Weekend Economists: MayDay! April 29-May 1, 2011

[Demeter]

So, Is it May Day, or Mayday? Let's hear the arguments on both sides:


Typical Maypole used in folk festivals



May Day Poster for International Workers Day.



Really funky poster--historical and hysterical interest

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

First, Mayday! It's an international radiotelephone signal word used by aircraft and ships in distress.

Where did that convention come from? Before my research, I thought it might be a corruption of the French "merde" or "oh, shit!". I wasn't that far off...


From French (venez) m'aider, (come) help me!.

---http://www.answers.com/topic/mayday

How Does One Properly Use The Mayday?

After fishing around for the answer, we discovered that a mayday distress call is used only in cases of "grave and imminent danger." The correct way to signal mayday consists of three repetitions of the word mayday, then the name of the boat, and its radio call sign. Once this initial message is transmitted, a follow-up message should be transmitted that includes the word mayday again, as well as the boat's position, the nature of the emergency, number of persons aboard, and any other relevant information to assist a rescue effort.

But what's with the word "Mayday"? Well, we quickly learned that it has nothing to do with the observance of May Day, the ancient pagan planting festival and international working class holiday. So, what does it mean?

We found a page called Origins of Hamspeak that explained that "mayday" is an anglicized version of the French m'aidez (help me) or m'aider (to render help to me). In addition, a lengthy thread devoted to this meaning of mayday can be found in the online archive of the Quiznet Gang.

A paper on distress communications describes the historical evolution of an international distress radio frequency for ships and aircraft. In 1927, the International Radiotelegraph Convention of Washington adopted the word "Mayday" as the radiotelephone (RT) distress call, although it was not until 1932 that the International Telecommunications Convention of Madrid changed from earlier frequency standards and established 1650 kHz as the international RT distress frequency. A variety of other frequencies are still used and monitored by Coast Guard and naval radio personnel. Current instructions from a variety of maritime agencies worldwide suggest transmitting on VHF channel 16, or HF 2182.0 KHz.

A word of advice for boaters -- print out a copy of distress procedures and leave it alongside your vessel's radio equipment in case of emergency. Roger. Over and out.

---http://ask.yahoo.com/20011218.html

-------------------------------------------------------------------------------
Last year around this time, we extensively explored the International Workers Holiday....I will spare us all the agony of repeating it.

And then, there is the Spring festival of planting, fertility, etc. I'd wax poetical on it, if Michigan was experiencing anything like Spring, 6 weeks after the Equinox....as it is, I try not to go through more than a box of kleenex per day. B vitamins help a lot....

So this weekend we will consider the mayday/May Day dichotomy. Which will our nation, our people choose? The international cry for help, or the Workers of the World, or just mindless procreation? Your postings, relevant or not, are welcome here. There is only one requirement: be informative, or be entertaining. Bonus points for posts that are both.

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

As mentioned in SMW this week, I will be running away from reality, partying, doing on-the-ground research into various topics at an RG for the weekend. Weekend Economists will leap into the breach (I hope). See you intermittently!

[Demeter]

1. UK Hospitals told to look for 50% more savings

NHS hospitals will need to make savings at least 50 per cent higher than previously required, raising questions over whether they will fundamentally have to change the way services are delivered, according to leading health commentators

Read more >>
http://link.ft.com/r/8P1R88/72OWM8/Z87P0/KE41KC/3OLHY7/B7/t?a1=2011&a2=4&a3=28

THANK YOU, MARGARET THATCHER. YOUR ATTEMPTS TO DEFUND THE WELFARE STATE HAVE BORN INCREDIBLE FRUIT....AND SPREAD AROUND THE WORLD TO THE US

[Demeter]

2. US economic growth slows to 1.8%

The US economy grew at an annualised rate of 1.8 per cent in the first three months of the year as rising prices took a toll on consumer spending.

Preliminary figures from the Bureau of Economic Analysis showed growth slowing from the 3.1 per cent rate in the fourth quarter of 2010. The rise was slightly below the 2 per cent rate expected by economists.

Read more >>
http://link.ft.com/r/S4XZQQ/HD4SZG/XBAN6/ZB37X2/9Z60EG/T3/t?a1=2011&a2=4&a3=28

THAT'S A MAYDAY, IF EVER I SAW ONE...

[rfranklin]

14. Just a temporary hiccup...the Fed is still pumping free money into the banks...

and any day now fabulous jobs will be created and our economy will reach orgasm courtesy of the invisible hand of the market!

[Demeter]

15. Hey! Happy Mayday!

Thanks for the post! You forgot this: :sarcasm:

[Demeter]

3. India shuns US in $11bn fighter deal

India has shortlisted European jet fighters over US rivals in an $11bn competition to supply the Indian air force with advanced combat aircraft to modernise its ageing fleet.

The battle to supply India with 126 multi-role fighter jets is one of the world’s largest military contracts, and is fiercely contested by European, US and Russian companies.

Read more >>
http://link.ft.com/r/2SRI11/A7VKQT/IEP5S/QFI86T/RNE91Q/FW/t?a1=2011&a2=4&a3=28

[Demeter]

6. US lobbying fails to mask fighters' flaws

India resists strong US lobbying over $11bn fighter contract, saying it is putting technical factors above wider strategic interests in its overseas relations

Read more >>
http://link.ft.com/r/J0VG55/A7VY4O/MJTKN/YHN72A/3OLH3P/UP/t?a1=2011&a2=4&a3=29

[Demeter]

4. Japanese production suffers record fall

Japanese factory output suffered a record decline in March as the devastating tsunami crippled supply chains across the world’s third-largest economy.

The government said production plummeted 15.3 per cent in March from February, the biggest decline since records began in 1953, and worse than analysts had expected. Household spending dropped 8.5 per cent from a year earlier.

Kaoru Yosano, the economy minister, described the production figure as a “stunning statistic”, according to the Nikkei newspaper.

But Mr Yosano said the supply chain recovery – “a matter of life and
death” – would be faster than expected because companies were “working day and night” to recover.

Read more >>
http://link.ft.com/r/M2ZOXX/18TC5L/Z87P0/RNE8AT/RNEYA8/PJ/t?a1=2011&a2=4&a3=28

[plumbob]

21. "worse than analysts had expected"

WTF did they THINK would happen with no electricity to run huge numbers of plants? That the production fairy would just make shit and leave it under the tree?

Who ARE these anal-ists who do seem to have their heads firmly up their asses? They are always surprised, shocked, finding the unexpected and so on.

Ah, well, I'm sure they make a better living than I do.

And that doesn't shock or surprise me at all.

[Demeter]

23. It's Just that the Japanese Raised Denial to an Art Form

Long before Reagan started the trend here.

[Lucky Luciano]

32. If they predicted a drop of 30%, then the 15% drop

would be a better result than expected and you would not have made the same post because there was not enough doom.

[plumbob]

37. I'm pretty sure the numbers are rosied up as much as possible, anyway.

Working in the banking, insurance, and energy industries for 3 decades made me realize quickly that these folks often lie even when they don't need to.

They have contempt for their customers, adore themselves, and depend on the government to bail them out in the eventuality of any problems they create.

[Demeter]

5. Stocks gain as Fed holds rates steady

US stocks immediately recovered their losses for the session after the US Federal Reserve said it would keep rates at 0.25 per cent, and that it would end its quantitative easing programme as planned in June.

All eyes and ears will remain on Big Ben on Wednesday, as traders look ahead to the inaugural press conference by Ben Bernanke in two hours.

The Fed in its statement continued to say that the recovery is “moderate”, and that inflationary pressures are still weak, with pressures from energy and other commodities labelled as “transitory”.

Few expect any fireworks from the Fed chairman when he speaks at 19.15 BST. But there are lingering hopes that while confirming the end of the QE2 bond purchases in June, Mr Bernanke might leave the door open to “QE2.5”, in which the Fed reinvests any proceeds from maturing debt.

Read more >>
http://link.ft.com/r/5F39HH/6V6A8T/LSLXF/IYM3RE/D4V0YN/OS/t?a1=2011&a2=4&a3=27

THIS IS MORE LIKE PLACING BETS ON THE DECK OF THE TITANIC...QE2.5, ISN'T THAT JUST TOO CUTE FOR WORDS?

[Demeter]

7. Berkshire eyes legal action against Sokol

Warren Buffett’s Berkshire Hathaway is considering legal action against David Sokol, Mr Buffett’s heir-apparent until his surprise resignation last month

Read more >>
http://link.ft.com/r/NA70KK/6V6MYZ/K91WR/S3Q6Y2/NSKXS1/AZ/t?a1=2011&a2=4&a3=28

IT'S NOT WISE TO MESS WITH THE MISER OF OMAHA....

[Demeter]

8. Recent OFAC Actions

http://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Pages/20110426_33.aspx

Page Content
On April 26, 2011, OFAC issued General License No. 5 pursuant to Executive Order 13566 of February 25, 2011, "Blocking Property and Prohibiting Certain Transactions Related to Libya" ("E.O. 13566"). General License No. 5 authorizes U.S. persons to engage in transactions with or involving Qatar Petroleum or the Vitol group of companies related to oil, gas, or petroleum products exported from Libya under the auspices of the Transitional National Council of Libya (the "TNC"), provided that neither the Government of Libya nor any other person whose property and interests in property are blocked – with the exception of Arab Gulf Oil Company ("Agoco"), as an entity operating in areas controlled by the TNC and under the auspices of the TNC – receives any benefit from such transactions.

Also on April 26, OFAC issued a Statement of Licensing Policy establishing a favorable licensing regime through which U.S. persons can request from OFAC specific authorization to trade in hydrocarbon fuel (i.e., oil, gas, and petroleum products), as well as authorization to support or facilitate the trade in such hydrocarbon fuel, to the extent that such hydrocarbon fuel is exported under the auspices of the TNC. U.S. persons also can request specific licenses to engage in transactions related to the production of oil, gas, and petroleum products in areas controlled by the TNC.

IN OTHER WORDS...OIL FOR GUNS

[Demeter]

9. Michigan’s “Emergency” Financial Regime: What Fascism Looks Like By Glen Ford

http://www.informationclearinghouse.info/article27980.htm

Fascism is not all about jack-boots and guys with mustaches. It is a system of economic and social control. The particularities of fascism in any given nation grow out of the special dynamics of that country. Fascism in the United States will be blow-dried. And its legal and bureaucratic form will take shape in places like Michigan, where an innocuous sounding piece of legislation called the Local Government and School District Fiscal Accountability Act is the prototype for a host of laws designed to make government – the state – a compliant tool for the dictatorial rule of the most predatory sections of the ruling class. In 2011 America, that’s Wall Street, finance capital.

Michigan’s law allows the state to appoint emergency managers to nullify contracts, including labor agreements – which is what has unions upset. But the scope and intention of the law is much deeper and wider than simply anti-union. The legislation allows emergency managers to nullify the powers and authority of local governments of all kinds. One of its supporters gave the game away when he spoke of the need to impose a kind of “financial martial law” in which all pretense of democracy would be abolished in targeted communities. The community the Republican politician had in mind was Detroit, the Black metropolis, where the public schools were promptly put under emergency state control. But there is nothing to stop the state from abolishing democratic governance in any of Michigan’s cities, if an emergency can be declared or created. On April 15, the mostly Black city of Benton Harbor, the poorest jurisdiction in the state, was placed under total financial martial law, its citizens suddenly made more powerless than Blacks in Selma, Alabama, prior to the civil rights movement.

Fascism always requires an “emergency,” a “crisis,” to justify the surrender of whatever citizen liberties previously existed. Its mass organizing principle revolves the “Other” – the scapegoating of a hated group that can be blamed for the emergency. Historically, in the United States, that “Other” has been Black people – although other “Others” have been added to the list. The U.S. has always been fertile ground for fascist politicking – in fact, I have long maintained that White Terror under southern Jim Crow was a peculiar form of American fascism....Fascism is also associated with militarism and the national security state, which are certainly familiar aspects of modern Americana. More importantly, the militarization of the inner cities has been an established fact since the mid-1960s. The proof is in the one million African Americans behind bars.

The “crisis” that justifies the outright abolition of democracy – beginning, of course, in Black America – is the crisis afflicting finance capitalism. Wall Street then imposes instant emergencies on the larger society by starving cities and schools and the public sector in general, in order to strip down, privatize and commodify every asset in sight. Michigan's fascist model will doubtless be duplicated across the nation, as Wall Street moves to rule directly, through its emergency managers, by one name or another. The permanent emergency has begun.

A LOCAL MAYDAY....

[Demeter]

10. Keiser Report: Fleeing Dollar Flood & Fraud By Max Keiser

http://www.informationclearinghouse.info/article27975.htm

VIDEO REPORT AND TRANSCRIPT

MAX TAKES CREDIT FOR SILVER'S RISE...

[Demeter]

11. Can We Give The Hyperinflation-thing a Rest? By Mike Whitney

http://www.informationclearinghouse.info/article27968.htm

The Federal Reserve is not going to push the economy into Zimbabwean hyperinflation. That's pure bunkum. The Fed's plan is to weaken the dollar to boost exports and to force China to let its currency appreciate to its fair-market value. The policy should help to lower the US's bulging current account deficit. By purchasing $600 billion in US Treasuries (QE2), the Fed effectively reduces the supply of risk-free assets, which sends investors into riskier assets like stocks and commodities. Is there an element of class warfare in the policy? ...You bet, there is. It's a direct subsidy to the investment class while workers are left to face higher prices on everything from gasoline to corn flakes. It's a royal screwjob. But while Ben Bernanke may be a prevaricating class warrior and a charlatan, he's not insane. He's not going to print the country into Wiemar-type oblivion or shower the nation with increasingly-worthless greenbacks like they were confetti. Even so, that's the kind of blabber that one reads on the Internet every day. It's just baseless scaremongering from people who don't know what they're talking about.

..............................

Memo to Inflationists: The economy is dead. Not moving. Not breathing. Dead. Yes, the Fed can tie QE strings around the hands and feet and make them move like a marionette, but it's all make-believe. Without the props and the support-system, the economy would drop to its knees, gasp for air, and expire. Dead.

Have you noticed that 1st Quarter GDP has been revised-down to 2 percent and could be headed lower still? (Maybe even negative!) Have you noticed that unemployment is stuck at 8.8 percent and underemployment at 16.2 percent with more people falling off the rolls and into abject poverty every day? Did you see that manufacturing is starting to slip and "the production index, a key measure of state manufacturing conditions, fell from 24 to 8, indicating slower growth in output." Do you realize that the downturn in housing is getting more ferocious even after falling steadily for 5 years straight? Have you considered the fact that the government and Fed have pumped trillions of dollars of monetary and fiscal stimulus into the financial system with just about nothing to show for it? And, do you know why? Because we're in a Depression and the economy is pushing up daisies, that's why.

It's ridiculous to wail about "money supply" when velocity is zilch. It's pointless to crybaby over "bank reserves" when people are broke. It's crazy to yelp about "printing presses" when lending is down, credit is contracting and the economy is mired in the most vicious slump in 80 years. We're in a liquidity trap where normal monetary policy doesn't work. This is old territory, Keynes figured it out more than 60 years ago. But because Bernanke is so much smarter than Keynes, we get to relearn it all over again. Now that QE2 is ending, the verdict is in. And what have we learned? That monetary policy doesn't work in a liquidity trap. What a revelation!

MORE...



WELL, THIS IS WHERE MIKE WHITNEY AND I GO SEPARATE WAYS...HE MAY BE RIGHT IN THE SHORT TERM, BUT WHAT ABOUT NEXT YEAR, OR AFTER THE ELECTION?

[bread_and_roses]

26. I can't follow the treasuries stuff

- I freely admit, I'm just too lazy to even try to understand it. It also is several levels of abstractness beyond what I can deal with - an artificial construct (money) being artificially manipulated to "create" more artificial "wealth" that exists only on a computer somewhere ....

However, I'm glad you guys do.

But this strikes me as spot-on - (the Brit expression is the one and only nod from me on the Royal wedding, the hoopla over which I find truly staggeringly revolting - why not just have the peasants knuckling their foreheads while their Lords toss a few coins into the crowd?)

anyway, no quarrel here with this - at least for those below the top 1-5%:

The economy is dead. Not moving. Not breathing. Dead...Without the props and the support-system, the economy would drop to its knees, gasp for air, and expire. Dead. ... we're in a Depression and the economy is pushing up daisies...

And, I'm not even sorry it is so - no growth, I mean. $5 gas, I mean. The earth can't afford any more "growth." If it takes $10 or $20 gas to force change in our insane habits, so be it. Nothing else has worked. Most of the environmentalists sold out to the Corps long ago. The public wants to think that if they buy poison labeled "green" it won't kill them.

[Demeter]

12. Thrifty Families and Other Lies Like Their Government, Americans Live on Debt By Ted Rall

http://www.informationclearinghouse.info/article27974.htm

....
Americans are up to the ears in debt.

Four out of five individuals have at least one credit card. The average family has an outstanding balance of $10,700. It spends 21 percent of its monthly income to pay interest on that balance.

The average American family has assets: It owns a house worth $160,000. But it owes $95,000 to the bank. As the housing market continues to crash, equity shrinks.

Our average family's savings are virtually nonexistent: $3,800 in the bank, no retirement account whatsoever (for half of families, average retirement savings $35,000 for the other half), no mutual funds, no stocks, no bonds.

The claim that American families live within their means is a joke.

To be fair, it's not entirely their fault. The typical American family only earns $43,000. It's hard to buy much of anything, much less the house that embodies the American Dream, with that. And it's impossible to save.
....

MORE

[Demeter]

13. His Conclusion:

The typical American family cannot live within its means because it cannot earn enough to sustain its lifestyle. Were it to downgrade its living standards to a level it could afford, there wouldn't be enough consumer spending to drive the economy. This would force further personal austerity. Eventually we'd all be living outside.

You know what's funny? Unlike the American family, the U.S. government can spend less than it earns. It can increase revenues by raising taxes. Unlike families, it spends trillions of dollars on stuff--wars--that it doesn't need and actually makes things worse.

It could even use its power to force employers to pay workers what they deserve. If the government did that, families might not need credit.

They could (finally) live within their means.

[Demeter]

16. Libya: It’s Not About Oil, It’s About Currency and Loans By John Perkins

OUR FAVORITE ECONOMIC HIT MAN CHECKS IN...

http://www.informationclearinghouse.info/article27967.htm

....
We listen to U.S. spokespeople try to explain why we’re suddenly now entangled in another Middle East war. Many of us find ourselves questioning the official justifications. We are aware that the true causes of our engagement are rarely discussed in the media or by our government.

While many of the rationalizations describe resources, especially oil, as the reasons why we should be in that country, there are also an increasing number of dissenting voices. For the most part, these revolve around Libya’s financial relationship with the World Bank, International Monetary Fund (IMF), the Bank for International Settlements (BIS), and multinational corporations.

According to the IMF, Libya’s Central Bank is 100% state owned. The IMF estimates that the bank has nearly 144 tons of gold in its vaults. It is significant that in the months running up to the UN resolution that allowed the US and its allies to send troops into Libya, Muammar al-Qaddafi was openly advocating the creation of a new currency that would rival the dollar and the euro. In fact, he called upon African and Muslim nations to join an alliance that would make this new currency, the gold dinar, their primary form of money and foreign exchange. They would sell oil and other resources to the US and the rest of the world only for gold dinars.

The US, the other G-8 countries, the World Bank, IMF, BIS, and multinational corporations do not look kindly on leaders who threaten their dominance over world currency markets or who appear to be moving away from the international banking system that favors the corporatocracy. Saddam Hussein had advocated policies similar to those expressed by Qaddafi shortly before the US sent troops into Iraq....

MUCH MUCH MORE

[Fuddnik]

17. Kick and Rec!

Mayday! Mayday!

When fascism gets going here, we bellyache and fly a couple of flags upside down.

In other countries, they turn the whole place upside down. It's time to bring back The French Revolution Severance Package.

[DemReadingDU]

18. +++

[burf]

19. Five banks down so far!

Community Central Bank, Mount Clemens, MI
The Park Avenue Bank, Valdosta, GA
First Choice Community Bank, Dallas, GA
Cortez Community Bank, Brooksville, FL
First National Bank of Central Florida, Winter Park, FL

And the night is still young!

Good evening to all!!!

Source: FDIC

[Pale Blue Dot]

20. 5 banks down tonight!

April 29, 2011
These links contain useful information for the customers and vendors of these closed banks.

Community Central Bank, Mount Clemens, MI
The Park Avenue Bank, Valdosta, GA
First Choice Community Bank, Dallas, GA
Cortez Community Bank, Brooksville, FL
First National Bank of Central Florida, Winter Park, FL


http://www.fdic.gov/

[Hotler]

22. k&r n/t

[Demeter]

24. Yes Indeed, Sheila Did Not Give Her Workers May Day This Weekend

Premier American Bank, National Association, Miami, Florida, acquired the banking operations, including all the deposits, of two Florida-based banks. To protect depositors, the Federal Deposit Insurance Corporation (FDIC) entered into purchase and assumption agreements with Premier American Bank, N.A.

First National Bank of Central Florida, Winter Park, Florida, was closed today by the Office of the Comptroller of the Currency, which appointed the FDIC as receiver. Cortez Community Bank, Brooksville, Florida, was closed by the Florida Office of Financial Regulation, which appointed the FDIC as receiver.

All eight branches of the two closed banks will reopen on Monday as branches of Florida Community Bank, a division of Premier American Bank, N.A...As of December 31, 2010, First National Bank of Central Florida had total assets of $352.0 million and total deposits of $312.1 million; and Cortez Community Bank had total assets of $70.9 million and total deposits of $61.4 million. Besides assuming all the deposits from the two Florida banks, Florida Community Bank will purchase essentially all of their assets.

The FDIC and Premier American Bank, N.A. entered into loss-share transactions on the failed banks' assets. The loss-share transaction for First National Bank of Central Florida was $270.0 million; and the loss-share transaction for Cortez Community Bank was $51.3 million. Premier American Bank, N.A. will share in the losses on the asset pools covered under the loss-share agreements...The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) for First National Bank of Central Florida will be $42.9 million; and for Cortez Community Bank, $18.6 million. Premier American Bank, N.A.'s acquisition of all the deposits of the two institutions was the "least costly" option for the DIF compared to all alternatives.

The closings are the 35th and 36th FDIC-insured institutions to fail in the nation so far this year and the third and fourth in Florida. Prior to today, the last bank closed in the state was Sunshine State Community Bank, Port Orange, on February 11, 2011.


Bank of the Ozarks, Little Rock, Arkansas, acquired the banking operations, including all the deposits, of two Georgia-based banks. To protect depositors, the Federal Deposit Insurance Corporation (FDIC) entered into purchase and assumption agreements with Bank of the Ozarks.

First Choice Community Bank, Dallas, Georgia, and The Park Avenue Bank, Valdosta, Georgia, were closed today by the Georgia Department of Banking and Finance, which appointed the FDIC as receiver.

All 19 branches of the two closed banks will reopen during their normal business hours beginning Saturday as branches of Bank of the Ozarks...As of December 31, 2010, First Choice Community Bank had total assets of $308.5 million and total deposits of $310.0 million; and The Park Avenue Bank had total assets of $953.3 million and total deposits of $827.7 million. Besides assuming all the deposits from the two Georgia banks, Bank of the Ozarks will purchase essentially all of their assets.

The FDIC and Bank of the Ozarks entered into loss-share transactions on the failed banks' assets. The loss-share transaction for First Choice Community Bank was $260.7 million; and the loss-share transaction for The Park Avenue Bank was $514.1 million. Bank of the Ozarks will share in the losses on the asset pools covered under the loss-share agreements...The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) for First Choice Community Bank will be $92.4 million; and for The Park Avenue Bank, $306.1 million. Bank of the Ozarks' acquisition of all the deposits of the two institutions was the "least costly" option for the DIF compared to all alternatives.

The closings are the 37th and 38th FDIC-insured institutions to fail in the nation so far this year and the ninth and tenth in Georgia. Prior to today, the last bank closed in the state was New Horizons Bank, East Ellijay, on April 15, 2011.


Community Central Bank, Mount Clemens, Michigan, was closed today by the Michigan Office of Financial and Insurance Regulation, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Talmer Bank & Trust, Troy, Michigan, formerly known as First Michigan Bank, to assume all of the deposits of Community Central Bank.

The four branches of Community Central Bank will reopen on Saturday as branches of Talmer Bank & Trust...As of December 31, 2010, Community Central Bank had approximately $476.3 million in total assets and $385.4 million in total deposits. Talmer Bank & Trust will pay the FDIC a premium of 0.25 percent to assume all of the deposits of Community Central Bank. In addition to assuming all of the deposits of the failed bank, Talmer Bank & Trust agreed to purchase essentially all of the assets.

The FDIC and Talmer Bank & Trust entered into a loss-share transaction on $362.4 million of Community Central Bank's assets. Talmer Bank & Trust will share in the losses on the asset pools covered under the loss-share agreement...The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $183.2 million. Compared to other alternatives, Talmer Bank & Trust's acquisition was the least costly resolution for the FDIC's DIF. Community Central Bank is the 39th FDIC-insured institution to fail in the nation this year, and the second in Michigan. The last FDIC-insured institution closed in the state was Peoples State Bank, Hamtramck, on February 11, 2011.

[Demeter]

25. THAT BRINGS THE LOSS FOR THE WEEKEND TO $643.2M

Not bad for an evening's work...

[Demeter]

27. Dilbert Faces Class Warfare

[xchrom]

28. i have Festooned my May Pole.

it looks Fabulous.

[Demeter]

30. Going for the Pagan? Good Idea!

I had a lovely 1.5 Day holiday...well, at least a day. Got a massage to take the knot out of my shoulder blade. Of course, the job put it right back in, but perhaps the circulation has been restored and it will heal if I let it...

[xchrom]

33. Excellent - I'm glad you had some down time.

Happy May Day to you.

[Demeter]

29. An Unstable Economy Wobbling Atop Unsound Money

http://dailyreckoning.com/an-unstable-economy-wobbling-atop-unsound-money/

...This week we heard from Chairman Bernanke about how his "on sound footing" recovery (somehow, remarkably, standing atop unsound money) is beginning to falter. The recovery, says he, is now "moderate," requiring the Fed to maintain their historically low interest rates for "an extended period." More unsound money, in other words...designed to build a surer foundation on which to erect that ever-illusive recovery.

So, are investors actually buying the Chairman's newspeak? At the very moment The Bernank was busy proclaiming his commitment to a "strong dollar policy," the dollar index hit a brand new, post-2008 recession low. Strange, no?
What about precious metal investors? Are they betting on The Bernank? The price of gold says, emphatically, NO! An ounce of the anti-dollar metal this week hit $1,560...although, by the time you read this, it may have already moved higher. (Of course, for our purposes, it's more correct to say that the dollar actually slid to 1/1,560th an ounce of gold...but that's a tale for another day.) And what of those other anti-dollar investments? Silver is back up to $48 an ounce and crude (West Texas Intermediate) climbed back above $113 per barrel. Of course, Bernanke tells us this high price will be a temporary phenomenon. Yes...and spending money to get rich is a sound financial plan, too... unemployment is too high ... the growth rate is slowing...and presume to know what to do about it. Take GDP, for example. As you might have seen, this rather meaningless "measurement" contracted during the first quarter of the year, down to 1.8% annualized from a 3.1% rate the previous quarter. It was the "worst" showing since last spring, the (thus far) height of the European debt debacle.

No, Fellow Reckoner, the powers-that-be are not here to fix your problems and cure your ills. They're here to cause, induce and exacerbate them. They fiddle with this sector and stimulate with that one, trying to get the "machine" to correct its course. But every time they hit the accelerator, the wheels fall off and the engine stalls. Individual components seize up and cease to work. And so the wonks scratch their heads and go back to the same old drawing board.
...Astute readers can already see here how the measurers and fiddlers have missed the point altogether. Then again, to our recollection, they've never displayed a shred of evidence that they grasped it in the first place.

First of all, there is no "machine"...no "economy" of which to speak. Not in the sense they are expecting, anyway. There is no economy that isn't comprised of individuals and their reliably untamable, unforecastable, untinkerable aspirations and desires. As Frank Shostak, an adjunct scholar of the Mises Institute, puts it, "The GDP framework gives the impression that it is not the activities of individuals that produce goods and services, but something else outside these activities called the 'economy.' However, at no stage does the so-called 'economy' have a life of its own independent of individuals. The so-called economy is a metaphor – it doesn't exist." And thus is this fundamental flaw of the orderers' and meddlers' plans laid bare for all to see. They are tuning something that can't be tuned...(IGNORING) the wills and desires of its many millions of participants...

[Demeter]

31. Spend It Like You Stole It By Bill Bonner

QE2 is ending in June. But globally, QE3 has already begun. As usual, Japan is the pacesetter. As temperatures rose at its Fukushima reactor so did Japan’s monetary base – at the rate of 100% per week! What happens to all this new, hot money? No one knows, exactly. But today, at The Daily Reckoning, we have advice for everyone – central planners, politicians, and householders, too: if you have money, pretend you robbed a bank...From the point of view of a modern economist, nothing stimulates better than a bank robbery. The money leaves the cold embrace of a bank vault; soon every pimp and bartender has his pockets full. Hot money gets around.

An article in Rolling Stone Magazine provides an illustration. It explains how one Wall Street wife, and one Wall Street widow, formed a company specifically to take advantage of the US government’s spending spree known as TALF. You’d think the feds had already done enough for the Mack family. John Mack runs Morgan Stanley. Had it not been for the generous support of the US government and the Federal Reserve, he might be parking cars. Instead, the feds bailed out the entire financial sector. First, it bought up Wall Street’s bad bets at inflated prices and then lent banks money at artificially low interest rates; they were invited to lend the money back to the federal government for a sure profit...Business was so good at Morgan Stanley that the distaff side of the Mack household apparently couldn’t resist. In June, 2009, with her friend Susan Christy, Mack set up an investment company and put in $15 million. Then, they borrowed $220 million from the government. A brave move on their part? If you think so, you are as naïve as a turnip. The fix was in; the two used the money to buy non-recourse loans at deep discount. If the loans increased in value, they would make a profit. If they fell, the government would take the losses. Much safer and more profitable than robbing banks. Two months later, Mr. Mack, perhaps with a little assistance from his blond helpmate, bought a limestone carriage house in Manhattan, with a 12-space garage for the getaway cars.

If you don’t have your own little stimulus scam going, you may want to listen up. Your dollars, pounds, euros and pesos are going to lose value. Don’t trust the government’s inflation figures. An honest measure of the “inflation rate” is available thanks to a pair of professors at MIT. Their “Billion Prices Project” (BPP) doesn’t pussyfoot around. It trolls the Internet, records prices and reveals the most accurate measure of inflation ever. This new index shows the rate of consumer price increases for the last 12 months at 3.2%. This is more than half again as much as the Labor Department’s own tally – 2.1%.


In America, real private-sector output reached a plateau at the end of the 20th century. In the last 10 years, it has scarcely increased at all. Total private sector GDP was $9.31 trillion in 2001. Now it is $9.72 trillion. But while real output has been flat, the output of hot “money” has not. When they are not stealing it from the taxpayers, or borrowing it with no intention to pay it back, the feds are counterfeiting it. The Fed will have “printed up” about $1.8 trillion from the end of 2008 to the end of June, 2011 – partly to finance staggering federal government deficits of nearly $4.5 trillion over the three years. This led to an increase in the GDP, almost entirely from government spending, with 79% of household income growth from government transfer payments...Meanwhile, the US monetary base has tripled in the last 3 years. These increases are not all immediately available to households as “money;” they are mostly still in bank vaults, waiting to be liberated. Then, watch out. Dollars will be too hot to hold.

Read more: Spend It Like You Stole It http://dailyreckoning.com/spend-it-like-you-stole-it/#ixzz1L6zGE7oN

[Demeter]

34. Staying On the Right Side of the Inflation Trade By Eric Fry

This dynamic – falling dollar, rising stocks – is just another way of saying the stock market, in aggregate, has become little more than an “inflation trade.” This particular inflation trade may contain a variety of stock symbols and may attract continuous, hyperactive blather on financial news networks, but it is still just an inflation trade. Believing that a dollar bill will buy less tomorrow, US investors will use their dollars to buy almost anything today, including richly valued stocks. US stocks, as an inflation trade, have performed adequately so far in 2011. The S&P 500’s 7.5% year-to-date gain roughly equals the Dollar Index’s year-to-date loss.

Over longer time frames, however, the US stock market has delivered a much less effective hedge against the falling dollar than, say, gold or silver. During the last 10 years, for example, the S&P 500 produced a cumulative total return of 33.7%…when measured in US dollars. When measured in Australian dollars, however, this gain flips to a 35% loss!

In fact, in terms of every major world currency, as well as numerous minor world currencies, the S&P 500 has been a losing bet for the last decade. In terms of the precious metals, the S&P 500 has been a very large losing bet...By simply exchanging dollars in April 2001 for any of the currencies or precious metals in the chart above, a dollar-phobic investor would have received a greater total return than by buying US stocks. Bear in mind that this chart does not include in its calculation the interest an investor could have earned in any of these foreign currencies.

Read more: Staying On the Right Side of the Inflation Trade http://dailyreckoning.com/staying-on-the-right-side-of-the-inflation-trade/#ixzz1L72FVePb

[bread_and_roses]

35. "The game is over. We lost." - Hedges

I think this has been posted before. I think it's worth posting again, if so.

http://www.truthdig.com/report/item/the_corporate_state_wins_again_20110425/

The rhetoric of the Democratic Party and the neoliberals sustains the illusion of participatory democracy. The Democrats and their liberal apologists offer minor palliatives and a feel-your-pain language to mask the cruelty and goals of the corporate state. The reconfiguration of American society into a form of neofeudalism will be cemented into place whether it is delivered by Democrats, who are pushing us there at 60 miles an hour, or Republicans, who are barreling toward it at 100 miles an hour. Wolin writes, “By fostering an illusion among the powerless classes” that it can make their interests a priority, the Democratic Party “pacifies and thereby defines the style of an opposition party in an inverted totalitarian system.” The Democrats are always able to offer up a least-worst alternative while, in fact, doing little or nothing to thwart the march toward corporate collectivism. ...

... The game is over. We lost. The corporate state will continue its inexorable advance until two-thirds of the nation is locked into a desperate, permanent underclass. Most Americans will struggle to make a living while the Blankfeins and our political elites wallow in the decadence and greed of the Forbidden City and Versailles. These elites do not have a vision. They know only one word—more. They will continue to exploit the nation, the global economy and the ecosystem. And they will use their money to hide in gated compounds when it all implodes. Do not expect them to take care of us when it starts to unravel. We will have to take care of ourselves. We will have to create small, monastic communities where we can sustain and feed ourselves. It will be up to us to keep alive the intellectual, moral and culture values the corporate state has attempted to snuff out. It is either that or become drones and serfs in a global, corporate dystopia. It is not much of a choice. But at least we still have one.

[Demeter]

36. Bond Market Blackmail (ICELAND)

http://www.truthout.org/bond-market-blackmail/1303911371

* Iceland’s banks offered high-rate savings accounts to depositors in other countries, notably the United Kingdom and the Netherlands. These accounts did not have an explicit government guarantee.
* In 2008, the global financial system nearly collapsed, Iceland’s banks failed, and depositors got more or less wiped out.
* Iceland, unlike Ireland, did not guarantee its banks’ liabilities. It did, however, choose to bail out domestic depositors in those banks — but not foreign depositors.
* The U.K. and the Netherlands both chose to bail out their citizens who had deposited money in Iceland’s banks.
* The U.K. and the Netherlands then tried to get the Icelandic government to pay them back. They negotiated a settlement, but that was rejected by a popular referendum in Iceland. Then they negotiated another settlement (which would have cost Iceland about $6,000 per person), but that was also rejected.

Now, there is a legal question about whether or not Iceland has an obligation to bail out foreign depositors in its banks. Remember, there was no explicit government guarantee. The question is whether bailing out domestic but not foreign depositors is illegal discrimination under international law...The economic question ... is whether paying off the U.K. and Dutch governments will help Iceland attract foreign investment in the future. They had a bond investor from Vanguard — ordinarily just about my favorite financial institution — saying that a vote against the settlement would make investors less likely to lend money to the Icelandic economy in the future.

Now, this may be true (although I doubt it). But think about what this is really saying: Some people — largely retail investors — lent money to Iceland’s banks, either deciding that the high interest rates made up for the lack of a government guarantee or not bothering to check if there was a government guarantee. They lost their money (or they would have, if their home governments hadn’t bailed them out). The lesson I think people should learn from this is: MAKE SURE THERE’S A GOVERNMENT GUARANTEE!!!!! In other words, lenders should be smarter in the future...Vanguard Bond Guy is saying something different, however. He’s essentially saying that foreign investors will only lend money to some country’s private institutions if that country promises to bail out foreign investors should those private institutions fail. That’s the only light in which his statement makes any sense. In the future, lenders to Icelandic institutions will only care about the chances of their future loans being paid back. Whether Iceland pays off the U.K. and the Netherlands now can only matter as a signal about Iceland’s future behavior. And the only signal it could possibly send is that Iceland recognizes some hitherto nonexistent obligation to bail out its private institutions whenever they default.

This is both obnoxious and crazy. It’s obnoxious for the same reason the campaign against strategic homeowner defaults is obnoxious. If you made a zero-money-down loan to someone and he walks away, it’s your fault. The lesson you should learn is that you shouldn’t make zero-money-down loans; you shouldn’t suddenly invent some principle that people should pay debts they no longer owe when it’s not in their own interests...And it’s crazy because — what does it say about capitalism? The theory of the financial markets is that they allocate capital to the places where it will be used most efficiently. If Bond Guy is right, that’s not true: they allocate capital to the places where the government provides the strongest implicit guarantees. You want capital? Then your government has to bail foreign creditors out of their bad decisions. How is that good?

[Demeter]

38. It's 71F!

Of course the sky is a mass of storm clouds, and the humidity is 100% and there's probably a tornado watch, and it FEELS like 80+ so I'm wearing shorts (for the second time this year)....

and I'm too relaxed ( or exhausted) from my day off the leash to do any more. Happy May Day Everyone!

Here's my favorite May Day song:

http://www.youtube.com/watch?v=pljyjiIMH9o

And a more traditional treatment:

http://www.youtube.com/watch?v=B8NBtPxeR1E

[burf]

40. We had a light snow here today!

When this cold front that is comin' through here now heads south, it ain't gonna be pretty.

[bread_and_roses]

39. Delusion and Denial Part 1: Work, Jobs...

Some good food for thought here, I think...

http://www.commondreams.org/view/2011/05/01-1

Yet, as we can readily know from non-western, indigenous cultures, these basic necessities are not predicated on money. In reality, human beings as a particular animal species do not need money to live. So, why do we rely on this monetary system, dominated by corporate capitalism? We can give excuses like this way of life enables technological, intellectual, and creative “progress” that could not be accomplished otherwise. That is a nice conceit. The premise is based on the false assumption that our modern way of life has led to more leisure time during which we do not have to work for basic necessities and can accomplish feats of intellectual, creative, and technological marvel. The truth is we have less leisure time than we used to, and most of it is spent observing and imbibing the spectacle of bread and circuses...

... From a very young age, what is presented as of principal concern is making a good living to provide for you and your family - or better yet, making lots and lots of money as fast as possible. How that is accomplished, and what harm may be done to other people, communities, or society in doing so is wholly and utterly neglected....

...This self-concern is the primary objective given to work today. We are constantly reminded about the virtues and rewards of hard work. We work mainly to amass wealth for ourselves and our families – or, more likely nowadays, to try to maintain the basics needed to survive. However, not only is this self-concern an illusion promulgated by corporate interests to feed our egos and make us feel empowered as indentured servants, the value of work in and of itself is a fallacy. Jobs do not have inherent value; indeed many, if not most, do much more harm than good...

[Demeter]

41. I am glad to know I'm not the only heretic in the western world