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	<title>FrontPage Magazine &#187; Banks</title>
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		<title>Obama&#8217;s &#8216;Operation Choke Point&#8217;</title>
		<link>http://www.frontpagemag.com/2014/arnold-ahlert/obamas-operation-choke-point/?utm_source=rss&#038;utm_medium=rss&#038;utm_campaign=obamas-operation-choke-point</link>
		<comments>http://www.frontpagemag.com/2014/arnold-ahlert/obamas-operation-choke-point/#comments</comments>
		<pubDate>Thu, 18 Dec 2014 05:40:42 +0000</pubDate>
		<dc:creator><![CDATA[Arnold Ahlert]]></dc:creator>
				<category><![CDATA[Daily Mailer]]></category>
		<category><![CDATA[FrontPage]]></category>
		<category><![CDATA[Banks]]></category>
		<category><![CDATA[Discrimination]]></category>
		<category><![CDATA[FDIC]]></category>
		<category><![CDATA[gun manufacturer]]></category>
		<category><![CDATA[operation choke point]]></category>

		<guid isPermaLink="false">http://www.frontpagemag.com/?p=247698</guid>
		<description><![CDATA[Why the administration's crusade against lawful U.S. businesses won't be discontinued anytime soon.  ]]></description>
				<content:encoded><![CDATA[<p style="color: #232323;"><a href="http://cdn.frontpagemag.com/wp-content/uploads/2014/12/fdic.png"><img class="alignleft  wp-image-247700" src="http://cdn.frontpagemag.com/wp-content/uploads/2014/12/fdic-450x310.png" alt="fdic" width="350" height="241" /></a>Almost unbelievably, the Obama administration is involved in another scandalous abuse of power, one that has largely escaped the public’s attention. The House Oversight and Government Reform Committee released a <a href="http://oversight.house.gov/wp-content/uploads/2014/12/Staff-Report-FDIC-and-Operation-Choke-Point-12-8-2014.pdf"><span style="color: #1255cc;">report</span></a> December 8 detailing the abuses by the Federal Deposit Insurance Corporation (FDIC), operating under the auspices of a program known as Operation Choke Point. Run by the Departments of Justice and Treasury, Operation Choke Point was supposed to target illegal businesses and prevent them from obtaining access to the U.S. financial system. Yet damning emails unearthed by investigators <a href="http://dailysignal.com/2014/12/08/these-7-revealing-emails-show-federal-agencies-scheming-to-target-legal-businesses/"><span style="color: #1255cc;">reveal</span></a> regulatory officials were motivated by personal animus toward certain businesses. “It’s appalling that our government is working around the law to vindictively attack businesses they find objectionable,” Rep. Darrell Issa (R-CA), Chairman of the House Oversight and Government Reform Committee, said in a press release.</p>
<p style="color: #232323;">&#8220;Internal FDIC documents confirm that Operation Choke Point is an extraordinary abuse of government power,” Issa. &#8220;In the most egregious cases, federal bureaucrats injected personal moral judgments into the regulatory process. Such practices are totally inconsistent with basic principles of good government, transparency and the rule of law.”</p>
<p style="color: #232323;">Operation Choke Point was <a href="http://www.justice.gov/opa/speech/financial-fraud-enforcement-task-force-executive-director-michael-j-bresnick-exchequer"><span style="color: #1255cc;">publicly introduced</span></a> in March of 2013, when Financial Fraud Enforcement Task Force Executive Director Michael J. Bresnickat bought it up in a speech at Washington D.C.’s Exchequer Club. Bresnickat assured his audience the reason the program was &#8220;focused on financial institutions and payment processors is because they are the so-called bottlenecks, or choke-points, in the fraud committed by so many merchants that victimize consumers and launder their illegal proceeds.”</p>
<p style="color: #232323;">Five months later, the <i>Wall Street Journal</i> <a href="http://www.wsj.com/articles/SB10001424127887323838204578654411043000772"><span style="color: #1255cc;">revealed</span></a> the troubling reality that one of the first targets of the program were payday lending operations. Peter Barden, spokesman for the Online Lenders Alliance, sounded the initial warning, noting government pressure forcing banks to stop payment processing &#8220;would cut off an important credit choice for millions of underserved consumers&#8221; and &#8220;send a troubling message to banks that at any point regulators can force them to stop processing legal transactions simply because they don&#8217;t like a particular merchant or industry.”</p>
<p style="color: #232323;">In January 2014, Issa, along with Economic Growth Subcommittee Chairman Rep. Jim Jordan (R-OH), sent U.S. Attorney General Eric Holder a letter expressing concern that &#8220;both the goal and mechanisms of Operation Choke Point may constitute a serious mismanagement and abuse of the Department&#8217;s FIRREA [Financial Institution Reform and Recovery Act of 1989] authority.”</p>
<p style="color: #232323;">Issa wanted answers. The DOJ felt it was under no obligation to provide them.</p>
<p style="color: #232323;">By the end of May 2014, Issa’s concern had morphed into outrage. He issued a report <a href="http://www.breitbart.com/Big-Government/2014/05/29/House-Committee-Report-DOJ-Must-Disavow-and-Dismantle-Operation-Choke-Point"><span style="color: #1255cc;">contending</span></a> Operation Choke Point was so “flagrantly illegal” it was beyond legal rehabilitation. &#8220;In light of the Department&#8217;s obligation to act within the bounds of the law, and its avowed commitment not to &#8216;discourage or inhibit&#8217; the lawful conduct of honest merchants, it is necessary to disavow and dismantle Operation Choke Point,” the report stated. It further noted that Holder knew about the program prior to its launch, that he knew it was aimed at targeting legal entities—and that he nonetheless fully supported its implementation. Furthermore, the report suggested that once the program became public, the DOJ may have attempted to cover up parts of its operation.</p>
<p style="color: #232323;">It was also discovered that Operation Choke Point had expanded beyond the payday lending industry, targeting manufacturers, distributors, and dealers of firearms and ammunition, as well as coin dealers. And it was also revealed that a January 23, 2014 deadline regarding Issa’s request for information came and went absent any indication the DOJ had fulfilled it.</p>
<p style="color: #232323;">Three days later, <a href="http://myfoxdc.com/"><span style="color: #1255cc;">MyFoxdc.com</span></a> <a href="http://www.myfoxdc.com/story/25668177/holders-gun-grab-via-operation-choke-point"><span style="color: #1255cc;">issued</span></a> a report on Operation Choke Point alleging the program targeted the gun industry because Obama failed to get gun control legislation passed by Congress. If such an effort has a familiar ring, it’s because Obama has employed precisely the same Congress-bypassing tactic with regard to illegal immigration. At that time, The National Shooting Sports Foundation revealed many of its members in the firearms and ammunitions manufacturing industries had had their banking relationships wrongfully terminated by the program.</p>
<p style="color: #232323;">The report released Dec. 8 put the pernicious scope of the program in full perspective. Its key findings reveal the FDIC “equated legitimate and regulated activities&#8230;with inherently pernicious or patently illegal activities,” via “circular argument policymaking”&#8211;an original list of high-risk merchants were determined by FDIC, who then justified formal guidelines for banks by claiming the categories “had been previously noted”—by the FDIC itself.</p>
<p style="color: #232323;">The most egregious revelations centered around FDIC policymakers whose “personal animus” towards the payday industry was so intense that their senior-most bank examiners &#8220;effectively ordered banks to terminate all relationships with the industry.” An email from Thomas Dujenski, FDIC’s Atlanta regional director, to Mark Pearce, director of the Division of Depositor and Consumer Protection underscores that personal animus:</p>
<blockquote>
<p style="color: #232323;">I have never said this to you (but I am sincerely passionate about this) … but I literally cannot stand the pay day lending industry … I had extensive involvement with this group of lenders and was instrumental in drafting guidance on stopping abuses.</p>
</blockquote>
<p style="color: #232323;">Another damning email reveals that John Miller, <a href="https://www.fdic.gov/about/comein/bio-panelist/bio-fdic-miller.html"><span style="color: #1255cc;">Deputy Director</span></a> for Policy and Research in the Division of Depositor and Consumer Protection at the FDIC, was concerned about “taking pornography” out the equation in letters about targeted businesses to Congress. The redacted writer of the email expressed his concern that lumping pornography in with online gambling and payday loan companies might make it appear that the FDIC was making “moral judgments regarding the types of businesses with which our institutions deal.” The email continues:</p>
<blockquote>
<p style="color: #232323;">Jonathan heard where we were coming from but nonetheless wants to retain a reference to pornography in our letters/talking points. He thinks it’s important for Congress to get a good picture regarding the unsavory nature of the businesses at issue. He repeated that ‘one is judged by the friends one keeps,’ and he seems to feel strongly that including payday lenders in the same circle as pornographers and on-line gambling businesses will ultimately help with messaging on this issue.</p>
<p style="color: #232323;">If you feel there is legal argument beyond the one I made, and would like us to push back on this issue, please let me know.</p>
</blockquote>
<p style="color: #232323;">The report’s conclusions are unambiguous. &#8220;The practical impact of Operation Choke Point is incontrovertible: legal and legitimate businesses are being choked off from the financial system,” it states, further noting the experiences endured by firearms and ammunition dealers &#8220;is a testament to the destructive and unacceptable impact of Operation Choke Point.” The report’s last paragraph is a testament to the corrupt nature of the Obama administration and its power-abusing impulses:</p>
<blockquote>
<p style="color: #232323;">&#8220;At a minimum, Operation Choke Point is little more than government-mandated de-risking. FDIC, in cooperation with the Justice Department, made sure banks understood–or in their own language, &#8216;got the message&#8217;–that maintaining relationships with certain disfavored business lines would incur enormous regulatory risk. The effect of this policy has been to deny countless legal and legitimate merchants access to the financial system and deprive them of their very ability to exist. Accordingly, Operation Choke Point violates the most fundamental principles of the rule of law and accountable, transparent government.”</p>
</blockquote>
<p style="color: #232323;">Last June, Senator Rand Paul (R-KY) <a href="http://www.examiner.com/article/senator-rand-paul-tries-to-right-a-wrong-by-the-obama-administration"><span style="color: #1255cc;">filed</span></a> an amendment to the Science Justice Commerce Appropriations bill attempting to cut off the administration&#8217;s efforts to effectively shut down gun stores via Operation Choke Point. It followed the May 2014 passage of a House amendment sponsored by Rep. Blane Luetkeymeyer (R-MO) to <a href="http://www.conservativeactionalerts.com/2014/05/house-defunds-doj-choke-point-bullying-operation/"><span style="color: #1255cc;">defund</span></a> the program. It was ultimately <a href="http://newsbusters.org/blogs/tom-blumer/2014/06/03/establishment-press-ignores-house-vote-defund-operation-choke-point"><span style="color: #1255cc;">approved</span></a> by 204 Republicans and 117 Democrats. An article published by Human Events on Nov. 17, 2014 <a href="http://humanevents.com/2014/11/17/if-it-walks-like-a-lame-duck/"><span style="color: #1255cc;">indicates</span></a> the program has yet to be addressed in the still Democratically-controlled Senate.</p>
<p style="color: #232323;">After trying several senators’ offices, FrontPage contacted a source in Washington, D.C. who requested anonymity. He made a valiant effort to find any mention of the Operation Choke Point in the recently passed $1.1 trillion CRomnibus bill funding the federal government for FY2015. The search proved unsuccessful, indicating that it is more than likely Operation Choke Point remains alive and well. It behooves a GOP-controlled Congress to kill this egregious abuse of power as one of its first orders of business next year. The American public has no use whatsoever for public officials willing to trample the law to satisfy their personal worldview. In short, it’s time to strangle Operation Choke Point.</p>
<p><b>Freedom Center pamphlets now available on Kindle: </b><a href="http://www.amazon.com/s/ref%3dnb_sb_noss?url=search-alias%3Ddigital-text&amp;field-keywords=david+horowitz&amp;rh=n:133140011%2ck:david+horowitz&amp;ajr=0#/ref=sr_st?keywords=david+horowitz&amp;qid=1316459840&amp;rh=n:133140011%2ck:david+horowitz&amp;sort=daterank" target="_blank"><b>Click here</b></a><b>.</b></p>
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		<title>Obama: Let&#8217;s Start a New Financial Crisis</title>
		<link>http://www.frontpagemag.com/2013/john-perazzo/obama-lets-start-a-new-financial-crisis/?utm_source=rss&#038;utm_medium=rss&#038;utm_campaign=obama-lets-start-a-new-financial-crisis</link>
		<comments>http://www.frontpagemag.com/2013/john-perazzo/obama-lets-start-a-new-financial-crisis/#comments</comments>
		<pubDate>Fri, 05 Apr 2013 04:52:20 +0000</pubDate>
		<dc:creator><![CDATA[John Perazzo]]></dc:creator>
				<category><![CDATA[Daily Mailer]]></category>
		<category><![CDATA[FrontPage]]></category>
		<category><![CDATA[ACORN]]></category>
		<category><![CDATA[Banks]]></category>
		<category><![CDATA[CRA]]></category>
		<category><![CDATA[financial crisis]]></category>
		<category><![CDATA[Obama]]></category>

		<guid isPermaLink="false">http://frontpagemag.com/?p=184450</guid>
		<description><![CDATA[Our “progressive” president goes backward -- to the same policy that caused the current recession.]]></description>
				<content:encoded><![CDATA[<p><a href="http://frontpagemag.com/2013/john-perazzo/obama-lets-start-a-new-financial-crisis/fin/" rel="attachment wp-att-184454"><img class=" wp-image-184454 alignleft" title="fin" src="http://cdn.frontpagemag.com/wp-content/uploads/2013/04/fin.jpeg" alt="" width="256" height="192" /></a>File this under “Unbelievable.” We now <a href="http://www.washingtonpost.com/business/economy/obama-administration-pushes-banks-to-make-home-loans-to-people-with-weaker-credit/2013/04/02/a8b4370c-9aef-11e2-a941-a19bce7af755_story.html?tid=pm_pop">learn</a> from the <em>Washington Post</em> that the Obama administration, in its relentless quest for “social justice,” is pushing banks to make more loans to people with weak credit ratings. It seems that Obama and his “economic advisers” have concluded that the current “housing rebound” is “leaving too many people behind”—most notably, undercapitalized first-time homebuyers and nonwhite minorities with low credit scores. To remedy this putative disaster, the administration wants banks to rely less on the time-tested, race-neutral lending criteria that have served as reliable barometers of credit-worthiness since time immemorial—income, net worth, credit history, etc.  Instead, banks should “use more subjective judgment in determining whether to offer a loan” because, as Obama&#8217;s Federal Housing Administration (FHA) commissioner puts it, “there are lots of creditworthy borrowers &#8230; all the way down the credit-score spectrum.” And hey, if this policy ultimately causes borrowers to default on their loans, that&#8217;s no big deal. “Taxpayer-backed programs”—including those offered by the FHA—will magnanimously pick up the tab.</p>
<p>No, you aren&#8217;t in a time warp. This article wasn&#8217;t written ten years ago, before the housing-market crisis plunged the American economy into the proverbial sewer. Difficult as it may be to believe, the current president of the United States is actually prescribing <em>precisely the same practice</em>—government policies pressuring banks to lend money to unqualified applicants—that caused the crisis in the first place.</p>
<p>Let that sink in for a moment.</p>
<p>These types of government policies initially emerged the mid-1970s, when “progressive” Democrats in Congress began a campaign to help low-income minorities become homeowners. This led to the passage, in 1977, of the <a href="http://ecfr.gpoaccess.gov/cgi/t/text/text-idx?c=ecfr&amp;sid=52a4960633093ddafec2727093859f12&amp;rgn=div5&amp;view=text&amp;node=12:1.0.1.1.23&amp;idno=12#12:1.0.1.1.23.1.9.1">Community Reinvestment Act</a> (CRA), a mandate for banks to make special efforts to seek out and lend to borrowers of meager means. Founded on the premise that government intervention is necessary to counteract the fundamentally racist and inequitable nature of American society and the free market, the CRA was eventually transformed from an outreach effort into a strict <a href="http://www.city-journal.org/html/10_1_the_trillion_dollar.html">quota system</a> by the Clinton administration. Under the new arrangement, if a bank failed to meet its quota for loans to low-income minorities, it ran the risk of getting a low CRA <a href="http://www.fdic.gov/regulations/compliance/manual/pdf/XI-6.1.pdf">rating</a> from the <a href="http://www.fdic.gov/">FDIC</a>. This, in turn, could derail the bank&#8217;s <a href="http://www.cato.org/pubs/regulation/regv17n4/vmck4-94.pdf">efforts</a> to expand, relocate, merge, etc.  From a practical standpoint, then, banks had no recourse but to drastically <a href="http://www.nypost.com/seven/10132008/postopinion/opedcolumnists/spreading_the_virus_133375.htm?page=0">lower their standards</a> on down-payments and underwriting, and to approve many loans even to borrowers with weak credit credentials. As Hoover Institution Fellow Thomas Sowell explains, this led to “<a href="http://books.google.com/books?id=s3SVGKaLNukC&amp;pg=PA99&amp;lpg=PA99&amp;dq=%22Thomas+Sowell%22+and+“skyrocketing+rates+of+mortgage+delinquencies+and+defaults%22&amp;source=bl&amp;ots=g69i5P4qd-&amp;sig=1M1eN2q7s0TI1qjEEpfgLIzcFZQ&amp;hl=en&amp;sa=X&amp;ei=YaZdUbOrObGL0QGuk4DICg&amp;ved=0CDMQ6AEwAQ#v=onepage&amp;q=&quot;Thomas Sowell&quot; and “skyrocketing rates of mortgage delinquencies and defaults&quot;&amp;f=false">skyrocketing rates</a> of mortgage delinquencies and defaults,” and the rest is history.</p>
<p>The CRA was by no means the only mechanism designed by government to impose lending quotas on financial institutions. For instance, the Department of Housing and Urban Development (HUD) developed <a href="http://www.cato.org/pubs/regulation/regv17n4/vmck4-94.pdf">rules</a> encouraging lenders to dramatically hike their loan-approval rates for minority applicants and began bringing <a href="http://www.cato.org/pubs/bp/bp110.pdf">legal actions</a> against mortgage bankers who failed to do so, regardless of the reason. This, too, caused lenders to lower their down-payment and income requirements.</p>
<p>Moreover, HUD <a href="http://usgovinfo.about.com/b/2008/07/13/who-are-fannie-may-and-freddie-mac.htm">pressured</a> the government-sponsored enterprises Fannie Mae and Freddie Mac, the two largest sources of housing finance in the United States, to earmark a steeply rising number of their own loans for low-income borrowers. Many of these were subprime mortgages—loans characterized by higher interest rates and less favorable terms in order to compensate lenders for the high credit risk they were incurring.</p>
<p>Additional pressure toward this end was applied by community organizations like the pro-socialist <a href="http://www.discoverthenetworks.org/groupProfile.asp?grpid=6968">ACORN</a>. By <a href="http://www.city-journal.org/html/13_2_acorns_nutty_regime.html">accusing</a> banks—however frivolously or unjustly—of having engaged in racially discriminatory lending practices that violated the mandates of the CRA, these groups commonly sued banks to <a href="http://www.nypost.com/php/pfriendly/print.php?url=http://www.nypost.com/seven/09292008/postopinion/opedcolumnists/os_dangerous_pals_131216.htm">prevent</a> them from expanding or merging as they wished. Barack Obama, ACORN&#8217;s staunch ally, was strongly in favor of this practice. Indeed, in a 1994 class-action<strong> </strong>lawsuit against Citibank, Obama represented ACORN in demanding more favorable <a href="http://mobile.wnd.com/2012/09/obama-suffers-amnesia-blaming-bush-for-economy/">terms</a> for subprime homebuyer mortgages. After four years of being dragged through the mud, a beleaguered Citibank—anxious to put an end to the incessant smears (charging <a href="http://www.forbes.com/2009/10/03/community-reinvestment-act-mortgages-housing-opinions-contributors-peter-schweizer.html">racism</a>) that Obama and his fellow litigators were hurling in its direction (to say nothing of its mounting legal bills)—agreed to settle the case.</p>
<p><em>Forbes</em> magazine puts it <a href="http://www.forbes.com/2009/10/03/community-reinvestment-act-mortgages-housing-opinions-contributors-peter-schweizer.html">bluntly</a>: “Obama has been a staunch supporter of the CRA throughout his public life.” In other words, he has long advocated <em>the very policies that already have reduced </em><em>the real-estate market to rubble</em>. And now he is actively pushing those very same practices <em>again</em>. The reason for this is not difficult to comprehend: The president of the United States is a socialist ideologue who reveres big-government interventionism and deplores the free market. For good measure, he also happens to be an economic illiterate who, in his pontifications about fiscal matters, has all the credibility of a pre-Copernican stargazer explaining precisely how the sun revolves around the earth.</p>
<p><strong>Freedom Center pamphlets now available on Kindle: <a href="http://www.amazon.com/s/ref%3dnb_sb_noss?url=search-alias%3Ddigital-text&amp;field-keywords=david+horowitz&amp;rh=n:133140011%2ck:david+horowitz&amp;ajr=0#/ref=sr_st?keywords=david+horowitz&amp;qid=1316459840&amp;rh=n:133140011%2ck:david+horowitz&amp;sort=daterank" target="_blank">Click here</a>.  </strong></p>
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		<title>Hack a Bank for Muhammad</title>
		<link>http://www.frontpagemag.com/2013/lloyd-billingsley/hack-a-bank-for-muhammad/?utm_source=rss&#038;utm_medium=rss&#038;utm_campaign=hack-a-bank-for-muhammad</link>
		<comments>http://www.frontpagemag.com/2013/lloyd-billingsley/hack-a-bank-for-muhammad/#comments</comments>
		<pubDate>Thu, 04 Apr 2013 04:18:40 +0000</pubDate>
		<dc:creator><![CDATA[Lloyd Billingsley]]></dc:creator>
				<category><![CDATA[Daily Mailer]]></category>
		<category><![CDATA[FrontPage]]></category>
		<category><![CDATA[Banks]]></category>
		<category><![CDATA[Cyber]]></category>
		<category><![CDATA[data theft]]></category>
		<category><![CDATA[Islam]]></category>
		<category><![CDATA[Izz al-Din al-Qassam Cyber Fighters]]></category>
		<category><![CDATA[Jihad]]></category>

		<guid isPermaLink="false">http://frontpagemag.com/?p=184106</guid>
		<description><![CDATA[How Islamic cyber-attacks make the world more dangerous.]]></description>
				<content:encoded><![CDATA[<p><a href="http://frontpagemag.com/2013/lloyd-billingsley/hack-a-bank-for-muhammad/cyber/" rel="attachment wp-att-184239"><img class=" wp-image-184239 alignleft" title="cyber" src="http://cdn.frontpagemag.com/wp-content/uploads/2013/04/cyber-450x232.jpg" alt="" width="315" height="162" /></a>Most recent news on hacking has centered on China’s data theft from U.S. companies. The Izz al-Din al-Qassam Cyber Fighters have drawn much less attention, even though in late March <a href="http://www.usatoday.com/story/tech/2013/03/29/american-express-denial-of-service-hack/2030197/">they temporarily disabled the online banking systems</a> of American Express and Wells Fargo Bank, both major U.S. financial players. The inspiration for the attacks is instructive.</p>
<p>Izz al-Din al-Qassam was a Syrian preacher of jihad killed in a guerilla attack against the British in 1935. He inspired the PLO’s Yasser Arafat and the Islamic Resistance Movement, the military wing of Hamas, is named after him. The Izz al-Din al-Qassam Cyber Fighters first launched their campaign the week of September 11, 2012, when jihadists attacked U.S. embassies in several countries, most notably Libya, where they killed four Americans including ambassador Christopher Stevens.</p>
<p>The pretext was not any U.S. diplomatic or military action – indeed, the United States had aided anti-Gadaffi Libyan rebels – but an internet video “Innocence of Muslims,” reportedly portraying the prophet Muhammad as a fraud. Few had seen the trailer, which Hillary Clinton, then U.S. Secretary of State, called “disgusting and reprehensible.” Susan Rice, president Obama’s ambassador to the United Nations, claimed the Libya attack was “spontaneous – not a premeditated response” to “this very offensive video that was disseminated.” She did not say by whom.</p>
<p>The Izz al-Din al-Qassam Cyber Fighters claimed that Western agencies made the film and demanded that it be removed from YouTube. They launched <a href="http://analysisintelligence.com/cyber-defense/deconstructing-the-al-qassam-cyber-fighters-assault-on-us-banks/">“Operation Alababil,” a series of attacks</a> on Bank of America, Wells Fargo, PNC and other U.S. financial heavyweights in “revenge in response to the humiliation of the Organization of the Prophet of Islam (PBUH) by some Western countries.”</p>
<p>Richard A. Clarke a former National Coordinator for Security, Infrastructure Protection, and Counter-terrorism, told ABC news that it was the first time an entity from the Middle East, perhaps a government, “had attacked websites, critical infrastructure in the United States.” The hackers claimed to be independent defenders of Islam taking orders from no one. But senator Joseph Lieberman and American computer security experts saw the hand of Iran in the attacks, more intense than those Russia directed at Estonia in 2007. Experts note that financial disruption is the calling card of state-sponsored attacks and the sophistication far exceeded the level of amateurs. It is entirely possible that Iran was responding to Western economic sanctions using the al-Qassam group as its proxy and the video as the pretext.</p>
<p>The Al Qassam squad continued the attacks until late October, 2012, then resumed the campaign in December claiming the attacks would continue until the U.S. government pulled the video off YouTube. The attacks have continued in March 2013, on the same pretext and with the same solution: pull the video and the attacks will stop. One doubts it, and now the context is different.</p>
<p>Jihadist mobs are not currently besieging American embassies and murdering ambassadors. On the other hand, Iran, an Islamic regime with a harem of carefully fondled hatreds, particularly for the United States, continues its pursuit of nuclear weapons. North Korea has canceled its armistice with the United States and continues to rattle its nuclear saber. As Americans face this double nuclear jeopardy, they might keep some realities in mind.</p>
<p>U.S. officials are fond of claiming that the nation is not at war with Islam but the cyberattacks are evidence that supremacist Islam remains at war with the United States and its allies. The video pretext, meanwhile, was a phony from the beginning, part of a carefully planned series of terrorist attacks on U.S. facilities and interests. The renewed attacks by the Izz al-Din al-Qassam Cyber Fighters should serve as a reminder that the Obama administration, acting through Hillary Clinton and Susan Rice, essentially parroted a jihadist propaganda ploy.</p>
<p>That sent a strong signal to al-Qassam, al Qaeda, Hamas, Iran and North Korea alike. If any terrorist group or nation seeks to attack the United States with weapons of mass destruction, the conditions are now the most favorable they can expect. The world is now more dangerous than during the Cold War when the Soviet nuclear arsenal was the major threat.</p>
<p><strong>Freedom Center pamphlets now available on Kindle: <a href="http://www.amazon.com/s/ref%3dnb_sb_noss?url=search-alias%3Ddigital-text&amp;field-keywords=david+horowitz&amp;rh=n:133140011%2ck:david+horowitz&amp;ajr=0#/ref=sr_st?keywords=david+horowitz&amp;qid=1316459840&amp;rh=n:133140011%2ck:david+horowitz&amp;sort=daterank" target="_blank">Click here</a>.  </strong></p>
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		<title>An Offer Cypriots Can&#8217;t Refuse</title>
		<link>http://www.frontpagemag.com/2013/arnold-ahlert/an-offer-cypriots-cant-refuse/?utm_source=rss&#038;utm_medium=rss&#038;utm_campaign=an-offer-cypriots-cant-refuse</link>
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		<pubDate>Tue, 26 Mar 2013 04:39:05 +0000</pubDate>
		<dc:creator><![CDATA[Arnold Ahlert]]></dc:creator>
				<category><![CDATA[Daily Mailer]]></category>
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		<guid isPermaLink="false">http://frontpagemag.com/?p=183071</guid>
		<description><![CDATA[Citizens running scared after EU ruling class pushes through draconian cash confiscation deal. ]]></description>
				<content:encoded><![CDATA[<p><a href="http://frontpagemag.com/2013/arnold-ahlert/an-offer-cypriots-cant-refuse/0325_cyprus_630x420/" rel="attachment wp-att-183075"><img class="alignleft  wp-image-183075" title="0325_cyprus_630x420" src="http://cdn.frontpagemag.com/wp-content/uploads/2013/03/0325_cyprus_630x420-450x337.jpg" alt="" width="270" height="202" /></a>In what has become a depressingly familiar EU template, yet another &#8220;eleventh hour&#8221; deal was <a href="http://www.foxnews.com/world/2013/03/25/cypriot-leaders-creditors-secure-agreement-toward-bailout/">reached</a> between the European Central Bank (ECB) the European Commission (EC) and the International Monetary Fund (IMF) &#8212; known as the &#8220;troika&#8221; &#8212; and Cypriot President Nicos Anastasiades to avoid national bankruptcy. “It’s been yet another hard day’s night,” European Union Economic and Monetary Affairs Commissioner Olli Rehn <a href="http://www.bloomberg.com/news/2013-03-25/cyprus-to-chop-banking-system-to-win-aid-avoid-default.html">told</a> reporters in Brussels, where the deal was put together. “There were no optimal solutions available, only hard choices.”</p>
<p>Hard choices indeed. In return for a $13 billion ($10 billion Euro) bailout, the tiny Mediterranean nation has agreed to wind down Laiki Bank, Cyprus&#8217;s second largest, wiping out thousands of jobs in the process. Depositors holding more than $130,000 will take potentially huge losses, the percentage of which <a href="http://www.nytimes.com/2013/03/25/business/global/cyprus-and-europe-officials-agree-on-outlines-of-a-bailout.html?ref=todayspaper&amp;_r=1&amp;">has yet</a> to be determined. But because the bank is expected to yield approximately $5.4 billion to satisfy the latest agreement, it is estimated that those losses will be as much as 40 percent, more than four times the 9.9 percent that was part of the deal rejected by the Cypriot parliament in a unanimous 36-0 vote last week.</p>
<p>No parliamentary vote will be required this time around. In the previous deal, the bailout money confiscated from bank accounts was going to be raised by imposing a nationwide tax on bank accounts that were both insured and uninsured. Imposing a tax required a vote by the Cypriot parliament. Because this new grab only targets uninsured accounts at Laiki Bank and the Bank of Cyprus, nine laws passed last Friday by parliament allowing bank &#8220;restructures&#8221; to go forward <a href="http://www.businessinsider.com/why-the-cypriot-parliament-doesnt-have-to-vote-on-the-deal-this-time-2013-3">means</a> no further vote is required.</p>
<p>Depositors with less than $130,000 in holdings will <a href="http://www.bbc.co.uk/news/world-europe-21916102">remain</a> &#8220;fully guaranteed.&#8221; In a deal reminiscent of the TARP bailout, Laiki Bank will be immediately dissolved into a &#8220;bad bank&#8221; containing uninsured deposits and toxic assets, while the remaining insured deposits with be transferred to the “good” Bank of Cyprus, the nation&#8217;s largest lending institution.</p>
<p>EU-philes and other assorted leftists offered their typical rationale for this latest effort. The <em>New York Times</em> framed the deal as one that would &#8220;prune the size of Cyprus’s oversize banking sector, bloated by billions of dollars from Russia and elsewhere in the former Soviet Union.&#8221; IMF leader Christine Lagarde called it a &#8220;a comprehensive and credible plan&#8221; to restore faith in the nation&#8217;s banking system. French Finance Minister Pierre Moscovici deemed the deal necessary because Cyprus is &#8220;a casino economy that was on the brink of bankruptcy.&#8221; Cypriot Finance Minister Michalis Sarris claimed that &#8220;we really have avoided a disastrous exit from the eurozone.&#8221; German Finance Minister Wolfgang Shaeuble contended the agreement was “capable of stabilizing the situation in Cyprus.”</p>
<p>The realists were far less sanguine. &#8220;This decision is painful for the Cypriot people. This decision was a defeat of solidarity, of social cohesion, which are fundamental freedoms, fundamental principles of the European Union,&#8221; Parliament President Yiannakis Omirou told AP. &#8220;So as soon as possible we have to prepare our economy to go out from the mechanism and the troika,&#8221; he added. Nicholas Papadopolous, chairman of the Cypriot parliament&#8217;s finance committee, was far more direct. &#8220;We are heading for a deep recession, high unemployment. [The troika] wanted to send a message that the Cypriot economy ought to be destroyed, and they&#8217;ve succeeded in a large part&#8211;they&#8217;ve destroyed our banking sector,&#8221; he told the BBC. Russian Prime Minister Dmitry Medvedev <a href="http://www.reuters.com/article/2013/03/25/us-cyprus-parliament-idUSBRE92G03I20130325">spelled out</a> the meaning of the deal in no uncertain terms. &#8220;The stealing of what has already been stolen continues,&#8221; he said.</p>
<p>Perhaps the most amazing&#8211;and utterly naive&#8211;aspect of this deal is the idea that what has happened in Cyprus will stay in Cyprus. UK Independence Party (UKIP) leader Nigel Farage <a href="http://www.telegraph.co.uk/news/politics/ukip/9950083/Ukip-urges-Brits-to-withdraw-their-money-from-Spanish-banks.html">called on</a> British expats in Spain to pull their money out of <em>Spanish</em> banks, contending the EU leaders had &#8220;crossed a line&#8221; in Cyprus. “There is going to be a big flight of money and that flight of money won’t just be from Cyprus, it will be from the other eurozone countries, too,&#8221; he warned. &#8220;There are 750,000 British people who own properties, or who live, many of them in retirement, down in Spain. Now that we see the EU are prepared to resort to anything to keep alive their failing euro project, our advice to expats living down in the Mediterranean must be, &#8216;Get your money out of there while you’ve still got a chance.&#8217;”</p>
<p>Christopher Pissarides, a Nobel prize-winning economist advising President Nicos Anastasiades, <a href="http://www.dailymail.co.uk/news/article-2298337/Cyprus-Russia-savages-EU-island-gets-8-5billion-bailout-deal-richest-investors-losing-40-savings.html">contended</a> that the troika is treating Cyprus &#8220;far worse&#8221; than other EU basket cases that needed bailouts, and predicts that &#8220;the way we deal with this situation has implications for the rest of Europe.&#8221; &#8220;We have a German finance minister who comes and tells us Cypriots that &#8216;We don’t like your economic model, bankrupt your banks and you can sort it out on the way&#8217;&#8230;The difference with Cyprus is that it is small. Is Luxembourg going to be next in line? Is Malta going to be next in line? Small members of the Eurozone beware,&#8221; he cautioned.</p>
<p>In the same Friday session during which bank restructuring laws were passed, the Cypriot parliament also <a href="http://www.americanthinker.com/blog/2013/03/cyprus_in_11th_hour_bailout_deal_with_eu.html">imposed</a> capital controls to prevent a likely stampede of money out of the country. Yet the EC, claiming they were acting on behalf of &#8220;Cypriot authorities&#8221; said that such controls, which violate EU laws regarding the free flow of capital, can only be imposed for a short time. &#8220;This is a restriction on movement that may only last a few days,&#8221; said Michel Barnier, the Commissioner responsible for the EU&#8217;s single market.</p>
<p>Cypriot banks are supposed to open today, after imposing cash withdrawal limits at bank machines over last weekend when Cypriots began withdrawing their money in droves. At first, they could withdraw 400 Euros, then 260, and then only 100 Euros, after the central bank in Cyprus stepped into prevent a run. Cash was king over the weekend as well, as several retailers refused to take credit cards or checks. “It’s been cash-only here for three days,” said Ali Wissom, a restaurant manager in Nicosia. “The banks have closed, we don’t really know if they will reopen, and all of our suppliers are demanding cash&#8211;even the beer company.”</p>
<p>It will undoubtedly get worse. Russians, who maintain accounts totaling $31 billion of the total $88 billion held in Cypriot banks, will surely find other places to put their money, after having been caught flat-footed by this deal. Dozens of them <a href="http://www.ft.com/cms/s/0/de24fb32-94a1-11e2-9487-00144feabdc0.html#axzz2OZEW88l9">descended</a> on the country last week to vent their anger at Cypriot officials. Fedor Mikhin, who owns an international shipping business, illuminated the implications. &#8220;The locals should understand: as soon as the money leaves, the people who go to restaurants, buy cars and buy property leave too,&#8221; he said. &#8220;The Cypriots’ means of living will disappear. They are saying we laundered all the money, but they lived on that money for ten years and forgot about it,” he added.</p>
<p>European Commission President Jose Manuel Barroso insists the future is less certain.&#8221;I am confident that the program will work, but let&#8217;s be honest. At this moment, we cannot say exactly what the impact is going to be,&#8221; he told reporters. &#8220;It will depend on the level of implementation and the commitment of Cyprus itself.&#8221;</p>
<p>The &#8220;impact&#8221; may be more than monetary. A public poll conducted by Cyprus’s Sigma television <a href="http://www.nytimes.com/2013/03/24/world/europe/russian-ties-put-cyprus-banking-crisis-on-east-west-fault-line.html?pagewanted=all">reveals</a> that more than 66 percent of those surveyed would be willing to drop the euro and move closer to Russia. Much of the island&#8217;s anger has been directed towards the EU in general, and German Chancellor Angela Merkel in particular, whose nation Cypriots consider the chief architect behind the deal. “There is a clear danger of this area becoming a platform for confrontation between East and West,” said Harry Tzimitras, director of a research center in Nicosia.</p>
<p>It already has, and the more than 50,000 Russian-speaking people who have come to Cyprus from the former Soviet Union deeply resent the underlying rationale behind this confiscation of funds. &#8220;We are not criminals, arms dealers or bootleggers,” said Sergey Ivanov, a Russian who runs a wine business. “There is a generation of Russian businessmen like me who have lost faith in the Russian government, in Russian banks and in Russian laws. That is why we are in Cyprus.” A Nicosia-based lawyer was equally contemptuous. “I don’t understand why it is money laundering when it’s in Cyprus, when in London it’s a perfectly respectable company.”</p>
<p>There is no question that Cyprus has benefited greatly from its <a href="http://business.time.com/2013/03/25/cyprus-rescue-the-destruction-of-a-tax-haven/?xid=rss-topstories">30-year</a> reputation as a tax haven. Foreign companies pay a flat tax rate of just 10 percent, making it extremely attractive to operate there. That reality may explain what this deal is <em>really</em> all about: to send a message that the socialist beast devouring Europe will brook no challenges to its high-tax, supra-nationalist authority despite the reality that it was the supra-nationlists and their lust for a &#8220;new world order&#8221; under the EU that set the entire &#8220;poor southern Europe versus rich northern Europe&#8221; dynamic in motion. It is a dynamic that has a financially secure Germany berating its spendthrift southern neighbors for being fiscally irresponsible, even as its heavily export-dependent economy requires such nations to buy German goods.</p>
<p>Ever since the European fiscal crisis began, the bureaucrats in Brussels have successfully convinced the majority of people living in places like Greece, Spain and Italy that national bankruptcy and a return to a national currency would be far more catastrophic than the ongoing austerity measures currently being imposed.</p>
<p>Yet one has to wonder how long that argument will continue to resonate. In Greece, for example, the unemployment rate reached a <a href="http://www.huffingtonpost.com/2013/02/14/greece-unemployment-rate-record-high_n_2687356.html">record-setting</a> 27 percent in November. Almost unbelievably, that rate soars to 61.7 percent for those in the 15-24 age group. They are in their sixth straight year of a &#8220;recession,&#8221; that is really an outright depression, and their economy shrank another 6.45 percent in 2012. Furthermore, 35 percent of the entire population will be officially living in poverty by the end of 2013, an increase of five percent in just two years, all with no end in sight<em>.</em></p>
<p>Can national bankruptcy and a return to the drachma, which would then be devalued to attract foreign investment, be any <em>worse</em>?</p>
<p>Coming to that conclusion is precisely what the Brussels bureaucrats and the international finance establishment are desperately trying to suppress. Yet in their unrelenting arrogance, they have overplayed their hand. The ultimate fundamental that encourages people to put their money in financial institutions is trust. That trust has now been obliterated. &#8220;We now have a new type of rule and everyone within the euro zone has to sit down and see what that implies for their own finances,” <a href="http://www.bloomberg.com/news/2013-03-25/saving-cyprus-means-nobody-safe-as-europe-breaks-more-taboos.html">warned</a> Christopher Pissarides.</p>
<p>David Folkerts-Landau, chief economist of Deutsche Bank, was far more honest. “If a single country leaves the euro zone, it sets a precedent,” he said last week. “No one will ever again believe that a country will not leave the euro zone.” Whether it stays or goes, Cyprus is facing a nightmarish scenario. What the people of that nation have to figure out is which scenario puts them in a better position for the future.</p>
<p>Cypriots might take their cue from Iceland President Olafur Ragnar Grimson. When that nation faced a banking crisis in 2008, they took a capitalist approach to the problem: they let the banks go under. Five years later, the economy is growing at a <a href="http://thehivedaily.com/blog/2011/02/04/iceland-didnt-bail-out-banks-economy-thriving/">three percent clip</a>, and their <a href="http://www.tradingeconomics.com/iceland/unemployment-rate">unemployment rate</a>, which rose to 8.6 percent in January 2011, was down to 5.5 percent in January 2013. At the World Economic Forum in Davos that same month, Grimson posed a fundamental question. &#8220;Why do we consider banks to be like holy churches?&#8221; he wondered. Perhaps Cypriots&#8211;along with a lot of other people&#8211;might ask themselves the same question.</p>
<p><strong>Freedom Center pamphlets now available on Kindle: <a href="http://www.amazon.com/s/ref=nb_sb_noss?url=search-alias%3Ddigital-text&amp;field-keywords=david+horowitz&amp;rh=n%3A133140011%2Ck%3Adavid+horowitz&amp;ajr=0#/ref=sr_st?keywords=david+horowitz&amp;qid=1316459840&amp;rh=n%3A133140011%2Ck%3Adavid+horowitz&amp;sort=daterank">Click here</a>.</strong></p>
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		<title>An American Cyprus?</title>
		<link>http://www.frontpagemag.com/2013/dgreenfield/an-american-cyprus/?utm_source=rss&#038;utm_medium=rss&#038;utm_campaign=an-american-cyprus</link>
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		<pubDate>Fri, 22 Mar 2013 04:30:18 +0000</pubDate>
		<dc:creator><![CDATA[Daniel Greenfield]]></dc:creator>
				<category><![CDATA[Daily Mailer]]></category>
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		<guid isPermaLink="false">http://frontpagemag.com/?p=182346</guid>
		<description><![CDATA[Everyone is scrambling to salvage what they can from an unsustainable system -- are we next? ]]></description>
				<content:encoded><![CDATA[<p><a href="http://frontpagemag.com/2013/dgreenfield/an-american-cyprus/cyprusrfd-sfspan/" rel="attachment wp-att-182448"><img class="alignleft  wp-image-182448" title="CyprusRFD-sfSpan" src="http://cdn.frontpagemag.com/wp-content/uploads/2013/03/CyprusRFD-sfSpan.jpg" alt="" width="237" height="158" /></a>Cyprus is Europe&#8217;s original failure. It was the first part of modern Europe to be invaded and colonized by Muslims, while its native Christian population was ethnically cleansed. Cyprus is to Islam what Czechoslovakia was to Nazism; the canary in the coal mine warning of worse things to come.</p>
<p>Now Cyprus has wound up in the middle of the European Union&#8217;s meltdown as everyone scrambles to salvage what they can from an unsustainable system at the expense of everyone else. We are seeing the beginnings of bailout cannibalism as the Eurocrats manipulate entire nations into fighting each other. The real purpose of the deposit grab was to wreck Cyprus&#8217;s banking sector and continue the centralization of international finance.</p>
<p>The Cypriot government tried to salvage its banking sector by passing on the pain to ordinary depositors in one of those brutally unfair decisions that technocrats like so long as they have the early warning to opt out of them. While the banks were closed to ordinary people, there&#8217;s little doubt that plenty of insiders took the time to get their money out.</p>
<p>In Cyprus, the Russian elite looking for a safe place to put its money when the people turn on them intersected with a Eurocratic elite trying to eliminate safe harbors and cheap places to do business. And they all bumped into British senior citizens looking for a cheap place to retire and angry leftists with no serious economic plan, but a determination to overthrow the government.</p>
<p>Cyprus is the place we go to learn that everything is tangled up with everything else and that the only things left are blame to be passed around and money to be stolen.</p>
<p>Everyone is deep in debt and no one is going to pay up. And why should they? Southern Europe may have dug itself into a hole, but the Eurocrats ordering them to dig out were the ones who provided the shovel because it seemed like a good idea at the time. Debt was a profitable and useful political tool. It still is.</p>
<p>American Federalism was built on the Federal assumption of state debts. Obama&#8217;s two-term reign was built on massive bailouts used to consolidate power while reassuring the banks that they would be taken care of. The National Debt is headed into 17 trillion dollar territory because that too is a useful political tool. Driving the debt to the point where it can never be repaid is meant to transform the entire way we do business and spend money. And it&#8217;s working.</p>
<p>Cyprus was a dirty little demonstration that you can kill two birds with one stone by giving a desperate government two impossible choices. And despite all the reassurances, there is no real reason to believe that it will stay in Cyprus. If anything the last few days have demonstrated how effective that particular tactic is. And once the money has fled Cyprus, the demonstration will be considered a success.</p>
<p>The problem with Europe, as with the United States, is that you can only assume so much debt and failure. German bankers may profit from pressing Cyprus depositors, but the German people are still in hock for far more than they should be. Similarly New York bankers and California Green tech entrepreneurs may be making money from the last four years, but their actual cities and states are deep in debt and floundering.</p>
<p>The European Union&#8217;s interlinkage makes as little sense as tethering some of the most productive states in the United States to the least productive states. The sort of thing that outrages Europeans has long been taken for granted by Americans.</p>
<p>The two-term kleptocracy now in office was elected on an explicit pledge of wealth redistribution, but the process of moving money from healthy communities to unhealthy communities, from bad cities to good cities and from bad states to good states, has been underway for a while.</p>
<p>Detroit, a city where hardly anyone bothers paying property taxes, has finally gotten an emergency financial manager, but there&#8217;s no real reason to believe that the people sticking it out in Motor City who don&#8217;t pay their bills, but do collect government cash, are going to change.</p>
<p>Someone else is going to have to bail them out because Detroit is too big to fail, even though it has already failed, because the United States is too big to fail, and the United States is too big to fail for the same reason that the EU and the new Chinese capitalism are all too big to fail. Everyone is invested in everyone else and no one can afford for anyone to fail; unless it&#8217;s small outposts like Cyprus that can be safely looted by the big boys.</p>
<p>But the real question is how long it will stay that way. For now everyone subscribes to the myth that a recovery is here and that all the really big investments that depend on working countries are safe.</p>
<p>China pretends that America isn&#8217;t being run by lefty professors-for-life with worse math skills than manatees and America pretends that China&#8217;s economy isn&#8217;t one giant Potemkin village maintained with currency manipulation and slave labor. Everyone pretends that everyone wants to be in the EU, despite a pesky refusal to hold actual referendums on the topic (and ignoring those that have been held) and also pretending not to notice all the money in the EU budget that can&#8217;t be accounted for.</p>
<p>All this is Cyprus and Greece, but on a much bigger scale.</p>
<p>Whether or not other governments and their banking systems begin looting consumers as crudely as the Cyprus scheme attempted to do; loot them they shall. And they will hit the middle class, because that is, as a famous bank robber once said, where the money is.</p>
<p>The left likes to pretend that removing the middle class will make room for some clean regime of the oppressed. What it will actually do is remove the citizenry with enough power and wealth to keep government in check and replace it with beggars and rebels who depend on government subsidies while hating the government. If you want to see what an extended bout of that looks like, you can travel to the Middle East. These days you can try Europe as well.</p>
<p>Eurocrats fancied that the Arab Spring meant that the Muslim world was finally catching up to Europe. It&#8217;s the other way around. These days Europe is catching up to the Arab Spring and not just because of the wave of Muslim colonists spreading across its shores. European countries are losing the vestiges of democracy and bouncing between unelected technocrats and elected extremists.</p>
<p>The Brotherhood phenomenon is not foreign to Europe. Not when Athens is tilting to the Golden Dawn and Italy&#8217;s new power broker is a leftist comedian whose sole virtue is that he hates it all. Eventually the far right or the far left will get its ducks in a row and make a serious play for power and the Eurocrats will either be caught flatfooted or will be forced to invalidate elections.</p>
<p>That is one more reason why American liberals should not be too proud of the Obama machine. What looks shiny and clever in 2013 may take on a whole different appearance as the malaise drags on and an angry jobless generation looks to get its payback and paychecks by voting for anyone who screams the loudest.</p>
<p>Beating Mitt Romney was no great achievement. Neither was beating McCain. But at some point the government-media complex of social welfare and crony capitalism will go up against an angry populist with an agenda and an organized movement, from the right or the left, and then things will get properly ugly.</p>
<p>The establishment has no plan except to continue doing its thing while pretending that nothing is wrong. It can&#8217;t fill the hole in the boat so it bails in more water from the ocean and calls it investment. It&#8217;s a madness that will begin nearing its end once people are standing outside banks demanding their money back.</p>
<p>And that is as true for the United States as it is for Europe.</p>
<p><strong>Freedom Center pamphlets now available on Kindle: <a href="http://www.amazon.com/s/ref%3dnb_sb_noss?url=search-alias%3Ddigital-text&amp;field-keywords=david+horowitz&amp;rh=n:133140011%2ck:david+horowitz&amp;ajr=0#/ref=sr_st?keywords=david+horowitz&amp;qid=1316459840&amp;rh=n:133140011%2ck:david+horowitz&amp;sort=daterank" target="_blank">Click here</a>.  </strong></p>
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		<title>Cyprus and the Rotten Union of Big Government &amp; Big Finance</title>
		<link>http://www.frontpagemag.com/2013/mark-hendrickson/cyprus-and-the-rotten-union-of-big-government-big-finance/?utm_source=rss&#038;utm_medium=rss&#038;utm_campaign=cyprus-and-the-rotten-union-of-big-government-big-finance</link>
		<comments>http://www.frontpagemag.com/2013/mark-hendrickson/cyprus-and-the-rotten-union-of-big-government-big-finance/#comments</comments>
		<pubDate>Thu, 21 Mar 2013 04:16:05 +0000</pubDate>
		<dc:creator><![CDATA[Mark Hendrickson]]></dc:creator>
				<category><![CDATA[Daily Mailer]]></category>
		<category><![CDATA[FrontPage]]></category>
		<category><![CDATA[Banks]]></category>
		<category><![CDATA[confiscation]]></category>
		<category><![CDATA[crisis]]></category>
		<category><![CDATA[Cyprus]]></category>
		<category><![CDATA[deposit]]></category>
		<category><![CDATA[Tax]]></category>

		<guid isPermaLink="false">http://frontpagemag.com/?p=182350</guid>
		<description><![CDATA[A significant move is underway toward rule by lawless global bureaucracies. ]]></description>
				<content:encoded><![CDATA[<p><a href="http://frontpagemag.com/2013/mark-hendrickson/cyprus-and-the-rotten-union-of-big-government-big-finance/130318115052-cyprus-protests-police-620xa-3/" rel="attachment wp-att-182459"><img class="alignleft  wp-image-182459" title="130318115052-cyprus-protests-police-620xa" src="http://cdn.frontpagemag.com/wp-content/uploads/2013/03/130318115052-cyprus-protests-police-620xa2-441x350.jpg" alt="" width="265" height="210" /></a>Everyone in the financial community and at the top levels of governments around the world has one eye trained on the Mediterranean island nation of Cyprus now.</p>
<p>Unless you’ve been isolated from the media, you’ve probably heard that over the weekend, the government of Cyprus announced a tax on bank deposits to rescue the banks from potential insolvency. The term “bail-in” has been coined to differentiate between a taxpayer bailout (i.e., rescue funds coming from outside the bank) since in this case, at least some of the cost of rescuing the bank is coming from money already within the bank.</p>
<p>For the moment, the Cyprus government has retreated and stated that they have decided not to impose the tax; nevertheless, serious damage has been done. Money and banking ultimately depend on people having confidence in their soundness and integrity. It’s hard to see why, going forward, anyone would risk depositing money into a Cypriot bank if the government seems inclined to raid those accounts without notice. (That having been said, we should note that the Argentine government has confiscated a portion of bank deposits in their country in the past, yet banks still function in Argentina.)</p>
<p>The banking crisis in Cyprus is similar to the one that occurred in Iceland about five years ago. In both cases, the banks in those small island nations had balance sheets that were far larger than the modest GDPs of their respective countries. Iceland’s government bit the bullet, let the banks go broke without a taxpayer bailout. The Icelanders went through tough times for a couple of years, suffering a sharp devaluation of their currency, but now they are on the mend and credit markets have been restored. Cyprus, however, uses the euro, and so does not have the option of a currency devaluation.</p>
<p>Indeed, the government in Cyprus lacks the independence that the government in Iceland had. The European Central Bank and the International Monetary Fund are exerting heavy pressure on Cyprus’s government to implement the tax on deposits. They seem to be making an offer that the Cypriots ultimately might not be able to refuse. This power play raises several profound and unsettling questions.</p>
<p>The famous gold analyst, Jim Sinclair, triggered a tsunami of lurid speculations stemming from the fact that powerful Russian interests—allegedly, an old KGB network that enriched itself by looting valuable assets from the corpse of the Soviet state and parked huge hordes of cash in Cypriot banks —were the primary target of the proposed confiscation (tax). Sinclair averred that those hardball-playing Russians were the last customers in the world that the IMF and ECB should want to antagonize. Would the Russians send a message by taking out someone who helped to hatch the “bail-in” scheme? Would they try to destabilize the euro using whatever ability they have to rock markets? Would the Federal Reserve and ECB pay off the Russians by giving equivalent financial assets to them to keep them from doing some dastardly deed? Who knows? Such possibilities are titillating, although purely conjectural and possibly completely fantastical.</p>
<p>What should concern us all is the state of banking in the world today.</p>
<p>The banking crisis in Cyprus is the latest evidence that Big Government and Big Finance are joined at the hip. Iceland appears to be an outlier. In most parts of the world, politicians act as though they cannot afford to let market discipline put an end to error-prone banks.</p>
<p>The bailout/bail-in paradigm makes a mockery of the rule of law. I’ve been saying for several years that the major central banks of the world are essentially lawless. I’m not a lawyer, so technically I may be incorrect, but it seems to me that the central banks do whatever they feel they have to do—break contracts, abrogate property rights, purchase assets, dole out new funds created out of thin air—to prop up decrepit, bankrupt financial institutions because the deeply indebted governments of the world cannot continue to operate without the ready availability of complicit, dependent big banks to maintain a functioning infrastructure to accommodate their trillions of dollars of low-value paper. The last thing that those holding high office in governments want is for the whole rotten, rickety financial, economic, political status quo to come crashing down, so they willingly turn a blind eye to central banks’ creative interpretations of law and give them carte blanche to do whatever they must to keep the game going.</p>
<p>The inexorable trend of this “rule of expediency” in place of the rule of law is increasing centralization of power and the progressive absorption and confiscation of wealth for the state’s purposes. Compounding the ugliness of this grim process is the fact that the key decisions and policies are made by unelected officials. Central bankers are accountable to the governments that appoint them in a technical de jure sense, but in a de facto sense, they have free rein. Even less accountable are those who run the IMF. This mid-‘40s monstrosity was one of the first multilateral agencies to be created. The American official who helped to set up this bureaucracy designed to redistribute wealth from American and European taxpayers to often corrupt and illiberal governments was Harry Dexter White, who turned out to be a secret member of the Communist Party. If he were here today, he would have the satisfaction of seeing his baby sitting astride the financial system of the globe, dispensing billions of dollars and dictating policies to once-sovereign governments.</p>
<p>In short, there is a lot more at stake in Cyprus’s banking crisis than the ultimate fate of a Russian cabal’s loot or even the fate of the euro currency itself. This is a significant step on the road away from liberty and sovereignty and toward rule by illiberal global bureaucracies.</p>
<p><strong>Freedom Center pamphlets now available on Kindle: <a href="http://www.amazon.com/s/ref=nb_sb_noss?url=search-alias%3Ddigital-text&amp;field-keywords=david+horowitz&amp;rh=n%3A133140011%2Ck%3Adavid+horowitz&amp;ajr=0#/ref=sr_st?keywords=david+horowitz&amp;qid=1316459840&amp;rh=n%3A133140011%2Ck%3Adavid+horowitz&amp;sort=daterank">Click here</a>.</strong></p>
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		<title>The Left Engineers Another Housing Crisis</title>
		<link>http://www.frontpagemag.com/2012/arnold-ahlert/the-left-engineers-another-housing-crisis/?utm_source=rss&#038;utm_medium=rss&#038;utm_campaign=the-left-engineers-another-housing-crisis</link>
		<comments>http://www.frontpagemag.com/2012/arnold-ahlert/the-left-engineers-another-housing-crisis/#comments</comments>
		<pubDate>Mon, 30 Jul 2012 04:22:46 +0000</pubDate>
		<dc:creator><![CDATA[Arnold Ahlert]]></dc:creator>
				<category><![CDATA[Daily Mailer]]></category>
		<category><![CDATA[FrontPage]]></category>
		<category><![CDATA[Affirmative Action]]></category>
		<category><![CDATA[Banks]]></category>
		<category><![CDATA[financial meltdown]]></category>
		<category><![CDATA[foreclosure]]></category>
		<category><![CDATA[housing crisis]]></category>
		<category><![CDATA[lending]]></category>
		<category><![CDATA[Obama]]></category>

		<guid isPermaLink="false">http://frontpagemag.com/?p=138863</guid>
		<description><![CDATA[The Obama administration again sets minorities up for financial ruin with "social justice" lending regulations. ]]></description>
				<content:encoded><![CDATA[<p><a href="http://cdn.frontpagemag.com/wp-content/uploads/2012/07/real-estate-investment-property-foreclosure-reo.gif"><img class="alignleft size-full wp-image-138869" title="real-estate-investment-property-foreclosure-reo" src="http://cdn.frontpagemag.com/wp-content/uploads/2012/07/real-estate-investment-property-foreclosure-reo.gif" alt="" width="375" height="256" /></a>Apparently for the Obama administration, one economy-busting housing meltdown wasn&#8217;t enough. <a href="http://www.cnbc.com/id/48240142">Studies</a> showing that the foreclosure crisis was more devastating to older black and Hispanic Americans than other groups has prompted another round of government interference in the credit markets&#8211;almost identical to the one that precipitated the first crisis. Once again the perceived bogeyman is &#8220;racist&#8221; lending standards. And once again, banks will be forced to lower their lending standards to make easy credit available for minority loan applicants as a result.</p>
<p>While the idea of browbeating the banks remains the same, the government&#8217;s choice of club has changed. The last round of intimidation was <a href="http://spectator.org/archives/2012/07/27/and-you-thought-the-housing-cr">percipitated</a> largely by the Justice Department and mortgage behemoths Fannie Mae and Freddie Mac. It consisted of banks and mortgage lenders being forced to ease credit requirements for lower-income minorities or face investigations for discrimination, denial of access to the secondary mortgage market, as well as fines and other penalties. This time, the newly created Consumer Finance Protection Bureau (CFPB) will be the government&#8217;s hammer.</p>
<p>The CFPB is the brainchild of Massachusetts Democratic Senate candidate Elizabeth Warren, who like President Obama, is an ardent disciple of the &#8220;you didn&#8217;t do it on your own&#8221; philosophy of all-encroaching government. Thus it should come as little surprise that the CFPB <a href="http://www.nypost.com/f/print/news/opinion/opedcolumnists/obama_house_of_cards_PbEjZZj7LeOZLORaCXJS6K">announced</a> it is adopting as its template the 20-page &#8220;Policy Statement on Discrimination in Lending,&#8221; issued by the Interagency Task force on Fair Lending in 1994. That statement was <a href="http://hotair.com/archives/2011/11/01/bloomberg-to-ows-congress-caused-the-mortgage-crisis-not-the-banks/">signed</a> by the heads of 10 federal agencies, including then-Attorney General Janet Reno, Comptroller of the Currency Eugene Ludwig, Federal Reserve Chairman Alan Greenspan, and the heads of six other financial regulatory agencies. It put lenders on notice that “the agencies will not tolerate lending discrimination in any form.”</p>
<p>The policy was based on a study done by the Boston Fed purporting to show lender &#8220;discrimination,&#8221; due to the fact that mortgage applications by blacks and Hispanics were being rejected in greater proportion than those submitted by whites. Yet a private analysis showed the study was flawed, and that the disparate approval rates were based on the simplest, but apparently inconvenient realities: past delinquencies, a lack of credit standards, an applicants’ net worth, debt burden and employment records, all of which showed that minorities, on average, had higher levels of bad credit and loan defaults, than whites. In other words, sound business practices, not racism was motivating the lenders. This is further revealed by another inconvenient reality: whites could also claim to be victims of &#8220;discrimination&#8221; because their <a href="http://cityroom.blogs.nytimes.com/2008/10/27/fewer-mortgages-for-blacks-and-hispanics-study-finds/">approval rate</a> has been lower than that of Asians in some lending markets.</p>
<p>None of it matters to the racial bean-counters. “Applying different lending standards or offering different levels of assistance to applicants who are members of a protected class is permissible in some circumstances,” the 1994 statement said. “Providing different treatment to applicants to address past discrimination would be permissible if done in response to a court order.” Thus the CFPB is re-instituting the policy. “The CFPB, which did not exist at that time, concurs with the policy statement,” the bureau said in a recent bulletin.</p>
<p>Yet the way they&#8217;re going about enforcing the policy is insidious. Two weeks ago, CFPB chief Richard Cordray, who was granted a recess appointment by President Obama without the necessary senatorial consent, announced that the agency will regulate <em>credit-reporting bureaus</em> that provide the credit scores lenders use to assess the default risk of loan applicants. The impetus behind the move is complaints &#8211; <em>solicited</em> by CFPB &#8212; from minorities who claim their credit has been damaged by faulty reports from the bureaus. The agency contends that only 60 percent of such reports are accurate.</p>
<p>However, a 2011 study by the non-profit, non-partisan Policy and Economic Research Council revealed otherwise, noting that 99.5 percent of the reports are free of material errors, less than 1 percent of credit scores were altered by more than 25 points after a dispute process, and that &#8220;95 percent of disputing participants were satisfied with the outcomes of their disputes, suggesting widespread satisfaction&#8221; with the process. Furthermore, a Federal Reserve review of more than 300,000 credit bureau records from 2007 not only found no bias in scoring, but noted that scores <em>underestimated </em>the risk posed by black American borrowers who showed, on average, &#8220;consistently higher incidences of bad performance than would be predicted” by those scores.</p>
<p>Nonetheless, Cordray revealed the CFPB will re-write the rules determining how the private credit bureaus collate their data. This will be done in conjunction with the leftist Center for Responsible Lending and other housing activist organizations. In short the credit agencies, like the lending institutions before them, will be vetted for racial discrimination, with the likely result being that the agencies will be threatened to raise the credit scores of minorities, or suffer the same consequences imposed on the lending institutions.</p>
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		<title>Your Guide to Sleazy Democratic Party-Backed Banks</title>
		<link>http://www.frontpagemag.com/2012/michellemalkin/your-guide-to-sleazy-democratic-party-backed-banks/?utm_source=rss&#038;utm_medium=rss&#038;utm_campaign=your-guide-to-sleazy-democratic-party-backed-banks</link>
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		<pubDate>Wed, 18 Jul 2012 04:10:17 +0000</pubDate>
		<dc:creator><![CDATA[Michelle Malkin]]></dc:creator>
				<category><![CDATA[Daily Mailer]]></category>
		<category><![CDATA[FrontPage]]></category>
		<category><![CDATA[Banks]]></category>
		<category><![CDATA[Fannie Mae]]></category>
		<category><![CDATA[Freddie Mac]]></category>
		<category><![CDATA[investments]]></category>
		<category><![CDATA[New York Times]]></category>
		<category><![CDATA[Romney]]></category>

		<guid isPermaLink="false">http://frontpagemag.com/?p=137716</guid>
		<description><![CDATA[The Left's shady big bank ties and the Obama supporters who benefit from them. ]]></description>
				<content:encoded><![CDATA[<p><a href="http://cdn.frontpagemag.com/wp-content/uploads/2012/07/620x4341.gif"><img class="alignleft size-full wp-image-137724" title="620x434" src="http://cdn.frontpagemag.com/wp-content/uploads/2012/07/620x4341.gif" alt="" width="375" height="246" /></a>Obama campaign adviser David Axelrod and his hatchet people are still yammering about GOP presidential rival Mitt Romney&#8217;s overseas investments. It&#8217;s time for the Romney campaign to educate voters about all the shady financial institutions embraced by Democrats right here on American soil.</p>
<p>The fat-cat narrative attacks on Republicans won&#8217;t go away by making nice with the White House — or by relying on Beltway journalists to drop their double standards and vet the president&#8217;s own bad bank entanglements. Indeed, The New York Times admitted this week that their staff and other political journalists from every major media outlet submit their work to the White House for unprecedented review, editing and &#8220;veto power.&#8221;</p>
<p>Fortunately, the truth manipulators and message massagers haven&#8217;t gotten to this column yet. So, let&#8217;s talk sleazy Democratic Party-backed banks, shall we?</p>
<p>Fannie Mae/Freddie Mac. Forget Switzerland. The mother and father of all financial industry outrages are rooted in Washington, D.C. And Obama Democrats are among the biggest winners of lavish, out-of-control compensation packages from fraud-plagued Fannie Mae and Freddie Mac. Obama confidante James Johnson raked in $21 million. Former Obama chief of staff and current Chicago Mayor Rahm Emanuel &#8220;earned&#8221; at least $320,000 for a brief 14-month gig at Freddie Mac. And Clinton Fannie Mae head and Obama economic confidante Franklin Raines bagged some $90 million in pay and stock options earned during the government-sponsored institution&#8217;s Enron-style accounting scandal on the public dime.</p>
<p>Self-appointed banking policewoman and DNC Chair Debbie Wasserman Schultz has, uncharacteristically, kept her mouth shut about these wealthy barons.</p>
<p>Superior Bank. One of the Obamas&#8217; oldest Chicago friends and wealthiest billionaire bundlers, former Obama national finance chairwoman Penny Pritzker, headed up this subprime lender. Even after it went under in 2001 and left 1,400 customers destitute, Pritzker was pushing to expand its toxic subprime loan business. Pritzker and her family escaped accountability by forking over $460 million over 15 years. Obama happily accepted the nearly $800 million in campaign and inaugural funding Pritzker drummed up for him. To protect her family&#8217;s multibillion dollar fortune, Pritzker&#8217;s enterprises park their money in the very same kind of offshore trusts her candidate is attacking Romney over.</p>
<p>Broadway Bank. In 2010, President and Mrs. Obama personally raised money for their Chicago friend and fundraiser Alexi Giannoulias. As I reported then, Giannoulias&#8217; Greek immigrant family founded Chicago-based Broadway Bank, a now-defunct financial institution that loaned tens of millions of dollars to convicted mafia felons and faced bankruptcy after decades of engaging in risky, high-flying behavior. It&#8217;s the place where Obama parked his 2004 U.S. Senate campaign funds. And it&#8217;s the same place where a mutual friend of Obama and Giannoulias — convicted Obama fundraiser and slumlord Tony Rezko — used to bounce nearly $500,000 in bad checks written to Las Vegas casinos.</p>
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		<title>Washington Times – Report: Bernanke, Paulson misled on bailouts</title>
		<link>http://www.frontpagemag.com/2009/mb-snow/washington-times-%e2%80%93-report-bernanke-paulson-misled-on-bailouts/?utm_source=rss&#038;utm_medium=rss&#038;utm_campaign=washington-times-%25e2%2580%2593-report-bernanke-paulson-misled-on-bailouts</link>
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		<pubDate>Mon, 05 Oct 2009 06:08:02 +0000</pubDate>
		<dc:creator><![CDATA[MB Snow]]></dc:creator>
				<category><![CDATA[Bailout]]></category>
		<category><![CDATA[Bank of America]]></category>
		<category><![CDATA[Banks]]></category>
		<category><![CDATA[Bernanke]]></category>
		<category><![CDATA[Federal Reserve]]></category>
		<category><![CDATA[News]]></category>
		<category><![CDATA[Paulson]]></category>
		<category><![CDATA[Politics]]></category>

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		<description><![CDATA[Report: Bernanke, Paulson misled on bailouts
Monday, October 5, 2009

Sean Lengell
Federal Reserve Chairman Ben S. Bernanke and former Treasury Secretary Henry M. Paulson Jr. misled the public about the financial weakness of Bank of America and other early recipients of the government&#8217;s $700 billion Wall Street bailout, creating &#8220;unrealistic expectations&#8221; about the companies and damaging the [...]<img alt="" border="0" src="http://stats.wordpress.com/b.gif?host=sroblog.com&#038;blog=5470193&#038;post=16734&#038;subd=ladylibertytoday&#038;ref=&#038;feed=1" />]]></description>
				<content:encoded><![CDATA[<div class="snap_preview">
<h2><strong><img class="aligncenter size-medium wp-image-16736" title="paulson-bernanke" src="http://ladylibertytoday.files.wordpress.com/2009/10/paulson-bernanke.jpg?w=300&amp;h=193" alt="paulson-bernanke" width="300" height="193" />Report: Bernanke, Paulson misled on bailouts</strong></h2>
<h4><strong><span style="font-weight:normal;">Monday, October 5, 2009</span><br />
</strong></h4>
<p>Sean Lengell</p>
<p>Federal Reserve Chairman Ben S. Bernanke and former Treasury Secretary Henry M. Paulson Jr. misled the public about the financial weakness of Bank of America and other early recipients of the government’s $700 billion Wall Street bailout, creating “unrealistic expectations” about the companies and damaging the program’s credibility, according to a report by the program’s independent watchdog.</p>
<p>The federal government last October loaned Bank of America and eight other “healthy” financial institutions a total of $125 billion – the initial payout from the Troubled Asset Relief Program, or TARP – in an attempt to avoid a series of major bank collapses that would push the sputtering economy into a free fall or depression.</p>
<p>The rationale for giving money to stable banks and not failing ones, regulators said, was that such institutions would be better able to lend money and thus unfreeze tight credit markets – a major factor in last year’s Wall Street losses.</p>
<p>But an audit released Monday by TARP Special Inspector General Neil Barofsky says senior government officials and Wall Street regulators, including Mr. Bernanke and Mr. Paulson, had “affirmative concerns” that several of the nine institutions were financially shaky.</p>
<p>via <a href="http://www.washingtontimes.com/news/2009/oct/05/report-bernanke-paulson-misled-on-bailouts//print/">Washington Times – Report: Bernanke, Paulson misled on bailouts</a>.</p>
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