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Our June 1, 2007 Newsletter
Edition
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EDITORIAL:
GLOBALIZATION AND CITIZENS WITHOUT BORDERS
.
The
editorial posted in a recent newsletter (Back To The Future) seems to
have struck a chord or touched a nerve, as they say, based upon the
overwhelming letters we have received in the past month. And so,
I guess the conclusion is, there is a large number of you out there
concerned about some of the economic dynamics (and social changes as a
result) underway. However, while there are varying opinions about
these issues (and what to do about it) I do think that change is
inevitable, due to a number of factors, and it probably is more
beneficial (and easier) to understand the changes rather than trying to
fight them or hold onto the status quo. Meaning, every empire,
every society, every economy and every great economic or military power
has gone through natural lifecycles of growth and decline. The
key is to understand what is going on and why, while or during such
things are taking place, so you can recognize and take advantage at the
same time (or protect yourself as the case may be). In other
words, the goal should be to get an understanding, and such information
is of course out there to read or review (in the public domain already:
newspapers, magazine articles, books, economic reports, government
statistics, etc.).
.
Let
us start off by discussing some thoughts and ideas involving
globalization, which is probably one of the most important factors that
is reshaping the economic landscape (and as a result, both economic and
military power of certain nations). But to begin with, let me
also clarify that I believe in the free market, capitalism and the idea
of less, not more, government interference into the lives of citizens
and in relation, business as well. Of course, on the same token,
this also means NO corporate welfare either, or the favoring of one
kind of citizenry over another, regardless if we are talking about
economics (be it subsidies to specific groups or companies, etc.),
individual liberties and whatever else (laws or regulations that favor
one over the other). Based on this statement, you may come to the
conclusion that I am perhaps supportive of what might be called the
conservative neo-con point of view. Not true, but rather to point
out that one cannot claim to be in favor of certain ideas or ideals,
but only when there is a one sided benefit to you personally.
Meaning, if you believe in free and fair trade, then you must accept
all results of that, both in the case of when you get a benefit and
also when the other guy does as well. In other words, it is a
two-way street which has no room or place for hypocrisy. Fair and
even means exactly that, all the way around. Of course, on the
other hand, no one said you cannot go global, and take advantage too -
or have they? What is fair and acceptable for corporate citizens
should also apply to other kinds of citizens as well (the living,
breathing kind).
.
On
the other side of the spectrum, we have those people that will say
government can and should do more, both in terms of economic policies,
social or welfare programs, and laws or regulations to influence
economic behavior or activities. There is some merit to that
argument as well, and there are some things government can possibly do,
but again, this too can be taken to the point of unfairness and one
sidedness also, when one group or company or industry is given a pass
while the rest are made to suffer the burden. However, along
these lines and speaking specifically about globalization, there have
been arguments recently that government should place very high tariffs
on foreign made products being imported (in order to protect and
encourage domestic industry) and or perhaps put a higher tax burden in
place on domestic companies in the case when a certain percentage of
their manufacture in done outside of the home country with cheaper
foreign labor. Indeed, in the case of the first idea, this was in
fact what was done during the so-called industrial revolution in the US
and was a policy that allowed domestic US industry to build up during
the late 1800s. In addition, to a large respect, this is what
India and China have done - albeit with cries of unfairness from those
very same countries that used this very policy in the past. In
other words, these so-called undeveloped third world countries are
using the same playbook that the modern , wealthy industrialized
countries had used previously. NAFTA, CAFTA and other such
so-called free trade initiatives are really meant to dismantle these
policies that many of the smaller developing countries have (or had) in
place. The argument is to open up and benefit trade all the way
around. The truth of the matter is, the result has been permanent
job losses in the wealthy industrialized country AND reduced government
tax revenues in the developing nation (because they are no longer
collecting import duties, not to mention the attack on domestic
industry inside the developing nation in terms of unfettered foreign
competition). In reality, a bad deal for both nations
involved. Of course, it is also fair to highlight that China
especially has liberalized it laws and regulations regarding foreign
investment and foreign ownership of companies inside the country within
the last few years (due to pressures mainly from the US). So, the
irony is that China, at the moment, is possibly one of the most non
restrictive trading nations on the planet, but only very recently (and
maybe not to the extent some would like). India much less so, but
the difference is that China is a story about manufacturing, whereas
India is a success story regarding service or white collar types of
industries (computer programming, call centers, book editing, and so
on) and not manufacturing.
.
Mr.
Ralph Gomory, a former senior vice-president at IBM, co-authored a book
titled: Global Trade and Conflicting National Interests, whereby he
highlights the destructive impact of globalization on American
prosperity. For example, he says that huge losses are ahead--10
million jobs or more (for the US). Referencing the book, William
Greider writes: At IBM back in the 1980s, Gomory watched in awe as
Japan and other Asian nations captured high-tech industrial sectors in
which US companies held commanding advantage. IBM invented the disk
drive, then dropped out of the disk-drive business, unable to compete
profitably. Gomory marveled at Singapore, a tiny city-state, as it
lured American manufacturers with low-wage labor, capital subsidies and
tax breaks. The US companies turned Singapore into a global center for
semiconductor production. It was an unforgettable transformation,
Gomory remembers. And it was pretty frightening. The offer that
many Asian countries will give to American companies is essentially
this: Come over here and enhance our GDP. If you are here our
people will be building disk drives, for example, instead of something
less productive. In return, we'll help you with the investment, with
taxes, maybe even with wages. We'll make sure you make a profit. This
works for both sides: the American company gets profits, the host
country gets GDP (economic growth). However, there is another effect
beyond the benefits for those two parties--high-value-added jobs LEAVE
the U.S. China and India, he observes, are now doing this on a
large scale. Microsoft and Google opened rival research centers in
Beijing. Intel announced a new, $2.5 billion semiconductor plant that
will make it one of China's largest foreign investors. China's
industrial transformation is no longer about making shirts and shoes,
as some free-trade cheerleaders still seem to believe. It is about
capturing the most advanced processes and products. The
multinationals' overseas deployment of capital and technology, Gomory
explains, is the core of how some very poor developing nations are able
to ratchet up their technological prowess, take over advanced
industrial sectors and rapidly expand their share in global trade--all
with the help of US companies and finance, as they roam the world in
search of better returns. This overseas investment decision may
then prove to be very good for that multinational firm. But there
remains the question: Is the decision good for its own (home)
country? If the firm is locating low-skilled industrial
production in a very poor country, Americans get cheaper goods, trade
expands for both sides and the result is mutual gain. But the trading
partners enter a zone of conflict if the poor nation develops greater
capabilities and assumes the production of more advanced goods. Then,
the authors explain, the newly developing partner becomes harmful
to the more industrialized country. The firm's self-interested
success can constitute an actual loss of national income for the
company's home country. American multinationals, as principal
actors in this transfer of wealth-generating productive capacity, are
distinctively free to make the decisions for themselves without
interference from government. They want profit and FUTURE consumer
MARKETS. Their home country wants to maintain a highly productive
high-wage economy. Without recognizing it, the two are pulling in
opposite directions-the divergence of interests most US politicians
ignore, evidently believing church doctrine over visible reality.
.
Source:
http://www.thenation.com/doc/20070430/greider
.
The
very important point is to understand is why so many US based
multinational companies are hot and heavy to jump on the globalization
- free trade agreement bandwagon. Many people only focus on or
understand one side of it, which is outsourcing or the idea of moving
the manufacturing from the high wage first world nation to a low wage
third world (or emerging market) nation, with the point being to get
the best return on investment (new factories) or labor costs. We
all know for example, that the jobs in the United States have gone to
China, India, and who knows where else (I recently bought an American
name brand T-Shirt - made in Turkmenistan, or so said the label).
This is not new news for any of you, and part of the reason for the
free trade agreements are so these manufactured goods can possibly come
back into the US duty-free for these US companies manufacturing
elsewhere. But that is NOT THE ENTIRE STORY. As you will
read via a recent news item mentioned below, the real point is to
export or gain access to those other countries, duty free, whereby the
middle class is growing, whereby consumers still have money to spend
(and are not tapped out with home equity loans or credit card
borrowing), whereby these other economies are growing at double digits
AND whereby the governments in such nations are NOT going broke.
As an example, the all American tractor - heavy equipment company,
Caterpillar, says that they expect US sales to DROP by 11 percent in
2007, BUT that sales to Europe, Asia and the Middle East to increase by
almost 20 percent. Of course, too bad many of Caterpillars
products are NOT made in America anymore (which is an example that
crystallizes this problem). In any event, the point is, not to
complain about business decisions to move a factory abroad (because
there is nothing really you or I can do about it), BUT rather to be
aware of the effects (and opportunities for yourself as well).
And if they can outsource, you can outsource. If there are
opportunities for them, there are opportunities for you. If the
money and better economy is elsewhere - then why not buy yourself an
airplane ticket? In other words, it seems to be the case that you
must look to your own future and welfare, as the politicians certainly
are not.
.
One
important area already impacted is tax revenues for the so-called
wealthy, industrialized nations who are now facing enormous deficits
and budget gaps in terms of increasing costs for social welfare
programs at a time when income is falling (one might also say, they are
surely going broke). Which is to explain, the politicians have
sold out to corporate lobbyists pushing for such free trade agendas and
lower tax rates for domestic corporations (in the US, corporations pay
less than 12 percent of the income based taxes, whereas private
citizens now make up 50 percent), while in effect, turning to the
average middle class citizen now to fill in the gap with HIGHER tax burdens in one form or
another (while also cutting back on social welfare services, other
government services such as police, and on areas such as education
funding as well). This is the tangled web that has been woven and
unless you learn to be international, expatriated and mobile, you may
be caught in the spiders spindles. This is one very important
issue to be aware of for you directly.
.
Why
has this happened and what are many middle class people doing about
it? Well, to start off with, we should ask who pays for the
overwhelming majority of political campaigns these days in the
US? If you answered corporations and affiliated soft money from
lobbying groups and inter-related think tanks - you are correct.
Meaning, I tend to believe the mindset was that even though corporate
citizens were blatantly given all sorts of reductions in tax rates and
in some cases, outright taxpayer funded welfare in exchange for
campaign funding support (some call it lobbying and campaign
contributions, and others call is graft or corruption), that the
average Joe would never see it coming, and if he did, he could do
nothing about it anyway. Am I suggesting any sort of concerted
conspiracy theory? No, not by a long shot, and it is difficult to
call something a conspiracy when it is done very publicly in plain
sight. But, I do think that one of two things are possible.
Either many of the politicians are incredibly stupid (in which case
they probably should not be in control of the peoples money and the
government) OR they are incredibly intelligent and conniving in the way
they attempt to deceive the public knowing full well what the outcome
will be (which may be far worse than if they were just plain stupid).
.
Regardless,
what we are now seeing is a growing impetus to go after the middle
class and non-corporate kinds of citizens to make up the economic
shortfall that resulted in this policy towards corporate America.
Thus we now have the ranting and ravings of US politicians recently
about tax havens, the complaints in Canada about dual-citizens
free-riding off what is supposedly tax-free citizenship for many dual
nationals living outside of Canada, the continued focus on monitoring
(and stopping) money transfers which also include credit card
processing issues, reduced civil liberties and so on. Naturally,
many of these things are being sold to the public as necessary
safeguards to stop the drug dealing, pornographers, radical militants,
money launderers, and other assorted lunatics meant to harm society in
one way or another - rather than as declaring this a way to stop the
leakage of wealth from the so-called first world or wealthy
industrialized nations to elsewhere. Of course, many of these
initiatives, especially the banking, tax and confiscation related
issues (confiscation of your property when somehow present during a
crime) has been around for a while. Is there any reduction in
drugs, criminal activities, social malcontents and overall bad guys in
the world - now some twenty or thirty years later? I will let you
answer that one for yourself, but I encourage you not to forget your
history and simply - do think about
it.
.
What
is the problem for the politicians? The problem is that many
people have already figured it out. And what do you do once the
cat is out of the bag? Modern telecommunications and the Internet
for sure, has allowed many people to have access to a plethora of
information fairly cheaply and quickly about living in other countries,
offshore banking, tax havens and so on (you will make a mental note of
a previous news article we gave you in a past newsletter, talking about
the US government plan for a new and improved internet, one whereby
they have more control over tracking of information, so-called
acceptable web content and other related items). The final point
being that the average Joe is not stuck in his little corner of the
world anymore, naive and afraid, confused by all the marvelous tales of
foreign bogeymen or how Citicorp laying off thousands of US jobs and
moving them to another country is a actually a very good thing for him
and his family. He now has access to information that clears away
some of the cobwebs, so to speak. As a result, the average
citizen, is no longer being forced to accept whatever skullduggery
comes his way - And why should he? According to William Grieder
(see article link below) - If nothing changes in how globalization
currently works, Americans will be increasingly exposed to DOWNWARD PRESSURE ON
INCOMES AND LIVING STANDARDS. America, he explains,
becomes increasingly dependent, buying from abroad more and more of
what its citizens consume and producing relatively less at home. US
incomes stagnate as the high-wage jobs disappear and US exports become
a smaller share of the world total. So, the question is:
Who in their right mind wants to sit around and wait for that?
That honest answer is, no one, and you do not have to. Which is
to say, the average Joe now realizes he can pack up and move himself
(just like the multinational corporations), his family, his small
business or whatever - to someplace less expensive, less taxing and
dare I say - more free. Is it really possible that you can live
in the country with the least costly living expenses or real estate
costs, bank and earn interest in another country offering tax-free
banking and good interest rates, operate your business out of yet
another, for whatever benefits or reasons?
.
Yes,
it is very possible, but this means that you have become a citizen
without borders, and must get your mind in tune with that idea.
This means getting used to the idea that a passport is only a piece of
paper (or whatever materials they use for the darn thing) that can be
exchanged for another - should you wish. And if governments can
take away your citizenship (due to the fact you were not a good
citizen, or whatever that might entail) then is it not true that you
can renounce your citizenship as well (when a government reneges on its
social contract or commitment to you)? Did you not know it is a
two way street? Citizenship therefore does not define you as a
person, nor confine you (you are not the chattel property of anyone, or
any government for that matter) or limit you as to where you want to
live and also the kind of lifestyle you wish to have (and under what
kind of government you wish to live as well). And as such, a
citizen without borders also ties into this idea of multinational
companies without borders as well. Who taught the individual
citizens they could live this way? Why, the multinational
companies of course, and they have done so all with seemingly tacit
political blessings and approval of government officials. And if
politicians say it is good for the goose (corporations), it certainly
must be good for the gander (you, the individual citizen). Now of
course, the genie is out of the bottle, for everyone, and not just
some. Rub the lamp and decide where you want to go.
.
If
you have a further interest, I highly encourage you to read the fairly
recent (and I will also say excellent) article by William Greider in
its entirety: The Establishment
Rethinks Globalization.
.
http://www.thenation.com/doc/20070430/greider
.
.
IN
THE NEWS:
.
10
QUESTIONS: WHO'S PAYING FOR THE WAR?
By
Katie Couric - May 17, 2007
.
Robert
Hormats, an international finance expert at Goldman Sachs and former
presidential adviser, has written a new book on how America pays for
its wars and he is the subject of this weeks 10 Questions.
.
Katie Couric Asks: Can America
afford its entitlements programs, Iraq, the war on terror, and to fund
its social and economic priorities for the foreseeable future?
.
Robert Mormats Responds: NO.
Reform of entitlements is needed because on their current trajectories
they are not fiscally sustainable. This needs to be done in a way that
endures that those who needs such benefits receive them, but that those
in upper income groups who can pay more into such programs or don't
need the full array of benefits do not get them.
.
http://www.cbsnews.com/blogs/2007/05/17/couricandco/entry2823508.shtml
.
EDITORS NOTES:
That was just one question out of the ten, and you can read the rest
via the link above. However, here is my reason for selecting this
one question alone: IS this guy saying what I think he is
saying? That even though you paid into Social Security your
entire life, and just because you were smart enough to manage your
personal finances well, and maybe even set up other additional private
retirement savings (annuities, IRA accounts) so you would not be broke
at retirement - that you will NOT get the government check when you are
ready to retire? Is that the deal these guys are planning behind
closed doors? So, tell me why is it we are paying in then?
(I forgot, remind me). Are they really that broke, and when are
they planning on saying so in order to warn you about what is
coming?
.
According
to Mr. David M. Walker, Comptroller General of the United States, in
testimony to Congress regarding the FISCAL
YEAR 2006 U.S. GOVERNMENT FINANCIAL STATEMENTS (see the
transcript posted in the public domain on March 20, 2007), he says the
following:
.
For
the 10th consecutive year, certain material weaknesses in financial
reporting and other limitations on the scope of GAO's work resulted in
conditions that continued to prevent GAO (General Accounting Office)
from being able to provide Congress and the American people an opinion
as to whether the consolidated financial statements of the U.S.
government are fairly stated in conformity with U.S. generally accepted
accounting principles (end of quote). In plain English, the
comptroller general of the United States, now in 2007 (a comptroller or
controller is an official who supervises cash-flows in some
organization. Nowadays, comptrollers are typically public officials who
audit government accounts and sometimes certify expenditures, while
controllers are officers of a private sector corporation who perform
similar functions) says that he CANNOT figure
out if the government politicians and bureaucrats are cooking the
books, or not (and that this has been going on for the last 10 years,
so it is not only an issue involving the Republican political
party). Can you imagine? Sounds like Enron. Then he
goes on to say the following:
.
From
a broad federal financial management perspective, the federal
governments FINANCIAL CONDITION
and FISCAL outlook are WORSE
than many may understand. The U.S. governments total reported
liabilities, net social insurance commitments, and other fiscal
exposures continue to grow and now total over $50 trillion, representing
approximately four times the nations total output (GDP) in fiscal year
2006, up from about $20 trillion, or two times GDP in fiscal
year 2000. The federal government faces large and growing structural
deficits in the future due primarily to known demographic trends and
rising health care costs. These structural deficits which are virtually
certain given the design of our current programs and policies will mean
escalating and ultimately unsustainable federal deficits and debt
levels. Based on various measures and using reasonable assumptions the
federal governments current fiscal policy is unsustainable.
Continuing on this imprudent and unsustainable path will gradually
erode, if not suddenly damage, our economy, our standard of living, and
ultimately our domestic tranquility and national security. One
way to think about it is: if we wanted to put aside today enough to
cover these promises, it would
take about $440,000 per American household, up from $190,000 in
2000. As these numbers indicate, the federal government faces large and
growing structural deficits primarily related to Medicare and other
social insurance commitments (end of quote by Mr. Walker).
.
Interestingly
enough, Mr. Walker says that the US Governments total liabilities is
now, as of December 2006, over US$50 Trillion Dollars. If we add
up the net worth of every single household in the United States (in
2006) that amount comes out to US$53 Trillion Dollars, which gives us a
ratio of liabilities to net worth of 95 percent, or to explain it
another way, the American People have
been personally mortgaged to the tune of 95 percent of their stated
value (and your third grade teacher said you were
worthless? If she only knew what the government thinks you are
worth today). Ladies and Gentlemen, if you abide by the idea that
the government is the people (this is what they say, that the
Government is the People, although I do not recall any individual
citizen giving permission to be personally pawned), or that the
governments liabilities are backed up by the net worth of its citizens,
we can conclude that the United States of America is almost INSOLVENT
(there is not a long way to go from 53 to 50) and as a direct result,
its citizens along with it. So, to understand why the tremendous
pressures all of a sudden on the middle class taxpayer (by the
politicians, in terms of complaints regarding tax havens and so on),
you should be aware that about 50
percent of the governments income or revenues NOW come from
Personal Income Taxes and another 32 percent from Social Security
Payments, or a total of 82 percent between the two (2008
Estimate). Which is to explain, the overwhelming predominance of
US Government cash flow or income - comes from individual tax payers
such as yourself (although we should point out that some of the money
going into Social Security is paid in by employers as well, but
regardless, one can estimate or surmise that well over 65 or 70 percent is coming
from the individual if we include the tax burden for Social Security
paid by individuals as added on top of direct income taxes).
Only 12 percent
of the US Governments income or revenue comes from Corporate Income Taxes (2008
Estimate). So, if you need more money, who do you
chase? The guy that already gotten himself out almost lock, stock
and barrel (the corporations that have moved perhaps almost all of the
manufacturing and new investment abroad) or the guy still hanging
around with assets to grab? And by the way, I am not upset with
any company that has done this. God speed and good for
them. What I do take issue with is the idea that other kinds of
citizens, non-corporate citizens (you), should be treated any
differently. This is the true problem, and danger remaining for
the average citizen left behind - or so it would seem.
.
AND HERE IS ONE FINAL COMMENT on
this particular matter directly: Just because the government is
going broke, it does not mean that you have to go broke also.
It's NOT your fault. This leads us to the discussion of
citizenship, and what are the social or political contracts that exist
between citizen and government. What happens when the citizen
continues to fill his or her end of the bargain (continues to live
peacefully, obeying the laws and regulations, and continues to pay
taxes as theoretically agreed under the unwritten compact) BUT the
government reneges in one way or another, or decides to change the
terms of the contract in mid-stream? What if the politicians say:
Give us seventy percent of what you earn and we will take care of you
via various social welfare programs, and then all of a sudden, proclaim
they cannot do so? Then what? What if the politicians
actually made such a mess themselves, or in the least, aid and abet the
financial situation that lead to such a circumstance? IT would
seem grossly unfair to argue that the personal wealth and assets of the
private citizen should be confiscated or mortgaged to pay for the folly
and foolishness of some bureaucrat thousands of miles away. And
yet this is indeed what would seemingly be suggested as your so-called
civic responsibility. Why not let the politicians turn over their
own personal assets to pay down the debt? They made the mess, let
them clean it up. And what would you say or how would you feel if
someone put you down as a personal guarantor or signed over your
personal wealth as collateral without your knowledge or express
permission? What if that same person came back to you and said:
Sorry old boy, but the creditors are coming to take your home and your
bank account because I lost it all (and as a result, your family
suffers, you loose your home and in effect, you are broke). Just
think about it, as real estate taxes keep increasing and talk about
changing the social benefits abounds as well.
.
See:
http://home.att.net/~rdavis2/recsrc.html
.
Also:
GAO analysis of data from the Department of the Treasury, Federal
Reserve Board, U.S. Census Bureau, and Bureau of Economic Analysis.
.
The
full and formal title of the Social Security program as it is applied
directly to retirement benefits, is Old Age Insurance. An
interesting term - Insurance. Can you imagine paying into a
automobile insurance policy for twenty years, only to be told by the
insurance company when it came time for you to put in a claim for a
fender bender, that the claim is going to de denied because the
insurance company thinks you have enough money to fix it on your
own? If that is the definition of insurance, I personally could
do without it. What troubles me is - when exactly are they
planning on dropping this boom on the public? I mean, this guy
interviewed in the above news article is supposedly a Wall Street
insider (from a firm with senior level political ties) and we are told
was a former Presidential advisor as well, so I have to imagine that
this has already been discussed at senior levels of the government
already. And then I start to wonder, how all these things come
together or begin to click. As I already have mentioned - IS all
this integrated with the impetus to stop money movements by private
citizens to countries that supposedly do not cooperate on tax reporting
matters (if you recall, aside from the normal tax haven countries, tiny
Costa Rica was singled out and put on the list as well)? In
addition, we gave you a news story in the past about the CEO of a major
US oil industry company moving himself, his family and the corporate
headquarters to Dubai (which has no income tax, by the way), all
supposedly because he says he wants to be closer to his customers and
where the oil is. Wasn't the oil always there, and have they not
been doing business in the middle east for 50 years already? In
any event, are all these seemingly unconnected issues providing a
pattern that emerges once you connect the dots? All hypothetical
questions to be sure, but not exactly unrealistic or invalid ones to
ask.
.
.
DEBT:
AN INESCAPABLE CONCEPT
By
Gary North - May 17, 2007
.
Debt
is an inescapable concept. It is never a question of debt or no debt.
It is always a question of which kind of debt, owed to whom,
when. In theory, civil governments do not need to issue debt. Yet
they do, century after century. In the history of the United States,
the national government was debt-free only in 1835, in the midst of an
economic boom during the second term of the presidency of Andrew
Jackson, who had campaigned on a platform of reducing government debt.
He fulfilled his promise. He even went beyond his promise. He also
refused to re-charter the Second Bank of the United States, which lost
its monopolistic Federal charter in 1836. It went bankrupt five years
later, unable to compete in a free market. Governments in the
West have been going heavily into debt ever since the fifteenth
century, beginning with the Italian city-states. They have worked hand
in hand with government-licensed fractional reserve banks, which then
buy the debt instruments of the governments. Eventually, all of the
governments of the Italian city-states defaulted, taking down the banks
with them. Governments see that they can gain political support
from the rich when they owe great sums of money to the rich. The rich
in turn regard governments as solvent borrowers because governments
possess the power to tax. Investors assume that governments will not
default because governments do not have to face a competitive market.
Investors believe that the power to tax is more reliable than market
competition. They buy government bonds in preference to corporate
bonds. This assumption holds good for most periods. But when it
does not hold good, investors lose everything. In times of war,
governments build up debt. In times of peace, they are supposed to
reduce the level of debt. But in the twentieth century, governments did
not reduce debt in peacetime, while accelerating it in wartime. The modern world is a world built on
government debt. Government debt is the economic foundation for the
central banks of the world. Government debt in the coffers of
central banks establishes the legal reserves for fractional reserve
commercial banks. When debt becomes
the legal basis of money, there can be no reduction of debt without
universal bankruptcy: massive deflation. No government is
willing to accept this outcome. This is the great curse of modern
banking.
.
A
man's word is his bond. This is an ancient and once-familiar
slogan in the United States. A bond is a relationship initiated by
trust in someone's promise to fulfill an obligation. This is what a
debt is. The politicians in Washington have sold far more bonds
of this kind than there are T-bills and T-bonds in existence. The
official on-budget debt of the United States, which does not count
Social Security and Medicare, is in the range of $9 trillion. You can
monitor this on one of the debt clocks that are on the Web. The
cost of the long-run promises made by politicians and signed into law
cannot be calculated directly. This is an advantage for the
politicians. The national government's main promises in the United
States are these: Medicare, Social Security, other Federal pensions,
the ERISA private pension default insurance fund, the legally implied
future bailout of banks and savings & loans (which cost the
government hundreds of billions of dollars in the late 1980s), and
mortgage-issuing non-government agencies: Fannie Mae and Freddy
Mac. Medicare and Social Security are legal liabilities, but it
is not clear what their magnitude is. This depends on statistical
assumptions regarding birthrates, personal health, price inflation,
average life-spans, medical costs, immigration rates, and numerous
other factors. Of course, the crucial assumption does not appear in the
statistical summaries produced by the Social Security Trust Fund. That
assumption is that future taxpayers will abide by prior legislation
guaranteeing payments to retirees. The most frightening estimates
place the un-funded liability of Medicare and Social Security combined
above $70 trillion. Because the Trust Funds are filled with
nothing but non-marketable U.S. government bonds, there are no funded
liabilities at all. So, who will pay off these debts? The official
answer is the government of the United States. But that is a
legal entity which has existence only insofar as it can tax, borrow, or
create fiat money through the Federal Reserve System. Every other
Western industrial nation is in a similar situation. None of them has
taken steps to use tax revenue to invest in productive capital that
will be used to pay future beneficiaries. The entire Western economy is
awash in debt , not just on-budget debt with specific payment dates,
but open-ended debt that is based on yesterdays promises and today's
reassurances.
.
Incumbent
politicians do not want default to occur while their careers are still
at stake. So, they seek ways to postpone default. In the case of
retirement programs, they increase the age limit at which benefits
begin. This violates the promise of earlier politicians, but because
this is piecemeal default, there is no well-organized opposition. This
has already happened to Social Security. Another way to default
is to impose a means test. If you have an income above a specific
level, you must pay more into the system in premiums or receive less in
return. This policy has begun this year with Medicare. At some
point, piecemeal default becomes politically risky. The opposition
party, on the outside, will hold incumbents feet to the fire.
Vote for us if you want your promised money. This brings the
economically unsustainable promises into prominence. The least
controversial way to default is to create money to send to the
beneficiaries, as promised. The central bank can do this easily enough.
It buys the governments debts. This provides money for the government
to send checks to beneficiaries. One result is rising prices.
This unwanted result can be blamed on speculators or on greedy
businessmen. The public is unfamiliar with economic theory. Voters are
ready to accept the official explanations. They do not monitor central
bank statistics. When default takes place through monetary
inflation, default affects not just the governments budget. It affects
every debt-credit relationship. So, default through monetary inflation
has negative effects outside the government promises market. If
continued, this policy becomes default through the destruction of
currency. It becomes universal.
.
When
sons default on their implied social contracts by refusing to support
aged parents, this is microeconomic default. It happens, of course, but
the practice is not widespread. Social pressures against such default
are applied to those who break these unofficial contracts. The
parents usually have warnings in advance. Sons may not be reliable.
They may not be productive. Parents can search for other agents to
accept the role of reliable sons. They can transfer the
inheritance to these new agents. They can buy an annuity from an
insurance company. They can go to other relatives and create a trust
where the trustee will direct the inheritance to those who support the
aging parents. In other words, there are ways to reallocate
responsibility when the government is not the promissory. But when the
state has issued promises and then taxes workers to fund the
governments promises, the ability of the dependents to find alternative
arrangements falls dramatically. No one outside the government except
expensive tax lawyers and tax professionals can find ways to reallocate
the risk of default. The default then becomes macroeconomic. It applies
to everyone in the economy who pays taxes or receives the promised tax
benefits. This is the situation which Western taxpayers and
oldsters are facing over the next two decades.
.
When
a government defaults, the default is centralized. The default affects
people throughout the society. The grand experiment fails in full
public view. Government agents then blame others. There is no quest for
cause and effect, for such a quest must eventually identify the
culprit: the state. The states agents do not want this. Neither do most
of the victims. Most voters do not want to admit that they were
sucked into voting for a doomed program of coercive wealth
redistribution. That would call into question their morals as well as
their wisdom in trusting elected thieves and liars. This would make
them un-indicted co-conspirators. They resist such a suggestion. They
do not want a thorough investigation of failed government programs
generally, let alone one in which they became victims - first as
taxpayers, then as dependent recipients of tax revenues. There will be a tax
revolt at some point. There always is. But the damage to the economy
between now and then will be substantial. The school of hard knocks
imposes high tuition.
.
http://www.lewrockwell.com/north/north531.html
.
EDITORS NOTES:
The gentleman says that a government is in default or heading for
bankruptcy when a number of conditions exist: Means Test for
Welfare Payments, Inflation of the Money Supply, Etc. He goes on
to say that: If you have an income above a specific level, you must pay
more into the system in premiums or receive less in return. This policy
has begun this year with Medicare. In addition, the gentleman
also says - No one outside the government except expensive tax lawyers
and tax professionals can find ways to reallocate the risk of default.
The default then becomes macroeconomic. It applies to everyone in the
economy who pays taxes or receives the promised tax benefits. IF
it is true that default applies in this way, then I do not think one
needs to be an expensive lawyer or tax professional to figure it
out. It seems to me then, the common sense or logical answer
should be extract yourself (legally and without putting your family at
risk) from both sides of the equation. Regardless, I would agree
that the next twenty years are going to be very enlightening, and very
dangerous economically speaking, for a large number of people. To
borrow a phrase from a popular American television announcement:
What's in your wallet?
.
.
WIND
TELECOM CHOOSES NORTEL TO DEPLOY WIMAX NETWORK IN DOMINICAN REPUBLIC -
3/28/2007
.
SANTO
DOMINGO - Wind Telecom, a new network operator in the Dominican
Republic, and Nortel have signed a Letter of Agreement expressing their
firm commitment to deploy a wireless broadband network based on Nortel
WiMAX technology. Wind Telecom intends to offer high-speed broadband
services to urban and rural customers across the country. The
network is expected to be commercially available in September 2007 in
the initial launch cities of Santo Domingo, Santiago, Puerto Plata and
Bavaro/Punta Cana, with other areas such as La Romana, projected for
the near future. Nationwide coverage will be reached incrementally over
the next few years.
.
http://www.webwire.com/ViewPressRel.asp?aId=30784
.
EDITORS NOTES:
Imagine that. Nationwide wireless broadband internet service in a
so-called backwards, third world country. I guess they are not so
backwards after all.
.
.
US$300
MILLION IN JUST FOUR HOURS - May 20, 2007
.
Cap
Cana.- Within four hours of being launched in the presence of
multi-millionaire Donald Trump, Cap Cana and The Trump Organization
achieved record sales of lots at Farallón Trump at Cap Cana to
the value of some US$300 million. Presenting the project, Trump
said he was going to continue investing in the Dominican Republic
because the conditions for doing so are a given, and because the
government provides confidence for him to proceed with his real estate
plans. Cap Cana consortium president Ricardo Hazoury said that
the sales figure, which was achieved in just four hours and less than a
day is the highest for a tourist housing project in the Dominican
Republic and the Caribbean. The number of plots sold was 64 out
of 68, with prices starting from US$3 million, in the first phase of
the product launched by the company formed between Cap Cana and The
Trump Organization. The investors in the project, called
Farallón Trump at Cap Cana : 35% were from the Dominican
Republic, about 30% from the United States and Puerto Rico and 30% from
Venezuela, Spain and several Latin American countries. We are
truly surprised at the speed at which these sales were achieved. Never
has US$300 million been sold in such a short time in the Dominican
Republic and the Caribbean, stated Trump.
.
http://www.dominicantoday.com/app/article.aspx?id=23979
.
EDITORS NOTES:
Interesting. Three Hundred Million Dollars of real estate is sold
in one day inside a so-called poor, backwater, third world
nation. What do these real estate buyers know that you do
not? Why are so many foreigners buying up real estate in the
Dominican Republic?
.
.
WEB
SEARCHES AT U.S. BORDER BRING SCRUTINY TO NEW LEVEL
By
Adam Liptak - May 14, 2007
.
Andrew
Feldmar, a Vancouver psychotherapist, was on his way to pick up a
friend at the Seattle airport last summer when he ran into a little
trouble at the border. A guard typed Feldmar's name into an
Internet search engine, which revealed that he had written about using
LSD in the 1960s in an interdisciplinary journal. Feldmar was turned
back and is no longer welcome in the United States, where he has been
active professionally and where both of his children live.
Feldmar, 66, has a distinguished résumé, no criminal
record and a candid manner. Feldmar said he had been in the
United States more than 100 times and always without incident since he
last took an illegal drug. But that changed in August, thanks to the
happenstance of an Internet search, conducted for unexplained reasons,
at the Peace Arch border station in Blaine, Washington. The
search turned up an article in a 2001 issue of the journal Janus Head
devoted to the legacy of R.D. Laing, with whom Feldmar had studied in
London about 30 years before. He was asked by a border guard
whether he was the author of the article and whether it was true. Yes,
he replied. And yes.
Feldmar
was held for four hours, fingerprinted and, after signing a statement
conceding the long-ago drug use, sent home.
.
http://www.iht.com/articles/2007/05/14/news/legal.php
.
EDITORS NOTES:
I have said many times before that technology cuts both ways. It
can be used to enlighten and communicate or it can be used for other
purposes as well. Which is to say, there certainly is nothing
wrong with doing background checks (in fact, it probably is a very good
idea), or otherwise to make sure one is not letting in a person whom
you do not wish to have run amok in the general population - such as an
escaped serial killer, for example. On the other hand, I am
concerned about the idea that a newspaper or magazine article, a thesis
or whatever other sort of journalistic work can keep you barred from
entering the so-called freest nation on the planet (especially
something written 40 years ago in an academic publication). I
mean, there must be some degree of common sense applied to such issues
- no? Of course common sense is the one ingredient most lacking,
most of the time, when it comes to government it would seem (or maybe
not if done on purpose).
.
Interestingly
enough, on the topic of illegal drug usage, the United States contains
roughly 4 percent of the worlds total population, YET the United States
consumes about 70 percent of the worlds illegal drugs. In
addition, heroin use is on the rise in the US and 90 percent of the
worlds heroin is flowing out of Afghanistan (as of 2006 statistics), a
nation with a strong US military presence patrolling the country and a
government allied very closely to the US. One can almost surmise
that perhaps the drug trade in Afghanistan is being conducted with
tacit US government approval, for whatever else could be the excuse or
reason of such activities going on right under the control and watchful
eye of the US military and a certainly pro US government? In any
event, if illegal drug use by citizens really is the main issue, seems
to me that Canadians should be more concerned about letting Americans
into their country rather than the other way around.
.
.
PRINCETON PROFESSOR SAYS ANTI-BUSH SPEECH
LANDED HIM ON NO-FLY LIST - By James Freedman - 4/26/07
.
Walter
F. Murphy, a retired Marine colonel, earned a Purple Heart and the
Distinguished Service Cross for fighting in the Korean War. After
receiving a Ph.D. from the University of Chicago, he went on to teach
political science at Princeton University, where he's now the McCormick
Professor of Jurisprudence Emeritus. He's written more than a
dozen books, won numerous awards and is widely regarded as one of the
most influential constitutional scholars of his time. And now
he's been told he's on the Terrorist Watch List. It all started
on March 1. He was on his way to speak about his new book,
Constitutional Democracy: Creating and Maintaining a Just Political
Order. I was going off to a conference at Princeton for this new
book that Hopkins published, and I went to get a boarding pass at the
curbside check-in and the guy said, No, I'm sorry, you can't have a
boarding pass. Why not? Because you're on the Terrorist
Watch list. You'll have to go inside. So I went inside,
said Murphy. The clerk at the counter confirmed what Murphy had
already learned, but after he handed over his identification as a
retired Marine colonel and waited about ten minutes he was told he'd be
allowed to fly, but warned that his luggage would be
ransacked. IF it is just a simple mistake, though, everyone
interviewed thinks it should be taken care of as soon as possible, and
Murphy has sent in most of the forms requested by the TSA in order to
get things sorted out. However, he isn't holding his breath. One
guy called me and said he'd done it four months ago and nothing had
happened, said Murphy. He's still being stopped. And as a
veteran, Murphy is certainly unhappy with the situation. It does
irritate the hell out of me that an administration headed by a pair of
draft dodgers would question my loyalty to the United States, he
said. I mean, I shed my blood, and my friends shed their blood. I led
troops who fought hard and many of them died and a lot more were
wounded. And now suddenly I'm labeled an enemy of the United States?
.
http://media.www.jhunewsletter.com/media/storage/paper932/news/2007/04/26/
.
.
TERROR DATABASE HAS QUADRUPLED IN FOUR
YEARS: U.S. Watch Lists Are Drawn From Massive Clearinghouse -
By Karen DeYoung, Washington Post
.
Each
day, thousands of pieces of intelligence information from around the
world -- field reports, captured documents, news from foreign allies
and sometimes idle gossip -- arrive in a computer-filled office in
McLean, where analysts feed them into the nation's central list of
terrorists and terrorism suspects. Called TIDE, for Terrorist
Identities Datamart Environment, the list is a storehouse for data
about individuals that the intelligence community believes might harm
the United States. It is the wellspring for watch lists distributed to
airlines, law enforcement, border posts and U.S. consulates, created to
close one of the key intelligence gaps revealed after Sept. 11, 2001:
the failure of federal agencies to share what they knew about al-Qaeda
operatives. But in addressing one problem, TIDE has spawned
others. Ballooning from fewer than 100,000 files in 2003 to about
435,000, the growing database threatens to overwhelm the people who
manage it. The single biggest worry that I have is long-term quality
control, said Russ Travers, in charge of TIDE at the National
Counterterrorism Center in McLean. Where am I going to be, where
is my successor going to be, five years down the road? TIDE has
also created concerns about secrecy, errors and privacy. The list marks
the first time foreigners and U.S. citizens are combined in an
intelligence database. The bar for inclusion is low, and once someone
is on the list, it is virtually impossible to get off it. At any stage,
the process can lead to horror stories of mixed-up names and
unconfirmed information, Travers acknowledged.
.
http://www.washingtonpost.com/wp-dyn/content/article/2007/03/24/
.
EDITORS NOTES:
The man in charge of TIDE (I think my mom used to use that brand of
soap to do her laundry) says that the single biggest worry he has is
long term quality control. How is that again? He is worried
about quality control in a government agency that he is directly in
charge of? The article also states: The list marks the
first time foreigners and U.S. citizens are combined in an intelligence
database. The bar for inclusion is low, and once someone is on the
list, it is virtually impossible to get off it. Yes sir, George
Orwell would be proud. And if a retired colonel from the US
Marines (who is also now a professor at Princeton University) is on the
list, I can just imagine who else is on there too.
.
.
EXPORTS
POISED TO LIFT U.S. ECONOMIC GROWTH
By
Jeremy W. Peters - May 14, 2007
.
U.S.
companies have been doing business abroad for a long time, but those
markets have never been more important to them. This year, for
the first time, Standard & Poor's expects the 500 companies in its
benchmark stock index to generate more than half of their sales outside
the United States. More KFC fast food restaurants are opening in
China than in the United States. More than half of the 9.1 million
vehicles General Motors produced last year were sold outside the United
States. And with a slow U.S. housing market, Caterpillar is counting on
sales of earthmoving equipment and diesel engines in Europe, Asia and
the Middle East to keep itself growing. Even as companies in the
United States gain ground overseas, they are also sending more
U.S.-made products abroad. As a result, the huge U.S. trade deficit,
which swelled to a record $765.3 billion last year, could start to
close. While the trade gap widened in March, mostly because of
higher prices for imported oil, the vast disparity between U.S. imports
and exports is expected to narrow enough to contribute positively to
overall economic activity for the first time in more than a
decade. Faster growth in Europe and Asia is helping to cushion
the blow of a collapsing U.S. housing boom - which has slowed domestic
U.S. consumer spending - creating more demand from those markets for
goods and services made in the United States. U.S. companies'
goods and services have become more appealing overseas in part because
the value of the dollar has eroded. The British pound is at about $2,
and the euro has been inching toward $1.40. The depreciation has been
less considerable against the Yen and the Yuan, so U.S. exports to
Japan and China have not gained a competitive advantage.
.
http://www.iht.com/articles/2007/05/14/business/dollar.php
.
EDITORS NOTES:
Well, a few things catch my attention. First off, it is NOT the
American consumer (or companies) that is buying, but rather the growth
in sales in coming from Asia, Europe and the Middle East. This
tells me the US consumer (and the US economy in general) is tapped out
and the economic growth is someplace else (which we have been saying in
previous newsletters). Interestingly enough, middle class
consumers in developing or emerging markets do not use credit cards,
and instead pay cash for everything. In so-called poor third
world India, local citizens buy automobiles for CASH (and make other consumer
purchases this way), rather than bother with financing or bank
loans. Can you imagine such a thing? Most Americans cannot
afford to buy a car for cash, and yet their middle class counter parts
in India do it all the time.
.
And
of course a very weak US Dollar does make US products cheaper in Europe
or elsewhere BUT, what if ALL those products these American companies
were miraculously selling more of - were not even being made in America
at all? These American companies are supposedly in a position to
export more - but from where to where? How about China to Europe,
instead of Illinois to Europe (even though the name brand is
American)? Which is to say, US companies may be selling more
things abroad, but that does NOT mean this will be any sort of boon for
the US worker or the overall US economy. Do not be fooled by a
rising stock market. US companies MAY be making money from non US
sales, but this does not mean those profits are flowing back into the
US. Maybe the very reason such companies are able to make a
profit is BECAUSE the factory is offshore, the labor costs are lower
and the customers are outside the US as well (which perhaps means those
sales or profits are filtered through non US corporate subsidiaries in
other jurisdictions, presumably some with very low if any taxes at all).
.
The
article highlights Caterpillar (which is maker of earth moving and
construction related equipment plus a variety of diesel and marine
engines), saying that slightly more than half of its worldwide sales of
more than $41 billion are NOW generated outside the United
States. The company estimated that its engine and machinery sales
in North America will FALL 11 percent this year. But the rise in the
rest of the world - up 19 percent in Europe, Africa and the Middle East
and 17 percent in Asia - will more than make up for the loss.
What the news article has NOT told you is that Caterpillar announced
recently in May 2007 the opening of its new manufacturing facility in
Wuxi, China, that will house Caterpillar (China) Machinery Components
Co. Ltd. (CCMC), a wholly owned Caterpillar company, which is in
addition to the number of factories Caterpillar already has in
China. In fact, Caterpillar has 65 manufacturing facilities
located outside the United States. How many manufacturing
facilities does Caterpillar have inside the United States? And of
all the new manufacturing plants built or opened by the company within
the last twenty years - How many have been in the US and how many have
been abroad? The answer may surprise you and put a different spin
on the above news story as a result.
.
Looking
at other industries and companies, Citigroup, is eliminating 17,000
jobs and relocating 9,500 more - and India has been the
single biggest driver of growth of international operations for
Citigroup. Many U.S. companies are enlarging their operations
overseas. General Motors plans to more than double production in India
and build a new plant there (while layoffs inside the US loom).
This expansion is not only taking place among manufacturers. Financial
services companies like Ernst & Young are growing fastest in India
and China. Investment banks like Morgan Stanley, Goldman Sachs and
Merrill Lynch are also going on hiring binges to meet the needs of
expanding Asian companies. So, while it could be true that ever
larger sales are coming from outside of the US, for US corporations -
it is also true that it NOT necessarily will be the American worker
producing those products nor the US economy in general benefiting
either. Just one of those sticky details that can make all the
difference.
.
.
FIRST CHINESE-BUILT SATELLITE HERALDS
GROWING SPACE PROGRAM - May 15, 2007
.
BEIJING:
China has launched a Chinese-made communications satellite into orbit
on behalf of Nigeria, marking the first time it has built a commercial
satellite and put it into orbit on contract for another country.
The launch, early yesterday from the Xichang space centre in
south-western Sichuan province, was viewed as another sign of China's
increasing
prowess in outer space. The country's space agency, which is managed by
the military, sent two astronauts into orbit in October 2005 in its
second manned space flight.
.
http://www.smh.com.au/news/world/first-chinesebuilt-satellite-heralds-growing-space-program/2007/05/14/1178995077370.html
.
EDITORS NOTES:
A sign of the times. China launches a communications satellite
for Nigeria, a so-called third world country that happens to be awash
in petroleum deposits.
.
.
ANTIDEPRESSANT PRESCRIBING SOARS - Monday, 14 May 2007
.
The
number of prescriptions for antidepressants in England has hit a record
high despite national guidance advocating alternative treatments.
More than 31 million prescriptions for drugs such as Prozac were issued
in 2006 - a 6% rise on the year before. But figures from the
Information Centre indicate the number of prescriptions for
antidepressants are still on the rise. In particular
prescriptions for a group of drugs known as SSRIs, which include
Prozac, rose by 10% last year from 14.7m to 16.2m. There have
been fears that the drugs are linked to suicidal thoughts and self-harm
in some cases. In the Netherlands, Italy, Germany, Austria,
Belgium and Slovenia, patients with depression are prescribed
agricultural work.
.
http://news.bbc.co.uk/1/hi/health/6653013.stm
.
EDITORS NOTES:
What does this have to do with economics or whatever else, you might be
asking? Well, nothing really, but rather a very telling social
commentary instead, and this is a follow up to the story from the US in
the last newsletter. I mean to ask, why are so many people
depressed in the UK and the US? What in the world do they have to
be depressed about? Why are such prescription sales rising by 10
percent a year? Is the population growing by this amount
annually? What is the reason?
.
.
SHOTS FIRED AT POLICE CAR, COMMUTERS ON I-75
- May
15, 2007
.
Detroit
police are searching for a gunman who fired shots at cars on I-75 from
the E. Ferry overpass. That's in the area of the Detroit Medical
Center. It happened around 6 a.m. At least one of the bullets was
aimed at a Detroit police cruiser. The gunman was spotted by
officers in the cruiser that came under fire, and people in the area
reported hearing shots. The suspect is described as wearing a red shirt.
.
http://www.wxyz.com/news/local/
.
EDITORS NOTES:
Ah yes, the old red shirted police car shooting bandit, not to be
confused with some other guys shooting at cars on the beltway outside
of Washington, D.C. not too long ago. Many people often tell me
they are concerned about moving to another country because they think
there is a high degree of crime and they are concerned
accordingly. I do not know what to tell you, other than I have
never heard of nor seen this kind of nonsense in Panama or the
Dominican Republic. Can you imagine? Some nut taking a
loaded weapon to a highway over pass and shooting at on coming
traffic. Only in America. Maybe that is the kind of guy
that should be taking Prozac.
.
.
BANK SELLS HOUSE COMPLETE WITH OWNERS CORPSE
- May
15, 2007
.
MADRID
(Reuters) - A Spanish bank repossessed a house and put it up for
auction complete with the mummified body of the former owner who had
missed her mortgage payments, newspaper El Pais reported on
Wednesday. The corpse, preserved by salty air in the seaside town
of Roses after an apparent death by natural causes, was discovered by
Jorge Giro, who entered the house for the first time on Saturday after
buying it at the auction, El Pais said. The dead woman, described
by neighbors as having been in poor health and often absent visiting
relatives in Madrid, had stopped paying her mortgage six years
ago. The unnamed bank which eventually repossessed the home never
bothered to look inside before selling it.
.
http://www.reuters.com/article/oddlyEnoughNews/
.
EDITORS NOTES:
I guess as more and more homes become repossessed and put up for
auction, buyer beware would certainly seem to be the sound advice
(buyers at auctions in Detroit and Toledo take note). Then again,
maybe it's a new incentive. Buy a house and get a mummy for
free? I guess it is true that we are really very, very backwards
here in the Dominican Republic, because some of these things that
happen in the wealthy, modern first world nations do not happen in the
DR. People shooting at motorists from overpasses, throngs of
citizens taking drugs for depression, undiscovered bodies for six years
in a bank repossessed house - I don't know why this is, but you have to
wonder about it just a bit.
.
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