Thursday, May 14, 2009

Paint a sad face - another China product recall

What can you say about a face paint recalled by the FDA? That it made your child break out in a rash? That it caused his face to swell? That it was made in China? That it is contaminated by microbes?

What can you say? That it is out of stock! That's what  "Fun Express", the distributor for this product has to say. I searched their website for the words "recall", "FDA", and "China". All these searches came up empty. But when I searched for "face paint", I immediately came up with 159 hits.

The FDA alert lists among the products specifically recalled item #85/2080, "Orange Face Paint". Take a look at the screenshot from Fun Express above. It's the same exact item number!

The FDA "Enforcement Report" goes into more details, stating that the FDA analysis found " yeast/mold counts substantially above industry guidelines". Ewww! "Yeast and mold". Here kid, let me slobber some of this colorful yeast and mold all over your delicate face. And yet the reverse side of the package shown in this picture specifically states, "this water-based paint is made from FDA approved, high quality ingredients". Presumably that didn't include the yeast and mold. And in fact I'm pretty sure that the FDA never actually approved this manufacturing facility since it is in China. But that didn't stop this company from asserting its safety with an implied FDA seal of approval.

OK, I know this is not as big a story as the melamine tainted milk that killed hundreds of kids in China. Not even quite as big as the melamine tainted dog food that killed hundreds of dogs in the US. Not to mention the lead paint found in children's toys imported from China.

But something about children's face paint seems sacrosanct to me. Shouldn't a child be able to go to a birthday party and have her cute smiling little face painted without the fear of a dangerous infection? I'm pretty sure it's in the Bill of Rights. Wait I found it - here it is! Right in the preamble of the Declaration of Independence - the "unalienable Right" to the"the pursuit of Happiness". What could make a child happier than having her precious face painted with colorful butterflies and stars?

And just how bad does your quality control have to be anyway to get living "microbes" in a tube of paint? Didn't the lead contaminated chemicals used in the manufacturing process kill them? And what kind of "microbes" cause a beautiful kid's face to burn and itch making them run crying to their Mom for comfort? What are they manufacturing this stuff from anyway? Did they get the water from the sewer systems?

At the same time China is quick to quarantine any visitors suspected of having any contact with the H1N1 virus. Just ask the Mexican travellers that were held prisoner in unsanitary Chinese hotel rooms.

This is the Chinese Police State in action. On the one hand the corruption that allows hazardous and even deadly products to market just so the companies that manufacture those products can make a few extra bucks. And on the other hand the heavy hand of repression whenever govenment policies dictate that it is for "the good of the people".

And don't think that it can't happen here in the good ol' USA. Just remember those FEMA detention camps and the open ended purpose stated for their construction. The Chinese example demonstrates that a medical "emergency" is just as good an excuse as a terrorist "emergency" for declaring martial law - even if it is on a "limited basis".

It may seem that I am stretching the importance of this relatively insignificant recall. But as a consequence of China being accepted in the WTO in 2001, China's economy and the US economy were effectively fused into one. And along with the economic entwinement comes political entanglements as well. Under the rules of the WTO, the US is not allowed to erect economic barriers to protect American industries. Think about this for a second. The consequence is that the US Congress has given up sovereignty to a foreign power.

And what do we get in return - besides microbe infested face paint? This puts American workers in direct competition with Chinese workers. And rather than having the effect of raising the wages of Chinese workers, the main effect is to lower the standard of living for Americans. That is if American workers can even find a job to begin with.

The business interests in the US have been waging a steady campaign against the American worker ever since the Reagan years. Sadly, Reagan was assisted by many working class Americans. It was the old divide and conquer strategy. Reagan turned the less fortunate non-union workers against the more fortunate union workers. Having successfully busted the unions, it is now the turn of the non-union workers to feel the wrath of the financial oligarchs.

The threat of exporting American jobs to low wage countries like China is the stick that the oligarchs use to beat American workers into submission. And the economic "crisis" just heightens the sense of fear and despair felt by the hapless worker.

Sadly, most Americans are woefuly unaware that their fate is being determined by the blood sucking parasites that control the reins of power in Washington. They have been led to believe that the economic "crisis" is a no more than an unfortunate accident.

This "crisis" is not an accident. The American people must intervene forcefully and stop arguing among themselve over who among them is working harder and therefore more deserving. At the same time we are arguing over the crumbs, our financial overlords are feasting. Rather than complain about the wages earned by union workers, focus your attention on the millions being handed out in bonuses to the fatcat executives.

The answer is not for the FDA to open an office in China as has already happened. The answer is for the US to become more self sufficient. That has been the answer that everyone agrees upon in terms of reliance on foreign sources of energy, and that should also be the response to reliance on foreign manufacturing. Those that call this response "protectionist" merely expose their own agenda. Money indeed recognizes no boundaries.

The multi-national companies that control the world economy are just as happy getting their profits through China as through the US. In fact their profits are maximized in low wage countries, so it should be no surprise that they are conspiring to transport their wealth from the US to China. This is what the economic "crisis" is all about. A huge transfer of wealth, never seen before in history.

Related posts

Monday, May 11, 2009

How Goldman Sachs whacked Bear Stearns

There's a new book that's coming out tomorrow on the fall of Bear Stearns. It's called "Street Fighters: The Last 72 Hours of Bear Stearns, the Toughest Firm on Wall Street" and the author is WSJ reporter Kate Kelly.

Ms. Kelly picks up the story when BS is already in the emergency room with a fatal wound. But what she missed is the hit man's bullet that put BS in critical condition. A previous story by Roddy Boyd of Fortune Magazine gives us an insider's view of that hit. And the perp is a familiar face to FNT (Future News Today) readers.

[...cue up Godfather music. Dim theatre lights...]

The hit took place on March 11. That morning a memo was sent out by Goldman Sachs: Bear Stearns is a dead man.
That morning Goldman Sachs's credit derivatives group sent its hedge fund clients an e-mail announcing another blow [...] on March 11, Goldman told clients it would no longer step in for them on Bear derivatives deals.
"Goldman told Wall Street that they were done with Bear, that there was [effectively] too much risk. That was the end for them." 
Bear Stearns was whacked by Goldman Sachs. Just a few days later BS would succumb to the fatal blow. Then Godfather Paulson stepped in to mop up the mess. And get this - he warned his fellow traders from taking advantage of the situation.
In Washington, Treasury Secretary Hank Paulson was just beginning a conference call with industry executives. [...] He didn't want rapacious trading tactics to further wound a gravely injured Bear, so he decided to put it to the firms straight: I expect you to behave yourselves.
"I want you to deal with Bear Stearns as a responsible counterparty," he [Paulson] told the group.
That's right. According to WSJ reporter Kate Kelly, Paulson was telling his rival gangs on Wall St. to [...cue up West Side Story music...] "just play it coool boys, real coool". That's after Goldman Sachs, Paulson's former company had already stuck the knife in Bear Stearn's back. And now he wants everbody to play nice?

So how much you want to bet that as a condition of the deal where the Fed bought up Bear's bad asset, Goldman was payed back whatever Bear owed at one hundred cent on the dollar? Because that was what happened in the deal that the Fed made with AIG. Is anybody ever going to investigate Paulson, or is he going to be allowed to get away with [corporate] murder?

And in case you're starting to feel sorry for the Bear Stearns gang, here's a quote from their former CEO Jimmy Cayne that should let you know what kind of people we are dealing with here.
Tim Geithner [is] a "prick" who "thinks he's got a big dick ... He’s got nothing, except maybe a boyfriend."
I guess I should have put an R rating on the top of this posting. I usually try to keep my blog PG, but this quote is from the New York Magazine. And hey, if they can get away with it then why not me? That quote, by the way, comes to us from another book on the demise of Bear Stearns titled "House of Cards: A Tale of Hubris and Wretched Excess on Wall Street" by William D. Cohan.

As a side note, there's a mutual animosity between authors Kelly and Cohan stemming from another Jimmy Cayne quote in the Cohan book.
In the book, according to the Observer, Cayne calls Kelly "a cunt ... whose capability is zero." Now Kate is mad because the writer, William Cohan, didn't call her and get her reaction to the slur. [...] “What was I going to say, ‘Hey, Kate, I don’t know you and you don’t know me, but Jimmy has called you this name, Do you have a reaction to that?" Cohan told the paper in his defense.
And whatever happened to Alan Schwartz? He's the guy that tookover as BS CEO just months before the final collapse. Well according to news reports, he's got a new gig on Wall Street.
Alan Schwartz, who took the role as chief executive of Bear Stearns just two months before the 85-year-old firm collapsed in January 2008, may be headed to Goldman Sachs Group Inc (GS.N: Quote, Profile, Research), Fortune magazine said on Monday.

Citing a source familiar with the negotiations going on between Goldman and Schwartz, Fortune said the chances are about "50-50" that Schwartz will soon be a partner-level managing director at Goldman.
"Hey Schwartz, you did such a good job at handling the boss's business at Bear Stearns that the boss decided to make you an offer you can't refuse at Goldman Sachs. Just a small token of our appreciationfor keeping your mouth shut. Capiche?"

[...cue up Godfather music. Roll titles. Fade to black. Turn up theatre lights...]

I wonder what will happen in the sequel? Go grab some popcorn folks, but don't go away. Today you're in for a treat because we've got a double feature!

----- intermission -----

I hope you all took advantage of the time off to take a bathroom break. Are you ready for more?

OK, I did a bit more Googling on WSJ reporter Kate Kelly. You know that WSJ story about Stephen Friedman and how he was serving on the board of Goldman Sachs at the same time he was NY Fed Chairman in an apparent conflict of interest? Kelly wrote that, and as a result Friedman resigned from the NY Fed. Chalk one up for Kate.

And this is not the first time that Kelly has written about Bear Stearns. She covered the story in a series of articles in the Wall Street Journal last year. Here's one from July 2008 that has an interesting title, "Goldman Is Queried About Bear's Fall". And the subtitle only adds to the suspense, "Manipulation Talk Worried Schwartz; Lehman Also Calls".
Now, the big securities firm has come under suspicion, at least from the chiefs of two rivals who have questioned in recent months whether Goldman, even indirectly, might have put pressure on their firms' stocks.
OK, that's the same Schwartz that now appears to be inline to get a job at Goldman. I imagine he's not asking so many questions now. But look if there's one thing you should have figured out by now, it's that Wall St. is one big rumor mill. They're worse than a bunch of old church ladies.

What we need is an investigation by a government agency that has the power to punish the evil wrongdoers. And flying in to the rescue comes... daaaa-da-da-DAAA... the SEC! OK, I heard that snickering in the back of the theatre. No, really.
The Securities and Exchange Commission, which is investigating whether insider trading or market manipulation occurred in Bear Stearns's stock, options, or other securities, is examining trading documents showing that in the weeks prior to the firm's collapse, a number of parties curbed their exposures to the troubled firm, according to people familiar with the matter.

Cutting exposure to Bear Stearns and other financials was a compelling strategy at the time, and many parties may have done so legitimately. But making such moves in hopes of creating broader market anxieties is considered improper trading.
"Improper trading"? The whole world economy collapsed because of the fall of Bear Stearns and Lehman Brothers and the WSJ and SEC are talking about "improper trading"? That makes it sound like they just exhibited bad manners, like burping at the dinner table. And isn't the SEC the same government organization that couldn't figure out that Madoff was operating some kind of swindle when he hadn't made any trades...ever? It seems like someone should be investigating the SEC! And it's not as if the WSJ uncovered the Madoff story, so they shouldn't be feeling to smug either. Congress? Ditto!

It's been over a year since the fall of BS and still no prosecutions with regards to Goldman Sachs trading - not even a fine! No, instead it seems that GS has been rewarded for its criminal activity. Just take a look at who were the principal counterparties of Bear Stearns.
The documents indicate that in the weeks before March 16, when Bear Stearns reached its initial agreement to sell itself to J.P. Morgan, Goldman Sachs International, which encompasses the firm's European trading units, was one of the most-active parties in trading securities known as credit default swaps that it had bought from or sold to Bear Stearns -- more than most other Bear trading partners. 
Q: Who was one of the biggest beneficiaries when the Fed bought up AIG's bad assets?
A: Goldman Sachs.
Q: So when the Fed buys up Bear's bad assets, who do you think is the chief beneficiary?
A: Goldman Sachs.
Q: And who was the Chairman of the New York Fed at the time?
A: Gold Sachman's director Stephen Friedman, who was forced to resign due to "conflicts of interest".
Q: And who was the President of the New Yord Fed at the time?
A: Tim Geithner, who is now the Treasury Secretary.
Q: And who was Treasury Secretary at the time?
A: "Hank" Paulson, who was the former CEO of Goldman Sachs.

The problem seems to be that any serious investigation would lead back to Paulson and Geithner, or did I miss something?

I would suggest that the investigators at the SEC read FNT (Future News Today) and pay particular attention to my article on naked short selling titled "The Phantoms of the Stock Market".  They might just learn a thing or two about how stocks are manipulated. The basic recipe seems to be:
  • A cup of naked short selling.
  • Add liberal amounts of Credit Default Swaps to taste.
  • A dash of malicious rumors.
  • Stir until it achieves a creamy texture. Test that the peaks just collapse.
  • Bake in Hell's kitchen until well done.
  • Serve to gullible unsophisticated investors, without letting them know the list of ingredients.
I could go on and on and on, but all this talk of food is making me hungry. I think I'll go cash in my KFC coupons. Say what? Et tu, Oprah?

Thursday, May 7, 2009

Ashton Lundeby - victim of the Terrorist State

[Update: Wired article by ex-con hacker Kevin Poulsen claims that "Teenage Bomb Threat Suspect Was Internet Prank-Call Star ".  According to Poulsen, Ashton Lundeby used an alter online ego named "Tyrone" to make lewd and racist prank calls and even bomb threats. This still does not destroy my argument that the government went to far in using Police State tactics against a prankster. Luckily I did not jump to conclusions in my article. Also, it is yet to be proven in court that Poulsen's allegations are true, although it is increasingly likely that they are. Still, I wonder about the accuracy of some of the quotes that Poulsen attributes to Ashton's mother in his article.]


I have to admit that I'm struggling with trying to write an article about the case of Ashton Lundeby. I like to stick to verifiable facts when writing a piece, but in this case there are very few facts that are available. But if this case only serves to remind us of the dangers of the Patriot Act, then it is well worth exploring.

Here's what we know so far about this case

Ashton Lundeby is 16 years old. He is home schooled by his mother, Annette Lundeby. He's never been in trouble with the police before.

On March 5, 2009 Ashton was arrested at his home in Oxford, North Carolina. The arrest was carried out by FBI officials accompanied by North Carolina State Police. According to accounts by Mrs. Lundeby the State Police were from the state terrorism task force.

The charges against Ashton seem to be that he placed a bomb threat against Purdue University on February 15. I say "seem to be" because it is not quite clear what the exact charges are. He may be charged with placing bomb threats against other universities as well.

Ashton is currently imprisoned in a detention center for juveniles in South Bend, Indiana. Some have reported that he is in a federal detention center, but the only juvenile detention center I have been able to locate in South Bend is run by the Indiana State Government.

No evidence of any bomb making material was turned up at the Lundeby home. There is no suggestion that Ashton ever made a bomb or actually planned to make a bomb. The only charge that has been made public is that of a bomb threat.

Ashton Lundeby and the Patriot Act

What's not so clear is whether Ashton was arrested under the Patriot Act. Some say he was, and others say he wasn't. His mother has gone on record saying that the Patriot Act is somehow involved in his arrest. The government has had no comment on the case.

I'm one of those that believes that Ashton was arrested under the Patriot Act. I wish I could be more definitive about this, but I'm not a lawyer. Neither are most of the other people commenting on this case. Clearly Mrs. Lundeby needs a competent lawyer that can argue this case forcefully and clear up the issues with regard to the Patriot Act.

Here is what one person who is a lawyer, Scott Horton, has to say about this case.

How did this happen? It’s called the USA Patriot Act, and it grants law enforcement authorities police-state powers whenever they think national security is affected. In many cases, they no longer have to justify themselves to courts and secure warrants, and when they do need warrants, the process is steamrollered. Ms. Lundeby says they used the USA Patriot Act to “suspend her son’s due process rights.” That’s exactly right. All they have to do is call him a terrorist. And no matter how absurd that claim is (as is the case with a 16-year-old who can prove he was at a church function at the time an alleged bomb threat was made), the National Surveillance State’s police powers are essentially beyond question. Maybe it’s time to repeal the Patriot Act.
I'm not sure how Mr. Horton came to these definitive conclusions. I will say this. The Patriot Act defines a "domestic terrorist". Once a person is declared a "terrorist", domestic or international, the Patriot Act kicks in. The PA can be used by law enforcement officials to "streamline" the arrest and conviction of said "terrorist". Essentially the PA is designed to strip an accused "terrorist" of his civil liberties. This applies even to US citizens. In fact a person can be stripped of their citizenship once they have been accused of being a "terrorist".

In the case of Ashton, presumably the bomb threat was deemed to be an act of terrorism. That makes Ashton a "terrorist". As Mr. Horton points out this is stretching the definition to the point of absurdity. Before 9/11 and the Patriot Act there were kids making bomb threat hoaxes. Such kids got detention. They weren't arrested by the FBI.

Yes, there have been cases where teenagers shot other students in school. That is certainly a very serious matter. But again, there is no evidence that Ashton had at his disposal any kind of weapon or bomb making material.

Is Ashton guilty or innocent?

His mother asserts that he is innocent and that he was the victim of a setup by some hackers that made it appear that he phoned in the bomb threat to Purdue. This is probably the area where there is the least amount of verifiable information.

Common sense says to me that a kid living in North Carolina is not going to call in a bomb threat to Purdue which is in Indiana. Why? Because if it's intended to be a prank, then where's the fun in that? You don't get to see the building empty out or talk to some of the kids affected. Still it's possible that he could get his jollies from just the reaction of the person on the other end of the line.

So let's just assume that he did do it. And that he called other universities as well with bomb threats. Does that make him a "terrorist"? Not under my definition. That just makes him a prankster. Terrorist... prankster - big difference! Both acts are illegal, but one involves a real threat to human life.

The Terrorist State

Which is the bigger act of terrorism - a kid making a bomb threat, or police bursting into someone's house? There is a point where the police while pretending to protect us from terrorists become the terrorists themselves. This is the point where we cross over into a Police State. Under the Patriot Act suspected "terrorists" can literally and legally be disappeared. The PA is inherently unconstitutional because it strips citizens of their civil liberties.

More information on the Ashton Lundeby case

Here are some links I found online.
  • The original WRAL report by Amanda Lamb. Here is the video and here is the accompanying article. This is the definitive report that broke the story.
  • Article on Pro Libertate blog by William N. Grigg titled "Free Ashton Lundeby!". Mrs. Lundeby was interviewed for this story. It is the best account online of the story after the WRAL report.
  • Story on Wired by ex-convict and hacker, Kevin Poulsen, who insists that the Patriot Act has nothing to do with the story of Ashton Lundeby titled "Bloggers, TV, Go Nuts Over Misleading ‘Patriot Act’ Arrest Claim". I have no idea why this non-lawyer thinks he has any authority to talk about the legal aspects of this case. It could just be a case of trying to stretch his 15 minutes of fame at the expense of a 16 year old kid.
  • Interview of Mrs. Lundeby by Alex Jones. I don't think that Alex did a particularly good job of interviewing Mrs. Lundeby, but at least he was the first to air this story nationally.
  • Interview of Mrs. Lundeby by Ron Reagan on Air America. Again, not a great interview. Mrs. Lundeby needs to get a lawyer that can explain her son's case to the public better.
  • Scott Horton has a short article on the Harper's Magazine website that I cited above. He gets right to the point with regards to the Patriot Act although he doesn't have any new information about the case.
While the MSM has been completely ignoring this story, the blogosphere has taken up the case. It has been gaining momentum over the past few days.



This just appeared online. William Grigg has published this statement.
It appears that, contrary to what I reported two days ago, Ashton Lundeby is not being held under the USA PATRIOT act.

Earlier today, a memo marked "Not for distribution outside law enforcement" was circulated among officials in Indiana -- where Ashton is being held at the Thomas N. Frederick Juvenile Justice Center in South Bend. The memo complained of hostile publicity given to the case inspired by what were described as "false claims" from Ashton's mother, Annette Lundeby, about the use of the PATRIOT act in the arrest and detention of her son.

Those claims led the office of US Attorney David Capp to issue a press release today insisting that the arrest and detention of Ashton Lundeby "is unrelated to the PATRIOT act."

"The juvenile has appeared in court on three occasions, once in North Carolina for an initial hearing and a detention hearing, and twice in Indiana for a continued initial hearing and a status hearing," the press release relates. "At each hearing, the juvenile was represented by counsel.... The juvenile is presently housed in a juvenile facility in the Northern District of Indiana where he does not have contact with adult offenders. His mother has been apprised of each court appearance and has attended the hearing in North Carolina; she did not appear at either of the hearings in Indiana."
Mr. Grigg has been updating the story on his blog at :


As I said in my introduction, whether or not this case is directly related to the Patriot Act is somewhat irrelevant. It still represents an example of the Police State tactics used by law enforcement. For me this is a reminder that the Patriot Act is still in effect under the Obama administration. The fact that this case can be prosecuted without the PA is indeed more proof that the PA is not needed for law enforcement to do its job.

As for justice in the United States of America, let me remind you that Bernie Madoff who stole billions of dollars was allowed to stay in his luxury penthouse while awaiting trial. In contrast, Ashton Lundeby was incarcerated hundreds of miles from his home and his mother. I wonder how this case would have proceeded if Ashton were the son of Hank Paulson for example.

And as far as I'm concerned, if there is anyone that should be arrested for false threats against America, it is Hank Paulson. But in the American legal system he is "too big to jail". In America we have "the best legal system money can buy".

Everyone thinks that "it can't happen to me". That is until they actually have an experience with the police and the legal system. That is when they realize that the system is not setup to protect the common person. For me, this is part of the story of the Lundeby's. Hopefully, Ashton and his mother will remember this when they read about how law enforcement treats those even less fortunate than themselves. Hopefully, this event in their lives will act to permanently awaken them to the dangers of a Police State and the perils of remaining silent.