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Buy this essay and others in Jim's new book Being Sovereign.

The Indomitus Report
Volume 2, #33

10 October 2005
"Serenity"

Being Sovereign

A very nice film released at the end of September tells the story of mankind five centuries from now, among the stars. If you prefer not to have film plots discussed before you get to see the film, you may wish to click here to scroll to the next section of the newsletter. This film "Serenity" certainly stands up to being seen after reviewing the plot.

Indeed, if there is any single plot twist or complication that might involve suspense for most audience members, it is pretty clear from "official denials" provided in the film (which foreshadow the key revelation) what is about to be revealed. But, since you may be making up your mind whether to skip this film review, I'll place my spoiler a bit further long.

One of the background elements to this film and its precursor television series Firefly and comic book Serenity is a universe in which humans have moved beyond Earth. Planets in other star systems are terraformed to become Earth-like. Several of these new Earths are located in one star system which forms the core of an advanced human civilization called "The Alliance." The Alliance is the central government in the future, and thus various found metaphors comparing it to the USA central government or the banking cartel's dreams of potestas are possible.

The Alliance is an authoritarian government. Early in the film we see the character River Tam as a youth in an idyllic classroom set within a garden of paradise. Her teacher asks the class why "the independents" fought against the glorious, all-powerful, benevolent Alliance.

River responds that the Alliance meddles. "People don't like to be meddled with."

The teacher comes over and takes up River's pencil from her, then says that the Alliance doesn't tell people what to think, but merely shows them how. Then she drives the pencil into River's forehead. At the same time an older River is seen strapped into a lab chair being meddled with by a technician who drives a needle into her brain while she writhes and screams.

My own first reaction to the term "the Alliance," was to think of the Allies of World War Two, followed moments later by the thought that the UK-USA alliance consisting of the USA, United Kingdom, Canada, New Zealand, and Australia was a likely model for this film Alliance. This idea was emphasized when the leading brain meddler, Dr. Mathias, explained that River's mind re-conditioning was known of and approved by the leading members of "parliament," who had visited her and agreed to her being tortured. It seems her role was to be an assassin for the Alliance.

In a number of other scenes in the film, it becomes apparent that the Alliance was opposed by the independents. A war was fought perhaps ten years in the past. The authoritarians won. So, of course, they enforce "peace" in the same sense that the child-raping United Nations peacekeepers do. Outward from the core planets of the Alliance are the outer planets orbiting various other stars. For reasons that may be peculiar to the vision of Joss Whedon, these planets outside the control of the Alliance are all depicted as deserts. Perhaps their terraforming didn't take, or perhaps they are a metaphorical stand-in for the many desert realms in Chaostan, Rick Maybury's term for the countries outside of mainstream civilization.

Further away from the core worlds and the somewhat anarchistic outer planets are the Reavers. The Reavers are savage, cannibalistic, and mindlessly violent humans who raid outer planets and Alliance planets near the frontier. However, their existence is officially denied. Several news reports are heard at various points in the film to relate this official denial. Naturally, one immediately suspects that the Alliance must have had something to do with these Reavers.

Early in the film, River is rescued by her brother, Simon. Simon was a young prodigy, as was River. He had given up a promising career in medicine to pursue the rescue of his sister. The rescue sequences are very exciting, and transition in an interesting way to a post-rescue briefing of an Alliance "operative" about the events involved.

The operative is a brutal, vicious killer who has apparently been conditioned from near the time of birth to function without a name. Instead, he has the highest available Alliance clearance. Again, one could go wild with found metaphors for contemporary espionage operatives or the Delta Force "operators" who were responsible for the massacres of civilians in the church at Mt. Carmel and on the streets of Mogadishu in 1993. Visions of "The Bourne Identity."

The operative interviews the leading brain meddler, Dr. Mathias, and accuses him of pride. He then reviews the earlier events in which Mathias told Simon, just prior to the jailbreak, that leading members of parliament had visited River. Since River is psychic, the exposure of these leading MPs to her has presumably exposed top secret information, which has now escaped along with River. Mathias responds that his meddling has so traumatized River that she won't be able to remember any of the secrets. As if that were a good thing.

Evidently, this response is insufficient. The operative kills everyone in the room except Mathias and a records clerk. He arranges for Mathias to fall upon the operative's sword in a fashion reminiscent of Roman officer suicide. As Mathias is bleeding to death on the blade, the operative asserts, "This is an honorable death." His tone is so matter of fact, one can see that he has been conditioned to believe this absurdity. Of course, any sympathy would be wasted on Mathias, who seems to be responsible for creating assassins like the operative.

Turning to the blood-spattered records clerk, the operative now requests that she fetch records on the exact nature of the behavioral modifications imposed on River. In the balance of the film, we find out that the sort of carefree massacres we just saw perpetrated by the operative are part of the assassin training to which River has been subjected.

The film now catches up with the television series, "Firefly." Eight months have passed since the escape by River and Simon. They are aboard the good ship Serenity, whose captain, Malcolm "Mal" Reynolds, is a veteran of the war - he was actually a volunteer for the independents. We find the captain and crew plotting a payroll heist.

Well, actually, we meet up with them while Serenity is landing on a planet with less than smooth re-entry dynamics involved. A passageway conversation between Simon and Mal reveals that the crew have been avoiding the Alliance, protecting Simon and River, in exchange for which Simon has functioned as ship's surgeon, treating stab wounds and gunshots. Simon doesn't want his sister to go along on the job, but Mal insists that a psychic would be useful.

The payroll is for a security firm in the employ of the Alliance, so it is presumably Alliance money being seized in the heist. During the robbery, River senses that a man is reaching for a gun, and she points this out to Mal's second in command, Zoe. Zoe puts her gun to the man's head and intones, "You know what the definition of a hero is? Someone who gets other people killed."

During this heist, we learn that the independents were also known as browncoats, presumably in the same sense that the Confederates were known as greycoats. Mal and Zoe fetch the payroll from the vault while outside a mother and son are brutally attacked by something the camera doesn't show much of. River falls to the ground gasping the word, "Reavers." She obviously cannot see them, so we assume it is her psychic ability that has brought this warning.

Everyone springs into action. Mal urges the security chief whose payroll has just been robbed to lock everyone in the vault, presumably in fear of the Reavers. Outside the crew get on their getaway vehicle which starts off, and a local man tries to grab a ride, presumably because he likes neither the Alliance nor the Reavers. Horrible looking vessels with deformed and ravaged-looking people descend on the town and begin to massacre everyone in sight. Mal grabs the would-be hitchhiker and throws him off, presumably to lighten the load for what seems to be an impending chase scene, urging the man to flee to the vault.

Too late, though, the Reavers grab the man and begin to eat him alive. So, Mal shoots the man dead. Thus begins the obligatory surface vehicle chase scene.

The vehicle in which our protagonist and his crew are fleeing is a sort of open jalopy with hovercraft capability and bodacious large engines. Behind is a giant enormous Reaver vessel festooned with alarming body parts and various large plasma cannons. One of the crew asks why the vessel which is chasing them doesn't simply blast them out of the air. The reply from Mal is somewhat grisly, to the effect that the Reavers prefer to eat their victims alive.

Inevitably, the crew escapes with a daring rescue by the pilot of the Serenity and much high speed maneuvering. These special effects were engaging and realistic, but the conclusion of the chase sequence was unsurprising. The aftergame analysis was also expected value.

Mal is confronted in a passageway aboard ship by Zoe who wants to know why the man who wanted to go with them was thrown to the Reavers. Mal explains that killing him was for his own good, and Zoe agrees it was a "piece of mercy," but wants to know why the man wasn't allowed to come along. Mal explains that their getaway vehicle only held five. Zoe suggests they could have dumped the loot.

One of the nice things about this film is Mal's response. He points out that his responsibilities extend to the crew, his ship (parts of which have been falling off), and the people who hired him for the job. His responsibilities do not extend to every jerk who comes along wanting a free ride to a better life. Zoe suggests that in the war the independents would never have left a man behind, to which Mal retorts, "Maybe that's why we lost."

A few scenes later, the crew of Serenity rendezvous with the guys who hired them for the payroll heist. During this meeting, River sees a television screen which seems to mesmerize her. Indeed, from other cues in the film, it is clear that she is receiving a subliminal signal intended to activate her assassin training. Various images flash through her mind and she whispers the name "Miranda." Then she begins to attack everyone in sight, in a very dramatic scene quite well choreographed and nearly believable. Just before River can waste Mal, her brother Simon shows up and utters some words in Russian which are evidently her safe-release words, and she falls immediately asleep.

After some unsatisfying dialog, it materializes that Mal knows a hacker named "Mr. Universe." This character is able to tap into the security tapes and the video feeds in the barroom where the brawl took place. He finds the subliminal message which turned on River's training, and he points out that it has been very widely broadcast. Evidently, someone in the Alliance has been trying to turn River's assassin training on, to help find her. And, indeed, we see a brief scene of the Operative viewing the same security tapes that Mr. Universe was just watching, and calling up a file on Mal.

Now very aware that having River aboard is endangering his crew, Mal goes to a safe haven. The safe haven is a planet named Haven. Gee. And, a desert. Docking in a hidden landing site, the crew of Serenity meets with the human colony leader on Haven, a guy named Shepherd Book. The actor who plays Book is the first one I'd seen in any other film or television program, Ron Glass who played the black disc jockey Venus Flytrap on "WKRP in Cincinatti." The film basically takes a break here for expositions. I was tempted several times to start whistling the theme music from "WKRP," but managed to refrain.

This process of exposition continues to the next fight scene. The operative from the Alliance has laid a trap, getting Mal's old girlfriend (who seems to be some sort of hetaera) to phone him up and invite him over. Mal suspects a trap, as does his crew, so he's more or less prepared to encounter the operative. Unfortunately, at the critical juncture, he shoots the operative in the chest. Doh. The operative is wearing body armor. At this point, I couldn't help blurting out, "Two in the chest, one in the head." It is quite amazing how five hundred years in the future people still don't know this basic rule of combat engagements. Naturally, the hero and his gal manage to escape the evil operative through subterfuge and a bit of hard fighting.

There is more psychic mumbo-jumbo, a good deal more stilted dialog, and rather a lot of unlikely things being done in the name of advancing the plot. These aren't really any worse than, say, the exposition scenes in the various "Star Wars" films. This film makes up for its slow-paced plot revelations with fairly effective special effects and scenery gizmos that allow one to think about other things besides ... stilted dialog.

We now get to the good part. Insert spoiler warning bold faced text here. Miranda turns out to be a planet, which River is able to find on the navigation computer aboard ship. It develops that the planet was colonized some time ago, but apparently the terraforming didn't take and it was abandoned. And, to get there one has to go through the heart of Reaver territory. Really, one would be hard pressed not to add up these pieces.

Rather than proceed to the climactic scenes at Miranda, the film takes another pause for an obligatory dying man scene. Mal resolves to puzzle out the mysteries of Miranda by...returning to Haven. As the ship arrives, it becomes clear that Alliance forces have destroyed the community which had been their safe haven just a few scenes earlier. Indeed, women and children have been brutally massacred in a scene from Ruby Ridge or Mt. Carmel. Shepherd Book dies in Mal's arms in a scene that makes clear how little first aid has advanced in five centuries. Almost immediately, we see a montage of similar scenes wherever the Serenity has visited after a heist in the past, suggesting the arch brutality of the Alliance's operative, as though such emphasis were needed.

The operative reveals that he is himself a monster, but that his purpose is to create a better world. One immediately imagines all sorts of possible dialog about ends and means. Fortunately, we are spared these inanities as Mal hangs up on the operative.

Fortunately, at this point, Mal gets it. He has his crew use some of the bodies at Haven to disguise Serenity as a Reaver ship. Red paint, an externally mounted plasma cannon (which, strangely, seems to be a unique Reaver adaptation) and a slightly mis-aligned reactor and the disguise is complete. They successfully penetrate the heart of Reaver territory and land on Miranda.

Happily, the film doesn't try to dwell very long on the mystery. Miranda has 30 million dead people, most of whom seem to have simply laid down to die. The one remaining power source turns out to be an Alliance rescue and recovery ship which contains a recorded message. An Alliance scientist explains that the experiment had failed. Everyone else in her crew is dead, and she wants to explain what went wrong.

The experiment was an attempt to make a better world by improving the human race. The Alliance tried to make people calmer and eliminate aggression. They've added the Pax, a mind-altering substance, to the air. It worked great. Ninety percent of the population became very calm, ceased being aggressive enough to find food, and laid down to die. Passivity in trump cards. But, ten percent of the people reacted to the drug in the opposite way, becoming feral, aggressive, brutal, mindless, and crazed. So, now we know where Reavers come from. They come from the Alliance meddling with the human race. In an obligatory moment of poetic justice, the scientist making the report is attacked by Reavers. She shoots her pistol at them, realizes she's going to be overwhelmed, tries to shoot herself, and we get a glimpse of a Reaver tackling her out of camera view, presumably to eat her alive.

It now becomes the mission of Serenity to expose this horror to the rest of the galaxy. Obviously, the Alliance is just the sort of authoritarian government that would not be satisfied with massacring 30 million people in their attempts to control humanity. So, to get the word out, the crew take the recorded message and head for Mr. Universe who can broadcast the information effectively.

For some reason, this data tape has to be physically transported, which is a bit odd. So, rather than uploading the recorded information to Mr. Universe, the crew has to go to his location. Mr. Universe agrees to the proposed broadcast, but we see that the operative is one step ahead. We see the operative run Mr. Universe through with his sword.

There now develops a very impressive space-based chase scene, fight scene, and all around three-dimensional choreographed special effects tour de force. Unlike the rather disappointing fight sequences in some of the "Star Wars" films which seemed to have been lifted from the film "Midway" swapping space fighters for aircraft, the fight scenes in "Serenity" are very original material, and quite well executed. It is a gripping sequence, with an Alliance fleet engaging a Reaver fleet and the operative and Serenity surviving to reach the planet where Mr. Universe has his stronghold.

In the stronghold, there are some more compelling sequences between ground-based Reavers and the crew of Serenity. We are now in full-blown action film shoot-'em-up mode. There is an obligatory fight to the finish between the protagonist and the antagonist, with pithy dialog. The operative asks Mal whether he's willing to die for the cause of telling the galaxy about the Alliance's misdeeds on Miranda, and Mal says yes, then shoots the operative several times and quips, "Of course, that's not Plan A."

We've obviously reached the climax of the film. Fighting in the hallways and at the broadcast center reaches a crescendo of violence. River proves to be a very effective fighter. Ultimately, the good guys win, and Mal pins the operative down while he plays the recorded message of that Alliance scientist admitting that the experiment had failed. As scene after scene of death and misery is shown, the operative is genuinely horrified. Mal says, "There's your 'better world.'"

Mal returns to his crew who have been holding off an enormous number of Reavers. River is revealed to be unharmed, but quite competent with Reaver weaponry. Then Alliance soldiers blast their way in, prepared to execute everyone. The operative tells them to stand down, so he's apparently gotten wise and presumably no longer seeks to be an Alliance team player.

There's a touching funeral sequence which involves Shinto-style prayers launched on a model rocket. The denouemont is provided by the operative, who explains that their signal has caused uprisings and generally weakened the Alliance. But, it isn't destroyed, and will no doubt go on doing evil. Otherwise, where would the film get a sequel.

For action, special effects, and the basically enjoyable aspects of a hero representing good winning out against a sly and brutal villain representing pure evil, this was a nice film. There were no great moments of drama, much of the exposition was stilted, some of the dialog was banal, and the acting was not first rate. On the other hand, these actors all have strong potential and should see their best work ahead of them. Quite a lot of the plot was predictable. Even so, it's a fun film.

It may be deliberate allegory. Certainly, there are lots of parallels. The people who run the USA apparently believe that they are smarter than everyone else, more suited to run things, scientific in their socialism, and are quite eager to make improvements. So, we have toxic waste from uranium enrichment, fluoride, added to the water with the intention of stronger teeth and some behavior modifying side effects. Vaccines, we are told, are good for all children, and required for attendance at public schools. Presumably, the government that lies about weapons of mass destruction in Iraq cannot be trusted to be honest about what is being injected into children. The opportunities for mischief in any situation where a group of people have a great deal of power are too numerous to list.

A few thoughts on names. There was a Dong Tam base in Vietnam, engineered out of flooded rice paddy land in the Mekong Delta near My Tho. The words "Dong Tam" in Vietnamese are supposed to mean "united hearts and minds," another one of those great McNamara moments. The base was created by the USA military to occupy the Mekong Delta region, and came under heavy attack in February and March 1969. The US Navy "River Assault Squadron 9" maintained semi-permanent anchorage in the My Tho River near Dong Tam. Perhaps "River Tam" is meant to evoke thoughts relating to this period of imperial brutality.

Malcolm is a Scots name meaning "servant of Columba." Columba was an early Christian missionary to the Picts, roughly Sixth Century. The term "servant of Columba" would translate to monk or priest. Mal is Latin for evil (as in "Honi soit qui mal y pense" - shame to those who are evil and think). So, there is some ambiguity intended about this character.

Zoe is from the Greek word for life. Simon is from the Hebrew shimeon which means "harkening" or "he heard." Of course, it is always hard to know whether a writer or filmmaker is cognizant of any of these things when choosing names.

Finally, "the Pax" is a term from Latin for "peace." We are reminded very forcefully by this film of the words of Calgacus, who commented on the "Pax Romanus," saying that the Romans "make a desert and call it peace." Troubling developments in international relations make one wonder whether the USA is about to engage in pre-emptive nuclear strikes against Iran, with devastating consequences as China and Russia support their ally against what would actually be USA aggression. The "Pax Americanus" may be a nuclear desert. One only prays there would be someone left to call it "peace."

Free Market Money

      "Experience has shown that what was believed to be the easy way out from the difficulties created by the rigidity of wages, namely, raising the whole national price level, is merely making matters worse, since in effect it relieves trade unions of the responsibility for the unemployment their wage demands would otherewise cause and creates an irresistible pressure on governments to mitigate these effects by inflation. I remain therefore as opposed to monetary nationalism or flexible rates of exchange between national currencies as ever. But I prefer now abolishing monetary frontiers altogether to merely making national currencies convertible into each other at a fixed rate."

      - F.A. Hayek, Denationalisation of Money - The Argument
      Refined: An Analysis of the Theory and Practice
      of Concurrent Currencies
      , 3rd Edition, 1990
      [Emphasis in original]

The geniuses at the Federal Reserve and the other central banks have had a reprieve. They exported inflation.

We can now confidently say that inflation is back. The monetary inflation of the 1970s, predicated in part on the closing of the gold window and substantially on the ever-increasing deficit spending, combined with absurd trade policies and foreign policies which produced ever-widening trade deficits did not result in the final collapse of the dollar. As we've mentioned previously in this newsletter, Robert Landis has identified the nature and extent of that reprieve.

The next step for the central banking scammers is to move from national to super-regional currencies and then to a global currency fraud. Along that path, they've made what may be a fatal error for them and a critical opportunity for us. Currency competition has arrived.

Mind you, I do not, even for a moment, believe that Keynes was serious in his proposals that inflation was stimulating or a good thing. I don't believe for a moment that George Bernard Shaw, Keynes, or any of the other Fabian socialists were in earnest in any of their claims. These people wanted to smash the established order, do away with private property, destroy individual liberty, enslave every human being on the planet, and manufacture a global scheme of totalitarian control. In these efforts they merely joined various Masons and others with schemes for world empire. It's all hogwash.

Free markets work because individuals seek their own self-interest. Free markets work and controlled markets don't because individuals are better suited to seeking out information for their own purposes, finding the best solutions to their own problems, husbanding their resources, and maximizing their benefits. There's no mystery to free markets, there's no magical "invisible hand." Rather, the way markets work has been well understood for hundreds of years, at least since David Ricardo and Adam Smith.

Monetary nationalism, and, indeed, all nationalism is idiocy. People are better off when they are free to choose. Whether they are choosing carpets, watches, channels of information, or what to spend at the cash register, individuals are better off when they have more choices and more freedom to exercise. They are harmed whenever artificial boundaries and conditions are set in their way. Inevitably, people find ways through and around borders, restrictions, and prohibitions.

Unfortunately, after thousands of years of private property, a certain sort of bully has gained enough power to attempt to unleash all manner of chaos and insanity in the name of "law" and surplus order. A recent example comes from New Orleans, where a man was severely beaten by police.

Unlike in other instances with which we're familiar, this particular beating was filmed by APTN which had a producer and cameraman on the scene in moments. The old guy who was beaten up was trying to get information from one police officer about the timing of the curfew still in effect in New Orleans, when another interfered. Reacting negatively to this interference, the man made clear his intention of speaking to the mounted police officer, and was immediately assaulted by the other pig. Then a gang of pigs began beating on the man. During this melee, one of the pigs noticed that they were being filmed and demanded that filming stop. When the APTN producer Rich Matthews presented his press credentials, he was shoved backward over a car and hit in the stomach. The pig who hit him then unleashed a tirade of profanity (and, presumably, vulgarity).

The head of the New Orleans police union said the pigs in question felt they had acted appropriately. "They feel they were justified oink ...in their actions and they were using the amount of force necessary to overcome the situation," Pig Lieutenant David Benelli told New Orleans station WDSU. Evidently, these bullies are unable to tell when they've become brutal. Perhaps a few of them need to be taught lessons with severe corporal punishment, while the rest are chained down and forced to watch.

Unfortunately, it is this very mentality of imposing surplus order to defend against not only real but imagined attacks on the dignity of the state or its enforcers which we face in our economic lives. We already see this sort of brutality meted out routinely against people who buy, sell, and use prohibited pharmaceuticals. We can anticipate new levels of currency controls and a ramping up of the economic prohibitions in response to what is going to be extremely bad hyperinflation.

It won't be possible to thwart trade and commerce forever. However, it is clear that a great deal of pain and suffering is going to ensue as free people struggle to reduce and eliminate economic nationalism, jingoism, and repressive bullying.

We'll continue our focus on Denationalisation next week.

Gold Mining

Here's how the stocks we presently suggest in this area look of late (evening Wednesday 12 October 2005):

Company Symbol

C$

US$

D

Exploring
Almaden AMM.TO

1.88

-

$0.14

Luzon LZN.V

0.115

-

-C$0.175

Pinnacle PNL.V

1.00

-

C$0.37

Western WNP.V

5.25

-

C$3.51

Holding
Lumina Resources LUR.to

0.29

-C$0.46

Northern Peru Copper NOC.to

1.89

-C$0.01

Regalito Copper RLO

-

5.82

$0.92

Silver Standard SSRI

-

13.39

$0.61

Vista VGZ.TO

5.00

-

C$0.00

Mining
Apex Silver SIL

-

15.72

$3.17

Newmont Mining NEM

-

46.02

$2.72

Northgate NXG

-

1.28

- 0.37

Tan Range TRE

2.78

2.38

C$1.78

The news on Western Prospector is a bit odd. We originally encountered them as this nice gold mining company with some work going on in Mongolia. A fabulous place, Mongolia, with a very free market oriented group currently in power. Then it developed that WNP was involved in uranium exploration, also in Mongolia, with excellent success. On that news, the stock hit a triple for us. Very pleasing. Earlier this month, though, as we were putting last week's issue to press, they released news that they are exploring for coal, also in Mongolia. The market seems to have reacted negatively. The good news is that the region they are exploring is very prospective for coal, and they've already found an anomaly worth drill testing this Autumn. The bad news is they seem to be going for diversification in a big way, and that may not be the optimal mining strategy. We'll try to stay on top of these busy mining enthusiasts.

Last week we promised to take a look at GoldCorp, FreePort, Royal Gold, and Barrick. We haven't had the time to make a proper analysis, so we'll look to review them next issue rather than releasing this issue any later. Of these, FreePort might be worth taking on a flyer.

We received a nice video disc from Monex. The disc features a series of interviews with Doug Casey, Jim Turk, the Aden sisters, Richard Russell, Adrian Day, and others. One comment by Jim Turk was to the effect that holding gold is a Warren Buffet strategy; buy something that is undervalued and watch the value unfold over time. This idea is reflected on all of our stock suggestions in the above list. Every single stock now shown has measured and indicated resources on a per share basis which are worth more than the stock's current price, generally by many times; in a few cases by many hundreds of times over.

A comment by Doug Casey from the video and another examination of automobile prices (our Lincoln Crowne Victoria LTD comparison from 1972 to 2002 having appeared on the Monex video in the guise of a Ford Mustang comparison), this time Cadillacs, shows up in our new general interest essay on buying cars.

Free Market Money

The big news in free market money is the Phoenix Dollar. Gordon Hayes released it this week for founding members, so we jumped right in and began clearing exchanges between Liberty Dollars and Phoenix Dollars. Fantastic.

The Phoenix is backed by silver. It is a very well developed currency service. The high level of quality and the care with which everything has been thought through and developed really shine. As a founding member, I received a beautiful embossed certificate, an uncirculated limited edition Phoenix commemorative coin, and a very nice card from Gordon. My account is #6 in honor of "The Prisoner." Which of course begs the question, "Who is Number One?" That would be telling.

One of the interesting features of the currency is the opportunity to be verified and thereby participate in the reputation system. Another unique feature is the ability to attach advertisements to currency so that money tells a story while it circulates.

Another new currency out this week is Liberty Reserve. We plan to review it in some detail in our next issue, later this month. On information and belief, it is a dollar transfer system.

Gold buyers and sellers are still duking it out. Last week we saw gold rise to tap $480 before falling back to $463 and close at $469.50 for the weekend.

Dow stocks lost ground. The Dow:Au ratio was down on Friday's close to 21.91. Oil was $64.20/bbl, and it takes 7.31 barrels to buy an ounce of gold.

Silver has run up to $7.80/ounce. The Au/Ag ratio is down to 60.19. Silver is still under priced at this level, and should go higher in the next few weeks. I would suggest continuing to acquire silver until the ratio hits 50. We'll take a closer look then.

Copper rose to $1.87 last week and is now $1.8749/pound (Monday 17 October 2005). Tonnage has been coming back out of the warehouses.

Zinc is up again to $0.6827/pound. That's a new high for the current five year period. Warehouse inventories are falling again. They were lower in 2001, but crossed above their current level in early 2002 and have not been this low since then. The premium on pre-1982 pennies is just 24.5%. The metal in $30 face value of pre-1982 pennies is worth over $37.33.

Nickel metal was $5.8106 the afternoon of 17 October. It seems likely to fall further.

U3O8 was $33/pound as reported from 10 October.

Schlumberger was $83.45 on the open 17 October. Up $1.23 since our suggestion.

The four free market money stocks we've suggested in this sector are PVH, GBH, CGB, and MCG. Prices from Monday 17 October 2005.

Company Symbol gAu
D
Cyber Gold Bank CGB 0.137

+0.031

Gold Barter Holdings GBH 0.156

- 0.844

MicroCasino MCG 0.834

+ 0.321

Pecunix Venture Holdings PVH 0.028

- 0.022

Cyber Gold Bank is up nicely, as are the other stocks slightly.

The Gold Casino last sale was 105 grams of gold per share.

Space Frontier

      "Our estimate is that around 2007 we will be able to achieve extravehicular activity by our astronauts and they will walk in space."

      - Tang Xiangming, Director, China Manned Space Engineering Office, 17 October 2005

China's second manned mission into space put two astronauts aboard a Shenzhou space capsule into orbit and ended with a successful pre-dawn landing today. Fei Junlong and Nie Haisheng, known in Chinese as yuhangyuan, or "travelers of the universe" survived in good health.

Various nationalist and pro-communist party sentiments were publicized. While the technical challenge of putting a couple of men in Earth orbit is presently beyond any free market companies, a number are catching up fast. Meanwhile, China is positioning itself to provide re-supply capabilities to the internationalist socialist space station, or their own brand of space tourism services.

So far, the only entities with orbital space capability are the governments of Russia, the USA, and China (in chronological order by date of first manned spaceflight). Russia has put the most people in orbit thus far. Russia and the European Space Angecy are developing a manned space vehicle which might be launched by Ariane 5 in a few years.

My first encounter with Chinese launch capabilities was back in 1986. Deke Slayton came to my office with some fact sheets on the Long March launch vehicle which he wanted me to catalog. At the time, I was the keeper of the launch competitors catalog at Space Services Incorporated. I was impressed both with the launch capabilities of their vehicles and the pricing strategy that the Great Wall Industries company was pursuing.

A few years later, in 1990, I was serving on the board of directors of the National Space Society (NSS), having been elected to represent one of the regions. I was horrified to learn that the board of directors had been bypassed in a policy directive causing thousands of dollars to be spent to draft an anti-dumping claim against China for selling low cost launch services to Arabsat. Since the management of NSS had managed to embarrass me personally and professionally, and since they had come out against cheap access to space, I promptly resigned in protest.

Since 1990, China has embarked on a manned space program. They began in 1992 with research and development. Looking at the effectiveness of the Soyuz program, the Chinese deliberately patterned their Shenzhou capsule on the Russian launch capsule. They also bought Russian technology for life support systems, spacesuits, and other equipment. However, these have all been reverse-engineered, and all the Chinese space missions have used all-Chinese-made stuff, with some improvements and variations.

Not breaking any records, the current flight lasted 115 hours, 32 minutes. The previous, and first of its kind, flight of a Chinese cosmonaut was in 2003 and lasted only 21.5 hours. The current flight cost $110 million - also not breaking any records.

NASA delenda est.

SpaceDev opened at $1.57 on Monday 17 October 2005. It was up seven cents from our first suggestion.

We discussed shorting airline stocks. To paraphrase Jim Rogers from the November 2004 New Orleans show, nothing goes up quite as fast as my shorts. Delta Airlines was so far down that it de-listed from NASDAQ and now appears pink sheets. It opened Monday at $0.60, down 30% from our first suggestion. America West doesn't seem to be trading. LCC was $22.08, down eight cents from last week, but $1.58 higher than our first look. JetBlue is going well at $19.77. Continental, AirTran, Southwest, American all higher. United was off 3.5 cents from last week. So, as strategies go, shorting the airline stocks only makes sense if oil is going way up. Given that oil is still lower than its previous peak in the early 1980s on an inflation-adjusted basis, we suspect that this strategy will work. It just isn't universal to all airline stocks as yet.

Launch Technology

It's funny, really. You have to see the humor in it. You simply cannot fail to see the humor in it, because if you won't look at the humor, all you can see is the terrible, mind-wrenching, awful, bloody, desperate, deadly tragedy. It is either incredibly silly, as a thing to say, or it is incredibly, terribly heartless, cruel, and malignant as a thing to say.

You see, if we take one catastrophic failure in two thousand, and we divide by ten, we should get one (ONE and only one) catastrophic failure in two hundred. Not two in one hundred, but one in two hundred. You see the difficulty?

The so-called "return to flight" in July 2005 was STS-114. Now, believe me, I know that NASA never numbered these missions sequentially after number 9 until number 62. As you'll recall, the Challenger mission was numbered 51-L. Mission STS-61M seems to me to be the 63rd mission, which makes STS-62 the 64th mission, assuming all the missions with designators actually flew. This accounting would make STS-114 the 116th mission. Now, there have been two catastrophic failures, with total loss of life, killing 14 astronauts altogether in the shuttle program. Those missions ended the careers of many individual astronauts and utterly destroyed the Challenger and the Columbia.

If I've misunderstood their numbering scheme, and STS-114 was actually the 114th launch, it doesn't really matter. The failure rate is 2/116 = 1/58. One failure in 58 flights. So, a tenfold improvement would be 1 in 580 flights.

Mind you, I recall NASA claiming that the chances of a shuttle failure were one in 100,000 back in 1985. I well remember NASA claiming in 1972 that they would build a fleet of ten orbiters, that there would be a hundred flights per year, and that the cost of reaching orbit would be reduced to $100/pound from the Saturn V rocket's impressive $1,000 per pound. Instead, the shuttle has proven to be more than ten times as expensive, or $10,000 per pound, possibly much more depending on what costs you want to bother looking at. I tend to like to look directly at all the costs, and I believe the sum of NASA's annual budgets from 1972 when the shuttle was first authorized to 2005 when the 116th mission flew has been on the order of $364 billion.

Now, some of that stuff is not shuttle program costs, of course. But, the shuttle program only exists because NASA itself exists; eliminate NASA and the shuttle program goes away forever. NASA itself is a political pork barrel project, so the existence of NASA is dependent on having field centers in Ohio and Maryland that contribute very little to the shuttle program, and nifty robotic missions to Mars, and all kinds of other things. Without all these programs and projects, subcontractors in every single Congressional district without exception, and attempts to allay the suspicion of space enthusiasts that NASA is in it for the corrupt allocation of contracts and doesn't care if nobody ever flies in space again, NASA would not have the political capital needed to keep going. So, the whole budget is shuttle-related, in a political as well as an economic fashion. Which means that each shuttle flight costs about $3.6 billion, or around $69,000 per pound to orbit based on the re-reduced shuttle capacity after the second catastrophic failure.

Now, look, I expect NASA to lie to me. Really, it is what they've done since at least 1972. They lie, and to deal with the exposure of one set of lies, they make up another. But, you'd think that they could come up with some numbers that suggest an acquaintance with their own flight history, a passing familiarity with mathematics, and a rudimentary acquaintance with really simple operations like multiplying by ten. Since the shuttle has failed catastrophically not less than twice in 116 launches at most, it stands to reason that its failure rate is either one in 57 (in the case of 114 flights) or one in 58 (in the case of 116, as I count them). So, a ten-fold improvement is nothing like one catastrophic failure in two thousand. It isn't even on that same order of magnitude.

Mr. Hedman's point, and it is a good one, is that the estimate of one catastrophic failure in two thousand when the new crew exploration vehicle system has not even been put through critical design review, let alone built, let alone flown even one time, is just a nonsense number. It has just the same usefulness as an estimate that those really daring figures that Spock would toss out in classic episodes of "Star Trek" would have. Captain Kirk would ask, "What are our chances, Spock?" And Spock would reply with some number like one in 7,594. Off the top of his head, as though he had been doing the calculations the whole time. And updates would sometimes arrive. Really, it was terrific fun. But, as Hedman notes, it was just a television show, it was just fun with numbers. Nobody could take those odds seriously, especially when the characters kept defying the odds.

So, Hedman is justifiably disheartened that NASA has the audacity to put forth this sort of estimate of how often they will catastrophically fail and, presumably, kill an entire crew of astronauts. Me, I'm upset that NASA can't seem to keep track of how many times they have flown or attempted to fly, and how many times out of those attempts they have utterly massacred the entire crew of a shuttle. It is beyond my comprehension how people so obviously inept at math and statistics are allowed to manage a budget of some ten or fifteen billion dollars annually.

Then comes worse news, this time from one of the all-time great NASA watchers, Keith Cowing (who has never admitted that NASA ought to be destroyed, but has identified many problems within its fetid hallways and basements). Keith says that one of the two alternative approaches to budgeting for future shuttle launches, the default and only serious alternative under discussion, limits the shuttle program to two flights per year, with 8 missions total to fly before the fleet is retired. Seven would service the internationalist socialist space station, and one would service the Hubble space telescope (the acme instrument of socialized space science and astronomy).

There are a couple of pretty major policy implications of this flight schedule. First, that small a number of flights to the space station means that Russia would have to be called upon for additional crew transport services. Apparently, the Iran Nonproliferaton Act currently in place or under serious consideration is to punish Russia for supplying nuclear reactor technology for the peaceful nuclear power industry in Iran which, shades of "Saddam has weapons of mass destruction" is the current cause celebre soon to be a cassus belli coming to a war zone near you. (Remember the richly detailed nightmares of Russians nuking the USA we all enjoyed from circa 1949 to 1991? I do. If Iran is attacked, and Russia is being punished for supporting them, what happens in the event the USA goes ahead with first strike attacks against Iran? Does Vladimir Putin take a strong dose of Enditol? Stay tuned for Titanomachia Part Three.) Part of the punishment in the Iran Nonproliferation Act seems to reduce the number of Russian flights with NASA astronauts in a typical, "I'll shoot him!" approach as seen in the film "Blazing Saddles."

So, actually, that sounds kinda good, we might get some better relationship between the USA and Russia as a result of this totally "inadequate" shuttle flight capability. Russia has to know they are in the driver's seat, so they can play with this political football a bit. If that ends up postponing indefinitely the USA attacks on Iran, good.

The other result is nearly as delightful. All the other international partners, including Japan and the European Space Agency, have been waiting their turns for their space station modules to be flown on the shuttle. The seven flights to the space station would all have to be for logistics purposes. The space station assembly flights would all be cancelled. More than twenty years after President Reagan asked the non compos mentis (aka nincompoops) at NASA to build a space station and get it done in a decade (for an original planned expenditure of only $8 billion), NASA is about to propose a shuttle flight schedule for 2007 and beyond that halts the space station assembly program and effectively curtails its usefulness to all the international partners - except Russia which should be able to fly Progress re-supply and Soyuz space tourism flights until nuclear winter severely reduces global prosperity.

Why do I regard this result as delightful? It ought to severely curtail one of NASA's repeated excuses for being minimally competent but still getting to waste ten or fifteen billion dollars a year. (Really, it has been something in that range for quite a while, and I just can't bring myself to look it up. It's all so...tawdry.) That excuse has been that the shuttle program and internationalist socialist space station are good diplomacy. Foreign astronauts fly on the shuttle, fly to the space station, and technology and ideas are shared. Yay. But, the story overseas is told with a frown and a different point of view.

See, the European Space Agency, Japan, and to some extent other countries, have been disappointed working with NASA on other joint projects. NASA keeps shifting its priorities, and cancelling its commitments. For example, just one of dozens, NASA was supposed to build and fly a Solar Polar Orbiter. The European Space Agency built and flew the Ulysses Solar polar orbiting spacecraft. But, without the American spacecraft, it wasn't possible to fly over both poles at the same time and measure what was going on at both poles simultaneously. In other words, more than half the scientific value was lost.

So, the good news is that NASA won't be able to trot out its diplomatic relations excuse. Instead, NASA has been provably disastrous for international relations. NASA has deliberately slighted international partners in project after project, insulting and in at least one case killing visiting astronauts. (Columbia went down with that Israeli gentleman on board.) If there is much justice in the world, which diplomats tend to disprove, NASA will find it hard to get any other country's space agency to sign up for another betrayal.

Now, as Keith points out, there is a plan B. The plan B plan is to do what NASA always does: pretend to cut costs by merging operational groups. Keith is the good kind of reporter, the kind that has the ability to remember things from one week to the next. In this case, he brings up the excellent point that NASA has previously proposed to save money by cramming space shuttle and space station operations into one operations directorate, then split them apart, then put them together. Now NASA administrator Griffin (buffoon) is proposing to jam the "space operations mission directorate" together with the "exploration systems mission directorate" staff and organizations - to make it possible to fly more shuttle missions, with shuttle derived heavy lift vehicles spontaneously developed and operational.

Does it bother anyone else that the Directorate which followed the National Assembly in France was responsible for some of the worst excesses of the Reign of Terror from 1793 to 1797? The National Assembly's assignats were hyperinflationary, but the Directorate's mandats were, even more so. Moreover, the Directorate enforced the "Law of the Maximum" price controls, to the point of executing at the guillotine many dozens of merchants, and condemning to death tens of thousands of French people who were unable to buy food because of these disastrous economic policies. It bothers me, and whenever I see NASA using terms like "directorate," that's what I always think about. The term "mandate" always reminds me of those mandat notes that proved so immediately worthless.

What should we expect from these buffoons? Well, I'm not a betting man. But, I don't mind setting odds or holding the purse, for a fee. If you want to bet that NASA puts men on the Moon again before 2020, I want to see your calculation of the odds. Remember, these people are still running aircraft tests in Ohio; they still have a space flight center in Maryland that doesn't fly anything; they haven't figured out how to combine Johnson, Marshall, and Kennedy space centers into just one actual space launch center.

Not only does eliminating NASA's budget trim ten or fifteen billion dollars from the current budget, and every year thereafter, but the states could buy the space launch centers in Virginia (Wallops), Florida (Kennedy), and Alaska (Poker Flats) or these could be sold off to the private sector. Many of the space center buildings could be sold to the private sector. Rice University has a claim on the Johnson space center grounds which they contributed in the early 1960s with the caveat that if the government stopped flying men in space, Rice gets that campus. Like the concentration camp museums in Europe and Siberia, one could turn the other NASA facilities into privately run museums of the idiocy of centralized nationalist socialist space policies. So, there are billions of dollars of budget savings and billions more in asset sales.

Really, NASA should be eliminated. Moreover, it should be done for the sake of the children. Will no one think of the children?

NASA delenda est.

New Country Developments

      "We all desire happiness and wish to avoid suffering. Ethical conduct is ... something we engage in because ... like ourselves, all others desire to be happy and to avoid suffering. Given that this is a natural disposition, shared by all, it follows that each individual has a right to pursue this goal."

      - the Dalai Lama, Ethics for the New Millennium

China is a strange place. Over the last few thousand years, it has been the birthplace of pasta, advanced fortification design, ideograms and the movable type they demand for ease of reproduction, enormous fleets of exploratory sailing vessels, gunpowder, hyperinflationary mulberry bark paper money, isolationism, and a number of interesting philosophies, including Confucianism, Shao Lin variations of Buddhism, and the war artistry of Sun Tzu. Advanced fighting techniques from Korea, China, and Japan all have claims to early development, but kung fu is certainly one of the earliest.

Like all places with substantial territories and populations, China is a labyrinth of contradictions. Free expression, the entire idea of a printing press for which we have the term "freedom of the press," and the Reformation which swept Europe into deadly religious schisms in the 16th and 17th Centuries owe much to Chinese technology. Simply put, Gutenberg adapted the printing press from technology that had been well developed in China, made it work with Western characters, and began a long string of innovations in typesetting that has culminated (for now) in the universal hyper text mark-up language (html) and the highly automated computer printing languages used to make this newsletter possible.

And, on the flip side, China has a brutally repressive government which punishes people who express themselves, censors the Internet, very likely would not make this web site available to its residents, and is well-known for running tanks over and massacring thousands of protestors in Tianenmen Square, imprisoning dissidents, brutally repressing religions like Fulon Gong or Christianity and generally running roughshod over human expression. Something on the order of 80 million Chinese died in death camps, were tortured to death in prisons, or were worked to death in labor camps under Mao.

China has had its expansions. After the Mongol Khans conquered China, they set their sights West and conquered one country after another until they reached the Caliphate, which they sacked and destroyed in the 13th Century. The Mongols had conquered the Turks of the Turkmenistan region, brought them West, and laid the groundwork for what quickly became the empire of the Ottoman Turks.

As we've mentioned here previously, the Christian West owes a very great and unpaid debt of obligation to the Caliphate for absorbing and blunting the attacks of the Mongols and their "Golden Horde." It was not the Caliphate that rampaged across eastern Europe and reached the gates of Vienna in the late 17th Century, but the Ottoman Turks. It was not the Caliphate, a trading empire whose days of conquest were long past, but the Ottomans that taught colonialism and all its terrible lessons to the Europeans. African slavery certainly existed in previous centuries, but was greatly expanded and the export trade first became widespread under the Ottoman empire.

Having absorbed the Mongols in the Fourteenth Century, the Mandarin-dominated culture of China then turned against the Imperial Navy which had been sailing enormous exploratory vessels to various neighboring countries, which certainly brought back giraffes, other animals, and plant specimens from Africa and possibly explored the West coasts of the Americas. The Mandarin bureau-rats turned against the fleet, a new Emperor had the fleet and its records destroyed, and the Middle Kingdom turned to isolationism.

One of the reasons China became many different countries in the 18th and 19th Centuries was this flawed policy of isolationism. So, the European colonial powers from Portugal, Holland, and Britain began to carve territories out of neighboring countries, then out of China itself. Sadly, these exercises in colonialism and the related economic policy of mercantilism resulted not only in thriving free ports like Hong Kong (a product of the Opium Wars that were settled in Britain's favor by the Treaty of Nanking), Macao, and Shanghai, but also inspired the Empire of Japan, when it was roused from a long sleep of isolationism by Admiral Perry in the mid-19th Century, to much more brutal depredations in Korea and Manchuria.

The lessons of imperialism, colonialism, native enslavement, and mercantilism were brought West by Mongols and Turks, encouraged European imperialists who occasionally muted some of the most brutal elements (though, in the case of Spain's empire, not often), whose work was taken up by the Union army in the Confederacy and then in parts of the Spanish empire after 1898, and ultimately taught to Japanese. The Japanese learned at the knee of American and European imperialists, discarded all of the dandified rationales against brutality, raped Korea and Manchuria, and were sweeping all the European colonies into their "Great East Asian Co-Prosperity Sphere" during World War Two - making a sort of bonfire of the old imperialist systems - when their excesses were confronted and, to an extent, replaced by American militarism.

Meanwhile, China did what it always does. It reconsolidated. Emperor Mao established a territory in northern China during the Japanese occupation, formed alliances with the Soviets and certain communist infiltrators in the USA State Department, and expanded both during and after the war. Chiang Kai-Shek and the Nationalists chose an inflationary financing path, were largely abandoned by the USA in post-war China, and ended up on the island of Taiwan in 1949.

Shanghai was swallowed up by the Japanese Empire in 1941. It was briefly liberated under the Nationalists, and then swallowed again by emperor Mao after the war. Tibet was betrayed and absorbed in... and Hong Kong was betrayed in the post-Falklands talks by a British government that became convinced they didn't want to defend territory ceded to them in perpetuity by the Treaty of Nanking, having paid a heavy price for the Falklands.

Contemporary imperial China still has the forms of the communist political party apparatus, but has entirely embraced the Western economic system. The good news is that entrepreneurship and economic liberty have been encouraged. The bad news is that the military and political hierarchy remain dedicated to repression and brutality. Imperial China has a number of autonomous regions, including Inner Mongolia (Nei Mongol Zizhiqu or near Mongol autonomous region), Tibet (Xizang Zizhiqu), Xinjiang Uygur Zizhiqu, and Hong Kong which is more of an autonomous city. Economically, the post-1997 result has been that Hong Kong's trade and commerce systems have taken over the rest of China. Politically, the free speech and freedom of conscience rules which still prevail in Hong Kong are not likely to last, nor spread any time soon.

For 24 October, we'll take a longer and harder look at the Portuguese colony of Macao. Then a good serious look at Taiwan, a new country since 1949's flight of the Nationalists turned into a bizarre Western policy of recognizing the Republic of China but not the People's Republic, followed by an equally absurd policy of refusing recognition for Taiwan but accepting the existence of the PRC. A new country developments look at China wouldn't be complete without examining Tibet, which we'll take up after we return from FreedomSummit.com. Finally, we'll take a look the long disputed border between India and China, including Bhutan, Nepal, and those funny enclosed disputed regions in the Karakoram range. Then on to the lesser known "Stans."

Longevity

A study presented at the 96th annual meeting of the American Association for Cancer Research back in April (presumably the proceedings for which were recently published) has revealed some good news for men with a family history of prostate cancer. Green tea extracts, including those found in inexpensive supplements, can be very useful in preventing the progress of the disease.

The study was conducted in Italy by S. Bettuzzi, M. Brausi, F. Rizzi, G. Castagnetti, G. Peracchia, and A. Corti. I heartily dislike the short shrift that authors are given in the citations of these studies. It seems to me that the people doing the investigations should be given thoroughgoing credit for their work. Indeed, I have found even worse instances in studies conducted by governmental agencies, such as NASA *spit*, wherein the authors are entirely unnamed. Disgusting.

In this case, the study involved 62 men, each with high-grade prostatic intra-epithelial neoplasia or PIN. PIN is a pre-cancerous condition. As indicated in the quote above, the progression from PIN to frank prostate cancer is about one-third per year. Of the 30 men who received a placebo, 9 men, or 30%, progressed to prostate cancer within a year. So, we can see that this sample was reasonably representative of the population as a whole. (It may be that by being in a study group, the men were more concerned with their health, or felt they were getting real treatment. So, one would certainly expect at least a small decrease in incidence from such effects.)

The really interesting news is on the 32 men who were given 200 milligrams of green tea catechins orally three times a day for one year. Repeat prostate biopsies were performed on all participants six and twelve months after beginning the study. The result for the study group was a reduction to 10% of the incidence of the control group progressing to cancer. Very impressive.

More specifically, the men receiving the supplement got a total of 600 milligrams of green tea catechins daily. The polyphenol epi-gallo-catechin-3 gallate or EGCG accounted for about half the catechins. The researchers conclude that green tea should be recommended for high risk populations such as the elderly, African-Americans, and men with a family history of the disease. Green tea catechins are inexpensive, well-tolerated, and non-toxic to normal cells.

Two obvious questions. First, why the continuing focus on prostate cancer? It is the second leading cause of cancer-related death among American men. I have a family history of the disease, so I'm at risk. Also, because prostate cancer is widespread, treatments which are effective against it ought to be useful in combatting other cancers. Indeed, other studies have shown that green tea catechins and other polyphenols inhibit certain cancer cell lines.

The other obvious question is: what does "catechin" mean? The term comes from the plant compound catechu, a water soluble, resinous, astringent used in tanning and dyeing. Catechu in particular is derived from the Acacia catechu in Southern Asia. Presumably, green tea catechins are chemically similar. Another term would be "flavones."

FDA delenda est.

Legislatura delenda est.

Here's how our stock suggestions in the nanotechnology and life extension sector look right now (evening Wednesday 19 October 2005).

Company Symbol US$ delta
CytRx CYTR 0.92 0.02
Accelrys ACCL 6.99 -.19
Dendreon DNDN 6.11 0.79
Elan Corp. ELN 8.03 0.80

Accelerys is down. It closed on Tuesday just a penny off our initial suggestion, and dropped a further 18 cents today. Yesterday after the close, the company announced appointment of a senior marketing guy.

We casually mentioned the idea of shorting Pfizer and other major drug makers at the end of May. Pfizer was $23.97 on the 19th, down 15.48% since our suggestion. Merck is off 15.88% in the same period.


Publication Note: We broke the schedule by not completing last week's issue on time. Fortunately, there was a hole for this week, so we should be close to on track next week.

Consider encouraging your friends to sign up for The Indomitus Report. We are prepared to pay a 10% finder's fee to anyone who brings in a trial subscriber or annual subscriber.

Gratuitous example of bizarre legislation: H.R. 554, the "Personal Responsibility in Food Consumption Act," makes it illegal to bring a lawsuit against purveyors of cheeseburgers if you gain weight, unless the sellers broke some state or federal law. Huh. And, with this one act of legislation, passed 307 to 119 today (19 October 2005) the House ushers in a new era of enthusiasm for individual responsibility. Perhaps next they will rescind the idiotic laws which prevent individuals from keeping and bearing arms on airplanes.

There were two news reports of some interest. Rioting in Toledo, Ohio this past week would seem to be racially motivated. Combined with the unrest in New Orleans, it is indicative of a higher point on the rebellion trend. Something to watch.

The other news of note was inflation. September wholesale prices were reported on Tuesday 18 October 2005 by the liars at the Department of Labor. They are willing to admit to 1.9% inflation for September, which works out to 22.8% inflation per annum. Consumer prices were earlier reported rising by 1.2% in September, which is 14.4% annual inflation. Gasoline prices jumped by 17.9% in September. Of course, the "core rate" of inflation exempting food and energy was only 0.3%, but, so what? Try living without food or energy for a year. With eleven interest rate hikes and inflation running over 22%, it is clear that the Federal Reserve is going to hike higher and faster, while printing money on the back end.

We've added ... to our collection of reports.


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