) in Aachen Cathedral was made at the command of Frederick II, Holy Roman Emperor.  Fred II has had many books written about him.  Yet, the name of the sculptor is now forgotten.  In fact, every single celebrated "genius" of that century is currently forgotten.  Yet some of  the artwork is priceless.  Because it is currently thought to be beautiful and historically important. 

In the world of post modern academia, both the idea of beauty and the idea of historical importance would be considered quaint relics of a semantically primitive age.  In the post modern world, Beauty and Historical Importance would be considered "relative."  While "Genius" is considered to be absolute.

In fact, what is "relative" is the importance of post-modern ideas.  Take a post modern artist like Any Warhol.  You would find an absolute    Post Modern concensus that the print of Marilyn Monroe is an artistic masterpiece, and that Warhol is a "genius," or at least an important artist.

But in 1000 years will anyone remember Warhol's name?  Will anyone looks at his images?  Nobody knows.  But one thing is sure.  If, in 1000 years, the ideas of Post Modernism are thought of as "quaint" and "semantically primitive," every single artist working in that idiom may be considered irrelevant, or, simply, "decorative."    And every artwork not intricately linked to some important historical event to lend it importance, may be worthless.
Which brings us around to Ancient Art. What's so great about the image above of the lion and the bull minted by Croesus of Lydia in 545 BCE?

Well, it's the first gold coin in the history of the world.  The first.  What could be more historically important?  And, if you're familiar with the symbolism of the image, it tells a fascinating story about religion myth, and conquest in the 7th Century BCE.

Have you ever heard of Julius Caesar?  What might be the importance of a contemporary portrait rendered by an artist of obvious talent?

Will there ever be a time in human history when this artwork is considered irrelevant?  Highly unlikely.  Because the importance of this artwork is not linked in an way to topical academic fashion.  It does not need to to be dignified by essays filled with technical vocabulary.  That is it beautiful is obvious even to those who would argue tirelessly that such a thing doesn't  really exist.

And it will be important as long as Julius Caesar and the Roman Empire are thought to be historically important.  How about Alexander the Great?  Have you heard of him?  If not you could read any one of hundreds of biographies.  Many were written in the 4th century BCE.  And hundreds have been written since.  He's really a fascinating figure.  He conquered most of the known world, in his day.  The contemporary portrait above is extraordinarily beautiful.  And the story behind its minting is fascinating.

Is the artist who engraved it a "Genius?"

Gee wilikers, could there possibly be a less interesting question in the history of art and ideas?

Saturday, September 27, 2014


There is no doubt that the NGC Ancients grading program has become the standard of the US Ancient coin market.  Americans want graded coins.  Europeans not so much, at this point.  Yet the enormous increase in the ancient coin buying population is clearly coming from US buyers who are moving from US and World coins into Ancients, where relative rarity, beauty, and historical importance clearly still yields tremendous value compared to the US and World markets, in spite of the recent run up in prices.

But, for those not used to Ancients, where no two coins are exactly alike even from the same issue - even from the same dies - understanding grades and assigning value is still often a daunting task.

The beginner often looks first to the Overall Grade.  Mint State grades almost always command a premium over lesser grades.  But even rank beginners can tell the difference between a Mint State Caesar portrait of awful style and a terrible strike and a beautifully engraved and well struck Caesar portrait:

 Choice VF CAESAR PORTRAIT: $17,500
Ancients:Roman Republic, Ancients: Julius Caesar, as Dictator (49-44 BC). AR denarius (19mm,3.90 gm, 3h). ... Image #3Ancients:Roman Republic, Ancients: Julius Caesar, as Dictator (49-44 BC). AR denarius (19mm,3.90 gm, 3h). ... Image #1

Ancients:Roman Republic, Ancients: Julius Caesar, as Dictator (49-44 BC). AR denarius (19mm,3.90 gm, 3h).  ...Ancients:Roman Republic, Ancients: Julius Caesar, as Dictator (49-44 BC). AR denarius (19mm,3.90 gm, 3h).  ...

CAN YOU TELL WHY?  (I'm sure you can)

It's encouraging that US collectors are making distinctions on elements other than the grade.  However, There are a few hard and fast rules that will keep new collectors from making horrible mistakes:

1) THE SURFACE GRADE IS NOT IRRELEVANT.  A 1/5 on the surface indicates a coin that has been altered to the point it is NO LONGER FUNCTIONALLY AUTHENTIC.  Be careful, even with coins that have been expertly altered so that they look great.  This is functionally the same as a forgery.  It will never have much resale value.  Think of the Mona Lisa.  If an expert restores small portions of the background that have been cracked or dirtied with age - well, that's probably fine, it's still the Mona LisaBut if a vandal spray paints the canvas black, and an expert comes in and repaints the Mona Lisa - well, really, it's not the Mona Lisa anymore- even if it looks great.

A 2/5 will indicate a coin with some problems - perhaps a bit of smoothing in the field.  Depending on the issue, while a problem, it is not necessarily devastating.  It will affect the value but, depending on the issue, the coin can retain real value.  Especially if most coins from the issue exhibit the exact same problem.  However, if there is extensive surface damage or problems, the value can certainly suffer.

A 3/5 can be absolutely fine.  Usually the problems are scrapes and digs.  If these are faint and in the fields they may not detract much from the price at all.  A small scratch RIGHT ON THE FACE even if the coins is 4/5 can be a real problem for many collectors, for obvious reasons.  On the other hand, an unobtrusive  banker's mark in the field might just make the coin more interesting while dropping the grade to 3/5.  USE YOUR DISCRETION.

2) The Strike is also vitally important.  A 5/5 is obviously great.  4/5 usually indicates some centering issues, if these are minor and all the relevant images and legends are still on the flan, this can be okay.  Especially if most coins from an issue display the same problems.  But if important design elements are off the flan: the value will certainly be compromised.  Know your issues.

3/5 on the strike is very very tough on resale value.

Fine Style: Vitally important for most ancients.  Yet, this is very subjective.  NGC is as good as anyone at identifying Fine Style.  Yet any two experts can still disagree.  Sometimes a coin just strikes someone as beautiful and someone else will disagree.  Sometimes, though not technically Fine Style, a coin can display a "BOLD" or "Interesting" style - especially with archaic coins - that is just as valuable.  Develop your own taste. You should be able to tell what you feel is a fine style.  Then you will never be disappointed with a purchase.

FINALLY AN ELEMENT NOT DEALT WITH IN THE GRADING PROCESS THAT CAN GREATLY AFFECT THE VALUE: DIE STATE and METAL QUALITY: a coin struck from fresh dies can greatly enhance the eye appeal, and thus the value.  The same goes for a coin struck on beautiful metal.  A coin struck from Rusty and/or  Worn dies can greatly adversely affect a coin value.  Look at the Caesar coin above.  The metal quality is atrocious.  The die state and metal quality is not accounted for in the grading process.  Take this into account.

Friday, September 26, 2014


Probably most people would agree that the people paid by the U.S. government to regulate Wall Street have had their difficulties. Most people would probably also agree on two reasons those difficulties seem only to be growing: an ever-more complex financial system that regulators must have explained to them by the financiers who create it, and the ever-more common practice among regulators of leaving their government jobs for much higher paying jobs at the very banks they were once meant to regulate. Wall Street's regulators are people who are paid by Wall Street to accept Wall Street's explanations of itself, and who have little ability to defend themselves from those explanations.

Our financial regulatory system is obviously dysfunctional. But because the subject is so tedious, and the details so complicated, the public doesn't pay it much attention.
That may very well change today, for today -- Friday, Sept. 26 --- the radio program "This American Life" will air a jaw-dropping story about Wall Street regulation, and the public will have no trouble at all understanding it.

The reporter, Jake Bernstein, has obtained 47½ hours of tape recordings, made secretly by a Federal Reserve employee, of conversations within the Fed, and between the Fed and Goldman Sachs. The Ray Rice video for the financial sector has arrived.

First, a bit of background -- which you might get equally well from today's broadcast. After the 2008 financial crisis, the New York Fed, now the chief U.S. bank regulator, commissioned a study of itself. This study, which the Fed also intended to keep to itself, set out to understand why the Fed hadn't spotted the insane and destructive behavior inside the big banks, and stopped it before it got out of control. The "discussion draft" of the Fed's internal study, led by a Columbia Business School professor and former banker named David Beim, was sent to the Fed on Aug. 18, 2009.

It's an extraordinary document. There is not space here to do it justice, but the gist is this: The Fed failed to regulate the banks because it did not encourage its employees to ask questions, to speak their minds or to point out problems.

Just the opposite: The Fed encourages its employees to keep their heads down, to obey their managers and to appease the banks. That is, bank regulators failed to do their jobs properly not because they lacked the tools but because they were discouraged from using them.

The report quotes Fed employees saying things like, "until I know what my boss thinks I don't want to tell you," and "no one feels individually accountable for financial crisis mistakes because management is through consensus." Beim was himself surprised that what he thought was going to be an investigation of financial failure was actually a story of cultural failure.

Any Fed manager who read the Beim report, and who wanted to fix his institution, or merely cover his ass, would instantly have set out to hire strong-willed, independent-minded people who were willing to speak their minds, and set them loose on our financial sector. The Fed does not appear to have done this, at least not intentionally. But in late 2011, as those managers staffed up to take on the greater bank regulatory role given to them by the Dodd-Frank legislation, they hired a bunch of new people and one of them was a strong-willed, independent-minded woman named Carmen Segarra.

I've never met Segarra, but she comes across on the broadcast as a likable combination of good-humored and principled. "This American Life" also interviewed people who had worked with her, before she arrived at the Fed, who describe her as smart and occasionally blunt, but never unprofessional. She is obviously bright and inquisitive: speaks four languages, holds degrees from Harvard, Cornell and Columbia. She is also obviously knowledgeable: Before going to work at the Fed, she worked directly, and successfully, for the legal and compliance departments of big banks. She went to work for the Fed after the financial crisis, she says, only because she thought she had the ability to help the Fed to fix the system.

In early 2012, Segarra was assigned to regulate Goldman Sachs, and so was installed inside Goldman. (The people who regulate banks for the Fed are physically stationed inside the banks.)
The job right from the start seems to have been different from what she had imagined: In meetings, Fed employees would defer to the Goldman people; if one of the Goldman people said something revealing or even alarming, the other Fed employees in the meeting would either ignore or downplay it. For instance, in one meeting a Goldman employee expressed the view that "once clients are wealthy enough certain consumer laws don't apply to them." After that meeting, Segarra turned to a fellow Fed regulator and said how surprised she was by that statement -- to which the regulator replied, "You didn't hear that."

This sort of thing occurred often enough -- Fed regulators denying what had been said in meetings, Fed managers asking her to alter minutes of meetings after the fact -- that Segarra decided she needed to record what actually had been said. So she went to the Spy Store and bought a tiny tape recorder, then began to record her meetings at Goldman Sachs, until she was fired.

(How Segarra got herself fired by the Fed is interesting. In 2012, Goldman was rebuked by a Delaware judge for its behavior during a corporate acquisition. Goldman had advised one energy company, El Paso Corp., as it sold itself to another energy company, Kinder Morgan, in which Goldman actually owned a $4 billion stake, and a Goldman banker had a big personal investment. The incident forced the Fed to ask Goldman to see its conflict of interest policy. It turned out that Goldman had no conflict of interest policy -- but when Segarra insisted on saying as much in her report, her bosses tried to get her to change her report. Under pressure, she finally agreed to change the language in her report, but she couldn't resist telling her boss that she wouldn't be changing her mind. Shortly after that encounter, she was fired.)

I don't want to spoil the revelations of "This American Life": It's far better to hear the actual sounds on the radio, as so much of the meaning of the piece is in the tones of the voices -- and, especially, in the breathtaking wussiness of the people at the Fed charged with regulating Goldman Sachs. But once you have listened to it -- as when you were faced with the newly unignorable truth of what actually happened to that NFL running back's fiancee in that elevator -- consider the following:

1. You sort of knew that the regulators were more or less controlled by the banks. Now you know.

2. The only reason you know is that one woman, Carmen Segarra, has been brave enough to fight the system. She has paid a great price to inform us all of the obvious. She has lost her job, undermined her career, and will no doubt also endure a lifetime of lawsuits and slander.

So what are you going to do about it? At this moment the Fed is probably telling itself that, like the financial crisis, this, too, will blow over. It shouldn't.

Wednesday, September 24, 2014

Mix prolonged recession with high unemployment and people look for time tested scapegoats:

Europe’s Anti-Semitism Comes Out of the Shadows


RECALLING HATE Jewish residents of Mechelen, Belgium, gathered this month to remember the Holocaust. Credit Sergey Ponomarev for The New York Times

SARCELLES, France — From the immigrant enclaves of the Parisian suburbs to the drizzly bureaucratic city of Brussels to the industrial heartland of Germany, Europe’s old demon returned this summer. “Death to the Jews!” shouted protesters at pro-Palestinian rallies in Belgium and France. “Gas the Jews!” yelled marchers at a similar protest in Germany.
The ugly threats were surpassed by uglier violence. Four people were fatally shot in May at the Jewish Museum in Brussels. A Jewish-owned pharmacy in this Paris suburb was destroyed in July by youths protesting Israel’s military campaign in Gaza. A synagogue in Wuppertal, Germany, was attacked with firebombs. A Swedish Jew was beaten with iron pipes. The list goes on.

The scattered attacks have raised alarm about how Europe is changing and whether it remains a safe place for Jews. An increasing number of Jews, if still relatively modest in total, are now migrating to Israel. Others describe “no go” zones in Muslim districts of many European cities where Jews dare not travel.


GERMAN WORRY The synagogue in Wuppertal, Germany, where a firebomb landed this summer but failed to ignite. For Jews in Germany, “this has very, very deep meaning,” said one synagogue member. Credit Sergey Ponomarev for The New York Times

But there is also concern about what some see as an insidious “softer” anti-Jewish bias, which they fear is creeping into the European mainstream and undermining the postwar consensus to root out anti-Semitism. Now the question is whether a subtle societal shift is occurring that has made anti-Jewish remarks or behavior more acceptable.

“The fear is that now things are blatantly being said openly, and no one is batting an eyelid,” said Jessica Frommer, 36, a secular Jew who works for a nonprofit organization in Brussels. “Modern Europe is based on stopping what happened in the Second World War. And now 70 years later, people standing near the European Parliament are shouting, ‘Death to Jews!’ ”

This is not the Europe of 1938. French leaders have strongly condemned the violence. Chancellor Angela Merkel of Germany this month led a rally against anti-Semitism in Berlin at which she told Germans, “It is our national and civic duty to fight anti-Semitism.”
Europe has seen protests and outbursts of anti-Semitism whenever the Israeli-Palestinian conflict has erupted, and some analysts say this summer’s anger is a cyclical episode that like others will fade away. Some note that the number of reported anti-Semitic incidents this year in France, for instance, is well below some years in the 2000s.

Yet as European support for the Palestinian cause and criticism of Israel have hardened, many Jews describe a blurring of distinctions between being anti-Israel and being anti-Jew.
With Europe still shaking from a populist backlash against fiscal austerity, some Jews speak of feeling politically isolated, without an ideological home. Many left-wing political parties are anti-Israel. Many right-wing parties, some with anti-Semitic origins, are extremist and virulently anti-immigrant. And many Jews who have voted with the Socialist Party in France and Belgium worry that those parties are weak and becoming more dependent on fast-growing Muslim voting blocs.

Even among those inclined to condemn racism in any form, fighting anti-Semitism is no longer seen as a priority, with Jews often perceived as privileged compared with Muslims and other minorities confronted with discrimination.

Many younger Muslims often seem alienated in Europe. Struggling to find work and frustrated by their lack of acceptance, a small but vocal group of them has become inflamed by the politics of the Middle East, especially the Israeli-Palestinian conflict.

European officials are deeply concerned that radical Islam, nurtured in the Middle East, could take root in Europe. Mehdi Nemmouche, a French Muslim arrested in connection with the killings at the Jewish Museum in Brussels, fought as a jihadist in Syria. A French journalist who was held captive in Syria until April said Mr. Nemmouche had been one of his torturers.

“We are a microcosm of the Middle East,” said Philip Carmel, European policy director for the European Jewish Congress. “The Middle East is being imported into Europe.”
Visits to some of the flash points of the summer violence revealed a picture of what Prime Minister Manuel Valls of France has called a “new anti-Semitism.” In Sarcelles, the Paris suburb where pro-Palestinian protests spiraled into riots, the alienation of France’s immigrants and minorities lies just below the surface. In Brussels, the headquarters of the European Union, some secular Jews described a changing atmosphere and questioned whether it was time to leave.
And in Wuppertal, Germany, a city proud of its commitment to religious and ethnic diversity, the attempted firebombing of a synagogue exposed underlying tensions that became even clearer this month when, unexpectedly, a group of Muslim men patrolled a neighborhood wearing makeshift uniforms that said “Shariah Police.”

The French Melting Pot
On the afternoon of July 20, a siege mentality gripped Little Jerusalem, the Jewish commercial district in Sarcelles. A crowd of young Jewish men had gathered at the synagogue as a pro-Palestinian protest was held a few blocks away. France’s Interior Ministry had tried to ban the protest, which spun into a riot. Cars were burning. Young men were throwing rocks as the police fired tear gas. A Jewish-owned pharmacy was set on fire.
“We were all concentrated here to defend the synagogue,” said Levi Cohen Solal, 21, who joined the human cordon outside the synagogue. “Everybody was scared.”
Blocked by the police, the rioters never reached the synagogue, but Sarcelles became a televised symbol of France’s new anti-Semitism — a depiction many local residents did not recognize. A working-class suburb where generations of immigrants are packed into government housing, Sarcelles is a melting pot of religions and ethnicities, where many people speak of a largely peaceful coexistence.

To many residents, the demonstration, which was organized by outsiders on social media, was an indictment not of Sarcelles, but of France. Youth unemployment is soaring, especially in immigrant havens like Sarcelles, and many French-born children and grandchildren of immigrants have become alienated from French society.

“They have a real hatred against the state,” said Bassi Konaté, a city social worker, who added that many of the protesters came from poorer districts nearby. “A big proportion of these people feel neglected. A lot of these people don’t know anything about Gaza. But they want to confront the police.”

An early sign that these broader resentments were morphing into more open expressions of anti-Semitism came with the emergence several years ago of Dieudonné M’bala M’bala, a French comedian who lashed out at Jews and played down the Holocaust. He has since allied himself with Jean-Marie Le Pen, the 86-year-old founder of the far-right National Front, who this summer used an apparently anti-Semitic pun, which alluded to Nazi crematories, as a riposte to a Jewish critic. Many of the comedian’s shows have since been banned in France, but his popularity has continued to rise, unnerving many Jews.

“For the past four or five years, we have felt a growing insecurity,” said David Harroch, who runs a Jewish bookstore in Little Jerusalem. “My customers tell me how worried they are about the climate here, the situation. A lot of people have left.”

Israeli officials predict that as many as 6,000 Jews will migrate from France this year, a stark reversal from the 1950s, when Sephardic Jews, Arabs and others began arriving in Sarcelles from North Africa. A booming economy made work plentiful.
But during France’s recession in the late 1970s, the city’s ethnic groups became pitted against one another for limited public resources. Rahsaan Maxwell, a political scientist who has studied Sarcelles’s ethnic groups, said the Sephardic Jews had incurred resentment because they were better organized and able to mobilize politically to win certain perks from the elected local council: a special Jewish section in the local cemetery, widening of a road in front of the main synagogue, kosher offerings at an annual city dinner for the elderly, and segregated swimming hours for men and women at a city pool.

In his 2012 book, “Ethnic Minority Migrants in Britain and France,” Mr. Maxwell wrote that Sephardic Jews became so influential that “when Israel was at war with Lebanon in the early 1980s, Sephardic Jewish activists in Sarcelles were aggressive about using it as a litmus test for local politicians to see whether they supported Israel and the Jewish people.”

Yet many Jews and Muslims born in that era grew up together without rancor in government housing. Not far from one of the city’s storefront mosques is a small Superette grocery owned by a Muslim family. One of the owners, Abdel Badaz, recently stood behind the counter with a childhood friend, Mickaël Berdah, 36, a Jew whose family emigrated decades ago from Tunisia. They both criticized the riot as the work of young troublemakers.

“When you’ve grown up in the neighborhood, and you know everybody, there isn’t that kind of hate,” Mr. Berdah said. “When there is that kind of hate, it is at the roots, something about the way parents have educated their children.”

Later, near the grocery, a tall teenager pedaled his bicycle toward two journalists and shouted at them to leave, saying the media had lied about Sarcelles. The youth, Diakité Ismael, 19, the French-born son of Senegalese immigrants, soon calmed down and, like others, argued that there was no animosity in Sarcelles between local Muslims and Jews.

“Look,” he said, as a bearded Jewish man in a dark suit and skullcap walked by, “there’s one.”
But when asked about Gaza, Mr. Ismael became agitated, rambling and warning that the world was hurtling toward a catastrophe. He said he had seen video of an Israeli bomb hitting a funeral in Gaza. “Somehow, some Jews control politics, information, business and finance,” he said. “I’m not talking about the Jews here. I’m talking about Jews in general.”

And a lot of morons believe that right here in the United States
(see the editorials at


FRANCE, JULY 20 A pro-Palestinian protest in Sarcelles, which officials tried to ban, descended into rioting. Outsiders organized the demonstration. Credit Thibault Camus/Associated Press

“Jews, in general,” he added, “only let you see what they want you to see.”

In Brussels, Heightened Alert
Music rose from the center of Brussels on Sunday, with joggers and bicyclists moving freely down city streets as the seat of the European Union held its annual no-car day. It had the giddy air of a street fair, if less so for the city’s Jewish organizations, which the police had placed under heightened security since two recent incidents.

The first happened the previous Sunday, Sept. 14, which marked the European Day of Jewish Culture. As people gathered to dedicate a plaque at a Holocaust memorial, youths hurled stones and bottles until the police arrived. Three days later, a fire erupted on an upper floor of a synagogue in the city’s Anderlecht district; the authorities are investigating the incident as arson.

It was the May shooting at the Jewish Museum in Brussels — and the subsequent arrest of Mr. Nemmouche — that attracted international attention, as four people were killed, including two Israelis. But there have been smaller incidents that received less notice: a Turkish shop owner in Liège who posted a sign saying he would serve dogs but not Jews, a voice on the intercom of a commuter train that announced a stop as "Auschwitz" and ordered all Jews to get off.

“This summer, I started to see the world in a different way,” said Marco Mosseri, 31, a native Italian who works in the automotive industry in Brussels. “I was scared. I spent several nights without sleep. For the first time, I was thinking that maybe I could die from my religion.”

With its chocolate shops, Trappist beers and gray gloom, Brussels is the center of Europe’s sprawling bureaucracy, a symbol of the loathed policies of austerity. But Brussels also embodies the demographics transforming much of urban Europe, with generations of Muslim immigrants and their descendants now representing roughly a quarter of the population.

The Jewish community is small, about 20,000 people, most of them assimilated, secular Jews like Mr. Mosseri, who usually do not draw attention to their heritage. (A recent report issued jointly by two European Jewish organizations found that 40 percent of European Jews hide their Jewishness.) Now some secular Jews say they have stopped wearing a necklace with the Star of David, or allowing their children to wear T-shirts for a Jewish summer camp on public buses or trains.
And since the start of the conflict in Gaza this summer, many describe social media, especially Facebook, as a swamp of hatred.

“I have friends who are never political and they are posting things about Gaza every day,” said Ms. Frommer, the employee of the nonprofit organization. “It seems like an obsession. Is your obsession because you want to save children, or because you have a problem with Jews?”

In a city so devoted to politics, the issue of Israel can seem unavoidable to some Jews, even those who strive to be apolitical or tend to be critical of Israeli policy. Ms. Frommer grew up in Brussels, but then left for college in Britain, followed by a long stint working in Cambodia. When she returned to Brussels four years ago, she was struck by how much more polarized life seemed. Her Jewish friends were sticking closer together as office chatter now sometimes bore a sharper edge.
This summer, one of her Belgian colleagues repeatedly mentioned the Israeli-Palestinian conflict. “He would often try to bring up the subject when I tried not to,” she said. “Then the subject would shift from Israel to Jews. Then it was, ‘Were there really six million Jews killed in the Second World War?’ ”

Nor was the comment isolated. There have been signs that anti-Jewish sentiment transcended the immediate backlash against the Gaza war. In Hungary, the rise of the far-right Jobbik party has brought concerns that anti-Semitic views are gaining mainstream traction.
In Italy, extreme right-wing activists were blamed for a flurry of anti-Jewish graffiti, including Nazi swastikas, on buildings in various cities. In Rome, f liers calling for a boycott of at least 40 Jewish-owned stores appeared last month with the signature of the far-right group Vita Est Militia. Italian investigators were also looking into whether such far-right parties were building alliances with extremist left-wing groups.


BELGIUM, MAY 25 Police officers helped arrange flowers in front of the Jewish Museum in Brussels the day after a shooting there killed four. Credit Olivier Hoslet/European Pressphoto Agency

In Brussels, several pro-Palestinian marches were held this summer, most of which were peaceful, but a few bore an anti-Semitic edge, including shouts of “Death to Jews!” While Belgian politicians quickly condemned the shooting at the Jewish Museum, some Jews felt the response to the protests, including that of the center-left Socialists, was tepid at best.

“The Socialist Party is afraid, because of the votes here in Belgium,” said Dr. Maurice Sosnowski, an anesthesiologist and prominent Jewish leader in Brussels. “In Belgium, they are not willing to speak loudly, because there are a lot of Muslims.”

In the nonprofit world of Brussels, the politics of Israel, which some on the European left view as essentially the pursuit of racist objectives against Palestinians, have made it difficult to keep the fight against anti-Semitism high on the agenda.

“Some see it in conflict with the anti-racism movement,” said Robin Sclafani, director of the Brussels-based group A Jewish Contribution to an Inclusive Europe. The organization, also known as CEJI, provides anti-discrimination training to teachers, social workers and others. Ms. Sclafani said she now receives numerous requests for training sessions to combat discrimination against Muslims, yet there is little interest in workshops on anti-Semitism.

Tuesday, September 23, 2014

THe Dollar Wins the Ugly Contest: For NOW

Right now there are only three world reserve currencies: the dollar, the euro and the yen.

The Euro and the Yen are dying.  Stagnation, aging populations, mass unemployment, overwhelming tax burdens: vast structural problems that are insoluble.

Money is now flowing out of Europe and Japan into the US.  And as it does the dollar will only rise and rise.  It's a one way bet.  And this will keep pressure on gold.  And put a floor under US assets.

And this will add ballast to the absurd claim that the dollar rise is proof of a recovering US economy.

Here's the huge and obvious problem.  There is no US growth either.  We simply have the deepest and safest markets in a deteriorating financial universe.  But the structural problems here: wage stagnation, mass underemployment, growing wealth inequality and tremendous unfunded liabilities,  - all dependent on perpetual negative real rates - will, in short order, be EXACERBATED by a STRONG DOLLAR.

The very false emblem of our "recovery" will crush our ability to export, and push a stagnant economy back into outright recession.

Then the game will be over.  There will be no more engine (no matter how feeble) for global growth.

Confidence will finally falter.  The dollar will have to be devalued.

And then Gold and Hard Assets with experience the final thrust into a hyperinflationary spiral in a world that is otherwise in a mass depression.

We're not that far away.  Don't be lulled.

Monday, September 22, 2014


Obama Defends Goldman Sachs & Derivatives Demand EU Include them in Free Trade and Cannot Regulate US Banks

Obama is defending Goldman Sachs & of NY Bankers in their bid to include Derivatives in the free trade agreement with Europe and to ensure they cannot be regulated by Europe. Obama insists, at the bank’s request, that  subject US banks to EU regulation will complicate the regulatory landscape unnecessarily. The banks are lobbying hard for that position from the White House. Obama wants derivatives IN EVERY MARKET globally to be exempt from foreign regulators just in time for the next bubble. 

Obama argues they are hedges against exchange rate fluctuations, but derivatives also bet on purchases of real estate and mortgages, commodities, food, their sales or purchases in the future. This includes the toxic bombs that wiped out so many banks - mortgage derivatives, including the so-called CDO’s (mortgage insurance). 

The EU is now putting pressure on the US by threatening to exclude any discussions on financial services altogether from the trade agreement unless Washington agrees to Brussels’ demands to put regulation on the table. The EU is arguing that the existing transatlantic dialogue between watchdog regulators and other international venues is not entirely adequate for regulatory matters. Indeed, the US has far too many regulators compared to just one in Europe including London. The mortgaged backed securities required approval by SEC, CFTC, Fed, Banking regulators, etc. at least 7 approvals of US regulators but they all follow each other anyhow, Huge waste of resources. The EU is correct on this debate.

Derivatives created by the NY banks are an important part of the target with the US free trade agreement. The EU has for a second time granted an extension of the deadline due to efforts to oversee the global derivatives market. The U.S. regulators have completely failed to achieve any breakthrough in the main points of contention. This was reported by Business Insider . Nonetheless, this move could have big consequences for the financial industry on both sides of the Atlantic. It was Robert Rubin who sought to gain the exclusion of regulation for banks under the WTO to export derivatives. However, the derivative nightmare is still fresh in Europe where it created the most damage. These negotiations could see banks and insurers left out of what would be the biggest regional trade agreement in the world, covering almost half of global output.

The two sides were the standstill at odds over the design of clearing houses to secure such trade. Creating independent clearing houses to help in the future to avoid risks while operating together in the respective legal systems is essential. Creating such a system is not enticing because these toxic-bombs can be so toxic nobody fully can determine the risk.There are obviously deep concerns about impending losses, whereas a further delay would mean a setback for the intended regulation of the face value 710 trillion US-dollar market.

Nevertheless, it has been the complexity of the derivatives market is considered as the core problem of the financial crisis 2007-2008. The controversy between Obama and the EU is his relentless protection of the NY banks. As the European banking crisis gets far worse, the previous optimism was Obama expecting trust in America but that is fading in finance rather rapidly. The greatest problem is neither the heads of the banks nor anyone in Washington fully understand what happens in a such a market during a meltdown do to the deep complexity of the structures.

Obama has subject the entire world to US regulation prosecuting foreign banks that do not obey US sanctions, but at the same time he is trying to prevent and European regulation of US banks. They are lobbying Obama to exclude them from any European regulations. Furthermore, the U.S. regulator CFTC demands that the European clearing houses must comply with their regulations when they operate in America, instead of being able to rely on rules of their home regulator. The US wants to exclude NY banks from European regulation when operating in Europe.

Come December 15th, 2014, some resolution must be reached or EU banks must cooperate with US regulators. The current stalemate puts pressure on the US banks to have significantly higher capital buffers for deals by U.S. firms ready and in place to conduct business only through clearing houses in those countries that are recognized by Europe. The NY banks want to be excluded that requirement – huge mistake if they win.

Saturday, September 20, 2014


Retirement savings gap widens between rich and poor

September 18, 2014: 7:06 PM ET
chart nest egg
In 2013, households in the lowest income bracket had a median savings balance of just $13,000, while those in the top income bracket had median savings of $452,000.

When it comes to retirement savings, the gap between the rich and poor is growing dramatically.

Last year, the typical 55- to 64-year-old household had just $111,000 saved in their 401(k)s and IRAs, which would translate into just $500 a month in retirement income, according to a report from Boston College's Center for Retirement Research that analyzed recent Federal Reserve data.

Related: Retired women: How I'm getting by
But when you break down the savings by income brackets, the numbers look even bleaker.
Households in the lowest income bracket -- those earning less than $39,000 a year -- had a median savings balance of just $13,000. Meanwhile, those in the top income bracket -- those earning $138,000 or more a year -- had a median of $452,000 saved.
And that's a gap that has widened significantly over the past decade.
America's wealthiest saw the value of their median retirement savings grow by 24% between 2004 and 2013, while low-income households couldn't even keep up with inflation as they watched their savings shrink by nearly 20%, according to the Federal Reserve's inflation-adjusted data.

Friday, September 19, 2014

One Of The Smartest VCs Of All Time Has An Ominous Warning For The Tech Industry

One Of The Smartest VCs Of All Time Has An Ominous Warning For The Tech Industry

 Bill Gurley

Respected venture capitalist Bill Gurley is sounding the alarm on the startup industry.
Gurley says the current environment reminds him of the tech bubble that formed in the late 1990s.
Every incremental day that goes past I have this feeling a little bit more. I think that Silicon Valley as a whole or that the venture-capital community or startup community is taking on an excessive amount of risk right now. Unprecedented since ‘'99. In some ways less silly than '99 and in other ways more silly than in '99.

Gurley adds, "No one's fearful, everyone's greedy, and it will eventually end."

Gurley is a partner at Benchmark. He's invested in Uber, OpenTable, and Zillow. Benchmark has invested in Snapchat, Quip, Yelp, and many more.

Private companies are raising giant sums of money — some as much as $500 million, says Gurley. When you have that much money, you have to spend it, so companies are upping their "burn rate," or the amount of money they're willing to lose to grow their businesses.
Gurley thinks the burn rate for companies is the highest it's been since 1999. He also thinks that the number of people working at money-losing companies is the highest it's been since 1999. People think nothing of working at companies that are losing millions of dollars a year because there's an overwhelming feeling of optimism right now.

If a downturn suddenly hits the startup world, Gurley thinks it's going to take "massive" amounts of "gymnastics" for companies to readjust their businesses to cut down on the burn rate.
This is all being driven by the low cost of capital. It's relatively easy for startups to raise money right now.

All the money sloshing around in the startup world is leading to secondary problems. Landlords in San Francisco are trying to lock in startups to 10-year leases. Gurley thinks this is a sign that landlords believe their rents are at a record high, and they want to lock in the rate. If landlords thought the price was going to be higher, they wouldn't be asking for 10-year leases.
Gurley isn't cutting back on his investment, though. He's trying to be selective. He also says he's trying to advise his companies to be smart with their money.
But there's a problem with that. You can't afford to be conservative when all this money is flying around:

That's really difficult because if you have a competitor that's going to double or triple down on sales and you just decide, "Oh, well I'm not going to execute bad business decisions, I'm just going to sit back," you lose market share. So, choosing not to play the game on the field doesn't work, so you're left with trying to advise someone to be pragmatically aggressive with some type of conservative backdrop or alternative strategy in case the world shifts. But it's hard.

For what it's worth, this isn't the first time an investor has sounded the alarm. Four years ago, venture investor Fred Wilson warned of storm clouds. Other people were concerned that we were in Bubble 2.0 then, too.

But things have been pretty good since then.
And earlier this year, when Box tried to IPO, but couldn't make it to the public markets, some people wondered if the bubble was finally bursting. But it managed to raise money on the private markets. And then there's Square, which seemed to be struggling, but has managed to raise another $100 million.

A downturn is coming at some point, and companies should be prepared. But, figuring out timing of these things is nearly impossible.

Wednesday, September 17, 2014


Fed Keeps ‘Considerable Time’ Pledge as Growth ‘Moderate’(Does 'Moderate' mean Non-existant?)

Sep 17, 2014 6:29 PM ET

Sept. 17 (Bloomberg) -- Fed officials have stuck to their commitment to keep interest rates near zero for EVER AND EVER AND EVER  a "considerable time" after their bond buying program ends in October.  AND THEN RESTARTS IN 2015.  Fed Chair Janet Yellen held a press conference after the announcement. Here's everything you need to know in two minutes. (Source: Bloomberg)
The Federal Reserve stuck to its pledge to keep interest rates near zero for a “considerable time” FOR EVER AND EVER AND EVER after it stops buying assets, even as it VAGUELY outlined (WITH NO DETAILS) a strategy (Does 'strategy' mean bluff?) to exit from six years of unprecedented easing. 

“The labor market has yet (WILL NEVER) to fully recover,” Fed Chair Janet Yellen said at a press conference today after a meeting of the Federal Open Market Committee in Washington. “There are still too many people who want jobs but can’t find them.”

Yellen added that “inflation has been running below the committee’s 2 percent objective,” a contrast to the panel’s July statement that it was “somewhat closer” to its goal.

Tuesday, September 16, 2014


Eight keys to Fed’s September meeting


WASHINGTON (MarketWatch) — This week’s Federal Reserve meeting is perhaps the most closely-watched gathering of the year as the U.S. central bank prepares the groundwork for an eventual liftoff in interest rates.


There are several moving parts for investors. Here are eight things to watch for clues on when the central bank might a liftoff of short-term interest rates and what the tightening cycle might look like.
The Fed will release its policy statement and economic projections at 2 p.m. on Wednesday. Fed Chairwoman Janet Yellen will follow up with a press conference at 2:30 p.m.

Interest rates:
No change here. The Fed will keep its target fed funds rate in a range between zero and 0.25% . where it has been since December 2008.


Asset purchases:
For the seventh straight meeting, the Fed is expected to taper its bond buying program by $10 billion, bringing QE3 down to only $15 billion per month. The central bank might decide to remove language from the statement that asset purchases “are not on a preset course” as officials have signaled they intend to end the program after at the Fed’s next policy meeting on Oct. 28-29.


Forward guidance:
The biggest potential change for the market would be any change to the Fed’s pledge to keep rates low for a “considerable time” after the central bank ends its asset purchase program, expected in October.  Any change in this pledge at this week’s meeting would be a sign “as the start of the countdown to policy tightening,” said Millan Mulraine, economist at TD Securities.


Description of labor market:
Analysts will be watching closely to see if the Fed repeats its concern that there is a “significant underutilization of labor resources.” With the August job report surprisingly weak, most Fed watchers think there is no burning need to change this description.


FANTASY Dot plot:
Following the meeting the Fed will release an updated “dot-plot” showing where each member thinks is the appropriate target Fed funds rate at the end of 2015, 2016 and for the first time 2017. The current median is for rates of 1.13% at the end of 2015 and 2.5% at the end of 2016. Michael Hanson, economist at Bank of America Merrill Lynch, said there is a good chance that there will be upward drift in the 2015 and 2016 dots. He expects the median dot for 2017 to be in the 3.25% to 3.5% range, just below the 3.75% long-run funds rate. “The risk is for markets to push rates up, particularly on the short end of the yield curve, in response to the dots.

Economic projections:
The Fed will be updating their economic projections for 2014 and 2015. Paul Ashworth, economist at Capital Economics, said the Fed might lower its mid-June 2014 unemployment rate forecast slightly from 6.0% to 6.1%. But the Fed’s forecast of growth and inflation this year seem about right. The Fed is forecasting 2.1% to 2.3% real GDP growth this year and for inflation, as measured by the personal consumption expenditure index, to average 1.5% to 1.7%. “With little pressure to change their 2014 projections, we see no reason why officials would want to make any revisions to their 2015 forecasts either,” Ashworth said.


Exit strategy:
The Fed could agree on, and publish, an update of their exit principles. The Fed last published these principles in June 2011. The Fed has operational questions to decide like how it can hike the fed funds rate with such a large balance sheet. Other issues include whether to stop reinvesting proceeds of maturing assets and whether to sell assets from its balance sheet.


Monday, September 15, 2014

10 Reasons to buy gold while it's still cheap: from today's headlines:

10.  Ebola.  What if it spreads?

CDC: ‘It’s Gone Beyond An Ebola Crisis To A Humanitarian Crisis’

Global Drought Conditions Are Drying Out Several Regions And Sparking Food Production Concerns 

8.  Scotland. What if separatist movements spread?

BREMMER: If Scotland Votes For Independence, Prepare For The European 'Contagion' Effect Across Europe

7.  Terror.

ISIS: The first terror group to build an Islamic state?

6 War in the Middle east.  What if we go back in?

 Iraq crisis: Obama to set out 'US offensive against IS'

5. Slowing Global Growth. 

IMF warns of potential risks to global growth

4. Systematic Destruction of the Middle Class. 

How The $1.2 Trillion College Debt Crisis Is Crippling Students, Parents And The Economy

3. Central bank balance sheets. 

Global debt enters terminal velocity mode: Why central banks have no intention of slowing their public and private debt binge.

2. Derivatives: What happens when they blow up?

 Global Growth Threatened in $693 Trillion Derivatives Review

1. World War Three.  Not so far fetched.

The Russia-China axis and its threat to West