Professor Predicts Human Race Will "split into two different species"

One race will be rich, beautiful, intelligent elite, the other will be goblin like underclass

Steve Watson
Infowars.net
Friday, Oct 26, 2007

An evolutionary theorist from the London School of Economics has caused controversy by suggesting that the human race will reach its physical peak by the year 3000 and will then split into two different species, one perfect elite race and one regressed race of small ugly goblin like creatures.

Oliver Curry has forwarded his theory, the Bravo Evolution Report, based on sexual selection and an increasing move to use technology to enhance physical attributes and life expectancy.

Curry suggests that much like in HG Wells' novel The Time Machine, in 100,000 years a genetically perfected ruling elite will dominate the planet and be served by a dumbed down animalistic version of humanity.

The Daily Mail reports:

These humans will be between 6ft and 7ft tall and they will live up to 120 years.

"Physical features will be driven by indicators of health, youth and fertility that men and women have evolved to look for in potential mates," says the report, which suggests that advances in cosmetic surgery and other body modifying techniques will effectively homogenise our appearance.

Men will have symmetrical facial features, deeper voices and bigger penises, according to Curry in in a report commissioned for men's satellite TV channel Bravo.

Women will all have glossy hair, smooth hairless skin, large eyes and pert breasts, according to Curry.

Racial differences will be a thing of the past as interbreeding produces a single coffee-coloured skin tone.

The theory closely mirrors that of many proponents of the eugenics movement who have long promoted the idea of creating a kind of Nazi super-race, where the attractive and physically strong are genetically manufactured under laboratory conditions.

Throughout the 20th and into the 21st century eugenics has become a driving force in the push for a world government, a system of micro-managing race and subjugating the masses to elite control.

From Social Darwinism to Hitler's Third Reich to a future that will be impacted by neo-eugenics and the quest for human development, the movement continues to espouse a disgusting creed of racial and genetic purity.

Last week former head of the Human Genome Project until 1992, James Watson, fled the UK after causing outrage by suggesting that some humans, in particular ones with darker skin, are inherently less intelligent than others.

The geneticist explores this racist ideology further in his new book, writing, "there is no firm reason to anticipate that the intellectual capacities of peoples geographically separated in their evolution should prove to have evolved identically".

"Our wanting to reserve equal powers of reason as some universal heritage of humanity will not be enough to make it so," he says.

Alex Jones' new film Endgame explores the dark history of the eugenics movement and it's continuing influence upon our world today. The documentary exposes the agenda to divide and conquer the human race by the means of state-enforced eugenics, a mindset embraced by a large body of elite minds in government, science and academia today.

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Pentagon Holds ‘Bloggers Roundtables’ To Cater To Right-Wing Noise Machine

Think Progress
Friday October 26, 2007

Today, Glenn Greenwald observes that the military has become “rapidly politicized, fully incorporated into…the model of the Republican right-wing noise machine.” Since January, the Pentagon has sought advice from “political hacks” like Bush/Cheney ‘04 aide Steve Schmidt who recently “went over to Iraq to look at the communications capabilities” of the military.

Another aspect of this politicization is the budding ties between the right-wing blogosphere and the military. Last October, the Pentagon announced that it was “starting an operation akin to a political campaign war room” in order to “set the record straight” on the wars in Iraq and Afghanistan. New teams were to “develop messages” focusing “on newer media, such as blogs.”

In February, the Pentagon began holding Bloggers Roundtables to “provide source material for stories in the blogosphere concerning the DoD and the Global War on Terrorism.” But at these roundtables, the Pentagon has reserved space almost exclusively for conservatives and military bloggers. Some examples of the bloggers on the roundtables just this month:

Wizbang
Weekly Standard
Threats Watch
Qando.net
U.S. Cavalry On Point
Griff Jenkins (Fox News anchor)
Air Force Pundit
Military.com
Defense Technology International
Austin Bay

When the program was started in February, the calls occurred approximately once a week; since September, the Defense Department PR team has surged the roundtables’ frequency to nearly every day. Many of these conservative bloggers regularly appear on the calls, receiving unfettered access to military strategy in Iraq and Afghanistan. One military official explained the real intent:

[W]e’re trying to do as many of these type of blogger calls as possible to let folks know what is really going on out there and to provide the opportunity for people to hear and write about it.

Despite the regular frequency of the “Blogger Roundtables,” progressive bloggers or anti-war military bloggers are rarely featured. Furthermore, small blogs like that of Fox News anchor Griff Jenkins are featured on the calls while more prominent progressive blogs are not.

Bipartisan Consensus: Iraq, Many More Years of War

Jack A. Smith
Global Research
October 24, 2007

After a few skirmishes, congressional Democrats have fled the field of battle with the Republicans over the matter of withdrawing some U.S. troops from Iraq. Ending the war itself was never a serious part of the several-month debate, although many Americans thought it was.

A consensus seems to be building in Washington that views a long term U.S. military presence in Iraq as a valuable geostrategic asset in the quest for regional and global hegemony. Secretary of Defense Robert Gates is now talking about an occupation of an unlimited number of years with a minimum of 40,000 U.S. troops. The Democratic Party and the majority of its politicians in Congress are expected to go along with this.

The Democratic leadership has declared it now seeks compromise with the Bush Administration and Republicans in Congress, and isn¹t willing to force the issue of troop withdrawal. Hillary Clinton, Barak Obama and John Edwards ‹ leading candidates for the Democratic presidential nomination ‹ have all been quoted as suggesting that the war will not end for at least five-and-a-half more years (the end of the new presidential term). According to a Sept. 29 article in the Washington Post, the important question for these candidates “is no longer whether U.S. forces will remain in Iraq but what size, mission and length a post-buildup [post-surge], post-Bush force would take on.”

It also appears that the centrist majority of the Democratic delegation in the House and Senate is committed to keeping a large contingent of American troops in Iraq at least as long as Clinton, Obama and Edwards predict. Public opinion polls in September showed that only 5% of the American people want the troops to remain that long, but they will be ignored unless a great deal more pressure is exerted by the American people and the U.S. peace movement.

Democratic leaders will make efforts to convince the voters throughout the year leading to the 2008 elections that they are doing their best to bring U.S. troops home. But it will be for show, in order to propel a Democrat into the White House on the basis of antiwar opinion.

Democratic House and Senate leaders, Rep. Nancy Pelosi and Sen. Harry Reid, claim that the threat of a Republican filibuster and a veto from President George W. Bush constitute a double whammy preventing the Democratic majority in both houses of Congress from passing legislation to withdraw the U.S. Army of Occupation from Iraq.

At best, this argument is disingenuous. All the Democrats in Congress need do is exercise their constitutional right to withhold funds to continue the war, allocating monies only for the swift withdrawal of all American troops. A majority can do it. In the Senate, if the Democrats can¹t accumulate 51 votes, all they¹d need is 41 to mount a filibuster which would prevent the funding bill from being called for a vote. The refusal to attempt such action is an indication that the Democrats have other plans in mind. The Democratic congressional leadership insists de-funding would be unpopular with the voters and may cost them the election. But that is misleading.

Once the March 2003 invasion began, the Democratic Party has been as committed as the Republicans to winning the Iraq war, despite the antiwar views of a small minority of legislators within its ranks. Democratic leaders think they can conduct the war better than the blundering Bush Administration. Winning in Iraq was their position in the 2004 election with John Kerry and it is their position now. The difference is that Democratic leaders said it openly then and conceal it now because public opinion has changed.

The “peace party,” as the Dems have positioned themselves in the election, talks about withdrawal but the fact is that its most extreme proposal has been for a gradual and partial withdrawal that would keep up to 50,000 American troops in Iraq for many years. With them would be a huge number of mercenaries and tens of thousands of civilians now providing services that the military used to handle just a decade ago.

The U.S. will wind up spending some $2 trillion dollars on the Iraq project if it ends in a couple of years, and much more if it lasts a decade or so, as seems likely. Washington will not simply walk away from an investment of this size. There is too much at stake, including control over one of the largest reserves of petroleum under the Earth, and America¹s domination of the entire Middle East.

Here, in our view, is the Democratic leadership¹s simultaneous two-stage prescription for “victory” in Iraq:

1. After a Democrat becomes the next president, they will begin the process of partial withdrawal over several years. This will reduce popular opposition, even as hostilities continue. After a year or two, as Iraqi troops play more of a front-line role, the number of US. casualities will drop considerably, further eroding the demand for an end to the war.

2. During this time, the U.S. will fund, train, field and control the huge Iraqi army so that it does most of the fighting. The Pentagon will back it up with tens of thousands of U.S. Special Forces and other troops stationed in impregnable bases and supported by a vast expansion of American air power. Buy off as much of the opposition as possible. Promise to invest in rebuilding part of the infrastructure. Create an informal but effective separation of Iraq into three parts ‹ Kurd, Shia, Sunni ‹ to reduce communal strife. Maintain control over whatever Iraq government it is convenient to put in power and direct affairs, as now, from Washington. Bring in the UN as cover.

There are other aspects to Washington¹s triumph in an unjust war, but these are key. If it works, the U.S. military will remain in Iraq for many years. How many? How about 10 to 50 years?

The U.S. has stationed almost 40,000 troops, missiles, bombers and nuclear weapons in South Korea for over a half century, and they are not about to leave despite the so-called “shortage” of American troops in Iraq. “Protecting” South Korea is not the reason. The existence of substantial U.S. military power an hour or two away from China, Russia and Japan is a major forward thrust in the geostrategic drive for world hegemony.

Maintaining a powerful military force in the client state of Iraq for decades will be an even more important geostrategic maneuver, if it works out. One reason, as former Federal Reserve boss Alan Greenspan let slip in his new book, is that ‘the Iraq war is largely about oil.² Of course it is, but there¹s more.

The U.S. seeks to become so powerfully entrenched in Iraq that it is given first grabs at the oil for a reasonable price, plus influence over who else gets the oil. This is why the Congress and the White House are demanding that Baghdad agree to the ‘benchmark’ about de-nationalizing the oil fields and allowing U.S. companies to earn super profits for extracting and delivering this strategic commodity. When the corporations get in and the oil starts flowing, naturally they will have to be protected by reliable American forces.

The geostrategic reason for Washington to remain a politically and militarily dominant force in Iraq is to facilitate the extension of U.S. hegemony throughout the Middle East, with Russia and China very much in mind.

The U.S. is engaged in am undeclared new cold war with both China and the revived, Putin-era Russia. The principal area of contention between Beijing and Moscow on the one hand, and Washington on the other, is that both China and Russia are aligned in opposing the concept of a unipolar world order wherein the United States operates as the dominating superpower and world cop, as it has done since the Soviet downfall.

The alternative is a multipolar system where several countries or regions operate as essentially equal powers, with the UN playing a larger role. Washington rejects, and suggests it will fight against, any erosion in its dominant unipolar position. This contradiction will be resolved in the next decades, one way or the other. In an important speech Oct. 15, Chinese President Hu Jintao declared that the ‘trend toward a multipolar world is irreversible.²

The U.S. will be empowered significantly in this geostrategic struggle if it can sufficiently control the oil-rich states of the Middle East to the point of influencing which outside states can and cannot purchase or drill for the region¹s oil. With influence such as this, first in Iraq and then the region, the U.S. will guarantee itself abundant supplies of this vital but diminishing energy resource for many decades to come. In the process this will reduce its own dependence on certain politically problematic sources such as Venezuela.

Washington believes that its European allies are becoming too dependant on oil and natural gas from Russia. Should America¹s plans for the Middle East succeed, enough oil could be made available to the European Union/NATO countries at attractive prices to draw them away from Moscow. Naturally such a circumstance would make the Europeans more dependent on America in exchange.

China comes into the picture because of a desperate need for energy resources to continue its role as the world¹s manufacturing resource, as well as a requirement to satisfy the domestic needs of a population four times larger than the United States. With decisive influence over the disposition of the world¹s largest oil fields, Washington could threaten to prevent China¹s access to Middle East oil should push come to shove over Beijing¹s economic power and the unipolar issue. China seeks Russian oil, but would be reluctant to become principally dependent on Moscow¹s energy supplies. Each is a proud and important nation seeking an independent place in the sun, and wary of falling under the other¹s shadow.

A large, permanent garrison in Iraq will transport Washington closer to its geopolitical goals. A presence of this magnitude will allow the U.S. to militarily threaten Iran, Syria, and Lebanon whenever “necessary” It will further bolster Israel, and enhance U.S. control of the region while extending its reach closer to southern Russia.

These are the main reasons we believe Washington¹s intention is a long occupation in Iraq and why there will be little real opposition from the Democratic or Republican parties. The war has been bipartisan from the day it began and, aside from salvos of unpleasant rhetoric, probably will remain so under a somewhat different configuration with a Democratic president in the White House.

Washington may never attain its long range objectives, of course. The Pentagon¹s Army of Occupation and it¹s creation, the ‘Iraqi² army, may never be able to ’stabilize² Iraq, and the situation will continue to worsen. The American people, already sick of the war, may see through the phased, partial withdrawal scheme, and recognize it for what it is: a mechanism for continuing the war for years to come.

The U.S. antiwar movement, in combination with pubic opinion, may be able to frustrate the plans for a long occupation. But its many components will have to be far more politically savvy, united in action, independent of the two ruling parties, and willing to escalate its confrontation with whoever the powers may be. At this stage it appears that a large sector of the peace forces, While still calling for withdrawal, will mainly spend next year seeking to elect Democrats in the 2008 elections.

A New Era of Unrestrained Mercantilism

The International Forecaster
October 15 2007

If there are no borders or tariffs, transnational conglomerates, banks and central banks, etc. would be able to operate at will and impoverish just about everyone. It is the old British mercantilism on the loose again. The major banks of the world think they control the world presently and to a great extent that is about to come to an end. The financial system worldwide is now out of control and there is no way to regain control. All the elitists can do is stop a crash landing. This is in part why we have mercenary armies on our soil and under contract to government. They will be used to control the public under Martial law. These elitist conglomerates even have their own intelligence sections and they employ those mercenary outfits to provide security.

The latest blast from the White House was to prepare for terror. This is the call for states and cities to make contracts with private security companies to hire mercenaries to guard companies and even communities against the phantom ravages of terrorism. Better yet, it is a step along the road to Martial law. We are hearing stories of entire communities being put behind walls and barbed wire with mercenaries guarding the complexes 24/7 to assure safety. We read 36 publications a day in 5 languages, most American publications, and we cannot believe the crime we see. Their precautions are not just against crime, they are being pushed against communities by Washington and the likes of Blackwater to fend off terrorists. Private armies are in vogue and that is not good, because there forces could as well quickly become the enemy at the command of government. The then against us mentality is beginning to show its face in wealthy communities and among elitists. What the elitists are attempting won’t work if for no other reason than there are too many have-nots, and as they found out in the French Revolution you cannot kill them all, there are just too many of them. These multinational, transnational types may have their private armies but in the final analysis it won’t give them protection they seek. People are going to be very mad when they finally realize what has been done to them, and they won’t be taking any prisoners. You might say Mad Max lives.

The Wall Street Journal says that despite the seeming easing of the credit crisis in the wake of last month’s aggressive easing by the Fed, banks are still sitting on hundreds of billions of buyout loans. The paper adds that unless the pace of sales picks up, the banks will be stuck with $400 to $800 billion in toxic loans for sometime to come, and a scenario that will prove problematic if the economy slows, which it will, and corporate profits head south, which they will.

Only the highest quality tranches are finding takers, the paper is being sold at discounted levels. Only $30 billion of $310 billion of North American LBO loans has been sold so far, with $100 billion in debt expected to hit the market in just the next month. On Tuesday, the big Tocom shorts cut their net shorts by 3,370 contracts to 42,195, as Goldman increased their shorts by 27 contracts to 12,531. Silver shorts were cut by 182 contracts to 2,008.

Only a little more than a year is left before George and the neocons leave office and they have issued a new Homeland Security strategy calling on citizens and governments to develop a “culture of preparedness” to deal with natural disasters and terrorism. The 53-word document emphasizes an all-hazards approach to disasters.

First is the focus on al Qaeda’s desire to obtain weapons of mass destruction. Then there is the spread of improvised explosive devices from battlefields in Iraq and Afghanistan to America. The policy is ludicrous. It is more fear mongering to create an enemy that doesn’t exist to keep the American populace in fear. This is also an effort to assure that Congress gives the president authority to eavesdrop on suspected terrorists in order to build a more perfect police state. We are being prepared for something that doesn’t exist, or exists only in the diseased minds of the administration.

America’s mortgage crisis is going to get considerably worse because of the level of fraudulent lending by mortgage originators and banks is much higher than previously estimated and we predicted. Defaults on subprime mortgages will continue to soar for another 18 months as unqualified mortgage holders struggle to meet their repayments, and tightening credit markets make ARM resets impossible. Our projection for economic growth in 2007 is 2% and zero to 1% in 2008. Thus, as unemployment rises more panic will ensue. Our big question is if governments tell us there has been so much fraud, why haven’t they brought criminal charges against lenders? The answer is if they do the world will find out that the Fed and our government encouraged the fraudulent lending – that is why. Then we will have to indict the people who approved and sanctioned such actions, such as Sir Alan Greenspan and our President.

In August foreclosures jumped 115% to 243,947 yoy, or one in 510 households of which about 40% end in forced sale or repossession. As this takes place house prices fall exacerbating the situation.

In the Dallas-Ft. Worth area, new housing projects fell 30% during the third quarter yoy and sales of new homes fell 20% with homes under $200,000 seeing the biggest decline. Cargo containers coming into US ports were supposed to set a record this year, but in reality imports are shrinking, off 1.4%.

The average vacancy rate in strip malls stands at 7.3% as of 6/30/07, and is expected to rise to 7.6% by yearend, the highest level since 1935.

The US Treasury 2007 budget deficit reported in at $162.8 billion as of 9/30 and the prior deficit was revised to $248.2 billion from $247.7 billion.

Home foreclosures doubled in September you at 223,538, including default and auction notices and bank repossessions, an 8% decline in August. California led the way with 51,259 and Florida was second with 33,354. That is one for every 557 households.

The Business Council and Conference Board found that 44.3% of 61 top CEO’s forecast economic conditions in their own industry would get worse over the next six months, while 16.4% see improvement. Thirty-nine percent see conditions unchanged; 24.4% saw worsening conditions, while 60% saw conditions staying the same.

Countrywide funded 44% fewer mortgage loans in September, while delinquencies increased and foreclosures doubled. They cut 4,935 jobs last month, leaving them with 55,932. They will cut 12,000 jobs, or 20% by December.

What the public is finally starting to realize is that inflation is a deliberate policy that will go on endlessly. People now looking for a crunch-up boom and soon everyone will want to swap dollars for real goods, no matter whether they need them or not. The idea is to get rid of the fiat currency. This happened to the continental currency of 1781 and to the French mandates territoriaux in 1796, and with the German marks in 1923.

September import price index increases were 1% mom and 5.2% yoy. This is inflationary as our government and the Fed members tell us they see no import price inflation.

FBI Warns Again Of Shoe Bomb Danger

CBS News
October 26, 2007

The joint FBI-Homeland Security bulletin, obtained by CBS News today, bluntly warns that terrorists are still working to use “modified footwear as a concealment method for explosive devices,” CBS News correspondent Bob Orr reports.

The alert follows the discovery of bomb detonators - expertly hidden in the hollowed-out soles of this pair of shoes - found aboard a European bus last month.

Intelligence officials say the shoes were not being worn at the time, but instead were being used, as the document says, “to smuggle electric blasting caps across international borders for use in a terrorist attack.”

“The terrorists have an interest in explosive devices. They are trying to figure out the best way to push them, to move them through the system,” said CBS News counterterrorism analyst Paul Kurtz.

Shoes have been used by terrorists before.

Three months after 9/11, al Qaeda operative Richard Reid tried to blow up an American Airlines jet with a shoe bomb similar to the one shown in this test.

Now at U.S. airports, scanners X-ray all passengers’ shoes and carry on bags, searching for explosives.

Still, experts worry that a team of terrorists could beat security by carrying unassembled parts of a bomb past a checkpoint.

“Where one person will carry component A, the next person will carry component B, and they will meet together past the safety point, past the checkpoint and reassemble,” explained Mike White, the director of training for Michael Stapleton Associates and a former head of the NYPD bomb squad.

Officials say there is no specific intelligence that terrorists are preparing new attacks against America.

But, the threat remains high - and the bulletin warns law enforcement officials not to assume that routine objects, like shoes, are always what they appear to be.

Pandemic test undertaken by financial services paints dire scenario

Patrick Thibodeau
Computerworld
October 24, 2007

If a pandemic strikes the U.S., it will kill about 1.7 million people, hospitalize 9 million, exhaust antiviral medications and reduce basic food supplies, according to a planning scenario developed by financial service firms preparing for such a catastrophe.

This particular disaster occurred only on paper. But those grim numbers are some of the pandemic planning assumptions used by nearly 3,000 banks, insurance companies and security firms in a just-concluded, three-week, paper-based exercise that may have been the largest pandemic test of its kind.

In each week of this drill, participants — some 10,000 people were involved — received an updated scenario and were asked to assess their capability to deliver services as the pandemic deepened and then abated.

“We wanted to look at the impact a pandemic can have on our sector,” said George Hender, chairman of the Financial Services Coordinating Council, in a teleconference Wednesday. “One of the things that we tried to do is put some real stress on the firms.”

During the height of the pandemic, which was estimated to occur midway through the scenario, participants were asked to consider operating with an absentee rate of nearly 50% — above the 35% to 40% rate federal officials believe may actually happen, said Hender. “We deliberately took the rate up much higher to see where their stress points were,” he said.

The financial services groups are now sharing the pandemic flu exercise information, and all the scenarios are available for download.

The U.S. Department of Treasury is also a sponsor of the test, and Valerie Abend, deputy assistant secretary for critical infrastructure protection and compliance at the department, said the financial services industry has been “thinking long and hard about a pandemic.”

“We are one of the most prepared, I would argue, if not the most prepared of the critical infrastructures that are out there,” said Abend.

But the financial services firms won’t really know how prepared they are until the end of the year. The thousands of pages of data collected during the test, which began in the last week of September, are still being analyzed and a final report is due at year’s end. But based on some preliminary feedback from participants, the financial service firms weren’t handing out too many gold stars for readiness.

When asked “based on the lessons learned from the exercise, how effective are your organization’s business continuity plans for a pandemic,” 56% answered “moderately,” the next highest group was “minimally,” at 28%. Only 12% said their business continuity planning was very effective.

The three-week scenario compresses the 12-week period a pandemic wave would likely last. Among the other things that may happen in an actual pandemic are school closings, as well as blackouts or brownouts in major metro areas because of degraded service as a result of absenteeism. Internet service throughput could be reduced by 50% due to congestion, and Web browsing timeouts would become common. Airlines would cut schedules, and garbage would pile up on streets.

Many frustrations would arise. Working ATMs might be scarce, and call centers may not have enough staff to help. Health insurance claim volume would rise 20%. Auto claims are expected to fall 10%, since there would be less traffic on the road. But for those who are driving, gas prices would be high and fuel supplies reduced.

Putin: Bush “Like a Madman with a Razor Blade” On Iran

MIKE ECKEL
Associated Press
Oct 25, 2007

Putin warns against more Iran sanctions

LISBON, Portugal - Russian President Vladimir Putin warned strongly Thursday against imposing new international sanctions on Iran, in words that appeared to be a response to newly announced U.S. measures to punish Tehran.

Putin spoke hours after Washington cut off Iranian military and banking institutions from the American financial system. The U.S. said the sanctions were in response to Iran’s defiance of U.N. demands to curb its nuclear program and its alleged support for terrorism.

Arriving for a summit with European Union leaders, the Russian leader did not make any direct reference to the U.S. announcement., but he said the standoff with Iran will have to be resolved through patient talks.

“Why worsen the situation and bring it to a dead end by threatening sanctions or military action?” Putin asked. “Running around like a madman with a razor blade, waving it around, is not the best way to resolve the situation.”

Russia, which is building Iran’s first nuclear power plant, has opposed a new push for a third round of U.N. sanctions over the Iranian defiance of a Security Council demand that it suspend enriching uranium.

The U.S. and its allies suspect Iran is secretly trying to develop nuclear weapons, a charge that the Tehran regime denies. Iran says it is only working to produce fuel for nuclear reactors to generate electricity and insists it will not give up uranium enrichment.

Speaking at a news conference after talks with Portuguese President Anibal Cavaco Silva, Putin pointed to the long negotiations with North Korea that led to an agreement earlier this year for that communist nation to begin dismantling its nuclear facilities.

“Not long ago it didn’t seem possible to resolve the situation with North Korea’s nuclear program, but we have practically solved it relying on peaceful means,” he said.

Putin has rebuffed Western calls for more sanctions against Iran by saying he has seen no evidence the Iranians are working on atomic weapons. But he said Thursday that when he visited Tehran last week, he reaffirmed Russia’s strong opposition to the spread of such weapons.

On another matter, Putin warned against independence for Kosovo, a predominantly ethnic Albanian province of Serbia that is another difficult issue between Russia and the West.

A Western-backed plan would grant the province internationally supervised independence, but Putin said giving in to independence demands from Kosovo’s Albanians would encourage separatist trends in many European nations and former Soviet states.

“Why keep rocking the foundations of the international law, encourage and develop separatism in Europe and the ex-Soviet space?” he said.

Putin’s annual meeting with EU leaders Friday seemed likely to be one of the most contentious in recent years, with a long-standing series of disagreements standing in the way of any partnership agreement between Russia and the 27-nation bloc.

Their recent summits have seen a steady decline in relations because of disputes over trade, energy, human rights, conflicts in the Balkans and other issues.

Just two minor deals were expected to be announced after Friday’s meeting — one to increase cooperation in fighting drug use and trafficking, the other to boost Russian steel exports to western Europe.

Negotiators were not expected to resolve disagreements over energy, aviation, trade and human rights. The issue of visas for Russians traveling to the EU also is thorny.

Putin lamented that Moscow had good relations with some countries — Romania, for example — but prickly ties with others.

“The fewer barriers there are, including visa, the better,” he said.

Oil Rises to Record Above $91 on Supply Drop, Iran Sanctions

Angela Macdonald-Smith and Christian Schmollinger
Bloomberg
October 26, 2007

Crude oil rose to a record above $91 a barrel in New York on an unexpected drop in U.S. stockpiles and concern that supply from the Middle East may be disrupted.

Inventories last week fell 5.29 million barrels to the lowest since January, the U.S. Energy Department said. New U.S. sanctions against Iran, warnings of a Turkish assault on Kurdish militants in Iraq and a falling dollar helped push prices higher. Brent futures in London reached a record.

“The market has been particularly surprised by that 5 million-barrel drop in crude, that was really one out of left- field,” said Mark Pervan, a commodity strategist at Australia & New Zealand Banking Group Ltd. in Melbourne. “As much as we’re seeing concern about Middle East stability, it’s a dollar-driven story as well. It’s a bit of a perfect storm.”

Crude oil for December delivery rose as much as 64 cents, or 0.7 percent, to $91.10 a barrel in after-hours electronic trading on the New York Mercantile Exchange, the highest since trading began in 1983. It traded at $91.02 at 12:20 p.m. Singapore time. Prices are 51 percent higher than a year ago.

Yesterday the contract jumped $3.36, or 3.9 percent, to $90.46 a barrel, a record close. It was the biggest one-day gain since April 23.

Record oil prices are raising concerns that inflation will rise and lower growth in the global economy. The Group of Seven industrial nations said in a statement last week that high crude levels will moderate growth going forward.

Singapore Airlines

Singapore Airlines Ltd., Southeast Asia’s largest carrier, is concerned about the rising price of jet fuel, Chief Executive Officer Chew Choon Seng said in Sydney today. The airline raised fuel surcharges on Oct. 18 by as much as $6 a ticket because of higher oil prices.

Brent crude oil for December settlement rose as much as $1.32, or 1.5 percent, to a record $88.80 a barrel on the London-based ICE Futures Europe exchange. It was at $88.11 a barrel at 12:18 p.m. Singapore time. The contract, the benchmark for two-thirds of global supplies, closed yesterday up $3.11, or 3.7 percent, at $87.48 a barrel.

The Bush administration yesterday announced new sanctions against Iran that designate the Iranian Revolutionary Guard Corps as a proliferator of weapons of mass destruction and its Quds force as a supporter of terrorism.

Secretary of State Condoleezza Rice, who joined Treasury Secretary Henry Paulson in announcing the sanctions, said the steps were designed “to increase the costs to Iran of its irresponsible behavior.”

The U.S. is trying to get Iran to halt uranium enrichment that it suspects is aimed at developing nuclear weapons. Iran, which holds the world’s second-largest oil and natural gas reserves, says it wants to enrich uranium to produce electricity. The dispute has bolstered oil prices since January 2006 because of concern that oil shipments from the country might be cut.

Turkey Warning

Turkey warned of a wider military assault into northern Iraq and called on the U.S. to join the fight as the army shelled suspected militant camps over the Iraqi border.

Turkey won’t stand by after Iraq allowed members of the Kurdistan Workers’ Party, or PKK, to use bases on Iraqi territory for attacks that left 42 Turks dead this month, President Abdullah Gul said yesterday in Ankara. Shelling by Turkish artillery of the Iraqi side of the border continued yesterday, CNN Turk reported.

“The U.S. sanctions against Iran seem to be pushing things to some sort of confrontation,” said Gavin Wendt, senior resources analyst at Fat Prophets in Sydney. “When you’re talking Iran and Iraq, two of the biggest holders of oil reserves, no wonder markets are nervous.”

Dollar Effect

The dollar approached a record low against the euro after reports showed U.S. orders for durable goods fell unexpectedly and initial jobless claims were higher than forecast, signaling economic growth may weaken. Slower growth supports the argument for the Federal Reserve to cut interest rates next week.

China yesterday said its economy, the biggest contributor to global growth, expanded 11.5 percent in the third quarter from a year earlier.

“The currency is really holding up commodities market generally,” ANZ Bank’s Pervan said. “Dovetailing that with strong Chinese growth yesterday, it’s enough to give oil that extra momentum.”

OPEC ‘Surprising’

The Organization of Petroleum Exporting Countries, supplier of about 40 percent of the world’s oil, doesn’t plan additional output even with record oil prices, Venezuelan Energy Minister Rafael Ramirez told reporters in Caracas yesterday.

“There is enough oil in the market,” Ramirez said. OPEC is “not planning to increase production.”

OPEC’s refusal to consider an increase is surprising, said Gerard Burg, a minerals and energy economist at National Australia Bank Ltd. in Melbourne.

“I wouldn’t have thought that the majority of producers would be happy with prices above $90,” Burg said. “I would have thought that the force of Saudi Arabia and its more dovish supporters might have brought a bit more oil on.”

“There seems to be a consensus view that there’s enough oil in the market, it’s really just concerns that are driving it,” Burg said.

Endgame: How Dare Alex Jones Tell the Truth

Kurt Nimmo TruthNews October 25, 2007

Alex Jones’ Endgame is a horror film. It’s creepier than Nosferatu, the German Expressionist film featuring the vampire Count Orlok. Endgame, Blueprint for Global Enslavement, has its own cast of imperial functionaries, although they are not vampires, not exactly. Vampires are preternatural beings, fictional reanimated corpses, the stuff of Bram Stoker novels and low budget movies, whereas the cast of characters revealed in Endgame are flesh and blood, craven yet mundane, although it can be said they shirk the light of day or rather what sunshine announces same as their fictive counterparts.

No, the monsters of Endgame are real, they do not evaporate when the cinema lights go up or the last page is flipped. Endgame’s miscreations are older than the sort of European folklore responsible for the myth of Dracula, more ruthless an supposedly unstoppable than John Carpenter’s Michael Myers.

Eugenics is the horror behind Endgame. Not warm and fuzzy altruism in search of higher IQs and a beneficial reduction of disease, but rather mass extermination, social Darwinism, and the dysgenic dreams of the ruling elite who are determined, as the Georgia Guidestones concede, to reduce the world population to a mere 500,000,000 “in perpetual balance with nature.”

Endgame spells out in chilling detail how the blue-blood, aristocratic, wealthy elite played a central role in the development of eugenics, resulting not only in the Eugenics Record Office in America, located in Cold Spring Harbor in New York, and responsible for mass sterilization, but also responsible for the Kaiser Wilhelm Institutes that ultimately led to the Nazi eugenics program terminating at the end of the rail line in Auschwitz. For as Rockefeller factotum Merton Lambert once averred, “The world has a cancer, and that cancer is man.”

Merton was not talking about his boss, but rather you and me, the commoners, the disease to be cured by the “particularly deadly virus” envisioned by the misanthrope Prince Philip. Hitler’s ultimate failure did not put a damper to eugenics. It is alive and well today in the environmental movement, well oiled by Rockefeller foundations and stealth NGOs.

Like Erin Alfaro, writing for National Expositor, I was kept awake at night after watching Endgame. “Rarely does a documentary stir the mind so much that it keeps you awake at night, plotting your escape from a seemingly unchangeable future,” writes Alfaro.

Of course, the future is not unchangeable, although it may seem that way. Endgame, as a well-produced yet bone-chilling documentary, is just the tool required to foment change, beginning with the startled awareness of what our appointed leaders, more scary than anything George Romero or Stephen King might conjure, have in mind for us.

Just the other day, Bill Clinton—the Rhodes scholar student of New World Order historian Carroll Quigley, groomed for the presidency by the Bilderbergers—admonished a brave handful of 9/11 truthseekers for the crime of speaking up. “How dare you. How dare you,” Clinton imperiously growled as the truthseekers declared 9/11 to be an inside job. “I’ll be glad to talk to you if you shut up and let me talk.”

Naturally, Clinton and his one-world pedigree of hand-picked insiders, determined to cull the masses, are not inclined to let us, the commoners, talk, although they do insist we shut up and let them talk—incessantly and sans meaningful opposition, as aristocrats are perennially accustomed.

How dare Alex Jones tell the truth. How dare he make Endgame, certainly a horror film, and reveal the ghastly master plan designed to not only enslave the planet but reduce its numbers in psychopathic fashion.

Endgame is surely impertinence of the sort the elite not only detest, but decidedly fear same as the cockroach fears and scurries when a light is switched on.

ALEX JONES’ ENDGAME will be released on the WEB OCT. 26 and on DVD on NOV. 1. View High Quality Trailers at www.endgamethemovie.com

House Passes Thought Crime Prevention Bill

Lee Rogers
Rogue Government
October 25, 2007

The U.S. House of Representatives recently passed HR 1955 titled the Violent Radicalization and Homegrown Terrorism Prevention Act of 2007. This bill is one of the most blatant attacks against the Constitution yet and actually defines thought crimes as homegrown terrorism. If passed into law, it will also establish a commission and a Center of Excellence to study and defeat so called thought criminals. Unlike previous anti-terror legislation, this bill specifically targets the civilian population of the United States and uses vague language to define homegrown terrorism. Amazingly, 404 of our elected representatives from both the Democrat and Republican parties voted in favor of this bill. There is little doubt that this bill is specifically targeting the growing patriot community that is demanding the restoration of the Constitution. First let’s take a look at the definitions of violent radicalization and homegrown terrorism as defined in Section 899A of the bill.

The definition of violent radicalization uses vague language to define this term of promoting any belief system that the government considers to be an extremist agenda. Since the bill doesn’t specifically define what an extremist belief system is, it is entirely up to the interpretation of the government. Considering how much the government has done to destroy the Constitution they could even define Ron Paul supporters as promoting an extremist belief system. Literally, the government according to this definition can define whatever they want as an extremist belief system. Essentially they have defined violent radicalization as thought crime. The definition as defined in the bill is shown below.

(2) VIOLENT RADICALIZATION- The term violent radicalization’ means the process of adopting or promoting an extremist belief system for the purpose of facilitating ideologically based violence to advance political, religious, or social change.

The definition of homegrown terrorism uses equally vague language to further define thought crime. The bill includes the planned use of force or violence as homegrown terrorism which could be interpreted as thinking about using force or violence. Not only that but the definition is so vaguely defined, that petty crimes could even fall into the category of homegrown terrorism. The definition as defined in the bill is shown below.

(3) HOMEGROWN TERRORISM- The term homegrown terrorism’ means the use, planned use, or threatened use, of force or violence by a group or individual born, raised, or based and operating primarily within the United States or any possession of the United States to intimidate or coerce the United States government, the civilian population of the United States, or any segment thereof, in furtherance of political or social objectives.

Section 899B of the bill goes over the findings of Congress as it pertains to homegrown terrorism. Particularly alarming is that the bill mentions the Internet as a main source for terrorist propaganda. The bill even mentions streams in obvious reference to many of the patriot and pro-constitution Internet radio networks that have been formed. It also mentions that homegrown terrorists span all ages and races indicating that the Congress is stating that everyone is a potential terrorist. Even worse is that Congress states in their findings that they should look at draconian police states like Canada, Australia and the United Kingdom as models to defeat homegrown terrorists. Literally, these findings of Congress fall right in line with the growing patriot community.

The biggest joke of all is that this section also says that any measure to prevent violent radicalization and homegrown terrorism should not violate the constitutional rights of citizens. However, the definition of violent radicalization and homegrown terrorism as they are defined in section 899A are themselves unconstitutional. The Constitution does not allow the government to arrest people for thought crimes, so any promises not to violate the constitutional rights of citizens are already broken by their own definitions.

SEC. 899B. FINDINGS.

The Congress finds the following:

(1) The development and implementation of methods and processes that can be utilized to prevent violent radicalization, homegrown terrorism, and ideologically based violence in the United States is critical to combating domestic terrorism.

(2) The promotion of violent radicalization, homegrown terrorism, and ideologically based violence exists in the United States and poses a threat to homeland security.

(3) The Internet has aided in facilitating violent radicalization, ideologically based violence, and the homegrown terrorism process in the United States by providing access to broad and constant streams of terrorist-related propaganda to United States citizens.

(4) While the United States must continue its vigilant efforts to combat international terrorism, it must also strengthen efforts to combat the threat posed by homegrown terrorists based and operating within the United States.

(5) Understanding the motivational factors that lead to violent radicalization, homegrown terrorism, and ideologically based violence is a vital step toward eradicating these threats in the United States.

(6) The potential rise of self radicalized, unaffiliated terrorists domestically cannot be easily prevented through traditional Federal intelligence or law enforcement efforts, and requires the incorporation of State and local solutions.

(7) Individuals prone to violent radicalization, homegrown terrorism, and ideologically based violence span all races, ethnicities, and religious beliefs, and individuals should not be targeted based solely on race, ethnicity, or religion.

(8) Any measure taken to prevent violent radicalization, homegrown terrorism, and ideologically based violence and homegrown terrorism in the United States should not violate the constitutional rights, civil rights and civil liberties of United States citizens and lawful permanent residents.

(9) Certain governments, including the United Kingdom, Canada, and Australia have significant experience with homegrown terrorism and the United States can benefit from lessons learned by those nations.

Section 899C calls for a commission on the prevention of violent radicalization and ideologically based violence. The commission will consist of ten members appointed by various individuals that hold different positions in government. Essentially, this is a commission that will examine and report on how they are going to deal with violent radicalization and homegrown terrorism. So basically, the commission is being formed specifically on how to deal with thought criminals in the United States. The bill requires that the commission submit their final report 18 months following the commission’s first meeting as well as submit interim reports every 6 months leading up to the final report. Below is the bill’s defined purpose of the commission. Amazingly they even define one of the purposes of the commission to determine the causes of lone wolf violent radicalization.

(b) Purpose- The purposes of the Commission are the following:

(1) Examine and report upon the facts and causes of violent radicalization, homegrown terrorism, and ideologically based violence in the United States, including United States connections to non-United States persons and networks, violent radicalization, homegrown terrorism, and ideologically based violence in prison, individual or lone wolf’ violent radicalization, homegrown terrorism, and ideologically based violence, and other faces of the phenomena of violent radicalization, homegrown terrorism, and ideologically based violence that the Commission considers important.

(2) Build upon and bring together the work of other entities and avoid unnecessary duplication, by reviewing the findings, conclusions, and recommendations of–

(A) the Center of Excellence established or designated under section 899D, and other academic work, as appropriate;

(B) Federal, State, local, or tribal studies of, reviews of, and experiences with violent radicalization, homegrown terrorism, and ideologically based violence; and

(C) foreign government studies of, reviews of, and experiences with violent radicalization, homegrown terrorism, and ideologically based violence.

Section 899D of the bill establishes a Center of Excellence for the Study of Violent Radicalization and Homegrown Terrorism in the United States. Essentially, this will be a Department of Homeland Security affiliated institution that will study and determine how to defeat thought criminals.

Section 899E of the bill discusses how the government is going to defeat violent radicalization and homegrown terrorism through international cooperation. As stated in the findings section earlier in the legislation, they will unquestionably seek the advice of countries with draconian police states like the United Kingdom to determine how to deal with this growing threat of thought crime.

Possibly the most ridiculous section of the bill is Section 899F which states how they plan on protecting civil rights and civil liberties while preventing ideologically based violence and homegrown terrorism. Here is what the section says.

SEC. 899F. PROTECTING CIVIL RIGHTS AND CIVIL LIBERTIES WHILE PREVENTING IDEOLOGICALLY-BASED VIOLENCE AND HOMEGROWN TERRORISM.

(a) In General- The Department of Homeland Security’s efforts to prevent ideologically-based violence and homegrown terrorism as described herein shall not violate the constitutional rights, civil rights, and civil liberties of United States citizens and lawful permanent residents.

(b) Commitment to Racial Neutrality- The Secretary shall ensure that the activities and operations of the entities created by this subtitle are in compliance with the Department of Homeland Security’s commitment to racial neutrality.

(c) Auditing Mechanism- The Civil Rights and Civil Liberties Officer of the Department of Homeland Security will develop and implement an auditing mechanism to ensure that compliance with this subtitle does not result in a disproportionate impact, without a rational basis, on any particular race, ethnicity, or religion and include the results of its audit in its annual report to Congress required under section 705.’.

(b) Clerical Amendment- The table of contents in section 1(b) of such Act is amended by inserting at the end of the items relating to title VIII the following:

It states in the first subsection that in general the efforts to defeat thought crime shall not violate the constitutional rights, civil rights and civil liberties of the United States citizens and lawful permanent residents. How does this protect constitutional rights if they use vague language such as in general that prefaces the statement? This means that the Department of Homeland Security does not have to abide by the Constitution in their attempts to prevent so called homegrown terrorism.

This bill is completely insane. It literally allows the government to define any and all crimes including thought crime as violent radicalization and homegrown terrorism. Obviously, this legislation is unconstitutional on a number of levels and it is clear that all 404 representatives who voted in favor of this bill are traitors and should be removed from office immediately. The treason spans both political parties and it shows us all that there is no difference between them. The bill will go on to the Senate and will likely be passed and signed into the law by George W. Bush. Considering that draconian legislation like the Patriot Act and the Military Commissions Act have already been passed, there seems little question that this one will get passed as well. This is more proof that our country has been completely sold out by a group of traitors at all levels of government.

American kids, dumber than dirt

Mark Morford
SF Gate
October 24, 2007

I have this ongoing discussion with a longtime reader who also just so happens to be a longtime Oakland high school teacher, a wonderful guy who’s seen generations of teens come and generations go and who has a delightful poetic sensibility and quirky outlook on his life and his family and his beloved teaching career.

And he often writes to me in response to something I might’ve written about the youth of today, anything where I comment on the various nefarious factors shaping their minds and their perspectives and whether or not, say, EMFs and junk food and cell phones are melting their brains and what can be done and just how bad it might all be.

His response: It is not bad at all. It’s absolutely horrifying.

My friend often summarizes for me what he sees, firsthand, every day and every month, year in and year out, in his classroom. He speaks not merely of the sad decline in overall intellectual acumen among students over the years, not merely of the astonishing spread of lazy slackerhood, or the fact that cell phones and iPods and excess TV exposure are, absolutely and without reservation, short-circuiting the minds of the upcoming generations. Of this, he says, there is zero doubt.

Nor does he speak merely of the notion that kids these days are overprotected and wussified and don’t spend enough time outdoors and don’t get any real exercise and therefore can’t, say, identify basic plants, or handle a tool, or build, well, anything at all. Again, these things are a given. Widely reported, tragically ignored, nothing new.

No, my friend takes it all a full step — or rather, leap — further. It is not merely a sad slide. It is not just a general dumbing down. It is far uglier than that.

We are, as far as urban public education is concerned, essentially at rock bottom. We are now at a point where we are essentially churning out ignorant teens who are becoming ignorant adults and society as a whole will pay dearly, very soon, and if you think the hordes of easily terrified, mindless fundamentalist evangelical Christian lemmings have been bad for the soul of this country, just wait.

It’s gotten so bad that, as my friend nears retirement, he says he is very seriously considering moving out of the country so as to escape what he sees will be the surefire collapse of functioning American society in the next handful of years due to the absolutely irrefutable destruction, the shocking — and nearly hopeless — dumb-ification of the American brain. It is just that bad.

Now, you may think he’s merely a curmudgeon, a tired old teacher who stopped caring long ago. Not true. Teaching is his life. He says he loves his students, loves education and learning and watching young minds awaken. Problem is, he is seeing much less of it. It’s a bit like the melting of the polar ice caps. Sure, there’s been alarmist data about it for years, but until you see it for yourself, the deep visceral dread doesn’t really hit home.

He cites studies, reports, hard data, from the appalling effects of television on child brain development (i.e.; any TV exposure before 6 years old and your kid’s basic cognitive wiring and spatial perceptions are pretty much scrambled for life), to the fact that, because of all the insidious mandatory testing teachers are now forced to incorporate into the curriculum, of the 182 school days in a year, there are 110 when such testing is going on somewhere at Oakland High. As one of his colleagues put it, “It’s like weighing a calf twice a day, but never feeding it.”

But most of all, he simply observes his students, year to year, noting all the obvious evidence of teens’ decreasing abilities when confronted with even the most basic intellectual tasks, from understanding simple history to working through moderately complex ideas to even (in a couple recent examples that particularly distressed him) being able to define the words “agriculture,” or even “democracy.” Not a single student could do it.

It gets worse. My friend cites the fact that, of the 6,000 high school students he estimates he’s taught over the span of his career, only a small fraction now make it to his grade with a functioning understanding of written English. They do not know how to form a sentence. They cannot write an intelligible paragraph. Recently, after giving an assignment that required drawing lines, he realized that not a single student actually knew how to use a ruler.

It is, in short, nothing less than a tidal wave of dumb, with once-passionate, increasingly exasperated teachers like my friend nearly powerless to stop it. The worst part: It’s not the kids’ fault. They’re merely the victims of a horribly failed educational system.

Then our discussion often turns to the meat of it, the bigger picture, the ugly and unavoidable truism about the lack of need among the government and the power elite in this nation to create a truly effective educational system, one that actually generates intelligent, thoughtful, articulate citizens.

Hell, why should they? After all, the dumber the populace, the easier it is to rule and control and launch unwinnable wars and pass laws telling them that sex is bad and TV is good and God knows all, so just pipe down and eat your Taco Bell Double-Supremo Burrito and be glad we don’t arrest you for posting dirty pictures on your cute little blog.

This is about when I try to offer counterevidence, a bit of optimism. For one thing, I’ve argued generational relativity in this space before, suggesting maybe kids are no scarier or dumber or more dangerous than they’ve ever been, and that maybe some of the problem is merely the same old awkward generation gap, with every current generation absolutely convinced the subsequent one is terrifically stupid and malicious and will be the end of society as a whole. Just the way it always seems.

I also point out how, despite all the evidence of total public-education meltdown, I keep being surprised, keep hearing from/about teens and youth movements and actions that impress the hell out of me. Damn kids made the Internet what it is today, fer chrissakes. Revolutionized media. Broke all the rules. Still are.

Hell, some of the best designers, writers, artists, poets, chefs, and so on that I meet are in their early to mid-20s. And the nation’s top universities are still managing, despite a factory-churning mentality, to crank out young minds of astonishing ability and acumen. How did these kids do it? How did they escape the horrible public school system? How did they avoid the great dumbing down of America? Did they never see a TV show until they hit puberty? Were they all born and raised elsewhere, in India and Asia and Russia? Did they all go to Waldorf or Montessori and eat whole-grain breads and play with firecrackers and take long walks in wild nature? Are these kids flukes? Exceptions? Just lucky?

My friend would say, well, yes, that’s precisely what most of them are. Lucky, wealthy, foreign-born, private-schooled … and increasingly rare. Most affluent parents in America — and many more who aren’t — now put their kids in private schools from day one, and the smart ones give their kids no TV and minimal junk food and no video games. (Of course, this in no way guarantees a smart, attuned kid, but compared to the odds of success in the public school system, it sure seems to help). This covers about, what, 3 percent of the populace?

As for the rest, well, the dystopian evidence seems overwhelming indeed, to the point where it might be no stretch at all to say the biggest threat facing America is perhaps not global warming, not perpetual warmongering, not garbage food or low-level radiation or way too much Lindsay Lohan, but a populace far too ignorant to know how to properly manage any of it, much less change it all for the better.

What, too fatalistic? Don’t worry. Soon enough, no one will know what the word even means.

Merrill Lynch Reports Biggest Quarterly Loss in Its 93-Year History

Bradley Keoun
Bloomberg
October 25, 2007

Merrill Lynch & Co. reported the biggest quarterly loss in its 93-year history after taking $8.4 billion of writedowns, almost double the firm’s forecast three weeks ago.

The writedowns on subprime mortgages, asset-backed bonds and leveraged loans led to a third-quarter loss of $2.24 billion, or $2.82 a share, six times more than Merrill estimated on Oct. 5. Chief Executive Officer Stanley O’Neal said today that the New York-based firm may sell assets to shore up its balance sheet.

Merrill’s stock fell the most in five years, its credit rating was cut and the perceived risk of default on the company’s bonds rose after O’Neal said the firm misjudged the severity of the decline in debt markets since July. Investors who lauded the 56-year-old CEO for chasing higher returns as the biggest underwriter of securities backed by subprime loans now question his management. O’Neal said the firm increased the writedown after a more “conservative” analysis of its holdings.

“We’re very disappointed,” said Rose Grant, who helps manage about $2 billion at Eastern Investment Advisors in Boston, including Merrill shares. “I don’t think Stan O’Neal will step down, but you do have to look at top management and wonder why they didn’t know the extent of this loss.”

‘Startling’

Standard & Poor’s, Fitch Ratings and Moody’s Investors Service lowered their assessments of Merrill’s credit. S&P cut its rating on Merrill’s senior unsecured debt to A+ from AA-, describing the quarter’s loss as “startling” and citing “management’s miscues” that raised concern about the firm’s risk controls and business strategy.

Financial stocks sank, led by Merrill, which dropped 5.8 percent to $63.22 in New York Stock Exchange trading. Lehman Brothers Holdings Inc., the largest U.S. underwriter of mortgage bonds, declined 1.5 percent to $57.42. Bear Stearns Cos., the second-biggest, fell 2.3 percent to $113.54.

Merrill’s third-quarter revenue fell 94 percent to $577 million, as losses in the fixed-income division overshadowed gains from underwriting stocks and providing merger advice. At Merrill’s retail brokerage, the nation’s biggest with a network of 16,610 financial advisers who cater to individual investors, revenue climbed 23 percent to $3.27 billion.

O’Neal, on a conference call with analysts, said he was “continuing to resize” the firm’s balance sheet. He also said he’s weighing potential divestitures of “non-core” businesses.

BlackRock Stake

The firm owns stakes in companies including BlackRock Inc., the largest publicly traded U.S. fund manager. Merrill is also a passive minority investor in Bloomberg LP, the parent of Bloomberg News.

The BlackRock stake isn’t for sale, O’Neal said on the call. “We want to own this asset for the foreseeable future,” he said. He declined to comment on other investments.

Merrill’s compensation costs fell by 49 percent from a year earlier to $1.99 billion, indicating that the quarter’s losses may reduce year-end bonuses for some of Merrill’s 64,200 employees. The firm said today that it “remains focused on paying its best performing employees competitively.”

Merrill said its holdings of so-called collateralized debt obligations, or CDOs, along with other securities and loans linked to subprime mortgages, lost $7.9 billion of their value in the quarter. CDOs are bonds created from pools of debt securities and loans.

The size of the writedown increased from $5 billion after Merrill conducted “additional analysis” since the firm’s Oct. 5 announcement, O’Neal said on the conference call.

‘Remaining Impact’

“We expect market conditions for subprime mortgage-related assets to continue to be uncertain and we are working to resolve the remaining impact from our positions,” he said in the company statement.

Merrill also wrote down the value of leveraged buyout loans the firm couldn’t sell to investors by $463 million, after underwriting fees.

Taken together, the charges are the biggest ever by a Wall Street firm, said Charles Geisst, a finance professor at Manhattan College in Riverdale, New York.

“It’s safe to say this is the largest writedown” by a U.S. securities firm, said Geisst, the author of “100 Years of Wall Street.” “The only other time we had such big losses was the third-world debt crisis in the 1980s. Even then, the losses didn’t match this one.”

Merrill’s writedown exceeded Citigroup Inc.’s $6.5 billion and increased to more than $30 billion the total third-quarter cost for bad loans and trading losses reported by the world’s biggest securities firms and banks.

Worst Performer

Slumping credit markets have led to the dismissal of industry executives including UBS AG Chief Executive Officer Peter Wuffli and Bear Stearns Co-President Warren Spector, and resulted in Lehman Brothers Holdings Inc., E*Trade Financial Corp., Citigroup and Merrill losing more than 20 percent of their stock market value.

Merrill said it reduced its inventory of CDOs comprised of asset-backed securities by 53 percent during the quarter to $15.2 billion. The firm also whittled down the size of its LBO loan commitments to $31 billion, 42 percent less than at the end of the second quarter. Short-term borrowings climbed 80 percent from the second quarter and shareholders’ equity declined 9.6 percent.

The company’s shares dropped as low as $61.40 today in New York trading, the biggest decline since Sept. 17, 2001, according to Bloomberg data.

The stock is the worst performer among the five biggest U.S. securities firms this year, followed by Bear Stearns, where two hedge funds lost $1.6 billion of clients’ money. Merrill has dropped about 32 percent, and Bear Stearns has fallen 30 percent.

Investors Flee

Goldman Sachs Group Inc., the biggest securities firm by market value, has gained 13 percent. No. 2 Morgan Stanley is down 7 percent. All the companies are based in New York.

Credit-default swaps tied to Merrill Lynch bonds rose 5 basis points to 95 basis points, according to Phoenix Partners Group in New York. That’s more than double where they were two weeks ago and almost six times the spread at the beginning of the year. The cost of the swaps, which are contracts protecting payments on bonds, rises as the perception of credit quality worsens.

Merrill, the third-biggest securities firm, is the only one of Wall Street’s five largest to report a loss from the credit contraction. Investor flight from subprime mortgage bonds and related debt left the company with inventories of loans and securities that had to be written down to depressed market prices.

‘Serious Embarrassment’

“If you can’t guide toward a reasonable expectation over two weeks, clearly you’ve got bigger problems,” said William Fitzpatrick, a financial-services analyst at Johnson Asset Management in Racine, Wisconsin, which oversees $1.7 billion and does not own Merrill shares.

Goldman reported a 79 percent increase in profit for the three months ended Aug. 31 after betting on a drop in prices of securities tied to home loans. Morgan Stanley said profit from operations fell 7 percent in the quarter.

Earlier this month, Merrill fired Osman Semerci, the head of its fixed-income trading division, as well as Dale Lattanzio, one of Semerci’s top U.S. deputies. Merrill also severed ties with Dow Kim, its former co-head of trading and investment-banking, who oversaw fixed-income trading until May, when he left to start his own hedge fund.

“This is a serious embarrassment for O’Neal,” said James Ellman, president of San Francisco-based Seacliff Capital in San Francisco, which oversees more than $200 million.

Skeletons

Merrill said in an Oct. 5 statement that it also had to write off $100 million related to First Franklin Financial Corp., a home-lending company that it bought for $1.3 billion on Dec. 30.

Investors’ refusal to finance mortgages with a high risk of default has made subprime lending unprofitable, forcing more than 110 companies to close, file for bankruptcy or put themselves up for sale since the beginning of 2006. Current and former clients of San Jose, California-based First Franklin say the unit is now barely taking loan applications.

“We’ve got more skeletons to find out about, because the credit cycle has yet to play out,” said Jon Fisher, who helps oversee $22 billion at Fifth Third Asset Management and doesn’t own Merrill shares. “This isn’t over in just a year.”

US home sales hit fresh lows, unsold properties flood market

Brisbane Times
October 25, 2007

Sales of US homes and apartments tumbled a hefty 8.0 percent in September extending one of the nation’s worst housing slumps in decades, an industry group said Wednesday.

The National Association of Realtors (NAR) said in a monthly snapshot that sales of existing homes and apartments fell to a seasonally adjusted rate of 5.04 million units in September from 5.48 million in August.

The drop was worse than expected. Most economists had only expected sales to decline to around 5.25 million. August sales were revised lower from an original tally of 5.50 million homes.

Stripping out apartment turnover, sales dived to their lowest level since January 1998.

Analysts said the grim news boosts the odds that the Federal Reserve will cut interest rates for the second time in as many months at a policy meeting next Wednesday.

The depth of the housing depression was underlined by an annual reading which showed sales of homes and apartments across the United States have plummeted a dramatic 19.1 percent from September 2006.

The sales slowdown has pushed home prices lower in many cities in the past 12 months in a market downturn which has also forced many mortgage lenders out of business.

The national median existing-home price for all housing types fell 4.2 percent from a year ago to 211,700 US dollars.

The glut of unsold homes swamping the market rose 0.4 percent at the end of September to 4.40 million, marking a 10.5-month supply at the current sales pace.

Excluding apartments, the number of unsold homes flooding the market has spiked to its highest level since February 1988.

“Existing homes sales fell sharply in September,” said Stephen Gallagher, an economist at Societe Generale.

“Potential buyers, those without credit obstacles, had plenty of reason to wait and see hoping for greater supply or declining prices,” Gallagher said.

Economists are worried that the housing slowdown could put a brake on US economic growth.

“Until the federal government takes affirmative steps to rebuild the mortgage and bond markets with meaningful reforms, home prices will continue weak, and the economy will remain at risk,” said Peter Morici, an economist at the University of Maryland.

“Tipping from 1.5 percent growth into recession is easily done. It takes no more than a sneeze from the Middle East or some kind of currency crisis,” Morici said, referring to his forecast for fourth-quarter growth.

The Fed slashed borrowing costs last month and many economists expect the central bank to implement a fresh cut in its federal funds short term interest rate, presently pegged at 4.75 percent, next week.

US Treasury Secretary Henry Pauslon warned last week that the housing woes could see over one million homes repossessed this year as many Americans fail to meet their mortgage payments.

Tens of thousands of Americans with poor finances were sold “subprime” mortgages during the housing boom which ran out of steam in early 2006.

Such mortgages were often marketed with low “teaser” rates, many of which are due to reset to higher rates in the coming year. Economists fear already over-stretched borrowers are at risk of losing their homes because they will not be able to meet increased mortgage payments.

The depression is also taking a toll on corporate America.

Merrill Lynch, the giant Wall Street investment bank, disclosed Wednesday it had been forced to writeoff 7.9 billion US dollars in losses largely stemming from soured mortgage investments.

Other banks have also sustained big losses from mortgage-backed securities.

And America’s biggest mortgage lender, Countrywide Financial, said Tuesday it was offering new terms to tens of thousands of customers to stave off the risk of foreclosures, with loans totalling around 16 billion US dollars.

Home sales fell the most in the northeast of the country, dropping 10 percent in September, followed by lesser declines in the West, Midwest and South.

Rate fears undermine dollar

Peter Garnham
Financial Times
Thursday October 25, 2007

The dollar remained on the back foot on Thursday as the prospect of further cuts in US interest rates continued to weigh on the currency.

Analysts said weak US housing figures released on Wednesday, combined with poor third-quarter results from Merrill Lynch, the US banking group, had added to the gloom surrounding the prospects for the US economy.

Lee Hardman, currency economist at the Bank of Tokyo-Mitsubishi UFJ, said although markets were now fully pricing a 25 basis-point cut at the Federal Reserve’s meeting on October 31, the potential for a 50 point cut should not be ruled out given the rapidly deteriorating conditions in the housing market and dislocated financial market conditions.

“In an environment pointing to a pronounced slowdown in US economic growth and additional monetary easing in the US, the dollar is likely to come under further downward pressure,” he said.

The dollar eased 0.1 per cent to $1.4277 against the euro, within a cent of the record low around $1.4350 it hit against the single currency on Monday.

The euro was also supported as the German Ifo index of business sentiment fell by less than expected in September.

“The survey supports our view that, while the German recovery has passed its peak, growth remains relatively healthy for now,” said Jennifer McKeown at Capital Economics.

The dollar also dropped 0.2 per cent to SFr1.1695 against the Swiss franc and 0.2 per cent to C$0.9667 against the Canadian dollar.

However, the pound eased 0.1 per cent to $2.0480 against the dollar and fell 0.2 per cent to £0.6969 against the euro after the Bank of England warned that the UK financial system remained vulnerable to new shocks from the global credit squeeze.

Hans Redeker at BNP Parisbas said the report suggested that the UK economy was more vulnerable than recent speeches by member of the central bank’s monetary policy committee and various third-quarter UK economic data releases might have suggested.

Full article here.

Terror watch list swells to more than 755,000

Mimi Hall
USA TODAY
Thursday October 25, 2007

WASHINGTON — The government's terrorist watch list has swelled to more than 755,000 names, according to a new government report that has raised worries about the list's effectiveness.

The size of the list, typically used to check people entering the country through land border crossings, airports and sea ports, has been growing by 200,000 names a year since 2004. Some lawmakers, security experts and civil rights advocates warn that it will become useless if it includes too many people.

"It undermines the authority of the list," says Lisa Graves of the Center for National Security Studies. "There's just no rational, reasonable estimate that there's anywhere close to that many suspected terrorists."

The exact number of people on the list, compiled after 9/11 to help government agents keep terrorists out of the country, is unclear, according to the report by the Government Accountability Office (GAO). Some people may be on the list more than once because they are listed under multiple spellings.

Senate Homeland Security Committee Chairman Joe Lieberman, D-Conn., who plans a hearing on the report today, says "serious hurdles remain if (the list) is to be as effective as we need it to be. Some of the concerns stem from its rapid growth, which could call into question the quality of the list itself."

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About 53,000 people on the list were questioned since 2004, according to the GAO, which says the Homeland Security Department doesn't keep records on how many were denied entry or allowed into the country after questioning. Most were apparently released and allowed to enter, the GAO says.

Leonard Boyle, director of the FBI's Terrorist Screening Center, which maintains the list, says in testimony to be given today that 269 foreigners were denied entry in fiscal 2006.

The GAO report also says:

•The Transportation Security Administration (TSA) could not specify how many people on its no-fly list, which is a small subset of the watch list, might have slipped through screening and been allowed on domestic flights.

•TSA data show "a number of individuals" on the no-fly list passed undetected through screening and boarded international flights bound for the United States. Several planes have been diverted once officials realized that people named on the watch lists were on board.

•Homeland Security has not done enough to use the list more broadly in the private sector, where workers applying for jobs in sensitive places such as chemical factories could do harm.

Boyle also urges that the list be used by for screening at businesses where workers could "carry out attacks on our critical infrastructure that could harm large numbers of persons or cause immense economic damage."

But the sheer size of the watch list raised the most alarms.

"They are quickly galloping towards the million mark — a mark of real distinction because the list is already cumbersome and is approaching absolutely useless," said Tim Sparapani of the American Civil Liberties Union.

Sen. Susan Collins, R-Maine, says "creating and maintaining a comprehensive terrorist watch list is an enormous endeavor fraught with technical and tactical challenges."

The report, she says, "underscores the need to make the watch lists more accurate, to improve screening procedures at airports and the ports of entry, and to provide individuals with the ability to seek redress if they believe they have been wrongfully targeted."

Buffett sees dollar weakness

Angela Moon
Reuters
Thursday October 25, 2007

Billionaire investor Warren Buffett said on Thursday he expected the dollar to weaken further, adding that South Korean stocks offered better value than other world markets.

Buffett, worth $52 billion according to Forbes magazine in March, said his Berkshire Hathaway (BRKa.N: Quote, Profile, Research) company is still on the hunt for bargains as the U.S. subprime mortgage crisis plays out.

"We are still negative on the dollar. We bought stocks in companies that are earning their money in other currencies," he told reporters during a visit to Berkshire's Korean cutting tool maker subsidiary, TaeguTec.

Berkshire Hathaway, which owns more than 70 businesses and has some $100 billion of stock and bond investments, has a stake in only one listed South Korean company, the world's fourth-biggest steelmaker POSCO (005490.KS: Quote, Profile, Research). Berkshire said in March it held a 4 percent stake in POSCO as of the end of 2006.

"We are gaining foreign currency exposure that we like," said the veteran investor, known as the "Oracle of Omaha" for his astute investments.

The U.S. currency has lost 23 percent against the South Korean won since the end of 2003, hit by accumulating current account surpluses in South Korea and a steady inflow of portfolio investment into the country's financial markets.

International Monetary Fund Managing Director Rodrigo Rato said on Monday the U.S. currency was still overvalued and that there was room for further depreciation.

Full article here.

Bill Clinton Speech Interrupted By 9/11 Truthers

Kare 11
Thursday October 25, 2007

Comment: Clinton is right - 9/11 wasn't an inside job, and Bill never had sex with that woman.

Former President Bill Clinton predicted Tuesday that his wife, Hillary Rodham Clinton, is likely to have a more difficult time winning the Democratic presidential nomination than she would the general election.

"I wouldn't be surprised if the primary is tougher than the general," the former president said at a Minneapolis fundraiser for his wife's campaign, arguing that she's more immune to attacks from Republicans because "they don't have anything new to say about her."

Because of the current political climate, Clinton said Democrats are in prime position to reclaim the presidency.

"I think we can run anybody and win if we run a smart campaign," Clinton said. That gives Democrats the opportunity to pick the most qualified candidate for the job, he said, making the pitch that Hillary Clinton is that candidate.

Clinton's 50-minute speech, which started about an hour behind schedule, was derailed briefly by several hecklers in the audience who shouted that the 2001 terrorist attacks were a fraud. Rather than ignoring them, Clinton seemed to relish a direct confrontation.

"A fraud? No, it wasn't a fraud," Clinton said, as the crowd cheered him on. "I'll be glad to talk to you if you shut up and let me talk."

When another heckler shouted that the attacks were an "inside job," Clinton took even greater umbrage.

"An inside job? How dare you. How dare you. It was not an inside job," Clinton said. "You guys have got to be careful, you're going to give Minnesota a bad reputation."

Bush Budget Request Raises Fears Of Iran Strike, Increases Funding For ‘Massive’ ‘Bunker Buster’

Think Progress
Thursday October 25, 2007

In light of the administration’s increasingly threatening rhetoric on Iran, CQ reports that members of Congress are worried by Bush’s recent budget proposal. In particular, they cite his request to equip B-2 “stealth” bombers with a new 30,000-pound bunker buster as a “sign of plans for an attack on Iran“:

Buried in the $196.4 billion supplemental war spending proposal that Bush submitted to Congress on Oct. 22 is a request for $88 million to modify B-2 bombers so they can drop a Massive Ordnance Penetrator, or MOP, a conventional bomb still in development that is the most powerful weapon designed to destroy targets deep underground.

A White House summary accompanying the supplemental spending proposal said the request for money to modify �B-2s to carry the bombs came in response to “an urgent operational need from theater commanders.” […]

Previous statements by the Defense Department and the program’s contractors, along with interviews with military experts, suggest the weapon is meant for the kind of hardened targets found chiefly in Iran.

The B-2 bomber and MOPs are reportedly choice weapons for strikes against Iranian nuclear facilities. In January, the BBC reported that the administration had drawn up plans for “long range B2 stealth bombers” to “drop ‘bunker-busting‘ bombs” in an effort to penetrate, for example, the Natanz enrichment facility in Iran.

The MOP has been in development for several years. After its completion, a U.S. military officer proudly described the destructive power of the bunker buster, specifically saying it could be used against Iran:

The U.S. has a 14-ton super bomb more destructive than the vacuum bomb just tested by Russia, a U.S. general said Wednesday.

The statement was made by retired Lt. General McInerney, chairman of the Iran Policy Committee, and former Assistant Vice Chief of Staff of the Air Force.

McInerney said the U.S. has “a new massive ordnance penetrator that’s 30,000 pounds, that really penetrates … Ahmadinejad has nothing in Iran that we can’t penetrate.”

– Mike Kuykendall

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U.S. "undoubtedly in recession": Jim Rogers

Reuters
Thursday October 25, 2007

The United States has entered a recession, according to highly-regarded investor Jim Rogers, who told Britain's Daily Telegraph newspaper on Wednesday he was switching out of the dollar and into yen, the yuan and the Swiss franc.

The veteran investor, who predicted the 1999 commodities rally, also said he was still bullish about surging Chinese stock markets despite worries over a bubble.

Fears are growing over the health of the U.S. economy after the fallout from the subprime mortgage market crisis and the global credit crunch it triggered.

The U.S. Federal Reserve has already slashed borrowing costs by 50 basis points to 4.75 percent to try and shore up the world's biggest economy and is widely expected to lower interest rates again next week.

"The US economy is undoubtedly in recession," Rogers told the Telegraph in Hong Kong in an article published on its Website.

"Many parts of industry are actually in a state worse than recession. If it were not for (Federal Reserve Chairman Ben) Bernanke putting huge amounts of money into the market, the stock market would probably be down much more than it is."

Rogers, who co-founded the Quantum Fund with billionaire investor George Soros in the 1970s, said it made sense to desert the dollar.

"All other things being equal during the next six months, that's the way I will go," he said. "But if the Swiss franc goes through the roof, I probably won't put money into the Swiss franc."

And he dismissed worries for now that surging Chinese equities had formed a bubble.

Full article here.

FBI agents shoot dead 'arsonist' as police reveal California fires were started deliberately

UK Daily Mail
Thursday October 25, 2007

A suspected arsonist was shot dead by police as FBI agents revealed several of the fires that have forced one million people from their homes in southern California had been started deliberately.

Police said officers killed a man during a chase as he tried to escape when challenged in the city of San Bernardino.

A motorcyclist who police say set a small fire in the foothills of the San Bernardino Mountains was arrested but investigators said they did not know whether he was connected to any of the larger fires.

FBI agents confirmed that a huge fire in the town of Santiago in Orange County that destroyed 10 homes was started on purpose in two different places.

A £35,000 reward was offered for information to trace the arsonists today as a break in the weather finally allowed firefighters to make progress after virtually conceding defeat to the series of wildfires that have been fanned by fierce winds.

President Bush arrived in California after declaring the country's worst nightmare since Hurricane Katrina a "major disaster".

Insurance companies estimated that property worth more than £600 million has been destroyed in four days of fires.

More than 1,500 homes and more than 700 square miles of land have been scorched across five counties, from Ventura in the north all the way down to Mexico. The office of emergency services said 28,000 homes were still threatened.

Many residents along the coastline from Malibu to San Diego, through the inland canyons to the mountain playgrounds of Lake Arrowhead and Running Springs, returned home last night to find just burning rubble.

Thousands more waited anxiously in makeshift evacuation camps, not knowing if they had lost everything they own.

The improving weather has allowed for a greater aerial assault on the flames with helicopters and air tankers dropping tons of water.

Just one death has been directly attributed to the fires, a man who refused to leave his home, although six others died during the evacuations and about 50 people have been injured, including 20 firefighters.