What's Up with the Stock Market?

Is the Dow Jones Industrial Average rising in a manipulated rally or is it heading to new highs at 15,000?

Correspondent Peter B. is wondering why no one in the mainstream media is speaking to the obvious manipulation of the stock market:

I have been watching the markets(specifically the Dow Jones Industrial average) for a while and the last month has been very interesting. And yet I haven't heard any commentary on the blindingly obvious. For the last 8 trading days (11 on the Nasdaq), the market has gone straight up. The markets "never" just go up, let along straight up. Therefore this is "impossible" and can only happen in a manipulated circumstance. Likewise, several weeks previous to this, the markets tracked sideways for 5 trading days. The markets are never static or regular. A market doing the things that it is at present is no market at all, it is effectively insane - disconnected from any objective reality. That cannot be a good thing and yet I have heard no comments about it at all, everyone seems to be avoiding looking or seeing.

Excellent topic, Peter, thank you. The answer provided by the MSM is unequivocal: what manipulation? We're in a gigantic Bull market!

Dow 15,000, Here We Come: Stocks Going to New Highs.

Charles Lemonides, chief investment officer with ValueWorks, says there's plenty of upside left, thanks to improving fundamentals. "When you have better economic conditions and really, really compelling valuations; and you're bumping up against the top end of a range it’s sort of a good recipe for breaking through that range and going significantly higher," he says.

By "compelling valuations," do you mean a PE of 116 on the S&P 500, when PEs at historical lows are around 6 or 7? Is a New Depression really "better economic conditions"?

Shall we be polite and observe that there is a considerable spectrum of opinion on the stock market's future trend?

Is the market being manipulated? To answer that, we might ask: but aren't all markets always being manipulated? And the answer is yes: the gap between those who know something the rest of the players do not know has always been exploited. Thus the trader in 1700 who knew an overdue Spice Trade ship would soon arrive in Amsterdam would be able to buy options on that ship's cargo value (zero if the ship sank, astronomical if it arrived safely) at a low cost due to the rest of the market being ignorant of the ship's whereabouts.

What's different about this standard exploitation of the knowledge gap is that the trading desks of major firms are now in collusion with the government and with the market exchanges. Goldman Sachs' "front-running" scheme of making trades milliseconds ahead of other trades required the collusion of both the exchanges and the toothless, corrupt "watchdog" agencies of the U.S. government.

The Federal Reserve and the Treasury have many tools besides collusion to boost a zombie stock market to new heights: flooding the markets with new liquidity, lowering discount rates to make money cheap enough it can chase high-risk stocks, and of course outright purchasing of futures and similar direct manipulations.

Then there's the stock-in-trade of market manipulation: phony accounting. Today Ford announced a $2 billion "profit" as a result of accounting trickery--yet the headlines scream "profit" as if the ailing automaker actually manufactured and sold vehicles at a profit.

Exploiting insider knowledge is the game plan not just of the stock market but of globalization. Economist Joseph Stiglitz, loathed in the halls of power for questioning the status quo, made the case in his book, Globalization and Its Discontents

Joseph Stiglitz predicted the global financial meltdown. So why can't he get any respect here at home? (Newsweek)

The work that won Stiglitz the Nobel in 2001 showed how "imperfect" information that is unequally shared by participants in a transaction can make markets go haywire, giving unfair advantage to one party. The subprime scandal was all about people who knew a lot—like mortgage lenders and Wall Street derivatives traders—exploiting people who had less information, like global investors who bought up subprime- mortgage-backed securities. As Stiglitz puts it: "Globalization opened up opportunities to find new people to exploit their ignorance. And we found them."

The same can be said of the stock market. For context, here are two charts, courtesy of frequent contributor Harun I., which I published earlier in the year. I have updated the first to show that the current rally has essentially run to the 38.2% fibonacci projection around 8900-9000, which coincidentllay marks the January 2009 high water mark of the Dow (9.060 or so).

The market manipulators would dearly love to goose the Dow above this mark, as that would "signal a new Bull Market."

Here's a long view of the Dow, from 1920 to the present:

Can the market really make new heights as the economy implodes? As I type this, the players have boosted the Dow to the much-desired 9,000 level. Is this the start of the widely heralded New Bull Market?

I don't know, but Dow 100,000 looks entirely plausible. Oops, I meant Dow 1,000. Take your pick.


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IPO Offer from Goldman Sachs: the U.S. Governmen

This initial public offering for the U.S. Government crossed my desk and I thought it worth sharing.

An apparently confidential IPO found its way to me and I reckoned it was worth sharing: it's an IPO for the U.S. Government, underwritten by Goldman Sachs:

THIS IS NOT A SOLICITATION TO PURCHASE OFFERED SECURITIES, BUT YOU'D BEEN A COMPLETE MORON IF YOU PASSED UP THIS GOLDMAN, OOPS, GOLDEN OPPORTUNITY.

In conjunction with its junior underwriting partners (international banks), Goldman Sachs is pleased to offer shares in a unique initial public offering: the Federal Government of the United States of America.

As proxy owner of the Federal Reserve and the U.S. Treasury, Goldman Sachs is in a unique position to realize the full value of owning shares in the U.S. Government, as Goldman Sach's proxy ownership has yielded astounding profits.

The U.S. Government (USAG) has a number of features which offer investors extraordinarily unique long-term opportunities. As the sole global empire, the USAG has an unmatched ability to obtain, borrow, connive, plunder, discount or otherwise control key assets such as the largest remaining reserves of fossil fuels (Mideast) and surplus capital (China's foreign reserves).

The USAG does have substantial liabilities which carry significant risks to investors. However, Goldman Sachs believes these unfunded liabilities in the approximate range of $50 to $75 trillion can be set aside in favor of the $23 trillion in profits to the banking and investment sectors which are flowing from the TARP and other bailout programs designed and managed by Goldman Sach proxies in the Federal Reserve and the U.S. Treasury.

As the most significant unfunded liabilities, Social Security and Medicare, are sliding irrevocably into insolvency, Goldman Sachs believes these liabilities can be jettisoned by legislative actions taken by its proxies in Congress and regulatory actions taken by its proxies in the Executive, Treasury and Judicial branches of the USAG. This will free the revenues streams generated by taxation to flow directly into the owners of the USAG, Goldman Sachs, its international bank partners and shareholders in this IPO.

Although the underwriters (Goldman Sachs and partners) anticipate a steady flow of profits from the $23 trillion being funneled into bailouts and backstops, other significant if unlikely risks include thermonuclear war due to Imperial over-reach, the financial destruction of middle class taxpayers, and insurrection of the debt-serfs who constitute the majority of citizens living under the control of the USAG.

The IPO also offers unmatched opportunities for global exploitation and profits as a result of alliances and agreements with other cartels such as the Peoples Republic of China, the European Union, the Union of Oil Kleptocracies and other international organizations whch control and exploit the planet's populace and resources.

Large shareholders in the USAG will also gain other substantial benefits such as access to heavily fortified islands in the Caribbean and Pacific and special status in Switzerland.

Private junkets on Imperial cruisers and aircraft carriers will also be available by invitation to selected shareholders.

This offering and all subsequent actions of the U.S. Government will be under the management of Goldman Sachs and its international partners.

So there you have it: buy your shares now if you want a slice of that $23 trillion in taxpayer-funded swag flowing into investment and money-center international banks. The debt-serfs won't even notice any difference after the IPO is completed: meet the new boss, same as the old boss.

If you want more troubling/revolutionary/annoying analysis, please read Free eBook now available: HTML version: Survival+: Structuring Prosperity for Yourself and the Nation (PDF version (111 pages): Survival+)

"Your book is truly a revolutionary act." Kenneth R.

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Denial, Fear, Anger: The Real Depression Part II

Those of us who have long studied Peak Oil and other issues tend to underestimate the shock, denial, fear and anger of the newly exposed.

Correspondent D. recently submitted this startling (at least to me) report:

We received a huge disappointment from our next-door neighbor last week. Having been inspired and encouraged by your writings to try and "reach out" to begin to form a community of like-minded souls, and also to foment discourse about the Great Transformation, we loaned him the copy of Survival+ that we’d printed out.

We thought he’d appreciate the warning and the inspiration provided in your book. And so we were stunned the next day when we were walking down our street, and our neighbor, seeing us go by, raced down his driveway and practically threw your book at my husband, then turned and marched away. What the heck?!!

I was surprised and disturbed that Survival+ would evoke so violent a rejection, and wrote to D. that perhaps the book was "like straight gasoline," that is, full-strength and highly flammable. D. replied:

After I read your reply yesterday, I realized that it might have been unintentionally cruel of us to have dropped such a powerful book into our neighbor’s lap. Mea culpa! I should’ve remembered how panicky I felt when my husband asked me to start reading the various Peak Oil websites last summer, and how upset and shocked I felt at learning about the true state of affairs in this country.

Thank you, D., for sharing this first-hand report. When I recounted the story to my wife, she suggested that the gentleman's reaction showed there was some truth in the book, for if it had been without any truth the gent would have dismissed it with a shrug. I think there is something in that notion: when our world is threatened, we respond with shock, denial and then an anger which masks our fear.

This chain of thought leads back to Janet's statement from The Fluttering Pulse of Entitlement Nation: "I sensed (maybe this sounds crazy) a lot of anger and hostility in the crowd (at a diner)." Steve R. then suggested in Denial, Fear, Anger: The Real Depression Part I that "This undercurrent of anger may reflect a general feeling of betrayal by the system."

I think the hostility has multiple roots:

1. The sense of betrayal by a system which was presented by the Powers That Be as fair, sound, beneficial to everyone, etc.

2. The betrayal one feels when a "sure bet" goes bad and is lost.

3. The anger we feel toward ourselves for making poor judgments, but which we project onto others to spare ourselves the pain of responsibility.

4. The anger which humans use to cover a deep, abiding fear.

There may be more sources, but this list begins the process of parsing the complex emotions which are being unleashed by rising unemployment, the loss of homeownership, equity and the hope of easy wealth, and a fear that the future will not be as bright as we once assumed.

Frequent contributor Harun I. made these observations about self-delusion, greed and responsibility:

From the Mayans to the Romans, from Asia to Europe and now the U.S., all empires seem to experience a series of psychotic episodes that lead to their decline. It seems as if it is a necessary ingredient. What military might cannot bring down, self-delusion will.

However, I cannot accept that the idea that because we responded as encouraged, anger is now justifiable. What ever happened to that pithy adage, "you can lead a horse to water but you can't make him drink"? This represented choice. After all the history (which can be easily "googled" today) of bubbles and manias, how did we fall for it again?

I can think of nothing more potentially damaging to the psychological well-being of an individual than telling him/her, "its not your fault, you had no choice." I'd like to think that humankind is smarter than horses and do not involuntarily salivate when they hear a dinner bell.

I told my seven-year-old daughter to hold her breath and that it was okay because I would be breathing. She looked at me quizzically but complied (she innately understood the absurdity of the proposition).After she could no longer hold her breath, she blew it out and did the obligatory gasping. I asked her why she let out her breath. She yelled at me angrily, "DADDY, YOU CAN'T BREATHE FOR ME. I HAD TO BREATHE OR I WOULD DIE!" I smiled and quietly told her, "Just as breathing is essential to life and can be done only by you for you, so is thinking. Do not ever believe that you can let someone else do your thinking."

What was this so called dream? Regardless of the different forms in which it is presented, the "dream" has been and will always be simply getting something for nothing. Personal greed is and always will be the lever. Greed resides within us all but not all of us interact with it.

What was this encouragement? It was, is and always will be nothing more than someone validating what we already believe.

A democratic republic cannot survive without self-responsibility in the majority of its citizens; the crumbling of our society and those before it should be proof enough. No society/empire fails because of money problems. They failed because the collective citizenry began to believe absurdities.

As Voltaire warned us: "Those who can get you to believe absurdities can get you to commit atrocities." Believe is the operative word. It requires that a choice be made. What is the absurdity we have chosen to believe since 1913? To what atrocity has it led?

If, instead of passively accepting bailouts and government-enforced charity, every voting age adult wrote or called his representatives and made it clear that the representative would lose his/her vote if they supported any legislation of this sort, and that he/she would actively organize and support tax revolts in their community, the outcome we are facing today would be different. Better yet, if every working age person had refused the debt trap, things would be radically different.

It is widely known that legislation is passed without being read, that our representatives often do not know on what they are voting but are told how they are going to vote. Let's face it, government is now combat ineffective. What is our response?

Yes, we have a right to be angry but only at ourselves. Every citizenry gets the government it deserves.

Well said, Harun. Pondering that, I am not angry, but I am afraid for the citizenry and the Republic; for we have the government we deserve, and it is heading off the cliff of insolvency. The citizenry is still in denial, holding fast to the fantasy that their government can magically print trillions of dollars to fund their private entitlements, as well squander additional trillions backstopping $13 trillion in evaporated bad bets and pay for a global empire to boot.

Denial, fear and anger will not take us forward, of that we can be sure.

As an endnote, here is correspondent Dave E.'s commentary on the prevalence of denial:

Now that "consumers" are played out (and played), the government is picking up where consumers left off, proposing outrageously irresponsible policies, such as the "health care" sham being shoved down our throats, which will neither lower health care costs nor increase health care availability, but will fiscally encumber the government, the taxpayers and businesses with the additional costs.

Furthermore, all this talk about “green shoots,” “recovery,” “stimulus,” and so forth is j ust a propaganda to help keep the game going a little longer by encouraging consumers to buy houses and automobiles, the two cornerstones of our consumer economy.

What perplexes me is how the powers-that-be seem to believe that the exponential growth con game can continue forever. It’s as if their insatiable greed has trumped their own powers of reason. Or maybe, as does occur, they have been bamboozled by their own propaganda!

And speaking of denial, I recently returned from a three week driving trip covering 3,800 miles. What amazed me more than anything was the "denial" evident in the other people on the road. People were driving huge, gas guzzling vehicles, many towing huge, gas guzzling "toys," such as boats and trailers containing other vehicles! They were paying exorbitant prices for hotel rooms, restaurant meals and attractions. I got the sense that people had a careless disregard for the future, as if they were partying with reckless abandon today because tomorrow looks too bleak to contemplate, as if ignoring the fiscal realities will somehow make them go away.

If denial precedes fear and anger, then we have a long way to go.


Excellent quotes submitted by readers:

from Kenneth R:

"Every effort under compulsion demands a sacrifice of life energy."
– Nikola Tesla, quoted in Waking Up: Freeing Ourselves from Work

from Angry Saver:

"In a time of drastic change it is the learners who inherit the future. The learned usually find themselves equipped to live in a world that no longer exists."
Eric Hoffer


If you want more troubling/revolutionary/annoying analysis, please read Free eBook now available: HTML version: Survival+: Structuring Prosperity for Yourself and the Nation (PDF version (111 pages): Survival+)

"Your book is truly a revolutionary act." Kenneth R.

Of Two Minds is now available via Kindle: Of Two Minds blog-Kindle

Thank you, Barney S. ($15), for your much-appreciated generous donation to this site. I am greatly honored by your support and readership.

Thank you, Constantine & Co. ($40), for your outrageously generous donation to this site. I am greatly honored by your support and readership.

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Denial, Fear, Anger: The Real Depression Part I

The mainstream media is doing a great job avoiding the frauds at the heart of this Depression.

Correspondent Steve R. made a number of extremely insightful observations recently on the psychology of our post-bubble culture:

Janet's perspective (on the merits of dumpster-diving: The Fluttering Pulse of Entitlement Nation) helps adjust to the new austerity easier than most. The undercurrent of anger may reflect a general feeling of betrayal by the system.

I believe the entitlement mindset was/is a societal attitude actively encouraged by the media, government and big business. "Flip this house" TV shows? NINJA loans for anyone breathing? Bush espousing greater participation in the New Debt-Slave/Ownership Society? Greenspan hawking option ARMs?

Now that the promised dream is crumbling, people are justifiably angry for behaving as they were encouraged to but effectively being duped and punished by the system. Sure it was mostly technically legal - another big problem with the system. The incentives do not reward honorable behavior and personal responsibility (quite the opposite it seems).

A society perceived to be based upon trickery, deceit, obfuscation by legal fine-print and rewarding failure of the biggest/most connected may create a population of angry, skeptical people.(emphasis added, CHS)

Not a good recipe for growth, cooperation, innovation or progress.

Thank you, Steve, for saying what no MSM pundit dares say. Yes, it was all "too good to be true," but we as a nation have witnessed our top "leaders" espouse the charade and actively encourage the citizenry to join in the fraud.

Steve also completely nails the true nature of the U.S. legal system, which I characterized in my last entry as an induced state of destructively profitable mental illness. I do not say this lightly. The entire U.S. legal system is a form of induced mental illness, an insane asylum in which simulacra of "justice" mask the most blatant chicanery, fraud and injustice: thieves at the highest levels not just escape prosecution but are rewarded, and contracts too opaque to be understood by anyone but the embezzlers who wrote them (that is, the vast majority of derivatives such as complex credit default swaps, currency swaps, mortgage-backes securities, etc.) are not just "legal" but applauded by The Powers That Be as "financial innovations" to be celebrated.

Meanwhile, "legal" drugs like alocohol and nicotine kill hundreds of thousands, while essentially harmless marijuana (no proven deaths due to overdose, ever, and less than a dozen "maybe" cases of accidental deaths within the past three decades) continues to be "illegal" and thus enables a drug-prison-police-state gulag.

Ask any experienced emergency room physician what is the chief cause of the mayhem they attempt to repair--shootings, stabbings, child abuse, auto "accidents", spousal beatings, and on and on and on, and the answer will always be alcohol.

Consider this report from physician "Ishabaka":

I truly believe that if we wanted to pick out one substance American citizens could use to get high, we would ban tobacco and alcohol, and legalize marijuana. In my entire medical career I have seen one marijuana user who was ill from his use of the drug - a very heavy smoker who got a case of moderate bronchitis. Virtually every shift I worked in the E.R. I would see people dead or dying from the effects of tobacco, drinking, or trauma suffered while drunk (it is a popular misconception that alcohol intoxication only causes auto accidents. ALL trauma, from burns to tiger bites (I've seen one - the patient was drunk) tend be be alcohol related in adults, and most child abuse tends to be incurred by alcohol intoxicated adults.

As to the "hard drugs" - cocaine, heroin, amphetamines - I have seen some patients who were pretty sick from them, but a tiny amount compared to alcohol and tobacco, and NO deaths.

The tiger bite illustrates a large part of what is wrong with this country. My patient, an adult woman, decided to give a sandwich to a tiger at the Jacksonville zoo. She had to climb a concrete wall, and cross a moat to reach the tiger cage. Her blood alcohol was 240 (80 is the legal limit for driving under the influence in Florida). She reached in the cage bars and gave the tiger the sandwich - and it took it, and didn't molest her until she tried to pet it. It then clamped down on her forearm. I have never seen such an X-ray of a forearm, it was truly awesome. It looked like someone had taken a sledge hammer to the bones of her forearm. Luckily, the tiger did not remove any flesh from the forearm.

I called in a good hand surgeon, who operated on the woman, and obtained a surprisingly good outcome (although of course, not perfect). A year later there was an article in "The Florida Times Union" about how the woman was suing the zoo for failing to adequately protect her from the tiger. Charles, even if you win in civil court in such a suit, your legal costs average about $50,000. Fifty grand to defend oneself against a bogus lawsuit, $73,000 grand to collect the money you are owed by insurance companies for work you have done, ten million for the salary of the C.E.O. of a drug company who has never given a sick patient one of his/her pills, $7,800 dollars for an MRI you don't need but order to "cover your ass" against a malpractice suit....

Thank you, Ishabaka, for this eye-openingly honest commentary.

Though I know that the vast majority of attorneys, doctors, nurses, prosecutors, public defenders, insurance agents and financial advisors are doing their best for their clients and patients in a deeply troubled system, I rest my case on a structural basis: the U.S. legal system has virtually nothing to do with "justice" and everything to do with generating immense profits for legal firms (how about all those "legal" tax shelters for the Plutocracy? Lucrative is the operative word), their unethical "clients" and a host of Elites living off legalized (or the operative equivalent) fraud and embezzlement.

This system can only be described as an induced state of destructively profitable mental illness and its true nature--pillaging the innocent, rewarding the guilty (as long as they belong to a protected Elite), staging sham "show trials" as per the Nazi and Communist playbook on propaganda (One Bernie Madoff goes down and 10,000 lesser criminals of the same ilk go scott-free)--destroys the trust of the citizenry in their government and "leaders" (barf)--for good reason.

Yes, yes, you can still get some modicum of "justice" and healthcare in the U.S. if you have either money or luck (preferably both), but beneath this superficial "normalcy" is a stupendously profitable state of induced mental illness which establishes a "need" for a million attorneys, a drug-"crimes"-gulag and a police-state infrastructure of helicopters (have to locate all that horribly lethal pot), prosecutors, drug squads, and the rest of a $100 billion a year rathole "war on drugs" (street drugs keep getting cheaper, so please don't announce for the 1,000th time that "we're close to winning the war on drugs") and a $2 trillion rathole of sick-care fobbed off as "healthcare" to those fortunate enough to receive any attention outside an emergency room.

(For the record, I consume alcohol but not marijuana, but the facts are clear and undeniable except if you're in a state of profitable induced insanity: the "illegal" drug is far and away safer than the "legal" drugs.)

Is it any wonder the citizenry is simmering beneath the surface? The "finest, most innovative financial system," the "finest, most innovative healthcare system" and the "finest judicial system" are all frauds, protecting and enriching elites at the expense of the general public even as they present a simulacrum for mass consumption (check out all those "cops and docs" TV programs).

The self-destruction of the nation is certainly benefitting some at the expense of the many.


Excellent quotes submitted by readers:

from Kenneth R:

"Every effort under compulsion demands a sacrifice of life energy."
– Nikola Tesla, quoted in Waking Up: Freeing Ourselves from Work

from Angry Saver:

"In a time of drastic change it is the learners who inherit the future. The learned usually find themselves equipped to live in a world that no longer exists."
Eric Hoffer

If you want more troubling/revolutionary/annoying analysis, please read Free eBook now available: HTML version: Survival+: Structuring Prosperity for Yourself and the Nation (PDF version (111 pages): Survival+)

"Your book is truly a revolutionary act." Kenneth R.

Of Two Minds is now available via Kindle: Of Two Minds blog-Kindle

Thank you, Mitch S. ($25), for your great patience and extremely generous donation to this site. I am greatly honored by your support and readership.

Thank you, Yoni F. ($25), for your most-welcome and generous donation to this site. I am greatly honored by your support and readership.

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Dumpster Diving and Freedom

Two reader commentaries on dumpster-diving reveal much about freedom.

Free eBook now available: HTML version: Survival+: Structuring Prosperity for Yourself and the Nation (PDF version (111 pages): Survival+)

"Your book is truly a revolutionary act." Kenneth R.


Correspondent Rich H. offered this comprehensive account of a lifestyle based on re-use, freecycling, bargain-hunting and "dumpster diving" in the broader sense of making use of cast-off goods:

Almost everything I have is either directly from "dumpster diving" or bought from the money saved by dumpster diving. In my case I'm going to define dumpster diving as not only getting usable items from the garbage but buying real cheap stuff that's usually broken from yard sales or bigger items from classifieds for dirt cheap because they were broken. I've never taken food from a dumpster though. I've found that gardening and buying/bartering from local farms is better for me.

In many ways I would not be where I am today if not for dumpster diving. When I was a kid I would go to the town dump and pull out bikes, radios, TVs, lawn mowers or whatever I wanted. I learned how to fix and repair anything.

I would sneak into the dump after hours and quietly pull out what I wanted before they came and covered it with dirt. If the items were too big to carry home on my bike I would stash them in the woods and come back for them with the garden tractor and cart. We lived about 2 miles from the dump. Lucky for me an abandoned railroad bed ran from near my house to near the dump.

How does this relate to how I live today? I'm 50 years old now and I still get what I can from dumpsters behind stores and broken stuff from family, friends and freecycle.

I never made a whole lot of money doing computer consulting(hardware and software). I took in a lot of money but then the taxes would eat up 50% of it. So I 'opted out' and stayed home with the kids while my wife went to work at a local bank. But even so we are able to live a lifestyle that would take 2 to 3 times what we make now.

Here's some examples of how I've saved money:

1. All our computer equipment - laptops, printers, etc. are hand me downs or from freecycle or literally plucked from the garbage cans and dumpsters of businesses nearby.

2. Every car I've owned I bought for cheap, fixed up, drove for a few years and then sold for more than I had in it. So I drive for free. My latest car is a $300 Civic that I put $300 of parts into. Now I'm driving it around and getting 50mpg to boot. Compare that to my neighbors that spend $500/month for a car lease or loan payment plus $150/month for gas.

3. I made my living doing basically what I learned from dumpster diving. Taking some process that's broken and fixing it. In fact my first job - computer technician at IBM - was a direct result of learning electronics in the process of repairing broken electronic stuff from the dump. I then saved the money I made during one year of employment at IBM to pay for my 4 years at college where I learned programming.

4. Almost all our furniture is either picked up from the curb or paid next to nothing for it at yard sales.

5. Since I never bought $5,000 computer systems or $20k, $30k, or $40k cars I saved all that money in the bank.

6. That money I saved was used to build a nice zero-energy house. We have no utility bills and no mortgage. A good investment that's way better than any other "investment" out there (that I understand). And compare this to my neighbors that pay $2k to $3k/month for mortgage and $600/month for electric and heating oil.

7.A local organic veggie farm is more than willing to pay me with food for fixing their farm equipment.

Whenever I put something back into service I got from dumpster diving I think how much money I would have had to make before taxes just to afford to buy it new. It's great knowing that, for example, my free laptop and printer did not generate any money for the government by me putting it back into service instead of going to a landfill.

So, where would I be if not for dumpster diving? It's hard to tell. But probably not where I would like to be.

For me dumpster diving is a way of life. Living off the crumbs thrown out by the rest of the people who buy new stuff.

Thank you, Rich, for this inspiring account of a low-cost/low-impact life free from debt. The word "freedom" is usually employed in a political context of civil liberties and human rights--yet if we as a nation have slipped into a debt-serfdom in which all our time and energy is expended in making payments on all that debt (mortgage, auto/truck loans, credit cards, student loans, back taxes, etc.), then exactly what measure of "freedom" is left to us?

The credit/debt machine and the State (all government) both prosper off what I calltransactional churn--the constant purchasing of new goods and services which can be taxed and which require credit transactions which then generate enormous fees. Buying used goods with cash eliminates all transactional churn and truly "starves the Beast"--in this case, two sides of the same Power Elite coin: the State and the financial Plutocracy.

As I discuss in Survival+: Structuring Prosperity for Yourself and the Nation, this life of debt-serfdom is presented as "The American Dream," a life of fulfillment and happiness. Yet if this was true, why are so many people living this life not just unfulfilled but miserable, frightened, filled with anger/rage, and doped up on drugs legal and illegal?

Perhaps the "Dream" was all just about raking in immense profits, and not at all about personal fulfillment and happiness; maybe the "Dream" is simply a well-cloaked nightmare.

Correspondent Caroline M. provides a window into the structural obstacles our legal and regulatory systems create for any semi-formal attempts to freecycle/freegan on a larger-than-individual scale:

Janet's writing on dumpster diving made me think of my time as a VISTA volunteer at a food bank. One project was trying to get the restaurants to donate that food to the food bank rather than throwing it in the dumpster. The restaurants were concerned over liability, but also they didn't want a truck with the food bank logo on it pulling up to their back door. They were afraid people would think they were getting instead of giving.

The food bank was working on a hold-harmless agreement form and was going to offer an unpainted truck. The truck had to pass health dept standards and they were still working on that when my year was up, so I don't know if they ever got the project off the ground.

We do manage to tie ourselves in knots, don't we?

Thank you, Caroline: and yes, we do. In other words, it's "cheaper" in a supremely litigious society to insist on taking perfectly edible food and other consumables to the landfill than to take on the risks of lawsuits and the regulatory burdens of recovering and distributing the goods.

Perhaps our legal system is not so much a system of justice but rather an induced state of destructively profitable mental illness.


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