Big Lie

Why Police Lie Under Oath

"Are police officers necessarily more trustworthy than alleged criminals? I think not. Not just because the police have a special inclination toward confabulation, but because, disturbingly, they have an incentive to lie. In this era of mass incarceration, the police shouldn’t be trusted any more than any other witness, perhaps less so. Agencies receive cash rewards for arresting high numbers of people for drug offenses, no matter how minor the offenses or how weak the evidence. Law enforcement has increasingly become a numbers game. And as it has, police officers’ tendency to regard procedural rules as optional and to lie and distort the facts has grown as well." Continue reading →

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Chief Greek Statistician Threatened with Jail For Revealing True Size of Deficit

"At a time when the rest of the world was furious that Greece had artificially improved the country's budget statistics, Greek prosecutors are accusing Georgiou of doing the opposite. Prosecutors acted after a 15-month investigation into allegations made by a former ELSTAT board member. If found guilty, Georgiou faces five to 10 years in prison. Some argue that the technocrat Georgiou was serving his former superiors at the IMF and the European statistics agency Eurostat, which is led by a German. This theory holds that Greece was to be brought to its knees by imposing harsh austerity measures based on bloated deficit figures." Continue reading →

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How A Rookie Excel Error Led JPMorgan To Misreport Its Risk For Years

"If this glaringly amateur error was present in America's largest bank by assets, and one which proudly boasts a 'fortress balance sheet', an error which just so happens feeds into countless other input cells driven by the firm's VaR calculation, leading to capital allocation, trading, and overall executive decisions many of which have a direct impact on the firm's exposure to $72 trillion in over the counter derivatives, what can one say about the thousands of other banks, which are not as closely 'supervised' by the Federal Reserve as JPMorgan is (supposedly)." Continue reading →

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Many 2011 federal budget cuts had little real-world effect

"In the real world, in fact, many of their 'cuts' cut nothing at all. The Transportation Department got credit for 'cutting' a $280 million tunnel that had been canceled six months earlier. It also 'cut' a $375,000 road project that had been created by a legislative typo, on a road that did not exist. At the Census Bureau, officials got credit for a whopping $6 billion cut, simply for obeying the calendar. They promised not to hold the expensive 2010 census again in 2011. Today, an examination of 12 of the largest cuts shows that, thanks in part to these gimmicks, federal agencies absorbed $23 billion in reductions without losing a single employee." Continue reading →

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Paul Craig Roberts: It Has Happened Here

"Some Americans claim that we have had police states during other wartimes and that once the war on terror is won, the police state will be dismantled. Others claim that government will be judicious in its use of the power and that if you are doing nothing wrong you have nothing to fear. These are reassurances from the deluded. The Bush/Obama police state is far more comprehensive than Lincoln’s, Wilson’s, or Roosevelt’s, and the war on terror is open-ended and is already three times longer than World War II. The Police State is acquiring 'squatter’s rights.' Moreover, the government needs the police state in order to protect itself from accountability." Continue reading →

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Investing In a World of Make Believe

"In recent years, a high degree of economic, financial, and political uncertainty has resulted in acute volatility in stocks, real estate, commodities and precious metals. I believe that another aggravating factor has been the increasing skepticism through which the investing public views government statistics and statements. To make prudent decisions, investors need to know key economic indicators such as economic growth, inflation rates, unemployment levels and the real cost and value of money. For the past 20 years or so, the key assumptions behind the calculation of these figures have been distorted in favor of government image." Continue reading →

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Depreciating Dollar Not Good For People, But Good for ‘the Economy’?

"All the nations are inflating, so that their exporters will not suffer from an appreciating currency. Central bankers regard appreciating currency as a disaster. They are mercantilists. Yet we know that, as individuals, to hold on to an appreciating currency is a great thing. Why is it a great thing for individuals to hold an appreciating currency, yet it is also a good policy for a central bank to expand the money supply, so as to decrease the international value of the currency? There seems to be something wrong here. There seems to be cognitive dissonance." Continue reading →

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The Fed’s Asset-Inflation Machine

"Winners on stocks or land holdings should happily accept their gains as the best to be expected in a very unsettled financial environment. But they should also remember the 2000s, when so many people thought their newfound riches were real and cashed them in for yet more debt, such as home-equity loans. They later had a rude awakening. The 'wealth illusion' of asset inflation is seductive, which is why central banks in charge of a fiat currency and subject to no external disciplines so often drift in that direction. Politicians smile in satisfaction and powerful Washington lobbies cry for more. But an economy built on an illusion is hardly a sound structure." Continue reading →

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Why S&P is in the Crosshairs of the Department of Justice

"It was S&P that took the heat in August of 2011, being first to actually cut the nation's rating to AA+. At the time the Obama administration lashed out at S&P, launching an unprecedented attack, specifically accusing the agency of 'misleading calculations.' Some now speculate that the Obama administration is merely getting revenge on S&P's downgrade by taking legal action against the rating agency. But it is also plausible that the Obama administration made a shrewd political calculation in taking this action. The Obama Justice Department's suit puts Moody's and Fitch on notice that they had better behave." Continue reading →

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Exposing the Absurdity of Washington’s Anti-Sequester Hysteria

"To save America from the supposedly 'savage' and 'draconian' budget cuts caused by sequestration, President Obama has instead asked Congress to approve an alternative fiscal package containing additional tax increases. So why is the sequester so bad? Does it slash the budget by 50 percent? Does it shut down departments, programs, and agencies? Well, the Congressional Budget Office today released its annual Budget and Economic Outlook, and Tables 1-1 and 1-5 allow us to see the 'brutal' impact of the sequester. As you can see from this chart, the sequester will 'cut' spending so much that the budget will grow by 'only' $2.4 trillion over the next 10 years." Continue reading →

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