Weekend Economists Play Ball! April 1-3, 2011

[Demeter]

Yes, now it's Baseball Season. The season has started for the Boys of Summer. How do I feel about baseball? I was in Detroit (my last year there) when the Tigers won the pennant in 1968. The city went into jubilation. As for me:

If a woman has to choose between catching a fly ball and saving an infant's life, she will choose to save the infant's life without even considering if there are men on base. ~Dave Barry

Playing ball has fielded a number of metaphors and similes in the American language. Let's see how many we can squeeze in, as levity to the dismal science. Cubs fans should be twice cheered by the effort!

This weekend marks the 43rd anniversary of the shameful assassination of Martin Luther King, as well. I remarked to a friend what I imagined it would be like If Dr. King and President Obama were to meet, recalling how the Rev. Wright was treated. I did not think it would have gone well.

In fact, I expect the results for Dr. King would have been exactly like those for Rev. Wright. Maybe it's a good thing Dr. King didn't live to see that.

[Demeter]

1. Obama and Boehner: Perpetuating the Lie That Spending Cuts Grow the Economy

http://www.alternet.org/newsandviews/article/545332/obama_and_boehner%3A_perpetuating_the_lie_that_spending_cuts_grow_the_economy/#paragraph6

John Boehner today:

We're listening to the people who sent us here to cut spending so we can grow our economy.

Obama last month:

I'm convinced that the only way we can make these investments in our future is if our government starts living within its means, if we start taking responsibility for our deficits. That's why, when I was sworn in as President, I pledged to cut the deficit in half by the end of my first term. The budget I'm proposing today meets that pledge -- and puts us on a path to pay for what we spend by the middle of the decade. We do this in part by eliminating waste and cutting whatever spending we can do without.

When you see the two together it doesn't really sound like there's much to argue about does it?

I wonder how the average American hears them? The Republicans are simply saying that cutting spending will grow the economy, full stop. Obama is saying that we need to cut spending but spend more for the future. Do they know the difference? And if they do, does it make sense to them?

I guess we're going to find out because the administration seems to be hooked on the idea that a message of cutting spending while also investing is something that people will instinctively understand --- and more importantly that cutting spending in order to raise spending will work. Unfortunately, in order to make that case they think they can make a splashy future deficit reduction plan along the lines of the cat-food commission stand in for their alleged dedication to spending cuts.

Once you've bought into the idea that reducing spending is the most important priority, it takes on a life of its own --- and unfortunately validates the idea that cutting spending immediately will stimulate the economy. But if you want it to actually grow, you can't actually do that. It's going to be quite a show.

[BeFree]

68. Cut spending?

That is exactly what home buyers have done. And many homeowners, too.

They cut out spending on a mortgage. They gave up. So then our economy crashed.

This "Cut Spending" is what the TP has as their economic policy?
Can't they see it leads to failure?

[Demeter]

2. 7 Reasons Why the Mortgage Crisis Is Dragging Down the Entire Economy MUST READ

http://www.alternet.org/story/150462/7_reasons_why_the_mortgage_crisis_is_dragging_down_the_entire_economy?page=entire

The mortgage crisis in this country doesn't get much attention in Washington these days, but it's huge. It's so huge, in fact, that it dwarfs most of the economic issues that have Washington in their grip. It's so huge that it's dragging down our entire economy. It's so huge that the numbers can be difficult to picture.

The scale of the crisis is, in a word, staggering.

Here are seven charts (and another that was borrowed from the Wall Street Journal) along with some facts and figures that will help sketch out the scope of the problem. The numbers that follow are most likely understated, if anything, because we've left out some forms of reduced spending (like that which takes place when homeowners who have paid off their mortgages lose home value.)

The budget cutters push the idea that there's a dichotomy between the heart and the brain, and that they're on the "brain" side. But the numbers don't lie: Ignoring the foreclosure crisis is both heartless and brainless.




Here's a fact for you: The amount of wealth American homeowners have lost over the least three years is much larger than this year's entire Federal budget.

Even our conservative estimate shows that the debt that homeowners are paying off to the banks for no-longer-existing home value - "money for nothing" - is greater than the entire projected Federal deficit for 2011. MORE AT LINK

[Demeter]

3. I know how he feels--I feel this way about the weather

People ask me what I do in winter when there's no baseball. I'll tell you what I do. I stare out the window and wait for spring. ~Rogers Hornsby

[Demeter]

4. Documents shed light on Fed lending practices

http://www.washingtonpost.com/business/economy/documents-shed-light-on-fed-lending-practices/2011/03/31/AFcbIlCC_story.html

The New York office of Bahrain-based Arab Banking Corp. borrowed $1.1 billion from the Fed’s emergency lending program for banks during October 2008, according to the documents. That bank is currently 59 percent owned by the Libyan Investment Authority, which invests money for the government of the Middle Eastern state now enmeshed in conflict. (At the time, Libya was making slow progress at mending its relationship with the United States and other Western governments.)

“It is incomprehensible to me that while creditworthy small businesses in Vermont and throughout the country could not receive affordable loans,” said Sen. Bernard Sanders (I-Vt.) in a statement Thursday, the Fed was extending credit “to a bank that is substantially owned by the Central Bank of Libya.”


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Baseball (AND BANKING) is the only field of endeavor where a man can succeed three times out of ten and be considered a good performer. ~Ted Williams

[Demeter]

5. Fed Releases Discount-Window Loan Records During Crisis Under Court Order

http://www.bloomberg.com/news/2011-03-31/federal-reserve-releases-discount-window-loan-records-under-court-order.html

...The central bank has never revealed identities of borrowers since the discount window began lending in 1914. The Dodd-Frank law exempted the facility last year when it required the Fed to release details of emergency programs that extended $3.3 trillion to financial institutions to stem the credit crisis. While Congress mandated disclosure of discount-window loans made after July 21, 2010 with a two-year delay, the records released today represent the only public source of details on discount- window lending during the crisis...

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I'm convinced that every boy, in his heart, would rather steal second base than an automobile. ~Tom Clark

WITH EXCEPTION FOR THE BANKSTERS!

[Demeter]

6. Fed Kept Taps Open for Banks in Crisis

http://online.wsj.com/article/SB10001424052748704530204576235213193119194.html?mod=dist_smartbrief

....The disclosures include loans made by the Fed from August 2007 to March 2010. The period includes the darkest moments of the crisis, including the September 2008 collapse of Lehman Brothers Holdings Inc. Lehman's weekend tumble into bankruptcy ushered in unprecedented U.S. intervention to prop up the teetering financial markets and deepened the panic already spreading through banks and securities firms around the world.

When discount-window lending peaked at $110 billion on Oct. 29, 2008, European banks Dexia SA and Depfa were the biggest borrowers. Dexia took $26.5 billion that day, while Depfa Bank, a subsidiary of German Hypo Real Estate Group, took out $24.6 billion. In the following weeks, the banks accessed the discount window nearly daily for tens of billions of dollars.

A spokeswoman for Dexia said in an email that the information disclosed by the Fed is "backward-looking" and "our outstanding with the Fed was reduced to zero."

A Depfa spokesman said the company hasn't "been using the window since May 2010." Depfa and its parent company got more than €100 billion ($142 billion) in support from the German government...

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A (baseball game) BANKING CRISIS is simply a nervous breakdown divided into nine innings. ~Earl Wilson

[Demeter]

7. JPMorgan in talks to end SEC marketing probe

JPMorgan Chase is in settlement talks to end a US regulator’s inquiry into how the bank marketed a mortgage-linked security as the credit markets descended into crisis, people familiar with the matter say.

The lender’s discussions with the US Securities and Exchange Commission could produce an agreement within weeks, these people say. A settlement would resolve for JPMorgan one of the many regulatory headaches that have dogged Wall Street in the wake of the crisis. The SEC and JPMorgan declined to comment.

Read more >>
http://link.ft.com/r/5F39HH/JI4HLD/YGZ3O/8AG9ZL/YHREPF/KI/t?a1=2011&a2=4&a3=1



I see great things in baseball. It's our game - the American game. It will take our people out-of-doors, fill them with oxygen, give them a larger physical stoicism. Tend to relieve us from being a nervous, dyspeptic set. Repair these losses, and be a blessing to us. ~Walt Whitman

IN OTHER WORDS---A DISTRACTION!

[Demeter]

8. Majority of Experts Predict Government Shutdown

http://www.thefiscaltimes.com/Articles/2011/03/30/Majority-of-Experts-Predict-Government-Shutdown.aspx?utm_source=The+Fiscal+Times+Latest+News&utm_campaign=134ead77ef-Latest_News_from_The_Fiscal_Times_03_30_11&utm_medium=email

So just how long can the federal government continue to stagger along without a budget before hitting a political brick wall and shutting down? A significant majority of Washington budget and policy experts surveyed by The Fiscal Times said they expect a government shutdown of at least a few days after the latest stop-gap spending measure expires late next week.

David Stockman, the former Reagan administration budget chief and one of 36 experts polled this week, declared: “It’s time for the Republicans to man up and let it burn! Discretionary spending is out of control, and if the GOP doesn’t force a big roll-back, they should have their mouths washed out with soap for lying about no new taxes.”

The government has been operating under a series of fiscal 2011 continuing resolutions for the past six months – the budgetary equivalent of holding things together with bubble gum and bailing wire. Unless President Obama, GOP congressional leaders and top Senate Democrats can cut a deal for the remainder of the year, it looks as if we will finally confront a shutdown beginning midnight next Friday.

Or at least that’s the verdict of a distinguished panel of budget and political experts, lobbyists, columnists and journalists assembled by The Fiscal Times. They were asked this week to respond “Yes” or “No” to whether the Obama administration and congressional leaders are coming to the end of the line and will risk the political repercussions of forcing the first government shutdown since late 1995 and early 1996, during the Clinton administration.

The results: Twenty-two of the 36 Washington experts surveyed (61 percent) said they expect a government shutdown of at least a few days, while 14 of them (39 percent) said the politicians will pull out a last-minute deal to avert a shutdown....


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Baseball CONGRESS is a fun game. It beats working for a living. ~Phil Linz

[Demeter]

9. TARP’s $24 Billion Profit: Some Demand a Recount

http://www.thefiscaltimes.com/Articles/2011/04/01/TARP-Profit-Success-Questioned.aspx?utm_source=The+Fiscal+Times+Latest+News&utm_campaign=aa7b166261-Latest_News_from_The_Fiscal_Times_04_01_11&utm_medium=email

The Treasury Department is crowing about a new analysis that claims the government’s massive bank bailout in response to the 2008 financial crisis will actually end up turning a profit of nearly $24 billion.

Treasury Secretary Timothy Geithner said that while the government’s overriding objective was to “break the back of the financial crisis and save American jobs,” it didn’t hurt that the TARP investments in U.S. banks “delivered a significant profit for taxpayers.”

But whether the government’s Troubled Asset Relief Program will ultimately end up in the black or red is still an open question. And the Obama administration has been slammed by congressional Republicans and some financial experts for restoring Wall Street to profitability through TARP while millions of homeowners continue to struggle with foreclosures and more than 13 million people remain unemployed.

Outgoing Treasury Special Inspector General Neil Barofsky has said the administration mismanaged TARP and failed to accomplish some key goals; he pointed out that some of the largest banks that were deemed “too big to fail” are now 20 percent larger than before the crisis.

Critics say that the intervention will end up encouraging banks to grow much larger than is prudent and that this will ultimately benefit wealthy Wall Street investors rather than Main Street homeowners. In particular, the Home Affordable Modification Program has failed to make a significant dent in the number of mounting home foreclosures across the country.

"Claims of TARP's profitability are premature. The taxpayer will likely still take losses on TARP's housing programs," Sen. Richard Shelby, R-Ala., said at a recent hearing. "What matters most is TARP's negative long term impact on the overall economy, which will dwarf any profit generated, if there is any. On that basis, TARP's record has not been good for American families."...

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When they start the game, they don't yell, "Work ball." They say, "Play ball." ~Willie Stargell, 1981

[bhikkhu]

71. I would think the net economic effect would be very worthwhile

...in holding up a few points of GDP, and keeping many thousands in the workforce, and therefore supporting economic activity that in itself becomes local, state, and federal tax revenue.

[Demeter]

10. Vermont’s Single-Payer Salvation

http://inthesetimes.org/article/7052/vermonts_single-payer_salvation/


...On February 8, newly inaugurated Democratic Gov. Peter Shumlin unveiled his plan for a publicly funded single-payer healthcare system, which was introduced into the state’s legislature. If enacted, which appears likely, it will be the first system of its kind in the United States and Vermont would become the first state to abolish most forms of private health insurance...Last year, lawmakers passed a bill to hire a team of consultants led by Hsiao—an economist who helped to develop universal healthcare plans in China and reform Medicare and Medicaid in the 1970s—to design a new healthcare system for the Green Mountain State. According to Hsiao’s research, about 32,000 people, or roughly five percent of the state’s population, would still be uninsured after federal reform measures take full effect in 2014. (Fifty seven thousand, or 9 percent, of Vermonters are currently uninsured.)...What Hsiao and his team ended up recommending to the state was a single-payer system that would ensure coverage for all residents. An independent public body would oversee the system and contract out administration of all claims. Private insurers could compete for this work, as they have done for years to administer the state’s Medicare program. The bill, currently in committee, would take an estimated three to six years to implement.


The introduction of the healthcare bill comes in the first months of Democratic Gov. Peter Shumlin’s first term in office, which follows eight years of Republican rule under Gov. Jim Douglas. Shumlin supported a single-payer healthcare system during his campaign, calling Vermont’s current system “broken.” Anya Rader Wallack, the special assistant to Shumlin on healthcare, cited waste and “craziness” as factors troubling the state’s current healthcare system during testimony before Vermont House and Senate committees on February 8. Three private insurance carriers operate in Vermont, along with Medicare and Medicaid and various suppliers of workers’ compensation insurance, a structure Wallack called “misguided.”

Dr. Deborah Richter, president of Vermont for Single Payer, which has advocated for a new health system since 2003, says that “on the whole” the group supports Hsiao’s plan. “Estimates are that Hsiao’s system will not only be able to cover everybody, but for less money,” Richter says. “Vermont is uniquely poised to get this done.”

The state cannot “get this done,” however, unless it receives a waiver from the federal government to bypass the federal reform legislation. Shumlin thinks that won’t be a problem; Vermont’s entire congressional delegation—Sens. Bernie Sanders (I) and Patrick Leahy (D) and Rep. Peter Welch (D)—support the single-payer effort and introduced a measure to allow states to receive waivers from federal reform requirements as soon as 2014, as long as they cover as many uninsured people as federal law would. (They currently have to wait until 2017.) On February 28, President Barack Obama told state governors he would support the earlier date.

Hsiao seems optimistic. “I can say with full confidence that your broken system can be fixed,” Hsiao counseled Vermont lawmakers. “But we require you to…adopt the right solution.”

[Demeter]

11. Half a Million People Descended on London to Protest Corporate Tax Dodgers "This Is Economic Treason

http://www.alternet.org/economy/150398/half_a_million_people_descended_on_london_to_protest_corporate_tax_dodgers_%22this_is_economic_treason!%22/?akid=6744.227380.zjzYVM&rd=1&t=1

....Meanwhile, in the United States protesters gathered in 40 cities on Saturday to oppose tax cuts for the wealthy amid budget cuts to public services. We broadcast a video report from the streets of London and speak to British journalist Johann Hari and Allison Kilkenny of Citizen Radio in New York.

SEE VIDEO AT LINK

When we played softball, I'd steal second base, feel guilty and go back. ~Woody Allen

[Demeter]

12. We've Become a Nation of Takers, Not Makers (WELL, WSJ SUBSCRIBERS, FOR SURE)

http://online.wsj.com/article/SB10001424052748704050204576219073867182108.html

More Americans work for the government than in manufacturing, farming, fishing, forestry, mining and utilities combined...

If you want to understand better why so many states—from New York to Wisconsin to California—are teetering on the brink of bankruptcy, consider this depressing statistic: Today in America there are nearly twice as many people working for the government (22.5 million) than in all of manufacturing (11.5 million). This is an almost exact reversal of the situation in 1960, when there were 15 million workers in manufacturing and 8.7 million collecting a paycheck from the government.

It gets worse. More Americans work for the government than work in construction, farming, fishing, forestry, manufacturing, mining and utilities combined. We have moved decisively from a nation of makers to a nation of takers. Nearly half of the $2.2 trillion cost of state and local governments is the $1 trillion-a-year tab for pay and benefits of state and local employees. Is it any wonder that so many states and cities cannot pay their bills?

Every state in America today except for two—Indiana and Wisconsin—has more government workers on the payroll than people manufacturing industrial goods. Consider California, which has the highest budget deficit in the history of the states. The not-so Golden State now has an incredible 2.4 million government employees—twice as many as people at work in manufacturing. New Jersey has just under two-and-a-half as many government employees as manufacturers. Florida's ratio is more than 3 to 1. So is New York's.

Even Michigan, at one time the auto capital of the world, and Pennsylvania, once the steel capital, have more government bureaucrats than people making things. The leaders in government hiring are Wyoming and New Mexico, which have hired more than six government workers for every manufacturing worker...


NEED SOME CHEESE TO DO WITH THAT WHITE WHINE? WHOSE FAULT IS IT THAT THE MANUFACTURING JOBS WENT OVERSEAS?

I don't want to play golf. When I hit a ball, I want someone else to go chase it. ~Rogers Hornsby

[Demeter]

13. Having A Job May Not Be Enough To Make Ends Meet Millions 'underemployed,' group claims

http://www.consumeraffairs.com/news04/2011/04/having-a-job-may-not-be-enough-to-make-ends-meet.html

The nation's unemployment rate dipped slightly in March to 8.8 percent, as the economy added more than 200,000 jobs during the month.

But despite the improvement, a new report says millions of Americans are struggling to make ends meet, and we're talking about people who have jobs.

A group called Wider Opportunities for Women (WOW) has developed a formula that suggests the average single worker needs to earn $30,012 a year - nearly twice the federal minimum wage - to cover basic expenses. Single parents require nearly twice the income ($57,756) to support two children, while dual-income households with children require $67,920.

IF I EVER HAD THAT MUCH INCOME WHILE RAISING THE TWO KIDS....

[Demeter]

14. Texas Cops Ticket Thousands of Schoolchildren to Raise Revenue, Some as Young as 6-Yrs-Old

http://www.informationliberation.com/?id=34820

This is how low your government will go. Cops in Texas have been writing thousands of tickets to schoolchildren for $250-$500 each for the "crime" of "misbehaving in school" so the government can raise revenue. This has been going on now for over five years...

[plumbob]

66. Our local school district actually pays to have a municipal court judge

officed at the local detention to speed up processing these kids' fines.

The judge's salary is wholly paid by the district out of these proceeds. The payoff? About $11 in fines for every dollar of overhead.

[Demeter]

15. AND NOW, FOR SOMETHING COMPLETELY DIFFERENT: Obama Receives Transparency Award at Secret Meeting

http://www.thenewamerican.com/usnews/politics/6927-obama-receives-transparency-award-at-secret-meeting

On Monday President Obama received an award for transparency, which ironically was given to him during a closed, unannounced meeting. Bestowed upon the President from a group of transparency advocates, the ceremony took place in secret, even though — as of two weeks ago — it was supposed to be open to the press.
According to Politico, the meeting was “inexplicably postponed” and rescheduled without notice for Monday “without disclosing the meeting on public schedule or letting photographers or print reporters into the room.”

Those present at the ceremony, which took place in the Oval Office, included Gary Bass of OMB Watch, Tom Blanton of the National Security Archive, Danielle Brian of the Project on Government Oversight, Lucy Dalgish of the Reporters Committee for Freedom of the Press, and Patrice McDermott of OpenTheGovernment.org.

[snot]

69. Note, one commenter apparently assumed the story's an April Fool's joke.

[DemReadingDU]

16. Cincinnati - The Big Red Machine

The Big Red Machine is the nickname given to the Cincinnati Reds baseball team which dominated the National League from 1970 to 1976, recognized as among the best in baseball.<1><2> Over that span, the team won five National League Western Division titles, four National League pennants, and two World Series titles.<3> The team's combined record from 1970-1976 was 683 wins and 443 losses, an average of nearly 98 wins per season.

The nickname was introduced in a July 4, 1969 article by Bob Hertzel in The Cincinnati Enquirer,<4> but gained prominence in reference to the 1970 team,<5><6><7><8> which posted a regular season record of 102-60 and won the National League pennant.<9> Rookie and future-Hall of Fame manager Sparky Anderson headed the team,<10> which at its peak featured Pete Rose, Johnny Bench, Joe Morgan and Tony Pérez, and was supported by George Foster, César Gerónimo, Ken Griffey, Sr., and Dave Concepción.<11> The eight players most frequently referenced as members of the Big Red Machine include baseball's all-time hit leader in Rose;<12> 3 Hall of Fame players in Bench, Peréz and Morgan; 6 National League MVP selections; 4 National League home run leading seasons; 3 NL Batting Champions; 25 Gold Glove winning seasons, and 63 collective All-Star Game appearances.<13> The starting lineup of Bench, Rose, Morgan, Pérez, Concepción, Foster, Griffey, and Gerónimo (collectively referred to as the "Great Eight") played 88 games together during the 1975 and 1976 seasons, losing only 19.<14>

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

[OhioChick]

17. Thanks for posting this weekly....

I always look forward to reading this thread. You do a great job and I appreciate the time you spend on posting this. :)

[Demeter]

19. Thank you for the supportive language

I did wonder where everybody was, for a while....

Next Friday is Euchre night, so I will be late starting...but meanwhile, PLAY BALL!

[Demeter]

18. Bank Risk Breaking Back of Irish Government: Roubini

http://www.cnbc.com/id/42371902

Recapitalizing Irish banks would be bad if done with government money, because it would affect the country's ability to fund itself even further, Nouriel Roubini, chairman of Roubini Global Economics, told CNBC on Friday.

Late on Thursday, Ireland revealed results of stress tests on its banks, saying they need a further 24 billion euros ($34.11 billion) in capital, in line with market expectations. Ireland's government could pay 17.5 billion euros to recapitalize its banks while the European Central Bank and the Irish Central Bank will also contribute to the funding, finance minister Michael Noonan told parliament, according to Reuters.

But Roubini said a better solution, although not agreed by European Union officials, would be to convert the debt into equity, as the last round of recapitalization may be insufficient.

"I'm not sure that it's going to be enough and putting all the losses of the banks on the balance sheet of the government and eventually breaking the back of the government … it's not the right solution," Roubini said in an interview from the Ambrosetti Forum in Italy. "They cannot keep on socializing losses and eventually having sovereign risk becoming banking risk and banking risk becoming sovereign risk, that's not the right approach."

[Demeter]

20. Class Warfare Scoreboard : Guess Who's Winning? By Mike Whitney

http://www.informationclearinghouse.info/article27811.htm

...because consumption is 70 percent of GDP, so if the consumer is on the ropes and getting pummeled by stagnant wages and inflation at the same time, then you can bet the economy is headed for the dumpster. Of course, a good portion of the blame for this mess goes to Ben Bernanke whose miracle QE2 elixir has kept the stock market bubbly while commodities and food prices have skyrocketed. That's the real source of the problem, an uneven policy that rewards the investment class while leaving the workerbees (you and me) fending off soaring prices.

Bernanke says we shouldn't worry about the higher prices because core inflation is still low. (roughly 1%) That's easy to say for guy who's never filled his gas tank in his life, but for everyone else inflation is a killer that forces them to cut their spending or shed more debt, neither of which is easy to do.

So, yes, personal consumption has gone up, but only by a hair. The truth is, people are running harder just to stay in the same place. They're not making any headway at all. In fact, this whole myth about credit-addled shoppers going crazy at Macy's so they can load up on designer jeans and Italian leather boots, is pure bunkum. For most people, it's a hand-to-mouth existence 24-7. Most of their time is spent figuring out how they can stretch the budget or feed a family of four on pinto beans and Velveeta. They don't have the doe for luxuries, unless you consider Spam a luxury.

Of course, the reason for this is that all the gains from worker productivity in the last 30 years have gone to management. The front office rakes in the golden ducats while the workers get a pat-on-the-head and a "see ya later, Charlie". It's the same everywhere. Take a look at this in the WSJ:

"Consider that back in 1970, wages, salaries and employee benefits accounted for about three-quarters of total U.S. personal income as measured by Commerce. Dividend, interest and rental income contributed about 14%, while government-backed benefits, including disability, unemployment and welfare, were less than 8% of the total.

That changed in the ensuing decades as government programs expanded, the population aged and wealth disparities increased. By 2005, salaries, wages and benefits were about 67% of the total. In 2010, they dropped to 64%. Meanwhile, the shares of total income from dividend, interest and rental income and, especially, government benefit payments increased....

Unfortunately, the dwindling share of wage income fits with the broader erosion of the U.S. middle class. Roughly 40% of consumer spending these days is generated by the upper fifth of households. UniCredit economist Harm Bandholz notes that the share of U.S. consumption financed by labor income has steadily declined to about 61% today from 85% in 1970." ("Income Gains Not Lifting All Boats", Kelly Evans, Wall Street Journal)

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When you're in a slump, it's almost as if you look out at the field and it's one big glove. ~Vance Law


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WHITNEY CONCLUDES: The only way to level the playing field is by ripping it up and starting over.

[Demeter]

21. No pent up demand around here

http://www.economist.com/blogs/freeexchange/2011/03/consumer_spending

EVEN as Fed officials tout this year's economic pick-up, forecasters are furiously marking down their first quarter growth numbers. Julia Coronado of BNP Paribas has some charts nicely illustrating why the economy stubborningly refuses to exhibit a recovery-like bounce. Here's one of them:



As Ms Coronado nicely puts it:

While consumers are spending, as shown in the chart above, there has been no sign of pent up demand. Real consumer spending on goods fell off its pre-2008 trend line during the recession and has since resumed its former pace with no indications that a surge in spending to make up for lost time is imminent.

The burst of spending in Q4 was bound to be followed by some moderation with or without higher food and energy prices. The tax of higher inflation robbed consumers of the benefits of the payroll tax cut and has left their confidence shaken, which appears to be producing a greater than anticipated moderation. If firms keep adding jobs, this will prove to be a nothing more than a slow patch.

Nonetheless rising headline inflation has naturally put central bankers a little on the defensive, and they are vulnerable to seeming out of touch by citing abstract measures of core inflation or the lack of higher prices on Ipads. Yet it is relatively straightforward that a burst of headline inflation that does not emanate from wages is likely to be self-destructive.

In other words, don't worry about inflation until you see it in wages. With unemployment around 9%, I'm not holding my breath.

[Demeter]

22. Nick Clegg: Britain's proposed nuclear plants may not be built

http://www.telegraph.co.uk/earth/energy/8415028/Nick-Clegg-Britains-proposed-nuclear-plants-may-not-be-built.html

The Deputy Prime Minister cast doubt on the future for nuclear power by predicting that a review into existing plants – ordered after the explosion at the Fukushima power station — would recommend higher and more costly safety standards.

The Liberal Democrat leader insisted that no extra government money would be found to meet additional costs and suggested that energy firms would struggle to raise investment from the private sector as a result of the Japanese near-meltdown.

His remarks, made in a briefing to journalists on a visit to Mexico, throw into doubt the future of Britain’s energy supply.

The Government has given provisional approval to the building of at least 10 new nuclear reactors, costing around £50 billion each, at eight sites as part of the pledge to cut carbon emissions by 80 per cent in coming decades. Experts have cast doubt on the capacity of the oil, gas and coal sectors to fill the energy gap if the 19 existing reactors are not replaced as they age over the next decade...

[Fuddnik]

23. Rick Scott went to the Rays home opener today.

Got his ass booed out of the stadium.

Same thing at a Yankees pre-season game a couple of weeks ago.

[Demeter]

25. Excellent!

Now, to get the cockroaches out of the governors' mansions.

[Demeter]

24. 1.8M 'distressed' homes could weigh on home prices for years

http://www.usatoday.com/money/economy/housing/2011-03-30-distressed-homes-shadow-inventory.htm

...Market researcher CoreLogic said Wednesday that the shadow inventory had shrunk slightly the past year, from 2 million homes in January 2010...

AT 200,000 FORECLOSURES-SHORT SALES/YEAR, NINE MORE YEARS OUGHT TO DO IT...

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Good pitching will beat good hitting any time, and vice versa. ~Bob Veale, 1966

[Demeter]

36. Housing Market Blues The bleeding continues By Mike Whitney

http://www.informationclearinghouse.info/article27784.htm

...Who will buy a house in this market knowing that the same house might be cheaper tomorrow by tens of thousands of dollars? So, why has Fed chairman Ben Bernanke focused all his energy on the financial markets? Indeed, $600 billion in monetary stimulus has sent stocks into the stratosphere rising nearly 15 percent in just 3 months, but what about the underlying economy where wages are frozen, 14 million people are out of work, food stamp usage is at record highs, and the housing market is crashing? Bernanke is like the man who tries to fix his car by digging a hole in the back yard. It can't be done, because the two things are entirely unrelated. QE2 has been a bust for everyone excluding the bank Mafia that torched the financial system with their pernicious flimflam...

Prices are tumbling, inventory is mushrooming, and foreclosures are off-the-chart. Yes, the market can fix this problem by adjusting prices according to supply and demand, but that wasn't the standard Bernanke used with the banks. Oh, no. Bernanke purchased $1.7 trillion in garbage mortgage backed securities (MBS) to keep his shifty buddies from taking the hit. (And that was AFTER the $700 billion TARP) It just goes to show that "free market" solutions are always jettisoned when they don't meet the needs of the rich and powerful. The free market is just a stick that's used to beat up on little guys...

[Demeter]

26. AIG’s $15.7 Billion Bid for Maiden Lane Mortgage Bonds Rejected by NY Fed

I GOTTA WONDER WHAT'S IN THAT POLE OF HORSE MANURE THAT AIG WOULD WANT IT BACK...

http://www.bloomberg.com/news/2011-03-30/new-york-fed-declines-aig-s-offer-for-maiden-lane-ii-mortgage-bond-assets.html

American International Group Inc. (AIG), the bailed-out insurer, was rebuffed by the Federal Reserve Bank of New York in its bid to repurchase a portfolio of mortgage- backed securities for $15.7 billion.

The New York Fed will instead sell the assets individually and in blocks, the regulator said yesterday in a statement posted on its website. BlackRock Inc. (BLK), the New York Fed’s investment manager, will issue the first bid list next week, according to the statement.

“We had anticipated we would have the opportunity to buy these assets at a fair price by January 2011 and earn a return on them for the benefit of the U.S. taxpayer,” Mark Herr, a spokesman for New York-based AIG, said in an e-mailed statement. “Now, we must make up for lost time and lost earnings.”

AIG handed the mortgage bonds, known as Maiden Lane II, to the New York Fed in 2008 in exchange for a cash injection that helped save the company from collapse. The insurer, which sold non-U.S. businesses and returned to profit last year, said it was bidding for the securities to boost investment returns...The securities, backed by so-called subprime, Alt-A and other home loans, had a face value of about $39 billion when turned over to the Fed. The figure is now about $31 billion, after homeowners defaulted, moved or refinanced, according to AIG’s disclosures...

[Demeter]

50. NY Fed to AIG: thanks, but no

http://ftalphaville.ft.com/blog/2011/03/30/532151/ny-fed-to-aig-thanks-but-no/

...In light of improved conditions in the secondary market for non-agency residential mortgage backed securities (RMBS), and a high level of interest by investors, the Federal Reserve believes that conditions are right for ML II to begin more extensive asset sales while taking appropriate care at all times to avoid market disruption. In light of this decision, the New York Fed has changed the investment management objective for ML II consistent with such sales.

The New York Fed, through its investment manager, BlackRock Solutions will dispose of the securities in the ML II portfolio individually and in segments over time as market conditions warrant through a competitive sales process. There will be no fixed timeframe for the sales and at each stage the Federal Reserve will only transact if the best available bid represents good value for the public.

Offering the Maiden Lane securities for sale individually and in segments rather than as a single block will give a larger set of investors opportunity to bid for the assets. The Federal Reserve believes that this will maximize sale proceeds while also reducing the likelihood that any one institution ends up with concentrated exposure to these assets....

.

The New York Fed already publishes on its website a list of all the securities in its portfolio. In order to allow the public to track progress on asset dispositions, the New York Fed will provide monthly updates on portfolio holdings and a list of the securities sold within the prior month. In addition, it will provide quarterly updates on total proceeds from sales, and the total amount purchased by each counterparty. Finally, the New York Fed will provide further details regarding these transactions, including an account showing the acquirer and the price paid for each individual security three months after the last asset is sold, ensuring timely accountability without jeopardizing the ability to generate maximum sale proceeds for the public.

For more information visit Maiden Lane II LLC, including the most recent holdings report as of February 28th, 2011, visit Maiden Lane II LLC:

http://www.newyorkfed.org//markets/maidenlane.html#maidenlane2

[Demeter]

51. SURVIVAL OF THE Euro: It's all down to Timo Of Finland (sorry!)

http://www.bbc.co.uk/blogs/newsnight/paulmason/2011/03/euro_its_all_down_to_timo_of_f.html

WHEN EVEN THE BRITS ARE GETTING CATTY, YOU KNOW THERE'S DANGER AFOOT...

A short summary of the Euro snafu that's about to happen:

1) Tomorrow Ireland publishes the results of bank stress tests. It has to find - or the EU has to find - another E18-25bn to shore up its failing banks.
2) It goes to Brussels and demands what it asked for three weeks ago and failed to get: better terms, lower interest rates, greater forebearance from the bailout fund that is keeping its banking system alive (or I should say actively zombified)
3) Meanwhile in Lisbon they do the same, or try to - hampered only by the fact that the government just lost its parliamentary majority (and parliament may be dissolved Thursday).
4) Meanwhile, in Greece, beset by continued downgrades of their credit rating and declining prospects of being able to grow their way out of fiscal crisis, they join in the clamour for a more generous deal.
5) Meanwhile in Helsinki, voters go on ticking the box on opinion poll questionnaires that is marked "True Finn": Finland is stymied from putting up its share of the proposed bailout fund because parliament is dissolved: after 17 April, if the True Finns (leader, Millwall fan Timo Soini) join a coalition with the centre right, they may stymie the new mechanism full stop.
6) It all points towards the thing the EU leaders have been trying to head off since the December crisis: a chaotic default on peripheral debt, blowing apart the carefully crafted compromises that have allowed the interim bailout mechanism to work.
7) Then the question is - if Ireland, Portugal and Greece default - how much the governments of northern Europe are on the hook for? Because it is big European banks - in Spain, Germany, France and, oh, Britain - that will see their loans go up in smoke in any default...

[Demeter]

27. 'Suicide squads' paid huge sums amid fresh fears for nuclear site

http://www.independent.co.uk/news/world/asia/suicide-squads-paid-huge-sums-amid-fresh-fears-for-nuclear-site-2256741.html

The radioactive core in one reactor at Fukushima's beleaguered nuclear power plant appeared to have melted through the bottom of its containment vessel, an expert warned yesterday, sparking fears that workers would not be able to save the reactor and that radioactive gases could soon be released into the atmosphere.

Richard Lahey, who was a head of reactor safety research at General Electric when the company installed the units at Fukushima, said the workers, who have been pumping water into the three reactors in an attempt to keep the fuel rods from melting, had effectively lost their battle. "The core has melted through the bottom of the pressure vessel in unit two, and at least some of it is down on the floor of the drywell," he said.

The damning analysis came as it emerged that workers at Japan's stricken nuclear plant are reportedly being offered huge sums to brave high radiation in an attempt to bring its overheated reactors under control. The plant's operator, the Tokyo Electric Power Company, is hoping to stop a spreading contamination crisis which could see another 130,000 people forced to leave their homes.........

...Subcontractors to several companies connected to the plant have reportedly been offered 80,000 to 100,000 yen a day (£608 to £760) to join the operation, according to one former plant worker. The team of men inside the complex have been dubbed "samurai" and "suicide squads" in the popular press...

[Demeter]

28. The company chief who disappeared from view

It has been a bad fortnight for Masataka Shimizu. Tepco's beleaguered president has watched the value of the utility giant plummet by $29 billion since 11 March after investors wiped over 70 per cent off its stock.

Its share price of 696 yen is the lowest it has been since 1977 as it battles to stop nuclear catastrophe in Fukushima. The company's problems have just turned existential now that the government has begun openly discussing nationalisation.

Mr Shimizu, 67, has been largely absent from public view since the crisis detonated, appearing briefly on 13 March to issue a boilerplate apology for "causing trouble", then disappearing totally on 16 March, reportedly suffering from overwork.

Rumours in the Japanese press suggest he has suffered a breakdown or even left the country. The Washington Post noted this week that he has been missing crucial appointments with leading politicians. Other reports say he has holed up in his office and refused to join a joint government-Tepco crisis management team.

According to the Asahi newspaper, prime minister Naoto Kan told Mr Shimizu in his office on 15 March that it was "ridiculous" for him to have left his post. In another now famous outburst, a frustrated Mr Kan shouted at Tepco executives demanding to know "what the hell is going on".

Most observers believe it is only a matter of time before Mr Shimizu steps down, leaving the company he took over two years ago a smouldering ruin.

[Demeter]

35. Rainwater banned at water plants

http://search.japantimes.co.jp/cgi-bin/nn20110329a2.html

The health ministry has instructed water purification plants nationwide to temporarily stop taking in rainwater to prevent tap water being contaminated from radiation leaking from the crippled Fukushima No. 1 nuclear plant, ministry officials said Sunday.

While calling on the plants to keep tap water supplies stable, the Health, Labor and Welfare Ministry also proposed covering the water pools at the plants with tarps to keep rainwater out or using powdered activated carbon to help get rid of radioactive materials. The instruction came after abnormal radiation levels were found in tap water at multiple purification plants in Fukushima, Tokyo and other prefectures....

[Demeter]

37. When the Fukushima Meltdown Hits Groundwater

http://www.informationclearinghouse.info/article27788.htm

"HOTTEST" PREDICTIONS FOR THE IMMEDIATE FUTURE OF THE WORLD....CLICK ON LINK

[Demeter]

45. Exclusive: WANTED: U.S. workers for crippled Japan nuke plant

THE NUCLEAR EQUIVALENT OF CANNON FODDER...IS THAT ALL WE ARE GOOD FOR?

http://www.reuters.com/article/2011/03/31/us-japan-nuclear-us-idUSTRE72U84H20110331?pageNumber=1

A U.S. recruiter is hiring nuclear power workers in the United States to help Japan gain control of the stricken Fukushima Daiichi plant, which has been spewing radiation.

The qualifications: Skills gained in the nuclear industry, a passport, a family willing to let you go, willingness to work in a radioactive zone.

The rewards: Higher than normal pay and the challenge of solving a major crisis.

"About two weeks ago we told our managers to put together a wish list of anyone interested in going to Japan," said Joe Melanson, a recruiter at specialist nuclear industry staffing firm Bartlett Nuclear in Plymouth, Massachusetts, on Thursday.

So far, the firm has already signed up some workers who will be flying to Japan on Sunday.

Melanson said there will be less than 10 workers in the initial group. Others are expected to follow later, he added.

[Fuddnik]

52. Do they pay overtime if you live longer than expected?

:sarcasm: :sarcasm: :sarcasm:

Are there any chances for advancement?

Sign me up! This is a great opportunity. I can't buy life insurance, but I can get paid good money to commit assisted suicide.

[Demeter]

55. It Gets Better

Only the brightest lights in the nuclear industry get to "volunteer".

I guess things are tough all over, or their synapses are already scrambled by radiation exposure.

[Fuddnik]

60. sigh.....Nobody wants a dim bulb.

[AnneD]

74. I dunno.....

George W got elected twice. See! Anyone can grow up to be President of the Uniter States.

[AnneD]

75. Sorry

Duped. Like GWB's term.

[Demeter]

29. Governor Cuomo to New York's Poor and Middle Class: Drop Dead

http://www.informationclearinghouse.info/article27791.htm

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

It's hard to win a pennant, but it's harder losing one. ~Chuck Tanner

[Demeter]

30. How to Waste Money and Lives: The American Prison System

http://www.informationclearinghouse.info/article27798.htm

In 1970, fewer than 200,000 Americans were incarcerated. Today, with some 2.3 million in prison or jail, the US has more people and a higher percentage of its population locked up than any other country. Adding those on probation and parole, over seven million are under penal supervision. Although much of the growth stems from tougher drug laws, increased sentencing for most offenses has played a large role, too. According to criminologist Todd Clear, prison sentences in the US today average almost twice as long as thirty years ago. American prisoners now endure sentences twice those of the English, four times those of the Dutch, and five to ten times those of the French for the same crimes.

=========================================================================




Baseball is almost the only orderly thing in a very unorderly world. If you get three strikes, even the best lawyer in the world can't get you off. ~Bill Veeck

[Demeter]

31. NO BANKS FAILED TONIGHT: DAMN YANKEES!

Sheila must have had tickets for the Yankees-Tigers opener...

The Weekend's Theme came from this fact--the Tigers faced the Yankees Thursday (and lost).

A local public radio station played the overture to "Damn Yankees", flawed and dated Broadway musical...

with a book by George Abbott and Douglass Wallop and music and lyrics by Richard Adler and Jerry Ross. The story is a modern retelling of the Faust legend set during the 1950s in Washington, D.C., during a time when the New York Yankees dominated Major League Baseball. The musical is based on Wallop's novel The Year the Yankees Lost the Pennant.

Damn Yankees ran for 1,019 performances in its original 1955 Broadway production. Adler and Ross's success with The Pajama Game and Damn Yankees seemed to point to a bright future for them, but Ross suddenly died of chronic bronchiectasis, at the age of twenty-nine, a few months after Damn Yankees opened....

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

Plot

Note: This is the plot of the 1994 Broadway revival of the play; there are differences from the 1955 version. For the film version, see Damn Yankees (film).

Middle-aged real estate agent Joe Boyd is a long-suffering fan of the pathetic Washington Senators baseball team. His wife Meg laments this ("Six Months Out Of Every Year"). After Meg has gone to bed, Joe sits up late, grumbling that if the Senators just had a "long ball hitter" they could beat the "damn Yankees". "I'd sell my soul for a long ball hitter," he laments. Suddenly, "Mr. Applegate" appears. He looks like a slick salesman, but he is really the Devil, and he offers Joe exactly that deal: if he gives up his soul, Joe will become "Joe Hardy", the young slugger the Senators need. Joe accepts, even though he must leave his wife Meg ("Goodbye Old Girl"). However, Joe's business sense makes him insist on an escape clause. The Senators' last game is on September 25, and if he plays in that final game, he is "in for the duration". If not, he has until 9 o'clock that night to walk away from the deal and return to his normal life.

At the ball park, the hapless Senators vow to play their best despite their failings ("Heart"). Then Joe Hardy is suddenly discovered, and joins the team. Gloria, a reporter, praises him ("Shoeless Joe from Hannibal, Mo"). His hitting prowess enables the Senators to move up the standings.

Though Joe is increasingly successful, he truly misses his wife and begins boarding with her. Meg and the young man begin to bond, especially over her "lost" husband ("A Man Doesn't Know"). Fearful of losing his deal, Mr. Applegate calls Lola, "the best homewrecker on his staff", to seduce Joe and ensure his damnation. Lola promises to deliver ("A Little Brains, A Little Talent"), and Applegate introduces her as a sultry South American dancer named "Señorita Lolita Banana". Lola sings a seductive song ("Whatever Lola Wants, Lola Gets"), but Joe's devotion to his wife proves too strong, even for her. Applegate punishes her by sending her to hell, where she performs with other damned souls ("Who's Got the Pain").

Applegate decides to switch tactics to ensure Joe's failure. He releases false information about Joe Hardy's true identity being "Shifty McCoy," an escaped criminal and con artist. When Gloria discovers this information, she presses charges, and Joe is forced into court.

The Senators prepare for the final game against the Yankees for the pennant, and worry about Joe - but vow to think of nothing but winning ("The Game"). Meanwhile, angry fans are seeking Joe out, so he decides to leave the Boyd home. As he does, he tells Meg indirectly that he is her old husband ("Near to You"). Meanwhile, Applegate is exhausted by the work he has put into collecting one soul, and thinks about the "simpler" times in his long history ("Those Were the Good Old Days").

Joe's day in court is on the same day as the Senators' final game. As Joe Hardy technically does not exist, he cannot produce any kind of identification. The owner of the Senators, coach, and even Lola (disguised as "Senora McCoy") testify against Joe; unfortunately, their opinions are invalid. Gloria suggests that Applegate take the stand, but he is unable to take the oath due to its provision against lying. "Don't you have another version of that thing?" he asks. Joe realizes that Applegate is simply stalling to keep him from meeting his 9 o'clock deadline. Applegate claims that Joe "just needs time to think", and sends him to the lower levels of hell, where history's most famous lovers wait. Lola meets Joe there, and realizes that he truly does love Meg. She helps him by sending him into the final game, and delays Applegate by coercing him into a duet ("Two Lost Souls").

When Applegate finally arrives at the game, it is five minutes to nine, and Joe is at bat. As time runs out, Meg, her friends, and even Lola begin cheering for Joe. Applegate uses his powers to give Joe two strikes. The clock strikes nine, and Applegate claims victory—but at the last second, Joe cries, "Let me go!" The deal is broken, and he is transformed back into his old self. Amazingly, he is still able to hit a home run and win the Senators the pennant.

Back at home, Joe rushes into Meg's arms. Applegate appears on the scene, claiming that Joe owes him his soul. Joe begs Meg to hold him and not let go, and she begins to sing ("A Man Doesn't Know Reprise"). Applegate promises to make Joe young again, and even ensure a World Series victory. But his powers are useless against the pair's true love, which Lola points out. Applegate shouts that such a thing cannot exist - but he is wrong. He and Lola vanish back into Hell, defeated, with Joe and Meg united again forever.

[Demeter]

32. Damn Yankees

http://www.youtube.com/watch?v=yNZd7F8Y-Ys

The best part of Damn Yankees, the film, was unmistakably Ray Walston in the role of the Devil. He played the con with the smoothness he showed in his other roles: Luther in South Pacific, The Sting, My Favorite Martian. I had quite a crush on him, as a young girl...


damn yankees whatever lola wants gwen verdon

http://www.youtube.com/watch?v=96hC32WwfKw&feature=related


Damn Yankees - "Heart" (CTC)

http://www.youtube.com/watch?v=z88uOJRtq-I&feature=related

[Demeter]

33. Jim Carrey Tapped For 'Damn Yankees' Movie

http://www.starpulse.com/news/index.php/2009/02/27/jim_carrey_tapped_for_damn_yankees_movie

from 2009--wonder if it's ever coming out? It may not have been filmed yet--evidently it was still in negotiation a year ago...

[Fuddnik]

61. I saw that onstage in Cleveland. Jerry Lewis was the Devil.

Probably about 15 years ago.

[Demeter]

34. Morning Note: Gold Replacing Dollar as World’s Reserve Currency?

http://www.cnbc.com/id/42250806

Central banks are shedding dollars...What are they buying instead? Gold

[AnneD]

76. Quidaffi is one of the largest holders ...

Of gold. Puts a different spin on the war doesn't it.


Glenda Kwek
March 22, 2011
Ads by Google



Gaddafi's gold ... reportedly sitting on one of the world's top reserves.
The gold reserves are believed to have been moved from the central bank in the capital, Tripoli, to another city such as Sebha in the south, which is near Libya's African neighbours Chad and Niger, after fighting broke out, the Times reported.

While bankers told the Times that international banks or trading houses were unlikely to buy any gold believed to be from Libya, Colonel Gaddafi may find buyers in Chad or Niger.

"If a country like Libya wants to make their gold liquid it would probably be in the form of a swap – whether for arms, food or cash," Walter de Wet, the head of commodities research at Standard Bank, told the Times.

The price of gold has risen recently, fuelled by growing instability in the Middle East and North Africa.

"If the dollar remains weak and we get further unrest in the Middle East, there is a very reasonable chance for gold to test the record high," Darren Heathcote, head of trading at Investec Australia, told Reuters.

Ousted Egyptian dictator Hosni Mubarak reportedly used the 18 days of protests against his rule to move his fortune - estimated at up to $64 billion - to untraceable accounts in Western countries.

Other countries buying large amounts of gold include Iran, China, Russia and India, the Times said.

The United States holds the world's biggest gold reserves - 8965.6 tonnes, according to the World Gold Council.

Other countries with massive stockpiles include Germany with 3749.8 tonnes, China with 1161.9 tonnes, India with 614.8 tonnes and Venezuela with 401.1

[Demeter]

38. Tomorrow Happened Yesterday by Bill Bonner

http://dailyreckoning.com/tomorrow-happened-yesterday/

A shocking figure came out last week. In the US, fewer new houses were sold last month than in any month since they started keeping records in 1963.

How is it possible? Simple. The houses that would have been sold to today’s able buyers were built and sold years ago. That’s what excess credit does. It doesn’t really enlarge or enrich an economy…it stretches it, bringing things that would have happened tomorrow forward, to yesterday. Only a certain number of people every year can afford a new house. If in 2005, you give credit to buyers who won’t be ready for many years, or perhaps never – who will buy a new house in 2011?

By the time the bubble popped in ’07, there were few able buyers still looking. And then, a US federal tax credit program in the fall of ’09 and the first part of ’10 finished them off. That program expired a year ago. Housing has been an empty husk ever since.

The latest data show more remarkable developments in time travel. You have to see it to believe it. And even then, you rub your eyes and wonder. In the US, the financial sector is riding high. Again. After bringing the whole world economy to its knees three years ago, profits for the industry are back where they were before the crisis began 4 years ago. For every dollar of corporate profit made in the United States of America in 2011, nearly 30% comes from shuffling money.

A good bartender will stop serving a customer who is in danger of falling on his face. No such decency exists in finance.

Read more: Tomorrow Happened Yesterday http://dailyreckoning.com/tomorrow-happened-yesterday/#ixzz1IKqhaGAo

[Demeter]

39. A World of Leaks and Full Disclosures By Bill Bonner

A World of Leaks and Full Disclosures

By Bill Bonner

Read more: A World of Leaks and Full Disclosures http://dailyreckoning.com/a-world-of-leaks-and-full-disclosures/#ixzz1IKrUGwBy


BONNER TAKES UP STAND UP COMEDY...

[Demeter]

42. Tracing the Path of Social Upheaval Across the Middle East and North Africa

http://dailyreckoning.com/tracing-the-path-of-social-upheaval-across-the-middle-east-and-north-africa/#ixzz1IL0edeUE



...It is curious, then, that the various goings on in the Middle East (and North Africa...and Japan...and along Europe's periphery) barely inspire a whimper from the markets. Not even the scalawag shenanigans concocted in the oak-paneled halls of government buildings in Washington DC raise a questioning eyebrow from the mainstream media. The Dow Jones Industrial Average is still cruising, as if on autopilot, some 800 points above where it began the year. Neither manmade nor natural disasters seem capable of disturbing its terminally ascendant flight pattern...

[Demeter]

43. Broke in America: The Housing Meltdown Continues

http://dailyreckoning.com/broke-in-america-the-housing-meltdown-continues/

The Fed is bust - and that's not just my opinion

I'm serious. It may be the US central bank, but it's still a bank like all the rest.

Most of its assets are US government bonds, bought as part of its quantitative easing (QE) programmes.

Its liabilities include about $1 trillion of notes and coins in circulation. There are also $1.4 trillion of deposits owing to US commercial banks, which are required to hold reserves at the Fed. There are also some deposits owed to the US Treasury. And there's $53 billion in capital.

So the Fed can go bust just like any other bank. And I'm not the only one saying it. William Ford, a former president of the Atlanta Federal Reserve, one of the 12 member banks of the Fed itself, broke ranks to warn about it on 11 January.

Ford points out that the Fed can hide insolvency because it does not mark its assets to market. So we'll only know that it's bust when it sells some bonds. Only then would it have to take the losses from selling them for less than it paid.

Of course, the Fed going bust would be very embarrassing. So you can be sure it will be quietly bailed out behind closed doors. In fact, if the bailout is timed to coincide with the losses, we might not even notice.

Who will bail out the Fed?

Why does this matter to you? Well, guess who would rescue the Fed? The US Treasury, a department of the US government, would have to inject extra capital to restore solvency. But the US government is not exactly flush these days.

So how would they get the money? They'd issue more bonds. And the Fed would buy them as part of its QE programme.

So let's be clear. The Fed goes bust. So it lends money to the US government (i.e. it buys US bonds), and the US Treasury gives it back to the Fed as capital. So the Fed is printing money to bail itself out. What do you think this will do for investor confidence in the US government and the dollar?

I'm pretty sure that the value of US Treasury bonds and the dollar will be worth less afterwards.

[Demeter]

40. Dimon: About 100 US Local Governments Not Going to “Make It” By Rocky Vega

http://dailyreckoning.com/dimon-about-100-us-local-governments-not-going-to-make-it/#ixzz1IKrxqqjB

[Demeter]

41. The Real Victims of Fed Monetary Policy By Bill Bonner

http://dailyreckoning.com/the-real-victims-of-fed-monetary-policy/#ixzz1IKt3Yq4S


The Dow went up more than 70 points yesterday. The higher it goes, the more dangerous it becomes.

What's the matter with this downturn? Shouldn't it lower stock prices? Shouldn't it empty tables at fancy restaurants? Shouldn't it close down some of these luxury shops and make it easy to upgrade to business class?

Nah... The Great Correction is a failure. At least so far. It's correcting only the people at the bottom....At the upper income levels, there doesn’t seem to be much correction happening. And why should there be? The feds give them money.

Stocks have recovered most of their losses. Bonds – which should be worthless by now – still trade hands at par. Corporate profits are at record levels.

Where’s all this money coming from? You guessed it, the feds.

Read more: The Real Victims of Fed Monetary Policy http://dailyreckoning.com/the-real-victims-of-fed-monetary-policy/#ixzz1IKtImwiT

[Demeter]

44. OLIPHANT ON GE PAYING NO TAXES

http://imgsrv.gocomics.com/dim/?fh=fe2b60a11f0d8c5f7fe567bb8f168009&w=750.0

[Demeter]

46. The Real Reason Gas Prices Are Soaring By CHARLES WALLACE

Dan Dicker, who has spent nearly three decades in the oil market, has a profoundly disturbing explanation of why the price of oil, and the gasoline that comes from the crude product, has risen so dramatically in recent months. It turns out, Dicker says, that the price has nothing to do with supply and demand for oil. It's the financial market for oil, filled with both professional speculators and amateur investors betting on poorly understood oil exchange-traded funds, who have ratcheted up the price of gas to such sky high levels.

"There is no supply issue going on here - what you have is the perception of the possibility of a supply issue," Dicker says. "A whole bunch of people are pouring money into an oil market trying to take advantage of what they perceive to be a real risk in supply. It's a marketplace that I argue should not be allowed to be wagered on like a stock or bond."

Dicker notes that Libya produces only 1.3 million barrels of oil a day, just a tiny fraction of the world oil market. Even if Libyan crude were lost to the world market in the current turmoil, and there is no sign that it is, Saudi Arabia has 5 million barrels a day to use in case of an emergency.

Dicker, who has just published a book called Oil's Endless Bid: Taming The Price of Oil To Secure Our Economy, makes a strong case that if the government stepped in and regulated oil trading so that only investors with a genuine interest in the physical product, such as airlines and heating oil companies, could buy and sell oil futures, then the price of oil would fall by 50% overnight and our economy would be much better off.

See full article from DailyFinance: http://srph.it/h88hv4

[Demeter]

47. It’s SOS for the S.E.C.! Polite Mary Schapiro Polices the Plutocrats

http://www.observer.com/2011/daily-transom/its-sos-sec-polite-mary-schapiro-plays-good-cop%E2%80%93good-cop-policing-plutocrats

CATFIGHT! GOOD READ, TOO.

[Demeter]

48. Hooray! Jamie Dimon Says New Capital Rules Will Kill Zombie Banks!

http://www.nakedcapitalism.com/2011/03/hooray-jamie-dimon-says-new-capital-rules-will-kill-zombie-banks.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

ANOTHER CAT FIGHT! YAY YVES!

[Demeter]

49. JPMorgan's Dimon: No mortgage writedowns

http://money.cnn.com/2011/03/30/news/economy/jamie_dimon_chamber/index.htm

THE MAN'S BEEN GETTING A LOT OF PRESS LATELY--OPEN MOUTH ATTRACTING FLIES.

[Demeter]

53. Quelle Surprise! Fed Lent Over $110 Billion Against Junk Collateral During Crisis

ALTHOUGH THIS WAS POSTED ON APRIL 1ST, I'M AFRAID IT'S NO JOKE...

AND WE THE PEOPLE ARE THE APRIL FOOLS (NOT TO MENTION THE REST OF THE YEAR)

http://www.nakedcapitalism.com/2011/04/quelle-surprise-fed-lent-over-110-billion-against-junk-collateral-during-crisis.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

Former central banker Willem Buiter once remarked that the Federal Reserve’s “unusual and exigent circumstances” clause, which enables it to lend to “any individual, partnership or corporation” if it can’t get the dough from other banks, allows the Fed to lend against a dead dog if it so chooses.

It looks like the US central bank did precisely that...


The information was released yesterday and Bloomberg has provided a first cut on a small but juicy portion of it, the Primary Dealer Credit Facility. From a risk standpoint, the loans mace under this program violated the central bank guideline known as the Bagehot rule: “Lend freely, against good collateral, at penalty rates”. That is the prescription if the borrower is facing a bank run, meaning a liquidity crisis. The fact that 72% of the Fed’s loans on September 29 from the Primary Dealer Credit Facility were junk or equivalent (defaulted and unrated securities or equity) is further proof that many financial firms were facing a solvency, not a liquidity, crisis. The breakdown:

Equities comprised $71.7 billion, or 43.6 percent of the total. High- yield debt, including the defaulted issues, accounted for $18.4 billion, or 11.2 percent. Collateral of unknown rating was $28 billion, or 17 percent…..The U.S. central bank allowed borrowers to use $929 million in market-valued debt that had gone into default, rated D, as collateral on that day, 2008, more than the $905.5 million in Treasuries that were pledged…

And the haircuts were so low that the ideas that these were collateralized loans is a joke. The “collateralization” was a necessary legal fiction for throwing cash at anyone who thought they needed it:

The Fed loans on Sept. 29, 2008, represented a 5.49 percent “collateral cushion,” the amount by which the pledged assets exceeded the loan value….

To put things in perspective, the market haircut on most debt securities during the period of the crisis starting in September 2008 was above 40 percent,” Pirrong
http://www.bloomberg.com/news/2011-03-31/fed-accepted-more-defaulted-debt-than-treasuries-as-rescue-loan-collateral.html

A further remark: the fact that Bloomberg can say anything intelligent at this juncture is a testament to the cleverness of its reporters. The central bank quite deliberately responded to the request by providing the information in the most disaggregated, difficult to work with form imaginable. The central bank did a version of the same trick with its data on Maiden Lane II. The holdings of that asset management vehicle were various real estate exposures, some of which were hedged. The hedges were reported separately from the bonds and loans. Clearly, Blackrock, the asset manager, had far more useful and understandable reports that they used internally and provided to the New York Fed, but those were withheld. This data will presumably be as enticing as the Wikileaks cables, so enough eyeballs on it will eventually overcome the Fed’s efforts to hinder analysis.

[Demeter]

54. BUT WAIT! THERE'S MORE!

A separate Bloomberg story on the discount window operations found that 70% of the credit extended, including four of the five biggest users during the peak usage week, in October 2008, were foreign:

http://www.bloomberg.com/news/2011-04-01/foreign-banks-tapped-fed-s-lifeline-most-as-bernanke-kept-borrowers-secret.html

[Demeter]

56. AND IF YOU CALL RIGHT NOW..

Bank of China, the country’s oldest bank, was the second- largest borrower from the Fed’s discount window during a nine- day period in August 2007 as subprime-mortgage defaults first roiled broader markets. The Chinese bank’s New York branch borrowed $198 million on Aug. 17 of that month.

“It was just routine borrowing,” said Dale Zhu, head of the Bank of China New York branch’s treasury.

[Demeter]

57. BASEBALL WISDOM

No matter how good you are, you're going to lose one-third of your games. No matter how bad you are you're going to win one-third of your games. It's the other third that makes the difference. ~Tommy Lasorda



You don't save a pitcher for tomorrow. Tomorrow it may rain. ~Leo Durocher, in New York Times, 16 May 1965


You can't sit on a lead and run a few plays into the line and just kill the clock. You've got to throw the ball over the goddamn plate and give the other man his chance. That's why baseball is the greatest game of them all. ~Earl Weaver



During my 18 years I came to bat almost 10,000 times. I struck out about 1,700 times and walked maybe 1,800 times. You figure a ballplayer will average about 500 at bats a season. That means I played seven years without ever hitting the ball. ~Mickey Mantle, 1970

[Demeter]

58. Official: GOP Budget Would Kill 70,000 Children

http://thecable.foreignpolicy.com/posts/2011/03/31/shah_gop_budget_would_kill_70000_children

[plumbob]

67. Well, they're not the children of US millionaires, are they?

Thought not.

Carry on.

[Demeter]

59. In Local News...

The sun is shining, it's actually above freezing (and before 9 AM!), and likely to stay tolerable at least till Tuesday. Which means I have to stop WEE and get some useful work done...

After just over a month of custodial power, my sister has managed to get Dad's legs down to a reasonable size, with a complete and unbroken layer of new skin (probably only one cell thick) covering them, and a prescription for new glasses so he can see without headache. She is exhausted, but this is quite a triumph with a scared and stubborn and probably at least Aspbergers senior citizen. Furthermore, with on-site supervision, she can hold those gains and work on the rest...maybe even the gall bladder. Way to go, Sis!

Sis has never had anything more stressful than a sick puppy to care for. Now she knows what it's like. Speaking of which...

The Kid and I are taking our birthday party Sunday. We are taking the most significant people in the Kid's (and my) life to dinner at one of the many Japanese restaurants in town.

So I've got to get going. See you tonight!

[Demeter]

62. Could the U.S. be headed for a second sub-prime crash?

http://washingtonindependent.com/107135/could-the-u-s-be-headed-for-a-second-sub-prime-crash

The most succinct and uncontroversial explanation as to just how the recession began is that a massive surge in foreign capital in the early 2000s sent banks scrambling for investment opportunities and they found them by offering more loans to more people. This meant opening loans to consumers with a higher risk of not being able to pay them back — those being the sub-prime mortgages, which became a very familiar term in the early days of the recession. We’re still living through what happened next. And yet amazingly, data indicate that as corporations begin to recover, lenders in some markets are starting to return to the very pre-recession practices that created the crash in the first place...Approvals for sub-prime car loans have risen steadily since 2009 and are now at their highest rate since the recession hit, when lenders instantly became warier about approving loans for people with less than ideal credit scores. New data from automotive market research firm CNW show that sub-prime approvals in March are up more than 28 percent over where they stood in March of last year. The average credit score of consumers approved for auto loans has been shrinking accordingly every month since the first quarter of 2010.

Of course, sub-prime loans are not an inherently bad thing. Many consumers, from college students with limited credit histories to people who fell behind on bills during the recession after losing their jobs, may have low credit scores without actually posing a risk of defaulting on loans. Indeed, sub-prime financing is the only path to car or home ownership for many people. The problem comes when banks are too loose about whom they offer credit to and consumers are too confident about their ability to repay loans. If the auto loan trend continues unabated, the country may just be headed for more economic fallout.

Looking back at the recession years offers the best view of the problems easy credit can create. At first glance, auto loan delinquency rates (PDF) of the last five years seem to point to better times ahead. The number of people past due on auto loans has dropped significantly since an all-time high at the end of 2009. But this doesn’t necessarily mean a healthier consumer...Those delinquency rates — at an all-time high in 2009, followed by a sharp drop — are just a part of the auto financing picture, which is further explained by more of CNW’s research on sub-prime auto loans. Using CNW data, the New York Times reported last month on sub-prime loans dating back to before the recession. As with mortgages, sub-prime financing for cars reached historical peaks in 2006 and 2007. Then the American economy started to tumble, and by the end of 2008, not only had car sales overall taken a huge hit, but sub-prime financing was being extended to virtually no one.

Meanwhile, a Ford Motor Company credit bureau report (PDF) states that repossessions on outstanding loans reached an all-time high of 2.12 percent in 2009 — an increase of more than 60 percent from the 2006 rate.

What to make of all this? Transunion Credit Bureau’s loan delinquency rates follow CNW’s sub-prime rates, on about a two-year delay. Sub-prime credit saw a massive increase leading up to 2006, then a huge cutback between mid-2007 and late 2008, before slowly crawling back up. Loan delinquencies saw a steady increase leading up to 2008 before tumbling in 2009. By the second half of 2010, they were on the rise again. And then there are the repossessions. After reaching their all-time high in 2009, they’ve started to drop down...It seems, then, that there’s a correlation between sub-prime credit and, a year or two later, people falling behind on their loans. When they fall behind enough, they default and their cars get repossessed — an echo of the sub-prime mortgage bubble burst. Restrictions on sub-prime credit and terminations of outstanding loans may simply mean that the people who still have loans to pay are already financially more stable consumers — and that making credit easier to obtain will just start the cycle all over again.

While lenders and consumers alike have hailed the loosening of credit restrictions as a “return to normal,” only time will tell if “normal” is just a prologue to another sub-prime crash.

[Demeter]

63. The Reform That Wasn’t

http://opinionator.blogs.nytimes.com/2011/03/30/the-reform-that-wasnt/

From the outset of the recent financial crisis, the government’s often-haphazard response was motivated by an overarching desire to re-establish the status quo on Wall Street as quickly as possible. The thinking seemed to be that the sooner the surviving big banks got back on their feet and returned to providing the grease that keeps the wheels of capitalism churning, the sooner the broader economy beyond Manhattan would recover from its serious malaise and businesses would take the steps necessary to hire new workers — reducing a stubborn 10 percent unemployment rate — and to invest capital in new plants and equipment.

Not only did the government’s theory fail in practice — unemployment remains relentlessly and historically high and American businesses seem intent on hoarding, rather than spending, the $2 trillion in cash on their collective balance sheets — but it also lost a once-in-a-century opportunity to change the mores of a momentarily chastened Wall Street, which remains badly in need of substantive reform. This is more than a shame; it is prima facie evidence of how deep Wall Street’s hooks have been — and continue to be — into the powers that be in Washington (and vice versa). For instance, for all its bluster and heft, the July 2010, 2,200-page Dodd-Frank law, which purports to force Wall Street to change its bad behavior, has of course done nothing even remotely close to that and merely reinforced the longstanding cozy relationships. Rest assured, while you are reading this column, Wall Street’s lobbyists and executives are busy cozying up to regulators at the Securities and Exchange Commission, the Federal Reserve, the Federal Deposit Insurance Corporation and others to make sure the regulations still being written in the wake of Dodd-Frank come out just the way they want them. Despite the hype, that law was yet another triumph for powerful forces determined to return the Wall Street/Washington axis to the status quo.

Not surprisingly, the surviving Wall Street firms could not be happier with this outcome. While business may not exactly be booming on Wall Street these days — even Wall Street cannot claim to be immune from continuing unrest in the Middle East and the Japan disasters — it is certainly healthy, albeit less so (thankfully) in some of the more exotic and controversial securities that helped propel the financial crisis. And because of the demise of firms like Bear Stearns, Lehman Brothers, Wachovia and Washington Mutual, competition among the survivors is much diminished, to their delight. Debt and equity markets have all but recovered from the financial crisis and companies are taking advantage of the artificially low interest rates to issue billions of new debt securities at previously unthinkable long-term rates. The so-called “junk bond” market has rallied to levels not found since the height of the previous bubble in 2005 and 2006, with the usual corresponding deterioration in credit quality and restrictive covenants. The equity valuation of “social networking” companies such as Facebook, Groupon and Zynga have pretty much exceeded the absurd levels reached in during the Internet bubble of a decade ago and none of these companies has even gone public yet!

MORE AT LINK--JUICY GOSSIP!

[Demeter]

64. PARALLELS TO BASEBALL

Sandy's fastball was so fast, some batters would start to swing as he was on his way to the mound. ~Jim Murray, on Sandy Koufax


I was such a dangerous hitter I even got intentional walks in batting practice. ~Casey Stengel, 1967

[Demeter]

65. Excuses, Excuses, Excuses By JOE NOCERA

http://www.nytimes.com/2011/04/02/opinion/02nocera.html

Whenever the world’s greatest investor gets in a tight squeeze, he straps on his angel wings, readjusts his halo, and leans on his reputation for avuncular straight talk to make the problem go away...Warren Buffett did it in the early-1990s, when one of his holdings at the time, Salomon Brothers, was caught in a Treasury bond scandal. He did it in the mid-2000s, when executives at General Re, owned by Buffett’s company, Berkshire Hathaway, were prosecuted for concocting a phony transaction with A.I.G.

Now he’s doing it again as he attempts to gloss over the actions of a close associate that look suspiciously like insider trading. The deputy, David Sokol, resigned earlier this week, claiming he wanted to concentrate on his “philanthropic interests.” (That’s what they all say.) The resignation, said Buffett, came as a “total surprise.” (They all say that, too.)

In a statement, Buffett laid out the facts about Sokol’s stock purchases of Lubrizol, a company Berkshire Hathaway agreed to buy two weeks ago. To give Buffett his due, this is decidedly not what chief executives usually do in this circumstance. That’s why the Oracle of Omaha has such a glowing reputation in the first place. But the statement also contains a sentence that only Buffett would have the chutzpah to write:

“Neither Dave nor I feel his Lubrizol purchases were in any way unlawful.”

Yeah, well, Raj Rajaratnam has said he didn’t do anything unlawful either — and he’s being prosecuted for insider trading. No matter how pure Buffett believes Sokol’s heart is, it shouldn’t prevent the government from investigating this case. either. Yes, it’s possible that there’s an innocent explanation. But based on what we know so far, it smells to high heaven.

Let’s recount the story, shall we? MORE AT LINK

[Po_d Mainiac]

70. And how bout them Mets

:rofl:
Mets Owners Owe $300 Million: Madoff Trustee

http://www.nbcnewyork.com/news/local/Mets-Madoff-Documents-to-Be-Made-Public-Shortly-Sources-115288419.html

As the New York Mets open their 2011 season on Friday, questions about the team's future go well beyond the playing field. The Mets reportedly lost $50 million last year, and they have confirmed taking an emergency loan from Major League Baseball. On top of that, the trustee representing the victims of disgraced financier Bernie Madoff is suing the Mets' owners for $1 billion. The Mets' owners are trying to sell a minority stake in the team, but observers say that may not be enough.

http://www.npr.org/2011/04/01/135047878/n-y-mets-face-serious-financial-problems

[AnneD]

72. Thanks for the baseball topic.....

We are awash in the final four here in Houston, but my heart belongs to baseball. There is no more satisfying sound than the crack of a WOODEN bat hitting a ball (sorry that ping just doesn't work for me). My daughter got the baseball gene from both sides of the family and I can share many a funny story. We she was little I was still dirt poor, going to school, single mom, dead beat dad, etc. One of our cheapest but fun entertainment was to watch the little league games at a near by field. We were so broke that we had to bring our own snacks or picnic basket with us. But even as a toddler of two, she would focus on the game. We cheered both sides and she always melted hearts when she did her little stadium victory dance. I have such fond memories of her sitting in my lap, watching intently as I explained the rules. And no outing was complete until she would try to hit a ball with her oversized bat and run around the bases as Mommy tried to tag her. Those were such golden moments. Made for a happy healthy childhood.

I am such a baseball nut I think I own every baseball movie there is. Of course, no one does better in a baseball movie than Kevin Costner. I think it is because he played it in HS and college. He has a love for it and it shows.

Field of Dreams...Kevin is great but James Earl Jones steals every scene that is not nailed down. It is so eloquent and speaks to the love of the game.

The Natural...baseball meets King Arthur. The end scene where he runs the bases while the stadium lights explode like fireworks is visual poetry.

Bull Durham...best combination of Americas two favorite sports. I still laugh at the conference on the mound. Best line...Honey, all women deserve to wear white on their wedding day.

Love of the Game...one of the more realistic love and relationship stories. When he has nothing left to give, his friends and family lift him up and Karma takes over.

Sandlot...a great baseball movie for kids and kids at heart. My daughter loved this one, especially the story of Hercules.

League of Their Own...Madonna does baseball. It was great. Speaks to the difficulty of getting womens sports off the ground in this country. Individual womens sports have faired better than team sports, and that is a shame.

Pride of the Yankees...Gary Cooper, Yankee Stadium, bring a hankie with you.

The Babe Ruth Story....again, bring a hankie. This was the first baseball movie I remember watching. Big baseball heroes have big hearts. If I had my way, the next baseball movie made would be about Roberto Clemete or Willie Mays

[AnneD]

73. I am having trouble

Editing. I was also going to add Jackie Robinson to the list of baseball players needing a Hollywood makeover. In fact the entire Negro League is chocked full of athletes that have a wonderful story to tell.

AnneD...Cubs fan (and Astros too).

[Demeter]

78. Thanks for the Sports Posts, AnneD!

This topic seems to be a real hit (you should pardon the pun)!

Both the Kid and I loved A League of Their Own--done without any glaring anachronistic behaviors or gimmicks.

By the way, Good luck on your candidacy! You and Tansy could do no worse (and probably 1000 times better for less money) than the current Administration.

[Demeter]

77. THEATRE REVIEW

I had the most unpleasant experience of seeing a performance of Richard III, the Dick Cheney version.

For some reason, modern male actors and producers feel obliged or permitted to inject as much homoerotic, sado-masochistic violence and gore as possible into everything they attempt. I can't tell if it's mockery or depravity. But it was certainly disgusting.

Richard III had enough tension and implied violence to make it a difficult play to perform or watch. Shooting fake blood around the stage, beating fake bodies with clubs, didn't add anything. Instead, it detracted from the characters.

The Kid and I slept through most of the first act, woken by Clarence shooting at the top of his lungs trying to rouse something from the audience....we left at intermission.

Well, what can one expect for free tickets--

[Demeter]

79. WEATHER UPDATE

It's been showering on and off. One could almost say "April Showers" except for the tendency for the droplets to freeze...

In the shadowy places, plowed and piled up snow still sits, hardened to ice, granular and gray. The air temperature has never gotten high enough to melt it, and the freezing rain doesn't do the job, either. Spring is going to be rather cold, this year.

[Demeter]

80. How You Can Pull a GE on Taxes FROM YOUR FRIENDS AT WSJ

http://online.wsj.com/article/SB10001424052748704530204576235090332473366.html?mod=WSJ_myyahoo_module

FIRST, GET ENOUGH INCOME TO BE ELIGIBLE TO PAY TAXES...


There's been a firestorm this week over the news that General Electric will pay no tax—at least, no federal corporate income tax—on last year's profits.

But if you're like a lot of people, your first reaction was probably: "Hmmm. How can I get that kind of deal?"

You'd be surprised. You might. And without being either a pauper or a major corporation.

I spoke to Gil Charney, principal tax researcher at H&R Block's Tax Institute, to see how a regular Joe could pull a GE. The verdict: It's more feasible than you think—especially if you're self-employed....

[Demeter]

81. Chad Stone Statement on January Employment Report

http://www.cbpp.org/cms/index.cfm?fa=view&id=3443

A PICTURE'S WORTH A THOUSAND WORDS--IF YOU WANT THE WORDS, GO TO LINK!

[Demeter]

82. JESSE OF Jesse’s Café Américain ON Concentration of Wealth & Power Is the Root Problem

http://www.chrismartenson.com/blog/straight-talk-jesse-concentration-wealth-power-root-problem-our-economy/54416?utm_source=newsletter_2011-04-02&utm_medium=email_newsletter&utm_content=node_title_54416&utm_campaign=weekly_newsletter_12

Stagflation has been my forecast for quite some time as the most likely outcome, with a real protracted deflation or hyperinflation as lesser probabilities.

The reasoning behind this is fairly straightforward. In a fiat monetary regime, the central banking authorities license the shadow banking system to create money through their credit expansion mechanisms. There is a money multiplier, or a natural credit expansion, in a normal growth economy. In the event of a recession due to a business cycle, the Fed can relax reserve requirements and interest rates through their open monetary operations, essentially lowering the standard for credit creation, also known as the interest-rate hurdle, for a profitable return.

In the event of a financial crisis or a credit collapse such as the one in which we are now, the Fed has the ability to monetize existing and new government debt by purchasing it at extraordinary (non-market) prices, adding it to its balance sheet. Additionally, the ability to pay interest on bank reserves gives them a little more fine control on the effects, and even keeping some liquidity out of the system by paying banks to retain a greater amount than they ordinarily would, and raising the bar a little on interest rates. People also forget that the Fed has always had the power to set reserve and margin requirements. This extraordinary monetization effort by the Fed requires a significant amount of cooperation from bondholders and those external entities who hold dollar assets in their currency reserves.

The problem, of course, is that the Fed is only a part of the bigger picture. It is the responsibility of the Congress and the Executive to set fiscal and regulatory policies for the country and the real economy, including import export, jobs, taxation, and so forth. Today, the government, both the Executive and the Congress of both parties, is presiding over a broken system, made so by a relatively tight coterie of monetary interests who have been promoting an outsized, over-dominant financial sector, and the undermining financial regulation since the early 1990's.

I think a particular event occurred around 1996-7 which I have referred to in the past as a 'financial mystery, a coup d'etat.' I prefer not to speak of it more now, but it involves US government officials and China, and Clinton's chief financial people Greenspan and Rubin. It was at roughly the time of Greenspan's 'irrational exuberance speech,' after which he shortly changed his tune and began the expansion of the money supply, which culminated in the tech bubble...

[Demeter]

83. THAT'S A WRAP, FOLKS

I'm too full of tempura and strawberry pie. We had a nice party, and I have quadrupled the number of orchid plants in my collection. the Kid has enough jewelry to open her own branch of Tiffany's (if they ever go into junk jewelry).

The misery of the weather continues....