Current Indicators

As we pursue the possibilities for false reforms of consolidated industries and markets with more consolidation of industries and markets and calling it a bail out, a few indicators currently confirm the problem, and the solution.

A 30% rise in the price of oil today indicates the consolidation of capital that is the liquidity crisis. This capital, consolidated, is not being used to liquidate the debt--grow the economy--in crisis, it is being used to bid up the price of a basic input which is both inflationary and deflationary at the same time.

The result is profit without growth which is given a favorable tax rate. It is the problem not, as McCain suggests, the solution.

Since the consolidated capital is not being used to buy the bad debt, it will be monetized through the treasury and the federal reserve system. This is being explained as the cause for the sudden rise in the price of a barrel of oil (a falling dollar valuation due to no real-economy growth from the investment of the capital) when it is the effect. It is a deliberate fraud and, again, what is wrong with it.

In terms of fundamentals, no-growth investments and profits (returns) should lower the price of oil because there is no demand being added, which fundamentally describes the crisis we are in financially. The effect of the investment is inflationary nevertheless which is fraudulently claimed to be due to demand exceeding supply. The result is also to give false support to the price per barrel and an uncertain value to alternatives which discourages investment.

The cause of the sudden price spike in oil is the sudden movement of consolidated wealth (private equity and hedge funds) out of equities and into oil futures contracts that were magnified on a short squeeze. Properly timed by the hedge fund managers this produced a big profit with no growth from the investment at a favorable tax rate. If this kind of capital management is allowed to continue with the favorable tax rate, the trillion dollar bail out of the credit markets will be paid by the least able to pay already beset with high inflation and low growth. The result is a fully intended disaster that demands command and comtrol of elite authority.

Another significant indicator of the operation of an overconsolidated capital being the source of our problems is hedge fund managers complaining about having to make an accounting of short sales as per the SEC. That eliminates the all-important black box necessary to manipulate market prices. If the fund managers do not behave legally, there will be a criminal liability if the data is not falsified.

Short sales are an effective way to manipulate market prices because selling large blocks of borrowed shares "causes" fear and a downtrend independent of real market values. In other words, it is an easy way to perpetrate a fraud and dictate prices, especially if capital is consolidated.