One of the more noxious platitudes foisted upon the
public by our increasingly Orwellian government is "See Something, Say
This saying, of course, differs in no material way from
the sort of propaganda utilized in all the fascist states that have come before.
While this notion of spying on fellow citizens hasn't
yet resulted in the active enlistment of a Stasi-like network of sharp-eyed matrons and meddlesome
old coots embedded in apartment buildings and on each city block to dutifully
report goings-on to the authorities "for national security," can
that be far behind?
But that's not what has gotten sand under my saddle
this week. No, what has irked me to the point of distraction – not to
mention triggering some angry mutterings as I stomp around the house –
could be considered the exact opposite of that trite trope.
What I'm referring to is the modus operandi of
Americans today to see something but say nothing.
More specifically, this week the US government made it
clear that they effectively have decided to adopt a new and very dangerous
interpretation of one of the core principles of the US Constitution, and
apparently nobody cares.
I am referring to a presentation earlier this week by
United States Atty. Gen. Eric Holder at Northwestern University's law school.
Reading from prepared remarks – meaning his words were not a flub-up
– Holder explained the rationale the government is now using when
ordering the killings of American citizens. And I quote...
Some have argued
that the President is required to get permission from a federal court before
taking action against a United States citizen who is a senior operational
leader of al Qaeda or associated forces. This is simply not accurate.
"Due process" and "judicial process" are not one and the
same, particularly when it comes to national security. The Constitution
guarantees due process, not judicial process.
It is important when reading this sort of thing to
separate the inconsequential historical anecdotes – the "here and
now" elements of no lasting importance – from the language related
to setting long-term precedence. To assist you in that regard, I will now
repeat Holder's statement, with the anecdotal elements redacted.
argued that the President is required to get permission from a federal court
before taking action against a United States citizen who is a senior operational leader of al Qaeda or associated forces.
This is simply not accurate. "Due process" and "judicial
process" are not one and the same, particularly when it comes to
national security. The Constitution guarantees due process, not judicial
Simply put, what the administration is now claiming as
standard operating policy is that it can formulate certain procedures on an
ad-hoc basis and call it "due process." Provided their
functionaries follow that process, the government is free to do virtually
anything, in this instance, kill citizens.
Note also that Holder doesn't make a distinction
between targeting US citizens here versus abroad. This is a blanket
When I initially read Holder's remarks, I was sure
there would be a massive outpouring of popular indignation, outrage even. And
I confess to hoping that maybe, just maybe, this would be the final
straw to get the citizenry off their couches to put an end to this long step
down the path of fascism.
But there was barely a peep. No cries for Holder's
resignation, or for Obama's impeachment, either of which would have been
entirely appropriate in a nation where the citizenry hadn't already been
It was also telling that even though Holder's
declaration of the administration's coup against the constitution was
delivered at a law school, the audience didn't rise to their feet in shock
but rather waited politely for him to conclude his remarks before rewarding
him the obligatory applause. Given that these were students of the law and so
should know better, I can only conclude that even though they saw something
– in this case the ungloved hand of fascism – they decided to say
That could be, perhaps, because of another law recently
passed by Congress with an overwhelming 388-3 majority. I refer, of course,
to the Federal Restricted Buildings and Grounds Improvement Act of 2011,
otherwise known as the Trespass Bill.
John Whitehead of the Rutherford Institute writes
intelligently on the bill. Some snippets… emphasis mine.
Bill (the Federal Restricted Buildings and Grounds Improvement Act of 2011)
creates a roving "bubble" zone or perimeter around select
government officials and dignitaries (anyone protected by the Secret
Service), as well as any building or grounds "restricted in conjunction
with an event designated as a special event of national significance."
makes it illegal to enter or remain in an area where certain government
officials (more particularly, those with Secret Service protection) will be
visiting temporarily if and only if the person knows it's illegal to enter
the restricted area but does so anyway. The bill expands current law to
make it a crime to enter or remain in an area where an official is visiting
even if the person does not know it's illegal to be in that area and has no
reason to suspect it's illegal.
In other words, you can be minding your own business
some place when a member of the elite enters, and his or her mere presence
sucks you into their federally protected "bubble" where a single
false move, intentional or otherwise, can end up very badly.
You can read the full article here.
There is, as I always try to point out, much nuance in
all of this. But stepping back to view the larger picture reveals what Holder's remarks so clearly confirm – the nation has
now crossed the line separating a constitutional democracy from a fascist
On flying into JFK last weekend and watching a friend's
middle-aged wife separated from her children in order to go through a
pat-down by one of dozens of TSA personnel, most of whom were standing around
in groups chatting collegially (maybe about their phat
compensation), I felt compelled to turn to my own kids and say, "I hope
that someday your generation will forgive our generation for leaving the
world in this condition for you."
Of course, I am not alone in seeing the signs of
fascism cropping up on an almost daily basis. But at this point the masses
are literally too scared to say something, other than perhaps in quiet
whispers behind closed doors.
Even when the level of fascist control over society is
as blatant as was in evidence earlier this week when a group of very average
citizens gathered to peacefully protest a new law passed by the state of
Virginia requiring women to submit to a government-mandated ultrasound before
being allowed to have an abortion. Fellow Casey editor and Virginia resident
Doug Hornig reports on the action…
happened here is that there was a protest against the bill at the state
capitol, which of course is off limits for such actions. A SWAT team moved in
with full riot gear – there was a long line of them decked out with
opaque visors, tasers, batons, rifles, dogs, etc.
Deployed against about 500 middle-aged women and aging hippie guys. Now
there's a threat to the public order. This is one chilling video. If you want to cut to the
chase, forward to about the eight-minute mark..."
Note that the state police standing watch over this
very pedestrian and entirely constitutional exercise of free speech were
armed with machine guns, once again a clear indication of just how far the
nation's controlling classes – federal, state and local – have
goose-stepped onto the path of fascism.
Sadly, with Pandora's box kicked wide open by 9/11,
feeding into the natural tendencies of the praetorian class to exercise its
might, there is no painless way to go back. Rather, you have to expect that
things will only get worse, especially if there is another "event"
that gives the authorities license to put into action all of the clampdown
plans implemented since 9/11.
Which brings me to an article by
technology specialist and ex-military officer Pete Kofod,
whose articles dissecting the nature of fascism and the growing praetorian
class we have previously published.
As an aside, over the last half a year or so, Pete took
some time away from his busy schedule as the owner of a company specializing
in cloud computing solutions to create a truly unique five-day training
program to help individuals and executives harden their lives against modern
threats. More on that course in a moment, but first Pete's article.
The Race Through the Gate
By Pete Kofod
Envision two horses racing toward a gate that is only
wide enough to allow one to pass through. Now imagine that the horses are wearing
blinders preventing them from seeing each other, virtually oblivious to their
competitor in their quest to get to through the gate as quickly as possible.
The suspense and uncertainty of such a race, were it held, would certainly qualify it as an
exciting albeit rather twisted spectator event. Hopefully the competition
will end innocently with a clear winner, but a more frighteningly possibility
is that it ends with horses and riders horribly injured. As with so much of
that which is attributed to fate, the absolute outcome of whether the race
ends smoothly or in bloody chaos will depend on even the most trivial
component – a divot in the ground, a bird flying across a horse's path,
a hesitation at the starting gun.
Furthermore, the determining cause often ends up being
well within what is referred to as "the margin of error," which in
more common vernacular means that the victory could have gone either way. In
systems engineering, this is referred to as a race condition.
More specifically, a race condition refers to a
situation in which the output of a system is highly dependent on the timing
and sequence of parallel inputs. If the inputs are independent of each other,
a highly unstable environment often develops, yielding an extremely unpredictable
An example of a race condition involves the tale of the
young newlywed couple facing cash shortages at the end of the month. While
awaiting the electronic deposit of her paycheck, the wife writes a check to
pay for unexpected automotive repair. Unaware of this fact, the husband
writes a check to pay for groceries, confident that there is enough money in
the bank. Should their paychecks clear first, all is well and disaster is
averted. On the other hand, if their paychecks do not get deposited in time,
a series of bounced checks will result in inconvenience, embarrassment as
well as a myriad of fees charged by the respective bank and vendors. The
outcome of the race is not known until insufficient-funds notices start
showing up in the couple's mailbox.
The Cultural Race Condition
While it may be a simplification of the circumstances
faced, it can be said that the world is currently experiencing a
"cultural race condition," pitting the forces of liberalization
against an increasingly desperate establishment. The upheaval being observed
is no natural ebb and flow of power transitions. Rather, for reasons that
will be further explored, the dramatic changes witnessed are occurring at a
pace so rapid that existing social and political structures are unable to
reach new positions of equilibrium.
In Lane Number One – The Establishment
By definition, it is the objective of the establishment
to preserve the status quo. Often presented from a position of benevolent
paternalism, preserving the status quo is traditionally accomplished through
the creation of boundaries that are invisible until they are touched. These
"electronic dog fences" are marketed by the established state and
corporate powers as being for the benefit of society. Regardless whether financial,
physical, cultural or informational in nature, in an attempt to keep up with
shifting societal tides, new controls are regularly introduced and
implemented by the establishment, even though most of the populace may be
oblivious to that reality.
A key control technique is to establish boundaries
beyond the interest or perception of the masses. This accomplishes two
objectives. One is that the control measure will be perceived by the majority
as arcane and largely irrelevant to their personal condition. After all, if a
restriction is placed in the realm beyond the daily vicissitudes of life, why
bother expending significant intellectual energy debating its validity?
The second and more powerful consequence is that it facilitates
the marshaling of the majority against "the fringe." Consider the
expression, "If you have done nothing wrong, you have nothing to
hide." This argument is invariably used by the individual who is not
impacted by the boundary established.
An example would be the issue facing American citizens
regarding foreign financial holdings. Reporting requirements and sanctions
imposed for noncompliance stipulated by the US Treasury against non-US banks
has made it exceedingly difficult for US citizens and residents to open bank
accounts outside the United States. As most Americans have not given thought
to such matters, most will dismiss the topic as a matter of concern only to
the financial elite. Many in fact support such restrictions, even though, for
all intents and purposes, they represent de facto capital controls.
The electronic dog fence in this instance is beyond the "roaming
range" of the majority and therefore is not perceived as a boundary.
And in Lane Number Two…
Occasionally, the establishment will be caught off
guard by significant and empowering changes sweeping society. These changes,
typically caused by technological innovations, extend the masses' awareness,
interest and influence into realms previously considered under the
uncontested control of the establishment. Naturally, this results in conflict
as the establishment redoubles its efforts to maintain control.
An instructive case is the debate surrounding the SOPA
and PIPA legislation put forth by the US Congress at the end of 2011. The
purported argument for the legislation was to protect intellectual property
– primarily digital content distributed over the Internet. While
reasonable people can debate the principles and logistics surrounding the
issue of intellectual property, this legislation overstepped by trying to
grant the State very broad privileges to shut down Internet sites even for
allegations of intellectual property infringements. Without delving into the
technical and legal details, it is important to note that the legislation
received so much pushback that the entire affair was dropped. Well, not
really, as it turns out – more on that momentarily.
The case is interesting on several fronts, starting
with how it demonstrates that an issue – in this instance, intellectual
property – can rapidly morph from being a fairly esoteric discussion
point into an almost explosive national issue. Simply, the establishment
failed to recognize in advance that the roaming range of the masses had
already increased, leaving the government feverishly behind and rushing out a
clumsy attempt to install new electronic dog fences.
As for my somewhat cryptic comment above, you may find
it interesting that the US government unilaterally shut down dozens of web
sites the day after SOPA and PIPA were abandoned by the US Congress.
It appears that SOPA and PIPA represented an optional formality.
Back to the point, on one side of the horse race, we
have the establishment, which is working constantly to contain and control
knowledge, thought and action. On the other, we have the unexpectedly
empowered masses who are increasingly aware of, and
resistant to, the government's attempts to curtail their ability to think and
The cultural race condition is afoot.
Communication Constructs as Agents of Change
As mentioned, this cultural race condition, and the
social instability manifested thereby, does not represent a traditional
generational changing of the guard. Rather, the world is facing a
communications-driven cultural shift on a scale not seen in five hundred
years, a shift that has come about from the invention and adoption of
The last time the world experienced a similar shift was
in the middle of the fifteenth century with the advent of Gutenberg's
moveable type print. Gutenberg's invention is credited with being the
catalyst of the Renaissance, the Age of Enlightenment, the Reformation as
well as the Scientific Revolution and expansion of learning to the greater
populace. The existing establishment of the period, largely centered on the
Catholic Church, saw its authority erode in political, scientific as well as
religious matters. These historical movements were accompanied by significant
social upheaval and unrest.
Today we are seeing a shift of similar significance. In
the current instance, the catalytic technology is of course the Internet,
enabled by the introduction of microprocessor-based computing. While most
will agree that the Internet represents a revolutionary technology, to fully
appreciate its transformative power, we need to consider it in the context of
the three laws of the network.
The Three Laws of the Network
The First Law of the Network is Sarnoff's Law,
named after David Sarnoff, the founder of NBC. Sarnoff's Law states the power
of the network is directly proportional to its number of participants. This
law applies to a traditional broadcast environment, regardless of medium. The
model is defined by a single producer of content serving an arbitrary base of
information consumers. Under Sarnoff's Law, information flows only in one
direction, which fundamentally leaves no distinction between the Gutenberg
print press, newspapers, radio and broadcast television. Logistical
efficiencies and the speed that information can be distributed are certainly
factors to be considered, but fundamentally they all represent a one-to-many
The Second Law of the Network is Metcalfe's Law,
named after Bob Metcalfe, inventor of Ethernet and co-founder of the
technology firm 3Com. Metcalfe's Law states that the power of the network is
directly proportional to the square of the number of participants. In this
model, every participant in the network is both a consumer and producer of
information. It is the many-to-many relationship that is its distinguishing
characteristic. Email is an example of Metcalfe's Law – a network with
two email addresses represents a single connection. As additional email
participants are added to the network, the power of the network grows
The Third Law of the Network is Reed's Law,
named after David Reed, an accomplished computer scientist with the Viral
Communications Group in the MIT Media Lab. Reed's Law states that when a
network reaches a certain size, further growth achieves power far greater
than that described by Metcalfe's Law because the contributions of subgroups
within the network become an increasingly significant component of the
overall network. This can be summed up as a "many many-to-many"
arrangement. Perhaps the most prominent example is Facebook. As of December
2011, Facebook had 845 million users. The power of Facebook, however, does
not lie primarily with the user count, but rather with the innumerable
groupings that are formed within the Facebook community.
Twitter provides another prominent example of a network
governed by Reed's Law. During the infamous Mumbai attacks on November 26,
2008, a very clear picture of the events emerged within five minutes via
Twitter. And Twitter continued to provide detailed, real-time updates of all
phases of the event. Traditional broadcast and cable media were never able to
get in front of the story.
Reed's Law allows for complex information to be formed,
processed and distributed almost in real time, pushing the bottleneck of
information to the very source, virtually eliminating the challenges of
distribution as a road block. In addition, it allows for value to be added
throughout the process.
Goodbye Gutenberg, So Long Sarnoff
It can be reasonably postulated that mass media began
with Gutenberg's invention in the middle of the fifteenth century. From the
first copy produced by Gutenberg's printing press to broadcast and cable
television, information distribution and the power that lay therein was
governed by Sarnoff's Law. With the advent of interactive media, largely
driven by the Internet, Sarnoff's Law has given way to media being governed
by Metcalfe's Law and recently Reed's Law. This in turn has resulted in an
erosion of the establishment's ability to maintain tight control over both
medium and message. That erosion is central to the social unrest we are
witnessing in the beginning of the 21st century.
If history is any guide, in the end the establishment
will lose in its attempt to retake control; however, no organism forgoes its
position without a struggle. As traditional institutions are likely to become
unstable, and in some instances collapse, it becomes increasingly critical
that each of us prepare plans and build resources to better weather coming
periods when social institutions experience acute disruptions.
Making it Through the Bumpy Ride
In looking back on the social and political
consequences of Gutenberg's revolutionary innovation, the positive impact on
Western civilization can hardly be overstated. The invention marked the end
of the Dark Ages, a ten-century period beginning with the fall of the Roman
Empire during which virtually no progress was made and the human condition
was generally dismal. That the invention proved to be a monumental step in
the advancement of mankind was, however, of little consolation to the people
caught up in the extreme violence and volatility of that period. Religious,
scientific and cultural pioneers often faced personal and professional
attacks and frequently paid for their leadership with their fortunes and
lives. William Tyndale is remembered for translating the Bible into English.
It was a "crime" for which he paid with his life.
Today Egypt, Libya and Syria are but the most obvious
examples of violent social unrest; unrest fueled by the paradigm shift of the
Internet and Social Media. The yet unproven advances in the human condition
many expect to see materialize in these places provide little relief to those
who will lose their property, livelihood and lives during the transition. In
the process of greater advances, it is easy to become collateral damage.
Volatility impacts "bystanders" as much as active participants during
"Keep Your Head Down and Your Powder Dry"
While Oliver Cromwell's famous admonition should always
be considered sage advice, it is especially warranted during periods of
widespread volatility. Today that advice should be considered in the context
of ensuring personal safety, safeguarding financial resources and maintaining
access to current information that either provides immediate actionable
guidance or helps establish an emerging trend that can be used for predictive
This is an iterative process, demanding regular if not
continuous vigilance against existing and emerging threats. This requires
committing to continuously seeking trustworthy sources of information.
Fortunately, Reed's Law, and technology based on it, allows for rapid
cross-pollination of ideas. Focused sources of information can be rapidly
processed and reassembled to help in making specific decisions, a concept
that is called content "mash-up."
It is inadequate to exclusively rely on monolithic
traditional information sources, such as those still operating under
Sarnoff's Law, many of which are unduly influenced by the establishment and
so are no longer to be fully trusted.
The first of the three alleged Chinese curses proclaims
"May you live in interesting times." By every measure, it would
seem that we do. The period just ahead will be defined by opportunity seized
and opportunity lost. How you personally make out during the transition will
largely be a function of your willingness to remain current with the societal
transformations taking place. In other words, only by dedicating a portion of
just about every day to assemble relevant and timely information will you be
able to properly assess and manage your exposure to risk.
The steps you should take to protect yourself include:
- Understand and participate in social media. It will initially serve as an
early warning system to opportunities, threats and risks. In time, it
may be the only warning system. Stay on top of it. While contributing is
optional, participation is becoming mandatory.
- Recognize that social unrest can happen anywhere,
including "here." During social unrest, the government is not your friend. Their
objective is to restore their order. Think Katrina. Diversify
your life, including physical and financial assets, so you can safely
sit out the mayhem. Start planning now. There may come a time when it is
- Assess your geographical environment as it applies
to your physical safety. Large metropolitan areas and economically marginal communities can
quickly descend into upheaval should basic life support systems fail.
Develop the skills to protect yourself, your family and your property.
- Recognize the increased significance of your digital
life and take meaningful steps to protect it. Governments will increasingly seek to control and
monitor your digital life. Develop and maintain the skills to protect
your digital identity – it is inextricably linked to your physical
and financial well-being.
- Don't go it alone. There are a lot of complexities afoot in the
world today, and trying to process all this information on your own is
almost impossible. By teaming up with other individuals you know and
trust, and sharing resources, you can enhance awareness and improve your
capabilities in planning should the sorts of serious changes that we
could see come to pass during this transitive period.
These are but a few steps you can take that will serve
you well and likely put you ahead of your peers. By keeping your head on
swivel and regularly updating your fall-back plans,
you can get on with enjoying your life, create value in your chosen field of
endeavor and not worry about becoming the horse that doesn't make it through
Pete Kofod is the founder and
president of Datasages (www.datasages.com),
a technology services firm that offers cloud computing and strategic
technology services to various private organizations. Before entering the
technology sector, Pete served with the US Military, both in the United
States and abroad, where he forged many close friendships that still thrive
Pete is a property owner at La Estancia de Cafayate in Argentina and enjoys a variety of outdoor
activities including tennis, skydiving and hiking. His most recent adventure
is pursuing his private pilot's license. Pete is married and homeschools his
Pete's latest initiative involves creating Theia
Global, an organization dedicated to helping individuals and business
executives manage modern threats. Pete can be reached at firstname.lastname@example.org.
David again. I wanted to say a bit more about Pete's
course. Last year, while at one of the owners' gatherings in Argentina, Pete
shared with me his long study and interest in identifying proven
methodologies to plan and prepare for the threats present in modern times.
The basic concept revolves around creating a
foundational plan to protect your assets, your data and privacy, even your
personal security against the most obvious current threats, then continuing
to create cascading contingency plans should something occur to render your
initial plan insufficient.
To put this into context, let's say that as inflation
protection you have invested a certain percentage of your portfolio in gold,
but one day it becomes apparent that the government is preparing to confiscate
gold "in the national interest." Most gold owners wouldn't have a
specific back-up plan in place; Pete would.
Or, to be more dramatic, most people have failed to
even contemplate the potential consequences of another 9/11-level attack
– or even widespread Arab Spring-type protests fueled by social media
– let alone plan to avoid the consequences on your business or your
life of a government backlash that could literally shut down transportation,
the Internet and worse. In other words, if today's softer, gentler form of
fascism becomes dramatically less so, most people would be caught completely
unprepared – very much not the case with anyone familiar with Pete's
I was so impressed with Pete's understanding of the
process of actively preparing for the unknown and unknowable that I asked him
if he would present his methodologies in a workshop at our upcoming Casey Research Recovery Reality Check Summit
in Weston, Florida, April 27 and 29 (registrations are going fast).
It's also why I was so happy to learn that in the
months following our discussion in Argentina, Pete put his interest into
action by organizing a five-day, hands-on training course at the famous
Virginia International Raceway.
The focus of the Foundation training program is
to provide you with a foundational course in how to effectively plan for and
protect yourself and your family against modern threats.
Specifically, over the period of June 11-15, Pete,
assisted by a hand-picked team of instructors, will teach you everything you
need to know to enhance your personal-protection skills, understand and
deploy best practices in cyber-security and privacy, and diversify
Reviewing the schedule, what this entails is a
confidence-boosting mix of skill-building in everything from protecting your
privacy and data from online threats (you'll leave with the necessary
software installed), to firearms (with instruction by former members of the
highly trained Delta Force), to evasive driving (taught by instructors to the
Diplomatic Security Service, the best in the world), to internationally
diversifying your assets and your life (with specific steps and contacts for
establishing overseas accounts, second residencies and passports). Pulling it
altogether are interactive lessons designed to leave you with a solid
understanding of how to plan for pretty much any contingency.
In any event, I have reserved my spot, and there are
only a total of 27 slots available, so if you are interested, you might want
to do so yourself. Now, I have to warn you that at $7,900 per registration
this course is not inexpensive, but compared to the value of what you are
trying to protect, it's almost inconsequential. And, as Pete explained it to
me, the costs of putting on the program are extremely high, therefore the
price tag… because the fee is all-inclusive, meaning it covers your
hotel room, all meals, transport from the Raleigh-Durham airport, a high
instructor-to-student ratio (with some of the best instructors in the world),
all equipment and even evasion cars that invariably take a beating during the
In any event, I'm a big fan of Pete and think that he
is completely right in his thinking that taking five days out of all the days
in your life to get prepared, and to learn to build plans to ensure you
always stay prepared, makes a lot of sense. Details on the course, which goes
up in price on April 20, can
be found here.
Added Thoughts on the Race Condition
Before moving on to other matters (sorry, I appear to be
running a bit long today), I want to quickly follow up on the key point of
Pete's article. Namely the establishment's well-documented fear that social
media will be turned against it, just as it was in Egypt, Libya, Tunisia and
The power of social media was once again made clear by
a recent campaign against a small-time warlord, Joseph Kony,
mounted by the Invisible Children organization with the specific purpose of
targeting him for arrest or summary execution, therefore setting "a
precedent for international justice" (in their words).
Even though the video you
can watch was only uploaded about a week ago, it has already received
almost 53,000,000 views – accomplishing the goal of making Kony enemy #1, with his face splashed across all the
world's media outlets. Want to bet that we will soon learn that Congress is
calling for special hearings to decide what to do about the guy? Or that political candidates will soon be calling for drone
All well and good, but don't kid yourself – the
power elite is watching these developments with much the same frame of mind
as a tourist on a walking safari watches a pride of lions from what they hope
is a safe distance.
Think about it. That 53,000,000 people could be moved
to not only watch the Kony videos, but that a vocal
subset of that number then organized in the equivalent of flash mobs in
schools and communities to lend their active support to his downfall…
around the globe and all in the space of about a week, has got to be
eye-opening to the powers-that-be.
In one real sense, social media provide global access
to the equivalent of a societal nuclear bomb. All that's required to set one
off are the modest skills necessary to deploying it.
So, how long do you think it will be before a major
Western government – maybe even the US, or specific US politicians
– become the target?
Want to see a really cool straw in the wind? Check out these videos put together by the folks at MTV. They are a
stunning condemnation, and an effective warning, against the encroaching
police state in the US.
Those videos show there might yet be some hope for the
next generation. So far, they have only pulled 480,000 views on YouTube, but
who knows – maybe they'll catch on. (And, yes, please pass this along
so others can watch them, too.)
But if you are a member of the praetorian class whose
job is to protect the status quo, the powerful potential of social media to
effect political change – quickly and even violently, if you take
what's going on in the Middle East as an example – has to be very
So, I think that Pete's got it completely right –
that the race is on, and that it has the very real potential to get quite
ugly before whatever comes next makes it across the finish line.
While vigilance is required to not get caught on the
wrong side of things, there's also a big upside in all of this. That's
because it's just a matter of time now – certainly within the lives of
most of us, judging by the speed of adoption of the relevant technology
– that we are going to see a new paradigm in government, one that
tosses over the equivalent of government operating on the outdated model of
Sarnoff's Law, to one based on something closer to Reed's Law.
Which brings me to a great quote that
Doug Casey used in closing out the just-released edition of The Casey
When you see
that trading is done, not by consent, but by compulsion.
When you see that in order to produce, you need to obtain permission from
men who produce nothing.
When you see that money is flowing to those who deal, not in goods, but in
When you see that men get richer by graft and by pull than by work, and
your laws don't protect you against them, but protect them against you.
When you see corruption being rewarded and honesty becoming a self-sacrifice – you may know that your society is
–Ayn Rand, 1958
Society as we know it is doomed, and as Holder's speech
so chillingly revealed, it is degrading quickly. That raises the possibility
that the new media are going to turn their guns on the status quo in the near
While I was fairly derisive in my critique of Occupy
Wall Street, and I stand by my observations, I suspect that given the widely
distributed nature of the media, what's next will almost certainly be a
derivation of the mindset of the people behind that movement. Which is to say highly socialistic in nature, with all the
attendant consequences for the economy in general and for those of us who
value individualism most highly.
In that we really can't foresee how things are going to
unfold from here, you might as well go happily about your life – just
don't forget to make like the ant in the Aesop's famous fable and prepare for
the transition that's now under way.
(Ed. Note: As just referenced, the March edition
of The Casey Report – our big-trend
analysis with specific investment recommendations to play those trends
– was published last night. You can read it today, and for the next
ninety days, without any risk or obligation.)
Moving right along, I want to share some observations
on inflation from a UK-based correspondent who has granted me permission to
repost the following on the condition that he remains anonymous.
Inflation in the UK
By Anonymous (no, not that Anonymous)
Some observations, and some
more comprehensive answers to your questions.
I'm guessing that by now you've realised
that I live in something of a bubble.
But it can also be helpful, because I notice things
that might otherwise be perceived as incremental changes by other people. I
also don't cook, so I rarely go to supermarkets. In fact, I'm not allowed in
the kitchen, except to make tea and go to the fridge.
But during my recent sojourn in London, I was forced to
fend for myself, and so the anecdotal evidence of rampant inflation in the UK
IMHO: We have a published rate of inflation (3.6%) that
bears about the same relationship to reality as the published rates of
inflation in Argentina. Part of the problem is that the pound sterling has
been devalued by about 30%, and we are so dependent on imports.
UK Inflation Rate Falls to 3.6% in January
The fish I paid £8.99 a kilo for a year ago is
now selling for £14.00-£18.00 a kilo (the same fish, in a
supermarket, not a posh fishmongers).
Four years ago, I bought a white mohair throw from The White
Company. It was very nice and cost about £60. Recently, I saw another
one, a silk blend, in the same shop. As I am fond of soft, fuzzy, comforting
things and it was about twice the size, I thought I'd have that as well. It
was £250. Now, I don't know of any mohair shortages, and last I checked
the silkworms were working for less money, not more. By all accounts, it
should have been... um... £120? Call it £150. But not £250.
Both imports, by the way.
Onwards to public transport, the only real way of getting
around London with any efficiency. The last time I rightfully recall buying a
Transport for London Travelcard, it cost
£5.50. Last month, it was £8.40.
Tube and Bus Day Travelcards Rise By up to 74%
I don't make any of this 3.6% (the published rate of
inflation). Not even compounded.
In fact, when I go out, I've been looking for things
that have increased by only 4%. Can't find any. Not our energy bills. Food is
an easy 30%. Transport and petrol, well, see above and below.
The disconnect between government's inflation statistics and reality
is, of course, not just a UK or Argentine phenomenon – but pretty much
universal. According to ShadowStats (whose founder
and president, John Williams, is also on the faculty for our Recovery Reality Check Summit), the real rate of
inflation in the US at over 6% is better than twice the official rate. But
that's no surprise to anyone – not when even a modest dinner out for
two costs $75 to $100.
This disconnect tells me two distinct things:
- Governments are unafraid of deliberately trying to
deceive the public.
- But they are very much afraid of getting real
about inflation, as that risks shacking politician-friendly loose
monetary policy. As they should be, because once interest rates start
rising – as they absolutely will when higher rates of inflation
are widely recognized – the economic and political backlash will
Of course, the game can only last for so long. Precious
metals are just one of a number of tools you can use as part of your
portfolio preparations – but even if you only use that, you will be
well ahead of the crowd. Which, for the most part, still
doesn't understand the role gold and silver play in preserving capital over a
long period of time.