Gas Prices Set Record, Media Remain Silent

ZeroHedge is reporting that average gas prices have quietly set a record high for the 3rd week of August. With just 2 1/2 months before the presidential election, the MSM is remaining mum on the subject. Because the MSM hasn't mentioned the record, the Drudge Report hasn't said anything about it, so conservatives don't realize that they have a new fact with which to use against Obama. Leave it to "kooky" libertarians to enlighten everyone.

Today's ECOMINOES Radio Guest: Executive Director Of The Bastiat Society

Today Eric and I will be chatting with Brad DeVos, Executive Director of the Bastiat Society, an international pro-free market organization headquartered in Charleston, SC. We'll also be discussing the revised dire CBO projections for "Taxmageddon", the Brandon Raub story, the timetable of Obamacare’s 18 economy-suffocating tax hikes, and more. Don't miss it: 4-6 PM EST on Kinetic HiFi.

UPDATE: Drudge Report Picks Up Committed Marine Story, Soldier Released

Conservative media behemoth Drudge Report picked up the Brandon Raub story a couple of days ago (full disclosure: I plugged my blog by sending them a tip), and, under intense public pressure, a federal drudge has ordered the immediate release of the Marine from a VA psychiatric ward. A win for civil libertarians! This is precisely why the Feds want to stifle free speech on the web via the NDAA, CISPA, etc.

Romney Would Definitely Boot Bernanke AND GOP Backs Gold Standard?

After outrage over Romney's top economic adviser Glenn Hubbard's statement that he would likely advise a President Romney to keep Ben Bernanke as Fed chairman, the presumed GOP candidate told Fox Business that he would select a "new person to that chairman position". Romney doesn't exactly have the best track record of standing firm on an issue, but It would be very difficult for him to backtrack after such a statement.

And there's more encouraging news: Drafts of the party platform to be adopted at the Republican National Convention call for an audit of the Fed and a study of a possible return to the gold standard. Is this too good to be true? A return to the gold standard would 1) make it impossible for the Fed to blow bubbles, which would greatly reduce the possibility of future economic depressions, and 2) limit future inflation. The only caveat: it would also severely limit the amount politicians can deficit spend. Is the GOP willing to abandon deficit spending? 

Stay tuned to see if these two extremely important positions make it to the final draft.

DOW/Gold Ratio Chart Portends Continuation Of Economic Depression

If endless bad jobs reports and negative news from Europe, a prominent investor predicting a 100% chance of recession in 2013, and the CBO predicting doom if Congress doesn't extend the Bush tax cuts and agree on spending cuts wasn't enough to convince you that this economic depression will continue for the foreseen future, perhaps the addition of this chart will do the trick. Charting the DOW/Gold ratio from 1920 to present, we see a nice correlation with economic performance, with peaks correlating with boom times and troughs correlating with times of stagnation, recession, and depression. According to the chart, the DOW/Gold ratio is headed to 1:1, meaning we should expect economic malaise for some time. Indeed, the student loan bubble will eventually burst, and some economists are expecting that crisis to be worse than the mortgage crisis. Happy times are here to stay. Oh, and one more thing: The chart also suggests the stock market will lose nearly 75% of its value.

CBO Gives Most Dire Warning Yet About Taxmageddon

The CBO expanded its forecast for "Taxmageddon", a doomsday scenario that could take place during Q1 2013 if the Bush tax cuts are allowed to expire AND automatic spending cuts are triggered if Congress can't agree on ways to cut the deficit. The office now sees the economy contracting by nearly 3% in the first half of 2013 and the U-3 unemployment rate rising to 9.1%, which would likely mean the official U-6 rate rising to 18% and the true U-6 rate rising to 20%. Job losses would total more than 2 million. With 4 months left of the clock and the entire House up for election in 3--not to mention a presidential election--, there's no indication of either party making concessions on either the tax cuts or the spending cuts.

Romney's Top Economic Adviser Wants Another Term For His *Friend* Bernanke

Romney may have gone on record saying he would consider replacing Federal Reserve Chairman Ben Bernanke, but it's clear that the person who would actually make economic policy decisions, his top econ adviser, Glenn Hubbard, would keep the chief money printer behind the press. Hubbard told Reuters TV today that Bernanke should "get every consideration" to stay on beyond January 2014, when the chairman's current term expires:

Ben is a model technocrat. He gets paid nothing for getting kicked around all the time. I think they ought to pat him on the back...

Hubbard, see, is a life-long friend of Bernanke, and apparently values his loyalty to the Fed chairman over Bernanke's abhorrent job performance:

I may or may not agree with him, but that's very different from saying I question his motives.

I think we call this cronyism. So, what about that "Restoring America" slogan?

Marine Veteran *Arrested* For Political Rants On Facebook

Constitution? What's that? A Marine veteran and Ron Paul supporter was arrested on Aug. 18 after refusing to be committed to a psychiatric ward for posting a series of political rants on Facebook. Richmond, VA resident Brandon Raub was handcuffed and extracted from his home by local police accompanying DHS and FBI agents, but was later charged with resisting arrest when he refused to comply. (Lawyers are going to have a field day with this one.) Raub had been indefinitely committed at a civilian hospital, but has since been transferred to a VA mental health facility. Robert Wenzel of Economic Policy Journal has been posting developments on this story, and Raub's attorneys, who are representing the young man on behalf of the Rutherford Institute, have issued a statement:

The Rutherford Institute has come to the defense of a former Marine, 26-year-old Brandon Raub, who was arrested, detained indefinitely in a psych ward and forced to undergo psychological evaluations based solely on the controversial nature of lines from song lyrics, political messages and virtual card games which he posted to his private Facebook page. Although the FBI and Chesterfield County police have not charged Brandon Raub, a resident of Chesterfield County, Va., with committing any crime, they arrested Raub on Thursday, August 16, 2012, and transported him to John Randolph Medical Center, where he was held against his will due to alleged concerns that his Facebook (FB) posts were controversial and “terrorist in nature.” In a hearing held at the hospital, government officials disregarded Raub’s explanation that the Facebook posts were being interpreted out of context, sentencing him up to 30 days’ further confinement in a VA psych ward. In coming to Raub’s defense, Rutherford Institute attorneys are challenging Raub’s arrest and forcible detention, as well as the government’s overt Facebook surveillance and violation of Raub’s First Amendment rights.

 “For government officials to not only arrest Brandon Raub for doing nothing more than exercising his First Amendment rights but to actually force him to undergo psychological evaluations and detain him against his will goes against every constitutional principle this country was founded upon. This should be a wake-up call to Americans that the police state is here,” said John W. Whitehead, president of The Rutherford Institute. “Brandon Raub is no different from the majority of Americans who use their private Facebook pages to post a variety of content, ranging from song lyrics and political hyperbole to trash talking their neighbors, friends and government leaders.”

Brandon Raub, a former Marine who has served tours in Iraq and Afghanistan, was detained by FBI agents and police officers at his home in Chesterfield County based upon the nature of content posted to his Facebook page in recent months. Like many Facebook users, Raub uses his FB page to post songs lyrics and air his political opinions, as well as engage in virtual online games with other users. On Thursday, August 16, police and FBI agents arrived at Raub’s home, asking to speak with him about his Facebook posts. They did not provide Raub with a search warrant. Raub was cooperative and agreed to speak with them. Without providing any explanation, levying any charges against Raub or reading him his rights, law enforcement officials then handcuffed Raub and transported him first to the police headquarters, then to John Randolph Medical Center, where he was held against his will. Outraged onlookers filmed the arrest and posted the footage to YouTube. Law enforcement officials have stated in press reports that Raub was not arrested. However, as attorney John Whitehead points out, if the police have put handcuffs on you and you’re being held against your will, that qualifies as an arrest. In a hearing before a judge on August 20, government officials again pointed to Raub’s Facebook posts as the sole reason for their concern and for his continued incarceration. Ignoring Raub’s explanations about the fact that the FB posts were being read out of context and his attorney’s First Amendment defense, the judge agreed that Raub should be incarcerated at a VA hospital for up to 30 more days. Rutherford Institute attorneys are working to challenge Raub’s detention and the highly unconstitutional nature of the government’s actions.

Timetable Of Obamacare’s 18 Economy-Suffocating Tax Hikes

When Obamacare was still a bill, Nancy Pelosi told us the behemoth legislation would "not add one dime to the deficit", and Congress had to "pass the bill to find out what is in it". As it turns out, there were 18 different tax hikes in the the bill to bleed the private sector and reduce federal revenue growth by suffocating economic expansion. The following timetable from the Heritage Foundation's blog shows that the productive economy, which has been languishing since it was beaten down in 2008, will be hit with nearly $700 billion in new taxes over the next 2.5 years. Then, in 2018, it will be hit with another $111 billion. Repeal this legislation, President Romney.

Crazy Mayor Bloomberg: Send Immigrants To Detroit

Okay, all bets are off regarding Michael Bloomberg. I thought he was deliberately becoming a communist, little by little. But now I suspect he's losing his mind. Speaking at a forum sponsored by the New England Council, the trans fat-free mayor of New York said last week that the federal government should assign immigrants to live in dilapidated cities like Detroit, and, "if they survive seven years", they should be made citizens:

All the federal government’s got to do is say, 'We’re gonna welcome here in this country--first come, first served--families, if they’re willing to come here under the following terms. We’re going to assign you a city--let’s say Detroit--you got to agree to not be arrested and not take any federal, state or city money, and you’ve got to live there for seven years, and if you survive seven years, we’ll make you and your family full citizens'.

So Bloomberg is suggesting we employ an immigration policy that emulates "Survivor"? Inherited fortunes clearly can't stave off dementia.

Velocity, A Good Indicator Of Economic Health, Lower Than Great Depression

The velocity of money, the number of times a dollar is exchanged, isn't a perfect indicator of economic health, as it sometimes correlates with inflation. But it is a good one. You see, in a booming economy, a dollar is exchanged frequently. In a economic depression, a dollar is exchanged infrequently. Thus, it would be of great concern if velocity dropped to Great Depression levels. Well, velocity never stopped declining since the beginning of the Great Recession, and it recently dropped lower than its lowest point during the Great Depression.

WW II: 44 Months. Iraq: 130 Months And Counting.

Bottom 3: military victories. Top 3: military quagmires. God bless neoconservatism.

Earth To GOP: THE ECONOMY IS WHAT MATTERS IN 2012

GOP abortion politics have certainly given the Democrats a seat in the Senate, and they've possibly handed Obama the swing state of Missouri. In case you've been living under a rock, Republican Rep. Todd Akin of Missouri claimed that pregnancy from rape was rare, especially in cases of "legitimate rape". Furthermore, he stated that Romney and Ryan wouldn't take steps to block abortions in cases of rape. Akin is clearly nuts, so it wouldn't be fair to say his thoughts on abortion are representative of the party's platform on the issue. However, this, in the context of all of the talk during the primaries about the importance of so-called "evangelicals", makes it clear that the GOP is living in some kind of alternate universe in which there's no economic depression, there aren't 28 million displaced workers, and gay marriage is one of the nation's top concerns.

Let me spell it out for the Republicans: THE ECONOMY IS WHAT MATTERS IN 2012. Someone who has lost his livelihood or his home or both doesn't give a shit about your anachronistic social politics. Neither does AN INDEPENDENT VOTER, who is going to make or break the presidential election. In the worst economy since the Great Depression, how stupid do you have to be to have to be reminded that "it's the economy, stupid"?

Wouldn't it be ironic if the Democrats held the Senate by one seat? It's now a more of a possibility than ever.

My Experience With The Crony-Protecting FDA

People might get the wrong idea that I'm some kind of anti-capitalist super-liberal when I use the term "crony capitalism". But when I use the term, I'm referring to federal officials using the Government's power of the gun to enrich cronies at the expense of everyone else. As I disclosed in a recent post, I've either been unemployed or underemployed since I earned my MBA in 2008. I was offered about a year-and-a-half ago a sales position with an upstart surgical supply business in Tampa, FL, which had created a revolutionary medial instrument sterilization unit. But the FDA, notorious for cronyism, dragged on and on with the licensing process (I suspect at the behest of a certain big company offering medical instrument sterilization products), which had already been going on for more than two years. I stayed rent-free in the office living quarters for a few months and waited for the FDA to approve the sterilization unit, which had passed numerous rounds of rigorous testing by a reputable independent medical device inspection agency. But the FDA never granted the license and, eventually, my financial situation forced me to return to Charleston with my tail between my legs and a bitter taste in my mouth toward the FDA.

Years later, the agency still hasn't approved the unit, and the business is still sitting idle.

Federal Investment House Ruling Favors Obama Crony

The ruling in the case of failed futures brokerage Sentinel Management Group could make it difficult for customers to recoup money lost in the much larger collapse of Obama crony Jon Corzine's MF Global. According to Reuters:

A federal appeals court on Thursday upheld a ruling that puts Bank of New York Mellon ahead of former customers of Sentinel in the line of those seeking the return of money lost in the 2007 failure of the suburban Chicago-based futures broker.

The appeals court affirmed an earlier district court ruling that the bank had a "secured position" on a $312 million loan it gave to Sentinel, which turned out to have been secured by customer money.

Futures brokers are required to keep customers' funds in dedicated accounts to protect them from being used for anything other than client business.However, Thursday's ruling suggests that brokerages can use customer funds to pay off other creditors, Sentinel trustee Fred Grede told Reuters.

"I don't think that's what the Commodity Futures Trading Commission had in mind" with its requirement that brokers keep customer money separate from their own, he said.

"It does not bode well for the protection of customer funds."

 Worse, Grede said, is that the ruling suggests that a brokerage that allows customer money to be mixed with its own is not necessarily committing fraud.

That may raise the bar for proving that MF Global Holdings Ltd, under then-CEO Jon Corzine, misused customer funds as it scrambled to meet margin calls to back bets on European debt in the brokerage's final days. A $1.6 billion customer shortfall remains.

"I'm sure Mr. Corzine's attorneys will get ahold of this ruling and use it for all it's worth," Grede said.

The Sentinel ruling is a clear example of crony capitalism at work.