Puerto Rico Without Electricity, Wifi, ATMs Shows Importance of Cash, Gold and Silver

– Puerto Rico without electricity, wifi, ATMs shows importance of cash, gold and silver
– Most of Puerto Rico remains in the dark and without power three weeks after storm
– With widespread power failures, Puerto Rico remains cash only with retailers only accepting cash and few consumer having cash

– Shortages of food, fuel and medicine with infrastructure repairs delayed
– Power could be ‘out for months’ as 85% of people remain off the grid
– Around 75% of ATMs disconnected
– Electronic forms of payment including bitcoin have been rendered non viable
– Puerto Rico’s accidental ‘cashless society’ shows risks of cashless society and importance of holding cash, gold and silver out of the financial and digital systems

Editor: Mark O’Byrne

Aerial photo of flooding in Puerto Rico. Washington Post

Puerto Rico has been destroyed by two savage hurricanes which have plunged the island into darkness and despair. The landscape of ruined homes and entire towns resembles Hiroshima after the man made disaster of a nuclear  bomb being dropped on the city.

More than three weeks since Hurricane Maria hit the island, 3.7 million American citizens are on the precipice of a humanitarian disaster.  The majority of these people are desperate for food, water, electricity and shelter. They are desperate for cash that will allow them to secure these basic necessities.

Over 84% of the island remains without power and 37% of people are without access to water. Without power, much of the population is does not have electricity to charge their phones and iphones. Very few have wifi and this is severely impacting their ability to communicate and conduct their lives.

Inevitably, the future of Puerto Rico now lies in the wrangling hands of government and financial organisations, all of which seem to be pointing the finger of blame at one another.

The territory’s government expects to run out of cash by the end of the month.  It has asked Congress for an immediate payment of $6 billion to $8 billion. This is to meet vital expenses including salaries, emergency repairs, and pension payments.

“We will run out of cash as of Oct. 31 of this year,” said Raul Maldonado, the territory’s treasury secretary. “As of November, we will not be able to operate as a normal government.”

Given the country’s dire electronic and communications situation, tax receipts are way down which will likely exacerbate the dire economic situation even further.

Problems are not just at a government level. Day-to-day life for Puerto Ricans is also obviously extremely hard and increasingly dangerous. The island is in a cash black-hole with little access to or means to buy essentials.

Not only is there a shortage of cash but the majority of ATMs are down. Even if cash was aplenty, few people are able to withdraw pay checks or access their digital savings and make payments electronically.

It is a stark reminder of how reliant our economies and day-to-day lives are on electricity. It is a stark reminder of how dependent  our modern digital currencies – whether they be public fiat or private crypto currencies – are on increasingly antiquated electricity and power infrastructures.

Today the faith we put in governments that basic utilities will continue regardless is unprecedented. Citizens in Western nations rarely (if ever) question how they would manage if they had no access to electronic money or bank accounts and could make digital payments online or by credit and debit cards.

Puerto Rico should be a warning to us all. No matter how wealthy your country, how “sophisticated’ your central bankers and central banking system and how technologically advanced your infrastructure,  we can all be rendered poor overnight by the power of Mother Nature.


‘You’re broke even if you have money’ 

‘Cash Only’ is reportedly a common phrase across many of the retailers on the territory. The majority of gas stations and grocery stores are only accepting cash payments. Citizens have little choice but to try and find cash.

However, shoppers have the same problem retailers do – they can’t get the cash they need. Reports the New York Times:

Fewer than half of Puerto Rico’s bank branches and cash machines are up and running, still crippled by diesel shortages, damaged roads and severed communications lines. Bank officials say they are struggling even to find employees who can get to work when there is no public transportation and gasoline is hard to find.

Across the island, people who have spent their last dollars on an $8 bag of ice or $15 for gasoline are waiting for hours outside banks and A.T.M.s in hopes of withdrawing as much money as possible.

“You’re broke even if you have money,” Mr. Jimenez told the New York Times.

But is there really a cash shortage? Zoime Alvarez, vice president of the Association of Banks of Puerto Rico told the New York Times that not only was there already enough cash on Puerto Rico but there was more arriving to meet what the New York Federal Reserve called “extraordinarily high demand.”

Does this matter though when there is electricity failure across the island? This isn’t the only problem – transport networks are down and organisations are struggling to deliver goods and services.

The infrastructure issues are unlikely to be fixed soon.

Already in a bad way

It’s no secret that prior to Hurricane Maria, Puerto Rico was already in a poor financial state. Private creditors were circling looking for the $74 billion that has been lent to the island in recent years. Now the cash situation is set to get even worse.

A federal government bill is set to increase the island’s liabilities by a further 14%.

In addition to the country’s $74 billion in bond debt, there is also a further $49 billion in pension obligations.

With this sorts of liabilities its unlikely creditors are going to put much faith in the future of the island. Whilst Congress is likely to agree some funding, it will not help the territory with its long-term finance issues.

This will no doubt exacerbate increasing unemployment numbers and criminal activity.

Cash and electricity shortages are forcing some residents into a bartering and others into borderline criminal activities as they seek out ways to find more cash.

Mr. Jimenez, who waited in line outside Scotiabank, said the cash shortage forced him to get creative and tiptoe into the black market. Here in his eastern hometown, Fajardo, he was able to use his credit card to buy several packs of Newport cigarettes from a big-box retailer before the store ran out of diesel and had to shut down.

He and his wife traversed their neighborhood, selling packs of cigarettes for $10 each. Mr. Jimenez said he was not trying to make money — just to stockpile cash to use at the gas stations and markets that now accepted nothing else.

“I’m like a drug dealer,” he joked.

Prior to the hurricane residents were warned to stock up on all essentials, but few could have realised just how important cash would become.

Few people appreciate this. In times of disaster like this, cash becomes king. Followed closely by gold and silver which can be traded for cash or used as deposits or for payment for life’s necessities.

Most shopkeepers who are struggling to sell their merchandise as they cannot take electronic payments and whose potential customers do not have cash will gladly accept small gold and silver coins and bars as payment in lieu of cash.

Coin dealers, jewellers who buy from the public and pawnbrokers in Puerto Rico have been very busy since the crisis as people exchange gold and silver jewellery and bullion coins and bars for cash.

Ironically, less and less governments want us to have access to cash, let alone to gold and silver, and this is making us more fragile financially.

Our economies are more vulnerable than ever in this regard and the modern drive to embrace all forms of digital currencies and the cashless society is setting ourselves up for an even bigger fall.

No cash transactions means no transactions

The Puerto Rico problem will only get worse. Not only are ATM and banking networks down but employers and government cannot make payments they need to make to individuals’ accounts.

In the long-term this is a problem likely to be faced by many nations that rely solely on electronic systems for all payments.

We have previously discussed the push by governments and banks to a cashless society. In the United Kingdom, 89% of the total value of consumer payments are non-cash payments. In Canada, it’s 90%.

Disasters such as Puerto Rico do not appear to be considered by banks and governments who claim cashless societies are better for all. Reasons for going cashless include clamping down on tax evasion, illegal cash activities and increased spending.

However, when an electricity and overall infrastructure crisis hits (as we see in Puerto Rico) the ‘convenience’ of a cashless society quickly falls flat on its face.

This is also the situation for anyone who was hoping bitcoin (or ‘insert another cryptocurrency’) might be the answer when banking systems can’t operate. However bitcoin transactions require electricity, a lot of it, and wifi. As with cashless fiat transactions they are as problematic when there is no power.

This is why in times of such crisis there is such demand for not only hard cold cash but also for gold and silver. None of them can suddenly become inaccessible thanks to power shortages or the inability of a government to sort out local infrastructure.

Too late for cash?

For now the Puerto Ricans are ‘fortunate’ that their currency is the U.S. Dollar. This means the value of the cash in their accounts is unlikely to be majorly affected by Hurricane Maria and the resulting crisis.

But if Puerto Rico were an independent nation then it would almost certainly be experiencing a fall in its currency. At this point all of the goods and services it needed to import in order to help it to recover would be increasingly expensive – as seen in the UK after Brexit.

Meanwhile gold and silver would be accepted as they are borderless currencies that do not operate within the confines of a government, central bank or electronic system.

Gold and silver often get a bad rap when it comes to discussions about their role as money. Both are pushed to the bottom of the pile when you consider the convenience of spending them compared to the likes of electronic cash, paper notes and bitcoin.

But one thing that is guaranteed with them is that you know you can use them in times of crisis. They are highly durable and highly desired. That is not the case with fiat or bitcoin when it comes to the crunch as seen in Puerto Rico in recent days.

No matter the town, city or country you find yourself in, times such as these pose multiple threats whether military or natural.

We all assume that governments are competent and will look after us. We cannot bring ourselves to imagine electricity systems and our banking systems including ATMs going down and not having access to our hard earned savings.

But it happens, all too many times as this last hurricane season has demonstrated. Prudent savers who like to be prepared should consider the magnitude of disasters such as Hurricane Maria – food runs out and electricity goes down.

You think you are wealthy and then suddenly, you have nothing.

You need cash and means of exchange in order to survive.

Diversifying your emergency funds should be a priority, this means hold some cash and gold and silver coins and bars to ensure you can survive and thrive with or without government’s help.

Best to hope for the best but be prepared for less benign scenarios.

The people of Puerto Rico would attest to the power of this today.
Source: Zero Hedge

Important GuidesFor your perusal, below are our most popular guides in 2017:

Essential Guide To Storing Gold In Switzerland

Essential Guide To Storing Gold In Singapore

Essential Guide to Tax Free Gold Sovereigns (UK)

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Mark O’Byrne
Executive Director

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Friday Funnies – I miss the old America when horses were horses


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keep dreaming America, you will get nothing

Authored by John Mauldin via MauldinEconomics.com,

In the US, we have two national programs to care for the elderly.

Social Security provides a small pension, and Medicare covers medical expenses.

All workers pay taxes that supposedly fund the benefits we may someday receive.

The problem is that’s not actually true. Neither of these programs is comprehensive.

The End of Government Entitlements

Living on Social Security benefits alone is a pretty meager existence.

Medicare has deductibles and copayments that can add up quickly. Both programs assume people have their own savings and other resources (I wrote about this in detail in my previous issues of Thoughts from the Frontline). Despite this, the programs are crucial to millions of retirees, many of whom work well past 65 just to make ends meet.

This chart from my friend John Burns shows the growing trend among generations to work past age 65:

Having turned 68 a few days ago, I guess I’m contributing a bit to the trend

Limited though Social Security and Medicare are, we attribute one huge benefit to them: They’re guaranteed. Uncle Sam will always pay them – he promised. And to his credit, Uncle Sam is trying hard to keep his end of the deal.

Uncle Sam’s Debt Nightmare

In fact, Uncle Sam is running up debt to do so. Actually, a massive amount of debt:

Federal debt as a percentage of GDP has almost doubled since the turn of the century. The big jump occurred during the 2007–2009 recession, but the debt has kept growing since then. That’s a consequence of both higher spending and lower GDP growth.

In theory, Social Security and Medicare don’t count here. Their funding goes into separate trust funds. But in reality, the Treasury borrows from the trust funds, so they simply hold more government debt.

Today it looks like this:

  • Debt held by the public: $14.4 trillion
  • Intragovernmental holdings (the trust funds): $5.4 trillion
  • Total public debt: $19.8 trillion

Total GDP is roughly $19.3 trillion, so the federal debt is about equal to one full year of the entire nation’s collective economic output. That total does not also count the $3 trillion-plus of state and local debt, which in almost every other country of the world is included in their national debt numbers.

Including state and local debt in US figures would take our debt-to-GDP above 115%… and rising.

Just wait. We’re only getting started.

$210 Trillion Worth of Unfunded Liabilities

An old statute requires the Treasury to issue an annual financial statement, similar to a corporation’s annual report. The FY 2016 edition is 274 enlightening pages that the government hopes none of us will read.

Among the many tidbits, it contains a table on page 63 that reveals the net present value of the US government’s 75-year future liability for Social Security and Medicare.

That amount exceeds the net present value of the tax revenue designated to pay those benefits by $46.7 trillion. Yes, trillions.

Where will this $46.7 trillion come from? We don’t know.

Future Congresses will have to find it somewhere. This is the fabled “unfunded liability” you hear about from deficit hawks. Similar promises exist to military and civil service retirees and assorted smaller groups, too.

Trying to add them up quickly becomes an exercise in absurdity. They are so huge that it’s hard to believe the government will pay them, promises or not.

Now, I know this is going to come as a shock, but that $46.7 trillion of unfunded liabilities is pretty much a lie. My friend Professor Larry Kotlikoff estimates the unfunded liabilities to be closer to $210 trillion.

Pensions Are a Lie

Many Americans think of “their” Social Security like a contract, similar to insurance benefits or personal property. The money that comes out of our paychecks is labeled FICA, which stands for Federal Insurance Contributions Act. We paid in all those years, so it’s just our own money coming back to us.

That’s a perfectly understandable viewpoint. It’s also wrong.

A 1960 Supreme Court case, Flemming vs. Nestor, ruled that Social Security is not insurance or any other kind of property. The law obligates you to make FICA “contributions.”

It does not obligate the government to give you anything back. FICA is simply a tax, like income tax or any other. The amount you pay in does figure into your benefit amount, but Congress can change that benefit any time it wishes.

Again, to make this clear: Your Social Security benefits are guaranteed under current law, but Congress reserves the right to change the law. They can give you more, or less, or nothing at all, and your only recourse is the ballot box.

Medicare didn’t yet exist in 1960, but I think Flemming vs. Nestor would apply to it, too. None of us have a “right” to healthcare benefits just because we have paid Medicare taxes all our lives. We are at Washington’s mercy.

I’m not suggesting Congress is about to change anything. My point is about promises. As a moral or political matter, it’s true that Washington promised us all these things. As a legal matter, however, no such promise exists. You can’t sue the government to get what you’re owed because it doesn’t “owe” you anything.

This distinction doesn’t matter right now, but I bet it will someday. If we Baby Boomers figure out ways to stay alive longer, and younger generations don’t accelerate the production of new taxpayers, something will have to give.

If you are dependent on Social Security to fund your retirement, recognize that your future is an unfunded liability a promise that’s not really a promise because it can change at any time. 

*  *  *

Get one of the world’s most widely read investment newsletters… free. Sharp macroeconomic analysis, big market calls, and shrewd predictions are all in a week’s work for visionary thinker and acclaimed financial expert John Mauldin. Since 2001, investors have turned to his Thoughts from the Frontline to be informed about what’s really going on in the economy. Join hundreds of thousands of readers, and get it free in your inbox every week.


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Home Depot Panics Over Millennials; Forced To Host Tutorials On Using Tape Measures, Hammering Nails

As wall street analysts celebrate the coming of age of the millennial generation, a group of young people who were supposed to lead another revolutionary wave of consumerism if only they could work long enough to escape their parents’ basement, retailers like Home Depot are panicked about selling into what will soon be America’s largest demographic…but not for the reasons you might think.

While avocado resellers like Whole Foods only have to worry about creating a catchy advertising campaign to attract millennials, Home Depot is in full-on panic mode after realizing that an entire generation of Americans have absolutely no clue how to use their products.  As the Wall Street Journal points out, the company has been forced to spend millions to create video tutorials and host in-store classes on how to do everything from using a tape measure to mopping a floor and hammering a nail.

Home Depot’s VP of marketing admits she was originally hesitant because she thought some of their videos might be a bit too “condescending” but she quickly learned they were very necessary for our pampered millennials.

In June the company introduced a series of online workshops, including videos on how to use a tape measure and how to hide cords, that were so basic some executives worried they were condescending. “You have to start somewhere,” Mr. Decker says.

 

Lisa DeStefano, Home Depot vice president of marketing, initially hesitated looking over the list of proposed video lessons, chosen based on high-frequency online search queries. “Were we selling people short? Were these just too obvious?” she says she asked her team. On the tape-measure tutorial, “I said ‘come on, how many things can you say about it?’ ” Ms. DeStefano says.

And just in case you think we’re joking and/or exaggerating, here is Home Depot’s tape measure tutorial in all its glory:

 

Meanwhile, Scotts Miracle-Gro has been forced to start training classes to remind frustrated millennials, who can’t seem to keep their flowers alive, that plants need sunlight to grow (apparently not a single millennial ever took biology in grade school).  Commenting on the tutorials, a defeated VP of Corporate Affairs, Jim King, admitted “these are simple things we wouldn’t have really thought to do or needed to do 15 to 20 years ago”…sorry, Mr. King this is your life now.

The Scotts Miracle-Gro Co. has started offering gardening lessons for young homeowners that cover basic tips—really, really basic—like making sure sunlight can reach plants.

 

“These are simple things we wouldn’t have really thought to do or needed to do 15 to 20 years ago,” says Jim King, senior vice president of corporate affairs for Scotts. “But this is a group who may not have grown up putting their hands in the dirt growing their vegetable garden in mom and dad’s backyard.”

 

“They grew up playing soccer, having dance recitals and playing an Xbox,” says Scott’s Mr. King. “They probably didn’t spend as much time helping mom and dad out in the yard as their predecessors or their predecessors’ predecessors.”

 

Companies such as Scotts, Home Depot Inc., Procter & Gamble Co. , Williams-Sonoma Inc.’s West Elm and the Sherwin-Williams Co. are hosting classes and online tutorials to teach such basic skills as how to mow the lawn, use a tape measure, mop a floor, hammer a nail and pick a paint color.

Unfortunately, at least for the Home Depots of the world, millennials now represent the largest demographic in America with 4.75 million 26 year olds roaming the streets of New York, San Francisco and Los Angeles without a clue as to how to use a tape measure.

The biggest single age cohort today in the U.S. is 26-year-olds, who number 4.8 million, according to Torsten Slok, chief international economist for Deutsche Bank . People 25, 27 and 24 follow close behind, in that order. Many are on the verge of life-defining moments such as choosing a career, buying a house and having children.

 

Millennials as a whole are America’s latest demographic bubble, overtaking the baby boom generation and, like them, transforming popular culture, retailing, media and lifestyles. They make up about 42% of all home buyers today, and 71% of all first-time home buyers, according to Zillow Group . Some 86% of millennial home buyers reported making at least one improvement to their home in the past year, more than any other generation, Zillow says.

 

While we have our doubts that it will save their business, retailers like J.C. Penney and West Elm are trying to adapt to the millennial generation by offering basic in-home services like installing televisions or hanging wall art.

J.C. Penney Co. says the group is willing to hire others for projects. The retailer has pushed into home services, including furnace and air-conditioning repair, water-treatment systems and bathroom renovations, and expanded its window-covering installation.

 

“They’re much more of a ‘Do-It-for-Me’ type of customer than a ‘Do-It-Yourself’ customer,” says Joe McFarland, executive vice president of J.C. Penney stores. “You don’t need a ladder or a power drill, you don’t even have to wonder if you measured your window right.”

 

Home-furnishings retailer West Elm offers service packages, which start at $129, to provide plumbing and electrical work, painting, installing a television and hanging wall art and mirrors.

 

All that said, at least some millennials are trying to be more self-sufficient…as an example, the WSJ notes the case of 26-year-old Breanne Loes who recently borrowed her dad’s power tools to craft a wooden headboard…which went really well AFTER she realized the saw blade was on backwards.

Ms. Loes enjoys do-it-yourself projects, and two summers ago built with her now-husband a wooden headboard in her parents’ garage, with help from an online tutorial, her dad, two older brothers and their tools.

 

The saw wasn’t working at first because the blade was backward. “That was embarrassing,” says Ms. Loes.

Congrats, Breanne, really great job…really.


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I hope Trump can eviscerate the CIA before they do him

Unsealed CIA Memos Provide Shocking ‘Salt Pit’ Black Site Details

A new batch of 274 CIA documents connected with Bush era torture have just been made public as a result of a lawsuit brought by families of victims. Contained in the documents are newly unearthed details on the CIA’s “black site” program which reached its peak under Bush’s ‘war on terror’ as well as shocking details revealing how the agency integrated its contract psychologists into its ‘enhanced interrogation’ program in order to give torture a veneer of legality. While much of this story of CIA torture has already slowly come to light over the past few years, especially with the 2014 Senate Intelligence Committee report, the just released documents capture internal high level agency discussions revealing a cover-up in action.

Many of the memos focus on the CIA’s infamous ‘Cobalt’ site in Afghanistan (also code named The Salt Pit), routinely described in headlines as the “sadistic dungeon” and “dark prison” for its full sensory deprivation darkness which detainees experienced round the clock, sometimes for years, as well as the two psychologists credited with designing the program of brutal interrogation techniques: John “Bruce” Jessen and James Mitchell.

Two surviving prisoners and the family of a detainee who died at the Colbalt site reached an out-of-court settlement with the CIA psychologists in August after a lawsuit was brought for their role in the torture. As was hoped, the CIA and Pentagon were forced to declassify the documents related to the case in pretrial discovery. 


Satellite image of Cobalt site, also called the Salt Pitt, from now public documents.

The documents show the psychologists had been directly involved in designing and implementing torture, and that the blurring of lines between CIA interrogators and the psychologists originally brought in for “research” and development of techniques had agency leadership worried over future legal ramifications. Jessen himself had spent 10 days at the Cobalt facility in November 2002 where he was involved in interrogating Gul Rahman – a suspected militant who died of hypothermia while chained naked from the waist down to a concrete floor. He died 5 days after Jessen left.

Ironically, a key fact rarely highlighted is that Gul Rahman was captured among Gulbuddin Hekmatyar’s Hezb-i-Islami faction, which itself had previously been funded and vastly expanded by the CIA  as part of Operation Cyclone. By 2010 terror leader Hekmatyar himself would enter negotiations with then President Karzai, and by 2017 would be fully reconciled with the US-backed government in Kabul.


Dr. Bruce Jessen, left, and Dr. James Mitchell, psychologists who contracted with the C.I.A.

The Guardian summarizes the newly released “Chronology of Significant Events” court findings covering the specific time period of Rahman’s slow death at the Salt Pit as follows:

  • November 2002: Rahman wearing only socks and diaper; supervisor has concern regarding hypothermia
  • Rahman subjected to 48 hours of sleep deprivation, rough treatment, cold shower and other measures but remained noncompliant.
  • Subjected to cold conditions and minimum food and sleep… confused due to dehydration and fatigue.
  • Cable recommends future use of continued environmental deprivations with interrogations 18 out of 24 hours daily
  • Linguist asks questions about the temperature at which hypothermia occurs
  • November 19 2200 hrs guard check – Rahman is alive.
  • 2300 hrs guard check – Rahman is alive.
  • November 20 0400 hrs guard check – Rahman is alive.
  • 0800 hrs guard check – Rahman is alive.
  • 1000 hrs guard check – Rahman is dead.

The Guardian further describes the now declassified documents as providing “the fullest picture yet of what the three men suffered [associated with the lawsuit] in that secret CIA dungeon – and of how fatefully their lives intersected with the rise and fall of James Mitchell and Bruce Jessen, the men who designed the torture regime.”

Highlighted below are some revealing sections from the newly released batch of CIA torture memos – some of the below were already available before the latest release:

CIA contracted psychologists created an “Exploitation Draft Plan” which involved holding captives in soundproof cells in hidden facilities that were beyond the reach of the Red Cross, the press, and even internal US government oversight. The plan notes: No International Red Cross [IRC] nor even US observers. Detainees were essentially “disappeared” individuals and not even family members knowing their fates. Rahman’s family didn’t know of his whereabouts or death for seven years until an AP report unearthed his name. As noted in the below memo, Pentagon involvement ended with capture and transfer as a DoD psychologist accompanied the captive “unbeknown to the subject” after which the CIA psychologists would be involved in interrogation.

Particularly intense “interrogation” sessions involved medical personnel attending to detainee wounds, and even applying antibiotics, so that torture could continue: “The straps were removed: subjects breathing continued to be rapid. Subject was then instructed to off the [water] board under his own power, which he did. The interrogators pointed to the small box and said, ‘you know what to do.’… At 1130 hours, taken out of small box, hooded, and made to stand against a cell wall: at 1230 hrs, back into the large box (unhooded)–note that medical officers dressed as security team member at this time gave subject Betadine to clean wound. Subject was also given a topical antibiotic to apply to the leg wound… At 1450 hrs, back to large box. At 1601 hrs into small box: 1612 hrs, subject was heard crying/wimpering/chanting, 1635 went from small box to floor, sitting down hooded; and 1655 hrs, returned to large box, unhooded…”

CIA leadership envisioned that psychologists Jessen and Mitchel would provide a legally “defensible” veneer to torture sessions (after being paid $81 million). So long as their personal assessments vouched for detainees being of mentally sound mind, “enhanced interrogations” could be initiated. “In my read of the DOJ memo, providing we abide by our water board process on [redacted] (qualified medical staff present, the defensible exam is done and we follow our procedures) I believe the water board can be approved by CTC/LGL [CIA’s internal legal review team] without the need for further input from DOJ.” Jessen and Mitchel were paid $81 million by the CIA in the process.

CIA leadership suggested psych evals be done from afar based on mere review of a file in order to set up a minimally invasive rubber stamp process. “to get waterboard approvals, we need a psychological evaluation… [Name redacted] indicated that we need to make a ‘defensible’ psychological analysis indicating that, given the individual’s particular mental disposition, he would not suffer prolonged and sever psychological problems resulting from the enhanced interrogation techniques… can OTS make a defensible analysis based on a file review on the targets? Or do they need to have a psych eval done on the ground, face-to-face?  [Name redacted] indicates that all it must [be] is ‘defensible.'”

Doctors and nurses were requested to be present during sessions. One email with the subject line “Medical coverage planning” asked “There would be nurses on site correct?” This was presumably to allow torture to continue after detainees were injured, wounded, or sick – while also preventing those running the program from being legally exposed to prosecution.

Internal admissions of “blatant disregard for ethics”: CIA contracted psychologists’ ethics were questioned even by colleagues. They “have both shown blatant disregard for the ethics shared by almost all of their colleagues.” Other emails admitted: “No professional in the field would credit their later judgments as psychologists assessing the subjects of their enhanced measures.” And also, “if some untoward outcome is later to be explained, their sole use in this role will be indefensible.”


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