Wednesday, March 13, 2013
Turkey's Banking System Begins to Use Gold as Money
Kitco interviews Jeff Christian, who reports that the Turkish central bank now allows its commercial banks to use gold as reserves for deposits, and about 7% of deposits in Turkish banks are backed by gold. Christian believes that other countries will imitate Turkey's move, which he describes as pure genius. Christian is a modest gold bear, predicting a $1540 bottom over the next two years. It seems to me that if banking systems begin to imitate Turkey, monetary demand for gold will be a bullish factor. Christian also predicts a move away from the dollar as banking systems embark on a multicurrency regime. Over the long run the dollar will slide. This is going to devastate Social Security and pension payments, leading to a meager old age for the baby boom generation.
Thursday, March 7, 2013
My Prediction on the Price of Gold
I made the following prediction about the price of gold to the German financial website Focus-Money:
The US monetary base has more than tripled in the past six
years;* the large commercial banks can multiply each dollar that the
Federal Reserve Bank creates up to tenfold. The banks’ lending often has
been ill advised. The collapse of Lehman Brothers** and the survival of
other large Wall Street firms through public subsidization evidence
misallocation of wealth, which has caused income inequality and slowed the free
market system’s creative processes. The resultant income inequality and growth
reduction have increased demand for welfare entitlements. Whether,
in the short run, there is deflation due to loan defaults or inflation due to
monetary expansion, there will be dollar instability. Recently, the
dollar’s reserve currency status and China’s trade policies have mitigated
inflation, but this lucky (for the U.S.) arrangement can change
overnight. Because of public demand for entitlements--caused by
injudicious, state-guided economic policies--the US government, like several
European governments, is borrowing at an unsustainable rate and lacks the
political will to contract its borrowing. Economic and dollar instability
coupled with government’s unquenchable thirst for debt to subsidize
entitlements will lead to expansion of the recently created bank reserves to
monetize government’s debt. The result will be depreciation of the dollar
and an end to the dollar’s reserve currency status, much like the end to the
pound’s role in the early twentieth century. The ultimate price of gold
is unpredictable in dollar terms, and it may go to infinity. As with many
economic phenomena, the difficult question is when my predictions will unfold.
I will say $2,000 in two years, $4,000 in ten years.
*http://research.stlouisfed.org/fred2/series/BASE/ .
**Larry McDonald, A Colossal Failure of Common Sense.
Friday, February 15, 2013
The Anti-Federalists Are the Best Part of America
I am in the middle of Jackson Turner Main's The Anti-Federalists: Critics of the Constitution 1781-1788. Main is a great historian who meticulously traces the economic characteristics of each state's counties at the time of the Constitutional Convention and shows that the Federalist counties tended to be the wealthier ones while the anti-Federalist counties tended to be the ones where subsistence farming predominated. Although there were wealthy people on both sides of the debate, Main shows that the economic divide was largely between indebted or subsistence farmers who lived inland and those who lived on coasts, along rivers,or in cities,and so participated in commercial life. There was therefore more substance to Charles Beard's claims in his Economic Interpretation of the Constitution than many historians and most supporters of the Constitution would prefer. That is, the Constitution was largely passed to subvert democracy and home rule. It was passed under false pretenses: Much of Hamilton's writings in The Federalist Papers was lies, which caused Madison, whom Hamilton had hoodwinked, to break with Hamilton and side with Jefferson once the Constitution was ratified.
One of Federalists' biggest lies was their name: "Federalist" refers to an advocate of a system with strong constituent states tied together with a weak central government. The anti-Federalists were actually the Federalists; the so-called "Federalists" should have been called "Nationalists." Because most Americans at the time favored a Federalist, not a Nationalist, system, the Federalists lied. Being from wealthier backgrounds, they were more adept at political manipulation. In effect, from the beginning the Constitution was based on deception.
The anti-Federalists' objections to the Constitution include current issues: the federal government has escalated taxes; the Supreme Court has arrogated power; the executive branch has become a kingly office; a national government is too big to be democratic; the national government is guided by special interests; the national government is dominated by a financial elite. These and related points were all made by anti-Federalists such as George Clinton, Abraham Yates, Luther Martin, William Findley, and Samuel Adams.
Main makes clear that the Federalists frequently misrepresented their views about their intentions and what they believed would be the Constitution's effects. Hamilton, for example, makes no mention of the "necessary and proper clause" being the basis for a central bank in The Federalist Papers. He saved that claim for the year following the Constitution's adoption. What we are witnessing today-- federal consolidation, hyperelitist oligarchy, and presidential tyranny--the anti-Federalists foresaw.
I am tempted to say that they would have been surprised that it has taken this long to occur, but the level of tyranny that Americans live with today would have been unthinkable in 1786. What would have seemed a tyrannical society to the anti-Federalists seems like a freer one to us. The anti-Federalists would have viewed Andrew Jackson as an insufferable tyrant. The Constitution made America into a servile nation, a nation where human dignity is impossible.
Can a world like the anti-Federalists' be recreated? I think not, but to begin to approximate one, it is necessary to live in a smaller country. The American states on average had populations of fewer than 300,000 people; the total was about 3 million. That is difficult to find today, but Uruguay has a population of about 3 million too, roughly equal to the United States population in 1787; Switzerland has a population of under 8 million; Singapore slightly over 5; Chile has 17. All of these countries are freer than the US except for Uruguay, but Uruguay has great beaches and isn't far from Buenos Aires and Rio. Each of these countries also has stabler economies. I suspect that the citizenry of these countries is more committed to freedom than Americans are, and they are more moral.
Too bad the Constitution replaced the Articles of Confederation. America would have been more economically and politically successful if it hadn't. The Civil War would have been avoided, along with more than one half million deaths. Likely slavery would not have expanded because the Fugitive Slave Law could not have been passed. Likely, the Constitution was responsible both for the explosion of slavery following the invention of the cotton gin in 1793 and for the Civil War. Without the Constitution there would have been less federal regulation, so innovation would have been greater. The world would have advanced more quickly, and for a longer period, had the Constitution not given commercial interests power to institute a tyranny here.
One of Federalists' biggest lies was their name: "Federalist" refers to an advocate of a system with strong constituent states tied together with a weak central government. The anti-Federalists were actually the Federalists; the so-called "Federalists" should have been called "Nationalists." Because most Americans at the time favored a Federalist, not a Nationalist, system, the Federalists lied. Being from wealthier backgrounds, they were more adept at political manipulation. In effect, from the beginning the Constitution was based on deception.
The anti-Federalists' objections to the Constitution include current issues: the federal government has escalated taxes; the Supreme Court has arrogated power; the executive branch has become a kingly office; a national government is too big to be democratic; the national government is guided by special interests; the national government is dominated by a financial elite. These and related points were all made by anti-Federalists such as George Clinton, Abraham Yates, Luther Martin, William Findley, and Samuel Adams.
Main makes clear that the Federalists frequently misrepresented their views about their intentions and what they believed would be the Constitution's effects. Hamilton, for example, makes no mention of the "necessary and proper clause" being the basis for a central bank in The Federalist Papers. He saved that claim for the year following the Constitution's adoption. What we are witnessing today-- federal consolidation, hyperelitist oligarchy, and presidential tyranny--the anti-Federalists foresaw.
I am tempted to say that they would have been surprised that it has taken this long to occur, but the level of tyranny that Americans live with today would have been unthinkable in 1786. What would have seemed a tyrannical society to the anti-Federalists seems like a freer one to us. The anti-Federalists would have viewed Andrew Jackson as an insufferable tyrant. The Constitution made America into a servile nation, a nation where human dignity is impossible.
Can a world like the anti-Federalists' be recreated? I think not, but to begin to approximate one, it is necessary to live in a smaller country. The American states on average had populations of fewer than 300,000 people; the total was about 3 million. That is difficult to find today, but Uruguay has a population of about 3 million too, roughly equal to the United States population in 1787; Switzerland has a population of under 8 million; Singapore slightly over 5; Chile has 17. All of these countries are freer than the US except for Uruguay, but Uruguay has great beaches and isn't far from Buenos Aires and Rio. Each of these countries also has stabler economies. I suspect that the citizenry of these countries is more committed to freedom than Americans are, and they are more moral.
Too bad the Constitution replaced the Articles of Confederation. America would have been more economically and politically successful if it hadn't. The Civil War would have been avoided, along with more than one half million deaths. Likely slavery would not have expanded because the Fugitive Slave Law could not have been passed. Likely, the Constitution was responsible both for the explosion of slavery following the invention of the cotton gin in 1793 and for the Civil War. Without the Constitution there would have been less federal regulation, so innovation would have been greater. The world would have advanced more quickly, and for a longer period, had the Constitution not given commercial interests power to institute a tyranny here.
Monday, February 4, 2013
Getting Academic Freedom Not Quite Right
I sent Brooklyn College's President Karen Gould a response to her letter today concerning the appearance at Brooklyn College of Omar Barghouti, the advocate of sanctions against Israeli academics:
President Gould, as a practical matter I support your decision to allow Barghouti's appearance, but some of the faculty here at Brooklyn have substituted political advocacy for academics and so have a biased, unfair, and inaccurate definition of academic freedom. I urge you to address the comparison between Evan Goldwyn in 2005 and Omar Barghouti in 2013 in a public statement. In 2005 the now-defunct New York Sun ran an article on Goldwyn. The same academics now claiming that Barghouti, a master's degree student, deserves academic freedom then said that Goldwyn, also a student, was not entitled to academic freedom because he was a student. See: http://www.nysun.com/new-york/disposition-emerges-as-issue-at-brooklyn-college/14604/ .
In the Goldwyn case Professor Parmar attempted to throw Goldwyn out of school because he disagreed with her claim that English is the language of white oppressors. Several professors now arguing for Barghouti's academic freedom then argued that students are not entitled to academic freedom. Would you please comment publicly on the different response to the two cases? Goldwyn was saved only by the publicity KC Johnson brought, not because, since the 1990s or earlier, the school has had a history of supporting academic freedom--except for left-wingers. Barghouti has an international reputation as a political propagandist or activist, not as an academic. Section 501 (c) (3) explicitly rejects political propaganda as part of an educational institution's mission, and in taking a tax exemption Brooklyn College committed to that position. Are you reversing that position now, or are you claiming that Barghouti is an academic?
Also, the claim that there is academic freedom in a political science department with 100% left-wingers and 0% conservatives, libertarians, or other alternative viewpoints, with any alternative views being suppressed or excluded, is a joke. The same is true of the economics department, which has excluded, for example, the Austrian economics viewpoint.
As well, political propaganda is not academic or educational, as Section 501 (c) (3) clearly states. If the college, as apparently the political science department does, sees its role as propaganda rather than education (a position which former provost Roberta Matthews advocated--but not for tax purposes, concerning which she was willing to lie--when she said that all teaching is political), I would appreciate your explicit clarification of why a talk that advocates sanctions against Israeli academics is in any sense "academic" or "educational" as required by section 501(c)(3) for tax exemption purposes.
-----Original Message-----
From: Karen L. Gould, President [mailto:bcpresident@brooklyn.cuny.edu]
Sent: Mon 2/4/2013 10:50 AM
To: Staff E-Mail
Subject: A steadfast commitment to academic freedom with a commitment to ongoing dialogue and debate
Dear students, faculty, and staff,
During the past week, due to an upcoming event about the BDS movement, our campus has been wrestling with issues of tremendous importance to our college and our community. There are passionate views on many sides. While we appreciate the many voices of support for our stand on academic freedom, we cannot disregard the concerns raised by some of our students and alumni.
First, however, let me be clear: Our commitment to the principles of academic freedom remains steadfast. Students and faculty, including academic departments, programs, and centers, have the right to invite speakers, engage in discussion, and present ideas to further educational discussion and debate. The mere invitation to speak does not indicate an endorsement of any particular point of view, and there is no obligation, as some have suggested, to present multiple perspectives at any one event. In this case, the department's co-sponsorship of the event is an invitation to participate; it does not indicate an endorsement of the speakers' positions. Providing an open forum to discuss important topics, even those many find highly objectionable, is a centuries-old practice on university campuses around the country. Indeed, this spirit of inquiry and critical debate is a hallmark of the American education system.
At the same time, it is essential that Brooklyn College remain an engaged and civil learning environment where all views may be expressed without fear of intimidation or reprisal. As I stated last week, we encourage debate, discussion, and more debate. Students and faculty should explore these and other issues from multiple viewpoints and in a variety of forums so that no single perspective serves as the only basis for consideration. Contrary to some reports, the Department of Political Science fully agrees and has reaffirmed its longstanding policy to give equal consideration to co-sponsoring speakers who represent any and all points of view.
Over the next two months, with the support of the Wolfe Institute for the Humanities and other campus units and community groups, we will provide multiple opportunities for discussion about the topics and related subject matter at the heart of this controversy. In addition to Thursday evening's event, at which I encourage those with opposing views to participate in the discussion and ask tough questions, other forums will present alternative perspectives for consideration. The college welcomes participation from any groups on our campus that may wish to help broaden the dialogue. At each of these events, please keep in mind that students, faculty, staff, and guests are expected to treat one another with respect at all times, even when they strongly disagree.
Finally, to those who have voiced concern that our decision to uphold the rights of our students and faculty signals an endorsement of the speakers' views, I say again that nothing could be further from the truth. Moreover, I assure you that our college does not endorse the BDS movement nor support its call for boycott, divestment, and sanctions against Israel. As the official host of the CUNY center for study abroad in Israel, our college has a proud history of engagement with Israel and Israeli universities. In fact, over the past two years we have renewed our efforts to reconnect with existing institutional partners and to develop new relationships as well for faculty and student exchanges with Israeli institutions. We deeply value our Israeli partners and would not endorse any action that would imperil the State of Israel or its citizens, many of whom are family members and friends of our students, faculty, staff, alumni, and neighbors.
As one of the most diverse colleges in the country, it is particularly important that Brooklyn College foster an inclusive environment where all may voice their points of view across the full spectrum of social, political, and cultural issues of our time. As Supreme Court Justice Louis Brandeis wisely stated nearly a century ago, when one finds another's speech offensive, "...the remedy to be applied is more speech, not enforced silence." Together, we must work to ensure that on our campus more and more speech continues to occur so that our students can be broadened in their knowledge, challenged in their thinking, and encouraged to bring their own analysis and values to bear on a wide range of topics of local, national, and global interest.
Sincerely,
Karen L. Gould
President
President Gould, as a practical matter I support your decision to allow Barghouti's appearance, but some of the faculty here at Brooklyn have substituted political advocacy for academics and so have a biased, unfair, and inaccurate definition of academic freedom. I urge you to address the comparison between Evan Goldwyn in 2005 and Omar Barghouti in 2013 in a public statement. In 2005 the now-defunct New York Sun ran an article on Goldwyn. The same academics now claiming that Barghouti, a master's degree student, deserves academic freedom then said that Goldwyn, also a student, was not entitled to academic freedom because he was a student. See: http://www.nysun.com/new-york/disposition-emerges-as-issue-at-brooklyn-college/14604/ .
In the Goldwyn case Professor Parmar attempted to throw Goldwyn out of school because he disagreed with her claim that English is the language of white oppressors. Several professors now arguing for Barghouti's academic freedom then argued that students are not entitled to academic freedom. Would you please comment publicly on the different response to the two cases? Goldwyn was saved only by the publicity KC Johnson brought, not because, since the 1990s or earlier, the school has had a history of supporting academic freedom--except for left-wingers. Barghouti has an international reputation as a political propagandist or activist, not as an academic. Section 501 (c) (3) explicitly rejects political propaganda as part of an educational institution's mission, and in taking a tax exemption Brooklyn College committed to that position. Are you reversing that position now, or are you claiming that Barghouti is an academic?
Also, the claim that there is academic freedom in a political science department with 100% left-wingers and 0% conservatives, libertarians, or other alternative viewpoints, with any alternative views being suppressed or excluded, is a joke. The same is true of the economics department, which has excluded, for example, the Austrian economics viewpoint.
As well, political propaganda is not academic or educational, as Section 501 (c) (3) clearly states. If the college, as apparently the political science department does, sees its role as propaganda rather than education (a position which former provost Roberta Matthews advocated--but not for tax purposes, concerning which she was willing to lie--when she said that all teaching is political), I would appreciate your explicit clarification of why a talk that advocates sanctions against Israeli academics is in any sense "academic" or "educational" as required by section 501(c)(3) for tax exemption purposes.
-----Original Message-----
From: Karen L. Gould, President [mailto:bcpresident@brooklyn.cuny.edu]
Sent: Mon 2/4/2013 10:50 AM
To: Staff E-Mail
Subject: A steadfast commitment to academic freedom with a commitment to ongoing dialogue and debate
Dear students, faculty, and staff,
During the past week, due to an upcoming event about the BDS movement, our campus has been wrestling with issues of tremendous importance to our college and our community. There are passionate views on many sides. While we appreciate the many voices of support for our stand on academic freedom, we cannot disregard the concerns raised by some of our students and alumni.
First, however, let me be clear: Our commitment to the principles of academic freedom remains steadfast. Students and faculty, including academic departments, programs, and centers, have the right to invite speakers, engage in discussion, and present ideas to further educational discussion and debate. The mere invitation to speak does not indicate an endorsement of any particular point of view, and there is no obligation, as some have suggested, to present multiple perspectives at any one event. In this case, the department's co-sponsorship of the event is an invitation to participate; it does not indicate an endorsement of the speakers' positions. Providing an open forum to discuss important topics, even those many find highly objectionable, is a centuries-old practice on university campuses around the country. Indeed, this spirit of inquiry and critical debate is a hallmark of the American education system.
At the same time, it is essential that Brooklyn College remain an engaged and civil learning environment where all views may be expressed without fear of intimidation or reprisal. As I stated last week, we encourage debate, discussion, and more debate. Students and faculty should explore these and other issues from multiple viewpoints and in a variety of forums so that no single perspective serves as the only basis for consideration. Contrary to some reports, the Department of Political Science fully agrees and has reaffirmed its longstanding policy to give equal consideration to co-sponsoring speakers who represent any and all points of view.
Over the next two months, with the support of the Wolfe Institute for the Humanities and other campus units and community groups, we will provide multiple opportunities for discussion about the topics and related subject matter at the heart of this controversy. In addition to Thursday evening's event, at which I encourage those with opposing views to participate in the discussion and ask tough questions, other forums will present alternative perspectives for consideration. The college welcomes participation from any groups on our campus that may wish to help broaden the dialogue. At each of these events, please keep in mind that students, faculty, staff, and guests are expected to treat one another with respect at all times, even when they strongly disagree.
Finally, to those who have voiced concern that our decision to uphold the rights of our students and faculty signals an endorsement of the speakers' views, I say again that nothing could be further from the truth. Moreover, I assure you that our college does not endorse the BDS movement nor support its call for boycott, divestment, and sanctions against Israel. As the official host of the CUNY center for study abroad in Israel, our college has a proud history of engagement with Israel and Israeli universities. In fact, over the past two years we have renewed our efforts to reconnect with existing institutional partners and to develop new relationships as well for faculty and student exchanges with Israeli institutions. We deeply value our Israeli partners and would not endorse any action that would imperil the State of Israel or its citizens, many of whom are family members and friends of our students, faculty, staff, alumni, and neighbors.
As one of the most diverse colleges in the country, it is particularly important that Brooklyn College foster an inclusive environment where all may voice their points of view across the full spectrum of social, political, and cultural issues of our time. As Supreme Court Justice Louis Brandeis wisely stated nearly a century ago, when one finds another's speech offensive, "...the remedy to be applied is more speech, not enforced silence." Together, we must work to ensure that on our campus more and more speech continues to occur so that our students can be broadened in their knowledge, challenged in their thinking, and encouraged to bring their own analysis and values to bear on a wide range of topics of local, national, and global interest.
Sincerely,
Karen L. Gould
President
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