February 12, 2013
- The United States of Drones: Map pinpoints dozens of locations where the surveillance state operates by remote control
- Disturbed by drones? For once, there’s actually something you can do about it
- “Ridiculously low and set to rebound”: Byron King on a commodity you can’t afford to overlook
- “Still struggling,” but small-business owners step back from wrist-slitting despair
- The U.S. state that’s little better than Portugal (no, it’s not California)… gold that’s slimmed down and spread out… why the gold price hasn’t turned into a moonshot (yet)… and more!
A new hashtag on Twitter noticed over the weekend by the veteran muckraking journalist James Bovard:
The list goes on…
We have to apologize early today. We’ve been on the drone beat for several days here in The 5. We can’t help it. We’ve been asking everyone who’ll discuss it with us: What is it about these faceless threats that bothers people so much? Drones don’t kill people, people kill people.
Maybe it’s because the tool can be used with relative anonymity or accountability. Maybe it’s the fact the president and his top advisers review their “targeted strikes” overseas during weekly meetings they casually refer to as “Terror Tuesdays”…
The map represents 81 “public entities” — law enforcement agencies, universities, even an Indian tribal agency — that have received drone authorization from the Federal Aviation Administration. The FAA came clean only because the Electronic Frontier Foundation (EFF) demanded the list via the Freedom of Information Act.
“Even the smallest drones can carry a host of surveillance equipment,” says the EFF, “from video cameras and thermal imaging to GPS tracking and cellphone eavesdropping tools. They can also be equipped with advanced forms of radar detection, license plate cameras and facial recognition. And as recent reporting from PBS and Slate shows, surveillance tools, like the military’s development of gigapixel technology capable of ‘tracking people and vehicles across an entire city,’ are improving rapidly.”
Drones were put in the air last weekend to look for Chris Dorner, the former Los Angeles cop who’s murdered three people and is threatening to kill other cops and their family members. Some media outlets claim this would be the first time an American has been hunted by drones on U.S. soil.
In 2011, a drone was deployed in the middle of nowhere in North Dakota to catch someone wanted for… well, to call it cattle rustling would be generous.
Six cows wandered onto Rodney Brossart’s property. He refused to return them. Police managed to escalate the situation into an armed standoff that lasted 16 hours before it ended peacefully. During that time, they called in a drone from the Department of Homeland Security.
“Grand Forks SWAT team chief Bill Macki said in an interview that the drone was used to ensure Brossart and his family members, who were also charged, didn’t leave the farm and were unarmed during the arresting raid,” according to an account at U.S. News.
Brossart’s lawyer demanded the case be dismissed on grounds of “warrantless use of [an] unmanned militarylike surveillance aircraft.” The courts didn’t buy it.
One place you won’t find on the map above is Charlottesville, Va.
Last week, the city council imposed a two-year ban on drones and forbade the municipal government from buying any drones.
“It’s our hope that the rest of the country will follow Charlottesville’s lead in establishing clear limits on the use of drone technology, especially by law enforcement agencies,” says John Whitehead, president of the Rutherford Institute — the civil liberties nonprofit that calls Charlottesville home.
“Our Founders had no conception of things that would fly over them at night and peer into their backyards and send signals back to a home base,” says Virginia State Sen. A. Donald McEachin. He’s sponsoring a bill that would take Charlottesville’s two-year moratorium statewide.
It passed both houses of Virginia’s legislature last week.
Seattle has done away with its existing drone program after protesters thronged a public meeting last Thursday. “The vehicles will be returned to the vendor,” promises Mayor Mike McGinn.
Anti-drone legislation is on the docket this year in at least nine states. It appears to making the most headway in Florida.
But the real battle is at the federal level. A year ago, almost to the day, the president signed HR 658 — a bill that authorizes 30,000 drones to swarm the skies over the United States.
Now there are early signs some members of Congress are having second thoughts.
“Obama’s nomination of John O. Brennan to lead the CIA has touched off some of the congressional commotion over drones,” reports the Beltway-insider newspaper Roll Call. “As the top White House counterterrorism and homeland security adviser, Brennan has guided the administration’s drone strike policies.”
If there’s any time that public pressure on Washington will have the most effect, it’s now. That’s why the Laissez Faire Club has organized a petition demanding the repeal of HR 658. They’ve already mobilized over 100,000 readers. We expect a few 5 readers might also lend a hand in the effort…
If “we the people” stand any chance at reining in the drones, it’s now… while the topic is hot in Washington. Next year, next month, even next week might be too late. Brennan’s nomination will likely come up for a vote on Thursday.
Now’s the time to register your approbation: Sign the petition. Get the darn drones out of the sky!
When you’re done, pass it along via email or Facebook or Twitter to as many friends as you can.
To the markets. Not a lot of movement this morning. The Dow is inching its way back to 14,000 yet again.
Precious metals have found their footing after yesterday’s takedown — gold at $1,650, silver at $31 on the nose. Crude has firmed to $97.52.
At $43.65 a pound, uranium “is ridiculously low and set to rebound,” says Byron King.
Byron recently had a long talk with a couple of serious uranium scholars. “These gents laid out a strong case for strengthening yellowcake prices this year — 2013 — and well into the future. ‘Yellowcake,’ said one, ‘is comparable to where gold was 10 years ago. We’re looking at prices four-six times higher in the out years.’”
The evidence is compelling, both on the supply side…
- Building a new uranium mine works out to about $100-120 per pound
- Expanding existing mines is costly. Case in point: BHP Billiton deferring the expansion of its giant site at Olympic Dam in Australia.
…and the demand side…
- As we noted recently, China is desperate to clean up its air — which means less coal and more nuclear
- Japan is having second thoughts about abandoning nuclear because it costs so much to bring in liquefied natural gas.
A four- to sixfold move in the uranium price implies $150-250 per pound. “If it works out, it makes great news for uranium producers.” Byron has a favorite in the pages of Outstanding Investments.
Small-business owners felt a little less glum in January than they did in December. The monthly optimism index put out by the National Federation of Independent Business jumped nearly a full point, to 88.9.
It’s a decent jump, and not surprising now that a lot of the uncertainty about taxes has been resolved for now… but by historical standards, it’s still abysmal.
“While corporate profits are at record levels as a share of GDP, small businesses are still struggling to turn a profit,” says NFIB chief economist Bill Dunkelberg.
Asked the “single most important problem” they face, 21% cited taxes, 21% cited red tape, and 19% cited poor sales. A year ago, poor sales led the other two categories.
Don’t look now, but Illinois has crept back into the top 10 list of governments across the world at risk of default.
CMA Datavision monitors the credit default swaps on debt issued by 1,200 governments and assigns a five-year probability of default. A couple of years ago, California and Illinois made regular appearances in the top 10. Now California is set to register a budget surplus this year… while Illinois is back on the list…
Standard & Poor’s downgraded the Land of Lincoln again last month after lawmakers couldn’t come to terms on how to fix the nation’s worst-funded state pension system.
This isn’t new, but it’s very cool.
This pricey billboard is one product of a 10-year partnership between the Science World museum in Vancouver and Rethink, a Canadian ad agency. That’s really 2 ounces of gold… hammered so thin that it covers 200 square feet.
“We thought that instead of telling people how great gold [is], why don’t we demonstrate it,” said Rethink art director Carson Ting.
“If every city put billboards up like this,” enthuses Liz Dwyer in a recent post at the futurist website good.is, “they might help kids keep their inherent curiosity about the world around us.”
Alas, with the need for round-the-clock outdoor security, the billboard was up for a mere three days in May 2010.
Ah, well… Vancouver has many other attractions. The next Agora Financial Investment Symposium is now less than six months away — affording you the chance to check out one of North America’s most extraordinary cities and to hear from an impressive array of investing experts and authorities. Watch this space as we line up speakers for this year’s event, July 23-26… and if you want to lock in early-bird registration rates, you can do so right here.
“I watched that ‘gem’ of a video where the pretty Calgary reporter equated the significant drop in gold to the assertion it was not backed by anything,” a reader writes. “As a Calgarian, I hung my head in shame.
“I don’t know what to say other than the education required to be a reporter is laughable. Calgarians, on average, are not that ignorant. We sell a lot of commodities. Most of us get it.
“Keep up the good work over there.
“P.S. My 10-year-old got the price of gold right when I asked him (within $20).”
“I keep reading how the Chinese (government and individuals) and now the Russian government are both loading up on gold,” a reader writes after yesterday’s episode.
“Also, we all know that the gold miners are under severe price pressures (increased costs/ increased payments to governments, etc.). So with ALL this going on, can someone articulate why the price of gold is not increasing sharply, as opposed to going sideways or even down? (I expect a fine newsletter like yours to give me some insight, and not just the facts.) Thank you…”
The 5: We don’t like to repeat ourselves, but as Samuel Johnson said, “Men more frequently require to be reminded than informed.”
Gold is still in stage two of a three-stage bull market — a cycle cited by James Turk and Doug Casey among gold luminaries. It’s climbing the proverbial “wall of worry,” after the smart money has loaded up but before the masses catch on. For the moment, gold and mining shares still make up a pitifully small percentage of global financial assets — somewhere in the low single digits. At gold’s epic peak in the early ’80s, it was 26%.
Stage three will be when CNBC talks up junior gold miners the way they talked up tech stocks in 1999. And when reporters in Calgary recognize it’s the dollar that’s not backed by anything…
The 5 Min. Forecast
P.S. New figures reveal China has now surpassed the U.S. as the world’s biggest trading nation. U.S. exports and imports totaled $3.82 trillion last year; China’s came to $3.87 trillion.
Consider how much of China’s trade is conducted in U.S. dollars. “China not only needs a way to return all those trade dollars,” says Byron King, “it also needs a safe, reliable place to invest such massive sums of money.” At the same time, “U.S. Treasuries have become a ticking time bomb for China — one they desperately wish to escape from.”
You’ll be bowled over by new evidence — and Byron’s gold price forecast — based on China’s actions alone. Yesterday, we held an editorial meeting to review his case. The finishing touches on the public presentation are in the works. Watch this space.