STOCK MARKET WATCH -- Friday, 25 January 2013

[Tansy_Gold]

[font size=3]STOCK MARKET WATCH, Friday, 25 January 2013[font color=black][/font]

SMW for 24 January 2013

AT THE CLOSING BELL ON 24 January 2013
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Dow Jones 13,825.33 +46.00 (0.33%)
S&P 500 1,494.82 +0.01 (0.00%)
[font color=red]Nasdaq 3,130.38 -23.29 (-0.74%)


[font color=red]10 Year 1.85% +0.01 (0.54%)
[font color=black]30 Year 3.04% 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]

[Demeter]

1. Or maybe, metaphorically?

as in, blood from a turnip?

[Fuddnik]

2. There's nothing left.

All bought and paid for. Sold out.

They had a clearance sale during the last election.

[Tansy_Gold]

3. There was nothing better.

And I've had a particularly crappy day/week/month/year (so far).

and it's raining.

[Fuddnik]

4. Here's one. Fitting, after the resurrection of the filibuster.

http://www.derfcity.com/newstuff/newtoon.html

[Demeter]

5. That's Funny, Doc.

But the joke's on us. Half our Congresscritters ARE hissing cockroaches!

[DemReadingDU]

21. Hisssssss!

[Demeter]

6. How Big Was It?

http://www.zerohedge.com/contributed/2013-01-24/dis-dat

By far and away, the worst financial crack-up in history was Fannie and Freddie. That disaster has cost $142 billion. The knock-on effects of the collapse of these two were devastating. F/F went out of biz on September 7, 2008. The next weekend Lehman blew up. F/F put the nail in the coffin at the “Brothers”, and after that, all the dominoes were falling.

With that in mind, I'm amazed that AAPL has blown off nearly twice the F/F losses in six-months, and there is not even a ripple in the water. Last night, in a few seconds of after-market trading, the stock got pasted for more than all of the losses for LEH. By the opening, the overnight losses exceeded more than LEH, AIG, GM, and Chrysler combined.

The market gets smoked for 1/4 Trillion in a single name, and we're trading at the highs. Go figure.

THAT'S BECAUSE APPLE ISN'T A SHADOW BANK PILLAR, NATCH.

APPLE IS A TOY MANUFACTURER. FANNIE AND FREDDIE WERE THE FOUNDATION OF THE MORTGAGE/HOUSING MARKET AND SUPPLIERS TO ALL THE SOVEREIGN WEALTH FUNDS.

[Demeter]

7. UK to Say "Goodbye" to EU? (CONTINUATION)

The UK will have a referendum in 2017 to determine if it wants to stay in the EU. That's so far away that it has no consequence today. I do think this sets up as a "big deal" at one point in the future.

Looking at the calendar, there is something that will be emerging at the same time the UK referendum is due. The big economies in the EU have all agreed to a transaction tax. This tax will come to only .01% on turnover of stocks, bonds and derivatives, but it will devastate the domestic markets in France, Germany, Netherlands and Italy. As a result, London will get another boost as the financial capital in Europe.

The folks in the UK will be well aware of the influx of foreign traders, the capital they bring in, and the office space they use. No doubt, the Brits will be laughing at the EU for creating their success.

It just might prove that the EU's transaction tax becomes the reason why the UK votes to opt out. The TT will prove that the EU has no clue how to run an economy. If that is how it plays out, I will get a laugh.

THE ONLY WAY SUCH A TAX WILL WORK IS IF EVERY NATION INSTITUTES ONE...WITH THE EXCEPTION OF THOSE ECONOMIES THAT NOBODY WOULD PUT MONEY IN. I AM HOPEFUL THAT HAPPENS.

[Demeter]

8. Nuclear Power Would Not Exist In a Free Market

http://www.zerohedge.com/contributed/2013-01-25/how-can-we-reconcile-freedom-loving-libertarianism-tough-prosecution-fraud#comment-3185112

Initially, it is undisputed that nuclear power plants would not exist if operators had to obtain funding and insurance through the free market. Private insurers won’t touch nuclear energy. Investors run the other way, because the odds of losing all of their investment are so high.

No private company in the world would operate a nuclear plant unless the government put a very low cap on liability. In many parts of the world, governments cap liability at a mere $13 billion dollars. This is a little insane, given that “the risk of a nuclear catastrophe … could total trillions of dollars and even bankrupt a country”.

Indeed:

http://www.washingtonsblog.com/2011/04/nuclear-overseers-are-fake-agencies-funded-and-controlled-by-the-nuclear-power-industry.html

If there was a free market in energy, nuclear power would be over … immediately.

AP notes:

Nuclear power is a viable source for cheap energy only if it goes uninsured.
***
Governments that use nuclear energy are torn between the benefit of low-cost electricity and the risk of a nuclear catastrophe, which could total trillions of dollars and even bankrupt a country.
***
The cost of a worst-case nuclear accident at a plant in Germany, for example, has been estimated to total as much as €7.6 trillion ($11 trillion), while the mandatory reactor insurance is only €2.5 billion.

“The €2.5 billion will be just enough to buy the stamps for the letters of condolence,” said Olav Hohmeyer, an economist at the University of Flensburg who is also a member of the German government’s environmental advisory body.

The situation in the U.S., Japan, China, France and other countries is similar.
***
“Around the globe, nuclear risks — be it damages to power plants or the liability risks resulting from radiation accidents — are covered by the state. The private insurance industry is barely liable,” said Torsten Jeworrek, a board member at Munich Re, one of the world’s biggest reinsurance companies.
***
In financial terms, nuclear incidents can be so devastating that the cost of full insurance would be so high as to make nuclear energy more expensive than fossil fuels.
***
Ultimately, the decision to keep insurance on nuclear plants to a minimum is a way of supporting the industry.

“Capping the insurance was a clear decision to provide a non-negligible subsidy to the technology,” Klaus Toepfer, a former German environment minister and longtime head of the United Nations Environment Programme (UNEP), said.

U.S. News and World Report reports:

The disaster insurance for nuclear power plants in the United States is currently underwritten by the federal government, Cooper says. Without that safeguard, “nuclear power is neither affordable nor worth the risk. If the owners and operators of nuclear reactors had to face the full liability of a Fukushima-style nuclear accident or go head-to-head with alternatives in a truly competitive marketplace, unfettered by subsidies, no one would have built a nuclear reactor in the past, no one would build one today, and anyone who owns a reactor would exit the nuclear business as quickly as possible.”

In other words, this is not a free market. Instead, the public has funded the nuclear industry. As such, we - the owners - should get some control over how nuclear plants operate. Likewise, the government created the mega-banks, big oil and the other mega-corporations.

[Demeter]

9. Free Market Champions Demand Prosecution of Fraud (CONTINUATION)

A strong rule of law is the main determinant of prosperity. On the other hand, failure to prosecute fraud is destroying our prosperity.

Nuclear meltdowns, the financial crisis and the Gulf oil spill all happened for the same reason: fraud to make a few more pennies, and a subsequent cover-up to try to protect the wrongdoers and continue "business as usual".

This is not free market economics.

Indeed, the father of free market economics - Adam Smith - leading Austrian economists, and other free market advocates are for the prosecution of fraud:

There is a widespread myth that free market supporters are against regulation or prosecuting fraud.

In fact, Adam Smith – the father of free market capitalism – was for regulation of banks, and believed that trust is vital for a healthy economy. Because strong enforcement of laws against fraud is a basic prerequisite for trust, Smith would be disgusted by the lack of prosecution of Wall Street fraudsters today.

Smith railed against monopolies and their corrupting influence. And Smith was pro-regulation, so long as the regulation benefited the little guy, as opposed to the wealthiest:

When the regulation, therefore, is in support of the workman, it is always just and equitable; but it is sometimes otherwise when in favour of the masters.

Richard Posner – one of the leading proponents over the course of many decades for removing the reach of the law from the economy – has now changed his mind. So has another leading proponent of deregulation and turning a blind eye towards fraud: Alan Greenspan. While some promoters of a fake version of Austrian economics are anti-regulation and against prosecuting fraud, the main Austrian economists were unambiguously for them.

William K. Black – professor of economics and law, and the senior regulator during the S&L crisis – notes that leading Austrian free market economists said that fraud must be prosecuted:

Real Austrian economists … hate elite frauds and want them prosecuted vigorously. Ludwig von Mises and Friederich Hayek are the two most famous Austrian economists.

Hayek, F.A. The Road to Serfdom

To create conditions in which competition will be as effective as possible, to prevent fraud and deception, to break up monopolies— these tasks provide a wide and unquestioned field for state activity.

The Constitution of Liberty

There remains, however, one other kind of harmful action that is generally thought desirable to prevent and which at first might seem distinct. This is fraud and deception. Yet, though it would be straining the meaning of words to call them ‘coercion,’ on examination it appears that the reasons why we want to prevent them are the same as those applying to coercion. Deception, like coercion, is a form of manipulating the data on which a person counts, in order to make him do what deceiver wants him to do. Where it is successful, the deceived becomes in the same manner the unwilling tool, serving another man’s ends without advancing his own. Though we have no single word to cover both, all we have said of coercion applies equally to fraud and deception.

With this correction, it seems that freedom demands no more than that coercion and violence, fraud and deception, be prevented, except for the use of coercion by government for the sole purpose of enforcing known rules intended to ensure the best conditions under which the individual may give his activities a coherent, rational pattern…..

Liberty not only means that the individual has both the opportunity and the burden of choice; it also means that he must bear the consequences of his actions…. Liberty and responsibility are inseparable.

Mises, L.

Government ought to protect the individuals within the country against the violent and fraudulent attacks of gangsters, and it should defend the country against foreign enemies.

Black also notes that fraud is a leading cause of financial bubbles and malinvestment – two of the greatest sins which Austrian economists rightly fight against.

Unless financial fraud is prosecuted, bubbles will be blown … and when they burst, the economy will tank. Fraud – along with bad Federal Reserve policy – is what causes bubbles in the first place.

[Demeter]

10. Proof Is In the Pudding: Fewer Prosecutions Equals a Worse Economy (CONCLUSION)

Obama has prosecuted fewer financial crimes than any president in decades – less than Ronald Reagan, less than George H.W. Bush, less than Bill Clinton, and less than George W. Bush.

The economy is worse than it has been since the Great Depression, if not before.
See the connection?

Everyone Supports Laws Protecting Contract and Private Property Rights

Even the most radical free market advocates support laws protecting contract and private property rights. In other words, they support the judicial branch of government and the basic laws Congress passes to support such rights.

There are obviously good, pro-competitive laws and bad, anti-competitive laws.

Paul Craig Roberts – a true conservative, who was a Wall Street Journal editor and Assistant Secretary of the Treasury under Ronald Reagan, and is widely credited with being the “father of supply-side economics” – points out:

Regulation can increase economic efficiency and … without regulation external costs can offset the value of production.
***
Thirty-three years ago in an article in the Journal of Monetary Economics (August 1978), “Idealism in Public Choice Theory,” I developed a model to assess the benefits and costs of regulation. I argued that well-thought-out regulation could be a factor of production that increases GNP. For example, regulation that contributed to the quality and safety of food and medicines contributed to specialization in production and lower costs, and regulations enforcing contracts and private property rights add to economic efficiency.

On the other hand, bureaucracies build their empires and extend their regulations into the realm of negative returns. Moreover, as regulations increase, economic managers spend more time in red tape and less in productive activity. As rules proliferate, they become contradictory and result in paralysis.

I had hopes that my analysis would result in a more thoughtful approach to regulation, but to no avail. Liberals continued to argue that more regulation was better, and libertarians maintained than none was best.

AND THAT'S WHERE THE BRAINS LEAK OUT-WHEN IDEOLOGY TRUMPS RATIONALITY AND REALITY.

[tclambert]

11. I'd like to see thorium reactors. Thorium is more plentiful and way safer than uranium.

You can hold thorium in your hand and it won't kill you. (You'd be completely safe if you wore a glove.) You can't make a bomb out of it. It's not even good for a dirty bomb, since the radiation from it is weak enough to shield against with a few inches of air. Yet the kind of thorium reactor we used to have could extract far more energy from a given amount of thorium than from the same amount of uranium. And it had passive safety systems (if things went really bad, it would automatically shut itself off).

We abandoned thorium reactors precisely because you can't make bombs out of it. Bomb-making was the big driver of nuclear technology here in the US.

Plus, it was named for Thor, God of Thunder.

[Demeter]

14. That's got to be the #1 worst reason to foist nuclear reactors on the populace

so it makes bomb material.

Frankly, I wouldn't be the least bit surprised. After all, the only reason we have a highway system is Eisenhower wanted to move troops across the nation quickly...he liked the German Autobahn.

If we could militarize regulation of the banksters, our problems would be over.

But it's precisely that the banksters hold all the strings and constantly pull them.

[tclambert]

16. That really was the reason. The military wanted to make bombs.

Or more exactly, the militarists wanted our nuclear programs to focus on bomb-making. The guy who championed thorium reactors, Alvin Weinberg, was told by a Congressman, "If you are concerned about the safety of reactors, then I think it may be time for you leave nuclear energy."

[Demeter]

18. Talk about the Dark Side

Makes Star Wars look like a history book

[AnneD]

42. In a free market...

GMO crops, animals, etc could not exist either. Every market they have been introduced to has flatly refused them. They have to resort to confusing labels, if labeled at all, law suits against farmers whose farms are inadvertently cross pollinated by wind or bees, and law suits to force an unwilling market to take their substandard products.

I have been forced to give up many foods that I use to enjoy because I know the market is potentially flooded with GMO products.

[Demeter]

48. Good Point.

There are a lot of dangerous manufacturing processes not visible to the naked public eye in that category, too.

[AnneD]

54. Not being visible....

is part of the strategy. Again, we have devolved to the days before the clean food and drug act. There are plenty of Sinclair Lewis' out there blowing the whistle, the public has spoken their minds, but the government is ignoring the results and the companies are rewriting the law to suit themselves.

[Demeter]

12. Do Anti-Law Advocates Really Want Anarchy?

...the same Founding Father who argued for periodic revolutions to keep the government honest also argued against tearing down something unless you have something better in mind to replace it? Thomas Jefferson, the most vocal advocate of the citizens’ right to revolt to ensure honest government also cautioned against tearing something down unless it was for the express purpose of replacing it with something better.

Real, deep-thinking anarchists (as opposed to those using fake anarchy philosophy in order to promote lawlessness by the super-elite) are not for destroying all organization. Instead, they argue for self-organization and self-regulation...JP Morgan and Goldman Sachs aren’t reining in one another’s fraud. Bank of America and MF Global didn’t police each other’s fraud. Tepco and BP didn’t make sure the companies made accurate reports about their safety measures. Solyndra and Koch Industries didn’t guard against abuse by the other company.

So if one wants to argue that the Federal government should not regulate financial players, fine! (perhaps our country is too big and complex to manage, and the federal government has become too corrupt) … but who should? The states? Cities? Communities? Neighbors?

Human beings have the ability to form social contracts. Our D.C. government has largely breached it social contract with the people. But we shouldn’t tear down the federal government unless we replace it with something better. No one wants to tear down the state of organization so completely that we go back to monkeys (without the ability to talk), or one-celled critters . . . so the question is how do we want to organize? Do you want to live as a “savage”? In reality, the natives had survival skills, cultural traditions, and knowledge developed over many hundreds or thousands of years (including knowledge gained before the migration from Asia to America), stored in the database of oral traditions. The settlers had traditions and knowledge as well. If we tear away all of that organization, life is going to be pretty challenging.

It is easy for a teenager to criticize his parents, but a lot harder to actually create a better adult life for himself. A teenager looks silly and immature when he criticizes everything his parents do without understanding the challenges he’ll face as an adult. But a young person who rebels against his parents and then creates a better adult life is doing important and heroic work. In other words, anarchy as an economic model could work if economic players organized in such a way as to police against fraud and criminal behavior (the equivalent of pulling out a knife or taking out someone’s kneecap in the middle of a football game). This is a long-winded way of saying that we should not stop the government from enforcing fraud laws unless we come up with a more effective way to stop fraud.

http://www.zerohedge.com/contributed/2013-01-25/how-can-we-reconcile-freedom-loving-libertarianism-tough-prosecution-fraud#comment-3185112

[Demeter]

13. The Real Problem ... (CONCLUSION)

While liberals tend to distrust big corporations and conservatives tend to distrust the federal government, it is really the malignant, symbiotic relationship between the two is the root problem.

Too much government overreach? Giant unaccountable corporations?

Maybe ... but the root problem is that corrupt government officials and corrupt corporate fatcats have merged into a crime syndicate.

Do you get it? Before we can have a real free market, we need to burst the bubble of fraud.

Before we can have a functioning government, we need to stand up to corrupt government officials.

We all need to step out of the left-right dichotomy which is distracting us and dumbing us down.

We need liberty and justice.

[AnneD]

45. Fraud is like a drop of blue dye....

in a gallon of water. A drop isn't much in comparisson to a gallon but it taints the whole gallon. You can still see it.


From an ex-aquarium keeper that use to treat her fish for anchor worms with a drop of methyl blue.

[Demeter]

15. Words to Live By

“He may look like an idiot and talk like an idiot but don't let that fool you. He really is an idiot.”

Groucho Marx

[Demeter]

17. Is Fed Monetary Policy Really Marxist? (HE MEANS GROUCHO...)

http://www.zerohedge.com/contributed/2013-01-25/fed-monetary-policy-really-marxist

CHRIS WHALEN -- Earlier this week I received a missive from my friend John Silvia at Wells Fargo. For an economist of his stature in the industry, his warning was stark:

“While the current housing recovery is welcome, are low interest rates setting us up for an asset price boom again? Current 15-year fixed mortgage rates are 2.66 percent and, according to CoreLogic, the home price index is up 7.4 percent year over year as of November, the highest reading since May 2006. Home prices are rising faster than the mortgage interest rate (top graph), similar to the housing boom of 2004-2006. So, the real interest rate on home buying is now negative 4 percent? We appear to have again entered into an era of a misallocation of credit when the Fed’s support of the housing market has extended so far that we are repeating the same pattern of behavior we promised to avoid. Single-family housing starts rose 8.1 percent in December to a 616,000-unit pace and are up 18.5 percent over the past year. Is this a take off to another period of housing speculation?”

For some time now, the Federal Open Market Committee has been playing in a real life Marx Brothers movie, making up monetary policy as they go in the same way those wonderful characters would ad-lib their lines through whole films. Nobody on the Fed’s staff in Washington can explain what they are doing or why, in part because the last three decades of US monetary policy have been a pretense. We pretend that the “greatest nation on earth” can borrow endlessly against the national patrimony, either explicitly or via inflation. Inflation is the ultimate tax – a steady erosion of value that affects all Americans but that we pretend does not exist.

The corollary of ad-lib monetary policy is bubbles. We live in a world of bubbles instigated and engineered, deliberately or reflexively, by the central bank. Charged with both maintaining “full employment” and price stability, the Fed does neither. Instead we embrace a kind of silly neo-Keynesian socialism that allows President Obama to declare that we cannot balance the federal budget because it would be unfair. The Republicans, mind you, are hardly better, preferring to cave into Democratic demands for endless increases in federal spending. And both parties know that consumers and working people in particular bear the ultimate cost via steady inflation on the cost of basic necessities. While the Fed pretends to display some degree of rectitude with respect to inflation and consumer prices, the reality is that the central bank is at once the enabler and apologist for the now familiar cycle of boom and bust that is engineered in Washington. Members of Congress and federal agency heads spend lip service on preventing systemic risk in markets and capital adequacy for banks, but the real game is nominal growth via excessive debt creation and big federal deficits. Even as the Fed has been dealing with the ill-effects of the 2007-2009 subprime boom, they create the circumstances for numerous new bubbles in multiple asset classes. Consider two examples, Apple Computer (AAPL) and housing. In both cases, the zero rate policies by the Federal Open Market Committee are driving up the price of an entire asset class. You could argue that AAPL, at its current $400 billion market cap, comprises an asset class all by itself, kind of a surrogate for the entire technology sector. But inflation is low, right? Higher and higher the market cap of AAPL went, this even though anyone who has followed the tech sector knew that the stairway to heaven built upon handset sales must eventually end badly. And so it has. Of course while many previously happy campers may no longer be happy with AAPL, the fact is that stock prices are headed north. The migration, some might say exodus, out of bonds and into stocks is well advanced and driven by fear that the FOMC is getting ready to shift policy after years of easy money. My old boss Jack Kemp (R-NY) used to say that “a rising tide lifts all boats.” He spoke then of real economic growth, but in this case it is merely the rising tide of monetary inflation.

As John Silvia notes in his rant above, the real rate of inflation clearly makes current interest rates deeply negative, yet the US economy is barely moving. Decades of self-delusion by the greatest ever generation has left the US economy in a situation where the Fed can print money with reckless abandon and almost nothing happens with the real economy. Somebody gently break the news to our chief economist Paul Krugman and his new sidekick, the former Republican Bruce Bartlett...But of course there is good news. Even though the real economy of jobs and private business is under siege, the Fed can certainly create new bubbles. The supposed recovery in the housing sector is a case in point. Most of the increase in home prices can be traced to a handful of states where the boom was especially bad and investors now dominate the market. Driven to desperation by low investment returns, armies of doctors, dentists and private equity bankers are paying retail prices for foreclosed homes. The strategy? Pricey rentals in sand states with leverage. And Chairman Bernanke and the rest of the FOMC want us to thank them for this great accomplishment? The spectacle of Blackstone spending billions in 2012 to buy foreclosed homes in markets like Tampa, FL, speaks volumes about the speculative nature of the “recovering” housing sector. But while relatively warm markets such as FL, AZ and CA are showing significant recoveries in terms of housing prices, at least for now, many judicial states remain mired in foreclosure backlogs that still stretch ahead for years to come. Because Barack Obama and Tim Geithner refused to restructure the truly sick parts of the US housing sector (and the zombie banks with these exposures), only sectors where speculative capital can be deployed quickly and easily are showing signs of life. You don’t see private equity firms buying homes in Scarsdale, NY, or Greenwich, CT, now do you? Even ignoring the horrible effects of SS Sandy, was NJ housing really recovering?

http://www.tampabay.com/news/business/realestate/blackstone-to-buy-1-bil...

So welcome to the new age of financial bubbles. Just as the Fed did in 2001, the central bank has stoked the hell furnaces of future inflation and financial contagion. Many parts of the US economy are so badly damaged that they will not participate in this latest round of economic pump priming, but those sectors that are able to access easy money are likely to soar in future weeks and months. The good news is that stocks will go up, but bonds will go down and the cost of everything else will be higher. As any Marxist knows, “Time flies like an arrow. Fruit flies like a banana.” Equities will not do well because banks have good fundamentals or consumer stocks see strong demand. Quite the opposite. But, to paraphrase our friend Marc Faber, equities are one of the best asset classes in times of hyperinflation. This rule holds even if it means that you only lose most of your value in stocks (in real, inflation-adjusted terms) while mere savers get wiped out completely by financial repression and the heightened market volatility which comes along with Fed efforts to fix the last crisis. IN THAT CASE, I WOULD THINK COMMODITIES THE ONLY REAL SAFE BET....DEMETER...When your central bankers make up policy as they go and with an eye on politics first and foremost, you could hardly expect a better outcome. This is the real strength of democracy, you understand. Another Marxist principle to bear before us, almost as a torch in the cold darkness, is the rule of relativity as it applies to national economics. “Those are my principles,” Marx said. “And if you don't like them... well, I have others.”

[Demeter]

19. Hamptons Prices Soar To Record As Lloyd Blankfein Parks $33 Million In 8,000 Square Foot Mansion

http://www.zerohedge.com/news/2013-01-24/hamptons-prices-soar-record-lloyd-blankfein-parks-33-million-8000-square-foot-mansio#comment-3185148

If there was any confusion where New York's uberwealthy were scrambling to dump their money in December ahead of the now official tax hike on the wealthiest, we now know: some two hours north on the Long Island Expressway, or the Hamptons to be precise. Bloomberg reports: "Home prices in New York’s Hamptons, the resort towns on the Long Island coast, rose to the highest on record as deals at the upper end of the market surged before expected tax increases for sellers. The average price of homes that sold in the fourth quarter jumped 35 percent from a year earlier to $2.13 million, the highest since Miller Samuel Inc. begin tracking Hamptons sales in 1999, the appraiser said today in a report with brokerage Douglas Elliman Real Estate. It was only the second three-month period that the average purchase price topped $2 million, said Jonathan Miller, the New York-based firm’s president."

Needless to say, when a handful of the 0.001%, and quite close to the New Normal discount window - i.e., the Fed's excess reserves - purchase homes with no price discrimination, it has the same impact as when foreign oligrachs come to the US to launder illgotten cash (with the NAR's blessings), sending prices up some 35% in one year. And since the average price of all houses is dragged higher as a result, TV pundits can spin it as a housing recovery, and get consumers to consume even more by "charging it", making the abovementioned Hamptons' home purchasers even richer: there's your recovery. And it is a recovery, all right, for some: like Lloyd Blankfein who just parked another $32.5 million in prime 8,000 square foot Bridgehampton mansion set on some 7.3 acres.

Goldman Sachs Group Inc. (GS) Chief Executive Officer Lloyd C. Blankfein bought a seven-bedroom home in New York’s Hamptons that was listed for $32.5 million, a person with knowledge of the deal said.

Blankfein, 58, took title to the property on Ocean Road in Bridgehampton in recent weeks, said the person, who asked not to be named because the transaction hasn’t been made public. The person didn’t disclose the price for the home, which was most recently offered for $32.5 million, according to Zillow.com.

Property records reported by LexisNexis list the owner as ‘Fein, Blank.’ The sellers were Matthew Mallow and his wife, Ellen Chesler, records show. In August, Mallow, who was named earlier this year as general counsel at BlackRock Inc. (BLK), and Chesler, a senior fellow at the Roosevelt Institute, hosted a fundraiser at the house for President Barack Obama that was attended by Vice President Joe Biden, according to reports in the New York Post and on the website of the Sag Harbor Express.

“For the most discerning, this classic Hamptons estate- home, situated on magnificent grounds, offers the ideal blend of every modern convenience and amenity within its early 20th- century construction,” according to a June 2009 rental listing for the property on StreetEasy.com, a real estate website.

The home, with six full bathrooms, includes a tennis court, “sculpted gardens,” a swimming pool, and “a winding driveway to a home of which dreams are made,” according to the rental listing.
...
The listing price of the Hamptons home is more than what Blankfein spent for his Manhattan apartment at 15 Central Park West, according to a February 2006 regulatory filing by Goldman Sachs. He paid $27 million for that property, the filing shows.

Goldman must pay well:

Blankfein has seen his annual pay drop since he was awarded a record-setting $54 million in 2006 and $68.5 million in 2007. His 2011 compensation was $12.4 million, which included a $3 million cash bonus, $7 million in restricted stock, $2 million in salary and $449,600 in other benefits.

Last month, Blankfein reaped $5.93 million by exercising 10-year-old stock options and selling the shares, leaving him with Goldman Sachs stock worth about $209 million at yesterday’s closing price, according to company filings.

Yes it does. And now back to the Hamptons:

“There’s clear evidence of this year-end rush in anticipation of higher taxes,” Miller said in an interview. “We just had a lot of sales at the upper end of the market because the more affluent were more likely to be proactive.”

There were 49 sales in the quarter for more than $5 million, the most since 2006, when Miller Samuel began tracking that data. The quarterly average for the past six years is 23 such deals, Miller said. High earners were expecting to see their tax burden rise as Congress negotiated a budget deal into the new year. The top rate on dividends and capital gains climbed on Jan. 1 to 23.8 percent from 15 percent, including a 3.8 percent tax from the 2010 health-care law.

The median price for all luxury transactions, the top 10 percent of all sales by price, climbed 17 percent from a year earlier to $7 million, Miller Samuel and Douglas Elliman said.

Be advised: "Like, Crazy" is a technical term

“December was, like, crazy here,” said Judi Desiderio, president of Town & Country Real Estate in the Hamptons, which released a report on the market on Jan 18. The year “was like a snowball rolling downhill.”

The dollar volume of homes that changed hands in the fourth quarter surged 51 percent from a year earlier to $771 million, according to Town & Country. The median sale price rose 19 percent to $975,000.

It goes on and on and on, for those for whom, as we said above, there is a recovery. Details can be found here: http://www.bloomberg.com/news/2013-01-24/hamptons-average-home-price-hits-record-on-luxury-surge.html?utm_medium=referral&utm_source=t.co

For everyone else, here are pictures of the "Fein, Blank" new home located in Bridgehampton:









MORE AT LINK

[Demeter]

20. JAM, EVERY OTHER DAY

Jam tomorrow, jam yesterday, but never any jam today---Alice's White Queen

[Demeter]

22. U.S. Bank Deposits Drop Most Since 9/11 Terror Attacks

http://www.bloomberg.com/news/print/2013-01-23/u-s-deposits-post-biggest-drop-since-9-11-as-fdic-ends-support.html

Clients of the largest U.S. banks withdrew funds this month at the fastest weekly pace since the Sept. 11 attacks as a deposit-insurance program ended and customers tapped into their year-end cash hoards. Net withdrawals at the 25 largest U.S. lenders totaled $114.1 billion in the week ended Jan. 9, pushing deposits down to $5.37 trillion, according to Federal Reserve data released last week. The magnitude of the drop was second only to the decline after the Sept. 11, 2001 terrorist attacks, according to Jason Goldberg, a New York-based analyst at Barclays Plc.

Customers may be moving money no longer insured by the U.S., drawing down year-end balances and investing in advancing equity markets. A Federal Deposit Insurance Corp. backstop, the Transaction Account Guarantee program, ended last month, prompting some analysts, investors and trade organizations to predict it could drive funds from the banking system.

“What you are seeing now is probably TAG money,” Subadra Rajappa, a fixed-income strategist at New York-based Morgan Stanley, said in a phone interview. “Some of the banks’ corporate customers have said they were going to take the money out” if the program expires as it did, she said.

The transaction-account protections were introduced in the wake of the 2008 credit crisis and had guaranteed about $1.5 trillion in non-interest-bearing accounts above the FDIC’s general limit of $250,000. The program expired Dec. 31. Deposits closed the year at about $5.4 trillion, the highest month-end total in 2012 and more than $500 billion higher than at the end of 2011, according to Fed data...

http://www.bloomberg.com/news/print/2013-01-23/u-s-deposits-post-biggest-drop-since-9-11-as-fdic-ends-support.html

[kickysnana]

40. Copays on medical bills, flu. Delay in tax refunds. n/t

[Demeter]

23. Morgan Stanley shaves CEO Gorman’s pay

http://www.marketwatch.com/story/morgan-stanley-shaves-ceo-gormans-pay-2013-01-24?siteid=YAHOOB

Morgan Stanley Chairman and Chief Executive James Gorman is taking a pay cut for 2012, and will receive a total of $6 million as well as a long-term incentive award, according to people familiar with the situation. This will be the second consecutive year that Gorman’s compensation has been cut. In 2011, he received $10.5 million, down from $14 million the year before. Gorman’s $6 million 2012 pay package comes in three parts: an $800,000 base salary, a $2.6 million option award and a $2.6 million deferred-cash award to be paid over 3 years. The compensation plan is similar in structure to the bonus plan given to the bank’s executives, with regards to the deferred cash awards. The news was first reported Thursday by The Wall Street Journal.

Morgan Stanley MS +0.89% stock was up almost 25% over the past 12 months and the firm’s fourth-quarter results exceeded analysts’ expectations. But the firm has struggled more than its peers to turn its fortunes around following the 2008-09 financial crisis.

Gorman’s pay cut won’t be as big as Jamie Dimon’s, the chief executive of J.P. Morgan Chase & Co. JPM +1.25% , according to reports. Dimon’s cut in compensation was close to 50% from last year. Gorman’s pay cut reflects losses in revenues for Morgan Stanley in 2012 from the year earlier.

[Demeter]

25. Morgan Stanley Bankers Sold Off 'Shitbag' CDOs With 'Nuclear' Capabilities To Clients

http://www.huffingtonpost.com/2013/01/23/morgan-stanley-cdo-emails_n_2535784.html?utm_hp_ref=business

It's becoming depressingly familiar: Bankers joke openly in emails about a toxic investment they're creating. Bankers sell said toxic investment to clients while betting against it. Everybody loses money, nobody goes to jail. Rinse, repeat, crash the economy.

The latest round of emails was produced in a lawsuit by a Chinese bank suing Morgan Stanley over a $500 million subprime-mortgage collateralized debt obligation the bank created and marketed as "Stack 2006-1." ProPublica's Jesse Eisinger writes that documents in the case show Morgan Stanley bankers had very different ideas about what it should be called.

Those names, according to internal emails from early 2007 unearthed in the case, included "Shitbag," "Nuclear Holocaust," "Subprime Meltdown" and "Mike Tyson's Punchout." The bankers were clearly kidding. They floated some nice names, too, before settling on "Stack." More troubling is what the rest of the documents show, according to Eisinger: Morgan Stanley was stacking its shitbags of subprime garbage high while knowing full well that the whole thing was sure to topple and make a huge mess:

People across the bank understood that the American housing market was in trouble. They took advantage of that knowledge to create and then bet against securities and then also to unload garbage investments on unsuspecting buyers.

So why aren't any of these people in jail? For one thing, they have a fairly sturdy defense. Morgan Stanley says the Chinese bank and other investors were big boys in the big leagues and should have known what they were buying. The bank says it warned investors in offering documents that they might bet against the CDOs they were creating. And Morgan Stanley also points out that it owned a chunk of Stack and lost money on it. It also lost money when it got caught holding too many subprime shitbags when the crisis erupted. U.S. officials have been spooked enough by these defenses to stay far, far away from criminal charges in any of these cases, as a "Frontline" documentary Tuesday night showed again in depressing detail. In order to prove that these bankers committed fraud, prosecutors would have to prove criminal intent. Apparently the many documents that have turned up already -- in this case and in the case of the Goldman Sachs ABACUS CDO and the various lawsuits against Bear Stearns for creating CDOs its bankers described in emails as "dog" and "shit breather" and "sack of shit" -- are not enough to prove criminal intent...

SOUNDS LIKE A CALL FOR "WET WORK" BY MERCENARY ASSASSINS....THE ONLY WAY TO OBTAIN JUSTICE AND STRIKE THE FEAR OF VENGEANCE IN BANKSTERS

[Demeter]

24. 'Gozi' computer virus hit bank accounts, officials say; 3 charged

http://www.latimes.com/business/la-fi-cyber-crime-20130124,0,1445125.story

U.S. prosecutors say a Russian, a Latvian and a Romanian have been arrested for spreading a virus to steal online banking data worldwide. Federal prosecutors said they had foiled an international cyber-crime ring that targeted bank accounts in the U.S. and around the globe. The criminal charges, disclosed Wednesday, highlight the vulnerabilities of online consumer banking, which has become more popular in the digital age. It also comes just months after most every major U.S. bank suffered a relentless round of online attacks by Middle Eastern hackers. In the case unveiled Wednesday, three men — a Russian, a Latvian and a Romanian — allegedly created and spread a virus they called "Gozi" that infected more than 1 million computers around the globe, including at least 40,000 in the United States. The virus and other malicious software infected individuals' and businesses' computers, and then stole log-in information for online banking and other accounts. One program even imitated a bank's website, tricking users into giving away their PINs and personal information, such as their mothers' maiden names.

"Their bank heists required neither a mask nor a gun, but a clever computer program and an Internet connection," Preet Bharara, the U.S. attorney in Manhattan, told reporters Wednesday.

Referencing a quotation often attributed to the notorious bank robber Willie Sutton, Bharara said, "Cyber criminals target banks too because that's where the money still is."

Although the Gozi virus' reach spanned the globe — infecting computers in Turkey, Poland and Finland, among other countries — Bharara could not say how many U.S. customers' accounts had been breached. Nor could he say how much was stolen from the accounts, aside from alleging "tens of millions" of dollars in losses globally. He said the investigation was continuing...NASA also fell victim to the virus. About 190 of the space agency's computers came down with the bug between 2007 and 2012, according to court documents. Extracted data allegedly included log-in information for a NASA email account, Web browsing histories and Google chat messages. Gozi's mastermind was Nikita Kuzmin, a Russian programmer who created the virus in 2005, authorities said. The virus infiltrated computers through spam email or seemingly innocuous .pdf document files. Prosecutors said Deniss Calovskis, a Latvian who went by the nickname Miami, allegedly helped develop "Web injects," such as the phony bank site. Mihai Paunescu, a Romanian known by his online handle Virus, ran what authorities said was essentially an online bazaar for cyber criminals who bought or leased the virus and helped spread it around the world...Kuzmin was earlier arrested while in the U.S. and has pleaded guilty. He has been cooperating with authorities, Bharara said. Kuzmin's attorney, David Gordon of New York, did not respond to a phone message Wednesday. Calovskis was arrested in Latvia in December; Paunescu was arrested in Romania in November. Both have been indicted and are awaiting extradition to the U.S.

Bharara, who in interviews and speeches has been increasingly sounding the alarm over cyber threats, said his office would bring similar cases later this year.

"This case should serve as a wake-up call to banks and consumers alike, because cyber crime remains one of the greatest threats we face, and it is not going away any time soon," Bharara said. "It threatens our financial security and our national security."

The alleged scheme is separate from an onslaught of cyber attacks last year against U.S. banking websites that were believed to have been orchestrated by a hacking group based in the Middle East. Those were "distributed denial of service" attacks, which aim to shut down websites. Banks such as Citigroup Inc., JPMorgan Chase & Co. and Wells Fargo & Co. were victims of the attacks. Although the banks said the attacks did not breach customer accounts, they found their customer-facing websites slowed or briefly crippled....Marcus Asner, a former federal prosecutor now at the New York law firm Arnold & Porter, said the alleged Gozi ring showed "astonishing sophistication" and highlighted an emerging high-tech challenge for law enforcement and the banking industry. "It's hard to say who is ahead in the game," Asner said. "It's much more of a Wild West still."

[Demeter]

26. Cook one good meal....

and your children will expect this miracle 3 times a day....

The Kid wants a real breakfast....guess I have to go.

Why am I beginning to feel like Phyllis Diller?

It's snowing (and the temperature is DOUBLE what it was yesterday, proving that it has to warm up to snow...why, it's 16F! Windchill is 6F, though. Looks like snow will continue through the WEEKEND (hint, hint))

I was thinking of something like "Nothing Secedes Like Success" or similar, given that Catalonia has done a bunk....

[Fuddnik]

27. I'm contemplating making a good breakfast.

But I don't want to spoil myself. Maybe lunch after the dog park.

[xchrom]

28. i am in a mood...the weekend had better be good

[xchrom]

29. Krugman Takes Opera Bow as Estonia Sings Blues on Euro Wages

http://www.bloomberg.com/news/2013-01-24/krugman-takes-opera-bow-as-estonians-sing-blues-on-euro-wage-gap.html

“Stimulate!” sings Paul Krugman’s character in a tongue-in-cheek cantata about his spat with Estonia’s president over austerity. The Nobel Prize winner’s refrain is striking a chord with the nation’s citizens.

Pride at swallowing spending cuts to defeat the worst economic slump since communism fell is dwindling among Estonians, who want higher wages as euro adoption exposes a gulf in living standards with Europe. Krugman, a proponent of deficit-led stimulus, drew an Internet rebuke from President Toomas Ilves last year by downplaying the country’s revival.

Wage frustrations show that the return of growth is denting people’s willingness to accept indefinite austerity even in the Baltic region, which European Union leaders have held up as a blueprint to solve the continent’s debt woes. Estonians, who credit choir-singing traditions for the bloodless return of independence two decades ago, are demanding the EU’s fastest pay increases as they seek reward for their economic pain.

“It’s said that Estonia became independent through singing,” Eugene Birman, a Latvian-born U.S. composer who co- authored the cantata, a short operatic piece, said by e-mail. “We’re taking the closed-door arguments and suppressed emotions from this financial crisis and thrusting them onto the stage.”

[xchrom]

30. Euro Jumps as Bank Loan Repayments Exceed Estimates; Yen Drops

http://www.bloomberg.com/news/2013-01-25/euro-extends-gain-versus-dollar-yen-after-ecb-ltro-announcement.html

The euro rose to its strongest level against the dollar in 11 months as the European Central Bank said banks will hand back a greater amount of three-year loans than analysts estimated, boosting short-term borrowing costs.

The 17-nation currency was set for a seventh week of gains versus the yen after the ECB said 278 banks will repay 137.2 billion euros ($184.4 billion) next week, exceeding the 84 billion-euro forecast in a Bloomberg survey of economists. The yen headed for a record run of weekly losses against the dollar as Japanese consumer prices fell. The Korean won slid as Samsung Electronics Co. said a stronger currency dented earnings.

“The repayment is much higher than the market expected and it’s positive for the euro,” said Roberto Mialich, a senior currency strategist at UniCredit SpA (UCG) in Milan. “Banks, which were part of the euro problem, are willing and able to make repayment to the ECB and this will provide further upward momentum.”

The euro gained 0.6 percent to $1.3458 at 9:24 a.m. in New York and touched $1.3470, the strongest level since Feb. 29. Against the yen, it appreciated 1.4 percent to 122.48 and reached 122.77, the highest since April 11, 2011.

[xchrom]

31. Sweden Warns U.S. Against Targeting Welfare With Tax Deficit

http://www.bloomberg.com/news/2013-01-25/u-s-can-t-afford-eu-welfare-given-low-tax-bias-reinfeldt-says.html

The U.S. will never be able to afford the kind of welfare benefits enjoyed by Europeans unless it raises taxes, Swedish Prime Minister Fredrik Reinfeldt said.

“It’s not sustainable for a country to try to have European levels of expenditure with taxation levels like the United States has,” Reinfeldt said today in an interview with Bloomberg Television’s Francine Lacqua in Davos, Switzerland. “That’s not possible.”

Cradle-to-grave welfare doesn’t need to erode public finances provided a sustainable revenue policy is in place, Reinfeldt said. The largest Nordic economy, which has the second-highest tax burden of industrialized countries after Denmark, has reduced its debt load as a percentage of gross domestic product every year since 2009. The U.S. has the fourth- smallest tax burden relative to GDP, after Mexico, Chile and Turkey, according to figures provided by the Paris-based Organization for Economic Cooperation and Development.

In the U.S., lawmakers have struggled to strike a balance between spending and taxation, bringing Congress close to testing the nation’s debt ceiling a second time since 2011.

[xchrom]

32. FROM THE START, DREAMLINER JET PROGRAM WAS RUSHED

http://hosted.ap.org/dynamic/stories/A/AP_US_DREAMLINER_DIFFICULTIES?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2013-01-25-03-32-34

NEW YORK (AP) -- The 787 Dreamliner was born in a moment of desperation.

It was 2003 and Boeing - the company that defined modern air travel - had just lost its title as the world's largest plane manufacturer to European rival Airbus. Its CEO had resigned in a defense-contract scandal. And its stock had plunged to the lowest price in a decade.

Two years after the 9/11 terrorist attacks, financially troubled airlines were reluctant to buy new planes. Boeing needed something revolutionary to win back customers.

Salvation had a code name: Yellowstone.

[xchrom]

33. HALLIBURTON 4Q TOPS WALL STREET EXPECTATIONS

http://hosted.ap.org/dynamic/stories/U/US_EARNS_HALLIBURTON?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2013-01-25-09-02-41

HOUSTON (AP) -- Halliburton's net income for the fourth quarter declined 26 percent on pricing pressures in the North American market and one-time charges from the Deepwater Horizon disaster, as well as acquisitions.

Yet adjusted results beat Wall Street expectations, and shares rose 4 percent before the opening bell Friday.

The oilfield services company earned $669 million, or 72 cents per share, for the three months ended Dec. 31. That's down from $906 million, or 98 cents per share, a year ago.

Removing one-time charges and gains, earnings from continuing operations were 67 cents per share.

[xchrom]

34. Extraordinary Images Of The Hottest Country In The World For Untapped Natural Resources

http://www.businessinsider.com/tour-of-myanmars-resources-2013-1?op=1

The hottest emerging economy for resources is Myanmar. It's been a previously ultra-closed society that's now starting to open up.

As Myanmar opens up its economy and western countries lift their sanctions on the country, companies have been flocking there to tap into its resources.

The country is rich in energy, precious stones like jade and rubies, teak, copper, and biomass like charcoal to name a few.

Myanmar reportedly has 11–23 trillion cubic feet in natural gas reserves and 50 million barrels of crude oil reserves. They recently auctioned 18 oil and natural gas blocks.


Myanmar accounts for 80 percent of global teak. Teak is a kind of wood that is extremely popular in Asia and is used to make furniture and boats


Myanmar is rich in precious stones like jade, and prices have skyrocketed because of Chinese demand.


Myanmar is also rich in one of the most precious stones, the blood red ruby. Gems, especially rubies, used to be the third largest source of revenue for the military regime.

[AnneD]

47. Demeter.....

This might make a good WEE topic. I really like last weeks Blue Man WEE.

[xchrom]

35. Banca Monte dei Paschi trades probed in Italy

http://www.bbc.co.uk/news/business-21197589

Shareholders of the world's oldest bank, Italy's Banca Monte dei Paschi di Siena, are meeting to approve a state bailout amid revelations that it concealed loss-making risky trades.

Both regulators and the bank itself are investigating the trades.

The Bank of Italy defended its role in supervising Italian banks, denying knowledge of the trades.

Banca Monte needs 3.9bn euros (£3.3bn, $5.2bn) in government aid to meet European banking rules.

[xchrom]

36. IMF's Olivier Blanchard: Time for UK to consider Plan B

http://www.bbc.co.uk/news/business-21175407

The IMF chief economist has told the BBC that Chancellor George Osborne should consider slowing down austerity measures in his March budget.

"We think this would be a good time to take stock," said Olivier Blanchard, speaking to Radio 4's Today programme.

He also said the global economy was "not out of the woods yet".

In October, Mr Blanchard claimed in an IMF report that austerity had hurt wealthy countries such as the UK far more than most analysts had expected.

[xchrom]

37. Osborne's economic strategy has failed

http://www.guardian.co.uk/business/economics-blog/2013/jan/25/george-osborne-economic-strategy-failed-gdp

The strategy has failed. The public knows it. The International Monetary Fund knows it. The credit rating agencies know it. Even George Osborne knows it, although he can't bring himself to admit as much.

Here is a brief résumé of how things stand for the economy after two and a half years with the coalition government at the helm. National output has just contracted for the fourth quarter in the last five. The only quarter of 2012 in which the economy expanded was the one that contained the London Olympics, and unfortunately for the chancellor these sort of jamborees happen once every half century rather than once every three months.

During 2012 as a whole the economy registered no growth at all. Nothing. Zilch. A big fat zero. The level of gross domestic product is 3% below where it was when the recession started, a weaker performance than during the 1930s. Royal Bank of Scotland says the four-year performance of the economy between 2008 and 2012 is the weakest since the 1930s apart from post-war mobilisations.

Industrial production was to blame for the drop in output in the final three months of 2012, with factory output back to levels last seen in the early 1990s. Rebalancing is a pipedream. Unsurprisingly, the Treasury's deficit reduction programme is well off track. This is an abysmal record.

[xchrom]

38. Cutting trade red tape could boost global economy by $1tn, says WTO

http://www.guardian.co.uk/business/2013/jan/25/cutting-red-tape-boost-global-economy-wto

A deal to cut the red tape that clogs up international trade will provide a $1tn (£634bn) boost to the global economy if it can be agreed by the end of the year, the director general of the World Trade Organisation has said.

Speaking in Davos on Friday, Pascal Lamy said there was a good chance that the most important part of the stalled Doha trade negotiations would be resolved when trade ministers met in Bali in December.

Lamy said there was no chance of an immediate conclusion to the whole round, a complex set of negotiations that includes 20 separate aspects of trade, including manufacturing tariffs, agriculture, services and the rules governing the import and export of goods and services. Talks have been under way since late 2001 and, despite hopes that the re-election of Barack Obama as US president would smooth the way to a comprehensive deal, Lamy was downbeat about the prospects.

"There will be no agreement on Doha by the end of this year. We have known that for some time," he said.

[Demeter]

49. Imagine the results if they cut the crap

and abandoned "austerity for the 99%"

[xchrom]

51. Imagine no WTO. Nt

[Demeter]

52. Imagination is the only thing getting me through these terrible days.

[xchrom]

39. ECONOMIST: EURO CRISIS COULD ERUPT AGAIN THIS YEAR

http://hosted.ap.org/dynamic/stories/E/EU_DAVOS_FORUM_EURO_WOES?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2013-01-25-10-32-38

DAVOS, Switzerland (AP) -- Is the euro crisis over? A leading U.S. economist says not by a long shot.

Even as the head of the European Central Bank talked Friday of "positive contagion" in the markets and predicted an economic recovery for the recession-hit eurozone later this year, economist Barry Eichengreen warned that the debt crisis that has shaken Europe to its core could easily erupt again this year unless European leaders move faster to solve their problems.

While European governments and markets have been breathing easier in recent months after years of turmoil, it's no time for complacency, said Eichengreen, who has chronicled the Great Depression and explored the consequences of a breakup of the euro currency used by 17 nations.

"Nothing has been resolved in the eurozone, where markets have swung from undue pessimism to undue optimism," Eichengreen told The Associated Press in an interview at the World Economic Forum in Davos, Switzerland. "They said all the right things last year ... and they've been backtracking ever since."

[DemReadingDU]

41. `Tide' Brings New Meaning to Money Laundering

1/25/13 `Tide' Brings New Meaning to Money Laundering

Jan. 25 (Bloomberg) -- Bloomberg's Scarlet Fu reveals the underground economy based on Proctor & Gamble's Tide laundry detergent. She speaks on Bloomberg Television's "Bloomberg Surveillance."

click for short video
http://www.bloomberg.com/video/-tied-brings-new-meaning-to-money-laundering-JzF83gq5QH6qY0KSvJ7nGA.html

[siligut]

43. Carl Icahn going after Bill Ackman on CNBC right now!

Herbalife, the pyramid scheme scrambling to cover its butt has brought out the crazy. Carl is saying everyone is bullying him and then talking shit to Scott Wapner. Damn.

[siligut]

44. LIVE: CARL ICAHN CALLING INTO CNBC TO FIGHT DIRECTLY WITH BILL ACKMAN

Activist investor Bill Ackman, the founder of $12 billion Pershing Square Capital Management, is on CNBC now after rival Carl Icahn blasted him yesterday on Bloomberg TV.
We're already into the segment, and Icahn called in after the commercial break to respond to Ackman.
It's really, really intense and must-watch television.


Read more: http://www.businessinsider.com/bill-ackman-on-cnbc-2013-1#ixzz2J0j0CE7D

This is hilarious, Scott is keeping his cool.

[siligut]

46. Sorry for the all caps, it is the actual headline

Icahn is losing it, he is claiming Scott is bullying him into confessing something. I believe Herbalife is a crooked company.

[Demeter]

50. Well, they all are, nowadays

The crooked companies have driven the straight ones out of business in every field.

[DemReadingDU]

53. Taibbi: Choice of Mary Jo White to Head SEC Puts Fox In Charge of Hen House

1/25/13 Choice of Mary Jo White to Head SEC Puts Fox In Charge of Hen House
Matt Taibbi

I was shocked when I heard that Mary Jo White, a former U.S. Attorney and a partner for the white-shoe Wall Street defense firm Debevoise and Plimpton, had been named the new head of the SEC.

I thought to myself: Couldn't they have found someone who wasn't a key figure in one of the most notorious scandals to hit the SEC in the past two decades? And couldn't they have found someone who isn't a perfect symbol of the revolving-door culture under which regulators go soft on suspected Wall Street criminals, knowing they have million-dollar jobs waiting for them at hotshot defense firms as long as they play nice with the banks while still in office?

I'll leave it to others to chronicle the other highlights and lowlights of Mary Jo White's career, and focus only on the one incident I know very well: her role in the squelching of then-SEC investigator Gary Aguirre's investigation into an insider trading incident involving future Morgan Stanley CEO John Mack. While representing Morgan Stanley at Debevoise and Plimpton, White played a key role in this inexcusable episode.
.
.
If Barack Obama wanted to send a signal that he's getting tougher on Wall Street, he sure picked a funny way to do it, nominating the woman who helped John Mack get off on the slam-dunkiest insider trading case ever to cross an SEC investigator's desk.

When I contacted Gary today, his take on it was simple. "Obama is not going to clean up financial corruption," he said, "by pinning a sheriff's badge on Wall Street's protector-in-chief."

http://www.rollingstone.com/politics/blogs/taibblog/choice-of-mary-jo-white-to-head-sec-puts-fox-in-charge-of-hen-house-20130125

[Hotler]

55. Reid back off of filibuster reform.

Motherfuck! I'm about to go to my local butcher and have him get me cow's spine and mail it in to Harry Reid.