*****Gold Manipulation And Naked Short Selling Are ONE Conspiracy*****

As I mentioned in my last entry, the two biggest, most enduring, and most credible “conspiracies” in the financial world revolve around gold manipulation (See GATA's website (Gold Anti-Trust Action Committee)) and naked short selling (See DeepCapture.com).  Although they are treated as distinct from and unrelated to each other, these two conspiracies are in fact ONE.

Let's begin with a quick overview of gold manipulation and naked short selling in order to show how they are connected.


GATA provides a summary of the gold manipulation conspiracy.

A Summary of GATA's Work - Andrew Hepburn
Submitted by Administrator on Mon, 2004-01-12 08:00.
By Andrew Hepburn

The Gold Anti-Trust Action Committee (GATA) believes that central banks, acting through certain investment banks, have surreptitiously manipulated the price of gold. Such activity appears to have started in the mid-1990s and continues to this day. Prominent entities involved include J.P. Morgan Chase, Goldman Sachs, Deutsche Bank, the Federal Reserve, the Bank of England, and the Bank for International Settlements. GATA specifically alleges that the U.S. Treasury's Exchange Stabilization Fund [ESF] has been used, contrary to official denials, for gold market interventions. Furthermore, GATA believes that the official sector intervened in the late 1990s to prevent an impending gold derivative crisis, the result of excessive short positions accumulated over many years.

These claims are based on analyses of
publicly available government documents and statistics, trading abnormalities, and material presented in a GATA-backed lawsuit. Howe vs. Bank for International Settlements et al. accusing the BIS, Federal Reserve, U.S. Treasury, and four bullion banks of gold market manipulation. Though the suit was dismissed in 2002 on two technicalities, the evidence presented in it is recognized by many knowledgeable observers as having sufficiently proven the price-fixing allegations.

Central banks lease gold either by making gold deposits with, or by making gold loans to, bullion banks, the largest of which are international banks or other financial institutions. In both cases, the gold is placed with a bullion bank usually at a very low rate of interest, often 2% or less. This so-called "leased" gold is then sold into the market and the currency proceeds delivered for investment or other use by the bullion bank and/or its customer. When the gold deposit is called or the gold loan comes due, the physical gold required for repayment must generally be repurchased in the market.

The benefit to the bullion banks lay in the difference between
gold lease rates and prevailing interest rates. By borrowing gold cheaply, selling it into the spot market, and investing the proceeds in interest-bearing instruments, the gold borrowers realized substantial gains. …

Understanding the mechanics of the gold leasing (gold manipulation)

The Goldseek article below does a Forensic Examination of the Gold Carry Trade

Forensic Examination of the Gold Carry Trade
-- Posted Wednesday, 13 May 2009
By: Rob Kirby

… Central Banks “swap” and “lease” gold is an undeniable matter of public record.  …

Central Banks claim to “officially” have somewhere in the neighborhood of 30,000 metric tonnes of gold bullion in their vaults.  However, the reality is that Central Banks possess LESS physical gold than they officially report – how much less is a matter of speculation and a closely guarded secret.

The following formula explains the mechanics of the Gold Carry [lease] Trade:

** Do not confuse the Gold Forward Rate [GOFO] with the Gold futures price – they are not related.

What Happens When Gold Is Leased?

When Central Banks lease gold, it PHYSICALLY leaves the vault and the recipient / borrower sells the physical metal into the marketplace to raise cash – to invest or to finance capital expenditures. In this regard, we can say that “GOLD LEASING” is a means by which physical bullion is made available in the market place – thereby lowering the gold price.  After the gold physically leaves the vault of the Central Bank, it is replaced with an I. O. U. and the Central Bank, for accounting purposes, “double counts” by continuing to claim that they still possess the same amount of physical bullion in the vault.  It is notable that fraudulent accounting practices relating to gold is promoted by lawmakers the world over.  This is contrary to generally accepted accounting practices and promotes market opacity instead of the much talked about need for transparency.  Explicitly, it serves to promote the supremacy of the fiat U.S. Dollar as the world’s reserve currency.

I’ve circled the 10 % spike in lease rates on the chart below:


Now, let’s stop and consider WHO did the lending of metal in Sept. 1999 – expelling physical precious metal, intentionally at a loss, in the face of a RISING PRICE of GOLD. Remember folks, 3 month GOFO [the gold forward rate] is the return “earned” by the lender of bullion:


So ask yourself WHO would lend physical gold bullion to ANYONE with a guarantee that you would get LESS bullion back in 3 months????????????

What to take away from the passage above is that the gold lease rate is an indicator of how much central bank gold is being leased out.  The higher the lease rate, the more leased gold is being sold

It is also key to note that when leased gold is sold to investors around the world, the money collected is brought to the US and put into “interest-bearing instruments”.  This means more gold is leased out, the more demand is created for dollars and US treasuries.

Time Frame of the gold leasing fraud

The gold leasing that was rampant in the 1990s was ended by the “Washington Agreement”. 
The gold sextant explains how this happened.

February 1, 2000. Two Bills: Scandal and Opportunity in Gold?

On September 26, 1999, 15 European central banks, led by the ECB, announce that they will limit their total combined gold sales over the next five years to 2000 tonnes, not to exceed 400 tonnes in any one year, and will not increase their gold lending or other gold derivatives activities. Besides the ECB and the 11 members of the EMU, Britain, Switzerland and Sweden are parties. The 2000 tonnes include the remaining 365 tonnes of British sales and 1300 tonnes of previously proposed Swiss sales, leaving only 335 tonnes of possible new sales. The announcement, made in Washington following the IMF/World Bank annual meeting, is ironically christened the "Washington Agreement" although the government in Washington played no role. However, the BIS, IMF, U.S. and Japan are all expected to abide by it, and the BIS is expected to monitor it.

the agreement was hammered out secretly among the members of the EMU, the BIS and Switzerland, that the British were given a chance to sign on after the fact, and that the U.S. was not informed until just before the Sunday announcement. For references to European press commentary on the genesis of the agreement, see W. Smith, "Operation Dollar Storm," www.gold-eagle.com/editorials_99/wsmith111099.html.

The notion, shared by many, that the EMU would forever acquiesce in the trashing of its gold reserves by bullion banks operating in the largely paper gold markets of London, New York and Tokyo appears in retrospect to have been incredibly naive. With the euro successfully launched, they quickly lost reason to continue capping the gold price

… Currently the European central banks through the BIS and within the limits of the Washington Agreement are engaged in a tightly controlled feed of modest amounts of gold into the market.

Verifying timing through gold lease rate data  

The gold lease rate data going back to 1990 can be found by visiting the LBMA's website (LBMA = The London Bullion Market Association), as seen below.

By graphing this data, we see the gold leasing really took off in the 1990s.  However, after the 1999 Washington agreement, the flow of leased gold started to die off until it ended completely in the 2001/2002 period.

(Remember: The gold lease rate is an indicator of how much central bank gold is being leased out.  The higher the lease rate, the more leased gold is being sold.)

Full Resolution


Deedcapture explains that miscreants are selling billions of dollars of stock that simply does not exist (phantom stock).

The Story of Deep Capture
You can download a printable version of The Story of Deep Capture here.
By Mark Mitchell, with reporting by the Deep Capture Team
Introduction - by Mark Mitchell

August 12, 2005the proudest day of Patrick Byrne’s life.
Patrick is on a conference call with 500 blue chip investors and a few journalists. He tells his telephone audience that he’s been talking to this fellow named Bob …, and … he’s laid out this scheme, he’s made some predictions… so everybody please download Patrick’s computer generated slide show and follow along from home.

The first slide reads, “The Miscreants’ Ball.” Patrick says the miscreants are selling billions of dollars of stock that simply does not exist phantom stock. They have destroyed hundreds of public companies for profit. Some journalists, meanwhile, are “crooked.” They’re “lickspittles.” They are famous journalists and they cover up the miscreants’ crimes. They attack all who oppose them.

And that’s not all, follow along please with the slides — they show how
the miscreants and the journalists have ties to government agencies and private investigators, maybe the Mafia, and also an arms dealer, an undercover mole, a corrupt law firm, and Eliot Spitzer. …

The crimes are the work of Wall Street hedge fund managers and brokers who engage in a common trading strategy known as short-selling. A short sale is a way of making money when the price of a stock goes down. You borrow shares from someone else and immediately sell them off. If the price drops, you buy the shares back and return them to the original owner, pocketing the difference. If a company goes out of business, short-sellers hit the jackpot.

This is perfectly legal and unobjectionable. But some short-sellers do not play by the rules.
A small group of powerful hedge fund managers stop at nothing to annihilate the companies they sell short. Their tactics include: blackmail, smear campaigns, espionage, fraud, harassment, extortion, bribery, rumor-mongering, sabotage, off-shore money laundering, political cronyism, frivolous lawsuits, witness tampering, biased financial research, false identities, bogus credit ratings, bribery, libelous blogs, bad science, forgery, wiretapping, counterfeiting, collusion, lying, cheating, threats and theft.

Their most egregious trick is to sell “phantom stock.” By exploiting a glitch in Wall Street’s computerized trading system, and a loophole in federal regulations, some hedge funds sell virtually unlimited amounts of stock that they have not yet borrowed or purchased. This is often referred to as “NAKED SHORT SELLING.” Hedge funds use this tactic to flood the market with supply and drive down prices – which is blatantly illegal.

Patrick has written a blog explaining how this works in laymen’s terms.
An economist has written a detailed history of “FAILURES TO DELIVER” (i.e. stock sold and not delivered, because it is phantom stock) for Regulation magazine, published by the Cato Institute. A former SEC Chairman has spoken extensively against the problem. Many other researchers, several professors, a former SEC economist, and a former deputy secretary of commerce have also written papers on the subject. If you are interested in the mechanics of the crime, read some of those papers here, here, here, here, here, and here.

In addition to the 300-plus companies on the SEC’s list,
as many as 1,000 companies have already been wiped off the map by illegal short-selling, according to some experts.

Understanding the mechanics of stock “failures-to-deliver” (naked short selling)

Deedcapture describes the process through which naked short selling is used to destroy US companies.

It was in October 2004, and the Easter Bunny [Patrick Byrne's anonymous Wall Street informant] … made some predictions. He said that Gradient would continue to publish outrageous information at Rocker’s behest. He said the same information that had ended up in The Wall Street Journal, would soon get into the hands of specific reporters at Fortune, Forbes, MarketWatch.com, Barron’s magazine, and TheStreet.com – all of whom would call in the coming weeks. And he said that Overstock would soon become the target of a nonsensical federal investigation.

The Easter Bunny also laid out
THE MECHANICS OF SOMETHING CALLED "NAKED SHORT SELLING." He predicted that OVERSTOCK WOULD SUDDENLY BE LISTED, WITHOUT ITS AUTHORIZATION, ON A BUNCH OF FOREIGN STOCK EXCHANGES—making it easier for hedge funds to sell phantom stock. And he predicted that Overstock would appear on the SEC’s Reg SHO list of victim companies, scheduled to appear for the first time in January, 2005.

Over the next two weeks,
Patrick received calls from precisely the predicted journalists at Forbes magazine, Barron’s, The Wall Street Journal, The New York Post, and Fortune magazine – all of them reading the same list of questions supplied to them by Gradient.

Within a few weeks,
the Federal Trade Commission in San Francisco began a bizarre investigation into Overstock that went nowhere. Within a couple of months, OVERSTOCK HAD MYSTERIOUSLY APPEARED ON EXCHANGES IN STUTTGART, MUNICH, FRANKFURT, BERLIN, AND AUSTRALIA. And come January, the company was indeed on the SEC’s victim list (along with three other companies that Rocker had just hammered in a column for Barron’s magazine).

“The power of any theory is its ability to make predictions,” Patrick later says in his “Miscreants’ Ball” presentation. “It doesn’t matter how wacky a theory sounds, if it makes predictions that are confirmed, you’ve got to pay attention to it.”

There are two important points to note here about the naked short selling crimes outlined above:

1)  The targets of naked short sellers get listed on foreign exchanges

efore companies are attacked by naked short selling, they are listed on foreign exchanges without their knowledge.  This 2005 Euromoney article offers confirmation of this process.

Naked shorting: Stung by the German connection
April 2005
by Peter Koh

Thousands of US stocks are being traded on a little-known Berlin exchange, without the knowledge of many of the companies involved.

A YEAR AGO Ted Noble, chief financial officer at Advanced ID Corporation, a Calgary-based microchip-tracking company, received some surprising news.

"We were congratulated by a third party who saw that our shares were trading on the Berlin Stock Exchange," he recalls. "That came as news to us because WE'D NOT DONE ANYTHING TO GET LISTED IN GERMANY. I talked to a few people and we couldn't figure out whether it was good or bad."

Noble soon found out when his company's shares started behaving oddly on the US OTC bulletin board. "April 29 [2004] was a slow day, and only about 10,000 of our shares had traded. Then 370,000 shares traded in the last 20 minutes before the close. It knocked our stock price down from 58 cents to 41 cents, before closing nearly 20% down at 48 cents. That was very unusual for our stock. I'd never seen anything...

2)  The money from selling "phantom shares" doesn’t go to the naked short sellers

When stock IOUs are sold by naked short sellers, the money paid by the buyer goes into collateral (US treasuries) to backup the stock IOUs. 
This letter to the SEC confirms that “phantom shares” are collateralized.

Ms. Florence Harmon Acting Secretary Securities and Exchange Commission 100 F. Street, NE Washington, DC 20549-9303 Re: Release No. 34-58773; File No. 87-30-08 Amendment to Regulation SHO Interim Final Temporary Rule

Dear Sirs,

The foundation for the DTCC-administered clearance and settlement system in use in the U.S. has been illegally converted to one based upon mere “collateralization versus payment” or “CVP” wherein the seller of securities is only asked to collateralize the monetary amount of the failed delivery obligation on a daily marked to market basis.  This policy invites abusive naked short selling activity in that the failures to deliver shares results in the procreation of what are referred to as “securities entitlements” that are allowed to be readily sellable as if they were legitimate “shares” of a corporation due to the wording unfortunately incorporated into the text of UCC Article 8-501.  

So when "phantom shares" of US companies are sold “on exchanges in Stuttgart, Munich, Frankfurt, Berlin, and Australia”, the money collected from buyers is transferred to the US and put into treasury securities.  The more "phantom shares" are sold abroad, the more demand is created for dollars and US treasuries.

Time Frame of the naked short selling fraud

Naked short selling wasn’t a major problem during the 1990s.  It was only more recently that companies started getting wiped out of existence by “phantom shares”.  To see exactly when, we need to look at the data.

While the DDTC only started releasing failures-to-deliver (naked short selling) data for stocks after 2006, it is possible to get an idea when naked short selling started to be a problem by looking at the failures-to-deliver data for treasury securities, agency debt, and MBS.  This data is readily available on the Fed's website going back to 1990, as seen below.

By graphing this data, we see that naked short selling problem started in the 2001/2002 period.

Full Resolution

Comparing the gold lease rate and failure-to-deliver data

If we combine the gold lease rate and failure-to-deliver data into one graph, we get a pretty interesting result, as seen below.

Full Resolution

The graph above shows how naked short selling sprung up after the 1999 Washington agreement and became epidemic as gold leasing died out.  The odds of this being a coincidence are astronomically low.  Essential, the gold leasing fraud was replaced by the naked short selling fraud.

Motive behind gold manipulation and naked short selling

To find the connection between gold leasing and naked short selling, all you need to do is "follow the money".

Gold leasing: Investors around the world pay billions in foreign currencies to buy the thousands of tons of gold being leased out.  These foreign currencies are than converted into dollars (helping keep the US currency strong) and used to buy US treasuries (helping the US treasury finance the federal deficit) to serves as collateral for the loaned gold.

Naked short selling:  Investors around the world pay billions in foreign currencies to buy the millions of phantom stock in midsize companies listed on foreign exchanges.  These foreign currencies are then converted into dollars (helping keep the US currency strong) and used to buy US treasuries (helping the US treasury finance the federal deficit) to serves as collateral for the phantom stock.

The naked short selling fraud, which began after the 1999 Washington Agreement, was meant to replace the enormous flow of money into the dollar and US treasury market that was about to be lost due to the end of gold leasing.

The party responsible for both frauds

Since gold leasing and naked short selling both support the dollar and the US treasury market, the obvious party responsible is the Treasury's Department's Exchange Stabilization Fund (ESF) which is officially in charge of defending the dollar.  The ESF role in gold manipulation has long been recognized by GATA and others, as explained by the Golden Sextant

February 1, 2000. Two Bills: Scandal and Opportunity in Gold?

Evidence is accumulating that … the Clinton administration has effectively capped the gold price by using the ESF to backstop the selling of gold futures and other gold derivative products by politically well-connected bullion banks.

The odd behavior of the gold price over the past five years, including massive gold leasing and heavy bouts of futures selling apparently timed to abort threatened rallies, has generated considerable speculation regarding intentional manipulation by governmental authorities.

The Fed and the ESF are the only arms of the U.S. government with broad statutory authority "to deal in gold" and thus by reasonable extension in gold futures and derivatives. Were the Fed to engage in such activities, it would of necessity have to do so subject to all the institutional safeguards that govern its more important functions. Unlike the Fed, the ESF is virtually without institutional structure or safeguards. It is under the exclusive control of the Secretary of the Treasury, subject only to the approval of the President. Indeed, direct control and custody of the ESF must rest at all times with the President and the Secretary. The statute further provides (31 U.S.C. s. 5302(a)(2)): "Decisions of the Secretary are final and may not be reviewed by another officer or employee of the Government."

Originally funded out of the profits from the 1934 gold confiscation, the little known ESF is available for intervention in the foreign exchange markets.

… the allegation that knowledgeable gold market participants and observers are making … is that the ESF -- by writing gold call options or otherwise -- is making sufficient gold cover available to certain bullion banks to allow them safely to take large short positions in gold, thereby putting downward pressure on the price and in the process making huge profits for themselves.

While the ESF’s role in gold manipulation is recognized, its role in naked short selling, on the other hand, is not.

Patrick Byrne and Deep Capture unfortunately seem to believe that naked short selling is a wall street crime motivated by greed.  That isn't right.  It isn't the government regulators (SEC, etc...) that have been "deep captured" by Wall Street Interest.  It is Wall Street (DTCC, primary dealers, hedge funds, etc) that has been corrupted by the treasury department (specifically the ESF).

Conclusion: It is all ONE conspiracy

The gold manipulation conspiracy alledged by GATA and the naked short selling conspiracy alledged by Deepcapture are one and the same, and the Treasury's Exchange Stabilization Fund (ESF) is the force behind gold leasing and "phantom stocks".

(for the more about the Treasury's ESF, see my entry *****What I have been afraid to blog about: THE ESF AND ITS HISTORY*****)

Posted in Gold, Key_Entries, Treasury | 2 Comments

*****US Government Trying To Censor The Internet*****

Techdirt.com reports that you should Call Your Senators Today: Tell Them To Vote Against Censoring The Internet.

(emphasis mine) [my comment]

Call Your Senators Today: Tell Them To Vote Against Censoring The Internet
from the make-this-stop-already dept

As mentioned last week,
there's a big push going on by the MPAA and the US Chamber of Commerce (the largest lobbying organization in the world) to get PROTECT IP voted on and approved in the next few days or weeks. Some in the Senate leadership have decided that with everything else going wrong in the economy these days, they can repackage this as a "jobs" bill, and pretend that they're "helping the economy." Of course, nothing is further from the truth. PROTECT IP (PIPA) is a sure jobs killer in that it will significantly hinder innovation on the internet, including those responsible for millions of new jobs over the past decade. On top of that, IT WILL SET UP THE VERY FIRST MASSIVE INTERNET CENSORSHIP PROGRAM WITHIN THE US. It's hard to see how that's helpful for jobs at all.

The backers of this bill are hoping that
since SOPA is even worse than PIPA, there will be less protest and some may see it as a "compromise." That's ridiculous. It's a very dangerous bill that will have long-lasting consequences. If you're an American citizen and believe in the importance of innovation online, today is the day to call your Senators. The folks at Fight for the Future have set up a very easy system to do that. You just put in your info, and it will first give you a quick summary of key points, and then connect you to your Senators. If the Senate realizes that the public really is against this bill, then hopefully they'll finally dump it.

New York Times reports about Stopping the Great Firewall of America.

Op-Ed Contributor
Stop the Great Firewall of America
Published: November 15, 2011

China operates the world’s most elaborate and opaque system of Internet censorship. But Congress, under pressure to take action against the theft of intellectual property, is considering misguided legislation that would strengthen China’s Great Firewall and even bring major features of it to America.

The legislation — the Protect IP Act … has been introduced in the Senate, and a House version known as the Stop Online Piracy Act. …
The solutions offered by the legislation, however, threaten to inflict collateral damage on democratic discourse and dissent both at home and around the world.

The bills would empower the attorney general to create a blacklist of sites to be blocked by Internet service providers, search engines, payment providers and advertising networks, ALL WITHOUT A COURT HEARING OR A TRIAL. The House version goes further, allowing private companies to sue service providers for even briefly and unknowingly hosting content that infringes on copyright — a sharp change from current law, which protects the service providers from civil liability if they remove the problematic content immediately upon notification. The intention is not the same as China’s Great Firewall, a nationwide system of Web censorship, but the practical effect could be similar.

Abuses under existing American law serve as troubling predictors for the kinds of abuse by private actors that the House bill would make possible. Take, for example, the cease-and-desist letters that Diebold, a maker of voting machines, sent in 2003, demanding that Internet service providers shut down Web sites that had published internal company e-mails about problems with the company’s voting machines. The letter cited copyright violations, and most of the service providers took down the content without question, despite the strong case to be made that the material was speech protected under the First Amendment.

The potential for abuse of power through digital networks — upon which we as citizens now depend for nearly everything, including our politics — is one of the most insidious threats to democracy in the Internet age. We live in a time of tremendous political polarization. Public trust in both government and corporations is low, and deservedly so. This is no time for politicians and industry lobbyists in Washington to be devising new Internet censorship mechanisms, adding new opportunities for abuse of corporate and government power over online speech. …

The Digital Journal reports that Blacklist Bill allows Feds to remove websites from Internet.

Op-Ed: Blacklist Bill allows Feds to remove websites from Internet
By Nancy Houser
Oct 27, 2011

The House version of the Internet Blacklist Bill was released October 26, 2011, with no effort to fix problems that existed in the Senate version. A violation of the First Amendment, it is contrary to official positions of internet freedom and censorship.

Under the Internet Blacklist Bill — S.968, formally called the PROTECT IP Act — the Department of Justice would force search engines, browsers, and service providers to block users’ access to websites that have been accused of copyright infringementwithout even giving them a day in court.” (Demand Progress)

The S.968 bill is considered dangerous and short-sighted due to its broad writing that covers a multitude of issues, bringing danger to not only Internet security but is considered a serious threat to free online speech and innovation. The Censorship-galore Department describes it as an attempt to build
the Great Firewall of America, requiring service providers to block access to certain websites.

With the Internet Blacklist Bill literally shoved through the House,
those same copyright holders will be able to cut off advertising and payment processing to such sites. WITHOUT COURT REVIEW.

EFF.org reports that Disastrous IP Legislation Is Back - And It's Worse than Ever.

Disastrous IP Legislation Is Back – And It’s Worse than Ever
October 26, 2011 - 4:08pm
By Corynne McSherry

We’ve reported here often on efforts to ram through Congress legislation that would authorize massive interference with the Internet, all in the name of a fruitless quest to stamp out all infringement online.  Today Representative Lamar Smith upped the ante, introducing legislation, called the Stop Online Piracy Act, or “SOPA,” that would not only sabotage the domain name system but would also threaten to effectively eliminate the DMCA safe harbors that, while imperfect, have spurred much economic growth and online creativity.

As with its Senate-side evil sister, PROTECT-IP,
SOPA WOULD REQUIRE SERVICE PROVIDERS TO "DISAPPEAR" CERTAIN WEBSITES, endangering Internet security and sending a troubling message to the world: it’s okay to interfere with the Internet, even effectively blacklisting entire domains, as long as you do it in the name of IP enforcement. Of course blacklisting entire domains can mean turning off thousands of underlying websites that may have done nothing wrong. …

But it gets worse.
Under this bill, service providers (including hosting services) would be under new pressure to monitor and police their users’ activities.  Websites that simply don’t do enough to police infringement (and it is not at all clear what would qualify as “enough”) are now under threat, even though the DMCA expressly does not require affirmative policing.  It creates new enforcement tools against folks who dare to help users access sites that may have been “blacklisted,” EVEN WITHOUT ANY KIND OF COURT HEARING. The bill also requires that search engines, payment providers (such as credit card companies and PayPal), and advertising services join in the fun in shutting down entire websites.  In fact, the bill seems mainly aimed at creating an end-run around the DMCA safe harbors. Instead of complying with the DMCA, a copyright owner may now be able to use these new provisions to effectively shut down a site by cutting off access to its domain name, its search engine hits, its ads, and its other financing even if the safe harbors would apply.

And that’s only the beginning: we haven’t even started on the streaming provisions.

We’ll have more details on the bill in the next several days but suffice it to say, 
THIS IS THE WORST PIECE OF IP LEGISLATION WE'VE SEEN IN THE LAST DECADE — and that’s saying something.  This would be a good time to contact your Congressional representative and tell them to oppose this bill!

Even the Business Software Alliance now backpedaling on SOPA support (Ars Technica)
European Parliament joins criticism of SOPA (Macworld UK)

Congress seeks to tame the Internet (Salon)
Filtering and Blocking Closer To The Core Of The Internet? (Intellectual Property Watch)
Why SOPA Will Destroy the Internet As We Know It (The Faster Times)
The US joins China in censoring the Internet (The Voice of Russia)
SOPA Could Kill the Internet: Experts (TheStreet.com)


Technorati reports that Google Censorship Rising Faster Than Ever.

Google Censorship Rising Faster Than Ever
Stephen Alexander
Published: November 28, 2011 at 5:25 pm

Google Censorship

Google is rapidly becoming the internet police in regards to censorship on the internet. Google has complied with nearly two-thirds of the requests for removing content between January and June, according to a recent transparency report. As compared to the previous reporting period this is an huge increase from the lowly forty percent rate.

The report said that
there were 757 items to be removed by request and 92 content removal requests from government agencies and courts. The reasons for removal range from allegations of defamation, copyright, privacy, and security. In addition, there are claims that content is unlawful as hate speech and pornography.


Economic Policy Journal reports that Deepcapture Web Site Shut Down.

Saturday, October 22, 2011
Deepcapture Web Site Shut Down

[deepcapture.com = GATA (in terms of credibility)]

The web site, Deepcapture.com, founded by Overstock's Patrick Byrne to battle and report from an anti-short seller perspective, parts of the Wall Street underworld, appears to be shutdown.

According to Stockwatch.com,
Vancouver promoter Altaf Nazerali has won a court order that has at least temporarily shut down the deepcapture.com website. He complained that the site, which purports to expose[s] stock market wrongdoing, posted material portraying him as a criminal and a fraud artist [HE IS A CRIMINAL AND A FRAUD ARTIST!]. The order, handed down in the Supreme Court of British Columbia on Wednesday, Oct. 19, instructs the site's host to block access to any material referring to Mr. Nazerali and prohibits the domain's registrar from allowing a transfer of the domain.

While it is not clear how much of deepcapture.com directly referred to Mr. Nazerali,

My reaction:  Congress is considering misguided legislation will set up the very first massive internet censorship program within the US.

1)  The bills, PROTECT-IP and SOPA, would empower the attorney general to create a blacklist of sites to be blocked by Internet service providers, search engines, payment providers and advertising networks, all without a court hearing or a trial.

2)  private companies will be able to sue service providers for even briefly and unknowingly hosting content that infringes on copyright.

3)  This is the worst piece of IP legislation we've seen in the last decade.

4)  Google censorship is already rising faster than ever.

5)  PROTECT-IP and SOPA would require service providers to "disappear" certain websites, effectively blacklisting entire domains.

6)  The deepcapture.com has already been "disappeared" from the web. (I will write more on naked short selling in a later entry)

7)  Today is the day to call your elected representative tell them to vote against censoring the internet.

Conclusion:  The two biggest, most enduring, and most credible “conspiracy” websites in the financial world were GATA's website (Gold Anti-Trust Action Committee) and DeepCapture.com (about illegal naked short selling).  Now one of those two is gone.

It appears that in there desperation to keep Americans unaware its rampant corruption, the government is now trying to simply censure the internet.  If those two bills above pass, it won’t be long before
GATA's website and MarketSkeptics.com end up like DeepCapture.com, A BLANK SCREEN.

Posted in News_Developments | 1 Comment

The article Newsweek gutted–proof of FBI corruption

The Examiner reports about the article Newsweek gutted.

(emphasis mine) [my comment]

The article Newsweek gutted--more proof of FBI corruption
Anthony Martin, Conservative Examiner
November 25, 2011

When citizen investigative journalist Mike Vanderboegh
reported earlier this week that
an article that appeared in Newsweek Magazine [See Newsweek article titled My Life as a White Supremacist] this week was supposed to contain explosive information damaging to the current Administration and that of Bill Clinton, he had a good idea of what was cut by editor Tina Brown due to his numerous contacts in the government. Today, however, Vanderboegh has an unedited copy of the original version of the article, complete with credible evidence of corruption that exposes Eric Holder, Janet Reno, the FBI, and two Administrations as threats not only to the truth but to the very lives of American citizens.

The original article was written by reporter R.M. Schneiderman and approved by his immediate editor John Solomon is extensive. An abbreviated step-by-step overview of that article is provided below.

1.  Schneiderman uncovered
revelations concerning the Oklahoma City bombing that not only implicate Clinton Administration officials in mass murder but contain a direct link to the Obama Administration, the current FBI, and Attorney-General Eric Holder, who worked for Janet Reno at the Department of Justice during the 1990s. Two informants, John Matthews and Jesse Trentadue, provided the FBI and DOJ with information showing that Timothy McVeigh had worked in tandem with other persons, thereby blowing the theory of the 'lone bomber.'

2.  Matthews, who was working with the government to infiltrate extremist groups, had provided information to the FBI indicating that
one Tom Posey, who had been a suspect in another crime called the Brown's Ferry Plot, had collaborated with Timothy McVeigh. It was Posey who was the first to talk about the use of weapons of mass destruction to blow up federal buildings--a prospect that prompted Matthews to go to the FBI. But there is evidence that Posey was cooperating with the FBI, providing them key information about various extremist groups in the U.S.

3.  Matthews had also encountered Timothy McVeigh in Texas, in the company of one
Andreas Carl Strassmeier, another suspect in the planning of the Oklahoma City bombing. McVeigh and Strassmeier were both involved in the para-military movement and were participating in training exercises in Texas.

Neither Posey nor Strassmeier were ever pursued by the FBI for their role in the bombing, leading Matthews to conclude that the entire case of the FBI against McVeigh as the 'lone bomber' was highly suspect.

5.  A racist, neo-Nazi group in Texas called
the Texas Light Infantry is key to understanding the plot to blow up the federal building in Oklahoma City. It was within this very group that Matthews encountered McVeigh and Strassmeier. Yet the article in Newsweek fails to mention the militia group at all. Instead the article identifies the Texas Reserve Militia. This deft sleight of hand appears to be aimed at hiding the truth about the Texas Light Infantry, where McVeigh and Strassmeier laid out their plot. 

Another FBI informant by the name of Dave Rossi was key to the plot, yet that information was also cut out of the final copy of the article that appeared in Newsweek. Rossi knew Posey very well from numerous encounters at various and sundry meetings of extremist militia groups. Rossi was also a key operative in the FBI's scandalous and murderous covert program called PATCON--'Patriot Conspiracy'--which was involved in all of the major scandals going back decades, including the massacres at Ruby Ridge and Waco.

7.  Newsweek editor Tina Brown also cut out from the final article
an entire section that the reporter had included on Utah Attorney Jesse Trentadue, whose brother was beaten to death in prison shortly after the Oklahoma City bombing. Trentadue believes that his brother was killed by the FBI in a case of mistaken identity. The official report claims that Trentadue hanged himself in the cell. But photos indicate that his throat had been cut. There were bruises all over his body. A federal judge later ruled the FBI had lied in court about the case and destroyed evidence. The Trentadue family was awarded 1.1 million dollars in damages for emotional distress.

the key facts in the original article written by R.M. Schneiderman for Newsweek/The Daily Beast/The Washington Post wound up in the waste basket of editor Tina Brown. Why? Informants say the FBI, the DOJ, and the Obama Administration pressured the organization to withhold the information.

with the ongoing scandal involving Project Gunwalker [See *****PROJECT GUNRUNNER?THE BIGGEST SCANDAL SINCE IRAN-CONTRA***** and *****Update On Growing Gunrunning Scandal*****] --Operation Fast and Furious--the Administration may be interesting in protecting key figures in high places, particularly given that MANY OF THOSE INVOLVED IN GUNWALKER WERE ALSO PART OF THE SCANDAL SURROUNDING THE OKLAHOMA CITY BOMBING. 

The Examiner reports about the consequences of truth-telling: Newsweek editor explodes at staff.

Consequences of truth-telling: Newsweek editor explodes at staff
Anthony Martin, Conservative Examiner
November 27, 2011

The consequences of telling the truth at Newsweek/Washington Post/The Daily Beast are coming into sharp focus as
editor Tina Brown reportedly exploded in a tirade at the staff of the news organization. The reason? The leak of the unedited story Brown refused to allow to be published as originally written on the FBI scandal involving PATCON, the Oklahoma City bombing, and Operation Fast and Furious. [See SSI Exclusive: Hiding mass murder behind "national security." What Newsweak & the FBI didn't want you to know about PATCON and the OKC Bombing]

Insider sources say that Brown is furious that
someone on her staff sent a copy of the original article to citizen investigative reporter Mike Vanderboegh, which he proceeded to publish on his blog, Sipsey Street Irregulars. An abbreviated summary of the information Brown cut out of the story is provided here.

Washington Post reporter R.M. Schneiderman and his immediate supervisory editor John Solomon had been working on the explosive story of FBI corruption for months. That story included details of a sordid, secret operation of the FBI called 'PATCON,' which has been involved in murder and scandal for decades going all the way back to the Ruby Ridge and Waco massacres.

But when Newsweek/The Daily Beast was ready to publish the story,
editor Tina Brown intervened at the last minute, removing all of the key components of the report and focusing instead on one lone undercover informant who had information about 'extremist right-wing neo-Nazi groups' in the United States. Sources inside the government report that Brown was under intense pressure from the Obama Administration, Attorney-General Eric Holder, and the FBI to cut key portions out of the story.

someone at the news organization was furious that the story was gutted for political purposes. That someone sent Vanderboegh the complete uncut edition of the story.

The consequences are fear, loathing, and anger on the part of the White House, the FBI, and Tina Brown. The government parties involved in the various scandals are afraid of what this information will lead to. They loathe the persons responsible for leaking the story. And their anger is on full display, especially that of Tina Brown, who reportedly is demanding to know who on her staff leaked the story to Vanderboegh.

According to Vanderboegh,

...the Spanish Inquisition began at Newsweak within two hours of the posting Friday of "Hiding mass murder behind 'national security. What Newsweak & the FBI didn't want you to know about PATCON and the OKC Bombing." [Here is the link again]

Tina Brown is said to very angry and is determined to find out who leaked the details of the story she didn't want to surface. Wombat reports that
the screaming was largely focused on the fact that Tina has decided that she really, really doesn't like me. Really.

Various editors, reporters and sources are under suspicion.

Vanderboegh further indicates that sources have informed him that the White House, the DOJ, and the FBI are sore at him as well for putting the story out there for the public to see. The fear is over possible blow-back...
there is not much that can be done in terms of damage control once the genie has been let out of the bottle.

Sipsey Street Irregulars reports an SSI Exclusive: Hiding mass murder behind "national security." What Newsweak & the FBI didn't want you to know about PATCON and the OKC Bombing.

Thursday, November 24, 2011
SSI Exclusive: Hiding mass murder behind "national security." What Newsweak & the FBI didn't want you to know about PATCON and the OKC Bombing.

[Read this article for the actual text that was taken out of the Newsweek article.]

When you take the gutted version of the story , there is one thing that leaps out at any independent observer -- the full truth about the FBI's involvement in, and prior knowledge of, the Oklahoma City bombing has yet to be even scratched.

Newsweek is evidently so compromised by political considerations that it cannot tell these truths.

It remains to be seen
if there are any other "mainstream media" outlets who can, or will.

But at least, gentle readers, you know now
the extent of Newsweek's perfidy in hiding the truth that threatens both the comfortable bureaucratic existence of the FBI and the reputations of people such as Eric Holder and Janet Napolitano

My reaction:  For the second time this month (See ‘60 Minutes’ Blows Lid Off Congressional Insider Trading), investigative reporting is revealing shocking evidence of government corruption.

What happened

1)  An article that appeared in Newsweek Magazine this week (See My Life as a White Supremacist) was supposed to contain explosive information damaging to the current Administration and that of Bill Clinton.

2)  However before it went to print, the article (written by reporter R.M. Schneiderman and approved by his immediate editor John Solomon) was gutted by Editor Tina Brown, who removed credible evidence of corruption on the part of Eric Holder, Janet Reno, the FBI, and two Administrations.

3)  Someone on Newsweek’s staff sent an unedited copy of the original version of the article to citizen investigative reporter Mike Vanderboegh who proceeded to publish on his blog, Sipsey Street Irregulars.

What is revealed in the uncut edition of the story

1)  Not only are Clinton Administration officials implicated in the Oklahoma City bombing, but also the Obama Administration, the current FBI, and Attorney-General Eric Holder.

2)  Two informants, John Matthews and Jesse Trentadue, provided the FBI and DOJ with information showing that Timothy McVeigh had worked in tandem with other persons.

3)  These “other persons” (Andreas Carl Strassmeier and Tom Posey) were ever pursued by the FBI for their role in the bombing, making the entire case of the FBI against McVeigh as the 'lone bomber' was highly suspect.

4)  Many of those involved in Gunwalker were also part of the scandal surrounding the Oklahoma city bombing.  (See *****PROJECT GUNRUNNER?THE BIGGEST SCANDAL SINCE IRAN-CONTRA***** and *****Update On Growing Gunrunning Scandal*****)

How it happened

1)  Washington Post reporter R.M. Schneiderman and his immediate supervisory editor John Solomon had been working on the explosive story of FBI corruption for months.

2)  Editor Tina Brown then intervened at the last minute, removing all of the key components of the report and focusing instead on one lone undercover informant.

3)  Brown was under intense pressure from the Obama Administration, Attorney-General Eric Holder, and the FBI to cut key portions out of the story.

4)  Someone at the news organization was furious that the story was gutted for political purposes and leaked the complete uncut edition of the story.

5)  Editor Tina Brown has reportedly exploded in a tirade at the staff of the news organization.

Conclusion:  The corruption of US media is being openly exposed for all to see.  The true story here is:

A)  Th
at original article exposing FBI corruption came so close to being published.
B)  That the original, uncut edition of the story was leaked
at all.

This is further proof that
the government’s control over the media is failing (see *****The ESF's Wurlitzer (Propaganda Machine) Is Slowly Dying*****).

The long-dead stories of government corruption are starting to reach the general public

Radioactive topics that have been buried for decades are slowly coming to the surface:  The Congressional Insider Trading exposed by '60 Minutes', the growing Gunrunner scandal, the FBI's involvement in (and prior knowledge of) the Oklahoma City bombing (described above), etc…

In attempting to control the damage, mainstream media is destroying its credibility

In its efforts to contain the spread of these stories, mainstream media is being forced to openly display its own corruption (See *****The Extraordinary Lack Of Coverage Of Ron Paul***** for example).  As the article above states, "Newsweek is evidently so compromised by political considerations that it cannot tell these truths.  It remains to be seen if there are any other ‘mainstream media’ outlets who can, or will.”

Corrupt mainstream media is the key pillar enabling all the widespread fraud occurring in America.  Once it goes, the whole rotten system goes with it.  With incredibly-damaging, long-dead stories finally reaching the surface, we are getting very near that point.

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