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The Indomitus Report
Volume 3, #2

27 February 2006
The Effusion of Blood

Being Sovereign

      "Murfreesboro, 13 July 1862. Colonel - I must demand an unconditional surrender of your force as prisoners of war, or I will have every man put to the sword. You are aware of the overpowering force I have at my command, and this demand is made to prevent the effusion of blood. I am, Colonel, very respectfully, your obedient servant, NB Forrest, Brigadier General of Cavalry, CSA."

      - Nathan Bedford Forrest

Time and time again as he waged war in the West, Nathan Bedford Forrest would send the same message. Invariably he would claim overwhelming force, whether he was outnumbered by a factor of two, four, or ten. Sometimes, to bolster this claim, he would have his men circle some nearby item of geography mounted, then dismounted - the same men posing as cavalry and infantry.

In one case with but a single cannon in his train, Forrest had the men bring it past a nearby hill, then back around behind. This activity took place while he was confronting an enemy officer under a flag of truce. According to an aide who later wrote about the incident, the Yankee officer's eyes grew wider and wider.

Finally, as Forrest finished reviewing his requirements for surrender, the enemy officer spoke up. "That is the twenty-seventh cannon I've seen brought round the hill behind you. With such artillery, you could level our fortifications and slaughter the last man." Surrender was prompt and complete.

But the essential appeal was to avoid the massacre that would be inevitable in the event of battle. Forrest never said whose blood would be spilled. His reputation for victory was widespread, and his requests for surrender often met with a positive response.

Recently, a correspondent wrote to say that he was surprised by the gun confiscations in New Orleans, and the lack of reported resistance. No doubt, all the tales have not been fully told, and armed resistance may well have been met. Then he wrote that he'd like to see the government try gun confiscations in Wyoming or Montana.

Without hesitation, I wrote back that I would not. I would not like to see a clash between the armed men and women of the West and the troops of the government of the east.

Don't forget, I wrote, that these men are our brethren. They were once our countrymen. Any single one who must be killed to preserve our lives, liberty, and property is an American.

Since about 1972, I've studied the battles of the War for Southern Independence, including the conflicts in "Bleeding Kansas" leading up to war and the actions during Reconstruction after. To this day, that war shed the blood and ended the lives of more men in battle than any other war in which Americans have fought. Six hundred thousand died, and one million twenty thousand were casualties, dead or injured.

Given the severity of the wounds received, in many cases those four hundred twenty thousand men were nearly dead. Amputated limbs, surgery without anesthesia, infections without antibiotics. The suffering of the wounded was often greater than that of the dead. In many cases, survivors were unable to hold regular jobs, and whiled away their final years in poverty and misery.

Nor were the civilians left in peace. Entire cities were laid waste - Vicksburg, Atlanta, Charleston, many others. Crops and livestock were seized or destroyed by both sides. Women, children, the elderly and the infirm, free and slave, were robbed, beaten, raped, and murdered by both sides - though the experience of Pennsylvania in Lee's invasion of 1863 culminating at Gettysburg illustrated that the South was far less rapacious in conquest than the Unionists.

To what end? Jeffrey Rogers Hummel makes an excellent case that Lincoln was a socialist bent on forming a government of absolute power. Lincoln would tear off the manacles of limited power. The South would not agree, and seceded - with the full authority of the Tenth Amendment.

For issuing greenbacks and defying the banking cartel, Lincoln had to die. For supporting Lincoln by sending his fleets to support the blockade, the Czar of Russia's family would later be exterminated by the banking cartel. Ultimately, the War for Southern Independence was a war of resistance against the banking cartel's power, corruption, decadence, and putrescence. The ultimate victors were the bankers and the vile socialist slime that cling to them, bleating for crumbs from the table.

Within a generation, the minting of silver had ceased and the bankers were controlling the gold. Within two generations, the Western frontier was closed, the income tax had been imposed, Prohibition was creating a national police force and organized crime, and the Federal Reserve had stolen the issue power of money. Worse, the entire world was swept by a war which destroyed most of a generation, paused for twenty years, then destroyed tens of millions more, went cold while over a hundred million were worked to death or tortured in slave camps.

Finally, in 1991, that multi-generational war ended. Hundreds of millions of men, women, and children have been slaughtered worldwide to slake the blood thirst of bankers, and they are still not satisfied. They crave world domination, a unified governmental authority they can corrupt and direct, the enslavement of the entire human population, and the ownership of all land, resources, and property. For this sin of covetousness, for the murders of hundreds of millions, for their corruption and decadence, the banking cartel must be brought to justice.

But the effusion of blood is not the best way to peace or justice. To avoid the effusion of blood, we should do whatever else we may which is within reason, dignity, and morality. There is something we can do, and we should.

In a very fine film starring Dan Aykroyd and Eddie Murphy, two evil old investment bankers contrive to experiment on the lives and fates of a poor black street scam artist and a rich white investment banker, the nephew of the elderly men. In "Trading Places," the two young men discover the plans against them, and a plot to corner the market for frozen concentrated orange juice. Then, in a series of Candide-like maneuvers, they make their own fortunes while crushing the old men.

In the climactic scene, Eddie Murphy explains that he and his friend had learned of the experiment, and had contrived one of their own. They decided to see if they could become fabulously wealthy and at the same time avenge themselves for the difficulties caused by the old guys. How to make rich people suffer? By making them poor.

The banking cartel and the military industrial complex are the same thing. Since at least 1819, the directors of the central bank of the USA and the heads of the major defense contractors have been the same men. Today, they finance wars and find enemies to maintain their grip on power. But, like a fist holding water, the more they tighten their grasp, the more people slip through their fingers.

Free market money is not just about saving your nest egg. It is not just about your wealth, your property, your posterity. Yes, it is certainly about those things, and those are important matters. Don't confuse altruism with self-sacrifice. You need your wealth and your property to defeat the banking cartel and make the most of the future.

The free market is the only workable alternative to a command economy. Fiat money inflation is spiraling out of control, and as the Federal Reserve stops publishing first one measurement (Liquidity - L - 1998) and then another (M3 money supply - 2006) it is clear that these men are becoming desperate. It has been thirty-five years since the last tie to gold was broken, and the bankers have used up all their tricks.

They have tried wage and price controls under Nixon, deficit spending under Reagan, the export of dollars all over the world for twenty-six years, and always printing, printing, and more printing. The computer revolution has allowed more money to be created by stroking a few keyboards than was ever printed. Derivatives and complex financial arrangements, some exposed in the Enron scandal, have been used to build pyramidal superstructures atop the mountain of debt. It is all coming tumbling down.

You'll live to see it. You'll see some of the worst of it in the next few years. The coming collapse of fiat money - not just the dollar but the euro, the yen, the ruble, the pound - will create economic hardship like you've never seen. Witnesses to the Great Depression who survive today will look around and see even greater misery.

Unless one simple thing is done. If we make use of the tools at hand, we can avoid the worst effects of the collapse. If we remove the issue power of money from the banking cartel monopolists and their stooges in the government, and take it back into our own hands, we may at the same time preserve our own wealth, establish the greatest cornucopia of prosperity ever seen, and extricate ourselves from global debt, while curbing the military industrial complex, plucking its fangs, and putting it back in its cage.

This work may proceed very rapidly. Already, we have seen exponential growth curves in the free market money industry. The volume of money in circulation and the number of users is growing rapidly. The international aspects of the monetary system combined with the dramatic powers of inter-networked computer systems and powerful encryption techniques have provided the necessary and sufficient conditions for an out of control free market blossoming.

This one tool is better. Free market money makes people more free. It makes it harder to control them or steal their property. By enhancing their freedom, free market money enhances their prosperity. And by curbing the ability of governments to finance endless wars and endless programs of wealth redistribution, free market money starves the monster into submission until its muscles atrophy and it can be led back into its cage and bound down by the limits of constitutions and sterner stuff.

Since 1860, we've seen 146 years of war. We've seen deceitful men luring free peoples into war with frauds: the USS Maine fraud, the Lusitania fraud, the Pearl Harbor fraud, the Gulf of Tonkin fraud, and more recently the 11 September 2001 fraud. Whether by deliberately sending civilians and troops into harm's way, or by carefully removing all safeguards against attack, or simply forging the evidence, the powers that be have promulgated war after war after war. Their lies add to the toll of sin, justify the destruction of lives, and mask their greed.

All that is needed to stop their evil is mastery of yourself. Issue your own money, or choose a free market money when you offer tender in payment or accept it. Simple. The alternative is rioting, rebellion, revolution, massacres, and endless war. Take heed. You have a choice to avoid the effusion of blood. While you have that choice, use it.

Free Market Money

      "Silver has become too valuable to be used as money."

      - Lyndon Baines Johnson, 1964

LBJ was a liar. He sent men to die in the jungles of Vietnam, knowing full well that the Gulf of Tonkin incident was a lie. He profited from the war through his cronies. He promoted an endless war in Asia, propping up a mad Catholic dictator who persecuted Buddhists. His escalation of the war necessitated the development of the Ho Chi Minh Trail which, in turn, led Kissinger and Nixon to the illegal bombing of Cambodia.

On 4 June 1963, JFK signed executive order 11,110 in the series dating back to 15 April 1861 when Lincoln broke with the constitution and signed executive order number one. Kennedy's order 11,110 is still on the books, and still provides the USA treasury the power to issue silver certificates and coin silver money. Two and five dollar denominations were printed during the remainder of his presidency, and ten and twenty dollar denominations were being printed when he was assassinated.

To vex the banking cartel further, Kennedy was evidently preparing to pull all American troops out of Vietnam by 1965. Moreover, speaking at Columbia University on 12 November 1963, Kennedy said, "The high office of the presidency has been used to foment a plot to destroy the American's freedom and before I leave office, I must inform the citizen of this plight." Ten days later, he was dead. Johnson was sworn in as president.

Whether his own Praetorian Guard assassinated him, possibly with so direct a means as having the driver of his limousine turn around and shoot him with a .45 caliber pistol that some people say may be seen in the reconstructed Zapruder film, or whether a very strange man (who would later be shot before being tried) armed with a bolt action Carcano was able to rapid fire shoot up his limo with, among others, a magic bullet that made several stunning changes of direction as the Warren Commission would have us believe, it remains that Kennedy was shot to death.

Within a year of his death, silver was removed from the common coin of the United States, and the greatest debasement of currency in the history of the world was begun. Had silver become too valuable to be used as money, or was the money supply under Johnson too huge to maintain the exchange rate from the world spot silver market to the dollar? Fairly obviously, the monetary inflation of the dollar was about to exceed all previous bounds of rationality.

Moreover, under Johnson, all possibility of withdrawal from Vietnam was eliminated. Johnson agreed to become unelectable in 1968 on account of his idiotic handling of the war. Across the Atlantic, foreign minds, cool and unsympathetic, took note of these two events, and began to act.

Who knew better than the French what a perfect tar baby Vietnam would become? They had seen French Indochina take the best of France's youth. As Vietnam held the French close, it became increasingly difficult to extricate themselves. Finally, they turned the whole mess over to the USA. Seeing that the idea of holding Vietnam closer was the determined policy of LBJ, and seeing that he had already debased the coinage, the French knew that enormous costs were going to be imposed. The dollar would have to inflate to pay for the war in Vietnam, the Great Society war on poverty, and the imbecilic centrally planned space program.

Seeing this willingness to pursue a policy of monetary inflation diametrically opposed to Kennedy's sound money policy and seeing an escalation of war costs and other government programs, the French knew that the dollar was doomed. They were determined to get out while the dollar was still redeemed for gold.

Thus began a great monetary battle. Americans could not own gold, had not been allowed to since 1933, so they mostly watched from the sidelines. Europeans were the major players, and began to send their dollars to be redeemed at thirty-five to the ounce. Gold began to flow out of Fort Knox and other Treasury vaults. The price of gold on the world market began to rise.

Before Nixon would repudiate Bretton Woods in an ill conceived executive order of his own, the weighing floor of Rothschild's in London would break under the weight of gold airlifted from the United States to redeem dollars. The Swiss would open their own gold market in Zurich. And the dollar price of an ounce of gold would escalate over $40. Within ten years of Nixon's action, the price of gold would soar over $800.

To save the dollar, it was exported to countries with even worse inflation, as Robert Landis has pointed out. Exporting demand for dollars eventually reached its acme. Now the world uses the dollar as a reserve currency, and many countries like Canada have sold all their gold. We are now poised for an uncontrolled monetary hyperinflation that will destroy much of the global economy by debasing the dollar to its intrinsic value.

The harbinger of this great suffering was just another lie - just another bit of data that you could tell LBJ was lying if his lips were moving. Silver too valuable to be used as money? Nope. Dollars too worthless to be made of silver. (And, more recently, pennies of that era worth more as copper than as currency.)

Gold Mining

Here's how the stocks we presently suggest in this area look of late (Friday morning 3 March 2006):

Company Symbol




Almaden AMM.TO




Luzon LZN.V




Pinnacle PNL.V




Western WNP.V




Lumina Resources



Northern Peru Copper



Regalito Copper RLO




Silver Standard SSRI




Vista VGZ.TO




Apex Silver SIL




Newmont Mining NEM




Northgate NXG




Tan Range TRE




We did meet many interesting people and learned about several excellent companies at the Vancouver show. To report on those stocks here would further delay this issue. We'll go back and write the 30 January issue soon, while the show is still fairly fresh in mind. Then the 2005 status on the free market money industry should be easily completed, given that it already forms the basis of our market analysis for EZEZ, SA and related appendix.

Other than being ahead of the market in perceiving value where Luzon and Lumina Resources are concerned, there are no major stories to tell on our stock picks. Luzon remains a doubtful play until management finds adequate financing but their properties in Bolivia are first rate. (One of those properties is leased from Vista, no slouches in the gold discovery field and easily worth $5/share of Luzon after extraction.) Lumina Resources, with some ten million ounces of gold in the ground and around $600 per share net asset value, all 43-101 compliant with top-notch management and good paper is an easy play. Simply grab as many of these shares while they remain under a buck as you can.

The other stories are easy to tell. Apex and Silver Standard are both much higher on excellent silver prices. Gold prices are much higher. So are uranium prices. You simply cannot go wrong holding onto these stocks as they double, triple, and run even higher. If you bought Tan Range when we suggested it, sold half your position on the double, you are up an amazing amount of money right now. And the gold stock bull has only entered its third phase - past what Doug Casey calls the "wall of worry" and well before its fourth stage of a blow-off top. Gold mining stocks are not yet trading at a premium to assets in the ground, as they will just before the top begins to blow Spindletop fashion. There is plenty of upside in all these stocks. Only severely bad management or rotten property data could mislead you in this sector.

Free Market Money

Gold closed on Friday 3 March 2006 at $565.80 per ounce troy. Note that the ounce we have from Troyes has 31.1034768 grams, exactly. This fact makes the price of a gram of gold a smidgeon over $18.19.

As a courtesy to our overseas subscribers, and for sites like PVCSE, we'll report the gram price as well as the troy ounce price from now on. The market trades in troy ounces, and the underlying unit of account for all free market money systems except remains the troy ounce. (The dinar is an ancient Islamic weight, calculated in grains.) For example, the GoldMoney system uses a calculated gram for accounting, but stores bars of gold weighed in ounces.

Dow stocks have spent most of February over eleven thousand, and closed Friday 3 March at 11,021.59. These new highs are inflation highs, not value highs. The correct way to normalize the Dow for value is to price it in terms of gold or silver. Silver's volatility probably makes it a better measure of short term inflation, being more widely held and therefore more accurately reflecting price fears in the broader public. Gold has been used more widely for this purpose, however.

The Dow:Au ratio is now down to 19.48. Note that fewer than 20 ounces of gold are needed to buy the Dow today. This value is going to descend until it reaches 3 ounces or less.

On 2 February 2006 the ratio stood at 19.14 when gold had its recent short-term peak of $572.20 (NY close) and the Dow was 10,950. My chart of the ratio below was composed in December 2004 for a speech before the investment special interest group of the Houston Area League of Personal Computer Users (HAL-PC). As you can see, my projections from that date forward included some movement around a ratio of 25, and the measured value in early February is much lower than I projected. So, accusations of psychological catastrophism on my part - always eagerly anticipating the failure of the command economy - are mistaken.

I should note that the data for this chart was served up in a chart of both the Dow/gold ratio and Tobin's Q Proxy from sharelynx charts that I ran across on the in a lengthy review by Bill Fox (in which he projects, among other useful suggestions, a gold price about $7500 per ounce). I found the graphic using's image search feature, then modified the image extensively in a paint program by erasing the Tobin's Q line, adding horizontal levels at the bottom, and adding the zany gold projection line. More recently, I added the purple note demonstrating how foolish my optimism for 2006 had been.

Dow gold ratio with projection. Data from sharelynx charts and

Please note in the chart above the horizontal lines at one ounce, three ounces, and five ounces. The re-set value of one ounce of gold to buy the Dow has been widely quoted, but it only appears twice on the chart, back in the 1870s and again in 1980. The re-set value of three ounces is far more frequent, as Bill Fox mentions in his essay.

One of the dramatic things to note is that the price of the Dow in ounces of gold has run up to nearly 45 ounces. Further, it never makes another long-term peak in new high territory until it resets below 3 ounces. Thus, it seems very likely that the ratio is going to return to this region. For my own part, I anticipate a 21,000 Dow and a $7000 price of gold. At a 2:1 ratio, we might only reach 14,000 on the Dow before gold peaks. Monetary inflation drives nominal prices higher.

In the previous major gold price rally, gold went from $35 per ounce in 1965 to $850 (spot intra-day) in 1980. Actual monetary inflation was clocked at an average of 155% per year in that period. As expected, the government's figures on inflation were much lower.

Oil was $63.36/bbl in the spot market for West Texas Intermediate on Friday 3 March. It takes 8.9 barrels to buy an ounce of gold.

Silver closed Friday at $10.18 per ounce. The Au/Ag ratio is much lower at 55.58. Silver remains under priced at this level. An excellent discussion of the gold to silver ratio may be found in Jim Turk's commentary for 22 February. Jim notes that 55 is a key figure in this ratio, and when the ratio drops below this number, silver prices should be soaring as gold moves strongly higher. Silver always leads the way in hyperinflation.

Copper closed Friday 3 March at $2.2811 per pound. Ag/Cu ratio stands at 4.46. The related Au/Cu ratio is 248.

Zinc is up again to $1.05/pound. The premium on pre-1982 pennies is now stands at 52%. The metal in $100 face value of pre-1982 pennies is worth about $152.18.

Nickel metal closed at $6.77/pound. The USA nickel coin, which is 75% copper and 25% nickel is showing a 24.9% deficit to face value. The metal content in the nickel is worth about 3.75 cents. This value has been increasing, and cross-over may come this year ($8/lb nickel and $3.50/pound copper would do it).

U3O8 was $36.50/pound as reported from 27 February 2006.

Schlumberger was $122.22 on the close Friday 3 March. It is up $40 (or 49%) since our suggestion.

A discussion of PVCSE stocks is certainly in order. We've suggested PVH, GBH, CGB, and MCG. Recently, we've listed PRV which is the PVCSE itself and EZZ, which is the parent company of PVCSE and of Some discussion of these listings, as well as the listing process would seem to be appropriate.

First, what is PVCSE? It is an all-digital stock exchange. The initials stand for Private Venture Capital Stock Exchange, which name gives you some idea of what it's about. Foremost among these terms in the name is "Private." Well, the exchange is a private, members-only club. There is a membership fee of half a gram. There is also a referral fee if you recruit new members - you get to keep a portion of the trading fee on all the stocks they buy on the exchange.

PVCSE is about venture capital. Not ordinary capital, not capital you would invest in, say, treasury bonds or blue chip stocks. Venture capital is money you invest with the expectation of higher returns combined with the realization of greater risk. Venture capital investments may return much more profit to you, or you may lose your entire investment.

So, your portfolio should allocate funds to venture capital investments based on your risk preferences. If you are very risk averse, only a small part, say 5% or so, of your capital should be allocated to venture capital. You still want some of your money earning a high return, but if you are risk averse, most of your money would be invested in lower risk areas. If you are not very risk averse, or if you are fairly young and regard the future as a large part of your life, you may want to allocate a higher percentage of your capital to venture funds. Risk seekers might allocated 40% of their funds to high risk, high return investments, while risk moderating investors would fall in between. How much of your portfolio should you risk? Entirely up to you.

PVCSE is not the only all digital stock exchange. Another we have written about in these pages in the past is The only stock listed on that exchange is The Gold Casino. TGC is noteworthy in having been listed in 2003, and having paid a dividend every month since. We also ran across a new electronic stock exchange at the Vancouver resource stock conference, which we plan to discuss in that issue when it comes out.

What difference does it make? The main idea behind a private stock exchange is to make available capital to companies without all the rigamarole, garbage, and byzantine idiocy we encounter with mainstream stock exchanges. Companies and individuals should have access to capital. The banking cartel and the finance industry exist to limit access to capital, charge high fees and rates for capital, exclude competitors through licensing and other government coercion, and generally make access to capital almost painfully difficult.

Similarly, individuals and companies want to have access to innovative investment opportunities. Cutting edge companies may provide extraordinary high returns on investment. The so-called "blue sky" laws that are allegedly intended to prevent unscrupulous operators from selling widows and orphans promises that amount to "the blue sky above" are actually detrimental to everyone. Companies have more difficulty accessing capital due to these restrictive laws, and individuals have trouble finding high rates of return to go along with their risk. Everyone is made poorer as a result. Bureau-rats thrive by impoverishing others.

So, in October, we began to organize two new ventures. The first venture was the acquisition of We accomplished that in November. Almost immediately, I decided to list the exchange itself on the exchange, so that people could buy into the future profit stream of the exchange as well as become members of the exchange. The market has responded pretty well. Shares of PRV (the three letters chosen to emphasize the private aspect of the exchange) sold initially at 0.55 grams of gold - roughly $8.75 at the time. Since then the price has risen to 0.65 grams of gold - roughly $11.85 today. We plan to offer the next tranche of shares at 0.7 grams of gold or $12.76, possibly as early as 6 March 2006. So, a nice gain in share value.

The second venture we started to organize was EZEZ, SA. Since October, we've generated seven versions of the business plan for that company. Site information available from me on request. EZEZ, SA owns the majority of PVCSE. We've also developed several new sites, including The mission of EZEZ is to bring more individuals and businesses into the gold economy, thereby developing the entire market. To accomplish this mission, we provide tutorials, consulting services, and technical services.

Here are the stocks we're following in the free market money sector. Exchanges are and Rumor has it that more new exchanges are under development.

Company Symbol gAu
Cyber Gold Bank CGB 0.186




Gold Barter Holdings GBH 0.055


MicroCasino MCG 0.790




Pecunix Venture Holdings PVH 0.020

- 0.03

The Gold Casino TGC 103.01


Cyber Gold Bank is our winner in this group. The double in December was followed by a 2:1 share split. Including the split, our initial position's value is about 351% higher.

Space Frontier

Since 1998, Mr. Taylor informs us, private sector spending on space activities has exceeded government spending. The gap is growing wider. That's good news for those of us who have been warning, since 1988 in my case, that government programs were threatening and in many instances destroying private sector alternatives.

Another brilliant comment by Taylor, "The greatest barrier to the open markets of space isn't physical or technological...." though I disagree with his conclusion that the barrier is psychological. Rather, the barriers are governmental and bureaucratic. Get past the red tape which binds most space missions to Earth and the sky is no limit at all.

When you think about other major technology break-throughs such as steamships, railroads, balloons, dirigibles, airplanes, or communication satellites, these ideas were invented and often fully developed in the private sector. Space is sometimes conceived as being different, but it really isn't. In fact, space technology break-throughs have also been largely private sector inventions, from Robert Goddard to Bob Truax to Gary Hudson to Burt Rutan, Paul Allen, and Richard Branson.

Most of the resources that mankind has accessed in the last 15,000 years have come from within the Earth, from its surface, or from the Sun. Disregarding a few meteorites found down through the years, the July 1969 Moon landing brought back the first resources from beyond Earth. But, any serious look at the quantity of resources accessible to humanity today and in the future has to conclude that most of the resources we have at our disposal are not on nor within Earth. Most of the energy we can access isn't down here, either.

If the smallest metal-bearing asteroid has the resources identified in 3554 Amun, what about the rest of the Solar System? There are at least ten planets, dozens of planetary satellites, tens of thousands of asteroids - hundreds of which cross Earth's orbit - and easily hundreds of thousands of cometary objects within a light year of the Sun.

Nor is the Solar System dependent on Earth for its energy resources. The Sun provides excellent energy 24 hours a day. In many Earth orbits, the Sun isn't eclipsed for most of the year. In many Solar orbits, the Sun is never eclipsed. Clouds don't interfere with solar collecting systems, while night is rare or non-existent. Moreover, the abundance of uranium in the Solar System as a whole should be at least as great as it is here on Earth.

So, when is all this bounty going to be available to us? Most likely during the next few decades. The extent to which the resource abundance of the Solar System is available is going to be directly proportional to the extent to which free markets are the rule for space activities. The only powers on Earth that can delay mankind's surge out into the universe are governmental and bureaucratic. In the long run, such impediments don't last.

More information about extra-terrestrial resources is available from the Lunar and Planetary Institute in Houston and the Lunar and Planetary Lab in Tucson.

NASA delenda est.

SpaceDev closed at $1.40 on Monday 13 March. It was down ten cents from our first suggestion. I am beginning to wonder whether the acquisition of Starsys in early February of this year represents a choice to pursue a broader aerospace contractor business strategy. Certainly, Starsys seems to have been a NASA and military subcontractor. While its high quality manufacturing capability presumably has a useful role in SpaceDev's commercial space projects of the future, it may be that SpaceDev is signalling plans to be more of a government contractor in the future - in which case I'm going to have to walk away. I'll try to contact Jim Benson on this point, soon.

Launch Technology

Biak Island is about one degree of latitude South of the Earth's Equator. This proximity to the Equator gives added payload capacity to any given launch vehicle. Since cost to orbit is a bottleneck every advantage counts.

Anatoly Karpov of Russia's Air Start company will invest about $25 million to build the ground base. Other Russian support is expected to provide about $120 million in direct and indirect subsidies to Indonesia for this venture. (Russia is also selling submarines and other military equipment - including jet fighters to replace Indonesia's aging F-16 fighters - as part of closer ties between the two countries.) Air Start is planning to use the support base for air launched satellite systems, similar to the Pegasus launch system from Orbital Sciences.

The final agreement would be signed in June 2006 during a state visit by Indonesia's president to Moscow. Biak island's regent Yusuf Maryen says the government of Indonesia will contribute 27 hectares of land for the project - rather decent of them considering the disputed sovereignty of the island.

In other air launch news, NASA has postponed a Pegasus launch of some microsatellites as of 15 March.

NASA delenda est.

New Country Developments

It is rather sad that Indonesia wants to enter the space age by contributing land on Biak Island to a Russian space launch services company. It must be easy to contribute land that does not properly belong to Indonesia.

The Free Papua Movement promotes the sovereignty and self-determination of West Papua. Their flag is called the Morning Star and consists of a red vertical band along the hoist with a white five pointed star. To the fly are thirteen horizontal stripes of blue and white. The flag was designed in 1961 to be reminiscent of the USA flag.

Flying their flag is illegal in Indonesia and punishable by arrest, detention, torture, and death according to various news reports. One is reminded rather forcefully of British repression of "the wearing of the green" or of tartans in Ireland and Scotland during periods of occupation some centuries ago. West Papuans celebrate the proclamation of 1 December 1961 which established their intent to create the Republic of West Papua and the 1 July 1971 declaration of independence for Papua - which the USA unhelpfully disregarded in order to appease allies in the fruitless war for Vietnam.

Apparently the determination of West Papuans to establish their own country is ongoing. In January 2006, 43 refugees landed on the coast of Australia. They pleaded for asylum and reported that the Indonesia government is carrying out a mass genocide in Papua province. Australia's largely authoritarian and socialistic government has transported the refugees to Christmas Island and is pretending to evaluate their claims.

So, how did it end up that Dutch New Guinea is part of Indonesia? It is the same basic story of betrayal, UN incompetence, and authoritarian imperialism that we see repeated over and over worldwide. In this case, the story more overtly involves Standard Oil and, thus, Rockefeller money.

The people of Papua are Melanesians. These people occupy the legendary Solomon Islands, Vanuatu, New Caledonia, and Fiji as well as New Guinea. Fossil evidence suggests occupation of Papua and the Moluccas for over 40,000 years. There are about 300 languages and hundreds of dialects in Papua.

European involvement begins with Dutch occupation in 1828. During the course of the 19th Century, British, German, and Dutch claims were established on the island. Southeast New Guinea was British and became known as the Territory of Papua, northeast New Guinea was German and the West was Dutch.

In the early 1930s, a national Papuan government was discussed initially by graduates of a Dutch missionary school in Mei Wondama and subsequently by the people across the Dutch region. The principal of the school composed a song "Hai Tanahku Papua" which was adopted as a national anthem in 1961.

Meanwhile, in 1935 the Royal Dutch Shell group formed a company to explore West New Guinea. So did Standard Oil. The Dutch company found the world's richest gold and copper deposits in the mountains near Timika but was unable to license their find from the Dutch government or the indigenous land owners.

Japanese occupation began in 1942 and ended in 1944. The Papuans helped the USA construct a headquarters for Gen. Douglas MacArthur at Hollandia with twenty military bases and hospitals. Papuan farmers provided food for half a million American troops stationed there, and Papuan men worked as medical corpsmen, translators, guides, construction workers, carpenters, and machine shop workers. Much of the focus of the Hollandia headquarters group was preparing for the reconquest of the Philippines.

In 1945, the Dutch retained possession of West New Guinea. However, their colony in Batavia was not supported by the people of Java. Instead, the United States of Indonesia declared its independence under Mohammad Hatta and Sukarno. Rather than sticking with their Indonesian territories, they claimed all Dutch possessions in the region should become part of their country.

The period through 1961 continued the dispute between Indonesia and the Netherlands. Holland recognized Papuan self-determination in 1952 and helped establish a naval academy for the new country. A series of UN reports from 1959 to 1961 illustrated the capacity of Papuans for self-government and independence. These are archived at

Events in this period are not perfectly documented, but there is evidence that the reports of gold discoveries in the region were sent to New York in the post-war years. In March 1959, one such report was pubilshed in the New York Times regarding discoveries of alluvial gold flowing to the Arafura Sea. It seems reasonable to suppose that support for Indonesia's claims to Papua were supported by Freeport Sulphur, which signed a contract with the East Borneo Company in 1960 to mine Western Papua. One would suppose that Dutch Shell's company would have been favored under an independent Papuan government.

Papuan Independence was formally recognized by the Netherlands in ordinances that went into effect 1 December 1961. Papuans still celebrate their independence from this date. However, Indonesia responded in mid-December with an invasion by paratroopers followed by a naval battle in January 1962. The Kennedy Administration supported the Indonesian claims and essentially force the Netherlands to abandon plans for an independent Papua. So, in October 1962, authority over the region was transferred from the Dutch to a UN agency which then handed control to Indonesia in May 1963.

In its usual way, the UN asserted that an "Act of Free Choice" would be organized to determine the will of the people, but in its typical practice, the UN did nothing to safeguard sovereignty or self-determination. Indonesian government suppression, terrorism, murder, assassination, imprisonment, torture, and aerial bombardments were reported from 1962 and generally ignored. The Indonesian government dissolved the Papuan parliament, forbade the flying of the flag or the singing of the national anthem, and generally ran roughshod over the people. Amnesty International estimates that more than 100,000 Papuans have died as a result of government sponsored violence against West Papuans. Other estimates go as high as 200,000.

Indonesia conducted a farce in 1969 called an "Act of Free Choice" but locally characterized as an act of no choice. During the month prior to the referendum, Indonesian military rounded up and detained a large group of Papuan tribal elders. Papuans generally were threatened with death if they didn't vote for Indonesian rule. In its hapless and ultimately futile effort to win the war in Vietnam, the USA and other Western countries ignored protests over the circumstances surrounding the vote. Western observors didn't even bother to witness more than the first few votes cast.

It is presumably mere coincidence that Freeport-McMoRan Copper and Gold obtained an exclusive 30 year mining license in 1967, two years before the sham referendum, over a property which became the world's largest copper and gold mine and the largest open cut mine. Construction on the mine began in 1977 and it opened in 1981.

During the 1990s, Indonesia sent about 1.2 million people from Java and Sumatra to occupy Papua. While the immigrants are Muslim, the natives were Christians or followers of animist religions. Independence was proclaimed as the goal of a separatist congress in 2000 and resulted in a military crackdown. Violence continues in spite of a limited political autonomy for the now-majority-Muslim region.

Of course, the basic problem in all these situations is that the powers that be, such as the USA State Department prefer centralized power rather than a diverse array of local autonomy and self-determination. Policies in the USA and at the UN persistently oppose local independence and favor hegemony by foreign imperialist occupiers. Whether in Asia, Africa, or elsewhere, local autonomy is subjugated for the purpose of centralizing power. Presumably, the goal is to be able to more effectively exploit natural resources and subjugated people.

For example, under the Clinton Administration, Secretary of State Warren Christopher lamented that if people are not compelled to live in multi-ethnic countries, there would be over 5,000 countries in the world before long. (Reported in War and Anti-War by Alvin and Heidi Toffler.) The policy should be directed toward individual liberty, private property, and free markets. Coercion and compulsion, especially for such doubtful goals as having people from different ethnic and cultural groups live without self-imposed boundaries, are unethical.

Taiwan Semiconductor TSM is $9.58 up substantially on our suggestion. AU Optronics (AUTO.ob) has risen from about $0.45/share in early November to $0.87 today.


Artificial womb technology is proceeding from two directions. Dr. Hung-Ching Liu, Ph.D., of Cornell University and her associates have begun by removing cells from the endometrium or lining of the womb. These are then grown in the lab using hormones and growth factors. Liu and her colleagues have grown layers of these cells on scaffolds of biodegradable material modeled into the shape of a uterus. The cells grow into tissue. The scaffold dissolves. Nutrients and hormones including estrogen are added.

"Finally, we took embryos left over from IVF programs and put these into our laboratory engineered tissue. The embryos attached themselves to the walls of our prototype wombs and began to settle there," says Dr. Liu.

Dr. Thomas Schaffer of Temple University is working to develop a breathable perfluorocarbon liquid to support premature babies. The system has been tested on premature lamb fetuses which were not able to breathe regular air. He suggests the technology may work for premature babies less than two pounds in birth weight.

Dr. Yoshinori Kuwabara of Juntendo University in Japan and team have developed an artificial womb made of acrylic plastic filled with heated amniotic fluid. Using goat fetuses, he has been able to successfully transfer a fetus as young as three weeks, roughly comparable to a human fetus about the end of the first trimester. The fetus lies submerged in the amniotic fluid and the umbilical cord or placenta is connected to a dialysis machine which replaces oxygen and cleans the blood supply.

So far, Dr. Liu's work seems to have stopped at about six days with human embryos. Work with mice and dogs is next, following which an appeal to sustain an embryo past the 14 day limit imposed by current legislation regulating in vitro fertilization would be needed. Or, perhaps the work would continue in another country. Dr. Yoshinori's work has kept a goat fetus alive and growing for 10 days.

This area of research shows considerable promise. Many years ago, a case of extra-uterine fetus development was reported. In that instance the embryo migrated out of the uterus and ended up implanting within the abdomen near the woman's intestine. Placenta and fetus developed with that one abnormality and were surgically removed nine months later. Presumably, this sort of viability may be artificially established with advanced transplantation procedures.

Many interesting issues arise with the advent of pregnancy transplantation and artificial womb technology. Separating the issue of ending an unwanted pregnancy from the issue of killing a growing embryo would be an important development in the abortion controversy. It seems likely that a technology which allows a woman with an unwanted pregnancy to be separated from a living unborn child would benefit both parties.

An artificial womb may also provide women with much more reproductive freedom balancing motherhood and career opportunities. Infertile couples may have greater access to adoptable children, or the opportunity to experience live child birth if transplantation succeeds. These possibilities reflect the tremendous opportunity which arises from having more people in the Solar System to produce more wealth - obviously a source of greater prosperity in the long run.

Artificial wombs also provide new options for fertilized embryos now stored at liquid nitrogen temperature because their parents are satisfied with the results of one or more test tube babies already born. Since human life obviously begins at the moment of conception, these embryos represent unfulfilled human potential.

So long as artificial wombs and pregnancy transplantation technologies remain unavailable, the issue of abortion will continue to raise pressing and conflicting issues for liberty enthusiasts. On the one hand, a woman should have sovereignty over her body and be able to remove a trespasser within her body whenever in her judgement doing so is needed to preserve her life, liberty, or property. Just as we would not object to a rapist being removed from her body by her using up to deadly force, we should reflect seriously on the option to use deadly force especially in instances where her life is endangered. At the same time, a human life is in her womb, and any intentional killing would have to be regarded as homicide - whether justifiable or criminal. People would be generally better off if those who wanted to care for a child were able to take up where those who want to terminate an unwanted pregnancy leave off.

It is interesting to see how far this technology has developed. It obviously has substantial implications for an array of other situations, such as the cloning of organ tissue and blood supplies for critically ill patients from their own body cells. Many things are going to become possible in the next few years, so we should begin considering whether these possibilities are ethical or just.

FDA delenda est.

Legislatura delenda est.

Here's how our stock suggestions in the nanotechnology and life extension sector look right now (close Friday 17 March 2006).

Company Symbol US$ delta
CytRx CYTR 1.72 0.82
Accelrys ACCL 7.20 0.59
Dendreon DNDN 4.55 0.77
Elan Corp. ELN 15.01 7.78

Dendreon seems to have trouble with its loss reporting from Fourth Quarter 2005. Our interest in Dendreon is mainly for its fast-tracked cancer drug Provenge. Provenge received FDA fast-track approval designation in 2005 for its ability to treat some forms of prostate cancer. While it has not yet been approved, fast track means it should be, soon, if nothing goes wrong.

Publication Note: The press of other business has limited our time for this newsletter. To make up for it, we're focusing on this newsletter to the end of the quarter, time enough to fill in several back issues and reports.

Gratuitous example of bizarre legislation: The USA has made it illegal to import Japanese Kobe beef. Although the ban was ostensibly over mad cow disease found in 20 Japanese beef cattle in 2001, the reality is that no instances of Japanese beef resulting in mad cow disease in humans could be shown. The protectionist nature of the ban was shown in January 2006 when it was reinstated after having been briefly rescinded from 15 December 2005. The reinstatement was over a discovery of backbone in a shipment of USA veal to Japan. As a result of this ban, the American Kobe beef industry started in Texas by Gary Yamomoto and Shogo Takeda has thrived. Prior to the bilateral ban, Japan was importing almost one and a half billion dollars of American beef which it now imports from other countries. The USA was importing nearly a million dollars of Japanese Kobe beef which it now produces domestically.

Kobe beef has all the carnosine of regular beef, but much less saturated fat. Wagyu Kobe beef cattle produce high levels of oleic acid, the same fatty acid found in olive oil which has been shown to reduce low density lipoprotein cholesterol (so-called "bad" cholesterol).


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