Source: http://www.pcdf.org/1996/15hotson.htm
PCDForum Article #15 Release Date June 1, 1996
UNDERSTANDING MONEY
by John H. Hotson
An understanding of the true nature of money is essential for those seeking economic reforms toward the creation of sustainable societies. People today have more erroneous ideas about money than Victorians had about sex, so please read the following with care.
Let's begin with the distinction between "legal tender" money which only the government or its agency, the Bank of Canada in the case of Canada, can create, and the "money" created by private banks-and increasingly by "near banks". If you happen to have a Bank of Canada note, on it you will read the words "This note is legal tender."
These notes, and checks drawn on the Bank of Canada, are the only legal money in Canada. What that means is that if you owe someone $20 and you give him a $20 bill he is paid and if he refuses payment in this form you are absolved of the debt. By contrast, he does not have to accept your check drawn on a private bank, or even a certified check of a private bank. Money issued by the Bank of Canada is sometimes called "Right of Purchase" money to distinguish it from "Promise to Pay" money created by private banks.
While private banks are in effect creating money out of nothing, they are providing an important service as their "promise to pay money" is for many purposes safer and more convenient to use and store than actual cash. Furthermore, it costs the banks billions of dollars to maintain the payments system that clears your check back to your account and to keep the necessary records. All those nice, or not so nice, people who work in those banks, deciding who gets a loan and what happens if they can't pay have to be paid their salaries. Banks also have to pay phone bills, electricity, heat and so on. What they create is intangible, but at the same time very real. Essentially, the bank is substituting its promise to pay-which is accepted as money-for your promise to pay, which is not.
Today only about 4 percent of the money in circulation in Canada is Bank of Canada legal tender. In other words, 96 percent of our money is created by private banks. In 1945 the Bank of Canada accounted for 27 percent of our money. At that time the bank rate of interest was only 1.5 percent and the Canadian economy boomed.
Some 96 percent of the "money" we are now using is not Bank of Canada "legal tender," but rather the promise of private banks to pay the bearer Bank of Canada legal tender on demand. This promise is what a private bank provides for you when you take out a loan with the promise to repay it with interest. The bank knows that mostly you don't want legal tender. What you want is a checking account or a bank issued check for the amount borrowed so that you can send the bank's promise-to-pay to folks you owe money to-folks who also don't want legal tender, but do want to deposit your check in their own bank account.
The money supply of Canada increases at the moment a bank issues you a loan. As you repay your loan the money supply shrinks. So money is being created and destroyed every day.
Banking came into existence as a fraud. The fraud was legalized and we've been living with the consequences, both good and bad, ever since. Even so it is also a great invention-right up there with fire, the wheel, and the steam engine.
In the 16th century as the gold and silver the Spanish had stolen from the American Indians poured into Europe, coins grew larger, more plentiful and heavy. Merchants needed a safe place to keep them when they weren't needed. The goldsmiths had large safes and fierce dogs and it became customary to leave coins on "safe deposit" with them. Next people saw that a "gold certificate" or warehouse receipt signed by the goldsmith was more convenient to circulate than those heavy coins made of soft metals that quickly wore out if they passed hand to hand. So the smiths printed up receipts in convenient denominations promising payment in gold to whomever presented the receipt. Some people took to writing notes to the smith ordering him to transfer the ownership of some of their coins to someone else. Thus the personal check was born.
Then one day one of the smiths had a brilliant, and wholly dishonest, idea. He noticed that people so much preferred his paper money to its "gold backing" that the gold in his vault hardly circulated-some of it hadn't moved in years. So he thought, "I could print up some extra gold certificates and lend them out to gain the interest." The idea was irresistible, and thus banking was born!
Just 300 years ago, in 1694, William Patterson talked King William III into chartering a private bank with the official sounding title of "The Bank of England." The King had another war to fight with France's King Louis XIV and not much money to pay for it. Being a Dutchman, he was unpopular with the British Parliament and it balked at voting the needed taxes. The royal credit was zilch because of his predecessors' extravagance. What to do?
He jumped at Patterson's promise to lend him lots of "Bank of England Notes"-which had little or no gold "backing"-at a reasonable sounding 3 percent interest. Thus national debt was born.
King William seems never to have asked His Royal Self the obvious question, "Why the hell should I pay William Patterson interest to print money for me? Why don't I get a printing press and print some money myself?" Nor did he notice that his humble subjects in the Massachusetts Bay Colony, in what would one day become the United States, had already come to just this solution to solve a similar problem.
In 1690, the Massachusetts Bay Colony decided to do its bit in King William's War by invading Canada. The soldiers were told, "We can't pay you, but the French have lots of silver. So beat them out of it and we will pay you with the spoils." But the French won and the soldiers came back to Boston sore, mean and unpaid. Necessity being the mother of invention, a bright Yankee named Benjamin Franklin thought of printing up government "promissory notes," declaring them "legal tender" and using them to pay the soldiers. That worked so well that the other colonies copied the idea. From that day until the American Revolution (1775-1782) there were no banks in the 13 British North American colonies.
By the time of the Revolution, Pennsylvania was the richest place on earth. Franklin liked to boast that part of the credit was due to the government money he printed. As he pointed out, the government could spend the money into circulation for a new bridge or school, then tax the cost back over the useful life of the project. It could also lend the money to businessmen at 5 percent interest instead of the 10 percent the British banks charged. Or it could transfer the money into circulation to take care of widows, orphans and other unfortunates. Pennsylvania made so much money out of creating money-and selling off lands stolen from the Indians-that it hardly had to levy any taxes.
When word of this reached Great Britain, the Bank of England decided to destroy the competition of the colonial money. It got Parliament to forbid the colonies to produce any more of the stuff and the fat was on the fire. The Continental Congress met and defied Parliament and the King by issuing its own currency-the Continental. As Franklin saw it, the attempt of Britain to restrict the coloniess from issuing paper money was one of the main causes of the Revolution.
The Continentals paid for most of the cost of the revolution. Since they had to be overissued, prices rose greatly. Much of the inflation, however, was caused by massive British counterfeiting of the Continentals. "You revolting Yankees like paper money? Here! Have lots of it!" So Americans still have a saying. "Not worth a Continental." After the war banking came to America.
Some historians have much criticized this method of financing the American Revolution and held up British practice as a model of "sound finance." However, as William Hixson shows in his book, Triumph of the Bankers, those historians have it backwards. According to Hixson, the total cost of the war to the Americans was about $250 million and much of this was financed by the "Continentals" and other paper monies. An additional war debt of $56.7 million accumulated some $70 million in interest before it was all paid off in 1836.
The direct war costs to the British government came to about $500 million. However, the British financed their side of the war almost entirely with borrowed money. Since they have never since reduced their national debt below $500 million, they still owe this money! Assuming a modest average interest rate of 4 percent, the British taxpayer has by this time paid the British bondholder over $4 billion in interest on the initial $500 million loan-and is still paying! Sound finance?
What a pity that King William did not have a Benjamin Franklin to advise him! What a pity that the wisdom of Franklin was lost and Alexander Hamilton was able subsequently to charter the Bank of The United States modeled directly on the Bank of England! What a pity that many historians, like many non-historians, so badly misunderstand money and banking!
The financial system the world has evolved on the Bank of England model is not sustainable. It creates nearly all money as debt. Such money only exists as long as someone is willing and able to pay interest on it. It disappears, wholly or partially, in recurring financial crises. Such a system requires that new debt must be created faster than principal and interest payments fall due on old debt.
A sustainable financial system would enable the real economy to be maintained decade after decade and century after century at its full employment potential without recurring inflation and recession. By this standard, a financial system that creates money only through the creation of debt is inherently unsustainable.
When a bank makes a loan, the principal amount of the loan is added to the borrower's bank balance. The borrower, however, has promised to repay the loan plus interest even though the loan has created only the amount of money required to repay the principal-but not the amount of the interest. Therefore unless indebtedness continually grows it is impossible for all loans to be repaid as they come due. Furthermore, during the life of a loan some of the money will be saved and re-lent by individual bond purchasers, by savings banks, insurance companies etc. These loans do not create new money, but they do create debt. While we use only one mechanism-bank loans-to create money, we use several mechanisms to create debt, thus making it inevitable that debt will grow faster than the money with which to pay it. Recurring cycles of inflation, recession, and depression are a nearly inevitable consequence.
If, in the attempt to arrest the price inflation resulting from an excessive rate of debt formation, the monetary authorities raise the rate of interest, the result is likely to be a financial panic. This in turn may result in a sharp cutback in borrowing. Monetary authorities respond to bail out the system by increasing bank reserves. Governments may also respond by increasing the public debt-risking both inflation and growing government deficits.
Governments got into this mess by violating four common sense rules regarding their fiscal and monetary policies. These rules are:
1. No sovereign government should ever, under any circumstances, give over democratic control of its money supply to bankers.
2. No sovereign government should ever, under any circumstances, borrow any money from any private bank.
3. No national, provincial, or local government should borrow foreign money to increase purchases abroad when there is excessive domestic unemployment.
4. Governments, like businesses, should distinguish between "capital" and "current" expenditures, and when it is prudent to do so, finance capital improvements with money the government has created for itself.
A few words about the first three of these rules, as the fourth rule has been discussed extensively elsewhere.
1. There is persistent pressure from central bankers and academic economists to free central banks from the obligation to consider the effects of their actions upon employment and output levels so that they can concentrate on price stability. This is a very bad idea indeed. Dominated by bankers and economists, central banks are entirely too prone to give exclusive attention to creditor interests to the exclusion of worker interests. Amending central bank charters to give them independence from democratic oversight, or to set up "price stability" as their only goal would complete their subjection to banker interests. Canada's own Mackenzie King said it all, "Without Government creation of money, talk of sovereignty and democracy is futile."
2. Anyone who understands that banks create the money they lend can see that it makes no sense for a sovereign government, which can create money at near zero cost, to borrow money at high cost from a private bank. The fact that most governments do borrow from private banks is one of the greatest errors of our times. If a government needs money created to pay for public spending it should create the money itself through its own bank; or spend the money debt and interest free as the United States did during the Revolution and again during the Civil War. If a government does not wish to "monetize" its deficits during periods of unusual need such as wartime, it should either make up the deficit with higher taxes or borrow only from the non-bank public-which cannot create the money it lends to the government.
3. One of the most mistaken ideas, with which Canadians especially are cursed, is the idea that a country should maintain its interest rates higher than those of its main trading partners "to attract foreign investment." To begin with, high interest rates inhibit real investment spending on new buildings, machinery and equipment by diverting funds to finance government deficits. Furthermore, the foreign funds attracted to Canada by high interest rates cannot be spent on Canadian employees and products. They are only useful for importing foreign goods and making payments on foreign debts. Moreover, these funds bid up the value of the Canadian dollar in foreign exchange markets, giving foreign goods a domestic price advantage over similar goods produced in Canada, while making it harder for Canada to export. Thus the inflow of foreign funds actually contributes to a "current account deficit" and depresses the Canadian economy. Those who argue that Canada must borrow on "capital account" because she has a "current account deficit" have cause and effect totally reversed. Canada has a current account deficit because she is borrowing on capital account. What she needs to do is to stop borrowing, lower interest rates until she stops attracting foreign funds, and let the Canadian dollar find its own level in the foreign currency markets.
When the Bank of Canada encourages the Canadian government, provinces, and municipalities to borrow in New York and Tokyo it is a betrayal of Canada. Where should they borrow when new money is needed for government spending? They should borrow at the government owned Bank of Canada, paying near zero interest rates-just sufficient to cover the Bank's running expenses.
John H. Hotson was professor emeritus of economics University of Waterloo and executive director of the Committee on Monetary and Economic Reform (COMER), a Canadian based network of economists working for economic and monetary reform. This article is based on a series he published in the October 1994, November 1994, and January 1995 issues of Economic Reform, the COMER newsletter, Comer Publications, 3284 Yonge St., Suite 500, Toronto, Ontario, M4N 3M7, fax (416) 486-4674. He gave the PCDForum permission to use this material only five days before his untimely death on January 21, 1996 following heart surgery.
People-Centered Development Forum papers may be reprinted, and distributed freely with appropriate credits without prior permission.
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Wednesday, October 13, 2010
Who's afraid of free energy?
Oil barons, banksters, nuclear dealers, war-mongers, colonialists, etc...
Source: http://www.viewzone2.com/verichipx.html
Bob Boyce's Story
Source: http://www.viewzone2.com/verichipx.html
Bob Boyce's Story
Science. It ain't what it used to be. (If it ever was!)
This is not science; other forces are at work.
Source: http://www.prisonplanet.com/hal-lewis-my-resignation-from-the-american-physical-society-%e2%80%93-an-important-moment-in-science-history.html
Hal Lewis: My Resignation From The American Physical Society – an important moment in science history
Anthony Watts
Watts Up With That?
Oct 9, 2010
We’ve previously covered the APS here, when I wrote:
While Copenhagen and its excesses rage, a quiet revolution is starting.
Indeed, not so quiet now. It looks like it is getting ugly inside with the public airing of the resignation of a very prominent member who writes:
I don’t believe that any real physicist, nay scientist, can read that stuff without revulsion. I would almost make that revulsion a definition of the word scientist.
…
In the interim the ClimateGate scandal broke into the news, and the machinations of the principal alarmists were revealed to the world. It was a fraud on a scale I have never seen, and I lack the words to describe its enormity. Effect on the APS position: none. None at all. This is not science; other forces are at work.- Hal Lewis
Below is his resignation letter made public today, via the GWPF.
This is an important moment in science history. I would describe it as a letter on the scale of Martin Luther, nailing his 95 theses to the Wittenburg church door. It is worthy of repeating this letter in entirety on every blog that discusses science.
What I would really like to see though, is this public resignation letter given the same editorial space as Michael Mann in today’s Washington Post.
Readers, we can do this. Here’s the place at WaPo to ask for it. For anyone writing to the WaPo, the national@washpost.com, is the national news editorial desk. Spread the word on other blogs. Let’s see if they have enough integrity to provide a counterpoint. – Anthony
==========================================
Hal Lewis: My Resignation From The American Physical Society – an important moment in science history 260310banner2
Sent: Friday, 08 October 2010 17:19 Hal Lewis
From: Hal Lewis, University of California, Santa Barbara
To: Curtis G. Callan, Jr., Princeton University, President of the American Physical Society
6 October 2010
Dear Curt:
When I first joined the American Physical Society sixty-seven years ago it was much smaller, much gentler, and as yet uncorrupted by the money flood (a threat against which Dwight Eisenhower warned a half-century ago).
Indeed, the choice of physics as a profession was then a guarantor of a life of poverty and abstinence—it was World War II that changed all that. The prospect of worldly gain drove few physicists. As recently as thirty-five years ago, when I chaired the first APS study of a contentious social/scientific issue, The Reactor Safety Study, though there were zealots aplenty on the outside there was no hint of inordinate pressure on us as physicists. We were therefore able to produce what I believe was and is an honest appraisal of the situation at that time. We were further enabled by the presence of an oversight committee consisting of Pief Panofsky, Vicki Weisskopf, and Hans Bethe, all towering physicists beyond reproach. I was proud of what we did in a charged atmosphere. In the end the oversight committee, in its report to the APS President, noted the complete independence in which we did the job, and predicted that the report would be attacked from both sides. What greater tribute could there be?
How different it is now. The giants no longer walk the earth, and the money flood has become the raison d’être of much physics research, the vital sustenance of much more, and it provides the support for untold numbers of professional jobs. For reasons that will soon become clear my former pride at being an APS Fellow all these years has been turned into shame, and I am forced, with no pleasure at all, to offer you my resignation from the Society.
It is of course, the global warming scam, with the (literally) trillions of dollars driving it, that has corrupted so many scientists, and has carried APS before it like a rogue wave. It is the greatest and most successful pseudoscientific fraud I have seen in my long life as a physicist. Anyone who has the faintest doubt that this is so should force himself to read the ClimateGate documents, which lay it bare. (Montford’s book organizes the facts very well.) I don’t believe that any real physicist, nay scientist, can read that stuff without revulsion. I would almost make that revulsion a definition of the word scientist.
So what has the APS, as an organization, done in the face of this challenge? It has accepted the corruption as the norm, and gone along with it. For example:
1. About a year ago a few of us sent an e-mail on the subject to a fraction of the membership. APS ignored the issues, but the then President immediately launched a hostile investigation of where we got the e-mail addresses. In its better days, APS used to encourage discussion of important issues, and indeed the Constitution cites that as its principal purpose. No more. Everything that has been done in the last year has been designed to silence debate
2. The appallingly tendentious APS statement on Climate Change was apparently written in a hurry by a few people over lunch, and is certainly not representative of the talents of APS members as I have long known them. So a few of us petitioned the Council to reconsider it. One of the outstanding marks of (in)distinction in the Statement was the poison word incontrovertible, which describes few items in physics, certainly not this one. In response APS appointed a secret committee that never met, never troubled to speak to any skeptics, yet endorsed the Statement in its entirety. (They did admit that the tone was a bit strong, but amazingly kept the poison word incontrovertible to describe the evidence, a position supported by no one.) In the end, the Council kept the original statement, word for word, but approved a far longer “explanatory” screed, admitting that there were uncertainties, but brushing them aside to give blanket approval to the original. The original Statement, which still stands as the APS position, also contains what I consider pompous and asinine advice to all world governments, as if the APS were master of the universe. It is not, and I am embarrassed that our leaders seem to think it is. This is not fun and games, these are serious matters involving vast fractions of our national substance, and the reputation of the Society as a scientific society is at stake.
3. In the interim the ClimateGate scandal broke into the news, and the machinations of the principal alarmists were revealed to the world. It was a fraud on a scale I have never seen, and I lack the words to describe its enormity. Effect on the APS position: none. None at all. This is not science; other forces are at work.
4. So a few of us tried to bring science into the act (that is, after all, the alleged and historic purpose of APS), and collected the necessary 200+ signatures to bring to the Council a proposal for a Topical Group on Climate Science, thinking that open discussion of the scientific issues, in the best tradition of physics, would be beneficial to all, and also a contribution to the nation. I might note that it was not easy to collect the signatures, since you denied us the use of the APS membership list. We conformed in every way with the requirements of the APS Constitution, and described in great detail what we had in mind—simply to bring the subject into the open.
5. To our amazement, Constitution be damned, you declined to accept our petition, but instead used your own control of the mailing list to run a poll on the members’ interest in a TG on Climate and the Environment. You did ask the members if they would sign a petition to form a TG on your yet-to-be-defined subject, but provided no petition, and got lots of affirmative responses. (If you had asked about sex you would have gotten more expressions of interest.) There was of course no such petition or proposal, and you have now dropped the Environment part, so the whole matter is moot. (Any lawyer will tell you that you cannot collect signatures on a vague petition, and then fill in whatever you like.) The entire purpose of this exercise was to avoid your constitutional responsibility to take our petition to the Council.
6. As of now you have formed still another secret and stacked committee to organize your own TG, simply ignoring our lawful petition.
APS management has gamed the problem from the beginning, to suppress serious conversation about the merits of the climate change claims. Do you wonder that I have lost confidence in the organization?
I do feel the need to add one note, and this is conjecture, since it is always risky to discuss other people’s motives. This scheming at APS HQ is so bizarre that there cannot be a simple explanation for it. Some have held that the physicists of today are not as smart as they used to be, but I don’t think that is an issue. I think it is the money, exactly what Eisenhower warned about a half-century ago. There are indeed trillions of dollars involved, to say nothing of the fame and glory (and frequent trips to exotic islands) that go with being a member of the club. Your own Physics Department (of which you are chairman) would lose millions a year if the global warming bubble burst. When Penn State absolved Mike Mann of wrongdoing, and the University of East Anglia did the same for Phil Jones, they cannot have been unaware of the financial penalty for doing otherwise. As the old saying goes, you don’t have to be a weatherman to know which way the wind is blowing. Since I am no philosopher, I’m not going to explore at just which point enlightened self-interest crosses the line into corruption, but a careful reading of the ClimateGate releases makes it clear that this is not an academic question.
I want no part of it, so please accept my resignation. APS no longer represents me, but I hope we are still friends.
Hal
==========================================================
Harold Lewis is Emeritus Professor of Physics, University of California, Santa Barbara, former Chairman; Former member Defense Science Board, chmn of Technology panel; Chairman DSB study on Nuclear Winter; Former member Advisory Committee on Reactor Safeguards; Former member, President’s Nuclear Safety Oversight Committee; Chairman APS study on Nuclear Reactor Safety Chairman Risk Assessment Review Group; Co-founder and former Chairman of JASON; Former member USAF Scientific Advisory Board; Served in US Navy in WW II; books: Technological Risk (about, surprise, technological risk) and Why Flip a Coin (about decision making)
Source: http://www.prisonplanet.com/hal-lewis-my-resignation-from-the-american-physical-society-%e2%80%93-an-important-moment-in-science-history.html
Hal Lewis: My Resignation From The American Physical Society – an important moment in science history
Anthony Watts
Watts Up With That?
Oct 9, 2010
We’ve previously covered the APS here, when I wrote:
While Copenhagen and its excesses rage, a quiet revolution is starting.
Indeed, not so quiet now. It looks like it is getting ugly inside with the public airing of the resignation of a very prominent member who writes:
I don’t believe that any real physicist, nay scientist, can read that stuff without revulsion. I would almost make that revulsion a definition of the word scientist.
…
In the interim the ClimateGate scandal broke into the news, and the machinations of the principal alarmists were revealed to the world. It was a fraud on a scale I have never seen, and I lack the words to describe its enormity. Effect on the APS position: none. None at all. This is not science; other forces are at work.- Hal Lewis
Below is his resignation letter made public today, via the GWPF.
This is an important moment in science history. I would describe it as a letter on the scale of Martin Luther, nailing his 95 theses to the Wittenburg church door. It is worthy of repeating this letter in entirety on every blog that discusses science.
What I would really like to see though, is this public resignation letter given the same editorial space as Michael Mann in today’s Washington Post.
Readers, we can do this. Here’s the place at WaPo to ask for it. For anyone writing to the WaPo, the national@washpost.com, is the national news editorial desk. Spread the word on other blogs. Let’s see if they have enough integrity to provide a counterpoint. – Anthony
==========================================
Hal Lewis: My Resignation From The American Physical Society – an important moment in science history 260310banner2
Sent: Friday, 08 October 2010 17:19 Hal Lewis
From: Hal Lewis, University of California, Santa Barbara
To: Curtis G. Callan, Jr., Princeton University, President of the American Physical Society
6 October 2010
Dear Curt:
When I first joined the American Physical Society sixty-seven years ago it was much smaller, much gentler, and as yet uncorrupted by the money flood (a threat against which Dwight Eisenhower warned a half-century ago).
Indeed, the choice of physics as a profession was then a guarantor of a life of poverty and abstinence—it was World War II that changed all that. The prospect of worldly gain drove few physicists. As recently as thirty-five years ago, when I chaired the first APS study of a contentious social/scientific issue, The Reactor Safety Study, though there were zealots aplenty on the outside there was no hint of inordinate pressure on us as physicists. We were therefore able to produce what I believe was and is an honest appraisal of the situation at that time. We were further enabled by the presence of an oversight committee consisting of Pief Panofsky, Vicki Weisskopf, and Hans Bethe, all towering physicists beyond reproach. I was proud of what we did in a charged atmosphere. In the end the oversight committee, in its report to the APS President, noted the complete independence in which we did the job, and predicted that the report would be attacked from both sides. What greater tribute could there be?
How different it is now. The giants no longer walk the earth, and the money flood has become the raison d’être of much physics research, the vital sustenance of much more, and it provides the support for untold numbers of professional jobs. For reasons that will soon become clear my former pride at being an APS Fellow all these years has been turned into shame, and I am forced, with no pleasure at all, to offer you my resignation from the Society.
It is of course, the global warming scam, with the (literally) trillions of dollars driving it, that has corrupted so many scientists, and has carried APS before it like a rogue wave. It is the greatest and most successful pseudoscientific fraud I have seen in my long life as a physicist. Anyone who has the faintest doubt that this is so should force himself to read the ClimateGate documents, which lay it bare. (Montford’s book organizes the facts very well.) I don’t believe that any real physicist, nay scientist, can read that stuff without revulsion. I would almost make that revulsion a definition of the word scientist.
So what has the APS, as an organization, done in the face of this challenge? It has accepted the corruption as the norm, and gone along with it. For example:
1. About a year ago a few of us sent an e-mail on the subject to a fraction of the membership. APS ignored the issues, but the then President immediately launched a hostile investigation of where we got the e-mail addresses. In its better days, APS used to encourage discussion of important issues, and indeed the Constitution cites that as its principal purpose. No more. Everything that has been done in the last year has been designed to silence debate
2. The appallingly tendentious APS statement on Climate Change was apparently written in a hurry by a few people over lunch, and is certainly not representative of the talents of APS members as I have long known them. So a few of us petitioned the Council to reconsider it. One of the outstanding marks of (in)distinction in the Statement was the poison word incontrovertible, which describes few items in physics, certainly not this one. In response APS appointed a secret committee that never met, never troubled to speak to any skeptics, yet endorsed the Statement in its entirety. (They did admit that the tone was a bit strong, but amazingly kept the poison word incontrovertible to describe the evidence, a position supported by no one.) In the end, the Council kept the original statement, word for word, but approved a far longer “explanatory” screed, admitting that there were uncertainties, but brushing them aside to give blanket approval to the original. The original Statement, which still stands as the APS position, also contains what I consider pompous and asinine advice to all world governments, as if the APS were master of the universe. It is not, and I am embarrassed that our leaders seem to think it is. This is not fun and games, these are serious matters involving vast fractions of our national substance, and the reputation of the Society as a scientific society is at stake.
3. In the interim the ClimateGate scandal broke into the news, and the machinations of the principal alarmists were revealed to the world. It was a fraud on a scale I have never seen, and I lack the words to describe its enormity. Effect on the APS position: none. None at all. This is not science; other forces are at work.
4. So a few of us tried to bring science into the act (that is, after all, the alleged and historic purpose of APS), and collected the necessary 200+ signatures to bring to the Council a proposal for a Topical Group on Climate Science, thinking that open discussion of the scientific issues, in the best tradition of physics, would be beneficial to all, and also a contribution to the nation. I might note that it was not easy to collect the signatures, since you denied us the use of the APS membership list. We conformed in every way with the requirements of the APS Constitution, and described in great detail what we had in mind—simply to bring the subject into the open.
5. To our amazement, Constitution be damned, you declined to accept our petition, but instead used your own control of the mailing list to run a poll on the members’ interest in a TG on Climate and the Environment. You did ask the members if they would sign a petition to form a TG on your yet-to-be-defined subject, but provided no petition, and got lots of affirmative responses. (If you had asked about sex you would have gotten more expressions of interest.) There was of course no such petition or proposal, and you have now dropped the Environment part, so the whole matter is moot. (Any lawyer will tell you that you cannot collect signatures on a vague petition, and then fill in whatever you like.) The entire purpose of this exercise was to avoid your constitutional responsibility to take our petition to the Council.
6. As of now you have formed still another secret and stacked committee to organize your own TG, simply ignoring our lawful petition.
APS management has gamed the problem from the beginning, to suppress serious conversation about the merits of the climate change claims. Do you wonder that I have lost confidence in the organization?
I do feel the need to add one note, and this is conjecture, since it is always risky to discuss other people’s motives. This scheming at APS HQ is so bizarre that there cannot be a simple explanation for it. Some have held that the physicists of today are not as smart as they used to be, but I don’t think that is an issue. I think it is the money, exactly what Eisenhower warned about a half-century ago. There are indeed trillions of dollars involved, to say nothing of the fame and glory (and frequent trips to exotic islands) that go with being a member of the club. Your own Physics Department (of which you are chairman) would lose millions a year if the global warming bubble burst. When Penn State absolved Mike Mann of wrongdoing, and the University of East Anglia did the same for Phil Jones, they cannot have been unaware of the financial penalty for doing otherwise. As the old saying goes, you don’t have to be a weatherman to know which way the wind is blowing. Since I am no philosopher, I’m not going to explore at just which point enlightened self-interest crosses the line into corruption, but a careful reading of the ClimateGate releases makes it clear that this is not an academic question.
I want no part of it, so please accept my resignation. APS no longer represents me, but I hope we are still friends.
Hal
==========================================================
Harold Lewis is Emeritus Professor of Physics, University of California, Santa Barbara, former Chairman; Former member Defense Science Board, chmn of Technology panel; Chairman DSB study on Nuclear Winter; Former member Advisory Committee on Reactor Safeguards; Former member, President’s Nuclear Safety Oversight Committee; Chairman APS study on Nuclear Reactor Safety Chairman Risk Assessment Review Group; Co-founder and former Chairman of JASON; Former member USAF Scientific Advisory Board; Served in US Navy in WW II; books: Technological Risk (about, surprise, technological risk) and Why Flip a Coin (about decision making)
Get ready now.
Source: http://www.telegraph.co.uk/finance/financetopics/recession/5166956/IMF-warns-over-parallels-to-Great-Depression.html
IMF warns over parallels to Great Depression
The International Monetary Fund has warned of "worrisome parallels" between the current global crisis and the Great Depression, despite the unprecedented steps already taken by central banks and governments worldwide.
By Ambrose Evans-Pritchard, International Business Editor
Published: 8:16PM BST 16 Apr 2009
This recession is likely to be "unusually long and severe, and the recovery sluggish," said the Fund, releasing two advance chapters from its World Economic Outlook. However, it warned there is a risk that it could spiral down into a full-blown slump unless further action is taken to stop "feedback effects" gathering force.
Dominique Strauss-Kahn, head of the IMF, said millions of people risk being pushed back into poverty as the economic storm ravages the most vulnerable countries. "The human consequences could be absolutely devastating. This is a truly global crisis, and nobody is escaping," he said.
"The free-fall in the global economy may be starting to abate, with a recovery emerging in 2010, but this depends crucially on the right policies being adopted today."
Mr Strauss-Kahn called for a urgent action to "cleanse banks" of toxic assets and for further fiscal stimulus beyond the 2pc of global GDP already agreed. The snag is that high-debt countries may have hit the limits already.
"The impact becomes negative for debt levels that exceed 60pc of GDP," said the Fund.
While no countries were named, this would raise questions about Japan, Germany, France, Italy and ultimately Britain and the US after their bank rescues.
The IMF said the US is at the epicentre of this crisis just as it was in the Depression, setting the two episodes apart from normal downturns. However, the risks are greater this time. "While the credit boom in the 1920s was largely specific to the US, the boom during 2004-2007 was global, with increased leverage and risk-taking in advanced economies and many emerging economies. Levels of integration are now much higher than during the inter-war period, so US financial shocks have a larger impact," it said.
The IMF said the global financial system is still under acute stress, with output tumbling and inflation falling towards zero in key nations. "The risks of debt deflation have increased," it said.
Abrupt halts in capital flows can have "dire consequences" for emerging economies, it said. Eastern Europe has already suffered the effects, with a 17.6pc fall in industrial production in February. The region is highly vulnerable to the credit crunch since it owes more than 50pc of its GDP to Western banks.
Synchronised world recessions striking all major regions are "historically rare" events, the Fund said. They last one and a half times as long typical downturns, and are followed by painfully slow recoveries.
Some advice from Dr. Ravi Batra's book, "The Great Depression of 1990." Yeah, his timing is two decades off but I thought his reasoning was sound when I read the book. It was just a matter of time before flawed economic theories created what they were intended to.
from pages 160-170
Summary:
1. Spend less and save more.
2. Reduce your debt as much as possible.
3-5. We're way past these points.
6. If, after late 1989 (2010), the stock market crashes, immediately cash in your IRAs, Keogh plans, and, if possible, other pension programs regardless of any penalties for premature withdrawal.
7. Then start buying gold and silver coins and, possibly, gold shares.
8. After 1991 (2010), if the depression has already taken hold, get in the maximum survival position; namely, hold only cash and precious metals, kept partly at home and partly in a safe-deposit box.
See also my blog on "The Hopi Survival Kit" written earlier this year of 2010.
1. Get out of debt.
2. Become self-sufficient.
3. Stockpile food and supplies.
4. The only safe investment is yourself.
HH
IMF warns over parallels to Great Depression
The International Monetary Fund has warned of "worrisome parallels" between the current global crisis and the Great Depression, despite the unprecedented steps already taken by central banks and governments worldwide.
By Ambrose Evans-Pritchard, International Business Editor
Published: 8:16PM BST 16 Apr 2009
This recession is likely to be "unusually long and severe, and the recovery sluggish," said the Fund, releasing two advance chapters from its World Economic Outlook. However, it warned there is a risk that it could spiral down into a full-blown slump unless further action is taken to stop "feedback effects" gathering force.
Dominique Strauss-Kahn, head of the IMF, said millions of people risk being pushed back into poverty as the economic storm ravages the most vulnerable countries. "The human consequences could be absolutely devastating. This is a truly global crisis, and nobody is escaping," he said.
"The free-fall in the global economy may be starting to abate, with a recovery emerging in 2010, but this depends crucially on the right policies being adopted today."
Mr Strauss-Kahn called for a urgent action to "cleanse banks" of toxic assets and for further fiscal stimulus beyond the 2pc of global GDP already agreed. The snag is that high-debt countries may have hit the limits already.
"The impact becomes negative for debt levels that exceed 60pc of GDP," said the Fund.
While no countries were named, this would raise questions about Japan, Germany, France, Italy and ultimately Britain and the US after their bank rescues.
The IMF said the US is at the epicentre of this crisis just as it was in the Depression, setting the two episodes apart from normal downturns. However, the risks are greater this time. "While the credit boom in the 1920s was largely specific to the US, the boom during 2004-2007 was global, with increased leverage and risk-taking in advanced economies and many emerging economies. Levels of integration are now much higher than during the inter-war period, so US financial shocks have a larger impact," it said.
The IMF said the global financial system is still under acute stress, with output tumbling and inflation falling towards zero in key nations. "The risks of debt deflation have increased," it said.
Abrupt halts in capital flows can have "dire consequences" for emerging economies, it said. Eastern Europe has already suffered the effects, with a 17.6pc fall in industrial production in February. The region is highly vulnerable to the credit crunch since it owes more than 50pc of its GDP to Western banks.
Synchronised world recessions striking all major regions are "historically rare" events, the Fund said. They last one and a half times as long typical downturns, and are followed by painfully slow recoveries.
Some advice from Dr. Ravi Batra's book, "The Great Depression of 1990." Yeah, his timing is two decades off but I thought his reasoning was sound when I read the book. It was just a matter of time before flawed economic theories created what they were intended to.
from pages 160-170
Summary:
1. Spend less and save more.
2. Reduce your debt as much as possible.
3-5. We're way past these points.
6. If, after late 1989 (2010), the stock market crashes, immediately cash in your IRAs, Keogh plans, and, if possible, other pension programs regardless of any penalties for premature withdrawal.
7. Then start buying gold and silver coins and, possibly, gold shares.
8. After 1991 (2010), if the depression has already taken hold, get in the maximum survival position; namely, hold only cash and precious metals, kept partly at home and partly in a safe-deposit box.
See also my blog on "The Hopi Survival Kit" written earlier this year of 2010.
1. Get out of debt.
2. Become self-sufficient.
3. Stockpile food and supplies.
4. The only safe investment is yourself.
HH
Grasshopper vs. Ant.
It doesn't hurt to prepare in case things go bad --and they might the way things are going.
Source: http://www.stuartwildeblog.com/sws-jottings/
Stock Exchange Collapse (sw)
DateFriday, October 8, 2010 at 5:58PM
Many famous pundits are predicting a plunge in the stock market for later this month, October 2010. All the previous famous crashes, 1929, 1987, etc, have been in October.
The markets are not so much priced by real value, but by quantitative easing. The central banks and the Federal Reserve act as gods creating money out of thin air, and financial institutions borrow that money at 0%-1/4%. They act like as a privileged aristocracy—the son’s of God. Ordinary people have to pay 4.5% or more for borrowing money, or they have no collateral at all, so they can’t borrow. These groups form the financial proletariat.
The media likes to paint the banks as evil. They are not evil; they are just welfare recipients accepting the free money offered, just like hundreds of millions of the citizens of Europe and the US accept welfare.
Nobody cares what unemployment really is, or how many homes have been repossessed, or how many small businesses go belly up. All that matters is the aristocrats have lots of free chips in the casino to feed the illusion that all’s well in the country.
For the market to come down, there has to be a perceptional shift, but the current mind-set is held up in part, by phony trade figures supplied by the government, so that shift wont happen easily.
A terrorist bomb in NY would do it, and so would the California earthquake, or an even more rapid drop in the dollar might do it. Being out of the market is safe for now.
But when the illusion collapses, the casino suffers a power cut. It will be straight down 30% or more, but I don’t know if October 2010 is it or not. (sw)
Oct082010
Gold, Gold, Gold (sw)
DateFriday, October 8, 2010 at 5:56PM
Gold has started to rocket once more. It hit $1340 yesterday.
So my prediction has come good. I’m happy for those readers that sold their assets and houses and bought gold, the property market is unlikely to ever recover.
The gold market is driven higher by the prospect of QE (quantitative easing). For the uninitiated, QE is the act of governments that are broke, like Japan’s, printing or creating massive amounts of new money out of thin air.
When the Federal Reserve in the US creates a few trillion new dollars to bail out the banks say, the old dollars previously in existence become less valuable. That’s why the US dollar is under pressure. It has fallen 10% recently.
Money is power to politicians, so cutting spending is unattractive to the political ego-soul, and they’ve milked the citizens for every cent they can. So, there’s not much blood left in that stone. Printing/creating new money is a cheap and easy alternative.
A global currency war has developed, as each country tries to debase its currency to make its exports cheaper; while paying off the national debt and lubricating their various stock markets. That’s why Wall Street is rocketing up. It’s awash with cheap money. The Feds lend to banks at a rate between 0% and ¼%.
(see Wall Street article HERE)
Don’t buy gold to make money short term, as it can go down from time-to-time, when profit taking kicks in. Hold it long term for the next threshold, which is $1650, expected by Jan 2011, or hold for $5000, expected in a couple of years time, when the QE system has farted itself into outer space and oblivion looms, as trillions upon trillions are gorged out of nowhere and the Euro has collapsed due to lies and its members’ sovereign debt.
Fifteen years ago, I wrote in my books of the coming collapse of the global-ego, it’s the fall of importance and control, and that is what we are watching now, as systems unravel bit-by-bit. (SW)
Source: http://www.stuartwildeblog.com/sws-jottings/
Stock Exchange Collapse (sw)
DateFriday, October 8, 2010 at 5:58PM
Many famous pundits are predicting a plunge in the stock market for later this month, October 2010. All the previous famous crashes, 1929, 1987, etc, have been in October.
The markets are not so much priced by real value, but by quantitative easing. The central banks and the Federal Reserve act as gods creating money out of thin air, and financial institutions borrow that money at 0%-1/4%. They act like as a privileged aristocracy—the son’s of God. Ordinary people have to pay 4.5% or more for borrowing money, or they have no collateral at all, so they can’t borrow. These groups form the financial proletariat.
The media likes to paint the banks as evil. They are not evil; they are just welfare recipients accepting the free money offered, just like hundreds of millions of the citizens of Europe and the US accept welfare.
Nobody cares what unemployment really is, or how many homes have been repossessed, or how many small businesses go belly up. All that matters is the aristocrats have lots of free chips in the casino to feed the illusion that all’s well in the country.
For the market to come down, there has to be a perceptional shift, but the current mind-set is held up in part, by phony trade figures supplied by the government, so that shift wont happen easily.
A terrorist bomb in NY would do it, and so would the California earthquake, or an even more rapid drop in the dollar might do it. Being out of the market is safe for now.
But when the illusion collapses, the casino suffers a power cut. It will be straight down 30% or more, but I don’t know if October 2010 is it or not. (sw)
Oct082010
Gold, Gold, Gold (sw)
DateFriday, October 8, 2010 at 5:56PM
Gold has started to rocket once more. It hit $1340 yesterday.
So my prediction has come good. I’m happy for those readers that sold their assets and houses and bought gold, the property market is unlikely to ever recover.
The gold market is driven higher by the prospect of QE (quantitative easing). For the uninitiated, QE is the act of governments that are broke, like Japan’s, printing or creating massive amounts of new money out of thin air.
When the Federal Reserve in the US creates a few trillion new dollars to bail out the banks say, the old dollars previously in existence become less valuable. That’s why the US dollar is under pressure. It has fallen 10% recently.
Money is power to politicians, so cutting spending is unattractive to the political ego-soul, and they’ve milked the citizens for every cent they can. So, there’s not much blood left in that stone. Printing/creating new money is a cheap and easy alternative.
A global currency war has developed, as each country tries to debase its currency to make its exports cheaper; while paying off the national debt and lubricating their various stock markets. That’s why Wall Street is rocketing up. It’s awash with cheap money. The Feds lend to banks at a rate between 0% and ¼%.
(see Wall Street article HERE)
Don’t buy gold to make money short term, as it can go down from time-to-time, when profit taking kicks in. Hold it long term for the next threshold, which is $1650, expected by Jan 2011, or hold for $5000, expected in a couple of years time, when the QE system has farted itself into outer space and oblivion looms, as trillions upon trillions are gorged out of nowhere and the Euro has collapsed due to lies and its members’ sovereign debt.
Fifteen years ago, I wrote in my books of the coming collapse of the global-ego, it’s the fall of importance and control, and that is what we are watching now, as systems unravel bit-by-bit. (SW)
Cold, dead space... now with water and organic molecules.
Source: http://www.dailymail.co.uk/sciencetech/article-1319278/Scientists-discover-second-asteroid-water-answer-life-Earth.html
The solution to how life was sparked on Earth? Scientists find SECOND asteroid with water on it
By Daily Mail Reporter
Last updated at 12:14 PM on 10th October 2010
Scientists have found water ice on an asteroid for the second time in just six months.
The discovery suggests that such ice is more common on asteroids in our section of the solar system than previously thought - and that such asteroids may have delivered much of the essentials for early life to Earth.
Two research teams found evidence of water and organic molecules on asteroid 65 Cybele.
Six months ago the teams made a similar discovery on a different rock - asteroid 24 Themis - for the first time.
The reason for life on Earth? A computer generated image shows an asteroid striking our planet
The reason for life on Earth? A computer generated image shows an asteroid striking our planet (file photo)
'This discovery suggests that this region of our solar system contains more water ice than anticipated,'Humberto Campins, of the University of Central Florida, told reporters at the 42nd American Astronomical Society's Division for Planetary Sciences annual meeting in Pasadena, California on Friday.
'And it supports the theory that asteroids may have hit Earth and brought our planet its water and the building blocks for life to form and evolve here.'
He told the meeting that the teams had used two different Nasa instruments to analsye sunlight bouncing off 65 Cybele.
Using powerful Nasa telescopes, they found what they believe is a layer of ice less than one micron thick, Campins said.
The scientists still are not sure where the ice came from, he said. But it could be primordial - that is, leftover from the beginning of the solar system's formation.
When the teams found ice on the first asteroid, 24 Themis, in April this year it change the way many think about the space rocks.
Both asteroids - found in the asteroid belt between the orbits of Jupiter and Mars - had always been considered too close to the sun to have water. Any water they may have carried at the beginning of the solar system's formation should have long evaporated by now, scientists argued.
But the fact that water appears to still exist on the space rocks, 4.6billion years later, suggests that it may have been asteroids that delivered the water that filled Earth's oceans.
The research has been accepted for publication in the journal Astronomy and Astrophysics.
Read more: http://www.dailymail.co.uk/sciencetech/article-1319278/Scientists-discover-second-asteroid-water-answer-life-Earth.html#ixzz11ysJSX00
The solution to how life was sparked on Earth? Scientists find SECOND asteroid with water on it
By Daily Mail Reporter
Last updated at 12:14 PM on 10th October 2010
Scientists have found water ice on an asteroid for the second time in just six months.
The discovery suggests that such ice is more common on asteroids in our section of the solar system than previously thought - and that such asteroids may have delivered much of the essentials for early life to Earth.
Two research teams found evidence of water and organic molecules on asteroid 65 Cybele.
Six months ago the teams made a similar discovery on a different rock - asteroid 24 Themis - for the first time.
The reason for life on Earth? A computer generated image shows an asteroid striking our planet
The reason for life on Earth? A computer generated image shows an asteroid striking our planet (file photo)
'This discovery suggests that this region of our solar system contains more water ice than anticipated,'Humberto Campins, of the University of Central Florida, told reporters at the 42nd American Astronomical Society's Division for Planetary Sciences annual meeting in Pasadena, California on Friday.
'And it supports the theory that asteroids may have hit Earth and brought our planet its water and the building blocks for life to form and evolve here.'
He told the meeting that the teams had used two different Nasa instruments to analsye sunlight bouncing off 65 Cybele.
Using powerful Nasa telescopes, they found what they believe is a layer of ice less than one micron thick, Campins said.
The scientists still are not sure where the ice came from, he said. But it could be primordial - that is, leftover from the beginning of the solar system's formation.
When the teams found ice on the first asteroid, 24 Themis, in April this year it change the way many think about the space rocks.
Both asteroids - found in the asteroid belt between the orbits of Jupiter and Mars - had always been considered too close to the sun to have water. Any water they may have carried at the beginning of the solar system's formation should have long evaporated by now, scientists argued.
But the fact that water appears to still exist on the space rocks, 4.6billion years later, suggests that it may have been asteroids that delivered the water that filled Earth's oceans.
The research has been accepted for publication in the journal Astronomy and Astrophysics.
Read more: http://www.dailymail.co.uk/sciencetech/article-1319278/Scientists-discover-second-asteroid-water-answer-life-Earth.html#ixzz11ysJSX00
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