Have nothing to do with the [evil] things that people do, things that belong to the darkness. Instead, bring them out to the light... [For] when all things are brought out into the light, then their true nature is clearly revealed...

-Ephesians 5:11-13

Category Archives: History

This Thoroughbred is Just Beginning to Feel His Oats

This article was published by The McAlvany Intelligence Advisor on Friday, October 20, 2017:

English: Thoroughbred racing at Churchill Down...

Thoroughbred racing at Churchill Downs.

It’s tempting to push the analogy comparing the U.S. economy to a Thoroughbred horse too far. But it is tempting. The Thoroughbred breed began around the time of the Industrial Revolution, when an English mare was crossbred with an imported Oriental stallion with Arabian, Barb, and Turkoman breeding. All Thoroughbreds can trace their pedigrees to three stallions imported into England in the 17th century. They were exported to Australia, Europe, Japan, and South America during the 19th century, and today an estimated 100,000 Thoroughbred foals are registered worldwide every year.

A Thoroughbred is tall, slender, athletic, and built for competition, usually on racetracks. Among the most famous are Citation, Phar Lap, Old Rosebud, Whirlaway, Roamer, Seabiscuit, and Man o’ War.

And, of course, the United States economy.

Starting at around 1800, the U.S. economy grew at such a rate that

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Dow Crosses 23,000 for the First Time in History

Performance of the Dow Jones Industrial Index ...

Performance of the Dow Jones Industrial Index during Black Monday

This article appeared online at TheNewAmerican.com on Tuesday, October 17, 2017:

The Dow Jones Industrial Average (DJIA), colloquially called “The Dow,” crossed over the 23,000 benchmark level early Tuesday morning for the first time in history. The Dow, which tracks the stocks of 30 major corporations, has gained 25 percent since the election while the NASDAQ (which tracks the stock performance of a vastly larger and more diversified range of companies across the globe) is up 27 percent. The S&P 500 Index (which tracks the stock performance of 500 American companies) is up 19 percent.

The Wall Street Journal had no trouble finding money managers who were willing to comment positively on the news. Mark Freeman, chief investment officer and portfolio manager at Westwood Holdings Group (which invests $22 billion for its customers), told the Journal:

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Pelosi Calls for More Background Checks After Las Vegas Shooting

This article appeared online at TheNewAmerican.com on Wednesday, October 11, 2017: 

English: Nancy Pelosi photo portrait as Speake...

California Democrat Senator Nancy Pelosi

Following the ghastly shooting in Las Vegas, a retired Marine captain and gun store owner confronted Senator Nancy Pelosi (D-Calif.) at a town hall meeting and asked her what sort of gun control measures could be implemented in the future to keep someone such as Stephen Paddock from murdering innocent civilians in the future. Pelosi said the present NCIS (National Instant Criminal Background Check System) is working just fine:

We have come together in a bipartisan way to put together what we thought would save the most lives. And that is to have background checks, gun violence prevention background checks, and to have them be effective.

But of course even a great system such as NCIS can be improved by expanding those background checks to include every private gun transaction between every private citizen, just to make sure the government knows everything. Said Pelosi:

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After Thousands of Hours Investigating Las Vegas Shooter’s Background, FBI Still Doesn’t Know Why

English: FBI agents from the Washington Field ...

This article was published by The McAlvany Intelligence Advisor on Monday, October 9, 2017:  

Officially there are 100 FBI agents working the case against Stephen Paddock, the Las Vegas shooter. That doesn’t count amateur sleuths, local police, the BATFE, and the Justice Department. After thousands of man hours, they have come up with: nada.

They found what they hoped was his suicide note. It turned out to be undecipherable, “significant to the gunman” but to no one else. They uncovered video of him driving to a public shooting range just outside Mesquite where he lived. But further investigation revealed that he never fired a single round from any of his “bump stock” rifles.

They checked into his prescription for Valium hoping that they could pin his murderous behavior on its “aggressive behavior” side effects. But

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Gunmakers’ Stock Prices Continue to Rise Following Las Vegas Massacre

This article appeared online at TheNewAmerican.com on Tuesday, October 3, 2017:

Dianne Feinstein, member of the United States ...

Dianne Feinstein

After the Las Vegas massacre on Sunday night, the stock prices of gunmakers rose two to three percent on Monday. Following the noisy threats of more gun controls by anti-gun politicians, those stocks have continued to rise on Tuesday. Since the close of business last Friday, for example, the stock price of Sturm Ruger & Co. has jumped by 6.3 percent, while American Outdoor Brands Corp. (which owns Smith & Wesson) is trading seven-percent higher. The stock price of Vista Outdoor Inc., the conglomerate with ownership of ammunition makers American Eagle, Blazer, and Federal Premium, as well as gunmakers Savage Arms and Stevens Arms, is trading 3.5 percent ahead of Friday’s closing price.

The simple explanation for this was expressed by Mark Zandi, chief economist at Moody’s Analytics:

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Tax-reform Plan Called “Tremendous” by Trump, “Fake Math” by Schumer

This article appeared online at TheNewAmerican.com on Thursday, September 28, 2017:

In unveiling the tax reform “framework” cobbled together by the Trump administration, the House Ways and Means Committee, and the Senate Finance Committee on Wednesday, President Trump called it “tremendous”: “This is a tremendous change, and the biggest winners will be the everyday American workers as jobs start pouring into our country, as companies start competing for American labor and as wages start going up [to] levels you haven’t seen in many years.”

On cue, House Minority Leader Nancy Pelosi (D-Calif.) expressed her concerns about deficits, perhaps for the first time in her political career:

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Using Truth to Fight Globalist Lies About The John Birch Society

This article appeared online at TheNewAmerican.com on Monday, September 25, 2017:

English: Sign from the John Birch Society advo...

Sign from the John Birch Society advocating US withdrawal from the United Nations , with Ron Paul sign in background,

The John Birch Society has been enduring rampant smears of late, being called anti-Semitic and a white nationalist group. But the truth is far different — and always has been.

If you represent any sort of threat against the establishment and its glob­alist agenda, prepare to be ruthlessly demonized and lied about by that same globalist establishment. Exhibit A is, of course, President Donald Trump. After announcing that he was running on an anti-globalist platform to “drain the swamp,” the billionaire businessman was relentlessly smeared across every propaganda organ the establishment possesses. If the “fake news” media, as Trump correctly calls them, is to be believed, the president is a racist, white supremacist, anti-Semite, white nationalist, lunatic, conspiracy theorist, agent of Vladimir Putin, and another Hitler.

Of course, no actual evidence is ever provided,

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Trump’s Regulatory Rollbacks Already Being Felt

This article appeared online at TheNewAmerican.com on Friday, September 22, 2017:

English: G. Edward Griffin

G. Edward Griffin

The latest report from the American Action Forum (AAF), which has been tracking President Trump’s promise to deregulate American businesses, continues to be upbeat. In April it had found that the repeal or delay of regulations imposed during the Obama administration could lead to $86 billion “in net fiscal effects” for taxpayers as a result. The latest from AAF said that the trend downward in regulations and upward in freedom from them continues apace.

In July the Washington Post counted 860 regulations that the Trump administration was either pulling or suspending, and then included commentary from anti-Trump liberals that

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China is Suffering from the Same Curse as the U.S.: Too Much Debt, Too Little Growth

This article was published by The McAlvany Intelligence Advisor on Friday, September 22, 2017:  

Live video feed of Zig Ziglar speaking at the ...

Zig Ziglar speaking at the Get Motivated Seminar at the Cow Palace in Daly City, California.

When Zig Ziglar was trying to motivate salesmen, he would often tell them that “there aren’t very many problems that can’t be solved by sufficient production.” This, unfortunately, has been picked up by statist economists who have assumed that any production, at any cost, will solve any problem. Put another way, “We can grow our way out from under the massive debt we have. And we can grow the economy by stimulating it with borrowed funds.”

Zig would be appalled:

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S&P Downgrades China’s Credit Rating

This article appeared online at TheNewAmerican.com on Thursday, September 21, 2017:  

Thanks to “diminished financial stability,” S&P Global Ratings downgraded China’s credit rating for the first time since 1999, adding, “China’s prolonged period of strong credit [debt] growth has increased its economic and financial risks. Although this credit [debt] growth had contributed to strong real gross domestic product growth and higher asset prices, we believe it has also diminished financial stability.”

The downgrade by S&P is the second one this year for China — Moody’s Investors Service dropped China’s rating in May — and was preceded by a warning from the International Monetary Fund (IMF) in August that China’s growing debt binge was putting its economy into jeopardy.

The response by Chinese officials was as predictable as it was silly.

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As the Fed Shrinks Its Balance Sheet, Nothing Can Go Wrong

This article was published by The McAlvany Intelligence Advisor on Wednesday, September 20, 2017:

Investors and Wall Street gurus, seers, and prognosticators paid attention on Wednesday to the emanations from the Federal Reserve board meeting, hoping to glean more of the details about the “great unwinding” of the Fed’s enormously bloated balance sheet. In June, Fed Chair Janet Yellen suggested that the time was drawing near to begin reducing the Fed’s balance sheet and there were at least two ways to start: letting maturing bonds “roll off” instead of reinvesting the proceeds in new issues, and liquidating, ever so slowly, some U.S. treasuries, starting at $10 billion a month in October. That liquidation would increase on a quarterly basis until it topped out at $50 billion a month.

The goal, it was suggested, was to

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Impact of Fed’s Plan to Do a “QE Unwind”

This article appeared online at TheNewAmerican.com on Tuesday, September 19, 2017: 

English: Official picture of Janet Yellen from...

Janet Yellen

What makes tomorrow’s [today’s – Wednesday, September 20] meeting at the Federal Reserve so interesting to market watchers and bond investors is the likelihood that Fed Chair Janet Yellen will provide more details on her plans to begin unwinding the Fed’s balance sheet: how much, how fast, how soon, and what does it all mean? In addition, she is hoping to placate conservatives in Congress who remain unhappy over the Fed’s intervention in the markets in the aftermath of the real estate collapse that triggered the Great Recession.

In June, Yellen outlined some possible scenarios, which included letting some of the bonds on the central bank’s enormous $4.2 trillion balance sheet simply mature without reinvesting the funds in new issues. She suggested the Fed would also start selling off some $10 billion a month of existing securities, and then raise that amount every quarter until it reaches $50 billion a month. This way, by expanding on her plans, and by slowly — very slowly — shrinking the Fed massive balance sheet, she hopes to avoid another “taper tantrum” that bond investors experienced back in 2013 when then-chairman Ben Bernanke first said the Fed should start reducing some of its holdings of U.S. Treasuries and mortgage-backed securities.

If she provides sufficient clarity, and sufficient caution, Yellen might not only start the process without disrupting the market, but also avoid further criticism from congressional critics who think the Fed stepped way out of bounds in starting the whole “quantitative easing” (QE) program in the first place. In that way — again, if she is successful — she will not only cement into place the Fed as a necessary element in the American economy, but show that further “QE” expansions to meet future recessions are a legitimate tool.

Whether she can pull it off is an open question. Keynesian economist Austan Goolsbee, who headed Obama’s Council of Economic Advisors in 2010 and 2011, said, “The final exam, with the grade yet to be determined, is: can the Fed actually get out of this stuff?”

The Fed has been essentially flying blind for years, moving outside not only its mandate (to maximize labor force participation while keeping inflation under control) but its past experience. Said David Blanchflower, a Dartmouth College economist (read: Keynesian) who was on the monetary policy committee of the Bank of England from 2006 to 2009, expressed it perfectly: “We had no idea what we should buy, how much, for how long … [and] there is no idea on the way going out.”

It was all a grand experiment: expand the money supply to keep interest rates so far below market rates that people seeking income would take higher risks — i.e., dividend-paying stocks, real estate ventures, etc. — and home owners would find it easier to buy houses. This was the Keynesian antidote to the economic collapse. Rather than let the economy right itself by itself (see America’s recession and recovery in 1920-1921), Keynesians suffer the hubris to think they know better than the market, and intervened, resulting in the longest, slowest recovery from a recession in American history.

Once the Fed began to embark on its plan to bail out banks and other financial institutions in the wake of the real estate collapse, there was no going back. When the federal government took over Fannie Mae and Freddie Mac — mortgage insurers that were approaching bankruptcy — it found that it needed to buy up billions of their failing mortgages. That explains why $1.7 billion of the Fed’s balance sheet consists of mortgages and mortgage-backed securities.

But when that didn’t work the Fed adopted the strategy of “quantitative easing” (QE) — creating money to spur spending across the economy — which some observers thought would never end.

But it did end, in 2014, and the Fed has been sitting on its massive pile of government and mortgage debt, waiting for the economy to revive enough so it could be offloaded without major economic disruptions.

The Fed won’t be unwinding its entire portfolio. Instead it expects to reduce it by between $800 billion and $1 trillion over the next few years, leaving in place a balance sheet of between $2.5 and $3.2 trillion. This means that the Fed will never again see days when its balance sheet shrinks all the way back to the $900 billion it had prior to the Great Recession.

Its plan should have little impact on short-term rates. Using the 10-year Treasury as the standard, when Yellen’s plan (assuming it begins in October) kicks in, it might boost its yield by perhaps a quarter of a percentage point. This would be the natural result of increasing supply in a market with a fixed demand. When more is supplied, prices will go down. In the bond market that translates into a mini-interest rate hike.

But demand from abroad for U.S. bonds continues to be strong. Yields on 10-year bonds issued by foreign governments such as Japan’s and Germany’s remain far below U.S. 10-year bonds and so any increase in rates here will only make them more attractive to foreign buyers.

In fact, once Yellen has filled in the details, as she is expected to do on Wednesday, investors and market watchers are likely to express a sigh of relief, and continue the Fed-fueled rally in stocks that began in 2009 and that shows little sign of stopping. Diane Swonk, chief economist at DS Economics, agrees: “The start to reducing the Fed’s balance sheet is an action the markets are ready for. The Fed has laid out a roadmap and there is really a sense of relief to finally get it started.”

New York Fed: Economy Will Benefit From Harvey and Irma

This article appeared online at TheNewAmerican.com on Monday, September 11, 2017:

Frédéric Bastiat

Frédéric Bastiat

In a statement reflecting a worldview taught by all major universities and espoused by central bankers around the world, the president of the Federal Reserve Bank of New York, William Dudley, said on Friday that, on net, the destruction wrought by the hurricanes will be positive for the economy: “[The initial] effects tend to be pretty transitory. [But] the long-run effect of these disasters unfortunately is it actually lifts economic activity because you have to rebuild all the things that have been damaged by the storms.”

Dudley got the first part right:

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If Dudley is Right, Then Let’s Pray for the Flooding of the Entire Country!

This article was published by The McAlvany Intelligence Advisor on Monday, September 11, 2017:

Cover of "The Emperor's New Clothes"

Cover of The Emperor’s New Clothes

Taken to its logical conclusion, William Dudley, the president of the Federal Reserve Bank of New York, thinks a flood covering all of the United States would stimulate the economy. Several sources confirmed that this is what Dudley said on Friday in an interview at CNBC concerning the economic effects of hurricanes Harvey and Irma:

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Shiller’s CAPE, Harvey, Irma, and now Jose: How Much More is Needed for a Stock Selloff?

This article was published by The McAlvany Intelligence Advisor on Friday, September 8, 2017:

English: (left) and meeting shortly after the ...

Republicans Smoot and Hawley

Wall Street prognosticators have watched Robert Shiller’s CAPE – “cyclically adjusted price-to-earnings” ratio – for years for signs that stocks are becoming overvalued. It’s now at a nosebleed level reached just before the October 1929 crash. The good news is that CAPE has been at that level ever since Shiller said that stocks were overvalued earlier this year. It is not a market timing tool, but more of an early warning indicator.

Short sellers have gotten smashed as the stock market continues to defy gravity. Bets against the SPDR S&P 500 exchange-traded fund, the largest ETF tracking that index, fell to lows in July not seen since May 2013.

But Hurricanes Harvey, Irma, and now possibly Jose may finally bring things back to earth. The jump in unemployment claims for the week ending September 2, caused by Harvey and reported by the Department of Labor (DOL) on Thursday, not surprisingly exceeded economists’ consensus. The increase of 62,000 for the week to

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Jump in Jobless Claims Following Harvey Is Just the Beginning

This article appeared online at TheNewAmerican.com on Thursday, September 7, 2017:

View of the eyewall of Hurricane Katrina taken...

View of the eyewall of Hurricane Katrina taken on August 28, 2005 as the storm made landfall on the United States Gulf Coast.

The jump in unemployment claims for the week ending September 2, as reported by the Department of Labor (DOL) on Thursday, not surprisingly exceeded economists’ consensus of just 241,000. The increase of 62,000 for the week to 298,000 nearly broke a claims record that has been in place for 131 weeks: 300,000.

That record will surely be broken in the weeks to come. The unemployment claims are just beginning to come in, and they are a predictor — a proxy — for job layoffs. Some workers

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Virgin Islands Governor: Seize Firearms Ahead of Hurricane Irma

This article appeared online at TheNewAmerican.com on Wednesday, September 6, 2017:

English: Looking down at Magens Bay from Mount...

Looking down at Magens Bay from Mountain Top, Saint Thomas, U.S. Virgin Islands.

In anticipation of the arrival of Hurricane Irma, U.S. Virgin Islands Governor Kenneth Mapp on Tuesday ordered the Islands’ National Guard to “seize arms, ammunition, explosives, incendiary material and any other property that may be required by the military forces for the performance of this emergency mission.”

More chillingly, Governor Mapp has ordered his adjutant general, Deborah Howell, “to take whatever actions she considers necessary to carry out the assigned mission,” presumably actions that could end the lives of anyone resisting the Guard’s demands.

This is “necessary to maintain or restore order, and to guarantee the safety of life and property” adds the order, with nothing said about the safety of the lives of those who think the Vitter Amendment protects them from such seizures.

The Vitter Amendment, otherwise known as the Disaster Recovery Personal Protection Act of 2006, was passed following the order of the mayor of New Orleans to confiscate firearms in the wake of Hurricane Katrina.

David Codrea, writing for Oathkeepers, called this order by the Islands’ governor a

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Anti-gun Researcher Frightened by How Many Guns Americans Own

This article appeared online at TheNewAmerican.com on Tuesday, September 5, 2017:

Image of the Bill of Rights (United States Con...

The virulently anti-gun group The Trace sent an e-mail blast to its members last week, alerting them to what it said was the danger of an overly and unnecessarily armed American citizenry:

Jennifer Mascia [a member of “TeamTrace”] pulled some numbers from the Small Arms Survey, which gauges gun stockpiles in the hands of civilians, law enforcement, and militaries around the world. She found that with an estimated 270 million firearms owned by everyday Americans, civilians own 70 times more weapons that all police and military services combined.

Mascia is an editorial assistant at the New York Times and was a regular contributor to its anti-gun column “The Gun Report” until it was shut down in 2014. Her source, the Small Arms Survey, is an international anti-gun group purporting to provide accurate statistics on all aspects of private gun ownership worldwide. Unfortunately, its reputation for accuracy has been tainted, with much of its reporting being challenged as “misleading or just plain wrong.”

In this instance, however, the numbers Mascia dug up from the outfit actually understated the “concerns” she expressed about how many firearms are owned by those “everyday Americans.” The real number isn’t 270 million — not even close — but is at least

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Persistence is Paying Off in Gun Shop’s Fight with Chicago

This article was published by The McAlvany Intelligence Advisor on Friday, September 1, 2017:

The Miniature Bull Terrier Club of America (MBTCA)’s website suggests that owners looking for a dog that is compliant and easily trained “would probably be better off with a [different] breed.” The average MBT is “persistent,” “stubborn,” “independent,” “doesn’t listen,” “bold and confident,” and “foolish to the point of self-destruction.”

Enter Alan Gottlieb, the founder and Executive Vice President of the Second Amendment Foundation (SAF). On the surface Gottlieb is presentable as a normal, well-behaved, articulate defender of the Second Amendment. His organization that began in 1974 now has more than 650,000 members, of which this writer is one. But put him into the same ring as Mayor Richard Daley or Mayor Rahm Emanuel of Chicago, and he becomes an MBT.

One of many examples surfaced on Wednesday when

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Federal Judge Refuses Chicago’s Request to Dismiss Long-running Gun Shop Suit Against it

This article appeared online at TheNewAmerican.com on Thursday, August 31, 2017:  

In a long-running lawsuit that should be testing the limits of the patience of the Second Amendment Foundation (SAF), U.S. District Court Judge Robert Dow on Wednesday denied the city’s latest request to dismiss the case, and set September 28 as the next date to discuss the amount of damages Chicago owes to the long-suffering plaintiff.

A measure of the intransigence of mayors of Chicago Richard Daley and Rahm Emanuel is

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Many of the articles on Light from the Right first appeared on either The New American or the McAlvany Intelligence Advisor.