Friday, 27 November 2015

Oklahoma Pension Fund's failed 'Herbalife (HLF)' lawsuit - a brief analysis.

Blog readers will draw their own conclusions from the following news from the USA.

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Judge Dale Susan Fischer

Two days ago (for the third time), a US federal judge, Dale Susan Fischer, refused to bite the foul-smelling tip of the 'MLM' bullet, and has now definitively ruled that a civil lawsuit filed against 'Herbalife,' and its senior corporate officers, by a group of former-investors (who lately, freely-accept that they were duped into buying dangerously-volatile shares in a dissimulated pyramid scheme), cannot go ahead.

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When we sift through the largely-irrelevant detail of this series of morally, and intellectually, relativist rulings, we discover that the Judge is not saying that Bill Ackman's unoriginal published analysis of 'Herbalife' (as an effectively-valueless corporate front for a pyramid scheme preying on the vulnerable) is in any way inaccurate, or that certain individuals within the senior ranks of the 'Herbalife' organisation are not guilty of wrongdoing. On the contrary, what she has said is that:

  • Prior to their buying 'Herbalife' shares, the complaining-investors could have formed the same conclusions as Bill Ackman, because the information upon which he formed his own conclusions, was in the public domain. 
  • Bill Ackman's published analysis cannot alone be taken as proof that 'Herbalife' is a fraud.
  • Even though they were given the opportunity to do so, the plaintiffs' attorneys did not strictly follow legal precedent and produce specific examples of misleading statements made by the CEO of 'Herbalife,' Michael Johnson.
  • The plaintiffs failed to show that Michael Johnson personally knew of the wrongdoing inside his company, therefore, they didn't prove the CEO of 'Herbalife' to be a liar.

As ever, the morally, and intellectually, probing question which the plaintiff's attorney's failed to put to Judge Fischer, was:

Given that the empty income-tax record (in more than 100 countries around the world) conclusively proves that the bosses of 'Herbalife' have always been occulting an overall loss/churn rate in their so-called 'MLM Income Oportunity' of effectively 100%, what would be your personal reaction if a close friend, or a member of your own family (particularly a young person), came to you and excitedly announced that he/she was going to sign-up for the so-called 'Herbalife MLM Income Opportunity?'

The plaintiff's attorney's made absolutely no mention of my own published overall analysis of 'Herbalife' as being just one of hundreds of copy-cat counterfeit 'direct selling' companies - the bosses of which have all been hiding key-information, and constantly-broadcasting the same reality-inverting propaganda, to shield a form of ongoing major racketeering activity (as defined by the US federal Racketeer Influenced and Corrupt Organisations Act, 1970). 

David Brear (copyright 2015)


Reuters, Nov 25th 2015: 

A federal judge dismissed a lawsuit accusing Herbalife Ltd (HLF.N) and Chief Executive Officer Michael Johnson of defrauding shareholders by misrepresenting that the weight-loss and nutritional products company's complied with laws designed to prevent pyramid schemes.

U.S. District Judge Dale Fischer in Los Angeles decided on Monday that the Oklahoma Firefighters Pension and Retirement System failed to show that the defendants intended to deceive shareholders and materially misrepresented Herbalife's business.

Fischer, who had thrown out two earlier versions of the lawsuit, dismissed the case with prejudice, meaning it cannot be brought again.

Herbalife shares were up 26 cents at $58.39 in Wednesday morning trading on the New York Stock Exchange.

The lawsuit is separate from the campaign against Herbalife by billionaire activist investor William Ackman of Pershing Square Capital Management LP, who in December 2012 announced a $1 billion bet against the Los Angeles-based company.

Herbalife has long denied that it is a pyramid scheme, which often occurs when participants earn more money by recruiting others to sell products than by selling the products.

The Oklahoma fund's lawsuit accused Herbalife of "grossly" understating the percentage of sales going to retail customers.

It also said Johnson was closely involved in Herbalife's day-to-day affairs, making him familiar with the alleged deceptive activity, and took advantage of a share price he knew was inflated by selling more than $126 million of company stock.

Fischer, however, said that despite new allegations about Johnson's "hands-on" involvement, the lawsuit still failed to sufficiently allege fraud.

"Plaintiff has had multiple opportunities to correct shortcomings," she wrote. "An amendment would be futile."

Maya Saxena, a lawyer for the Oklahoma fund, did not immediately respond to requests for comment on Wednesday. Herbalife, in a statement, said it was "obviously pleased" with Fischer's decision.

The lawsuit sought class-action status on behalf of shareholders from Feb. 23, 2011 to Dec. 19, 2012, when Ackman disclosed his short bet.

In May, another federal judge approved Herbalife's $15 million settlement with distributors who said the company misled them.

Thursday, 26 November 2015

Alan Turing vs the new enigma, 'Islamic State.'

Totalitarianism (or totalism*) is enduring, but its camouflage is ephemeral

* Totalism

In 1961 (after years of field-research, interviewing US servicemen and civilians held prisoner during the Korean War), Robert Jay Lifton (b. 1926) published, ‘Thought Reform and the Psychology of Totalism.’ In this standard, medical text-book, Lifton identified 8 ‘themes’ which, if present in any group, indicate that its members are being subjected to a mixture of social, psychological and physical pressures, designed to produce radical changes in their individual beliefs, attitudes and behaviour.

1). ‘Milieu control’ — the attempted control of everything an individual experiences (i.e. sees, hears, reads, writes and expresses). This includes discouraging subjects from contacting friends and relatives outside the group and undermining trust in exterior sources of information; particularly, the independent media.

2). ‘Personal or mystical manipulation’ — charismatic (psychologically dominant) leaders create a separate environment where specific behaviour is required; leading to group members believing that they have been chosen and that they have a special purpose. Normally group members will insist that they have not been coerced into group membership, and that their new way of life and beliefs are the result of a completely free-choice.

3). ‘Demand for purity’ — everything in life becomes either pure or impure, negative or positive, etc. This builds up a sense of shame and guilt. The idea is promoted that there is no alternative method of thinking or middle way, to that promoted by the group or by those outside it. Everything in life is either good or bad and anything is justified provided the group sanctions it as good.

4). ‘Confession’ — personal weaknesses are admitted to, to demonstrate how group membership can transform an individual. Group members often have to rewrite their personal histories and those of their friends and relatives, denigrating their previous lives and relationships. Other techniques include group members writing personal reports on themselves and others. Outsiders are presented as a threat who will only try to return group members to their former incorrect thinking.

5). ‘Sacred science’ — the belief in an inexplicable power system or secret knowledge, derived from a hierarchy who must be copied and who cannot be challenged. Often the group’s leaders claim to be followers of traditional historical figures (particularly, established political, scientific and religious thinkers). Leaders promote the idea that their own teaching will also benefit the entire world, and it should be spread.

6). ‘Loading the language’ — a separate vocabulary used to bond the group together and short-circuit critical thought processes. This can become second nature within the group, and talking to outsiders can become difficult and embarrassing. Derogatory names, or directly racist terms, are often given to outsiders.

7). ‘Doctrine over persons’ — individual members are taught to alter their own view of themselves before they entered the group. Former attitudes and behaviour must then be re-interpreted as worthless, and/or dangerous, using the new values of the group.

8). ‘Dispensing of existence’ — promotion of the belief that outsiders — particularly, those who disagree with the teaching of the group — are inferior and are doomed. Therefore, they can be manipulated, and/or cheated, and/or dispossessed, and/or destroyed. This is justifiable, because outsiders only represent a danger to salvation.

Erich Hermann Wilhelm Voegelin (1901-1985), was a gifted German academic, who, in the decade preceding WW II (working largely-alone), produced an insightful explanation of ‘Nazism’ as a form of perverted religion or cult. Sadly, during the 1930s, few people took much notice of Eric Voegelin. 

Whilst teaching political theory and sociology at the University of Vienna, he published two books, ‘The Race Idea in Intellectual History’ and ‘Race and the State’. In these, he pointed out the elementary, mistakes which invalidated various, popular ‘racial theories’In 1938, Voegelin (aged 37) tried to publish 'The Political Religions'. In this, he focused on contemporary totalitarian ideologies derived from the ‘racial theories’ which he’d previously criticised as absurd pseudo-science. He now pointed out the glaring structural similarities of these ideologies to religions. Courageously, Voegelin was comparing medieval pseudo-sciences and 'Gnostic' cults to the 'Völkish or Pan-German’ movement and its terrifying post-WW I incarnation, the 'Nazi party'.

In 1938, the ‘Nazi’ leader, Adolf Hitler, had held absolute power in Germany for almost 5 years. He had just taken control of Austria. The self-gratifying ‘Aryan Master Race’ delusion was spreading like a virus. In essence, Hitler controlled his fanatical core-adherents by peddling as fact an emotionally, and intellectually, overwhelming comic-book fiction in which he was a morally and intellectually perfect Aryan super hero, the 'führer,' on a mission to save his 'pure and noble race' from the slavery of the world financial/political system which had fallen under the control of an 'evil secret society of degenerate sub-humans - Jews, Freemasons, Communists,' etc.

The dozens of books, essays and reviews which Eric Voegelin published during his lifetime, are almost impossible for the average person to take in.

Eric Voegelin

To give readers some idea of the scale of his thinking, Voegelin’s Major work, ‘Order and History’, began to be published in the USA in 1956 when he was aged 54, but it remained unfinished when he died 31 years later. In simple terms, Voegelin took an elevated, and broad, view. He observed that, throughout human history, there have been periods of mass-alienation... following wars, revolutions, plagues, natural disasters, economic depressions, etc. ... during these periods, dangerous manipulators (acting like ancient, Gnostic Prophets by pretending moral and intellectual authority and offering some form of Utopian existence in the here and now) who at other times might be dismissed as absurd crackpots and charlatans, have found it much easier to become accepted as authentic Messiahs and to acquire a mass-following.

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It is, therefore, of supreme irony that the psychopathic, self-appointed leaders of the (contemporary) totalitarian cult commonly-referred to as the 'Islamic State (IS),' have presented their own Utopian fiction as fact via the Internet - using information technology which was initially developed by (persons whom the 'IS' narrative would systematically categorise as) 'Infidels'  to combat the spread of a Utopian fairy story presented as reality by the psychopathic self-appointed leaders of another (now-defunct) totalitarian cult.

The destructive controlling-scenario entitled, 'Islamic State' a.k..a. 'Caliphate,' is neither original nor unique; consequently, it cannot be fully-understood in isolation. Classically, it has been tailored to fit the existing beliefs and instinctual desires of a specific group of already- alienated individuals. For centuries, essentially the same 'Us vs Them / Good vs Evil' comic-book narrative, has continued to be adapted to enter, and infect, vulnerable minds - spreading exactly like a virus. Indeed, this ongoing criminogenic phenomenon can be accurately described as the original (organic) computer virus.

Dr. Alan Turing (1912-1954)

Today, Dr. Alan Mathison Turing is universally recognised as a giant, but tragic, figure in history.

1931-1934, Alan Turing studied mathematics a Kings College Cambridge, graduating with a first class honours degree.

I935, Alan Turing (aged just 22) was elected as a fellow of Kings College. 

Alan Turing is the individual who, in 1936, set out and formalised the concepts which produced the Universal Turing machine - the first theoretical model for a general purpose computer. As a result, Dr.Turing is considered to be the father of computer science and artificial intelligence. The central principle of today's computers (i.e. controlling the machine's operations by a program of coded instructions stored in a memory) was Alan Turing's original idea.

(1936-1938) Dr. Turing studied mathematics and cryptology at Princeton University, obtaining a PhD in 1938.

During WWII, Dr. Turing (who had been talent-spotted and recruited by British Military Intelligence on his return to Cambridge in 1938) worked at the Government Code and Cypher School, Bletchley Park, where (by applying the principle that what can be constructed by a human mind: can also be taken to pieces another human mind) he developed various techniques for deciphering messages sent via the most-advanced version of the German 'Enigma' enciphering/deciphering machine. This electromechanical device (which had been in existence since the end of WWI), had previously been considered as completely secure. 

It is now a matter of historical record that, but for Dr.Turing, WWII would almost-certainly have dragged on at least until 1947.

Marian Rejewski                        Jerzy Rozycki                         Henryk Zygalski

When the wider picture is examined, Dr. Turing and his Bletchley Park colleagues could not have succeeded, but for the groundwork of Marian Rejewski, Jerzy Rozycki and Henryk Zygalski of the Polish Cypher Bureau. With the help of German documentation recovered by French military intelligence, in 1932 these three brilliant, young mathematician/cryptologists, first reverse-engineered the original Enigma machine using theoretical mathematics. Mechanical devices were then developed for deciphering intercepted-Enigma-encrypted radio messages, but after 1938, German cryptologists took the precaution of vastly-increasing the complexity of Enigma machines by adding extra rotors, and the Poles did not have the necessary resources to counter this sudden advance. Consequently, fearing an imminent German attack on their country, in July 1939, Polish leaders and intelligence chiefs handed over to British and French Military intelligence agents (stationed in Warsaw), everything that Polish cryptologists had managed to achieve. Subsequently, all tangible traces of this initial breach in the security of Enigma, were destroyed. 

The timely, secret transfer of Polish expertise saved neither Poland nor France from invasion, but it did enable Dr. Turing and his colleagues to develop a much more powerful, and rapid, electromechanical calculating machine capable of decrypting almost all intercepted, heavily-encrypted Enigma-messages. The resulting massive-flow of important up-to-date strategic intelligence that the British government and military, air and naval, commanders obtained via Bletchley Park, was itself given the code-name, 'Ultra' a.k.a. the 'Ultra Secret.' At various times during WWII, Winston Churchill felt obliged not to act on 'Ultra' intelligence for fear that, by doing so, German intelligence would realise what was occurring. However, even though the evidence of a near-total communications security breach often stared them in the face, the leaders of the 'Aryan Master Race,' and their partners in crime, were evidently incapable of accepting that almost every move they ordered to be made, was known by their inferior opponents, before it was made.  

Winston Churchill reportedly told King George VI, that 'it was thanks to Ultra, that we won the War.' However, the 'Ultra Secret' remained closely-guarded until the 1970s, when the techniques involved, finally became out-dated. 

After the war, Dr. Turing (who had acquired a reputation as a charming, but eccentric, loner, prone to dramatic swings of mood) appeared to return to his previous academic career, but he continued to work in secret for GCHQ (the successor to Bletchley Park and equivalent of America's National Security Agency). 

Officially, in 1954, Dr. Turing (aged 41) committed suicide by eating part of an apple which he had injected, and/or coated, with cyanide poison. However, although cyanide was found in Dr. Turing's body and at his home, the remains of the apple (recovered from a bedside table next to his body), were never tested, and there are now a number of commentators calling for a full inquiry into Dr. Turing's enigmatic 'Snow White/ Wicked Queen'-style death; and particularly, to uncover what hidden role UK security services might have played.

In truth, Dr. Turing was effectively-executed in 1952 (aged 39), when he was arrested for, and convicted of, the (then) common criminal offence of 'gross indecency' (i.e. homosexual activity between consenting adults) and sentenced to chemical castration (i.e. as an alternative to a humiliating prison sentence, he was released on the condition that he accept female hormone injections for a period of 12 months). Given the fact that, in 1950s Britain, male homosexuals and  bisexuals, were often physically attacked as dangerous paedophiles, perverts and pariahs, and could, if convicted of 'gross indecency,' be imprisoned for life, the events surrounding Dr. Turing's arrest, have never been fully-explained; for he went to his local police station in Manchester to report that he'd been the victim of a crime, and gave an apparently reckless statement in which he openly-admitted that he'd been involved in a passionate relationship with a much younger man who turned out to be a thief.

Although, in 1952, very few people knew the extraordinary truth about Dr. Turing's central role in the defeat of tyranny, evidently, the British government (again led by Sir Winston Churchill) made no attempt to protect him and, instead, abandoned him to a fate which clearly he did not deserve. The fact that Winston Churchill partly built his own reputation in history by standing on the shoulders of intellectual giants (knowing that, for decades, they could not be given any credit), reveals his personal failure to intervene on behalf of Dr. Turing in 1952, to have been both morally-reprehensible and (surprisingly, for a Nobel Prize-winning historian) short-sighted. 

Werhner von Braun (centre left rear, in civilian dress)

What  Dr. Turing was forced to endure in silence, is almost unimaginable. Apart from the fact that (like thousands of other gay British men) he was punished for something over which he had no control, he must also of been fully-aware that, in 1945, a significant number of 'Nazi' scientists  - like ballistic missile inventor, Werhner von Braun (a member of the SS who designed Hitler's so-called 'revenge weapons' which caused death and misery to thousands of slave labourers, not to mention death and mutilation to thousands of British men, women and children) - had been allowed to escape all prosecution as war criminals, because the US government offered them amnesty in return for their expertise. Ironically, von Braun (who was born in the same year as Alan Turing), was already, in 1954, an important and wealthy man in the USA. Von Braun was even awarded the US National Medal of Science two years before his death in 1977 (but he was too ill to attend the presentation ceremony at the White House). Yet , even today, Dr.Turing's personal role in saving countless American lives and billions of dollars, has never been officially recognised in the USA.

Niels Bohr and Albert Einstein

In view of his own previous achievements (and his youth), Dr.Turing's unjust categorisation as a degenerate, could easily have been recognised by the British government as being contrary to national interests, for the 'Nazis' had caused many of Europe's most-brilliant thinkers (like Albert Einstein and Niels Bohr) to flee to the USA, because, as Jews, they were also unjustly categorised as degenerate. These same European scientists, first took a leading role in persuading the US Government to commit funds to develop the Atomic bomb - knowing that the 'Nazis' were already on the same path. They then took a leading role in developing the Atomic bomb.

Unfortunately, in 1952, British Intelligence agencies, under pressure from their American counterparts, were operating a rule preventing known-homosexuals being given security clearance. Indeed, many gay men were being unjustly removed from key-positions in Britain (particularly, in the armed forces and civil service), because (mainly due to the illegality of homosexual activity) they were rightly considered to be easy blackmail targets. The previous year, British intelligence had been heavily-embarrassed when two of its agents, Guy Burgess and Kim Philby (both of whom were homosexuals who had been secretly groomed and recruited by KGB agents, when they were university students), had disappeared to the Soviet Union after passing secret intelligence to the Soviets for 20 years.Thus, after his arrest, Dr. Turing had his security clearance immediately revoked and he was excluded from GCHQ. Self-evidently, he must have been placed under M15 surveillance as major security threat  - another possible defector and KGB blackmail targetbut with access to the greater part of the Ultra Secret, and to Cold War, code-breaking techniques. 

In 1953, Dr. Turing is known to have been interviewed by British police officers, this time regarding a young Norwegian man who had been visiting with him. He is also known to have taken a holiday in Greece which, due to its proximity to the Soviet Empire, must have really got his MI5 case officers in a flap. However, the extent and nature of the British security services' contact with Dr. Turing in the two years prior to his death, has never been made public.

Although Dr. Turing's friends and family (who initially knew nothing of his historically-important work as a codebreaker) continued to believe that he died accidentally after handling cyanide during a chemistry experiment, other informed-observers have lately-concluded that there is a very strong likelihood he was silenced by MI5, who deliberately applied pressure on him knowing that he would crack and kill himself; for, after WWII, a number of captured Enigma machines were sold by the victorious Allies to developing countries whose leaders and intelligence chiefs had been led to believe that, in its most-advanced form, Enigma was still completely secure. In reality, and unbeknown to the coroner who pronounced a verdict of suicide, at the time of Dr. Turing's death, British, French and American intelligence agencies were all regularly intercepting Enigma-encrypted messages. These top secret communications (some of which must have contained commercially-valuable inside-information) might as well have all been written in plain language due to the computing techniques which Dr. Turing had developed for, and given to, his country.

Edward Snowden

Had Dr. Turing made a run for it and blown the whistle on the vast intelligence-gathering Enigma fraud (a la Edward Snowden), then all Hell might have broken loose.

September 10th 2009, following an Internet-based campaign, British Prime Minister, Gordon Brown, made an official apology for 'the appalling and inhumane way Dr. Turing was treated.' However, Mr. Brown conveniently failed to point out that this 'appalling inhumane treatment,' had been at the hands of a overtly-homophobic, but (in many cases) covertly-homosexual, British establishment, the hypocritical members of which had mostly-failed to recognise, let alone challenge, the rise of the pernicious 'Nazi' ritual belief system, and whom Dr. Turing had secretly played a leading role in saving from destruction.

In May 2012, a private member's Bill was put before the UK House of Lords to grant Dr. Turing a statutory pardon for his criminal conviction of 1952. However, on December 23rd, 2013, it was announced that Dr. Turing had been granted a pardon under the (rarely-used) Royal Prerogative of Mercy.

Following on from work he began in 1941, in 1950, Dr. Turing published a paper, 'Computing Machinery and Intelligence,' in which he discussed the existing philosophical question of whether machines can think. He then proposed a test, in the form of a blind question and answer game, where computers would be used to try to convince humans that they were not engaging with machines, but with other humans. Thus, despite its appearance, the 'Turing Test' is not a high-brow parlour-game or even a scientific experiment to determine whether machines can think, but a rudimentary, logical test of whether an artificial mind can be made to appear to have the same cognitive capacity as the human mind.

In recent years, various people have suggested ways in which the 'Turing Test' can be reversed, but, as far as I am aware, no one has yet suggested that Dr. Turing's celebrated thoughts on artificial intelligence, can also be applied to the study of the cult/totalitarian phenomenon; for, due to their incapacity to engage with external reality, the inflexible core-adherents of totalistic cults have often been compared to robots. However, the way that exploitative, self-perpetuating non-rational ritual belief systems bait, trap and enslave their prey, by reflecting common human instinctual desires as being obtainable in exchange for absolute subservience, can also be compared to a phenomenon which Dr. Turing did not live to witness - computer viruses. Had Dr. Turing been able to continue his work, he might have eventually felt the need to propose a rudimentary, logical test of whether an artificial mind can be made to appear to have the same ego-related capacity to become delusional as the human mind; for although cult adherents insist that no one is controlling them and that they are excercizing free-will, nonetheless, illogically, and without exception, they all see the world in mechanical two-dimensional terms ('negative vs positive', 'us vs them' , 'good vs evil' , 'winners vs losers', etc. ), communicate in code-like thought-stopping language and obey their de facto programmers without question (no matter what suffering this entails).

Given a detailed knowledge of any Utopian fiction modifying the personalities and behaviour of the core-adherents of a particular cultic group, it would, therefore, be a relatively simple matter to program a machine to duplicate the adherents' systematic responses (or indignant refusal to respond), to a series of blind questions concerning the contents of the group's controlling narrativeIn other words, the predictable answers given by deluded core-cult adherents, and those given by machines programmed to duplicate human minds dissociated from external reality, would be indistinguishable. 

David Brear (copyright 2015)