Obama’s Tyrannical Executive Orders

A September 24 a Wall Street Journal editorial warned that President Obama is moving to control the Internet by executive order. “Any day now, the White House will issue an executive order on cyber security, according to Homeland Security Secretary Janet Napolitano who said last week that the measure ‘is close to completion.’”

It noted that “the White House intends to go ahead with its order in the face of vociferous opposition on Capitol Hill.”

“According to leaked versions of the draft, the executive order would impose security standards for 16 critical industries” and that “private companies have innovated and invested heavily to protect themselves without regulatory prodding. What they need from the government is an information-sharing program and liability protection.”

This is just one more executive order that would, along with others, impose a totalitarian control over every aspect of life in America on the pretext of a national emergency. We had a national emergency on 9/11 and no laws were abrogated, no Constitutional freedoms denied.

A Homeland Security Department study, “Hot Spots of Terrorism and Other Crimes in the United States 1970-2008”, listed Americans who are “fiercely nationalistic”, “suspicious of centralized federal authority” and “reverent of individual liberty” as potential terrorists.

Jeffery T. Kuhmer, writing in The Washington Times in March, noted that “On March 15, the White House released an executive order, ‘National Defense Resources Preparedness.’ The document is stunning in its audacity and a flagrant violation of the Constitution.”

To understand how extensive this is, the Western Center for Journalism published a list of “Obama’s Worst Executive Orders” asserting that some 900 Obama executive orders had been initiated when in fact Obama has signed 139. However, added to active EOs from previous administrations, the Center is correct in its fears that he is “creating a martial law ‘Disney Land’ of control covering everything imaginable.”

• Executive Order 10990 allows the Government to take over all modes of transportation and control of highways and seaports.
• Executive Order 10995 allows the government to seize and control the communication media.
• Executive Order 10997 allows the government to take over all electrical power, gas, petroleum, fuels, and minerals.
• Executive Order 11000 allows the government to mobilize civilians into work brigades under government supervision.
• Executive Order 11001 allows the government to take over all health education and welfare functions.
• Executive Order 11002 designates the Postmaster General to operate a national registration of all persons.
• Executive Order 11003 allows the government to take over all airports and aircraft, including commercial aircraft.
• Executive Order 11004 allows the Housing and Finance Authority to relocate and establish new locations for populations.
• Executive Order 11005 allows the government to take over railroads, inland waterways, and public storage facilities.
• Executive Order 11049 assigns emergency preparedness function to federal departments and agencies, consolidating 21 operative Executive Orders issues over a fifteen-year period.
• Executive Order 11051 specifies the responsibility of the Office of Emergency Planning and gives authorization to put all Executive Orders into effect in times of increased international tensions and economic or financial crisis.
• Executive Order 11310 grants authority to the Department of Justice to enforce the plans set out in Executive Orders, to institute Industrial support, to establish judicial and legislative liaison, to control all aliens, to operate penal and correctional institutions, and to advise and assist the President.
• Executive Order 11921 allows the Federal Emergency Preparedness Agency to develop plans to establish control over the mechanisms of production and distribution of energy sources, wages, salaries, credit, and the flow of money in U.S. financial institutions in any undefined national emergency. It also provides that when the president declares a state of emergency, Congress cannot review the action for six months.

These executive orders are a blueprint for the takeover by the government by White House fiat, by-passing Congress.

By declaring that “international tensions and economic or financial crisis” or a “national emergency” exists, it puts all powers of governance in the hands of one man, Barack Hussein Obama.

Do you want to live in such a nation?

Powerful 7.3 earthquake strikes along the coast of Colombia: the fifth 7.0 magnitude quake to strike in 45 days

September 30, 2012 – COLOMBIA – A strong 7.3 magnitude earthquake struck along the coast of Colombia at a depth of 162.1 km (100.7 miles). The epicenter of the earthquake was 62 km (39 miles) S (176°) from Popayan, Colombia and 345 km (214 miles) from QUITO, Ecuador. According to USGS statistics, about fifteen 7.0 magnitude earthquakes occur each year but there have been five such high intensity earthquakes reported across the planet in the last 45 days, provided the USGS does not downgrade today’s quake further. On August 14, a 7.7 magnitude earthquake was reported in Sea of Okhotsk near NE Russia; on August 27, a 7.3 magnitude earthquake struck off the coast of El Salvador; on August 31, a 7.6 magnitude earthquake struck near the Philippine Islands, and on September 5, a7.6 magnitude earthquake struck off the coast of Costa Rica. Today’s earthquake was originally registered as a 7.4 by the USGS. The director of Colombia’s disaster relief service, Carlos Ivan Marquez, said that there were only reports of minor damage to homes in one village. The temblor shook buildings and rattled windows in 10 central and western provinces, but despite police and firefighters reported no damage. The quake also shook Ecuador’s capital Quito and other parts of the country for about 30 seconds, and was felt particularly in tall buildings in the capital.

HIGHEST DROUGHT IN THE 12 YEAR MONITORING HISTORY OF U.S.-65.45% OF US IN DROUGHT

National Drought Summary -- September 25, 2012

The discussion in the Looking Ahead section is simply a description of what the official national guidance from the National Weather Service (NWS) National Centers for Environmental Prediction is depicting for current areas of dryness and drought. The NWS forecast products utilized include the HPC 5-day QPF and 5-day Mean Temperature progs, the 6-10 Day Outlooks of Temperature and Precipitation Probability, and the 8-14 Day Outlooks of Temperature and Precipitation Probability, valid as of late Wednesday afternoon of the USDM release week. The NWS forecast web page used for this section is: http://www.cpc.ncep.noaa.gov/products/forecasts/. Weekly Summary: A series of upper-air troughs and accompanying strong cold fronts moved across the eastern half of the contiguous United States during the past week. The East Coast states, and both the Great Lakes region and Ohio Valley, received beneficial rainfall with the passage of these cold fronts. The West was mostly warm (generally 3-7 degrees above average) and dry, and the monsoonal showers and thunderstorms that occurred 2-3 weeks ago shut down this past week over the Southwest. Temperatures in the eastern half of the country ranged from 4-12 degrees below normal, with the core of the coolest air centered over the central Corn Belt. The Northeast: Widespread heavy rain (2 inches or more) and improving stream flows this past week have resulted in 1-category improvements across parts of the region. Residual abnormal dryness (D0) has been removed from southern New England and portions of New York and western Pennsylvania. Mid-Atlantic: Heavy rain (2 inches or more) fell across the higher terrain of western Virginia this past week, with mostly moderate (0.5 to 2 inches) rain elsewhere in Virginia, and portions of West Virginia. Accordingly, the abnormally dry (D0) areas in West Virginia and in western Virginia were reduced in size. In southern Virginia, 1-category improvements were made in the I-85 corridor from Mecklenberg County northeastward to Charles City and James City Counties just east of Richmond. In Maryland, short-term improvements have been offsetting long-term rainfall deficits. As a result, the moderate drought (D1) designation from last week has been retained. The Southeast: Based on Percent of Normal Precipitation (PNP) patterns over different time periods, mostly near-normal stream flows, and a pronounced lack of major impacts, a large portion of the D0 area in western North Carolina and a small portion of north-central South Carolina were removed. Rainfall departures over the coastal plain of North Carolina have become more of a concern recently, especially during the past 30-days. In the absence of significant precipitation in the next 7-days, some degradation in the drought depiction may be needed in this area next week.  Continuing dryness in Georgia prompted a degradation from D3 to D4 conditions in the west-central counties of Clayton and Paulding. The Ohio Valley: Recent precipitation allowed for a 1-category improvement in the drought depiction across north-central and northeastern Ohio, and northwestern Pennsylvania.  In southwestern Indiana, a large surplus (5-8 inches in the past 30-days) of precipitation will help to recharge soils. This area will be reassessed next week, with improvements likely. The Midwest/Upper Great Lakes: Significant changes were deemed necessary this week to the regional drought depiction, especially for far southwestern and northwestern portions of Minnesota, where extreme drought (D3) was introduced. In general, a one-category degradation was made to a large portion of the state, including the addition of D1 conditions to the Arrowhead region. In the Upper Peninsula of Michigan, significant improvement is noted as recent synoptic and lake-enhanced precipitation (weekly totals of 1-4 inches for the northern half of Upper Michigan) helped to trim back the area of D0 conditions, now confined mainly to Iron, Dickinson, and Menominee counties. The Menominee River (along the border with northern Wisconsin) is very low, and at some points near record low levels. D0 was also removed from northern Door County (north of Sturgeon Bay) due to recent rainfall. In east-central and south-central Illinois, recent rains prompted a 1-category upgrade from moderate drought (D1) to abnormal dryness (D0), with additional upgrades possible next week pending reassessment of conditions. The Northern Plains: In eastern North Dakota, an area of extreme drought (D3) was introduced to the counties of Nelson, Grand Forks, Griggs, Steele, and Trail. In addition to Year-To-Date precipitation deficits ranging from 6-12 inches, significant reduction in sub-surface water has also been noticed. Central portions of the state have experienced additional drying, prompting a reduction in D0 coverage which now includes only Sheridan, northern Burleigh, eastern McLean, and northwestern Wells counties. In central and eastern South Dakota, 1-category degradations were made in response to a continuing lack of rain. The Central and Southern Plains: Little or no rainfall this week resulted in mostly minor degradations across parts of North-, East-, and South Texas.  The West: Relatively warm and dry conditions prevailed across most of the West during the past 7-days. Temperatures generally ranged from 3-7 degrees above average, and 7-9 degrees above average in western Montana. Very minor adjustments to the drought depiction were made in southern Nevada (very modest improvement in part of Clark County) and south-central California (slight degradation in southern Kern County from D0 to D1).  Minor adjustments were also made in Montana, and two areas of long-term hydrologic impacts were designated on the depiction in the western part of the state. Hawaii, Alaska, and Puerto Rico: No changes were made to the depictions for these regions. Looking Ahead: In the ensuing 5 days, areas of heavy rainfall (2 inches or more) are predicted in a band from Rhode Island southwestward to the Washington, D.C. area, as well as in a horseshoe-shaped pattern from the Texas Coast westward across southern Texas, then heading northward across the Texas Panhandle and then curving east-northeastward across much of Oklahoma and southeastern Kansas to southern Missouri. The southern Plains can certainly use the rain. Unfortunately, little if any rain is expected to fall across the hard-hit drought areas in the eastern Dakotas, eastern Nebraska, and the Upper Mississippi Valley/Upper Great Lakes region. The CPC 6-10 Day Precipitation Outlook is projecting elevated odds of above-median precipitation across the East Coast states and upper Ohio Valley, with the highest probabilities (50-percent) in the Northeast. There are elevated odds of below-median precipitation over most areas west of the Mississippi River, with the exception of near-median precipitation forecast over Montana, North Dakota, and Minnesota.

Jordan on the brink: Muslim Brothers mobilize for King Abdullah’s overthrow

Jordan’s Muslim Brotherhood has given King Abdullah II notice that he has until October to bow to their demand to transform the Hashemite Kingdom into a constitutional monarchy or face Arab Spring street pressure for his abdication.
 DEBKAfile’s Middle East sources report that Israeli and Saudi intelligence watchers are becoming increasingly concerned about the approaching climax of the conflict in Amman between Islamists and the throne .

For Israel, an upheaval in Jordan bodes the tightening of the Islamist noose around its borders – Egypt and Libya to the south and Syria to the north, with unpredictable consequences with regard to Jordan’s Palestinian population.
Saudi Arabia, already threatened by Iranian aggression, fears the oil kingdom may be next in line if its northern neighbor is crushed under the marching feet of the “Arab Spring.”
The oil kingdom’s royal rulers are reported to have belatedly woken up to the peril and are in a panic. They realize that their preoccupation with helping Syrian rebels overthrow Bashar Assad misdirected their attention from the enemies lurking at their own door. Thousands of articles in the Arab press in the past year have predicted that after the Muslim Brotherhood seizes power in Damascus, Amman would be next in its sights followed by Riyadh.
The latest DEBKA-Net-Weekly of Sept. 21 analyzed the plight closing in on the Jordanian monarch and outlined three of his options:

1.  He could bow to the main Muslim Brotherhood’s demand by submitting to the kingdom’s transition to a constitutional monarchy and the transfer of executive power to an MB-led government by means of the electoral reforms for which the Brothers have been pushing for years. In Jordan as in Egypt, the Brothers hope for a two-third majority in a free election.
2.  He could stand up to the Brotherhood’s demands and order his security, intelligence and military forces to crack down on the opposition. This course carries the risk of plunging Jordan into the carnage of civil war among the diverse segments of the population. The biggest dangers come from the Bedouin tribes, whose traditional allegiance to the Hashemite throne has weakened in recent years, and the Palestinians who form 60 percent of the population.

3. He could seek to negotiate a compromise through various brokers. Our sources report that several attempts at mediation have been ventured of late, but got nowhere because the Muslim Brotherhood sent its most radical leaders to the table and they left very little margin for compromise.
According to sources at the royal court, Abdullah will very soon meet with MB leaders for a personal appeal for calm after years of heated debate. Most observers believe that he has left it too late and by now the Muslim Brotherhood has got the bit between its teeth.
Indeed, according to an internal memorandum leaked to the Al-Hayat newspaper, the MB has already set a date for mass demonstrations against the King to start on Oct. 10 and ordered its members to go to work at once to mobilize at least 50,000 demonstrators for daily protests against the king and the royal family until he bows to their will.

The memorandum states: “Every member must be dedicated to communicate with his relatives, close friends, acquaintances, fellow employees and various Islamic groups and patriots…” It calls for the formation of “hotbeds to… focus on the participation of groups affiliated with universities, schools and women’s organizations.” Protesters are also advised on tactics for overcoming a security crackdown.
Jordan’s Muslim Brotherhood has therefore moved forward from opposition propaganda, debating and political pressure to activism against the throne.
Both Jordanian camps are anxiously watching to see which way the wind blows in the White House.

President Barack Obama has a balancing act to resolve:  On the one hand, the Jordanian king has long been a staunch American ally and friend, its mainstay in many regional crises. On the other, Obama regards the Muslim Brotherhood as the linchpin of his external policy of outreach to the Muslim world.

10's of Thousands march in Paris against austerity in show of support for beleaguered EU partners

PARIS (AP) — Thousands of demonstrators marched peacefully Sunday in Paris to denounce austerity measures in Europe that have sparked violent protests in other EU countries struggling to avert fiscal crises.

The march, organized largely by the Left Front party and the Communists, comes before the French parliament's debate this week on a European fiscal treaty. Organizers put turnout at more than 80,000; Paris police declined to provide an estimate.

The protest exposed political pressures faced by President Francois Hollande — whose popularity has been sinking in recent polls — and notably from some ostensible allies of the left. It was the biggest demonstration of its kind since Hollande was elected in the spring, just weeks before his Socialists won control of the National Assembly.

The treaty would set up the European Stability Mechanism bailout fund that European leaders hope will help calm a debt crisis that threatens the eurozone and the global economy.

The main conservative opposition party and most Socialist lawmakers back the treaty. But it has splintered the French left: Far-left parties, the Greens and some dissident Socialists oppose it. The measure is nonetheless likely to pass in parliament because the two biggest parties generally favor it.

On Friday, the French government presented a budget that included high taxes on the wealthiest, but which critics say lacks fundamental reforms that could jumpstart economic growth.

Austerity has fanned recent violence in places like Spain and Greece.

UK Families Face Sharp Rise In Food Costs - USA NEXT TO FEEL INCREASES

British families are being warned to brace themselves for a 15% hike in food costs.

The wet summer has ruined many crops while farmers struggle to cope with the soaring costs of animal feed and are slaughtering or selling off their stock.

Food prices in the UK have risen by 32% since 2007, double the EU average, according to figures compiled by the Department for Environment, Food and Rural Affairs.

Economists now expect the cost of a weekly shop to continue to rise by around 4% a year until 2022 at least.

Sky correspondent James Matthews said: "World food prices are expected to rise above last year's all time high - and some economists predict that in the UK we will be paying up to 15% more at the check-out by June next year."

Earlier this week, the Potato Council said a "perfect storm" of misery was hitting the industry.

Its chairman, Allan Stevenson, said: "The combination of low yielding potato crops, increased crop spraying costs and increased wastage from problems such as greening, soft rots and growth cracks has massively increased the average cost of producing a tonne of potatoes in 2012 to over £200 per ton.

"There is now a perfect storm of misery in the industry as most fresh and processing potatoes are sold by farmers to packers and processors at fixed prices far lower than the cost of production and they in turn are not able to cover their costs from retail and food service customers.

"There is a market price for things like potatoes and at the moment the market price is not reflected in retailers and that needs to change over time."

The worst drought in the US for almost a century, combined with droughts in South America and Russia, have hit the production of crops used in animal feed especially hard.

As a result farmers have begun slaughtering more pigs and cattle, temporarily increasing the meat supply - but causing a steep rise in the price of meat in the long-term as production slows.

Julia Glotz, fresh food editor at industry magazine The Grocer, said: "A lot of foods rely on grains either directly or indirectly so when grains prices move as dramatically as they have, immediately you start worrying about the impact it's going to have on prices in supermarkets in the UK."

9/29/2012 — New Mexico 3.5 magnitude earthquake happens at Dormant Volcanoes and Decalogue Hebrew 10 commandment Stones?!

http://earthquake.usgs.gov/earthquakes/recenteqsww/Quakes/usc000cy0c.php

2012 September 29 00:59:48 UTC

• Details
• Summary
• Maps
• Scientific & Technical

The Los Lunas Decalogue Stone

The Los Lunas Inscription is an abridged version of the Decalogue or Ten Commandments, carved into the flat face of a large boulder resting on the side of Hidden Mountain, near Los Lunas, New Mexico, about 35 miles south of Albuquerque. The language is Hebrew, and the script is the Old Hebrew alphabet, with a few Greek letters mixed in. See Cline (1982), Deal (1984), Stonebreaker (1982), Underwood (1982), and/or Neuhoff (1999) for transcriptions and translation, and Deal (1984) for discussion and photographs of the setting.

George Moorehouse (1985), a professional geologist, indicates that the boulder is of the same basalt as the cap of the mesa. He estimates its weight at 80 to 100 tons, and says it has moved about 2/3 of the distance from the mesa top to the valley floor since it broke off. The inscription is tilted about 40 degrees clockwise from horizontal, indicating that the stone has settled or even moved from its position at the time it was inscribed. (The above photograph was taken with a tilted camera.)

In 1996, Prof. James D. Tabor of the Dept. of Religious Studies, University of North Carolina - Charlotte, interviewed the late Professor Frank Hibben (1910-2002), a retired University of New Mexico archaeologist, "who is convinced that the inscription is ancient and thus authentic. He reports that he first saw the text in 1933. At the time it was covered with lichen and patination and was hardly visible. He was taken to the site by a guide who had seen it as a boy, back in the 1880s." (Tabor 1997) At present the inscription itself is badly chalked and scrubbed up. However, Moorehouse compares the surviving weathering on the inscription to that on a nearby modern graffito dating itself to 1930. He concludes that the Decalogue inscription is clearly many times older than this graffito, and that 500 to 2000 years would not be an unreasonable estimate of its age.

The inscription uses Greek tau, zeta, delta, eta, and kappa (reversed) in place of their Hebrew counterparts taw, zayin, daleth, heth, and caph, indicating a Greek influence, as well as a post-Alexandrian date, despite the archaic form of aleph used. The letters yodh, qoph, and the flat-bottomed shin have a distinctively Samaritan form, suggesting that the inscription may be Samaritan in origin. See Lidzbarski (1902), Purvis (1968).

Cyrus Gordon (1995) proposes that the Los Lunas Decalogue is in fact a Samaritan mezuzah. The familiar Jewish mezuzah is a tiny scroll placed in a small container mounted by the entrance to a house. The ancient Samaritan mezuzah, on the other hand, was commonly a large stone slab placed by the gateway to a property or synagogue, and bearing an abridged version of the Decalogue. Gordon points out that prosperous Samaritan shipowners were known to live in Greek communities at the time of Theodosius I circa 390 A.D., and proposes that the most likely age of the Los Lunas inscription is the Byzantine period.

If Los Lunas is indeed a Byzantine Samaritan inscription, it may be significant that the sixth century historian Procopius reports that the Byzantine Emperor Justinian I (r. 527-565 A.D.) undertook a massive persecution of the Samaritans in particular, which

... threw Palestine into an indescribable turmoil. Those, indeed, who lived in my own Caesarea and in the other cities, deciding it silly to suffer harsh treatment over a ridiculous trifle of dogma, took the name of Christians in exchange for the one they had borne before, by which precaution they were able to avoid the perils of the new law. .... The country people, however, banded together and determined to take arms against the Emperor ... For a time they held their own against the imperial troops; but finally, defeated in battle, were cut down, together with their leader. Ten myriads [100,000] of men are said to have perished in this engagement, and the most fertile country on earth thus became destitute of farmers. ( Chapter 11, and in particular screens 52-54.)

Procopius elsewhere states that Justinian was responsible for the deaths of no less than three trillion (sic!) persons, so perhaps his estimate that 100,000 Samaritans were killed in this uprising may be a little inflated. Nevertheless, a persecution such as this, and perhaps this very one, may have been the impetus behind the Los Lunas Inscription. Pummer (1987, p. 4) reports that the uprising in question occurred in 529 A.D., and that "after the Muslim conquest of Palestine from 634 A.D. on, the Samaritan swere reduced even further in their numbers through massacres and conversions. Particularly under the Abbasids [750-1258 A.D.] their sufferings increased greatly." Although the Samaritans have survived into the 21st century, they were clearly more numerous and prosperous in the first millenium A.D. than the second.Further evidence of a Hellenistic or Byzantine influence on Los Lunas is provided by Skupin (1989). He analyzes the orthographic errors of the Los Lunas text itself, and concludes that it appears to have been written by a person whose primary language was Greek, who had a secondary, but verbal, comprehension of Hebrew. He writes of the inscriber,

He used the consonant [aleph] as if it were a vowel, like the Greek alpha, even though this clashes with the Hebrew orthographic system .... He confounded [qoph] and [caph] as a Philhellene who only knew kappa might do, and was sufficiently removed from Hebrew to be unaware that he had made an irreverent slip thereby. Most amazingly, he 'heard' macrons, the drawling long vowels that are structurally and semantically important in Greek ... and felt compelled to indicate them even if he was not exactly sure of how it's done (and rightly so, since in Hebrew they're insignificant).... His word order suggests a scriptural tradition related to a Greek version produced in Alexandria, Egypt, as does his spelling; and finally, he gives inordinate prominence to the words 'brought you out of Egypt.'

Skupin concludes,

None of this proves anything. Until confirmation comes from another quarter, all we can really do is provide a clearer idea of the stone's contents for those who are intrigued by it, and give those who reject the inscription's authenticity ... a deeper appreciation of what they have rejected.

Yet more evidence of Greco-Samaritan interactions is provided by Prof. Reinhard Pummer (1998, p. 29), who reports that "Ancient literature hints that Samaritan synagogues may have been located in Rome and Tarsus between the fourth and sixth centuries C.E. Short inscriptions in Samaritan and Greek script found in Thessalonica and Syracuse may have come from Samaritan synagogues in these cities during the same time period. Apparently, the Samaritans flourished in the Diaspora." One Samaritan synagogue in Palestine, at Sha'alvim, in Judea N.W. of Jerusalem, simultaneously bears religious inscriptions in Samaritan letters and secular inscriptions in Greek. Another at Tell Quasile in Tel Aviv shows considerable Greek architectural influence. (Ibid., p. 30.) In his book, Pummer reports that the Samaritan wedding service even today contains a few words of Greek, and that a Samaritan deed of divorce from Egypt, dating to 586 A.D., is written in Greek (1987, p. 19). A Samaritan inscription in the nethermost diaspora might therefore well exhibit some Greek attributes.It should be noted, however, that Pummer himself (personal communication, Aug. 31, 1998) does not believe that the Los Lunas inscription could be Samaritan. First, in Verse 8, the Los Lunas text follows the Masoretic (standard Jewish) text by saying "remember the Sabbath day to keep it holy," whereas the Samaritan text always says "preserve the Sabbath day to keep it holy." Second, the Samaritans added a clause to the tenth commandment calling for a temple to be built on Mt. Gerizim, but this clause is absent in Los Lunas. And third, although an inscription in Greek language written in Samaritan letters is known, he is not aware of Greek-style letters ever appearing in Samaritan inscriptions.

The stone is located on New Mexico state trust land, as indicated in the New Mexico State Land Office's webpage on the "Mystery Stone" at http://www.nmstatelands.org/GetPage.aspx?sectionID=39&PagID=186. Visitors are supposed to obtain a permit in advance, costing $25 per family, from the New Mexico State Land Office, 310 Old Santa Fe Trail, Santa Fe, NM 87504, (505) 827-5724. A copy of the permit application, with further details, is downloadable from http://www.nmstatelands.org/PDFs/crd_recpermit.pdf. [Links updated 7/24/06.] The site is about 1/2 mile south of State Route 6 at Rio Puerco, about 16 miles west of Los Lunas. A map and detailed directions are available from the State Land Office.

Ancient Hebrew Tablets found in New Mexico!!

The Los Lunas Decalogue Stone

The Los Lunas Inscription is an abridged version of the Decalogue or Ten Commandments, carved into the flat face of a large boulder resting on the side of Hidden Mountain, near Los Lunas, New Mexico, about 35 miles south of Albuquerque. The language is Hebrew, and the script is the Old Hebrew alphabet, with a few Greek letters mixed in. See Cline (1982), Deal (1984), Stonebreaker (1982), Underwood (1982), and/or Neuhoff (1999) for transcriptions and translation, and Deal (1984) for discussion and photographs of the setting.
George Moorehouse (1985), a professional geologist, indicates that the boulder is of the same basalt as the cap of the mesa. He estimates its weight at 80 to 100 tons, and says it has moved about 2/3 of the distance from the mesa top to the valley floor since it broke off. The inscription is tilted about 40 degrees clockwise from horizontal, indicating that the stone has settled or even moved from its position at the time it was inscribed. (The above photograph was taken with a tilted camera.)
In 1996, Prof. James D. Tabor of the Dept. of Religious Studies, University of North Carolina - Charlotte, interviewed the late Professor Frank Hibben (1910-2002), a retired University of New Mexico archaeologist, "who is convinced that the inscription is ancient and thus authentic. He reports that he first saw the text in 1933. At the time it was covered with lichen and patination and was hardly visible. He was taken to the site by a guide who had seen it as a boy, back in the 1880s." (Tabor 1997) At present the inscription itself is badly chalked and scrubbed up. However, Moorehouse compares the surviving weathering on the inscription to that on a nearby modern graffito dating itself to 1930. He concludes that the Decalogue inscription is clearly many times older than this graffito, and that 500 to 2000 years would not be an unreasonable estimate of its age.
The inscription uses Greek tau, zeta, delta, eta, and kappa (reversed) in place of their Hebrew counterparts taw, zayin, daleth, heth, and caph, indicating a Greek influence, as well as a post-Alexandrian date, despite the archaic form of aleph used. The letters yodh, qoph, and the flat-bottomed shin have a distinctively Samaritan form, suggesting that the inscription may be Samaritan in origin. See Lidzbarski (1902), Purvis (1968).
Cyrus Gordon (1995) proposes that the Los Lunas Decalogue is in fact a Samaritan mezuzah. The familiar Jewish mezuzah is a tiny scroll placed in a small container mounted by the entrance to a house. The ancient Samaritan mezuzah, on the other hand, was commonly a large stone slab placed by the gateway to a property or synagogue, and bearing an abridged version of the Decalogue. Gordon points out that prosperous Samaritan shipowners were known to live in Greek communities at the time of Theodosius I circa 390 A.D., and proposes that the most likely age of the Los Lunas inscription is the Byzantine period.
If Los Lunas is indeed a Byzantine Samaritan inscription, it may be significant that the sixth century historian Procopius reports that the Byzantine Emperor Justinian I (r. 527-565 A.D.) undertook a massive persecution of the Samaritans in particular, which

... threw Palestine into an indescribable turmoil. Those, indeed, who lived in my own Caesarea and in the other cities, deciding it silly to suffer harsh treatment over a ridiculous trifle of dogma, took the name of Christians in exchange for the one they had borne before, by which precaution they were able to avoid the perils of the new law. .... The country people, however, banded together and determined to take arms against the Emperor ... For a time they held their own against the imperial troops; but finally, defeated in battle, were cut down, together with their leader. Ten myriads [100,000] of men are said to have perished in this engagement, and the most fertile country on earth thus became destitute of farmers. ( Chapter 11, and in particular screens 52-54.)

Procopius elsewhere states that Justinian was responsible for the deaths of no less than three trillion (sic!) persons, so perhaps his estimate that 100,000 Samaritans were killed in this uprising may be a little inflated. Nevertheless, a persecution such as this, and perhaps this very one, may have been the impetus behind the Los Lunas Inscription. Pummer (1987, p. 4) reports that the uprising in question occurred in 529 A.D., and that "after the Muslim conquest of Palestine from 634 A.D. on, the Samaritan swere reduced even further in their numbers through massacres and conversions. Particularly under the Abbasids [750-1258 A.D.] their sufferings increased greatly." Although the Samaritans have survived into the 21st century, they were clearly more numerous and prosperous in the first millenium A.D. than the second.Further evidence of a Hellenistic or Byzantine influence on Los Lunas is provided by Skupin (1989). He analyzes the orthographic errors of the Los Lunas text itself, and concludes that it appears to have been written by a person whose primary language was Greek, who had a secondary, but verbal, comprehension of Hebrew. He writes of the inscriber,

He used the consonant [aleph] as if it were a vowel, like the Greek alpha, even though this clashes with the Hebrew orthographic system .... He confounded [qoph] and [caph] as a Philhellene who only knew kappa might do, and was sufficiently removed from Hebrew to be unaware that he had made an irreverent slip thereby. Most amazingly, he 'heard' macrons, the drawling long vowels that are structurally and semantically important in Greek ... and felt compelled to indicate them even if he was not exactly sure of how it's done (and rightly so, since in Hebrew they're insignificant).... His word order suggests a scriptural tradition related to a Greek version produced in Alexandria, Egypt, as does his spelling; and finally, he gives inordinate prominence to the words 'brought you out of Egypt.'

Skupin concludes,

None of this proves anything. Until confirmation comes from another quarter, all we can really do is provide a clearer idea of the stone's contents for those who are intrigued by it, and give those who reject the inscription's authenticity ... a deeper appreciation of what they have rejected.

Yet more evidence of Greco-Samaritan interactions is provided by Prof. Reinhard Pummer (1998, p. 29), who reports that "Ancient literature hints that Samaritan synagogues may have been located in Rome and Tarsus between the fourth and sixth centuries C.E. Short inscriptions in Samaritan and Greek script found in Thessalonica and Syracuse may have come from Samaritan synagogues in these cities during the same time period. Apparently, the Samaritans flourished in the Diaspora." One Samaritan synagogue in Palestine, at Sha'alvim, in Judea N.W. of Jerusalem, simultaneously bears religious inscriptions in Samaritan letters and secular inscriptions in Greek. Another at Tell Quasile in Tel Aviv shows considerable Greek architectural influence. (Ibid., p. 30.) In his book, Pummer reports that the Samaritan wedding service even today contains a few words of Greek, and that a Samaritan deed of divorce from Egypt, dating to 586 A.D., is written in Greek (1987, p. 19). A Samaritan inscription in the nethermost diaspora might therefore well exhibit some Greek attributes.It should be noted, however, that Pummer himself (personal communication, Aug. 31, 1998) does not believe that the Los Lunas inscription could be Samaritan. First, in Verse 8, the Los Lunas text follows the Masoretic (standard Jewish) text by saying "remember the Sabbath day to keep it holy," whereas the Samaritan text always says "preserve the Sabbath day to keep it holy." Second, the Samaritans added a clause to the tenth commandment calling for a temple to be built on Mt. Gerizim, but this clause is absent in Los Lunas. And third, although an inscription in Greek language written in Samaritan letters is known, he is not aware of Greek-style letters ever appearing in Samaritan inscriptions.
The stone is located on New Mexico state trust land, as indicated in the New Mexico State Land Office's webpage on the "Mystery Stone" at http://www.nmstatelands.org/GetPage.aspx?sectionID=39&PagID=186. Visitors are supposed to obtain a permit in advance, costing $25 per family, from the New Mexico State Land Office, 310 Old Santa Fe Trail, Santa Fe, NM 87504, (505) 827-5724. A copy of the permit application, with further details, is downloadable from http://www.nmstatelands.org/PDFs/crd_recpermit.pdf. [Links updated 7/24/06.] The site is about 1/2 mile south of State Route 6 at Rio Puerco, about 16 miles west of Los Lunas. A map and detailed directions are available from the State Land Office.

JPMorgan Loss Could Be $100 Billion, Next 'Shock' Event

The JP Morgan (JPM) trading blunder could result in a $100 billion loss, a contagion of its massive portfolio, and even the wipeout of its entire asset base. Even worse, these extremely risky and potentially-illegal actions on behalf of the CIO office and the "London Whale" could be the unexpected "shock" that breaks the market, derails the Fed's huge monetary stimulus, and sends us back into a global recession.

The JP Morgan Shock

The entire world has forgotten about or ignored what could be the upcoming "shock" that puts the global financial system in severe jeopardy. To make matters much, much worse - I don't think anyone even has a clue as to what is really happening. Investors, economists, financial powerhouses, top business executives, politicians, lawmakers, consumers, students, governments, and even central banks are completely confused. None of them are expecting what I will describe below.

There is one event that may ultimately solve the mystery of the global economy. This event would not only plunge the economy back into a deep recession and lose investors hundreds of billions of dollars, but it could bring about the collapse of some of the world's largest financial institutions and even render central bank stimulus and QE completely ineffective and futile. This event is by no means a guarantee; its probability is even likely under 5 percent. But this event has all the necessary ingredients to culminate into a major panic. Together with slowing global economies and an extremely unstable financial system, this could be the next Lehman Brothers.

This event is JP Morgan's huge trading mistake. The massive losses that were racked up starting in April and May 2012 are by no means over. What has been represented by JP Morgan as a trading mistake and "hedging" strategy with an initial estimated loss of $2 billion, was really a leveraged and speculative bet that could soon infect JP Morgan's entire portfolio and result in losses of $100 billion.

The Global Economy and Huge Underlying Risks

Most investors already know about the very weak economic growth, European financial crisis, Chinese slowdown, Middle East tensions, and dangerous Fed actions. All are huge threats and may drag the global economy into a double-dip recession. But most investors don't know if the fears are overblown; they don't know if central banks will be successful in boosting the economy; and they don't know the real risks out there. Most investors are either overly-optimistic, over-confident that they will be able to pull their money out quickly, following the crowd, or simply taking way too much risk unnecessarily. After a 115% + rally, and only 7% away from the all-time stock market highs, it's just not worth staying invested right now.

This was my warning to my friends on September 25, 2012:

Take your money out of stocks and gold NOW!!!

$SPY $GLD $AAPL $FB $GOOG $MCD $CAT $JPM

Way too much risk, stock market is only 7% away from the all-time highs (and the economy is nowhere near where it was), Apple has failed to stay above $700 and will potentially never make new highs ever again, Google might have just put in a top, Facebook continues to fail, China is slowing down tremendously and could enter recession, Europe has a financial crisis that is still unresolved, global growth and manufacturing is slowing (already at recession levels), massive debt could lead to financial collapse, the US Dollar is getting stronger, commodity prices are falling after over-speculation, oil prices failed to stay above $100 and signal a deflationary recession, and the Fed's actions have given investors too much confidence when they might not work at all.......Just not enough reward at all for the massive risk that you'd be taking.

All of the above reasons are absolutely enough to crush this market, but guess what? It could get even worse.

JP Morgan Loss

JP Morgan announced that its Chief Investment Office made a terrible trading error and lost $2 billion. The company said that the loss was due to a failed "hedging" and "protection" strategy and blamed it on trader Bruno Iksil, the "London Whale". At first, the company tried to deny or downplay these very negative rumors in order to prevent any panic. But by May 2012, losses of $2 billion were reported and the stock had lost a third of its value in two months, from early April to early June. On an emergency conference call, JP Morgan CEO Jamie Dimon announced that the strategy was "flawed, complex, poorly reviewed, poorly executed, and poorly monitored."

Jamie Dimon was called to testify in front of the Senate, and investigations were initiated by the Federal Reserve, the SEC, and the FBI. In July, the total loss was updated to $5.8 billion and the firm announced that they could total $9 billion under worst-case scenarios. But the problems have still not been solved! JP Morgan is still not out of the trade, and all of the investigations and testimonies have still not uncovered exactly what the trades were, how they resulted in such massive losses, and why such severe mistakes were not caught by top management.

It appears that the losses are still increasing and that JP Morgan is hiding a lot of important information. It is absolutely possible that a number of traders, risk managers, and even Jamie Dimon himself have engaged in illegal activities, misrepresented the real situation, and even lied to the public.

What's Really Happening?

• The Trades

JP Morgan's full list of positions is still unknown (because it could affect their ability to sell out of losing trades), but a few very important bets have been revealed. So far, it appears that the big losses were the result of two trades (though others are likely still to be uncovered).

Trade #1 was a smart hedge betting against the global economy, by having bearish positions on junk bonds (JNK) - one of the riskiest asset classes most sensitive to the condition of the economy. This position was a very good hedge because JP Morgan needs to protect itself from a potential economic downturn. If the economy deteriorated and stocks fell, JP Morgan would at least make up some losses by profiting from these bearish bets.

Trade #2 is where the real trouble stems from. Instead of hedging through bearish positions, Trade #2 actually bets on continued economic strength. Trade #2 was a bet that investment-grade bonds will not default - that strong corporations will continue to be financially stable and be able to pay off all of their obligations. JP Morgan's bet was that credit markets would strengthen. To make matters even worse, Trade #2 was based on the position that 2012 should be protected but that 2013-2017 would be safe (buying CDS protection for 2012, selling CDS protection out to 2017). In other words, JP Morgan was now betting that investment grade bonds would not default from 2013 to 2017. Moreover, Trade #2 was much bigger than Trade #1.

• How They Lost

The trades are highly dependent on the state of the economy. If conditions improved, JP Morgan would lose on its short position in junk bonds (because junk bonds would continue to gain) but would profit from its long position in investment-grade bonds (because these bonds would gain as well). And since Trade #2 was bigger than Trade #1, the gains on Trade #2 would offset the losses on Trade #1. Therefore, if the economy improved, JP Morgan would make a profit.

On the other hand, if economic conditions declined, JP Morgan would profit from its short position in junk bonds (which would be hard hit by a slowdown) but would lose on its long positions in investment-grade bonds (which would now be at greater risk of default). Because Trade #2 was much bigger than Trade #1, deteriorating economic conditions would result in a large loss.

JP Morgan's trades were a terrible "hedge" because they were much more geared for an improvement in economic conditions than for a deterioration. Therefore, when world financial markets fell into a slight panic over Europe's financial crisis and slowing global growth, JP Morgan lost billions of dollars on their trades. And it's not over.

Why They're Lying

There is a good chance that legal actions will soon follow. Not only did the Chief Investment Office make very serious trading errors and failed to oversee the trouble that was going on, but there is a fair possibility that a number of individuals in top-level management positions knew what was happening and failed to act. In fact, the CIO (Ina Drew), Chief Risk Officer (Irvin Goldman), and others have already been forced to resign. In my opinion, JP Morgan and a number of individual in high-level management have engaged in market manipulation, public misrepresentation, and conflicts of interest.

• "Hedge." First, calling these botched trades a "hedge" is hugely misleading and even a lie; these trades were not "protection," but an outright bullish and speculative bet on a European resolution and strength of the credit markets. JP Morgan made a massive bet on improving economic conditions instead of rightfully protecting itself from the threats of a recession.

And I'm not the only one who thinks so:

Monday, May 21, 1:35 PM JPMorgan's CIO losses can't be described "in any way as a hedge," says hedge fund giant Michael Platt, whose BlueCrest capital was on the other side of the trade. "It's a trading loss. They deliberately put the positions on." "They're not out of those positions," he says and will face further losses if Europe continues to deteriorate.

Source: Seeking Alpha, Market Currents

• Hiding Losses. Second, it appears that JP Morgan attempted to hide these losses from the public by either denying or minimizing early reports. Finally, when losses grew too large to hide, the company reported a $2 billion loss. Then, after investors had some time to digest the $2 billion loss reported in May, JP Morgan updated the loss to $5.8 billion in July.

• Misrepresenting Financial Results. Third, it is possible that JP Morgan attempted to hide the losses and manipulate investors by retroactively updating financial results, after it misrepresented them more positively. On July 13, 2012, it announced that it had a $4.4 billion loss in the second quarter and a "recalculation" of first quarter results that resulted in a $1.4 billion loss. To me, it looks like JP Morgan pushed off announcing the losses until after first quarter results were announced, and then tried to quietly tuck some of those losses into Q1 only afterwards - when investors weren't paying much attention. To me, it looks like JP Morgan has been trying to cover up its mistakes.

• Faulty Accounting and Valuation. Fourth, JP Morgan manipulated valuations and attempted to decrease the reported loss through faulty accounting standards - valuing thinly-traded positions as more marketable, failing to discount for illiquidity, using incorrect price estimates, and not updating changes in valuations (ZUCKERMAN, GREGORY; DAN FITZPATRICK (August 3, 2012). "J.P. Morgan 'Whale' Was Prodded Bank's Probe Concludes Trader's Boss Encouraged Boosting Values of Bets That Were Losing").

• Conflicts of Interest. Fifth, there are major conflicts of interest at JP Morgan. Not only is CEO Jamie Dimon a board member of the Federal Reserve Bank of NY (why is a top bank CEO so heavily influential on a government institution?), but the biggest campaign donor to many members on the Senate's banking committee - JP Morgan Chase. (Huffington Post, JP Morgan Chase and The Senate Banking Committee Are Best Friends).

• Pointing The Blame. Finally, even though JP Morgan has placed the blame on the "London Whale" and the Chief Investment Office, it is CEO Jamie Dimon who deserves a lot of the blame as well. It is the role of the CEO to oversee what goes on and even to sign off on financial documents that they are accurate (Sarbanes-Oxley). Dimon told lawmakers that the loss was an "isolated incident," but it is more likely that there is much more brewing under the surface.

Why It Could Get Much Worse

The $5.8 billion loss that has officially been announced is by no means the final count. Not only have we seen the loss rise from $2 billion to $4 billion to $5.8 billion, but JP Morgan still hasn't exited from its positions. There are a number of reasons why this loss could quickly spiral out of control.

• Still Not Out of Bets. The official announced losses are "only" $5.8 billion, but JP Morgan still hasn't exited from all of its risky positions. In fact, even though JP Morgan's losses have been estimated to be as much as $9 billion under worst case scenarios, this is according to JP Morgan's own internal report. Why should we believe what JP Morgan tells us? Obviously they underestimate their own losses.

Moreover, the company is holding positions in derivatives with a face value of $100 billion. Not only are these positions betting on the health of corporate debt and relying on improved economic conditions, but these positions are very illiquid. JP Morgan holds a major chunk of this market, and it's had a very hard time unloading its bets.

Unwinding these bets could put JP Morgan at tremendously high risk:

J.P. Morgan's decision to move slowly in unwinding the positions highlights a painful dilemma for the company and Chief Executive James Dimon: The bank can move slowly and risk being bled by small but regular losses over time, or it can attempt to close out the trades sooner but face potentially larger losses. Moving slowly also holds risks if the market turns sharply against the bank in the near term.

Source: WSJ: JP Morgan Struggles To Unwind Huge Bets

• Sold Protection Maturing in 2017. Perhaps the dumbest move for JP Morgan was its failure to protect itself from a recession or economic slowdown. Instead of buying protection, JP Morgan actually sold protection. Though it bought protection for 2012, it sold protection for 2013-2017 - definitely not a position that would save it if a recession took hold. If economic conditions deteriorate, JP Morgan is in a tremendously dangerous position; it not only failed to protect itself for the next few years, but it even made bullish bets by selling that protection. If it can't unload its positions soon, an economic slowdown could wipe out its entire portfolio as the 2013-2017 protection soars in value and blows up in JP Morgan's face (the positions lost JP Morgan a minimum of 24% in just over a week - WSJ, ibid).

• Regulators Still Haven't Figured It Out. Regulators such as the OCC and SEC have attempted to find out exactly what has happened and how much risk is still out there, but they have likely been looking at "the same models that the bank itself was using (WSJ, ibid.)." It seems that the regulators themselves still have a lot to find out, and the $9 billion max-loss estimated by JP Morgan itself is not likely accurate.

• Way More Than $10 Billion At Risk. While Jamie Dimon insists that Iksil (The London Whale) made a risky $10 billion bet in an illiquid debt index, and that this is an "isolated incident," there may bemuch more at risk than the measly $10 billion.

In fact, the CIO's job was to "invest the difference between the $1.1 trillion in deposits the bank has on hand from its customers and the $750 billion the bank has lent out to corporate borrowers (Bloomberg, Exactly Whose Money Did The London Whale Lose?)." That leaves $350 billion that was under the direction of CIO Ina Drew, who has since been forced to resign. Dimon claims that the bad trade was limited to the $10 billion bet by the London Whale, but a number of factors point to this mess potentially affecting way more than just $10 billion.

First, we've already heard that JP Morgan's position in risky, illiquid debt derivatives has had a face value of $100 billion; Iksil's position may have been $10 billion, but somehow JP Morgan attained a $100 billion risk exposure. Second, even if just a $10 billion position was taken, if it is highly-leveraged it could wipe out much of the value of JP Morgan's other assets.

Haven't we learned the lessons of the giant financial collapses of Lehman Brothers, Bear Stearns, Merrill Lynch, AIG, MF Global, and others? Haven't we already seen how leveraged, "isolated" bets can bring down entire corporations? Even if JP Morgan's bet was limited to $10 billion (which it likely wasn't, because we've already heard of the $100 billion in risky positions), its leveraged losses could infect the entire $350 billion CIO portfolio. It is completely possible that the contagion will spread, the $6 billion in losses will continue to grow, the $100 billion in risky positions will collapse, and JP Morgan's $350 billion CIO portfolio will be severely affected.

• Depositors' Money At Risk? It is not even a stretch to say that depositors' money is at risk (Bloomberg). If the botched position is still uncovered, it could potentially infect the rest of the CIO's portfolio - and even wipe out JP Morgan's entire capital base.

"Essentially, JP Morgan has been operating a hedge fund with federal insured deposits within a bank," said Mark Williams, a professor of finance at Boston University, who also served as a Federal Reserve bank examiner.

Source: NYT DealBook, JPMorgan Trading Loss May Reach $9 Billion

• Could Derail Fed's Monetary Policy. If JP Morgan's losses really do begin to escalate, they affect much more than just JP Morgan. As one of the largest "too big to fail" banks, JP Morgan has benefited tremendously from the added liquidity that the Fed has brought to the markets. The Fed's mission was to increase lending, improve banks' balance sheets, and give "easy money" to these institutions in order to boost the economy. There is no doubt that the Fed's stimulus has bolstered companies like JP Morgan , Bank of America (BAC), AIG (AIG), Wells Fargo (WFC), Goldman Sachs (GS), Citigroup (C), and many financials (XLF). But if JP Morgan goes down, the repercussions will be much greater than in 2008. The economy is not ready to deal with another huge shock. This time, the contagion would be much greater, and the government will not have the capacity to protect failing firms. A collapse of a too-big-to-fail bank would destroy confidence and undermine the Fed's monetary policy.

How You Could Have Seen This Coming

Though it is impossible to predict events exactly, sometimes there are enough clues that point to good or bad news that may soon come. Sometimes there are rumors, improving or deteriorating financials, upcoming catalysts, and a number of hints which signal that momentum is shifting. Sometimes these are positive developments, pointing to an explosive surge in the company's stock, and sometimes these are negative developments, pointing to an upcoming crash. In the case of JP Morgan, there were reasons to watch out.

1. Hedge Funds Take Other Side. In early 2012, hedge funds such as Saba Capital and Blue Mountain Capital made billions by taking the opposite side of the trade when they noticed that JP Morgan was affecting the market and making aggressive bets. Anyone who paid attention could have noticed that something was going on.

2. Jamie Dimon Against Higher Capital Requirements. In June 2011, Dimon became a "Wall Street Hero" when he boldly questioned Bernanke about whether too much bank regulation - especially the higher capital requirements - would affect the economy and prevent a full recovery.

"Now we're told there are going to be even higher capital requirements, and we know there are 300 rules coming, has anyone bothered to study the cumulative effect of these things? And do you have a fear-like I do-that when we look back and look at them all, that they will be the reason that it took so long for our banks, our credit, our businesses, and most importantly, our job creation, to start going again? Is this holding us back at this point?"

Source: CNBC, Jamie Dimon Becomes Wall Street s Hero Figure

Bernanke didn't have much to say other than that they are doing everything they can to "develop a system that is coherent and that is consistent with banks performing their vital social function in terms of extending credit."

Wall Street considered Jamie Dimon a hero, but Dimon's rejection of higher capital requirements should have been a warning. Higher capital requirements are a smart and likely effective way of reducing banks' risk-taking. By increasing capital requirements, the banks would be forced to hold more reserves on hand in order to protect them in case of a sudden downturn or financial distress. This is exactly what we need! Without higher capital requirements, banks are just leveraging their money even more - taking way more risk than they can afford.

Jamie Dimon was basically saying: "Please allow us to bet or loan $1000 when we only really have $100." In other words, Dimon wanted an expansion of banks' financial power without having to increase the safety. By decreasing capital requirements, banks would be able to decrease the amount of money they used as collateral - the "money multiplier" would allow banks to essentially create money out of nowhere and increase lending and investments - which helps banks make more profits and would hopefully help boost the economic recovery. However, if anything goes wrong, the billions (or trillions) of dollars of new loans and investments could collapse in value. And if all of these new loans and investments have been made on "margin" through leverage and monetary expansion, there isn't enough capital to cover the losses - their entire business could be wiped out.

If we actually paid attention to what Jamie Dimon said that day, we could have seen that he wanted more leeway and more power for the banks. Perhaps banks needed more power in order to help the economy, but decreasing the capital requirements and giving banks more room for leverage is exactly what leads to huge financial catastrophes like Lehman Brothers. It was obvious that Dimon was paving the way for increased risk-taking by the banks. And that mindset is what ultimately led to this JP Morgan fiasco.

Dimon's actions in June 2011 foreshadowed this trading loss:

The enormous loss JPMorgan announced today is just the latest evidence that what banks call "hedges" are often risky bets that so-called "too big to fail" banks have no business making.

-Senator Carl Levin, Michigan (D)

Source: NYT DealBook. SEC Opens Investigation Into JPMorgan s $2 Billion Loss

3. Eight Technical Failures. Perhaps the most obvious sign that JP Morgan was about to drop, was the consistent technical failure in the charts. Every time JP Morgan's stock approached $45 or $46, it failed. Looking back all the way to 2007, the $45-$46 level was like a brick wall that completely blocked the stock every time. This could be one of the easiest bets a short-seller could ever make. If you just looked at the 5-year chart of JPM in April 2012, you'd notice that we were approaching major resistance overhead. Every single time we rose to this level, we fell; and in late 2008, we fell from over $45 to almost $14.

All one had to do was see if JPM could break above and stay above $46. If it did, JPM would be a decent long position at very low risk, with a brand new support at $45. But if it failed (and it did), JPM would be a good short. This massive resistance was so powerful, that JPM actually failed once again. Not only that, but it failed in late March - investors had over a month to notice this and short the stock! Technicals were signaling a massive warning even before the bad news reached the public.

(Click to enlarge)

Conclusion

All of these facts and clues are still to be determined. JP Morgan may in fact work everything out and escape with under $10 billion in losses. A lot of what I've written is opinion based on the available facts, and the probability of the collapse of a giant financial institution is still extremely low. But there are simply way too many unresolved issues still to be dealt with; there are way too many unanswered questions to be answered by Jamie Dimon and regulators.

JP Morgan was lucky that the bad news came out right before the summer, and that the "summer doldrums" helped investors and lawmakers forget about the massive trouble that may be underway. JP Morgan and CEO Jamie Dimon have been completely silent about this for a few months now, and the stock has recovered all of its losses since the news broke out. Technically, this looks like a "pullback" before the next plunge. The stock may have room to rise, but after such terrible news it is hard to see how it can sustain new highs. To make matters worse, JPM was included in Goldman's Hedge Fund Very Important Position list andGoldman Sachs' VIP List of 50 stocks most important to hedge funds. If JPM suffers, you can bet that most hedge funds, pension funds, and investors will suffer as well.

I repeat: QE and central bank stimulus could turn out to be a great success that saves our economy. But the risks of investing just far outweigh the potential rewards at this point. If you're smart, you'll avoid or short this market and miss out on a maximum 7% upside move if stocks continue to rise (and then get in at minimum risk if we exceed the 2007 highs). By doing so, you'll also save yourself from a devastating 20-50% drop in stocks if the situation deteriorates. I understand we all want to grow our wealth and make money through investing in order to improve our lifestyle, fund our retirement, support our children, and have the ability to do what we want. But at this point, staying long is just being greedy.