Thursday, November 29, 2012

9/11 the Mossad Connection Details, Names, "Dancing Israeli" Positively ID'd in Towers on Day Before


The Rumor Mill News Reading Room 

9/11 the Mossad Connection Details, Names, "Dancing Israeli" Positively ID'd in Towers on Day Before
Posted By: Steve [Send E-Mail]
Date: Thursday, 29-Nov-2012 13:09:18


Daily Paul Liberty Forum
http://12160.info/page/9-11-the-mossad-connection-details-names-dancing-israeli-positive
The newly popular "9/11 Conspiracy Solved: Names, Connections, & Details Exposed!" suffers from one major deficiency: it misses the Mossad connection and Israel's long-standing desire to remake the map of the Middle East starting with the destruction of Iraq. Now comes Ryan Dawson who in great detail and with thorough research fills this gap. Dawson shows that one of the Kurzberg brothers, Mossad agents who have become known as two of the "dancing Israelis" who were arrested and found to have explosives, false passports, and large amounts of cash on their persons, was positively identified as having been in the North Tower on the day before 9/11.
Iraq and especially areas like Falluja now suffer catastrophic rates of birth deformities due to the use of depleted uranium ammunition, 50% or higher in Falluja. Iraq is a destroyed, helpless society whose squabbling factions can now never oppose Israeli regional ambitions.
The goal of dividing Iraq into mini-states has been long articulated by Israeli Neocons. Israeli intellectual Oded Yinon wrote in as far back as 1980, in the influential paper "A Strategy for Israel for the 1980s":
"In Iraq, a division into provinces along ethnic/religious lines as in Syria during Ottoman times is possible. So, three (or more) states will exist around the three major cities: Basra, Baghdad and Mosul, and Shi'ite areas in the south will separate from the Sunni and Kurdish north." - Oded Yinon, in "A Strategy for Israel for the 1980s"
And in a paper written in 1996 for Israeli Prime Minister Benjamin Netanyahu, the Bush administration's prime architects of the Iraq war, Douglas Feith and Richard Perle, wrote:
"Israel can shape its strategic environment, in cooperation with Turkey and Jordan, by weakening, containing, and even rolling back Syria. This effort can focus on removing Saddam Hussein from power in Iraq — an important Israeli strategic objective in its own right — as a means of foiling Syria’s regional ambitions." - "A Clean Break: A New Strategy for Securing the Realm"
Most notable of course is former Director of Studies at US Army War College, Dr. Alan Sabrosky, who has gone on record stating that an event of the magnitude and risk of 9/11 could only have been driven by great geopolitical ambition, and that when the question is asked "qui bono," who benefits?, the answer comes up Israel. Here Sabrosky differs with "9/11 Conspiracy Solved: Names, Connections, & Details Exposed!" which says Afghanistan's opium crop was a key reason for the false flag. At $5 billion per year, the value of this business is a pittance when that much is spent for every two weeks of US military operations.
Sabrosky argues that Saddam was never a threat to the United States, but he was certainly a threat to Israel, who had already launched numerous SCUDs into Israel during Gulf War I.
Since Feith's and Perle's words "removing Saddam Hussein from power" could clearly not have referred to Israel doing the "removing," since it lacks the major land army to do so, they could have had only one other land army in mind which could: the United States. This would require an event at which the Israelis have already proven themselves proficient, a false flag attack, just as the USS Liberty was designed to draw the US into war with Egypt.
The Dawson documentary is posted at the highly regarded Information Clearing House website, whose editor, says Dr. Paul Craig Roberts, is a man "who cannot be intimidated."
"Ryan Dawson is clearly stepping into some very dangerous territory here, and I really commend both his courage and his talent. I urge every one of you to take the time to watch this movie." -The Saker
http://12160.info/page/9-11-the-mossad-connection-details-names-dancing-israeli-positive

There ARE Honest, Law-Respecting Federal Judges!


There ARE Honest, Law-Respecting Federal Judges!

“The IRS was attempting to harass an American citizen who had established that no tax liability existed.”


The IRS headquarters in New Carrollton, Maryland is a government building  that, despite being constructed with public funds, contains art referring to elite secret societies. More importantly, the art conveys a strange message about the U.S. Constitution, and the American people in general.

CtC WARRIOR* NATHAN ANDERSON introduces us to one of these good souls-- Judge Dale S. Fischer of the United States District Court for the Central District of California. On October 10, and then again on November 6, Judge Fischer stood up and stood out from the pack. Breaking a long and darkly-tarnished record of precedents by her colleagues on the bench, Judge Fischer firmly quashed a bogus IRS summons aimed at Nathan, and then denied a subsequent government Motion for Reconsideration.

* CtC refers to “Cracking the Code”, a book by Peter Hendrickson exposing the truth about the federal income tax.

The summons had demanded bank records in an apparent fishing expedition intended to secure evidence of receipts which would have been gratuitously used as a pretext for asserting that Nathan had received "income". Nathan would then have been put to the trouble of rebutting baseless allegations of corresponding tax liabilities.

Judge Fischer's rulings are significant because these summonses have previously been routinely upheld by federal judges, who all-too-often are mere enablers of IRS and DOJ bad behavior. In a departure from that corrupt norm, Judge Fischer recognized that her responsibility is to the law, rather than to the state.

The rulings are ALSO significant, and much more so, because in and by her rulings, Judge Fischer recognizes that intrusive efforts like the one attempted by the government against Nathan must be in pursuit of a lawful purpose-- not to discover if a valid basis for such intrusions exists. That is, intrusive, privacy-violating efforts like this can only be permitted in pursuit of an end for which a legitimate basis has already been established.

The purpose alleged here was the collection of tax liabilities. Absent proof that such liabilities had been previously established and assessed, the effort to submit someone's records to invasion and scrutiny is illegitimate and unenforceable.

Here, the IRS was attempting to harass a CtC-educated American who had established that no liability existed. Thus, there could be no lawful purpose to the summons, and thus, despite being specifically challenged to do so by the judge, the agency was unable to produce any evidence of assessed liability. The best the DOJ and its IRS client could do was the revealingly desperate argument that since the agency isn't allowed to pursue collections activities in the absence of an assessment, and WAS pursuing such activities, the judge should just take it for granted that there must be an assessment somewhere...

FINALLY, THE RULINGS IN THIS CASE are ESPECIALLY significant because among the alleged (but ultimately non-existent) "assessments" cited as the basis for the summons was one for 2004:Nathan, a good and long-time CtC warrior, had filed an educated return and claim for complete refund of everything withheld in 2004, which refu"> http://losthorizons.com/MidEditionUpdate/NARulingExcerpt.jpg

Nathan, a good and long-time CtC warrior, had filed an educated return and claim for complete refund of everything withheld in 2004, which refund he duly received-- seven years ago. (Nathan has also received a complete refund for 2002 on an amended return filed after this 2004 victory, and he and his wife have received other subsequent state and federal victories.) Anyone who has been harassed with bogus IRS threat notices about "changed accounts" and other nonsense, or who has been wearied with ever-more absurd warnings from anyone to the effect that, "All these refunds are just slipping through the cracks. Eventually they'll get noticed and "taken care of"!" will find this plain evidence of the emptiness of such nonsense of great interest.

-Dr. Martin Luther King, Jr.

http://losthorizons.com/MidEditionUpdate.htm#7lign="center" class="MsoNormal" style="text-align: center;"> "Cowardice asks the question - is it safe? Expediency asks the question - is it politic? Vanity asks the question - is it popular?
But conscience asks the question - is it right? And there comes a time when one must take a position that is neither safe, nor politic, nor popular; but one must take it because it is right."

-Dr. Martin Luther King, Jr.


To read more about the occult symbolism associated with the IRS headquarters in New Carrollton, MD:


_________________________________________________________________________________

http://www.losthorizons.com/art/webfront.jpg

For the 64 years of its existence, the U. S. Internal Revenue Code has been ridiculed, feared and despised by virtually everyone.  And why not?  As presented by the Internal Revenue Service, the code appears illogical, inconsistent and incomprehensible.  As presented, the code defies practically the entire Bill of Rights– requiring citizens to testify against themselves, allowing searches and seizures without warrants, levying fines and penalties without trials and imposing a tax on the basic right to earn a living.  As presented, the IRC would appear to turn everything we all thought we had learned in grade school English and Civics on its head.

Is it possible that we all just misunderstood those simple lessons?  Maybe.  But researcher, analyst and scholar Peter E. Hendrickson believes that after Cracking the Code, you’ll agree that what has been misunderstood is the 3,413,780 word monstrosity itself– and how, and to whom, it applies.

Hendrickson delves deep into the history, statutes and case law behind the Code to reveal its startling and liberating secrets; and unless you live in a cave, you need to know what he’s uncovered.
Once you’ve finished “Cracking the Code”, the tax laws will never mean the same thing to you, or your bank account, again!


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Interview with POOF at American Kabuki blog


The Rumor Mill News Reading Room 
Interview with POOF at American Kabuki blog
Posted By: hobie [Send E-Mail]
Date: Thursday, 29-Nov-2012 17:10:18

Hi, Folks -
Thanks to the several Readers who sent me e-mails about this. :)
Posted at American Kabuki blog is an audio-only video of an interview with Poof from October 15.
In case you're wondering, yes, that's Poof, and yes, he did give permission for the audio to be posted. :)
Brief portion of the text intro to the video:
Poof asked me to delay posting this video because some groundwork for the new financial system was not yet complete, which is why its being released 6 weeks after the fact. Poof informed me Tuesday that I could post this Thursday as the protocols would be completed. I apologize for the delay. I thought it better to delay this video than cause complications in implementing the new financial system which will benefit all.
BRIAN INTERVIEWS POOF
http://americankabuki.blogspot.com/2012/11/brian-interviews-poof.htmlBlessings, all.
--hobie

American Patriots and Guns


American Patriots and Guns

All Patriots Are Obligated to Be Armed and Ready

By Mark Alexander · November 29, 2012   

"The right of the citizens to keep and bear arms has justly been considered as the palladium of the liberties of a republic." --Joseph Story
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On the most recent "Black Friday," the day after Thanksgiving, which has become the biggest commercial sales day of the year, despite the continuing economic decline, there were record sales in one notable product category: Guns.
According to Stephen Fischer, director of the FBI's National Instant Criminal Background Check System, "NICS experienced its highest number of transactions processed since system inception [in 1998], with 154,873, which is nearly 20 percent over the 129,166 processed on Black Friday 2011." This year's total checks will undoubtedly beat last year's record of 16.4 million.
In fact, the top 10 record gun sales days have occurred since Barack Obama's election in 2008, and gun ownership has skyrocketed over the last four years. According to a worldwide survey conducted the year before Obama's election, though the United States had only 5% of the world's population, Americans owned 50% of the world's guns. Of course, unlike virtually every other nation, Americans are ensured the incontrovertible right to arm themselves.
The current estimate of legally and privately held guns in the U.S. is more than 250 million (the average gun-owning household having three guns).
With that as a backdrop, I was asked this week if Patriots have an obligation to arm themselves -- to be gun owners, and be proficient at the use of arms. I thought at first the question was rhetorical, but after some consideration, I realize that there are millions of grassroots Patriots who are NOT among the 60 million plus Patriots who are already law-abiding gun owners.
Apparently, the question needs to be addressed, as the answer may not be as obvious to some folks as it should be. By way of responding to this question, let me first briefly reiterate the historical and enduring case for gun ownership, which is as relevant today and tomorrow as it was at the dawn of our national founding.
There are two foundational tenets of Essential Liberty that all American Patriots must understand and embrace in order to sustain Liberty and extend it to the next generation.
First, it is "self-evident" that Liberty is an "unalienable right," innately assured as "endowed by our Creator." In other words, it is not awarded by men or government; it is the birthright of all people.
Second, as history records countless examples of men using the power of government to arbitrarily revoke Liberty and invoke tyranny, our Founders understood that, in the words of John Adams, "liberty must at all hazards be supported." Adams continued, "We have a right to it, derived from our Maker. But if we had not, our fathers have earned and bought it for us, at the expense of their ease, their estates, their pleasure, and their blood."
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Thus, all American Patriots today, those imbued with the spirit of Liberty that has motivated Patriots since 1776, must be prepared to support and defend both individual and corporate Liberty, to secure the Rule of Law over the rule of men.
Of the ability to defend Liberty, James Madison wrote, "The ultimate authority ... resides in the people alone. ... The advantage of being armed, which the Americans possess over the people of almost every other nation ... forms a barrier against the enterprises of ambition." (Federalist No. 46)
To ensure that advantage, our Founders enumerated a constitutional prohibition on government interference with that barrier, the Second Amendment, affirming, "the right of the people to keep and bear Arms shall not be infringed."
In his exhaustive "Commentaries on the Constitution," Madison's Supreme Court Justice, Joseph Story, wrote, "The right of the citizens to keep and bear arms has justly been considered as the palladium of the liberties of a republic; since it offers a strong moral check against the usurpation and arbitrary power of rulers; and will generally, even if these are successful in the first instance, enable the people to resist and triumph over them."
In other words, the Second Amendment is not about "the tradition of hunting" as Barack Obama claimed recently, unless he was referring to hunting those who infringe on the inalienable rights of man. Of course, Liberty is the antithesis of statism, which is why Obama and his socialist Democrat cadres are endeavoring to undermine the Second Amendment. (Obama's failed "Fast and Furious" gun control is a fine example of that endeavor.)
Obama has asserted erroneously, "The vast majority of Americans would like to see serious gun control, [but] it doesn't pass because there is this huge disconnect between what people think and what legislators think and are willing to act upon." His disdain for grassroots gun owners was summed up in his unguarded remarks to campaign donors in 2008, when he said that they "cling to guns or religion or antipathy to people who aren't like them or anti-immigrant sentiment or anti-trade sentiment as a way to explain their frustrations."
Thus, I expect to see new second term Obama administration proposals endeavoring to implement incremental encroachments on the Second Amendment. However, Obama is set to reconvene March 18th-28th in order to pass the final version of the treaty that will be sent to the Senate for ratification. Make no mistake, they will ultimately register, ban and CONFISCATE firearms owned by private citizens. Not long ago, Obama told Sarah Brady from the anti-gun Brady wnership in the U.S., with the stroke of a pen, it could implement severe gun restrictions and even confiscations -- an end run on the Second Amendment that would provide political cover for gun-grabbing Leftists in the Senate and House.
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Indeed, as summed up by Sen. Rand Paul, "The day after his re-election, Obama's UN delegation voted for a renewed effort to pass the Small Arms Treaty. This effort by globalists to undermine our Constitution is set to reconvene March 18th-28th in order to pass the final version of the treaty that will be sent to the Senate for ratification. Make no mistake, they will ultimately register, ban and CONFISCATE firearms owned by private citizens. Not long ago, Obama told Sarah Brady from the anti-gun Brady Campaign, 'I just want you to know that we are working on [gun control]. We have to go through a few processes, but under the radar.'"
In regard to gun confiscation, I recommend that Obama pick up an American History text, one that has not been "revised" by teacher or librarian unions, and read about the first American Revolution. He will find that it commenced with "the shot heard round the world," as immortalized by poet Ralph Waldo Emerson -- a shot fired by Patriots at the Massachusetts governor's enforcers, who were sent to Concord with orders to confiscate and destroy militia arms. There is a subtle lesson there...
(Sidebar: On the subject of revisions, next week Obama's UN delegation will meet with the UN agency overseeing global telecommunications, the International Telecommunications Union, to revise Internet regulations.)
Clearly the surge in gun sales and ownership over the last four years has been driven by Obama's agenda to implement new "gun control" measures, which are, of course, not about guns but about control, as tragically demonstrated by the appalling record of genocide meted out by tyrants toward those who had no means of self defense.
According to gun-rights expert, Professor Raymond Kessler, J.D., "In truth, attempts to regulate the civilian possession of firearms have five political functions. They increase citizen reliance on government and tolerance of increased police powers and abuse; help prevent opposition to the government; facilitate repressive action by government and its allies; lessen the pressure for major or radical reform; and can be selectively enforced against those perceived to be a threat to government."
So, given that Liberty must be supported and defended at all hazards, and given the current assault on gun ownership, consider again the question, "Do Patriots have an obligation to arm themselves -- to be gun owners, and be proficient at the use of arms?"
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The answer is, emphatically and absolutely, YES. Moreover, I would argue that it is the responsibility of all gun-owning Patriots to educate their like-minded family and friends about the overarching rationale for gun ownership -- the ability to defend Liberty -- and to encourage them to become responsible gun owners.
I know many Patriots who, since Obama's election, have become first-time gun owners. The fact that 49 states authorize carry permits, 41 of those being "shall issue" states providing on-demand concealed-carry permits to law-abiding citizens, has encouraged that trend. The lone state denying the right to carry is, naturally, Obama's state of residence, Illinois.
In recent years, I've proudly encouraged and assisted dozens of Patriot friends to become responsible gun owners. One of those "new" gun owners was my wife, who, along with six other women friends, took the required training and now has her carry permit. Each of my children is also a gun owner. (My oldest son, an Air Force Cadet, is an outstanding shooter. The weapons of my two minor children only come out under strict supervision, but my 13-year-old already shoots a very tight pattern at 100 meters with his M-4.)
One of my wife's friends said that when some of her liberal family members came to visit recently (one of those tragic "mixed families"), they got wind that she now owns not one, but three guns. Her brother inquired, "Why would anyone own three guns?" Without missing a beat, she replied, "Because I can!" (That has got to rank first among the most cutting and concise rebuttals I have ever heard.)
And on that note, three other friends, who grew up in former Soviet satellite states, told me that after becoming U.S. citizens (the old fashioned way -- legally), the first thing they did was obtain their right-to-carry permits. They each have a fuller appreciation for that right.
So, how do dedicated Patriots who are not familiar with firearms make the leap to gun ownership and proficiency?
I received a letter this week from a reader among our Patriot ranks, who included a brief history of how his whole family made the transition from non-gun owners to never leaving home without one. I have included a brief excerpt of his story in order that it might help others make that transition.
He writes, "Growing up in Chicago, where guns were outlawed and only outlaws had guns, when the topic of guns came up, my parents replied, 'Only gangsters and hunters carry guns -- and we are neither.'" Given this prohibitive backdrop, I invite you to read the rest of his Second Amendment testimony.
For the record, when it comes to Liberty, I would much prefer constitutional restoration over insurrection -- if the former is achievable. (I've been around a few revolutions in Africa and the Middle East, so I'm well aware of the violence that accompanies the latter course.) But as current day American Patriots, we all have an obligation to not only stand ready to defend our family and property, but moreover to defend Liberty.
I'll leave you, then, with these words from Thomas Jefferson on both the individual right of self-defense, and the corporate responsibility to uphold Liberty.
Quoting 18th-century Italian jurist and philosopher Cesare Beccaria in his "Commonplace Book," Jefferson wrote, "Laws that forbid the carrying of arms ... disarm only those who are neither inclined nor determined to commit crimes. Such laws make things worse for the assaulted and better for the assailants; they serve rather to encourage than to prevent homicides, for an unarmed man may be attacked with greater confidence than an armed man."
Regarding our corporate obligation in defense of Liberty, Jefferson wrote, "What country can preserve its liberties, if their rulers are not warned from time to time that their people preserve the spirit of resistance? Let them take arms."

Archangel Gabriel - Ease, Imagination and Joy

http://www.youtube.com/watch?v=XkYYXoiuVko&feature=plcp

Archangel Gabriel through Shelley Young
Ease, Imagination and Joy - Channeled November 25-2012

visit this channel on our website: http://wp.me/p1x2W5-gK

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Reality! See the irony of this?


A union boss walks into a bar next door to the factory and is about to
order a drink to celebrate Obama’s victory when he sees a guy close by
wearing a Romney for President button and two beers in front of him.
He doesn't have to be an Einstein to know that this guy is a
Republican. So, he shouts over to the bartender so loudly that
everyone can hear, "Drinks for everyone in here, bartender, but not
for the Republican."

Soon after the drinks have been handed out, the Republican gives him a
big smile, waves at him, then says, "Thank you!" in an equally loud
voice. This infuriates the union boss.

So the union boss once again loudly orders drinks for everyone except
the Republican. As before, this does not seem to bother the
Republican. He continues to smile, and again yells, "Thank you!"

So just to make his point one more time, the union boss once again
loudly orders drinks for everyone except the Republican. But, as
before, this does not seem to bother the Republican. He continues to
smile, and again yells, "Thank you!"

Frustrated, the union boss asks the bartender, "What the hell is the
matter with that Republican? I've ordered three rounds of drinks for
everyone in the bar but him, and all the silly ass does is smile and
thank me. Is he nuts?"

Nope," replies the bartender. "He owns the place."

List of Countries That Have Sent Help to America After Hurricane Sandy


List of Countries That Have Sent Help to America After Hurricane Sandy:

Here's the full list of all of America's friends that have sent assistance to us in our time of need. We need to match their help dollar for dollar whenever a disaster strikes them.

1. ________________

WAKE UP AMERICA

Oklahoma–Sometimes You Have To Copy Things


Subj: The Sovereign State of Oklahoma – Sometimes You Have To Copy Things
I love this state! How can we get ours to be like this? 'Be who you are and say what you feel, because those that matter - don't mind... and those that mind - don't matter.'

Oklahoma–Sometimes You Have To Copy Things

Oklahoma is the only state that Obama did not carry one county in the last [2008] election...

While everyone is focusing on Arizona’s new law, look what Oklahoma has been doing!!!!

An update from Oklahoma:
Oklahoma law passed, 37 to 9, an amendment to place the Ten Commandments on the front entrance to the state capitol. The feds in D.C., along with the ACLU, said it would be a mistake. Hey this is a conservative state, based on Christian values…; HB 1330!

Guess what………. Oklahoma did it anyway.

Oklahoma recently passed a law in the state to incarcerate all illegal immigrants and ship them back to where they came from, unless they want to get a green card and become an American citizen. They all scattered; HB 1804. Hope we didn’t send any of them to your state. This was against the advice of the Federal Government and the ACLU; they said it would be a mistake.

Guess what………. Oklahoma did it anyway.

Recently we passed a law to include DNA samples from any and all illegal’s - to the Oklahoma database - for criminal investigative purposes. Pelosi said it was unconstitutional; SB 1102.

Guess what……… Oklahoma did it anyway.

Several weeks ago, we passed a law declaring Oklahoma as a Sovereign state - not under the Federal Government directives - joining Texas, Montana and Utah as the only states to do so.
More states are likely to follow: Louisiana, Alabama, Georgia, the Carolinas’, Tennessee, Kentucky, Missouri, Arkansas, West Virginia, Mississippi and Florida. Save your confederate money; HJR 1003.
The federal Government has made bold steps to take away our guns. Oklahoma, a week ago, passed a law confirming people in this state have the right to bear arms and transport them in their vehicles. I’m sure that was a set back for the criminals. The Liberals didn’t like it — But ….

Guess what……….. Oklahoma did it anyway.

Just this month, the state has voted and passed a law that ALL drivers’ license exams will be printed in English - only English - and no other language. They have been called racist for doing this, but the fact is, that ALL of the road signs are in English, only. If you want to drive in Oklahoma; you must read and write English. Really simple.
By the way, the Liberals don’t like any of this, either.

Guess what…who cares… Oklahoma is doing it anyway.

“America will never be destroyed from the outside. If we falter and lose our freedoms, it will be because we destroyed ourselves”. – Abraham Lincoln

2nd Amendment in it’s entirety: “A well-regulated Militia being necessary to the security of a free State, the right of the people to keep and bear arms shall not be infringed”.

“We the people are the rightful master of both Congress and the courts, not to overthrow the Constitution, but to overthrow the men who pervert the Constitution”. – Abraham Lincoln

“Even if your on the right track, you’ll get run over if you just sit there”. – Will Rogers

Personal Comment: We have been here since the American Revolution and we will always be here, waiting in the shadows, in the event we are needed. We are U. S. Military Veterans and we love America more than our own lives….

I just had to pass this on—

Dr. Tickle

Source: http://conservativetickler.wordpress.com/category/the-sovereign-state-of-oklahoma/

Ascension Earth 2012 Update


Subject: Ascension Earth 2012

Ascension Earth 2012


SaLuSa Speaks of 2012 Predictions - Mike Quincey 11/28/12

Thousands of Small Banks Will Soon Disappear


The Rumor Mill News Reading Room 

Thousands of Small Banks Will Soon Disappear
Posted By: Jordon [Send E-Mail]
Date: Thursday, 29-Nov-2012 06:34:22

.
Wall Streeters say Obama's second term will be the death knell for small banks.
Do we need to worry about Too Small to Survive?
Now that President Obama has been re-elected, analysts, consultants and dealmakers have turned from whether Dodd-Frank will be repealed to what it means for banks now that it's likely here to stay. The overwhelming conclusion: Thousands of small banks will soon disappear.
Emmett Daly, a Sandler O'Neill dealmaker who specializes in small banks, predicted at an industry conference put on by Mergermarket on Thursday that the number of banks in the U.S. would shrink to a few hundred. There are currently more than 7,000. Bill Egan, head of financial institutions investment banking at Bank of America Merrill Lynch, agreed, but said the weeding out process was likely to take more than a decade.
Indeed, the deal this week to buy bank adviser KBW by larger rival Stifel Financial appeared to be motivated by the belief that more banks would have to make deals. Says Rochdale Securities bank analyst Dick Bove, "It's fairly clear that 50% of the banks in the U.S. need to be recapitalized."
Kamal Mustafa, who heads up bank consulting firm Invictus and is a former Wall Street M&A banker, says it's not just Dodd-Frank. Low interest rates and the Fed's annual stress tests are making it tough for small banks to survive as well. His firm looked at bank profits and capital rules and came to this conclusion: Nearly 2,000 banks need to sell. "There are a large number of banks that are limping toward oblivion," says Mustafa. "Capital requirements have gone up too fast, and rates have gone too low. There's no way out."
Like post offices and small businesses in general, law makers are likely to come to the rescue of small community banks. What's more, at least so far small banks haven't done significantly worse under Dodd-Frank than big banks.
Still, it's probably true that all the rules we have lumped on the banking industry in a good faith effort to make our financial system safer will most likely make it harder for small banks to stick around. The real question is how much we should care.
Canada, afterall, has less than two dozen banks, and by most accounts it's banking system did pretty well in the financial crisis. What's more, the vast majority of lending, something like 90%, in this country is done by the nation's 50 largest banks. So losing nearly 7,000 banks would only cut off credit to 10% of borrowers at most.
Joseph Mason, a finance expert at Louisiana State University, says there's no hard economic evidence to show whether small banks benefit the economy or not. Nonetheless, Mason says he falls into the camp that believes small banks are good for the U.S. He says competition matters. And while small banks only make up a small portion of lending, the types of loans they do, to local businesses that large banks might deny, may matter.
But all this comes at a cost. The Federal Deposit Insurance Corp. has spent tens of billions saving mostly small banks over the past few years. Is it worth it? In the mortgage market there appears to be somewhat of an answer. Home loans are dominated by a few large banks, Wells Fargo and J.P. Morgan, mostly. Small banks have largely been pushed out. The result: Mortgage rates are about one percentage point higher than they would be if we had more competition. Apply that to all mortgages, and that higher interest rate costs consumers about $100 billion a year in extra interest. Not to mention all those who can't actually get refinanced. I'd say that's pretty good evidence that we should figure out a way to keep small banks around.