News Items

The Revolving Door Spins Again – Former SEC Enforcer to Join Private Equity Giant KKR

by

Nothing is more important to a fully streamlined corrupt crony capitalist economy as the ever-present “revolving door” between regulatory agencies and the industries/companies they regulate. These moves have become so pervasive in American society that it is simply impossible to keep up with them all, but I try my best to cover the most egregious examples whenever possible. As a refresher, I suggest reading the following:

How Obama’s Chief Negotiators on the Trans-Pacific Partnership Treaty Received Huge Bonuses from Mega Banks

Revolving Door 2014: Former Head of the Federal Communications Commission Joins Carlyle

Journalism’s Revolving Door: Washington Post’s National Security Editor Joins the State Department

The Pentagon’s Revolving Door with Defense Contractors…Some Shocking Statistics

How Jack “Bailout Bonus” Lew Got to Treasury

It Never Ends: Top Obama Housing Advisor Jumps Ship to Wells Fargo

Meet Liz Fowler: Architect of ObamaCare Jumps Ship to Johnson & Johnson

Meet Mary Jo White: The Next SEC Chief and a Guaranteed Wall Street Patsy

I recognize that’s a lot of catching up to do, but you get my point. There were many other posts I didn’t even mention in the interest of not overdoing it.

In any event, last evening we were informed of another example. Bruce Karpati, a former top Securities and Exchange Commission lawyer, is moving on to become global chief compliance officer at private equity giant KKR. He left the SEC last May when he was  chief of the Enforcement Division’s Asset Management Unit. Naturally, he went to work for an asset manager, Prudential’s mutual fund unit specifically. Now that he thinks enough time has passed, he is going for the real money.

From the Wall Street Journal:

Bruce Karpati, a former top Securities and Exchange Commission lawyer, is heading to private-equity giant KKR & Co. to become global chief compliance officer, said people familiar with the matter.

Mr. Karpati, most recently the chief compliance officer for Prudential Financial Inc’s mutual fund business, is expected to start at KKR later this month, one of the people said.

Read more

Like this post?
Donate bitcoins: 35DBUbbAQHTqbDaAc5mAaN6BqwA2AxuE7G


Follow me on Twitter.

Crony Congress – Rep. Mike Rogers Has Links to the Benghazi Scandal Yet is in Charge of the Investigation

by

For those of you who don’t know Congressman Mike Rogers, he is the Representative hailing from Michigan’s Eighth District. He is also one of the biggest blowhard, chicken-hawk defenders of unconstitutional NSA spying in all of Washington D.C.

Back in 2012, he gave his support to internet spy bill CISPA by proclaiming: “Stand for America! Support this bill!” Naturally, this clown would also serve as Chairman of the House Intelligence Committee.

Rogers is notorious for being one of the staunchest critics of Glenn Greenwald. For example, earlier this year he made up all sort of lies about Greenwald in an attempt to smear the journalist. In response, Greenwald had the following to say about Rogers back in February:

“First is that he’s not only lying, and he is lying, but he not only is lying but he knows that he’s lying. This what is Mike Rogers is notorious for in Washington is literally making things up and smearing political opponents and journalists he doesn’t like.

I defy Mike Rogers, if he wants to make that accusation, to come forward and present actual evidence that any journalist has stolen, has sold documents or stolen material or engaged in any kind of criminality. He has no evidence, he’s just making things up.”

You’d think a guy like Rogers who aggressively lobs untrue accusations against a journalist trying to inform the American public about government criminality would have a squeaky clean background himself. After all, he was a former FBI agent. You’d think that, but you’d be wrong.

Incredibly, Dick Morris points out that until recently Mike Rogers’ wife was the president and the CEO of the company that was contracted by the State Department to provide intelligence-based and physical security services. While this sort of crony capitalism is seen as “business as usual” in the cesspool that is D.C., the really crazy part of this story is that as Chairman of the House Intelligence Committee, Rogers is charged with investigating the adequacy of security at the Benghazi compound prior to the September 11, 2012 terrorist attack.

You can’t find a bigger conflict of interest than that…

Dick Morris writes:

Congressman Mike Rogers (R-Mich.), as Chairman of the House Intelligence Committee, is charged with investigating the adequacy of security at the Benghazi compound prior to the September 11, 2012 terrorist attack.

His wife, Kristi Clemens Rogers was the president and the CEO of the company that was contracted by the State Department to provide that security!

Mrs. Rogers, until recently, served as president and CEO of Aegis LLC, the contractor to the United States Department of State for intelligence-based and physical security services.

Aegis, a British private military company with overseas offices in Afghanistan, Bahrain, Iraq, Kenya, Nepal and the U.S., won a $10 billion, 5-year contract with the State Department to provide security for U.S. diplomatic posts around the world.

Read more

Like this post?
Donate bitcoins: 35DBUbbAQHTqbDaAc5mAaN6BqwA2AxuE7G


Follow me on Twitter.

An Iowa City with a Population of 7,000 Will Receive Armored Military Vehicle

by

I’ve covered the militarization of the domestic police force on several occasions on this website. For those of you who need a refresher, I suggest reading the following:

There are Over 50,000 SWAT Team Raids Annually in America

Retired Marine Colonel to New Hampshire City Council: “We’re Building a Domestic Army”

Video of the Day – Thuggish Militarized Police Terrorize and SWAT Team Iowa Family.

Moving along to the subject of today’s absurdity, the tiny city of Washington, Iowa with a population of 7,000 and 11 police officers, will be receiving a Mine Resistant Ambush Protected (MRAP) vehicle. Yes, they will be employing one of these in the field:

MRAP

These things normally cost $500,000, but will be given to Washington, Iowa for free under a Defense Department program that gives surplus military equipment to domestic law enforcement.

Matthew Byrd writes in the Daily Iowan that:

Sometimes the news is just so drearily awful that you have to sit back and almost appreciate the pure comedy induced by it.

Take this item from Washington, Iowa, where the local police have recently acquired an MRAP vehicle (short for Mine Resistance Ambush Protected) through a Defense Department program that donates excess vehicles originally produced for the wars in Iraq and Afghanistan to local police departments across the United States, including other Iowa towns such as Mason City and Storm Lake.

The MRAP weighs an impressive 49,000 pounds, stands 10-feet tall, and possesses a whopping six-wheel drive. Originally designed to resist landmines and IEDs, it sure seems like the MRAP will come in handy for the notorious war zone otherwise known as Washington County, Iowa.

Read more

Like this post?
Donate bitcoins: 35DBUbbAQHTqbDaAc5mAaN6BqwA2AxuE7G


Follow me on Twitter.

Are Tensions About to Flare Up Between the U.S., Iran and Russia Over Oil Barter Deal?

by

While people remain focused on Russia’s annexation of Crimea and fears that Putin may make aggressive moves in eastern Ukraine, it may be a barter deal between Russia and Iran for oil that takes tensions between the U.S. and Russia to a whole other level.

For example The Washington Post reports that:

As Russia seems poised to extend its land grab into eastern Ukraine, Vladimir Putin is also edging toward a deal with Iran that would make a mockery of the P5+1 interim agreement with Iran. News reports confirm that ”Russia could exchange non-monetary goods for up to 500,000 barrels of Iranian petroleum each day under the possible arrangement, which may ultimately pave the way for as much as $20 billion in trade, insiders told [Reuters] for a Wednesday report.” Mark Dubowitz of the Foundation for the Defense of Democracies, a sanctions guru, is quoted as saying, “If Washington can’t stop this deal, it could serve as a signal to other countries that the United States won’t risk major diplomatic disputes at the expense of the sanctions regime.” Even the State Department acknowledges that the deal would violate the interim deal.

Read more

Like this post?
Donate bitcoins: 35DBUbbAQHTqbDaAc5mAaN6BqwA2AxuE7G


Follow me on Twitter.

Video of the Day – Famed Venture Capitalist Discusses How Decentralization is the Current Mega Trend

by

Decentralization is a trend I have discussed on many, many occasions in the past. My personal attraction toward the movement comes from a political and social perspective, rather than merely an appreciation of its economic implications. My most recent piece on the subject highlighted the importance of worker owned co-ops. If you missed it the … Read more

Bitcoin for Rent – Real Estate Transaction Completed in NYC’s NoLita Neighborhood for BTC

by

I’m currently at the Javits Convention Center in New York City attending the Inside Bitcoins Conference. In keeping with the spirt of the day, I want to highlight this story of a NYC resident who just completed a real estate rental transaction entirely in Bitcoin.

While I previously highlighted the fact that Alvic Property Management in NYC had announced it would accept BTC, this is the first instance I can recall of someone paying rent, security deposit and a broker fee all in Bitcoin. The total was $18,000.

From Crain’s:

The head of a bitcoin-friendly real estate firm based in SoHo late last month completed what it is billing as the first real estate transaction in the country to fully use the virtual currency.

Nick Spanos, founder of Bitcoin Center NYC, an advocacy organization that promotes the use of the currency, who also happens to be the head of real estate brokerage Bapple, said that on March 24 a tenant paid in rent and deposit to a unnamed landlord in NoLita and commission to the brokerage for a total of nearly $18,000. The lease began on April 1.

Read more

Like this post?
Donate bitcoins: 35DBUbbAQHTqbDaAc5mAaN6BqwA2AxuE7G


Follow me on Twitter.

Zillow Study Shows 1 in 3 Homes are Unaffordable, Meanwhile Vacation Home Sales Soar

by

In a further demonstration of the socially destructive and ever widening gap between the haves and have nots, we see that the affluent are buying second homes at an ever increasing clip (up 30% last year), while first home buyers recede into the abyss as private equity and Chinese buyers make purchasing a home unaffordable for the average American.

Specifically, a recent study from Zillow showed that more than half the homes in seven major American cities are unaffordable based on historical standards. Those cities are: Miami, Los Angeles, San Diego, San Francisco, Denver, San Jose and Portland, Ore. Nationwide, it found that 1 in 3 homes were unaffordable. The results seem to back up housing analyst Mark Hanson’s recent conclusion that despite low interest rates, housing is even less affordable than the most bubbly year ever, 2006.

This also appears to be a primary reason behind Zillow now actively pitching its U.S. real estate listing to the Chinese, many of whom are corrupt and looking to launder ill gotten gains.

First, from Housing Wire:

More than half the homes currently on the market in seven major American metros are currently unaffordable for local residents, and one-third of homes for sale are unaffordable by historic standards.

That’s the conclusion from a Zillow analysis of income, mortgage and home value data in the fourth quarter of 2013, which puts to question the regular industry claim that housing is more affordable than ever because of the current price and interest rate levels coming out of the housing crash.

“As affordability worsens, we’re already beginning to see more of the kinds of worrisome trends we saw en masse during the years leading up to the housing crash. These include a greater reliance on non-traditional home financing, smaller down payments and a greater pressure to move further away from urban job centers in order to find affordable housing options,” said Zillow chief economist Stan Humphries. “We’re not in a bubble yet, but we’re beginning to see the early signs of one in some areas.”

Zillow calculated affordability by analyzing the current percentage of an area’s median income needed to afford the monthly mortgage payment on a median-priced home, and comparing it to the share of income needed to afford a median-priced home in the pre-bubble years between 1985 and 2000.

More than half of homes currently listed for sale in Miami (62.4%), Los Angeles (57.2%), San Diego (55.3%), San Francisco (55.2%), Denver (52.8%), San Jose (50.9%) and Portland, Ore. (50.3%) are unaffordable by historical standards.

Nationally, Zillow found that one-third of homes are currently unaffordable, and in many metro areas, the majority of homes remain more affordable now than they have been historically for buyers making the area’s median income.

Moving along, trite concerns such as housing affordability don’t impact the increasingly small group of people who do have considerable financial resources. For these folks, things have never been better, and they are splurging on second and third homes at an increasingly brisk pace. Don’t forget to send that Christmas card to Benny Bernanke.

For instance, from the Wall Street Journal we find that:

Sales of vacation homes are surging again, the result of rising wealth in higher-income households and renewed confidence in the housing market.

The number of second homes acquired for part-time personal use jumped 30% last year to 717,000 homes, according to an annual survey by the National Association of Realtors. The gain was the largest since the association started tracking second-home sales in 2003.

Read more

Like this post?
Donate bitcoins: 35DBUbbAQHTqbDaAc5mAaN6BqwA2AxuE7G


Follow me on Twitter.

Conspiracy Fact – How the U.S. Government Covertly Invented a “Cuban Twitter” to Create Revolution

by

It appears the U.S. government is doing its best to ensure that nobody anywhere in any corner of planet earth will ever trust American technology again (or U.S. aid for that matter). This process of distrust first really got going with the Edward Snowden revelations, which demonstrated that essentially all major U.S. tech firms are mere wards of the state with little to no privacy protections, and absolutely zero backbone.

This story of the U.S. government covertly creating a “Cuban Twitter” called ZunZuneo in order to overthrow the regime there has enormous long-term ramifications on many, many levels, which I will address throughout this post.

From the AP via The Washington Post:

WASHINGTON — In July 2010, Joe McSpedon, a U.S. government official, flew to Barcelona to put the final touches on a secret plan to build a social media project aimed at undermining Cuba’s communist government.

McSpedon and his team of high-tech contractors had come in from Costa Rica and Nicaragua, Washington and Denver. Their mission: to launch a messaging network that could reach hundreds of thousands of Cubans. To hide the network from the Cuban government, they would set up a byzantine system of front companies using a Cayman Islands bank account, and recruit unsuspecting executives who would not be told of the company’s ties to the U.S. government.

McSpedon didn’t work for the CIA. This was a program paid for and run by the U.S. Agency for International Development, best known for overseeing billions of dollars in U.S. humanitarian aid.

Now we can pretty much guarantee that foreign nations will forever be skeptical of any U.S. “aid”. Great work morons.

Documents show the U.S. government planned to build a subscriber base through “non-controversial content”: news messages on soccer, music, and hurricane updates. Later when the network reached a critical mass of subscribers, perhaps hundreds of thousands, operators would introduce political content aimed at inspiring Cubans to organize “smart mobs” — mass gatherings called at a moment’s notice that might trigger a Cuban Spring, or, as one USAID document put it, “renegotiate the balance of power between the state and society.”

At its peak, the project drew in more than 40,000 Cubans to share news and exchange opinions. But its subscribers were never aware it was created by the U.S. government, or that American contractors were gathering their private data in the hope that it might be used for political purposes.

“There will be absolutely no mention of United States government involvement,” according to a 2010 memo from Mobile Accord, one of the project’s contractors. “This is absolutely crucial for the long-term success of the service and to ensure the success of the Mission.”

The program’s legality is unclear: U.S. law requires that any covert action by a federal agency must have a presidential authorization. Officials at USAID would not say who had approved the program or whether the White House was aware of it. McSpedon, the most senior official named in the documents obtained by the AP, is a mid-level manager who declined to comment.

“The program’s legality is unclear”, as if that matters!

Read more

Like this post?
Donate bitcoins: 35DBUbbAQHTqbDaAc5mAaN6BqwA2AxuE7G


Follow me on Twitter.

Zillow Opens the Floodgates to Chinese Buyers in Order to Keep Housing Bubble 2.0 Inflated

by

Earlier this week, Michael Snyder made quite a splash in the alternative media world with his article: The Chinese Are Acquiring Large Chunks Of Land In Communities All Over America. Meanwhile, just last year I covered how corrupt Chinese are laundering their money through U.S. real estate in my post: Corrupt Chinese Politicians are Buying Billions in … Read more

Reverse Mortgages Spike 20% in 2013 as Baby Boomers Scramble for Cash

by

So what exactly is a reverse mortgage?

In a nutshell, it’s a specific type of home equity loan available only to people aged 62 and over, which has the added benefit of not carrying any interest payments and is only due upon death or once the homeowner is no longer using it as a primary residence. As you can see, this might be viewed as an attractive cash flow option for older Americans who didn’t save for retirement. That could be a lot of people, considering that Fidelity estimates 48% of baby boomers have not put away enough to retire.

While I have covered the various ways in which Americans are scraping by in the current feudal economy, from food stamps and disability fraud, to student loans and living in mom and pop’s basement, this reverse mortgage thing is a piece of the puzzle I have been missing.

These mortgages are not insignificant either. According to Inside Mortgage Finance, originations were up 20% in 2013, hitting $15.3 billion. So when you see that older guy working the cashier at Wal-Mart and wonder to yourself how he is surviving, the answer may increasingly be a reverse mortgage.

Oh, and since the FHA is originating many of these loans, you the taxpayer will be on the hook!

Let’s start out with some excerpts from the U.S. Department of Housing and Urban Development’s post: Frequently Asked Questions about HUD’s Reverse Mortgages.

The Home Equity Conversion Mortgage (HECM) is FHA’s reverse mortgage program, which enables you to withdraw some of the equity in your home.  The HECM is a safe plan that can give older Americans greater financial security. Many seniors use it to supplement Social Security, meet unexpected medical expenses, make home improvements and more.

1. What is a reverse mortgage?

A reverse mortgage is a special type of home loan that lets you convert a portion of the equity in your home into cash. The equity that you built up over years of making mortgage payments can be paid to you.  However, unlike a traditional home equity loan or second mortgage, HECM borrowers do not have to repay the HECM loan until the borrowers no longer use the home as their principal residence or fail to meet the obligations of the mortgage.  You can also use a HECM to purchase a primary residence if you are able to use cash on hand to pay the difference between the HECM proceeds and the sales price plus closing costs for the property you are purchasing.

5. What are the differences between a reverse mortgage and a home equity loan?

With a second mortgage, or a home equity line of credit, borrowers must make monthly payments on the principal and interest.  A reverse mortgage is different, because it pays you – there are no monthly principal and interest payments.  With a reverse mortgage, you are required to pay real estate taxes, utilities, and hazard and flood insurance premiums.

See there really is a magic money tree. Thanks FHA!

6. Will we have an estate that we can leave to heirs?

When the home is sold or no longer used as a primary residence, the cash, interest, and other HECM finance charges must be repaid.  All proceeds beyond the amount owed belong to your spouse or estate.  This means any remaining equity can be transferred to heirs.  No debt is passed along to the estate or heirs.

Moving along, we learn from the New York Post that:

Cash-strapped baby boomers, taking the TV advice of the Fonz and former US Sen. Fred Thompson, have opted for reverse mortgages in increasing numbers.

Inside Mortgage Finance, a trade publication covering the housing industry, said borrowers took out some $15.3 billion of these loans last year, an increase of 20 percent over 2012.

Reverse mortgages, which let homeowners age 62 and up borrow money against the value of their homes, have become a popular way for boomers without significant assets to fund retirement.

Is this something you’d expect to see five years into a genuine economic recovery, or it is a reaction to a ponzi consumption based economy plagued with zero income growth?

Read more

Like this post?
Donate bitcoins: 35DBUbbAQHTqbDaAc5mAaN6BqwA2AxuE7G


Follow me on Twitter.