Wednesday, August 27, 2014

Silver Price: When is the big comeback?

Wednesday, August 27, 2014, 13:40 clock

After the dramatic rally three years ago, it's been pretty quiet around the silver. Even in the recent geopolitical turmoil, the precious metal could hardly score. When is the big silver comeback?
While the price of gold in the environment of rising political tensions in the crisis areas last grew again, the silver price fell short of the expectations of many precious metal investors.

In this case, both metals are bought by investors as insurance against inflation. That silver is stronger than gold, also used in industry, is one of the main differences between the metals. And this is certainly one of the factors that currently dampens the demand for silver. Since the beginning of silver has now again a drop of approximately 0.5 percent   recorded, for a fat discount of more than 37 percent last year. Gold was down almost 7 percent, however so far after all. In euro terms, the impact is down even slightly larger.

The price of silver is much more volatile compared to other metals.  
That is, the prices more volatile than about in gold. The value of relationship to each other is changing so continuously. To close on a negative or positive evaluation of one metal over the other, one examines the so-called gold-silver ratio. It is a simple ratio: gold price divided by silver price. The gold-silver ratio indicates with how many ounces of silver can buy one ounce of gold. Currently, we obtain for one unit of gold about 65 units of silver (gold-silver ratio = 65). Is silver to gold has to be classed as rather expensive or cheap?
Gold-silver since 2009
Gold and silver price performance since 2009 in comparison (weekly closing prices, index)

For this one must seek the story and compare the geological conditions. According to scientific estimates, more silver is about 17 times stored as gold in the earth's crust. That alone already points to a mismatch between the current precious metal prices. It should however be borne in mind that silver is used industrially.  

The quantities of ore once funded take so continuously. In contrast, all gold ever mined is still as good as being completely present.

More meaningful is the historical comparison. The gold-silver ratio was about 10 to 20 centuries peak periods experienced the quotient end of the 20s and beginning of the nineties, with values ​​of about 100 The sharp rise in the 20th century is due to the fact that silver completely its cash function was robbed and it is now primarily viewed as an industrial metal. The central banks have large holdings of precious metals, but silver is not among them!

The silver market is also regarded as even more strongly influenced by speculative interests, than the gold market. In the spring of 2010 for the first time media attention manipulation allegations were against large U.S. banks (JP Morgan, HSBC) pronounced and later prosecuted, put the price of silver in the episode a dramatic rally on the dance floor.

Within just one year, the price of silver rose from $ 18 to $ 48. Since then, the silver chart is again in decline. So when is the big comeback? U.S. analysts such as Ted Butler and James Turk expect it for a long time. They assume that the current price represents the true scarcity of the precious metal is not nearly. Sooner or later become a new price jump coming - also in relation to gold. It seems as if only someone would take their foot off the gas. And perhaps, have to force a U.S. bank to again before the price of the white precious metal really picks up speed again.

​source: Gold Reporter

When Israelis Kills Gaza Civilians, They do so with Weapons Provided by U.S.

This US policy makes the US an accessory to War Crimes. Additionally, the US furnishes weapons to terrorist groups which commensurately makes the US a sponsor of world terrorism. "Nay, no way", you say? Republican or Democrat administration, makes no difference in policy. Prove us wrong.
 الرهائن ايران 1980 سيئ، سيئ أمريكا!

Wednesday, August 27, 2014, via AllGov
(photo: Scott Reed, U.S. Air Force, Wikipedia)
When a country like the United States provides more than $3 billion a year in military aid to a country like Israel, which often is involved in wars, American-made hardware is bound to wind up being used.

So has been the case in the recent fighting between Israeli Defense Forces and Hamas. In fact, one of the most tragic events of the conflict involved a U.S.-made weapon.

When Israel launched the missile attack earlier this month that killed 10 civilians in a United Nations school, it used an American-made Hellfire missile, according to The Washington Post. The State Department labeled the attack a "disgraceful'' act.
That wasn't the only time that American weaponry has been used against Hamas and the Palestinians living in Gaza.

A Mark 84 bomb made in the U.S. was found unexploded in the city of Deir al Balah, while 120mm artillery shells—stamped with "Made in USA"—have apparently landed in Rafah, based on shell casings found.

Some of Israel's allies and suppliers, including Spain and Britain, are backing off of or at least reviewing their military shipments. The United Nations has condemned Israel's use of heavy weapons against those in Gaza.

Meanwhile, the Obama administration is providing Israel with more Hellfire missiles. Regardless of what Israel does with them, the U.S. is likely to continue its material support of the Jewish state.

-Noel Brinkerhoff
To Learn More:
In Deaths of Civilians in Gaza, U.S. Weapons Sales to Israel Come under Scrutiny (by Sudarsan Raghavan and Ruth Eglash, Washington Post)

CFR Suggests That Central Banks Print Money and Hand It Out Directly to Consumers

By Staff News & Analysis - August 27, 2014

It Begins: Council On Foreign Relations Proposes That "Central Banks Should Hand Consumers Cash Directly" ... A year ago, when it became abundantly clear that all of the Fed's attempts to boost the economy have failed, leading instead to a record divergence between the "1%" who were benefiting from the Fed's artificial inflation of financial assets ... and everyone else, we wrote that "Bernanke's Helicopter Is Warming Up." ... It's well past time, then, for U.S. policymakers -- as well as their counterparts in other developed countries -- to consider a version of [these] helicopter drops. In the short term, such cash transfers could jump-start the economy. Over the long term, they could reduce dependence on the banking system for growth and reverse the trend of rising inequality. The transfers wouldn't cause damaging inflation, and few doubt that they would work. The only real question is why no government has tried them. – Foreign Affairs at ZeroHedge

Dominant Social Theme: Give them all a living wage and do it now!

Free-Market Analysis: The high-profile website ZeroHedge caused a stir yesterday by presenting an article (see above) that appeared in the CFR's Foreign Affairs magazine.

The article called for the Federal Reserve to hand out money directly to consumers.


The article was of interest to us because of the bluntness of the remedy and also because it further advanced several elite dominant social themes that we've been analyzing for months.

As predicted, there is a new strategy at work, one that has now predictably included Foreign Affairs. The strategy involves the propagation of two memes: "income inequality" and its putative solution, the "universal basic income."

These memes are being proposed in the top news media around the country, as we've already shown, and now they are growing closer to actionable events. Foreign Affairs is a policy-making facility. Next stop? Perhaps the legislature itself.

They're moving fast – faster and faster. Occupy Wall Street was an elite-controlled populist movement that has seemingly fizzled. But it hasn't taken long to reconstitute the desired memes and reposition them as high-row economic concepts endorsed by "Nobel" laureates among others.

What's the desired outcome of all this? As near as we can tell, one intention was to distract people's attention from the dysfunction of monopoly central banking by blaming economic difficulties on the "one percent." Call this the "French Revolution" gambit.

But now the top elites that organize these promotions seem to have reversed course. Instead of distracting people from central banking, the idea now seems to be to glorify the mechanism.

Here's more from ZeroHedge:
Moments ago a stunning article appearing in the "Foreign Affairs" publication of the influential and policy-setting Council of Foreign Relations, titled "Print Less but Transfer More: Why Central Banks Should Give Money Directly to the People."

In it we read the now conventional admission of failure by Keynesians, who however, unwilling to actually admit they have been wrong, urge the even more conventional solution: do more of the same that has lead to the current financial cataclysm, only in this case the authors advocate no longer pretending that the traditional monetary channels work but to, literally, paradrop money.

To wit:

"To some extent, low inflation reflects intense competition in an increasingly globalized economy. But it also occurs when people and businesses are too hesitant to spend their money, which keeps unemployment high and wage growth low. In the eurozone, inflation has recently dropped perilously close to zero. And some countries, such as Portugal and Spain, may already be experiencing deflation. At best, the current policies are not working; at worst, they will lead to further instability and prolonged stagnation.

"Governments must do better. Rather than trying to spur private-sector spending through asset purchases or interest-rate changes, central banks, such as the Fed, should hand consumers cash directly. In practice, this policy could take the form of giving central banks the ability to hand their countries' tax-paying households a certain amount of money. The government could distribute cash equally to all households or, even better, aim for the bottom 80 percent of households in terms of income. Targeting those who earn the least would have two primary benefits. For one thing, lower-income households are more prone to consume, so they would provide a greater boost to spending. For another, the policy would offset rising income inequality."

This is pretty incredible stuff. We've always maintained that central banks will NEVER print money directly for individual consumers because to do so would be to reveal the mysterious motor at the heart of the modern economy. So what gives the Big Brains behind this central banking paradigm the idea that handing out money directly to consumers will somehow stimulate stagnant economies while palliating the lower classes that are apparently to be targeted for such a giveaway?

It's kinda, well ... crazy.

Do those suggesting this actually think that people will be satisfied with a relative pittance (no matter how generous) once they realize that those in control of the money apparatus can basically print trillions for themselves and their friends?

And what about others who don't receive a similar stipend? These individuals would probably be irritated that they are not qualifying and also increasingly upset about the banking mechanism itself – as it went to work, handing out money to lucky recipients.

The article reads more like a satire or parody than a serious suggestion. But we live in incredible times. The globalist crowd seems increasingly panicked by the Internet and how it has exposed internationalism generally and specific promotions as well.

Whether it is economic stagnation or a widening of the war on terror, people are increasingly skeptical that disastrous economic and military events are either accidental or inevitable. Increasingly a connection is being made between elite internationalism and the themes (and events) intended to push middle classes into giving up power and authority to globalist facilities.

Put it bluntly: The idea that Foreign Affairs writers and editors believe that freely handing out currency is going to strengthen the economy and solidify good will for the current central banking system is either naïve or sinister.

We arrive at the possibility of "sinister" because it appears to us that the globalists have perhaps given up on arriving at a more structured and rationalized internationalism via stealth. Instead, they are apparently moving forward with the age-old tools of economic ruin and military engagement.

Giving away currency would surely be another step toward destroying the modern system and setting the stage for a new one, presumably even more internationalist. Either way, this "trial balloon," if that is what it is, is surely not intended to achieve the real-world results its proponents are arguing for. We can't see it ending well.

Apparently, the remnants of Occupy Wall Street may be gearing up to propose a "debt jubilee" and perhaps this idea of a currency giveaway is supposed to find a place within the larger promotion. 

But if this is to be one of the "solutions" to the "income inequality" meme, it strikes us that those producing these promotions have virtually lost the plot.


We'll see how all this plays out in autumn. Interesting times.

S​ource ​: TheDailyBell

Tuesday, August 26, 2014

How The Coming Silver Price Bubble Will Develop - Ted Butler

On the other hand, with or absent manipulation, silver will always be money. It has been a millennial refuge for those seeking a safe harbor for their dying fiat currencies. A panic along that plain, IMO, would ignite silver's price and reach a magnitude far greater than just a "shortage."

We reported this yesterday, but didn't see any mention by Mr. Butler: Gold and Silver Futures Margins Lowered by CME
In the "past" the lowering of margin requirements has given an immediate bullish blip to prices, but not yet it seems.

Commodities / Gold and Silver 2014 Aug 26, 2014 - 06:07 PM GMT
Ted Butler writes: What is an asset bubble? An asset bubble occurs when a large number of buyers, normally not usually prone to speculate in an asset, bid the price of that asset much higher than underlying valuations would support, most often fueled by leverage or borrowed money. 

Typically, towards the terminal phase of the bubble the most compelling reason for continuing to buy the asset is due to the rising price itself, as all caution is thrown to the wind amid the collective belief that prices can only move higher still. Then, when the last possible speculator has purchased the asset, the inevitable occurs and the price of the asset collapses as previous buyers turn into sellers and attempt to get out. Since the formation of the bubble and its inevitable collapse are driven by the collective emotions of greed and fear, it is generally impossible to predict how long an asset bubble will persist and how high the price can climb, as well as the timing and extent of the subsequent collapse.

How do asset bubbles develop? Most often, an asset bubble develops when an undervalued asset which has a compelling investment story and there exists an overall financial environment of sufficient buying power, catches the collective interest of the crowd. For example, by the mid-2000's and after years of steady appreciation, residential real estate developed into an asset bubble amid the self-fulfilling cycle of continued gains and the availability of easy credit.

As far as great stories go, silver has the best potential story to develop into a bubble. First, there is little argument that it is among the most, if not the most undervalued asset of all by objective relative historical price comparison. In addition, it is at or below its primary cost of production, as evidenced in recent quarterly earnings reports. Remember, most bubbles start out with an asset that is undervalued – on this score silver more than qualifies as being undervalued.

Aside from extreme undervaluation, the silver story is multi-faceted. Silver is both an industrial metal and a primary investment asset, the net effect being that very little newly-produced silver is available for investment, perhaps only 10% of the one billion oz produced yearly (mine plus recycling), or 100 million oz annually. In dollar terms, at current prices that comes to less than $2 billion per year. There are two ways to look at that; the observation that there are countless individuals and investment funds capable of ponying up that entire amount on their own and the fact that $2 billion amounts to less than 30 cents on a per capita basis for the world's 7 billion inhabitants. Simply put, there is no other asset class which would require less buying to develop into a bubble than silver.

Apart from newly-produced silver available for investment, the amount of previously produced metal available for investment, or world inventories, is also shockingly low. As a result of a 65 year deficit consumption pattern that ended in 2005, world silver inventories have been depleted by 90% from the levels existing at the start of World War II. Today, only a little over one billion oz of metal in accepted bullion industrial form exists with perhaps another billion oz existing in coins and bars. In dollar terms, that comes to $20 to $40 billion, where most other asset classes (stocks, bonds, real estate and even gold) are measured in the many trillions of dollars. And please, never confuse what exists with what's available for purchase – only the owners of the small amount of silver that exists will determine at what price it is available.

The conclusion is simple – the asset requiring the least amount of buying to create a bubble is, automatically, the best candidate for developing into the biggest bubble. The fuel for any bubble is total (world) buying power versus the actual amount of an asset available for purchase. Previous, as well as prospective, bubbles in stocks, bonds and real estate grew to many trillions of dollars of total valuation. At $200 an ounce, all the silver in the world (bullion plus coins) would "only" amount to $400 billion, not even a rounding error to the total valuation of stocks, bonds, real estate and, even, gold. In other words, due to silver's current undervaluation and its shockingly small amount in existence, it has more room to the upside than any other asset class.

But I'm not done. Silver's unique dual role as a vital industrial material and primary investment asset creates a setup for something happening that has never occurred in any previous bubble. As and when sufficient physical investment buying develops in silver to drive prices significantly higher, the industrial consumers of silver, in everything from electrical and solar applications to medical and chemical applications, will likely be subject to delays in the customary delivery timelines of the metal. As is almost always the case, whenever industrial consumers of a commodity are deprived of timely deliveries, they resort to stockpiling that commodity as a remedy, further exacerbating delivery delays to other users.

Thus, the stage is set for something the world has never experienced previously – an asset bubble accompanied with an industrial shortage. The two greatest upward price forces known to man, an asset bubble and a genuine commodity shortage, appear set to combine in silver. Either one, alone, would have a profound impact on the price, but the combination seems both inevitable and almost impossible to contemplate in terms of how high the price of silver could be driven. And it's hard to see how intense investment buying wouldn't trip off industrial user attempted inventory stockpiling or vice versa; it doesn't matter which comes first.

Tying everything together, there is one and only one explanation for why silver is so undervalued and the asset bubble/industrial shortage hasn't occurred yet – the ongoing price manipulation on the COMEX. Massive amounts of paper contracts traded between two groups of large speculators (technical funds and commercials), measuring in the hundreds of millions of ounces and completely unrelated to the supply/demand fundamentals have set the price of silver. This COMEX price control is both the curse and the promise in that it not only explains the undervaluation, it will explain why it seems inevitable for an asset bubble/user shortage to develop.

Think of it this way – the asset with the greatest potential for becoming the biggest bubble ever had better have the greatest story ever as well.  And that is what the COMEX silver manipulation is – the key ingredient in the greatest investment potential score ever.  If silver wasn't manipulated how good would the story be? Absent manipulation, I wouldn't buy or hold silver because that would mean that free market forces were setting the price all along. In other words, if silver wasn't manipulated there would be scant reason to buy it in my eyes. If I wasn't convinced silver was manipulated, I can't see how I would have ever written this or anything about it in the past or could have become interested in it in the first place.

As painful as recent prices have been to existing holders because of the manipulation, without it there would be little chance for a price explosion at some point. The easiest major potential change in the silver price equation is for the manipulation to end, one way or another. And if history and logic win out, the silver manipulation must end, not the least because of the coming clash between paper and physical silver. Some call it the disconnect between paper derivatives contract on the COMEX and actual physical silver, but in reality the story is that COMEX futures contracts are very much connected to each other via the delivery mechanism.

The connection between paper and physical has been forged because the main COMEX futures speculators are only interested in trading paper futures contracts and not in trading physical metal. Technical funds have no desire to buy and sell real metal for full cash payment when they can deal in paper contracts for only 10% cash down because they are trading, not investing. The problem is that the trading between the technical funds and the commercials has become so large that it dwarfs real world silver supply/demand fundamentals and ends up setting the price of silver in violation of commodity law. I know that this perversion of the price-discovery process has existed for a long time, but it would be wrong to confuse longevity with permanence.

The fact is that while the COMEX paper market dominance has lorded over the real supply and demand fundamentals, the stage has been set for a physical asset bubble/industrial user panic event. I've become convinced that any prospective bubble in silver won't be driven by the aggressive buying of COMEX futures contracts, but only by physical buying. For one thing, the crooked CME and CFTC would never allow any group of traders to drive silver prices sharply higher by buying unlimited amounts of COMEX futures contracts. If the technical funds do buy big amounts of COMEX silver futures contracts (as was the case from June to mid-July), you can almost be certain that the CME and CFTC knew that those funds would be soon forced to sell on lower prices.

As a result, any bubble in silver must and will develop from physical investment buying. Surely, any industrial user inventory buying panic must involve immediate physical delivery and not a paper futures contract in a time of delivery delays and uncertainty. In fact, it is hard to imagine, as a silver bubble begins to develop, a greater urgency for holding only physical metal to intensify, due to a growing recognition that the COMEX manipulation was responsible for the former low price.

Since I am speaking in terms of a potential historic asset bubble in silver, I am implying that the price of silver will far exceed its true value at some point before correcting sharply. It is before that collapse point, that God-willing, I intend to sell. I am not deluding myself that I will come close except hoping not to be terribly early or late. While I respect anyone's reasons for buying and holding silver, my mission has always been to help end the manipulation and be done with silver after that was accomplished and reflected in the price.

This article is based on a commentary of Ted Butler's premium service at which contains the highest quality of gold and silver market analysis. Ted Butler is specialized in precious metals market analysis for over four decades.

Source -

© 2014 Copyright goldsilverworlds - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Investor Net Worth Drops To New All Time Low, NYSE Reveals

Submitted by Tyler Durden on 08/26/2014 15:25 -0400

​O​ne can debate whether or not margin debt as reported by the NYSE has any relevance in a world in which the retail investor is long gone, and where the marginal buyer are hedge funds (and primary dealers who use excess reserves as collateral for marginable derivatives and futures) who fund themselves using far more arcane "shadow" repo conduits as we have explained previously, it is indisputable that the leverage statistics disclosed monthly by New York Stock Exchange provide a useful glimpse into how the broader market is obtaining "dry powder" to keep BTFATH.

And while in July margin debt did dip modestly from near all time highs hit back in June when total margin debt was virtually tied with the previous record, at $464 billion, it was that other metric tracked by the NYSE, namely Investor Net Worth, calculated by subtracting margin debt from the notional represented in free credit cash accounts and credit balances in margin accounts, that was the notable highlight in the July report: at a negative $182.1 billion, a decline of $6.3 billion from the prior month, investor Net Worth has never been lower.

This happens to be a deficit which is more than twice as large as the net worth shortfall reached during the last market bubble, which hit ($79) billion, peaking during the quant freakout in the summer of 2007 and subsequently surging to a record high of $184.6 billion in August 2008, as repo desks closed all margin positions with virtually any and every counterparty, leaving everyone in a position of record high "net worth."

Does this, or anything else, matter in a market that is exclusively centrally-planned by the central banks and various HFT algos? We urge you to direct your questions, rhetorical as they may be, on this topic to either the NY Fed or its oftentime execution trading arm, Citadel.
Source: NYSE
​Via Zero Hedge

New Jersey Funneling Pension Fund Cash to Wall Street Investment Managers

Are others finding it just as bewildering as we do how the politicians can keep on stealing when we've learned so much with the internet? They are an in-your-face gang, for sure. Will 'enough' ever be really enough?

We have become totally per-occupied and distracted by the street police focus that we no longer recognize law enforcement where there isn't any.

Posted on August 26, 2014 by
By David Dayen, a lapsed blogger, now a freelance writer based in Los Angeles, CA. Follow him on Twitter @ddayen

David Sirota has carved out a much-needed niche lately by poking around in the unseemly deals between public pension funds and Wall Street predators, and he brings yet another scoop, this time in New Jersey:

Gov. Chris Christie's administration openly acknowledged that more New Jersey taxpayer dollars were going to land in the coffers of major financial institutions. It was 2010, and Christie had just installed a longtime private equity executive, Robert Grady, to manage the state's pension money. Grady promoted a plan to put more of those funds into riskier investments managed by Wall Street firms. Though this would entail higher fees, Grady said the strategy would "maximize returns while appropriately managing risk."

Four years later, New Jersey has secured only half the promised results. The state has sent more pension money to big-name Wall Street firms like Blackstone, Third Point, Omega Advisors, Elliott Associates and Grady's old firm, The Carlyle Group. Additionally, the amount of fees the state pays financial managers has more than tripled since Christie assumed office. New Jersey is now one of America's largest investors in hedge funds.

The "maximized returns" have yet to materialize… Had New Jersey's pension system simply matched the median rate of return, the state would have reaped roughly $3.8 billion more than it did between fiscal years 2011 and 2014, says pension consultant Chris Tobe.

The $939.8 million million in Wall Street fees from 2010-2013 are bad enough, especially for below-market returns, but the sheer riskiness of these bets, essentially letting fund managers gamble with public money, is truly nauseating. As Sirota points out, New Jersey has authorized over one-third of its pension funds to alternative investments, from hedge funds to private equity firms to venture capital funds. That is alarmingly high. Calpers, the largest pension fund in the country, has dropped their alternative investment stake to less than half that. These investments don't outperform the market, but they're great to grease the palms of the managers with fees. In this case, those managers happen to be ket backers of Chris Christie:

The above-average costs for New Jersey are a direct result of Christie administration officials moving more pension money to Wall Street firms. The management fees those firms charge are far more expensive than the fees for passive index funds and the costs associated with equities being managed by in-house pension staff. Investments with Wall Street managers comprise less than half of New Jersey's pension portfolio — but those investments' attendant fees account for 96 percent of the pension system's total overhead expenses, according to State Investment Council documents [...]

As previously reported by IBTimes, campaign finance records show that employees and others affiliated with firms managing New Jersey pension money made $167,000 worth of donations to New Jersey Republicans since 2009. Employees of those firms have also donated more than $11 million to the Republican Governors Association and the Republican National Committee.

Christie is the chairman of the RGA and both organizations spent heavily to support his 2013 reelection campaign.

This amounts to Christie funding his presidential ambitions with New Jerseyite's taxpayer money. He funnels that money to Wall Street managers, and they recycle a chunk of it back to him and his causes. As Sirota points out, the donations line up with when the firms got the contracts to manage the pension money. In one case, a contract went to the venture capital firm General Catalyst Group right after one of their partners made a $10,000 donation to the state Republican Party.

It's more than amusing seeing Orin Kramer try to justify these practices to Sirota. Kramer, the hedgie and former chair of the State Investment Council, ran the pension fund into the ground by dumping money into Lehman-related assets, leading to $115 million in losses. (We got a very fun phone call from Kramer the last time we had the temerity to mention that on this site, so keep your line open, Yves!)

The amount of back-patting and favor-making in New Jersey, done with public money, which all then justifies cutting the meager pensions of state employees, deserves a ton more scrutiny. So it's good that Sirota's been on the case.

Source nakedcapitalism

One State Can Lead the Charge

Are we but a nation of legislatures without statesmen? Then, let them stand and be counted.

At times, the federal government seems overwhelming. Frankly, it sometimes appears as an unstoppable juggernaut without any obstacle in its path. Undoubtedly, the scale of power assumed by the federal government has been immense. It has morphed from the stated purpose of a "more perfect union" to an unconstrained nationalist state.

Despite this perception, Judge Andrew Napolitano recently suggested that if a single state acted to obstruct federal mandates, it would make new federal gun laws "nearly impossible to enforce" within that state.

Napolitano's words are not based on theory, they have been definitively proven.

​The State of ​
Washington recently stood up to the federal government's anti-marijuana mandates in a direct way. After gathering the requisite amount of signatures in 2011, Washington passed Initiative 502 after a successful referendum on the November 2012 general ballot. This initiative is credited with spurring an 81% electoral turnout in Washington, the highest in the union. While the state retained regulatory power over marijuana usage, it turned its back on and intentionally disregarded federal restrictions toward the substance.

After observing Washington gather enough signatures for its referendum, Colorado followed suit in opposing federal drug prohibitions. Once started as a proposal in January 2012, the state passed a constitutional amendment to legalize marijuana usage after its own referendum on November 6, 2012. As a consequence, another state stood firmly against federal policy and produced an intentionally conflicting license to possess and use a substance banned by the federal government.

The actions of Washington and Colorado seem to have forced the hand of the union's capitol. At this point, the White House has conceded the use of its power to prosecute marijuana usage in these states. This development can only be attributed to the amount of resources the government would have to devote to this enforcement strategy, and the cooperation needed from state officials to pursue and secure convictions.

This phenomenon of successful resistance is not restricted to substance control.

In 2007, immediate controversy arose over the federal government's desire to issue identification card standards for the states. In doing so, the federal government was interested in making identification data uniform, requiring the states to adopt the same process to obtain an identification card, and linking state information databases.

The REAL ID Act, as it would be called, imposed a national standard by forcing the states to adopt uniform standards for their identification cards – or did it?

Maine responded by passing a resolution in 2007 that refused any type of REAL ID adoption in the state. Surely, Maine's legislature was warned by opponents who dreaded the thought of opposing the federal juggernaut. Leading the charge, Maine showed that one state can stand up against the iron will of the federal state.

When Maine stood up, Utah took notice. Utah passed a similar bill a month later. The Utah law noted that REAL ID is "in opposition to the Jeffersonian principles of individual liberty, free markets, and limited government." Since that time, 22 states passed similar bills and resolutions, creating additional opposition toward the national standard. Similar resolutions are pending in over a dozen additional states.

As a result, the REAL ID Act has been effectively neutered in much of the country. The federal government has not elected to devote its resources to enforce the mandate, sue the participating states, or send in the tanks as a result.

From these two examples, we can observe that a large part of the federal government's contemporary supremacy is reliant on the cooperation it receives from the states. Absent this cooperation, the federal government is not as fierce and imposing as it may seem.

Political philosopher and economist Hans-Hermann Hoppe realized this, noting:

"Without local enforcement, by compliant local authorities, the will of the central government is not much more than hot air."

Surely, our contemporary perception toward the federal government is at least partially because of the "built in" state cooperation that contributes to its power apparatus.

In The Federalist #46, Madison suggested shattering this type of cooperation through state barricades, which could be utilized to block unconstitutional and unpopular federal law. He wrote that "refusal to cooperate with officers of the union" would be a viable strategy, and said multiple states taking this approach would create "obstructions which the federal government would hardly be willing to encounter."

Madison did not suggest waiting for the federal courts to weigh in on controversial policy, either as a final hope or last resort.

Recent history suggests that when states invoke Madison's advice and refuse to cooperative, the ambitions of the federal government can be rendered impotent and ineffectual. Federal authority is not infallible or impervious.

The next time the federal government seems too powerful for imposing, or naysayers doubt the anti-commandeering doctrine or nullification strategy, consider the alternative. In these two recent instances, states have proven that the federal government simply cannot enforce all it wants to in the face of blatant opposition. The states that stood up first on these matters began the charge toward liberty.

Marco Rubio has ties with George Soros

Be sure to read the embedded links in this Marco Rubio article.  You will come away with a different idea of who is on our side.

More evidence that Marco Rubio is a trojan horse plant.