No Paper Is Safe From A Bail-In: FSB
Written by Jeff Nielson
Saturday, 06 April 2013 15:28
Ever since our governments perpetrated the Cyprus Steal roughly three weeks ago (the first of their “bail-ins”), I have been exploring the ramifications of this crime. My apologies to readers for any redundancy since then; however it has been necessary to cover this subject in a methodical manner in order to precisely and conclusively illustrate that:
– The Cyprus Steal was a premeditated act, plotted (at least) 18 months in advance; which included warning the Big Money to move their wealth out of harm’s way
– Many/most other Western regimes already have their own “bail-in” rules firmly in place
– The entire premise of the “bail-in” (i.e. confiscating money from peoples’ accounts) is flawed and fraudulent; meaning there could never be any rational or legitimate reason for this policy – making it a simple act of theft
Having established each of these points in previous commentaries; it’s now time to bring this analysis (in general terms) to a culmination: pointing out that the “bail-in” rules already in place do not merely contemplate stealing from bank accounts, but rather stealing any/every kind of paper asset from “the financial system more widely.”
The language used is unequivocal, the intentions beyond doubt. Why is it so much easier in retrospect to point out a “crime” plotted (at least) 18 months in advance? Because the bankers put out “policy papers” the way most people pass wind. Few if any of us have the luxury of wading through the endless pages of these documents merely to separate “hot air” from more of their devious (and illegal) plans.
It is now clear that the “centerpiece” of this planning is a policy paper issued by the Financial Stability Board in October 2011, entitled Key Attributes of Effective Resolution Regimes for Financial Institutions. The relevant language is spelled-out in Section 6:
6.3 Jurisdictions should have in place privately-financed deposit insurance or…a funding mechanism for ex post recovery from the industry of the costs of providing temporary financing to facilitate the resolution of the firm. [i.e. continuing to prop-up insolvent banks]
Obviously the only possible way in which deposit insurance could be a “mechanism for ex post recovery” is if these bankers/governments are stealing from peoples’ bank deposits. However, lest anyone holding bonds, pension funds, or other (paper) financial assets has been lulled into a false sense of security in thinking that only bank accounts are at risk, Section 6.5 should instantly torpedo that complacency:
6.5 As a last resort [the expression the Banksters began using back in 2008 when they began all this monetary insanity]…some countries may decide to have a power to…recover any losses incurred by the state from unsecured creditors or, if necessary, the financial system more widely. [emphasis mine]
The “financial system more widely” means any bank account, any bond, any pension, any equity; or more simply any paper one has in any financial institution.
Who/what is the “Financial Stability Board”? It is a very exclusive club. How exclusive? You can only join if you’re a Western Central Banker. It is the (official) voice of Western central banks, and thus it is above the mere “laws” enacted by our subordinate governments.
How do we know the authority of these central banks is supreme to the laws governing the Little People (i.e. us)? The central banks themselves make this unequivocally clear. When we have the audacity to even suggest an audit of our financial system, they (and their apologists in the Corporate Media) tell us it “threatens their Independence.”
If the central banks are Independent, what does that make our governments? That’s right, the Dependents. As a tautology, they can’t both be “independent.” And only one entity in this relationship is allowed to say to the other “no, I won’t let you do this.”
However, if even this tautological argument doesn’t convince readers that central banks are above the Law; our Puppet Politicians make this explicitly clear in official documents, such as the Canadian Budget. Mark Carney, Governor of the Bank of Canada and Chairman of the Financial Stability Board decreed that “bail-ins” should be the new law for the Little People of Canada.
Prime Minister Stephen Harper heard. Stephen Harper obeyed. From page 154 of Canada’s 2013 Budget:
…The Government intends to implement a comprehensive risk management framework for Canada’s systemically important banks. This framework will be consistent with reforms in other countries [i.e. the Cyprus Steal] and key international standards, such as the Financial Stability Board’s Key Attributes of Effective Resolution Regimes for Financial Institutions, and will work alongside the existing Canadian regulatory capital regime. [emphasis mine]
In case any Canadians weren’t sure whether this included stealing, Prime Minister Harper erases any ambiguity there (in the Budget’s next bullet-point):
…The Government proposes to implement a “bail-in” regime for systemically important banks.
Still not convinced that the central banks are our Financial Overlords, entirely above the law; who regularly tell our subordinate governments what to do? Let me introduce you to the Bank for International Settlements (BIS).
The BIS is the “supreme” (Western) central bank: the central bank of/for other central banks. It is located within the geographic boundaries of Switzerland, but it’s not a part of “Swiss territory”. Instead, it is its own sovereign soil – virtually identical to the above-the-law status of the Vatican within the geographic boundaries of Italy.
No “Swiss authority” (police/political/military) is allowed to set foot on “BIS territory” without the written permission of one of two executives within the BIS. It is completely immune to any/all Swiss law. Or put more simply, it’s also “independent.”
In a somewhat less-lofty context, the BIS is known as the lynchpin for the $trillions in money-laundering in which Western Big Banks engage every year mostly drug-money or terrorist-money. These Big Banks are caught engaging in their money-laundering on a now virtually weekly basis, and thus the routine is painfully familiar.
No banker is ever even arrested, let alone charged with a crime. The bank itself is never required to even admit wrong-doing; no matter how many $billions are involved, or how many times the bank has previously been caught money-laundering. The “fine” is inevitably some fraction of 1% of the actual quantity of money-laundering. It is such a pathetically microscopic sum that we can’t even call it a “cut” in return for our governments being the junior-accomplices in this organized crime.
Our Big Banks are nothing but a crime syndicate. The central bankers are the Mafia “dons”. This Crime Syndicate has now issued a decree to our Puppet Politicians that they wish to engage in a new form of crime, and to simply change our laws (the laws of the Little People) so that their stealing is now “legal.” The politicians have obeyed.
When I wrote How Your Bank Account Could Disappear back in July, 2012; it was in specific response to the even less-legal, more heavy-handed “bank robbery” which had occurred in the “MF Global” heist. I pointed out that ¼ of Wall Street executives had already confessed to believing that crime was a way of life for Big Banks.
At that time, I summed up in general terms the only attitude which any rational individual can have when it comes to entrusting any of their wealth to this Crime Syndicate:
What the large financial institutions of the 21st century have taught us (through the cruel “lessons” of their serial crimes) is that there is no one in the world whom you can trust less with your money than a banker.
Statistics: Posted by yoda — Sun Apr 07, 2013 1:50 pm
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The Great Cyprus Bank Robbery Shows That No Bank Account, No Retirement Fund And No Stock Portfolio Is Safe
The global elite have now proven that when the chips are down they are going to go after any big pile of money that they think they can get their hands on. That means that no bank account, no retirement fund and no stock portfolio on earth is safe. Up until now, most people assumed that private bank accounts were untouchable and that deposit insurance actually meant something. Now we see that there is no pile of money that is considered “off limits” by the global elite and deposit insurance means absolutely nothing. The number one thing that any financial system depends on is faith. If people do not have faith in the safety and stability of a financial system, it will not work. Well, the people that rule the world have just taken a sledgehammer to the trust that we all had in the global financial system. They have broken the unwritten social contract that global banking depends on. So now we will see a run on the banks, and this will not just be limited to a few countries in southern Europe. Rather, this will be worldwide in scope. Yoda may have put it this way: “Begun, the global bank run has.” All over the world, frightened people are going to start pulling money out of the banks. A lot of that money will go into gold, silver and other hard assets. And as money starts coming out of the banks, this could cause many of the large banks that have been teetering on the edge of disaster to finally collapse.
Many of you may not believe that they would ever come after bank accounts, retirement funds or stock portfolios in the United States.
Many of you may be entirely convinced that the Great Cyprus Bank Robbery could never happen in America.
Well, where do you think this whole plan was dreamed up?
It was the IMF that reportedly pushed the hardest for the wealth tax in Cyprus, and the IMF is headquartered right in the heart of Washington D.C.
Almost every nation on the planet has to deal with the IMF. It is an organization that is dominated by the United States and that is always involved when there is an international debt crisis.
If the IMF thinks that it is a great idea to steal from bank accounts to solve a financial crisis in Cyprus, why wouldn’t they impose a similar solution in other countries in the future?
And if bank accounts are no longer safe, are there any truly safe places to put your money?
You can trust the politicians when they tell you that an unannounced “wealth tax” will never happen where you live if you want, but that is the exact same lie that the politicians in Cyprus were telling their people until the day that it happened. The following is from an article in the Cyprus Mail…
And after all, President Anastasiades had emphatically declared in his inauguration speech that “absolutely no reference to a haircut on public debt or deposits will be tolerated,” adding that “such an issue isn’t even up for discussion.” Finance Minister Michalis Sarris made similarly reassuring statements, arguing that it would be lunacy for the EU to impose such a measure because it would threaten the euro system.
At this point, politicians in Cyprus have been given two very unappealing options. Either they vote yes on the wealth tax and destroy all faith in the banking system of Cyprus, or they vote no and they are forced out of the eurozone. In either case, we will probably see the financial system of Cyprus collapse and their economy plunge deep into depression.
At this point, the vote has been delayed until Tuesday. Apparently some additional “arm twisting” was required to get the needed votes.
And there have been proposals to change the terms of the wealth tax. Reportedly, some politicians want to impose a maximum rate of up to 15 percent on bank accounts of over 500,000 euros so that the rate on smaller accounts can be decreased.
It has also been announced that the earliest that banks in Cyprus will reopen will be Thursday.
But what is happening in Cyprus is small potatoes compared to how this will affect the rest of the world. The entire planet is watching this unfold, and as a recent article by Lucas Jackson described, faith in the global financial system is being greatly shaken…
It would be hard to over-emphasize how significant the Cyprus situation is. The EU demonstrated under no uncertain circumstances that they will destroy the rule of law to maintain their own power. It was a recognition of tyranny that many of us have always assumed was the case but yesterday became reality.
The damage done here is not related to the size of the haircut – currently discussed between 3 and 13% – but rather that the legal language which each and every investor on the planet must rely on in order to maintain confidence in the system has been subordinated to the needs of the powerful elite. To the power elite making the major decisions in DC, London, Berlin, France, Brussels, et. al., laws are like ice cream, easily melted.
Which begs the question, who is next? Will it be Portugal? Greece? Spain? Italy? France???
Will they impose a “one-time” tax on your bank account? Your house? Your stocks and bonds? Retirement accounts?
The global elite have declared open season on all large piles of money, and now many people all over the world will consider taking money out of the bank to be the rational thing to do. This will especially be true in countries in southern Europe since they would probably be the next to have wealth confiscated.
This is so abundantly clear that even Paul Krugman of the New York Times understands this…
It’s as if the Europeans are holding up a neon sign, written in Greek and Italian, saying “time to stage a run on your banks!”
Tomorrow and the days immediately following should be very interesting.
The global elite have truly “crossed the Rubicon” by going after private bank accounts. It is almost as if they purposely chose the most damaging solution possible to the financial crisis in Cyprus.
Many in the financial world are absolutely stunned by all of this. For example, David Zervos is describing this move as a “nuclear war on savings and wealth“…
All of us should really take a moment to consider what the governments of Europe have done. To be clear, they initiated a surprise assault on the precautionary savings of their own people. Such a move should send shock waves across the entire population of the developed world. This was not a Bernanke style slow moving financial repression against risk free savings that is meant to stir up animal spirits and force risk taking. This is a nuclear war on savings and wealth – something that will likely crush animal spirits. This is a policy move you expect from a dictatorial regime in sub-Saharan Africa, not in an EMU member state. If the European governments can clandestinely expropriate 7 to 10 percent of their hard working citizen’s precautionary savings after the close of business on a Friday night, what else are they capable of doing? Why even hold money in a bank account? Are they trying to start a bank run?
So what motivated the global elite to do this?
According to CNBC, one of the motivations was to go after the Russians that had been using the banking system of Cyprus to launder money…
Indeed, the IMF is reported to have been keen on the levy as a way to stem the flood of Russian money into the island over the last few years which has prompted concerns over money laundering.
Russian money accounts for about 25 percent of all money in the banking system of Cyprus, and obviously the Russians are quite upset by what the IMF and the EU have decided to do. Even Vladimir Putin is loudly denouncing this move…
Russian President Vladimir Putin called the tax “unfair, unprofessional and dangerous,” according to a statement posted on the Kremlin website. Russian companies and individuals have $31 billion of deposits in Cyprus, according to Moody’s.
And you haven’t heard a lot about this in the western media, but the Russians have actually stepped forward and have offered to help Cyprus out of this jam. For example, there are reports that Russian investors are interested in buying the two banks that were the primary cause of this bailout…
Officials have also said Russian investors are interested in buying a majority stake in Cyprus Popular Bank and increasing their holdings in Bank of Cyprus – the two biggest banks on the Mediterranean island.
And according to Sky News, Gazprom has offered Cyprus a very large sum of money for the right to explore their offshore gas reserves that have not been developed yet…
The uncertainty comes as Russia’s finance minister said his country would consider restructuring its loans to Cyprus.
Russian energy giant Gazprom has also reportedly offered financial assistance to Cyprus in exchange for access to the island’s gas reserves.
So far the government of Cyprus has rejected the help of the Russians, but could they change their mind at some point? Apparently the Russians are offering enough money to completely fund the bank bailout…
According Greek Reporter, Gazprom made an offer over the weekend to the Cypriot government to fund the bank restructuring planned under the Cypriot bailout (which is set to cost up to €10bn) in exchange for exclusive exploration rights for Cypriot territorial waters. How reliable this story is remains to be seen, but it does hint at the geopolitical tension which we have been warning about.
Gazprom is known to be very close to the Russian government and despite Russian President Vladimir Putin overtly slamming the deposit tax – calling it “unfair, unprofessional and dangerous” - it is unlikely that they would let this opportunity pass untouched. Fortunately, the Cypriot government is said to have rejected the deal off the bat, but if displeasure towards the eurozone and the EU grows, the Russian option may become increasingly appealing.
It will be very interesting to see what happens.
Meanwhile, some European officials are already suggesting that other nations in southern Europe should have a “wealth tax” imposed upon them. The following comes from an article by Paul Joseph Watson…
Joerg Kraemer, chief economist of the German Commerzbank, has called for private savings accounts in Italy to be similarly plundered. “A tax rate of 15 percent on financial assets would probably be enough to push the Italian government debt to below the critical level of 100 percent of gross domestic product,” he told Handelsblatt.
A “tax” of 15 percent on all financial assets?
Could you imagine if you woke up one morning and the government had decided to suddenly steal 15 percent of all the money that you had in bank accounts, retirement funds and stock portfolios?
If I had a bank account in Italy I would be very nervous right about now.
Under normal circumstances these kinds of things don’t happen, but governments will use an “emergency” to justify all kinds of things. I recently came across an article that included a great quote by Herbert Hoover that put this beautifully…
“Every collectivist revolution rides in on a Trojan horse of ‘emergency’. It was the tactic of Lenin, Hitler, and Mussolini. In the collectivist sweep over a dozen minor countries of Europe, it was the cry of men striving to get on horseback. And ‘emergency’ became the justification of the subsequent steps. This technique of creating emergency is the greatest achievement that demagoguery attains.”
This is what the elite love to do.
They love to create order out of chaos.
And this is just the beginning. The Great Cyprus Bank Robbery was just a beta test for what is coming next.
As the global financial system crumbles, the global elite are going to target our bank accounts, our retirement funds and our stock portfolios. You might want to start thinking about how you will protect yourself.
So what are your thoughts on all of this? Please feel free to post a comment with your thoughts below…
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Gold flows into Dubai as a safe haven and low-cost location for storage
Posted on 04 March 2013
The new Basel III banking regulations that came into force on January 1st have raised the cost of holding unallocated gold in bank vaults and owners are moving their gold holdings to more competitive locations lke the Dubai Multi Commodities Centre, according to a report in The National newspaper.
Officials said there has been a ‘marked increase’ in gold stored and enquiries in recent months. There is also no VAT charged on gold in Dubai and no capital gains tax regime.
Rising taxes in Western nations are a major concern for investors too. In the 1970s, when gold was also in a bull market, musician Mike Oldfield paid 86 per cent of the million pounds he made on his debut album “Tubular Bells’ in tax.
Keeping gold offshore and in a tax-free regime is therefore a sensible precaution, and gold is often held as an insurance policy against tough economic times. In the 1930s the US authorities seized all gold holdings and made it illegal to own it, another fear factor encouraging relocation.
Under the Basel III rules unallocated gold held for customers counts as 100 per cent as a Tier One asset as opposed to 50 per cent presently, and that means that the banks have to charge for the full amount in storage charges and not half of that amount.
The DMCC stores gold in its large vault five storeys underground at its headquarters in Dubai. Its security is so tight that ArabianMoney has never been allowed access. Those who have say gold is stored ‘alongside ingots of silver, cages filled with bags of jewels and cabinets of expensive watches’.
Moving gold to Dubai makes good sense from the point of view of storage costs and the absence of taxation. It is also something of an insurance against things going seriously wrong in the debt-ridden major economies of the world.
Often there are signals to make a move that others later regret not having taken. This could be one of them.
Statistics: Posted by yoda — Mon Mar 04, 2013 12:28 am
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Christopher A. Preble
Will sequestration undermine U.S. national security? Hardly. Today, the Cato Institute released a new infographic putting these minor cuts in perspective.
Military spending will remain at roughly 2006 levels—$603 billion, higher than peak U.S. spending during the Cold War. Meanwhile, we live in a safer world. The Soviet Union has been dead for more than two decades; no other nation, or combination of nations, has emerged since that can pose a comparable threat. We should have a defense budget that reflects this reality.
To be clear, sequestration was no one’s first choice. But the alternative—ever-increasing military spending detached from a legitimate debate over strategy—is worse. We should have had such a debate, one over the roles and missions of the U.S. military, long before this day of reckoning. And politicians could have pursued serious proposals to prudently reduce military spending. Instead, they chose the easy way out, avoiding difficult decisions that would have allowed for smarter cuts.
Until now, there have been few constraints on Washington’s ability to spend what it pleases on the military. As my colleagues Benjamin Friedman and Justin Logan put it, Americans “buy defense like rich people shop, ignoring the balances of costs and benefits.”
Policymakers can’t postpone the tradeoffs forever, especially when the public has grown increasingly weary of foreign entanglements. If forced to choose between higher taxes, less military spending, or lower domestic spending, in order to balance the budget, the military fares least well, with solid pluralities favoring cuts in military spending over cuts in other programs.
Which is why it is so important to get the foreign policy debate right. If we are going to give our military less, we need to think about asking it to do less.
A number of experts have done that, rethinking the military’s purpose, and documenting the savings that would flow from a more modest foreign policy. The sequester is a first step, albeit an imperfect one, that could finally compel policymakers to do the same.
Download and share this infographic on your blog, Twitter, or Facebook.
My thanks go out to Harrison Moar and Zach Graves for conceiving this, pulling the data together, and making it look really cool.
Additional Cato resources on sequestration and military spending:
- “Sequestration Is Still Better than the Alternatives,” by Christopher A. Preble
- “Budgetary Savings from Military Restraint,” by Christopher A. Preble and Benjamin H. Friedman
- “Economic Effects of Reductions in Defense Outlays,” by Benjamin Zycher
- Video: “The Truth about Sequestration”
Infographic sources (in order of figures listed, left to right):
- $6 trillion (current dollars): Congressional Budget Office, “The Budget and Economic Outlook: Fiscal Years 2013 to 2023,” Table 1-5, February 2013, http://www.cbo.gov/sites/default/files/cbofiles/attachments/43907-BudgetOutlook.pdf.
- $500 billion (current dollars): Widely cited approximate figure. See Army Sgt. 1st Class Tyrone C. Marshall, Jr., “Panetta Thanks Congress, Seeks End to Sequestration,” American Forces Press Service, United States Department of Defense, January 2, 2013, http://www.defense.gov/News/newsarticle.aspx?ID=118907; and Editorial, “Defense and the Sequester,” New York Times, February 24, 2013, http://www.nytimes.com/2013/02/25/opinion/defense-and-the-sequester.html?ref=global&_r=0.
- $605 billion (constant FY 2012 dollars): Department of Defense, “Fiscal Year 2012 Green Book,” Table 6-8 – Dept. of Defense BA by Title, March 2011, http://comptroller.defense.gov/budget2012.html. War costs totaled $132 billion.
- $603 billion (current dollars): Congressional Research Service, Memorandum from Amy Belasco, “Potential Effects on Defense Spending of a Year-long Continuing Resolution and the March 2013 Sequesters,” Table 1, February 7, 2013, http://www.pogoarchives.org/straus/CRS-Sequester-20130207.pdf. Figures based on FY 2013 Continuing Resolution. War costs total $82.1 billion.
- $580 billion (constant FY 2012 dollars): Department of Defense, “Fiscal Year 2012 Green Book,” Table 6-8 – Dept. of Defense BA by Title, March 2011, http://comptroller.defense.gov/budget2012.html.
- $560 billion (constant 2012 dollars): State Department,“World Military Expenditures and Arms Transfers: 1989,” Table I, Released October, 1990, http://www.state.gov/t/avc/rls/rpt/wmeat/c50834.htm. Author’s inflationary calculations.
- $111 billion (2010 estimate): International Institute of Strategic Studies, The Military Balance 2012, (London: Routledge, 2012), p.215.
- $65 billion (2010 estimate): International Institute of Strategic Studies, The Military Balance 2012, (London: Routledge, 2012), p.192.
- $12 billion (2011 estimate): International Institute of Strategic Studies, The Military Balance 2012, (London: Routledge, 2012), p. 323.
- $7 billion (2009 estimate): Approximation based on estimated military expenditure as a percentage of GDP from U.S State Department document and CIA World Factbook. State Department, “North Korea Background Note,” April 4, 2012, http://www.state.gov/outofdate/bgn/northkorea/200972.htm; and Central Intelligence Agency, “World Factbook: Korea, North,” https://www.cia.gov/library/publications/the-world-factbook/geos/kn.html.
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Over the years, on my trips to the local bank, I’ve watched people take their valuables to their vault, confident that the small or large safe rented on the premises would be the most secure place they could possibly keep their coin collections, jewels, extra cash, a valuable wine bottle, deeds of trust, a power of attorney, baseball card collection, Grandma’s pearls and diamonds, and many other unusual collector items. Who could possibly have access to their property as long as they had a key and paid their monthly rental dues?
There are those who do not trust banks and their operating hours – they buy expensive home safes, relatively easy to crack, or not-so-secure ones that determined thieves can carry out of the house undisturbed.
How safe are your valuables in the bank? After the 9/11 terrorist attacks, underground vaults in New York affected by the intense heat and smoldering fire that burned for weeks before they were accessed, did not fare so well. Documents were pulverized, pearls burned to a crisp, coin collections, jewelry, and ingots melted into a large mess, and everything else was charred so badly as to not be recognizable. Even Canadian silver ingots stored with the Federal Reserve Bank of New York melted. Heavy security guarded the area until the cache could be recovered safely from the underground caged deposits.
Technically, a bank is a private corporation with shareholders, whose interests are the primary purpose of its existence. A bank exists to make money for its stockholders. The depositors are just an inconvenience, customers whose money is used by bank employees to create more money for the bank and its owners. The depositors must pay a monthly fee for the privilege of lending money to others with little or no return on their deposit if you take into account the inflation rate. Rental safe deposit boxes take up precious space in the bank vault.
There is a plaque in Venice reminding passers-by of the fine and punishment for engaging in usury. Following into the footsteps of a Venetian condemned for usury, I crossed the Bridge of Sighs (tiny windows offered a convicted felon a last view into the gorgeous Venetian bay) from Palazzo dei Dogi, where the court and the Senate were located, into the dungeons of the prigione (prison) – it was a damp, dingy, dark, cold, humbling, and creepy experience.
Banking had become so dishonest that the tiny Venetian city-state ruled by a doge and a Senate, passed a law in 1361 that forbade bankers to use depositors’ money for their own interests – they had to allow the public to inspect ledgers and the actual deposit of coins.
In spite of the mentioned precautions, the bank of Pisano and Tiepolo lent money against reserves and could not meet depositors’ demand for their money in 1584, thus closing. We call this today a run-on-a-bank.
The government established the Banco della Piazza del Rialto (The Bank of the Rialto Square), named after the famous Ponte Rialto (Rialto Bridge) in Venice, one of the commercial points in Venice still in use today. The Banco della Piazza del Rialto was not allowed to make money from lending. “The bank was required to sustain itself solely from fees for coin storage, exchanging currencies, handling of transfer of payments between customers, and notary services.” (G. Edward Griffin, The Creature from Jekyll Island, p. 171)
A second example of honest banking was the Bank of Amsterdam, founded in 1609. G. Edward Griffin also describes the honest Bank of Hamburg as having excess reserves of silver deposits held against bank liabilities when Napoleon Bonaparte took control of the bank in 1813. (The Creature from Jekyll Island, p. 173)
Napoleon did not trust bankers and established the Banque de France (Bank of France), naming himself president. Bank of Prussia became the Reichsbank (the Empire’s Bank). The central bank system such as Reichsbank and Banque de France became very attractive to politicians and billionaires, eventually giving birth to our “central banking system,” the Federal Reserve System (Fed) in 1913.
John Maynard Keynes, the guru of Keynesian economists of the 20th century wrote about Lenin’s criticism of capitalism, “Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method, they not only confiscate, but they confiscate arbitrarily; and while the process impoverishes many, it actually enriches some.”
Lenin, Stalin, Mao, Castro and other past or present communists and Fabian socialists engaged and still do in the same collusive currency debauchery with banks, creating inflation in order to steal wealth from their citizens.
Our own Federal Reserve System is not a bank, is not federal, and is not a reserve. It is a cartel of powerful individuals who have convinced Congress and the public that it is an agency of the United States government. The six men, who met on Jekyll Island, Georgia in 1910 as representatives of one fourth of the world’s wealth, conceived the idea and the blueprint for the Federal Reserve System:
Henry P. Davison, senior partner of J.P. Morgan Company
Benjamin Strong, head of J.P. Morgan’s Bankers Trust Company
Abraham Piatt Andrew, Assistant Secretary of the U.S. Treasury
Nelson W. Aldrich, Republican whip in the Senate, Chairman of the National Monetary Commission, business associate of J.P. Morgan, father-in-law to John D. Rockefeller Jr.
Frank A. Vanderlip, president of the National City Bank of New York, representing William Rockefeller and the international investment bank of Kuhn, Loeb & Co.
Paul M. Warburg, partner in Kuhn, Loeb & Co., representative of the Rothschild banking dynasty in England and France, brother to Max Warburg, head of the Warburg banking in Germany and the Netherlands (G. Edward Griffin, The Creature from Jekyll Island, p. 5)
Nationalization of banks or other companies can happen with or without compensation to the owners. For example, in 1945, the French government seized Renault, a car maker, because the owners had collaborated with the Nazi occupiers. GM was “saved from bankruptcy” by our government with minimal compensation to the bondholders and stockholders who had prior-claim and should have received a more adequate compensation.
Citizens in the former communist countries had their possessions confiscated by the Communist Party elites who took over assets and wealth, declared it patrimony of the state, and proceeded to distribute it amongst the party apparatchiks. If bank vaults contained valuables, and they did, the contents became the property of the state overnight.
U.S. President Franklin D. Roosevelt signed Executive Order 6102 on April 5, 1933, “forbidding the hoarding of gold coin, gold bullion, and gold certificates within the continental United States” by any individual, partnership, association, or corporation. Such had to be turned over to the Federal Reserve in exchange for $20.67 per troy ounce ($371.10 in 2010 dollars). People did lose money because the Treasury raised the price of gold for international transactions to $35 ($587 in 2010 dollars), an immediate loss for all citizens who had to surrender their gold for less under the penalty of a $10,000 fine and/or 5-10 years in jail. The profit that the Treasury made financed the Exchange Stabilization Fund established by the Gold Reserve Act of 1934.
This begs the question, are your valuables safe in a deposit box at your bank? Safe deposit boxes were not searched or seized by force, however, in prosecution cases gold was seized from safe deposit boxes with a search warrant.
Zelik Josefowitz, who was not an American citizen, was prosecuted for tax evasion and his 10,000 troy ounces of gold confiscated. Estimates of gold seizure/forced sale range from 56 tons (1.8 million ounces) to 500 tons based on U.S. Treasury data and Milton Friedman’s book, “The Monetary History of the United States.”
When a bank fails, the U.S. Treasury receives the safe deposit boxes
When a bank fails, the U.S. Treasury receives the safe deposit boxes. Three thousand banks failed during the 1930s. If nobody claimed a box, it remained in the custody of the Treasury. There are 1,605 cartons in the basement of the Treasury with the contents of unclaimed safe deposit boxes. (Wall Street Journal, October 15, 1981)
Venezuelan dictator Cipriano Castro borrowed money at the turn of the 20th century and refused to pay it back. The creditors, Britain, Italy, and Germany demanded repayment. When Cipriano Castro refused, the three countries sent warships to shell Venezuela’s forts and blockaded its ports until Caracas paid its debt.
Is there a possibility that an executive order may affect or confiscate wealth stored in banks if our economy becomes a national crisis and we default on the national debt? That is a very good question which is worth pondering in times when our government has borrowed so much money in the last four years that it will take generations of Americans to repay the debt.
Statistics: Posted by yoda — Sat Sep 01, 2012 2:26 am
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Australia – $2 billion farm investment04 Jun 2012
A NEW company, TIAA-CREF Global Agriculture LLC, has completed a raising of $US2 billion to be invested in farmland in the United States, Australia and Brazil.
Early yesterday it said it had the backing of several major institutional investors such as the Swedish pension fund AP2, British Columbia Investment Management Corporation and the Caisse de dépôt et placement du Québec – one of the largest real estate managers in the world.
As the European debt crisis continues to rattle equity markets around the world, farmland is being seen as a safe haven for pension funds.
Caisse executive vice-president for private equity Normand Provost said the timing was right to deploy capital into this asset class. "Farmland presents a risk-return profile that meets our depositors’ objectives and that offers portfolio diversification," Mr Provost said. "This investment marks the Caisse’s entry into an emerging asset class, which will facilitate its exposure to the global demand for agricultural products."
The Australian Financial Review
Statistics: Posted by yoda — Sun Jun 03, 2012 10:39 pm
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Last week brought worrying signs, though, that while the eurozone’s woes are not easing, ongoing concerns about monetary union are now having an impact on alternative growth centres, too, imposing real damage on commercial activity in other parts of the globe.
For most of the past year, of course, the eurozone has been on the verge of a full-blown economic collapse.
Investor angst has further intensified in recent weeks, since inconclusive Greek elections on May 6. It is now widely accepted that Greece could be thrown out of the euro if it keeps thumbing its nose at the austerity measures imposed by the member states bankrolling Athens’s continued sovereign bail-out.
The possibility of a Greek exit, and the related contagion if investors lost faith in the solvency and future membership of other single currency “peripherals”, is taking its toll on the region’s real economy. The eurozone’s manufacturing purchasing managers’ index plummeted to 45.1 in May, well below the 50-point level that indicates growth. After 10 straight months of contraction, this marked a three-year low.
The French manufacturing PMI slid from 46.9 to 44.7 last month, its Spanish equivalent from 43.5 to 42. Even Germany’s index faded to 45.2 from 46.2 in April, its lowest level since June 2009, the trough of the post-Lehman doldrums.
Peter Oppenheimer, Chief Global Equity Strategist at Goldman Sachs, on how the UK would suffer if Greece left the eurozone
Little wonder, then, that eurozone unemployment just hit 11pc, a euro-era high. Spanish unemployment is an intolerable 24pc — the kind of level that could spark not just protests but serious civil unrest.
As the economic and political pressure mounts, financial markets are showing signs of acute strain. Spain’s 10-year sovereign bond yield is once again approaching an unsustainable 7pc, its Italian equivalent back above 6pc.
As the Eurocrats toy with “Grexit”, Spain is trying to plug holes in regional budgets, while defusing the incendiary off-balance sheet liabilities of its rancid banking sector.
For now, Madrid needs a quick €19bn to recapitalise Spain’s fourth biggest bank. But investors are starting to realise that when it comes to the eurozone’s fourth-biggest economy, an economy perhaps “too big to bail”, Bankia is just the tip of the liability iceberg. As such, the euro tumbled below $1.23 last week, to a 23-month low, with the Stoxx Europe 600 equity index giving up all its 2012 gains.
What also happened last week, though, was that the macro-data alarm bells began ringing so loudly elsewhere — particularly in the US and China — that they can no longer be ignored.
So global investors are now focusing not just on the potential financial impact of Europe’s troubles — via contagion if there’s another “Minsky moment” — but on the real economic damage already being caused elsewhere by the eurozone’s current paralysis.
The US is spluttering badly. The country’s bellwether “payrolls report” showed only 69,000 new jobs in May, well below market expectations of 150,000-plus. The figure for April was revised down from 115,000 to 77,000. America’s first-quarter GDP growth, meanwhile, having been marked at 2.2pc, was downgraded to 1.9pc. The Dow Jones Industrial Average, like its eurozone equivalent, is now at its lowest point this year.
So that leaves China, although the People’s Republic is suffering too because the eurozone is its biggest market, buying a fifth of all Chinese goods exports.
In May, China’s manufacturing PMI fell from 53.3 to 50.4 — its seventh successive monthly contraction. Real estate prices, the store of wealth for much of China’s middle-class, are now at a 16-month low. China grew by 7.9pc during the first three months of 2012, but this marked the sixth successive quarterly deceleration. Full-year GDP growth is on course to hit its lowest level since 1999.
Last month, China’s central bank lowered reserve ratios by 50 basis points, the third cut in six months, in a bid to boost the economy.
But investors have lately been spooked by signs that Beijing is reluctant to really whack the “stimulus button”.
In 2008, the Chinese government rushed to spend its way out of trouble, using reserves rather than more borrowing of course, in stark contrast to the Western world.
The massive four trillion yuan package, then equivalent to $590bn, did the trick in terms of growth. Yet the lending boom it unleashed has raised fears of a bad-loan crisis, with China, uniquely among the large emerging markets, now seen as a candidate for a subprime crisis of its own.
“Current efforts for stabilising growth will not repeat the old way of three years ago,” boomed the state-run Xinhua newspaper last week. The fact that even China, with its $1.5 trillion of reserves, is worried about launching another mega bail-out should focus the minds of even the most determined optimists.
Back in the 1970s, the eurozone economies, then among the most dynamic on earth, generated 20pc of global growth. Over the past decade, this growth share has fallen to 5pc. Yet the single currency area still accounts for more than a fifth of the global economy.
More fundamentally, the region’s banking sector is so distressed, and many of its governments so close to insolvency, that “eurogeddon” could spark a worldwide shockwave every bit as damaging as Lehman. And this time, of course, there is far less scope for fiscal and monetary bail-outs – not only in Europe, but in the US and elsewhere, too.
Of course, the UK, already in recession and reliant on the eurozone to buy more than half its exports, is among the most seriously exposed. In May, Britain’s manufacturing PMI index nosedived to 45.9, the weakest reading since May 2009, down from 50.2 the month before. This marked the second biggest one-month drop in 20 years.
Global markets are clearly skittish. The only thing that has stopped asset prices falling further, perhaps, is the belief that escalating market turmoil could push central banks into action – not just the ECB, but the Bank of England and Federal Reserve, too. That’s why gold prices are firming up once again. It’s also why the dollar index, typically inversely correlated with investor risk appetite, has lately shown signs of reversal.
While the prospect of more QE has helped some “risk assets” in recent days, most investors are scrambling for “safety”. So 10-year US sovereign borrowing costs have fallen to a record low and gilt yields are at rock bottom, too. On some two-year German government bonds, yields went negative last week, with investors so desperate for a perceived “haven” that they’re willing to pay for the privilege of lending Berlin money.
We must ask ourselves though, as the global macro data deteriorates and the Eurocrats keep squabbling, are the “safe havens” really safe? The US and Germany, as well as the UK, have government debt-to-GDP ratios approaching 100pc, even more including off-balance sheets liabilities.
With the Fed now poised to unleash QE3, more Bank of England money-printing on the cards and even Germany now openly calling for more inflation, real-terms losses, even on relatively short-term “safe” government paper, are practically guaranteed. And that’s assuming that the US, Germany and UK can manage to limit the damage to relatively low-impact “soft default” over the coming months and years, avoiding the horrors of an all-out creditors’ strike.
When the safe havens are no longer seen as safe, that is the moment when genuine panic ensues. A question worth pondering, perhaps, as we approach the pivotal Greek election rerun on June 17.
Statistics: Posted by yoda — Sun Jun 03, 2012 12:31 am
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Two years later, sick fish found near BP oil spill site
By Cain Burdeau, Associated Press Updated 5h 13m ago
BARATARIA BAY, La. – Open sores. Parasitic infections. Chewed-up-looking fins. Gashes. Mysterious black streaks. Two years after the drilling-rig explosion that touched off the biggest offshore oil spill in U.S. history, scientists are beginning to suspect that fish in the Gulf of Mexico are suffering the effects of the petroleum.
The evidence is nowhere near conclusive. But if those suspicions prove correct, it could mean that the environmental damage to the Gulf from the BP disaster is still unfolding and the picture isn’t as rosy as it might have seemed just a year ago.
And the damage may extend well beyond fish. In the past year, research has emerged showing deep-water coral, seaweed beds, dolphins, mangroves and other species of plants and animals are suffering.
"There is lots of circumstantial evidence that something is still awry," said Christopher D’Elia, dean of Louisiana State University’s School of the Coast and Environment. "On the whole, it is not as much environmental damage as originally projected. Doesn’t mean there is none."
Reports of strange things with fish began emerging when fishermen returned to the Gulf weeks after BP’s gushing oil well was capped during the summer of 2010. They started catching grouper and red snapper with large open sores and strange black streaks, lesions they said they had never seen. They promptly blamed the spill.
The illnesses are not believed to pose any health threat to humans. But the problems could be devastating to some prized types of fish and to the people who make their living catching them.
There’s no saying for sure what’s causing the diseases in what is still a relatively small percentage of the fish. The Gulf is assaulted with all kinds of contaminants every day. Moreover, scientists have no baseline data on sick fish in the Gulf from before the spill. The first comprehensive research may be years from publication.
Still, it’s clear to fishermen and researchers alike that something’s amiss.
• A recent batch of test results revealed the presence of oil in the bile extracted from fish caught in August 2011, nearly 15 months after the well blew out on April 20, 2010, in a disaster that killed 11 men.
"Bile tells you what a fish’s last meal was," said Steve Murawski, a marine biologist with the University of South Florida and former chief science adviser for the National Marine Fisheries Service. "There was as late as August of last year an oil source out there that some of those animals were consuming."
Bile in red snapper, yellow-edge grouper and a few other species contained on average 125 parts per million of naphthalene, a compound in crude oil, Murawski said. Scientists expect to find almost none of the substance in fish captured in the open ocean.
• Last summer, a federally funded team of scientists conducted what experts say is the most extensive study yet of sick fish in shallow and deep Gulf waters. Over seven cruises in July and August, the scientists caught about 4,000 fish, from Florida’s Dry Tortugas to Louisiana.
About 3% of the fish had gashes, ulcers and parasites symptomatic of environmental contamination, according to Murawski, the lead researcher. The number of sick fish rose as scientists moved west away from the relatively clean waters of Florida, and also as they pushed into deeper waters off Alabama, Mississippi and especially Louisiana, near where the Deepwater Horizon rig sank.
About 10% of mud-dwelling tile fish caught in the DeSoto Canyon, to the northeast of the well, showed signs of sickness.
"The closer to the oil rig, the higher the frequency was" of sick fish, Murawski said.
Past studies off the Atlantic Seaboard found about 1 percent of fish suffering from diseases, Murawski said. But he said that figure cannot really be used for comparisons with the Gulf, whose warmer waters serve as an incubator for bacteria and parasites that can cause lesions and other illnesses.
• Laboratory work over the past winter on the USF samples indicates the immune systems of the fish were impaired by an unknown environmental stress or contamination. Other researchers say they have come to similar conclusions.
"Some of the things I’ve seen over the past year or so I’ve never seen before," said Will Patterson, a marine biologist at the University of South Alabama and at the Dauphin Island Sea Lab. "Things like fin rot, large open sores on fish, those were some of the more disturbing types of things we saw. Different changes in pigment, red snapper with large black streaks on them."
Teasing out what might have been caused by the spill and what is normal will be tricky, and that’s the challenge scientists now face. Deformities, diseases and sudden shifts in fish numbers are regular occurrences in nature. For example, scientists are not sure what to make of reports from fishermen of eyeless or otherwise deformed shrimp and crabs.
"I’ve heard everything but shrimp with two heads," said Jerald Horst, a marine biologist retired from LSU AgCenter who writes books about the Gulf. "I listen respectfully. Reports can be useful but are not proof in themselves of cause and effect."
Even if oil were pinpointed as the cause, it could be difficult to definitively tie the problem to the BP spill. The Gulf is strewn with wells, pipelines, natural oil leaks from the seafloor, and pollution from passing ships. And muddy, contaminant-laden water flows constantly into the Gulf from the Mississippi River.
Still, the more scientists look — thanks to millions of dollars in research money, much of it coming from a fund set up by BP for independent research — the more they’re finding that may be off-kilter.
For example, last year scientists with the University of Louisiana at Lafayette took cruises in search of crabs, lobsters and seaweed they had been studying in the waters not far from the BP well. They found a surprising lack of diversity.
There saw less seaweed and fewer crabs, lobsters and other forms of life. Also, crustaceans they pulled up had lesions, lost appendages and black gunk on their gills, said Darryl Felder, a biologist at ULL. He said the black coating may be associated with the large amounts of drilling mud used to try to plug the leaking well.
In Barataria Bay, which was hit hard by the spill, scientists say they found dolphins that were anemic and showing signs of liver and lung disease. Those problems have not been linked to the spill. But in the same bay, scientists say they have linked oil contamination to genetic changes in bait fish known as killifish.
Near the BP well, scientists have found a dying community of deep-sea coral. The scientists recently published findings linking its demise to oil that was chemically fingerprinted as having come from the BP well.
Last year, the National Oceanic and Atmospheric Administration advised fishermen to throw suspicious-looking fish back, and fishermen say they have been doing that. At the same time, the Food and Drug Administration and state agencies say they have tested Gulf seafood extensively and found no problems, and researchers agree there is little cause for concern.
"It’s not a people issue, and people should not be concerned about fish entering the market," Murawski said.
For the second year, fishermen like Wayne Werner, who catches red snapper commercially, are calling in with reports of lesions. He and others said they want to get to the bottom of the problem, which is forcing them to take longer trips to fishing spots outside the spill zone and making them fear for their livelihoods.
"Every time we talked about bad fish, everybody kind of went nuts on us. Just like, ‘You’re hearsaying,’ you know? And we’re saying, ‘Well, they’re there,’" the Louisiana boat captain said this week. "They’re still there. Now that the water is getting warm again, we’re starting to see more and more again."
Statistics: Posted by yoda — Thu Apr 19, 2012 11:11 pm
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OF COURSE IT’S SAFE TO EAT
Posted on 19th April 2012 by Administrator in Economy |Politics |Social Issues
BP, EPA, GULF oil spill
I’m sure our government wouldn’t let us eat toxic deformed seafood. BP and the EPA say it’s safe. Of course we should believe them. Why would they lie?
Hat tip to Tampa Gold for sending the article.
Gulf seafood deformities alarm scientists
Eyeless shrimp and fish with lesions are becoming common, with BP oil pollution believed to be the likely cause.
Dahr Jamail Last Modified: 18 Apr 2012 03:16
New Orleans, LA- “The fishermen have never seen anything like this,” Dr Jim Cowan told Al Jazeera. “And in my 20 years working on red snapper, looking at somewhere between 20 and 30,000 fish, I’ve never seen anything like this either.”Dr Cowan, with Louisiana State University’s Department of Oceanography and Coastal Sciences started hearing about fish with sores and lesions from fishermen in November 2010.
Cowan’s findings replicate those of others living along vast areas of the Gulf Coast that have been impacted by BP’s oil and dispersants.
Gulf of Mexico fishermen, scientists and seafood processors have told Al Jazeera they are finding disturbing numbers of mutated shrimp, crab and fish that they believe are deformed by chemicals released during BP’s 2010 oil disaster.
Along with collapsing fisheries, signs of malignant impact on the regional ecosystem are ominous: horribly mutated shrimp, fish with oozing sores, underdeveloped blue crabs lacking claws, eyeless crabs and shrimp – and interviewees’ fingers point towards BP’s oil pollution disaster as being the cause.
Tracy Kuhns and her husband Mike Roberts, commercial fishers from Barataria, Louisiana, are finding eyeless shrimp.
“At the height of the last white shrimp season, in September, one of our friends caught 400 pounds of these,” Kuhns told Al Jazeera while showing a sample of the eyeless shrimp.
According to Kuhns, at least 50 per cent of the shrimp caught in that period in Barataria Bay, a popular shrimping area that was heavily impacted by BP’s oil and dispersants, were eyeless. Kuhns added: “Disturbingly, not only do the shrimp lack eyes, they even lack eye sockets.”
Eyeless shrimp, from a catch of 400 pounds of eyeless shrimp, said to be caught September 22, 2011, in Barataria Bay, Louisiana [Erika Blumenfeld/Al Jazeera]
“Some shrimpers are catching these out in the open Gulf [of Mexico],” she added, “They are also catching them in Alabama and Mississippi. We are also finding eyeless crabs, crabs with their shells soft instead of hard, full grown crabs that are one-fifth their normal size, clawless crabs, and crabs with shells that don’t have their usual spikes … they look like they’ve been burned off by chemicals.”
On April 20, 2010, BP’s Deepwater Horizon oilrig exploded, and began the release of at least 4.9 million barrels of oil. BP then used at least 1.9 million gallons of toxic Corexit dispersants to sink the oil.
Keath Ladner, a third generation seafood processor in Hancock County, Mississippi, is also disturbed by what he is seeing.
“I’ve seen the brown shrimp catch drop by two-thirds, and so far the white shrimp have been wiped out,” Ladner told Al Jazeera. “The shrimp are immune compromised. We are finding shrimp with tumors on their heads, and are seeing this everyday.”
While on a shrimp boat in Mobile Bay with Sidney Schwartz, the fourth-generation fisherman said that he had seen shrimp with defects on their gills, and “their shells missing around their gills and head”.
“We’ve fished here all our lives and have never seen anything like this,” he added.
Ladner has also seen crates of blue crabs, all of which were lacking at least one of their claws.
Darla Rooks, a lifelong fisherperson from Port Sulfur, Louisiana, told Al Jazeera she is finding crabs “with holes in their shells, shells with all the points burned off so all the spikes on their shells and claws are gone, misshapen shells, and crabs that are dying from within … they are still alive, but you open them up and they smell like they’ve been dead for a week”.
Rooks is also finding eyeless shrimp, shrimp with abnormal growths, female shrimp with their babies still attached to them, and shrimp with oiled gills.
“We also seeing eyeless fish, and fish lacking even eye-sockets, and fish with lesions, fish without covers over their gills, and others with large pink masses hanging off their eyes and gills.”
Rooks, who grew up fishing with her parents, said she had never seen such things in these waters, and her seafood catch last year was “ten per cent what it normally is”.
“I’ve never seen this,” he said, a statement Al Jazeera heard from every scientist, fisherman, and seafood processor we spoke with about the seafood deformities.
Given that the Gulf of Mexico provides more than 40 per cent of all the seafood caught in the continental US, this phenomenon does not bode well for the region, or the country.
“The dispersants used in BP’s draconian experiment contain solvents, such as petroleum distillates and 2-butoxyethanol. Solvents dissolve oil, grease, and rubber,” Dr Riki Ott, a toxicologist, marine biologist and Exxon Valdez survivor told Al Jazeera. “It should be no surprise that solvents are also notoriously toxic to people, something the medical community has long known”.
The dispersants are known to be mutagenic, a disturbing fact that could be evidenced in the seafood deformities. Shrimp, for example, have a life-cycle short enough that two to three generations have existed since BP’s disaster began, giving the chemicals time to enter the genome.
Pathways of exposure to the dispersants are inhalation, ingestion, skin, and eye contact. Health impacts can include headaches, vomiting, diarrhea, abdominal pains, chest pains, respiratory system damage, skin sensitisation, hypertension, central nervous system depression, neurotoxic effects, cardiac arrhythmia and cardiovascular damage. They are also teratogenic – able to disturb the growth and development of an embryo or fetus – and carcinogenic.
Cowan believes chemicals named polycyclic aromatic hydrocarbons (PAHs), released from BP’s submerged oil, are likely to blame for what he is finding, due to the fact that the fish with lesions he is finding are from “a wide spatial distribution that is spatially coordinated with oil from the Deepwater Horizon, both surface oil and subsurface oil. A lot of the oil that impacted Louisiana was also in subsurface plumes, and we think there is a lot of it remaining on the seafloor”.
Marine scientist Samantha Joye of the University of Georgia published results of her submarine dives around the source area of BP’s oil disaster in the Nature Geoscience journal.
Her evidence showed massive swathes of oil covering the seafloor, including photos of oil-covered bottom dwelling sea creatures.
While showing slides at an American Association for the Advancement of Science annual conference in Washington, Joye said: “This is Macondo oil on the bottom. These are dead organisms because of oil being deposited on their heads.”
Dr Wilma Subra, a chemist and Macarthur Fellow, has conducted tests on seafood and sediment samples along the Gulf for chemicals present in BP’s crude oil and toxic dispersants.
“Tests have shown significant levels of oil pollution in oysters and crabs along the Louisiana coastline,” Subra told Al Jazeera. “We have also found high levels of hydrocarbons in the soil and vegetation.”
According to the US Environmental Protection Agency, PAHs “are a group of semi-volatile organic compounds that are present in crude oil that has spent time in the ocean and eventually reaches shore, and can be formed when oil is burned”.
“The fish are being exposed to PAHs, and I was able to find several references that list the same symptoms in fish after the Exxon Valdez spill, as well as other lab experiments,” explained Cowan. “There was also a paper published by some LSU scientists that PAH exposure has effects on the genome.”
The University of South Florida released the results of a survey whose findings corresponded with Cowan’s: a two to five per cent infection rate in the same oil impact areas, and not just with red snapper, but with more than 20 species of fish with lesions. In many locations, 20 per cent of the fish had lesions, and later sampling expeditions found areas where, alarmingly, 50 per cent of the fish had them.
“I asked a NOAA [National Oceanic and Atmospheric Administration] sampler what percentage of fish they find with sores prior to 2010, and it’s one tenth of one percent,” Cowan said. “Which is what we found prior to 2010 as well. But nothing like we’ve seen with these secondary infections and at this high of rate since the spill.”
“What we think is that it’s attributable to chronic exposure to PAHs released in the process of weathering of oil on the seafloor,” Cowan said. “There’s no other thing we can use to explain this phenomenon. We’ve never seen anything like this before.”
Questions raised by Al Jazeera’s investigation remain largely unanswered.
Al Jazeera contacted the office of Louisiana governor Bobby Jindal, who provided a statement that said the state continues to test its waters for oil and dispersants, and that it is testing for PAHs.
“Gulf seafood has consistently tested lower than the safety thresholds established by the FDA for the levels of oil and dispersant contamination that would pose a risk to human health,” the statement reads. “Louisiana seafood continues to go through extensive testing to ensure that seafood is safe for human consumption. More than 3,000 composite samples of seafood, sediment and water have been tested in Louisiana since the start of the spill.”
Signs of the impact on the regional ecosystem are ominous – and scientists and fishermen point fingers towards BP’s oil as being the cause [Keath Ladner]
At the federal government level, the Food and Drug Administration and Environmental Protection Agency – both federal agencies which have powers in the this area – insisted Al Jazeera talk with the National Oceanic and Atmospheric Administration (NOAA).
NOAA won’t comment to the media because its involvement in collecting information for an ongoing lawsuit against BP.
BP refused Al Jazeera’s request to comment on this issue for a television interview, but provided a statement that read:
“Seafood from the Gulf of Mexico is among the most tested in the world, and, according to the FDA and NOAA, it is as safe now as it was before the accident.”
BP claims that fish lesions are common, and that prior to the Deepwater Horizon accident there was documented evidence of lesions in the Gulf of Mexico caused by parasites and other agents.
The oil giant added:
“As part of the Natural Resource Damage Assessment, which is led by state and federal trustees, we are investigating the extent of injury to natural resources due to the accident.
“BP is funding multiple lines of scientific investigation to evaluate potential damage to fish, and these include: extensive seafood testing programs by the Gulf states; fish population monitoring conducted by the Louisiana Department of Wildlife and Fisheries, Auburn University and others; habitat and water quality monitoring by NOAA; and toxicity tests on regional species. The state and federal Trustees will complete an injury assessment and the need for environmental restoration will be determined.”
Before and after
But evidence of ongoing contamination continues to mount.
Crustacean biologist Darryl Felder, in the Department of Biology with the University of Louisiana at Lafayette is in a unique position.
Felder has been monitoring the vicinity of BP’s blowout Macondo well both before and after the oil disaster began, because, as he told Al Jazeera, “the National Science Foundation was interested in these areas that are vulnerable due to all the drilling”.
“So we have before and after samples to compare to,” he added. “We have found seafood with lesions, missing appendages, and other abnormalities.”
Felder also has samples of inshore crabs with lesions. “Right here in Grand Isle we see lesions that are eroding down through their shell. We just got these samples last Thursday and are studying them now, because we have no idea what else to link this to as far as a natural event.”
According to Felder, there is an even higher incidence of shell disease with crabs in deeper waters.
“My fear is that these prior incidents of lesions might be traceable to microbes, and my questions are, did we alter microbial populations in the vicinity of the well by introducing this massive amount of petroleum and in so doing cause microbes to attack things other than oil?”
One hypothesis he has is that the waxy coatings around crab shells are being impaired by anthropogenic chemicals or microbes resulting from such chemicals.
“You create a site where a lesion can occur, and microbes attack. We see them with big black lesions, around where their appendages fall off, and all that is left is a big black ring.”
Felder added that his team is continuing to document the incidents: “And from what we can tell, there is a far higher incidence we’re finding after the spill.”
“We are also seeing much lower diversity of crustaceans,” he said. “We don’t have the same number of species as we did before [the spill].”
[Continues below the slideshow]
Felder has tested his samples for oil, but not found many cases where hydrocarbon traces tested positive. Instead, he believes what he is seeing in the deepwater around BP’s well is caused from the “huge amount” of drilling mud used during the effort to stop the gushing well.
“I was collecting deepwater shrimp with lesions on the side of their carapace. Under the lesions, the gills were black. The organ that propels the water through the gills, it too was jet-black. That impairs respiratory ability, and has a negative effect on them. It wasn’t hydrocarbons, but is largely manganese precipitates, which is really odd. There was a tremendous amount of drilling mud pumped out with Macondo, so this could be a link.”
Some drilling mud and oil well cement slurries used on oil extraction rigs contains up to 90 per cent by weight of manganomanganic (manganese) oxide particles.
Felder is also finding “odd staining” of animals that burrow into the mud that cause stain rings, and said: “It is consistently mineral deposits, possibly from microbial populations in [overly] high concentrations.”
A direct link
Dr Andrew Whitehead, an associate professor of biology at Louisiana State University, co-authored the report Genomic and physiological footprint of the Deepwater Horizon oil spill on resident marsh fishes that was published in the journal Proceedings of the National Academy of Sciences in October 2011.
Whitehead’s work is of critical importance, as it shows a direct link between BP’s oil and the negative impacts on the Gulf’s food web evidenced by studies on killifish before, during and after the oil disaster.
“What we found is a very clear, genome-wide signal, a very clear signal of exposure to the toxic components of oil that coincided with the timing and the locations of the oil,” Whitehead told Al Jazeera during an interview in his lab.
According to Whitehead, the killifish is an important indicator species because they are the most abundant fish in the marshes, and are known to be the most important forage animal in their communities.
“That means that most of the large fish that we like to eat and that these are important fisheries for, actually feed on the killifish,” he explained. “So if there were to be a big impact on those animals, then there would probably be a cascading effect throughout the food web. I can’t think of a worse animal to knock out of the food chain than the killifish.”
But we may well be witnessing the beginnings of this worst-case scenario.
Whitehead is predicting that there could be reproductive impacts on the fish, and since the killifish is a “keystone” species in the food web of the marsh, “Impacts on those species are more than likely going to propagate out and effect other species. What this shows is a very direct link from exposure to DWH oil and a clear biological effect. And a clear biological effect that could translate to population level long-term consequences.”
Back on shore, troubled by what he had been seeing, Keath Ladner met with officials from the US Food and Drug Administration and asked them to promise that the government would protect him from litigation if someone was made sick from eating his seafood.
“They wouldn’t do it,” he said.
“I’m worried about the entire seafood industry of the Gulf being on the way out,” he added grimly.
‘Tar balls in their crab traps’
Ed Cake, a biological oceanographer, as well as a marine and oyster biologist, has “great concern” about the hundreds of dolphin deaths he has seen in the region since BP’s disaster began, which he feels are likely directly related to the BP oil disaster.
“Adult dolphins’ systems are picking up whatever is in the system out there, and we know the oil is out there and working its way up the food chain through the food web – and dolphins are at the top of that food chain.”
Cake explained: “The chemicals then move into their lipids, fat, and then when they are pregnant, their young rely on this fat, and so it’s no wonder dolphins are having developmental issues and still births.”
Cake, who lives in Mississippi, added: “It has been more than 33 years since the 1979 Ixtoc-1 oil disaster in Mexico’s Bay of Campeche, and the oysters, clams, and mangrove forests have still not recovered in their oiled habitats in seaside estuaries of the Yucatan Peninsula. It has been 23 years since the 1989 Exxon Valdez oil disaster in Alaska, and the herring fishery that failed in the wake of that disaster has still not returned.”
Cake believes we are still in the short-term impact stage of BP’s oil disaster.
“I will not be alive to see the Gulf of Mexico recover,” said Cake, who is 72 years old. “Without funding and serious commitment, these things will not come back to pre-April 2010 levels for decades.”
The physical signs of the disaster continue.
“We’re continuing to pull up oil in our nets,” Rooks said. “Think about losing everything that makes you happy, because that is exactly what happens when someone spills oil and sprays dispersants on it. People who live here know better than to swim in or eat what comes out of our waters.”
Khuns and her husband told Al Jazeera that fishermen continue to regularly find tar balls in their crab traps, and hundreds of pounds of tar balls continue to be found on beaches across the region on a daily basis.
Meanwhile Cowan continues his work, and remains concerned about what he is finding.
“We’ve also seen a decrease in biodiversity in fisheries in certain areas. We believe we are now seeing another outbreak of incidence increasing, and this makes sense, since waters are starting to warm again, so bacterial infections are really starting to take off again. We think this is a problem that will persist for as long as the oil is stored on the seafloor.”
Felder wants to continue his studies, but now is up against insufficient funding.
Regarding his funding, Cowan told Al Jazeera: “We are up against social and economic challenges that hamper our ability to get our information out, so the politics have been as daunting as the problem [we are studying] itself. But my funding is not coming from a source that requires me to be quiet.”
Statistics: Posted by yoda — Thu Apr 19, 2012 1:24 pm
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