Weekday NEWS to Comfort the Disturbed and Disturb the Comfortable.
Mon 02.01.2010
''Iran will deliver telling blow to global powers on Feb. 11th Iranian President Mahmoud Ahmadinejad says the nation will deliver a harsh blow to the "global arrogance" on this year's anniversary of the Islamic Revolution. "The Islamic Revolution opened a window to liberty for the human race, which was trapped in the dead ends of materialism," Ahmadinejad said during a cabinet meeting on Sunday.
US raises stakes on Iran by sending in ships and missiles Chris McGreal - Guardian Pentagon says Patriot shield will deter strike on American allies in the Gulf Tension between the US and Iran heightened dramatically today with the disclosure that Barack Obama is deploying a missile shield to protect American allies in the Gulf from attack by Tehran. The US is dispatching Patriot defensive missiles to four countries – Qatar, United Arab Emirates, Bahrain and Kuwait – and keeping two ships in the Gulf capable of shooting down Iranian missiles. Washington is also helping Saudi Arabia develop a force to protect its oil installations.
U.S. expanding missile defenses in Gulf WASHINGTON (Reuters) - The United States has expanded land- and sea-based missile defense systems in and around the Gulf to counter what it sees as Iran's growing missile threat, U.S. officials said. The deployments include expanded land-based Patriot defensive missile installations in Kuwait, Qatar, UAE and Bahrain, as well as Navy ships with missile defense systems in and around the Mediterranean, officials said. General David Petraeus, who as head of U.S. Central Command is responsible for military operations across the Middle East, said this month that the United States has stationed eight Patriot missile batteries in four Gulf countries, which he did not identify.
US boosts missile presence in Gulf as warning to Iran By James Sturcke - Guardian Pentagon expands Patriot missile programme across Middle East after Tehran repeatedly spurns hand of diplomacy The Obama administration is intensifying pressure on Iran by increasing its missile defences in the Middle East to defend against potential missile strikes in the region by Tehran, it emerged today. The US military has boosted the capability of land-based Patriot defensive missiles in several Arab nations in the Gulf, and one official told the Associated Press the navy was also increasing the presence of ships capable of knocking out hostile missiles in flight
Fears that US missiles move may be exploited by Iran's hardlinersDeployment may strengthen repressive regime in Tehran and could lead to action against US interests in region By Robert Tait - Guardian - Iran greeted news of the US plans to station missile defences in neighbouring Arab states with a stony official silence today. While the development went unreported by the two official news agencies, IRNA and Fars, the closest thing to a government response was a comment from a hardline MP, Hassan Sobhani-niya, that the matter would "probably" be discussed by the parliament's national security and foreign policy committee on Tuesday.
China, Iran Prompt U.S. Air-Sea Battle Plan in Strategy Review By Viola Gienger and Tony Capaccio Feb. 1 (Bloomberg) -- The U.S. military is drawing up a new air-sea battle plan in response to threats such as China’s persistent military build-up and Iran’s possession of advanced weapons, according to the Pentagon’s latest strategy review. The Air Force and Navy are seeking more effective ways of ensuring continued access to the western Pacific and countering potential threats to American bases and personnel, according to the Quadrennial Defense Review to be released later today.
#11:Florida Community Bank, Immokalee, Florida Florida Community Bank, Immokalee, Florida, is the 11th FDIC victim of 2010. The agency estimates that the cost to its deposit insurance fund (DIF) will be $352.6 million.
#15:American Marine Bank, Bainbridge Island, Washington American Marine Bank, Bainbridge Island, Washington, is the 15th FDIC-insured institution to fail in the nation this year. The FDIC closed the ailing bank at an estimated cost of $58.9 million to the Deposit Insurance Fund (DIF).
US banks face insider trading probe By Tom Braithwaite in Washington Neil Barofsky, the special inspector-general overseeing the US government’s financial rescue efforts, is to probe allegations of insider trading among bank executives and their associates. Eight of the largest banks in the US received between $2bn and $25bn in October 2008 under a programme to prop up the financial system led by Hank Paulson, then Treasury secretary. Dozens more institutions followed and Mr Barofsky, who examines the troubled asset relief programme, is looking into whether information improperly made its way to trading rooms during a feverish period in which the government and banks were frequently exchanging information.
Bankers in favour of paying global fee [TAX] By Patrick Jenkins, Tom Braithwaite - FT Some of the world’s most prominent bankers have come out in favour of a global bank wind-down fund, a concession from the industry after weeks of fighting proposals for new taxes in the US and Europe. Josef Ackermann, chief executive of Deutsche Bank, told the Financial Times on Friday : “To help solve the too-big-to-fail problem I’m advocating a European rescue and resolution fund for banks. Of course, the capital for this fund would have to come from banks to a large degree.”
Herbert Hoover Obama by Peter Schiff - Lew Rockwell The Precarious State of Our Union In this week's much anticipated State of the Union address, President Obama again demonstrated his poor understanding of the fundamental problems that confront our nation. By following the advice of the same people who helped guide our economy to the precipice of total collapse, Obama now threatens to push it over the edge.
'Walking away' not immoral, prof says by J. Craig Anderson - The Arizona Republic He expands defense of homeowner in default Arizona law professor Brent White says the only thing standing between many "underwater" homeowners and a better financial future is a misguided sense that walking away from a loan commitment is morally wrong. White, an associate professor at University of Arizona's James E. Rogers College of Law, has spent the past few months presenting his argument to other lawyers, real-estate professionals and the national media. It started with a 50-page discussion paper he published in October, in which White argues that underwater homeowners, those whose unpaid loan balance exceeds the value of their home, are being manipulated into picking up the tab for a real-estate crash that borrowers and lenders created equally. "I'm all for a society where people must take personal responsibility, but that should also apply to the banks and financial institutions," he said.
Growth spurt expected to slow this year By Patrice Hill - Washington Times Jobs, credit remain tight After the best quarterly growth in six years at the end of 2009, the economy is expected to settle down in 2010 to a more subdued state that reflects underlying difficulties with jobs and credit still weighing on consumers. Investors were pleasantly surprised on Friday by a report showing sizzling growth at a 5.7 percent annual rate in the final quarter of 2009 — more than doubling the 2.2 percent growth rate in the summer, when the economy emerged from recession. But the growth spurt was almost entirely fed by one-time events — in particular, a slowdown in a massive liquidation of overstocked goods by businesses that held back the economy throughout 2009.
Rising Corporate Debt Could Bankrupt Firms, Crash Market by 2013 By MATTHEW SCOTT - Daily Finance Wall Street's love of leverage is threatening to turn around and bite it in the assets, as many companies find their issuance of debt could potentially become their undoing. Massive amounts of corporate debt issued between 2003 and 2007 will come due over the next four years, and companies' inability to refinance their debt will leave them stuck with high interest payments, dragging down corporate earnings and forcing some companies into bankruptcy. Standard & Poor's estimates that 807 speculative grade issues were originated in the U.S. from 2006 through 2009, and while only 82 (11%) of those bonds have defaulted, an alarming number of these issues still have below investment-grade ratings and are very much at risk of default.
Gold the Only Best Bull Market in Town Gold is trying to carve out a bottom, as it fell 11.20 for the week, closing at $1081.50 (-1.02%). Downside momentum has lessened from last week’s 3% decline. The big question now is: where is gold going to from here? No one knows for sure, but let’s take a look at where it is, and where it has come from, in order to determine the most probable scenario going forward. The following chart gives a long term perspective on gold – covering the start of its bull market until the present. It is a monthly chart that rises from the lower left to the upper right: a bullish signature.
Why no one can defeat gold By Jim Sinclair There is no boom. I am in the one business which has proven since 1985 when I started it, as the perfect forecasting indicator. I am in food wholesale. It relates to food service (restaurants) and retail stores. In every past downturn, I do well about 6 months before the statistics point towards a nice up tick in conditions in terms of my sales to food service. When things look iffy, my sales to retail pick up just prior to the numbers coming out that things look not so cool. It has worked like clockwork for me in ‘knowing’ the future.
Are Precious Metals Melting or Firming Up? by Chris Vermeulen The past two months have been tough on the precious metals sector. We saw precious metals lead the market higher all of last year until December 2009 when prices plummeted as the US Dollar started to bounce. The continued rise in stocks indicated an extreme overbought condition and alerted us that a sharp pullback was going to take place.
Will a Threatened Euro Affect the Gold Price by Julian D. W. Phillips Claude Trichet, head of the European Central Bank dismissed talk of Greece exiting the Euro as their national currency. The fact that he felt it necessary to issue such a statement meant that the prospect was being discussed outside the E.C.B. Instead, the EU is considering sanctions against the country to bring it into line with the E.U. The stress is high in the Eurozone!
Why dollar decline is a boost for gold By Jim Sinclair WARNING: In the last two days you have received two emails, both more than likely unsolicited by you, yet not unwelcome. There are some misassumptions concerning their argument for the US dollar and gold in both communications. The first is: "Fed’s Currency Swap Lines: A BIG deal for the Dollar" This article written in good faith, I am sure, but fails on three points. 1. It properly defines the basic currency swap between central banks but fails to follow the money through the transaction to its final destination. The swaps done with the ECU, Swiss, British and other non-US central banks were for the purpose of bailing out those non-US banks that were the losing debit counter party to major US derivative dealers.
The Ultimate Bubble and the Mother of All Carry Trades Among the many opinions expressed by billionaire investor George Soros over the course of the 2010 World Economic Forum in Davos, Switzerland was his statement on January 28 in an interview with Maria Bartiromo, host of CNBC's Closing Bell, that "When interest rates are low we have conditions for asset bubbles to develop, and they are developing at the moment. The ultimate asset bubble is gold." New York spot gold closed at $1085.40 down $1.80, but the price of gold is not as much about gold as it is about the value of currencies, particularly the US dollar.
China, Gold, the Dollar and the Dow By CHARLES HUGH SMITH When the Dow Jones Industrial Average fell over 500 points last week and global markets dropped 5% in a matter of days, investors everywhere began pondering the question: Is this just a brief dip in the uptrend, or a more ominous change of trend? Investors and money managers are trying to assess which markets and commodities might be topping out and which are still rising. If one market is topping out, then common sense suggests moving money from that position into an investment that is still trending up.
China is new gold king China has emerged as the gold king in 2009 as far as production and consumption are concerned. China’s gold output reached 313.98 tonnes in 2009, up 11.34 per cent year-on-year. This was the first time that China’s gold output had exceeded 300 tonnes, setting a new record. So far, China’s gold output has been first in the world for 3 consecutive years. In 2009, the industrial output value of China’s gold industry reached 137.53 billion yuan, up 18.56 per cent year-on-year.
On the Edge with Max Keiser - 29 January 2010 (1/3)
On the Edge with Max Keiser - 29 January 2010 - (2/3)
On the Edge with Max Keiser - 29 January 2010 - (3/3)
Roubini Sees ‘Dismal’ Growth as Summers Rues ‘Human Recession’ By Simon Kennedy and Erik Schatzker -- Feb. 1 (Bloomberg) -- Nouriel Roubini, the New York University professor who anticipated the financial crisis, said the U.S. growth outlook remains “very dismal” and White House economic adviser Lawrence Summers said the economy is still mired in a “human recession.” Speaking at the World Economic Forum’s annual meeting in Davos, Switzerland, after the U.S. reported the fastest growth in six years, their comments underscored concern that that emergency measures to rescue banks and fight the recession may be withdrawn too soon.
Brace yourselves for the next wave of the bear market Brian Milner - The Globe & Mail If the ‘January barometer' proves accurate, the next 11 months will see stock slide further People who believe the old saw that whatever the markets do in January sets the pattern for the rest of the year must be battening down the hatches for stormy times ahead. The world's leading stock indexes all finished the first month of 2010 in the red. Investors – especially those who never quite bought the bull-is-back story but didn't want to miss the great rally of 2009 –pulled more money out of U.S. equity funds in the last days of January than in any single week since mid-2008. Emerging-market equity funds suffered their worst withdrawal symptoms in six months.
Second leg crash, what's next in 2010? Christopher Laird A lot of people realize that the world financial and commodity markets have rocketed around 60 pct since March 2009. Around the summer/fall people realized that the markets got ahead of the world economy, which is still terrible. Unemployment is still rising and one day this month there were US job losses of 50,000 announced. Hey if jobs are again going to tank (they are) then this gig of so called recovery is over. I had told subscribers that we expected December retail sales to be dismal, and that US economic stats in early 2010 would highly disappoint.
Brutal economy of 1700s has an eerie similarity Neil Reynolds - The Globe & Mail A central bank and a brilliant central banker, easy credit and novel financial investments, high taxes and expansive state debt Robert Prechter, the iconoclastic Atlanta market analyst (publisher of the Elliott Wave Theorist), says the world remains in a bear market of "supercycle" degree - meaning that the world's current economic troubles will be "the deepest and longest since the 1700s." Assume for a disturbing moment that he is right. What went wrong in the 18th century? In what way are we replicating the wrong? What consequences should we anticipate?
Obama's $3.8 trillion budget heading to Congress By Martin Crutsinger AP WASHINGTON — The Obama administration on Sunday endorsed spending an additional $100 billion to attack painfully high unemployment as it prepared to send Congress a $3.8 trillion budget that would provide billions more to pull the country out of the Great Recession while increasing taxes on the wealthy and imposing a spending freeze on many government programs. White House spokesman Robert Gibbs said the administration believed "somewhere in the $100 billion range" would be the appropriate amount for a new jobs measure made up of a business tax credit to encourage hiring, increased infrastructure spending and money from the government's bailout fund to get banks to increase loans to struggling small businesses.
Obama's Rail Plan: A Drop in the Bucket By BRUCE WATSON - Daily finance On Thursday, President Obama and Vice President Biden announced the recipients of almost $8 billion in stimulus grants that are designed to begin development of high-speed rail (HSR) networks. The money will go to 13 "travel corridors," and will include lines in Oregon-Washington-Canada, California, Wisconsin-to-Chicago, Iowa, Detroit-to-Chicago, St. Louis-to-Kansas City, St. Louis-to-Chicago, Cleveland-to-Cincinnati, Texas, Tampa-to-Orlando, Charlotte-to-Washington, and the Northeast Corridor.
Gerald Celente on Financial Sense News Hour January 16, 2010
Bailout cop: TARP's not working By David Ellis - CNNMoney The watchdog charged with monitoring the government's $700 billion bailout unleashed one of his harshest criticisms of the program to date, questioning its overall effectiveness. In his latest quarterly report to Congress, special inspector general Neil Barofsky said that the Troubled Asset Relief Program, or TARP, has failed to boost bank lending as well as halt the spread of foreclosures -- two key aims of the sprawling program.
TARP overseer says bank bailout program has mixed results By Ronald D. Orol, MarketWatch TARP stabilized system, but bailed out banks lend less; more foreclosures soon The government's $700 billion bank bailout bill has met its goal of helping bring the financial markets back from the brink, but has so far failed to increase lending from the banks who received the taxpayer assistance, a key government overseer reported Sunday in a generally critical review of the program. "On the positive side, there are clear signs that aspects of the financial system are far more stable than they were at the height of the crisis in the fall of 2008," according to a quarterly report to Congress submitted by the office of the Special Inspector General for the government's $700 billion Troubled Asset Relief Program.
Volcker on Big Banks: ‘Structural Changes’ Needed Clearly making his mark as the chief proponent of separating big banks from their lucrative-but-riskier speculative investment operations, former Federal Reserve chairman Paul Volcker said “structural changes” are needed to avoid repeating history with another crippling financial crisis. In an opinion piece – “How to Reform Our Financial System” – published today on the New York Times website, Volcker gave his rationale for supporting capital markets trading restrictions on the biggest commercial banks where a significant portion of Americans keep their money.
How to Reform Our Financial System By PAUL VOLCKER - NY Times PRESIDENT OBAMA 10 days ago set out one important element in the needed structural reform of the financial system. No one can reasonably contest the need for such reform, in the United States and in other countries as well. We have after all a system that broke down in the most serious crisis in 75 years. The cost has been enormous in terms of unemployment and lost production. The repercussions have been international.
Why Politics Makes It Hard to Fix the Banks By JAMES CULLEN Bank earnings season is under way, and with the financial results will come disclosures about average per-employee compensation that politicians seeking support for additional regulations or taxes on big banks will pounce on. Some of the proposals may make their way in some form into President Obama's financial reform plan. At the same time, the banks' decreased lending will be portrayed as a sign that banks are ungrateful to the American public for the generous bailouts they received -- and that they're unwilling to help restart the economy. Each of these arguments is based on a truthful data point.
Bernanke May Have Harder Fight Defending Fed After Confirmation By Scott Lanman Jan. 29 (Bloomberg) -- Ben S. Bernanke, who won Senate approval for a second term as Federal Reserve chairman over a record number of opponents, may now have a tougher fight against threats to the central bank itself. Lawmakers are considering legislation to remove a shield from congressional audits of monetary policy and strip the Fed of bank-supervision powers, measures that Bernanke opposes.
Kohn Says Predicting Fed Policy Impact Especially Hard By Joshua Zumbrun Jan. 29 (Bloomberg) -- Federal Reserve Vice Chairman Donald Kohn said predicting the impact of a monetary policy tightening on interest rates is difficult because of “historically low” borrowing costs and the Fed’s unprecedented expansion in assets. “We are in uncharted waters for monetary policy and the financial markets,” Kohn said today to a symposium in Arlington, Virginia. “The response of interest rates across the maturity spectrum to an actual or expected tightening of monetary policy is always hard to predict, but is especially so in current circumstances.”
At A.I.G., Risky Trading Wasn’t Just on the Fringe By MARY WILLIAMS WALSH - NY Times Ever since the American International Group nearly collapsed, the conventional wisdom has been that the exotic derivatives that drove it to the brink were the product of a lone, unregulated subsidiary in London. The Federal Reserve chairman, Ben S. Bernanke, called the London branch “a hedge fund, basically, attached to a large and stable insurance company.” But the suggestion that A.I.G.’s core insurance business did not dabble in derivatives is not quite true. One of its biggest insurance units, incorporated in Delaware, was also dealing in the derivatives known as credit-default swaps, according to regulatory filings with the state.
Is Geithner In or Out? Geithner bashing not seen threatening job--for now WASHINGTON (Reuters) - Those seeking clues on whether U.S. Treasury Secretary Timothy Geithner will keep his job after another congressional scolding got a big one for the "yes" column on Wednesday night -- a warm embrace from the boss. As a grinning President Barack Obama made his way to the podium in the Capitol building to deliver his State of the Union address and he stopped to put his hand on Geithner's shoulder, chatting with him longer than others he greeted. "They arranged it right at the end of the aisle, perfect for the cameras," said Larry Sabato, director of the Center for Politics at the University of Virginia.
1/27/10 Ron Paul on Fox Business: Geithner and AIG
U.S. Can't Afford Not to Have a Second Stimulus Package By LITA EPSTEIN Mark Zandi, chief economist at Moody's Economy.com, and Rudolph Penner, a fellow at the Urban Institute and former Congressional Budget Office director, both said Friday that an additional stimulus package would be required to improve the U.S. economy and allow the nation to avoid a double-dip recession. The two spoke during a conference at the Urban Institute titled "Does the Economy Need – and Can We Afford – Another Jolt of Stimulus?"
Reining in Wall Street's "casino culture" Banking insiders are skeptical about President Obama's plan to cut risk-taking. But others say the new rules will go a long way in reining in Wall Street's cowboys. Obama last week proposed a law that would bar banks from betting in financial markets with their own money, known as proprietary trading. Called the "Volcker rule," after Obama advisor Paul Volcker, the law aims to prevent banks from taking risks that drag them to the brink of failure. No sooner did Obama propose the idea than analysts and bank officials criticized the attempt to limit proprietary trading, in part because of the gray area between banks taking risk and helping customers.
Warning: Capt Bernanke's sinking U.S.S. Titanic By Paul B. Farrell, MarketWatch Cheap money's again blowing new 'icebergs' Let's call it "Titanic II," a classic remake. The Fed's the new Titanic. Bernanke, the egomaniacal captain. His character reminds me of Bogart playing the paranoid, obsessive Captain Queeg in "The Caine Mutiny." Remember that threatened Navy captain who navigates into a fog, panics, nearly rams a battleship? That's "Capt. Ben" in "Titanic II." And given his handling of our banking system and the global economy, he'll sink the Titanic. Capt. Ben's a tragic figure.
Deputies serving more evictions during recession, but most people leave without a fight By Jennifer Squires - Santa Cruz Sentinel The attempted eviction of a renter Tuesday led to an hours-long police standoff and closed roads before sheriff's deputies decided to leave the man inside the Vienna Drive home and seek an arrest warrant. That situation was an extreme example of something deputies are doing more and more often in Santa Cruz County: evictions. "Those spiked when the recession started," Sgt. Dan Campos said, adding it's "notable" how busy the civil service unit at the Sheriff's Office is. Eviction orders handled by deputies rose 25 percent in the past two years and of the 367 orders served in 2009, one-third of the homes were being vacated because of foreclosure, according to Colleen O'Reilly, the civil process supervisor at the Sheriff's Office.
Knives Are Drawn for Proposed Cuts By GREG HITT And NEIL KING JR. - WSJ WASHINGTON—President Barack Obama's plan to reduce the deficit faces a tough battle on Capitol Hill, and prospects for a rapid return to fiscal austerity remain slim. Mr. Obama, responding to growing public concern over deficit spending, will propose as part of his fiscal 2011 budget to freeze basic government spending, outside of national security programs. He also plans to appoint a commission to recommend ways to reduce the deficit. But Republicans are skeptical. Special-interest groups are lining up to protect their own share of the budget. And even some top Democrats are breaking with their president to float their own ideas on how to tackle the deficit.
AMERICA DIDN'T BUY IT By Ezra Klein - Washington Post Few are as good at delivering a high-stakes speech as President Obama, something he proved again in Wednesday's State of the Union. The speech, which focused on jobs and the economy, was feisty, confident and -- rare for presidential addresses -- funny. The insta-poll numbers were great. Joe Klein called it "Obama at his best." It was so good, in fact, that virtually nobody noticed that Obama had already lost the argument.
We've Been Neo-Conned by Ron Paul - Lew Rockwell The modern-day, limited-government movement has been co-opted. The conservatives have failed in their effort to shrink the size of government. There has not been, nor will there soon be, a conservative revolution in Washington. Political party control of the federal government has changed, but the inexorable growth in the size and scope of government has continued unabated. The liberal arguments for limited government in personal affairs and foreign military adventurism were never seriously considered as part of this revolution.
Wages and benefits rise in 2009 by smallest amount on records going back 27 years MARTIN CRUTSINGER - AP -- Wages and benefits paid to U.S. workers posted a modest gain in the fourth quarter, ending a year in which recession-battered workers saw their compensation rise by the smallest amount on records going back more than a quarter-century. The anemic gains have raised concerns about the durability of the economic recovery. The fear is that consumer spending, which accounts for 70 percent of economic activity, could falter if households don't have the income growth to support their spending.
Henry Paulson's book offers a glimpse inside the economic crisis By Zachary A. Goldfarb - Washington Post -- The Washington memoir, typically published after a calamitous event or the end of a political campaign, often brings a nugget or two of news. But that's a tall order for Henry M. Paulson Jr.'s "On the Brink: Inside the Race to Stop the Collapse of the Global Financial System," as many authors have already published thick tomes examining the financial crisis of fall 2008. As Treasury secretary, Paulson helped oversee the government's intervention, and his memoir is the first lengthy account of the crisis from a key decision-maker. The book offers a look at Paulson's thinking during those scary days, as well as his sometimes unvarnished opinions of other Washington characters, many of whom had central roles in managing the government's response.
Paulson Says Russia Urged China to Dump Fannie, Freddie Bonds By Michael McKee and Alex Nicholson Jan. 29 (Bloomberg) -- Russia urged China to dump its Fannie Mae and Freddie Mac bonds in 2008 in a bid to force a bailout of the largest U.S. mortgage-finance companies, former Treasury Secretary Henry Paulson said. Paulson learned of the “disruptive scheme” while attending the Beijing Summer Olympics, according to his memoir, “On The Brink.”
The Places They Go When Banks Say No By ANDREW MARTIN - NY Times IN the glory days of the digital photo frame business, when his products were still a novelty and shoppers were flush with cash, getting a bank loan to manufacture them was a cinch, Michael Levy says. “We would say: ‘We got a $1 million order from the Sharper Image. We need financing. With a snap of the fingers, the guy drove down to my office, we’d sign a document, he’d give us the money,” Mr. Levy recalls, sitting in the Deer Park, Long Island, office of the Media Street Group that he runs with his brother, Norm.
In tough economic times, shoppers take haggling to new heights By Michael S. Rosenwald - Washington Post The price tag on the smooth pair of Cole Haan loafers at Macy's said $148. I considered that a fair opening bid. Standing across from the salesman and the cash register, I said, "Can you knock off 25 percent?" The salesman said, "Can't do it." But I pressed on: "I'll get them on the Internet or at one of your competitors, so let's just do this here." Salesman: "Geez. You're like the second person who has tried to do this today." We stared at the shoe box. I liked what was inside. The loafers fit well, but they would feel even more comfortable with a discount.
Crisis of the Government Party by Patrick J. Buchanan - Lew Rockwell President Obama is in a dilemma from which there appears to be no easy or early escape. Democrats are the Party of Government. They feed it, and it feeds them. The larger government grows, the more agencies that are created, the more bureaucrats who are hired, the more people who become beneficiaries, the more deeply entrenched in power the Party of Government becomes. At the local, state and federal level, there are 19 million to 20 million government employees. And if one takes only Social Security, Medicare, Medicaid, food stamps and earned income tax credits, we are talking of scores of millions who depend on government checks for the necessities of their daily life.
Overseer Sheds Doubt on TARP Helping Small-Biz, Foreclosures A somber and pessimistic assessment of the government’s bailout program has been issued by the official overseer of the $700 billion Troubled Asset Relief Program (TARP) – concluding that the fundamental problems in the U.S. financial system are still in place for another crisis. The report also pointed out that TARP has yet to provide increased loans to small businesses, despite the announced creation of such a plan 10 months ago.
Obama’s $30B Plan for Small Businesses May Not Work In his State of the Union speech, President Barack Obama proposed taking $30 billion out of the bailout money returned by big banks and injecting the funds into community banks to generate more small business loans. But the plan will likely fall short in a lending arena where low demand matches low access to credit. Moreover, the small-biz bailout has already generated enough opposition to place it in doubt – particularly if a full vote by Congress is required.
Obama Housing Rescue Threatened by Foreclosures, Unemployment By Kathleen Howley -- Jan. 29 (Bloomberg) -- President Barack Obama’s efforts to bolster the U.S. housing market, the trigger of the worst recession since the 1930s, may be undone by record unemployment and repossessions by lenders. Foreclosures probably will reach 3 million this year, surpassing the record of 2.82 million in 2009, according to Irvine, California-based RealtyTrac Inc. That would more than offset an estimated 448,000-unit rise in home sales, based on the average forecast of the National Association of Realtors, the Mortgage Bankers Association and Fannie Mae.
Bottom In Home Prices, a Decade Away MKC Global Humans are an optimistic breed by nature. There are some pessimists (or “realists” as they prefer to be called) among us; but on balance humans believe in a better future. This ensures that investment professionals will continue to track investor psychology for many years to come. When the naturally optimistic demographic becomes a group of Doom and Gloomers (or vice versa), we take notice. The same is true for participants in the real estate as well as stock markets.
Flipping Foreclosures: Will 90-Day Rule Waiver Ease Crisis? U.S. Housing officials hope to ease the impact on communities hardest hit by foreclosures with a one-year waiver of its rule against providing FHA-insured mortgages on homes resold within 90 days. Beginning Monday, Feb. 1, its good news for flippers – investors who acquire below-market properties that often need improvements, then quickly attempt to sell for a profit. They will now have a much larger pool of potential buyers – those first-time homebuyers or others who need the backing of the Federal Housing Administration, FHA, to qualify for a mortgage.
Lenders Pursue Mortgage Payoffs Long After Homeowners Default By Kathleen M. Howley -- Jan. 28 (Bloomberg) -- When John King stopped making payments on his home in Coral Gables, Florida, two years ago, he assumed the foreclosure ended his mortgage contract, he said. Last month, a Miami-Dade County court gave collectors permission to pursue him for $44,000 stemming from the default. King is among a rising number of borrowers who are learning that they can be on the hook for years after losing their homes. Amid a crisis that stripped $6.4 trillion, or 28 percent, from the value of U.S. residential real estate since the 2006 peak, lenders are exercising their rights to pursue unpaid mortgage balances. To get their money, they can seize wages, tap bank accounts and put liens on other assets held by debtors.
Obama Says Republicans Can Help End Washington’s ‘Sour Climate’ By Nicholas Johnston and James Rowley -- Jan. 30 (Bloomberg) -- President Barack Obama engaged in an unusual public debate with House Republicans yesterday, challenging them to help end the “sour climate” in Congress and defending his agenda for the economy and health care. Obama delivered remarks to the Republicans’ annual retreat, then answered sometimes pointed questions from the lawmakers over almost 90 minutes at a hotel in Baltimore, a session that was televised at the administration’s suggestion.
Colorado's share of stimulus so far: $3.36 billion Denver Business Journal Colorado was awarded $3.36 billion in federal stimulus funds during 2009, the U.S. government reported Saturday. The amount received to date, however, is considerably less: $953 million. The stimulus package was signed into law by President Barack Obama in Denver nearly a year ago. The data just released covers Feb. 17 through Dec. 31. Colorado recipients of stimulus funds received 738 contracts valued at $1 billion, 2,079 grants worth $2.36 billion and two loans for $584,000.
Turning union cash to ash By Nolan Finley Union greed has dismembered Michigan Legend has it that during a brutal contract bar -gaining session, Harry Bennett, Hen-ry Ford's enforcer, attempted to break the tension by passing around snapshots taken during a visit to Maxon Lodge, a gorgeous hideaway in the woods of northern Michigan. Walter Reuther, architect of the United Auto Workers' rise, looked over the photographs, tossed them on the table and said to Bennett: "Come the revolution, we'll own that place." It was no idle threat. In 1967, flush with cash from a bulging membership, the UAW purchased the lodge and 1,000 acres on Black Lake.
Tesla to stop selling electric sports car next year It sounds like the initial public offering of electric-car maker Tesla is already being greeted with skepticism, but some of the fine print about its plans may give potential investors even greater cause for concern. A reading of the fine print by Wired's Autopia blog uncovers some disturbing product-planning news. To wit, the company's only product, the first true freeway-capable, mass-produced electric car of the modern age, will go bye-bye next year.
Detroit bomb attempt alters sports security By Howard Fendrich AP The massive, multimillion-dollar security operations for the Super Bowl and Winter Olympics are being adjusted in light of recent breaches such as the attempted Christmas Day bombing of an airliner and the White House party crashers. Sports and government officials say such lapses -- where individuals got past guards on the ground -- are leading to increased screening efforts at major upcoming events, including the NFL championship game between the Indianapolis Colts and New Orleans Saints in Miami next Sunday and the Winter Olympic Games, which start Feb. 12 in Vancouver, British Columbia.
Peres' Iranophobia rhetoric begins to sway IAEA chief Israeli President Shimon Peres has verbally attacked Iran during his first meeting with the new chief of the UN nuclear watchdog, claiming that it poses a threat to the entire world. Peres made the remarks on Saturday in a meeting with International Atomic Energy Agency Director General Yukia Amano on the sidelines of the World Economic Forum in Davos, Switzerland, the Israeli daily Haaretz reported.
Bankers at Davos Face Global Ire By MARCUS WALKER And EMMA MOODY - WSJ DAVOS, Switzerland—Not so long ago, financiers ruled the roost at the glitzy annual gathering of the global economic elite here in the Swiss Alps. At this year's of the World Economic Forum, the unofficial theme seems to be "First, kill all the bankers." The ire directed at bankers from all sides is palpable, acknowledged Donald Moore, chairman of Morgan Stanley in Europe, as he stood alone reading some charts amidst the hubbub at the forum's Global Village cafe. Asked which other groups of people have been similarly unpopular in Davos in the past, he said: "terrorists." The quip reflects the mounting alarm with which bankers have come to view their besieged profession—even in Davos, a usually cozy gathering.
Should Germany bail out Club Med or leave the euro altogether? By Ambrose Evans-Pritchard - Telegraph -- Germany faces a terrible dilemma. Either Europe's paymaster agrees to underwrite a Greek bail-out and drops its vehement opposition to a de facto EU economic government, treasury, and debt union, or the euro will start to unravel, and with it Germany's strategic investment in the post-war order. The spike in yields on 10-year Greek bonds to 400 basis points above German Bunds has been shockingly swift – a warning to Britain, too, that markets can suddenly strike any country that takes creditors for granted. We can argue over whether Greece, Portugal, or Spain are at risk of being forced out of the euro. But there is another nagging question: whether events will cause Germany and its satellites to withdraw, bequeathing the legal carcass of EMU to the Club Med bloc.
Clinton to work with Russia on European security PARIS (Reuters) - Secretary of State Hillary Clinton on Friday recommitted the United States to the defense of Europe and pledged to work with NATO allies and former foe Russia to boost security in the face of new threats. "European security remains an anchor of U.S. foreign policy," Clinton told a conference during a visit to France, which last year rejoined the command structure of the North Atlantic Treaty Organization (NATO). Clinton's speech was aimed at reassuring Washington's European allies of continued U.S. commitment in the face of a sometimes strained relationship with Russia, which still sees the former Soviet bloc as part of its sphere of influence.
China Bosses Davos as Nobody Discusses What Happened to Google By Rob Delaney and Ari Levy -- Jan. 30 (Bloomberg) -- Google Inc.’s opposition to censorship in China was the one topic left off the table in Davos -- at China’s request. “China didn’t want to discuss Google,” Josef Ackermann, chief executive officer of Deutsche Bank AG and a co-chairman of this year’s World Economic Forum, said in an interview. China’s Vice Premier Li Keqiang made that clear, he said. “Google has backed off a little bit.”
U.S.-China Relations Cool on Arms Deal By ANDREW BROWNE And JASON DEAN - WSJ BEIJING—China's suspension of military exchanges with the U.S. in retaliation for a $6.4 billion arms sale to Taiwan heightens the risk of friction between Beijing and Washington at a time when they are already at loggerheads over a host of security and economic issues. China announced the freeze on military exchanges Saturday, and summoned the U.S. ambassador to Beijing for a formal complaint, following the Obama administration's announcement Friday that it is proceeding with the sale of antimissile systems, helicopters and other arms to Taiwan.
Aerospace sector fears China sanctions Beijing’s reaction to Taiwan arms deal stirs US concern By Kevin Brown in Singapore, Kathrin Hille in Beijing and Daniel Dombey in Washington - Reuters -- Aerospace executives and the US government reacted with concern on Sunday to a Chinese threat to impose sanctions on American groups involved in a $6.4bn arms deal with Taiwan. Giovanni Bisignani, director-general of the International Air Transport Association, the global airline industry body, called for fresh talks between Beijing and Washington to avert a crisis over the arms package.
U.S. Starts to Push Back Against China in Growing Rift By HELENE COOPER - NYTimes WASHINGTON — For the past year, China has adopted an increasingly muscular position toward the United States, berating American officials for the global economic crisis, stage-managing President Obama’s visit to China in November, refusing to back a tougher climate change agreement in Copenhagen and standing fast against American demands for tough new Security Council sanctions against Iran.
Taiwan has guns, beef — and politics By Sol Sanders - Washington Times President Obama's Chinese New Year's gift, an arms purchase offer even with a $6.4 billion price tag, couldn't be more welcome to Taiwanese President Ma Ying-jeou. Last March his Kuomintang swept back into office with anti-corruption slogans, promising better relations with the Gigantest Panda across the Taiwan Strait. That peaceful transition reconfirmed for 23 million Taiwanese the first representative government in Chinese civilization's vaunted 5,000-year history. But now the Mandarin-accented, Hong Kong-born, sleek politician's polls are drooping.
Davos Dispute Escalates as Policy Makers, Bankers Square Off By Simon Kennedy and Christine Harper -- Jan. 30 (Bloomberg) -- Policy makers pushed back at bankers who have warned of excessive and uncoordinated attempts to toughen financial regulation as they jostled for control of an industry that required an unprecedented government bailout. Bank chief executive officers, led by Josef Ackermann of Deutsche Bank AG, are scheduled to meet privately today with finance ministers and central bankers to keep talks on track and assert their influence on the penultimate day of the World Economic Forum annual meeting in Davos, Switzerland.
No chance of Greek default: EU Clara Ferreira-Marques - Reuters Almunia says Greece will not leave euro zone A top European Union official said on Friday there was no risk that Greece would default or leave the euro zone and the country's finance minister said he was not aware of any bailout talks. “No, Greece will not default. Please. In the euro area, the default does not exist because with a single currency the possibility to get funding in your own currency is much bigger,” monetary affairs commissioner Joaquin Almunia told Bloomberg TV. “There is no bailout problem.”
Dollar to Rally as Greece’s ‘Stone Age’ Looms By Inyoung Hwang Jan. 29 (Bloomberg) -- The dollar will benefit as a potential “financial stone age” for Greece and other nations threatens to break up the euro, according to Walter J. Zimmermann Jr., chief technical analyst at United-ICAP. The greenback may rise to a level last reached more than six years ago against the currencies of major U.S. trading partners as the European budget crisis reduces demand for higher-yielding assets, according to Zimmermann, whose firm is a technical research unit of ICAP Plc, the world’s largest inter- dealer broker.
How the Greek leader forgot about his debt crisis By Edmund Conway - Telegraph What do you do if your country is in economic crisis, when you have a self-acknowledged “credibility deficit”, when you may have to resort to an emergency International Monetary Fund loan – oh, and you happen to be in Davos – the ideal place to meet world leaders and bankers to sort it out? If you’re George Papandreou, the answer is you hole yourself up in a small cinema watching clips from Avatar for two hours.
Nato chief: more casualties and violence in Afghanistan in 2010 By Rosa Prince - Telegraph The newly-appointed Nato civilian representative in Afghanistan has warned that 2010 will bring "many more" casualties and an “awful lot of violence” in the fight against the Taliban. But Mark Sedwill, the senior British diplomat who will represent the coalition in non-military matters, predicted that this year would also see a turning point in the conflict, as Nato beefed up its strategy politically and in terms of its fighting force. Predicting that troops would be fighting for between three and five more years, he told the BBC’s Andrew Marr show: "This year will be another very challenging year.
The Quigley Formula - Part 1 of 8 A lecture by G. Edward Griffin on the New World Order. He explains in detail how they are organized, and how they have infiltrated all of the power centers of the Western world and are the real people that control our countries. They are quickly moving us into a one world government. This is a truly eye opening presentation
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