STOCK MARKET WATCH -- Tuesday, 8 January 2013

[Tansy_Gold]

[font size=3]STOCK MARKET WATCH, Tuesday, 8 January 2013[font color=black][/font]

SMW for 7 January 2013

AT THE CLOSING BELL ON 7 January 2013
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Dow Jones 13,384.29 -50.92 (-0.38%)
S&P 500 1,461.89 -4.58 (-0.31%)
Nasdaq 3,098.81 -2.85 (-0.09%)


[font color=black]10 Year 1.90% 0.00 (0.00%)
30 Year 3.10% 0.00 (0.00%)[font color=black]


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[font size=2]Market Conditions During Trading Hours[/font]
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[font size=2]Euro, Yen, Loonie, Silver and Gold[center]

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[font color=black][font size=2]Handy Links - Market Data and News:[/font][/font]
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Economic Calendar
Marketwatch Data
Bloomberg Economic News
Yahoo Finance
Google Finance
Bank Tracker
Credit Union Tracker
Daily Job Cuts
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[font color=black][font size=2]Handy Links - Economic Blogs:[/font][/font]
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The Big Picture
Financial Sense
Calculated Risk
Naked Capitalism
Credit Writedowns
Brad DeLong
Bonddad
Atrios
goldmansachs666
The Stand-Up Economist
The Automatic Earth
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[font color=black][font size=2]Handy Links - Essential Reading:[/font][/font]
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Matt Taibi: Secret and Lies of the Bailout


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[font color=black][font size=2]Handy Links - Government Issues:[/font][/font]
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LegitGov
Open Government
Earmark Database
USA spending.gov
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[font color=black][font size=2]Handy Links - Videos:[/font][/font]
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Charlie Rose talks with Roubini
Charlie Rose talks with Krugman
William Black: This Economic Disaster
Bill Moyers with Kevin Drum and David Corn
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[font color=red]Partial List of Financial Sector Officials Convicted since 1/20/09 [/font][font color=red]
2/2/12 David Higgs and Salmaan Siddiqui, Credit Suisse, plead guilty to conspiracy involving valuation of MBS
3/6/12 Allen Stanford, former Caribbean billionaire and general schmuck, convicted on 13 of 14 counts in $2.2B Ponzi scheme, faces 20+ years in prison
6/4/12 Matthew Kluger, lawyer, sentenced to 12 years in prison, along with co-conspirator stock trader Garrett Bauer (9 years) and co-conspirator Kenneth Robinson (not yet sentenced) for 17 year insider trading scheme.
6/14/12 Allen Stanford sentenced to 110 years without parole.
6/15/12 Rajat Gupta, former Goldman Sachs director, found guilty of insider trading. Could face a decade in prison when sentenced later this year.
6/22/12 Timothy S. Durham, 49, former CEO of Fair Financial Company, convicted of one count conspiracy to commit wire and securities fraud, 10 counts of wire fraud, and one count of securities fraud.
6/22/12 James F. Cochran, 56, former chairman of the board of Fair, convicted of one count of conspiracy to commit wire and securities fraud, one count of securities fraud, and six counts of wire fraud.
6/22/12 Rick D. Snow, 48, former CFO of Fair, convicted of one count of conspiracy to commit wire and securities fraud, one count of securities fraud, and three counts of wire fraud.
7/13/12 Russell Wassendorf Sr., CEO of collapsed brokerage firm Peregrine Financial Group Inc. arrested and charged with lying to regulators after admitting to authorities he embezzled "millions of dollars" and forged bank statements for "nearly twenty years."
8/22/12 Doug Whitman, Whitman Capital LLC hedge fund founder, convicted of insider trading following a trial in which he spent more than two days on the stand telling jurors he was innocent
10/26/12 UPDATE: Former Goldman Sachs director Rajat Gupta sentenced to two years in federal prison. He will, of course, appeal. . .
11/20/12 Hedge fund manager Matthew Martoma charged with insider trading at SAC Capital Advisors, and prosecutors are looking at Martoma's boss, Steven Cohen, for possible involvement.



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[font size=3][font color=red]This thread contains opinions and observations. Individuals may post their experiences, inferences and opinions on this thread. However, it should not be construed as advice. It is unethical (and probably illegal) for financial recommendations to be given here.[/font][/font][/font color=red][font color=black]

[jtuck004]

1. Ths video of Ecuador and Correa's actions to take some of their profits and invest it

in the country are talked about.

For Bill Black fans, he talks about 2/3 of the way through, here.

[tclambert]

2. I'm fascinated by the trillion dollar platinum coin idea.

The government mints one, puts it in the Federal Reserve Bank, and the national debt goes down by $1 trillion. Experts say it will not cause inflation. It simply raises the debt limit without all the ridiculous Congressional game-playing.

And maybe we can auction off "face rights." Some crazy rich guy can bid to get his face put on the coin. (How could Donald Trump pass that up?)

[xchrom]

3. bon jour!

[xchrom]

4. Ireland raises €2.5bn in bond sale

http://www.irishtimes.com/newspaper/breaking/2013/0108/breaking30.html

The National Treasury Management Agency has sold €2.5 billion of 2017 bonds in its first syndicated sovereign deal since 2010, having received orders worth more than €7 billion.

The last time Ireland raised funds through a syndicated deal – which differs from an auction in that the price is pre-agreed – was before the EU-IMF bailout programme of December 2010.

Ireland looks likely to become the first sovereign to successfully exit a euro zone bailout programme and is expected to issue approximately €10 billion of debt this year.

"It was an excellent deal for Ireland ... There was a decent spread of demand across geographies. We've seen a few accounts getting back involved after the two-and-a-half year hiatus from the (Irish debt agency)," a trader said.

[Demeter]

17. Define success

The foreign banks got everything they wanted?

[xchrom]

20. bulls eye. nt

[xchrom]

5. Spread on Irish debt a 'poor reward'

http://www.irishtimes.com/newspaper/breaking/2013/0108/breaking18.html

Irish Central Bank governor Patrick Honohan said the current spread on long-term Irish sovereign debt is a "poor reward" for the nation's efforts to narrow the fiscal deficit.

"Irish Sovereign spreads may no longer be bloated by redenomination risk, but at 300 basis points at the long-end, they do seem to reflect a credit risk premium that is poor reward, so far, for what has been a sizable fiscal adjustment effort," Mr Honohan said.

"The Irish financial situation is relatively extreme, and as such illustrates clearly some of the key problems that have been faced also in other stressed parts of the euro area.''

''The pernicious feedback loop from banks to sovereign and from sovereign to banks that re-emerged in the crisis remains strong and damaging,'' Mr Honohan said.

[xchrom]

6. Eurozone unemployment reaches new high

http://www.bbc.co.uk/news/business-20943292

The unemployment rate across the eurozone hit a new all-time high of 11.8% in November, official figures have shown.

This is a slight rise on 11.7% for the 17-nation region in October. The rate for the European Union as a whole in November was unchanged at 10.7%.

Spain, which is mired in deep recession, again recorded the highest unemployment rate, coming in at 26.6%.

More than 26 million people are now unemployed across the EU.

[xchrom]

7. Louis Armstrong - Basin Street Blues - 1959

[xchrom]

8. German exports post sharp decline in November

http://www.bbc.co.uk/news/business-20943286

German exports fell sharply in November, hit by the economic weakness in the eurozone.

Its exports fell 3.4% from October, on a seasonally adjusted basis, official figures showed. Compared with a year earlier, exports were unchanged.

Germany's imports in November were also lower, down 3.7% from the month before.

The country is the world's second-biggest exporter after China. About 60% of Germany's exports go to other nations within the European Union.

[xchrom]

9. CES 2013: Sony unveils bath-friendly Xperia Z smartphone

http://www.bbc.co.uk/news/technology-20918742

Sony has announced a new smartphone that can be used in the shower or bath without the risk of damage.

This water-resistant feature is relatively common in Japan, but has not been included in many top-end smartphones released elsewhere.

The Xperia Z can also record HDR (high dynamic range) video, a facility borrowed from its camera division.

One analyst said it was evidence of Sony Mobile making progress but added "it still had a mountain to climb".

[xchrom]

10. Catalan nationalists get ready for bitter battle as transition body is formed

http://elpais.com/elpais/2013/01/07/inenglish/1357587934_262962.html

The Catalan CiU nationalist bloc and its parliamentary partner, the Catalan Republic Left (ERC), have begun to hunch down in their trenches, in preparation for a showdown with the central government over their plans to hold a vote on sovereignty for Catalonia next year.

On Monday, the two political forces officially created the so-called National Catalan Transition Council, which will help drum up support from opposition parties and society for the planned vote on independence.

The two pro-independence forces will draft a sovereignty declaration that they will present to the regional parliament on January 23.

The ongoing confrontation between the nationalists and the central government is expected to overshadow a ceremony today when Prime Minister Mariano Rajoy, who has warned against holding the vote without congressional approval, and premier Artur Mas of the CiU will meet to help inaugurate the new AVE high-speed rail line that will connect Barcelona, Girona and Figueres. The new route will eventually link to the French high-speed rail lines.

[xchrom]

11. Stretched households start to cut back on food purchases{spain}

http://elpais.com/elpais/2013/01/07/inenglish/1357570314_389470.html

Beset by the highest unemployment rate in Europe, inflation, wage containment and tax hikes as part of the government’s austerity drive, and having long since abjured luxuries, Spanish households are now cutting back on purchases of food to make ends meet.

Not only are families, for example, switching from olive oil to cheaper forms of cooking oil, they are also cutting back on the amounts they purchase and are leaving out items such as wine from their shopping lists.

According to figures released by the Agriculture, Food and Environment Ministry, the amount of items purchased by households in October fell by 1.8 percent and by 2.3 percent in September when average prices increased by 0.7 percent. According to the ministry’s monthly survey of 12,000 homes, spending on food per person has fallen for the past three recorded months.

Consumption of olive in October fell 15.7 percent, while that of sunflower oil climbed one percent. Consumption of still wine dropped 9.4 percent, while sparkling wine declined 9.8 percent.

[xchrom]

12. The euro crisis is over, declares José Manuel Barroso

http://www.guardian.co.uk/business/2013/jan/07/euro-crisis-over-jose-manuel-barroso


'I think we can say that the existential threat against the euro has essentially been overcome,' said Barroso. Photograph: Sasha Mordovets/Getty Images


The euro has been saved and the euro crisis is a thing of the past, European commission president José Manuel Barroso has declared.

But his optimistic comments and the prospect of looser rules for banks failed to lift markets, which ended a strong run of recent gains.

"I think we can say that the existential threat against the euro has essentially been overcome," Barroso said in Lisbon. "In 2013 the question won't be if the euro will, or will not, implode," he said.

Barroso has maintained an optimistic stance throughout the crisis, but his comments were in sharp contrast to the new year's message from German chancellor Angela Merkel, who told TV viewers last week that the currency zone faced another rocky 12 months.


***for who?

[Demeter]

18. The Vietnam strategy: Declare Peace and Go Home

Except where is home, when you've been foreclosed?

[xchrom]

13. Climate change, debt and inequality 'threaten financial stability'

http://www.guardian.co.uk/business/2013/jan/08/climate-change-debt-inequality-threat-financial-stability

Persistent economic weakness is sapping the ability of governments to tackle the growing threat of climate change and risks a global "perfect storm" of intertwined financial and ecological collapse, the World Economic Forum has warned.

In the runup to its annual meeting in Davos this month, the WEF used its annual Global Risks report to urge policy leaders to step up their efforts to tackle the three big dangers cited by a panel of 1,000 experts: severe income disparities, the indebted state of governments and rising greenhouse gas emissions.

"These global risks are essentially a health warning regarding our most critical systems", said Lee Howell, the report's editor. "National resilience to global risks needs to be a priority so that critical systems continue to function despite a major disturbance."

The report showed that for the second year running, the widening income gap, chronic fiscal imbalances and greenhouse gas emissions were seen as the three most likely threats to emerge over the coming decade. Of those risks deemed likely to have the biggest impact on the global community, a major systemic financial failure and a water supply crisis were again deemed to be the most serious, followed by chronic fiscal imbalances, food shortage crises and the spread of weapons of mass destruction.

[xchrom]

14. Professor Longhair - Tell Me Pretty Baby

[xchrom]

15. Climate change and poverty have not gone away

http://www.guardian.co.uk/business/2013/jan/07/climate-change-poverty-inequality

In the shadow of the euro crisis and America's fiscal cliff, it is easy to ignore the global economy's long-term problems. But, while we focus on immediate concerns, they continue to fester, and we overlook them at our peril.

The most serious is global warming. While the global economy's weak performance has led to a corresponding slowdown in the increase in carbon emissions, it amounts to only a short respite. And we are far behind the curve: because we have been so slow to respond to climate change achieving the targeted limit of a 2C rise in global temperature will require sharp reductions in emissions in the future.

Some suggest that, given the economic slowdown, we should put global warming on the backburner. On the contrary, retrofitting the global economy for climate change would help to restore aggregate demand and growth.

At the same time, the pace of technological progress and globalisation necessitates rapid structural changes in both developed and developing countries alike. Such changes can be traumatic, and markets often do not handle them well.

[xchrom]

16. Buckwheat Zydeco - Hey Ma Petit Fille

[xchrom]

19. MONSANTO PROFIT BALLOONS ON LATIN AMERICAN SALES

http://hosted.ap.org/dynamic/stories/U/US_EARNS_MONSANTO?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2013-01-08-09-08-13

WASHINGTON (AP) -- Agricultural products giant Monsanto reported Tuesday that its profit nearly tripled in the first fiscal quarter as sales of its biotech corn seeds expanded in Latin America.

The company raised its earnings guidance for the year, lifting shares 4 percent in premarket trading.

The company's sales grew 21 percent to $2.9 billion in the quarter, with most of increase coming from the company's corn seed business.

The St. Louis company earned $339 million, or 63 cents per share in the three months ended November 30. That compares to earnings of $126 million, or 23 cents per share, in last year's quarter.

[xchrom]

21. Model Reformer in Trouble Ireland Lobbies to Have Europe Share Banking Risk

http://www.spiegel.de/international/europe/ireland-seeks-to-have-europe-share-in-risk-of-ailing-banking-sector-a-876124.html

In his home country, Irish Prime Minister Enda Kenny, 61, has a reputation for being somewhat wooden. But when he meets with German Chancellor Angela Merkel and other top German politicians, he's capable of unaccustomed gallantry, as the Irish have noted with surprise. For instance, Kenny has recently proved that he's a master of the diplomatic art known as "air kissing."

This Tuesday, the Irishman will have yet another opportunity to demonstrate his skills. Kenny is traveling to the southern German village of Wildbad Kreuth, where the conservative Christian Social Union (CSU) -- the Bavarian sister party to Merkel's Christian Democratic Union (CDU) -- is holding its annual gathering. At it, Kenny hopes to schmooze with Horst Seehofer, the CSU's chairman, and Gerda Hasselfeldt, head of its federal parliamentary group. Shortly after breakfast, and before a speech by the chairman of the Bavarian Farmers' Association, Kenny plans to present his country as a model of successful reform policies.
Kenny's charm offensive is not entirely altruistic. For over two years -- and to the delight of the Anglo-Saxon media -- the conservative leader has been trying to get European taxpayers to foot the enormous bill for bailing out Ireland's ailing banking sector. But, taking their cue from the Germans, the Europeans have so far balked at the idea.

Instead, Chancellor Merkel has been quick to praise the way Ireland has implemented economic reforms and used money from European bailout funds over the past few years to emerge from the crisis: Exports have risen, the country has regained its competitiveness, and it has even succeeded in getting private creditors to lend it some money.

[DemReadingDU]

22. AIG may join bailout suit against U.S. government

1/8/13 AIG may join bailout suit against U.S. government

American International Group Inc , the insurer rescued by the U.S. government in 2008 with a bailout that ultimately totaled $182 billion (113.2 billion pounds), may join a lawsuit against the government alleging the terms of the deal were unfair. The company confirmed a New York Times report that said AIG's board would meet Wednesday to discuss joining a lawsuit filed against the government by the insurer's former chief executive, Hank Greenberg.

The move would be something of a shock development given that AIG just launched a high-profile TV ad campaign called "Thank you America," in which it offers gratitude for the rescue, which was fully repaid with a profit last year. At the same time, Chief Executive Bob Benmosche has complained publicly that the company and its management have not gotten enough credit for avoiding a collapse, turning the business around and returning to profitability.

Greenberg, whose Starr International owned 12 percent of AIG before its near-collapse, has accused the Federal Reserve Bank of New York of using the rescue to bail out Wall Street banks at the expense of shareholders, and of being a "loan shark" by charging exorbitant interest on the initial loan. A federal judge in Manhattan dismissed Greenberg's suit against the New York Fed in November; a separate suit under different legal theories in the U.S. Court of Federal Claims is still pending. An AIG spokesman declined to comment beyond confirming that the board would meet.

http://finance.yahoo.com/news/aig-may-join-bailout-suit-131741407.html

[xchrom]

25. oy vey. nt

[DemReadingDU]

28. Some interesting comments on the NYT article about AIG

http://dealbook.nytimes.com/2013/01/07/rescued-by-a-bailout-a-i-g-may-sue-its-savior/#postComment

[xchrom]

30. that was satisfying.

the Snark is strong.

[DemReadingDU]

26. ZeroHedge: AIG Considers Suing US Over US Bailout Of AIG

1/8/13 AIG Considers Suing US Over US Bailout Of AIG

Sometimes you just have to laugh - or you will cry. In what could well have been Tuesday Humor if it wasn't so real, the AIG board (fulfilling its shareholder fiduciary duty) is considering joining Hank Greenberg's suit against the government over the cruel-and-unusual bailout that saved the company. The $25bn lawsuit, as NY Times reports, based not on the basis that help was needed but that the onerous nature "taking what became a 92% stake in the company with high interest rates and funneling billions to the insurer's Wall Street clients" deprived shareholders of tens of billions of dollars and violated the Fifth Amendment (prohibiting the taking of private property for "public use, without just compensation&quot .

The 'audacious display of ingratitude' comes weeks after the firm has repaid the $182 billion bailout funneled to it and its clients by an overly generous Treasury. The firm has asked for 16 million pages of government documentation, this "slap in the face of the government" portends a question of whether the government will sue The Fed for enabling the recovery that strengthened Greenberg's case that the bailout was so harsh. Happy retirement Tim Geithner.

http://www.zerohedge.com/news/2013-01-08/aig-considers-suing-us-over-us-bailout-aig

[Demeter]

31. Excuse me?

This govt. did everything except pee for AIG, what are they bitching about? Having to sell off their toy subsidiaries?

[Demeter]

34. FROM NYT: Rescued by a Bailout, A.I.G. May Sue Its Savior

...The Treasury Department declined to comment. A spokesman for the Federal Reserve Bank of New York, Jack Gutt, said, “There is no merit to these allegations.” He noted that “A.I.G.’s board of directors had an alternative choice to borrowing from the Federal Reserve, and that choice was bankruptcy.”

A federal judge in Manhattan agreed, dismissing the case in November. In an 89-page opinion, Judge Paul A. Engelmayer wrote that while Starr’s complaint “paints a portrait of government treachery worthy of an Oliver Stone movie,” the company “voluntarily accepted the hard terms offered by the one and only rescuer that stood between it and imminent bankruptcy.”

The United States Court of Appeals for the Second Circuit recently agreed to review the case on an expedited timeline. The judge in the United States Court of Federal Claims in Washington, meanwhile, has declined to dismiss the case and continues to await A.I.G.’s decision. END ARTICLE

http://dealbook.nytimes.com/2013/01/07/rescued-by-a-bailout-a-i-g-may-sue-its-savior/#postComment

[Hotler]

42. FUCKERS!

[tclambert]

43. Oh, this will be fun to watch. And the original suit was filed by Maurice "Hank" Greenberg.

He's the guy who sued AIG, the company that he used to be CEO of.

This will be hilarious.

[xchrom]

23. Possible Boost for EU Economy Germany Gears Up for Big Pay Hikes

http://www.spiegel.de/international/germany/german-trade-unions-demanding-big-pay-increases-after-years-of-restraint-a-876268.html

Frank Bsirske, the head of the Ver.di service workers' union, gets annoyed when he hears people say that Germany is doing pretty well. "That only applies to the well-off," he says angrily. "The gap between rich and poor has never been this wide, and never has the middle class felt this threatened." The union leader is even worried that social conflict could escalate.

His recipe against the erosion of society is hardly surprising: Wages have to go up, and by a significant amount, at that. In the current collective bargaining round, Ver.di is calling for a 6.5-percent pay increase -- the highest in years -- for German public sector employees.
Bsirske has the support of other unions with his demand for a substantial pay hike. After metalworkers' union IG Metall fought for improvements in the treatment of temporary workers and more assistance for trainees in the last bargaining round, the union's main focus in the new round beginning in May will be on money. "Our demand will focus on a decent pay increase," says IG Metall regional director Meinhard Geiken. Michael Sommer, head of the German Federation of Trade Unions (DGB), is convinced that "the people who keep the country running and generate its wealth deserve to get their fair share."

Although it sounds like union ritual, the labor organizations are getting more support than they have in a long time. For more than a decade, it was considered reasonable in Germany to keep wage increases moderate at best, in light of high unemployment. But now the country is getting used to a new logic, namely that Germany, more than any other European economy, can afford pay increases.

[Demeter]

32. Viele Gluck, Herr Bsirske!

You are going to need it.

[xchrom]

24. Flag Riots in Northern Ireland New Belfast Unrest Worries Business Leaders

http://www.spiegel.de/international/europe/sectarian-unrest-in-belfast-a-threat-to-local-economic-recovery-a-876352.html

In Northern Ireland, it was hoped that an end to decades of unrest would finally result in an economic turnaround -- one which would be instrumental to establishing lasting peace. And initially, it seemed to work. In the years following the signing of the 1998 Good Friday Agreement, which established a tentative peace between Protestant groups loyal to the United Kingdom and Catholic groups seeking union with Ireland, foreign investment rocketed upwards and business activity in Belfast also picked up.

More recently, however, the Northern Irish economy has been anything but dynamic, with negative effects of the recent downturn in the British economy being even more pronounced in Belfast and its surroundings than elsewhere in the UK. And now, with sectarian violence having flared up in recent weeks, local leaders are warning of its potential negative impact on business.
"Northern Ireland has been lagging behind the rest of the UK and our recovery has been slow," Glyn Roberts of the Northern Ireland Independent Retail Trade Association told SPIEGEL ONLINE. "This has come at the worst possible time and my concern is that these protests are making the situation even worse."

Roberts' concern was echoed by Invest Northern Ireland. "A small number of potential investors have raised concerns about the current level of unrest," the group said in a statement quoted by the Irish Times. "Invest NI is working closely with them to minimize the impact of any negative perceptions."

[xchrom]

27. Secrets and Lies of the Wall Street Bailout

http://www.commondreams.org/view/2013/01/08-0



It has been four long winters since the federal government, in the hulking, shaven-skulled, Alien Nation-esque form of then-Treasury Secretary Hank Paulson, committed $700 billion in taxpayer money to rescue Wall Street from its own chicanery and greed. To listen to the bankers and their allies in Washington tell it, you'd think the bailout was the best thing to hit the American economy since the invention of the assembly line. Not only did it prevent another Great Depression, we've been told, but the money has all been paid back, and the government even made a profit. No harm, no foul – right?

Wrong.

It was all a lie – one of the biggest and most elaborate falsehoods ever sold to the American people. We were told that the taxpayer was stepping in – only temporarily, mind you – to prop up the economy and save the world from financial catastrophe. What we actually ended up doing was the exact opposite: committing American taxpayers to permanent, blind support of an ungovernable, unregulatable, hyperconcentrated new financial system that exacerbates the greed and inequality that caused the crash, and forces Wall Street banks like Goldman Sachs and Citigroup to increase risk rather than reduce it. The result is one of those deals where one wrong decision early on blossoms into a lush nightmare of unintended consequences. We thought we were just letting a friend crash at the house for a few days; we ended up with a family of hillbillies who moved in forever, sleeping nine to a bed and building a meth lab on the front lawn.

How Wall Street Killed Financial Reform

But the most appalling part is the lying. The public has been lied to so shamelessly and so often in the course of the past four years that the failure to tell the truth to the general populace has become a kind of baked-in, official feature of the financial rescue. Money wasn't the only thing the government gave Wall Street – it also conferred the right to hide the truth from the rest of us. And it was all done in the name of helping regular people and creating jobs. "It is," says former bailout Inspector General Neil Barofsky, "the ultimate bait-and-switch."

The bailout deceptions came early, late and in between. There were lies told in the first moments of their inception, and others still being told four years later. The lies, in fact, were the most important mechanisms of the bailout. The only reason investors haven't run screaming from an obviously corrupt financial marketplace is because the government has gone to such extraordinary lengths to sell the narrative that the problems of 2008 have been fixed. Investors may not actually believe the lie, but they are impressed by how totally committed the government has been, from the very beginning, to selling it.

[BlueStreak]

29. Notice where the market has gone since the day after the "cliff" deal passed?

Proponents of that deal argued that if we didn't do whatever they wanted to do, the economy would tank and the markets would reflect. It appears the stock market bought that story for about 24 hours. And since that time, it has been a slow steady slide downhill as the market figured out what we actually did was:

- Made 99% of the Bush tax cuts permanent, ensuring a structural deficit until the GOP can get in there and whack more programs

- Kicked the can down the road regarding any cost savings, especially any reductions to the Pentagon budget

- Didn't go after any of the most abusive tax evasion practices, and loaded up a bunch of special interest tax breaks, such as special breaks for rum producers in Puerto Rico and the US Virgin Islands. WHAT!!!!?????

[Demeter]

33. The Market Goes with My Mood, and My Future

Grim.

I'm not often in tune with the greater world that way...

[kickysnana]

35. Added one word: anativaxxer, & one phrase:concealed carry to Auto Trash.

No sense working against my blood pressure meds.

[Demeter]

36. Secret Goldman Team Sidesteps Volcker After Blankfein Vow

http://www.bloomberg.com/news/2013-01-08/secret-goldman-team-sidesteps-volcker-after-blankfein-vow.html

Sitting onstage in Washington’s Ronald Reagan Building in July, Lloyd C. Blankfein said Goldman Sachs Group Inc. (GS) had stopped using its own money to make bets on the bank’s behalf. “We shut off that activity,” the chief executive officer told more than 400 people at a lunch organized by the Economic Club of Washington, D.C., slicing the air with his hand. The bank no longer had proprietary traders who “just put on risks that they wanted” and didn’t interact with clients, he said...That may come as a surprise to people working in a secretive Goldman Sachs group called Multi-Strategy Investing, or MSI. It wagers about $1 billion of the New York-based firm’s own funds on the stocks and bonds of companies, including a mortgage servicer and a cement producer, according to interviews with more than 20 people who worked for and with the group, some as recently as last year. The unit, headed by two 1999 Princeton University classmates, has no clients, the people said.

The team’s survival shows how Goldman Sachs has worked around regulations curbing proprietary bets at banks. Former Federal Reserve Chairman Paul A. Volcker singled out the company in 2009, saying it shouldn’t get taxpayer support if it focuses on trading. A section of the 2010 Dodd-Frank Act known as the Volcker rule, drafted to prevent banks from taking on excessive risk, limits short-term investments made with firms’ capital. The law doesn’t bar longer-term wagers. That leaves room for other risky investments, according to Matthew Richardson, an economics professor at New York University’s Stern School of Business. Bets that last months can go awry and belong outside federally backed banks, he said.

“From a systemic-risk perspective, it’s really the longer- term holdings which are of issue,” said Richardson, who heads NYU’s Salomon Center for the Study of Financial Institutions...

Hedge Fund

“MSI is very much like a hedge fund,” said Ashkan Marsh, 30, who worked for the unit before leaving the firm in 2008.

Goldman Sachs, the fifth-biggest U.S. bank by assets, doesn’t report on the holdings or performance of MSI, or of the Special Situations Group in which it’s housed. That parent group, which uses the firm’s funds to profit from distressed and middle-market companies, has been a major profit center at the bank, sometimes the biggest, former executives told Bloomberg in 2011. Its holdings that year included debt of Melville, New York-based pizza chain Sbarro Inc...Their team at Goldman Sachs has bet against companies through short selling, or the sale of borrowed securities, and while investments are supposed to last for months they sometimes end early, according to half a dozen former members...MSI doesn’t trade in and out of positions each day, according to alumni, and one said he wished he could have traded more. Still, the team sold most assets after a few months, said Marsh, the former member who’s now at Harvard. Jeanette Cajide, 36, an associate in the Special Situations Group in 2007 and 2008 who now works in development at Dialexa LLC, a Dallas-based technology firm, said she was jealous of MSI’s faster pace.

Goldman Sachs has been wagering its own money for decades. After the firm bought commodities broker J. Aron in 1981, the unit risked the bank’s capital “not in the service of clients but simply to achieve handsome returns,” according to “Goldman Sachs: The Culture of Success” by Lisa Endlich, an ex-employee...The firm also used its own capital for risk arbitrage, or betting on takeover targets, under a team led in the 1980s by Robert Rubin, who became Goldman Sachs’s co-chairman and later U.S. Treasury secretary. The group grew into the equities division’s Principal Strategies team. A separate global macro desk speculated on currencies and rates...

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41. Banks Get Delay in New Rule, Keeping Taxpayers on the Hook for Risky Trades By Pat Garofalo

http://www.nationofchange.org/banks-get-delay-new-rule-keeping-taxpayers-hook-risky-trades-1357402304

Regulators have decided to delay rules that would have required Wall Street banks to isolate some of their risky derivatives trading in entities not backed by taxpayers. Banks will now have until at least 2015 to comply with the rules, Bloomberg News reports:

JPMorgan Chase & Co. (JPM), Goldman Sachs Group Inc. (GS) and Bank of America Corp. won a delay of Dodd-Frank Act requirements that they wall off some derivatives trades from bank units backed by federal deposit insurance.

Commercial banks including the Wall Street firms may get as long as an additional two years — until July 2015 — to comply with the rules, the Office of the Comptroller of the Currency said in a notice yesterday. The provision was included in Dodd- Frank, the 2010 financial-regulation law, as a way to limit taxpayer support for risky derivatives trades…The so-called push-out provision of Dodd-Frank requires that equity, some commodity and non-cleared credit derivatives be moved — or pushed out — into separate affiliates without federal assistance.

“The procrastination of both regulators and the banks on this portion of Dodd-Frank has been pretty amazing,” said Marcus Stanley, policy director for Americans for Financial Reform. “The swaps-pushout provision is a really important part and something that absolutely should be a central part of the regulatory framework.” As economists Jane D’Arista and Gerald Epstein wrote, “the intent is to remove risky activities from the core banking functions that are essential to the economy and to ensure that those risky activities will not trigger the need for a bail out to prevent systemic collapse in the future as they did in the 2008 crisis.”

This is hardly the first rule from the Dodd-Frank financial reform law to get bogged down in delays. The Volcker Rule — also meant to rein in risky bank trading with dollars backed by the government — has been delayed, and House Republicans want to push back its implementation even further.

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37. Fiscal Cliff Drama Produces an Awful Farm Bill Extension

http://www.motherjones.com/tom-philpott/2013/01/fiscal-cliff-farm-bill

Remember the farm bill, that once-in-five-years legislation that sets the nation's agriculture and hunger policy? Due for reauthorization in 2012, it lurched through both the Senate and the House ag committee. But then it floundered on the floor of the House—whose GOP leadership refused to bring it to a vote, in an attempt to avoid conflict with tea party stalwarts seeking draconian cuts in anti-hunger programs.

But everything changed on New Year's Day, when the fiscal-cliff deal between Congress and the White House included a fast-and-dirty, stop-gap farm bill compromise that will be in place only until September—meaning that Congress will have to start from scratch on a new five-year bill this year.

Thus like the fiscal-cliff deal itself, the farm bill extension amounts to a feeble kick of the can down the road. And as you might expect from something hastily slapped together behind closed doors, it's a policy hodgepodge, and mostly a dismal one. The National Sustainable Agriculture Coalition, the main progressive ag lobbying group, minced no words in its assessment: "a disaster for farmers and the American people."

WE AS A NATION HAVE COME TO EXPECT NOTHING MORE

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39. The Endless Cliff Robert Kuttner

http://prospect.org/article/endless-cliff

Beyond THE narrow escape from the dreaded fiscal cliff are … more cliffs.

President Obama and Congress averted one fiscal calamity of tax-hikes-for-all only to face even steeper cliffs—the sequester, the debt ceiling, the Social Security shortfall, ad infinitum. It is a fiscal Wizard of Oz, an extended odyssey with perils on every side. The question progressives are asking themselves ... is whether President Obama settled for too little in the fiscal mini-deal, having traded away his best single piece of leverage—the automatic tax increase on all Americans scheduled to hit today unless Congress acted. Some, like our colleague Robert Reich, have argued that it would have been better to “go over the cliff”—let tax hikes briefly take effect on everyone, thus increasing pressure on Republicans—rather than to make this agreement. Mercifully, Obama backed off any “grand bargain.” The deal was a defeat not only for the Republicans but for the Fix the Debt corporate gang. It spared the economy cuts in Social Security or Medicare (for now). But on the other side of the ledger, it included no agreement to raise the debt ceiling. The impact of the automatic “sequester” of $120 billion in other spending cuts was postponed only 60 days. These issues will now have to be negotiated separately,

Republicans convinced themselves that they will get to press for deep budget cuts all over again by holding the debt ceiling hostage; the need to extend the debt ceiling is their equivalent of the expiration of the Bush tax cuts—leverage on President Obama. It was that rationale, plus the need to prevent a tax increase on the bottom 99 percent, that allowed most Senate Republicans and enough House Republicans to tear up the Grover Norquist no-tax-hikes-ever pledge and vote for this deal.

Could Obama have gotten more? Quite possibly, though it was an accomplishment to keep all spending cuts out of the deal, at least for now.

Progressive groups, led by the AFL-CIO and Democratic leaders in Congress, deserve a lot of the credit for holding Obama’s feet to the fire on two core principles on which the president delivered—no to cuts in Social Security and yes to tax increases on the richest. Obama did cave, perhaps needlessly, on only one key element: restoring the pre-Bush tax rates just for households with over $450,000 income for couples and $400,000 for singles rather than the $250,000 in the president’s original offer. But the deal could have been a lot worse. And as recently as a week ago, when the White House was offering backdoor cuts in Social Security via changing the cost-of-living adjustment formula, it looked as if it would be.

What can we expect going forward?

President Obama, having discovered that toughness works better than premature conciliation, took a very hard line last night on the issue of the debt ceiling. Coming into the White House briefing room shortly after the House vote, he declared, “While I will negotiate over many things, I will not have another debate with Congress over whether they should pay the bills they’ve already racked up … .” This, presumably, means that Obama, if necessary, will invoke his authority under the Fourteenth Amendment, which declares that debts of the United States shall not be questioned. It was not until the World War I era that the ritual of approving a debt ceiling was even asserted by Congress. This is a position long urged on Obama by Bill Clinton...Yet unless Obama continues to play hardball on all fronts, the risk is that he will consent to budget cuts as the price of the next deal, at a time when the economy needs more public spending, not less. He needs not only more spine; he needs to alter the terms of debate, rejecting not only the ideology of Republican right but the economic idiocy of the corporate center, which has persuaded elite opinion (including at the White House) that recovery requires debt reduction.

WELL, WE SHALL SEE...I'M WITH HOTLER ON THIS ONE

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38. All Hail Wall Street Harold Meyerson

http://prospect.org/article/all-hail-wall-street

...Everyone acknowledges that laying off hundreds of thousands of government employees, including 800,000 civilian Defense Department workers, and stopping payment to government contractors will, by definition, destroy jobs, at least until the payments resume. It’s still Republican orthodoxy, to be sure, to deny that government spending actually creates jobs, but even they acknowledge that the cessation of government spending destroys them. Which illustrates that the problem with contemporary Republicanism isn’t confined to their indifference to empiricism but also their indifference to logic. Reasoning—either deductive or inductive—is either beyond them, beneath them or above them. A second Republican talking point called into question by the fiscal-cliff legislation enacted Tuesday is that the 47 percent don’t pay taxes. In fact, every American employee, including the millions who aren’t paid enough to pay income taxes, saw their payroll tax increased Tuesday by the bipartisan failure of Congress to extend the payroll tax cut that had been enacted as part of the Obama administration’s original stimulus legislation back in 2009. Despite Republican protestations, the payroll tax is a tax, of course, and more particularly, it’s a tax on earned income—to coin a phrase, an income tax. The difference is, it’s not progressive—the working poor are not exempted, and pay at the identical rate as the rich up to the point where taxable income hits its ceiling.

Even more depressing than the complicity of both parties in raising the regressive payroll tax is their complicity in failing to significantly raise the tax rates on dividends and capital gains—the rate was raised just from 15 percent to 20 percent for the wealthiest taxpayers. The Washington Post's Suzy Khimm summarized the new provisions for Wonkblog: “The tax on capital gains and dividends will be permanently set at 20 percent for those with income above the $450,000/$400,000 threshold. It will remain at 15 percent for everyone else. (Clinton-era rates were 20 percent for capital gains and taxed dividends as ordinary income, with a top rate of 39.6 percent.)” Time was when the Democrats were simply opposed to taxing income from investments at a lower rate than income from work. Indeed, in 2003, as the National Journal's invaluable Ron Brownstein has tweeted, only two Democratic senators voted to lower the capital gains and dividend tax rates to the levels they largely declined to raise earlier this week. Problem is, the never-very-strong case for taxing investment income at a lower rate than labor income has grown weaker still in the era of globalization. If you invest, say, in General Electric (GE), from which you derive dividend income, you’re investing in a company that has hundreds of facilities and many thousands of workers overseas. The investment income you provide the company by buying its stock is as likely to be spent creating jobs in China or India as it is to create jobs in the United States. A GE employee who works in the U.S., on the other hand, is creating value in the U.S. But she’s taxed at a higher rate than a shareholder only a fraction of whose investment creates value here. Assuming one purpose of the tax code is to bolster the domestic economy more than the economy of other nations, taxing that investment at a lower rate than the employee’s labor is completely backward.

As well, wages constitute a declining share of both the nation’s total income and corporate expenditures, reflecting the downward drag that globalization, mechanization and de-unionization have had on workers’ incomes. Wages have fallen from 53 percent of GDP in 1970 to 44 percent today—a shift of nearly $1.5 trillion away from wage income. Profits, and with them, dividends and capital gains, have been growing at wages' expense: J.P. Morgan chief investment officer Michael Cembalest has calculated that reductions in wages and benefits were responsible for about 75 percent of the increase in corporate profits between 2000 and 2007. Taxing wage income at a higher rate than investment income, then, only increases the growing economic inequality that characterizes the pre-tax economy.

There’s no mystery behind the lower tax rates for capital income than for labor income: They simply reflect the continued, indeed growing, ascendency of capital over labor—in the Democratic Party, based on this week’s not-so-grand bargain, no less than in the GOP. Democrats will get a second chance to rectify this imbalance when they have to come up with some more revenues to offset the sequester, which has now been rescheduled to take place two months from now. If the logic of the above arguments doesn’t move them, the fact that Wall Street tilted strongly Republican in November’s election while labor saved their bacon in the presidential, senatorial, and congressional elections in a dozen states might move them yet.

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40. Payday Lenders Agree to Stop ‘Deceptive and Illegal’ Practices By David Heath

http://www.nationofchange.org/payday-lenders-agree-stop-deceptive-and-illegal-practices-1357401742

Controversial lenders that claim to be owned by Indian tribes and offer payday loans over the Internet have agreed to stop practices that federal authorities say deceive borrowers and violate federal laws. The agreement, filed in federal court, could save borrowers hundreds of dollars on each payday loan....The Federal Trade Commission last year sued an Overland Park, Kan., company, AMG Services, to recover millions of dollars in revenues, alleging that borrowers were illegally deceived. The business was founded and is still managed by Scott Tucker, best known as an endurance race-car driver who recently won the Baltimore Grand Prix. The Center for Public Integrity first exposed Tucker’s business practices in an investigation done with CBS News. The case awaits trial. But the FTC argued that AMG Services was continuing to mislead thousands of new borrowers. Tucker and the representatives from the Indian tribes last month agreed to change the practices that the FTC said were illegal.

Borrowers previously had to give the lenders direct access to their bank accounts and have payments automatically withdrawn from their checking account. But instead of a single payoff, the lenders would withdraw interest-only payments for months. By drawing out the loan payments out, a $300 loan could end up costing the borrower nearly $1,000. The FTC said this was not properly disclosed under the Truth-in-Lending Act. With the agreement filed in a federal court in Nevada, the lenders will no longer require access to a borrower’s bank account and the loans will be paid off in one payment. The lenders also agreed not to tell borrowers that they could go to jail or be sued if they didn’t pay the loan back.

Authorities in several states had pursued AMG Services, accusing the company of violating state payday lending laws. Seventeen states restrict or forbid payday loans. Nearly all states require payday lenders to register. But AMG Services said it was owned by Indian tribes and therefore had tribal sovereign immunity. Those tribes are the Miami and Modoc of Oklahoma and the Santee Sioux of Nebraska. The attorney general of Colorado spent years battling the tribes in court, showing that they receive only 1 percent of the revenue from the business. Bank records show that much the rest of the money is used to bankroll Tucker’s personal expenses, including millions spent each year on his racing team, Level 5 Motorsports. The tribes argue that the FTC cannot sue them either, an issue that will be decided in federal court. Other issues yet to be decided are whether the lenders are violating federal law and if so, how much money they would have to pay back.

The lenders use a variety of brand names, including UnitedCashLoans, US FastCash, 500Fastcash, OneClickCash and Ameriloan.