Government corruption: The real public school crime wave

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Watching these clips you can begin to understand why 47% of Detroiters do not pay their taxes - poor, or no services we don't pay you. Parents leave their children to swim in this toxic educational swill because their own generation was washed through the same brain flush of values and Americanism.

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The real public school crime wave Principals, administrators, board members
 
Rampant, pervasive, institutionalized
This clip from the documentary film "The Cartel," by Bob Bowdon, discusses the corruption occurring in some of New Jersey's Public Schools.

For more information, visit the film's website:

http://www.TheCartelMovie.com



For more Government corruption: videos, click here
Government corruption: The real public school crime wave

Eric Sprott: Is the West Dishoarding Its Sovereign Treasure? *podcast*

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PodcastAnd if so, what will happen once it's done? by Adam TaggartSaturday, February 23, 2013, 9:10 AM

We are well into the financial crisis. Everyone’s trying to keep it together, even though it would appear from the reading of the economy things are not going well at all here. And everyone's ignoring things.

But I think, in their hearts, the Central Bankers must know what they’re doing is totally irresponsible. And the tell of that irresponsibility – which is the debasing of the currencies – is the fact that real things will go up in value. This should be reflected in the price of gold and silver.

So expresses Eric Sprott, CEO and founder of Sprott Asset Management, and one of the most experienced and vocal advocates for owning precious metals.

The past decade has validated Eric's thesis, as gold has risen considerably against all world fiat currencies. But what vexes him is that in recent years, when currency debasement has accelerated to extreme levels, precious metals prices have been clearly suppressed, particularly versus the U.S. dollar.

As the topic of price manipulation is nothing new, Eric finds his focus increasingly drawn to where the precious metals are going at these bargain prices - who is accumulating and who is dishoarding:

I’ve done a lot of work on the flow of metals. I come up with a net change of 2,300 tons a year in new buying in gold when the supply of gold hasn’t even gone up in the last twelve years. And you keep wondering: Well, where’s all this gold coming from?

His findings support the growing meme that there is a massive bullion transfer from West to East. This should particularly concern those in the U.S., EU and Canada as his suspicion is that, increasingly, it's monetary gold that is being sold.

There are several key questions to ask here (not that the data publicly exists to answer them):

• How much of our sovereign monetary bullion reserves have been sold to date?
• How much will be sold in the future? (Are we willing to sell all of it? or is there a limit we refuse to let go of?)
• What will happen to the price of gold & silver when central banks stop selling to another? (Answer: shoot the moon)
• What will be the fate of those economies that dishorded their treasure? (Answer: lamentable)

When I see China buying 95 tons of gold in December and I read that India bought 100 tons in the month of January, when we all collectively know there’s only about 200 tons a month available –  you have to conclude that G6 Central Banks continue to sell their gold in a very non-transparent fashion.

One of the things we saw in December was that the U.S. Department of Commerce reported that U.S. exports of gold were $4 billion. We exported 2.5 million ounces of gold. And where it comes from, [only] God knows; the country only produces 8.8 million a nd most of that’s used internally. So I don’t know how you just come up with 2.5 million ounces that you’re able to export. So I believe that even though it’s described as non-monetary gold, my guess is that it is monetary gold.

There’s lots afoot here in central banking to try to keep it organized. And I think one of those things is to keep the price suppressed.

But the non-G6 nations have been huge buyers of gold, and I think the more anybody looks at the system from outside looking in, they realize they have to have gold and silver, notwithstanding the nonsense that goes on in COMEX and the LBMA (London Bullion Market Association).

When I got involved in the gold market, it was assumed that the central banks had something like 36,000 tons of gold. And there was a great study done by Frank Veneroso where he suggests 18,000 those tons didn’t even exist anymore.
The [global] central banks are sellers of 400 tons in an overt fashion. Now we see buying of over 500 tons. That, just in itself, is a 900-ton change in a 4000-ton market, if I’m including recyclables here. And yet there’s been no increase in supply.

So I have to assume that these central banks are running low, and the question in my mind is, do they just go down to zero and then give up?

Or do they look in the cupboards one day and say look, this is just not going to work because the intensity of buying by people, like China in particular, has just gone absolutely bonkers. And it looks like India, notwithstanding putting a surtax or excise tax on gold, the demand seems to be very firm. And as you mentioned, mint sales have been amazingly strong here.

So I think there’s enough element of the world who get it that the pressure’s going to continue to be on the price of gold going higher. And yes, there’s nothing we can do in terms of what’s going on in the COMEX and the LBMA, but we keep seeing more and more people asking for delivery, even in the COMEX. So I think that the day can’t be far off. We can’t predict when it’s going to be, but the natural stage should be that the price of gold is going up, and we’re in such a tremendous financial crisis that it hasn’t been allowed to manifest itself because they’re putting out fires all the time.

For precious metals holders licking their wounds from the carnage of the past several months, this podcast offers both new insights and sound reminders of the long-term reasons for owning gold and silver. Those on the sidellines considering entering into the precious metals, perhaps for the first time, should consider reading our guide to Buying Gold & Silver after listening to this podcast.

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Trading the Fear & Greed Gold Price Parameters

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Determining the ups 'n downs of the precious metals has been an adventure to nowhere for all of us. Understanding the algorithms of the banksters has been a futile exercise without a whistleblower. We know they concentrate their heavy paper trade dumps between 7AM -11AM when the LBMA is active. Certainly no one dumps 50,000+ contracts at the slowest time of the daily trading in hopes of a profit! Physical spot prices are derived from paper trading, this we know. There will always be speculators, independents and hedgers in there. In a normal free market trading without manipulation and price suppressions that would be wonderful. But, that's not the way it is.

So, let's take a glimpse of the extreme divergences of the Gold price from its WEEKLY 50-week Mov. Avg. Quite simple actually; a chart a neophyte can comprehend.

The "Fear" (capitulation) extreme was in late 2008 when gold's price went 17% below its 50wma.  Gold had never dipped below its WMA since that occasion...ever. I suppose a technician could draw a support line beneath -1%, -6%, and -5%. But, that's not the intention of this presentation. The "Greed" (enthusiasm) peaks have been 28%, 11% and 7% since 2011.

We have tried to represent the emotional reactions of buyers/sellers in graphic form as to what human actions may be in the crystal ball for the future.

We don't know. But factor in all your fundamentals along with more paper confetti money from the Fed, and go from there.

Naturally, where gold goeth, silver followeth.
click image for larger view You are free to create your own free charts from Netdania.

E-Mails Show Criminal Flaws in JPMorgan’s Mortgage Securities

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By JESSICA SILVER-GREENBERG 

The bank is being sued over
mortgage-backed deals.
Jamie Dimon, JPMorgan’s
chief.

When an outside analysis uncovered serious flaws with thousands of home loans, JPMorgan Chase executives found an easy fix.

Rather than disclosing the full extent of problems like fraudulent home appraisals and overextended borrowers, the bank adjusted the critical reviews, according to documents filed early Tuesday in federal court in Manhattan. As a result, the mortgages, which JPMorgan bundled into complex securities, appeared healthier, making the deals more appealing to investors.

The trove of internal e-mails and employee interviews, filed as part of a lawsuit by one of the investors in the securities, offers a fresh glimpse into Wall Street’s mortgage machine, which churned out billions of dollars of securities that later imploded. The documents reveal that JPMorgan, as well as two firms the bank acquired during the credit crisis, Washington Mutual and Bear Stearns, flouted quality controls and ignored problems, sometimes hiding them entirely, in a quest for profit.

The lawsuit, which was filed by Dexia, a Belgian-French bank, is being closely watched on Wall Street. After suffering significant losses, Dexia sued JPMorgan and its affiliates in 2012, claiming it had been duped into buying $1.6 billion of troubled mortgage-backed securities.

The latest documents could provide a window into a $200 billion case that looms over the entire industry. In that lawsuit, the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac, has accused 17 banks of selling dubious mortgage securities to the two housing giants. At least 20 of the securities are also highlighted in the Dexia case, according to an analysis of court records.

In court filings, JPMorgan has strongly denied wrongdoing and is contesting both cases in federal court. The bank declined to comment.

Dexia’s lawsuit is part of a broad assault on Wall Street for its role in the 2008 financial crisis, as prosecutors, regulators and private investors take aim at mortgage-related securities. New York’s attorney general, Eric T. Schneiderman, sued JPMorgan last year over investments created by Bear Stearns between 2005 and 2007.

Jamie Dimon, JPMorgan’s chief executive, has criticized prosecutors for attacking JPMorgan because of what Bear Stearns did. Speaking at the Council on Foreign Relations in October, Mr. Dimon said the bank did the federal government “a favor” by rescuing the flailing firm in 2008.

The legal onslaught has been costly. In November, JPMorgan, the nation’s largest bank, agreed to pay $296.9 million to settle claims by the Securities and Exchange Commission that Bear Stearns had misled mortgage investors by hiding some delinquent loans. JPMorgan did not admit or deny wrongdoing.

“The true price tag for the ongoing costs of the litigation is terrifying,” said Christopher Whalen, managing director at Carrington Investment Services.

The Dexia lawsuit centers on complex securities created by JPMorgan, Bear Stearns and Washington Mutual during the housing boom. As profits soared, the Wall Street firms scrambled to pump out more investments, even as questions emerged about their quality.

With a seemingly insatiable appetite, JPMorgan scooped up mortgages from lenders with troubled records, according to the court documents. In an internal “due diligence scorecard,” JPMorgan ranked large mortgage originators, assigning Washington Mutual and American Home Mortgage the lowest grade of “poor” for their documentation, the court filings show.

The loans were quickly sold to investors. Describing the investment assembly line, an executive at Bear Stearns told employees “we are a moving company not a storage company,” according to the court documents.

As they raced to produce mortgage-backed securities, Washington Mutual and Bear Stearns also scaled back their quality controls, the documents indicate.

In an initiative called Project Scarlett, Washington Mutual slashed its due diligence staff by 25 percent as part of an effort to bolster profit. Such steps “tore the heart out” of quality controls, according to a November 2007 e-mail from a Washington Mutual executive. Executives who pushed back endured “harassment” when they tried to “keep our discipline and controls in place,” the e-mail said.

Even when flaws were flagged, JPMorgan and the other firms sometimes overlooked the warnings.

JPMorgan routinely hired Clayton Holdings and other third-party firms to examine home loans before they were packed into investments. Combing through the mortgages, the firms searched for problems like borrowers who had vastly overstated their incomes or appraisals that inflated property values.

According to the court documents, an analysis for JPMorgan in September 2006 found that “nearly half of the sample pool” — or 214 loans — were “defective,” meaning they did not meet the underwriting standards. The borrowers’ incomes, the firms found, were dangerously low relative to the size of their mortgages. Another troubling report in 2006 discovered that thousands of borrowers had already fallen behind on their payments.

But JPMorgan at times dismissed the critical assessments or altered them, the documents show. Certain JPMorgan employees, including the bankers who assembled the mortgages and the due diligence managers, had the power to ignore or veto bad reviews.

In some instances, JPMorgan executives reduced the number of loans considered delinquent, the documents show. In others, the executives altered the assessments so that a smaller number of loans were considered “defective.”

In a 2007 e-mail, titled “Banking overrides,” a JPMorgan due diligence manager asks a banker: “How do you want to handle these loans?” At times, they whitewashed the findings, the documents indicate. In 2006, for example, a review of mortgages found that at least 1,154 loans were more than 30 days delinquent. The offering documents sent to investors showed only 25 loans as delinquent.

A person familiar with the bank’s portfolios said JPMorgan had reviewed the loans separately and determined that the number of delinquent loans was far less than the outside analysis had found.
Continue reading...

Poland Still Fearful of JP Morgan's Wrath which it Accuses of Manipulating Poland's Equity Markets

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Posted by Charleston Voice again on 05.21.12  "        "            "              "             "           08.14.12
 "        "            "              "             "            11.27.12
 "        "            "              "             "            02.25.13

After nearly four years we have seen no subsequent stories, follow-ups, or resolution to this story - - anyone have any info? Where are the financial journalist sleuths to sniff out the truth?
The government is investigating JP Morgan's activities in Poland

1st December 2008


Economy Minister Waldemar Pawlak has announced that the government will investigate financial services firm JP Morgan's activities in Poland, and will ask the US authorities for an explanation.

Concerns emerged in late November when the Polish Financial Supervision Authority (KNF) stated that it had reason to suspect that JP Morgan had been involved in manipulation of the blue-chip WIG20 index on November 12. That session ended in a 9.1 percent loss for the index. The KNF has contacted the Prosecutor's Office.

Waldemar Pawlak, Deputy Prime Minister, Minister of Economy, Poland

The loss resulted from a series of buy orders placed shortly before the close of trade, which pushed the WIG20 up five percent, and the KNF claims the orders came from JP Morgan Securities Limited in Great Britain. The buy orders, worth zł.130 million, were made for the stock of all 20 companies on the blue-chip index.

"The accusations presented by the KNF are serious. This looks like manipulation. It is good that the KNF has handled this issue so well," said Wiesław Rozlucki, a former president of the WSE toldRzeczpospolita.

This is not the first time JP Morgan has courted controversy in Poland. Earlier this autumn it issued a report which claimed that Poland's economy was in worse shape than Hungary's. "In the case of a crisis [the Polish economy] would be left almost with no reserves," the report stated.

In October, the firm also lowered its GDP growth predictions for Central and Eastern Europe, with Poland's 2009 growth estimated at 1.5 percent, half of what has been forecast by the National Bank of Poland and the EC.

JP Morgan's activities have aroused suspicion but Rozłucki did not think all these issues were connected. "I do not suspect any plot by JP Morgan. I reject suggestions that this could be a coordinated action," he said.

As WBJ went to press, JP Morgan was still working on an official statement on this matter and was thus unable to comment.

From Warsaw Business Journal 

story source 

The Feds Want Your Retirement Accounts & Plans to Take Them

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Bankers need your money more than you do. It's the patriotic thing to do.

February 22, 2013

The Feds Want Your Retirement Accounts

By John White

Quietly, behind the scenes, the groundwork is being laid for federal government confiscation of tax-deferred retirement accounts such as IRAs. Slowly, the cat is being let out of the bag.

 

Last January 18th, in a little noticed interview of Richard Cordray, acting head of the Consumer Financial Protection Bureau, Bloomberg reported "[t]he U.S. Consumer Financial Protection Bureau [CFPB] is weighing whether it should take on a role in helping Americans manage the $19.4 trillion they have put into retirement savings, a move that would be the agency's first foray into consumer investments."  That thought generates some skepticism, as aptly expressed by the Richard Terrell cartoon  published by American Thinker.

 

Days later On January 24th President Obama renominated Cordray as CFPB director even though his recess appointment was not due to expire until the end of 2013.

 

One day later, in the first significant resistance to President Obama's concentration of presidential power, a three judge panel of the U.S. Court of Appeals in Washington DC unanimously said that Obama's Recess Appointments to the National Labor Relations Board are unconstitutional.  Similar litigation testing the Cordray appointment to the CFPB is in the pipeline.

 

The Consumer Financial Protection Bureau (CFPB) created by the 2,319 page Dodd-Frank legislation is a new and little known bureau with wide-ranging powers.  

 

Placed within the Federal Reserve, a corporation privately owned by member banks, the CFPB is insulated from oversight by either the President or Congress, its budget not subject to legislative control.  It is not even clear that a new President can replace the CFPB director on taking office.

 

Unusual legal and political environments have a significant impact on the CFPB. With Cordray's recess appointment in doubt several questions remain unanswered. 

 

1) What will become of the CFPB when Cordray's appointment is found invalid?  An indicator comes from the NRLB, which operated unconstitutionally for years without a quorum.  In 2007 the Senate threatened no NLRB nominations reported out of committee.

 

The NLRB continued operating with two members.  Then a Supreme Court ruling in June of 2010 invalidated the NLRB decisions for lack of a quorum.  Fisher & Phillips give the details about what was done next.

But recovery from the Supreme Court's sting was quick, with Liebman and Schaumber still on the Board and with two new Members confirmed, ... the suddenly full-strength Board simply added a new Member to the "rump panel" of the original decisions and managed to rubber-stamp many of the disputed Orders - at a record-setting pace - with the same result...

This may explain why President Obama renominated Cordray a year early.  Once confirmed Cordray can rubber-stamp decisions made while he was unconstitutionally appointed.  Otherwise those decisions will be invalidated.

 

2) What will the CFPB do with your money?  The CFPB incursion into individual personal savings, in order to control how you invest your money, isn't a new idea. Current proposals grew from a policy analysis as disclosed by Roger Hedgecock.

On Nov. 20, 2007, Theresa Ghilarducci, professor of economic policy analysis at the New School for Social Research in New York, presented a paper proposing that the feds eliminate the tax deferral for private retirement accounts, confiscate the balance of those accounts, give each worker a $600 annual "contribution," assess a mandatory savings tax on every worker and guarantee a 3 percent rate of return on the newly titled "Guaranteed Retirement Accounts," or GRAs.

How would that be accomplished?  The Carolina Journal reported Ghilarducci's 2008 testimony to Nancy Pelosi's House.

Democrats in the U.S. House have been conducting hearings on proposals to confiscate workers' personal retirement accounts "including 401(k)s and IRAs" and convert them to accounts managed by the Social Security Administration.

Your Government universal GRA investment savings account is an annuity managed by Social Security.  Hedgecock noted '[m]ake no mistake here: Obama is after your retirement money. The "annuities" will "invest" not in the familiar packages of bond and stock mutual funds but in the Treasury debt!' 

By 2010 Bloomberg published an article titled  "US Government Takes Two More Steps Toward Nationalization of Private Retirement Account Assets." In that article Patrick Heller observed that, with Democrat control of Congress and the Presidency:

[I]n mid-September 2010 the Departments of Labor and Treasury held hearings on the next step toward achieving Ghilarducci's goals. The stated purpose was to require all private plans to offer retirees an option to elect an annuity. The "behind-the-scenes" purpose for this step was to get people used to the idea that the retirement assets they had accumulated would no longer be part of their estate when they died.

So the Government would get the money, not the estate or family of the people who saved the money during a lifetime of work.  That's a one hundred percent death tax on savings.  Worse, the most responsible and poorest families will be penalized.

 

Democrats had a blueprint for diverting people's savings from private investment to government debt.  Then in 2010 the Tea Party won the house...

 

3) Why should the Government intervene in people's savings decisions?  The justifications for Government intervention in private financial decisions are varied.  Panic over the economy, Wall Street, mandating savings equity, eliminating investment risk, financial crisis losses, retirement security, much-needed oversight, your 401K becomes a 201K, shoddy financial products, and predatory investment bankers are just a few. 

If the financial industry is so predatory, how is it possible that savers keep any money?  More importantly, we have all those government agencies, FDIC, FINRA, SEC, Labor Department, Treasury Department, NCUA, Office of Thrift Supervision, FHFA, NCUSIF, Comptroller of the Currency, Office of Foreign Assets Control, Pension Benefit Guaranty Corporation, hundreds of criminal penalties, and state level regulators.  Are we admitting the Government is incapable of policing criminal and predatory behavior?  Do we have invincible predators plundering the people, or do politicians Cry Wolf?

 

And about that crisis in the economy.  Former Congressman Barney Frank, one of the authors of Dodd-Frank, admitted to Larry Kudlow that Government was to blame for the housing crisis.

 

Professor Ghilarducci said "humans often lack the foresight, discipline, and investing skills required to sustain a savings plan."  Professor Ghilarducci tells us that people are flawed, no argument there.

 

Her solution, substitute Government decisions for the judgment of the millions of people who actually earned and saved the money.  She fails to mention the government bureaucrats wielding the power to compel you to comply are themselves imperfect.  Which is preferable, one faulty Government solution or millions of individual free choices?

 

4) Are there other forces pushing Government to confiscate people's savings?  With $16 trillion in debt the short answer is yes.  When governments embark on a path of spending money they don't have, they resort to financial repression.  According to Wikipedia: 

Financial repression is any of the measures that governments employ to channel funds to themselves, that, in a deregulated market, would go elsewhere. Financial repression can be particularly effective at liquidating debt.

Do we have any evidence that the US Government is pursuing financial repression?  Yes we do. Jeff Cox at CNBC.  "US and European regulators are essentially forcing banks to buy up their own government's debt-a move that could end up making the debt crisis even worse, a Citigroup analysis says."

An Investors Business Daily article, Banks Pressured to Buy Government Debts, notes that "[b]anks can't say no. They fear the political fallout. So they meekly submit to the government's dictates."

Meanwhile the Wall Street Journal reports that "[i]n 2011, the Fed purchased a stunning 61% of Treasury issuance."  Then a CNS News article revealed that  "[s]o far this calendar year [2013], the Federal Reserve has bought up more U.S. government debt than the U.S. Treasury has issued."

5) Is the health of Social Security (SS) a factor? There are several potential measures of when Social Security retirement goes broke.  One measure is when FICA tax income doesn't cover the cost of retirement checks.  We have passed that point already.  Others say that SS is fine until the lock box runs out of special issue bonds (IOUs).

Even though the SS bonds in the lock box cannot be sold on the open market, the Treasury Department remains under political pressure to honor that obligation by borrowing real cash to redeem the IOUs.   At least until the IOUs in the lock box are gone.  How long is that?  Based on a credible source, Bruce Krasting at Zerohedge suggests not long...Continue reading...

You can see a clip from 2 years ago from Bob Chapman (since deceased) on the danger of leaving your retirement in a 401K, IRA. etc. Gets into the 401K at the 7min. mark.

http://www.youtube.com/watch?feature=player_embedded&v=E6zwrKr_vpg

127 corporations that want to "Fix the Debt" by gutting your retirement

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We're grateful for author Gaius bringing mention of this to the fore. However, the major component is absent - the adhesive, the Super-Glu binding these frauds together under a cloak of "public service" is Peter G. Peterson, one of the grand masters of the Conspiracy:  Chairman of the Council on Foreign Relations. We do not could him among America's greatest allies or patriots. Certainly no friend of individual liberty!

 

The Campaign to Fix the Debt is the latest incarnation of a decades-long effort by former Nixon man turned Wall Street billionaire Pete Peterson to slash earned benefit programs such as Social Security and Medicare under the guise of fixing the nation's "debt problem." Through this special report -- and in partnership with The Nation magazine -- the Center for Media and Democracy exposes the funding, the leaders, the partner groups, and phony state "chapters" of this $60 million "astroturf supergroup," whose goal is to achieve a grand bargain on austerity by July 4, 2013.^[1]

We urge you to see the beneficial interlocks that "Fix the Debt" has set up for their corporatist allies colluding with government at your expense. GO HERE

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127 corporations that want to “Fix the Debt” by gutting your retirement

2/23/2013 10:00am by Gaius Publius  The CEOs of the following corporations don’t think they have enough money — perhaps because they don’t have it all. So they got together a little group called “Fix the Debt” to cobble up some more. The source of their added wealth? Your government retirement and medical insurance programs. You know, Social Security and Medicare. ‘Cause all your money aren’t yet belong to them; you still have some left.

I wrote about Fix the Debt earlier, the truly bipartisan group that wants Obama to do what he also wants to do, reduce the safety net. The following is a list of corporations who are driven by their millionaire and billionaire CEOs to help him get ‘er done.

The source is the amazing group SourceWatch. Also amazing — the list itself. Take a gander:

A ACE Limited Advance America AES Aetna Air Products and Chemicals Alcoa Alliance for Business Leadership Allstate American International Group AmericanTowns.com Apollo Global Management Ashford Hospitality Trust Associated Partners AT&T Atlas Air Worldwide Holdings, Inc. B Bain Capital Bank of America Corp. Bank of New York Belk BlackRock Boeing Boston Capital Bridgestone Broadridge Financial Solutions C CA Technologies Caesars Entertainment Corporation Calix CapWealth Advisors LLC Carlyle Group Case New Holland Caterpillar CCMP Capital Cisco Inc. Citigroup Clayton, Dubilier & Rice Continental Grain Company Cooper Industries Corning Corporation Corporate Executive Board Co. Court Square Covington & Burling Cravath Swaine & Moore CSX

C cont. CVS Caremark D Daintree Delaware Street Capital Company Deloitte Touche Tohmatsu Delta Air Lines Deutsche Bank DIRECTV Discovery Communications Donnelley Dow Chemical Company Duke Energy E Eagle Capital Managment Earthlink Eaton Corporation EBay Eloqua, Inc. Entravision Communications Corporation F Fedbid Foot Locker, Inc. G General Electric Glover Park Group H Honeywell Humana I IAC/InterActiveCorp Interaction Associates Invesco, Ltd. Investment Technology Group J JetBlue John Deere JPMorgan Chase K Kelly Services Knight Capital Group L LinkedIn Loews Corp. M M&T Bank Macy’s Marriott Marsh & McLennan Companies McKinsey & Company Medco Merck Microsoft Morgan Stanley

M cont. Motorola N NASDAQ OMX Group Norfolk Southern NYSE Euronext P Partnership for New York City PricewaterhouseCoopers LLP ProLogis Providence Equity Partners LLC Q QUALCOMM R Ramsey Asset Management Reputation.com S Simpson-Bowles Commission SIRIUS Satellite Radio Stanley Black & Decker Staples Starwood Hotels State Farm SunGard Data Systems Inc. T T Rowe Price Tenneco Terex Corporation Textron The Duchossois Group, Inc. Thermo Fisher Scientific Three Oceans Partners Tishman Speyer TiVo U United Parcel Service UnitedHealth Group V VeriFone Verizon Communications Vornado Realty Trust W Weber Shandwick Welsh, Carson, Anderson and Stowe Weyerhaeuser Wheels, Inc. Willis Group Holdings WL Ross & Co., LLC World Fuel Services Wunderman Y Yahoo Inc.

See anyone you recognize, or patronize? Their CEO told me to tell you Thanks.
GP

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West Pours Arms into Syria as Al Qaeda Mass Slaughters Civilians

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West fueling deadly conflict that has allegedly killed 70,000. 

February 24, 2013 (LD) - Repeat a lie often enough, and hopefully people will begin to believe it. That is what a concerted effort by Western media houses hopes to achieve as they claim the recent flow of heavy weapons  from Western nations and their Arab-Israeli partners is boosting "moderate rebels" and "tilting" the balance of Syria's conflict against the Syrian government.

The Washington Post in particular, sets the tempo for this coordinated propaganda campaign, claiming in their report, "In Syria, new influx of weapons to rebels tilts the battle against Assad," that:

A surge of rebel advances in Syria is being fueled at least in part by an influx of heavy weaponry in a renewed effort by outside powers to arm moderates in the Free Syrian Army, according to Arab and rebel officials.

The report also states: 

The officials declined to identify the source of the newly provided weapons, but they noted that the countries most closely involved in supporting the rebels’ campaign to oust Assad have grown increasingly alarmed at the soaring influence of Islamists over the fragmented rebel movement. They include the United States and its major European allies, along with Turkey and the United Arab Emirates, and Saudi Arabia and Qatar, the two countries most directly involved in supplying the rebels. 

The Washington Post refuses to use the term, "Al Qaeda," and instead labels the international, Persian Gulf financed, armed, and harbored terror organization as, "radical Islamists." It quotes an unnamed Arab official as saying,: 

"If you want to weaken al-Nusra, you do it not by withholding [weapons] but by boosting the other groups."

Al Qaeda and the "Moderates" are One in the Same 

Al-Nusra, of course, is Al Qaeda in Syria and is linked directly to the openly Western-created and backed "moderate" opposition. Moaz al-Khatib, leader of the so-called National Coalition, demanded the US take al-Nusra in particular off their list of sanctioned terrorist organizations. In December of 2012, Reuters quoted al-Khatib as saying: 

"The decision to consider a party that is fighting the regime as a terrorist party needs to be reviewed. We might disagree with some parties and their ideas and their political and ideological vision. But we affirm that all the guns of the rebels are aimed at overthrowing the tyrannical criminal regime."

 In the same article, Reuters would admit: 

The United States designated the Jabhat al-Nusra (Nusra Front) as a foreign terrorist organisation and said it was trying to hijack the revolt on behalf of al Qaeda in Iraq. 

While the Washington Post tries to claim Al Qaeda is somehow a separate entity from the "Syrian opposition," the West's own opposition front openly defends and supports Al Qaeda's ongoing violence, which most recently manifested itself in a car bomb targeting scores of civilians, including school children.

As the West simultaneously accuses Saudi Arabia and Qatar (and here) of being the primary financiers of Al Qaeda, it itself has admitted years before the so-called "Syrian uprising" began that it was itself funding and arming extremist groups with direct ties to Al Qaeda with the goal of fostering the very violence now taking place in Syria and along its peripheries. The purpose of now repeatedly lying about arming only "moderate" militants in Syria, is to cover up both past admissions that the West planned to overthrow both Syria and neighboring Iran by arming and funding Al Qaeda since at least 2007, as well as obvious evidence that they are in fact doing just that in Syria now.

Image: (Left) The US Army West Point Combating Terrorism Center's 2007 report, "Al-Qa'ida's Foreign Fighters in Iraq" indicated which areas in Syria Al Qaeda fighters filtering into Iraq came from. The overwhelming majority of them came from Dayr Al-Zawr in Syria's southeast, Idlib in the north near the Turkish-Syrian border, and Dar'a (Daraa) in the south near the Jordanian-Syrian border. (Right) A map indicating the epicenters of violence in Syria indicate that the exact same hotbeds for Al Qaeda in 2007, now serve as the epicenters of so-called "pro-democracy fighters." The Washington Post now claims that arming militants near Dar'a (Daraa) will help keep weapons out of extremists' hands, despite the US Army long-ago identifying it as one of many Al Qaeda hotbeds.
....
US Admissions to Arming Al Qaeda in Syria as Early as 2007

In 2007, the Wall Street Journal published an article titled, "To Check Syria, U.S. Explores Bond With Muslim Brothers" which stated: 

On a humid afternoon in late May, about 100 supporters of Syria's largest exile opposition group, the National Salvation Front, gathered outside Damascus's embassy here to protest Syrian President Bashar Assad's rule. The participants shouted anti-Assad slogans and raised banners proclaiming: "Change the Regime Now."

Later in the article, it would be revealed that the National Salvation Front (NSF) was in contact with the US State Department and that a Washington-based consulting firm in fact assisted the NSF in organizing the rally:

In the weeks before the presidential election, the State Department's Middle East Partnership Initiative, which promotes regional democracy, and NSF members met to talk about publicizing Syria's lack of democracy and low voter turnout, participants say. A Washington-based consulting firm, C&O Resources Inc., assisted the NSF in its planning for the May 26 anti-Assad rally at the Syrian embassy, providing media and political contacts. State Department officials stress they provided no financial or technical support to the protestors.

The article then admits:

One of the NSF's most influential members is the Syrian branch of the Muslim Brotherhood -- the decades-old political movement active across the Middle East whose leaders have inspired the terrorist groups Hamas and al Qaeda. Its Syrian offshoot says it has renounced armed struggle in favor of democratic reform.

Also in 2007, reported by Pulitzer Prize-winning journalist Seymour Hersh in his New Yorker article, "The Redirection," it was stated (emphasis added):

"To undermine Iran, which is predominantly Shiite, the Bush Administration has decided, in effect, to reconfigure its priorities in the Middle East. In Lebanon, the Administration has coöperated with Saudi Arabia’s government, which is Sunni, in clandestine operations that are intended to weaken Hezbollah, the Shiite organization that is backed by Iran. The U.S. has also taken part in clandestine operations aimed at Iran and its ally Syria. A by-product of these activities has been the bolstering of Sunni extremist groups that espouse a militant vision of Islam and are hostile to America and sympathetic to Al Qaeda."

 Hersh's report would continue by stating: 

"the Saudi government, with Washington’s approval, would provide funds and logistical aid to weaken the government of President Bashir Assad, of Syria. The Israelis believe that putting such pressure on the Assad government will make it more conciliatory and open to negotiations." -The Redirection, Seymour Hersh (2007)

Further admissions of a joint US-Israeli-Saudi conspiracy against Syria included: 

"...[Saudi Arabia's] Bandar and other Saudis have assured the White House that “they will keep a very close eye on the religious fundamentalists. Their message to us was ‘We’ve created this movement, and we can control it.’ It’s not that we don’t want the Salafis to throw bombs; it’s who they throw them at—Hezbollah, Moqtada al-Sadr, Iran, and at the Syrians, if they continue to work with Hezbollah and Iran.” -The Redirection, Seymour Hersh (2007)

 In regards to sectarian extremism in particular it was forewarned that: 

"Robert Baer, a former longtime C.I.A. agent in Lebanon, has been a severe critic of Hezbollah and has warned of its links to Iranian-sponsored terrorism. But now, he told me, “we’ve got Sunni Arabs preparing for cataclysmic conflict, and we will need somebody to protect the Christians in Lebanon. It used to be the French and the United States who would do it, and now it’s going to be Nasrallah and the Shiites" -The Redirection, Seymour Hersh (2007)  

While the Western media now concedes that Al Qaeda is playing a primary role in Syria's violence, it not only is pretending as if open, and repeated admissions by US, Saudi, and Lebanese officials as far back as 2007 to organize and arm Al Qaeda in the first place never happened, it continuously attempts to frame Al Qaeda as being somehow separate, even opposed to "moderate rebels" - despite these "moderates" defending and embracing Al Qaeda's al-Nusra front by name.
Continue reading...

U.S. Air Force developing terrifying swarms of tiny unmanned drones that can hover, crawl and even kill targets *video*

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• Air Vehicles Directorate at Wright-Patterson Air Force Base in Dayton, Ohio, is already developing prototypes of tiny drones that can hover
• The Micro Air Vehicles will work in swarms to provide complex surveillance of a battlefield
• They can also be armed with incapacitating chemicals, combustible payloads or even explosives 'for precision targeting capability'

By Michael Zennie

PUBLISHED: UPDATED: 13:25 EST, 20 February 2013

The U.S. Air Force is developing tiny unmanned drones that will fly in swarms, hover like bees, crawl like spiders and even sneak up on unsuspecting targets and execute them with lethal precision. 

Video: The lethal micro-drones that can crawl, hover and perch

 

The Air Vehicles Directorate, a research arm of the Air Force, has released a computer-animated video outlining the the future capabilities of Micro Air Vehicles (MAVs). The project promises to revolutionize war by down-sizing the combatants. 

'MAVs will become a vital element in the ever-changing war-fighting environment and will help ensure success on the battlefield of the future,' the narrator intones.

'Unobtrusive, pervasive, lethal - Micro Air Vehicles, enhancing the capabilities of the future war fighter.'


Hovering: Micro Air Vehicles (MAVs) are the future of the unmanned drones program, according to a new video from the Air Force. The Air Force has already developed a drone capable of hovering like a moth

Perching: The video, released by the Air Vehicle Directorate, shows a pigeon-like drone that can draw power from an electrical wire while its camera watches a target

Crawling: The drones will be equipped with legs so that they can crawl through tight spaces like an insect
The project, which is based at Wright-Patterson Air Force Base in Dayton, Ohio, was revealed in the March issue of the National Geographic magazine.

Air Force officials said they have already produced tiny remote-control prototypes - but they consume so much power that can only operate for a few minutes. Researchers estimate that it will take several years of advances in battery technology to make the designs feasible. 

Still, the Air Force has a clear concept of what it hopes to accomplish with the program.

The promotional video begins with a swarm of tiny drones be dropped on a city from a passing plane. 

The drones will work in concert to patch together a wide, detailed view of the battlefield - singling out individual targets without losing sight of the broader scene. 

'Data will be communicated among the MAVs to enable real time, reliable decision-making and to provide an advanced overall picture for other platforms or operators,' the Air Force says.

Killing: The video demonstrates how MAVs could be used to sneak up behind unsuspecting targets and kill them with a single, lethal shot

Lethal: The drones could be equipped with incapacitating chemicals, combustible payloads or even explosives 'for precision targeting capability'
As the drones fall, they begin to fly - not like planes, but like insects. High frequency flapping wings allow the drones to hover and maneuver in tight spaces. 

The military has already produced a drone patterned after a hawk moth that can flap its wings 30 times a second. However, the activity exhausts the drone's tiny battery in just a few minutes, according to National Geographic.
Another drone type soars like a pigeon and perches unobtrusively on a power line to observe a surveillance target with a camera. 

The Air Force is working on technology that will allow the drones to steal electricity from power cables and other sources - so they can continue to operate for days or weeks on end.

Swarming: The drones couple be dropped en masse over a battlefield or a city and would work together to create a complex surveillance network

Working together: The drones would use advanced software to navigate by 'sight,' rather than GPS - which can be blocked by buildings or by jamming from the enemy
The Air Force training video shows a winged MAV following a target as he drives through the streets of a dense city. 

Advanced sensors will enable 'optic flow,' which will allow remote pilots to fly by 'sight' - rather than flying by GPS, which can be disrupted by buildings or deliberately jammed by enemy forces. 

The video depicts three drones following the target into a house, where they maneuver hallways and rooms undetected. 

'Small size and agile flight will allow MAVs to covertly enter locations inaccessible by traditional means of aerial surveillance,' the narrator says. 

The video follows the drones as they fly through an open door and sneak up behind a man who is aiming a sniper rifle. 

'Individual MAVs may perform direct attack missions and can be equipped with incapacitating chemicals, combustible payloads or even explosives for precision targeting capability,' according to the video.

On screen, a small, hovering vehicle pauses before shooting the man directly in the back of the head.

Read more:

• Unmanned Flight: The Drones Come Home - Pictures, More From National Geographic Magazine

Source

Rogue Traders, Rogue Princes, Rogue Bishops and the German Financial Meltdown of 1621-23

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Educational codicil for early Europe and their monetary crises.

March 29, 2012

“Kipper und Wipper”: Rogue Traders, Rogue Princes, Rogue Bishops and the German Financial Meltdown of 1621-23

 A German mint hard at work producing debased coinage designed to be palmed off on the nearest neighboring state, c.1620
The great German hyperinflation of 1923 is passing out of living memory now, but it has not been entirely forgotten. Indeed, you don’t have to go too far to hear it cited as a terrible example of what can happen when a government lets the economy spin out of control.

At its peak in the autumn of that year, inflation in the Weimar Republic hit 325,000,000 percent, while the exchange rate plummeted from 9 marks to 4.2 billion marks to the dollar; when thieves robbed one worker who had used a wheelbarrow to cart off the billions of marks that were his week’s wages, they stole the wheelbarrow but left the useless wads of cash piled on the curb. A famous photo taken in this period shows a German housewife firing her boiler with an imposing pile of worthless notes.

Easy though it is to think of 1923 as a uniquely terrible episode, though, the truth is that it was not. It was not even the worst of the 20th century; during its Hungarian equivalent, in 1945-46, prices doubled every 15 hours, and at the peak of this crisis, the Hungarian government was forced to announce the latest inflation rate via radio each morning–so workers could negotiate a new pay scale with their bosses—and issue the largest-denomination bank note ever to be legal tender: the 100 quintillion (10²⁰⁾ pengo note.

When the debased currency was finally withdrawn, the total value of all the cash then in circulation in the country was reckoned at 1/10th of a cent. Nor was 1923 even the first time that Germany had experienced an uncontrollable rise in prices. It had also happened long before, in the early years of the 17th century. And that hyperinflation (which is generally known by its evocative German name, the kipper-  und wipperzeit) was a lot stranger than what happened in 1923. In fact, it remains arguably the most bizarre episode in all of economic history.

Cheap fuel. A German woman fires
her boiler with wads of billion mark
notes, autumn 1923.

What made the kipper- und wipperzeit so incredible was that it was the product not only of slipshod economic management, but also of  deliberate attempts by a large number of German states to systematically defraud their neighbors. This monetary terrorism had its roots in the economic problems of the late 16th century and lasted long enough to merge into the general crisis of the 1620s caused by the outbreak of the Thirty Years’ War, which killed roughly 20 percent of the population of Germany. While it lasted, the madness infected large swaths of German-speaking Europe, from the Swiss Alps to the Baltic coast, and it resulted in some surreal scenes: Bishops took over nunneries and turned them into makeshift mints, the better to pump out debased coinage; princes indulged in the tit-for-tat unleashing of hordes of crooked money-changers, who crossed into neighboring territories equipped with mobile bureaux de change, bags full of dodgy money, and a roving commission to seek out gullible peasants who would swap their good money for bad.

By the time it stuttered to a halt, the kipper- und wipperzeit had undermined economies as far apart as Britain and Muscovy, and—just as in 1923—it was possible to tell how badly things were going from the sight of children playing in the streets with piles of worthless currency.

The economies of Europe had already been destabilized by a flood of precious metals from the New World (where in 1540 the Spaniards discovered an entire mountain of silver in Peru) and of copper from the Kopperburg in Sweden. This kick-started a sharp rise in inflation, as any substantial increase in the money supply will. In addition, there were limits to the control that most states had over their coinage. Foreign currency circulated freely in even the largest countries; the economic historian Charles Kindleberger estimates that in Milan, then a small but powerful independent duchy, as many as 50 different, mainly foreign, gold and silver coins were in use.  And so a good deal had to be taken on trust; at a time when coins actually were worth something—they were supposed to contain amounts of precious metal equivalent to their stated value—there was always a risk in accepting coins of unknown provenance. The strange currency might turn out to have been clipped (that is, had its edges snipped to produce metal shavings that could then be melted down and turned into more coins); worse, it might have been debased. Contemporary mints, which were often privately owned and operated under license from the state authorities, had yet to invent the milled edge to prevent clipping, and hand-produced coins by stamping them out with dies. In short, the system might have been designed to encourage crooked practice.

A German coin of the kipper-
und wipperzeit era, with
evidence of clipping on the
bottom right.

This was particularly the case in Germany, which was then not a single state but an unruly hodgepodge of nearly 2,000 more or less independent fragments, ranging in size from quite large kingdoms down to micro-states that could be crossed on foot in an afternoon. Most huddled together under the tattered banner of the Holy Roman Empire, which had once been a great power in Europe, but was by 1600 in disarray. At a time when Berlin was still a provincial town of no real note, the empire was ruled from Vienna by the Hapsburgs, but it had little in the way of central government and its great princes did much as they pleased. A few years later, the whole ramshackle edifice would be famously dismissed, in Voltaire’s phrase, as neither holy, nor Roman, nor an empire.


The coins minted in the Empire reflected this barely suppressed chaos. In theory the currency was controlled and harmonized by the terms of the Imperial Mint Ordinance issued at Augsburg in 1559, which specified, on pain of death, that coins could be issued only by a select group of imperial princes via a limited number of mints that were subject to periodic inspections by officials known as Kreiswardeine. In practice, however, the Ordinance was never rigorously enforced, and because it was cost more to mint low-denomination coins than larger ones, the imperial mints soon stopped producing many smaller coins.

Unsurprisingly, this practice soon created strong demand for the coins used in everyday transactions. Consequently, the empire began attracting, and circulating, foreign coins of unknown quality in large quantities, and unauthorized mints known as Heckenmünzen began to spring up like mushrooms after summer rains. As the number of mints in operation rose, demand for silver and copper soared. Coiners soon began to yield to the temptation to debase their coinage, reducing the content of precious metal to the point where the coins were worth substantially less than their face value. Inevitably, inflation began to rise.

Sir Thomas Gresham

Economists have long studied the problems “‘bad” money can cause an economy. The effects were first described by Sir Thomas Gresham (1518-79), an English merchant of Queen Elizabeth’s reign. Gresham is remembered for stating what has become known as “Gresham’s Law”—that the bad money in an economy drives out the good. Put more formally, the law implies that an overvalued currency (such as one in which the stated content of precious metal is much less than expected) will result either in the hoarding of good money (because spending it runs the risk of receiving bad money in change) or in the melting down and recoining of good money to make a larger amount of debased coinage.

What happened in Germany after bad money started to circulate there in about 1600 might have been designed as a case study in Gresham’s Law. Coins were increasingly stripped of their gold, silver and copper content; as a result, the imperial currency, the kreuzer, lost about 20 percent of its value between 1582 and 1609. After that, things began to go seriously wrong.Continue reading...

California Eases Tone as Latinos Make Gains

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From The New York Times:

In 1990, Latinos made up 30 percent of the state’s population; they will make up 40 percent — more than any other ethnic group — by the end of this year, and 48 percent by 2050, according to projections made by the state this month. This year, for the first time, Latinos were the largest ethnic group applying to the University of California system.

Most political observers say California is nowhere near the end of its political transformation. The share of white voters, who tend to be older, is expected to continue to decrease, while Latinos and Asians will make up more of the electorate.

Bad facts make bad law. We would never do this in Douglas without preclearing. Sounds like what we call "packing." - Voting Rights Act Is Challenged as Cure the South Has Outgrown

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From The New York Times:

 Jerome Gray, a 74-year-old black man, has voted in every election since 1974 in this verdant little outpost of some 4,000 people halfway between Mobile and Montgomery. Casting a ballot, he said, is a way to honor the legacy of the Voting Rights Act of 1965, a civil rights landmark born from a bloody confrontation 70 miles north of here, in Selma.

The franchise remains fragile in Evergreen, Mr. Gray said. Last summer, he was kicked off the voting rolls by a clerk who had improperly culled the list based on utility records.
A three-judge federal court in Mobile barred the city from using the new voting list, invoking Section 5 of the Voting Rights Act, which requires many state and local governments, mostly in the South, to obtain permission from the Justice Department or from a federal court in Washington before making changes that affect voting.  That provision is also at the heart of one of the marquee cases of the Supreme Court’s term, Shelby County v. Holder, No. 12-96, which will be argued on Feb. 27. It was brought by Shelby County, near Birmingham, and it contends that the provision has outlived its purpose of protecting minority voters in an era when a black man has been re-elected to the presidency.
 The Voting Rights Act was a triumph of the civil rights movement. It was a response, the Supreme Court said in upholding it in 1966, to “an insidious and pervasive evil which had been perpetuated in certain parts of our country through unremitting and ingenious defiance of the Constitution.”   Congress was entitled, the court went on, “to limit its attention to the geographic areas where immediate action seemed necessary.” Lawmakers chose the areas to be covered based on a formula that considered whether they had used devices to discourage voting, like literacy tests, and data from the 1964 election.
 The court in Mobile this month said the case before it, concerning Evergreen, was simple: because the city had not obtained preclearance from federal authorities, it could not revise its voting list using utility records. Nor could it use a municipal redistricting plan enacted by the City Council that had concentrated black voters, who are in the majority, into just two of the five districts, limiting black voting power.   It is not clear when the municipal election, originally scheduled for last August, will be held.
 A lawyer for Evergreen, James H. Anderson, said the ruling was justified. “The way the voter list was recomposed was improper,” he said. He added that the redistricting plan “could possibly be adopted by the Justice Department, but we need to tweak it a little bit.” In a court filing on Feb. 11, the city announced that it would create a third majority-black district “to have a total black population in the vicinity of 65 percent.”   Critics of the Section 5 preclearance requirement call it an unwarranted and discriminatory federal intrusion on state sovereignty and a badge of shame for the affected jurisdictions that is no longer justified.   But Mr. Anderson said he welcomed the process, to a point. “I think it plays a very valuable role, and I think we need it,” he said. “Personally, I think we need it nationwide.”
 The problem, he said, is that the provision applies in only some parts of the country. “I think it’s discriminatory because it picks on us Southerners,” he said.   Congress has repeatedly renewed the law, and for a while it used fresher data with each renewal. But when Congress renewed the law for 25 years in 2006, it made no changes to the list of jurisdictions covered by Section 5 and used data from the 1972 election as a baseline.
 The law applies to nine states — Alabama, Alaska, Arizona, Georgia, Louisiana, Mississippi, South Carolina, Texas and Virginia — and to scores of counties and municipalities in other states.

Having a right to opine from having been there and done that, I must say that I don't seriously disagree and it is worth considering: Stanley McChrystal says the U.S. should reinstitute the draft

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From The Washington Post:

“America suffers right now from the fact that many Americans don’t meet or deal with anybody outside their social or cultural circle,” retired Gen. Stanley McChrystal tells Foreign Affairs in a lengthy interview. “I think mandatory national service would have a huge effect to help us in that direction.”

It’s not a fundamentally new argument to say that the U.S., if it had a draft military, might be more careful about using military force and more restrained in deploying its service members. Still, it’s interesting to see McChrystal, who led the international force in Afghanistan before resigning in disgrace in 2010, making that case himself.

The “reinstate the draft” argument is typically associated with liberal Democrats and with opponents of U.S. military action, not with the generals who lead that action.

How Federal Spending Would Be Cut Under the Sequester - $85 billion? That sounds like a lot of money. How does this compare with the size of the government's budget? The government spent $3.538 trillion in the fiscal year that ended in September 2012. So $85 billion is 2.4% of the federal budget. What's unusual about the sequester, though, is that some of the largest programs in the federal budget are exempt. That means the cuts are concentrated on a smaller pool of government programs.

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From The Wall Street Journal:

On March 1, $85 billion in across-the-board federal spending cuts—known in Washington parlance as the sequester—are set to begin, prompted by a 2011 law designed to reduce the government's budget deficit. Here are answers to some commonly asked questions about how it would work, assuming it takes effect as scheduled.

Where did the sequester come from?

The sequester was one result of the deficit-reduction deal struck by the White House and Congress in the summer of 2011, which also raised the government's borrowing limit, and fits within Washington's broad yet stuttering efforts to bring the budget deficit down to levels most economists consider sustainable.

Republicans wanted significant spending cuts as a condition for voting to raise the debt ceiling. The parties agreed to raise the debt ceiling and implement new caps on spending for 10 years, which would save $917 billion. Both sides knew they would need more deficit reduction to win Republican support. So the White House proposed a process aimed at forcing lawmakers to craft a deal over the next 16 months.

First, they would create a congressional "supercommittee" with members from both parties to hammer out a deal to reduce the deficit by another $1.2 trillion over roughly a decade. The White House proposed a trigger called the "sequester" that would kick in if the committee failed and no other comparable deficit-reduction plan was reached.

The idea was that the sequester would be so dreadful it would force the two parties to reach a deal. Democrats and Republicans agreed to essentially split the spending cuts between defense and non-defense programs over nine years, beginning in 2013, and members of both parties voted for the plan.

The supercommittee failed to reach a deal. Now, while members of both parties agree the sequester is a bad way to reduce spending, they still can't agree on a substitute.

What happens on March 1?

The impact likely wouldn't be felt immediately because the agencies would have to adjust their budgets. Many of the cuts wouldn't take place until weeks or months later.

Many federal agencies would begin informing roughly one million civilian employees that they could soon be forced to take unpaid leave, one day per week perhaps. These furloughs likely won't begin until around April.

Federal agencies affected also would send letters to contractors and state and local officials informing them of the cuts. They could detail the size and extent of the reductions over the remaining seven months of the federal fiscal year, which ends Sept. 30.

That could in turn force a state governor who receives federal aid or a contractor with government business to reevaluate their own budgets and inform employees or subcontractors of their own cuts. It could take a while for the ripple effect to spread.

Which agencies and programs are affected?

Most agencies would be affected, but a large number are exempt. Those affected by the cuts include the departments of energy, state, defense, labor, transportation, justice and the National Institutes of Health.

Among those exempted are the Federal Reserve and the U.S. Postal Service, which have revenue sources outside the federal budget; benefits paid by the Social Security, Medicare and Medicaid programs; and military pay for uniformed personnel.

How will spending be cut?

First, agencies would cut back on spending such as travel and filling vacant positions, seeking to minimize the impact.

Many agencies would further reduce labor costs through the furloughs. For example, the Federal Aviation Administration has said it could force all of its 47,000 employees, including air traffic controllers, to take unpaid leave for a certain period.

The Social Security Administration said the cuts could mean it takes longer for Americans to file retirement and disability claims, and the Internal Revenue Service has said they could complicate the April tax filing season.

How will the cuts be allocated?

The cuts will be split among around 1,200 different federal programs, and then extended to tens of thousands of subprograms and projects.

The reductions would be split into three broad categories.

1) Defense spending, which includes Pentagon and defense intelligence spending, accounts for half the sequester cuts. Many of these programs will be reduced by roughly 13% over seven months.

2) Non-defense spending. This would include housing, education, or transportation programs.

3) Medicare. There will be a 2% cut in the payments to Medicare providers, such as hospitals and doctors.

Do the cuts have to be spread evenly over the remaining seven months?

Not necessarily. Agencies will have the flexibility to apportion the cuts as they see fit over time. But they will likely try to spread them out as much as possible, believing that the impact will be less concentrated. Also, while the sequester cuts the agencies' "budget authority" by about $85 billion between March 1 and Sept. 30, actual outlays of government dollars would fall by about $44 billion during this period, with the rest of the decline occurring later, according to the Congressional Budget Office. This is because outlays often lag the budget by months or years.

How much flexibility will agencies have to shield some programs from cuts?

The White House and federal agencies say there won't be much flexibility, in part because each program and subprogram is subject to the same "across-the-board" reductions.

Sen. James Inhofe (R., Okla.) has proposed passing a law that would give agencies more flexibility in how they decide to apportion the cuts, but the White House has said that would be unworkable given the reductions that must be taken.

How are government contractors affected?

This is one of the biggest mysteries because it depends on how companies try to absorb the cuts or change their business models. Many defense contractors warn the cuts could hurt their businesses, but many are already seeing their business decline as the military winds down two wars and adjusts to other budget reductions.

A range of companies have raised alarms about the potential impact of the sequester, but most say they have no clear sense what the precise impact would be.

$85 billion? That sounds like a lot of money. How does this compare with the size of the government's budget ?

The government spent $3.538 trillion in the fiscal year that ended in September 2012. So $85 billion is 2.4% of the federal budget.

What's unusual about the sequester, though, is that some of the largest programs in the federal budget are exempt. That means the cuts are concentrated on a smaller pool of government programs. Depending on the agency, cuts are going to be in the ballpark of 5% and 13%, according to various estimates from government officials.

If the furloughs don't begin in force until around April, doesn't the government have time to sort things out?

Probably. White House officials stress that the impact will be felt in March as the cuts begin to take shape, but the actual impact is less clear.

Another looming deadline is March 27. That's when funding for a number of federal programs is projected to run out. If Congress doesn't reach a deal to fund the government by then, we would face a partial government shutdown. That would mean many federal workers would no longer face just a one-day-a-week furlough. Rather, they would be sent home indefinitely.