Addressing Terrorist Threats

cropped-bob-shapiro.jpg   By Bob Shapiro

In any movement, there are players with differing amounts of enthusiasm, who give differing amounts of support to the movement. Some may be provocative in their actions, while others though generally opposed to the outcome of the movement, may be counted as supporters by their silence. The silence may be due to fear of reprisal or because life gives them more important things to concentrate on.

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The Euro May Be Riskier Than You Think

By Alasdair Macleod – Re-Blogged From http://www.Silver-Phoenex500.com

Finance ministers in the Eurozone appear to have had a free lesson in game theory from Professor Yanis Varoufakis, the Greek finance minister. At the time of writing Greece’s future in the Eurozone is far from secured, but it appears that Greece has achieved something.

He gave his fellow finance ministers a deal they dared not refuse, though it still has to be ratified by some parliaments, including Germany’s today. Varoufakis almost certainly understands that the Eurozone is in a weaker position than the bureaucrats and finance ministers themselves believed. It was important for them to become aware of this reality, which was central to his approach.

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The Ammo Ban and the Economy

cropped-bob-shapiro.jpg   By Bob Shapiro

Many Americans, liberal and conservative, have never read the US Constitution. It’s not taught in the public schools, except to say that it exists.

Of those Americans who have at least a clue of what our Founding Document says, many, especially on the liberal side, frequently interpret the actual words written in the Constitution to mean the opposite of what they say. This can have both Economic ramifications and Liberty issues.

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A Global Warming Allegory

Guest essay by William M. Briggs, statistician. Reposted from his blog wmbriggs.com
and From http://www.WattsUpWithThat.com
A very odd thing happened in Science. Turns out a famous weatherman has been forecasting highs in the 60s then 70s for New York City all winter long. But the temperature never rose above the single digits, teens, twenties, and thirties.

One day a writer at the New York Post wrote an article telling people not to trust the weatherman, who, it turned out, had issued a prediction for the following day for a “High of 80!”

Climatologists stationed at NASA on the Upper West Side were incensed that a non-scientist would interfere with Science. So the climatologists

 

spoke with the weatherman, who said he was basing his predictions on a sophisticated computer model. The weatherman admitted his difficulties, but said his model would have performed great if only he had better measures of surface snow cover.

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Stop Wasting Money on Miracles

cropped-bob-shapiro.jpg   By Bob Shapiro

Let’s imagine for a moment.

A scientist discovers a new insect which can produce a new kind of fiber. But, not just a mere fiber, it comes out as a full sheet of cloth!

Some commercial enthusiasts of the new discovery say that, since there is zero processing cost to take the fiber from rough to thread to cloth sheet, it is a free supply of material. They do acknowledge that setting up a colony of the insects is expensive and the colony covers a broad swath of land.

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Perverse Incentives

  

By ROBERT P. MURPHY – Re-Blogged From http://www.FEE.org

Just about everyone agrees that incentives affect behavior, but economists really mean it. That’s because economists take the logic of incentives further than most other people are willing to. Such analysis often reveals that government policies have unintended consequences that seem shocking to the average person. The list includes welfare programs that lead to higher rates of birth out of wedlock, seatbelt laws that lead to more pedestrian deaths, and even the possibility of changes in estate taxation that lead to people strategically timing their deaths.

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Should the Federal Reserve be free of supervision while it carries out vast monetary experiments?

 

The “Audit the Fed” proposal of Senator Rand Paul (R-Ky.) elicits a surprising amount of emotion, from opponents and supporters alike. Why should this be?

“Monetary policy” purposefully sounds technical and dull—you like it that way if you want to keep it the domain of supposedly objective experts who don’t want any mere politicians interfering in their elite central banking club. But money affects everybody and is an emotional topic, especially if the Fed is on purpose crushing you, as it currently is doing to savers, in order to benefit borrowers and speculators.

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Global Banana Republic

By Bill Holter – Re-Blogged From http://www.milesfranklin.com/

In case you had not noticed, we live in a crazy upside down sort of world.  We could go into the social aspect of this but it would only make our collective blood pressures go up.  The same thing goes for politics, religion and let’s not forget an entire industry that used to pride itself on digging for the truth, the media.  Nothing, and I do mean NOTHING “is” really as it seems today.  Everything is spun, everything is either glossed over or not even discussed (reported on) and nothing is real anymore.  Somehow, I think Goebbels is blushing in his grave and Orwell kicking himself for not being outrageous enough when he wrote 1984.

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Greed – Good or Bad?

cropped-bob-shapiro.jpg   By Bob Shapiro

Most Americans are greedy most of the time.

If we own a business, we want as much profit as we can generate. If we buy stocks, we want the price to go way up. If we work, we want to be paid as much as we can get. If we sell a house or a car, we want to get as much as we can. Of course, when we buy a house or a car, we want to pay as little as possible.

In every single transaction, we want to get the better of the deal compared to the person on the other side of the table. Is this a good thing – or an evil we should strive to stamp out?

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Weekly climate and energy news roundup #169

The Week That Was: February 21, 2015 – Brought to You by www.SEPP.org

By Ken Haapala, President, Science and Environmental Policy Project (SEPP) – Re-Blogged From http://www.WattsUpWithThat.com

Sea Level Change: The threat of global warming is no longer intensely promoted by governments. No significant temperature rise for over a decade has had its effects. The threat of climate change is apparently wearing thin with the public, Perhaps the public realizes that the climate has been changing for hundreds of millions of years, long before humanity existed. It appears that some governments, including the US Administration, are using the threat of significant sea level rise to compel the public to do their bidding.

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The Gold Standard For Skeptics

By Keith Weiner – Re-Blogged From http://www.Gold-Eagle.com

A skeptic said to me recently, “The dollar is money and gold isn’t.”

I asked, “OK, how do you define money?”

He responded, “You use dollars to buy groceries, not gold.”

He defines money as the accepted medium of exchange. Let’s drill deeper into that.

The government forces gold out of circulation. Taxation is one way (there are others). If the price of gold rises, it’s taxed as a capital gain. The result is that gold cannot circulate, because no one wants the possibility of a tax bill on every transaction.

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Big Brother Food Controllers Want Higher Taxes

Stupidity from the food Nazis!

By Mark Horne – Re-Blogged From http://www.PoliticalOutcast.com

Tax-feeding “scientists” want us to pay higher taxes on sugary foods and drinks. From Bloomberg Business: “Tax on Sugary Foods Proposed by U.S. Panel to Fight Obesity.”

Americans should pay taxes on sugary sodas and snacks as a way to cut down on sweets, though they no longer need to worry about cholesterol, according to scientists helping to revamp dietary guidelines as U.S. obesity levels surge.

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The Myth of the Depression of 1873: More Evidence of a Bright Future for Austrian Economics

By John P. Cochran – Re-Blogged From http://www.Mises.org

More evidence the future of Austrian economics is in good hands is Patrick Newman’s (a PhD student at George Mason University and a participant in the 2012 Mises Institute Summer Fellowship program) excellent piece of scholarship recently published in the Quarterly Journal of Austrian Economics as “The Depression of 1873: An Austrian Perspective.”  The paper is extremely important and timely as the Great Depression of 1873-1879 is often used against Austrians as a counter example of a long depression with relatively laissez-faire macro policies and no central bank. An example is provided by Jeffrey M. Herbener in a short blog that provides a response based on work by Rothbard.

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Fawlty Towers and Ivory Towers

Guest opinion by Charles Battig – Re-Blogged From http://www.WattsUpWithThat.com

John Cleese’s 1970’s “Fawlty Towers” of BBC fame provided a satirical view of an inept hotel manager in his dealings with potential guests, “who is tortured by ‘that annoying section of the general public who insist on staying at hotels.’” Today, the torture is to that “annoying section of the general public” who insist on scientific integrity in the reports issued by the science community. Today’s “Fawlty Towers” are the “Faulty Ivory Towers of Science.”

Fawlty_Towers_title_card[1]

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When is Weather Extreme?

cropped-bob-shapiro.jpg   By Bob Shapiro

Climate Change Alarmists like to scan the weather news for new weather records being set, especially flashy records like Boston’s recent “Heaviest snowfall during a 30 day period.” To this group, every record is proof of their Extreme Climate predictions.

But, what this group fails to understand – or fails to tell the truth about if the DO understand – is the likelihood that records will be set.

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How’s the US Economy?

cropped-bob-shapiro.jpg   By Bob Shapiro

How’s the US Economy doing? That depends on who you ask.

The “official” unemployment rate, at 5.7% is a little high by historical standards, but way down from the peak of the Great Recession. The US Dollar is way up in Forex Markets, and that usually means that the US Economy is booming and everyone wants our strong currency. GDP is up again – at a 3.8% annual rate during the 2nd half of last year.

Who could ask for anything more?! Let’s look at these and other numbers a little more deeply.

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Can We Stop the Doom Mongering?

By Anthony Watts – Re-Blogged From http://www.WattsUpWithThat.com

A letter to the editor which appeared in the Norman, OK Transcript reprinted here with permission of the author, Dr. David Deming:


I write in rebuttal to the Feb. 12 letter by Nancy Smart advising us to “listen” to climate scientists. According to Ms. Smart, climate science is “settled.” Instead of thinking for ourselves, she recommends we obsequiously follow the dictates of “our most respected and highest level scientific agencies.”

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Beware The Stock Bear!

The US stock markets’ latest record highs have left traders exceedingly euphoric and complacent.  They are utterly convinced this stock bull will power higher for years to come.  But their enthusiasm is very misplaced.  In real inflation-adjusted terms, the US stock markets only just regained breakeven levels 15 years after the last secular bull peaked.  Now the secular stock bear ever since is overdue for a new cyclical bear.

The flagship benchmark index for tracking the US stock markets is the mighty S&P 500, often shortened to SPX.  The whole financial world literally revolves around this dominant index, with most global equity markets and even some major commodities markets like oil usually mirroring it.  American stock traders can directly trade the SPX through a handful of gargantuan ETFs including the leading SPY S&P 500 ETF.

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25% of World Prisoners From 5% Of Population

By Michael Krieger – Re-Blogged From http://www.davidstockmanscontracorner.com

There are 2.3 million Americans in prison or jail. The U.S. has 5 percent of the world’s population but 25 percent of its prisoners. One in three black men can expect to spend time in prison. There are 2.7 million minors with an incarcerated parent. The imprisonment rate has grown by more than 400 percent since 1970.

Recent research suggests that incarceration has lost its potency. A report released this week from the Brennan Center for Justice at the New York University School of Law finds that increased incarceration has had a very limited effect on crime over the past two and a half decades.

– From today’s Five-Thrity-Eight article: The Imprisoner’s Dilemma

The sickening and absurd rate of incarceration in these United States has been a frequent topic of conversation here at Liberty Blitzkrieg over the years (links at the end). In our national insanity, the U.S. has only 5% of the worlds population, yet 25% of its prisoners. Many of these people have no business being locked in a cage to begin with, and are wasting their lives away for committing “victimless crimes,” i.e. for no good reason.

While the immorality of locking up so many of our fellow citizens for non-crimes should be readily apparent, today’s article from Five-Thirty-Eight offers evidence that America’s incarceration rate has become so saturated that it has absolutely no meaningful impact in lowering crimes rates anyway. The time for prison reform and the elimination of mandatory minimum sentences is long overdue.

From Five-Thirty-Eight:

There are 2.3 million Americans in prison or jail. The U.S. has 5 percent of the world’s population but 25 percent of its prisoners. One in three black men can expect to spend time in prison. There are 2.7 million minors with an incarcerated parent. The imprisonment rate has grown by more than 400 percent since 1970.

It’s supposed to help the country reduce crime in two ways: incapacitation — it’s hard to be a habitual offender while in prison — or deterrence — people scared of prison may do their best to not end up there.

But recent research suggests that incarceration has lost its potency. A reportreleased this week from the Brennan Center for Justice at the New York University School of Law finds that increased incarceration has had a very limited effect on crime over the past two and a half decades.

At incarceration’s current elevated levels, the effect of more incarceration on crime is not statistically different than zero. It’s no longer working.

In 1970, there were just shy of 200,000 Americans in prison. Today there are more than 1.5 million — 496 prisoners for every 100,000 people. That’s more than in any developed country. According to the International Centre for Prison Studies, the imprisonment rate in Russia is 467. In the U.K., it’s 148. In France, 102. In Germany, it’s 76. In Japan, 50.

It’s because of these elevated levels that we’re likely to see diminishing returns. If we assume — fairly! — that the criminal justice system tends to incarcerate the worst offenders first, it becomes clear why. Once the worst offenders are in prison, each additional prisoner will yield less benefit in the form of reduced crime. Increased incarceration — and its incapacitation effect — loses its bite. And at its world-historic level, it’s not surprising that it would’ve lost nearly all of it.

 And diminishing returns are what we saw. Crime rates dropped as incarceration rates rose, for a time, but incarceration’s effect on crime weakened as more people were imprisoned. An increase in incarceration was responsible for something like 5 percent of the decrease in crime in the 1990s, when its levels were lower, but has played no meaningful role since. If I were speaking to a fellow economist, I’d say the incarceration elasticity of crime is not distinguishable from zero. At a cocktail party, I’d say that crime no longer responds to changes in incarceration.

Evidence of incarceration’s diminishing returns can be found outside of big data sets and regression models, too. It can also be found via a natural experiment. report from the Brookings Institution’s Hamilton Project compared the prisoner releases from California’s realignment with similar releases in Italy, following clemency legislation passed by the Italian Parliament. California saw no discernable change in crime. Italy saw a spike in crime. The reason? California’s incarceration rate was high, and Italy’s was low. Italy hadn’t yet

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David Stockman Interview: The Clock Is Ticking, The Carnage Is Coming Soon

David Stockman Interview At King World News

The clock is ticking.  The carnage is coming soon and it’s not merely Greece and whether it stays in the euro or not….“But it’s symptomatic of what I believe is the gathering crisis in the world, which is that our two-decade long grand experiment in financial bailouts, massive money printing by central banks everywhere, and non-stop Keynesian debt stimulus is heading towards the wall.

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Strange Allies in the War on Carbon Fuels

Guest opinion by Viv Forbes – Re-Blogged From http://www.WattsUpWithThat.com

What great cause could unite Prince Charles, President Obama, the Pope, the Arab Oil sheiks, the United Nations, the European Union, the Russians, the Chinese, Pacific Island Nations, most undeveloped countries, the glitterati of Hollywood, left-wing politicians, unrepentant reds, government media, the climate research industry, Big Oil, Big Gas and the Green Blob. It must be something posing a clear and urgent danger to all humanity?

No, the crusade that unites them all is the War on Carbon Fuels, focused mainly on that most vilified target, coal.

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UN Climate End Game

Guest opinion by David Archibald – Re-Blogged From http://www.WattsUpWithTht.com

“Everybody Wants To Rule The World” was a 1985 song by Tears For Fears. Now in 2015, a number of parties are doing their best to that end – ISIS in the Middle East, Russia chewing up the Ukraine, China in the East and South China Seas and the UN Climate Change Commission. A draft document out of Geneva gives details of the UN plan to rule the world.

For most of us, the memorable thing from the Lima climate late last year was Greenpeace’s despoiling of an ancient Nazca figure of a hummingbird.

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How to Balance the Budget

cropped-bob-shapiro.jpg   By Bob Shapiro

The US federal Budget has been in Deficit for generations. Our leaders in Washington have borrowed from our children without any prospect that the money will be paid back, at least not in Dollars with anywhere near the same value.

The current National Debt stands at over $18 Trillion, and with annual deficits resuming their previous $1+ Trillion, some projections are that the National Debt will double within 10 years. If the current levels are not sustainable, why would any sane person expect that a $36 Trillion National Debt could be reached without a collapse of the US Economy?

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Duck Quacks And Golden Echo’s

By Rick Mills – Re-Blogged From http://www.Gold-Eagle.com

The US Dollar, on a slippery slope for years, has reversed and broken out against every major currency and developing economy currency. A global wide quantitative easing (QE) is happening. Almost every central bank (Sweden’s Riksbank became the 14th central bank to ease monetary policy in 2014) is now creating money as fast as they can potentially leading to a global liquidity storm.

A strong dollar helps Americans by making imports cheaper and curbing inflation –  U.S. import prices fell 2.8% in January, are now down 8% yoy and January’s consumer price inflation is expected to be less than 1%.

However a strong US$ hurts U.S. based multinationals who have overseas earnings in those very same currencies that have taken such a severe beating versus the soaring U.S.$.

Over 85% of companies have lowered guidance for 2015 and the S&P 500 looks ready to turn over – despite

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Divestment Ethics and Realities

Guest essay by Paul Driessen – Re-Blogged From http://www.WattsUpWithThat.com

College students who support divestment of fossil fuel stocks are passionate about their cause. Just look at their word choices. Though they could never function even one week without hydrocarbon energy, they call fossil-fuel companies “rogue entities,” assert that oil, coal and natural gas interests have the “political process in shackles,” and believe most of the world’s known fossil fuel resources must “stay in the ground” to avoid “catastrophic global warming.” It’s a shortsighted view of energy ethics and corruption.

Their over-heated hysteria over climate change is fanned by groups like 350.org and college professors who rehash doom-and-gloom forecasts about rising seas, dying species and other cataclysms that they insist can be remedied only by terminating fossil fuel use and investments in fossil fuel companies.

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Weekly Climate and Energy News Roundup #168

The Week That Was:February 14, 2015 Brought to You by SEPP (www.SEPP.org) The Science and Environmental Policy Project

THIS WEEK: By Ken Haapala, President, Science and Environmental Policy Project (SEPP)

US National Security – Threat of Climate Change: The Obama Administration continues to insist that global warming/climate change is a threat to US National Security. Such a claim can be used to expand the powers of the presidency. The President has already ordered that government agencies consider what the government states are the impacts of climate change in funding major government-funded improvements, particularly rising sea levels, into account on federally funded projects, such as military installations, roads, hospitals, etc. The underlining assumption in all this is that human-caused carbon dioxide (CO2) emissions are the principal cause of global warming, also called climate change, climate disruption, climate chaos, or whatever is fashionable at the moment. In a television broadcast, Susan Rice, the US National Security Advisor, declared climate change is an existential threat. Perhaps, she assumed it was human caused. But, those who re-call existential literature may remember it to be vague and confused.

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Minimum Wage Madness

cropped-bob-shapiro.jpg   By Bob Shapiro

During the 1st third of the 20th century, the Minimum Wage was held to be Unconstitutional, since it violated the Due Process guarantee under the 14th Amendment. In 1937, during the Roosevelt Administration, the Supreme Court overturned their earlier, long-standing ruling, and the Minimum Wage was declared to be Constitutional.

An important consideration is that, in February 1937, FDR had legislation introduced which would “pack” the Supreme Court – potentially increasing the voting number to 15 Justices. FDR supported the Minimum Wage, and his attacks on the then current makeup of the high court likely influenced members’ votes.

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The Most Common Error in Economic Debates

By Keith Weiner – Re-Blogged From http://www.keithweinereconomics.com

Have you ever been in an argument about whether we should raise taxes and then someone tosses out a real whopper? “The top tax rate for decades after World War II was over 90% and look how the economy boomed!”

Or perhaps you read a Paul Krugman column where he said that, “there’s a big problem with the claim that monetary policy has been too loose: where’s the inflation [he means rising prices]?”

Both the Internet troll and Professor Krugman are making the same mistake. Let me explain.

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The End of Central Banking

By Philip Barton – Re-Blogged From http://www.goldstandardinstitute.net

Central banks are in trouble. The belief that a committee of academics can manage an economy is wilting as more and more question their role. The trillion euro quantitative easing and absurdly low and falling interest rates smack of desperate times and desperation.The vast injection of make-believe money will act as a great boost to the make-believe economy noted in official statistics.

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Civil Forfeiture for Labor Regulations

By Walter Olson – Re-Blogged From http://www.Reason.com

One reason for the public outcry over civil forfeiture is its unfairness as a matter of procedure: at a point when you’ve been convicted of nothing, law enforcement can seize your property and make you sue to get it back. And then if you want to challenge the government’s actions, the assets you need for a legal defense may themselves have been seized or frozen. So the pressure is to settle with prosecutors or police on unfavorable terms, perhaps getting back some of your bank account or of the value of your home or car but often without a practical chance to fight the case against you in court.

It isn’t just forfeiture law that can give the government this intimidating type of power. Under a provision of the 1938 Fair Labor Standards Act, the U.S. Department of Labor can seek what is known as a “hot goods” order, freezing the physical output of an employer that it suspects of having violated wage and hour law, all without having to prove its case at a trial.

In recent years — urged by such constituencies as labor unions, trial lawyers, and left-leaning academics — the Obama administration has greatly stepped up its enforcement of FLSA wage-hour law. Part of that enforcement has taken the form of a revitalized use of hot-goods orders, which even defenders of its approach concede had until recently been little-known. So far the most notable result has been a federal attack on blueberry growers in the Pacific Northwest — an onslaught high-handed enough to have been met with a stinging rebuke from a federal court last year, and which has now ended in humiliation with the dropping of charges against two growers and a refund of moneys extracted from them.

The case started in 2012 when the Labor Department told three Oregon farms it didn’t think the piecework rate system they used, which paid workers for pounds picked, resulted in high enough pay for field workers. Without spelling out exactly how it had arrived at this conclusion — an omission that would raise questions later — it obtained a hot-goods order against them, labeling an estimated $5 million worth of fresh blueberries as contraband forbidden to enter the channels of commerce for supermarket sale, processing, or any other use. And then it offered the growers a deal: if they wanted Washington to release their crop, they would have to not only fork over a demanded cash settlement but — this is the kicker — agree not to appeal.

It’s coercive enough to deploy the hot-goods power against a maker of steel ingots or knitted garments. But blueberries are a highly perishable crop that begins to lose value at once if not shipped. Indeed, no one could remember a case until the Obama years in which the hot-goods power had been used against agricultural produce at all, let alone one with a shelf life measured in days.

For the growers, of course, the proffered choice was no choice at all: rather than lose crops worth millions, they took the deal and agreed to pay $240,000. But outrage spread among farm groups, and the Oregon Farm Bureau offered to assist in a court case. The next year two of the growers went to court to challenge what had happened to them and undo the settlement. They told a federal court that the hot-goods order by its nature had prevented them from asserting their legal right to contest the department’s wage calculations or even find out what they were. One grower said the government’s tactics had amounted to “extortion.”

Making matters worse, the growers finally managed to uncover some of the department’s methodology in calculating wage underpayment. Here’s the Bend (Oregon) Bulletin in an editorial last month:

Do you know how the department determined some of the alleged labor violations? It guessed.

It determined that a picker could pick only a certain amount of blueberries in a day. [Since a larger amount had been picked than the number of reported workers would account for, it deduced that the farms must have used off-the-books time or laborers — W.O.] One farm hired a former Labor Department investigator to test that theory. He had workers pick blueberries on a field that had already been picked, and many picked well over that amount.

It’s hard — as in, really, really hard — to get a legal settlement thrown out on grounds of duress. But federal judges nonetheless sided with the growers and ruled that the Department had overstepped its powers. Federal district judge Michael McShane even wrote that the department’s conduct constituted “fraud.” Meanwhile, the U.S. House of Representatives

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Theory and the Global Warming Pause

cropped-bob-shapiro.jpg   By Bob Shapiro

Global temperature is an average of the daily high and the daily low (Tmax & Tmin). If only it were that simple.

There are very few official weather stations on land, and a laughably low coverage for the 3/4 of the earth’s surface covered by water. To make up for this lack of data, climatologists divvy up the earth’s surface into grid boxes (5 degrees X 5 degrees), and “infill” any (A LOT) of the missing data, using readings from stations up to 1200 Km away – that’s like filling in Kansas from a thermometer in Galveston, TX.

Climatologists also do “quality control” on the instrumental data to adjust for station moves or other perceived problems. You would think that all the adjustments pretty much would cancel each other out, but if you think that is what actually happens, then I have a bridge I’d like to sell you. The reality is that older data is adjusted downward while newer data gets adjusted upward – and the same data gets adjusted several times, always in the direction which would make the trend look to be more steeply warming.

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Advances in Research of Electric Car Batteries Presented at AAAS

Electricity, whether through the power grid or through rechargeable battery technology, is NOT a power source. Electricity is a means of power transmission. The actual source has to be something else – fossil fuels, nuclear, hydro, wind, solar, or geothermal.

Each source has merit – and drawbacks – depending on the niche where it is to be used. Improvements in the transmission system, regardless of where the power actually comes from, are a good thing.

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Is Washington Fabricating the Economic Data?

Bureaucrats in the U.S.S.R. kept issuing glowing economic reports right up until the Soviet state collapsed. Of course, many snickered at those reports for years. Widespread poverty and unemployment were obvious and no amount of government bluster obscured that reality. People generally understood that economic reports were little more than another propaganda tool.

Here in the U.S., official data is considered more reliable. Americans have been told the economy is getting better since bottoming in 2009. There is some evidence to support this. In particular, real estate prices have made a big recovery due to cheap credit, and the stock markets are back to making new highs. So when officials tell us things are getting better, we have reason to believe them.

But, investors should be careful before suspending all disbelief. The well-paid bureaucrats in Washington have the same powerful incentives to support their government’s narrative as their peers did in Moscow. Continue reading

Margin Debt and Stock Prices

cropped-bob-shapiro.jpg   By Bob Shapiro

Many investors who buy stocks try to increase their total returns by borrowing money for part of the purchase price. When this borrowing is from a stock brokerage and secured by all the stock in the transaction, this money is referred to as Margin Debt. If the price of the stock goes their way, they make a profit not only on the money they put up but also on the money they borrowed.

Of course, if the price goes against them, their loss is increased – but not by just as much. The stock bought on Margin will make or lose money depending on the price movement, but regardless, they have to pay interest on the loan. Investing on Margin is not for the faint of heart. Still, there is a lot of stock bought on Margin.

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Climate Cartoons By Josh

Cartoons by Josh – Re-Blogged From http://www.WattsUpWithThat.com

Josh writes: Here are the cartoon notes of a riveting talk given by Dr Christopher Essex last Wednesday,11th Feb, in the House of Lords, UK Parliament. Chris is Chairman, Permanent Monitoring Panel on Climate, World Federation of Scientists, and Professor and Associate Chair, Department of Applied Mathematics, University of Western Ontario, Canada. He is also co-author, with Ross McKitrick, of the book Taken by Storm.

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Could Zero/Negative Interest Rates Be The End Of The Fractional Banking System

With negative interest rates deposit holders might opt for paper money (notes) instead of digital money (digital wallet, bank account)! Which could bring down the fractional banking system because as we know of every $100 you deposit in the bank $90 is subsequently loaned on. US Federal Reserve sets a Required Reserve Ratio of 10%, but applies this only to deposits by individuals! Banks have no reserve requirement at all for deposits by companies! Go figure.

Anyway the Required Reserve Ratio of 10% means that only a fraction or $10 of the $100 you have deposited at the bank is available for cash withdrawal. Your $90 that is loaned

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Toward Free Trade in Sugar

By Daniel R. Pearson – Re-Blogged From http://www.cato.org

For decades, political support for the U.S. sugar program has been underpinned by the general sense that the costs of producing sugar in this country are quite high relative to prices prevailing in world markets. Thus, the elimination of government support would lead to the certain death of the sugar industry. Recent analysis indicates that this view simply is not correct. Rather, the U.S. industry would continue to produce sugar economically in the absence of government support.

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Share Buybacks – Good or Bad?

cropped-bob-shapiro.jpg   By Bob Shapiro

Buy Low and Sell High!

Though this is what investors aim for, many (most?) wind up doing just the opposite. Companies buying or selling their own shares are notorious for their awful timing. Rather than indicating merely lousy skill, many times it points to corporate leaders acting in their own, personal interests, even when that is opposite to their fiduciary responsibility of working for the benefit of all shareholders.

When you hear a CEO say that the company is buying back its own shares ‘To release shareholder value,” you may need to dig deeper. After that kind of “handshake,” you may want to count your fingers.

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Weekly Climate and Energy News Roundup #167

By Ken Haapala, President, Science and Environmental Policy Project

The Week That Was: February 7, 2015 www.SEPP.org

US National Security – Threat of Climate Change: The White House has issued a report, “National Security Strategy”, stating that climate change (what used to be global warming before it stopped) is one of the greatest threats to US national security. The report contains choice terms such as “carbon pollution” which implies that the authors do not consider that their breathing is polluting, emitting carbon dioxide (CO2) concentrations 100 times that of the air they inhale.

 

The section “Confront Climate Changestates: “Climate change is an urgent and growing threat to our national security, contributing to increased natural disasters, refugee flows, and conflicts over basic resources like food and water. The present day effects of climate change are being felt from the Arctic to the Midwest. Increased sea levels and storm surges threaten coastal regions, infrastructure, and property. In turn, the global economy suffers, compounding the growing costs of preparing and restoring infrastructure.”

As presented below, and in prior TWTWs, there are NO growing threats of storm intensity to the US or globally. Sea level rise appears to be in line with the past century, [local conditions are most important], the accumulated cyclone energy (ACE), is not increasing, temperatures have plateaued, in general the globe is greening, except for conflicts created for ideological reasons there are few areas of famine, the decline in Arctic ice has reversed, and even the White House report recognizes that the US is becoming more self-sufficient in production of oil and natural gas, even though the Administration has denied access for increased production in Federal lands and waters. In short, the Administration’s campaign against climate change is out-of-touch reality.

For example, the section “Advance Our Energy Security” opens with the statement: “The United States is now the world leader in oil and gas production.” What has this administration done to create the US as the world leader – deny offshore drilling, deny Arctic drilling, deny hydraulic fracturing on federal lands and waters? The great increase in production of oil and gas is occurring on private and state-owned lands. This increase in production has led to a dramatic drop in world price of oil – a benefit to most American citizens and the world in general. The claim of “peak oil” in the foreseeable future is an idea of the past.

Almost amusingly, the report states: “Seismic shifts in supply and demand are underway across the globe.”… “Increasing global access to reliable and affordable energy is one of the most powerful ways to support social and economic development and to help build new markets for U.S. technology and investment.” Yet, the Administration continues to restrict the flow of oil to global markets, as can be seen in its refusal to approve the Keystone XL pipeline after six years of study.

According to newspaper- reports: Energy Secretary Ernest Moniz underscored the importance of energy security in his own statement on the plan.

 

“Now more than ever, it is critical for us to focus our efforts to cooperate on security issues that are increasingly critical to the stability of global markets and underscore the risk of relying on one source of energy,” he said.

 

“At the same time, collective action on security also presents an opportunity to diversify our low-carbon energy options, combat climate change, and strengthen our economies.” Apparently, Energy Secretary Moniz is unaware of the tremendous benefits to the US of low cost fossil fuels and the hardships that unreliable solar and wind are placing on the public and industries in Europe.

Unfortunately, the White House report gives an insight on how this ambitious administration will use whatever means it has available to expand control of the economy and energy use. The report states: More than 100 countries have also joined with us to reduce greenhouse gases under the Montreal Protocol—the same agreement the world used successfully to phase out ozone-depleting chemicals. The Montreal Protocol is being misused on the now questionable claim that hydrofluorocarbons (HFCs) were depleting the stratospheric ozone layer, although little effect was being measured on the surface. Now, the administration is manipulating the meaning and intent of the Protocol to cover greenhouse gases, particularly methane and CO2.

The Administration’s actions illustrate why the US should be wary of international agreements. Once approved by the Senate, an ambitious administration can manipulate international agreements for its own purposes. The administration’s actions have been a quiet endeavor, with little publicity. But, the effects on US energy and prosperity can be severe and long-lasting.

See links under Defending the Orthodoxy, EPA and other Regulators on the March and, for ACE, http://models.weatherbell.com/tropical.php

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Quote of the Week: If I had an hour to solve a problem, I’d spend 55 minutes thinking about the problem and 5 minutes thinking about solutions.” – Albert Einstein [H/t High Frontier]

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Number of the Week: 12.9% and 10.6%

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Natural Catastrophes – Losses: The December 20, 2014 TWTW linked to a preliminary report by Swiss Re, the world’s second largest re-insurer (those companies that take on insurance risks by other companies). The report stated that in 2014 global disaster events cost insurers USD 34 billion, below recent annual averages. It also stated a total loss of life of 11,000 from natural catastrophe and man-made disaster events in 2014 was down from the more than 27 000 fatalities in 2013. It should be remembered that natural disasters include earthquakes, tidal waves, etc. as well as extreme weather events.

The report of the world’s largest re-insurer, Munich Re is out, Review of natural catastrophes in 2014: Lower losses from weather extremes and earthquakes. This report states that more than nine out of ten (92%) of the loss-related natural catastrophes were due to weather events. “A striking feature was the unusually quiet hurricane season in the North Atlantic, where only eight strong – and thus named – storms formed; the long-term average (1950–2013) is around 11. In contrast, the tropical cyclone season in the eastern Pacific was characterized by an exceptionally large number of storms, most of which did not make landfall.”

The first and the fourth most expensive losses were winter damage, not heat or storm related. Japan was most hit by winter damage, which took 37 lives. Winter damage in the US and Canada ranked fourth in losses. Flooding in Asia took the most lives. Flooding has always been a major problem in Asia, and the rate of loss of lives is declining, not increasing.

Also, Roger Pielke posted a report on “The Precipitous Decline in US Flood Damage as a Percentage of GDP” Pielke states: The US is prone to very large flood events, resulting in tens of billions of dollars in losses. However, the trend since 1940 is striking. As the nation has seen its economic activity expand by a factor of almost 13, flood losses as a proportion of that activity have dropped by about 75%.

 

Please don’t use this data to say anything about the incidence of flooding in the US or changes in climate. For that, I urge you to look at data and research, discussed here. You’ll find very little evidence of increasing flood frequency or magnitude either in the US or globally. Regardless, the diminishing economic impact of floods in the US is undeniable.

It is becoming evident that the authors of the US “National Security Strategy” failed to consult with companies whose business it is to understand losses from extreme weather events or US academics who study these issues. See links under Changing Weather and

http://www.swissre.com/media/news_releases/Preliminary_sigma_estimates_global_disaster_events_cost_insurers_USD_34_billion_in_2014.html

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Health: The EPA is heavily publicizing its anti-coal campaign on the grounds of public health, particularly fear of asthma. According to reports, early in this administration, officials at EPA decided that fear of respiratory diseases will be an excellent way to convince many in the public that action was needed to reduce coal-fired power plants. Asthma was a great fit. It was a disease often contracted in childhood and the incidence of the disease was increasing. The cause was unknown. It was assumed that the cause was outdoor air pollution in urban areas. Namely, in poorer neighborhoods where coal-fired power plants were located. The EPA built its anti-coal and the anti-ozone campaigns on this assumption. However, empirical science may get in the way.

A problem has developed in this great plan. A study published in the Journal of Asthma and Clinical Immunology found little or no relationship in incidence of asthma between children in urban areas and children in rural area, after adjustments for other factors such as poverty. The study emphasizes that air pollution may be a cause for asthma, only it’s indoor air pollution, such as second hand smoke, rodents, mold, etc. According to The Hill newspaper: The study couldn’t come at a worse time for the agency. EPA is preparing to tighten national standards for ground-level ozone (the main ingredient in smog) by as much as 20 percent. To justify the move, EPA Administrator Gina McCarthy argued she was “following science” to “protect those most at-risk—our children, our elderly, and people already suffering from lung diseases like asthma.”

But it’s hard to see how lowering the current ozone limit either “follows the science” or “protects those most at-risk” for asthma.

No doubt, the environmental industry will condemn the study, to include claims of coal industry funding, etc. But, the problem of asthma cannot be solved by condemning the research of others on the dubious basis of funding. If asthma is a pressing national issue, then it must be approached with scrupulous examination, not personal attacks. See links under Health, Energy, and Climate.

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The Race to the Bottom — Circular Reasoning? As explained in last week’s TWTW, surveys (opinion polls) frequently disguise the scientific issues regarding global warming/climate change. The issue is not what climate scientists think, but how and why they think it — what physical evidence do they use to justify their claims? General climate models, which have not been validated, are not physical evidence. For example, given the best surface temperature records available, there were two periods of general warming during the 20th century; one from about 1910 to 1940 and the second from about 1976 to 1998. There has not been a generalized warming of the globe as one would expect from increasing atmospheric carbon dioxide. Surveys of scientists that fail to make these points as central issues are generally meaningless.

Many of those who create global climate models also ignore these points and are now trying to justify the failure of the models to predict the current plateau in global temperatures with ever imaginative explanations. Researchers at the Max Planck Institute used climate model simulations in 15 year periods to claim that the climate models are correct, except for natural variations (??). They concluded that there are no systematic errors in the models. To make matters worse the claim was summarized in Phys Org as:

Sceptics who still doubt anthropogenic climate change have now been stripped of one of their last-ditch arguments: It is true that there has been a warming hiatus and that the surface of the earth has warmed up much less rapidly since the turn of the millennium than all the relevant climate models had predicted. However, the gap between the calculated and measured warming is not due to systematic errors of the models, as the sceptics had suspected, but because there are always random fluctuations in the Earth’s climate. [emphasis added, from Matt Briggs]

Who claimed that there were no fluctuations in the Earth’s climate? Certainty, not most of the skeptics who have repeatedly pointed out that climate has been changing for hundreds of millions of years, long before humanity existed.

When analyzing the paper further, Nicholas Lewis (technical) and Andrew Montford (general) recognized the entire effort was another example of circular reasoning – an effort based on model outputs to verify models rather than rigorously comparing model output with physical observations of temperatures.

This affair exposes the poor quality of climate research being conducted and published by the UN Intergovernmental Panel on Climate Change (IPCC), and its following among government entities. Some have argued that under the UN Framework Convention on Climate Change (UNFCCC), it is not the function of the IPCC to understand natural variation in climate change, but only the human influence. If so, then every report, every press release should boldly state that the report is addressing the issue of human cause of climate change and does not address the natural causes that have been on-going for hundreds of millions of years. Such a statement would help clarify the confusion in the public that

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Calling a Spade a Spade

By Bill Holter – Re-Blogged From http://www.Gold-Eagle.com

Yesterday we looked at the situations in both Ukraine and Greece, and how they are both out of money which makes them potential “flash points” for reality to set in. What I’d like to talk about today are the various “slights of hand” and why a spade can never be called a spade.

Currently in the U.S., some (but certainly not all) of the recent economic numbers are showing an absolutely booming economy.  All you need to do is look at Friday’s unemployment numbers, they were clearly bogus.

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Countdown To “Grexit”

By Andrew Hoffman – Re-Blogged From http://www.Silver-Phoenix500.com

After declining for an incredible 47 of the past 51 days, the Baltic Dry Index has officially breached its all-time low of 554 – set in 1986, 29 years ago. Sure, propagandists will try to blame tanker “oversupply” rather than plunging end user demand – just as they blame the catastrophic oil price plunge on “oversupply” of high cost oil, rather than said “under-demand.” However, the fact remains that both the Baltic Dry Index and oil price are freefalling – in both cases, catalyzing massive corporate and investment losses; layoffs; and defaults.

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China Just Crossed A Landmark Threshold

By Frank Holmes – Re-Blogged From http://www.silver-phoenix500.com

Back in July 2013, the think tank Heritage Foundation predicted that China’s outbound investment “could very well exceed $80 billion [by the end of the year] and is on course to breach $100 billion by about 2016.”

With all due respect to the Heritage Foundation, China just beat the forecast by a couple of years, exceeding the $100 billion mark at the end of 2014. For the first time, in fact, China invested more capital outside its own borders than it did inside. As legendary Major League Baseball player and coach Yogi Berra once quipped: “It’s tough to make predictions, especially about the future.”

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Fiddling With Temperature Data is the Biggest Science Scandal Ever

By Christopher Booker – Re-Blogged From The Telegraph http://www.telegraph.co.uk

New data shows that the “vanishing” of polar ice is not the result of runaway global warming

When future generations look back on the global-warming scare of the past 30 years, nothing will shock them more than the extent to which the official temperature records – on which the entire panic ultimately rested – were systematically “adjusted” to show the Earth as having warmed much more than the actual data justified.

Two weeks ago, under the headline “How we are being tricked by flawed data on global warming”, I wrote about Paul Homewood, who, on his Notalotofpeopleknowthat blog, had checked the published temperature graphs for three weather stations in Paraguay against the temperatures that had originally been recorded. In each instance, the actual trend of 60 years of data had been dramatically reversed, so that a cooling trend was changed to one that showed a marked warming.

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Fairness and Justice

walter-williams-142x200   By Walter E. Williams

Oxfam reports that the richest 1 percent of people in the world own 48 percent of the world’s wealth. Many claim that we should be alarmed by income inequality because it hampers upward mobility. Others argue that because income is distributed so unevenly, justice and fairness require income redistribution. Let’s look at fairness and justice.

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Taxes vs Subsidies

cropped-bob-shapiro.jpg   By Bob Shapiro

There’s a truism in economics that, if you want more of something you subsidize it, and if you want less of it then you tax it. A quick look at government policy here in the US shows that this is as true today as it ever was.

But, since Americans have been taught to have knee jerk reactions, let’s try just to look as dispassionately as possible, not considering whether any of the policies are “needed desperately,” “are for a good cause,” or some other worthwhile purpose. Let’s just look at what is.

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Putting Uncle Sam on a Diet

By Bob Shapiro

I have written several times that every Dollar that our government spends must come out of the private, productive sector of the US Economy. I have called for Balancing the Budget, setting a Dollar Limit on federal spending, and other measures to reduce government spending. The Heritage Foundation has put together a detailed plan for shrinking our federal government, outlining 106 specific proposals for cutting spending. Though there are some of their recommendations I do not agree with – they want to increase spending for the Department of Defense even though the US spends more than all other countries combined – there is a wealth of good ideas.

Please set aside some time to look at their proposals. I think you’ll be glad you did.

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A Different Greek Debt Plan

cropped-bob-shapiro.jpg   By Bob Shapiro

Over the last decade or so, I have been in contact with the leaders of several countries, offering suggestions on how they can turn around the “difficult” economic situations which their countries were living through. In Greece, I contacted, among others, Syriza Party leader Alexis Tsirpas, several years before his recent election as Prime Minister.

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Seafloor Volcano Pulses May Alter Climate – Models May Be Wrong

Humans aren’t the only source of CO2. Underwater volcanoes and other seabed eruptions, caused by natural celestial cycles may be at fault.

By Anthony Watts – Re-Blogged From http://www.WatsUpWithThat.com

New data show strikingly regular patterns, from weeks to eons

Vast ranges of volcanoes hidden under the oceans are presumed by scientists to be the gentle giants of the planet, oozing lava at slow, steady rates along mid-ocean ridges. But a new study shows that they flare up on strikingly regular cycles, ranging from two weeks to 100,000 years–and, that they erupt almost exclusively during the first six months of each year.

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