Weekend Economists' Atonement: October 2-4, 2009

[Demeter]

The autumnal equinox brings so many long-standing rituals: Harvest, of course; Diwali, the festival of Lights, for the Hindi; Hallowe'en for us superstitious, Druids or Pottermaniacs; and the High Holidays, New Year and Sukkot for the Jews.

If there is a theme to it all, it would be the ending of the bright, warm, lazy days of summer and preparations for a less than easy winter. Food must be stored to last, for the growing season is over, clothing must be prepared for inclement weather, houses made tight against storms. And the mind must be prepared for the hardships that follow Summertime, when the living was (relatively) easy. Living in close quarters for several months also means that squabbles must be settled, hurt feelings must be acknowledged, and injuries must be healed; otherwise, it's going to be a long and hairy winter.

This is the Winter of Our Discontent. The economy is in the toilet, and predatory Capitalism is about to pull the stopper. The government of the People, By the People, and for the People has never applied to so limited a number of People for maybe a century, and we may not know who those people are, but we are sure not to be among their number.

So, what to do? Seek knowledge and apply it, keep your home fires burning and your family safe, and cultivate useful and trusty friends. Survive, for there will be a Spring, and it's worth hanging around for. Until then, heed the ram's horn call:

http://www.youtube.com/watch?v=Uit9Z2-7mhg&feature=related

Welcome the New Year, and atone for any errors or injuries you inflicted on others during the past year!

http://en.wikipedia.org/wiki/Shofar

[Demeter]

1. And as part of our atonement: Another Bank Fails

This one is rather close to home: Warren, Michigan, in fact.


Warren Bank, Warren, Michigan, was closed today by the Michigan Office of Financial and Insurance Regulation, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with The Huntington National Bank, Columbus, Ohio, to assume all of the deposits of Warren Bank.

The six branches of Warren Bank will reopen on Saturday as branches of The Huntington National Bank...As of July 31, 2009, Warren Bank had total assets of $538 million and total deposits of approximately $501 million. The Huntington National Bank will pay the FDIC a premium of 0.27 percent to assume all of the deposits of Warren Bank. In addition to assuming all of the deposits of the failed bank, The Huntington National Bank will purchase approximately $83 million of the failed bank's assets. The FDIC will retain the remaining assets for later disposition...

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $275 million. The Huntington National Bank's acquisition of all the deposits was the "least costly" resolution for the FDIC's DIF compared to alternatives. Warren Bank is the 96th FDIC-insured institution to fail in the nation this year, and the second in Michigan. The last FDIC-insured institution closed in the state was Michigan Heritage Bank, Farmington Hills, on April 24, 2009.

AS MORE REPORTS COME IN, THIS PARTICULAR SUB-THREAD WILL BE UPDATED...I'M SURE THERE'S MORE FAILURES THAN THIS.

[burf]

10. Another failure in Minnesota

On Friday, October 2, 2009, Jennings State Bank, Spring Grove, MN was closed by the Minnesota Department of Commerce, and the Federal Deposit Insurance Corporation (FDIC) was named Receiver. No advance notice is given to the public when a financial institution is closed.

http://www.fdic.gov/bank/individual/failed/jennings-mn.html

I think this is one that got a cease and desist order not too long ago.

Happy weekend to all!

[Demeter]

11. Thank you, Burf!

more detail:

As of July 31, 2009, Jennings State Bank had total assets of $56.3 million and total deposits of approximately $52.4 million. Central Bank did not pay the FDIC a premium for the deposits of Jennings State Bank. In addition to assuming all of the deposits of the failed bank, Central Bank agreed to purchase essentially all of the assets.

The FDIC and Central Bank entered into a loss-share transaction on approximately $37.7 million of Jennings State Bank's assets. Central Bank will share in the losses on the asset pools covered under the loss-share agreement. The loss-share arrangement is projected to maximize returns on the assets covered by keeping them in the private sector. The agreement also is expected to minimize disruptions for loan customers...The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $11.7 million. POCKET CHANGE, REALLY Central Bank's acquisition of all the deposits was the "least costly" resolution for the FDIC's DIF compared to alternatives. Jennings State Bank is the 97th FDIC-insured institution to fail in the nation this year, and the fourth in Minnesota. The last FDIC-insured institution closed in the state was Brickwell Community Bank, Woodbury, on September 11, 2009.

[Demeter]

31. A Third Bank Falls in Colorado

Southern Colorado National Bank, Pueblo, Colorado, was closed today by the Office of the Comptroller of the Currency, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Legacy Bank, Wiley, Colorado, to assume all of the deposits of Southern Colorado National Bank...

As of September 4, 2009, Southern Colorado National Bank had total assets of $39.5 million and total deposits of approximately $31.9 million. Legacy Bank will pay the FDIC a premium of one percent to assume all of the deposits of Southern Colorado National Bank. In addition to assuming all of the deposits of the Southern Colorado National Bank, Legacy Bank agreed to purchase essentially all of the assets.

The FDIC and Legacy Bank entered into a loss-share transaction on approximately $25.5 million of Southern Colorado National Bank's assets. Legacy Bank will share in the losses on the asset pools covered under the loss-share agreement...The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $6.6 million. Legacy Bank's acquisition of all the deposits was the "least costly" resolution for the FDIC's DIF compared to alternatives. Southern Colorado National Bank is the 98th FDIC-insured institution to fail in the nation this year, and the third in Colorado. The last FDIC-insured institution closed in the state was New Frontier Bank, Greeley, on April 10, 2009.

[Demeter]

70. Questions Arise As FDIC Fails To Disclose Key Details On Bidders For Failed Banks

http://www.huffingtonpost.com/2009/09/04/fdic-fails-to-disclose-ke_n_276761.html

The federal agency charged with resolving failed banks and selling their assets is hiding key details about the transactions.

The identities of losing bidders and the prices they've offered for failed bank assets are some of the details currently not being fully disclosed. For decades, this information was publicly available. But this year the Federal Deposit Insurance Corporation abruptly decided to limit the flow of information.

It couldn't have come at a worse time. In addition to the bailout of financial companies like Citigroup, AIG and Bank of America, the federal government is on the hook for another $80 billion through a little-reported FDIC program designed to encourage private investors to buy failed banks and their assets.

When banks fail, the FDIC effectively takes them over, with an eye towards returning them to the private sector as soon as possible. In the past, the FDIC typically solicited bids from other banks. Now, private equity groups have been added to the list of eligible investors. Regardless of what type of investor is ultimately chosen to take over a failed bank, the FDIC is required by law to choose the "least costly" bid.

As first reported by American Banker, it's documents from those very deals that the FDIC has largely not released, despite numerous official requests via the Freedom of Information Act, the law that ensures public access to U.S. government records. While the winning bids are disclosed, most of the losing bids are not.

"We don't know whether the government got us the best deal," said Kenneth Thomas, an independent bank consultant and finance lecturer at the University of Pennsylvania. "We're not talking millions -- we're talking billions of dollars."

For example, one of the bids for BankUnited, a failed Florida-based lender that had about $13 billion in assets at the time it was sold, failed to secure victory despite the fact the potential buyer offered the most money for the bank's assets.

Not disclosing the documents appears to run counter to a pledge made by President Barack Obama on his first full day in office.


Read more at: http://www.huffingtonpost.com/2009/09/04/fdic-fails-to-disclose-ke_n_276761.html

[Demeter]

77. Disclosure Rests With Solicitor General Kagan, A Transparency Proponent

Decision On Disclosure Of Fed Loan Recipients Rests With Solicitor General Kagan, A Transparency Proponent

http://www.huffingtonpost.com/2009/09/17/decision-on-disclosure-of_n_290112.html

For over a year, the Federal Reserve has refused to publicly identify the companies that received over two trillion dollars through its emergency lending programs, claiming that disclosure of such records would put the recipients at a competitive disadvantage.

Now, the ultimate decision on the Fed's appeal of a judicial order to release those records rests with the government's top lawyer, Solicitor General Elena Kagan, who has been a strong proponent of the need for transparency in government.

The Fed has fought against public disclosure, arguing "it will cause irreparable harm to the institutions whose information is disclosed and to the Board's ability to effectively manage the current, and any future, financial crisis." The central bank also has refused to disclose the amounts or the assets put up as collateral under 11 emergency lending programs.

Bloomberg News, which filed the request for documents under the Freedom of Information Act (FOIA), argues that the information is "central to understanding and assessing the government's response to the most cataclysmic financial crisis in America since the Great Depression. The information we seek will shine the disinfectant of sunlight on one of the core causes of our current financial crisis."

Essentially, the public doesn't know who got taxpayer money through the lending programs, what the recipients paid for it or whether the taxpayers are getting a good deal.

Since last November, the fight between Bloomberg News and the Fed has been fought in a New York courtroom. Last month, Manhattan Chief U.S. District Judge Loretta Preska ruled against the Fed, giving it five days to turn over the documents but the central bank quickly appealed the decision.

Now the decision is in the hands of Kagan, an Obama appointee, who has until Sept. 25 to authorize the Fed's appeal.

On his first full day in office, Obama pledged transparency in his administration -- and singled out FOIA.


"The Freedom of Information Act is perhaps the most powerful instrument we have for making our government honest and transparent, and of holding it accountable," he said Jan. 21. "And I expect members of my administration not simply to live up to the letter but also the spirit of this law."

Kagan, who left her post as dean of Harvard Law School to join the administration, has written about the need for transparency. In a 2001 law review article about presidential administration and bureaucracy, she noted:

"Bureaucracy is the ultimate black box of government ... is impervious to full public understanding, much less control. But for this very reason, the need for transparency, as an aid to holding governmental decisionmakers to account, here reaches its apex."

A raft of news organizations, including Dow Jones, the New York Times, the Associated Press and Gannett Newspapers plan to side with Bloomberg by filing a friend of the court brief, Bloomberg notes.

A spokeswoman for the Department of Justice said Kagan's office is reviewing the case. No decision has been made.

In an editorial, Bloomberg News Editor-in-Chief Matthew Winkler wrote:

"This is an opportunity for President Obama to make good on his promise to create the most transparent government. By forgoing an appeal, he can show that he means what he says.

What he says is correct. Transparency promotes accountability. So far, there has been much too little of it when it comes to the use of our money to save the banks that failed their shareholders and creditors."

[Demeter]

78. The $2 Trillion Secret

http://www.huffingtonpost.com/pat-choate/the-2-trillion-secret_b_291784.html

President Barack Obama went to the center of New York's financial district (in September) to describe how his Administration intended to overhaul U.S. financial regulations. The hallmarks of these reforms, he said, would be transparency and accountability.

Fortunately, the President need not wait on Congressional enactment of legislation to get the transparency he seeks. He already has the authority to release all the details of the TARP bailout and identify the beneficiaries, how much money they got, what terms the Treasury Department imposed, what collateral was posted and what the recipients did with the taxpayers' funds. If the Treasury lacks that data, the General Accountability Office has the authority and resources needed to collect, organize, and analyze it.

A more difficult challenge will be to persuade the Federal Reserve System to release similar information on the $2 trillion of emergency loans it made as part of its economic recovery program.

Several news organizations, including Fox and Bloomberg, have sought that information under the provisions of Freedom of Information laws since 2007. Throughout the spring, summer and fall of 2008, Federal Reserve officials stalled the requests, finally claiming that release of the information might embarrass recipient stockholders, might trigger a run by bank depositors and might make their economic recovery efforts more difficult.

Bloomberg News filed a federal lawsuit in November 2008 in the U.S. District Court, Southern District of New York (Manhattan) challenging that stonewalling and won the case. Chief U.S. District Judge Loretta Preska on August 24 ruled that the Fed had "improperly withheld agency records" giving it a week to disclose daily reports on its loans to banks and other financial institutions.

Three days later, Federal Reserve lawyers asked the courts for a delay so that they could make an expedited appeal of her decision. Several major banks, operating through an organization named "The Clearing House," filed a supporting brief with the appeals court, claiming that the Federal Reserve had provided its members emergency funds under an agreement not to identify the recipients or the loan terms.

The Clearing House brief described its members as, "he most important participants in the international banking and payments systems and among the world's largest intermediaries in interbank funds transfers." They include ABN Amro Bank, N.V. (Dutch), Bank of America, The Bank of New York Mellon, Citibank, Deutsche Bank Trust (Germany), JP Morgan Chase Bank, UBS (Switzerland), and Wells Fargo.

As the sheer volume of the Fed financing makes clear, the bailout of the financial sector involves more than the $700 billion approved by Congress in late 2008. The Federal Reserve's $2 trillion of secret deals is by far the largest portion.

Why are the Fed and the banks fighting so hard to keep the loan details secret? Congress and taxpayers cannot know until they have the information the Federal Reserve is keeping from them, but several plausible explanations exist.

One is that the Fed has taken a great deal of worthless collateral and is propping up failed companies and banks. A second is that the information will make the issue of paying out huge Wall Street bonuses in 2009 politically radioactive, particularly if it turns out the payments are dependent on these federal loans.

Finally, the Federal Reserve probably does not want that information to be part of the forthcoming Senate hearings on the re-confirmation of Ben Bernanke, current Chairman of the Federal Reserve.

If President Obama seriously wants transparency and accountability, the place to start is Ben Bernanke's confirmation hearing.

The President and the U.S. Senate should put Bernanke's nomination on hold until the Federal Reserve makes public the detailed information about these unprecedented $2 trillion of secret loans.


Read more at: http://www.huffingtonpost.com/pat-choate/the-2-trillion-secret_b_291784.html?view=print

[ozymandius]

2. First! Ha!

A first for my first.

I wonder if Georgia will have any more failures tonight.

[Dr.Phool]

5. Seconded!

[UpInArms]

24. late to the party - as usual - for me

:thumbsup:

:hi:

[Demeter]

25. But Always Welcome!

[AnneD]

38. Good to see so many marketeers here....

lot's of stuff going on this weekend but "I'll be back".

[Hugin]

40. Hey peeps!

Good to see Y'all!

:7

[Demeter]

3. U.S. Job Losses May Be Even Larger, Model Breaks Down (Update1)

THE ECONOMIST'S EQUIVALENT TO "THE DOG ATE MY HOMEWORK". REPENT, YE SINNERS, AND SIN NO MORE!


http://www.bloomberg.com/apps/news?pid=20601068&sid=aGBkhROUjNds

Oct. 2 (Bloomberg) -- The U.S. economic slump earlier this year was so severe it short-circuited the government’s model for calculating payrolls, raising the risk that today’s jobs report may be too optimistic.

About 824,000 more jobs may be subtracted from the payroll count for the 12 months through last March when the figures are officially revised early next year, a Labor Department report showed today. The revision would be the biggest since at least 1991.

The bulk of the miss occurred in the calculations for the first quarter of this year, the Labor Department said. The economy shrank at a 6.4 percent annual pace in the first three months of 2009, the worst performance since 1982.

The figures raise the possibility that the government’s calculations continue to miss the mark.

“We are probably still underestimating job losses,” said John Silvia, chief economist at Wells Fargo Securities LLC in Charlotte, North Carolina. “There could be another 30,000 to 40,000” that the data isn’t picking up, he said.

That would mean the loss of jobs for September could turn out to be as high as 300,000, rather than the 263,000 reported today by the Labor Department. Today’s report also showed the jobless rate climbed to 9.8 percent last month, a 26-year high.

The potential revision for the year through last March would mean that the economy lost 5.6 million jobs for the period instead of the 4.8 million now on the books.

Companies Surveyed

The payroll estimates are based on a government survey of about 160,000 businesses and government agencies covering around 400,000 worksites.

Once a year, the Labor Department revises its payroll figures after combing through tax records from the unemployment insurance program that covers practically all businesses. Those records are only available after a lag, explaining why it takes more than a year to make the tabulations.

The department uses a formula, known as the birth/death model, to determine the influence on payrolls from the formation and demise of businesses.

Because the government doesn’t know if a company fails to respond because it has gone out of business or is just late, it estimates the number of companies that may have folded. By the same token, it plugs in an estimate for the formation of new businesses to account for their hiring.

From April 2008 through December, the tax records showed the Labor Department’s figures overestimated payrolls by about 150,000, said Chris Manning, the national benchmark branch chief at the Bureau of Labor Statistics. That implies the estimates missed the mark by about 675,000 in the first quarter of this year, which currently shows a 2.1 million drop in payrolls.

Not Working ‘Well’

“In this period of steep job losses, the birth/death model didn’t work as well as it usually does,” Manning said in an interview. “To the extent that there was an overstatement in the birth/death model, that is likely to still be there.”

The model added about 184,000 jobs to the payroll total last quarter compared with a 135,000 increase in the same period in 2008, before the financial crisis deepened with the collapse of Lehman Brothers Inc.

“This birth/death model is still assuming that we are getting new jobs from new-business creations,” David Rosenberg, chief economist at Gluskin Sheff & Associates Inc. in Toronto, said in an interview.

‘Alice in Wonderland’

“These additions are coming somewhere from ‘Alice in Wonderland,’” he said, referring to the novel by Lewis Carroll detailing the adventures of a girl that fell down a rabbit hole into a fantasy world.

“Even though the current data is bad, the numbers are actually even worse,” Rosenberg said.

Wells Fargo’s Silvia says the birth/death calculation isn’t the only thing that’s broken as many companies are also discarding their business models.

Companies “really have diminished their willingness to hire labor for any production level,” Silvia said. “It’s really a strategic change,” where companies will be keeping fewer employees for any particular level of sales, in good times and bad, he said.


WELL, AT LEAST THEY ARE ADMITTING IT. THAT'S A GOOD START.

[ozymandius]

6. Like I said in that "other" econ thread -

The numbers were so bad, they broke the meter. Good evening, Demeter, and all. :hi:

[Dr.Phool]

7. Denninger's take on the numbers.

September Unemployment: ACTUAL LOSS 995k

YOUCH.

Headlines: 263,000 "jobs lost" and unemployment rate up to 9.8%.

(charts)

That's not good - there goes the "second derivative" argument.

Weekly earnings are also down by $1.54, which is bad news too.

But the Household Data is VASTLY worse than reported. Here are the month-over-month changes, and they're in the realm of frightening. (all numbers in thousands)

Civilian Labor Force: 154,879 to 153,617 this month.

Employed: 140,074 down to 139,079 this month.

That's a loss of 995,000 jobs, not 263,000, and the labor force contracted by 1,262,000 people!

The participation rate was absolutely decimated, down 0.6% this last month alone. The people "not in the labor force" rose by a staggering 1,516,000 in the last month.

The government doesn't count people as "unemployed" who have given up and exited the labor force, but as I have repeatedly noted whether the government counts them or not the corner store owner sure as hell does!

The fact of the matter is that nearly 1 million fewer people were working in September as compared to August; there has been absolutely no improvement in that trend whatsoever.
Facebook September Unemployment: ACTUAL LOSS 995k Digg September Unemployment: ACTUAL LOSS 995k Bloglines September Unemployment: ACTUAL LOSS 995k Bookmark September Unemployment: ACTUAL LOSS 995k at YahooMyWeb Bookmark September Unemployment: ACTUAL LOSS 995k at reddit.com Bookmark September Unemployment: ACTUAL LOSS 995k at NewsVine Bookmark September Unemployment: ACTUAL LOSS 995k at blogmarks Stumble It!

http://market-ticker.denninger.net/archives/1485-September-Unemployment-ACTUAL-LOSS-995k.html

[bread_and_roses]

21. Those #s stagger even me

and I thought I was about stagger-proof, since I make the assumption that anything I hear being spouted as gospel is a lie in one form or another (if it's on NPR, it means enough other mainstream mouthpieces said it to make it so...I swear, I don't know why they don't call themselves National Propaganda Repetition or the maybe go all out and get new call letters for Talking Heads Digest).

[Demeter]

46. The Economy Loses 824,000 Jobs and the Post Doesn't Notice

http://www.prospect.org/csnc/blogs/beat_the_press_archive?month=10&year=2009&base_name=the_economy_loses_824000_jobs



One of the big pieces of news in the September jobs report released by the Labor Department yesterday was that the Bureau of Labor Statistics' (BLS) preliminary benchmark revisions showed that job loss had been 824,000 greater through March of 2009 than had been previously reported. This is a really big deal. It means that job loss averaged almost 70,000 more than originally reported each month over the year from March 2008 to March 2009.

The monthly jobs numbers are based on a survey of 160,000 businesses and governmental agencies. While this is a large sample, it necessarily excludes newly created firms that cannot be included in the sample. This would lead the sample to have a downward bias in measuring job creation.

On the other side, there are a large number of firms that go out business each month. Many of them may not feel the need to send back their survey to the BLS as they clean out their office. The non-response by firms shutting down could lead to an upward bias in measuring job growth.

To correct for both these problems, the BLS includes an imputation every month for jobs created in new firms and jobs lost in firms that have gone out business. This imputation is based on a "birth/death" model that estimates the number of jobs missed by the survey based on recent economic growth and other variables. While the model produces reasonably reliable estimates in normal times, it has been notoriously bad in missing turning points, underestimating job growth during upturns and overestimating job growth during downturns.

Economists who follow the data closely noted that the monthly imputations from this model had been running at about the same level or even slightly higher during this downturn than in the corresponding months of the prior year. (The imputations are not seasonally adjusted so it is necessary to measure January against January, etc.) Since it was absurd to imagine that new firms were creating as many jobs in the six months when the economy was in a free fall (October, 2008-March, 2009) as in the corresponding months of the prior year, it was virtually certain that the imputation was leading to a substantial overstatement of job growth.

This suspicion has now been confirmed with the BLS benchmark revision. This revision is based on data from state unemployment insurance records. These data are almost a complete census of payroll employment since more than 99 percent of employees are covered by state unemployment insurance. As a result of the release of preliminary data on this benchmark revision, we now know that the job loss in this downturn has been far more severe than initially reported, unless of course we rely on the Washington Post for our news. (The final data, which will be incorporated into the establishment numbers in the January jobs report, always are close to the preliminary data.)

--Dean Baker

[CatholicEdHead]

64. Repetitive news and people do not want to hear it

:sarcasm:

[Dr.Phool]

4. I want to atone for one of United Healthcare's sins.

I sent my gastroenterologist a check today for my colonoscopy they refused to pay for . A partial payment.

[ozymandius]

9. How else is the CEO gonna make $107,742 per hour if they pay for your claim?

Stephen Hemsley needs to eat. The poor dear.












:sarcasm:

[Dr.Phool]

41. I hope he chokes on an escargot.

Or eats a not so prepared correctly blowfish.

Or, at least terminal Montezuma's revenge.

[kickysnana]

8. Speaking of at-one-ment. Any opinions on "The Lost Symbol"?

I just read it. Thought it was written as a movie script unlike the previous two novels. Perhaps he couldn't bear for Disney to screw up another movie from his book.
It was not boring, just not as big a mind exercise as his previous books.

[Demeter]

12. I hardly read anything anymore. I'll wait for Tom Hanks (drool)

[Demeter]

13. Rolling Stone Reports that Naked Short Selling Killed Bear Stearns and Lehman Brothers

http://www.deepcapture.com/rolling-stone-reports-that-naked-short-selling-killed-bear-stearns-and-lehman-brothers/

Matt Taibbi has published a story in Rolling Stone magazine that nobody should miss. It’s not yet available on-line, so you’ll have to pick it up at the newsstands, but here’s a quick summary.

Taibbi writes:

“On Tuesday, March 11th, 2008, somebody – nobody knows who – made one of the craziest bets Wall Street has ever seen. The mystery figure spent $1.7 million on a series of options, gambling that shares in the venerable investment bank Bear Stearns would lose more than half of their value in nine days or less. It was madness – “like buying 1.7 million lottery tickets,” according to one financial analyst.”

Bear’s stock would have to drop by more than half in a matter of days for the mystery figure to make a profit. And that is what happened.

As Taibbi explains, “the very next day, March 12, Bear went into a free fall…Whoever bought those options on March 11th woke up on the morning of March 17th having made 159 times his money, or roughly $270 million. This trader was either the luckiest guy in the world, the smartest son of a bitch ever or…Or what?”

Taibbi speculates (as has Deep Capture) that these options might have been purchased by somebody who was abusing the options market maker exemption to engage in illegal naked short selling. And Taibbi goes beyond speculation to state, as an obvious fact, that illegal naked short selling helped bring Bear Stearns to its knees.

Presumably operating under that assumption, the SEC issued more than 50 subpoenas to Wall Street firms in the wake of Bear’s collapse, but “it has yet to indentify the mysterious trader who somehow seemed to know in advance that one of the five largest investment banks in America was going to completely tank in matter of days.”

Taibbi continues: “The SEC’s halfhearted oversight didn’t go unnoticed by the market. Six months after Bear was eaten by predators, virtually the same scenario repeated itself in the case of Lehman Brothers – another top-five investment bank that in September 2008 was vaporized in an obvious case of market manipulation. From there, the financial crisis was on, and the global economy went into full-blow crater mode.”

Taibbi notes that there were many other factors that made the economy weak. But he says that naked short selling is what pushed Bear and Lehman over the edge. If it weren’t for naked short selling – a massive “counterfeiting scheme,” in Taibbi’s words — those banks would likely have survived, and we might have avoided an all-out financial catastrophe.

This cannot be stressed enough. Criminals deliberately destroyed two of America’s biggest investment banks, precipitating the greatest financial cataclysm since the Great Depression. And the government has done absolutely nothing to bring those criminals to justice. In fact, as Taibbi makes clear in his story and on his blog, the most likely culprits are feted by top government officials in closed door meetings.

I’d call this the biggest financial and political scandal in the history of this country.

Certainly, it is, as Taibbi writes, “one of the most blatant cases of stock manipulation in Wall Street history.” Certainly, it is, as Taibbi writes, “the two biggest murders in Wall Street history.” And, certainly, it is odd that this very big story has appeared in Rolling Stone, but has yet to be covered by a single mainstream news publication.

The Wall Street Journal, The New York Times, Fortune, BusinessWeek – they have all known about naked short selling since Deep Capture reporter Patrick Byrne began hollering about it in 2005. But none of them write about it. Instead, we find a competent financial journalist, and the only major story about one the greatest financial crimes of all time, published in a slightly alternative magazine about music.

I worry for the Republic.

[Demeter]

14. Bernanke calls for higher insurance levies on big groups

IF ANYBODY KNOWS REPENTANCE, IT'S GOT TO BE BERNANKE. I BET HE REGRETS BEING BORN BY NOW.

http://www.ft.com/cms/s/0/2677744e-ae8e-11de-8464-00144feabdc0.html

Large financial institutions should face a costly combination of higher capital requirements, tougher regulation and higher insurance premiums “making it less profitable to be ‘too big to fail’”, Ben Bernanke told Congress on Thursday.

The chairman of the Federal Reserve said there was a case for levying higher premiums on the largest interconnected companies, amplifying the risk adjustment made by the Federal Deposit Insurance Corporation. “The FDIC risk adjusts the premiums they charge to banks for deposit insurance,” he told the House financial services committee. “Perhaps it’s time to revisit that.”

“There’s nobody more sick and tired of bail-outs than me,” said Mr Bernanke as he supported a Treasury proposal to impose onerous standards on companies and introduce a resolution regime to force creditors to take a loss in an orderly wind-down of a company. The plan is designed to prevent a repeat of the expensive bail-out of AIG and costly failure of Lehman Brothers.

Some economists have advocated a more draconian regime of narrower banks, returning to a forced separation of commercial and investment banking. But Mr Bernanke said: “I don’t think it’s possible – to reduce financial institutions to a size so small that there would not be any systemic consequences, and without losing substantial benefits of international financial flows, for example.”

In his testimony, Mr Bernanke sought to raise the Federal Reserve above the regulatory turf war, describing gaps in financial supervision but declining to make claims for more power.

However, the Fed chairman said he was keen that the institution did not become a pure monetary-policy setter and that the Bank of England’s loss of responsibilities had shown its weakness during the recent crisis.

“The fact that the Bank did not have the information it needed about the crisis was a real drawback,” he told the House financial services committee. Chris Dodd, the Senate banking committee chairman, has proposed consolidating banking regulation into a new agency.

Mr Bernanke has a delicate mission – preserving those Fed responsibilities he believes are central to a stable financial system against rival pitches from other regulators and an increasingly hostile Congress. He told the committee, which is drafting new financial regulation, that “all federal financial supervisors and regulators – not just the Federal Reserve – should be directed and empowered to take account of risks to the broader financial system as part of their normal oversight responsibilities”. The Treasury and some members of Congress believe the Fed needs to have the ultimate responsibility for regulating the largest systemically significant financial companies – such as AIG – which pose a risk to the entire system.

But other voices, such as that of Sheila Bair, chairman of the FDIC, supported by allies in Congress, are aiming to delegate that power to a new council of regulators.

[Demeter]

15. Surplus nations urged by IMF to take up baton

I GUESS THIS QUALIFIES AS MY HUMOROUS TENSION-BREAKER, THIS WEEK...

http://www.ft.com/cms/s/0/ceeff158-ade6-11de-87e7-00144feabdc0.html



Growth has returned to the world economy, the International Monetary Fund announced on Thursday, but the coming recovery will be weak unless countries with large trade surpluses pick up the baton as the motors of demand.

To ensure sustained growth into the medium term, surplus countries, including China, must act to boost domestic spending and accept an appreciation of their currencies, said Olivier Blanchard, the IMF’s chief economist.

The tough IMF stance on the measures China, Germany, Japan and oil exporters needed to take to ensure a global recovery strikes a chord with US views on global trade imbalances and puts the fund on a collision course with Beijing and Berlin.

With the first upgrade in the IMF’s economic forecasts for over two years, Mr Blanchard said the twice-yearly World Economic Outlook showed “the recovery has started, financial markets are healing, and in most countries growth will be positive for the rest of the year as well as in 2010”.

The IMF forecast that world economic output would rise by 3.1 per cent next year after contracting 1.1 per cent in 2009, an upward revision of 0.6 percentage points for 2010 from its most recent forecast in July.

Emerging economies will grow much more quickly than advanced economies, the IMF says, with growth averaging 5.1 per cent in the emerging world and only 1.3 per cent in rich countries.

Although the IMF dismissed fears of a double-dip recession, it stressed that the recovery was likely to be “weak by historical standards”.

Call to combat budget deficits:

The International Monetary Fund returned to type on Thursday, urging countries to fight budget deficits once recovery is secured, writes Chris Giles.

The IMF’s nickname has long been “It’s Mostly Fiscal” but since January 2008 it has been in the unusual position of advising countries to boost deficit spending. Normality is returning. Olivier Blanchard, IMF chief economist, said reforms to reduce deficits must be “confronted” as economies recovered. “That means reforms of the retirement system; that means reforms of the healthcare system.”

He added that the idea of writing new fiscal rules on paper rather than beginning the hard process of cutting entitlements “is a joke”.

Mr Blanchard warned that the upswing would be sluggish in the months ahead because it was based on public spending and restarting companies’ mothballed production lines as unsold stock was finally shifted. “This is true of the US and most other advanced countries, but it is also true of emerging market countries,” he said.

The IMF also held out little hope that rapid growth would put world output back on the path expected before the crisis. Its latest forecast for world output is roughly 10 per cent lower than its prediction in April 2007.

For the medium term, Mr Blanchard insisted that the world needed to rebalance demand away from public support and towards the private sector; and from trade deficit countries, such as the US, towards those with trade surpluses.

“The strength of the world recovery will depend on these two rebalancing acts,” he said.

Unlike the Group of 20 leaders, the IMF did not pull its punches on the need for global currencies to shift to fostering this rebalancing. “It is very hard to see how this could happen at current exchange rates,” Mr Blanchard told a news conference.

“In gen­eral it is very hard to see how global rebal­ancing doesn’t come with an appreciation of Asian ­currencies.”

Such an aggressive stance on the need for currency realignment and demand growth in surplus countries will not be popular in Germany, Japan and China, which argue they are not to blame for producing goods others want to buy.

But Mr Blanchard expressed confidence that surplus countries’ resistance would soon fade. “I think the difference is that, this time, global rebalancing may well be needed to sustain the recovery,” he said.

[Demeter]

22. The IMF Catapults From Shunned Agency to Global Central Bank

http://www.huffingtonpost.com/ellen-brown/the-imf-catapults-from-sh_b_306665.html

"A year ago," said law professor Ross Buckley on Australia's ABC News last week, "nobody wanted to know the International Monetary Fund. Now it's the organiser for the international stimulus package which has been sold as a stimulus package for poor countries."

The IMF may have catapulted to a more exalted status than that. According to Jim Rickards, director of market intelligence for scientific consulting firm Omnis, the unannounced purpose of last week's G20 Summit in Pittsburgh was that "the IMF is being anointed as the global central bank." Rickards said in a CNBC interview on September 25 that the plan is for the IMF to issue a global reserve currency that can replace the dollar.

"They've issued debt for the first time in history," said Rickards. "They're issuing SDRs. The last SDRs came out around 1980 or '81, $30 billion. Now they're issuing $300 billion. When I say issuing, it's printing money; there's nothing behind these SDRs."

SDRs, or Special Drawing Rights, are a synthetic currency originally created by the IMF to replace gold and silver in large international transactions. But they have been little used until now. Why does the world suddenly need a new global fiat currency and global central bank? Rickards says it because of "Triffin's Dilemma," a problem first noted by economist Robert Triffin in the 1960s. When the world went off the gold standard, a reserve currency had to be provided by some large-currency country to service global trade. But leaving its currency out there for international purposes meant that the country would have to continually buy more than it sold, running large deficits; and that meant it would eventually go broke. The U.S. has fueled the world economy for the last 50 years, but now it is going broke. The U.S. can settle its debts and get its own house in order, but that would cause world trade to contract. A substitute global reserve currency is needed to fuel the global economy while the U.S. solves its debt problems, and that new currency is to be the IMF's SDRs.

That's the solution to Triffin's dilemma, says Rickards, but it leaves the U.S. in a vulnerable position. If we face a war or other global catastrophe, we no longer have the privilege of printing money. We will have to borrow the global reserve currency like everyone else, putting us at the mercy of the global lenders.

To avoid that, the Federal Reserve has hinted that it is prepared to raise interest rates, even though that would mean further squeezing the real estate market and the real economy. Rickards pointed to an oped piece by Fed governor Kevin Warsh, published in The Wall Street Journal on the same day the G20 met. Warsh said that the Fed would need to raise interest rates if asset prices rose - which Rickards interpreted to mean gold, the traditional go-to investment of investors fleeing the dollar. "Central banks hate gold because it limits their ability to print money," said Rickards. If gold were to suddenly go to $1,500 an ounce, it would mean the dollar was collapsing. Warsh was giving the market a heads up that the Fed wasn't going to let that happen. The Fed would raise interest rates to attract dollars back into the country. As Rickards put it, "Warsh is saying, 'We sort of have to trash the dollar, but we're going to do it gradually.' . . . Warsh is trying to preempt an unstable decline in the dollar. What they want, of course, is a stable, steady decline."

What about the Fed's traditional role of maintaining price stability? It's nonsense, said Rickards. "What they do is inflate the dollar to prop up the banks." The dollar has to be inflated because there is more debt outstanding than money to pay it with. The government currently has contingent liabilities of $60 trillion. "There's no feasible combination of growth and taxes that can fund that liability," Rickards said. The government could fund about half that in the next 14 years, which means the dollar needs to be devalued by half in that time.

The Dollar Needs to be Devalued by Half?

Reducing the value of the dollar by half means that our hard-earned dollars are going to go only half as far, something that does not sound like a good thing for Main Street. Indeed, when we look more closely, we see that the move is not designed to serve us but to serve the banks. Why does the dollar need to be devalued? It is to compensate for a dilemma in the current monetary scheme that is even more intractable than Triffin's, one that might be called a fraud. There is never enough money to cover the outstanding debt, because all money today except coins is created by banks in the form of loans, and more money is always owed back to the banks than they advance when they create their loans. Banks create the principal but not the interest necessary to pay their loans back.

The Fed, which is owned by a consortium of banks and was set up to serve their interests, is tasked with seeing that the banks are paid back; and the only way to do that is to inflate the money supply to create the dollars to cover the missing interest. But that means diluting the value of the dollar, which imposes a stealth tax on the citizenry; and the money supply is inflated by making more loans, which adds to the debt and interest burden that the inflated money supply was supposed to relieve. The banking system is basically a pyramid scheme, which can be kept going only by continually creating more debt.

The IMF's $500 Billion Stimulus Package:
Designed to Help Developing Countries or the Banks?

And that brings us back to the IMF's stimulus package discussed last week by Professor Buckley. The package was billed as helping emerging nations hard hit by the global credit crisis, but Buckley doubts that that is what is really going on. Rather, he says, the $500 billion pledged by the G20 nations is "a stimulus package for the rich countries' banks."

Why does he think that? Because stimulus packages are usually grants. The money coming from the IMF will be extended in the form of loans.

These are loans that are made by the G20 countries through the IMF to poor countries. They have to be repaid and what they're going to be used for is to repay the international banks now. . . . he money won't really touch down in the poor countries. It will go straight through them to repay their creditors. . . . But the poor countries will spend the next 30 years repaying the IMF.

Basically, said Professor Buckley, the loans extended by the IMF represent an increase in seniority of the debt. That means developing nations will be even more firmly locked in debt than they are now.

At the moment the debt is owed by poor countries to banks, and if the poor countries had to, they could default on that. The bank debt is going to be replaced by debt that's owed to the IMF, which for very good strategic reasons the poor countries will always service. . . . The rich countries have made this $500 billion available to stimulate their own banks, and the IMF is a wonderful party to put in between the countries and the debtors and the banks.

Not long ago, the IMF was being called obsolete. Now it is back in business with a vengeance; but it's the old unseemly business of serving as the collection agency for the international banking industry. As long as third world debtors can service their loans by paying the interest on them, the banks can count the loans as "assets" on their books, allowing them to keep their pyramid scheme going by inflating the global money supply with yet more loans. It is all for the greater good of the banks and their affiliated multinational corporations; but the $500 billion in funding is coming from the taxpayers of the G20 nations, and the foreseeable outcome will be that the United States will join the ranks of debtor nations subservient to a global empire of central bankers.

query: Is this because of, or in spite of, alumnus Timothy Geithner?

[Demeter]

34. EBRD seeks 50% increase in capital

http://www.ft.com/cms/s/0/a0dffec0-ac51-11de-a754-00144feabdc0.html

The European Bank for Reconstruction and Development has appealed for a 50 per cent capital increase to mitigate the impact of the global economic crisis on central and eastern Europe.

The multilateral bank, controlled by some 60 governments, including European Union members, the US and Japan, is asking for an extra €10bn ($14.5bn, £9bn) to allow it to expand its lending and compensate for a sharp decline in private capital flows into the former communist countries.

The bank’s move, coming just before the International Monetary Fund’s annual meeting, highlights its concerns that the region’s difficulties should not be forgotten as world leaders grapple with the effects of the crisis...

[Demeter]

36. IMF warns on further institutional losses

http://www.ft.com/cms/s/0/3d7b9bde-ad44-11de-9caf-00144feabdc0.html

Banks around the world still have to reveal about half their likely losses resulting from the financial and economic crisis, the International Monetary Fund said on Wednesday, warning there was still a “significant” risk of another downward lurch in the global recession.

A failure to reveal the true scale of the losses they are likely to face and boost capital held in the banks would undermine the economies of the US, the UK and the eurozone and could generate a renewed vicious spiral where weak banks damage economic prospects, raising default rates and further threatening the health of banks, the IMF said...

[snot]

56. 1 of many items that deserves its own O.P.; but this one esp.

[femrap]

16. ATONE FOR THE GREED. nt

[Demeter]

18. Atone for the Stupidity, Fraud, and Propaganda--Atone for Reaganism!

[femrap]

42. Lots of Atoning to do

that's for sure.

I have 2 posters in my trunk....never know when I'll run into a good demonstration. Both have 'play money' taped to them. ATONE FOR THE GREED and WAR IS A RACKET

If people would abide by these words, the world wouldn't be half bad.


CARE FOR ONE ANOTHER would make the world pretty cool.

[Demeter]

17. Empty Gestures vs. Real Reform: How to Prevent 9.8% Unemployment From Becoming the 'New Normal'

http://blog.buzzflash.com/analysis/916

by Meg White

It's tough to put a rosy face on the unemployment numbers released Friday morning.

While we saw this same jobless rate as recently as 1983, the plunge mimics a much older feeling. Since the beginning of the recession in December 2007, the unemployment rate has doubled to 9.8 percent, a decline that hasn't been seen since the Great Depression.

As the U.S. Bureau of Labor Statistics makes public September's higher-than-expected unemployment numbers, you'll likely hear a lot of stories highlighting the disparity between Fed Chairman Ben Bernanke saying the recession is basically already over last month and the growing number of job-seekers in this country. National Public Radio's treatment of the story pointed out that jobs will lag well into next year, if previous recessions are any clue, and that we may experience a "jobless recovery" or even a "double-dip recession."

The announcement of September's jobless rate is coupled with a whispered warning of a "new normal," where we won't be surprised by nearly ten percent of our workforce being unemployed anymore. What seems untenable now may become ordinary, some economists warn. For example, last month on the anniversary of the U.S. economy hitting rock bottom, economic advisor and financial expert Alvin Hall told NPR's Jennifer Ludden that the recovery will come when we stop losing jobs, not when we start making them (emphasis mine):

I think the recovery will indicate itself when things stabilize, when the jobless rate stop rising. The new normal is looking at unemployment claims that are flat, the rise in unemployment stops. That's the new normal. Our day-to-day lives, we don't see yet the possibility of more income, but we can hold on to what we have. That's the new normal.

It's a depressing thought, which is probably why you don't hear many in the media fleshing out the term outside of financial reporting. After all, if those who are unemployed now saw their current position as endemic (if not for them, for some poor schmuck somewhere in the country) and not temporary, consumer confidence might plummet even further. So what do we do to stop this from becoming normal?

Well, MoveOn.org sent me an e-mail today urging me to head down to Sen. Roland Burris' office for an unemployment demonstration with an interesting twist:

The jobs situation is a crisis. So we're organizing a symbolic unemployment line TODAY in front of Sen. Burris's office in Chicago to call for passage of President Obama's clean energy jobs plan and the 1.7 million new jobs it would create.

My first reaction was to wonder if a "symbolic unemployment line" isn't somewhat insulting to those who have to stand in real unemployment lines. That thought aside, the demonstration is a smart one both ideologically and visually. First of all, very few can argue against the virtue of building a green economy. Second, the image of a line of needy people -- be it a bread line, unemployment line or the queue at Ellis Island -- is a potent political symbol in the land of plenty.

But, as it has proven itself very capable of doing time and time again over the past year or so, Move On has again misappropriated a salient symbol for use in a watered-down half-measure.

Green jobs are a necessity. They're surely part of the long-term plan if the United States wants to keep up in what Thomas Friedman recently called "the new Sputnik." The Space Race of our age is, no doubt, one of green tech, and the government must encourage and foster innovation.

But in truth, Move On's demand for "green jobs now" is nothing more than a temporary salve for what might be a permanent problem. The people now lining up before unemployment offices across the country are not, for the most part, going to be plucked from those lines by green entrepreneurs.

It's important to remember that the jobless rate is quite misleading, with soaring numbers of underemployed people, as well as those who have given up looking for a job, being overlooked in the mainstream press. With the average length of a job search growing beyond record levels, the unemployed are more desperate than in the past. Many of them are like this single mom interviewed for NPR's piece on unemployment today, who said she's "been looking for jobs that I never thought I would do in my life" just to keep from becoming homeless.

Green jobs initiatives are important, but they will not save this woman from being homeless. When college-educated, experienced workers are applying for jobs at Taco Bell, parading around a lame-duck senator's office while he's in Washington to "really show Sen. Burris that people in the Chicago area want action to create good jobs" will not shorten tomorrow's Temporary Assistance for Needy Families application line.

That's not to say there aren't things Congress can do to help mitigate the immediate problems of joblessness. The extension of emergency unemployment benefits by 13 weeks will help in the 26 or so states with high unemployment rates.

Demanding green jobs and strengthening stop-gap measures such as unemployment compensation will only help us eventually dig ourselves out, and won't force us to learn from our mistakes. We have to look at the root causes of this crisis and change the way we do business. Move On, with its lion's roar dimmed to a kitten's purr in non-election years, has been silent on many of the more controversial issues of the day, and has been extremely reticent to criticize the Obama Administration.

That's why independent Vermont Sen. Bernie Sanders' video address from a couple weeks back was so refreshing. He merged the very personal issue of unemployment with the root causes of the recession, and proposed that Congress actually -- gasp -- do something about it. The entire video is worth watching, but he ends with this strong appeal (emphasis mine):

http://www.youtube.com/watch?v=n0Twy-rFd-Y&feature=player_embedded

What we must demand -- and this is enormously important, very few people are talking about it -- is a new Wall Street. A Wall Street not designed to make hundreds of millions of dollars for their CEOs, but a Wall Street designed to help increase manufacturing in the United States, create decent jobs, help small businesses do something for the productive economy. Another area that we need to return to is our disastrous trade policies which allow Corporate America to throw American workers out on the street, move to China, pay people 50 cents an hour, bring those products back into this country. So there is a lot of work in front of us in terms of the economy. Let's stay focused on this issue, and don't believe anybody who is telling you, quote on quote, the recession is over.

It's easy for Move On to praise green jobs, but when is the last time you heard them talk about NAFTA or regulating Wall Street? I want to thank Sen. Sanders for having the courage to say what we all know, but can't seem to say aloud. Not only is this recession not over, no matter what the stock market or Federal Reserve Bank says, but job losses will continue unless we change the way we think of employment, business and the economy in this country.

[Tansy_Gold]

93. Unemployment now vs The Great Depression

I've been thinking about this for several weeks but have been too busy to do much posting. After making the big huge mistake of wandering around in GD and GD-P this week-end, I decided I'd better atone for my rank stupidity and come back where there's some sanity.

Anyway -- about unemployment.

One of my friends was saying the other day that she thinks there's a huge difference between unemployment now and when she was a small child in the '30s. (She was born in '31.) Then, she said, most of those who were laid off were wage-earners in single-income families, so the loss of those jobs left the entire family without support. Today, she thinks, there are a lot of two-income families -- or even quasi-families where roommates share expenses -- so that the workforce represents a higher percentage of working age individuals and therefore the unemployment percentage is lower than it would have been in the 30s. (am I making sense? it's been a rough week-end)

She also believes that many people who are being hurt particularly hard by job losses and so on probably have other financial resources that people didn't have in the 30s, even if only the leeway to cut out luxuries and extravagances that people who were living modestly didn't have.

While I think that may be true to a certain extent, I also think that our economy has shed so many jobs that there's no way to effect a recovery. Those jobs aren't needed -- they're being done by someone else, and the profits are accruing to the "capitalists" who engineered the shift.

If there's going to be a change in the US economy, it's going to have to be a bottom-up evolution, or it's going to be something else. Those at the top are NOT going to change unless forced to, and the only ones who can force them are those of us on the (relative) bottom.

I don't think an unemployment rate of 10% is going to be enough to effect change. I think there's still far too much slack in the rope. I also think our effective unemployment rate is probably closer to 20% or even a little higher, and even that isn't enough. Not enough to spark a real "revolution" in the way the US economy is managed.

Without an evolution, I think we have a real revolution waiting in the wings. It may come when there's a huge and catastrophic collapse within the economy, say a major bank failure or the sudden bankruptcy of a major industry. If, for instance, Ford or GM suddenly shut its doors, we might have something more active than internet protests, petition drives, and LTTEs. Or if one of the states declared bankruptcy.

But we're the frog in the water, and the heat's been turned up ever so slowly for ever so long. We may just get quietly boiled, and eaten, or we may suddenly wake up and hop out of the pot. But if we do slide into something that looks more like 1930s-style economic depression, we're gonna have a helluva lot harder time climbing out.


Tansy Gold, who also thinks there are a lot of really weird people populating other fora on DU. . . . .

[Demeter]

19. Detroit: Too broke to bury their dead

http://money.cnn.com/2009/10/01/news/economy/_morgue/

Money to bury Detroit's poor has dried up, forcing struggling families to abandon their loved ones in the morgue freezer.

DETROIT (CNNMoney.com) -- At 1300 E. Warren St., you can smell the plight of Detroit.

Inside the Wayne County morgue in midtown Detroit, 67 bodies are piled up, unclaimed, in the freezing temperatures. Neither the families nor the county can afford to bury the corpses. So they stack up inside the freezer.

Albert Samuels, chief investigator for the morgue, said he has never seen anything like it during his 13 years on the job. "Some people don't come forward even though they know the people are here," said the former Detroit cop. "They don't have the money."

Lifelong Detroit residents Darrell and Cheryl Vickers understand this firsthand. On a chilly September morning they had to visit the freezer to identify the body of Darrell's aunt, Nancy Graham -- and say their goodbyes.

The couple, already financially strained, don't have the $695 needed to cremate her. Other family members, mostly in Florida, don't have the means to contribute, either. In fact, when Darrell's grandmother passed recently, his father paid for the cremation on a credit card -- at 21% interest.

So the Vickers had to leave their aunt behind. Body number 67.

"It's devastating to a family not to be able to take care of their own," said Darrell. "But there's really no way to come up with that kind of cash in today's society. There's just no way."

The number of unclaimed corpses at the Wayne County morgue is at a record high, having tripled since 2000. The reason for the pile-up is twofold: One, unemployment in the area is approaching 28%, and many people, like the Vickers, can't afford last rites; two, the county's $21,000 annual budget to bury unclaimed bodies ran out in June.

"One way we look back at a culture is how they dispose of their dead," said the county's chief medical examiner, Carl Schmidt, who has been in his position for 15 years. "We see people here that society was not taking care of before they died -- and society is having difficulty taking care of them after they are dead."
0:00 /03:28Detroit's dead pile up

Detroit is not alone. The Los Angeles coroner's office said it, too, has seen an increase in the number of bodies abandoned. That's not surprising at a time when unemployment tops 10% in many cities and the median cost of a funeral in America hovers around $7,000. Cremation can cost $2,000.
Little help available

This is an issue of concern, said the Detroit mayor's office, but the city can't afford to offer any assistance. "The failure, through inability or choice, to bury the deceased is a reflection of the economic conditions that have arrested this region, where people are now forced to make emotionally compromised choices," said a spokesman in a prepared statement.

The state, however, does have some funds available to assist with burial costs. For fiscal year 2009, Michigan allocated $4.9 million for assistance, and of that, approximately $135,500 remains. Those in need of assistance can find grant applications at Michigan Department of Human Services offices, most funeral homes, and at Michigan.gov/dhs.

The Vickers did not know about the funds until CNNMoney notified them. But, fortunately, they were eventually able to scrape together the $695 and will be able to cremate their aunt with help from Social Security, social services and their aunt's church.

The way Darrell sees it, the stimulus package should have helped people in situations like this, rather than to "spark the economy and sell cars. We can't take care of our own when it comes to laying them to rest and letting them rest in peace."
'Reflection of the economy'

Believe it or not, the Vickers are among the fortunate.

Dozens of other bodies remain, some never identified. And they can't be disposed of until their families come forward or the county's burial fund is replenished when the 2010 budget is approved. There were 66 bodies before Aunt Nancy's, and they'll be interred on a first-arrived-first-buried basis.

"There are many people with sad lives," said Schmidt. "But it is even sadder when even after you are dead, there is no one to pick you up."

And in a town with so much need, Schmidt noted one more cause for concern: The increase in unclaimed bodies is not due to an increase in murders -- though the rate remains high -- but due to natural causes. Schmidt speculated that many of the deceased didn't have health insurance or could no longer afford medication for the chronic medical conditions.

"If anything is a reflection of the economy, that is a reflection of the economy," he said.

But this messy reality is shielded behind the Wayne County morgue's perfectly trimmed hedges and pristine brick walls.

"I feel sadness because I can recall when it was really booming," said investigator Samuels. "I don't think a lot of people are really aware that these types of things are happening in such a wide area."


AS A NATIVE DAUGHTER, I KNOW HOW DETROIT RESPECTED THE PASSING OF A PERSON--THIS IS JUST SO WRONG. I AM GOING TO HAVE TO RAISE FUNDS FOR CREMATIONS FOR DETROIT, SOMEHOW.

AND FOR COMIC RELIEF:

http://www.youtube.com/watch?v=grbSQ6O6kbs

I DO THIS AS A PRE-EMPTIVE ACTION, AS I AM SURE SOMEBODY WOULD IF I DIDN'T.

[Demeter]

45. How Detroit Went Bottom-Up

ALL THESE STORIES ABOUT DETROIT--AFTER 40 YEARS OF TOTAL NEGLECT. IF I WEREN'T SO BURNED UP ABOUT IT, I'D BE GRATIFIED.


http://www.prospect.org/cs/articles?article=how_detroit_went_bottom_up

Outsourcing cleared the way for a discreet but dangerous monopolization of the auto industry...


In the spring of 2005, David Stockman at last reaped the reward of the monopolist.

Stockman, who once served as Ronald Reagan's budget director, spent two decades on Wall Street preparing for this moment. After stints at Salomon Brothers and the Blackstone Group, Stockman in 1999 set up his own private investment fund, Heartland Industrial Partners. He then used Heartland to shape a set of companies -- mainly in the automotive sector -- each dedicated to dominating a particular group of production activities.

Of all Stockman's efforts, his most audacious centered on a firm named Collins & Aikman. Stockman used C&A as a vehicle to buy up small producers of interior components like dashboards and seats, and he swiftly captured a position supplying parts to more than 90 percent of all cars built in America. Although the acquisition spree left C&A saddled with debt, Stockman was so pleased with C&A's prospects that in 2003 he assumed control as chief executive officer.

When the time came to choose his first target, Stockman took aim at Chrysler. The company offered ready cash; Chrysler was still controlled by the deep-pocketed German automaker Daimler. And it had a fat vulnerability; in early 2005 the company had a big hit with its Chrysler 300 sedan. Stockman's message was simple: Pay a premium for C&A?manufactured components, or he would shut off the flow of critical supplies to the main assembly line of this highly lucrative car.

Not many years ago, it was all but unthinkable that a mere supplier would dare to hold up one of the Big Three in such a blatant manner. As The Detroit Free Press reported at the time, such acts were considered "the auto industry equivalent of a nuclear weapon -- rarely threatened and almost never used." But Stockman's gambit worked perfectly. Chrysler agreed to provide C&A with between $65 million and $75 million in the second and third quarters of 2005. Better yet, General Motors, Toyota, and other big automakers with North American plants heard Stockman's message loud and clear. Even without direct threats, they agreed to provide Stockman and C&A with another $260 million to $270 million in price increases and low-cost loans.

Unfortunately for Stockman, he appears to have mis-timed his play for a big payday. More specifically, this onetime head of the Office of Management and Budget (who in 1981 angered his fellow Reagan revolutionaries when he told reporter William Greider that "none of us really understands what's going on with all these numbers") failed to keep his own creditors at bay. On May 12, 2005, Stockman was fired by the C&A board. Five days later, C&A filed for bankruptcy.

In and of itself, Stockman's stickup of America's automotive industry is not an especially important event. The problem is that Stockman was not alone. In recent years, many other monopolists made similar plays in the supply system that serves the American automotive industry. The result was a process of bottom-up consolidation that revolutionized the financial and physical structures of the entire industry in ways that undermined its stability and sustainability.

This type of consolidation is not limited to the automotive sector. On the contrary, Stockman's monopoly and subsequent power play exemplify what we have witnessed -- often on a far grander scale- -- in most of the vital industries on which we rely.

The idea that America's automotive industry has been monopolized in any respect can seem absurd. After all, when we shop for a new car, many different companies vie for our dollars, with sometimes manic vigor. But under the hood, whether it's a Ford or a Chrysler or a Toyota, a growing proportion of the component parts were made by the same set of manufacturers, often on the same production lines.

This is remarkably different from the way the automobile industry used to be organized. Well into the 1990s, most manufacturers were vertically integrated and built most of the components for their products in their own factories. The great apostle of vertical integration was Henry Ford, who erected an industrial complex outside Detroit where ships unloaded coal and iron ore at one end and workers drove finished Model As onto railroad cars at the other. Over the course of the 20th century, almost all of America's biggest industrial corporations, including IBM, DuPont, and General Electric, adopted this same basic structure. One result of such vertical integration was that almost all key industrial activities were replicated many times over. In the auto industry, for instance, every firm manufactured its own alternators, piston rings, and windshield wipers.

Vertical integration was neither a necessary nor natural form of organization. The history of industrial activity is replete with systems in which many producers competed with one another in open market-centered arrangements. Early in the 20th century, Detroit was home to a great many small and medium-sized manufacturers engaged in vibrant competition. The vertical integration model is merely a business strategy, one that managers pursue to gain an advantage over their competitors or to protect themselves from predation. That said, in 20th-century America, the model became the norm.

In the late 1980s and early 1990s, managers in many industries began to embrace an alternative strategy: outsourcing. There was nothing especially new about outsourcing; the term implies little more than the disintegration of a vertically integrated firm. Nor was there anything mysterious about why managers began to split apart what their forebears had joined together. Laws and customs had begun to change.

One of the most important changes was private and voluntary. Impressed by the quality of Toyota's cars and the efficiency of its plants, American managers began to study that company's production methods, which aimed to eliminate all parts inventories through a more flexible use of machinery and workers. This led many manufacturers to embrace such related Toyota strategies as reliance on single sources of supply, often located outside the company.

Meanwhile, laws designed to bring American corporations more directly under the control of financiers encouraged corporate managers to focus more on making money and less on making quality goods. Liberalization of trade laws reduced fears -- both among managers and the population in general -- of mercantilist aggressions by nations like Japan, China, and Germany. Most important was the Reagan administration's overthrow of antitrust law in 1981, an act that established a new overarching goal for regulating competition. Rather than seek to ensure competition for the sake of competition, the aim now was to clear the way for any efficiencies that might benefit the consumer, no matter how much consolidation this entailed.

The result was an entirely new legal environment, one that made breaking up the traditional industrial complex much more attractive. Outsourcing offered a quick path to cash, as it enabled managers simultaneously to sell off in-house operations and to offload costly liabilities like union pensions. Outsourcing also promised longer-term savings as managers began to take advantage of the more lax competition laws to pool some production activities with rival companies. In the automotive industry this pooling took place in two ways. First, managers gathered in-house operations into new units and then spun these units off as independent firms that were free to serve competitors; two of the biggest products of this reorganization were Delphi, spun off by General Motors, and Visteon, spun off by Ford. Second, managers at different automakers increasingly turned to the same existing suppliers, like Bosch and C&A, for the same parts...

THIS IS A VERY LONG AN CRUCIAL ARTICLE, WORTH A CAREFUL AND CRITICAL READING. IF YOU READ ONLY ONE ITEM IN DEPTH, I'D RECOMMEND THIS ONE!

[Demeter]

20. Turkey: student protester hurls shoe at IMF chief

http://www.google.com/hostednews/ap/article/ALeqM5hDBumkqyw5XzdD_Hl21JA56lBMowD9B2E8FG0

By CHRISTOPHER TORCHIA (AP) – 1 day ago

ISTANBUL — A student journalist threw a shoe at IMF Director Dominique Strauss-Kahn on Thursday and ran toward the stage shouting "IMF get out!" as the finance official answered questions at a university in Istanbul.

The white sports shoe bounced off another student's head but missed the IMF chief before landing beside him on the speaker's platform. Some students applauded. Strauss-Kahn moved to the side, and a security guard rushed to protect him.

Other guards quickly blocked the man — a student and a journalist with a small left-wing newspaper — from reaching the platform. They pushed him to the floor, covered his mouth with their hands and then dragged him from the hall.

A female protester also tried to unfurl a banner while shouting "IMF get out!" but she was escorted out of the conference hall.

The conference was then cut short and the hall evacuated.

Both of the protesters were later released, the semiofficial Anatolia news agency said. It was not clear whether they will face any charges.

It was the latest copycat shoe protest imitating the shoe attack last year directed at former President George W. Bush by an Iraqi journalist in Baghdad.

Turkey and the International Monetary Fund are engaged in slow-moving talks about a new loan deal that could boost investor confidence, but Turkey has been reluctant to cut spending and implement austerity measures.

The debate has stirred nationalist sentiment among some Turks, who are suspicious of what they view as outside interference.

The shoe protester, Selcuk Ozbek, had attended the conference at Istanbul's Bilgi University as a guest student from another Turkish university, Anadolu, said Halil Guven, the dean of the Bilgi University.

Ibrahim Aydin, the managing editor of the Birgun newspaper, confirmed Ozbek worked for the paper but said he was not on duty Thursday and was not representing the paper at the conference.

"I don't think throwing a shoe involves violence, it has become a symbol in a culture of protest," Aydin said.

Strauss-Kahn had been answering questions by Turkish economy students and journalists at the time of the protest. He left the conference hall smiling and shrugged off the incident.

"It is important for us to have an open debate. I was glad to meet students and hear their views. This is what the IMF needs to do, even if not everyone agrees with us," he said. "One thing I learned, Turkish students are polite. They waited until the end to complain."

The IMF was also holding its annual conference in Istanbul. Police have detained more than 20 protesters in total.

Associated Press writers Suzan Fraser and Selcan Hacaoglu contributed to this report.

I WONDER IF NIKE COULD USE THIS TREND TO SELL THEIR PRODUCTS....

[Demeter]

23. More information on the Jewish religious holidays

http://www.godweb.org/JewishCalendar.htm

for those who are curious

[Demeter]

26. Stanford fails in bid to access insurance

http://www.ft.com/cms/s/0/aa1b9b96-ad25-11de-9caf-00144feabdc0.html

Sir Allen Stanford, the Texan financier accused of operating a $7bn Ponzi scheme, on Tuesday lost a court bid to access insurance funds to pay his mounting legal bills.

His UK lawyers on Tuesday withdrew an application to the Chancery Court in London that would have helped Sir Allen access a Lloyd’s of London directors and officers insurance policy to pay his legal bills.

The court heard that Sir Allen was recently “beaten up in prison” and had been in a “state of unconsciousness”.

The application, if successful, would have required Ralph Janvey, the US receiver in charge of Stanford’s financial empire, to permit Sir Allen to use the proceeds of the insurance policy to defend himself from civil and criminal litigation in the US and elsewhere.

Earlier this week, Mr Janvey obtained an injunction from District Judge Godbey of the Northern District of Texas preventing Sir Allen taking further steps in other courts relating to the insurance policies.

In the US court filing in which District Judge Godbey ordered Sir Allen to withdraw his UK request, the judge said: “It appears that Stanford is purporting to seek relief before another tribunal relating to the policies. Such actions by Stanford both violate the terms of this court’s prior orders, as well as threaten to interfere with this court’s jurisdiction over the policies.”

As a result of the order, lawyers representing Sir Allen on Tuesday withdrew their application in London.

Mr Justice Briggs, who presided over the hearing, ruled that Sir Allen would have to pay the costs of Tuesday’s hearing in spite of the fact that the application had been withdrawn.

Sir Allen, the billionaire founder of Stanford Financial Group who set up the Stanford 20-20 cricket tournament, is facing allegations that he was involved in an alleged $7bn Ponzi scheme.

Prosecutors in June accused Sir Allen and Laura Pendergest-Holt, Stanford’s chief investment officer, of pledging high rates of return on $7bn of certificates of deposit issued by Stanford International Bank, and then allegedly misappropriating most of the funds.

Sir Allen and Ms Pendergest-Holt have pleaded not guilty to all charges.

Sir Allen was hospitalised last week after a fight with another inmate at a detention centre in Conroe, where he has been held since his arrest in June. He was released on Monday.

However, his requests to move prison predate the attack and he was already in the process of being moved. He had already submitted a request to move prison several days before the attack and is in the process of being moved.

[Demeter]

27. Believe It or Not: Chinese insurers clear to invest in real estate

http://www.ft.com/cms/s/0/a2bbba4a-ad0a-11de-9caf-00144feabdc0.html

Chinese insurance companies will be allowed to invest directly in commercial real estate for the first time under new regulations that are set to trigger a huge influx of cash into the country’s high-end property market.

New regulations allowing insurers to invest in real estate go into effect on Thursday, although details on investment limits and what types of property insurers can buy will not be released for another month at least, according to regulatory officials.

Conservative estimates put the amount of potential new investment by Chinese insurers in commercial real estate at $34bn (€23bn, £21bn), according to Jones Lang Lasalle, the real estate consultancy.

Based on current average capital values, $34bn is equal to more than twice the value of the Shanghai Grade A office market.

China’s high-end, investment-grade market has seen average investment of just $8.5bn in each of the last two full years, and has been falling since the end of last year as a result of the financial crisis.

The new regulations were “a key step in a process that has already seen a marked shift from a foreign-dominated real estate investment market to one where domestic players have assumed pre-eminence”, said David Hand, head of investments for Jones Lang Lasalle China.

China’s insurers had combined assets of $540bn at the end of August and given the suitability of real estate as an investment to match long-term insurance liabilities, analysts say they are likely to invest as much as they are allowed.

Considering the Chinese government’s record on liberalising insurers’ investment scope in the past it is likely the insurance regulator will move slowly and allow insurers to invest only about 5-8 per cent of their assets in real estate at the initial stage.

Chinese insurers are currently allowed to invest up to 10 per cent of their total assets directly in equities and another 10 per cent in equity investment funds. Before 2006 they were not allowed to invest directly in equities at all.

The expected influx of insurance investment to China’s commercial real estate will provide a huge boost in leading markets such as Beijing, where one-third of the office space is empty, prices are falling and total floor space is expected to double between 2007 and 2011.

It also comes at a time when foreign interest in the Chinese market has dried up as a result of the financial crisis and the bursting of property bubbles across the world.

Most Chinese insurers are directly owned by the state and some, including the People’s Insurance Company of China, have said they intend to invest in low-income housing when the new rules come into effect.

The largest insurance companies have been positioning themselves for at least three years in anticipation of eventually being allowed to invest in real estate.

Most have bought large office buildings in the centre of big Chinese cities that are ostensibly for their own use but in reality far exceed their own corporate office space requirements.

ARE THEY CRAZY??!!!

[Demeter]

28. US to take flexible course on bonuses

http://www.ft.com/cms/s/0/53330a7a-adfd-11de-87e7-00144feabdc0.html

The US intends to take a flexible approach to interpreting global guidelines on bankers’ bonuses, a move likely to frustrate European nations that want clearly defined standards to be applied globally...

[Demeter]

29. Hatoyama faces daunting economic in-tray

http://www.ft.com/cms/s/0/b9cab032-ade2-11de-87e7-00144feabdc0.html


Gross national debt is climbing toward a terrifying 200 per cent of gross domestic product. Unemployment is at a record high. Price deflation is accelerating. Exports are anaemic. Welcome to government!

TAKE A GOOD LOOK AT JAPAN TODAY....THAT'S THE US IN 20 YEARS OR LESS. UNLESS A MIRACLE OCCURS.

[Demeter]

30. Wrekin ruby’s £11m value falls like a stone

http://www.ft.com/cms/s/0/6c76dffe-adec-11de-87e7-00144feabdc0.html

The Gem of Tanzania: the 2.1kg stone underpinned the balance sheet of a Midland construction group



One of the strangest tales in the history of company accounting looks increasingly likely to end with a fabled gem being downgraded to an unusual paper weight.

The Gem of Tanzania, a large ruby whose £11m valuation once underpinned the finances of a failed company with yearly turnover of £103m, may be worth as little as £100.

Rebuffed by large auction houses, administrators to Wrekin Construction, a Shropshire building company, are now planning to advertise the big purple rock in a small magazine whose subjects includes New Age crystals.

The police said on Wednesday that they were considering whether to mount a fraud investigation, while forensic accountants are already on the case.

After Wrekin collapsed in May it emerged that the main asset of the business was a £11m ruby. Derbyshire businessman David Unwin used the jewel, previously valued at £300,000, to revive the balance sheet of Wrekin, which he bought in 2007.

An FT investigation found that the gem was sold to a South African-born businessman for the equivalent of £13,000 in Tanzania in 2002. The jewel was then handled by at least one other intermediary before Mr Unwin bought it through a land deal.

Two key valuation documents acquired by Mr Unwin with the gem were denounced as forgeries by the purported valuers. Mr Unwin has consistently said that he is innocent of any wrongdoing. Supporters say that he would be the victim of any fraud.

Administrators to Wrekin at Ernst & Young, the accountancy firm, said on Wednesday that the 2.1kg gem would be advertised for sale in Rock ‘n’ Gem – a quarterly UK magazine, read by mineral collectors and devotees of “healing” crystals. The Gem of Tanzania will also be advertised on a website mainly devoted to selling second-hand industrial equipment.

It is understood that prestigious London auction houses rejected the gem because its value was too low. The fact that Ernst & Young is selling the ruby as a specimen suggests it cannot be cut profitably into individual jewels.

Marcus McCallum, a Hatton Garden gem dealer said: “The Gem of Tanzania may not be worth the cost of the advert. A two kilo lump of anyolite is probably worth about £100. A valuation of £11m would be utterly bonkers.”

[Demeter]

32. JPMorgan to build investment business overseas

http://www.ft.com/cms/s/0/18860f96-adfb-11de-87e7-00144feabdc0.html

JPMorgan Chase’s investment bank is planning a push to win more business outside the US by building on the group’s financial ties with companies around the world, its new head said.

Jes Staley, who was picked to lead JPMorgan’s securities unit in a surprise reshuffle on Tuesday, said he did not plan big changes to the business’s trading and risk-taking strategies.

“We are not planning any dramatic changes but we want to further harness the power of the international franchise,” Mr Staley, who was head of JPMorgan’s asset management business, told the Financial Times.

His comments will help quash talk that JPMorgan’s top managers, led by its chief executive, Jamie Dimon, were unhappy with the strategies and risk approach taken by the previous management team.

Mr Staley has told associates he is reluctant to revolutionise the tactics that helped the bank avoid the worst of the crisis and emerge as one of Wall Street’s strongest players.

But he said he wanted to deepen the securities’ business relationship with overseas companies by using JPMorgan’s global network of banking clients.

“JPMorgan’s reach in inter­national markets is unparalleled and this is going to be a key strength in an increasingly globalised world,” he said.

International banks such as Citigroup, HSBC and Deutsche Bank have tried to use their lending relationship to overseas companies to help their investment banks win business. They typically argue that banking contacts with business leaders give them an edge over “pure” investment banks such as Goldman Sachs and Morgan Stanley.

Under Bill Winters and Steve Black, Mr Staley’s predecessors, JPMorgan’s investment bank has made significant inroads outside the US. Nearly half of its revenues last year came from overseas.

Mr Winters was ousted in the overhaul after Mr Dimon ruled he would not be a candidate to succeed him as head of JPMorgan. That left Mr Staley, 52, as the heir apparent.

[Demeter]

33. BofA agrees $1bn part sale of asset manager

http://www.ft.com/cms/s/0/6d58045c-adec-11de-87e7-00144feabdc0.html


Bank of America agreed to sell part of its Columbia Management business to Ameriprise Financial for about $1bn, raising cash towards the eventual repayment of taxpayer funds...This rids BofA of an operation that became redundant following its acquisition of Merrill Lynch...

[Demeter]

35. China seeks big stake in Nigerian oil

http://www.ft.com/cms/s/0/9d714f96-ac60-11de-a754-00144feabdc0.html

A Chinese state-owned oil company is in talks with Nigeria to buy large stakes in some of the world’s richest oil blocs in a deal that would eclipse Beijing’s previous efforts to secure crude overseas.

The attempt could pitch the Chinese into competition with western oil groups, including Shell, Chevron, Total and ExxonMobil, which partly or wholly control and operate the 23 blocks under discussion. Sixteen licences are up for renewal.

CNOOC, one of China’s three energy majors, is trying to buy 6bn barrels of oil, equivalent to one in every six barrels of the proven reserves in Nigeria, sub-Saharan Africa’s biggest crude producer and a major supplier to the US...

Well, with demand down, this shouldn't be too difficult to pull off!

[Demeter]

37. See you all in the morning!

Time for bed....

[Dr.Phool]

39. Kick!

For the morning rush hour.

[Demeter]

43. Hi Folks! I'm Back From the Yard Sale

In spite of the inclement weather, we had a lot of people buying, selling and browsing. Since the football team is away this weekend, yard sales are the only game in town!

I did my part, on both ends. It's one of those traditions, you know.

Surprising that the the FDIC did so little business Friday. I do believe they are hard up for money. Pretty sad when the govt. can't afford to shut down a bank because of the insurance costs. Maybe a yard sale...

So, with all this lamentation, and clearing away, in comes the Festival of Lights, Diwali...

"...a significant festival in Hinduism, Sikhism, and Jainism, and an official holiday in India.<1> Adherents of these religions celebrate Diwali as the Festival of Lights. They light diyas—cotton string wicks inserted in small clay pots filled with oil—to signify victory of good over the evil within an individual.

As per Hindu calendar, the five day festival of Diwali is centered on the new moon day that ends the month of Ashwin and begins the month of Kartika, beginning on the 13th day of the dark half of Ashwin (Ashwin 28th) and ending on the 2nd day of the bright half of Kartika (Kartika 2nd). The main day of celebration varies regionally.<2><3>

In Hinduism, across many parts of India and Nepal, it is the homecoming of Rama after a 14-year exile in the forest and his victory over Ravana.<4> In the legend, the people of Ayodhya (the capital of his kingdom) welcomed Rama by lighting rows (avali) of lamps (dĭpa), thus its name: dīpāwali. Over time, this word transformed into Diwali in Hindi and Dipawali in Nepali, but still retained its original form in South and East Indian Languages...."

http://en.wikipedia.org/wiki/Diwali

"Spiritual significance


While Divali is popularly known as the "festival of lights", the most significant spiritual meaning is "the awareness of the inner light".

Central to Hindu philosophy is the assertion that there is something beyond the physical body and mind which is pure, infinite, and eternal, called the Atman. Just as we celebrate the birth of our physical being, Dipavali is the celebration of this inner light, in particular the knowing of which outshines all darkness (removes all obstacles and dispels all ignorance), awakening the individual to one's true nature, not as the body, but as the unchanging, infinite, immanent and transcendent reality. With the realization of the Atman comes universal compassion, love, and the awareness of the oneness of all things (higher knowledge). This brings Ananda (inner joy or peace).

Diwali celebrates this through festive fireworks, lights, flowers, sharing of sweets, and worship. While the story behind Dipavali varies from region to region, the essence is the same - to rejoice in the inner light (Atman) or the underlying reality of all things (Brahman)..."

Let's hope some of that inner light shines on our people and our nation, who desperately need a lantern in the darkness.

[snot]

57. Demeter, thanks so much for all you do.

[Demeter]

79. Thank you for reading it!

[DemReadingDU]

85. I'm working my way thru

Lots going on, thanks for all the postings!

[Demeter]

44. Childbirth at the Global Crossroads

http://www.prospect.org/cs/articles?article=childbirth_at_the_global_crossroads

Women in the developing world who are paid to bear other people's children test the emotional limits of the international service economy...


"Akanksha Clinic,... a clinic housing what may be the world's largest group of gestational surrogates -- women who rent their wombs to incubate the fertilized eggs from clients from around the globe. Since India declared commercial surrogacy legal in 2002, some 350 assisted reproductive technology (ART) clinics have opened their doors. Surrogacy is now a burgeoning part of India's medical tourism industry, which is slated to add $2 billion to the nation's gross domestic product by 2012. Advertisements describe India as a "global doctor" offering First World skill at Third World prices, short waits, privacy, and -- important in the case of surrogacy -- absence of red tape. To encourage this lucrative trend, the Indian government gives tax breaks to private hospitals treating overseas patients and lowers import duties on medical supplies.

In his 2007 book, Supercapitalism, Robert B. Reich argues that while industrial and clerical jobs could be outsourced to cheaper labor pools abroad, service jobs would stay in America. But Reich didn't count on First World clients flying to the global South to find low-cost retirement care or reproductive services. The Akanksha clinic is just one point on an ever-widening two-lane global highway that connects poor nations in the Southern Hemisphere to rich nations in the Northern Hemisphere, and poorer countries of Eastern Europe to richer ones in the West. A Filipina nanny heads north to care for an American child. A Sri Lankan maid cleans a house in Singapore. A Ukrainian nurse's aide carries lunch trays in a Swedish hospital. Marx's iconic male, stationary industrial worker has been replaced by a new icon: the female, mobile service worker.

We have grown used to the idea of a migrant worker caring for our children and even to the idea of hopping an overseas flight for surgery. As global service work grows increasingly personal, surrogacy is the latest expression of this trend. Nowadays, a wealthy person can purchase it all -- the egg, the sperm, and time in the womb. "A childless couple gains a child. A poor woman earns money. What could be the problem?" asks Dr. Nayna Patel, Akanksha's founder and director.

But despite Patel's view of commercial surrogacy as a straightforward equation, it's far more complicated for both the surrogates and the genetic parents. Like nannies or nurses, surrogates perform "emotional labor" to suppress feelings that could interfere with doing their job. Parents must decide how close they are willing (or able) to get to the woman who will give birth to their child.

As science and global capitalism gallop forward, they kick up difficult questions about emotional attachment. What, if anything, is too sacred to sell?

.........Observers fear that a lack of regulation could spark a price war for surrogacy -- Thailand underselling India, Cambodia underselling Thailand, and so on -- with countries slowly undercutting fees and legal protections for surrogates along the way. It could happen. Right now international surrogacy is a highly complex legal patchwork. Surrogacy is banned in China and much of Europe. It is legal but regulated in New Zealand and Great Britain. Only 17 of the United States have laws on the books; it is legal in Florida and banned in New York.

In India, commercial surrogacy is legal but unregulated, although a 135-page regulatory law, long in the works, will be sent to Parliament later this year. Even if the law is passed, however, some argue it would do little to improve life for women...

[Demeter]

47. BILL BONNER OF DAILYRECKONING. COM

BITS AND PIECES...


We have insisted - with no proof, up until now - that the mom and pop investor is no longer counting on the stock market for his retirement. He's seen what can happen. At the low in March, adjusted for inflation, he was back to where he was 40 years ago. That is, in real terms, he had not made a dime from the stock market (aside from dividends) during his entire adult lifetime.

We guessed that he was not buying stocks.

Now, here's the evidence: according to TrimTabs, only $2.5 billion has gone into equity mutual funds in the last six months. Bond funds have attracted 13 times as much money as equity funds, says a Morningstar report...

...If it is a real bull market, then it's a funny looking bull - one that's missing parts!

For example, corporate earnings are missing. P/E ratios are rising far above the corporate earnings that support them. This puts the market 35% overvalued, on a cyclically adjusted P/E basis, says Smithers & Co. And if you look at it in terms of its "q" ratio - a comparison of capitalization to replacement costs - the S&P is even more overvalued. As for emerging markets - "they're off the charts," says The Financial Times.

Another missing part is the consumer.


Red October

Uh oh...maybe it will be a Red October after all...

Two important things happened yesterday (THURSDAY, OCT.1), both of which cast a crimson light on things.

First, the Dow dropped again; it has only gone up one of the last 7 days. It went down 203 points. Could be nothing. Could be something big...the beginning of the long awaited 'next leg down' for the bear market...the opening day of a bloody Red October.

Charts of oil, commodities, copper, the dollar, and Treasury bonds tell us the same story. The greed investments are topping out. The fear investments are headed up.

What's a 'greed investment?' It's anything that benefits from an improving outlook for the economy and inflation - oil, commodities, and stocks, mainly.

What's a 'fear investment?' It's something that goes up when people begin to suspect the boom is a phony - namely the dollar and US Treasury bonds.

The dollar is rising. So are Treasuries. Yesterday, 30-year US Treasury bond yields fell below 4% for the first time since April.

And what about gold?

Well, that's the other important thing that happened yesterday. Gold held above $1,000.

So what?

So what?? Well, dear reader, you are in a prickly mood this morning, aren't you?

This is important because gold could go either way. Gold is a refuge in times of fear - especially when people fear inflation or a falling dollar. Gold is also a target of greedy speculators sometimes, even when the going is good. According to a study done by the World Gold Council, you never know what gold will do. That study was a great comfort to us here at The Daily Reckoning; we thought we might have missed something. But no. We may not know what gold will do, but neither does anyone else.

Looking around, we see no sign of consumer price inflation. So gold's recent rise must have been driven by optimistic speculation - along with oil and stocks. Now, when oil and stocks go down... we have to wonder whether gold will go down too. The answer, given yesterday, was what we expected - yes, but not as much.

There's substantial risk in gold as well as stocks. The ultimate low for the Dow should be below 5,000. That is, let's say, about a 50% haircut from current levels. And let's assume that gold does what it did yesterday...let's suppose that it goes down only 40% as much as stocks. That would still be a drop of 50% of 40%, or 20% - to the $800- an-ounce level.

If you would be gravely upset by a drop of that magnitude...you probably shouldn't buy gold at this level. And, of course, you should have sold your stocks already. Stick to cash - and gold, if you're long-term oriented - until this next phase is over.

The economic news was mixed, as usual...with nothing to make us think that our basic outlook is wrong.

On the optimistic, bullish side...consumer spending rose in August. Pending homes sales went up too.

But on the pessimistic, bearish side... "September auto sales plunge," says a Reuters headline. Yes, auto sales drove off a cliff last month - just like we said they would. GM reported a 47% drop.

What happened? The clunkers program was an economic fraud. Like all attempts to boost consumption, it merely shifted sales from the future to the present (now the past). Which is a big reason why August consumer spending looked good too.

But wait a few weeks for the September consumer spending numbers. Especially if the stock market continues to fall... Then we'll find out how sustainable those retail sales numbers really are...

Meanwhile, from Phoenix comes news that a new wave of defaults is about to slam into the mortgage industry. Commercial properties, retail space, office complexes, apartment buildings are hard to rent. You can see why. In 2007, America was already outfitted with far more retail space than it actually needed. Americans had gone on a shopping spree for the previous ten years...prompting builders to add more and more space. By 2006, the United States had 10 times as much retail space per person as France. This was the bubble phase of a boom in consumer credit that began in 1945.

When you get to the bubble phase, few people stop to ask questions. Instead, everyone assumes that the trends in place will remain...and even intensify. So even into 2008, in Phoenix as well as other growing areas - principally in the sand states - the building continued. And now it is 2009. Where are the shoppers? Where are the renters? Alas, they are thinner on the ground than anticipated...and the developers are having trouble paying their mortgages. Commercial mortgage backed securities are carrying 5 times the unpaid balances they had in June '08, says Bloomberg.

Imagine how disappointed lenders will be when these loans default. And then, imagine how American investors will feel when a new wave of mortgage defaults and foreclosures is hits the commercial property market.

A new wave of foreclosures and falling house prices may be approaching the housing market too. Alan Abelson, in this week's Barron's, reports on the outlook as described by Amherst Securities. The research group estimates an overhang of 'hidden inventory' of some 7 million units. These are properties owners would like to sell - if and when the market strengthens. Trouble is, the market may not strengthen soon enough. Then, many of these hidden properties could come right out in the open, as mortgages are reset, marriages break up, and people move on. Amherst says these people are in the "delinquency pipeline" which eventually flushes out the market. And it calculates that another 300,000 properties enter the pipe every month.

Falling prices have reduced 'owners' equity' - the part of the house the homeowner owns free and clear of a mortgage - to only about 43%. This number includes people who have no mortgage at all - more than 50 million of them. Abelson speculates that the actual equity in the hands of the 'owners' of mortgaged houses must be substantially less. Pushed by joblessness...not to many life's other, normal hazards...many of these people are surely going to default. Of those in the "delinquent pipeline," nearly 10% haven't made a payment in more than two years. Sooner or later, the banks and mortgage holders will be forced to take action...and more houses will come onto the distressed property market.


More news from The 5 Min. Forecast:

"China could be the world's second biggest economy as soon as 2010 and the world's largest in as little as twenty years," writes Ian Mathias in today's issue of The 5. "This altered trajectory is courtesy of the IMF, which revised its World Economic Outlook yesterday. In short, emerging nations with strong export economies (like China) will drive global growth in the next two years while more established economies like the US, Eurozone and Japan will lag behind.

"Specifically, the IMF expects China to continue growing around 8-9% a year as Japan - the world's second largest economy - will be lucky to grow much faster than 1.7%. Plug that in some fancy charting software, and you get this:

Chinese Economic Upswing

"With Japan a foregone conclusion, China now sets its sights on I.O.U.S.A. The IMF has no projections that far away, but researchers at the Nomura Institute of Capital Market Research proclaimed this week that China will pass the US sometime between 2026-2039, depending on yuan appreciation.

"We're skeptics, if only because it's such a widely held belief nowadays that China will inevitably rise to the top. Before they get there, they'll have to rewrite their entire economic credo, the current staple of which is American over-consumption. And it was only 20 years ago when every broker was convinced Japan would soon be the world's economic powerhouse. Eight of the world's ten biggest companies were Japanese in 1988. Today, the biggest (Toyota) is 22nd and only five others are in the top 100.

"But there is one thing that might 'make it different this time': people. 1.3 billion Chinese people, to be specific:

China GDP

"If China can ever monetize its massive population, they'll leave us all in the dust."

[Demeter]

48. Hooray, It's a Depression!

http://dailyreckoning.com/hooray-its-a-depression/

...According to a pair of researchers from the University of Michigan, a depression does more for longevity than diet or exercise. Life expectancy during the worst years of the Great Depression increased from 57.1 years in 1929 to 63.3 years in 1933, says the report by Jose A. Tapia Granados and Ana Diez Roux. It didn't matter whether you were a man or a woman, black or white. And it didn't matter if you were in the US during the Great Depression or in Spain, Japan or Sweden during their economic downturns. The results were the same.

By contrast, life expectancy declined during the boom years. For most age groups, "mortality tended to peak during years of strong economic expansion (such as 1923, 1926, 1929 and 1936-1937)," they wrote in the "Proceedings of the National Academy of Sciences."

Conventional wisdom holds that recessions are times of stress. People do not eat as well. They skip medical check-ups. They should drop dead earlier. Instead, they live longer. Perhaps it is because the economy slows down, allowing people to live at a more comfortable pace. Maybe the unemployed get more sleep. We don't know. But if you want to live an extra six years, nothing works like a slump. When it comes to economic health too, nothing beats a depression....Americans are saving again...rebuilding their balance sheets...and, eventually, their economies. They can even look forward to living longer. And with a little more bad luck, maybe their moron economists will wise up too.

[ozymandius]

58. Bob Swern at Daily Kos says the same thing: it's a depression.

10 Stunning New Truths On Wall St., Economy, Jobless

Aside from wondering what the hell the Federal Reserve's done with the entire net worth--and then some--of the United States, there's no longer any need (or, at least, not nearly as much of a need) for speculation about many of the facts relating to our economic downturn and Wall Street's misdeeds, many touched upon herein. Much new information is coming to light now--stunningly, in black and white.

Here are the downright alarming, unpublicized, and less-publicized, truths--the backstory, so to speak--behind Friday's U.S. Department of Labor's Bureau of Labor Statistics' (BLS') Monthly Employment Situation Report for September 2009, along with related, less-publicized facts of late about our economy and Wall Street, in general:

1.) IT'S NO LONGER JUST THE "WEAKEST JOB MARKET SINCE THE GREAT DEPRESSION;" IT'S NOW, OFFICIALLY, "THE GREATEST NUMBER OF JOB LOSSES SINCE THE GREAT DEPRESSION." We are now, officially, witnessing the greatest percentage of job losses this country's experienced since the Great Depression, per upcoming revisions to be formally posted by our government in February 2010. (See #2, below.) See the link to this compelling, revised chart, two paragraphs, below (but most recently posted at DKos in its older format by Meteor Blades, yesterday, in "Job Losses Far More Than Expected. U6 Hits 17%;" in that FP story, we were reminded that it's the: "Weakest employment market since the Great Depression").

But, here's the update, this time with with the Bureau of Labor Statistics' Annual Benchmark Revision included in it, highlighting this snowballing employment/unemployment story, now posted at Calculated Risk, which demonstrates, officially, that we're now in an unemployment cycle which includes the greatest number of job losses since the Great Depression, too: "Comparing Employment Recessions Including Revision."

.....
2.) SEPTEMBER'S EMPLOYMENT REPORT, DELIVERED YESTERDAY, INCLUDED STUNNING "ANNUAL BENCHMARK REVISIONS," DEMONSTRATING AN UNDERCOUNTING OF UNEMPLOYMENT BY 15%, BURIED BENEATH THE FOOTNOTES OF THE STANDARD, MONTHLY REPORTS. This new information, just being reported upon, extensively (now, a day later), is nothing short of stunning with regard to its implications. Here's the link to it, but you have to scroll far down, past the standard Monthly Employment Situation Report, to access it: right HERE.

.....
3.) THE TRUTH: IT IS, ALREADY, A BRUTAL DEPRESSION FOR MUCH OF THE U.S. AND THOSE TRUTHS ARE PROJECTED TO GET WORSE, NOT BETTER. Generally speaking, the numbers from yesterday's BLS' U.3 Index calculations, noted in the blockquote, immediately below, may be doubled, easily and without exaggeration, to account for those actually unemployed and underemployed.

This post is peppered with links to websites with relevant data. What I find so stunning about this assemblage of information is that we have not seen this put together in one place before. Sure, we who pay attention to this stuff every day can intuit the conclusions made here. It sure is an eye opener to see the intuitive conclusions made whole with such clear articulation.

[Demeter]

60. So, Is It Official, then?

No more dancing around the truth, and covering one's eyes to prevent viewing the mysteries?

that's some article--I recommend reading it all!

[CatholicEdHead]

65. We still seem to be tracking the long drop of the 1930's

from numerous posts at SMW and WEE. Most people look at the stock market averages and wonder what is up as it does not remotely reflect what is happening day to day across the country.

[Demeter]

49. A Look at Strategic Oil Reserves - Who's Buying Oil?

http://dailyreckoning.com/a-look-at-strategic-oil-reserves-whos-buying-oil/

by Marin Katusa
Vancouver, British Columbia


As the US strategic petroleum reserve (SPR) approaches capacity (721.5 million barrels filled out of a total possible 727 million, and will be filled by January 2010), the federal government will fade out of the oil-buying business. Some bearish traders believe that this factor can weigh in on prices, since most petroleum stocks in the United States are government-held rather than private. Bullish traders have also used the filling of the Chinese SPR as a reason that oil should go much higher.

The team at Casey's Energy Opportunities believe that planned government buying or selling of crude oil for SPRs actually have very little impact in the overall market. However, an overall drawdown of worldwide inventory could put downward pressure on the price of oil. The various countries also have their particular reasons and influences in decisions to tap their reserves.

So which countries are executing preparedness plans to fill their strategic reserves with $70 oil now (as opposed to $140+)? Below are the 10 countries that consume the most oil in the world, as of 2008, the latest figures available from the BP Statistical Review of World Energy:

Top 10 World Oil Consumers

Russia, Canada, and Saudi Arabia can leave the list, as they are net exporters of oil and thus do not actually require a strategic reserve, at least in the short term. We'll also bump Brazil, because its balance of imports is dwindling every year, and it should become a exporter before it requires a reserve. That leaves six countries to examine:

The United States

Not surprisingly, America has the largest strategic reserve in the world in an absolute sense. Its 727 million barrels are stored in four hollowed-out salt domes (and one pending) along the coastline of the Gulf of Mexico. These add up to some 62 days' worth of imports, according to government sources. The United States government currently has plans to push this to 1 billion barrels, or about 85 days' worth of imports, which would make the reserves equivalent to those of Japan and Korea.

The SPR build-up will be accomplished by expanding two of the current facilities, for an additional 113 million barrels, and (probably) building a new one in Richton, Missouri, for 160 million barrels. The Richton project has met local opposition, because it would require pumping 50 million gallons of freshwater per day from the Pascagoula River to dissolve enough salt to open up another subterranean cavern. The total cost of the program is estimated at US$3.7 billion, not including the cost to fill the reserves. Oil purchases are likely to be slow, at around 100,000 bpd (barrels per day) before 2014 and 150,000 bpd thereafter.

In a real emergency, the combined American strategic and commercial reserves (the latter held by private corporations, especially refiners) may seem unnervingly thin from the perspective of energy security. Add to that the fact that the government can release them at a rate of only 4.4 million barrels per day, or about half its imports.

Still, the 108 or so days' reserve it has between government and commercial sources are considered adequate by international standards. The United States has used this reserve twice in the past 20 years (Desert Storm and Hurricane Katrina) to combat severe demand or supply disruptions. It also has the luxury of importing more oil from Canada in an emergency.

Scenarios that could force a sustained drawdown of reserves:

# Sustained hyperinflation in the United States due to actions by the Federal Reserve that causes oil-producing countries to look for better markets to sell oil.


# A prolonged general embargo by OPEC on the United States, forcing America to look to traditional partners such as Canada and Mexico, though they might not have sufficient oil.


# Another war, potentially in North Korea or Iran, requiring a large amount of oil input from America that it simply does not have.


# A particularly active hurricane season that knocks out a large amount of production capacity in the Gulf of Mexico, and the United States releases from the SPR to help.

China

China's strategic reserves began being built in 2004, when leaders in China began to realize that the country had no adequate government- controlled reserves to combat any disruptions in the supply of oil. China is a large importer and is dependent on the same sources of foreign oil as the United States. China is even more anxious to build such a reserve, as two of its neighbors, Korea and Japan, both have large strategic reserves.

China currently has four government reserves with a total reserve potential of 272 million barrels, which translates to about 30 days' consumption. Two of the four have been confirmed full, and there are rumors that all four are and that China has taken advantage of the recent precipitous drop in the price of oil to buy up. According to Chinese government sources, however, the reserves are likely not to be completely full until 2010, and 2009 buying of oil will be at around 42 million barrels.

The government has also announced plans to increase the country's reserve from 30 to 100 days of consumption. The next stage of the development will call for an additional 170 million barrels in eight storage facilities. The locations of the facilities are as yet secret.

In an emergency, China would likely turn to Russia to buy oil, though only the naive would be surprised if Russia added a premium for the privilege.

Scenarios that could force a sustained drawdown of reserves in China:

# Worldwide embargo on China due to a Chinese invasion of Taiwan.


# High oil prices force Chinese industries out of business, pressuring the government to keep oil prices low domestically by selling some of the reserves to domestic companies.


# North Korea asks for oil from China to support military action on the Korean Peninsula, and China ships it to them on the black market.


# Russia slows or stops its exports as part of the Russian "dominance via energy" strategy, leaving Chinese pipelines trickling and Chinese industries disrupted.

"Thus, a concerted effort by the worldwide reserves can definitely keep prices down in the short term (within a year, two at best), but cannot make for a paradigm shift in the supply/demand model of oil or the Peak Oil argument."

Japan/South Korea

We have placed Japan and South Korea's reserves together, as the two countries have a treaty that allows them to share their strategic reserves.

Resource-poor Japan has one of the world's largest strategic oil reserves, enough for 82 days of imports. State-controlled reserves are run by the state-owned Japan Oil, Gas, and Metals National Corporation. The reserves consist of 320 million barrels in 10 different locations, which makes them second only to the United States in absolute volume. Japan's island geography means that having an emergency supply of crude oil is crucial, and the Japanese government obviously has not ignored this aspect.

South Korea is in one of the global "hotspots" in the world, right beside North Korea. As the country is under an almost constant threat of war, the government has stocked up some 76 million barrels, with capacity for an additional 40 million barrels.

Scenarios that could force a drawdown of reserves:

# Just one at this time, from two possible sources: political instability in the region caused by either the Taiwan or the Korea conundrums disrupts tanker transport, perhaps even forces them to port.

India

India has a small reserve it began to build in 2004. This stockpile is sufficient for perhaps only two weeks of consumption. The country eventually wants to raise this level to 45 days, though the first phase has not even been completed yet. The projects are estimated to come online in 2012, which means it has taken eight years from planning to completion. These figures imply that India will not even have a somewhat sufficient strategic reserve until 2016, given that the expansion project was approved in 2008.

Germany

Germany has the largest reserve in Europe and is among the top in the world as well. Its government has satisfied a federal law that regulates storage be at least 90 days' worth of net imports. More than half of the storage is in Southern Germany, where large salt caverns exist. Germany is well prepared in its strategic oil reserves, and there are no glaring factors that would force a drawdown of reserves, barring a global catastrophe. Furthermore, the reserves of Germany, France, and Italy are pooled and can be used by any of the three countries in an emergency.

So How Much Do the Reserves Matter?

According to the US Energy Information Administration (EIA) estimates, some 2 billion barrels are held in government-owned strategic reserves around the world. Though this seems like plenty of oil, does it really impact the spot price of oil? Collectively, the answer is yes, as this volume corresponds to 23 days' worth of global consumption. If drawn down together over a short period of time, the effect on spot price could be substantial.

For illustration's sake, suppose that countries collectively draw down their entire reserves over the period of a year. This rate would make up for 10% of the daily worldwide trade of crude oil, which could certainly impact price (imagine ConocoPhillips and ExxonMobil both going under at the same time).

Individually, however, even China and the United States have a limited impact on the spot price of oil over a single year. If the United States' inventory were drawn over an entire year, it would only make for a 4% increase in supply. Under normal buying patterns of each country's strategic reserves, the impact is even smaller. Since China's 42-million-barrel purchase is over one year, their purchase would not even make a dent in the daily trade of oil.

Thus, a concerted effort by the worldwide reserves can definitely keep prices down in the short term (within a year, two at best), but cannot make for a paradigm shift in the supply/demand model of oil or the Peak Oil argument. And from the buying side, if governments plan the filling of their strategic reserves, the impact on the spot price of oil is likely to be minimal.

Perception is a tricky horse to ride, however, as we all know. Given a worldwide panic for oil à la the 1973 oil embargo, oil prices could spike in the short term, because government reserves would likely raise purchases 10% or so in a real emergency. This effect would be short lived for the foreseeable future, though, as worldwide reserves are already reaching their limits.

In short, if everything goes according to "plan" by the governments, even filling a large reserve such as the Chinese SPR would have little impact on the price of oil. For SPRs to truly impact the spot price of oil, it would have to be a global situation, with war and embargo the two most likely scenarios. Even then, the impact would be mellowed by limitations on how quickly governments can either release or purchase the oil.

Regards,

Marin Katusa
for The Daily Reckoning

[Demeter]

50. Could the Recession Be Good for Your Health?

http://news.yahoo.com/s/hsn/20090930/hl_hsn/couldtherecessionbegoodforyourhealth

TUESDAY, Sept. 29 (HealthDay News) -- The economic downturn may not be all bad. In fact, U.S. researchers say recessions may actually be good for health.

University of Michigan researchers looked at death rates during the Great Depression, the worst economic slump in the 20th century. From the stock market crash of 1929 through the early 1930s, economic activity fell sharply, dropping 14 percent in 1932, while unemployment hit 22.9 percent that same year.

Black and white images from the era of bread lines and migrant farmers make it easy to assume the economic misery would have affected public health.

But when the researchers looked at mortality rates among men, women and children from 1920 to 1940, they found death rates declined during years of falling economic activity and rose when times were better.

The study is in the Sept. 28 online edition of the Proceedings of the National Academy of Sciences.

During the two decades spanning the 1920s and 1930s, overall life expectancy increased by 8.8 years. But it wasn't a steady rise, instead shooting up and falling back in a pattern that correlated with the rise and fall of economic activity.

Between 1921 and 1926, the so-called "Roaring 20s" and a time of robust economic growth, life expectancy for non-white men fell by 8.1 years. Yet between 1929 and 1933, the years of steepest economic decline, their life expectancy grew a similar amount.

Likewise, non-white women lost 7.4 years of life expectancy during the Roaring 20s, but they gained 8.2 years of life expectancy during the Depression.

Whites showed a similar pattern, though the loss in life expectancy wasn't as extreme as for non-whites.

"The basic finding of the paper is that mortality rates tend to evolve in parallel to the economy," said lead study author Jose Tapia Granados, an assistant research scientist at University of Michigan Institute for Social Research. "When the economy goes up, mortality tends to go up. When the economy goes down, mortality rates tend to go down, too."

Researchers did find one exception. During the 1920s and 1930s, two-thirds of all deaths were caused by cardiovascular and renal diseases, cancer, influenza and pneumonia, tuberculosis, motor vehicle accidents and suicide.

All became less deadly during difficult economic times, with the exception of suicides. But suicides accounted for fewer than 2 percent of all deaths, not enough to alter the overall trend, the study authors added.

The country's climb out of the Great Depression began in 1933. The economy grew by more than 10 percent annually from 1933 to 1936. Mortality again peaked in 1936, four years after the worst year of the Depression, even for children under age 4.

The surge in deaths in 1936 isn't just attributable to lag time, the researchers noted. Deaths from motor vehicle accidents went up, in which lag time would not play a role.

So why would the return of good times be bad for health?

More economic activity means people have money to drive cars, meaning more die in auto wrecks, the researchers theorize. In the 1920s and 1930s, cars became objects of mass consumption.

As motor vehicle use increases, so does pollution. Recent studies have linked particulate matter from cars and trucks and carbon monoxide with heart attacks and strokes.

During periods of growth, people have more money to spend on alcohol and cigarettes. And more economic activity means more factory orders, meaning people are working harder and longer and sleeping less.

Still, this is not to say that losing a job is good for your health. The study looks at the bigger picture -- fewer cars, fewer people working overtime, less pollution -- and how it may benefit public health as a whole.

A similar pattern may be at work during the current downturn, the authors suggested.

"My expectation is that mortality rates in 2008 will be lower than in 2007, and probably in 2009 will be lower than 2008," Tapia said. "There is a general improvement, even though suicides are going up."

Joshua Klapow, associate professor at the University of Alabama Birmingham's School of Public Health, said he would be cautious about applying any of the findings to today's recession.

Society has changed significantly in the past 60 to 80 years, he said. Medical advances enable people to live with chronic diseases for much longer nowadays. Infectious diseases, such as tuberculosis, kill fewer people today. Fewer people do manual labor, smoking has declined, and obesity has shot up.

"The only points of similarity are the economic factors," Klapow said. "You can't equate health status, health care, health costs or lifestyles with the 1920s or the 1930s. You have confounding factors right now that prevent us from drawing any reasonable conclusion about our current state."

And during this downturn, studies show that many Americans are making poor health choices, such as cutting back on medications and putting off medical care because of costs.

"We have a lot of indicators during this economic turmoil that the health status of our population is not getting better," Klapow said. "The study is fascinating, but we have to be very careful not to forecast a trajectory to our present day."

[Demeter]

51. Garrison Keillor Did a Riff on this tonight

He pointed out that when times are tough, people can't afford to drink, smoke or drug themselves to death. In fact, said Garrison drily, except for suicide, all causes of death decline.

Of course, it could just be that life SEEMS endless when you are unemployed, homeless and hungry....

[Demeter]

52. Dogbert Decides to Inflate the Economy

http://dilbert.com/dyn_file/str_strip/69230/gif/strip.print/

[Demeter]

53. Regarding Argentina's Economy: America as Argentina?

http://deadcatsbouncing.blogspot.com/2009/10/fs.html

...Argentina's troubled history in recent decades leads many to forget just how prosperous and advanced the country was a century ago; in fact, it was one of the ten richest countries in the world on a per capita basis until the 1930's.

Any analysis of the country's stunning decline into inflation and dictatorship a few decades later must begin with the role of an entrenched economic elite who pursued their narrow interests regardless of the national cost. Rather than investment bankers, Argentina had an elite of a few thousand landowners who equally dominated the economy via agricultural exports. The pursuit of naked self-interest by these 'oligarchs' led to an increasingly unbalanced economy that underinvested in education and infrastructure and was dominated by inefficient monopolies protected by political patrons. That effort to protect the status quo at all costs via a captive political system led to the failure of attempts to modernize the economy and income inequalities growing to a destabilizing extreme.

Effectively Argentina metamorphosed from a productive to a rentier economy, with a small elite redistributing stagnant national wealth to their short-term advantage. Sound even vaguely familiar?

America's strongest remaining economic advantage has been its ability to reallocate capital and talent to the 'new thing', the innovative business models and technologies that can transform broader economic productivity and generate new wealth. That depends on both social mobility and an effective reallocation of capital and people from dying to rising industries, what Austrian economist Joseph Schumpeter termed 'creative destruction'. Regulatory and political capture by entrenched elites runs counter to both, and helps explain the unhealthy domination of the US economy by the finance and healthcare industries over the past decade, whose political lobbying and funding dwarfs any other sector. An economy riven by narrow vested interests seeking to direct public policy and profit from public funds becomes one saddled with perverse economic incentives that undermine the purging and renewal process that is central to capitalism...


The US hasn't generated a trade surplus since the early 1990's recession, all the while since accumulating a mountain of foreign obligations. Now, as aggregate debt approaches 400% of GDP, the necessary deleveraging of the US consumer and financial sector has been postponed by massive government intervention. Total debt for the US financial sector was US$16.5 trillion in the second quarter 2009, almost identical to the level reported a year earlier. The apparent reduction in financial sector leverage (which reached over 30x for several investment banks) is due to a bigger capital base from equity issuance and a transfer of off-balance sheet liabilities into the public sector. The huge shadow banking system, comprising hedge funds and non-financial entities from GM to GE, remains intact if somewhat chastened.

Despite the asset reflation of recent months that has relieved the pressure on bank balance sheets and avoids the need to recognize huge residual losses (of over $1trn globally), regulatory reform has descended into the sad spectacle of posturing over bonus controls, missing the point that it is the obscene profitability of the financial sector (a tax on the wider economy) that drives that huge remuneration relative to other sectors. Until banks become subservient to the wider economy and regulated as the essential utilities they are, the US will continue to suffer a chronic misallocation of capital and talent and inexorable economic decline. Argentina never had the advantage of a global reserve currency, and that certainly postpones the inevitable adjustment, but only for so long.

[Demeter]

54. The Rude Pundit Praising Grayson With Not At All Faint Damns

http://rudepundit.blogspot.com/2009/10/rep.html

Rep. Alan Grayson May Just Fuck Your Shit Up:


It's too soon to tell, but there's a good chance that Representative Alan Grayson, he of the "Die Quickly" Republican health care plan, will end up fucking your shit up. Too rich to be bought off, Grayson's been fucking with the powerful for a few years now. As an attorney, he represented whistleblowers, going after the hundreds of millions of dollars in fraud committed by contractors and others in Iraq. He told CNN in April 2006, "The development fund of Iraq was looted by war profiteers and war whores." Check out the huge ass article on him in Vanity Fair from 2007 (and check out that goatee). He went after Halliburton and KBR; he fucked with Dick Cheney. You think a man whose name is a homophone with "boner" is gonna trouble him?

Look, let's be clear: Grayson of Orlando, Florida, is something of a drama queen. Defeating an incumbent Republican in a previously solidly Republican district as part of the Obama wave in 2008, he's an attack dog straight out of old school progressive politics. Here he is in January on President Obama's stimulus plan: "It shelters the homeless, and it heals the sick. It helps us to look forward to a day when we beat our swords into plowshares, our spears into pruning hooks, and when a nation does not lift up a sword against nation anymore." It's a bit over the top, like his Holocaust remark yesterday and his demand that AIG's CEO "name names" of those who received bonuses.

But sometimes those kinds of dramatics can be absolutely energizing, like the second shot of cheap tequila, as when Grayson said, "Rush Limbaugh is a has-been hypocrite loser, who craves attention. His right-wing lunacy sounds like Mikhail Gorbachev, extolling the virtues of communism. Limbaugh actually was more lucid when he was a drug addict. If America ever did 1% of what he wanted us to do, then we'd all need pain killers."

And this dude knows how to apologize to right-wingers. Pushed by Michael Steele to beg forgiveness from Limbaugh like so many Republicans did, Grayson offered, "I’m sorry Limbaugh called for harsh sentences for drug addicts while he was a drug addict. I’m also sorry that he’s bent on seeing America fail. And I’m sorry that Limbaugh is one sorry excuse for a human being."

Grayson was the member of Congress who authored the grandly symbolic bill attacking executive compensation in the financial firms now owned by all of us, also known as the "Pay for Performance Act," currently somewhere on hold in the Senate after passing the House in April. This would be back when "populist anger" was actually about people against corporations, which, of course, meant conservatives thought it was wrong. Grayson said, "You should not get rich off public money, and you should not get rich off of abject failure...This bill will show which Republicans are so much on the take from the financial services industry that they're willing to actually bless compensation that has no bearing on performance and is excessive and unreasonable. We'll find out who are the people who understand that the public's money needs to be protected, and who are the people who simply want to suck up to their patrons on Wall Street."

The bill caused Fox "news" host Neil Cavuto to lose his shit on the air with Grayson, to the point where Grayson said that Cavuto was conjuring a "paranoid fantasy" about the implications of the bill. Cavuto cursed and spat while Grayson looked like he was wondering if he was going to have to grab Cavuto's jaws to keep him from biting.

Since Grayson said that the Republican plan for health care is "Don't get sick" and "Die quickly," Grayson has become this week's punching bag for conservative wads of fuck who want to equate his words with Rep. Joe "Insert Banjo Music" Wilson's loud "Don't lie" fart during the President's health care speech. Beyond the hypocrisy of the death panel people saying someone's being too mean, it should also be pointed out that Grayson didn't just bray out of nowhere like he was getting fucked by a donkey. He was recognized and speaking in turn. Robert's Rules of Order don't say anything about whether or not a speaker can drip with savage sarcasm.

Yesterday, on The Situation Room with Wolf "Bow Down Before the Sartorial Magnificence of My Beard" Blitzer, the gathered CNN superfriends couldn't comprehend Grayson, as if anger and honesty coming from a Democrat is some unknown species of rhetoric. "They should apologize to America," Grayson said of Republicans calling for him to beg forgiveness. He may as well have said, "Suck my balls."

The best part was when designated Republican Alex "Douche 'Stache" Castellanos asked Grayson which people does the Congressman think he wants to die. Grayson went right back at him, calling Republican ideas "amorphous nonsense," and "Do you really think that tort reform is going to take care of 47 million people?" By the point that Grayson said Republicans were just using the "usual cliches," Castellanos had the look of a straight man who was just shown the cock that was going to fuck him.




It was truly something beautiful because Grayson walked into Wolf Blitzer's house, drank his whiskey, and took a giant shit on CNN's floor. The pundits from Carville to Castellanos to Borger didn't know what the fuck to do with this guy who wasn't going to play by the usual rules of suck up and pander and call for bipartisanship like other Democrats. The closest they've gotten is the occasional Barney Frank appearance, but Grayson is something different, a Democrat who not only has his own balls, but is ripping the nuts off others. "They've been dragging their feet. These -- these are foot dragging, knuckle dragging Neanderthals who think they can dictate policy to America by being stubborn. And I think it's -- the time is over. We had an election. That's it. Now we have to move ahead in just the way the president wants us to," Grayson said, and, oh, the sputtering that happened.

James Carville asked Grayson at the end if he was ready for how his life was going to change. What ought to be happening is that Democrats should be using Grayson as their point person, sending him out to take a wrecking ball to the stick houses of arguments Republicans keep constructing. Republicans have never known how to deal with it when someone fights back with the same brutality they use. Grayson just pointed out that motherfuckers fuck their mothers. It's that simple.

[Joe Chi Minh]

67. I should feel very negative about it, but he has an amazing way with words,

oedipal insights (surprisingly profound on the face of it) and reproductive metaphors.

I reckon an exchange between therudepundit and James Howard Kunstler on the devils behind the economic shenanigans destroying the world would be something of a firework display.

[Demeter]

55. I'm stopping on a positive note here

Tomorrow, I promise, lots more doom and gloom. I just hope Grayson doesn't do a John Edwards.

[Hugin]

59. I've read through this entire thread and there isn't one single atonemint!

:gripe:

Do I have to do everything around here! }(

I guess I'd better make it a double mint to make up for this glaring oversight...

Seltzer & Salt Double mint song

http://www.youtube.com/watch?v=gDB0zMYpZZQ

(Apologies to Warren Buffet)

[Demeter]

61. Oh, there's lots of atonement--by the PTB!

I really doubt that our little group has anything to atone for....at least not on the scale of the Big Guys.

[Hugin]

62. Here's some more double atonemint!

Chris Brown Wrigley Doublemint Commercial

http://www.youtube.com/watch?v=liq0gek8Fpk

& - a parody of the same...

Chris Brown Doublemint Gum Parody

http://www.youtube.com/watch?v=tvtxO6XFEFQ

[Demeter]

63. The Real Reason the Giant, Insolvent Banks Aren’t Being Broken Up

http://www.nakedcapitalism.com/2009/10/guest-post-the-real-reason-the-giant-insolvent-banks-arent-being-broken-up.html

By George Washington of Washington’s Blog.

Why isn’t the government breaking up the giant, insolvent banks?

We Need Them To Help the Economy Recover?

Do we need the Too Big to Fails to help the economy recover?

No.

The following top economists and financial experts believe that the economy cannot recover unless the big, insolvent banks are broken up in an orderly fashion:

* Nobel prize-winning economist, Joseph Stiglitz

* Nobel prize-winning economist, Ed Prescott

* Dean and professor of finance and economics at Columbia Business School, and chairman of the Council of Economic Advisers under President George W. Bush, R. Glenn Hubbard

* MIT economics professor and former IMF chief economist, Simon Johnson (and see this)

* President of the Federal Reserve Bank of Kansas City, Thomas Hoenig (and see this)

* Deputy Treasury Secretary, Neal S. Wolin

* The President of the Independent Community Bankers of America, a Washington-based trade group with about 5,000 members, Camden R. Fine

* The Congressional panel overseeing the bailout

* The head of the FDIC, Sheila Bair

* The leading monetary economist and co-author with Milton Friedman of the leading treatise on the Great Depression, Anna Schwartz

* Economics professor and senior regulator during the S & L crisis, William K. Black

* Economics professor, Nouriel Roubini

* Economist, Marc Faber

* Professor of entrepreneurship and finance at the Chicago Booth School of Business, Luigi Zingales

* Economics professor, Thomas F. Cooley

* Former investment banker, Philip Augar

* Chairman of the Commons Treasury, John McFall

Others, like Nobel prize-winning economist Paul Krugman, think that the giant insolvent banks may need to be temporarily nationalized.

In addition, many top economists and financial experts, including Bank of Israel Governor Stanley Fischer – who was Ben Bernanke’s thesis adviser at MIT – say that – at the very least – the size of the financial giants should be limited.

Even the Bank of International Settlements – the “Central Banks’ Central Bank” – has slammed too big to fail. As summarized by the Financial Times:

The report was particularly scathing in its assessment of governments’ attempts to clean up their banks. “The reluctance of officials to quickly clean up the banks, many of which are now owned in large part by governments, may well delay recovery,” it said, adding that government interventions had ingrained the belief that some banks were too big or too interconnected to fail.

This was dangerous because it reinforced the risks of moral hazard which might lead to an even bigger financial crisis in future.

If We Break ‘Em Up, No One Will Lend?

Do we need to keep the TBTFs to make sure that loans are made?

Nope.

Fortune pointed out in February that smaller banks are stepping in to fill the lending void left by the giant banks’ current hesitancy to make loans. Indeed, the article points out that the only reason that smaller banks haven’t been able to expand and thrive is that the too-big-to-fails have decreased competition:

Growth for the nation’s smaller banks represents a reversal of trends from the last twenty years, when the biggest banks got much bigger and many of the smallest players were gobbled up or driven under…

As big banks struggle to find a way forward and rising loan losses threaten to punish poorly run banks of all sizes, smaller but well capitalized institutions have a long-awaited chance to expand.

BusinessWeek noted in January:

As big banks struggle, community banks are stepping in to offer loans and lines of credit to small business owners…

At a congressional hearing on small business and the economic recovery earlier this month, economist Paul Merski, of the Independent Community Bankers of America, a Washington (D.C.) trade group, told lawmakers that community banks make 20% of all small-business loans, even though they represent only about 12% of all bank assets. Furthermore, he said that about 50% of all small-business loans under $100,000 are made by community banks…

Indeed, for the past two years, small-business lending among community banks has grown at a faster rate than from larger institutions, according to Aite Group, a Boston banking consultancy. “Community banks are quickly taking on more market share not only from the top five banks but from some of the regional banks,” says Christine Barry, Aite’s research director. “They are focusing more attention on small businesses than before. They are seeing revenue opportunities and deploying the right solutions in place to serve these customers.”

And Fed Governor Daniel K. Tarullo said in June:

The importance of traditional financial intermediation services, and hence of the smaller banks that typically specialize in providing those services, tends to increase during times of financial stress. Indeed, the crisis has highlighted the important continuing role of community banks…

For example, while the number of credit unions has declined by 42 percent since 1989, credit union deposits have more than quadrupled, and credit unions have increased their share of national deposits from 4.7 percent to 8.5 percent. In addition, some credit unions have shifted from the traditional membership based on a common interest to membership that encompasses anyone who lives or works within one or more local banking markets. In the last few years, some credit unions have also moved beyond their traditional focus on consumer services to provide services to small businesses, increasing the extent to which they compete with community banks.

Indeed, some very smart people say that the big banks aren’t really focusing as much on the lending business as smaller banks.

Specifically since Glass-Steagall was repealed in 1999, the giant banks have made much of their money in trading assets, securities, derivatives and other speculative bets, the banks’ own paper and securities, and in other money-making activities which have nothing to do with traditional depository functions.

Now that the economy has crashed, the big banks are making very few loans to consumers or small businesses because they still have trillions in bad derivatives gambling debts to pay off, and so they are only loaning to the biggest players and those who don’t really need credit in the first place. See this and this.

So we don’t really need these giant gamblers. We don’t really need JP Morgan, Citi, Bank of America, Goldman Sachs or Morgan Stanley. What we need are dedicated lenders.

The Fortune article discussed above points out that the banking giants are not necessarily more efficient than smaller banks:

The largest banks often don’t show the greatest efficiency. This now seems unsurprising given the deep problems that the biggest institutions have faced over the past year.

“They actually experience diseconomies of scale,” Narter wrote of the biggest banks. “There are so many large autonomous divisions of the bank that the complexity of connecting them overwhelms the advantage of size.”

And Governor Tarullo points out some of the benefits of small community banks over the giant banks:

Many community banks have thrived, in large part because their local presence and personal interactions give them an advantage in meeting the financial needs of many households, small businesses, and agricultural firms. Their business model is based on an important economic explanation of the role of financial intermediaries–to develop and apply expertise that allows a lender to make better judgments about the creditworthiness of potential borrowers than could be made by a potential lender with less information about the borrowers.

A small, but growing, body of research suggests that the financial services provided by large banks are less-than-perfect substitutes for those provided by community banks.

It is simply not true that we need the mega-banks. In fact, as many top economists and financial analysts have said, the “too big to fails” are actually stifling competition from smaller lenders and credit unions, and dragging the entire economy down into a black hole.

The Giant Banks Have Recovered, And Are No Longer Insolvent?

Have the TBTFs recovered, so that they are no longer insolvent?

Negatory.

The giant banks have still not put the toxic assets hidden in their SIVs back on their books.

The tsunamis of commercial real estate, Alt-A, option arm and other loan defaults have not yet hit.

The overhang of derivatives is still looming out there, and still dwarfs the size of the rest of the global economy. Credit default swaps have arguably still not been tamed (see this).

Indeed, Nobel prize winning economist Joseph Stiglitz said recently:

The U.S. has failed to fix the underlying problems of its banking system after the credit crunch and the collapse of Lehman Brothers Holdings Inc.

“In the U.S. and many other countries, the too-big-to-fail banks have become even bigger,” Stiglitz said in an interview today in Paris. “The problems are worse than they were in 2007 before the crisis.”

Stiglitz’s views echo those of former Federal Reserve Chairman Paul Volcker, who has advised President Barack Obama’s administration to curtail the size of banks, and Bank of Israel Governor Stanley Fischer, who suggested last month that governments may want to discourage financial institutions from growing “excessively.”

While the big boys have certainly reported some impressive profits in the last couple of months, some or all of those profits may have been due to “creative accounting”, such as Goldman “skipping” December 2008, suspension of mark-to-market (which may or may not be a good thing), and assistance from the government.

Some very smart people say that the big banks – even after many billions in bailouts and other government help – have still not repaired their balance sheets. Tyler Durden, Reggie Middleton, Mish and others have looked at the balance sheets of the big boys much more recently than I have, and have more details than I do.

But the bottom line is this: If the banks are no longer insolvent, they should prove it. If they can’t prove they are solvent, they should be broken up.

The Government Lacks the Power to Break Them Up?

Does the government lack the power to break up the TBTFs?

Wrong.

One of the world’s leading economic historians – Niall Ferguson – argues in a current article in Newsweek:

there should be a new “resolution authority” for the swift closing down of big banks that fail. But such an authority already exists and was used when Continental Illinois failed in 1984.

Indeed, even the FDIC mentions Continental Illinois in the same breadth as “too big to fail” banks.

And William K. Black (remember, he was the senior regulator during the S&L crisis, and is a Professor of both Economics and Law) – says that the Prompt Corrective Action Law (PCA), 12 U.S.C. § 1831o, not only authorizes the government to seize insolvent banks, it mandates it, and that the Bush and Obama administrations broke the law by refusing to close insolvent banks.

Whether or not the banks’ holding companies can be broken up using the PCA, the banks themselves could be. See this.

And no one can doubt that the government could find a way to break up even the holdign companies if it wanted.

FDR seized gold during the Great Depression under the Trading With The Enemies Act.

Geithner and Bernanke have been using one loophole and “creative” legal interpretation after another to rationalize their various multi-trillion dollar programs in the face of opposition from the public and Congress (see this, for example).

And the government could use 100-year old antitrust laws to break them up.

So don’t give me any of this “our hands are tied” malarkey. The Obama administration could break the “too bigs” up in a heartbeat if it wanted to, and then justify it after the fact using PCA or another legal argument.

Is Temporarily Nationalizing the Giant Banks Socialism?

Many argue that it would be wrong for the government to break up the banks, because we would have to take over the banks in order to break them up.

That may be true. But government regulators in the U.S., Sweden and other countries which have broken up insolvent banks say that the government only has to take over banks for around 6 months before breaking them up.

In contrast, the Bush and Obama administrations’ actions mean that the government is becoming the majority shareholder in the financial giants more or less permanently. That is – truly – socialism.

Breaking them up and selling off the parts to the highest bidder efficiently and in an orderly fashion would get us back to a semblance of free market capitalism much quicker.

The Real Reason the Giant Banks Aren’t Being Broken Up

So what is the real reason that the TBTFs aren’t being broken up?

Certainly, there is regulatory capture, cowardice and corruption:

* Joseph Stiglitz (the Nobel prize winning economist) said recently that the U.S. government is wary of challenging the financial industry because it is politically difficult, and that he hopes the Group of 20 leaders will cajole the U.S. into tougher action

* Economic historian Niall Ferguson asks:

Guess which institutions are among the biggest lobbyists and campaign-finance contributors? Surprise! None other than the TBTFs .

* Manhattan Institute senior fellow Nicole Gelinas agrees:

The too-big-to-fail financial industry has been good to elected officials and former elected officials of both parties over its 25-year life span

* Investment analyst and financial writer Yves Smith says:

Major financial players control over the all-important over-the-counter debt markets…It is pretty hard to regulate someone who has a knife at your throat.

* William K. Black says:

There has been no honest examination of the crisis because it would embarrass C.E.O.s and politicians . . .
Instead, the Treasury and the Fed are urging us not to examine the crisis and to believe that all will soon be well. There have been no prosecutions of the chief executives of the large nonprime lenders that would expose the “epidemic” of fraudulent mortgage lending that drove the crisis. There has been no accountability…

The Obama administration and Fed Chairman Ben Bernanke have refused to investigate the nature and causes of the crisis. And the administration selected Timothy Geithner, who with then Treasury Secretary Paulson bungled the bailout of A.I.G. and other favored “too big to fail” institutions, to head up Treasury.

Now Lawrence Summers, head of the White House National Economic Council, and Mr. Geithner argue that no fundamental change in finance is needed. They want to recreate a secondary market in the subprime mortgages that caused trillions of dollars of losses.

Traditional neo-classical economic theory, particularly “modern finance theory,” has been proven false but economists have failed to replace it. No fundamental reform can be passed when the proponents are pretending that there really is no crisis or need for change.

* Harvard professor of government Jeffry A. Frieden says:

Regulatory agencies are often sympathetic to the industries they regulate. This pattern is so well known among scholars that it has a name: “regulatory capture.” This effect can be due to the political influence of the industry on its regulators; or to the fact that the regulators spend so much time with their charges that they come to accept their world view; or to the prospect of lucrative private-sector jobs when regulators retire or resign.

* Economic consultant Edward Harrison agrees:Regulating Wall Street has become difficult in large part because of regulatory capture.

But there is an even more interesting reason . . .

The number one reason the TBTF’s aren’t being broken up is . . . the ‘ole 80’s playbook is being used.

As the New York Times wrote in February:

In the 1980s, during the height of the Latin American debt crisis, the total risk to the nine money-center banks in New York was estimated at more than three times the capital of those banks. The regulators, analysts say, did not force the banks to value those loans at the fire-sale prices of the moment, helping to avert a disaster in the banking system.

In other words, the nine biggest banks were all insolvent in the 1980s.

And the Times is not alone in stating this fact. For example, Felix Salmon wrote in January:

In the early 1980s, when a slew of overindebted Latin governments defaulted to their bank creditors, a lot of big global banks, Citicorp foremost among them, became insolvent.

So the government’s failure to break up the insolvent giants – even though virtually all independent experts say that is the only way to save the economy, and even though there is no good reason not to break them up – is nothing new.

William K. Black’s statement that the government’s entire strategy now – as in the S&L crisis – is to cover up how bad things are (”the entire strategy is to keep people from getting the facts”) makes a lot more sense.

[Demeter]

66. AND THAT'S WHERE THE ATONEMENT HAS GOT TO COME FROM

[snot]

73. Great article (and it even provides sources!)

[Hugin]

68. Here's my personal atonement.

I was ciphering and cogitating on my deluxe TopsyTurvy(tm) Tomato Planting System... Y'know, doing a little Cost/Benefit calculating...

One TopsyTurvy(tm) Device... $10.00 (American)
One bag of top quality planting soil... $10.00 (American)
90 gallons of fresh water and misc. (plant food etc.)... $5.00 (American)
Two Beefeater Variety Tomato Plants... $4.00 (American)

For a grand total of... (If you discount my labor, which is priceless. ;) ): $29.00 (American)

With a burgeoning harvest during the season of... 18 Tomatoes.

That makes it... Using, The Math... $29.00/18 Tomatos... $1.61/Tomato. :blush:

But... But... But... They were BETTER than store bought! Really!

:yoiks:

[Demeter]

69. You Have to Average Your Caipital Expenditures Over More Than One Season

and of course, they tasted better. You can't argue cost against quality.

[Hugin]

71. I didn't see the blurb about amortization in the instructions.

However, that point is moot as the bottom (uh, or is that top? :crazy: ) of the TopsyTurvy(tm) mechanism disintegrated as I was pulling the root bulb out as was called for in the instructions. :/

Forcing me to reinvest the $10.00 equipment charge again next year...

I'm telling you... The life of a farmer! This year, I dealt with floods, drought, wind, frost, and pestilence! (A big fat tomato bug got my last tomato! :yick: )



But! Never deterred! Next year, I will plant earlier and grow from seeds! (Saving the $4.00 I foolishly squandered on pre-sprouted plants! :think: )

[mbperrin]

88. Plant marigolds or chrysanthemums with your tomatoes, and you'll

never see another tomato bug.

I'd have to check to see which phase of the moon is best for planting, however...

[Hugin]

89. Sage wisdom.

Come to think of it... I've used a chrysanthemum spray on my roses.

Hmm... Maybe I should put in some winter wheat! :)

[DemReadingDU]

72. There is nothing better than a fresh tomato

I refuse to buy those things in the winter at the grocery.


Just got back from my sister bonding weekend, at Nashville, Ind. My 30-something daughter came too...she calls it the 'aunty-campout'. Perhaps it is the anti-campout as we had a camper/trailer with electric, including a microwave, and hot water.
:)


The economy was not on the agenda. Much to catch up on.

[Hugin]

74. Glad to hear you had a good outing.

:)

Yep, they've been busy as always.

[Demeter]

80. The Only Way I'll Ever Go Camping Is With Hot Running Water

and a tub to soak in.

[DemReadingDU]

86. and heat!

It was darn chilly and frosty this weekend.
Thankfully, the camper had heat too
:)

[mbperrin]

87. Actually, organic tomatoes are $4.99 per pound, so you did great!

http://www.organicdirect.com/organic-tomatoes-price-p-468.html

AND they do taste great, too!

Next year, add one bucket of pole beans. Produce like crazy, make a little cornbread, fresh sliced tomatoes, beans, absolutely great!

I suppose my lack of millionaire upbringing has now been exposed. ;)

[Po_d Mainiac]

92. Hanging pots

Made from junk slabs $0 (22 made)
8 screws per pot $0.16
Potting soil scraped out of forest duff $0 (my Yankee woodlot)
Plants started from seed $.05 ea
40 hours of time that I had nothing useful to do anyway $?

4+ gals of puree (cooked outside using more junk slabs for fuel)

I can't finish this, using the line from Craphole 1 commercial...U do the math:bounce:

[snot]

75. I think you'd all enjoy this if you haven't seen it

(just came across it via another DU post): Rep. Alan Grayson grilling Federal Reserve General Counsel Scott Alvarez about such suspected Fed activities as manipulating the stock and gold markets:

http://www.youtube.com/watch?v=mXmNpdYpfnk

Grayson's smiling like the Cheshire cat.

[Hugin]

76. Good stuff!

... and, I like Grayson's tie, to boot. :thumbsup:

[Demeter]

81. Wow!

Like a cat with a mouse, more like. I could really get to like this guy.

[Demeter]

82. TARP Anniversary: By The Numbers

http://www.huffingtonpost.com/2009/10/02/tarp-anniversary-by-the-n_n_307643.html

In recognition of TARP's one-year anniversary, we're putting up some quick numbers for the HuffPost community to digest.

The Emergency Economic Stabilization Act of 2008 -- the law that authorized the federal government to dole out $700 billion in taxpayer funds to banks, the auto industry and troubled insurer AIG -- was passed by Congress, signed by former President George W. Bush, and went into effect on Oct. 3, 2008.

Congress originally intended the money to be used to buy and insure troubled bank assets, like delinquent home mortgages. But over time, the Troubled Asset Relief Program took on another, broader mission: To pump massive amounts of money into companies to prevent them from collapsing in the face of future losses.

Beneficiaries have included banks (like Citigroup and Bank of America), auto manufacturers (like General Motors and Chrysler), and mortgage servicers (like PennyMac Loan Services and Countrywide Home Loans Servicing).

The following is a breakdown of where the money has gone, where it hasn't, and what taxpayers have found themselves on the hook for in the year since Bush told the nation, at 2:03pm ET on Friday, Oct. 3, 2008, that the bill had just cleared Congress, and that he was going to sign it into law.

* $573.3 Billion -- Total amount announced and/or distributed

* $72.8 Billion -- Amount returned to taxpayers

* 12 -- Number of programs

* 755 -- Number of recip

* 655 -- Number of recipients that have yet to return bailout funds

* 40 -- Recipients that have fully repaid taxpayers

* $389.6 Billion -- Total amount outstanding (does not include announced funds that have yet to be distributed)

* $14.4 Billion -- Revenue for government from investments (dividends, interest and stock warrants)

* 60 -- Mortgage servicers getting taxpayer-provided incentives to modify home mortgage loans

* $22.3 Billion -- Amount provided to mortgage servicers to induce mortgage modifications

* 2,965,980 -- Estimated number of eligible mortgages under program

* 360,165 -- Number of trial modifications started

* 12.1 Percent -- Share of eligible mortgages that have been modified

* 83 -- Number of TARP recipients in California (leads the nation)

* 0 -- Number of TARP recipients in Montana and Vermont (the only states without TARP recipients)

* $23.7 Trillion -- A worst-case scenario figure for the amount of money taxpayers could be forced to cough up if every program, in essence, fails. This eye-popping number should be taken with a grain of salt. For more, please read the following analysis from The New York Times's Floyd Norris.


Note: The figures were compiled from the following sources, using the most recent information available: U.S. Treasury Department, ProPublica, Office of the Special Inspector General for the Troubled Asset Relief Program


Read more at: http://www.huffingtonpost.com/2009/10/02/tarp-anniversary-by-the-n_n_307643.html

[Demeter]

83. 1,000 Companies Attacked -> 1,200,000 Jobs Destroyed

by vets74

http://www.dailykos.com/story/2009/10/2/789055/-1,000-Companies-Attacked1,200,000-Jobs-Destroyed

Bloomberg got an Emmy nomination in 2007 for explaining the mechanics of these "hedge fund" attacks. Vid is at link. "Phantom Stock" runs 25:10.

The damage is primary jobs. Permanent jobs with companies that make products or provide specialized services. The likes of bio-tech, finance and engineering, and computer systems.

Criminal attacks combine corrupt MSM lie campaigns with market dumps of "naked shorts" and counterfeit "phantom stock."

-- Depress stock prices --> Make millions on short-side options.

-- Do a lot of it and laugh at S.E.C.

Statistical sampling and employment data for the largest 1,000 attacked companies show they suffered 1,200,000 extra/excess layoffs.

Throw on a macroeconomic multiplier effect... this gets past 3,000,000 jobs dropped overall.

RICO-eligible criminal enterprises out of "hedge funds" and CNBC and TheStreet.com and financial MSM and paid phony bloggers (e.g., Tom Sykes, a pseudonym for Gary Weiss, at DKOS) -- may have screwed up America as much as the credit crunch.


*************************

First off: the first of the DKOS community to hammer this nail was the wonderful KathrynW in her diary The Financial Terrorists of Wall Street - The Truth Behind a Curtain of Silence.

KathrynW posted this diary back Sun Mar 15, 2009 at 01:14:30 PM EDT. She got all of 23 RECs and 13 Tips. Not a chance at the RECOMMEND hotlist.

Her interest in these Phantom_stock/Naked_short_selling schemes had been spurred by what happened to Force Protection, Inc. She imbedded this link:

We had another interest in Force Protection. This South Carolina firm had developed the MRAP vehicles to protect American soldier and Marines in Iraq from the roadside bombs called I.E.D.'s. This financial system attack on FP contributed to the subsequent delayed deployment of the MRAPs. Damage had a secondary effect: absence of the MRAP vehicles killed and maimed any number of service personnel. Our troops had to conitnue using the HUMVEE jeeps against the road side bombs (called I.E.D.s), making up 70% of our Iraq casualty experience.

*****

At this point, let's take a moment to clarify details that explain how stock ownership is transferred. Then, correct two misapprehensions you could pick up from the Bloomberg video:

-- That these Failure To Deliver events could be a bookkeeping error.

-- Also, that FTD's affect only "1.5%" of the "physical" brokerage-to-brokerage stock transfers.

FTD's are not bookkeeping and they were running at 37% of "physical" transfers during the recent attack months.

You can also get a fanciful idea from press releases that SEC actively regulates these systems. No-no-no. Never ever happens. Here are the players:

-- Depository Trust Company, is the central stock depository and member of the Federal Reserve System. DTC acts as a custodian for the majority of securities issues. DTC is a subsidiary of DTCC.

-- Depository Trust and Clearing Corporation (DTCC) is the counterparty
for U.S. exchanges and markets for equities, bonds, U.S. Government treasuries, and other securities. DTCC manages the clearance and settlement system for U.S. equities through another subsidiary, the National Securities Clearing Corporation (NSCC).

-- NSCC provides settlement instructions to customers
and participant firms.

-- From John Welborn:

Though part of the Federal Reserve System, the dtcc is collectively owned and operated by the large U.S. brokerages. As a result, DTCC operations are technically overseen by the sec. In fact, the dtcc operates with minimal sec oversight. Until recently, the size of past (but not current) ftds in given equity issues could only be obtained through petition to the SEC’s Freedom of Information Act office, which must request the information, in turn, from the dtcc. This process took months and resulted in the release of stale market data. The SEC recently made available for Internet download limited ftddata for all securities listed on U.S. equity markets. As this article goes to print, however, only FTD data from the previous fiscal quarter are available (starting with August 2007). The DTCC claims to support limited disclosure of FTD data, but no additional data have been disclosed beyond that offered by the SEC.

To this extent, the Bloomberg piece is optimistic.

-- Further, the actual percentage of physical deliveries affected by FTD's puts paid to the notion that these could be "bookkeeping" errors.

The Continuous Net Settlement (CNS) system, operated by the NSCC. The CNS constantly nets stock trades among brokerdealer accounts at DTC. CNS allows trades to settle promptly and efficiently. According to Sirri, CNS
"steps in between two parties to a trade and nets each party’s obligation to trade over multiple trades, so that each obligation to receive or deliver, and an obligation to deliver or receive, can be combined together into one." Remaining trades -- requiring actual delivery in terms of moving a stock from one DTC account to another, not netting out from internal accounts -- these remaining trades constitute the whole of actual stock "delivery."

When DTCC processes $400 billion in trades daily as claimed, then $384 billion are netted out and only $16 billion require < brokerdealer-to-brokerdealer > delivery. In a 2005 letter to the DTCC, Robert Shapiro, former Undersecretary of Commerce for Economics, observed that the $6 billion in FTDs that exist on any given day is 37.5 percent of the $16 billion in trades that require delivery.

"25 times the 1.5 percent of deliveries reported by the DTCC."

-- Gary Matsumoto's Bloomberg vid quotes the "1.5%" figure for Failure-To-Deliver events as of 2007 and mislabels it. Nobody is perfect.

Then there's the Matt Taibbi work on naked short selling. This is adjunct to his political take on the Goldman, Sachs juggernaut.

bobswern gets it going with Taibbi's Naked-Shorting Rage: Goldman's Lobbying, SEC's Fail.

Bob also gives a pointer to Time Bomb by John Cassidy, in the New Yorker, July 5th, 1999.

My jump-in is More Taibbi, Wall Street Counterfeiting, Naked Short Attacks, Goldman, Mafia & Cramer.

Connecting the phantom_stock/naked_short/failure-to-deliver events to damaging companies takes a bit of work. About a full day using SAS/ETS and econometric databases. We are set up for this type of analysis.

Not sure that anyone else, anywhere, had done the employment effects analysis ??? This series of conspiratorial/organized crimes -- damaging more than a thousand companies -- seems to have done much more damage than the Bernie Madoff scheme. Apparently the usual analysts have forgotten the overall society.

SEC seems to be a part of the problem, an active enabler with co-conspirators in-house. Ron Reagan and his "Government is the problem" got part of this one right. SEC "experts" arrange second careers for themselves at the hedge funds -- $1,000,000 a year =EQ= temptation.

My recommendation is that Department of Justice (DOJ) use the RICO statute to take over SEC. Similar to the 1984 takeover of the Key West Police Department.

"Key West" the SEC !!

************

Understanding these criminal schemes is simple enough. Bet that the home team loses. Then knee-cap the star pitcher.

Similar to a Tonya Harding, allowed to bet against her Nancy Kerrigan.

But all of this remains in the scope of microeconomics. It is retail. It is one company at a time.

One scheme, one ad hoc conspiracy. One damaged company.

-- One Jim Cramer mad assault on a bio-tech company such as Dendreon and its anti-cancer drug Provenge.

-- One mad hedge fund onslaught that throws out ten times as much counterfeit Overstock.com stock as had been issued by the company.

One at a time.

***************

"Hedge fund" seems, as well, to be a misnomer for these companies. These guys have not been "hedging" risk in a normal, economically sensible definition. What they have been doing is using the "hedge fund" business model as a cover for criminalization. They have been running organized, multi-party criminalized "bear raids" on these many hundreds of American companies.

Furthermore, the "phantom stock"/"naked short selling" financial instruments -- fraudulently minted versions of what were once called "shares" or "stocks" -- are nothing but counterfeiting as it has been treated in other contexts by our National Threat Assessment Center and the Secret Service.

Within our Department of Justice, the traditional response to such patterns of crime has been to establish an Organized Crime Strike Force. Then investigate and go after the crooks. This mechanism appears to me to be the best available option to maintain Rule of Law, as opposed to laissez faire, barbaric thugocracy.

*************

To understand what it means for society, beyond the ones, you have to build a database. You have to add it all up.

The key is to find out which companies are under attack from hedge funds. Specifically, from the RICO Class hedge funds that generate "phantom stock" to soak up buy orders.

SEC does provide this information, unintentionally. For example:

Symbol Security
XXX Description

------ --------------------------

ABH AbitibiBowater Inc
ACF AmeriCredit Corp.
AFN Alesco Financial Inc.
AHR Anthracite Capital, Inc.
ALJ Alon USA Energy, Inc.
ALY Allis-Chalmers Energy Inc.
BHS Brookfield Homes Corporation
BLG Building Materials Holding Corporation
BQR BlackRock EcoSolutions Investment Trust
BZH Beazer Homes USA, Inc.
CAB Cabela's Incorporated
CCC Calgon Carbon Corporation
CIA Citizens, Inc.
CLS Celestica Inc.
CMG Chipotle Mexican Grill, Inc.
CPL CPFL Energia S.A.
CPX Complete Production Services, Inc.
CRZ Crystal River Capital, Inc.
CT Capital Trust, Inc.
CUZ Cousins Properties Incorporated
DB Deutsche Bank Aktiengesellschaft
DFR Deerfield Capital Corp.
DSL Downey Financial Corp.
DSX Diana Shipping Inc.
ETH Ethan Allen Interiors Inc.
EXM Excel Maritime Carriers Ltd.
FED Firstfed Financial Corp.
FLE Fleetwood Enterprises, Inc.
FNB F.N.B. Corporation
FRO Frontline Ltd.
FTK Flotek Industries, Inc.
GBX The Greenbrier Companies, Inc.
GGC Georgia Gulf Corporation
GHL Greenhill & Co., Inc.
GMR General Maritime Corporation
GNK Genco Shipping & Trading Limited
HOV Hovnanian Enterprises, Inc.
HRZ Horizon Lines, Inc.
HTE Harvest Energy Trust
ICO International Coal Group, Inc.
IHP IHOP Corp.
IMB Indymac Bancorp, Inc.
IVN Ivanhoe Mines Ltd.
JRT JER Investors Trust Inc.
KBW KBW, Inc.
KNX Knight Transportation, Inc.
LDK LDK Solar Co., Ltd.
LEE Lee Enterprises, Incorporated
LFC China Life Insurance Company Limited
LPL LG Display Co., Ltd.
LTM Life Time Fitness, Inc.
LXPPR C Lexington Realty Trust
LZB La-Z-Boy Incorporated
MAD Madeco S.A.
MEG Media General, Inc.
MMR McMoRan Exploration Co.
MNI The McClatchy Company
MNT Mentor Corporation
MTH Meritage Homes Corporation
MWA Mueller Water Products, Inc.
NAT Nordic American Tanker Shipping Limited
NCT Newcastle Investment Corp.
NFP National Financial Partners Corp.
NIS NIS Group Co., Ltd.
NLS Nautilus, Inc.
O Realty Income Corporation
PFB PFF Bancorp, Inc.
PFO Flaherty & Crumrine Preferred Income Opportunity Fund Incorporated
PII Polaris Industries Inc.
PRS Primus Guaranty, Ltd.
RAS RAIT Financial Trust
RSO Resource Capital Corp.
RWT Redwood Trust, Inc.
SIX Six Flags Inc.
SOL ReneSola Ltd
SPF Standard Pacific Corp.
SSD Simpson Manufacturing Co., Inc.
TC Thompson Creek Metals Company Inc.
TIA Telecom Italia S.p.A.
TLB The Talbots, Inc.
TMA Thornburg Mortgage, Inc.
TNK Teekay Tankers Ltd.
TPX Tempur-Pedic International Inc.
TR Tootsie Roll Industries, Inc.
TRI Thomson Reuters Corporation
TWP Trex Company, Inc.
UA Under Armour, Inc.
VMW VMware, Inc.
VSE VeraSun Energy Corporation
WAL Western Alliance Bancorporation
WBPR S Wachovia Corporation
WCI WCI Communities, Inc.
WES Western Gas Partners, LP
WGO Winnebago Industries, Inc.
WHX Whiting USA Trust I
WNR Western Refining, Inc.
WSM Williams-Sonoma, Inc.
XRM Xerium Technologies, Inc.

This is a daily list for FTD's. I managed to ask around and beg up copies going back to days when an interested party had to file a Freedom of Information Request to get these lists.

When a company has been on these lists for more than a week at a time, you know right off that its not "bookkeeping."

What stand out, right off, is that the hedge funds target specialty production companies. Standalones. Medium scale operations with growth potential.

Likely undercapitalized, compared to any multinational.

Easy pickings for tactics that induce volatility.

Not likely bestowed with political chops.

********************

Then you want to get realistic. Filter out for companies that went bust for known reasons. If there was an ENRON on the list, it would go off in a trice.

Filter out for extremes. Take the middle four standard deviations.

SAS PC works just fine. A spreadsheet would work, too, but the econometric data is available up to date through 2008 for SAS as a single file. The employment data/company_estimates are gettable for either one. (ASCII = glue.)

Then you compare with companies in matched sectors with similar profitability.

VMWare gets matched within software producers.

How do attacked companies do, compared to similar companies that are not attacked ?

And what happens to employment when a company's access to capital is shut down ?

**********************

Results turned out nasty.

For the largest 1,000 firms under FTD/NSS attack -- with associated media lying going on -- the drop in expected employment went to 1,200 jobs per enterprise.

What I've thrown out is a morning of data acquisition followed by an afternoon of pruning and time series programming. Not the first time I've done that and gotten useful results.

More likely, a half-dozen Masters theses for data collection and a Dissertation for the modeling -- that's more like it for professional academic calculation.

But 1,200,000 jobs destroyed -- that's real stuff.

***********************

These hedge fund thieves are damaging America's innovative, growth-intensive companies.

The macroeconomic multiplier effect is simple enough to define. An initial amount of spending is respent, then again and again. Over time, a whole job of spending produces a similar number of other jobs.

General economic activity -- a generic job -- looks to generate other jobs.

In the time period where phantom stock/FTD/NSS scams have exploded, we're looking at a minimum of 3,000,000 total lost jobs.

(I'm assuming a bleed, where other jobs substitute for the original jobs. The 3,000,000 figure assumes that workers find employment steadily within a 2 year period.)

The great stock market decline of 2008 will fade, eventually. These hedge funds are most destructive when there is a general downturn. In good times, relatively, they focus on fewer target companies, destroy fewer jobs.

3,000,000 people will get jobs. Somewhere.

USDOL sees six unemployed job seekers for every one permanent job opening. Finding a job is not easy. And if you take a short job, a quickie contract, you can lose your unemployment benefits. (True !)

Having an extra 3,000,000 people unemployed, today, is not helping the situation.

The credit crunch caused a recession. All out attacks on 1,000 major American businesses made it the worst economic decline since the Great Depression.

"Key West" the SEC ??? Why not?

Gee. Amazing that an arcane piece of econometric analysis got to the REC LIST and then stayed up overnight.

A whole lot of youse guys hit that RECOMMEND button.

I'd expected that bobswern would have to rewrite it to English, before people could read it. ............. ;^)

[Hugin]

91. Excellent piece.

Very relevant to me, personally.

[Demeter]

84. Well, Ladies and Gentlemen, It Looks Like There's a LOT to Atone For!

So let's hold their feet to the fire! Have a spiffy week, or at least survive so that we may all meet up here again NEXT weekend for a Leif Ericson Special! Maybe we'll even mention that Italian dude who sailed for Spain...

Some day I must learn how to touch-type accurately in the dark. Spelling, too.

[Hugin]

90. Aw, I was hoping for an "Idocracy" weekend.

We must cover this important doc-u-drama! Before it's too late!

[hamerfan]

94. Thanks!

To everyone posting here for their hard work in finding the important articles/stuff this weekend. Lots of very good reading, as usual! See ya all tomorrow on the SMW!
:hi:
hamerfan