Weekend Economists at the End of the Galaxy November 5-7, 2010

[Demeter]

Well, here's another fine mess we've gotten into....

I know some say that "The Gods Must Be Crazy" would epitomize the week we just survived (I hope we all survived. At least, everyone has checked in...Bueller?)

But that was a clear-cut story of the interface between cultures and technologies and fundamental ways of life. And there's no music involved.

I think that a story in which a bureacracy wipes out the Earth for an intergalactic interchange in the first chapter is so much more appropriate, don't you? And the Brits have such a quirky form of black humor that they can make you laugh while you are crying or screaming or otherwise emoting.

So here it is:





http://www.youtube.com/watch?v=MbGNcoB2Y4I

[Tansy_Gold]

1. First Rec! First Rec!

Now that I got it posted, I can actually write something! :evilgrin:

It's been 30 years since I read Hitchhiker and I remember almost nothing about it, except thanks for all the fish and something about infinite improbabilities???

But given the havoc wreaked by Tuesday's elections and the news today that Keith Olbermann has been (temporarily??) sacked by the honcho at MSNBC, I think we need to recognize once again that expecting THEM to do what's right and fair is a waste of effort. They do not care. Phil Griffin doesn't care. Rupert Murdoch doesn't care. Lou Dobbs doesn't care. They don't care. They don't care. They don't care.

Imagine you are playing a Little League(r) baseball game. The rules are laid down ahead of time, so you show up at the diamond with your regulation equipment. All your players meet the requirements for age limits, etc. Then the other team shows up and they have twice as many players, they're all much older and more experienced, they have bigger bats than are allowed by the rule book. As they take the field for your team to bat first, they have eight outfielders and six infielders. After two strikes, your first batter is called out. Your second batter clearly beats the throw to first, but the first baseman and the other team's coach protest the call so loudly that it is reversed. Two outs, and your side is done.

Say what?

But you dutifully take the field only to be told you may only have two outfielders and either a shortstop or a second baseman but not both. The opposing team gets six strikes per batter, and strikes are only called if the batter actually swings and misses. If they don't swing, it's a ball. Three balls, take your base. And they get nine outs per inning.

But you don't protest. You play according to the rules even though they aren't and have no intention of doing so.

And then you wonder why you lost.




Tansy Gold, thanks for all the fish

[Demeter]

3. Welcome Aboard, TG! and Congrats!

[Demeter]

2. 2 BANKS DOWN SO FAR (7:45)

Western Commercial Bank, Woodland Hills, California, was closed today by the California Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with First California Bank, Westlake Village, California, to assume all of the deposits of Western Commercial Bank.

The sole branch of Western Commercial Bank will reopen on Monday as a branch of First California Bank...As of September 30, 2010, Western Commercial Bank had approximately $98.6 million in total assets and $101.1 million in total deposits. First California Bank will pay the FDIC a premium of 0.5 percent to assume all of the deposits of Western Commercial Bank. In addition to assuming all of the deposits of the failed bank, First California Bank agreed to purchase essentially all of the assets.

The FDIC and First California Bank entered into a loss-share transaction on $83.9 million of Western Commercial Bank's assets...The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $25.2 million. Compared to other alternatives, First California Bank's acquisition was the least costly resolution for the FDIC's DIF. Western Commercial Bank is the 141st FDIC-insured institution to fail in the nation this year, and the eleventh in California. The last FDIC-insured institution closed in the state was Los Padres Bank, Solvang, on August 20, 2010.

K Bank, Randallstown, Maryland, was closed today by the Maryland Office of Financial 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 Manufacturers and Traders Trust Company (M&T Bank), Buffalo, New York, to assume all of the deposits of K Bank, except certain brokered deposits. Brokered deposit customers should contact their brokers directly about the status of their accounts.

The seven branches of K Bank will reopen on Saturday as branches of M&T Bank...As of September 30, 2010, K Bank had approximately $538.3 million in total assets and $500.1 million in total deposits. M&T Bank did not pay the FDIC a premium for the deposits of K Bank. In addition to assuming all of the deposits of the failed bank, M&T Bank agreed to purchase approximately $410.8 million of the failed bank's assets. The FDIC will retain the balance of the assets for later disposition.

The FDIC and M&T Bank entered into a loss-share transaction on $289.0 million of K Bank's assets...The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $198.4 million. Compared to other alternatives, M&T Bank's acquisition was the least costly resolution for the FDIC's DIF. K Bank is the 140th FDIC-insured institution to fail in the nation this year, and the fourth in Maryland.

[Demeter]

24. ANOTHER BANK FAILS

Pierce Commercial Bank, Tacoma, Washington, was closed today by the Washington Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Heritage Bank, Olympia, Washington, to assume all of the deposits of Pierce Commercial Bank.

The sole branch of Pierce Commercial Bank will reopen on Monday as a branch of Heritage Bank...As of September 30, 2010, Pierce Commercial Bank had approximately $221.1 million in total assets and $193.5 million in total deposits. Heritage Bank will pay the FDIC a premium of 1.0 percent to assume all of the deposits of Pierce Commercial Bank. In addition to assuming all of the deposits of the failed bank, Heritage Bank agreed to purchase essentially all of the assets...

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $21.3 million. Compared to other alternatives, Heritage Bank's acquisition was the least costly resolution for the FDIC's DIF. Pierce Commercial Bank is the 142nd FDIC-insured institution to fail in the nation this year, and the eleventh in Washington. The last FDIC-insured institution closed in the state was Shoreline Bank, Shoreline, on October 1, 2010.

[Demeter]

46. A FOURTH, BOUTIQUE BANK, MAKES HISTORY

First Vietnamese American Bank, Westminster, California, was closed today by the California Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Grandpoint Bank, Los Angeles, California, to assume all of the deposits of First Vietnamese American Bank.

The sole branch of First Vietnamese American Bank will reopen on Saturday as a branch of Grandpoint Bank...As of September 30, 2010, First Vietnamese American Bank had approximately $48.0 million in total assets and $47.0 million in total deposits. Grandpoint Bank did not pay the FDIC a premium for the deposits of First Vietnamese American Bank. In addition to assuming all of the deposits of the failed bank, Grandpoint Bank agreed to purchase essentially all of the assets...

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $9.6 million. Compared to other alternatives, Grandpoint Bank's acquisition was the least costly resolution for the FDIC's DIF. First Vietnamese American Bank is the 143rd FDIC-insured institution to fail in the nation this year, and the twelfth in California. The last FDIC-insured institution closed in the state was Western Commercial Bank, Woodland Hills, earlier today.

[Demeter]

48. TOTAL ESTIMATED LOSS FOR THE NIGHT: $254.5 M

[Viva_La_Revolution]

94. US Banks Falling at fastest pace in 2 decades..

WASHINGTON -- Regulators shut down four more banks Friday, bringing the 2010 total to 143, topping the 140 shuttered last year and the most in a year since the savings-and-loan crisis two decades ago.
http://www.huffingtonpost.com/2010/11/06/us-banks-failing-at-faste_n_779941.html

[Demeter]

47. EVER WONDER IF FDIC HOLDS A YARD SALE?

http://www.fdic.gov/buying/

[Demeter]

87. Bank Failures in Slow Motion By Douglas French

http://dailyreckoning.com/bank-failures-in-slow-motion/

Every Friday evening a few more banks are closed – seized by the various state banking regulators and handed over to the Federal Deposit Insurance Corporation (FDIC) for liquidation. This all happens rather quietly, barely making the news. We’re told these bank failures are no big deal. No reason to panic. The names of the banks change over the weekend and many customers don’t notice the difference.

We’ve only had 294 failures this cycle, but it is a big deal: adjusted to current dollars, the Depression banking crisis was $100 billion, the S&L crisis was $923 billion, and the current crisis is nearly $8 trillion.

So while FDIC chairwoman Sheila Bair said the current crisis would be “nothing compared with previous cycles, such as the savings-and-loan days,” it’s actually much bigger, because the financial sector had grown to be nearly half the economy by 2006 – as measured by the earnings of the S&P 500.

But the question is; why haven’t there been more bank failures? In 2008, there were 25 failures, last year there were 140, and so far this year 129 have been seized on Friday nights. The greatest real-estate bubble in history has popped – first residential and now commercial – and we only have 294 failures?
.............

And bankers must figure the coast is clear: they are cutting their provisions for bad debts. Yes, at a time when one out of four Americans has a sub-600 FICO score, a quarter of all homeowners are underwater on their mortgages, and commercial real estate is hitting the ditch, banks are dipping into their loan-loss reserves to report profits.

To illustrate, bankers have cut their ratio of loans to reserve coverage almost in half – that is the amount reserved divided by noncurrent loans (90 days past due or more and loans on nonaccrual). This ratio has declined from 120 percent in March of 2007 to 65.1 percent at June 30 of this year.

Banks added a total of $40.3 billion in provisions to their loan-loss allowances in the second quarter: that is the smallest total since the first quarter of 2008 and is $27.1 billion less than the industry’s provisions in the second quarter of 2009.

So, the banking industry made $21.6 billion in Q2 by not putting as much away for loan losses...o the big banks are backing off on putting money in reserve and booking big profits only months after being rescued by government TARP moneys (by the way, 91 banks are behind on making their TARP payments to the government). More importantly, these banks were the primary beneficiaries of accounting-rule changes in April of 2009 – amendments to FASB rules 157, 115, and 124, allowing banks greater discretion in determining at what price to carry certain types of securities on their balance sheets and recognition of other-than-temporary impairments...

[Demeter]

88. Bank Failures in Slow Motion, Part II By Douglas French

http://dailyreckoning.com/bank-failures-in-slow-motion-part-ii/

“‘Deposit insurance’ is simply a fraudulent racket.” – Murray Rothbard

Sheila Bair, the Chairman of the US Federal Deposit Insurance Corporation (FDIC), has said many times that the peak in bank failures would not occur until the latter part of this year. What’s the holdup? Why aren’t more banks being closed more quickly?

1. Maybe there’s nobody left at the FDIC who knows how to make a deal.

After all, the FDIC’s main dealmaker, Joe Jiampietro, left suddenly in August. Jiampietro came to work at the deposit insurer after working at JP Morgan Chase and UBS. He and his partner Jim Wigand sold more than $508 billion in assets including WaMu and Corus. The New York Times reported that Wigand and Jiampietro did good work for the government, “by acting like bankers, not bureaucrats.”
....................

2. Maybe it’s politics.

Bill Bartmann, publisher of the Bartmann Bank Monitor Report, says the FDIC isn’t closing banks faster because of politics.

“The FDIC is waiting until November to drop the other shoe,” Bartmann claims. He says 500 banks will be closed in 2011 after the mid-term elections have been completed.

Are bank failures political? Shorebank in Chicago was kept alive for months: “Senior Obama adviser Valerie Jarrett served on a Chicago civic organization with a director of the bank, and President Obama himself has singled out the bank for praise in lending to low-income communities.” But the politically connected bank was finally seized on August 20th, when the FDIC finally found a single buyer for the failed bank – Urban Partnership, which includes “American Express Co., Bank of America Corp., Citigroup, Ford Foundation, GE Capital’s equity investments arm, JPMorgan Chase & Co., Key Community Development Corp., Morgan Stanley, Northern Trust Corp., PNC Investment Corp., Goldman Sachs Group Inc., and Wells Fargo & Co. Former First Chicago executives who joined ShoreBank in recent months will run the bank.”

3. Maybe the number of bidders for bad banks has dried up.

The juicy deals Jiampietro and Wigand were making last year are over, The Wall Street Journal reports. According to Keefe Bruyette & Woods (KBW), acquiring banks were booking 4.5 percent capital gains on deals done in 2009. That is now down to 2.5 percent.

Investors are halting efforts to bid on the failed banks, saying the economics no longer make sense....

4. Or maybe the FDIC just doesn’t have the money to close banks.

The FDIC Deposit Insurance Fund has already spent over $19 billion this year, which is well above the $15.33 billion prepaid assessments that it collected from banks for all of 2010....

[Demeter]

4. The Hitchhiker's Guide to the Galaxy

http://en.wikipedia.org/wiki/The_Hitchhiker%27s_Guide_to_the_Galaxy

The Hitchhiker's Guide to the Galaxy is a science fiction comedy series created by English writer, dramatist, and musician Douglas Adams. Originally a radio comedy broadcast on BBC Radio 4 in 1978, it was later adapted to other formats, and over several years it gradually became an international multi-media phenomenon. Adaptations have included stage shows, a "trilogy" of six books, with the first five published between 1979 and 1992, and the sixth by Eoin Colfer published in 2009, a 1981 TV series, a 1984 computer game, and three series of three-part comic book adaptations of the first three novels published by DC Comics between 1993 and 1996. There were also two series of towels, produced by Beer-Davies, that are considered by some fans to be an "official version" of The Hitchhiker's Guide to the Galaxy, as they include text from the first novel. A Hollywood-funded film version, produced and filmed in the UK, was released in April 2005, and radio adaptations of the third, fourth, and fifth novels were broadcast from 2004 to 2005. Many of these adaptations, including the novels, the TV series, the computer game, and the earliest drafts of the Hollywood film's screenplay, were done by Adams himself, and some of the stage shows introduced new material written by Adams.

The title is the name of a fictional, eccentric, electronic travel guide, The Hitchhiker's Guide to the Galaxy, prominently featured in the series.

The Hitchhiker's Guide to the Galaxy<3> is often abbreviated "HHGTTG" (as used on fan websites) or "H2G2" (first used by Neil Gaiman as a chapter title in Don't Panic and later by the online guide run by the BBC). The series is also often referred to as "The Hitchhiker's Guide", "Hitchhiker's", or simply " Guide". This title can refer to any of the various incarnations of the story of which the books are the most widely distributed, having been translated into more than 30 languages by 2005.

[Demeter]

5. Start the film here

http://www.youtube.com/watch?v=s6KWnVh-JDs&feature=related

[Demeter]

6. CAR TALK

[Demeter]

7. Jaguar Land Rover seeks China plant

Jaguar Land Rover, the UK-based luxury vehicle business owned by India’s Tata Motors, plans to produce more than 50,000 vehicles a year from a new plant in China employing up to 5,000 staff

Read more >>
http://link.ft.com/r/EB8122/JIOEP6/9MEOW/BM1IJM/9Z9IER/B7/t?a1=2010&a2=11&a3=5

[Demeter]

8. THE STATE OF THE STATES

[Demeter]

9. US economy adds 151,000 jobs

The US added 151,000 workers in October as businesses shrugged off fears of a feeble economic recovery and accelerated the pace of hiring, according to labour department figures.
The rise was more than double the increase that economists were expecting and was boosted by the addition of 159,000 workers in the private sector. The unemployment rate held steady at 9.6 per cent in October.
Investors cheered the news as S&P 500 futures, which were falling ahead of the report, edged up 0.2 per cent to 1,221.00, adding to a the two-year high reached on Thursday.
The yields on benchmark 10-year
Treasuries, which had been edging up before the announcement, rose 7 basis points to 2.56 per cent. The dollar, which fell to its lowest level in almost a year on Thursday, rose 0.6 per cent to 76.35 against a trade-weighted basket of currencies.

Read more >>
http://link.ft.com/r/S4XZQQ/PRZR43/NRHD3/YHY0ID/PR6BU1/6C/t?a1=2010&a2=11&a3=5

IT'S ONLY A STORY....

[Demeter]

30. Economy Stops Blowing Jobs

http://www.zerohedge.com/article/economy-stops-blowing-jobs

...You all know Money McBags is no mathematician (though he has many ways to solve the three body problem (hint: flexibility) and he sometimes likes to work things out with a pencil), but if new claims for unemployment are averaging ~450k per week and there are roughly 4 weeks in a month and thus ~1.8MM people lost their jobs, wouldn't a net 151k new jobs imply that a gross 1.95MM jobs were actually created this month? And there is more of a chance of 1.95MM jobs having been created this past month than there is of Ben Bernanke giving the opening address at a Tea Party convention or Edward Nino Hernandez winning the high jump competition in the next Olympics. Seriously, there is clearly a bigger disconnect here between the new claims for unemployment numbers and the jobs report number than there is between Josef Fritzl and parenting or Amy Winehouse and hygiene as how the fuck can there be 1.8MM people being laid off and yet 151k new jobs created at the same time? It is stranger and more confusing than what goes on at a Rugby party and Money McBags is sure he is just misinterpreting something, but what that something is, he is not quite sure...

[Po_d Mainiac]

53. how does a mathematician deal with constipation?

[Tansy_Gold]

54. He. . . .

works it out with his fingers. . . . .



(some things from junior high never leave you, y'know?)

[Demeter]

56. OMG

I'm going to have to do something with the both of you...now behave!

[Tansy_Gold]

83. Well, see. . . . .

If I had actually READ the preceding article instead of just skimming it, I'd have realized the Mainiac was referencing the line from it about "working it out with a pencil."

*MY* error was in reverting to junior high mentality when we were even grosser than that.

So I only take PART of the responsibility. Because if YOU, Demeter, weren't such an old lady about scatalogical humor, you'd have RECOGNIZED that reference, not posted the snippet, and never led US into temptation!

IT'S ALL YOUR FAULT!!!! (only kidding!)

:hi:



Tansy Gold, up at 4:30 on Saturday to get ready for another art event and draggin' her feet 'cause she didn't make enough inventory. . . . ..

[Demeter]

84. I NEVER Heard It Before

and goddess willing, I will shut my eyes and ears and never have to, again.

I know some really raunchy Maxwell's Equations--but first I'd have to explain them....

[Po_d Mainiac]

92. Yeah Demeter, the onus is on you

:hide:

[Demeter]

14. Fed to buy $600bn in Treasuries

The Federal Reserve, in its most important decision in decades, said it would buy $600bn in longer-term Treasury bonds by the end of the second quarter next year

Read more >>
http://link.ft.com/r/WDI4RR/XTKF3D/RP6QL/BM15JA/40D0UM/HK/t?a1=2010&a2=11&a3=3

[Po_d Mainiac]

32. Congress can now think they can spend

interest free, thinking that inflation will eat up much of the balance.

End result will be food and fuel prices leaving the solar system as wages melt into the Earth's magma layer.

Highest rated shows in 2012:

Dances In Spite Of The Scars.
2 1/4 Men...(Jake sacrificed a Ham for the cause)
90 minutes (10 mins. of reporting surrounded by 80 minutes of 'Credit Relief" ads)....people tune in for the ads
Jersey Sores
Deadliest Caught (toxic fish that will kill you)
Hell's Bitches (Hell's Kitchen and Real Housewives former cast)
Rookie Blew
Better off Dead
Wiped Out
The Good Wife AKA Quarters On The Dresser

[Demeter]

40. The Fed's magic money machine annoys the world

http://www.salon.com/technology/how_the_world_works/2010/11/05/the_federal_reserve_versus_the_world/index.html

What do China, Germany, Brazil and South Africa have in common? Answer: Each country boasts the largest economy on their respective continents, and each country strongly disapproves of Ben Bernanke's recently announced attempt to stimulate U.S. growth by injecting $600 billion of newly created money into the economy. Next week's G-20 meeting of the world's advanced economies is shaking up to be a doozy!

MORE--AND IT'S KINDA WEIRD

[Demeter]

41. Bernanke answers Fed's global critics

http://news.yahoo.com/s/nm/20101105/bs_nm/us_usa_fed

Federal Reserve Chairman Ben Bernanke on Friday defended the U.S. central bank's bond-buying against beggar-thy-neighbor criticism, saying the return to a strong U.S. economy was critical for global stability.

He suggested doing so would bolster a dollar whose weakness has sparked cries of foul from Bogota to Beijing...

PROVING ONCE AGAIN THAT YOU CAN LEAD A HORTICULTURE, BUT YOU CANNOT MAKE HIM THINK....

[Demeter]

86. Bill Gross: Fed Actions Could Lead to a 20% Weaker Dollar By Rocky Vega

http://dailyreckoning.com/bill-gross-fed-actions-could-lead-to-a-20-weaker-dollar/

AND THIS IS A GOOD THING HOW?

[Demeter]

102. QE2: Last Rites for the World's "Reserve Currency" By Mike Whitney

http://www.informationclearinghouse.info/article26764.htm

Millions of Americans have no idea what Quantitative Easing is or how it will effect them personally. That's why Wednesday's announcement that the Fed will purchase another $600 billion in US Treasuries merely reinforced feelings of helplessness and a sense that government spending is out-of-control. Unfortunately, Ben Bernanke's rambling explanation of QE2 in a Washington Post op-ed on Thursday only added to the confusion. The article is loaded with half-truths and omissions that are meant to mislead the public about how the program works and what the Fed's real objectives are. It's another missed opportunity by Bernanke to come clean with the people and let them know what policies are being enacted in their name. Here's an excerpt from the article:

....

Bernanke mentions employment/unemployment 5 times in the first 3 paragraphs to give the impression that QE is about creating new jobs. But everyone knows that's baloney. If Bernanke was really worried about jobs, he would have appealed to Congress for a second round of fiscal stimulus in his speech, which he didn't, because he remains hawkish on deficits like his colleagues in the GOP-led congress...

The truth is, Quantitative Easing will not reduce unemployment, narrow the output gap, or increase aggregate demand. At best, it will lower long-term interest rates (slightly) and buoy asset prices. That may be good for the stock market, but it won't lay the groundwork for a strong recovery. In fact, it might not even be enough to keep the economy from slipping back into recession. As last Friday's report from he Bureau of Economic Analysis indicates, most of 3rd Quarter GDP was from rebuilding inventories. Remove inventory restocking, and final demand was a sickly 0.6%. So, how will Bernanke's bond purchasing program increase final demand?

It won't. If the Fed buys Treasuries, Treasury yields go down which pushes investors into riskier assets (like stocks). That pushes stocks higher, investors feel richer, spending takes off, businesses hire more workers, and the economy grows. It's a great theory, but it doesn't work. Yields are already at record lows and businesses are still not hiring because there's no demand for their products. The problem cannot be fixed from the supply side, which is to say, that it doesn't matter how cheap money is, if no one is borrowing. And no one is borrowing because they are either broke or out-of-work. Bernanke's grand plan doesn't get money to the people who need it, so the economy will continue to sputter...

[Demeter]

103. So WHY Is Bernanke Doing This? (MORE WHITNEY)

The reason is that the Fed is locked in a violent exchange-rate war to push down the value of the dollar. Bernanke wants to trim the current account deficit to boost exports. But he'd rather not tell the American people that he's using their currency as a bludgeon to beat trading partners into submission. It's easier just to scribble some gibberish about "generating jobs" and send it off to the Washington Post.

The Fed is at war; that's the truth of the matter. Economist Michael Hudson calls Quantitative Easing (QE) "a form of financial aggression." But Hudson probably understates the case; "monetary terrorism" (moneterrorism?) is probably closer to the truth. QE is flooding emerging markets with cheap capital that's forcing their leaders to take defensive action to protect their economies. EM's have already seen the first wave of liquidity surge into their markets raising havoc with prices and forcing central banks to raise rates. But emerging markets aren't taking it laying down. They're throwing up protectionist barriers and monitoring capital flows. If Bernanke's going to print more money, they'll print, too. Mass competitive devaluation will ignite a full-blown currency war that leaves the present trade regime in tatters and the dollar in the dustbin.

I THINK WE HAVE A NEW WAR CRIME, FOLKS, AND A NEW MASTERMIND

[Demeter]

104. Finance Has Become a New Form of Warfare Michael Hudson

http://www.informationclearinghouse.info/article26768.htm

VIDEO AND TRANSCRIPT AT LINK

[DemReadingDU]

26. What's the significance of 42

having a senior moment, brain fade, mental glitch

[Po_d Mainiac]

33. The answer to every problem THGTTG

http://en.wikiquote.org/wiki/The_Hitchhiker%27s_Guide_to_the_Galaxy
Chapter 47

[DemReadingDU]

72. Heard about THGTTG, but never read anything

Catching up
:)

http://en.wikipedia.org/wiki/The_Answer_to_the_Ultimate_Question_of_Life,_the_Universe,_and_Everything#Answer_to_the_Ultimate_Question_of_Life.2C_the_Universe_and_Everything_.2842.29

or
http://tinyurl.com/2b6sw5y

[Demeter]

75. Largest 15 US States are Spending Over 220% of Their Tax Revenue By Rocky Vega

http://dailyreckoning.com/largest-15-us-states-are-spending-over-220-of-their-tax-revenue/

As spotlighted by Meredith Whitney, CEO of the Meredith Whitney Advisory Group, the feds are continuing to subtly bailout state governments at record levels and in an ongoing and unsustainable fashion which she describes in a recent WSJ opinion piece.

From The Wall Street Journal:

“What <...> investors fail to appreciate is that state bailouts have already begun. Over 20% of California’s debt issuance during 2009 and over 30% of its debt issuance in 2010 to date has been subsidized by the federal government in a program known as Build America Bonds. Under the program, the U.S. Treasury covers 35% of the interest paid by the bonds. Arguably, without this program the interest cost of bonds for some states would have reached prohibitive levels. California is not alone: Over 30% of Illinois’s debt and over 40% of Nevada’s debt issued since 2009 has also been subsidized with these bonds. These states might have already reached some type of tipping point had the federal program not been in place.

“Beyond debt subsidies, general federal government transfers to states now stand at the highest levels on record. Traditionally, state revenues were primarily comprised of sales, personal and corporate income taxes. Over the years, however, federal government transfers have subsidized business-as-usual state spending not covered by state tax collections. Today, more than 28% of state funding comes from federal government transfers, the highest contribution on record.

“These transfers have made states dependent on federal assistance. New York, for example, spent in excess of 250% of its tax receipts over the last decade. The largest 15 states by GDP spent on average over 220% of their tax receipts. Clearly, states have been spending at unsustainable levels without facing immediate consequences due to federal transfer payments and other temporary factors.”

Because the federal government will backstop the states regardless of their profligacy — a situation which tends to play out differently in the European Union, for example — the bickering, relatively speaking, flies under the radar and the fiscal irresponsibility just isn’t as high profile (as compared to the highly-visible EU member state (GIIPS) meltdown). As it goes, the state budget situation is continuing to deteriorate just as the Fed is firing up the presses for another moonshot-caliber of stimulus for the economy. Basically, when the debt-laden US can already least-afford the expenditure. According to Whitney, “almost all of the major federal government subsidy programs will run out in June 2011.” So, we can probably go ahead and mark that “unforeseeable crisis” announcement date on next year’s calendar....

[Demeter]

76. ARTHUR?

Arthur: All my life I've had this strange feeling that there's something big and sinister going on in the world.

Slartibartfast: No, that's perfectly normal paranoia. Everyone in the universe gets that.

[Demeter]

97. Nine Stories The Press Is Underreporting -- Fraud, Fraud And More Fraud

http://www.huffingtonpost.com/2010/10/20/nine-stories-the-media-is_n_769620.html

William K. Black:


The things I think are critical and badly underreported are:


1. The astonishing amount of mortgage fraud (literally, millions of cases annually) and how it hyperinflated the bubble and led to the Great Recession.

2. The fact that these mortgage frauds were overwhelmingly due to consciously fraudulent lending practices in which the CEOs of seemingly legitimate entities used accounting tricks as their “weapon of choice" to report higher profits and get bigger bonuses. (George A. Akerlof and Paul R. Romer got it right in the title to their 1993 article: Looting: The Economic Underworld of Bankruptcy for Profit.)

3. The disgraceful lack of prosecutions which has resulted from regulators virtually ending the practice of making criminal referrals and the pathetic March 2007 "partnership" that the FBI entered into with the Mortgage Bankers Association (the trade association of the "perps") that led the FBI and the Department of Justice to (implicitly) define out of existence fraud by the lenders (and to conceive of them as the "victim" -- which they are, but only of their controlling officers). Bush administration attorney general Michael Mukasey in June 2008 notoriously refused to create a national task force against mortgage fraud based on his claim that mortgage fraud was analogous to "white collar street crime."

4. The "echo" epidemics of fraud set off by the primary epidemic of accounting “control fraud". The fraud designed by CEOs in turn kicked off an epidemic of fraud among loan brokers and appraisers. Reporters should explore the concept of the Gresham's-style dynamic in which bad ethics were a competitive advantage and drove good ethics out of the marketplace.

5. The massive foreclosure fraud we are seeing now as another "echo" epidemic. To optimize their accounting control fraud, lenders gutted underwriting. That led to "fraud in the inducement" (vis a vis borrowers), endemic documentation problems, and an extraordinary numbers of defaults. The process required tens of thousands of real estate financing personnel to commit fraud on a daily basis as their core function. Some of these people are unemployed, but many are in the industry and are presently engaged in loan servicing. Now that their job is to foreclose on properties, there is no reason to expect that they would suddenly become honest, and they haven't.

6. The ongoing massive cover up of losses on bad assets, particularly by the “too big to fail” institutions, which I call “systemically dangerous institutions” (SDIs). Those institutions, along with Federal Reserve Board Chairman Ben Bernanke and Congress (at the behest of the Chamber of Commerce and with no opposition from the Obama administration) in April 2009 forced the Financial Accounting Standards Board (FASB) to change the rules so that the banks do not have to recognize their losses unless and until they sell the bad assets. The implications of this cover up are large (and rarely reported). At the very least, it means that Treasury Secretary Timothy Geithner's propaganda campaign about TARP saving the world at virtually no cost (perhaps even a "profit") is nonsense -- despite its success in influencing the Washington Post and Los Angeles Times. Consider:

A) The repayment of TARP funds does not mean the banks are healthy. Their asset values are often grossly inflated, which means their net worth is grossly inflated. That means that the claims that we have increased net worth requirements (and that Basel III will further increase net worth requirements) are false. Net worth requirements have meaning only if the accounting is honest


B) The repayment of TARP funds does mean that the banks are freed from any meaningful restraint on senior officer compensation. Note that absent the accounting lies the banks would often be reporting losses (and failure to meet required capital requirements, or outright insolvency) and could not pay their senior officers bonuses and would be subject to mandatory closure under the Prompt Corrective Action (PCA) law.

C) No commercial entity would have ever signed the TARP deals on the terms that the U.S. drafted for itself. The U.S. provided not only fresh money but an unlimited de facto guarantee (along with permitting phony accounting). If the U.S. had negotiated competently it would have owned virtually all the shares of every TARP recipient (which, of course, was a political impossibility).

D) The accounting lies are stalling the recovery. Markets cannot clear promptly when one creates an incentive to hold massively overvalued assets for years.

E) The losses are still there, but the taxpayers are on the hook via Fannie and Freddie and the Fed (which has taken over a trillion dollars in toxic collateral at grossly inflated values).

7. The continued absence of effective regulation. It should be scandalous that President Obama left in charge, or even promoted, the anti-regulators who permitted the Great Recession. The (failed) anti-regulator of Fannie and Freddie, for example, remains FHFA's acting director. This is significantly insane as a matter of both economics and politics. (The administration doesn't even seem to realize the issue of integrity.)

8. The crises of state and local government and the lack of a rational basis for Republican and Blue Dog opposition to the proposed revenue sharing component of the stimulus bill. The compounding insanity of the administration failing to fight for its concept and failing to make explicit how badly its removal would harm the recovery, employment, and vital government services.

9. The insanity of accepting mass, long-term unemployment rather than having the government provide productive jobs for everyone willing to work (as the employer of last resort).

[Demeter]

105. Fitch Says 7M Homes in the Shadows Will Take 40 Months to Clear

http://www.dsnews.com/articles/fitch-says-7m-homes-in-shadows-will-take-40-months-to-clear-2010-11-01



OR MAYBE, JUST MAYBE, 42?

[Demeter]

107. LPS Report Shows Foreclosure Timelines Continue to Stretch

http://www.dsnews.com/articles/lps-report-shows-foreclosure-timelines-continue-to-stretch-2010-11-03

[Demeter]

118. Foreclosure Mess Scares Away Investors as 'Fear Has Taken Hold'

http://www.moneynews.com/Headline/ForeclosureMessChillsInvestors-CloudsMarket/2010/10/22/id/374618

Investors who have been snapping up foreclosed homes are backing off in the wake of the U.S. foreclosure fiasco, driven off by sagging inventory and fears over legal title. Some economists say the trend could hurt the overall housing market.

With foreclosed properties accounting for a large portion of housing sales, and investors accounting for a large portion of buyers — particularly in some key markets with very high foreclosure rates — the implications for the broader economy could be serious.

Investors who would buy, rehabilitate and then sell or rent foreclosures were playing a "huge role," in helping to clear the market, said housing economist Tom Lawler.

But many of those investors are now staying on the sidelines....

[Demeter]

108. Economy 101: Unemployment by the Numbers

http://abcnews.go.com/Business/wireStory?id=12070447

REAL NUMBERS AT LINK

[Demeter]

10. BANKSTERS--THE NEVERENDING STORY

[Demeter]

11. Hands loses EMI case against Citi

Guy Hands has lost the multibillion-dollar battle of reputations he started when he sued Citigroup last December, claiming that one of its most senior British investment bankers had misled him over his £4.2bn takeover of EMI in 2007

Read more >>
http://link.ft.com/r/R5WAEE/PRA9V5/06MUC/9ZP4PB/EWNILI/E4/t?a1=2010&a2=11&a3=4

BETTER LUCK NEXT TIME, GUY

[Demeter]

17. US banks seek foreclosure experts

US banks are beefing up their mortgage departments in response to growing pressure and concern over the use of “robo-signers”, employees who rubber-stamped thousands of foreclosure documents without checking the accuracy of the information they contained, as required by law.

Read more >>
http://link.ft.com/r/FG6LAA/5CJ194/87I64/BMUA3D/IYUWYC/VU/t?a1=2010&a2=11&a3=2


BETTER LATE THAN NEVER...

[Demeter]

25. Goldman Conspiracy’s “Halloween Chainsaw Massacre Party” Vote: “Best Costume” on Your Favorite Ameri

Goldman Conspiracy’s “Halloween Chainsaw Massacre Party” Vote: “Best Costume” on Your Favorite American Financial Villain for a Horror Film!

http://wallstreetwarzone.com/vote-our-new-annual-goldman-conspiracys-halloween-chainsaw-massacre-party-costume-contest-vote-for-your-favorite-costume%E2%80%9D-on-your-favorite-american-horror-films-financial-villains/

Hank Paulson: as Leatherface in “The Texas Chainsaw Massacre” - Ben Bernanke: as Bela Lugosi, the vampire in “Count Dracula” - Lloyd Blankenfeld: a “Giant Vampire Squid” - Tim Geithner: Damian, the young prince-of-darkness in “The Omen” - Larry Summers: as Hannibal Lecter in “Silence of the Lambs” - CEOs of Wall Street’s “too-evil-to-die” banks: Every one a “Frankenstein” - U.S. Senators: Zombies & Ghouls in “The Night of the Living Dead” - Congressional Representatives: “Invasion of the Body Snatchers” - Dick Cheney: Yes, Darth Vader ...

[Demeter]

28. Not Just Stocks ... High Frequency Traders Might Be Manipulating Futures, Options, Bonds, Currency

Not Just Stocks ... High Frequency Traders Might Be Manipulating Futures, Options, Bonds, Currency and Commodities Markets As Well

http://georgewashington2.blogspot.com/2010/10/high-frequency-traders-might-be.html


As I noted earlier today, high frequency traders trade not only stocks, but also futures, options, bonds and currency:



We know that high frequency trading is used to manipulate the stock market. The prevalence of high frequency trading in other markets means that it might be used to manipulate those markets - perhaps virtually all markets - as well.

Indeed, by manipulating futures prices, it is possible to manipulate the current price of the underlying asset.

As the New York Times reported in September 2009:

It could well be that Optiver’s cowboy trading tactics are unique to the company. But as concern grows over the effect that high-octane computerized trading is having on markets worldwide, Optiver’s conduct in the oil futures market raises questions as to whether the relentless competition of this business is forcing companies to engage in similar practices. “These are proprietary trading shops that are masquerading as market makers,” said Tim Quast of Modern IR, a consulting firm that advises corporations on market structure issues.

The Securities and Exchange Commission has opened up an investigation into high-speed-trading practices, in particular the ability of some of the most powerful computers to jump to the head of the trading queue and — in a fraction of a millisecond — capture the evanescent trading spread before the rest of the market does.

[Demeter]

42. Buffett derivative bet pushes Berkshire to loss

http://news.yahoo.com/s/nm/20101105/bs_nm/us_berkshire

Warren Buffett's Berkshire Hathaway got the wrong end of a bet on future stock market prices in the third quarter, hurting profits and masking the substantial strength in his recently acquired railroad.

The billionaire investor's Burlington Northern Santa Fe railroad had heavy demand in the quarter to transport a range of commercial and agricultural products, reflecting the growing strength in the manufacturing sector.

Buffett called his purchase of the railroad "an all-in wager on the economic future of the United States," and its contribution to results lent credence to his strategy.

But the sore spot in the quarter was a loss on a portfolio of options tied to a basket of major stock indexes. Despite his distaste for derivative instruments, Buffett has insisted these bets would pay off, given their long time-frame and high upfront fees.

But they generated a loss of $700 million in the quarter, compared to a profit of $220 million a year ago...

SOMEBODY SPANKING BUFFETT?

[Demeter]

68. Christopher Whalen: Freddie and Fannie Helped to Create Epidemic of Mortgage Fraud

http://georgewashington2.blogspot.com/2010/10/christopher-whalen-freddie-and-fannie.html

BUT YOU KNEW THAT ALREADY FROM LAST WEEKEND...

[Demeter]

115. Watch Out: The World Bank Is Quietly Funding a Massive Corporate Water Grab

http://www.alternet.org/water/148700/watch_out:_the_world_bank_is_quietly_funding_a_massive_corporate_water_grab

Even though water privatization has been a massive failure around the world, the World Bank just quietly gave $139 million to its latest corporate buddy.

Billions have been spent allowing corporations to profit from public water sources even though water privatization has been an epic failure in Latin America, Southeast Asia, North America, Africa and everywhere else it's been tried. But don't tell that to controversial loan-sharks at the World Bank. Last month, its private-sector funding arm International Finance Corporation (IFC) quietly dropped a cool 100 million euros ($139 million US) on Veolia Voda, the Eastern European subsidiary of Veolia, the world's largest private water corporation. Its latest target? Privatization of Eastern Europe's water resources.

"Veolia has made it clear that their business model is based on maximizing profits, not long-term investment," Joby Gelbspan, senior program coordinator for private-sector watchdog Corporate Accountability International, told AlterNet. "Both the World Bank and the transnational water companies like Veolia have clearly acknowledged they don't want to invest in the infrastructure necessary to improve water access in Eastern Europe. That's why this 100 million euro investment in Veolia Voda by the World Bank's private investment arm over the summer is so alarming. It's further evidence that the World Bank remains committed to water privatization, despite all evidence that this approach will not solve the world's water crisis."

All the evidence Veolia needs that water grabs are doomed exercises can be found in its birthplace of France, more popularly known as the heartland of water privatization. In June, the municipal administration of Paris reclaimed the City of Light's water services from both of its homegrown multinationals Veolia and Suez, after a torrent of controversy. That's just one of 40 re-municipilazations in France alone, which can be added to those in Africa, Asia, Latin America, North America and more in hopes of painting a not-so-pretty picture: Water privatization is ultimately both a horrific concept and a failed project...

[Demeter]

116. Bernanke gets his "pink slip" By Mike Whitney

http://www.informationclearinghouse.info/article26718.htm

MIKE WHITNEY--HE'S SUCH A TEASE

[Demeter]

120. Bernanke's Dilemma By Mike Whitney

http://www.informationclearinghouse.info/article26701.htm

Ben Bernanke is in a real fix. His quantitative easing (QE) program is designed to boost stock prices, lower bond yields, and weaken the dollar. But the market has already priced all that in, so when he announces the start of the program on November 3, there's a good chance that things will either stay the same or head in the opposite direction. That's bad for Bernanke. Just imagine if the dollar strengthens just as the Fed chairman begins buying-up Treasuries to push the dollar down. He'll look pretty foolish. But that could happen because the dollar has already slipped nearly 7% since August and is overdue for a rebound.

So, what should he do? Should he go ahead and launch his program anyway knowing it could backfire and further damage his credibility or scrap the whole deal and move on to Plan B?

The truth is, he has no choice. If he doesn't follow through now, investors will accuse him of "withdrawing liquidity" and send the market into a nosedive. So, he has to go forward and let the chips fall where they may. If QE2 turns out to be a bust, so be it.

[Demeter]

117. I was a robo-signer

http://money.cnn.com/2010/10/28/real_estate/robosigner/index.htm

"I had no idea what I was signing," said Doan. "Either you were in or you were out."

[Demeter]

12. ECONOMISTS

[Demeter]

13. Mohamed El-Erian: QE2 likely to backfire

Given the high market expectations, the US Federal Reserve had no choice but to announce a second tranche of quantitative easing, nicknamed QE2. But the measure is an inevitably blunt instrument for the difficult task of restoring growth and generating jobs. The benefits accruing to America come with burdens for other countries, and both could soon be swamped by the unintended consequences of this unavoidably imperfect policy approach


Read more >>
http://link.ft.com/r/9ULF66/YHD3TH/VTVRG/8A3ZU5/RN0NYN/GX/t?a1=2010&a2=11&a3=3


I DON'T KNOW--THE SOONER THE TBTF, THE FED AND THE GSE'S GO UNDER, THE BETTER THE WORLD WILL BE...

[Demeter]

20. Now That The Elections Are Over, What Kind of Economy Did Americans Vote For? By Danny Schechter

http://www.newsdissector.com/blog/2010/11/02/what-kind-of-economy-did-voters-want-what-will-they-get/

The Election is over. The Dems were thumped. They lost the House, even if they still have the Senate by a hair. Barney Frank will be back but not Alan Grayson or Russ Feingold. Barrack Was Backlashed, even losing his former seat in Illinois. WSWS offered the key reason: “intractable and deepening economic crisis and the evident inability of the Obama administration to develop any policies to overcome it.”

Is that crisis likely to go away after an emboldened army of the righteous (and well-financed claque of economically responsible free market boosters) won more nominal power?

Will the deficits disappear?

Will the government shrink to what to what was in the era of the “founders?”

Will the economy breathe a sign of relief and bounce back?

Unlikely on all counts!

What that means is that the dire problems we face will likely get worse, as the Republicans try to stop any and all government intervention, focused as they are, for political purposes and ideological convictions, on being deficit busters.

[Demeter]

27. Time for a New Theory of Money

http://www.yesmagazine.org/new-economy/time-for-a-new-theory-of-money

By understanding that money is simply credit, we unleash it as a powerful tool for our communities...by Ellen Brown

The reason our financial system has routinely gotten into trouble, with periodic waves of depression like the one we’re battling now, may be due to a flawed perception not just of the roles of banking and credit but of the nature of money itself. In our economic adolescence, we have regarded money as a “thing”—something independent of the relationship it facilitates. But today there is no gold or silver backing our money. Instead, it’s created by banks when they make loans (that includes Federal Reserve Notes or dollar bills, which are created by the Federal Reserve, a privately-owned banking corporation, and lent into the economy). Virtually all money today originates as credit, or debt, which is simply a legal agreement to pay in the future.
Money as Relationship

In an illuminating dissertation called “Toward a General Theory of Credit and Money” in The Review of Austrian Economics, Mostafa Moini, Professor of Economics at Oklahoma City University, argues that money has never actually been a “commodity” or “thing.” It has always been merely a “relation,” a legal agreement, a credit/debit arrangement, an acknowledgment of a debt owed and a promise to repay....

[Po_d Mainiac]

34. Meh

The essay failed to note that the actual holder of the hard (no ladies this ain't porn) still holds the wealth.

NOTE: Holding hard refers to actual ownership of a precious or industrial metal...paper assets are considered limp by comparison

[Demeter]

36. And when the rule of law and trust are completely destroyed

possession is all that will save a body. Plus enough protection to fight off the dispossessed...

[Po_d Mainiac]

45. Game.. set... match...you win by default

:zippedlips:

I been raised by a wife and two daughters....I have dishes, laundry, and ironing to do.

42

Change is your guaranteed investment.....Details (bulletproof) tomorrow

[Demeter]

49. You Lost Me

Is it drinking time? I sure wish I had the capacity for drunkenness on a life like this.

[Po_d Mainiac]

51. 42 roflmfao

[Po_d Mainiac]

52. patience is a virtue dear

line 1
I know when to shut up
line 2
why i know when to shut up...gonna send you an image of my ironing board...which self built
line 3
U chose the theme
line 4
you will find out tomorrow..42

[Demeter]

31. Robert Scheer: An Obit For Our Hopes

http://www.grittv.org/2010/10/29/robert-scheer-an-obit-for-our-hopes/

[Demeter]

35. William K. Black

No Mr. President, Larry Summers Did Not Resolve the Financial Crisis for a Pittance, He Just Papered Over the Problem



...President Obama's appointment of Summers as his chief economic advisor made the administration's overall response to the crisis predictable. (Robert Kuttner gives a detailed explanation of the policies that Rubin's protégés championed in his new book, A Presidency in Peril.) The response would follow the disastrous Japanese model that has harmed their economy and damaged their integrity. The dominant characteristics can be summarized quickly: (1) the government would act for the benefit of the largest financial firms and their CEOs, even when they directed massive frauds, by (2) engineering a cover up of the banks' losses and the CEO's misconduct; (3) the administration would use the fictional reports generated to conduct the cover up to declare victory (due to their brilliance); and (4) the same strategy would impair the recovery. (For more on the cover up, see here and here.LINKS IN ARTICLE)

The strategy was also an assault on integrity, the rule of law, and the core precepts of the Obama campaign for president. This is why we warned from the beginning that the cover up could enrage the nation and make him a one-term president.

********


...Losses on homes are not driven only by employment and housing values. Mortgage fraud causes dramatically greater losses. How much mortgage fraud did the administration initially estimate? That's almost a trick question, for the administration rarely uses the "F" word (fraud) and gave no evidence at the time of its initial estimates that they took into account fraud losses. Since the time of the administration's initial loss estimates it has become indisputable that fraud was endemic in liar's loans and that liar's loans were not simply enormous, but also far more common than was originally reported. We have discovered since the administration's initial loss estimates that it was common for the SDIs to lie about the liar's loans they originated, sold, and purchased. Fannie, Freddie, Lehman and many others falsely called their liar's loans "prime."

What else could affect losses on liar's loans and CDOs backed by liar's loans? The failure of the secondary market meant that sales of CDOs and packages of liar's loans had to be individually arranged. Has the secondary market in nonprime mortgages been restored since the administration's initial cost estimates? No. That is important because the administration initially claimed that the secondary market's collapse was a temporary liquidity problem. The administration anticipated that the secondary market would soon reemerge. It died more than three years ago. With any luck it will never be resurrected. Once more, the changes since the time of the initial loss estimate should have led to greater losses than the administration's initial estimate.

This leaves us with two analytical puzzles. First, since the administration's anti-regulators have spent nearly two years carefully not looking at the liar's loans and determining their true value and the true incidence of fraud, how is the administration estimating losses without the facts necessary to make estimates? Second, ignoring the first problem for the moment, what miracle made virtually all the losses disappear -- at virtually no cost to the public -- even though every aspect of the administration's initial loss estimates proved too optimistic? Logically, the losses should be far greater. For the administration's claim to have any merit they must have discovered the ultimate "silver bullet" that slays $2 trillion in losses. So what is it -- and how did it save $2 trillion? It certainly wasn't their brilliant negotiation of the TARP terms. Any commercial lender that provided such an unlimited guarantee would have cut a far better deal.

There was no silver bullet. The administration made the losses disappear the old-fashioned way -- with fictional accounting. I have already explained how the administration allowed the Chamber of Commerce, American Bankers Association, and the Fed to enlist the Congress to extort FASB to pervert the accounting rules so that most of the SDIs' losses disappeared. The Fed also took over a trillion dollars in toxic, largely fraudulent collateral -- and carefully avoided conducting due diligence to discover either the value or the fraud incidence of the collateral. In essence, the Fed took the toxic stuff off the balance sheets.

Creating fictional numbers and hiding losses at the Fed doesn't reduce losses. Unfortunately, it increases real losses. First, it leaves the looters in charge, lets them pay themselves enormous bonuses, and lets them cause greater losses. Recall George Akerlof's and Paul Romer's title -- Looting: the Economic Underworld of Bankruptcy for Profit. They showed that even without a bailout the fraudulent CEO could grow wealthy by destroying "his" bank. With a bailout -- and the Bush and Obama administration's de facto grant of impunity and an unlimited guarantee to the SDIs -- the CEOs can loot without it leading inevitably to bankruptcy. This has made banking an even more criminogenic environment for accounting control fraud and will cause recurrent, intensifying crises.

Second, accounting cover ups prevent markets from clearing. That prolongs the recession. Japan shows how severe this problem can become.

Third, integrity is important. I really shouldn't have to explain this. It depresses me that I have to argue that it is wrong to lie. Our democracy, our economy, our society, and our souls depend on restoring our integrity and the rule of law. Randy Wray and I have proposed a step that would demonstrate the president's complete repudiation of Summers' strategy and a return to the rule of law: Place Bank of America in receivership for its tens of billions of dollars in fraudulent loans and its multitude of foreclosure frauds. Don't talk about doing the right thing -- do it -- and do it to a major contributor. Don't do it because it's a contributor, but because a bank that commits tens of thousands of frauds should immediately be placed in receivership.

MORE, MUCH MORE

[Demeter]

44. Let's Set the Record Straight on Bank of America: Open the Books! By William K. Black and L. Randall

http://neweconomicperspectives.blogspot.com/


While we welcome Bank of America's response to our two-part essay, "Foreclose on the Foreclosure Fraudsters," it does not actually respond to any of the facts or analytical points we made. Indeed, it does not engage the issues we raised. Bank of America's response contains some useful data on foreclosures that supports points we have made in prior articles, but overwhelmingly it is a plea for sympathy; Bank of America says it is beset by deadbeat borrowers and it is distressed that it is criticized when it forecloses on their homes. Bank of America portrays itself as the victim of an ungrateful public.

Bank of America Should be Placed in Receivership NOW

[Demeter]

60. Foreclose the Foreclosure Frauds (Part 1)

http://neweconomicperspectives.blogspot.com/2010/10/foreclose-foreclosure-frauds-part-1.html

AND SUPPORTING ARTICLES:


Specious Arguments Against a Bank Holiday
William K. Black and L. Randall Wray

http://neweconomicperspectives.blogspot.com/2010/10/specious-arguments-against-bank-holiday.html

...And, miracle of miracles, the banks would end up with the homes and get to restart the whole process again—from resale of the home through the financing, securitizing, and fee-for-servicing juggernaut.

Unfortunately, it did not go quite as smoothly as planned. The SDIs were supposed to act like neutron bombs – killing the homeowners but leaving the homes standing, to be resold. The problem is that wiping out borrowers lowered the value of real estate, crushing not only the real estate market but also construction and through to all associated sectors from furniture and home restoration supplies to big ticket purchases that rely on home equity loans. It also led to questions about the value of the securitized toxic waste manufactured and held directly or indirectly by financial institutions.

Next, a few judges began to question the foreclosures, as they saw case after case in which the banks claimed to have lost the paperwork or submitted amateurishly forged documents. Or, several banks would go after the same homeowner, each claiming to hold the same mortgage (Bear sold the same mortgage over and over). Insiders began to offer depositions exposing fraud and perjury. It became apparent that in many and perhaps most cases, the trusts responsible for the securities (often these are “special purpose” subsidiaries of the banks) never received the “notes” signed by the borrowers—as required by both IRS tax code and by 45 of the US states. Without the notes, billions of dollars of back taxes could be due, and the foreclosures violate state law. Finally, the Attorneys General of all fifty states called for a foreclosure moratorium....

[DemReadingDU]

79. Black and Wray should be put in charge to investigate the banksters

But the administration doesn't appear to want to prosecute anyone, so it's full steam ahead, until it all implodes.
:nuke:

[Demeter]

82. It took 3 tries to get the Pecora Commission

So, give it another 6 years. By then, the situation will be so futile that justice will be the only alternative.

[Demeter]

43. Trigger Points, Black Swans, And Other Unpleasant Realities

http://www.zerohedge.com/article/guest-post-trigger-points-black-swans-and-other-unpleasant-realities

A MASSIVE SUMMARY WITH SUPPORTING DOCUMENTATION OF OUR CURRENT STATE

[Demeter]

99. The Man Who Called the Financial Crisis—70 Years Early

http://online.wsj.com/article/SB10001424052748704405704575596382345085258.html?mod=WSJ_myyahoo_module

The seeds of today's problem were planted long ago, and its forgotten history holds important lessons. In 1936, as part of reforms under the new Banking Act, the U.S. government mandated that federally regulated banks could no longer hold securities that weren't rated investment-grade by at least two ratings firms. To determine how to implement the new policy, the government launched a massive project—with experts from the Federal Deposit Insurance Corp., the National Bureau of Economic Research and the Works Progress Administration—to study how credit ratings should be used.

Mr. Palyi, then teaching at the University of Chicago, was a vocal skeptic from the outset. Looking back into the 1920s, he found that investment-grade bonds went bust with alarming frequency, often in the same year they were rated. On average, he showed, a bank that followed the new rules would end up with a third of its bond portfolio going into default. The record was so unreliable that it would be "still more responsible," Mr. Palyi growled, to "stop the publication of ratings altogether." He was especially troubled that the new banking rules switched the responsibility for credit safety from bankers—and even bank regulators—to ratings firms. "From there," he warned, it "will have to be shifted again—to someone else," presumably taxpayers. Liquidity, Mr. Palyi argued, was being replaced by what he scornfully called "shiftability," a new kind of risk that could someday "be magnified into catastrophic dimensions."

In response to his criticism, government researchers studying how to apply bond ratings changed their method for calculating the performance of investment-grade bonds. By 1943 they had come up with an oddly contorted median that magically improved the track record of the ratings providers.

This switcheroo, recently documented for the first time by economists David Levy of George Mason University and Sandra Peart of the University of Richmond, legitimized the new regulatory model and flushed Mr. Palyi's criticism down the memory-hole of history. Credit ratings, in the words of economist Lawrence White at New York University, acquired "the force of law."

BUT WAIT! THERE'S MORE--CLICK THE LINK!

[Demeter]

15. OIL PATCH

[Demeter]

16. BP pay-outs to be less generous after spill

BP will adopt a far less generous dividend policy when it reinstates its pay-out to investors, its new chief executive indicated, as the oil group emerges from the shadow of its Gulf of Mexico spill.

Read more >>
http://link.ft.com/r/YIQXNN/XTKSQ3/EKRAI/72FCWW/LQTDJ4/T3/t?a1=2010&a2=11&a3=2

[Demeter]

18. THE ORIENT

FOR ALL THE FISH!

[Demeter]

19. China PMI jumps as rest of Asia slows

China’s manufacturers sharply increased output in October, powered largely by rising domestic demand and defying a widespread slowdown in the rest of Asia.

The Chinese purchasing managers' indices contrasted sharply with reports for South Korea, Taiwan and Japan, all of which showed a continuing slowdown in the wake of very rapid growth after the sharp contraction caused by the global financial crisis.

Read more >>
http://link.ft.com/r/DHGUVV/0GIE5K/GYN7Q/GKBZUV/LQTM64/28/t?a1=2010&a2=11&a3=1

[Demeter]

21. POLITICS

[Demeter]

23. Midterm Election Further Demonstrates Need for Revolution

http://ampedstatus.com/midterm-election-further-demonstrates-need-for-revolution

Midterm Election Further Demonstrates Need for RevolutionThe Obama referendum came in and he got what he deserved. When you run on change and leave the same criminals in positions of power and don’t hold anyone accountable for obvious crimes, and allow them to continue to commit those crimes, you deserve to lose your power. This is what happens when you put Tim Geithner and Larry Summers in charge of the economy, and support Ben Bernanke for reconfirmation as Chairman of the Federal Reserve. This is what happens when you keep Robert Gates as your Secretary of Defense and General Petraeus in charge of your wars. This is what happens when you lie to protect the interests of BP over the American people. This is what happens when you bailout Wall Street and the health care industry and sell out everyone else. This is what happens when your rhetoric is the opposite of your actions. The past two years have clearly exposed Obama as a spineless corporate puppet and he deserves to be voted out in 2012.

Now, don’t get me wrong, most of the people who were just voted into office are just as bad, if not worse, as hard as that is to believe. This election marks the third straight time that the American public dramatically voted out the people who were in power. The fact of the matter is that these people are not voting for politicians that they like as much as they are voting against politicians they hate. Hopefully by 2012 the American public will finally understand that they must support Independent candidates and alternative political structures, and cannot vote for Democrats or Republicans, if they ever want to achieve the needed change. Both parties serve the same corporate masters. Yes, there are some differences between the two. The Democrats serve half of the top economic one percent, and the Republicans serve the other half. We have Neo-liberals to the left and Neo-cons to the right, leaving 99% of us without representation....

– David DeGraw is the founder and editor of AmpedStatus.com. He is the author of The Economic Elite Vs. The People of the United States of America, and his forthcoming book is The Road Through 2012: Revolution or World War III.

[Demeter]

37. Johann Hari: Protest works. Just look at the proof

http://www.independent.co.uk/opinion/commentators/johann-hari/johann-hari-protest-works-just-look-at-the-proof-2119310.html

There is a ripple of rage spreading across Britain. It is clearer every day that the people of this country have been colossally scammed. The bankers who crashed the economy are richer and fatter than ever, on our cash. The Prime Minister who promised us before the election “we’re not talking about swingeing cuts” just imposed the worst cuts since the 1920s, condemning another million people to the dole queue. Yet the rage is matched by a flailing sense of impotence. We are furious, but we feel there is nothing we can do. There’s a mood that we have been stitched up by forces more powerful and devious than us, and all we can do is sit back and be shafted.

This mood is wrong. It doesn’t have to be this way – if enough of us act to stop it. To explain how, I want to start with a small scandal, a small response – and a big lesson from history.

....Many people emailed me saying they were outraged that while they pay their fair share for running the country, Vodafone doesn’t pay theirs. One of them named Thom Costello decided he wanted to organize a protest, so he appealed on Twitter – and this Wednesday seventy enraged citizens shut down the flagship Vodafone store on Oxford Street in protest. “Vodafone won’t pay as they go,” said one banner. “Make Vodafone pay, not the poor,” said another.

The reaction from members of the public – who were handed leaflets explaining the situation – was startling. Again and again, people said “I’m so glad somebody is doing this” and “there needs to be much more of this.” Lots of them stopped to talk about how frightened they were about the cuts and for their own homes and jobs. The protest became the third most discussed topic in the country on Twitter, meaning millions of people now know about what Vodafone and the government have done....

[Demeter]

38. Shock poll: Nearly half of Dems want a different nominee in 2012

http://www.rawstory.com/rs/2010/10/shock-poll-dems-nominee-2012/

[Demeter]

39. Road to Corporate Serfdom Ralph Nader

http://www.nader.org/index.php?/archives/2218-Road-to-Corporate-Serfdom.html

It was Bill Clinton’s campaign strategist, James Carville, who in 1992 created the election slogan: “It’s the Economy, Stupid.” For the 2010 Congressional campaigns, the slogan should have been: “It’s Corporate Crime and Control, Stupid.”

But notwithstanding the latest corporate crime wave, the devastating fallout on workers, investors and taxpayers from the greed and corruption of Wall Street, and the abandonment of American workers by U.S. corporations in favor of repressive regimes abroad, the Democrats have failed to focus voter anger on the corporate supremacists.

The giant corporate control of our country is so vast that people who call themselves anything politically—liberal, conservative, progressive, libertarian, independents or anarchist—should be banding together against the reckless Big Business steamroller.

Conservatives need to remember the sharply critical cautions against misbehaving or over-reaching businesses and commercialism by Adam Smith, Frederic Bastiat, Friedrich Hayek and other famous conservative intellectuals. All knew that the commercial instinct and drive know few boundaries to the relentless stomping or destruction of the basic civic values for any civilized society....

MORE

[Demeter]

58. An Open Letter to the White Right, On the Occasion of Your Recent, Successful Temper Tantrum

http://www.timwise.org/2010/11/an-open-letter-to-the-white-right-on-the-occasion-of-your-recent-successful-temper-tantrum/

Or as Po will certainly mention again: 42.

[Demeter]

100. ACTION ALERT! The Power of the Boycott - Max Keiser on Economics 101

http://vodpod.com/watch/4026038-the-power-of-the-boycott-max-keiser-on-economics-101

WATCH THE VIDEO--BOYCOTT THE FIRM!

[Demeter]

101. Before W

Trillian: You idiot! You signed the order to destroy Earth!

Zaphod: I did?

Arthur: He did?

Trillian: Love and kisses Zaphod? You didn't even read it, did you?

Zaphod: Well, I'm president, I don't have a lot of time for reading.

Trillian: My whole planet destroyed because you thought someone wanted your autograph!

Zaphod: Some parts of my character weren't what you'd call presidential.

[Demeter]

106. The Obama Postmortem An Autopsy of a Political Suicide By Ted Rall

http://www.informationclearinghouse.info/article26753.htm

It’s the day after the Republican sweep we all knew was coming. If Obama had any dignity, if he was honest with himself and with us, he would resign. It’s abundantly clear that he isn’t up to the job.

But you don’t become president by being honest or dignified. So now it’s wound-licking time. The President and his cronies are comforting each other. “It’s not your fault the economy sucks,” a Yes Man reassures Obama, sinking his heels into the new Oval Office carpet. “It was like that when we got here.”

Do they scratch him behind his ears? They should. It feels nice.

“It was the poor economy—not the wisdom of the Republicans’ ideas or the brilliance of their tactics—that assured they would retake control of the House,” coos MarketWatch’s Rex Nutting. Which is true. And doesn’t matter...In the broken-down shambles of the excuse for a political system we have in the United States, there’s only one stage of grief: denial....More than anything else, the American people are angry that their government doesn’t even pretend to give a damn about them.

[Po_d Mainiac]

22. 42

[Demeter]

29. How GE Paid A Total Of $5 Billion In Domestic Taxes 2002-2009 On $639 Billion In Domestic Profits

http://www.zerohedge.com/article/how-ge-paid-total-5-billion-domestic-taxes-betwen-2002-and-2009-639-billion-domestic-revenue?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+zerohedge%2Ffeed+%28zero+hedge+-+on+a+long+enough+timeline%2C+the+surv

One of the more popular topics recently is the collapse in corporate tax revenues, and the resultant push by the administration to ramp up taxation at the corporate level. As Zero Hedge has been disclosing for two months now, it all has to do with the now discredited concept of the "wall of money", which is mostly accumulated offshore and is thus not only available domestically, but is not taxed by the US. However, one company which has somehow managed to slip through the cracks is the infamous General Electric: the company, that in addition to the banks, has been the biggest beneficiary of Obama's taxpayer largesse. Here are the numbers: in the period between 1991 and 2009 GE's pretax income is cumulatively $293 billion on which however the firm has paid only $25.2 billion in current domestic taxes, or a 8.58% cumulative tax rate. Yet where it gets wild is the narrower period between 2002 and 2009, during which timeframe the firm made a generous $164.4 billion in pretax net income (not to mention $639 billion in domestic revenue, just over half of total revenues of $1.2 trillion) it paid only $5 billion in domestic current taxes, or a 3.17% tax rate! So our question to the administration is how does $639 billion in domestic revenue, and $164 billion in total net income, result in $5 billion in taxes? Perhaps if the desperately broke administration is so concerned about refilling its empty coffers, it should first of all look at the most profitable (presumably) company in America... And perhaps CNBC can share some coverage on the topic of its parent company's taxation strategy.

Note the red line below which shows the cumulative domestic current taxes paid by GE in the period 2002-2009, and compare it to the blue line, or total pretax income....SEE GRAPH AT LINK

[Demeter]

50. Tomorrow Is Another Day

And it may be covered in snow....Goodnight, folks!

[jtuck004]

55. "The Guide relates that the words "Share and Enjoy"...

were displayed in illuminated letters three miles high near the Sirius Cybernetics Complaints Department, until their weight caused them to collapse through the underground offices of many young executives. The upper half of the sign that now protrudes translates in the local tongue as "Go stick your head in a pig", and is only lit up for special celebrations."

http://en.wikipedia.org/wiki/Phrases_from_The_Hitchhiker's_Guide_to_the_Galaxy

From a soon to be released e-book...

The people at Goldman Sachs tried to tell them that they, the people of Goldman Sachs, were the real opponenets, not their neighbors in "the other" political party. It should have been a signal when Goldman found a way to collect the titles to homes, borrow trillions of dollars more than they were worth, and pocket the money while these people lost their homes. When that didn't work, they scrambled all their formulas and created financial products that any rational person would have laughed at, yet all the world snapped them up. When that collapsed, they collected more fish - they had begun to call taxpayer money "fish", because it seemed like they were being rewarded for their behavior, as if they were trained dolphins instead of reckless, avaricious sharks bordering on terrorism in the way that they looted the nation. In their narcissism they found a way to garner support from the very people whose accounts they sucked dry, while at the same time showing their pathological bent, that they would never, could never, stop. They even sent people from their corporation to work in the government, nearly throwing them money out the windows. No one understood their language.

Over time the country collapsed into chaos and ruin. Other nations didn't even bother with it, though there was some talk about storage of nuclear waste in the formerly open areas where wheat used to grow, where people now slaughtered and cooked wildlife on open fires among the garbage pits. It is the only meat available to them, these days. Goldman Sachs offices were empty, having been moved to Brazil. Their sign had fallen down shortly after the building collapsed from what engineers said was the weight of the money in the vaults. Now it was only lit up on holidays, because what was left of the sign looks like it says

"So Long, and Thanks for All the Fish".

[bread_and_roses]

57. Got my R in before it's too late, for a change! And Finance as Warfare on Democracy Now

Heard a good show on Democracy Now yesterday - interview with Michael Hudson on the Feds latest:

http://www.democracynow.org/2010/11/5/new_600b_fed_stimulus_fuels_fears

AMY GOODMAN: Our next guest, Michael Hudson, says finance has become a new form of warfare. Michael Hudson is Distinguished Research Professor at University of Missouri, Kansas City. A former Wall Street economist, he is the author of many books, including Super Imperialism: The Economic Strategy of American Empire.

Michael Hudson, welcome to Democracy Now!

MICHAEL HUDSON: Thank you.

AMY GOODMAN: Why warfare?

MICHAEL HUDSON: Well, the object of warfare is to take over a country’s land, raw materials and assets, and grab them. And in the past, that used to be done militarily by invading them. But today you can do it financially simply by creating credit, which is what the Federal Reserve has done. It’s created $600 billion. It hasn’t gone into the economy. The head of the Fed is known as "Helicopter Ben" because he talks about dropping money into the economy. But if you see helicopters, they’re probably not your friends. Don’t go out and wait for them to drop the money, because the money is all going electronically into the banks. And the Fed has said, we want to give the banks so much money that they will lend it out so you can begin to bid up prices on real estate again and pull the banks out of the real estate negative equity that it’s in. So the purpose, according to the Fed, is to raise the price of real estate, to inflate asset prices. But that’s not happening. The actual banks have lent less today than they did in 2007. So the money is going abroad. And it’s going abroad not really to buy foreign companies so much, but to speculate in currency.

Now, the Fed and the Congress, two weeks ago, said, "We want China to raise its currency by 20 percent." This would create billions and billions of dollars of bonanza for Wall Street banks, and it would enable them to earn their way out of debt by essentially looting the China central bank, the Brazilian central bank, the Turkish central bank and the other central banks, because you can now borrow money in America at one percent. So you’d put down, let’s say, a billion dollars of your own—a million dollars of your own money, borrow $99 million of the bank’s money—that’s $100 million. You would buy Chinese currency, RMB, for $100 million. You then say, "Raise your currency by 20 percent," which is what the Fed has asked them to do. That means that your million dollars now has turned into a $20 million gain, because $100 million is now worth $120 million. You’ve made a 200 percent profit. And for Wall Street, they deal in billions, not millions. And so, this would enable the banks to make up their money by buying out, essentially, foreign currency. They’re doing the same in Australia. It’s currency gamble.

AMY GOODMAN: What is—overall, what do you think President Obama should do, and what do you think he did wrong, since people say it’s the economy that took him down in the elections?

MICHAEL HUDSON: He has always represented Wall Street’s interest...

But what he’s turned into is the third Bush-Cheney administration. He’s reappointed the worst of the Bush people, like Tim Geithner as the Treasury secretary. He’s kept on the most right-wing of the Clinton people as his economic advisers. He is essentially in Wall Street’s pocket. And that’s not changed at all. And that’s why so many people were so disappointed. They believed that he was going to be for change, and he’s a good speaker, but he had no intention of doing the change at all, as we now see.

I don't know how much I'll be around this weekend - it's BREEDERS CUP!

(edit because I dropped half the quote in first paste)

[Demeter]

59. Good Luck!

Does that mean you didn't go to opening night for Secretariat?

[bread_and_roses]

77. I went - alas, "Secretariat" is gag-inducing treacle

to make sure I make my point, for any unfamiliar with the word: "treacle = contrived or unrestrained sentimentality: a movie plot of the most shameless treacle." (from dictionary.com)

Watch the races themselves on youtube to get a sense of Secretariat's unbelievable power - poor as the quality of the videos is, you can't miss it. Watch the Preakness, with his amazing last-to-first swoop down the outside, passing other flying horses as if they were standing still, moving so fast the announcer can't keep up with him. Or his last race in Canada, where he comes down the stretch looking like nothing so much as a medieval tapestry of the fire-breathing war-horse.

The movie conveys none of that, and totally blows the end of the Belmont - one of the most amazing (some think the most amazing) moments in all of sports, so the director can get his stupid jesus song in the film a second time. Too, too bad.

Preakness http://www.youtube.com/watch?v=g7-6_94SHK4

Last race - Woodbine in Canada http://www.youtube.com/watch?v=e01dC6UWXx8 (long, mostly boring intro but decent footage of the race and great shot of Sec blowing steam as he charges down the stretch)

[AnneD]

98. I have come to know and more importantly.....

come to appreciate these "Gifts of God" when I see them. To see a young Cassius Clay box, a Luciano Pavarotti, a Charlotte Church sing, a Tiger Woods tear up the golf course, or a Michael Jordan hang in the air for a humanly impossibly long time.

I remember Secretariat. Finest example of horse flesh I ever laid eyes on. The stats were amazing. Incredible chest, lung and heart size. He was born to do one thing and one thing only-run like the wind. I knew watching him that I would never see the likes of that in my lifetime ever again.

I shed tears when he died.

[Karenina]

121. I witnessed and bet on his win at Belmont.

Zennie did my heart good; such an elegant loss by such an incredible Lady. These days I cannot think of James Brown's "Man's World" without thinking of this:

http://www.youtube.com/watch?v=Febr_t_qa9U

Disjointed thoughts, perhaps. Or maybe not.

What I AM clear on is that this house of cards built atop a castle of sand WILL COLLAPSE. I noticed the discrepancy in the math at 10 and gave voice to it. Found my little black butt in the principal's office for using the word "cancer" to describe my doctor's daughter understanding of "unlimited growth" in our fifth grade discussion of capitalism. Half a century later, Happy Birfdars zu MOI, the same stupid still holds sway.

How many American kids have any clue about the basics of economics? How many members of Congress? :rofl:

Anne, I've seen you be runnin' for the emergency exit. May angels carry you lest you dash your foot upon a stone.

[Demeter]

125. Happy Birthday, Karenina

I've been called that myself--by a neighbor whom I truly doubt ever read Tolstoy.

[Demeter]

61. It Wouldn't Be a Proper Weekend Without America's Foremost Nerd

[Demeter]

85. Another Snide Remark

[Demeter]

62. SURVIVAL TACTICS

[Demeter]

63. How to Save $2,997 a Year on Food Without Even Noticing

http://www.huffingtonpost.com/eatingwell/save-3k-on-food-without-trying_b_771658.html#s162294

When I started doing research for our latest book, EatingWell on a Budget, I was blown away by the stats I came across. The one that sums it all up for me: a third of adults and 16 percent of children in the U.S. are obese and the highest obesity rates are associated with the lowest incomes and education levels, according to a survey by the Centers for Disease Control and Prevention. Adam Drewnowski, Ph.D., professor of epidemiology at the University of Washington, says, “Simply put, fats and sweets cost less, whereas many healthier foods cost more.” For many Americans, cooking healthy food on a budget seems impossible.

But it doesn’t need to be that way. A couple years ago we started costing out EatingWell recipes and we found that if you cook at home, with basic, all-natural ingredients, you can make delicious, healthy food for about the same amount it costs to get a fast food meal. All it takes is a little planning, smart shopping and the willingness to actually cook.

Today, with high food prices and a struggling economy, there’s never been a better time to learn how to eat well for less. Whether you are a family trying to make ends meet or are trying to save for kids’ college educations, these are lessons anyone can appreciate.

Here are 6 great ways to save almost $3,000 and recipes to go with them:

SEE LINK

[Demeter]

64. Scientists Find 'Liberal Gene' (SOUNDS MORE LIKE A MENTAL HEALTH GENE TO ME)

http://www.nbcsandiego.com/news/weird/Scientists-May-Have-IDd-Liberal-Gene-105917218.html

[Demeter]

65. Want to Increase Your Willpower? Here's How

http://www.huffingtonpost.com/judith-s-beck-phd/how-to-increase-your-will_b_772645.html

[Demeter]

67. Attack on the Middle Class!! — By James K. Galbraith

http://motherjones.com/politics/2010/11/galbraith-social-security-middle-class

...With manufacturing and construction on the ropes, service jobs now practically comprise the whole economy. Our rich folks today make their money in finance and technology; the upper middle class lives on trade, law, and medicine; and the middle class teaches and works in the civil service. The working class cooks, cleans, trucks, soldiers, stocks, repairs cars, makes beds, changes bedpans, and rings up sales. Today there are more salespeople, more hotel and restaurant workers, far more lawyers, doctors and accountants, and almost twice as many education and health workers as there are people producing tangible goods.

This isn't all bad. Conditions in stores, restaurants, and hospitals are often better than in factories. Jobs are more stable because labor in these businesses is mainly a fixed cost—an assembly line can be idled at a moment's notice, but a store needs salesclerks even when business is down. Goods made abroad are cheap, which helps consumers. The health and education sectors now have almost 30 percent more workers than they did in 2000, and that means, in part, more and better services in these areas.

The downside is that because many of these jobs aren't unionized, wages are lousy. The only thing that reliably bolsters service wages is the federal minimum wage: When it rises, as it did from $6.55 to $7.25 in 2009, service jobs above the minimum are forced up (PDF) as well (to maintain the spread). And when Congress doesn't raise the minimum, real wages decline with inflation....

[Demeter]

66. Argentinean President Dies, Business Rejoices

http://dissentmagazine.org/atw.php?id=298

In 2003 the left-leaning Néstor Kirchner took office in Argentina—in the aftermath of the 2001 collapse of the country’s economy and the popular uprisings that forced several successive governments from power. The neoliberal policies supported by the IMF and implemented by President Carlos Menem in the 1990s were widely seen as responsible for the collapse. Since then, Argentina has set an important example by breaking with the IMF and playing hardball with international creditors.

In 2003, the country made a credible threat of defaulting on its payments to the IMF—something previously unheard of for middle-income countries. In response, the Fund backed away from demands for austerity and higher interest rates. It did so for fear that other countries would follow Argentina in defaulting. The exchange shook the international standing of the IMF and allowed Argentina to finalize a renegotiation of over $100 billion in foreign debt in 2005. The renegotiation drastically reduced the value of the country’s outstanding obligations to private creditors.

And further:

The strategy worked, allowing his government to negotiate a very favorable restructuring of its loans. Argentina standing up to the IMF was like an underdog knocking down the schoolyard bully. The aura of invincibility surrounding the Fund was dispelled, and the institution will likely never again inspire the same begrudging awe.

Given that there is no international mechanism for countries to declare bankruptcy, and that the poor in many nations are held hostage by international creditors who ruthlessly demand payment even for clearly illegitimate debts, the president’s stand was a pivotal one.

[Demeter]

69. OPINIONS

"I've a million ideas, and they all lead to certain death." --Marvin the paranoid Android

[Demeter]

70. Plumbers Crack By Bill Bonner

http://dailyreckoning.com/plumbers-crack/

Poor Ben Bernanke. There was a strange glow on his face as it appeared in Monday’s Financial Times…like a bearded St. Joan of Arc; his hands were clasped together as if in prayer, and his eyes seemed to reach up to the gods, if not beyond.

He made his reputation as a master plumber in Princeton, New Jersey, interpreting drippy money supply faucets and deconstructing clogged fiscal drains. And now, he has become the hope of all mankind. Or at least that part of mankind that hopes to get something for nothing.

How came this to be? The answer is simple. The plumbers who came before him botched the job. Applying their wrenches to the recession of ’01, they let too much liquidity into the system. Everything bubbled up. The subprime basement overflowed in ’07…Ben Bernanke has been on the job ever since.

And this week the financial world held its breath. It waited. It watched. Ben Bernanke was hunched over…sweat on his brow…easing on his mind. Commentators, economists, and the public wondered if he could really create new money…new wealth…out of thin air? If this were true, it was a giant step forward for humanity, at least equal to discovering fire, creating Facebook or blowing up Nagasaki. Jesus Christ multiplied loaves and fishes. But He had something to work with. The Federal Reserve multiplies zeros…creating money – out of nothing at all. If it can really do the trick, we are saved. The legislature can go home. It no longer needs to worry about raising taxes or allocating public resources. Government can now buy all the loaves and fishes it wants. And give every voter a quart of whiskey on Election Day.

During the course of the last three years, the plumbers have spent hundreds of billions of dollars. It’s hard to know what the final bill will be, since so much money – more than $10 trillion – is in the form of guarantees and asset purchases. They’ve pumped. They’ve bailed. They’ve squeezed and turned. They scraped their knuckles and cursed the gods.

You’d expect they might think twice before spending so much money. But on the evidence, they haven’t even thought once. Quantitative easing has been tried before. Has it ever worked? Nope. Never.

[Demeter]

71. Or, as Douglas Adams would say:

He attacked everything in life with a mix of extraordinary genius and naive incompetence, and it was often difficult to tell which was which.

[Demeter]

73. All Treasuries All the Time: The Impact of QE2 By Addison Wiggin

http://dailyreckoning.com/all-treasuries-all-the-time-the-impact-of-qe2/

So… This is what life after “QE2” looks like:

* Record gold prices
* Stocks back at pre-Lehman levels
* And a dollar cruising toward its 2008 lows.

Everything is rallying…in terms of depreciating dollars. Mission accomplished. Ben Bernanke needs George W. Bush’s ol’ “shock and awe” flak jacket.

In case mainstream media coverage made you glaze over, here’s the quick and dirty of the Federal Reserve’s fateful decision…

* The Fed will buy $600 billion in Treasuries over the next 8 months
* The mortgage securities the Fed bought during QE1 now reaching maturity will continue to be rolled over into Treasuries, as they have been since August. That’s another $275 billion, give or take
* There was also the caveat that more of this could be in the works if unemployment stays high and inflation (as defined by core CPI) stays low.

Hmmn… If the federal budget deficit is supposed to run $1.2 trillion during fiscal 2011 (that’s the consensus guess)…and the Fed will purchase $875 billion in Treasuries over the next eight months (that’s two-thirds of a year)…



…then we quickly see the Fed plans to monetize all of all the debt that Treasury plans to spit out from now through the middle of next year, and then some.

This is yet another reason we don’t expect the House Republicans to convert to the gospel of fiscal responsibility any more than they did last time they were in the majority: They can indulge in demon spending unto oblivion…and the Fed will have their back...

[Demeter]

74. MR. ADAMS?

Marvin: I think you ought to know I'm feeling very depressed.

Trillian: Well, we have something that may take your mind off it.

Marvin: It won't work, I have an exceptionally large mind.

Trillian: Yeah, we know.

[DemReadingDU]

90. Ilargi at The Automatic Earth explains QE2

It's not about helping Main Street


Ilargi: Let's start off by repeating once again what I still don't think everyone acknowledges: in essence, quantitative easing is a measure that is entirely experimental at best.

If there is any proof regarding its effectiveness, that proof is negative.

Japan's early millennium QE didn't revive its economy. Far from it.

The Fed's QE1, initiated in early 2009 and subsequently vastly expanded, never solved the problems it was alleged to be able to solve.

One may argue that it kept the economy from sliding downward even further, but one can claim that, and many of those with skin in the various games do, for a litany of stimulus measures such as TARP and the "Obama stimulus" as well.

The success of all these measures added together surely can't be seen as anything but ephemeral (re: unemployment and foreclosures), and the claim, if one were indeed made, that QE1 all by itself even just managed to keep the US economy in its present prolonged and drawn-out Wile E. Coyote moment, has no substance at all that is based on actual fact. Or, to put it another way, if QE1 achieved such a thing, which we don’t and can't know, the TARP and other stimulus measures were even grosser failures than we already recognize them to be.

Still, this week brought another round of QE in the US.

Why is that? Are we to believe that Bernanke et al perhaps can't read or do simple calculus? Are they desperate enough to throw the nation's financial future to the sharks, come what may? Has their faith in their particular sect of economics blinded them to such a degree that they can shake off all the evidence to the contrary and goose march ahead believing that even though all they did before has failed, "this will be the one"?

Of course not.

You may think by now that Geithner and Bernanke and Larry Summers and Bob Rubin and all the rest of the pack are miserable failures and two sheets to the wind and all that, but you'd do better to give them a lot more credit than that.

QE2 is here, despite the gigantic failures and behemoth losses of its predecessors, because QE works like a Mother Mary statue in tears' bleeding charm. Of course these guys all know that no proof of a QE ever reviving an economy exists. But they can pretend it does, and so they do: $900 billion, even for them, is real money.

Thing is, they never meant QE2 to do what they publicly claim they intended it for. This is nothing but another move to bail out lethally wounded banks.

A full additional $900 billion and counting was announced this week. Basically nothing but a swap of long term for short term paper, and therefore necessarily a -very- short term measure. What does it achieve, apart from a knee-jerk market reaction?

Wall Street banks get another injection of short term breathing space. That's all. And what was that last number on insider selling vs buying again? 3000 to 1?! Look, these people can't sell all their hygienic paper all at once, there's silly market regulations that prevent it, they need a time window to do it.

Hey, Bank of America rose 2% today, and Citi was up 3.7%. Now, if all is that rosy, why are William K. Black and L. Randall Wray calling for BofA's books to be opened and the entire firm to be nationalized? Well, BofA shares are at $12, an 80% loss from 3 years ago, and Citi's at $4, a well over 90% loss over the same time period.

These are America's largest financial institutions, and finance over the past 10-20 years has become a disproportionally huge chunk of the US economy. And its politics. And that's where the crux is.

I don’t know about you, but I have completely lost interest in trying to figure out which candidate in the midterm elections got how much from Wall Street. They all need their campaign contributions from bankrupt institutions such as BofA and Citi if they want to have a shot at being elected. It's a closed system, it really is. Putting a few guys behind bars wouldn't change that. And besides, none of them paid that kind of money just to be put behind bars to begin with.

But let's not try and solve it all in one go. For now, please understand that QE2 was never intended to jump-start the American economy. It was meant to prolong Wile E.'s 15 minutes of fame, to keep banks like BofA and Citi above water long enough to allow anyone who has some skin in it to get the hell out without triggering any alarm bells.

I mean, I see people triumphantly proclaim that stock prices are almost back to where they were. But look at those two banks! They're barely alive anymore, even in the markets. Citi's $4 a share is gutter territory, if not penny. Yes, sure, Goldman Sachs and JPMorgan have lost much less, percentage wise. And you know why? Because their links to Main Street are much less pronounced than those of consumer banks like BofA and Citi. That’s the difference. And Main Street is vanishing altogether.

There is money being handed out in QE2, which in the end is awfully simply yours, and which is thrown overboard in a way that makes you believe it's in your best interest. Some people see it as a hidden tax, but that's a far too gentle view. Daylight stand-and-deliver robbery or Grand Theft Auto are much more accurate denominations. After all, if this were a tax, it's clear to anyone and their pet parrot that it will never ever be paid off.

QE1, by the way, was to a large extent about the Fed buying up mortgage backed securities. Which, so it turns out, are based on, to put it mildly, highly disputable underlying "assets". What was it, $1.7 trillion?! And what would you think that's worth today? Or rather, what will it be worth once mark-to-miracle accounting can no longer "do the Wile E."?

Between the Fed and Fannie Mae and Freddie Mac, the American people own very very many trillions of dollars in silly paper. It's hard to say what its true value is, but once them whips and chips come down, it’ll be safely below double digits. Which will add up to much more than any hidden tax could ever hope to pay back.

Fannie just asked for another $2.5 billion of your cash, and they will get it too, and there's nothing you can do about it.

And you're right, what's $2.5 billion in the grand scheme of things? Then again, what's 1 in 7 Americans relying on food stamps? What does any of it mean anymore? 17% U6 unemployment? 4 million 2010 foreclosures, many of which are based on at least shaky, and pretty likely illegal, papers?

If that doesn't have enough meaning to move media attention away from rallies to restore whatever it is that apparently needs restoration, what will? 1 in 3 on food stamps? 40% jobless? Tent cities around every major city? $25 trillion in quantitative easing?

Yeah, the markets had a knee-jerk upward reaction. And that, or so it seems, is all anybody needs. Hyperinflation is sure to follow, or so they say. Then again, they said the same when QE1 occurred. Didn't happen, though. Will it this time? Will gold rise to the stratosphere? If so, who will buy? Bank of America? With your QE2 billions? Not very likely, they need that free cash to cover up increasing losses.

Is it that hard to understand, simple calculus? That every dollar spent ostensibly "on your behalf" will have to be paid back by you, even if not a penny of this, your own, money, went towards making your life better?

If that is really so, then QE2 works exactly the way it was meant to work. They're not all that dumb, and they're not making the grand mistakes some folks claim they do. They're robbing you blind in plain daylight, and, as they go along, make you believe that's in your best interest. It’s all nothing but a high-stakes game of pick-pocketing.

Just never even try to tell me again that it's not successful. And i don’t mean delivering economic growth; the US economy won’t see real growth for more years than you care to know. No, QE2 is very simply successful in fooling you.


related articles, and comments at the end of the posting
http://theautomaticearth.blogspot.com/2010/11/november-5-2010-qe2-is-fooling-you.html

[Demeter]

93. Singing to the Choir, Stoneleigh!

[Demeter]

80. A Movie Review: The Social Network By Bill Bonner RECOMMENDED READING

http://dailyreckoning.com/a-movie-review-the-social-network/

...The movie tells the story of the founding of Facebook. It is a “social network,” designed by students at Harvard to make it easy for people to keep up with each other.

“You mean, it will help us get laid,” says one of the characters in the movie…or words to that effect.

Occasionally, we get an email that tells us “so and so invites you to be a friend…” Once, we tried to follow up…we went to Facebook. There, we found a page of questions. We quickly lost interest and gave up. Henceforth, when asked to be a friend, we respond in the negative.

“Dad, you’re making a big mistake,” Jules, 22, opined. “I know a lot of people who don’t even check their email anymore. They communicate exclusively through Facebook. This is a big, big thing. And it’s not going away. E-mail could disappear.”

Maybe he is right. Maybe, in the future, we will publish The Daily Reckoning only on Facebook. But we hope not. We don’t like the concept. We don’t like the company. And we don’t like its shareholders...

PERSONALLY, I DON'T LIKE TO AIR MY LIFE IN THE OPEN FOR ANY PASSING CRACKPOT TO EXPLOIT, BUT THAT'S JUST ME--DEMETER

[Demeter]

81. FROM ANOTHER MOVIE

Arthur Dent: Just wait a sodding minute! You want a question that goes with the answer for 42? Well, how about what's six times seven? Or how many Vogons does it take to change a lightbulb? Here's one! How many roads must a man walk down?

Lunkwill: Hey, that's not bad!

Arthur Dent: Fine. Fine, take it. Because my head is filled with questions and I can assure you no answer to any one of them has ever brought me one iota of happiness. Except for one. The one. The only question I've ever wanted an answer to - is she the one? The answer bloody well isn't forty-two, it's yes. Undoubtedly, unequivocally, unabashedly yes. And for one week, one week in my sad little blip of an existence, it made me happy.

Trillian: That's a good answer...

Lunkwill: Rubbish, we don't want to be happy, we want to be famous!

Fook: Yeah! What is all this "is she the one" tripe?

Lunkwill: Take his brain!

[Demeter]

95. But For True Family Fun and Pathos--See "Beezus and Ramona"

I missed this when it premiered, but it was the free movie for kids this morning, and The Kid and I went...it was charming, true to the author but lovingly updated, and I cried through the entire second half. It's nostalgia in color, the childhood we wished we had...the childhood we hoped for our kids, and I'm sending a copy to the Younger Kid as soon as I can find one.

[Demeter]

78. More Stealth Gold Buying, This Time it’s Iran to the Tune of $15B By Rocky Vega

http://dailyreckoning.com/more-stealth-gold-buying-this-time-its-iran-to-the-tune-of-15b/

...Now, along with Saudi Arabia, Russia, and China, Iran is joining the club of surreptitious gold-hoarding nations. There appears to be ample evidence this club won’t stay too exclusive for very long...

[Po_d Mainiac]

111. And Bangladesh

http://www.ibtimes.com/articles/61474/20100911/bangladesh-buys-10-tons-of-imf-gold.htm

The International Monetary Fund (IMF) reported last week that Bangladesh bought 10 tons of Gold for $403 million. The gold was sold for the spot price as of Tuesday, the 7th of September, at around $1,250 per troy-ounce close, near an all-time high.

$46,000,000 profit at Fridays closing price, for whoever made this purchase :tinfoilhat:

[Demeter]

89. YOU KNOW, THIS IS REALLY WORKING OUT

I had doubts about being able to slog through the disasters, but with the stiff-upper-lip of the Brits, and the lemon of sarcasm, I might make it through.

Got to go back to the real world for a bit...Carry on!

[Po_d Mainiac]

91. So what are the odds of exchanging currency at a bank

and getting the equivalent of a 259% instant return on the transaction?

Believe it or not, my unscientific results range from 22-32%.

But if you only want to get a 125% return, the odds are (drum roll please) 100%

It's that Change thingy we've all been hearing about.

Lots of attention has been given to the rise of precious metals in relation to the U$D, but not so much to the other ores that are a necessity to modern life. So where is this going?

Reach into your pocket, or paw down through the used and crusty layer of handkerchiefs in the bottom of the purse, and grab that loose change. Not drop the coins on the table (if they aren't hopelessly fused to your fingers)

Check the dates on the pennies. If they are dated 1981 and earlier the copper value is $0.025955. As for the nickels. Their melt value is $0.0625 and there is no sorting required. Although it's always worth checking the reverse to see if there is a large mint-mark over the Monticello dome. That would signify a 1942-1942 silver nickel with a melt value of $1.50.

Random rolls of pennies, I've gotten from banks, will have 11-16 coppers/roll. Now there is that statute about destruction of Government Property thingy, but I suspect that in the near future we'll be seeing copper cents being melted at a rate similar to the pre-65 silver, and I don't recall anyone being prosecuted for the act.

Over the last year, my wife has found a couple silver quarters in the bottom of her handbag. At current silver prices they are each worth 19X their face value.

Now as Billy used to say "Wait, There's More"

If you're fortunate enough to live in an area void of 'Cherry Pickers' (Leave this alone Tansy, we've done enough damage already) you may be able to score some major finds in half dollar rolls. There are still a lot of 40% silver Kennedy's that were minted between 1965 and 1969 in circulation. At a melt of $3.95 the return rate is pushing 800% and likely to go higher as Chopper continues to trash the purchasing value of the U$D. BTW, 'Cherry-Pickers' is the term used to describe those that paw through coins looking for silver or minting errors.

Now if you really want to make a score, do some research and familiarize yourself with some of the rarer errors that collectors will pay for. The 1955 Double Die cent may be the most recent mint error people think about. It will command an easy $700-1200 or more depending on the condition, but the odds of finding one are nil. On the other hand 'CAM's' and 'WAM's" are rare, but found. Self has pulled a 1999 WAM out of my pocket and got $105 a couple years ago on eBay. (Average circulated coin wear)

WAM and CAM varieties refer to the spacing between the A and M of America on the reverse of the Memorial cents. (Close AM or Wide AM)
Beginning in 1993 all circulation strikes are supposed to be of the 'CAM' variety, but there have been a couple years that the mint used the wrong dies. A 1999P and 2000P WAM might be sitting on the dresser right now. A lightly circulated 1992D CAM sold a few years ago for $2900 and just a couple months ago, a Circulated 1992P CAM went (if I recall properly) for a staggering $5K!

Now about them 'Wheaties'. They ain't just for breakfast you know. These are still circulating, although finding them is no where near as common as just a few years ago. These are the pre-1960 cents and if you look at current coin auctions, bags are selling for 4-5X face value plus freight.

State quarters can be worth a small fortune. The 'Wyoming' farting horse (yup, that's what it's called) and the 'Wisconsin' extra leaf are just a couple that are being picked.

I've just barely touched on the varieties and values of collectible coins, and highly recommend you invest in a current edition of a coin guide.

As for the sure bet 'safe' investment. Sorting out the copper pennies is an absolute no brainer.

Good Luck

[Demeter]

96. Change Po Can Believe In

If I saved my change, though, we'd probably starve.

[Po_d Mainiac]

110. Then at least make sure u ain't spending a $100 penny!

[DemReadingDU]

113. Spouse had coffee cans full of coins

a can for quarters, another can for dimes, a third can for nickels, 2 cans for pennies

Rather than sorting thru all the coins, he took them to a coin counter, and exchanged them for dollars.

I bet we missed some good deals
:(

[Po_d Mainiac]

114. In the future, avoid the use of metal containers

Use ceramic, plastic, glass, wood, cardboard, etc....But no metal.

[Demeter]

109. You know, If We Are Going to Be Battlefield Reporters on the Global Economic War

we ought to get combat pay and shore leave....and a Pulitzer, at least.

Get some sleep (if you can) and we'll pick up some more pieces tomorrow.

[DemReadingDU]

112. Did everyone remember to turn back their clocks?

Extra hour today!
:)

[Po_d Mainiac]

122. Like back to 1978? n/t

[Demeter]

123. Have to go further back than that

not sure how far. Maybe we should move the clock forward, instead. This mess should be resolved in, oh.....a hundred years.

[bread_and_roses]

119. I think David Michael Green took a cue from Demeter for this week's "Regressive Antidote"

http://www.commondreams.org/view/2010/11/07-0

Of Irony and Implosion

by David Michael Green

Imagine how puzzled a visiting alien would be if you were forced to explain the election of 2010 to him. See in your mind's eye his antennae twisting themselves into slimy little pretzels as he attempts to apply logic - alien, Martian, human, twisted, any kind - to your explanation of what happened. "You see, little green dude, we were extremely unhappy with the state of our country, so what we did was to grab as many of the people as we could find who had just put us in that condition, and we put them back in power. Get it?" "No", he's thinking, "I don't". "But you're about to, as we vaporize your pathetic planet into a gazillion sub-atomic particles. Oh, and don't think the Universe will care, either, Mr. Supremely Illogical Humanoid Life Form. Everyone knows that you biped wankers are the least developed, most arrogant, and most buffoonish species in the entire Quadrant. You barely-down-from-the-trees hominids make the dwarf methane sloths of the Ursa Major Cluster seem like Galactic Wisdom Prize laureates by comparison!"

[Demeter]

124. OMG! He didn't really?

Well, I'm not sure if I've tapped into the Zeitgeist, or should sue for plagiarism...or might BE sued!

[bread_and_roses]

126. He publishes on Sunday, I believe - you post on Friday...

so I think you're OK, :)