Unfortunately, I'm Going To Right About The Housing Market - Again

Home prices, as with aggregate wealth, only really ever increase at the rate of population growth.  So if the population of households and home owners is actually declining, as it is today, what does this imply for future home price appreciation and personal wealth?  - Alex Pollock, Resident Scholar - American Enterprise Institute

Fortunately, if you have not been unfortunate enough to get sucked into buying a home in the last 12 months at these QE/Cheap debt-fueled prices, consider yourself better off.  If you have a house you are trying to sell and want to really sell it, do it now and price it to move.

DR Horton, the nation's largest new homebuilder  reported its Q4 and full year results two days ago.  I pulled up the SEC-filed financials and dug into them a lot deeper than any Wall Street analyst does, or at least presents to the public.  What I found was quite troubling, especially considering that DR Horton is the best possible statistical representation of what is going on fundamentally because it's the largest homebuilder and caters to the middle to lower-middle market demographics.

Keep in mind that headline reports only offer year over year comparisons which, given the amount of QE and Government stimulus pumped into the housing market over the past 3 years, is an easy beat.  But I have been analyzing quarter to quarter comparisons for the homebuilders' last two quarters through September because they incorporate the 6 best home selling months of the year on a seasonal basis.  The drop in numbers from the June quarter to the September is quite startling, and so far it's been across the board with the companies who have reported.

As an example, DR Horton's new order backlog dropped 17% from its fiscal Q3 to Q4 this year.  Please note that its fiscal Q4 includes July and August, which are typically the 2nd and 3rd best seasonal months for sales, so one would think that at best case DHI's orders should have been flat.  It's cancellation rate spiked up to 31% from 24% in Q3.  That's big.  The market was expecting a 25% cancellation rate.  The list goes on.   You can read my article here:   Red Flags All Over DHI's Earnings Report.   You will also note that DHI's management has been very heavy sellers the stock this year, especially compared with the scant number of buys - one to be exact in the last 12 months.

If you want to see the true fundamentals underlying the housing market, here it is in 3 graphs - these graphs tell us that the economy is not generating jobs and income to even come close to supporting growth in the housing market - in fact, it's telling us that the housing market is getting ready to drop hard again (please click on the graphs to enlarge):

(Read median household income)

(Home ownership rate in the U.S.)

Either a substantial amount of QE is coming in order to prop up this mess, or the housing market - and the stock market - are set up for a bigger fall than we saw in 2008.

The Stock Market Has Become Insane

Common calculations of aggregate ‘wealth’ take the entire stock of an asset class and multiply it by the bubble prices, on the theory that financial value is what you can sell something for.  Of course, some clever or lucky individuals succeed in selling at the bubble highs, but the aggregate bubble prices can never be realized by sale.  As soon as any very great number of the owners of a bubble asset try to sell it, the bubble collapses, the evanescent “wealth” disappears, and the long-term trend reasserts itself  - Alex Pollock, Resident Scholar at the American Enterprise Institute

I was chatting with someone earlier about how the current market reminds me of the tech bubble in 1999-early 2000.  The NASDAQ peaked a little over 5,000 in March 2000.  There were maybe a few lucky souls who sold at the top but anyone else who claimed to do so is lying to cover up the accidents in their 401k's.  Then I looked to see where the Naz is right now and I discovered it was a shade below 4,000.  I stopped watching the Naz a long time ago because it reminds me of the penny stock markets in Denver and Salt Lake of the 1970's.  Mostly fraudulent.

Then I looked for comparative purposes at the S&P 500 futures, as I was watching it ramp higher today unceasingly in the last hour to close up over 13 points (close to 1%) despite opening the day down about 9 points.  No news or fundamental reason for the ramp.  Unless you consider the Federal Reserve's money printing program to be of fundamental value.  Hmmmm, let's see.  The Fed issues 1 dollar and it's a one banana world, so it costs $1 to buy the banana.  Then the Fed issues another dollar but there's no more bananas produced and I'm hungry so the guy who has the banana charges me $2 dollars.  I felt wealthier when I had $2, but it still cost me $2 to buy the banana.  That's an absurd simplification, but that's basically what the Fed is doing.  You call that value-added?  You call that wealth creating?  In it's most simple-to-understand form it's "inflation."

We might not see the immediate affects of inflation tomorrow when we go buy food at the grocery store, because those dollars being printed are piling blindly and foolishly into the stock market.  Why?  Because the demand for mortgages for buying homes and refinancing existing mortgages is quickly disappearing, so all that printed money has to go somewhere. It was previously going into cheap mortgages used to buy homes to flip.  That game is over now.  The housing bubble is popping. Here's where the money IS going:

If you think there's any semblance of fundamentals driving this market other than massive quantities of Fed "cheese," then please review the graph I posted on the upper right side of this blog.

Now, for those of you who think that you'll have the discipline to hold on until this thing peaks, then I will tell you that in 1999 when the Naz was at 3000 and I thought that was the peak, it ran up another 66% from there.  Could that happen with the SPX?  Sure.  But also know that in January 1923 the German stock market index was 21,400.  By November 13, 1923 it had run up 26,890,000.  Don't blink or rub your eyes, you can look it up.  Then on November 14, 1923 the German billionaires woke up and found themselves destitute, as the German Government revalued the mark at 1 for 1 billion.  Your billion in the stock market was now worth 1.  You didn't even get a chance to sell.

Don't think that won't happen here, because it can and probably will.  And you better pray that's how this grand Keynes/Volker/Greenspan/Bernanke/Yellen experiment turns out, because the alternative is that the U.S. starts a world war (we've heard that before, twice when Germany ruled the globe) because China is the country that forced the revaluation of the dollar.  If you want to see how that ends, read "The Road."  Just remember:  Arbeit macht frei...

Retail Sales Confirm That Economy Is In Trouble - Twitter Already In A Bear Market

Just a quick "administrative" note first.  The homebuilder stocks took a big hit on Friday despite the massive ramp in the Dow/S&P 500.  At one point the homebuilder stock index was down 4%.  I have called a new bear market in housing when the DJUSHB (Dow Jones Home Construction index) hit 515 at the end of  January.  It's trading down another 1% today as I write this.  It's down 20% even from my call on January 29.  You can read about my call here:  Short The Housing Stocks.  That piece focuses on DR Horton and why that's a great short. You sort through my other articles to catch up on my housing market analysis.  I was a bit early on my call as the DJUSHB ran up to 550.  But that just means that the index has been in an even bigger bear market (the 20% decline rule) than measuring from when I made my initial call.  Then again, I was early in calling the demise of the first big housing bubble, but ultimately I proved to be 100% right.  History will repeat here, I assure you.

Also, I am still waiting to hear back from Pulte Homes' Jim Zeumer, who jumped all over my analysis of his company's accounting management techniques and responded promptly to my email replies. That is, all but the one in which I challenge he and his upper management team to take after-tax income cash from their bank accounts and buy a meaningful amount of shares if he was so confident that my work was wrong.  You see, PHM insiders sold copious amounts of stock all summer long and the company used $83 million shareholder money to buy back shares.  So why isn't management buying shares if they like the outlook for new home sales?  Please note, I don't expect to hear back from him and that was a strictly rhetorical question.  But I will say that it's always best to invest in companies/sectors where management is putting their money where their mouth is.  We are seeing that in a big way in junior mining shares.

So, retail sales are starting to decline on a week-to-week basis, which is contrary to the bullish headline year over year reports.  I wrote an analysis of retail sales for Seeking Alpha, which you can read here:  Retail Sales Tanking/Retailers Sending A Bad Signal.

It's incredible to me that these big retailers are going to open on Thanksgiving Day, starting with K-Mart opening at 6:00 a.m.  It's bad enough that Walmart started the trend years ago by opening at midnite on Black Friday.  But if you step back and think about what it means, it means that the retailers are fearful about the prospects for holiday sales this year.  Abercrombie & Fitch has already warned about their holiday sales expectations and The Gap is already heavily discounting.  That's about all you need to know because the cash register is where "the rubber meets the road" of truth - not media-hyped headlines and Wall Street financial tv "news" programs.

Twitter stock, which came public at an insanely high multiple of sales and is highly reminiscent of what happened of the top of the last internet stock bubble, actually hit bear market territory this morning as it traded over 20% below it's high price print on Thursday, the day it came public.  Of course, I'm sure CNBN, Bloomberg and Fox Biz will not report this fact...

I'm Not Sure How The Government Can Report GDP And Payroll Numbers This Absurd And Expect Anyone To Believe Them

Just when you think things can’t get any more ridiculous, magically they do. Your country’s revised GDP number is an insult to the intelligence of anyone with an I.Q exceeding that of a gerbil.  My conclusion is that there is something horribly wrong in the overall system and the powers- that- be are trying to groom things prior to the revelation of the truth.  -  A well-known Investment Strategist in private correspondence with me yesterday (private except for NSA surveillance)

I was going to write out a detailed analysis of yesterday's "advance GDP estimate" for Q3 and not get into the employment report number just released today.  But today's jobs gain report for October was so absurd that I'm not really sure it matters the extent to which the details are dissected and analyzed for credibility because the headline print for both numbers is so unbelievable that it would stretch the imagination of history's greatest fiction novel writers to come up with them.  When you write fiction, you have to give your audience some small thread of a reason to "suspend disbelief."   But the GDP and Non-Farm Payroll reports are just too inconsistent with just about every private survey on the economy to allow even for the temporary suspension of disbelief.

I almost feel like I would be insulting the intelligence of the reader to dive into some of the most troubling sub-components of the headline data because the headline numbers themselves are just too absurdly beyond credibility.  Here's what John Williams of Shadowstats.com, who's collected, analyzed and written about Government economic reports for decades, has to say about the GDP report:

The GDP remains the most-worthless and the most-heavily modeled, massaged and politically-manipulated of government economic series.  It does not reflect properly or accurately the changes to the underlying fundamentals that drive the economy.

Just briefly on GDP:  Yesterday's 2.8% headline number - and remember this is a "seasonally adjusted annualized" number - included .89% which was attributable to inventory build.  Now, we know most big manufacturing firms are posting flat or declining revenues, which means end-user demand is declining.  So I'm not sure why businesses would be building inventories, especially since the inventory build added .5% to Q2's GDP print.  Why they would continue to build even more of something that no one seems to be buying is beyond logic.  I explained this dynamic with regard to automobile sales reported for October, which you can read about here:  Misleading Auto Sales Report.   I will say that the GDP headline number was 50% higher than Wall Street was expecting and most of that 50% is comprised of this inventory build.  No one expected it because it doesn't make sense to anyone based on the true fundamentals of the real economy.

But then again credit is free right now and it doesn't cost them anything to borrow in order to finance the inventory build.  What this does mean is that at some point, probably in Q4 and Q1 next year, businesses will have to cut back and that will subtract from GDP.  If you subtract the inventory build from GDP, you get a 1.8% number.  The inflation index was 1.9%.  If you subtract the effect of inflation from the nominal GDP number, it means that ex-inflation and ex-inventory build, GDP actually contracted on a real basis.  That's a recession and an economic recession is consistent with just about every non-Government economic and consumer report available.

As for today's jobs number.  I'm just not sure how that headline print has any kind of credibility whatsoever.  I was just informed by an esteemed colleague that the birth-death model (that fictitious job creation device the Government uses to make jobs appear out of thing air)  added 126,000 jobs - the most of any October going back to 2003.

Furthermore, buried in the Government's own report is a statistic that shows that 935,000 people dropped out of the labor force.  Where did they go?   They applied for and now receive some kind of Government support:  Welfare/food stamps - the welfare rolls grow by the thousands every month - the last number I saw showed close to 50 million people receiving food stamps; Social Security Disability - Obama liberalized the qualification hurdle for SSDI and there's 11 million people receiving it now vs. 7.3mm when Obama took office - that's 3.7 million more people than in December 2008 - a 51% increase;  people who can't find jobs have no problem getting student loans to go to schools like DeVries and University of Phoenix, where they learn how to change hub caps and paint fingernails - when you get a student loan and go to school, you drop out of the labor force - student loans and auto loans made up 99% of all non-mortgage loans received in the last 12 months.

That's where most of the nearly 1 million people went last month who are no longer considered part of the job market.  The rest just disappear down the proverbial rabbit hole.  But the labor force participation rate is now under 63% of the population.  It's where it was in 1978 when most households were still one-worker homes and women stayed home to raise the family.

One last point about how absurdly fraudulent these Government reports are and I have not seen this mentioned yet in any analysis.  If you look at a breakdown of the GDP report in terms the change of the components from Q2 to Q3, you find that consumer spending, service spending, fixed investment and exports all declined in terms of subtracting from the growth rate as calculated.   Think about that for a minute.  How can private businesses be hiring people if consumers are spending less, service businesses are seeing a decline in demand and capital expenditures are declining?  It just goes to show you what an insult to our intelligence these numbers are.

I will end with one note, which I believe signifies that my analysis is 100% accurate.  I have been bearish on the housing market for many reasons.  You can read through my articles posted on Seeking Alpha to see my analysis which is backed with hard data, starting with this one:  The Housing Bear Is Back.  Well today, despite the massive ramp higher in the Dow and the S&P 500, the Dow Jones Homebuilder Index (DJUSBH) is down 3.4%.   That's a big drop for any day in that index, but on a day when the broad equity indices are up nearly 1%, it is sending a very ominous signal about the economy.  After all, if the economy is doing so well per the Government reports today and yesterday, how come the housing stock index down 25% from its high print early this year?  If the mark of a bear market is when a stock or an index drops 20%, how come no one in the financial media - or even ANY analysts besides me - are not talking about the new bear market in housing?  The housing mini-bubble has been about 80% of any economic strength over the last 2 years.  That is now gone.

Have a great weekend.  Enjoy what you can, as much as you can, for as long as you can - there's no telling when we'll wake up a the collapse.

The U.S. Government's Totalitarian Creep Is Turning Into A "Grip"

I first want to preface my remarks by saying that, although Obama has tragically and immorally failed to deliver any of the promises on which he rode into the Presidency in 2008, it's not his fault.  He is nothing but a pawn, maybe at best a bishop or rook, on the insidious chessboard of political and economic power and control that is dominated by big bank, oil, defense and other corporate interests and long time elitists like Henry Kissinger and Zbigniew Bryzezinski.  Many of the rooks and "royal" players do not have identities because they stay behind the scenes.  But many you've heard of, like Robert Rubin, George Soros and Warren Buffet.  The person who gets put in the charge of the Fed is also a lower-ranking piece on the board, like the President.  This is not about Democrats vs Republicans - that's the distraction they throw out like fish bait to deflect your attention from the real story.  Behind the scenes the big monied interests donate equally to both parties.  They don't care which party fills the seats as long as they control the votes.

Another piece of the overall puzzle fell into place for me when I chatted with a good friend of mine today who was going home from a hedge fund conference.   He said the majority of people there were completely disgusted with our markets and the big buzz was about how the markets are completely out of touch with reality and that it was impossible to value anything.  As an example:  Sovereign Ghana bonds are yielding only 7%.  Ghana for chrissakes. That's a lower rate of interest than many muni bond issues in this country.  They were also disgusted and mystified by the relentless move higher in the U.S. stock market.

He also said that people were talking about how big Wall Street firms were starting to withdraw from trading a lot of markets, especially commodities because they are impossible to trade, so it's not just gold and silver.  As participants and capital leave markets, they become less liquid.

That's when it occurred to me:  this is what the Government and elitists who control the Government want.  To the extent that markets are liquid and freely trading, it's harder for the Government to control them. 

Let me explain this control thing.  I've noticed since the Patriot Act was passed that the Government has been slowly taking away civil and Constitutional rights and taking more control of our lives.  It happened somewhat slowly at first but it's starting to happen very quickly now.  Obamacare is a prime example.  Obamacare is going to "blow up" - doctors are opting out en masse, there will be a shortage of doctors to service patients in the system and many people will only buy insurance when they have to because pre-existing conditions must now be accepted. etc etc.   It will give the Government the perfect excuse to consolidate even more control over our lives by moving the role of healthcare management into the Executive Branch of Government.  All it will take is yet another Executive Order signed by Lefty (for those who never noticed, Obama is left-handed, I'm ashamed to say as a lefty).

Same deal with the markets.   In July the average NYSE volume per day was 952mm shares.  It has declined at a remarkable rate.  Yesterday NYSE volume was under 700mm shares.  It's that way below that on many days.  It's easier for the Fed, with the big banks as their proxy, to keep the market from tanking when the volume is low.  When volume is low a $1.8 billion QE operation like today is all it takes to keep the market from cliff-diving, which it started to do at the open, until the Fed was done with its POMO operation (QE bond buying - today it bought $1.8 billion of 30yr Treasuries).

If the Government can force liquidity to withdraw from the markets, it makes it easier for it to control the markets.  Here's what this means with gold and silver:  Gold and silver have been under oppressive price-capping manipulation since peaking in 2011.  The price of metals were a run-away freight train back then and it was getting to the point at which the dollar's "supremacy" was threatened.  Gold and silver bottomed in June and have been slowly drifting higher, despite daily paper bombing attacks from Australia, London and the Comex.  The underlying strength of the physical market in the eastern hemisphere is preventing them from pushing the metals lower other than an occasional blatant paper raid, typically on Friday when the Comex is the only game going around the world.  From here, I believe gold and silver will start to "leak" higher as we get closer to the tipping point for the U.S. dollar.  At some point the paper manipulators will receive delivery demands that can't be met.  At that point in time gold and silver will go bid without, the dollar collapses and our system implodes.  I don't know how long that will take, but I see that the Government's pace of implementing totalitarian control is moving along a lot more quickly now than it was 10 years ago when I first starting thinking about the end game.

Here's some more unmistakable signs:  1)  The debt ceiling limit is removed, supposedly temporarily.  The jury is out on the "temporary" nature of that - I bet the "no ceiling" status gets extended in February.  No debt ceiling limitation essentially gives the Government its own printing press  2)  Capital controls.  Many are poo-poo'ing JPM's move to limit the ability of depositors to wire money in and out of the country, but I have read that other banks are going to follow suit and I would bet big money that it's a "creep" toward capital controls.  3) NSA.  Diane Feinstein surveillance legislation - need I say more?

There are other signs but those are the big ones.  Whether my overall scenario for how the exact events unfold is accurate or not is not important.  I am becoming more convinced that my thesis is correct.  It doesn't have to be accurate for things to become unbearable here, just correct.  After all, "1984," "Animal Farm" and "Atlas Shrugged" are not necessarily "accurate" in their portrayal of the unfolding of actual events but they sure are correct in their underlying modelling of what has been happening and what will happen.

This is a concept that anyone who has kids, or even only grand kids they care about, can't accept because the implications of what it means about where life in the U.S. is headed are too horrible to contemplate.  Denial sets in and fears are rationalized away as being "irrational" and those "irrational" fears are replaced by hope.   The only "hope" I have right now is that Cormac McCarthy's "The Road" is not only not accurate but not correct.

How Much More Gold Can They Drain From GLD Before It Loses All Credibility?

                                                    

And thus I clothe my naked villainy
With odd old ends stol'n out of holy writ;
And seem a saint, when most I play the devil

           - Shakespeare, "Richard III"

We have witnessed a stunning drain of gold from the GLD ETF trust.  Through last Friday, an incredible 479 tonnes - more than 35% - of GLD's gold has been removed and has disappeared, most likely to Asia - in the space of about 10 months.  The biggest chunk of that 479 tonnes was removed shortly after Germany's Bundesbank issued it's feeble and hopeless request to the U.S. that the Federal Reserve start shipping back some portion of the 1500 tonnes of gold that is supposedly being "safe-kept" on behalf of Germany by the Fed in its vault in New York City.   Gold luck, Angela...

I have looked at GLD suspiciously ever since James Turk issued the first analysis of GLD's prospectus back in 2004.  Those of us who are familiar with securities laws and investor "safe guards" supposedly enforced by the SEC were absolutely shocked that the SEC approved the GLD prospectus as it was filed because of the egregious lack of GLD sponsor and custodian legal accountability standards typically required by the SEC for publicly traded securities.

Given this fact, I believed at the time that GLD was a scheme devised to suck  in retail and institutional cash that might otherwise flow in massive quantities into actual physical gold that would be safe-kept in private vaults in this country.  Although GLD has a mechanism to enable investors with a minimum of 100,000 shares to convert those shares into gold that would be delivered to the investor, the procedure is exceedingly cumbersome and expensive and there's a mechanism embedded in the language of the prospectus that enables the trustee of GLD to deny such requests.

But I also knew - through GATA's invaluable research - that there would eventually be a shortage of physical gold that would be available to allow the western Central Banks and bullion banks to maintain their oppressive and incessant manipulation of the paper gold market for the purposes of maintaining a cap on the price of gold, for the purposes of defending the credibility of the U.S. dollar.  I figured that at some point the gold in GLD would used for this purpose once the Central Bank stocks of gold were largely if not fully depleted.  In this context, please recall that about three years, the ECB system, which had been selling 400 tonnes per year on average, pretty much stopped selling any gold.  That's sign-post #1 that I was right.

Then along comes the Bundesbank in early 2013, with a request that the Fed start shipping Germany's gold held in in New York back to Germany.  That's when all hell broke loose:

(Please note:  the original graph is from the TF Metals Report. I sourced it from my esteemed colleague, "Jesse," of Jesse's Cafe Americain.  Solid circle edits are mine to enhance visual readability of the chart.  Jesse's original post can be read here: Collapse in GLD gold holdings).

There's something really wrong with that picture because the intuitive response from the market by Germany's request of the Fed should have been a quickly rising price of gold.  But as you we all know, the Fed defaulted on the request - for all intents and purposes - and that's when the massive drain of gold from GLD commenced. 

The truth is that my original hunch was correct.  100% correct.  The gold in the GLD trust is being used to satisfy the enormous physical delivery demands from China and the other big gold buying countries because the western Central Banks have run out of gold to deliver.  That is an unmistakable fact. Reports and data ad nauseum have been published in the last six months describing and verifying the voluminous, unprecedented amount of gold bars that have been moved - literally physical transferred - from the Comex in NY and  the LBMA and Bank of England vaults in London to Switzerland and then on to Hong Kong, where it flows to its ultimate destinations in China.  Anyone who would deny that this is the case has a blatant and catastrophic disregard for the truth as supported by provable facts.

So the question is, how much longer can the depletion of gold from GLD continue before this scheme falls apart?  Let me first say that it is likely that the U.S Government's "Waterloo" in this situation will be the gross miscalculation - when GLD was originally devised - of the growth and size of China's appetite for physical gold for which actual physical delivery is demanded.

With that in mind, my best guess is that if the gold in GLD were to be depleted by another 35% from here, the largest remaining shareholders of GLD would likely start exercising their legally ambiguous "right" to convert their shares into physical gold and have that gold delivered out of JPM's custodial vault and into their possession.

Think about the Hobson's Choice faced by the sponsor, trustee and custodian of GLD:  if they don't honor shareholder conversion requests to convert and deliver gold, it will send the "default" signal to the world that indeed GLD is a fraud, that GATA has been right along.  The price of gold will literally go straight up, "bid without"  - meaning huge bids will appear at much higher levels and there won't be any offers.  The other side of this "choice" is that it is likely that the physical gold - at that point in time - to honor such requests is actually not available in HSBC's vault to be delivered and the trustee will attempt to settle in cash.  Gold goes bid without.

At this point there's really no telling just how much longer GLD can be drained of gold before the western Central Bank/BIS fiat paper gold system inevitably collapses, but with each passing day of increasing awareness and understanding of what is happening with the world's physical gold vs.the derivative paper claims on that gold, and with each additional day the LMBA GOFO rate is negative, the time to collapse is quickly shrinking.  I do believe that, in what ironically was devised as a "fool-proof" tool manufactured to allow the west to "manage" the physical gold vs. paper problem for a long time, will likely be the Icarus wings of the U.S. Government's fiat money scheme.

Note:  I am in the processing of revising and updating my original analysis of the GLD trust and why the shares in ETF are fraudulent - stay tuned...

Senator Diane Feinstein Wants To Make NSA Spying On YOU A Law

As an update to my saga challenging Pulte Home executive, Jim Zeumer, to having himself and his management taking their own after-tax money in the bank and buying shares of PHM, so far there's been no response.  He was quick to jump all over me with his disagreement of my analysis of PHM's use of GAAP accounting to exaggerate the company's earnings.  But when I asked him how come he's happy to use $83 million of shareholder money to buy back stock while insiders dump their shares, I get no response.  Nothing.  Crickets.  Still waiting, Jim...

I think next to Harry Reid, Diane Feinstein has to be one of the most vile, hypocritical and power-mongering politicians not named Barack Obama.  I hate to say it, but for as much as I despised Bush and his gang of Republican criminals, the Democrats in power make the previous regime look like choir boys.

I vividly remember in the early 1990's being forced to contribute to Feinstein's Congressional campaign by the guy who ran leveraged finance at Bankers Trust because Ron Burkle (who made a fortune doing grocery store leveraged buyouts) was one of BT's biggest fee-paying clients and Burkle was in the process of buying out Feinstein.  I'm still bitter about that to this day.

Feinstein is leading an effort in the Senate to make it a law of the land for the NSA to listen in to every single phone call - landline or cell - that is made in this country.  In her words, " People believe it's surveillance, but it's not."   Then what is it, Diane?  George Orwell Was Right

I shudder to think that this might actually pass both houses of congress because Obama will gleefully sign the bill.  Does everyone remember that Obama, as one of the planks in his campaign platform, promised to make an effort to repeal the Executive Orders signed by Bush which enabled comprehensive cell phone surveillance of every American?

I'll bet that nearly everyone who voted for Obama does not remember.  Like blind sheep following the  guileful Shepherd to the slaughterhouse, Obama supporters seem to have selective memory of Obama's promises.  I vividly remember because I was at one of his rallies in Denver in October 2008 and I can recall all the promises he made, none of which he has followed through on.

Although I don't think anyone really believes Obama when he expresses denial of knowing the extent of the NSA's spying on the whole world - it's truly amazing how closely the unfolding events of today reflect the vision of George Orwell's "1984," which was published back in 1949: