Call To Action Radio Meeting, hosted by GAWTP Founder, George Stephenson ......Week 8/30/10

.....The Strategy of Local Government WatchDogs: JoAnn Fleming, GAWTP Executive Director

.....GAWTP WatchDogs Explain Why They Are WatchDogs: Richard Blake & Ken Allison

.....WatchDog Impact on Local Government: Smith County (TX) Commissioners Jeff Warr & Terry Phillips

.....Emergency Preparedness: Drying Food with Don Pectol, Emergency Essentials

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It takes a lot to spook the solid old gold market. But when it emerged last week that one or more banks had lent 380 tonnes of gold to the Bank of International Settlements in return for foreign currencies, there was widespread surprise and confusion.

By Garry White and Rowena Mason  Published: 11 Jul 2010     www.telegraph.co.uk

The news that a mystery bank has just pawned the family jewels gave traders a jolt - nervous about the sudden transfer of almost 20pc of the world's annual gold production and the possibility of a sell-off.

In a tiny footnote in its annual report, the bank disclosed its unusually large holding of gold, compared with nothing the year before. The disclosure was a large factor in the correction of the gold price this week, which fell below $1,200 for the first time in more than a month.

Concerns hinged on whether the BIS could potentially sell on this vast cache of bullion in the event of a default, flooding the market with liquidity. It appears to have raised $14bn for whoever's been doing the swapping - small fry on the currency markets, but serious liquidity in the gold market.

Denominated in euros, gold has fallen 8pc since the beginning of the month and is now trading at a seven-week low of €937 per troy ounce.

The big gold exchange traded funds (ETFs) - having peaked at record inflows in May - have also been showing net outflows over the past few days.

Meanwhile, economists and gold market-watchers were determined to hunt down which bank is short of cash - curious about who is using their stash of precious metal for what looks suspiciously like a secret bailout.

At first it looked like the BIS was swapping gold with a troubled central bank. After all, the institution is the central bankers' bank and its purpose to conduct transactions with national monetary authorities.

Central banks in the troubled southern zone of Europe were considered the most likely perpetrators.

According to the World Gold Council, central banks in Greece, Spain and Portugal held 112.2, 281.6 and 382.5 tons of gold respectively in June - leading analysts to point fingers at Portugal, or a combination of the three.

But Edel Tully, an analyst from UBS, noted that eurozone central banks would be severely limited with what they could do with the influx of extra cash - unable to transfer it straight to governments or make use of the primary bond markets.

She then listed the only other potential monetary authorities with enough gold as the US, China, Switzerland, Japan, Russia, India and Taiwan - and the International Monetary Fund.

This led to musings that the counterparty was the IMF, making sense because the lender of last resort is historically prone to cash shortages and has been quietly selling off gold in the first half of the year.

Renowned gold expert Jim Sinclair adopted this explanation. The panic came when people mistook a lease for a swap, he argues. Far from being a big release of gold into the market, it is simply a commercial arrangement between the IMF and BIS with a favourable rate of interest paid for the foreign currency.

"Gold swaps are usually undertaken by monetary authorities," he writes on his industry blog, MineSet. "The gold is exchanged for foreign exchange deposits with an agreement that the transaction be unwound at a future time at an agreed price.

"The IMF will pay interest on the foreign exchange received. Historically swaps occur when entities like the IMF have a need for foreign exchange, but do not wish to sell the gold. In this case, gold is a leveraging device for needed currency to meet requirements.

"The many reports that characterise the large IMF gold swap as a sale of gold into the markets do not understand the difference between a swap and a lease."

However, the day after original reports about the swaps, BIS emailed a statement saying that the swaps had not been conducted with monetary authorities but purely with commercial banks.

This did nothing to quell the sense of mystery surrounding the deal or deals. It is almost inconceivable that a single commercial bank could have accumulated so much gold alone. And cynics have suggested that the whole affair still looks like a secretive European bailout that a single country wants to keep quiet.

In this case, one or more of the so-called bullion banks - which act as wholesale market-makers and include Goldman Sachs, Deutsche Bank, JP Morgan, HSBC, Barclays, UBS, Societe Generale, Mitsui and the Bank of Nova Scotia - would have agreed to act on behalf of a monetary authority.

This would add an extra layer of anonymity. "So the BIS swaps look like a tripartite transaction," writes Adrian Douglas of the Gold Anti-Trust Association. "The commercial bank or banks made a swap with a central bank or banks and then the commercial bank or banks made a swap with the BIS."

Analysts for Commerzbank note that in the meantime, "The price of gold is tending weaker at present."

Baltic Dry Index still falling

The Baltic Dry Index, a measure of commodity shipping costs, has fallen for the longest period in nine years, due to lower volumes of iron ore being shipped to China.

Surplus steel means manufacturers are relying on stockpiles, rather than shipping in iron ore from abroad.

The index of freight rates on international trade routes fell 38 points, or 2pc, to 1,902 points on Friday in its 31st straight decline.

Charter rates for all types of ships fell.

Buyers angry at 'excessive' cocoa speculation

European cocoa buyers are so concerned about potential speculation in the market that they have written to the London commodities exchange threatening to move their trade to America.

Talks between industry participants and Liffe, the London exchange operator, will take place this week, following concerns about the price spike in June.

Futures hit a 32-year high, amid lower production due to diseased crops in Africa and higher demand.

Those who signed the letter claim there has been excessive speculation by hedge funds and want greater transparency about who is buying what and how much.

Become Citizen Plaintiffs Against ObamaCare ... Learn Why & How

NO Friday GAWTP Call To Action Lunch Meeting This Week

Before Glenn Beck's Town Hall Meeting this Saturday at 7:30pm on April 24...Special Call To Action Meeting at 4pm at the Oil Palace in Tyler, TX, FREE admission for the 4pm meeting.

Learn why and how you can become one of 10,000 citizen plaintiffs against ObamaCare. GAWTP has teamed up with The Justice Foundation to take this lawsuit ALL the way to the Supreme Court.

Clayton Trotter from The Justice Foundation will explain the process and the long term commitment. Citizens must take a stand. This is YOUR opportunity to stand up and be counted. COME & LEARN. FREE Admission at the 4pm Special Meeting at the Oil Palace.

Also...patriotic and stirring messages from Pastor C.L. Bryant, featured speaker at last year's 9/12 March on Washington, and Pastor Stephen Broden, Republican Elect for U.S. Congress, Dist 30 (Dallas area). Both have spoken at GAWTP in the past.

Lots of Patriotic Music.

GAWTP is Advancing Freedom on ALL fronts. Become a member of GAWTP today!

By STEPHEN OHLEMACHER, Associated Press Writer Stephen Ohlemacher, Associated Press Writer - Mon Mar 15, 7:57 am ET

PARKERSBURG, W.Va. - The retirement nest egg of an entire generation is stashed away in this small town along the Ohio River: $2.5 trillion in IOUs from the federal government, payable to the Social Security Administration.

It's time to start cashing them in.

For more than two decades, Social Security collected more money in payroll taxes than it paid out in benefits - billions more each year.

Not anymore. This year, for the first time since the 1980s, when Congress last overhauled Social Security, the retirement program is projected to pay out more in benefits than it collects in taxes - nearly $29 billion more.

Sounds like a good time to start tapping the nest egg. Too bad the federal government already spent that money over the years on other programs, preferring to borrow from Social Security rather than foreign creditors. In return, the Treasury Department issued a stack of IOUs - in the form of Treasury bonds - which are kept in a nondescript office building just down the street from Parkersburg's municipal offices.

Now the government will have to borrow even more money, much of it abroad, to start paying back the IOUs, and the timing couldn't be worse. The government is projected to post a record $1.5 trillion budget deficit this year, followed by trillion dollar deficits for years to come.

Social Security's shortfall will not affect current benefits. As long as the IOUs last, benefits will keep flowing. But experts say it is a warning sign that the program's finances are deteriorating. Social Security is projected to drain its trust funds by 2037 unless Congress acts, and there's concern that the looming crisis will lead to reduced benefits.

"This is not just a wake-up call, this is it. We're here," said Mary Johnson, a policy analyst with The Senior Citizens League, an advocacy group. "We are not going to be able to put it off any more."

For more than two decades, regardless of which political party was in power, Congress has been accused of raiding the Social Security trust funds to pay for other programs, masking the size of the budget deficit.

Remember Al Gore's "lockbox," the one he was going to use to protect Social Security? The former vice president talked about it so much during the 2000 presidential campaign that he was parodied on "Saturday Night Live."

Gore lost the election and never got his lockbox. But to illustrate the government's commitment to repaying Social Security, the Treasury Department has been issuing special bonds that earn interest for the retirement program. The bonds are unique because they are actually printed on paper, while other government bonds exist only in electronic form.

They are stored in a three-ring binder, locked in the bottom drawer of a white metal filing cabinet in the Parkersburg offices of Bureau of Public Debt. The agency, which is part of the Treasury Department, opened offices in Parkersburg in the 1950s as part of a plan to locate important government functions away from Washington, D.C., in case of an attack during the Cold War.

One bond is worth a little more than $15.1 billion and another is valued at just under $10.7 billion. In all, the agency has about $2.5 trillion in bonds, all backed by the full faith and credit of the U.S. government. But don't bother trying to steal them; they're nonnegotiable, which means they are worthless on the open market.

More than 52 million people receive old age or disability benefits from Social Security. The average benefit for retirees is a little under $1,200 a month. Disabled workers get an average of $1,100 a month.

Social Security is financed by payroll taxes - employers and employees must each pay a 6.2 percent tax on workers' earnings up to $106,800. Retirees can start getting early, reduced benefits at age 62. They get full benefits if they wait until they turn 66. Those born after 1960 will have to wait until they turn 67.

Social Security's financial problems have been looming for years as the nation's 78 million baby boomers approached retirement age. The oldest are already there. As that huge group of people starts collecting benefits - and stops paying payroll taxes - Social Security's trust funds will shrink, running out of money by 2037, according to the latest projection from the trustees who oversee the program.

The recession is making things worse, at least in the short term. Tax receipts are down from the loss of more than 8 million jobs, and applications for early retirement benefits have spiked from older workers who were laid off and forced to retire.

Stephen C. Goss, chief actuary for the Social Security Administration, says the crisis has been years in the making. "If this helps get people to look more seriously at that in the nearer term, that's probably a good thing. But it's only really a punctuation mark on the fact that we have longer-term financial issues that need to be addressed."

In the short term, the nonpartisan Congressional Budget Office projects that Social Security will continue to pay out more in benefits than it collects in taxes for the next three years. It is projected to post small surpluses of $6 billion each in 2014 and 2015, before returning to indefinite deficits in 2016.

For the budget year that ends in September, Social Security is projected to collect $677 million in taxes and spend $706 million on benefits and expenses.

Social Security will also collect about $120 billion in interest on the trust funds, according to the CBO projections, meaning its overall balance sheet will continue to grow. The interest, however, is paid by the government, adding even more to the budget deficit.

While Congress must shore up the program, action is unlikely this year, said Rep. Earl Pomeroy, D-N.D., who just took over last week as chairman of the House subcommittee that oversees Social Security.

"The issues required to address the long-term solvency needs of Social Security can be done in a careful, thoughtful and orderly way and they don't need to be done in the next few months," Pomeroy said.

The national debt - the amount of money the government owes its creditors - is about $12.5 trillion, or nearly $42,000 for every man, woman and child in the country. About $8 trillion has been borrowed in public debt markets, much of it from foreign creditors. The rest came from various government trust funds, including retirement funds for civil servants and the military. About $2.5 trillion is owed to Social Security.

Good luck to the politician who reneges on that debt, said Barbara Kennelly, a former Democratic congresswoman from Connecticut who is now president of the National Committee to Preserve Social Security and Medicare.

"Those bonds are protected by the full faith and credit of the United States of America," Kennelly said. "They're as solid as what we owe China and Japan."

Politico.com by Glenn Thrush  3-8-10

Whatever he has done or not done, I will miss Eric Massa, for no other reason than his gift with a phrase.

In an amazing, far-ranging interview/monologue with a Rochester-area radio station, Massa admits making an off-color, sexual comment to a young staffer -- but still claims Democratic leadership ratted him out to kill a health care "no" vote.

That brought him to the subject of Rahm Emanuel and arm-twisting:

"Rahm Emanuel is son of the devil's spawn," Massa said, according to City Hall. "He is an individual who would sell his mother to get a vote. He would strap his children to the front end of a steam locomotive."

Later in the interview, Massa -- who sits down with Glenn Beck for a one-hour interview on Tuesday -- tells a bizarre story about Emanuel accosting him in the House gym -- in the buff:

"Let me tell you a story about Rahm Emanuel," Massa started. "I was a congressman in my first eight weeks, and I was in the congressional gym, and I went down and I worked out and I went into the showers...I'm sitting there showering, naked as a jaybird and here comes Rahm Emanuel not even with a towel wrapped around his tush, poking his finger in my chest, yelling at me because I wasn't going to vote for the president's budget. Do you know how awkward it is to have a political argument with a naked man?"

Massa has never enjoyed a particualrly close relationship with Emanuel, who was chairman of the Democratic Congressional Campaign Committee when Massa first ran for unsuccessfully, without much DCCC support, in 2006.

Massa's near defeat of incumbent Randy Kuhl that year -- he lost by 6,033 votes -- attracted the attention of Emanuel's successor Rep. Chris Van Hollen (D-Md.), who helped Massa defeat Kuhl in a nail-biting rematch in '08.

The relationship between Massa and House leadership has been in the dumps for months, and only got worse after he bucked leadership on the health reform vote last fall -- earning him the enmity of House Speaker Nancy Pelosi and her ally Emanuel.

Few tears have been shed over Massa's departure on the Hill. Other member descibe him as volatile, argumentative and the antithesis of the a team player.

The Republican campaign has been a grudge match between Gov. Rick Perry and Sen. Kay Bailey Hutchison, but a little-known activist named Debra Medina has emerged as a key factor.

By Mark Z. Barabak, Los Angeles Times   February 16, 2010

Reporting from Victoria, Texas - Debra Medina isn't calling for Texas to secede from the union. She thinks the state should simply ignore federal laws that Texans can't abide.

"You get [the Environmental Protection Agency] off the backs of Texas agriculture, energy and manufacturing, we won't have an economic crisis," the gubernatorial hopeful says.

She doesn't advocate bloodshed, though Medina believes it may be inevitable "if we don't stand up and start to defend this free, great nation and get it back to . . . constitutional principles."

At another time, in another place, Medina might be a mere curiosity, peddling unconventional ideas -- replacing property taxes with a bigger sales tax, encouraging every citizen to be armed -- from the political fringe. But as early voting starts Tuesday in the March 3 primary, Medina has emerged as a key factor in a Republican race once seen as a battle between two titans, Gov. Rick Perry and U.S. Sen. Kay Bailey Hutchison.

Although sparsely funded, Medina, a small business owner and "tea party" activist, could draw enough support to force an April runoff. (Former Houston Mayor Bill White is the likely Democratic nominee.)

Until a recent stumble -- during a radio interview, Medina wouldn't rule out the notion that the government was behind Sept. 11 -- she was well positioned to slip past Hutchison in the first round of balloting.

Very little, it seems, is far-fetched in this angry election season.

The grudge match between Perry and Hutchison has built for years, ever since the governor supposedly reneged on a private pledge to step down after 2010 to clear the way for Hutchison. Perry says he made no such promise.

Still, the candidates' mutual contempt is obvious. Between them, Perry and Hutchison are expected to spend about $50 million scratching and clawing, and more if there is a runoff. (Medina has raised less than $700,000, using her credit card for such expenses as air travel.)

Perry, the longest-serving governor in Texas history, relentlessly assails Hutchison as "a Washington-establishment type who has voted for bailouts, wild spending and skyrocketing debt." Hutchison, a three-term senator, portrays Perry as lazy and corrupt, saying he has rewarded his political cronies but done little else. "It's time we had a governor whose record is as good as the rhetoric," she says in one TV spot.

On most issues, they are closer than either lets on. Both take a tough stance on illegal immigration. (Each accuses the other of being all talk.) Both promise to keep taxes low and foster a business-friendly climate. Perry has backed off an unpopular toll road plan. Hutchison said she would make sure the plan is really, truly dead.

Perry, 59, is the better campaigner -- he is an avid gripper and grinner, where Hutchison is prim and aloof -- and she has suffered by dividing her time between Washington and Texas. Although Hutchison, 66, has spoken of stepping down to campaign full time, her failure to set a date has contributed to a less-than-decisive image. (Her convoluted stance on abortion hasn't helped. Hutchison said at one point that she opposed reversal of Roe vs. Wade because overturning the decision legalizing abortion could lead to more abortions.)

As often happens in three-way contests, Medina has been the beneficiary of all the mud-heaving.

"It seems the longer people are in office, whether it's Washington or Austin, the more out of touch they get," said Mannon Mints, 65, a retired state law officer, who came to see Medina last week at the Victoria Country Club. "They need to go up there and spend a few years and then come home."

Medina's breakthrough came in January, after two strong debate performances. "She was the one who came across, to judge from polls and reaction afterward, as more forthright, better prepared, quite calm and confident," said the University of Texas analyst Bruce Buchanan. "She was seemingly more gubernatorial than her opponents in some respects."

However, success has brought greater scrutiny, and Medina, 47, has not always handled it well. Last week, on Glenn Beck's radio show, she was asked whether she thought the federal government was involved in the Sept. 11 attacks. "Some very good questions have been raised in that regard," she said, declining to take a position. (Medina also questions whether President Obama is an American citizen.)

She quickly issued a follow-up statement disavowing any 9/11 conspiracy, but Perry and Hutchison pounced. An "insult" to Americans who lost their lives, said Perry. An "affront" to America's soldiers, said Hutchison.

Still, Medina has already achieved far more than might have been expected. Failing a successful run for governor, she may be a strong candidate to replace her congressman, Republican Ron Paul, whenever he steps down. Paul, who built a strong anti-establishment following in his quixotic 2008 presidential run, is a Medina supporter.

mark.barabak@latimes.com

Copyright © 2010, The Los Angeles Times