une 21, 2012 7:38 PM EDT
Ecuador is reviewing Wikileaks founder Julian Assange's asylum plea, President Rafael Correa said Thursday.
The president told the BBC Ecuador would make a "sovereign decision" after examining claimed threats to Assange's life.
The whistleblower activist is spending his third night holed up in Ecuador's London embassy, where he is seeking diplomatic asylum to prevent him being sent to Sweden to answer accusations of rape and assault, which he denies. He says he fears Sweden will turn him over to the U.S.
On Thursday, Assange said there was no guarantee his bid would succeed. In an interview with his homeland's Australian Broadcasting Corp. radio, he said he did not know when the decision would be made.
He said he had mounted his bid because his native Australia had made an "effective declaration of abandonment" by refusing to intervene in his planned extradition.
He had "heard that the Ecuadorians were sympathetic in relation to my struggles and the struggles of the organization with the United States," Assange said.
In a later phone interview with the Australian broadcaster Friday, Assange said he was ready for a life in Ecuador and said the country had been "quite supportive" of his bid for asylum, Reuters reported.
"The Ecuadorean people have been quite supportive. I heard [the] Ecuadorean ambassador in Australia has been making supportive comments," he said. "They are sympathetic over a long period of time.
"We hope the asylum application will be viewed favorably. Now it is a matter of gathering extensive evidence of what is happening in the U.S. and submitting that with a formal request."
He said he was not running away from questioning over the sex assault allegations in Sweden but said the Swedish prosecutors had refused to visit him in Britain or contact him by phone.
"This issue is about a very serious matter in the United States," he said, adding Swedish authorities said he would be detained on arrival.
Assange said his case was currently before a U.S. grand jury, which would decide whether charges could be laid. He said U.S. authorities have been careful not to confirm or deny any grand jury investigation.
"There are subpoenas everywhere. We have received subpoenas; there are subpoenas in my name," he said, asserting that people have been detained at U.S. airports and been questioned by the FBI and asked to become informers.
To report problems or to leave feedback about this article, e-mail: e.linton@ibtimes.com
To contact the editor, e-mail: editor@ibtimes.com
El Conquistqdor Francisco de Orellana
The Conquistador who put the Amazaon baisn "on the map"....Francisco Orellana
Friday, June 22, 2012
Wednesday, June 20, 2012
Señora Assange.....Ecuador is NOT Third World.....
The drama continues.........
Julian Assange’s Artful Dodge
Exclusive: Faced with extradition from London to Sweden to face sex-abuse allegations, WikiLeaks founder Julian Assange fled to the Ecuadorian embassy and asked for asylum, what ex-CIA analyst Ray McGovern considers an artful dodge to avoid possible U.S. persecution.
By Ray McGovern
Barring a CIA drone strike on the Ecuadorian embassy in London, WikiLeaks founder Julian Assange’s sudden appeal for asylum there may spare him a prison stay in Sweden or possibly the United States. Assange’s freedom now depends largely on Ecuadorian President Rafael Vicente Correa Delgado, a new breed of independent-minded leader like Venezuelan President Hugo Chávez.
Correa has been a harsh critic of U.S. behavior toward Ecuador and its Latin American neighbors as well as an outspoken fan of WikiLeaks. Atypically for the region, Ecuador is not a major recipient of U.S. economic or military aid, so Washington’s leverage is limited. This suggests that the Ecuadorian government may decide to defy Washington, accept Assange’s request for asylum, and have him flown to Ecuador pronto.
In which case, most British “justice” officials will probably say good riddance and breathe a sigh of relief — literally. They have been holding their noses for weeks against the odor of their obeisance to U.S. diktat, after the British High Court rejected Assange’s argument that he should not be extradited to Sweden.
Although Swedish “justice” officials have not charged Assange with any crime, they insist that he be extradited to face questions resulting from allegations by two women of sexual assault. This is widely — and in my view correctly — perceived as a subterfuge to deliver Assange into Swedish hands to facilitate his eventual extradition to the U.S. to face even more serious charges for publishing classified information highly embarrassing to Washington.
There have been persistent reports that Assange has been the target of a secret grand jury investigating disclosures of classified U.S. documents allegedly slipped to WikiLeaks by Army Pvt. Bradley Manning. A leaked 2011 e-mail from Fred Burton, a vice president of the private intelligence firm Stratfor, informed colleagues that “we have a sealed indictment on Assange,” but that claim has not been confirmed. Manning, however, is facing a court martial for allegedly leaking U.S. documents to WikiLeaks.
Giving the Brits the Slip
Interesting, is it not, that Assange — just days before he was to be extradited to Sweden — was able to (I guess) slip out of his ankle monitor, sneak through the cordon of Bobbies on watch at the estate where he was under house arrest, dodge other Bobbies and security chaps, and hit pay dirt inside the Ecuadorian embassy.
There is no denying that Assange is a clever chap. But unless you think him some kind of Houdini, there has to be some more likely explanation as to how he slipped through the various police checkpoints and walked into the embassy, which is located behind the popular Harrods department store in London.
Were the British security forces all out for tea? Or were they just as happy to have the Assange case – and all the pressure from Washington – focused elsewhere?
Certainly, the British had enough clues that, in extremis, Assange might attempt to make it to the Ecuadorian embassy. In late November 2010, Ecuadorian Deputy Foreign Minister Kintoo Lucas publicly offered Julian Assange residency in Ecuador, saying that Ecuador was “very concerned” by information revealed by WikiLeaks linking U.S. diplomats with spying on friendly governments.
“We are open to giving him residency in Ecuador, without any problem and without any conditions,” Mr. Lucas said.
President Correa promptly backtracked, saying that Kintto Lucas’s remarks were unauthorized and that no formal invitation had been extended to Assange, and noting that residency for him would require legal review in the event he requested it. (This came just one week before Assange was arrested, imprisoned, and then put under house arrest.)
Now I’m Requesting It
Ecuador’s embassy in London, announcing Assange’s arrival Tuesday afternoon, said he was seeking asylum, and added:
“As a signatory to the United Nations Universal Declaration for Human Rights, with an obligation to review all applications for asylum, we have immediately passed his application on to the relevant department in Quito,” Ecuador’s capital. “While the department assesses Mr. Assange’s application, Mr. Assange will remain at the embassy, under the protection of the Ecuadorian government.”
The embassy added that the bid for asylum “should in no way be interpreted as the government of Ecuador interfering in the judicial processes of either the United Kingdom or Sweden.”
Temporizing diplomatic phrasing of this kind seems de rigueur, as President Correa and his associates take time to choose how to react to the fait accompli of Julian Assange in Ecuador’s custody. In Quito, Ecuadorian Foreign Minister Ricardo Patino told reporters that his country “is studying and analyzing the request [for asylum].”
Like Mother, Like Son
Assange’s mother not only applauded her son’s decision to seek asylum, but summed up the situation concisely, telling the press:
“I hope Ecuador will grant him asylum, and if not, another third-world country. I hope the third world can stand up for what’s morally right when the first world can’t and won’t because they’ve got their snouts in the trough, rolling over for U.S. greed and big business.
“Julian is a political prisoner, a journalist, a publisher of the truth about corruption, war crimes, kidnapping, blackmail, and manipulation. … He remains uncharged and unquestioned on a crime which, if you explore it, has absolutely no basis. Of course he would seek asylum.”
She added that her son was a victim of decisions by the United States, Britain, Sweden and Australia to abandon proper legal process.
How 20th Century!
Abandoning proper legal process? Such thinking seems so — to borrow words from the eminent legal scholar Alberto Gonzales — so “quaint,” so “obsolete,” so pre-9/11! Abandoning proper legal process post-9/11 has become the “new paradigm” adopted not only by the Bush, but also by the Obama administration.
Not only is Julian Assange within his rights to seek asylum, he is also in his right mind. Consider this: he was about to be sent to faux-neutral Sweden, which has a recent history of bowing to U.S. demands in dealing with those that Washington says are some kind of threat to U.S. security. Glenn Greenwald on Tuesday provided an example:
“In December 2001, Sweden handed over two asylum seekers to the CIA, which then rendered them to be tortured in Egypt. A ruling from the U.N. Human Rights Committee found Sweden in violation of the global ban on torture for its role in that rendition (the two individuals later received a substantial settlement from the Swedish government).”
For those of you thinking, Oh, but that was under the Bush administration and that kind of thing is over, think again. In 2010 and 2011, the hysteria surrounding WikiLeaks’ disclosures of U.S. misconduct and crimes around the world brought cries from prominent American political figures seeking Assange’s designation as a terrorist, his prosecution as a spy and even his assassination.
Rep. Peter King, R-New York, chairman of the House Homeland Security Committee, has called for WikiLeaks to be declared a terrorist organization and Assange to be prosecuted under the Espionage Act of 1917, a position shared by Sen. Dianne Feinstein, D-California, chair of the Senate Intelligence Committee, who wrote in a Wall Street Journal op-ed:
“The release of these documents damages our national interests and puts innocent lives at risk. He should be vigorously prosecuted for espionage.”
Others have gone even further, demanding that Assange be put to death, either by judicial or extrajudicial means. For instance, a former Canadian official Tom Flanagan has urged Assange’s assassination.
Former Alaska governor Sarah Palin denounced Assange as an “anti-American operative with blood on his hands” and said he should be treated no differently than an al-Qaeda terrorist.
In a Facebook posting, Palin said Assange was no more a journalist than “the ‘editor’ of al-Qaida’s new English-language magazine Inspire is a ‘journalist.’” She added: “His past posting of classified documents revealed the identity of more than 100 Afghan sources to the Taliban. Why was he not pursued with the same urgency we pursue al-Qaida and Taliban leaders?”
So, put yourself in Julian Assange’s place. If the New York Times accurately described President Barack Obama as saying it was an “easy” decision to authorize the killing of Anwar al-Awlaki, a U.S. citizen alleged to have participated in terrorist operations against U.S. targets, how confident would you be that the onetime constitutional scholar would resist the political pressure to get rid of you?
A drone strike over London can be ruled out. But Assange understandably could fear a covert operation by Britain’s FBI and CIA counterparts — MI-5 and MI-6 — to eliminate him “with extreme prejudice,” in old CIA parlance.
As melodramatic as that might sound, it should be remembered that nine years have gone by since British Ministry of Defense biologist and U.N. weapons inspector Dr. David Kelly’s “suicide.” Yet there remains considerable circumstantial evidence that his “suicide” was not self-inflicted.
Kelly was found “guilty” of disclosing accurate information regarding the bogus nature of the “evidence” of Iraqi WMD and, conveniently, was removed from the scene, supposedly by his own hand. Ecuadorian embassy dwellers may wish to hire beefeaters to taste the foie gras, truffles, or cakes ordered from nearby Harrods.
Correa on TV With Assange
Four weeks before Assange sought asylum, he interviewed Ecuadorian President Rafael Correa for Episode 6 of The World Tomorrow (Assange’s program Tuesdays on RT). Assange asked Correa why he has advocated that WikiLeaks release all its cables. Correa responded:
“First, you don’t owe anything, have nothing to fear. We have nothing to hide. Your WikiLeaks have made us stronger” with the damaging revelations showing the attitude of the U.S. embassy toward the sovereignty of the Ecuadorian government.
Correa continued: “On the other hand, WikiLeaks wrote a lot about the goals that the national media pursue, about the power groups who seek help and report to foreign embassies. … Let them publish everything they have about the Ecuadorian government. You will see how many things about those who oppose the civil revolution in Ecuador will come to light. Things to do with opportunism, betrayal, and being self serving.”
Correa made the point that when WikiLeaks cables became available to the national media in Ecuador, they chose not to publish them — partly because the documents aired so much “dirty linen” about the media themselves. He added that when he took office in January 2007, five out of seven privately owned TV channels in Ecuador were run by bankers. The bankers were using the guise of journalism to interfere in politics and to destabilize governments, for fear of losing power.
Ecuador and the United States
Correa, 49, educated in Belgium at the Université Catholique de Louvain and at the University of Illinois at Urbana/Champaign (for four years, where he earned both a masters and a PhD), said he “admires the American people a great deal.” But the U.S. government can be a different matter.
Assange and Correa discussed Correa’s decision to send the U.S. ambassador, Heather Hodges, packing as a result of the disclosures in the WikiLeaks cables, as well as her “arrogance,” and the Ecuadorian president’s unilateral closure of the U.S. military base at Manta.
Still, Correa seems to have had high hopes that things would improve under the Obama administration. The Ecuadorian president once commented that Hugo Chávez’s description of George W. Bush as Satan was unfair to the Devil and that the previous administration had made Latin America “invisible.”
Regarding Ecuador’s general relationship with the U.S., Correa underscored on Assange’s program that it must be “a framework of mutual respect and sovereignty.” That wished-for mutual respect and especially Washington’s regard for Ecuadorian sovereignty are likely to be put to the test in the coming weeks.
Hillary Clinton may be having second thoughts about the energy she expended earlier this month on her first visit to Sweden as Secretary of State. If Assange succeeds in skirting Sweden and makes it to Ecuador, she may now have to put Quito back on her travel schedule.
A Clinton visit to Ecuador two years ago was marred by protests, but she found President Correa a gracious host. But that was before WikiLeaks disclosed Ambassador Hodges’s pejorative comments on Correa et al. and Correa decided to expel her from the country for “arrogance.”
Correa does seem to have developed an allergy to arrogance, so Clinton may wish to consider sending someone in her stead to try to persuade Ecuador to surrender Assange to the tender mercies of American “justice.”
Julian Assange’s Artful Dodge
Exclusive: Faced with extradition from London to Sweden to face sex-abuse allegations, WikiLeaks founder Julian Assange fled to the Ecuadorian embassy and asked for asylum, what ex-CIA analyst Ray McGovern considers an artful dodge to avoid possible U.S. persecution.
By Ray McGovern
Barring a CIA drone strike on the Ecuadorian embassy in London, WikiLeaks founder Julian Assange’s sudden appeal for asylum there may spare him a prison stay in Sweden or possibly the United States. Assange’s freedom now depends largely on Ecuadorian President Rafael Vicente Correa Delgado, a new breed of independent-minded leader like Venezuelan President Hugo Chávez.
Correa has been a harsh critic of U.S. behavior toward Ecuador and its Latin American neighbors as well as an outspoken fan of WikiLeaks. Atypically for the region, Ecuador is not a major recipient of U.S. economic or military aid, so Washington’s leverage is limited. This suggests that the Ecuadorian government may decide to defy Washington, accept Assange’s request for asylum, and have him flown to Ecuador pronto.
In which case, most British “justice” officials will probably say good riddance and breathe a sigh of relief — literally. They have been holding their noses for weeks against the odor of their obeisance to U.S. diktat, after the British High Court rejected Assange’s argument that he should not be extradited to Sweden.
Although Swedish “justice” officials have not charged Assange with any crime, they insist that he be extradited to face questions resulting from allegations by two women of sexual assault. This is widely — and in my view correctly — perceived as a subterfuge to deliver Assange into Swedish hands to facilitate his eventual extradition to the U.S. to face even more serious charges for publishing classified information highly embarrassing to Washington.
There have been persistent reports that Assange has been the target of a secret grand jury investigating disclosures of classified U.S. documents allegedly slipped to WikiLeaks by Army Pvt. Bradley Manning. A leaked 2011 e-mail from Fred Burton, a vice president of the private intelligence firm Stratfor, informed colleagues that “we have a sealed indictment on Assange,” but that claim has not been confirmed. Manning, however, is facing a court martial for allegedly leaking U.S. documents to WikiLeaks.
Giving the Brits the Slip
Interesting, is it not, that Assange — just days before he was to be extradited to Sweden — was able to (I guess) slip out of his ankle monitor, sneak through the cordon of Bobbies on watch at the estate where he was under house arrest, dodge other Bobbies and security chaps, and hit pay dirt inside the Ecuadorian embassy.
There is no denying that Assange is a clever chap. But unless you think him some kind of Houdini, there has to be some more likely explanation as to how he slipped through the various police checkpoints and walked into the embassy, which is located behind the popular Harrods department store in London.
Were the British security forces all out for tea? Or were they just as happy to have the Assange case – and all the pressure from Washington – focused elsewhere?
Certainly, the British had enough clues that, in extremis, Assange might attempt to make it to the Ecuadorian embassy. In late November 2010, Ecuadorian Deputy Foreign Minister Kintoo Lucas publicly offered Julian Assange residency in Ecuador, saying that Ecuador was “very concerned” by information revealed by WikiLeaks linking U.S. diplomats with spying on friendly governments.
“We are open to giving him residency in Ecuador, without any problem and without any conditions,” Mr. Lucas said.
President Correa promptly backtracked, saying that Kintto Lucas’s remarks were unauthorized and that no formal invitation had been extended to Assange, and noting that residency for him would require legal review in the event he requested it. (This came just one week before Assange was arrested, imprisoned, and then put under house arrest.)
Now I’m Requesting It
Ecuador’s embassy in London, announcing Assange’s arrival Tuesday afternoon, said he was seeking asylum, and added:
“As a signatory to the United Nations Universal Declaration for Human Rights, with an obligation to review all applications for asylum, we have immediately passed his application on to the relevant department in Quito,” Ecuador’s capital. “While the department assesses Mr. Assange’s application, Mr. Assange will remain at the embassy, under the protection of the Ecuadorian government.”
The embassy added that the bid for asylum “should in no way be interpreted as the government of Ecuador interfering in the judicial processes of either the United Kingdom or Sweden.”
Temporizing diplomatic phrasing of this kind seems de rigueur, as President Correa and his associates take time to choose how to react to the fait accompli of Julian Assange in Ecuador’s custody. In Quito, Ecuadorian Foreign Minister Ricardo Patino told reporters that his country “is studying and analyzing the request [for asylum].”
Like Mother, Like Son
Assange’s mother not only applauded her son’s decision to seek asylum, but summed up the situation concisely, telling the press:
“I hope Ecuador will grant him asylum, and if not, another third-world country. I hope the third world can stand up for what’s morally right when the first world can’t and won’t because they’ve got their snouts in the trough, rolling over for U.S. greed and big business.
“Julian is a political prisoner, a journalist, a publisher of the truth about corruption, war crimes, kidnapping, blackmail, and manipulation. … He remains uncharged and unquestioned on a crime which, if you explore it, has absolutely no basis. Of course he would seek asylum.”
She added that her son was a victim of decisions by the United States, Britain, Sweden and Australia to abandon proper legal process.
How 20th Century!
Abandoning proper legal process? Such thinking seems so — to borrow words from the eminent legal scholar Alberto Gonzales — so “quaint,” so “obsolete,” so pre-9/11! Abandoning proper legal process post-9/11 has become the “new paradigm” adopted not only by the Bush, but also by the Obama administration.
Not only is Julian Assange within his rights to seek asylum, he is also in his right mind. Consider this: he was about to be sent to faux-neutral Sweden, which has a recent history of bowing to U.S. demands in dealing with those that Washington says are some kind of threat to U.S. security. Glenn Greenwald on Tuesday provided an example:
“In December 2001, Sweden handed over two asylum seekers to the CIA, which then rendered them to be tortured in Egypt. A ruling from the U.N. Human Rights Committee found Sweden in violation of the global ban on torture for its role in that rendition (the two individuals later received a substantial settlement from the Swedish government).”
For those of you thinking, Oh, but that was under the Bush administration and that kind of thing is over, think again. In 2010 and 2011, the hysteria surrounding WikiLeaks’ disclosures of U.S. misconduct and crimes around the world brought cries from prominent American political figures seeking Assange’s designation as a terrorist, his prosecution as a spy and even his assassination.
Rep. Peter King, R-New York, chairman of the House Homeland Security Committee, has called for WikiLeaks to be declared a terrorist organization and Assange to be prosecuted under the Espionage Act of 1917, a position shared by Sen. Dianne Feinstein, D-California, chair of the Senate Intelligence Committee, who wrote in a Wall Street Journal op-ed:
“The release of these documents damages our national interests and puts innocent lives at risk. He should be vigorously prosecuted for espionage.”
Others have gone even further, demanding that Assange be put to death, either by judicial or extrajudicial means. For instance, a former Canadian official Tom Flanagan has urged Assange’s assassination.
Former Alaska governor Sarah Palin denounced Assange as an “anti-American operative with blood on his hands” and said he should be treated no differently than an al-Qaeda terrorist.
In a Facebook posting, Palin said Assange was no more a journalist than “the ‘editor’ of al-Qaida’s new English-language magazine Inspire is a ‘journalist.’” She added: “His past posting of classified documents revealed the identity of more than 100 Afghan sources to the Taliban. Why was he not pursued with the same urgency we pursue al-Qaida and Taliban leaders?”
So, put yourself in Julian Assange’s place. If the New York Times accurately described President Barack Obama as saying it was an “easy” decision to authorize the killing of Anwar al-Awlaki, a U.S. citizen alleged to have participated in terrorist operations against U.S. targets, how confident would you be that the onetime constitutional scholar would resist the political pressure to get rid of you?
A drone strike over London can be ruled out. But Assange understandably could fear a covert operation by Britain’s FBI and CIA counterparts — MI-5 and MI-6 — to eliminate him “with extreme prejudice,” in old CIA parlance.
As melodramatic as that might sound, it should be remembered that nine years have gone by since British Ministry of Defense biologist and U.N. weapons inspector Dr. David Kelly’s “suicide.” Yet there remains considerable circumstantial evidence that his “suicide” was not self-inflicted.
Kelly was found “guilty” of disclosing accurate information regarding the bogus nature of the “evidence” of Iraqi WMD and, conveniently, was removed from the scene, supposedly by his own hand. Ecuadorian embassy dwellers may wish to hire beefeaters to taste the foie gras, truffles, or cakes ordered from nearby Harrods.
Correa on TV With Assange
Four weeks before Assange sought asylum, he interviewed Ecuadorian President Rafael Correa for Episode 6 of The World Tomorrow (Assange’s program Tuesdays on RT). Assange asked Correa why he has advocated that WikiLeaks release all its cables. Correa responded:
“First, you don’t owe anything, have nothing to fear. We have nothing to hide. Your WikiLeaks have made us stronger” with the damaging revelations showing the attitude of the U.S. embassy toward the sovereignty of the Ecuadorian government.
Correa continued: “On the other hand, WikiLeaks wrote a lot about the goals that the national media pursue, about the power groups who seek help and report to foreign embassies. … Let them publish everything they have about the Ecuadorian government. You will see how many things about those who oppose the civil revolution in Ecuador will come to light. Things to do with opportunism, betrayal, and being self serving.”
Correa made the point that when WikiLeaks cables became available to the national media in Ecuador, they chose not to publish them — partly because the documents aired so much “dirty linen” about the media themselves. He added that when he took office in January 2007, five out of seven privately owned TV channels in Ecuador were run by bankers. The bankers were using the guise of journalism to interfere in politics and to destabilize governments, for fear of losing power.
Ecuador and the United States
Correa, 49, educated in Belgium at the Université Catholique de Louvain and at the University of Illinois at Urbana/Champaign (for four years, where he earned both a masters and a PhD), said he “admires the American people a great deal.” But the U.S. government can be a different matter.
Assange and Correa discussed Correa’s decision to send the U.S. ambassador, Heather Hodges, packing as a result of the disclosures in the WikiLeaks cables, as well as her “arrogance,” and the Ecuadorian president’s unilateral closure of the U.S. military base at Manta.
Still, Correa seems to have had high hopes that things would improve under the Obama administration. The Ecuadorian president once commented that Hugo Chávez’s description of George W. Bush as Satan was unfair to the Devil and that the previous administration had made Latin America “invisible.”
Regarding Ecuador’s general relationship with the U.S., Correa underscored on Assange’s program that it must be “a framework of mutual respect and sovereignty.” That wished-for mutual respect and especially Washington’s regard for Ecuadorian sovereignty are likely to be put to the test in the coming weeks.
Hillary Clinton may be having second thoughts about the energy she expended earlier this month on her first visit to Sweden as Secretary of State. If Assange succeeds in skirting Sweden and makes it to Ecuador, she may now have to put Quito back on her travel schedule.
A Clinton visit to Ecuador two years ago was marred by protests, but she found President Correa a gracious host. But that was before WikiLeaks disclosed Ambassador Hodges’s pejorative comments on Correa et al. and Correa decided to expel her from the country for “arrogance.”
Correa does seem to have developed an allergy to arrogance, so Clinton may wish to consider sending someone in her stead to try to persuade Ecuador to surrender Assange to the tender mercies of American “justice.”
20 Reasons Why America’s Next Bank Holiday Will Be a Nightmare
This article has been generously contributed for your reading pleasure by James Rawles of Survival Blog.
The world is on now on the brink of a global credit crisis that could be far worse than the tumultuous events of 2008. The ongoing sovereign debt crisis in the southern reaches of the Eurozone indicate that bank runs in the region will continue, and that more bank closure “holidays” will be declared. Under a bank holiday, virtually all deposits could be frozen and irredeemable for days, weeks, or even months. The key question is: Will this crisis spread to the rest of Europe and then even to the United States? I urge SurvivalBlog readers–particularly those in Europe–to be proactive, to stay “ahead of the power curve.” While the Generally Dumb Public (GDP) wakes up some morning to hear news of a bank holiday, you will have long hence prepared yourself.
Digits Lost in the Ether–Redeemable Mañana?
Most people don’t realize that printed U.S. currency and minted coins amount to less than $800 billion, worldwide. That is just a small portion of the aggregate Money Zero Maturity (MZM) money supply that now exceeds $7 Trillion. So what is in your bank account is just electronic money, and there is absolutely no way that even a fraction of depositors could get physical cash to redeem the digits in their accounts. If there is a bank holiday declared, there will undoubtedly be severe restrictions on cash withdrawals when banks re-open. Given the precedent of the limits on withdrawals of a few institutions during the Savings and Loan crisis of the 1980s and 1990s, I predict that withdrawal restrictions could go on for many months.
Here are 20 Reasons why America’s next bank holiday will be a nightmare:
A bank holiday will create a virtual blackout of information on not just checking and saving accounts, but also automated mortgage payments, CDs, and more. Our presently quite transparent banking system will suddenly become opaque. Your bank balance will become invisible. Your handy-dandy online banking web page will be replaced by a “Service Temporarily Unavailable” notice. The willingness to accept checks will evaporate in less than a day. The FUD factor (Fear, Uncertainty and Doubt) will be overwhelming.
Most businesses will no longer honor personal checks, corporate checks, or bank money orders. Showing a merchant your most recent bank statement isn’t likely to sway him. Again, the FUD factor will rule.
All checks in the U.S. are cleared through the automated clearinghouse (ACH)network. Most of this network is inside of banking system firewalls. Many Federal, State, and local tax payments are also handled through ACH. (A similar network exists for European banks–the Pan-European Automated Clearing House (PE-ACH), under the Single Euro Payments Area (SEPA) system).
Credit cards might not be accepted. The FUD factor will dictate that anything even peripherally related to the banking system will be suspect. (Even though the credit card companies have their own credit clearing mechanisms that are only attached to the banking milieu.)
Except for a few grandfathered recipients, Social Security payments are now made exclusively via bank direct deposit.
Military monthly pay, housing allowances, and ration payments are now made exclusively via bank direct deposit, in CONUS. That is true virtually across the board (Active component, Reserve, and National Guard.) Ditto for monthly military retirement payments.
Many State and Federal employees no longer get physical paychecks. They too, are trapped in the “direct deposit only” world.
Many Americans are now very dependent on bank debit cards (also known as a bank cards or check cards.) In fact, many people don’t even carry more than a few dollars in their wallets. If our world suddenly goes “cash only” most people will suddenly be out of cash.
ATMs, debit card transactions, and online banking can be shut down in minutes. This huge vulnerability of banking customers has already been evidenced by a few minor glitches.
Online payment systems like PayPal will be sharply degraded, because they rely on their ability to move funds to and from banks. More importantly, online payments are inextricably tied to credit card processing. If credit card processing is suspended, then online payments will be “dead in the water.”
Many regular monthly payments such as mortgages, insurance premiums, and some utilities are automatically debited from checking accounts. These will all come to a screeching halt.
SWIFT wire transfers will probably be suspended, freezing a good portion of global commerce. Similarly, International ACH transactions (IATs) will also be shut down, since they access the U.S. ACH network.
The ability to process credit card payments will be dubious, at best. Many merchants will wisely “just say no” to credit cards, even if their countertop POP terminals are still functioning and show available credit. And the fact that many credit cards are now just debit cards in disguise will only add to the reluctance of merchants to take any credit cards.
Point of purchase (POP) processing of credit and debit cards at gas stations has become ubiquitous. Nearly everyone now uses the “pay at the pump” option. Gas and diesel could become “cash only” transactions.
Most American families keep less than $300 in cash at home at any given time, including their kids’ piggy banks. For most families, that wouldn’t cover even one month’s rent.
Formerly distributed as “Food Stamps”, the USDA‘s Supplemental Nutrition Assistance Program (SNAP), provides benefits to low income families through Electronic Benefit Transfer (EBT) card payments. These cards look much like credit cards. And like checks, EBT payments are all routed through the ACH network. Again, this is a network that is inside banking system firewalls. If the banking system goes into holiday mode, then it may take days or even weeks to get EBT processing back on line. If the EBT payments stop, we can expect riots in metropolitan areas in less than a week.
Gift cards will be “iffy.” There are now two types of gift cards: “open loop” (or “network”) cards and traditional “closed loop” cards. Open loop cards are issued by banks or credit card companies and can be redeemed many places. It is likely that only closed loop cards will be honored by the issuing stores, because merchants will fear that open loop cards might have been zeroed out elsewhere. (If they can’t confirm the available balance, the card will be refused.)
Most Internet vendors are almost entirely dependent on credit card processing. If that processing system is disrupted, then mailorder firms will either have to cease operations, or have them slow to a snail’s pace, and be restricted to only non-bank money orders.
Reversion to U.S. Postal Service money orders (commonly called “PMOs“) will only be partially viable solution. This is because many small town and rural post offices don’t keep enough cash in their tills to be able to hand you $1,000 when you go to cash a PMO. You may be thinking, “Oh well, I’ll just ask them to write me a blank PMO, in exchange. Nope. A recent change to postal regulations designed to curtail money laundering banned money order-for-money order issuance. Bummer. And if you are considering using “Forever” postage stamps, hold your horses. Under a hygiene regulation published in the Domestic Mail Manual (DMM), postal clerks are not allowed to cash out (“buy back”) stamp booklets unless they are still in their sealed clear plastic master packages. So it might take decades to use up your Forever stamps, or you will be forced to liquidate them on the gray market at a slight loss.
Bank safe deposit boxes will probably be inaccessible. Plan accordingly.
Some Observations and Mitigation Steps:
Because so many pay and retirement benefit systems are now handled via bank direct deposit only, we could easily live through a frustrating “Roach Motel” period of several months when “Dollars check in, but they don’t check out.” Be prepared to ride through that period.
If the European credit spreads to the United States, then immediately visit your company’s payroll office, and ask to be removed from their direct deposit system. This change might take a couple weeks. With a paper paycheck, you can probably cash it elsewhere, even if you own bank closes its doors–perhaps even at your local grocery store.
Keep plenty of well-hidden cash at home. Since it won’t be earning interest, some of this cash might as well be in $2 rolls of nickels. That method will also give you a hedge on inflation, and also serve as insurance against a currency reform. (Where a zero could be lopped off the Dollar, overnight.)
Be prepared for times for when anything other than greenback cash or perhaps silver coins will be eyed with suspicion, or rejected outright. Even USPS PMOs and drug store money orders may be refused. In the era of bank holidays, cash will talk. Keep plenty of it on hand. Oh, and needless to say, don’t store your cash in a bank safe deposit box. You probably won’t have access to it during a bank holiday.
Be wise and circumspect in storing cash at home. Don’t tell anyone other than your spouse about that cash. See the SurvivalBlog archives for suggestions on building secret hiding places, like this one.
A good portion of your “stash of cash” should be in the form of $1 and $5 bills. This is because during a banking crisis, many people will not be able make change for small transactions. And if your local power, water, and phone companies refuse checks, then you will need to be able to pay them the exact amount of your monthly bill. (They probably won’t have much “change”, either.)
Apply for at least one gasoline station chain charge card. In turbulent times when they won’t take your check or your VISA card, they might still take their own chain card.
If you have to pay your utility bills in in cash or by PMO, do you know where their business offices are located? And consider the sort neighborhood where those offices are located. (Unless you live in a free state for open carry or Constitutional Carry, do you have your CCW permit, and plenty of pistol practice?) For safety, it might be wise to form a neighborhood posse to go pay those bills in a group of of six people once a month.
Your local supermarket may declare “cash only.” This is yet another reason why it it is vitally important for every family to have a comprehensive food storage program. By the same token, fuel storage also makes sense, if your local fire code allows it.
At the tail end of a banking crisis–when the bank doors do re-open–the Federal Reserve will certainly have to crank up the printing presses. Even people that never had “mattress money” will want some. All this new cash will increase the velocity of money, locally. This will be inflationary, even at the same time that a the macro level, we will witness a huge dollar deflation. (This is because the multiplier effectof every dollar on deposit will work in reverse, as withdrawals are made.) These will be strange times, indeed. If you start to see any evidence of mass inflation kicking in, then be ready to spend your dollars as quickly as possible to parlay them into practical, barterable tangibles. Don’t be the last one standing in the game of Dollar Musical Chairs.
Conclusion
The threats of credit crunches, bank runs, and bank holidays are not new. No society is immune from them. We’ve been fortunate here in the United States to have not suffered any limits on bank withdrawals since the Savings and Loan crisis of the 1980s and 1990s. But don’t expect this stability to be permanent. We live in a dynamic world with rapidly changing threats to our lives and livelihoods. Prepare for the worst and hope for the best.
The world is on now on the brink of a global credit crisis that could be far worse than the tumultuous events of 2008. The ongoing sovereign debt crisis in the southern reaches of the Eurozone indicate that bank runs in the region will continue, and that more bank closure “holidays” will be declared. Under a bank holiday, virtually all deposits could be frozen and irredeemable for days, weeks, or even months. The key question is: Will this crisis spread to the rest of Europe and then even to the United States? I urge SurvivalBlog readers–particularly those in Europe–to be proactive, to stay “ahead of the power curve.” While the Generally Dumb Public (GDP) wakes up some morning to hear news of a bank holiday, you will have long hence prepared yourself.
Digits Lost in the Ether–Redeemable Mañana?
Most people don’t realize that printed U.S. currency and minted coins amount to less than $800 billion, worldwide. That is just a small portion of the aggregate Money Zero Maturity (MZM) money supply that now exceeds $7 Trillion. So what is in your bank account is just electronic money, and there is absolutely no way that even a fraction of depositors could get physical cash to redeem the digits in their accounts. If there is a bank holiday declared, there will undoubtedly be severe restrictions on cash withdrawals when banks re-open. Given the precedent of the limits on withdrawals of a few institutions during the Savings and Loan crisis of the 1980s and 1990s, I predict that withdrawal restrictions could go on for many months.
Here are 20 Reasons why America’s next bank holiday will be a nightmare:
A bank holiday will create a virtual blackout of information on not just checking and saving accounts, but also automated mortgage payments, CDs, and more. Our presently quite transparent banking system will suddenly become opaque. Your bank balance will become invisible. Your handy-dandy online banking web page will be replaced by a “Service Temporarily Unavailable” notice. The willingness to accept checks will evaporate in less than a day. The FUD factor (Fear, Uncertainty and Doubt) will be overwhelming.
Most businesses will no longer honor personal checks, corporate checks, or bank money orders. Showing a merchant your most recent bank statement isn’t likely to sway him. Again, the FUD factor will rule.
All checks in the U.S. are cleared through the automated clearinghouse (ACH)network. Most of this network is inside of banking system firewalls. Many Federal, State, and local tax payments are also handled through ACH. (A similar network exists for European banks–the Pan-European Automated Clearing House (PE-ACH), under the Single Euro Payments Area (SEPA) system).
Credit cards might not be accepted. The FUD factor will dictate that anything even peripherally related to the banking system will be suspect. (Even though the credit card companies have their own credit clearing mechanisms that are only attached to the banking milieu.)
Except for a few grandfathered recipients, Social Security payments are now made exclusively via bank direct deposit.
Military monthly pay, housing allowances, and ration payments are now made exclusively via bank direct deposit, in CONUS. That is true virtually across the board (Active component, Reserve, and National Guard.) Ditto for monthly military retirement payments.
Many State and Federal employees no longer get physical paychecks. They too, are trapped in the “direct deposit only” world.
Many Americans are now very dependent on bank debit cards (also known as a bank cards or check cards.) In fact, many people don’t even carry more than a few dollars in their wallets. If our world suddenly goes “cash only” most people will suddenly be out of cash.
ATMs, debit card transactions, and online banking can be shut down in minutes. This huge vulnerability of banking customers has already been evidenced by a few minor glitches.
Online payment systems like PayPal will be sharply degraded, because they rely on their ability to move funds to and from banks. More importantly, online payments are inextricably tied to credit card processing. If credit card processing is suspended, then online payments will be “dead in the water.”
Many regular monthly payments such as mortgages, insurance premiums, and some utilities are automatically debited from checking accounts. These will all come to a screeching halt.
SWIFT wire transfers will probably be suspended, freezing a good portion of global commerce. Similarly, International ACH transactions (IATs) will also be shut down, since they access the U.S. ACH network.
The ability to process credit card payments will be dubious, at best. Many merchants will wisely “just say no” to credit cards, even if their countertop POP terminals are still functioning and show available credit. And the fact that many credit cards are now just debit cards in disguise will only add to the reluctance of merchants to take any credit cards.
Point of purchase (POP) processing of credit and debit cards at gas stations has become ubiquitous. Nearly everyone now uses the “pay at the pump” option. Gas and diesel could become “cash only” transactions.
Most American families keep less than $300 in cash at home at any given time, including their kids’ piggy banks. For most families, that wouldn’t cover even one month’s rent.
Formerly distributed as “Food Stamps”, the USDA‘s Supplemental Nutrition Assistance Program (SNAP), provides benefits to low income families through Electronic Benefit Transfer (EBT) card payments. These cards look much like credit cards. And like checks, EBT payments are all routed through the ACH network. Again, this is a network that is inside banking system firewalls. If the banking system goes into holiday mode, then it may take days or even weeks to get EBT processing back on line. If the EBT payments stop, we can expect riots in metropolitan areas in less than a week.
Gift cards will be “iffy.” There are now two types of gift cards: “open loop” (or “network”) cards and traditional “closed loop” cards. Open loop cards are issued by banks or credit card companies and can be redeemed many places. It is likely that only closed loop cards will be honored by the issuing stores, because merchants will fear that open loop cards might have been zeroed out elsewhere. (If they can’t confirm the available balance, the card will be refused.)
Most Internet vendors are almost entirely dependent on credit card processing. If that processing system is disrupted, then mailorder firms will either have to cease operations, or have them slow to a snail’s pace, and be restricted to only non-bank money orders.
Reversion to U.S. Postal Service money orders (commonly called “PMOs“) will only be partially viable solution. This is because many small town and rural post offices don’t keep enough cash in their tills to be able to hand you $1,000 when you go to cash a PMO. You may be thinking, “Oh well, I’ll just ask them to write me a blank PMO, in exchange. Nope. A recent change to postal regulations designed to curtail money laundering banned money order-for-money order issuance. Bummer. And if you are considering using “Forever” postage stamps, hold your horses. Under a hygiene regulation published in the Domestic Mail Manual (DMM), postal clerks are not allowed to cash out (“buy back”) stamp booklets unless they are still in their sealed clear plastic master packages. So it might take decades to use up your Forever stamps, or you will be forced to liquidate them on the gray market at a slight loss.
Bank safe deposit boxes will probably be inaccessible. Plan accordingly.
Some Observations and Mitigation Steps:
Because so many pay and retirement benefit systems are now handled via bank direct deposit only, we could easily live through a frustrating “Roach Motel” period of several months when “Dollars check in, but they don’t check out.” Be prepared to ride through that period.
If the European credit spreads to the United States, then immediately visit your company’s payroll office, and ask to be removed from their direct deposit system. This change might take a couple weeks. With a paper paycheck, you can probably cash it elsewhere, even if you own bank closes its doors–perhaps even at your local grocery store.
Keep plenty of well-hidden cash at home. Since it won’t be earning interest, some of this cash might as well be in $2 rolls of nickels. That method will also give you a hedge on inflation, and also serve as insurance against a currency reform. (Where a zero could be lopped off the Dollar, overnight.)
Be prepared for times for when anything other than greenback cash or perhaps silver coins will be eyed with suspicion, or rejected outright. Even USPS PMOs and drug store money orders may be refused. In the era of bank holidays, cash will talk. Keep plenty of it on hand. Oh, and needless to say, don’t store your cash in a bank safe deposit box. You probably won’t have access to it during a bank holiday.
Be wise and circumspect in storing cash at home. Don’t tell anyone other than your spouse about that cash. See the SurvivalBlog archives for suggestions on building secret hiding places, like this one.
A good portion of your “stash of cash” should be in the form of $1 and $5 bills. This is because during a banking crisis, many people will not be able make change for small transactions. And if your local power, water, and phone companies refuse checks, then you will need to be able to pay them the exact amount of your monthly bill. (They probably won’t have much “change”, either.)
Apply for at least one gasoline station chain charge card. In turbulent times when they won’t take your check or your VISA card, they might still take their own chain card.
If you have to pay your utility bills in in cash or by PMO, do you know where their business offices are located? And consider the sort neighborhood where those offices are located. (Unless you live in a free state for open carry or Constitutional Carry, do you have your CCW permit, and plenty of pistol practice?) For safety, it might be wise to form a neighborhood posse to go pay those bills in a group of of six people once a month.
Your local supermarket may declare “cash only.” This is yet another reason why it it is vitally important for every family to have a comprehensive food storage program. By the same token, fuel storage also makes sense, if your local fire code allows it.
At the tail end of a banking crisis–when the bank doors do re-open–the Federal Reserve will certainly have to crank up the printing presses. Even people that never had “mattress money” will want some. All this new cash will increase the velocity of money, locally. This will be inflationary, even at the same time that a the macro level, we will witness a huge dollar deflation. (This is because the multiplier effectof every dollar on deposit will work in reverse, as withdrawals are made.) These will be strange times, indeed. If you start to see any evidence of mass inflation kicking in, then be ready to spend your dollars as quickly as possible to parlay them into practical, barterable tangibles. Don’t be the last one standing in the game of Dollar Musical Chairs.
Conclusion
The threats of credit crunches, bank runs, and bank holidays are not new. No society is immune from them. We’ve been fortunate here in the United States to have not suffered any limits on bank withdrawals since the Savings and Loan crisis of the 1980s and 1990s. But don’t expect this stability to be permanent. We live in a dynamic world with rapidly changing threats to our lives and livelihoods. Prepare for the worst and hope for the best.
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