Daily Archive: 12/15/2011

Dec 15 2011

A House of Cards Behind a Jet Engine

Germany’s Hidden Risk

By Peter Coy, BusinessWeek

December 14, 2011, 11:00 PM EST

Germany’s Bundesbank-BuBa for short-has quietly, automatically lent €495 billion to the European Central Bank via Target2. That lending has balanced correspondingly huge borrowings from Target2 by the central banks of weaker nations including Greece, Ireland, and Portugal-and lately Spain, Italy, and even France. They are technically “claims,” not loans. To find them you have to root around in the footnotes of the reports of the 17 national central banks of the euro zone.

If the euro zone breaks into sorry little pieces, Germany could possibly lose its entire €495 billion claim. That’s more than $650 billion. It is 60 percent bigger than Germany’s annual federal budget-and larger than the lending under the European Financial Stability Facility and other aid programs that have received more scrutiny.



Germany’s Bundesbank-BuBa for short-has quietly, automatically lent €495 billion to the European Central Bank via Target2. That lending has balanced correspondingly huge borrowings from Target2 by the central banks of weaker nations including Greece, Ireland, and Portugal-and lately Spain, Italy, and even France. They are technically “claims,” not loans. To find them you have to root around in the footnotes of the reports of the 17 national central banks of the euro zone.

If the euro zone breaks into sorry little pieces, Germany could possibly lose its entire €495 billion claim. That’s more than $650 billion. It is 60 percent bigger than Germany’s annual federal budget-and larger than the lending under the European Financial Stability Facility and other aid programs that have received more scrutiny.



Here’s how it happened. When a Greek businessperson buys a truck from Germany with money from a checking account, the transaction is carried out between the two nations’ central banks via Target2. The truck seller isn’t interested in financing the purchase-it wants euros now. So the Bundesbank has to come up with money in order to deposit it in the seller’s checking account. In accounting terms, the Bundesbank acquires a liability (what it owes to the truck seller’s checking account) and an asset (a claim on the ECB).

The transformation of the Bundesbank’s balance sheet through this slow-but-steady process has been stunning-and to hard-money Germans, sickening. At the end of 2006, Target claims represented just 7 percent of the Bundesbank’s assets. By this October they represented 64 percent, according to data compiled by economists Aaron Tornell of the University of California-Los Angeles and Frank Westermann of Germany’s University of Osnabrück. The collateral the ECB holds to back those loans is primarily the sovereign debt of the euro zone’s weakest nations. It’s a far cry from the gold that’s the Bundesbank’s second-biggest asset (17 percent).



As Europe’s financial crisis has worsened, the ECB has benevolently turned a blind eye to the poor quality of collateral posted by the Bank of Greece and others. But a reckoning is due. In an interview with Bloomberg News on Dec. 13, Bundesbank President Jens Weidmann expressed more concern about the collateral than the volume of ECB balances. “In a situation like the current one, where we are providing solvent banks with liquidity,” he said, “for me the size of the Target2 balances is less important than the risks we are taking on. It is my concern that we limit these risks as much as possible.”



Germany faces a dilemma familiar to anyone who has ever made a bad loan-whether to keep throwing good money after bad to keep the debtor afloat or pull the plug and suffer the consequences. The half-trillion-euro claim the Bundesbank has on the ECB is an important but poorly understood factor in the decisions over the future of the euro.

European Banks Get ‘False Deleveraging’ in Seller-Financed Deals

By Anne-Sylvaine Chassany, Simon Packard and Neil Callanan, Bloomberg News

Nov 22, 2011 7:01 PM ET

Because most buyers of distressed assets fund purchases with debt, which has become increasingly expensive and difficult to obtain, banks are financing transactions themselves, even if it means retaining loans on their balance sheets. That will slow deleveraging and make more asset sales necessary, analysts say.

“A lot of those asset sales might be dependent on the banks themselves, the sellers, providing financing to the buyers,” Raoul Leonard, a London-based RBS analyst covering southern European banks, said on a conference call with clients Oct. 20, without referring to any specific deal. “It’ll be almost false deleveraging going on, but it’s off your book and you can argue that the risk-weighting changes.”



European banks will dispose of less than 100 billion euros of the more than 500 billion euros of distressed loans and other impaired assets because they can’t afford to take losses on the sales, Huw van Steenis, a Morgan Stanley analyst in London, wrote in a Nov. 13 note. Banks may have to unload some of their good assets to U.S. or Asian competitors, he said. Van Steenis estimated banks in Europe may shrink assets by between 1.5 trillion euros and 2.5 trillion euros in two years.

The IMF-ECB ‘Plan’ – Fig-Leaf Upon Fig-Leaf

Authors: Warren Mosler & Philip Pilkington, EconoMonitor

November 29th, 2011

The latest Euro fashion is for the IMF to fund distressed sovereigns while being, in turn, funded by the ECB – while all this includes the fashiony gimmick that the IMF guarantees the loans.

The end result, of course, is that the ECB writes the check – which is precisely what it takes to make any of these schemes work. In fact, whenever you hear of any of these wacky evasions… er… sensible proposals, you can be safe in the knowledge that it will always work as long as it is the ECB writing the check. But we digress; and so here is how this latest one scheme will function.

When the ECB buys European national government bonds it credits member bank accounts on the ECB’s spreadsheet. Those accounts count as ‘money’ while the bonds did not count as ‘money’ and so, this action is said to be ‘printing money’ – and printing money is bad for some reason or other according to our German friends… and so the ECB undertakes a further step: sterilisation.

The ECB offers different euro accounts – which are also just numbers on an ECB spreadsheet – with relatively short maturities that pay interest. This is called ‘sterilisation’ because these deposits don’t technically count as money. Cool, huh?



When the ECB buys Special Drawing Rights from the IMF it credits an IMF account with the required euros. This does not count as ‘printing money’. And when the IMF loans those funds on to Italy or whoever, it does not count as ‘printing money’ either even though, when all is said and done, the same euros sit in the same ECB accounts and they effectively come from the same place. How clever.

ECB puts emergency plans in place as German banks feel the heat

Heather Stewart, Jill Treanor and Patrick Collinson, The Guardian

Thursday 8 December 2011 15.33 EST

Following European-wide “stress tests”, Germany’s banks were found to need more than double the amount of capital anticipated, with the focus immediately turning on Commerzbank, in which the German state already owns a 25% stake, and amid speculation the government may need to step in with a fresh capital injection.



When the initial results of stress tests intended to protect banks against the eurozone crisis were announced in October the European Banking Authority announced that €106bn (£90bn) of extra capital would be needed to shore up banks against the eurozone crisis and restore confidence in the battered sector. But that shortfall was revised up to €115bn and the gap for Germany’s banks raised to €13.1bn from €5.2bn. Commerzbank alone needs €5.3bn of the total for Germany, up from €3bn, Deutsche Bank needs €3.2bn, while the amounts needed by Spanish banks remain unchanged at €26.2bn – with Santander needing to find €15bn of the total. Commerzbank is confident it can find the extra capital by its own means.



Those banks with shortfalls have been given until 20 January to present their proposals to their regulators and must find ways to fill gaps without leading to a “reduced flow of lending to the EU’s real economy”. The EBA reiterated that they should reduce bonuses and retain their profits to bolster their capital before attempting assets sales. Efforts already announced by French banks reduced their shortfall by €1.5bn to €7.3bn.

Europe Still Heading For Collapse

Author: Tim Duy, EconoMonitor

December 15th, 2011

The half-life of the effectiveness of European summits is growing increasingly shorter.  While I have been a long-term Europessimist, market participants are more willing to trade on whatever appears to be positive news, thus markets jump whenever it appears the Europeans are taking action.  But eventually the game will wear thin as market participants increasingly realize European “solutions” are never more than half-measures intended to kick the can down the road another few months.

And the last summit was no exception.  The reality is quickly sinking in that, relative to the dimensions of the challenge, very little was really accomplished two weeks ago.  And very little will be accomplished until European leaders come to the realization that they continue to treat the symptoms of the disease, not the cause of the disease.  They need to find a mechanism to address Europe’s internal imbalances that does not rely exclusively on deflation as a cure.



Arguably, European policymakers might see the fundamental problem, but also recognize a real solution in years away.



Europe doesn’t have years.  The vice of austerity packages will eventually crush to hard, and the cost of staying within the Euro will exceed the costs of exit.

Meanwhile, the ECB is at best having mixed results.  On one hand, recent actions appear to have stabilized government debt markets in Spain, Belgium, and France.  On the other, Italian yields have retraced much of their collapse.  Probably more importantly, however, stabilization of the banking crisis remains elusive.



Germany needs to issue a massive amount of debt to support demand in Europe, even at the cost of higher relative inflation.  And, better yet, to support debt writedowns in the periphery.  The response from Germany:  Nein.

Bottom Line:  I still don’t see where this ends well.  Play the news cycle if you are so inclined, but keep one eye on the key issue.  Is Europe working to resolve their fundamental internal imbalances with anything other than deflation?  As long as the answer continues to be “no,” be afraid.  Be very afraid.

Dec 15 2011

Punting the Pundits

“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.

Thanks to ek hornbeck, click on the link and you can access all the past “Punting the Pundits”.

Glenn Greenwald: Bradley Manning deserves a medal

The prosecution of the whistleblower and alleged WikiLeaks source Bradley Manning is an exercise in intimidation, not justice

After 17 months of pre-trial imprisonment, Bradley Manning, the 23-year-old US army private and accused WikiLeaks source, is finally going to see the inside of a courtroom. This Friday, on an army base in Maryland, the preliminary stage of his military trial will start.

He is accused of leaking to the whistleblowing site hundreds of thousands of diplomatic cables, war reports, and the now infamous 2007 video showing a US Apache helicopter in Baghdad gunning down civilians and a Reuters journalist. Though it is Manning who is nominally on trial, these proceedings reveal the US government’s fixation with extreme secrecy, covering up its own crimes, and intimidating future whistleblowers. [..]

Despite pledging to usher in “the most transparent administration in history”, President Obama has been obsessed with prosecuting whistleblowers; his justice department has prosecuted more of them for “espionage” than all prior administrations combined.

The oppressive treatment of Manning is designed to create a climate of fear, to send a signal to those who in the future discover serious wrongdoing committed in secret by the US: if you’re thinking about exposing what you’ve learned, look at what we did to Manning and think twice. The real crimes exposed by this episode are those committed by the prosecuting parties, not the accused. For what he is alleged to have given the world, Manning deserves gratitude and a medal, not a life in prison.

Robert Sheer: There Goes the Republic

Once again the gods of war have united our Congress like nothing else. Unable to agree on the minimal spending necessary to save our economy, schools, medical system or infrastructure, the cowards who mislead us have retreated to the irrationalities of what George Washington in his farewell address condemned as “pretended patriotism.”

The defense authorization bill that Congress passed and President Obama had threatened to veto will soon become law, a fact that should be met with public outrage. Human Rights Watch President Kenneth Roth, responding to Obama’s craven collapse on the bill’s most controversial provision, said, “By signing this defense spending bill, President Obama will go down in history as the president who enshrined indefinite detention without trial in US law.” On Wednesday, White House Press Secretary Jay Carney claimed “the most recent changes give the president additional discretion in determining how the law will be implemented, consistent with our values and the rule of law, which are at the heart of our country’s strength.”

What rubbish, coming from a president who taught constitutional law. The point is not to hock our civil liberty to the discretion of the president, but rather to guarantee our freedoms even if a Dick Cheney or Newt Gingrich should attain the highest office.

(emphasis mine)

New York Times Editorial: Holder Speaks Up for Voting Rights

For months, the Justice Department has largely been silent as Republican-dominated legislatures in state after state made it harder for minorities, poor people and other Democratic-leaning groups to vote. On Tuesday, however, Attorney General Eric Holder Jr. spoke out forcefully and promised to use the full weight of his department to ensure that new electoral laws are not discriminatory. To live up to that vow, he will have his hands full.

Republican lawmakers in more than a dozen states have recently enacted laws designed to limit Americans’ access to the polls, often concentrating on voters – blacks, Hispanics, students and the poor – who showed up in large numbers in 2008 to elect Barack Obama. They have imposed strict voter-ID requirements, knowing that millions of people cannot easily meet them; eliminated early voting periods; and restricted registration drives. (Voter ID laws have been introduced in at least 34 states.)

What the hell took Holder so long?

John R. McArthur: President Obama Richly Deserves to Be Dumped

As evidence of a failed Obama presidency accumulates, criticism of his administration is mounting from liberal Democrats who have too much moral authority to be ignored.

Most prominent among these critics is veteran journalist Bill Moyers, whose October address to a Public Citizen gathering puts the lie to our barely Democratic president’s populist pantomime, acted out last week in a Kansas speech decrying the plight of “innocent, hardworking Americans.” In his talk, Moyers quoted an authentic Kansas populist, Mary Eizabeth Lease, who in 1890 declared, “Wall Street owns the country.. . .Money rules.. . .The [political] parties lie to us and the political speakers mislead us.”

A former aide to Lyndon Johnson who knows politics from the inside, Moyers then delivered the coup de grace: “[Lease] should see us now. John Boehner calls on the bankers, holds out his cup, and offers them total obeisance from the House majority if only they fill it. Barack Obama criticizes bankers as fat cats, then invites them to dine at a pricey New York restaurant where the tasting menu runs to $195 a person.”

Paul Krugman: In the US, Decidedly Warped Standards for “Mission Accomplished”

Matt Yglesias and Kevin Drum say the right thing about revelations that big banks got very easy terms during the 2008 financial crisis: the real scandal isn’t so much that those banks got rescued as that the rest of the population didn’t. [..]

What’s unforgivable is the way policy makers, both at the Fed and elsewhere, basically declared Mission Accomplished as soon as the panic in financial markets subsided and stocks were up again. When spring rolls around, we’ll reach the third anniversary of a declaration from Ben Bernanke, chairman of the Fed, that “green shoots” were making an appearance – and there will still be 4 million Americans who have been out of work for more than a year. Yet there has been no sense of urgency about dealing with unemployment; indeed, most of the elites’ conversation has been about stuff like cutting Social Security payments a decade or two from now.

As Mr. Drum says, that’s the true radicalizing experience.

Robert Reich: Newt’s Tax Plan, and Why His Polls Rise the More Outrageous He Becomes

Newt Gingrich has done it again. With his new tax plan he has raised the bar from irresponsibility to recklessness.

Every dollar estimate I’m about to share with you comes from the independent, non-partisan Tax Policy Center – a group whose estimates are used by almost everyone in Washington regardless of political persuasion.

First off, Newt’s plan increases the federal budget deficit by about $850 billion – in a single year!

To put this in perspective, most forecasts of the budget deficit cover ten years.  The elusive goal of the White House and many on both sides of the aisle in Congress is to reduce that ten-year deficit by 3 to 4 trillion dollars.

Newt goes in the other direction, with gusto. Increasing the deficit by $850 billion in a single year is beyond the wildest imaginings of the least responsible budget mavens within a radius of three thousand miles from Washington.

Gail Collins: Mitt’s Zest for Zings

Mitt Romney arrived in New York City on Wednesday, newly endorsed by Christine O’Donnell, who we have not seen since her not-a-witch race for the U.S. Senate. She praised Romney for having “been consistent since he changed his mind.” I so miss Christine O’Donnell.

Romney was in town to raise money. Iowa and New Hampshire get the love; we get the traffic jams. ‘Twas ever thus. We’re not bitter, really.

However, he did sit down with The Times’s Jeff Zeleny and Ashley Parker to compare himself to Newt Gingrich. (The above-the-fray Mitt is so November.) “Zany is not what we need in a president,” he said.

I would say this is an extremely safe position for Romney to take because the odds are very good that no one has ever called Mitt zany in his entire life. Unless it was when he drove to Canada with the family dog strapped to the roof of the station wagon. (“Hey, Mister, you got an Irish setter on top of your car. What are you, zany or something?”)

Dec 15 2011

Senate Will Consider The NDAA Today: Up Dated

They who can give up essential liberty to obtain a little temporary safety, deserve neither liberty nor safety. ~ Benjamin Franklin

Up Date: The Senate voted for final passage for the NDAA conference report (H.R. 1540). The vote was overwhelming: 86-to-13. It now goes to President Obama for his signature.

President Obama has not yet signed the NDAA. It is not to late to tell him to veto this bill which will have a devastating effect on civil liberties and give unprecedented powers to the military and the Executive Branch. Send Obama a strong message sign the petition and send a letter:

President Obama: Veto the National Defense Authorization Act!

VETO the National Defense Authorization Act

This House passed the revised National Defense Authorization Act 283 – 136 with 93 Democrats and 43 Republicans voting against the bill. The Senate is scheduled to take up the bill later today. It inevitably pass with an overwhelming majority and be sent to President Obama to sign. Since the White has stated that they are satisfied with the minor changes, Obama will sign the bill which, as Human Rights Watch said in a press release, “a historic tragedy for rights:

(Washington, DC, December 14, 2011) – US President Barack Obama’s apparent decision to not veto a defense spending bill that codifies indefinite detention without trial into US law and expands the military’s role in holding terrorism suspects does enormous damage to the rule of law both in the US and abroad, Human Rights Watch said today. The Obama administration had threatened to veto the bill, the 2012 National Defense Authorization Act (NDAA), over detainee provisions, but on December 14, 2011, it issued a statement indicating the president would likely sign the legislation.

“By signing this defense spending bill, President Obama will go down in history as the president who enshrined indefinite detention without trial in US law,” said Kenneth Roth, executive director of Human Rights Watch. “In the past, Obama has lauded the importance of being on the right side of history, but today he is definitely on the wrong side.”

The far-reaching detainee provisions would codify indefinite detention without trial into US law for the first time since the McCarthy era when Congress in 1950 overrode the veto of then-President Harry Truman and passed the Internal Security Act. The bill would also bar the transfer of detainees currently held at Guantanamo into the US for any reason, including for trial. In addition, it would extend restrictions, imposed last year, on the transfer of detainees from Guantanamo to home or third countries – even those cleared for release by the administration.

(emphasis mine)

Glenn Greenwald at Salon wrote in his article this morning that there are “several persistent myths that circulating about this bill and President Obama’s position on it that need to be clarified once and for all:

  • First, while the powers this bill enshrines are indeed radical and dangerous, most of them already exist. That’s because first the Bush administration and now the Obama administration have aggressively argued that the original 2001 AUMF already empowers them to imprison people without charges, use force against even U.S. citizens without due process (Anwar Awlaki), and target not only members of Al Qaeda and the Taliban (as the law states) but also anyone who “substantially supports” those groups and/or “associated forces” (whatever those terms mean). [..]

    With a couple of exceptions, this bill just “clarifies” – and codifies – the powers President Obama has already claimed, seized and exercised. [..]

    This is the reason why civil libertarians have been so harshly critical of this President. It’s the reason civil liberties groups have been saying things like this even when saying them was so unpopular: it’s because Obama has, for three years now, been defending and entrenching exactly the detention powers this law vests, but doing it through radical legal theories, warped interprations (sic) of the 2001 AUMF, continuities with the Bush/Cheney template, and devotion to Endless War and the civil liberties assults (sic) it entails.

  • Second, as I documented at length last week, Obama’s veto threat was never about substantive objections to the detention powers vested by this bill; put another way, he was never objecting to the bill on civil liberties grounds. Obama, as I documented last week and again below, is not an opponent of indefinite detention; he’s a vigorous proponent of it, as evidenced by his contiuous (sic), multi-faceted embrace of that policy.

    Obama’s objections to this bill had nothing to do with civil liberties, due process or the Constitution. It had everything to do with Executive power. The White House’s complaint was that Congress had no business tying the hands of the President when deciding who should go into military detention, who should be denied a trial, which agencies should interrogate suspects (the FBI or the CIA). Such decisions, insisted the White House (pdf), are for the President, not Congress, to make. In other words, his veto threat was not grounded in the premise that indefinite military detention is wrong; it was grounded in the premise that it should be the President who decides who goes into military detention and why, not Congress.

  • Third, the most persistent and propagandistic set of myths about President Obama on detention issues is that he tried to end indefinite detention by closing Guantanamo, but was blocked by Congress from doing so. It is true that Congress blocked the closing of Guantanamo, and again in this bill, Congress is imposing virtually insurmountable restrictions on the transfer of detainees out of that camp, including for detainees who have long ago been cleared for release (restrictions that Obama is now going to sign into law). But – and this is not a hard point to understand – while Obama intended to close Guantanamo, he always planned – long before Congress acted – to preserve Guantanamo’s core injustice: indefinite detention.

    I need to say that again: long before, and fully independent of, anything Congress did, President Obama made clear that he was going to preserve the indefinite detention system at Guantanamo even once he closed the camp. That’s what makes the apologias over Obama and GITMO so misleading: the controversy over Guantanamo was not that about its locale – that it was based in the Carribean (sic) Ocean – so that simply closing it and then  re-locating it to a different venue would address the problem. The controversy over Guantanamo was that it was a prison camp where people were put in cages indefinitely, for decades or life, without being charged with any crime. And that policy is one that President Obama whole-heartedly embraced from the start.

  • All the evidence is that debunks the myth that Obama is concerned about the Constitution are there in Glen’s article.

    Ironically today 220 years ago in 1791, Virginia became the last state to ratify the Bill of Rights. If the Senate passes this horrendous assault on our civil liberties, most of that historic document will be undermined. I don’t believe this that is what our Founding Fathers intended.

    Dec 15 2011

    What real justice looks like.

    I don’t know if you woke up as horribly depressed today as I did, but I spent a long time looking for a single nugget of good news; that someone, somewhere still believed in Justice and The Rule of Law.

    JP Morgan Hit by Ripple Effects of Rakoff Decisions Nixing SEC No Admission Settlements

    Yves Smith, Naked Capitalism

    Wednesday, December 14, 2011

    Alison Frankel at Reuters highlights a new New York appellate court decision where JP Morgan is being hoist on the Rakoff petard. Bear Stearns, which is now owned by JP Morgan, entered into a $250 million settlement in 2006 over allegations that it cheated customers by engaging in impermissible market timing. The agreement contained standard SEC “without admitting wrongdoing or denying” language. The payment broke down into $160 million of disgorgement and $90 million of penalties.

    What may surprise many readers is that the $160 million disgorgment was covered by insurance, or at least JP Morgan thought it was.



    The insurers said no dice, and JP Morgan took them to court to try to force them to pay. The lower court decided in favor of JP Morgan, but the appeals court reversed.



    Putting on a public policy, rather than a legal hat, insurance that has the effect of letting companies and boards buy their way out of the economic consequences of bad conduct is a terrible idea. Even though it is widely accepted that no one would become a director of a public company ex directors and officers insurance, the consequences are detrimental. Why should, for instance, the directors of Lehman not be sued into penury? If we didn’t have D&O insurance, companies would have to pay directors a prince’s ransom to do the job, and a director would have to work really really hard at oversight. That would mean he could probably only sit on one board (ending the board as high level social club phenomenon, another plus) and would do a vastly better job. You’d also see an end to directors who serve as mere decoration (nice enough people, say college presidents or heads of heavyweight not for profits) but add bupkis in terms of monitoring management.

    Now I’ll admit we have not seen all the implications of the Rakoff decision, but this first one seems entirely salutary. I suspect on balance, the effect will be to give companies fewer “get out of jail free” cards, which is something that everyone but the SEC and public company executive should welcome.

    Dec 15 2011

    On this Day In History December 15

    This is your morning Open Thread. Pour your favorite beverage and review the past and comment on the future.

    How ironic that on this very day, Congress and President Barack Obama are about to approve a bill that will essentially violate at least 5 of these amendments and more.

    Find the past “On This Day in History” here.

    December 15 is the 349th day of the year (350th in leap years) in the Gregorian calendar. There are 16 days remaining until the end of the year.

    On this day 1791, Virginia becomes the last state to ratify the Bill of Rights, making the first ten amendments to the Constitution law and completing the revolutionary reforms begun by the Declaration of Independence. Before the Massachusetts ratifying convention would accept the Constitution, which they finally did in February 1788, the document’s Federalist supporters had to promise to create a Bill of Rights to be amended to the Constitution immediately upon the creation of a new government under the document.

    After the Constitution was ratified in 1789, the 1st United States Congress met in Federal Hall in New York City. Most of the delegates agreed that a “bill of rights” was needed and most of them agreed on the rights they believed should be enumerated.

    Madison, at the head of the Virginia delegation of the 1st Congress, had originally opposed a Bill of Rights but hoped to pre-empt a second Constitutional Convention that might have undone the difficult compromises of 1787: a second convention would open the entire Constitution to reconsideration and could undermine the work he and so many others had done in establishing the structure of the United States Government. Writing to Jefferson, he stated, “The friends of the Constitution…wish the revisal to be carried no farther than to supply additional guards for liberty…and are fixed in opposition to the risk of another Convention….It is equally certain that there are others who urge a second Convention with the insidious hope of throwing all things into Confusion, and of subverting the fabric just established, if not the Union itself.”

    Madison based much of the Bill of Rights on George Mason’s Virginia Declaration of Rights (1776), which itself had been written with Madison’s input. He carefully considered the state amendment recommendations as well. He looked for recommendations shared by many states to avoid controversy and reduce opposition to the ratification of the future amendments. Additionally, Madison’s work on the Bill of Rights reflected centuries of English law and philosophy, further modified by the principles of the American Revolution.

    Dec 15 2011

    My Little Town 20111214: Lucy the Cat

    Those of you that read this regular series know that I am from Hackett, Arkansas, just a mile or so from the Oklahoma border, and just about 10 miles south of the Arkansas River.  It was a redneck sort of place, and just zoom onto my previous posts to understand a bit about it.

    When I was around four or five years old, around 1961 or 1962, I begged my parents to get a cat for me.  I have always been more of a cat person than a dog person, but I really have nothing against dogs.  Cats and I just understand each other than dogs and I do.  That is while were still living in North Little Rock.

    My grandmum had been ill with a thyroid condition that required surgery, so my parents hired a very nice black lady by the name of Sadie to look after us during the day until my grandmum recovered from her surgery.  It just so happened that Sadie new someone who had a couple of kittens to give away, so we drove over to their house one Saturday and got Lucy.