I’ve been thinking about payments By Fred Cederholm

Column for on/after August 26^th, 2007

I’ve been thinking about payments. Actually I’ve been thinking about bill processing, systems/ programming, effective dates, service charges, restructurings, a horror story, and services reps. Believe it or not, most people pay their bills on time, or they at least try to. We presume that all will taken care of when we make that payment, our outstanding obligations will be cleared (or at least mitigated), and we won’t encounter any problems, fines or penalties. As you continue, you’ll see that’s not always so.

You see bill processing systems run the full gamut. They can be manual, automated, integrated, segmented, one-step, multi-step - you-name-it. Most of the time we could care less – that is, unless we encounter problems, fees, and/ or penalties. These can snowball to complicate our lives in more ways than we ever imagined! Most billing systems are now automated - using computers or some other forms of integrated data processing equipment. Now… these technological wonders can process hundreds – even thousands - of transactions in a fraction of a second; but they don’t TH*NK on their own, they pretty much do what they are told to do by their programming software, or by the manual overrides of their Information Technology (IT) supervisors. Like in the military circles, “I was only following my orders” may be an explanation, but it’s no defense when wrongs occur and adversely impact the public.

The legal fiction of the “effective date” is central here. Is the payment consummated (or made effective) when sent? When received? When processed? Or… when posted? You can just bet that “the recipient” is going to use whatever works to its advantage in regards to that other significant legal fiction – the SERVICE CHARGE. You would be amazed how much the so-called service charges, late fees, and penalties contribute to a bottom line. Then again… you may be intimately familiar with the charges, you just question where (or what) exactly is the service? Who is really being “serviced” by the charge?

This unwinding debacle of the housing bubble passing its gas, and the collapsing sub-prime, Alternate-A, and jumbo loan defaults morphing into escalating foreclosures have triggered a whole lot of terminations and lay offs. I’ve noted at least 15,000 cuts nationwide in the past week alone. The question is how many of these are the folks who process the payments from those still making them? Such terminations can create lags in payment processing as will each time a mortgage is packaged and re-sold, or the servicer changes. It’s ten PM, do you know where YOUR mortgage is tonight?

Last week I heard from a friend who had learned they've been "late" on their mortgage for the past five months; they've also been in "growing arrears" all that time! What happened started six months ago when their payment was PROCESSED after the due date. A late penalty kicked in. The following month, the payment was processed on time, but the prior month's late fee was deducted first. Month number two's payment was short by the penalty amount deducted first -making them in arrears on the payment-in-full. You got it, a second penalty was assessed. Next month, ditto and so on and so on. It took five months to bring this "arrears" to the attention of my friend. He was livid because the arrears had popped up on a credit report and not because he was ever contacted by his loan's servicer du jour.

I had him check his bank statement to see when the payment of six month's ago was deducted (or dinged) from his bank account. Well guess what??? The payment was deducted from the account TWO days BEFORE the due date, but the payment was not credited to the mortgage loan until TWO days AFTER the due date. I'm sure this was all because the servicer utilized a "multi-stage" system. That is, cash the check (or process the electronic transfer) immediately, escrow the funds, and then post to the individual loan ledger later - when they get around to it. There are float considerations at work here, too.

This nightmare scenario could occur with credit card payments, or even with monthly utility bills. I’ve personally dealt with both. Now… a $5, 15, or $25 fee applied to a 100,000 plus “isolated incidents” a month soon become a BIG windfall for the companies in question. I have always called and complained to get credit for the charges – even if I have to deal with their service reps in Bangladesh, Singapore, or Calcutta! I’m Fred Cederholm and I’ve been thinking. You should be thinking, too.

Copyright 2007 Questions, Inc. All rights reserved.

800 people watching it every day The Fiat Empire By J. Jaeger

Dear FIAT EMPIRE Associates:

I am pleased to say that FIAT EMPIRE has now been screened by 122,000 people on Google Video with an average of 800 people watching it every day.(1) Portions of FIAT EMPIRE have also been screened over YouTube about 100,000 times. Someone out there is interested in this subject.

Also, as you may know, FIAT EMPIRE won a Telly Award but it seems that Main Line Life is the only newspaper that has so far been willing to mention this film. (See attached article of 15 August 2007) As we discuss in FIAT EMPIRE, the mainstream media seems to be hesitant about bringing up the subject of the Federal Reserve because maybe they feel it could place too much attention on the relationship between Congress, the Fed and them. Most Americans have no idea that Congress depends on monetizing debt through the Fed as much as they do. Many don't even realize our money is no longer redeemable in silver or gold. When Congress can't sell any more T-Bills, T-Notes or T-Bonds to Americans or foreigners (such as the Chinese), who buys them? The Federal Reserve buys them. Where does the Fed get the money? They effectively print it up. This process, under the watch of both the Democrats and the Republicans, has now driven us into debt almost $9 trillion. Wouldn't you think someone in the mainstream media would be talking about this?

We hope to bring some of these issues to light, but unfortunately, this seems to be only possible as a grass roots movement. Middle Class America KNOWS all is not right and the only presidential candidate that seems to be confronting the Fed issues is Ron Paul and surprise, he interviewed for FIAT EMPIRE.

We are still actively seeking professional distribution for this public service documentary as well as a modest budget for our next documentary, ORIGINAL INTENT - What Americans May Have Forgotten About Their Constitution.

James Jaeger

------------------------

(1) See http://video.google.com/videoplay?docid=5232639329002339531&q=FIAT+EMPIRE&hl=en

Out of $2,407,000,000,000 you only get some $20 billion for energy!

Where do you provide for PLASMA FUSION research?

You are only allocating $82 million to direct SOLAR research?

Out of total federal receipts of some $2,407,000,000,000 you only get some $20 billion for energy! That's despicable. You need to demand more money from the $2.4 trillion the government gets every year.(1) With the amounts of money the DOE gets to work with and the amounts it spends towards the two most important sources, PLASMA FUSION and SOLAR, it's no wonder we have pulled in a war on terror and global warning. The DOE needs to cut out at least $100 billion a year from the DOD budget and use that money for energy research into PLASMA FUSION and SOLAR otherwise there is little chance you will obtain your stated goals.(2) Fusion is 100% clean and the most powerful source of energy in the universe. See my article below.

James Jaeger

http://www.cfo.doe.gov/budget/08budget/Content/Highlights/Highlights.pdf

http://www.whitehouse.gov/omb/budget/fy2008/pdf/08msr.pdf

Check this out. More Death and Destruction Funding

We canceled $3.1 billion going to places like energy, food, education, housing and bridge building so that the money could be "better spent" by the Department of Defense on the "Global War on Terror" and the mission of blowing things and people up all over the planet.

http://www.whitehouse.gov/omb/budget/amendments/cancellation_3_9_07.pdf

I’ve been thinking about liquidity By Fred Cederholm

Column for on/after August 19^th, 2007

I’ve been thinking about liquidity. Actually I’ve been thinking about the weather, equity markets, the housing bubble, the Fed’s interest rates, Creston, and valuations. As I begin to write this week’s column and look out the window, it’s raining. It has rained here off and on for six of the past seven days – the forecast for the coming week is the same. When the ground is already saturated, it doesn’t take much more to make a bad situation a whole lot worse. The same can be said as true for the problems unwinding in the world’s financial markets because of this whole sub-prime credit housing mess.

You see the term liquidity refers to more than water. In financial/ economic terms it refers to the ebb and flow in the ability to redeem or convert one form of asset/ liability into another. Money (that is cash) is regarded as the most fluid medium of exchange. When you wish to purchase something - be it food, clothing, energy… (whatever); it is much easier to consummate the deal by using cash than it is to get what you desire by swapping stocks, bonds, real property, or bartering commodities for it. A major part of any exchange transaction is valuation. How much of “X” will I give up to get so much of “Y”?

Despite all the claims of some new world order, a new economic “reality,” a new global economy, or this new paradigm/ basis for valuing/marketing investments vehicles; recent events are showing that all the hype and spin is a bunch of hooey. The traditional economic rules of supply and demand setting prices, real wealth or value coming from assets and not liabilities, cash/ money being central to transactional exchanges, and something only being worth what someone else will pay for it are still with us. This is not going to change regardless of what the poobahs of Washington, DC, the moguls of Wall Street, or the central bankers of the world tell us. I mean… it is their “scripting” that got us here.

This housing bubble was no accident. It was the deliberate creation of cheap money, excess cash, and a decision to create “a soft landing” from the “irrational exuberance” of a dot com mania, a stock market run amok, and an ill conceived conspiracy to fluff the US economy by promoting spending and consumption. The spending was facilitated by an increase of debt, fiat money, and inflation, not by any increase in production, growth of real wealth, or rise in productivity. The money came via the printing presses and the recycling of foreign holdings of our existing debts and deficits. We were all too willing. Because more money (albeit borrowed money) flowed thru our fingers, we thought we were better off.

There is now tremendous pressure on Chairman Bernanke and the FED to “create” more money and cut interest rates to fix liquidity problems, bail out the debt laden public, and fluff the equity market averages. Has everyone forgotten that it was such policies that got US/us where we find ourselves now?

The FED did infuse (print) an additional $59 BILLION over a mere 48 hours and they cut the discount rate (special money created by the FED and lent to banks) by a half a per cent. The FED Funds Target Rate remained the same at 5.25% - for now. Any change there would be admitting a lie - any increase would signal how inflation is far worse than acknowledged; any cut would signal why our booming economy is in trouble. Either way… the FED’s credibility is shot as any honest broker of information.

My little home town of Creston was pretty much isolated in the cornfields of northern Illinois from the travails of the world over the years – not any more. Out of a real property stock of some 200 properties, there are currently 15 houses, 9 lots, and 10 rental units on the market. The same seems to be true everywhere across this land. People need to (or at least want to) cash out and thus improve their liquidity. The same now seems true for all investments. But… what will you get? What’s the value?

These loans pooled, packaged, and sold as investments are dragging down everything. With so many properties in arrears, default, foreclosure, and going on the market; is it any wonder why so many “investments” are at best - worth less; or at worst - worthless? What will be all affiliated costs to global investors, insurance companies, money market funds, mutual funds, or pension funds when all this “construction dust” settles? I’m Fred Cederholm and I’ve been thinking. You should be thinking, too.

Copyright 2007 Questions, Inc. All rights reserved.

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Wrong kind of action By Joost van Steenis

Dear reader, this is the 90^th letter of an Autonomous Thinker

In actions you have to abide by a few simple common sense rules, I give only six.

1. Stay out of prison.

2. Do not overestimate yourself

3. Behave like a fish in the water (Mao)

4. Aim to change the mind of leading people.

5. Do not destroy insured things.

6. Do hardly send messages to the media

These simple rules were violated by the German Militante Gruppe (Militant Group), a leftist organisations that (according to the police) carried out 16 violent attacks since 2001. In July 2007 four members of the Group were arrested, they violated rule one and they cannot be active anymore.

They are accused to have put fire to a court house, a police office, a living quarter of the German police and offices of employers organisations. They were apprehended when they put fire to some trucks of the German Army. They violated rule five, do not destroy targets that are insured and can be replaced. It is a small nuisance but this kind of actions does not change the minds of leaders. They accept it as part of their job. And remember, THE LEADING ELITE HAS ONLY ONE JOB: TO SAFEGUARD AND EXTENT ITS PRIVILEGED, PROSPEROUS AND SAFE ELITEWORLD.

The list of targets makes clear that the group violated rule two, do not overestimate yourself. One small group cannot change the world. You are a tiny flea in the sea of six billion fleas and when you sting once an opponent and than sting another opponent, these people will shrug off the attacks and continue their activities. Concentrate your attacks, thousands of fleabites are worse than one bite from a tiger. See my 32^nd Letter about The War of the Flea ( http://members.chello.nl/jsteenis/letter32.htm)

In its first action the Group sent letters containing small bullets to several members of the German elite. But they violated rule six by informing the media of their deed. They overestimated themselves ( rule two) because they thought that one action could rock the world. Later actions targeted insured possessions and workplaces of the elite ( rule five).

I do agree with the idea of the members of the Group that something has to be done to change our society. The disproportionate differences between elite and masses is not human. But action must know a certain success by forcing some members of the elite to take different decisions. That actions are recorded in the press has nothing to do with success ( rule six).

The Group tried to comply with rule one and rule three by living a normal live with normal jobs. They did not vanish in the underground world as the RAF, the Rote Armee Fraktion, the German Red Army of the seventies. But they should have learned something of those anonymous activists who in Berlin are putting fire to expensive cars. These activists do not inform the media but their actions are nevertheless recorded on the site http://www.brennende-autos.de . This year 82 cars have been destroyed. (Brennende Autos means Burning Cars).

The Group neglected also rule four. This rule is of the utmost importance. It should be imperative to penetrate into the mind of elitepersons so these people will realise that is not anymore possible to live the privileged life they have lived for eons. And when a small group of activists force only one member of the elite to change her or his life then the influence will be much greater than a few destroyed cars, buildings or even houses. When many small groups come into existence (many fleas that bite elitepeople) than the possibility will arise that a New World will come into being.

But without a clear goal (disturbing the privileged life of the elite) and without actions that minimise the chance that rule one will be broken, a New World will remain remote. Within the boundaries of the elitist democratic laws (or just outside these boundaries) there are many possibilities to be successfully active for the purpose I described above.

Yours truly, Joost van Steenis

http://members.chello.nl/jsteenis

Ways to increase masspower

Our enemies approach nearer to truth in their judgments, By Teri

You always admire what you really don't understand.


The covers of this book are too far apart.


They that have lived a single day have lived an age.


What life half gives a man, posterity gives entirely.


Democracy encourages the majority to decide things about which the majority is
blissfully ignorant.


The effort of art is to keep what is interesting in existence, to recreate it in the
eternal.


Our enemies approach nearer to truth in their judgments of us than we do ourselves.


The cross is the invincible sanctuary of the humble.


There seems to be some perverse human characteristic that likes to make easy things
difficult.


It's funny, isn't it? How your best friend can just blow up like that?


Old age comes on suddenly, and not gradually as is thought.


Wickedness is its own punishment.


Anger is never without an argument, but seldom with a good one.

I’ve been thinking about shoes By Fred Cederholm

Column for on/after August 12^th, 2007

I’ve been thinking about shoes. Actually I’ve been thinking about global anxiety, the US housing bubble, a giant octopus, liquidity, debt remarketing, volatility, and tap dancing. We had another week of financial anxiety worldwide. Investment funds were frozen. BILLIONS of paper assets evaporated. Global stock markets spiked and valley-ed… only to spike and valley again. More of same will follow.

You see the interrelated and systemic dilemmas which came about because of the worldwide reach from a “pending” implosion of the US housing bubble continued to be the story on page one. For more than a decade the overbuilding of America’s housing sector ran amok. When the dot com bubble burst (only to be followed by the precipitous equity market declines after 9-11), interest rates were pushed to almost zero as a quick fix (or solution) to the problems. To keep our economy growing, real estate became the next big thing – surpassing even the building boom fueled by pent up demand of the baby boom generation following World War II. Some fix!?! One greed-driven “irrational exuberance” was replaced by an even bigger one. THUD! Did the other shoe finally just drop? If not, then when?

Up thru the 1950’s, the valuation of properties had pretty much held its own since the Great Depression and people were happy if their homes were worth about what they paid for them – after all they had been living there and raising their families there all those years, right? Things were stable. The money supply didn’t fluctuate much. Interest rates were steady and not manipulated. The stock markets traded within a finite range (always below the magic 1000). There was some small appreciation in share price over time - justified because the companies behind the stocks (and their sales) were actually growing in real terms. Inflation wasn’t even a consideration. There were periodic recessions, but that was the invisible hand of the markets re-adjusting themselves. The world was at peace; if for no other reason than had the world’s super powers gone to an all-out war, EVERYBODY was toast - literally!

In the 60’s and beyond, “something’s happening here, and it just ain’t exactly clear. Stop, hey what’s that sound everybody look what’s going ‘round…” Hollow suburban conformity gave rise to a counter culture which evolved into some “hybrid establishment.” The pattern of materialism to idealism morphing into a newer consumerism continued. The role, “responsibilities,” and meddlings by our governments grew. Changing was accelerating. One segment/ sector/ nation saw what another had and wanted it, too – NOW! This was not greed; if so “greed is good.” “Plastic” WAS the one word of the future; not as a petrol-based material for products, but as a means to consumptive ends. “Charge it” was now the mantra to get all you ever wanted (and more). This was true for individuals, for families, for corporations, and for government as well. Community, investment, and central bankers were more than willing to accommodate by lending/ supplying the fiat money or the plastic money to boot. “Go for it!”

Wall Street saw the market possibilities and hopped on the bandwagon - creating a whole new class of pseudo investments – the financial derivatives. These “opportunities” were not a chance to buy into actual commodities, assets, or companies. They “entitled” the investors to a piece of somebody’s or something’s debt – really the flow of future payments on that debt. This system provided a bottomless supply of credit/ liquidity and promoted seemingly endless growth, consumption, and “prosperity.” The housing pyramid bubble is but the latest (and biggest) incarnation of this scam. US addiction to debt far surpassed our own domestic ability to print money. Tentacles of this giant octopus extend globally as we now count on the entire planet to recycle the dollars they already hold into financing more of our debt.

All is well… IF and ONLY IF payments are being made. Well, guess what…? Defaults have already triggered freezes and mega- BILLIONS of write-offs on these investments in the US, Germany, and France. When will similar moratoriums on redemptions of such “investments” spread to Australia, the UK, Japan, China, Korea… THUD! Did another shoe just drop? Or, is this “housing bubble octopus” only still tap dancing? I’m Fred Cederholm and I’ve been thinking. You should be thinking, too.

Copyright 2007 Questions, Inc. All rights reserved.

I’ve been thinking about containment By Fred Cederholm

Column for on/after July 29^th, 2007,

I’ve been thinking about containment. Actually I’ve been thinking about damage control, the housing bubble, Wall Street, food stuffs, sports/ entertainment, the Military, Justice, and the White House. What a week that was! Fred, the news junkie was actually experiencing shock and awe overload.

You see no matter where you looked (or… no matter what the subject) everything seemed to need “a fixer” or at least a major public relations makeover big time. This week “der spinmeisters” will need to get out in force – not to actually “fix” the problems mind you, but at least to fabricate a happy explanation of sorts, making all the front page messes of last week - well… less messy more palatable.

Months back when FED Chairman Bernanke attempted to sooth concerns over the impending housing bubble finally “passing its gas” by stating that the US financial institutions (TH*NK banks) were not going to take the hits the Savings and Loans did almost two decades ago. This was echoed by Maestro Greenspan whose policies of cheap money had actually created it. The Banks wouldn’t take the hit, the investors in the MBSs, CMO’s, and CDO’s (those who bought rights to any future liquidations from the liabilities they purchased as derived investments) would. This is pretty much a sum zero game. Meaning…for every dollar of write-down, write-off, or marking-to-market, somebody will have a loss. Two weeks ago investment banker/underwriter Bear Stearns absorbed a hit of a few BILLION on two of their housing hedge funds, last week investors were told not to count on getting anything back – nothing.

The Wall Street euphoria of the Dow cracking 14,000 (for whatever reasons THAT happened) deflated or “passed gas” as the markets suffered their worst one-week declines in five years. This was spun /contained as a “correction” reflecting uneasiness of the housing situation, crude oil within pennies of all-time highs, and the unraveling of placing more debt-based investment grade paper (junk bonds) to finance the numerous merger and acquisition buyouts which had been fluffing the equity markets. Some correction? Last Thursday and Friday alone upwards to a TRILLION dollars of “paper” gains and assets simply evaporated! How will “der spinmeisters” contain these declines as a “correction” and not a …?

Meanwhile in the marketplaces for our food and stuff, reported figures suggest a bump in the US consumer confidence and Gross Domestic Product. More means better to Uncle $ugar. I have no doubt that America spent more in the second quarter, but was this because (maybe) families had to eat, fill their vehicles, replace routine worn-out stuff at higher prices? Remember “core inflation” doesn’t reflect either jumps in food, or energy. Outstanding plastic money (credit card) balances were up during the period. As far as what happened with the money supply, it’s really hard to say. When concerns over how much money was being printed, Uncle stopped reporting the broadest measurement (the M3) a year ago in March. Adding insult to injury, there were more recalls/ alerts for food contamination. China wasn’t to blame here: they’ve “contained” their previous bad raps by executing their chief quality control guy.

Sports headlines focused on the Tour de France doping scandals. Football was “dogged” by illegal inhumane fighting. Baseball records are being soured by potential steroids abuse. The objectivity of basketball refereeing is under investigation. All will require containment and major public relations rehabbing to appease the fans - on the entertainment front ditto for BOTH Britney and Lindsay.

The military and our involvement abroad need “containment,” too. The President has put a lot of his eggs in the Patraeus basket – deferring any decision on troop cutbacks until after the General reports in September. Selected Capitol Hill types got an “off the record” pre- briefing at the Pentagon via closed circuit satellite transmission – no content was made public. But… the Iraqi Prime Minister did go public with his desire for Patraeus to leave – now. Our government stopped weekly reporting of how many hours of electricity are now available in Baghdad. The tragic demise of football star turned Iraq War soldier Tillman was further downgraded from death by terrorist attack to casualty by friendly fire to close-range fragging? The White House isn’t saying much about this one –claiming executive privilege.

Congressional antipathy to ignored subpoenas, stonewalling, obstruction of justice in attempted firing of various US Attorneys escalated. Alberto Gonzales’ star is definitely waning. How do you pursue contempt of Congress charges when the Attorney General won’t pursue them and the White House claims executive privilege at every turn? With all these fronts needing containment, is there any wonder why President Bush is looking forward to an extended vacation/ getaway to his Texas ranch? Even in the heat of August? I’m Fred Cederholm and I’ve been thinking. You should be thinking, too.

Copyright 2007 Questions, Inc. All rights reserved.