STOCK MARKET WATCH -- Friday, 14 March 2014

[Tansy_Gold]

[font size=3]STOCK MARKET WATCH, Friday, 14 March 2014[font color=black][/font]

SMW for 13 March 2014

AT THE CLOSING BELL ON 13 March 2014
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Dow Jones 16,108.89 -231.19 (-1.41%)
S&P 500 1,846.34 -21.86 (-1.17%)
[font color=black]Nasdaq 4,260.42 0.00 (0.00%)


[font color=green]10 Year 2.65% -0.10 (-3.64%)
30 Year 3.59% -0.09 (-2.45%)[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
Wall Street on Parade
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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.
02/14/13 Gilbert Lopez, former chief accounting officer of Stanford Financial Group, and former controller Mark Kuhrt sentenced to 20 yrs in prison for their roles in Allen Sanford's $7.2 billion Ponzi scheme.
03/29/13 Michael Sternberg, portfolio mgr at SAC Capital, arrested in NYC, charged with conspiracy and securities fraud. Pled not guilty and freed on $3m bail.
04/04/13 Matthew Marshall Taylor,fmr Goldman Sachs trader arrested, charged by CFTC w/defrauding his employer on $8BN futures bet "by intentionally concealing the true huge size, as well as the risk and potential profits or losses associated."
04/04/13 Matthew Taylor admits guilt, makes plea bargain. Sentencing set for 26 June; faces up to 20 years in prison but will likely only see 3-4 years. Says, "I am truly sorry."
04/11/13 Ex-KPMG LLP partner Scott London charged by federal prosecutors w/passing inside tips to a friend in exchange for cash, jewelry, and concert tickets; expected to plead guilty in May.
08/01/13 Fabrice Tourré convicted on six counts of security fraud, including "aiding and abetting" his former employer, Goldman Sachs
08/14/13 Javier Martin-Artajo and Julien Grout charged with wire fraud, falsifying records, and conspiracy in connection with JP Morgan's "London Whale" trade.
08/19/13 Phillip A. Falcone, manager of hedge fund Harbinger Capital Partners, agrees to admit to "wrongdoing" in market manipulation. Will banned from securities industry for 5 years and pay $18MM in disgorgement and fines.
09/16/13 Javier Martin-Artajo and Julien Grout officially indicted on charges associated with "London Whale" trade.
02/06/14 Matthew Martoma convicted of insider trading while at hedge fund SAC (Stephen A. Cohen) Capital Advisors. Expected sentence 7-10 years.








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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. Now that's an activist president, in the cartoon

We have King Log in reality. Less than a figurehead, more of a stooge...


stooge
sto͞oj/
noun
noun: stooge; plural noun: stooges

1. (derogatory) a person who serves merely to support or assist others, particularly in doing unpleasant work.

"you fell for that helpless-female act and let her make you a stooge"

synonyms: underling, minion, lackey, subordinate; More
henchman;
puppet, pawn, cat's paw;
informalsidekick
"a government stooge"

2. a performer whose act involves being the butt of a comedian's jokes.
synonyms: butt, foil, straight man More
"a comedian's stooge"

verb
verb: stooge; 3rd person present: stooges; past tense: stooged; past participle: stooged; gerund or present participle: stooging

1. move around aimlessly; drift or cruise.
"she stooged around in the bathroom for a while"

2. perform a role that involves being the butt of a comedian's jokes.

[Demeter]

2. The Real Story Behind the Detroit Pension Fight and What it Means to America's Future

http://www.alternet.org/economy/real-story-behind-detroit-pension-fight-and-what-it-means-americas-future?akid=11578.227380.O3yQ0J&rd=1&src=newsletter967447&t=4

Is Detroit the canary in the coal mine for the 99 percent? When the city of Detroit filed for Chapter 9 bankruptcy in July 2013, America sucked in a collective gasp. This was the largest municipal bankruptcy filing in U.S. history by the amount of debt ($18–20 billion), and Detroit was the largest city ever to officially go bust...A few months before the bankruptcy, the state of Michigan appointed an emergency manager, Kevyn Orr, to sort things out in Motor City. Orr was given extraordinary powers to rewrite contracts and liquidate some of the city’s most valuable assets. The burning question: Who would be responsible for the enormous debt? Soon enough it became clear that the folks who would be asked to take the hit were not those who created the problems. Just as in so many other parts of the world in the wake of the 2007-'08 financial meltdown, innocent people who did nothing but get up every day and go to work would be asked to pay the bill. Last week, Orr blasted retirees for resisting his plan to drastically cut their pensions — 26 percent for general retirees and 6 percent for police and fire, and even more, 34 percent and 10 percent, respectively, if they do not agree quickly....

We Are All Detroit

...Robert Johnson, executive director of the Institute of New Economic Thinking, is an economist who has worked closely with the likes of Joseph Stiglitz and has served in Washington as chief economist of the U.S. Senate Banking Committee under William Proxmire. Johnson, who was my colleague when I served as Media Fellow at the Roosevelt Institute from 2009-2011, is an economist who believes that his work is about more than abstract mathematical models. It’s about human experience — the vivid hopes and challenges of ordinary people. When I asked Johnson how he came to think that way, a wistful smile crosses his lips: “I grew up in Detroit.” I sat down with Johnson in his New York City home, where his voice thickened with sorrow as he described the pain of looking on as the thriving city of his boyhood sank into an apocalyptic wasteland of crumbling buildings and bewildered people who mostly played by the rules but saw their lives "compressed and crushed." He recalled for me the Detroit of the 1960s, a great engine of the American economy and the cradle of many of the country’s most illustrious political figures, like Representative John Dingell (whose district started out in Detroit and gradually moved to the western suburbs through redistricting). It was also a cauldron in which the great currents of America’s deepest conflict swirled: the deadly race riots of 1967, the labor wrangling of the UAW and the Teamsters, the turmoil of the Vietnam War, and the drugs that flooded the city in the wake of deindustrialization....Johnson reflects upon the work of his friend, John A. Powell of Berkeley, a scholar of American culture who explores how we perceive some people and communities as “others.” Many things can be the basis of otherness, like race, or economic status, or gender. When we decide something is other, we absolve ourselves from having to care about it. Detroit, as Johnson explains, has become America’s urban other. As a city is liquidated for the creditors, the victims are blamed, the people become traumatized, and the trust in American institutions breaks down. Johnson’s work has shown that far from being a necessity, the decision to cut the pensions of teachers and other public workers is a choice — one that will hurt both them and future generations. As he talks about Detroit, Johnson eshews the antiseptic terms common among economists, pouring out visceral words like “pain,” “crushing” and “gut-wrenching” to describe what’s at stake for all of us.

“Detroit is the canary in the coal mine of America,” Johnson says. “It’s becoming more and more evident that you can’t count on social institutions, or your fellow citizens, or your money managers, or your healthcare system.” Detroit is not an isolated case, he cautions, but will serve as a precedent for how the country works in the future. When the weak and vulnerable are asked to pay for our sins, we will all pay in the end.

The Real Pension Story

At a recent conference on pensions convened by the Roosevelt Institute, Johnson, along with Nobel laureate Joseph Stiglitz, political scientist Thomas Ferguson, economists Lisa Cook, Dean Baker, and others gathered to explore the meaning of America’s so-called pension crisis and its alarming connection to the country’s political underbelly. To understand this story, first you have to understand the truth of what is happening with pensions across America. Media accounts, often influenced by the campaigns of well-funded organizations and individuals like billionaire anti-pension activist John Arnold, have too often promoted the false image of a widespread crisis in which overpaid public workers have been promised unaffordable and bloated pensions. That’s far from reality, Johnson’s work shows. In a new paper that will serve as an antidote to a distorted national narrative, he makes several facts clear:

1. Pension underfunding is not widespread. Despite a devastating Wall Street-driven financial crisis which decimated sales, property and state income tax receipts and which led to big cuts in federal aid, many American cities and states have managed to keep their pensions reasonably healthy. In fact, gross underfunding is concentrated in certain states, such as Illinois and Kentucky, and in cities like Chicago. These areas seem to have a few things in common, such as poor governance and unreliable public officials who have mishandled funding. Outright corruption is also common. Detroit’s government would certainly win no prizes for responsible governance, and its pension funds’ accounting practices were less than perfect, but as Johnson reports, as of 2012, the “funding ratios” (actuarial assets divided actuarial liabilities) of the city’s two big pensions funds stood at 99.9% and 87.1 respectively. That's hardly the emergency many media accounts portray.

2. State and local employees are not overcompensated. Johnson explains that the widespread perception that public workers are overpaid is highly exaggerated. Citing studies by economist Alicia Munnell and others, his paper shows that at the lower levels, overall rates of pay vary little between workers in the public and private sectors. At the higher levels, public workers actually make less than their public sector counterparts. Cases of overcompensation exist, but they are not the norm and don’t significantly contribute to underfunding problems. Overcompensation clearly did not cause the pension crisis in places like Detroit, where levels of staffing and pay per employee are well under large Midwestern cities like Cleveland and St. Louis.

3. Instead, Detroit’s finances were done in by three developments that have zero connection with city employees.

(a) First, in 1998, a Republican governor pressured the city to cut income taxes in exchange for $333.9 million annually in increased state revenue sharing for nine years. In 2002, after Detroit had cut its tax rates, the state partially reneged, over time opening a huge cumulative hole in the city’s budget.

(b)In 2010 Detroit lost $24 million more a year when its share of the state’s sales tax revenue fell as a result of the 2010 Census. In fiscal year 2012, the state administered a final blow: the state legislature chopped an additional $43 million in revenue sharing to the city. As Johnson summarizes, “Between 2010 and 2013 over 47.8% of the total decline in city revenue was a result of the decline in state transfers to the city of Detroit. When Detroit went over a cliff into bankruptcy the state could rightly be accused of providing a major shove.”

4. Underfunding is linked to unrealistic expectations of returns. One of the key reasons pension problems have developed has to do with how future returns on funds are assessed. Accounting tricks can get you the results you want, and political pressures often cause pension stewards to play around with the numbers. In technical terms, it matters whether you use something called a high discount rate or a low discount rate to determine returns. As Joseph Stiglitz has pointed out, if you decide to care about something in the future, you make plans assuming that returns will be low, and you use a low discount rate. But if you decide you don’t care about something, you use a high discount rate, which allows you to project high future returns and lets you off the hook for investing in the fund right now. Pension stewards have often based their projections on periods of unusually high stock market returns, and have therefore avoided making the payments necessary to keep funds healthy.

5. Chasing big yield leads to big problems. Where pensions are in trouble, stewards often try the economic equivalent of a Hail Mary pass: They pour large sums into alternative investments in risky assets. Investments of this sort—handled by hedge funds, venture capital, and private equity—have risen sharply since the 1980s. They now constitute 20 percent of public pension fund allocations, despite the fact that fees are high and returns are often subpar — even disastrous in 2008 and after. The huge fees tempt the firms pushing these investments to create all kinds of questionable incentives for pension stewards...Pension funds rely heavily on a vast corps of advisers, whose advice has been shown in academic studies to add no value at all. Considering, as Dean Baker and Thomas Ferguson commented, that many city and state pensioners do not receive Social Security, it is scandalous that pension managers chase high yields through high-risk assets as opposed to prudent investment in index funds, which have low fees or no fees at all.

6. Not surprisingly, another disastrous blow to Detroit’s finances came with a ridiculous derivatives deal connected with a special financing offer. As Johnson explains,

“The Detroit facts are really quite simple. The revenue losses have resulted from declines in real estate values, loss of income and loss of sales volume attributable to the crisis emanating from Wall Street after 2008. A drastic cut in state revenue sharing from the state of Michigan to Detroit in 2012 occurred on the back of previous cutbacks from the state to the city over nine years. The coup de grace was the derivatives transaction that led to diminished 'other revenues' from the Detroit Water and Sewage Department and a swaps termination penalty that led to marked increases in cash flow demands on the city of Detroit."

7. Big money politics and corruption are major culprits. As Thomas Ferguson has noted, pension underfunding and corruption go hand in hand: areas which have seen pension crises tend to have high rates of corruption, as measured by such indicators as the number of public officials who wind up in prison. Pay-to-play schemes are rampant, and reports of bribery, such as those revealed in Detroit, are common. Even in the absence of corruption, big money politics has a major influence over how pensions are managed and allocated — a major reason why campaign finance reform is urgent. As Ferguson observes, local and state politicians are relying more and more on Wall Street and other anti-pension business interests.

8. Cutting pensions is a choice, not a necessity. As Johnson and others have noted, there seems to be a discrepancy in how the sanctity of contracts is viewed in America. When it comes to the bonuses of AIG executives after the financial crisis, we were told by experts and pundits that contracts must not be broken, and that taxpayers should foot the bill to avoid breaking this fundamental trust. But in Detroit or Chicago, we are told that the contracts of pensioners are not really worth the paper they're written on. The difference? AIG executives are powerful and well-connected. Pensioners are not....There are resources to meet pension obligations, if only politicians could make decisions in the interests of ordinary people, rather than the 1 percent who do not wish to see their taxes raised. Johnson further notes that where pension shortfalls exist, they are far smaller than giveaways to corporations.

9. Decisions made now have far-reaching implications. Johnson finds that among the key themes in the pension discussion are what our choices say about the dysfunction in America politics and the kind of society we are creating for the future. High-quality workers are attracted to decent-paying jobs and promises they can rely upon. When you cut the pensions of teachers, for example, you can’t attract the highly educated workers needed to fill these jobs, and the quality of education suffers. This means that it’s not just public workers who suffer when their pensions are cut, but the children who rely on schools and the businesses that rely on a well-maintained, thriving city. It is also likely, Johnson warns, that overall compensation in the private sector will be driven down, and inequality exacerbated if public pensions are chopped. All of these factors, he points out, only serve to increase the instability of the overall economy and society. Stiglitz added an important consideration: that once any major pension system is revised shotgun-style, employees everywhere will doubt the value of their contracts and over time leave in droves. How does that bode for America's future?

Detroit is a city being looted and stripped bare. If we decide that those who are weak and vulnerable will be sacrificed to protect the wealthy and the powerful, then no one is safe. When promises are made, but then broken, a “train wreck is set up,” as Johnson puts it, and emergency manager Kevyn Orr appears to have his foot on the gas. Johnson ends his pension study with a lyric from the great jazz artist Gil Scott-Heron, who wrote a haunting song about a partial nuclear meltdown that occurred in Detroit in 1966:

“That when it comes to people’s safety

Money wins out every time.

And we almost lost Detroit this time, this time….”

If we don’t do the right thing in Detroit, Johnson warns, we might just lose America this time.

Lynn Parramore is an AlterNet senior editor. She is cofounder of Recessionwire, founding editor of New Deal 2.0, and author of "Reading the Sphinx: Ancient Egypt in Nineteenth-Century Literary Culture." She received her Ph.D. in English and cultural theory from NYU. She is the director of AlterNet's New Economic Dialogue Project. Follow her on Twitter @LynnParramore.


KEVIN ORR IS GOV. SNYDER'S HIT MAN. CURSES UPON THEM BOTH!

[Demeter]

3. Chinese firm makes plans to renovate its downtown Detroit properties

http://www.freep.com/article/20140313/BUSINESS06/303130028/DDI-China-rehabbing-Detroit-Free-Press-David-Stott-Clark-Lofts

The Chinese development firm that snagged three downtown Detroit properties at auction last year said it is moving forward with plans to renovate the 1920s-era buildings as it eyes future purchases in the city.

“We don’t hold buildings. We bought them, and we’re going to develop them,” said Ken Creighton, a local representative for the DDI Group, also known as the Shanghai-based Dongdu International Group, which is making its first foray in the U.S.

DDI paid $16.4 million for the three buildings it won in online auctions last fall:

DETAILS AT LINK

Creighton said his firm is actively looking at buying additional properties in the city, although he can’t yet offer specifics.

“We are still in acquisition mode,” he said. “We intend to invest even more money into Detroit.”

[tclambert]

4. So where is the media and popular outrage that Detroit's bankruptcy was Made To Happen On Purpose?

This is not tin-foil hat conspiracy theory stuff. Republicans in the State government reneged on deals and cut state revenue-sharing with Detroit. Then they cried, "Emergency! Emergency! Detroit is in financial trouble. We must re-do all union contracts and pension deals." This is from the same governor who raised taxes on seniors in order to cut taxes on businesses.

[Demeter]

5. Welcome to my world-Teahadia

[Demeter]

6. LIFE IMITATES "WEEKEND" 'Waiting For Godot' Strikes A Chord In Tehran

http://www.npr.org/blogs/parallels/2014/03/14/289831124/waiting-for-godot-strikes-a-chord-in-tehran?ft=1&f=1001

[Demeter]

7. Richard D. Wolff | Obama's Economic Significance

http://truth-out.org/news/item/22277-obamas-economic-significance

...On one hand, Obama continued the economic program imposed on all presidents since World War II. On the other, Obama had the hardest time doing so and is likely the last to do it in the manner of those other presidents. History provides our context for assessing Obama's economic significance.

The US economy's defining moment across the past century was the 1930s eruption of an organized, self-conscious working class into politics. Massive union organizing drives by the Congress of Industrial Organizations (CIO) allied with massive popular mobilizations by socialist and communist parties. That labor-radical coalition forced huge concessions - the New Deal - from business and the wealthy. They were taxed and regulated to enable major gains for middle- and lower-income citizens. Those gains included establishing Social Security, unemployment compensation, minimum wage, and millions of federal jobs.

Labor-radical explosion from below reversed income and wealth inequalities deepened by capitalism's development after the Civil War to the 1929 crash. Haunting the historic changes across the 1930s were plausible intimations (by socialists) and occasional threats (by communists) of revolution. Labor-radical pressures generated President Franklin D. Roosevelt's famous 1944 proposals for a 100 percent top income tax rate and for a Second Bill of Rights.

When war ended and FDR died, reactionaries mobilized to roll back the New Deal and all it represented. Business, the rich and other right-wing social forces organized a conservative coalition to cut regulations, cut taxes or shift them to others, and reduce government services (other than military). Economic history since 1945 charts the reversal of the New Deal domestically alongside developing a global pax Americana.

The domestic campaign largely succeeded despite occasional missteps. Government policies conformed because of (1) financial levers worked by business and the rich, and (2) voting blocs managed by conservative religious and other organizations. The money interest focused chiefly on undoing the New Deal. Social conservatives pushed state favoritism for their institutions and beliefs...

[Demeter]

8. Tax fight looms large in Energy Future restructuring

THIS ARTICLE ABOUT AN "ENERGY COMPANY" ILLUSTRATES EVERY THING WRONG WITH AMERICAN BUSINESS THESE DAYS. IT'S WORSE THAN ENRON, AND IT HAS GOLDMAN SACHS AND KKR ALL OVER IT...

http://www.reuters.com/article/2014/03/12/us-energyfuture-irs-analysis-idUSBREA2B02U20140312

[DemReadingDU]

9. Happy Pi day!

[Demeter]

10. I ALMOST FORGOT!

Thank you! Now I know what's for dinner!

PS that looks like a CHEESECAKE to me!

[DemReadingDU]

11. Pi is round, lol

Celebrate Pi day!
http://www.piday.org/

[xchrom]

12. FTSE touches 5-week low on Ukraine jitters

http://uk.reuters.com/article/2014/03/14/uk-markets-britain-stocks-idUKBRE8710BE20140314

(Reuters) - Britain's top share index hit a five-week low on Friday and headed for its biggest weekly drop in eight months, with growth-driven stocks losing ground on tensions before a referendum in Ukraine's Crimea region.

The blue-chip FTSE 100 index was down 0.3 percent at 6,537.36 points by 1130 GMT, taking the week's total losses to 2.6 percent, the biggest decline since June last year. The index has fallen 5 percent since a high in late February.

The fund management, retail and mining sectors, all highly sensitive to economic conditions, came under pressure as investors looked to cut exposure to riskier assets heading into the weekend, when Ukrainians in Crimea vote on whether to join Russia. Moscow said it would veto a U.S.-drafted UN resolution to declare the referendum illegal.

"The market is spooked due to the prospect of more sanctions against Russia as an awful lot of money comes to the market from some very rich Russian investors. The FTSE was touching new highs anyway and Sunday's referendum has become a perfect excuse to take some money off the table," David Battersby, investment manager at Redmayne-Bentley, said.

[xchrom]

13. Euro zone employment rises first time in three years in Q4

http://uk.reuters.com/article/2014/03/14/uk-eurozone-economy-employment-idUKBREA2D0KP20140314

(Reuters) - Euro zone employment rose for the first time in nearly three years in the last quarter of 2013 adding to signs of the bloc's gradual economic recovery, with clear improvement also in the most troubled southern region.

Employment in the euro zone inched up 0.1 percent quarter-quarter in the last three months of 2013 after staying flat in the previous two quarters.

It was still 0.5 percent lower year-on-year, but the pace of contraction slowed further from -0.8 percent in the third quarter of 2013 and -1.1 in the second.

It was the first rise in employment in the euro zone since the second quarter of 2011, the EU's statistics office Eurostat said on Friday.

[Demeter]

14. Fear of Wages PAUL KRUGMAN

http://www.nytimes.com/2014/03/14/opinion/krugman-fear-of-wages.html

...Suddenly, it seems as if all the serious people are telling each other that despite high unemployment there’s hardly any “slack” in labor markets — as evidenced by a supposed surge in wages — and that the Federal Reserve needs to start raising interest rates very soon to head off the danger of inflation...O.K., where is this coming from? The starting point for this turn in elite opinion is the assertion that wages, after stagnating for years, have started to rise rapidly. And it’s true that one popular measure of wages has indeed picked up, with an especially large bump last month. But that bump is probably a snow-related statistical illusion. As economists at Goldman Sachs have pointed out, average wages normally jump in bad weather — not because anyone’s wages actually rise, but because the workers idled by snow and storms tend to be less well-paid than those who aren’t affected. Beyond that, we have multiple measures of wages, and only one of them is showing a notable uptick. It’s far from clear that the alleged wage acceleration is even happening. And what’s wrong with rising wages, anyway? In the past, wage increases of around 4 percent a year — more than twice the current rate — have been consistent with low inflation. And there’s a very good case for raising the Fed’s inflation target, which would mean seeking faster wage growth, say 5 percent or 6 percent per year. Why? Because even the International Monetary Fund now warns against the dangers of “lowflation”: too low an inflation rate puts the economy at risk of Japanification, of getting caught in a trap of economic stagnation and intractable debt.



Part of the answer, I’d submit, is that for some people it’s always 1979. That is, they’re eternally vigilant against the danger of a runaway wage-price spiral, and somehow they haven’t noticed that nothing like that has happened for decades. Maybe it’s a generational thing. Maybe it’s because a 1970s-style crisis fits their ideological preconceptions, but the phantom menace of stagflation still has an outsized influence on economic debate.

Then there’s sado-monetarism: the sense, all too common among in banking circles, that inflicting pain is ipso facto good. There are some people and institutions — for example, the Basel-based Bank for International Settlements — that always want to see interest rates go up. Their rationale is ever-changing — it’s commodity prices; no, it’s financial stability; no, it’s wages — but the recommended policy is always the same.

Finally, although the current monetary debate isn’t as openly political as the previous fiscal debate, it’s hard to escape the suspicion that class interests are playing a role. A fair number of commentators seem oddly upset by the notion of workers getting raises, especially while returns to bondholders remain low. It’s almost as if they identify with the investor class, and feel uncomfortable with anything that brings us close to full employment, and thereby gives workers more bargaining power...

[Demeter]

15. Japan to name, shame firms that refuse to hike pay

http://www.japantimes.co.jp/news/2014/03/13/business/japan-to-name-shame-firms-that-refuse-to-hike-pay/#.UyKMACtkJe4

The government threatened Thursday to take the unprecedented step of shaming big companies that do not raise wages during the annual spring labor talks, despite calls by the nation’s inflation-stoking prime minister to boost pay.

The surprising threat to disclose companies’ names comes days after Akira Amari, state minister in charge of economic and fiscal policy, raised the stakes in the sensitive pay negotiations with an apparent threat to take action against “uncooperative” firms.

The usually low-key talks were being closely watched to see if cash-rich firms would put more money in workers’ pockets amid worries that wages aren’t keeping pace with the Bank of Japan’s bid to stoke 2 percent inflation, and that the sales tax hike on April 1 will put the brakes on growth.

The government “will react in some way” against firms that are “uncooperative with our policy of creating a virtuous economic cycle,” Amari told reporters on Tuesday, referring to the “Abenomics” strategy of Prime Minister Shinzo Abe...

[kickysnana]

16. Link: *** Aaaand we're back! Return of the DUzy Awards -- Squirrel is not a groundhog edition! ***

http://www.democraticunderground.com/10024661490

[westerebus]

23. Thank you.

[Demeter]

17. BP regains ability to bid on leases for U.S. land, water

http://www.washingtonpost.com/business/economy/bp-regains-ability-to-bid-on-leases-for-us-land-water/2014/03/13/4f89a616-aaee-11e3-af5f-4c56b834c4bf_story.html

IT SHOULD HAVE BEEN A LIFETIME BAN...FOR THE CORPORATION.

The Environmental Protection Agency and BP have reached an agreement that lifts a ban on BP’s ability to hold government contracts that has barred the company from bidding on oil and gas leases on federal lands and waters because of the massive oil spill triggered by a blowout on a BP well in April 2010.

BP, the largest lease-holder and one of the largest oil producers in the Gulf of Mexico, had been pressing for an end to its debarment in order to conduct business more freely and to reassure shareholders that the company could move beyond the accident at its Macondo well. The accident killed 11 workers, sank the half-billion-dollar Deepwater Horizon drilling rig, and spilled as much as 4.2 million barrels into the gulf.

“This was an important milestone,” said Pavel Molchanov, energy analyst at the investment firm Raymond James. “There was some symbolism to this. But it goes beyond symbolism to substantive things, like getting new acreage in the Gulf of Mexico. That is valuable to the company.”

The London-based oil giant filed a lawsuit in a Texas federal court last August, asserting that it had been punished enough and that it was doing its best to make amends for the April 2010 spill...

PUNISHED ENOUGH? MADE AMENDS? NOT BY ANY STRETCH OF THE IMAGINATION!

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18. Draghi holds course in face of deflation threat

http://uk.reuters.com/article/2014/03/14/uk-ecb-deflation-insight-idUKBREA2D0S320140314

(Reuters) - Meeting students at the University of Amsterdam in April last year, European Central Bank President Mario Draghi extolled the virtues of courage, recalling a story his father had told him:

"In between the wars, he saw an inscription on a German monument, a German statue saying that 'if you lose your money you've lost nothing, because with a good business you will take it back; if you lose honour, you've lost a lot, but with good heroic action you can get it back; but if you've lost courage, you've lost everything.'"

Draghi showed his steeliness at the height of the euro zone crisis, vowing to do "whatever it takes" to save the currency.

Now investors would like him to show the same mettle again and take bold policy action to buoy the euro zone economy and steer it away from the economic quicksand of deflation. With no 'shock and awe' policy move in sight, they may be disappointed.

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19. India's wholesale inflation eases to nine-month low

http://uk.reuters.com/article/2014/03/14/uk-india-economy-wpi-idUKBREA2D0C120140314

(Reuters) - India's wholesale price-based inflation eased to a nine-month low in February as food and fuel prices moderated, raising expectations that the central bank would leave interest rates unchanged at its policy review next month.

The wholesale price index (WPI), long regarded as India's main inflation measure, rose a slower-than-expected 4.68 percent last month from a year earlier.

A 10 percent drop in wholesale vegetable prices from January helped overall inflation ease for the third straight month.

Friday's data comes on the heels of a faster-than-expected slowdown in consumer inflation, which eased for a third straight month to a 25-month low of 8.10 percent in February.

[xchrom]

20. How Economic Populism Is Transforming the Most Unequal Region of the Globe

http://www.thenation.com/blog/178836/how-economic-populism-transforming-most-unequal-region-globe

"Chile has but one great enemy, and its name is inequality. Only together can we take it on.”

With those words, Michelle Bachelet returned to the presidency of Chile this week. The Socialist leader has vowed to put inequality at the top of her agenda. In doing so, she is hardly alone among Latin American leaders.

Latin America has long been one of the most unequal areas of the globe. But during the past decade, the region has witnessed a remarkable turnaround. Economic populism has swept the continent, leading to the election of left-of-center political parties that have implemented anti-equality agendas. Their efforts have borne fruit. During a decade when economic inequality grew by leaps and bounds in the rest of the world, it declined significantly in Latin America.

Last year, the World Bank reported that the region’s Gini coefficient, a statistic that measures inequality, decreased from 58 in 1996 to 52 in 2011. During the 2000s, Gini coefficients declined in thirteen of seventeen individual Latin American countries as well. In that same decade, rate of extreme poverty (people surviving on less than $2.50 a day) was cut by 25 percent to 13 percent. Those at the bottom 40 percent of the income scale also made impressive gains—their average income rose by 5 percent, as opposed to 3 percent on average for the population as a whole.

[Demeter]

21. GE files to spin off credit card unit By Aman Shah

http://www.reuters.com/article/2014/03/13/us-general-electric-ipo-idUSBREA2C0RZ20140313

General Electric Co's credit card unit filed for an initial public offering on Thursday, the first step in the conglomerate's long-awaited plan to exit retail finance and reduce its dependence on its financing arm.

GE announced plans in November to spin off the North American retail finance business into a publicly traded company, which bankers estimated could be worth roughly $16 billion to $18 billion.

GE will look to raise as much as $3.5 billion from the IPO and seek a valuation of $20 billion to $25 billion for the unit, Bloomberg reported, citing people with knowledge of the matter...GE has been reducing its reliance on GE Capital, its financing arm, which at one point accounted for almost half of the company's profit. The unit's rising funding costs during the 2008 financial crisis nearly sank the entire company.

With the spinout of the retail lending business, GE hopes to focus on its industrial divisions and better compete with rivals such as Honeywell International Inc and United Technologies Corp, which have smaller financing arms.


AFTER COSTING THE US TAXPAYERS how much?

Worst Bailout In U.S. History: General Electric Gets $182.5 Billion In Obama Buddy Bailout: Project Calls For Jeffery Immelt’s Immediate Resignation.

http://politicalvelcraft.org/2011/01/21/worst-bailout-in-u-s-history-general-electric-gets-182-5-billion-in-obama-buddy-bailout-project-calls-for-jeffery-immelts-immediate-resignation/

FROM WAPO 2009:

... GE Capital is one of the world's largest and most diverse financial operations, lending money for commercial real estate, aircraft leasing and credit cards for stores such as Wal-Mart. If GE Capital were classified as a banking company, it would be the nation's seventh largest. ...http://www.washingtonpost.com/wp-dyn/content/article/2009/06/28/AR2009062802955_2.html?sid=ST2009062803183

FROM FOX BUSINESS 2009:

...If GE spins off GE Capital (which it vows it won't), without the benefit of a deep-pocketed industrial parent and the extraordinary generosity of the US taxpayer, there are deep GEconcerns that GE Capital might go under, analysts on Wall Street fear....

WELL, TIMES HAVE CHANGED...THEY GOT THE TAXPAYER'S GENEROSITY.

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22. UBS traders tried to rig key Hong Kong interest rate

http://www.bbc.com/news/business-26574108

Traders at Swiss bank UBS made around 100 attempts to rig a key lending rate called Hibor, the region's financial regulator has said.

The Hong Kong Monetary Authority (HKMA) found internal chat messages which contained "change requests" between 2006 and 2009.

The requests were made "with a view to rigging the Hibor fixing" HKMA said.

But the regulator said it found no evidence of collusion with other banks in the region to rig the rate.

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24. February US retail sales thaw out after winter chill

http://www.bbc.com/news/business-26560856


US retail sales rose for the first time in two months in February, official figures have shown.

The figures suggest the world's largest economy is gaining in strength after suffering the third-coldest winter on record.

Retailers reported that sales rose 0.3% in the month, the US Commerce Department said, after falling by a revised 0.6% in January.

The figure beat economists' forecasts for a more modest rise of 0.2%.

[xchrom]

25. CALLING MISTRESS TANSY!11 Mineral hints at bright blue rocks deep in the Earth

http://www.bbc.com/news/science-environment-26553115


Blue planet: Ringwoodite minerals reveal hints of what things might look like deep within the Earth


Minerals preserved in diamond have revealed hints of the bright blue rocks that exist deep within the Earth.

They also provide the first direct evidence that there may be as much water trapped in those rocks as there is in all the oceans.

The diamond, from central-west Brazil, contains minerals that formed as deep as 600km down and that have significant amounts of water trapped within them.

Researchers have published their findings in the journal Nature.

[Demeter]

26. U.S. swaps watchdog says considering bitcoin regulation

http://www.reuters.com/article/2014/03/11/bitcoin-regulation-idUSL2N0M824O20140311

The U.S. derivatives regulator is studying whether it should regulate electronic currencies such as bitcoin, its chief said on Tuesday, as regulators across the globe start taking the emerging technology more seriously.

"We are looking into that," Mark Wetjen, acting chairman of the Commodity Futures Trading Commission, told journalists after giving a speech at an industry conference. "It's been initiated, there's been an internal discussion at the staff level."

Bitcoin, the best-known virtual currency, has been promoted by many enthusiasts because of the way it operates outside government control. But recent incidents, such as the failure of Mt. Gox, a Tokyo-based exchange that filed for bankruptcy after losing an estimated $650 million worth of customer bitcoins, have brought the currency under a new level of scrutiny by regulators. Unlike conventional money, bitcoin is generated by computers and is independent of control, or any backing, by a government or a central bank - something that makes it vulnerable to mishaps. Wetjen said the CFTC, which regulates swaps and futures, has broad authority to counter manipulation of commodity markets, and it is studying whether bitcoin falls under those rules.

"I think people (in the agency) believe there's a pretty good argument that it would fit that definition," Wetjen said.

He added, "Then there's a separate question about whether or not there is some derivative contract based on, or denominated in a virtual currency and whether that's listed on an exchange. ... There's some looking into that question too."

Wetjen said he could not say what would come out of the internal deliberations or give a timeframe.

Separately on Tuesday, New York state's top financial services regulator, Benjamin Lawsky, said he wanted prospective virtual currency exchange operators to submit formal applications, a first step toward eventual regulation.

And the brokerage industry's own watchdog, FINRA, warned that bitcoin can expose people to significant losses, fraud and theft, and the lure of a potential quick profit should not blind investors to the virtual currency's significant risks.