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2018-07-27 13:32 by Karl Denninger
in Small Business , 95 references
[Comments enabled]  

Look to the right and email me if you're an entrepreneur looking for a no-cloud, no bee-ess, home control system that was designed from the ground up to be fast, nimble, licensed on a flexible basis (e.g. subscription if you wish, perpetual, "per version upgrade", etc) and is ready to rock-n-roll.  More info here: http://homedaemon.net 

First come first serve, rest cry!

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2018-07-11 07:00 by Karl Denninger
in Editorial , 599 references
[Comments enabled]  
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Can you stop the caterwauling already?

Look folks, just cut the crap.  Seriously.  There's nothing legitimate about SCOTUS at the present time.  Nothing.

And no, neither left or right did that to the SCOTUS -- not Bush, not Obama, not Clinton and certainly not Trump.  The SCOTUS did that to itself, and we the people then ratified it -- and it happened a long time ago.

To make the example and underline the point I shall go back to the root of the problem we have today with the Judiciary, with the SCOTUS and with the Federal Government generally: The 17th Amendment, proposed on 5/12/1912 and ratified less than a year later on 4/8/1913.

Following that came Wickard .v. Filburn, 317 US 111, decided in 1942.  That decision was unanimous.

I bring this up because I was sent the following on Kavanaugh, which is a decision he filed a dissent on related to Obamacare, known as Seven-Sky .v. Holder.

Kavanaugh has been "credited" with giving Roberts the idea that he could "recast" Obamacare as a tax, and by doing so providing him the means to "save" Obamacare.  Nonsense.  Kavanaugh argued in his dissent that the Anti-Injunction Act prohibited the court from granting relief and never reached the merits at all.

This is important because, if you remember, Roberts didn't just recast the "penalty" (impermissible) as a tax -- he recast it as a Direct Tax, which is constitutionally impermissible on its face and has been since the founding of the nation except on a capitated basis.

In other words it is Constitutional to lay a $10 per-person direct tax -- but you can't condition or vary it.

There were multiple attempts to lay an income tax and every one was struck down as a violation of the Constitution, leading to the 16th Amendment, which permitted same.  But the 16th Amendment only authorized taxes on income; it did not override the general prohibition on non-capitated direct taxes in the Constitution.

That is, Roberts re-wrote an unconstitutional "penalty" into an Unconstitutional Tax -- a black letter unconstitutional tax that was unconstitutional in 1789 and remains so today -- and yet nobody has done a damned thing about it.

This is, I remind you, despite the Congressional Record from the time of the crafting of the PPACA containing evidence that Congress knew they couldn't define the "penalty" to be a tax as they knew that was a facially-unconstitutional direct tax so they intentionally worded it as a penalty to try to get around that infirmity!

I bring all this up, especially the elements of Wickard .v. Filburn, because if you read the above linked opinion -- not Kavanaugh's dissent but the opinion that was issued -- you will in fact find myriad references to Filburn as controlling precedent.

But Wickard .v. Filburn was nothing less than a complete re-write of the Constitution so as to remove the separation of power between the Federal Government and the States!

The decision held that a farmer who grew a crop for his own internal consumption -- that of his family and his animals on said farm, never entering one grain of same into commerce, was nonetheless subject to federal regulation on how much of said crop he could grow or whether he could grow it at all.

The claim was that because his act of growing same would mean he wouldn't need to buy as much, or none at all, of the same product or something that provided the same benefit (e.g. was food and thus sustained life) that affected interstate commerce.

By this decision the Supreme Court completely tore up the entire Constitution; it rendered literally no subject matter beyond federal regulation.  You can, under this premise, have a federal law passed making it illegal for you to have a toilet in your house with the intended effect of forcing you to go down the street and pay $1 to take a crap each time.  Why?  Because if you have a toilet you will not need to use the public one at $1 for each use as much, or even at all.  Since the pipe (for the water!) might travel in interstate commerce this affects same, and thus federal regulation attaches.

So given that precedent, and that the correct and immediate response to that decision was not taken by the States (specifically, to immediately secede and call up their National Guard units to enforce same until and unless the Constitution was restored as the contract with the States had been breached egregiously and without any possibility of recovery through peaceful means) what do you think was going to happen with Obamacare?

Here lies the problem with Kavanaugh -- and all the rest of these black-robed bastards: They know good and goddamn well the Constitution prohibits nearly everything in Federal Law today and they don't give a shit.

More to the point neither do you so long as the violations are to your liking!  Nowhere is the Federal Government empowered to regulate public schools.  There is no Federal Constitutional right to an education -- of any sort.  Yet there is title after title bearing on exactly this, forcing expense down the states' throats.  The States have constitutional guarantees at the state level for a public educational system but nothing allows federal reach into same.

THE SUPREME COURT DOES NOT HAVE THE POWER TO REWRITE THE CONSTITUTION YET IT ROUTINELY HAS DONE EXACTLY THAT.

The Founders were very specific on creation of a weak federal government and strong states.  They did it for the specific reason that they fully expected and anticipated exactly the sort of schism between the people we have today.  They expected and designed the federalist system so that 13 (now 50) political laboratories would be empowered to each come up with their own set of rules, regulations, taxes and benefits.

The Federal Government's role was to (1) prevent invasion whether by stealth or force (gee, they're doing that today, right?), (2) to prevent states from trying to rig the outcome of their political experiments by laying what amount to tariffs on goods and services crossing state lines and (3) to protect against infringement of individual rights (all of which pre-exist government and are not granted by same) such as the right to speak, the right to freedom of worship, the right to self-defense (thus the Second Amendment) and the various collection of due process rights such as the right to a trial by jury, to confront one's accuser and to be free from searches and seizures except upon issuance of a warrant containing the specifics of probable cause, and strictly limiting what was to be searched for, and where.

To the extent a state wished to enact a tax and spending program that issued welfare they could.  But they couldn't compel any other state to go along with it or pay for it as absolute control of the upper house -- the Senate -- rested in STATE LEGISLATURES.  In other words the people had their proportional representation (in the US House) and the State Legislatures had theirs (in the Senate.)

To pass a federal law, say much less a Constitutional Amendment, you needed concurrence of both.

The 17th Amendment ended that.  The State Legislatures were permanently stripped of the foundation of their power at the Federal Level -- the requirement that they concur through the Senate before any Federal Law could be passed.

Further, let me point out that at the time of Wickard, and indeed continually both before and since, the US Congress could have constrained the power of the US Supreme Court.  Congress has the power to establish tribunals inferior to the Supreme Court (and over which it has appellate jurisdiction), and has (Article I, Sec 8)

But the Constitution also says this in Article 3 Section 2 about Congressional Regulation of the Supremes:

2: In all Cases affecting Ambassadors, other public Ministers and Consuls, and those in which a State shall be Party, the supreme Court shall have original Jurisdiction. In all the other Cases before mentioned, the supreme Court shall have appellate Jurisdiction, both as to Law and Fact, with such Exceptions, and under such Regulations as the Congress shall make.

Congress can control the boundaries of any appeal, for instance.  And while Congress cannot prevent any case in which Original Jurisdiction rests these are a tiny, in fact vanishingly small, percentage of the whole of what the Supreme Court hears.

But it hasn't.

So what about Kavanaugh personally?  Well, he's opined that assault weapon bans are unconstitutional.  He's right -- they are and so are all other federal gun laws except those bearing on interstate commerce.  Laws banning or regulating, including licensing or permitting, the "keeping and bearing" of arms are black-letter unconstitutional.  Period.

But he's also opined that the President is immune from indictment.  Uh, no.  That's not in the Constitution; I know how he reaches that viewpoint but it simply isn't in the enumerated powers and with good reason.  A primary principle of statutory and Constitutional construction is that words that are present mean what they say and those that are omitted cannot be added in; the writers are presumed to have omitted the words you might imagine you'd like to see on purpose.  Indeed the founding principle of this nation is that all are created equal.  One cannot be equal if one is immune from the legal strictures that apply to anyone else as a consequence of being elected or appointed to a political office.  Finally the Constitution is a negative document not just by inference but by actual word in the 10th Amendment; that which is not specifically delegated as a power does not exist at the federal level -- including for federal office holders!

Does Kavanaugh have an excellent intellectual background and ability to reason?  Absolutely.  But is that the test?  It ought not be yet the usual pablum of "obeying the written Constitution" was trotted out by him at the lectern (it is not a podium folks -- learn the difference Mr. President!  You stand on a podium, and you speak behind a lectern!) -- which is an utterly common yet blatant and outrageous lie uttered by all Supreme Court nominees.

When you wind it all up what you have here is a nominated man who has the very same idea of making the Constitution read the way he wants it to that Sotomayer and Kagen have -- along with others before them and plenty of robe-wearers right now.  Nor can you point to Scalia, who once again "found" things that simply never existed.  They simply have a different idea of how they want the Constitution to read.

Yes, it is a fact that actually obeying the dictates of the Constitution means that a huge percentage of the alleged laws on the books -- like 80% of them or more -- simply go "poof" like a fart in a Church.  That's how it's supposed to work.  Nearly the entire federal gun law set, for example, is unconstitutional.  Ditto for the "scheduling" of drugs; Congress knew damn well they had to pass an amendment to ban alcohol.  Alcohol is a drug, and a drug of abuse.  Well?

Then there's Roe.  If you haven't read the actual opinion you should; it has a quite-full exposition on the history of abortion included in it.  It's an extraordinarily well documented piece of judicial reasoning, whether you agree with the conclusion (and its limitations; there was no blanket right to abortion contained in the opinion) or not.  But Roe, in the end, turns on whether you have an individual right to privacy, which the justices found.  Well, if you do and it vests in the Due Process clause of the 14th Amendment, how come it hasn't been applied to anything else?  Why can a private entity collect all manner of private data and sell it to anyone who they want including the government, without a warrant?  Why can the government use a DNA database without a warrant?  Why can the government (and it does, by the way, in many if not all states by now) collect DNA from all newborn children and catalog that?

In short how do you have a constitutional right to privacy if you can't actually enforce it anywhere except in the abortion doctor's office?

Cut the bullshit folks.  Those screaming on both sides of the aisle are simply demanding that the government put its boot on your neck as they want it to, and not as the other side wants.

NOBODY is arguing for a return to the boundaries of the Constitution, never mind that pesky 17th Amendment we can't get rid of without a revolution.

With that said I predict Kavanaugh will be confirmed -- before the election.

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2018-07-05 07:00 by Karl Denninger
in Macro Factors , 320 references
[Comments enabled]  

This man is flat-out nuts.

When are America’s global corporations and Wall Street going to sit down with President Trump and explain to him that his trade war is not with China but with them? The biggest chunk of America’s trade deficit with China is the offshored production of America’s global corporations. When the corporations bring the products that they produce in China to the US consumer market, the products are classified as imports from China.

Six years ago when I was writing The Failure of Laissez Faire Capitalism, I concluded on the evidence that half of US imports from China consist of the offshored production of US corporations. Offshoring is a substantial benefit to US corporations because of much lower labor and compliance costs. Profits, executive bonuses, and shareholders’ capital gains receive a large boost from offshoring. The costs of these benefits for a few fall on the many—the former American employees who formerly had a middle class income and expectations for their children.

He goes on to argue that it's not China's fault -- it is the fault of our corporations, and thus we have to deal with "our" corporations.

Uh huh.

A business exists to make a profit.

Laws define what is legitimate to do in the pursuit of said profit, and what is not.

Millions of Americans lost their jobs because the law allowed their jobs to be offshored to literal slave-labor encampments without consequence.

And it is not just China.  In fact, China is just one of many offenders.

The results are plain. In Kuala Lumpur cranes stretch outward among the gleaming towers in a perpetual construction boom powered by foreign investment. The streets are spotless and well policed, the water is clean, and the politics are relatively stable. Consumers around the world benefit from products like mobile devices, circuit boards, and LED screens.

At the heart of this economic success are migrant workers. From Bangladesh, Nepal, the Philippines, Indonesia, and India, they arrive at Kuala Lumpur International Airport by the scoreful, papers in hand, hoping for a better life. Estimates of the number of foreign workers in Malaysia vary widely, from the government’s count of almost 1.8 million to perhaps twice as many, which would amount to a quarter of the country’s workforce. Migrant-worker advocates estimate one-third of those workers are undocumented.

Malaysia allows and prospers through what amounts to slave labor; in other words, modern-day human trafficking to obtain labor for pennies an hour.

This is nothing new; in fact it's as old as people.  Mexico was once one of the worst in this regard; they didn't give a crap about the health of their slaves or even their longevity; they had access to so many of them that there was no economic incentive to even feed their slaves.  In other words it was cheaper to buy a new slave than feed the one you have.  America's slavery, for all its warts, didn't devolve into that but it wasn't from the "caring" of the slave-owners -- it came from the economics.

Has it really changed?  Nope, nor will it ever except where the law forces it to.

This is why in my book Leverage I pointed out that the only way to deal with this crap and stop it is to apply Wage and Environmental parity tariffs without exception and to ensconce those in law for any firm that wants to do business in the United States, without exception.

PCR says this is the fault of the Fed.  Of course he does -- he doesn't want to deal with the fact that he, personally egged on the offshoring and "free trade" bullshit, never mind his time in advocacy with the Hoover Institution, Georgetown, George Mason University, an associate editor for the Wall Street Journal (which has an unabashed record of promoting so-called "free trade") and, of course, Reagan's "supply side" economics which were little more than a sop to offshoring and exploitation of slavery.  Oh, and let's not forget his advisory role to J.P. Morgan!

It's not like the big banks had anything to do with this, right? smiley

Reagan had the distinction of running enormous deficits during his Presidency, which inflated GDP.  Everyone cheers for GDP increases but nobody in the media, nor Roberts himself, points out that mathematically GDP will always increase by the exact amount all branches of government combined spend in deficit, whether they allegedly issue "bonds" to "fund" that or not.

Nobody issues bonds or takes down a deficit for money they do not immediately use.  If your local district issues a $20 million bond for a school improvement it immediately spends the $20 million.  If they taxed the money from you first the net GDP impact would be zero -- you forfeit the $20 million to the school (which means you don't spend it) and then the school spends it.  $20 million minus $20 million is zero.

But if they can spend it first then they take nothing from you initially and GDP goes up by $20 million.

The problem is that theoretically they must take the $20 million later to pay off the bond but history says they never do. Instead the bond is rolled over and only the interest is paid, so the $20 million appears to be "free" in economic terms and thus GDP continues to go up when they issue the next one too.

It's not true in fact and what's worse is that the "extra money" flying around makes the price of everything go up.  Now if there was no turd-world slave labor there would be a check and balance on this that would come in the form of rapidly-rising wage demands (when you get to the point of being unable to feed yourself why go to work?) and that cuts off the game.

To prevent a replay of this after it happened during Nixon's administration (and interest rates were forced higher in response) PCR and the rest of the "free market" screamers passed law and policy to make it both legal and trivially easy to find a source of slaves to replace those pesky people in America who would otherwise demand more money to keep making both cars and computers.  They are also the same people who insist that illegal Mexicans be allowed to flood the nation to pick oranges, strawberries and roof houses.

It's not that Americans can't do those jobs it's that you can't ask Americans to do so them for $3/hour and expect them to be able to survive.  The price of a house or strawberry package would skyrocket immediately and cut off the unbacked credit issuance.

In other words it's all fraud and PCR knows it.

But this is what passes for "economic wisdom" these days, never mind "reporting."

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2018-06-28 09:49 by Karl Denninger
in Editorial , 292 references
[Comments enabled]  
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So says Judge Nap

Because the Supreme Court has ruled that there are no word choice errors in the Constitution and the words of its text mean what they say, the Framers must have carefully and intentionally chosen to protect every person, not just every citizen. "Person," in this context, has been interpreted to mean any human being on American-controlled soil against whom the American government is proceeding, irrespective of how the person got there.

That's correct, but that doesn't prevent Trump from stopping an invasion without implicating said due process rights.

And let's be clear: Those coming here are not "immigrants"; they're invaders.

An "immigrant" presents themselves at a legal border crossing, explains their intentions, and requests a decision on entry, which they abide.

An invader claims they need no authorization nor will they abide the decisions of officials; they claim a right (which they do not have) to take what they want.

How do you stop invaders?

Order the border sealed, except at legal crossing points which are not US territory until you are past them, enforced by the military.

The Constitution not only authorizes this action it REQUIRES said action (Article V Section 4):

The United States shall guarantee to every State in this Union a Republican Form of Government, and shall protect each of them against Invasion; and on Application of the Legislature, or of the Executive (when the Legislature cannot be convened) against domestic Violence.

It is not an option or choice for the federal government to do this.

IT IS A DUTY FOR THE EXECUTIVE TO PREVENT THE INVASION OF ANY STATE BY FOREIGN NATIONALS.  PERIOD.

No entry except through lawful means at a legal border crossing, period.

And yes, period means period.  It means if necessary you shoot those who, after clear warning (which a fence plus a pointed gun certainly is, and admits no language barrier!) choose to attempt to proceed.

There is no due process right implicated in preventing an invasion.

A person coming here for the pure reason of accessing someone else's economic wealth is in fact invading for the purpose of plunder.  War is, in virtually every case, about plunder.  The taking of territory is plunder.  The taking of people (e.g. rape, assault, murder, etc) is plunder.  The theft of things (e.g. oil, cars, money, etc) is plunder.

An invader comes for the specific purpose of plunder.  Millennia of international law recognizes the right of nations to a border, to stop those who come for the purpose of plunder, and to enforce that prohibition by any means necessary including physically stopping said person by causing them to cease to be alive.

Attempt to proceed across a marked border when there are rifle barrels pointed at you is a clear declaration of your intent to invade. 

The solution to the problem of illegal immigration is to make clear that plunder will not be tolerated and it will be stopped.  There is no due process right for someone who is in the process of invading another nation.  Such an individual has in fact declared war on your nation and intends plunder upon it.

We both can, should and indeed must stop that.  A wall, along with sufficient sensors to detect attempted breaches whether over or below, may be part of the answer but it must include, in any event, fair notice that attempts to plunder our nation will be repelled before the invader sets foot on our soil and must be enforced.

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2018-06-20 14:36 by Karl Denninger
in Small Business , 121 references
[Comments enabled]  

I got 99 problems but secure control of my house isn't one of them.

In no particular order:

  • Problem: Cameras are great. The let you see inside your home when you're not there, along with the periphery.  The problem is that they're inherently insecure, the most-common protocol to view them has no security on the video whatsoever, all of them "phone home", they have low-powered CPUs in them for cost reasons, and they are made and designed in China with who-knows-what sort of back doors in their software.  Solution: HomeDaemon-MCP secures your cameras, making it possible to completely detach them from outside access.  You can obtain the "latest" (last movement) still or real-time video from them over a completely secure connection on your phone at any moment you desire -- from anywhere in the world, and if desired grab an "on demand" video clip to your mobile device.  In addition unlike the simple "if I see movement or detect sound" upload to an insecure cloud some faceless company owns and may use for marketing or other purposes (or almost-as-bad, on-site SD card storage that is trivially stolen by a burglar) HomeDaemon-MCP can, on any set of conditions you define (no matter how complex) upload a fully-secure video clip of a length you determine to a site you, and only you, control using industry-standard and accepted secure communications for use by yourself or the authorities in prosecuting criminal acts.

  • Problem: Locks and other access control devices (e.g. garage door openers) have AES-encrypted (highly secure) options for control, but the "pairing" process is fraught with risk.  Existing controllers poorly handle this, having intentionally sacrificed security on the altar of "convenience", making possible theft of the network security key after which any and all "encrypted" traffic could be intercepted or modified from more than 100' away -- more than enough to tamper with your house from next door or in the street.  This, theoretically at least, could allow a thief to command your door or garage to open for him!  Solution: HomeDaemon-MCP refuses to answer "S0" keying (the risky event) at high power intentionally, preventing key interception at long range with 100% certainty even if you are tricked into attempting to re-install a device.  Instead for S0 secure Z-wave nodes you remove the stick from the controller and pair it at the device itself, which reduces the potential range of interception to inches from hundreds of feet. 

  • Problem: Existing systems all rely on the "cloud" in some fashion or form.  But "cloud" computing is inherently insecure due to computer design priorities that put performance before security, never mind being fraught with the risk that if a server goes down hundreds of thousands or even millions of consumers lose monitoring and control access at once!  Then there are the "microphones" that are supposedly only listening for specific commands yet have been shown to record and send conversations to others without being told to to do so.  Answer: HomeDaemon-MCP never uses voice commands because voice commands are inherently insecure as a microphone must be on and listening all the time in order to detect the alleged "trigger" word or phrase.  This means a programming error or intentional misconduct by a vendor can trivially record, steal and use the contents of your most-intimate conversations -- those in your home (or even bedroom!)  We all have our phones with us today; unlocking yours and touching a screen requires two actions confirming your intent to do something, while denying interception and exploitation by either error or malice.

  • Problem: "Skills" loaded to a device from some third party inherently rely on trust you place in someone else to not misuse your data or worse, spy on you intentionally.  The incentives to violate your trust or spy on you are great and the penalties for firms caught misusing your data have never resulted in a single criminal prosecution of anyone, ever, in the history of these devices and companies.  There is no incentive for a firm not to do this sort of thing because any "penalty" is always limited to a fine (and then only rarely), which is simply passed on to you in the form of higher prices.  Solution: HomeDaemon-MCP is configured and controlled entirely by you or your chosen installer on a local basis in your home, with its configuration stored on a local SD card.  It relies on no external "skills" or code, ever.  You can always, as an administrator and the owner of your home, look at and verify what it is looking at and what actions it takes because unlike an opaque "skill" the configuration is all in an English-like language that is easily understood.

  • Problem: "Cloud" solutions to notifications and events are touted as "more friendly" yet sacrifice security and privacy on the altar of someone else's convenience, particularly when it comes to your mobile phone.  Answer: HomeDaemon-MCP's Android app has zero reliance on a "cloud" for anything, including real-time monitoring.  It provides notification of events as they occur within 90 seconds, even when your phone is asleep and in "low power" mode, and within one second when it's awake, frequently beating the delivery of a text message when sleeping and always beating it when the device is awake, and yet the app consumes only about 1% of your phone's battery power overnight to do so.

  • Problem: Storing passwords on a mobile device is fraught with risk for all the obvious reasons, yet most apps do exactly that, again for your convenience.  Answer: HomeDaemon-MCP's Android app never stores a password.  It instead obtains an authentication token of which you control the length of validity.  Further, a second, one-time use token is returned to the device which is valid for only one command after which it expires, preventing "injection" attacks launched from malicious web sites you may accidentally visit from working.  With no password stored by the app it's impossible to steal it since it's never stored, but only presented when necessary to obtain the authentication token.  Should you lose your mobile device logging out from any device (e.g. a web browser) instantly invalidates the access (and one-time-use) tokens, rendering the connection immediately secure from further access.

Got a desire to make a lot of money?  Then pay me a reasonable amount, own this wholesale (including source) and make a fortune. 

Email karl@denninger.net for more info, or look here.

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