Ex-lawmaker charged as terrorist conspirator

Former congressman accused of supporting fundraising ring

The Associated Press

updated 4:18 p.m. ET, Wed., Jan. 16, 2008

WASHINGTON - A former U.S. congressman and delegate to the United Nations was indicted Wednesday, accused of being part of a terrorist fundraising ring that allegedly sent more than $130,000 to an al-Qaida and Taliban supporter who has threatened U.S. and international troops in Afghanistan.

The former Republican congressman from Michigan, Mark Deli Siljander, was charged with money laundering, conspiracy and obstructing justice for allegedly lying about lobbying senators on behalf of an Islamic charity that authorities said was secretly sending funds to terrorists.

A 42-count indictment accuses the Islamic American Relief Agency of paying Siljander $50,000 for the lobbying — money that turned out to be stolen from the U.S. Agency for International Development.

Siljander, who served four years in the U.S. House of Representatives, was appointed by President Ronald Reagan to serve as a U.S. delegate to the United Nations for one year in 1987.

He could not immediately be reached for comment Wednesday, and his attorney in Kansas City, JR Hobbs, had no immediate comment.

Case against Islamic charity
The charges are part of a long-running case against the charity, which was designated by the Treasury Department in 2004 as a suspected fundraiser for terrorists.

In the indictment, the government alleges that the charity employed a man who had served as a fundraising aide to Osama bin Laden.

The indictment charges the charity with sending approximately $130,000 to help Gulbuddin Hekmatyar, whom the United States has designated as a global terrorist. The money, sent to bank accounts in Peshawar, Pakistan in 2003 and 2004, was masked as donations to an orphanage located in buildings that Hekmatyar owned.

Authorities described Hekmatyar as an Afghan mujahedeen leader who has participated in and supported terrorist acts by al-Qaida and the Taliban. The Justice Department said Hekmatyar "has vowed to engage in a holy war against the United States and international troops in Afghanistan."

The charges "paints a troubling picture of an American charity organization that engaged in transactions for the benefit of terrorists and conspired with a former United States congressman to convert stolen federal funds into payments for his advocacy," said Assistant Attorney General Kenneth Wainstein.

Siljander founded Washington-area consulting group Global Strategies, Inc. after leaving the government.

© 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

URL: http://www.msnbc.msn.com/id/22686544/

Our Rulers Are Compiling Digital Evidence Against Us

Kurt Nimmo
Truth News
January 15, 2008

It’s a fantastic activism tool: impromptu groups such as We Are Change confront a former president or a corporate media anchor and within a few hours a video appears on the internet for millions of people to see.

Be forewarned, though, because soon enough all of this will be used against you for crimes against the state, thanks to National Intelligence director Mike McConnell.

“If you’re worried about online privacy, try this on for size,” writes p2pnet.net. “US intelligence agencies may soon have access to any and all emails, file transfers or web searches.”

“The proposals from National Intelligence Director Mike McConnell, which have entered into a draft of US Cyber-Security Policy, would legitimize data trawling on a scale that would make the current controversy about warrantless wiretapping seem like much ado about nothing,” the Register explains. “Intelligence agencies have long angled for this kind of surveillance ability. The infrastructure and computing power needed to tap into Americans’ email and web search history may already exist. However a change of president, to say nothing of a Democratic Congress, may represent a block on such ambitions.”

Oh, road apples. It will roll through Congress like a run-away freight train and land on whatever selected president’s desk for signature and enactment, that is unless the next president is Ron Paul.

Of course, this formality will simply codify what is already going on, as the government has snooped our communications for decades now. Lawrence Wright, writing for the New Yorker, suggests “that this kind of monitoring is already going on. He spoke to an AT& T employee, Mark Klein, who claimed that he installed data switching systems in the company’s exchange that copied all internet traffic to the National Security Agency.” Klein “claimed that he installed data switching systems” for this very purpose.

If you think this effort is to track down a dead and buried al-Qaeda leader and his motley crew of cave-dwelling Muslims, I have a bridge to sell you in the Sonoran Desert.

It’s was designed and deployed to keep tabs on you, so if you don’t want to be inserted in the government’s terrorist database, you best stay away from the We Are Change website, Infowars, and the site where you are now reading this, to name but three. Chances are you’re in calmer, safer, and less shark infested waters surfing porno websites.

In the old days, in East Germany, the Stasi used civilian informants to snoop and infiltrate all aspects of life. It is said one in every seven East Germans worked for the secret police. It was highly effective in snuffing out dissent.

But all of that pales in comparison with the high-tech snoop system now in place here in the United States. If you use a telephone, send email, or cruise the web you have a virtual electronic Stasi informer looking over your shoulder at all times. Not even Orwell imagined such an effective and fearsome system for monitoring citizens.

For now, you will be allowed to read those articles on Prison Planet. But keep in mind that a massive database housed on a networked series of super-duper liquid nitrogen cooled Cray computers somewhere in the basement of the NSA, CIA, or the Pentagon — or all three and then some — are actively cataloging every URL you visit, every email you send urging a coworker or relative to investigate the 9/11 inside job, every phone call you make regardless of content. Moments after I post this on Truth News, it will be tucked away for future reference, part of an electronic dossier that may be used against me at any moment.

In the not too distant future, our Volksgerichtshof, or People’s Court, will likely parallel in ominous ways the one created by Hitler and the Nazis to convict citizens of “political offenses” and high treason against the fascist state. Such a kangaroo court is but one “terrorist event” away from convening. Our domestic Gitmos in the guise of FEMA camps await.

In the meantime, our rulers are quietly assembling the evidence against you.

If you want to be safe, you may want to click off this page now and surf over to PornoTube.

Report: Chinese ships confronted Kitty Hawk

Kyodo News
Wednesday January 16, 2008

TAIPEI — A Chinese attack submarine and destroyer shadowed U.S. warships in November in the Taiwan Strait, sparking a 28-hour standoff that brought the group to a battle-ready halt in the tense waters, a report in a Taiwan daily said Tuesday.

The confrontation occurred as the Navy aircraft carrier Kitty Hawk and other ships in its battle group were heading back to Japan following China’s sudden cancellation of a long-scheduled holiday port call in Hong Kong, the China Times said, citing U.S. military sources.

The carrier strike group encountered Chinese destroyer Shenzhen and a Song-class sub in the strait on Nov. 23, causing the group to halt and ready for battle, as the Chinese vessels also stopped amid the 28-hour confrontation, the Chinese-language daily reported.

The Kitty Hawk battle group had planned to pass the Thanksgiving holiday in Hong Kong as it had done in previous years, but China refused it entry without giving a reason.

By the time China reversed its decision, the U.S. ships had already turned around and headed for their home port in Japan. China later told the U.S. that its earlier refusal was a “misunderstanding.”

But that incident came on the heels of China’s refusal of safe harbor in Hong Kong for two Navy minesweepers seeking refuge from a brewing storm. Due to that refusal, the ships had to get refueled at sea so they could return to their home port in Sasebo, Japan.

The two incidents have ruffled feathers in Washington.

Adm. Timothy Keating, who heads the U.S. Pacific Command, is in Beijing this week to discuss what he has called China’s “perplexing” refusals, its worrisome weapons programs and U.S.-China military ties.

He told reporters Tuesday that U.S. warships will cross through the Taiwan Strait whenever they choose to.

“We don’t need China’s permission to go through the Taiwan Strait,” Keating said, stressing that it is international waters. “We will exercise our free right of passage whenever and wherever we choose.”

China has expressed its “grave concern” to the U.S. over the Kitty Hawk’s transit through the Taiwan Strait.

Beijing claims Taiwan as its own, vowing to attack the self-ruled island if it moves to formalize its de facto independence.

The U.S., Taiwan’s chief security benefactor, is legally obligated to help defend the island in the face of Chinese saber-rattling.

In 2006, a Chinese attack sub stalked the Kitty Hawk without being detected until it surfaced within firing range of the group.

Last November’s incident, however, could have been unintentional as the Shenzhen was also headed to Tokyo for an historic port call there, just as the Kitty Hawk was denied Hong Kong entry.

Destroyers are known to travel with a submarine escort.

The confrontation ended without incident as all vessels continued on course toward Japan by Nov. 24.

Microsoft is developing Big Brother-style software capable of monitoring workers' competence and productivity

UK Daily Mail
Wednesday January 16, 2008

Microsoft is developing Big Brother-style software capable of remotely monitoring a worker's productivity, competence and physical wellbeing, it was revealed today.

A patent application has been filed by the company for a computer system that links workers to their computers via wireless sensors that measure their metabolism.

The system would allow managers to monitor their employees' performance by measuring their body temperature, heart rate, movement, facial expression and blood pressure.

But unions are concerned that employees could be sacked on the basis of the computer's assessment of their physiological state.

It is understood that this is the first time that a company has proposed to devlop this big-brother-style software for mainstream workplaces.

Similar monitoring technology has previously been limited to pilots, firefighters and Nasa astronauts.

Microsoft has submitted a patent application in the US for a "unique monitoring system" that could link workers to their computers.

The application states that wireless sensors could read heart rate, brain signals, respiration rate, body temperature movement, facial movements, facial expressions and blood pressure.

The system could also "automatically detect frustration or stress in the user" and "offer and provide assistance accordingly."

Full article here.

Ron Paul Beats Fred and Rudy in Michigan

DigitalBob
Nolan Chart
Wednesday January 16, 2008

Watching the Michigan returns come in on CNN and Fox News, it was clear that Ron Paul wasn't going to get more than about 7% and finish in fourth placed after Romney, McCain, and Huckabee. For a candidate that wasn't worthy to get an invitation to the Fox News debate before the New Hampshire primary, he finished ahead of two other candidates who did.

In a previous article, I mentioned that there is a Ron Paul Mendoza Line, where a candidate must at least beat Ron Paul, or should consider getting out. As of tonight, Rudy Giuliani, Fred Thompson, and Duncan Hunter have all fallen below that line. Unlike Paul, with his fanatical grassroots supporters, these candidates do not have backers who will raise millions of dollars in a single day to keep a second-place or worse finish going. Even Mike Huckabee ought to be bleeding at the edges of his campaign coffers by now. We'll know at the end of the month when the FEC reports come out. Paul and Romney are the only ones with the cash to keep going beyond Feb 5--even if they don't win another state by then.

Before Super Tuesday, there are just a few states to go. These candidates need to win one by then, or may have to go home.

Thompson is probably putting all his eggs in a South Carolina basket. He has stiff competition from Huckabee. It will be a battle between who is most Southern. Will it be the preacher-governor from Arkansas or the attorney-actor-Senator from Tennessee? At USAElectionPolls.com, John McCain has been surging there lately. But Huckabee has polled ahead of Thompson consistently since November.

Giuliani has two states where he can make a last stand: Nevada and Florida. Giuliani pulled his office out of Michigan in a frugal move when it became clear that he couldn't win the state. It may be paying off. In Florida, he's in a four-way tie with the top three finishers from Michigan. But Thompson and Paul aren't far behind. He had Nevada to himself, until McCain's recent surge.

Although Duncan Hunter is still on ballots, he really needs to decide where to make a graceful exit. He has to figure out when to write the last campaign paycheck or apply for matching funds. There are just so many stops he can make on frequent flyer miles. He made his point with building the fence in San Diego. He's still pushing his trade message, which the other candidates need to incorporate. "Mirror Trade" seems much more fair than the current system. He might want to negotiate a cabinet position for an endorsement.

So where does that put Ron Paul? He needs to make some serious staff changes. He's got to get his message out to convert "normal" voters to his point of view. Fast. His rabid internet minions will follow him up to and through the gates of hell--even the atheists. He's got to get beyond some of us economic nerds who let out a war whoop every time he advocates getting rid of the Federal Reserve and the IRS. Huckabee's Michigan concession speech last night came right out of Ron Paul's press releases. When the candidates want to look economically conservative, they cherry pick Paul's platform. Maybe James Carville is available for a consult? His recent free advice seems spot-on with the three GOP winners so far. Ron Paul's got to place at least third in a state or two before Feb. 5.

We'll see who's left standing Feb 6. It will be a long fight to the convention by those who can win a few states on Super Tuesday, and have some cash on hand.

Diebold Machine Rejects Ron Paul Votes In Michigan

Ron Paul War Room
Wednesday January 16, 2008

From Ron Paul Supporter Michigan below

Voter #1 Genoa Township, Michigan Precinct 3. Voting problems?
Posted January 15th, 2008 by LettenYouKnow
First observation…
-Diebold

I was the first voter, I circled in Ron Paul and put my ballot into the machine. Spit it right back out and said INVALID BALLOT.

Second guy gives it a shot. INVALID BALLOT.

I begin arguing with the lady running the precinct about computer voting and people voting. This lady actually says in a room full of people that Computers are better at counting ballots than people, cause people make mistakes. who makes computers?

So to finish it up, she calls the township. she says I can keep my ballot in a secret compartment and they will put it through later once its fixed.

So they call her back. She gets off the phone. She says the manufacturer says there is a problem with a memory card. Someone from the manufacturer will be there with a new memory card soon.

It doesn’t help that I just watched a darn documentary about DIEBOLD and MEMORY CARDS.

I immediately left and drive to the township office to voice my complaints. They must still be sleeping.

Inflation Rate Is Worst in 17 Years

By MARTIN CRUTSINGER – 1.16.2008

WASHINGTON (AP) — Higher costs for energy and food last year pushed inflation up by the largest amount in 17 years, even though prices generally remained tame outside of those two areas. Meanwhile, industrial output was flat in December, more evidence of a significant slowdown in the economy.

Consumer prices rose by 4.1 percent for all of 2007, up sharply from a 2.5 percent increase in 2006, the Labor Department said Wednesday. Consumers felt the pain when they filled up their gas tanks or shopped for groceries. Prices for both energy and food shot up by the largest amount since 1990.

In a second report, the Federal Reserve said that output at the nation's factories, mines and utilities showed no growth in December, adding to a string of weak economic reports showing that the economy was slowing at the end of last year.

The unchanged output in December was the poorest showing since industrial output actually fell by 0.5 percent in October. Output had been up by 0.3 percent in November.

The December weakness reflected flat output at U.S. factories, a tiny 0.1 percent rise in the mining industry and a 0.2 percent drop at the nation's utilities.

The Consumer Price Index rose by 0.3 percent in December, slower than the 0.8 percent in November, as food costs were flat for the month and energy prices rose by 0.9 percent after an even bigger 5.7 percent jump in November.

Outside of food and energy, inflation rose a more moderate 0.2 percent in December. This measure of core inflation rose by 2.4 percent for all of 2007, down slightly from a 2.6 percent increase in 2006.

The Federal Reserve is closely watching to see whether the jump in food and energy becomes more widespread and starts pushing core inflation higher.

Analysts said that with core prices generally remaining well-behaved, it will give the central bank the leeway to cut interest rates further to battle a serious economic slowdown triggered by a steep slump in housing and a spreading credit crisis.

The expectation is that the Fed will cut a key rate by a half-point when officials meet at the end of this month. Federal Reserve Chairman Ben Bernanke raised hopes for further rate cuts in a speech last week when he said that economic risks had grown significantly in recent weeks.

The rising risk of a recession has prompted politicians to consider stimulus packages to give the economy a jump-start to either prevent a recession or at least mitigate its fallout. President Bush has said he may unveil a plan around his Jan. 28 State of the Union address. Democrats in Congress and presidential candidates in both parties are putting forward their own plans.

The CPI report showed that the 4.1 percent increase in overall prices was the biggest since a 6.1 percent jump in prices in 1990.

Energy costs rose by 17.4 percent this past year while food costs rose by 4.9 percent. Both were the biggest increases since 1990. Gasoline prices were up 29.6 percent, the biggest increase since they soared by 30.1 percent in 1999.

The 2.4 percent rise in prices outside of food and energy was the smallest since a 2.2 percent rise in 2005.

Clothing costs and the price of new cars actually fell for the year, both dropping by 0.3 percent, while airline fares, reflecting higher fuel costs, were up 10.6 percent and medical care, always one of the leading areas of price increases, rose by 5.2 percent for 2007.

Workers' wages failed to keep up with the higher inflation. Average weekly earnings, after adjusting for inflation, dropped by 0.9 percent in 2007, the biggest setback since a 1.5 percent fall in 2005.

Heads up: Federal Reserve auctions $30 billion in funds to banks

Tue, Jan. 15, 2008 10:15 PM The Associated Press

The Federal Reserve, working to combat the credit crisis, auctioned $30 billion in funds to commercial banks at an interest rate of 3.95 percent. It was the third in a series of auctions the Fed began last month as a way to provide cash-strapped banks the reserves they need. The 3.95 percent interest rate was the lowest of any of the three auctions so far.

Not liable

The Supreme Court ruled Tuesday against investors who sue businesses that help manipulate stock prices of publicly traded companies. The 5-3 decision gave a measure of protection from securities lawsuits to suppliers, banks, accountants and law firms that do business with corporations engaging in securities fraud.

Applied pain

Applied Materials Inc., a big supplier of computer-chip-making equipment, is jettisoning 1,000 jobs, a 7 percent cutback that suggests some manufacturers are hunkering down for a recession. The cuts announced Tuesday are Applied Materials’ biggest retrenchment since November 2002.

Figures confirm retailers had little holiday cheer

Report calls it worst Christmas season in 5 years

By MARTIN CRUTSINGER
Associated Press

WASHINGTON — Consumer spending, the critical bulwark that has kept the country out of recession, is showing signs of cracking. Retail sales plunged by 0.4 percent last month as consumers handed retailers their worst Christmas in five years. Consumers have been battered by a sinking housing market, rising unemployment and the credit crunch.

The Commerce Department's sales report Tuesday was just the latest in a string of weaker-than-expected numbers that have economists worried that the current economic expansion, now in its seventh year, is faltering.

Analysts said the worry is that all the problems weighing on the economy could prompt consumers — who account for two-thirds of economic activity — to sharply limit or even stop shopping. Already, consumer confidence has slipped significantly amid the oil price spiral and the continuing housing slump. At the same time, some of the nation's biggest financial institutions have reported billions of dollars in losses stemming from a meltdown in the mortgage market.

Former Federal Reserve Chairman Alan Greenspan said the country may already be in a downturn.

"The symptoms are clearly there," he said in a Wall Street Journal interview. "Recessions don't happen smoothly. They are usually signaled by a discontinuity in the marketplace, and the data of recent weeks could very well be characterized in that manner."

Stock prices, one of the leading indicators used to judge the course of the economy, continued their 2008 swoon.

9-month low for Dow

The Dow Jones industrial average fell 277.04 points to close at 12,501.11, the lowest close in nine months. Investors were rattled by an announcement from Citigroup that it had sustained a nearly $10 billion loss in the fourth quarter, reflecting in part the mortgage market.

Broader stock indicators also lost ground. The Standard & Poor's 500 index dropped 35.30 to 1,380.95, and the Nasdaq composite index lost 60.71, closing at 2,417.59.

In other news Tuesday, the Labor Department said wholesale inflation, which had shot up in November by 3.2 percent, the largest amount in 34 years, dipped by 0.1 percent in December. That reflected a drop in energy costs at the time. However, for all of 2007, wholesale prices rose by 6.3 percent, the biggest annual increase in 26 years.

Analysts said the dip in wholesale prices for December, if followed by a benign report today on consumer prices, should give the Federal Reserve the leeway it needs to more aggressively attack the slowdown with interest rate cuts.

Federal Reserve Chairman Ben Bernanke last week sent a strong signal that the central bank is more worried at the moment about weak growth than inflation, prompting markets to believe the Fed will cut a key interest rate by a half-point at the end of this month.

Favoring Democrats' plans

Also Tuesday, the Congressional Budget Office said economic stimulus proposals favored by Democrats, including tax rebates, extended unemployment benefits and a temporary increase in food stamps, are cost-effective ways for Congress to try to lift the economy.

At the same time, the office said, some options floated by Republicans such as extending President Bush's tax cuts, cutting corporate tax rates and giving businesses new incentives to invest may be less cost-effective in the short term.

The nonpartisan Congressional Budget Office echoed the views of many economists who say the most effective way to stimulate the economy is to provide money — through tax cuts or direct payments such as food stamps — to people most likely to spend it quickly.

JPMorgan Fourth-Quarter Earnings Fall, Miss Estimates (Update4)

By Elizabeth Hester

Jan. 16 (Bloomberg) -- JPMorgan Chase & Co., the third- biggest U.S. bank, said profit dropped 34 percent on subprime- mortgage writedowns and higher provisions for future loan defaults.

Fourth-quarter net income declined to $2.97 billion, or 86 cents a share, from $4.53 billion, or $1.26, a year earlier, the New York-based bank said today in a statement. JPMorgan rose as much as 6.8 percent in New York trading as the $1.3 billion writedown was smaller than analysts estimated.

The profit decline, the first since Jamie Dimon became chief executive officer in 2005, came as trading revenue fell and JPMorgan prepared for what it said may be a substantial weakening in the U.S. economy. The company added $2.3 billion to credit reserves, bringing the total to $10 billion. Citigroup Inc., the biggest U.S. bank, said yesterday it added $5.2 billion to cover U.S. loan losses and took an $18.1 billion writedown.

``We remain extremely cautious as we enter 2008,'' Dimon, 51, said in the statement. ``If the economy weakens substantially from here -- for which, as a company, we need to be prepared --it will negatively affect business volumes and drive credit costs higher.''

JPMorgan gained $1.68, or 4.3 percent, to $40.85 in composite trading on the New York Stock Exchange at 10:28 a.m.

``Their diversified business model really continues to separate JPMorgan from a lot of their peers,'' said William Fitzpatrick, an analyst at Racine, Wisconsin-based Optique Capital Management, which oversees $1.7 billion including JPMorgan shares.

Revenue Increase

Revenue climbed 7 percent to $17.4 billion, compared with the average estimate of $17.2 billion in the Bloomberg survey. Profit fell short of the 92-cent average estimate of 17 analysts surveyed by Bloomberg. Last year's fourth-quarter earnings included a one-time gain of $622 million.

Net income at the investment-banking division tumbled 88 percent to $124 million in the fourth quarter, as credit-market turmoil reduced revenue from debt underwriting 39 percent, to $467 million. Fixed-income revenue tumbled 70 percent because of the writedown, to $615 million, and ``weaker trading results'' contributed to a 40 percent drop in equity market revenue, which fell to $578 million.

The retail bank's profit climbed 5 percent to $752 million, driven by increases in mortgage banking. Those gains were tempered by declines in the home-equity and auto-loan businesses. Charge-offs on home-equity loans totaled $248 million. Profit from auto loans was $49 million, a 25 percent drop from a year earlier.

Credit Costs

Dimon said on a conference call with analysts that he isn't predicting a U.S. recession, though credit costs will increase as the economy weakens.

JPMorgan earned 15 percent less from its card services business, as its provision for future losses rose 40 percent to $1.79 billion.

Return on equity from continuing operations, a gauge of how effectively the company reinvests earnings, was 10 percent, compared with 14 percent a year earlier.

JPMorgan lost 18 percent of its market value in the past 12 months, compared with 50 percent at New York-based Citigroup and 29 percent at Charlotte, North Carolina-based Bank of America Corp.

JPMorgan's Tier 1 capital ratio, which regulators monitor to assess banks' ability to withstand loan losses, remained unchanged from the third quarter at 8.4 percent.

Rating Downgrade

Deutsche Bank AG analyst Michael Mayo reduced his rating on JPMorgan to ``hold'' from ``buy'' yesterday ``due to accelerating problems in U.S. consumer banking.'' Losses from credit cards and mortgages are increasing as the global economy slows. Citigroup said yesterday its record $9.83 billion loss was due in part to an increase in provisions for losses on auto and credit-card loans.

``We feel that JPMorgan cannot escape tougher external conditions,'' Mayo wrote in his research note.

Richard Bove, an analyst at Punk Ziegel & Co. in Lutz, Florida, said JPMorgan may capitalize on its relative success in protecting its capital by purchasing another bank. Bove pointed to Seattle-based Washington Mutual Inc., the biggest savings and loan, as one possibility.

Dimon said on the conference call that he's ``open-minded'' about the possibility of acquiring other banks, and the current market environment makes such a takeover more likely.

Leveraged Buyouts

JPMorgan arranged $170 billion of loans used to finance leveraged buyouts in the U.S. last year, more than any bank and representing 16 percent of the market, according to data compiled by Bloomberg. The company was also the largest underwriter of U.S. high-yield corporate debt, with $20 billion in 2007.

The fourth quarter may be the worst earnings period for the financial industry since the Great Depression. Analysts estimate Merrill Lynch & Co., the biggest U.S. brokerage, will report a record loss tomorrow of more than $3 billion after writing down the value of mortgage-related securities. Bank of America, the second-largest U.S. bank by assets after Citigroup, may report its biggest profit decline since its formation in 1998 from the merger of BankAmerica and NationsBank.

To contact the reporter on this story: Elizabeth Hester in New York at ehester@bloomberg.net .

Former CIA Official Will Not Testify on Destroyed Interrogation Tapes

By VOA News 16 January 2008

A former CIA official who is believed to have ordered the destruction of videotapes showing interrogations of suspected al-Qaida terrorists will not testify at a U.S. Congressional hearing Wednesday.

The lawyer for Jose Rodriguez said his client will not appear at the closed hearing before the U.S. House Intelligence Committee. The lawyer has reportedly been seeking full immunity in exchange for Rodriguez' testimony.

Lawmakers had subpoenaed Rodriguez, who is the former head of the CIA's clandestine branch, regarding his role in the destruction of interrogation tapes in 2005.

Top CIA lawyer John Rizzo is scheduled to appear before the House panel Wednesday.

The CIA said the tapes were destroyed to protect the identities of the interrogators. Critics allege they were destroyed to hide evidence of torture.

The tapes showed the interrogations of suspected al-Qaida members Abu Zubaydah and Abd al-Rahim al-Nashiri and are reported to show an interrogation technique known as waterboarding, or simulated drowning.

The U.S. Justice Department has launched a criminal investigation into the destruction of the tapes.

Some information for this report was provided by AP and Reuters.

We've run out of bubbles

Booms and busts are natural to capitalism, but for years now an irresponsible Fed has interfered with the down cycle. The only choice now may be to let nature take its course.

msn money 1/14/2008
By Bill Fleckenstein

Are the bulls in hibernation?

I'll begin the new year with this comment: There are no bullish interpretations for the stock market's action thus far. This tells us that 2008 will be the year when reality finally overtakes the Goldilocks crowd.

Of course, we should expect the bulls to regale us with stories about a proverbial second-half rebound -- the possibility of which is approximately zero, in my opinion. We should also expect believers in that hypothesis to spark a rally from time to time, based on hopes of surprise interest-rate cuts and on actual cuts.

But their efforts will become progressively less effective. (Anyone seeking a road map to how that might evolve can look at the market's responses to the rate cuts from 2000 through 2002.)

Irresponsible liquidity originally emanating from the Federal Reserve and then-chief Alan Greenspan (a subject I cover thoroughly in my soon-to-be-published book), coupled with reckless acts of deregulation, have created the problem we now face. The country has gone "all in" via the credit-bubble-inspired housing bubble, which is now unwinding.

I do not believe there is a potential bubble left that could bail us out, nor do I believe a bailout should be attempted. Likewise, I do not believe any quick fix exists.

What I do see as the real solution is to let the creative destruction of capitalism finally run its course, after having been held back for a couple of decades.

I know I've said it before, but it bears repeating: Capitalism involves booms and busts. There is a phenomenon known as the business cycle that loosely revolves around those booms and busts. The policies of Greenspan and the Fed suppressed those busts, and "risk" was more or less struck from the lexicon of the English language (while linguists have pronounced "subprime" their word of the year).

If we stop attempting to bypass the creative destruction of capitalism, we will finally be able to bring about a recovery built on a solid foundation instead of the quicksand underlying the 2003-07 "recovery" that was built on the housing mania. Though I would like to think the politicians and the Fed get the message and will let the process play out, I am not going to hold my breath.

Memo to those who would meddle

Indeed, as Stephen Roach wrote in last week's Financial Times (read "America's inflated asset prices must fall"): "The U.S. body politic is . . . underwriting massive liquidity injections that produce another asset bubble and proposing fiscal pump-priming that would depress domestic saving even further. Such actions can only compound the problems that got America into this mess in the first place."

Noting how those actions had suppressed the savings process in this country, Roach commented: "America's aversion toward saving did not appear out of thin air. Waves of asset appreciation -- first equities and, more recently, residential property -- convinced citizens that a new era was at hand. Reinforced by a monstrous bubble of cheap credit, there was little perceived need to save the old-fashioned way -- out of income. Assets became the preferred vehicle of choice. With one bubble begetting another, America's imbalances rose to epic proportions.