Weekday NEWS to Comfort the Disturbed and Disturb the Comfortable.
Thurs 04.01.2010
The coming inflation wave By Daryl G. Jones (Fortune) -- Whether the American economy is in an inflationary or deflationary environment sounds like it should be a fundamental and settled question. But due to the unprecedented financial crisis, the answer is actually subject to intense debate among economists. Making economic projections is far from a scientific process, so it's not surprising to find valid arguments on both sides of the divide. The economists who are right will help investors drive returns over the next three years.
incoming … $3T Quasi-Public Derivatives Bomb By John M. - HousingDoom.com If I understand how Fannie and Freddie worked in the good old days when there was a pretense they were private for-profit companies, their business model was to have a gigantic book of very high quality 30-year conforming fixed rate mortgages that the home-owner could pay out early at little or no penalty (so they wouldn't be locked into their home for 30 years, could move to a better job, trade up, et cetera).
U.S. Standard of Living Unsustainable Without Drastic Action, Former Top Govt. Accountant Says by Heesun Wee - TechTicker.com -- Who will bail out America? A longtime budget hawk and currently CEO of the Peter G. Peterson Foundation, David Walker says America's growing long-term debt is dangerously close to passing a "tipping point" that could trigger soaring interest rates and a plummeting dollar. In a worst case scenario, that could trigger a "global depression," he says, warning: "Nobody's going to bail out America." With the U.S. facing $50 trillion in unfunded liabilities and around $62 trillion in total long-term debt, what worries Walker most is what happens after the recession dissipates, as detailed here. "I'm less concerned with the short-term deficits than I am the fact that we're not doing anything about those structural deficits that people used to call long-term," says Walker, former U.S. Comptroller General and head of the Government Accountability Office. "But the long-term is here."
Mind-Boggling Budget Deficit By The Mogambo Guru - The DailyReconing.com 03/31/10 Tampa, Florida – In one of my worse nightmares coming true, my boss “stopped by” my office with some security camera footage of me allegedly coming to work where I am obviously but allegedly drunk as a skunk and allegedly belligerent, although there is no sound track to confirm this, towards the other employees also allegedly coming in to work, where I am allegedly and seemingly yelling at them in a spittle-drenched rage that they are idiots because they are not buying gold, silver and oil in response to the treacherous Federal Reserve creating so much money so that the desperate Obama administration can destroy us with monstrous deficit-spending and create catastrophic inflation in prices, which, unfortunately, doesn’t work well as a YouTube video without any soundtrack, even though there was this one fabulous scene where I, in a breathtaking pantomime, grabbed my genitals, ripped them off, stretched them into a noose around my neck and hung myself, and which is, ya gotta admit, not quite the perfect metaphor, but a very memorable one, especially since they both have the same ultimate effect! Hahaha!
Credit Crisis, Outrage, Far From Over Bob Chapman - SilverBearCafe.com The re-nomination of Ben Bernanke, as Chairman of the Federal Reserve, has to be one of the ultimate political insults, particularly coming from Republicans, as did his predecessor, Alan Greenspan, both have taken America and the world down the sewer. Ben Bernanke saved Wall Street, the banks, insurance companies and a myriad of other Illuminist firms. This is the same Ben who refused to release records to uncover where $2 trillion had gone in the loan program that followed the collapse of Lehman Brothers. This is an appellate defeat for the Fed. We would expect they will next appeal to the Supreme Court. This is important to the Fed, because a loss would not only expose which institutions were insolvent, US and foreign, but it would expose what collateral was accepted for these so-called loans, and have they been paid back?
HAMP to the Rescue By MIKE WHITNEY - CounterPunch.org Is it a Fix for Housing or Another Big Bank Bailout? Last Friday, the Obama administration announced changes to its Home Affordable Modification Program (HAMP) The most significant change is "principal reduction". By reducing the balance on underwater loans, the administration hopes to lower the number of foreclosures which have soared to more than 300,000 per month. This looks like a plan that could work, since most foreclosures are the result of negative equity or unemployment. If the banks and other investors agree to the terms of the program (and it looks like they will) then more homeowners will be able to avoid foreclosure, prices will stabilize, and the recovery will gain momentum. There is one drawback, however, which is moral hazard writ large. The new program rewards the speculators who bet on dodgy investments and who'll be able to exchange their garbage securitizations for government-guaranteed FHA loans.
Would the Founders Love ObamaCare? By DANIEL HENNINGER - WSJ.com The resistance to ObamaCare is about a lot more than the 10th Amendment The left-wing critics are right: The rage is not about health care. They are also right that similar complaints about big government were heard during the New Deal and the Great Society, and the sky didn't fall. But what if this time the sky is falling—on them. What if after more than a century of growth in the national government, starting with the Progressive Era, the American people are starting to push back. Not just the tea partiers or the 13 state attorneys general seeking protection under the 10th Amendment and the Commerce Clause. But something bigger than that.
Enemies of the state By Monica Crowley - WashingtonTimes.com Administration smears some opponents, arrests others During President George W. Bush's two terms, you couldn't drive far without seeing a particular bumper sticker: "Dissent is the highest form of patriotism." Now that Democrats control the White House and Congress, the left treats dissent as the lowest form of treason. When the left agitates over government policies, it's considered righteous anger. When the right - and much of the center - agitate, it's painted as the rantings of the criminally and violently insane. With Obamacare signed into law, Democrats have stopped congratulating themselves long enough to notice that the American people aren't cheering on the sidelines. According to a CNN poll released last week, 58 percent oppose President Obama's handling of Obamacare, while Gallup shows him this week with a 46 percent job approval, his lowest yet. A CBS poll released after the House of Representatives passed Obamacare showed Speaker Nancy Pelosi's favorable rating at 11 percent and Senate Majority Leader Harry Reid's at 8 percent, higher only than Beelzebub's.
A Grotesquerie Steve Forbes With an ice-cold disdain for public opinion and an obsession worthy of Lenin, President Obama and Speaker Nancy Pelosi rammed ObamaCare through the House by unprecedented parliamentary trickery, bribery and deceit. The President has thereby poisoned the national political well. But the health care fight has just begun. Substantive constitutional court challenges are coming. Congressional elections are around the corner, and there's a growing opposition that wants to undo what Obama has just done. The President will discover that, ultimately, the American people's tenacity will overwhelm his--and he will be a failed President. But the cost of his public-be-damned attitude will be immense.
Gold Prices on Move NEW YORK (TheStreet) -- Gold prices Wednesday were rising after a disappointing U.S. ADP unemployment number boosted demand for the alternative investment. Gold for June delivery was adding $9.30 to $1,115 an ounce at the Comex division of the New York Mercantile Exchange. Prices Wednesday traded as high as $1,119.90 and as low as $1,103.10. The U.S. dollar index was slipping 0.62% to $80.97. Gold's spot price was up over $11 a troy ounce, according to Kitco's gold index.
The Coming Precious Metals Short Squeeze John Rubino - SilverBearCafe.com With the gold price suppression scheme apparently breaking open - see this article and this interview - the question becomes when, not if, holders of futures contracts will start demanding physical delivery. Most will discover that the metal isn't there, which will, ahem, unsettle the commodity and currency markets. This impending bullion bank disaster is a victory for GATA and its allies, who have been tilting at this windmill for what seems like forever. The Collapse of the Dollar, for instance, contains a long chapter titled the "The Great Central Bank Short Squeeze" in which James Turk, writing in 2004, lays out the evidence for central bank gold manipulation and makes some predictions about what we're likely to see when the scam is exposed:
100 to 1 Leverage. World’s Largest Fraud Exposed. By: plunge - The Seminal JP Morgan Chase Caught Manipulating Gold & Silver Market GATA has been exposing the manipulation of gold and silver pricing for the past several years. A total mainstream media blackout is in progress at this moment following mind-blowing revelations made at last weeks CFTC hearing – a complete debacle for the New World Order banksters. Andrew Maguire is an independent metals trader turned whistle blower at the center of a storm for exposing what is the largest fraud in history involving countries, banks and government leaders. This interview blows the lid off the global scheme to cap gold and silver prices to support the fiat currency regime.
Asia physical demand supports gold at $1,100 By Jeffrey Nichols - CommodityOnline.com Gold managed to end last week over the psychologically important $1,100 level, after briefly falling to an intraday low of $1,085 an ounce last Wednesday. This recovery reflects an apparent resolution of the Greek sovereign debt crisis, bringing with it a stronger European currency, a weaker U.S. dollar and a bounce in the dollar-denominated price of gold. The unexplained sinking of a South Korean naval ship late last week gave gold an additional boost . . . and serves as a reminder that scared money still looks to gold for safety and security at times of heightened geopolitical uncertainty.
Chasing the Gold Standard Linda Brady Traynham - SilverBearCafe.com I suppose it is an article of faith here in the Bar that the first nation to adopt a true gold standard is going to have a commanding advantage internationally? If not, it is here in the Whiskey Redan, deep in the heart of Texas. A "redan," you will recall, is a fortification with only three corners, and I chose the term partially because Gary had already snagged "the Whiskey Bunker" and to allow myself to define what the three most important factors are easily, according to my whim of the moment. Today I'm going to go with "God, Gold, and Guns," which you will notice is in alphabetical order. We don't discuss religion in the Bar, politics and economics being quite controversial enough, so that leaves us with Gold and Guns.
Buying China? Buy Gold by Adrian Ash - SafeHaven.com Wanted to buy China's growth story but didn't know how...? The WORLD GOLD COUNCIL'S excellent new 74-page report on Chinese gold demand - Gold in the Year of the Tiger - contains many graphics, tables and charts. . . . . . . . Over the last 5 years - and correlated against the Shenzhen and Shanghai stock markets - gold has in fact been more tightly linked with the "China story" than with either crude oil or the GSCI commodities index.
Gold and Indexes Melt Up Into Earnings? by Chris Vermeulen - SafeHaven.com Gold and the stock market continue to trade within a tight range this week. While the long term trend for both stocks and metals are up, and the charts look bullish I am not buying at this level because the market is over bought. Chasing prices higher especially after a run this large is not the right move in my opinion. I did mention last week that we could see stocks continue to grind higher going into earning season which is about 2 weeks away still. I think that could happen, and if the same thing happens which we saw last January with great earnings (which I think we will see again) then watch out for another drop.
China's demand for gold 'will double' John Galt - SilverBearCafe.com One paragraph from the March 29th U.K. Telegraph article says more than any pessimist about the metal ever could: Over the past five years, China's demand for gold has increased at an average rate of 13pc per annum, the council said. But it said Chinese "consumption intensity" lagged substantially behind other major markets and that, while China was the world's sixth largest official holder of gold, its gold reserves currently accounted for less than 2pc of total reserves, which was "low" by international standards. But the vice-governor of the China's central bank said in December that Beijing would not buy gold indiscriminately.
Doubt and Uncertainty Are Commonplace By: Mary Anne Aden and Pamela Aden Most people seem to be confused these days. This not only applies to investors, but to everyday folks across the spectrum. People hear one thing, but they see another. Doubt and uncertainty are, therefore, fairly common. This is not unusual. The times are uncertain. Unprecedented historical events are taking place. And even though many aren’t aware of the details, a majority of nearly 90% feel that the U.S. government is broken. They know things aren’t right, so this leads to confusion. We know by your letters that’s how some of you are feeling and we totally understand why. This tells us that it’s a good time to stand back and review some basics…
Federal Reserve Literally Killing Our Money By Mogambo Guru - DailyReckoning.com.au As much as I scream in Loud Mogambo Outrage (LMO) about the sheer amount of money that is being created that will create horrendous inflation in prices, using whatever data that I can easily get my hands on or, better yet, falling into my lap, or, as a last resort, just making up facts and figures to prove my point, I may, for once in my over-the-top, obnoxious and irritating life ("The Way Of The Mogambo (TWOTM)"), be understating the case! Understating it! James Turk of Goldmoney.com notes, "There has been an unprecedented amount of deposit currency created by the Fed over the past two years. From December 2002 until the collapse of Lehman Brothers in September 2008, the quantity of deposit currency created by the Fed averaged $11.8 billion, an amount that is relatively insignificant compared to total M1. Presently, it stands at a record high of $1,246.2 billion, which of course is highly significant."
China reviews yuan policy The StraitsTimes.com SHANGHAI - THE Chinese government is reviewing proposals to adjust its currency exchange rate system next month, Chinese media reported, as international pressure grows on Beijing to revalue the yuan. The proposals include giving the yuan a more flexible exchange rate by widening the Chinese currency's narrow daily trading band, the weekly Caijing Magazine reported in its latest issue, citing unnamed sources. Currently the yuan may rise or fall 0.5 per cent against the dollar each day from a mid-point set by the central bank and three percent for non-dollar currencies such as the euro and Japanese yen.
US, China change tone but... The StraitsTimes.com WASHINGTON - WEEKS after warning that ties were in disarray, China is signaling a readiness to work with the United States but fresh disputes could set back relations just as quickly, analysts say. China on Monday praised the 'positive attitude' of President Barack Obama after he voiced support for a greater relationship with the rising Asian power in receiving its new ambassador. The calls for cooperation come despite two angry Chinese protests since the beginning of the year after Mr Obama approved an arms package to Beijing's rival Taiwan and met with Tibet's exiled spiritual leader the Dalai Lama.
Mr. Hu, Tear Down This Wall! by John Browne Over two thousand years ago, China began to build its Great Wall in order to keep nomadic tribes and marauding armies from crossing its borders. In the last few decades, China has built another protective barrier, a 'Great Firewall,' to keep socially disruptive web content from reaching its citizens. American companies have long acquiesced to this censorship charade in order to have access to China's booming online market. Last week, Google changed its mind, shutting down its regulated site on the mainland and redirecting people to its uncensored Hong Kong portal. This laudable act of defiance indicates that China's bustling marketplace is straining its authoritarian political regime. We expect the latter to yield.
US's Geithner confident China will move on currency PITTSBURGH, March 31 (Reuters) - U.S. Treasury Secretary Timothy Geithner expressed confidence on Wednesday that China will decide it is in its interest to make its yuan currency more flexible, but did not say when that might happen. "I am very confident that they are going to decide it is in their interest to move on currency reforms," Geithner told reporters after touring a steel plant and meeting with steel executives and union leaders.
China: The Bursting of a Super-Bubble By Vitaliy N. Katsenelson - The DailyReckoning.com 03/31/10 Denver, Colorado - The world looks at China with envy. China’s economy grew 8.7 percent last year, while the world economy contracted by 2.2 percent. It seems that Chinese “Confucian capitalism” – a market economy powered by 1.3 billion people and guided by an authoritarian regime that can pull levers at will – is superior to our touchy-feely, democratic capitalism. But the grass on China’s side of the fence is not as green as it appears. In fact, China’s defiance of the global recession is not a miracle – it’s a “super-bubble.” When it deflates, it will spell big trouble for all of us.
Geithner to Discuss Economy, Investment in India MoneyNews.com Treasury Secretary Timothy Geithner will discuss economic stability, financial investment and building up infrastructure with Indian officials when he visits India next week, a U.S. official said Wednesday. Geithner will meet with Indian Prime Minister Manmohan Singh and take part in the first meeting of a new U.S.-Indian economic panel in the capital New Delhi and also will visit Mumbai, the financial center, a senior Treasury Department official said Wednesday. The vice chairman of the Federal Reserve, Donald Kohn, also will be on the trip. The April 6-7 visit is part of a U.S. effort to deepen the relationship with India, the world's largest democracy and most stable U.S. ally in a hostile corner of the globe.
To rob a country, own a bank
To rob a country, own a bank Pt2
To rob a country, own a bank Pt3
To rob a country, own a bank Pt4
To rob a country, own a bank Pt5
PIMCO fears UK 'debt trap' By Ambrose Evans-Pritchard - Telegraph.co.uk The US bond fund PIMCO has warned that Britain risks a vicious circle of rising debt costs as global investors demand a penalty fee on gilts to protect against inflation. Bill Gross, the fund's chief and emminence grise of bond vigilantes, said the UK was on its list of "must avoid" countries along with Greece and others in eurozone's Club Med. The flood of British debt is likely to "lead to inflationary conditions and a depreciating currency", lowering the return on bonds. "If that view becomes consensus, then at some point the UK may fail to attain escape velocity from its debt trap," he wrote in his April monthly note.
Judge wants to bar Citizens Bank's Michaels brothers By: Steve Daniels - ChicagoBusiness.com (Crain's) — Robert and George Michael, the brothers who launched Citizens Bank & Trust Co. of Chicago a decade ago, would be permanently barred from the banking industry under a recommendation from an administrative judge to the Federal Deposit Insurance Corp. A 142-page proposed ruling, issued last week, found that the brothers, who also are real estate developers, violated banking laws and regulations to enrich themselves. The recommendation now goes to the FDIC board, which will render a final decision.
Geithner says economy slowly on mend PITTSBURGH (Reuters) - The economy is still in a tough spot but is gradually regaining its balance after a series of policy mistakes that made the country weaker and less secure, Treasury Secretary Timothy Geithner said on Wednesday. "We are coming back, and we are coming back faster and stronger than most people predicted -- faster and stronger than Europe and Japan," Geithner said after meeting with steel executives and union leaders here. The Treasury chief made a quick trip to Pittsburgh, a former steelmaking center, to highlight improving prospects for the hard-hit manufacturing sector and to urge lawmakers to agree to measures for reining in financial firms that were at the heart of the financial crisis.
Preparing for the Fed's Exit from the Mortgage Market: Yield Spreads by Adam Quinones - MortgageNewsDaily.com -- The Federal Reserve's MBS Purchase Program comes to an end today. Mortgage market participants must now face the reality of a life without the supportive, flow balancing, volatility calming bid of the Federal Reserve. It's time to ensure everyone's knowledge base is adequately prepared to explain some of the factors that will be moving mortgage rates over the next few days, weeks, and months. Without going into servicing valuations and best execution options, mortgage rates are generally dependent upon the mortgage basis. The mortgage basis can be generally thought of as a guidance giver for mortgage rates. This requires a proper explanation of yield spreads....
Blinder Weighs In on Debate Over Fed Powers By David Wessel What exactly should Congress ask the Federal Reserve do and what should be done by other arms of the government? It’s a question Congress is contemplating now as it rewrites the rules of finance in light of the wrenching financial crisis. Writing in the March 2010 issue of the American Economic Association’s Journal of Economic Literature, Alan Blinder — a Princeton economist who was for a time vice chairman of the Federal Reserve Board — says the Fed should “monitor and regulate systemic risk because preserving financial stability is (a) closely aligned with the standard objectives of monetary policy and (b) likely to require lender of last resort powers,” which the Fed holds uniquely. Siding with Fed Chairman Ben Bernanke, Blinder says the Fed should supervise large financial institutions because they are so integral to systemic risk.
Greece Plans Global Bond Sale By NICK SKREKAS and COSTAS PARIS - WSJ.com Greece hopes to raise between $5 billion and $10 billion with a global bond in late April or early May and is planning to market it to investors in the U.S. and Asia, a senior Greek government official said Wednesday. "We want to diversify our issuance," said the official, who asked not to be identified. "Until now the vast majority of issuance was in euros. We will do a dollar bond with roadshows in the U.S. and Asia and hope to raise between $5 billion and $10 billion."
Moody's downgrades Greek banks AFP - Telegraph.co.uk Moody's, the International ratings agency, on Wednesday downgraded five Greek banks by one notch due to a weakening in their financial strength and the country's difficult economic outlook. Moody's said it downgraded their deposit and debt ratings due "to a weakening in the banks' stand-alone financial strength and anticipated additional pressures stemming from the country's challenging economic prospects in the foreseeable future." It named the banks as the National Bank of Greece, EFG Eurobank Ergasias, Alpha Bank, Piraeus Bank and Emporiki Bank of Greece.
U.S. to sell entire stake in Citigroup in 2010 Treasury may net more than $7 billion in profit after bailing out bank WASHINGTON AP - Bank bailouts are turning out to be great business for the government. Unfortunately for taxpayers, other federal rescues will almost certainly wind up in the red. The Treasury Department said Monday it will begin selling its stake in Citigroup Inc. at a potential profit of about $7.5 billion — not a bad haul for an 18-month investment. The move is a major step in the government's effort to unravel investments it made in banks under the $700 billion Troubled Asset Relief Program at the height of the financial crisis.
Fed Opens the Books on Bear, AIG Toxic Assets By SERENA NG And CARRICK MOLLENKAMP - WSJ.com The Federal Reserve Bank of New York lifted a veil of secrecy on the troubled mortgage assets it purchased as part of the 2008 rescues of Bear Stearns Cos. and American International Group Inc. The disclosures listed scores of subprime residential mortgage securities and pieces of commercial loans made to dozens of properties across the country, such as the Crossroads Mall in Oklahoma City—featuring the city's only indoor full-size carousel—and the Hilton Garden Inn in Panama City, Fla.
Oil Prices Find a Sweet Spot for World Economy By CLIFFORD KRAUSS - NYTimes HOUSTON - Oil prices have done something remarkable over the last half-year or so: they have barely budged. Memories are still fresh of the chaotic climb to $147 a barrel only two summers ago, accompanied by gasoline costing $4.11 a gallon. The spike led to accusations from drivers and politicians that oil companies were price-gouging. Then crude prices plummeted along with the economy, to around $34 a barrel just over a year ago, only to double again in a matter of months as confidence began to recover.
Drilling plan opens new areas but halts Alaska sales By Kara Rowland and Stephen Dinan, THE WASHINGTON TIMES Obama gets slick with oil energy gambit President Obama's new offshore drilling plan opens up some new areas for oil and gas exploration but also cancels some Alaska lease sales planned for the next two years, putting billions of barrels of oil out of reach for now. The long-awaited plan, announced Wednesday, expands drilling opportunities off the coast of the southern Atlantic seaboard, in the Gulf of Mexico and some parts of Alaska, but halts other future sales in Alaska's Chukchi and Beaufort seas that drilling advocates say could account for far more oil than the new areas the president proposes to open up.
Obama opens coastal areas to drilling By Kara Rowland President Obama, making good on a nearly two-year-old campaign promise, said Wednesday the U.S. government will open up huge areas of the country's outer continental shelf to offshore drilling for oil and natural gas. Calling it a tough decision, Mr. Obama gave his blessing to oil and natural gas drilling along swaths of the Atlantic coastline, the eastern Gulf of Mexico and the north coast of Alaska. But he said specific areas would be protected, such as Alaska's Bristol Bay. The announcement comes as gasoline prices creep toward $3 a gallon — up a dollar since Mr. Obama took office a year ago.
Obama to allow drilling off Virginia coast By ASSOCIATED PRESS WASHINGTON (AP) -- In a reversal of a long-standing ban on most offshore drilling, President Barack Obama is allowing oil drilling 50 miles off Virginia's shorelines. At the same time, he is rejecting some new drilling sites that had been planned in Alaska. Obama's plan offers few concessions to environmentalists, who have been strident in their opposition to more oil platforms off the nation's shores. Hinted at for months, the plan modifies a ban that for more than 20 years has limited drilling along coastal areas other than the Gulf of Mexico.
BP Begins Big Push to Revive Iraq's Oil By RUSSELL GOLD - WSJ.com BP PLC Tuesday awarded $500 million in contracts to drill wells in Iraq's giant Rumaila oil field, the first step in a mammoth initiative by foreign oil companies to revive the country's energy industry. If successful, the effort at Rumaila and several other fields near Basra could be one of the largest expansions of crude-oil production ever achieved anywhere. Increased Iraq production could be the difference between a well-supplied global market with oil steadily trading below today's $82 a barrel and a tight oil market with triple-digit prices, struggling to meet rising Asian demand.
Time to Storm the Castle? By NICK TIMIRAOS And JAMES R. HAGERTY - WSJ.com At the High End, a Bit More Money Yields Lots More Home; 14 Acres and an Orchard Daniel Horowitz is ready to bargain. The 55-year-old trial lawyer is trying to sell a four-bedroom villa with marble imported from Italy, a winery and a fruit orchard on 14 acres in Lafayette, Calif. Mr. Horowitz already chopped the price to $3.2 million from $4 million, the amount he estimates having spent on the land and construction. "We thought it would sell right away," he says. But it hasn't, and he is willing to consider lower offers, he says.
As Fed's mortgage purchases end, eyes turn to investors By Nathaniel Popper - LATimes.com Hope is that private money will again flow into housing market. Reporting from New York - The government's $1.25-trillion program to prop up the housing market by purchasing mortgages came to an end Wednesday -- in a small, messy room at the Federal Reserve Bank of New York with four desks and a Nerf basketball hoop. For the last year, a small team of traders has worked here to buy massive amounts of mortgages to fill the void left after institutional investors quickly retreated in the throes of the 2008 financial crisis, unable or unwilling to put money into the fast-melting mortgage arena.
Housing crisis turns some suburban neighborhoods into ghost towns LATimes.com -- There are hundreds of stories about how the housing crisis has affected people who have lost their homes --- but what about the people left behind? Eddie and Maria Lopez can tell you that the flight of families who have walked away or been foreclosed on has completely changed their small gated community in Hemet. When they moved in, they were enticed by the ducks walking around the development, the lakes, the pool and clubhouse. Families held parties during the holidays; kids would play together on the street. But homes in the gated community of Willowalk plummeted in value -- the Lopezes' home went from $440,000 to $169,000 -- and families began leaving in droves.
Bankrupt Subprime Mortgage Lender Fremont Settles $89m Tax Dispute by AUSTIN KILGORE - HousingWire.com -- Bankrupt subprime lender and servicer Fremont General will settle more than $89m in tax obligations to the Internal Revenue Service (IRS) without actually paying a majority of the back taxes. Last week, the U.S. Bankruptcy Court for the Central District of California, Santa Ana Division approved a motion that allows Fremont General to claim a net operating loss (NOL) deduction for 2004 that’s attributable for its 2006 tax obligations, according to a regulatory filing with the Securities and Exchange Commission (SEC).
Irish bailout fallout -- in Buffalo? By Colin Barr (Fortune) -- Citigroup is not the only big bank that may soon have a flood of shares hitting the market. M&T (MTB), the big Buffalo-based regional bank lauded by Warren Buffett, could also have a big chunk of its shares for sale. The bank's biggest shareholder, Allied Irish Banks (AIB), set plans Tuesday to sell its stake in M&T by year-end after Irish regulators told it to fill a $10 billion capital hole. Allied Irish holds nearly a quarter of M&T's stock, and a sale would raise $2.1 billion at current prices. A big stake in M&T, the 28th-biggest U.S. bank holding company and one of the industry's strongest players, could draw attention from expansion-minded banks overseas.
Fearful, angry Latinos might shun Census Esteban Israel (Reuters) - Latinos are the biggest minority in the United States but they could jeopardize a chance to flex their newfound political muscle as millions of them dodge a nationwide census. Many of the millions of illegal Hispanic immigrants fear that filling in the 10-question census forms could increase their risk of deportation. Others are frustrated with President Barack Obama's slow start on immigration reforms. A poll by the Pew Research Center showed that one-third of Hispanics have not even heard of the 2010 Census, a $14 billion effort to map the nation's population.
A Census of the Census - WSJ.com (PDF) April 1 is National Census Day, marking the final stretch before forms are due April 12. Which states have the best track record for returning forms? And which age group is most frequently left out?
Trying to Escape the Surveillance State By DAN FLETCHER - Time.com Britain is one of the world's leading surveillance states. Privacy International, an advocacy group, ranks the U.K. right behind flagrant offenders like Russia and China. But such concerns didn't hit home for British filmmaker David Bond until the U.K. government lost a slew of data on his newborn daughter. In response, Bond decided to see what it would take to escape detection for a month in his data-happy homeland. The experiment turned into a documentary, Erasing David, now available for download from iTunes and Amazon.com. Bond sat down with TIME to talk about his film.
The Hutaree Among Us: By Steven Gray / Clayton, Mich. - Time.com A Michigan Town in the Glare Last Saturday, black humvees suddenly appeared in Clayton, Mich. By Sunday evening, helicopters were hovering over the small village, a 90-minute drive southwest of Detroit. "It was weird, like in a movie," recalls Dale Robinson, 59, a displaced autoworker and one of Clayton's 300 or so inhabitants. During the previous week, there had been a rumor — no one knew who started it — that residents should keep their doors and windows locked. Some residents figured an inmate might have escaped from the nearby state prison. It turns out all the commotion was over a group whose alleged leader lived in a double-wide trailer that sits down the gravel road from the local wiring plant where he worked.
Ready for Your Biometric Social Security Card? By Katy Steinmetz - Time.com Could a national identity card help resolve the heated immigration-reform divide? Two Senators, New York Democrat Chuck Schumer and South Carolina Republican Lindsey Graham, certainly seem to think so. They recently presented an immigration-bill blueprint to President Barack Obama that includes a proposal to issue a biometric ID card — one that would contain physical data such as fingerprints or retinal scans — to all working Americans. The "enhanced Social Security card" is being touted as a way to curb illegal immigration by giving employers the power to quickly and accurately determine who is eligible to work. "If you say [illegal immigrants] can't get a job when they come here, you'll stop it," Schumer told the Wall Street Journal. Proponents also hope legal hiring will be easier for employers if there's a single go-to document instead of the 26 that new employees can currently use to show they're authorized to work.
Boeing Expects $150 Million Health-Care Charge By TESS STYNES - WSJ.com Boeing Co. expects to take a $150 million charge against first-quarter earnings because of recent government health-care changes, the latest in a line of companies to do so. The Chicago-based aircraft maker and defense contractor said it expects the charge to reduce first-quarter earnings by 20 cents a share.
Some Seniors Fear Obamacare Will Kill Medicare MoneyNews.com Seniors aren't breaking out the champagne for President Barack Obama's healthcare law, and for good reason. While Democrats hail the overhaul as their greatest healthcare achievement since Medicare, seniors fear it's a raid on that same giant healthcare program — a bedrock of retirement security — in order to pay for covering younger, uninsured workers and their families. There's no doubt that broad cuts in projected Medicare payments to insurance plans, hospitals, nursing homes and other service providers will sting. What hasn't sunk in yet is that the new law also improves the lot of many Medicare beneficiaries. Obama is hoping that most will eventually conclude the plusses outweigh the minuses.
Sarah Palin Goes to War: Go for It? Hell, Yes! By Mark Halperin - Time.com After signing his landmark health care measure into law and restoking the fires of his presidency, Barack Obama took a victory lap in Iowa on March 25 and dared Republicans to put health care repeal at the center of their 2010 campaigns with the cheeky challenge "Go for it." Sarah Palin jumped in with both high-heeled feet and a rallying cry the equivalent of "Hell, yes!" In Washington, many Republican leaders are now waffling and wavering over their previous aggressively negative stance on the health care bill, seeing peril in opposing the measure's more popular provisions. They are searching for a more nuanced and modulated message that will allow them to avoid the damning Party of No label, while still making their principles clear. But Sarah Palin doesn't really do nuance or modulation. Defiance is more her style, and this past weekend she used her folksy brand of full-throated opposition to dominate American politics yet again with appearances in Arizona and Nevada. The lady from the frozen north happens to be one heck of a Sun Belt candidate, and within the conservative movement she has unmatched national appeal.
David Walker: Health Care Reform Savings "Misleading," But Not Double-Counted by Peter Gorenstei - TechTicker.com -- Health care reform is now law but the arguing between Democrats and Republican over the costs is likely to last well into the November midterm elections. The non-partisan Congressional Budget Office concluded the House version of the $940 billion bill passed into law would cut $138 billion off the federal deficit over the next 10 years. Republicans don't buy it and say the law will bankrupt the country.
Origin and Rise of Compulsory Medicine Mises Daily: by Melchior Palyi Obligatory health insurance started moderately enough — in Prussia. Compulsion under a law of 1845 was left in the hands of municipal administrations, with no government subsidy involved and no contributions from employers. The antisocialist law of 1878 suppressed many of labor's voluntary associations for sickness benefits. The next step was the governmentalization of the associations' functions.
A Constitutional Convention Can Rein in Washington By JAMES M. LEMUNYON - WSJ.com There's no need to fear crazy amendments since the results would have to be approved by 38 states. The U.S. Congress is in a state of serious disrepair and cannot fix itself. It has reached this point over the course of many years—in fact over many decades. Regardless of the party in power, Congress has demonstrated a growing inability to effectively address the major issues of our time, including soaring federal debt and the extension of federal authority to states and localities. The only effective remedy is constitutional reform to rein in congressional excesses and abuses. But Congress can't be expected to propose amendments to fix itself, as it has an inherent conflict of interest.
Naomi Wolf Thinks the Tea Parties Help Fight Fascism Justine Sharrock - SilverBearCafe.com Is She Onto Something or in Fantasy Land? Naomi Wolf, author of 'End of America,' talks about why she has become an improbable Tea Party darling, and if progressives can learn from the conservative activists. In her bestselling End of America, Naomi Wolf outlines the 10 warning signs that America is headed toward a fascist takeover. Using historical precedents, she explains how our government is mimicking those of Mussolini, Hitler and Stalin through practices like surveillance of ordinary citizens, restricting the press, developing paramilitary forces and arbitrarily detaining people.
Health insurers anemic since passage of overhaul By Russ Britt, MarketWatch Big names feel the effect, depending on Medicare exposure LOS ANGELES (MarketWatch) -- The past 10 days have not been kind to the nation's biggest health insurers. Since the U.S. House of Representatives passed a health-care overhaul measure, such names as UnitedHealth Group Inc., WellPoint Inc., Humana Inc., Cigna Inc. and Coventry Health Care have been mostly anemic, dropping sharply or bumping along a flat line. But others in the same sector, including such names as Aetna Inc. and smaller-cap stocks like Amerigroup Corp. and Centene Corp., have prospered somewhat.
Cities look to debt collectors for help By David Ellis - CNNMoney.com NEW YORK (CNNMoney.com) -- In the northeastern Pennsylvania town of Pittston, the seemingly manageable issue of garbage became a much bigger problem than anyone could have ever anticipated. While the streets were hardly strewn with litter, the city of 8,100 is now saddled with roughly $250,000 worth of unpaid garbage fees owed by city residents. Hoping to stamp out the problem, the city council recently contracted with an outside collection agency, hoping to recoup some of the outstanding debt.
Private Payrolls Dropped in March By CONOR DOUGHERTY And JEFF BATER - WSJ.com Factory Orders Increased Last Month Private payrolls fell in March, according to data released Wednesday. The news rattled investors and economists who had expected March would show a gain in payrolls. Separately, U.S. factory orders posted stronger than expected gains in February, indicating a building momentum in manufacturing that could translate into gains for production and the broader economy. Private-sector jobs in the U.S. dropped by 23,000 this month, according to a national employment report published Wednesday by payroll giant Automatic Data Processing Inc. and consultancy Macroeconomic Advisers.
U.S. companies unexpectedly cut 23,000 jobs in March Bloomberg News - LATimes.com The decline is the smallest in two years and 1,000 fewer than in February, ADP Employer Services says. A gain of 40,000 jobs had been forecast. Private companies in the United States unexpectedly cut payrolls in March, according to new data. The 23,000 decline was the smallest in two years and followed a revised 24,000 decrease in February, ADP Employer Services said Wednesday. Over the previous six months, ADP's initial figures have overstated the Labor Department's first estimate of private payroll losses by as little as 2,000 in February to as much as 151,000 in November.
US job market remains stagnant By James Quinn - Telegraph.co.uk The US labour market continues to stagnate with few positive signs, following news that the private sector shed 23,000 jobs in March. Economists had estimated that the ADP payroll survey for March would show a gain of 40,000-50,000 jobs, but the loss compounded fears that employment figures will be the last part of the US economy to rebound. However, ADP did make a positive revision to its February numbers, from a loss of 40,000 to a loss of 24,000. The ADP number is seen as a key indicator ahead of the US government's official labour market data, due to be published on Good Friday, which will show how many jobs have been created or lost in the public and private sector.
Tussle over health care law impact on companies By Ben Rooney NEW YORK (CNNMoney.com) -- A growing number of major U.S. corporations are expecting to take tax charges in the first quarter related to the recently enacted health care reform law. But while some companies are fretting about the charges, defenders of the law say the new rules merely close a loophole that allowed a double-dip benefit. On Wednesday, Boeing (BA, Fortune 500) became the latest company to disclose that the law, which was signed by President Obama last week, will negatively impact its financial results. The aeronautics company expects to take an income tax charge of roughly $150 million, or 20 cents per share, in the first quarter of 2010 as a result of the law.
A Second Big Bang In Geneva? By MICHIO KAKU - WSJ.com The Large Hadron Collider could unlock the secrets of genesis. Champagne bottles were popped Tuesday in Geneva where the largest science machine ever built finally began to smash subatomic particles together. After 16 years—and an accident that crippled the machine a year and a half ago—the Large Hadron Collider successfully smashed two beams of protons at the astounding energy of 3.5 trillion electron volts apiece. This act produced temperatures not seen since the Big Bang occurred 13.7 billions years ago. The LHC is colossal. It is a gigantic doughnut, 17 miles in circumference, in which two beams of protons will eventually create energies of 14 trillion electron volts. Yet by nature's standards the LHC is a pea shooter. For billions of years the earth has been bathed in cosmic rays much more powerful than those created by the LHC.
Law Firm Implicates Pope, Vatican In Abuse Case Lawyers Claim Head Of Roman Catholic Church Knew Of Ernesto Garcia-Rubio Sex Abuse Case Miami AP -Lawyers representing an alleged victim of sex abuse claim the Vatican instructed church officials in Florida to shelter a priest from Cuba who was later accused of pedophilia. Attorney Jessica Arbour, who represents an alleged victim of the Rev. Ernesto Garcia-Rubio, released a 1968 letter from the Vatican to the Archdiocese of Miami, stating the cleric had been forced to leave Cuba "because of serious difficulties of a moral nature (homosexuality)."
Vatican Offers 3 Reasons It's Not Liable For Abuse VaticanCity AP Dragged deeper than ever into the clerical sex abuse scandal, the Vatican is launching a legal defense that it hopes will shield the pope from a lawsuit in Kentucky seeking to have him answer attorneys' questions under oath. Court documents obtained Tuesday by The Associated Press show that Vatican lawyers plan to argue that the pope has immunity as head of state, that American bishops who oversaw abusive priests weren't employees of the Vatican, and that a 1962 document is not the "smoking gun" that provides proof of a cover-up.
A New Middle East War? By CONN HALLINAN - CounterPunch.org Israel Threatens Lebanon When Israeli Minister without Portfolio Yossi Peled said recently that a war with Lebanon’s Hezbollah was “just a matter of time” and that such a conflict would include Syria, most observers dismissed the comment as little more than posturing by a right-wing former general. But Peled’s threat has been backed by Israeli military maneuvers near the Lebanese border, violations of Lebanese airspace, and the deployment of an anti-missile system on Israel’s northern border. The Lebanese are certainly not treating it as Likud bombast.
Iranian nuclear scientist defects to U.S. By ASSOCIATED PRESS - WashingtonTimes.com An Iranian nuclear scientist who had been reported missing since last summer has defected to the U.S. and is assisting the CIA in its efforts to undermine Iran's nuclear program, ABC News reported Tuesday. The scientist, Shahram Amiri, has been resettled in the U.S., according to the report. The CIA had no comment on the report, a spokesman said.
Obama demands deadline for Iran By Kara Rowland - WashingtonTimes.com Sarkozy also backs sanctions President Obama on Tuesday said the international community needs to impose fresh sanctions if Iran fails to come clean on its nuclear program by this spring, injecting a new sense of urgency into the push to reel in that nation's suspected weapons program. In a joint appearance with visiting French President Nicolas Sarkozy, Mr. Obama said the U.S. and its allies are "working diligently" on the matter in the wake of an expired deadline for action he set for Tehran last year.
China supports Barack Obama's call for new Iran sanctions Julian Borger and Ewen MacAskill - guardian.co.uk Fresh sanctions against Iran moved closer yesterday, when China agreed to begin drafting a UN resolution imposing measures aimed at persuading Tehran to curb its nuclear programme. Last night, Hillary Clinton, the US secretary of state, said the five permanent security council members plus Germany "continues to be unified" in talks on sanctions. "There will be a great deal of further consultation not only among the [six], but other members of the security council and other [UN] member nations during the next weeks," she said.
Obama imposing a Palestinian state By Victor Kotsev - AsiaTimes "US President Barack Obama's demands during his meeting with Prime Minister Benjamin Netanyahu last Tuesday point to an intention to impose a permanent settlement on Israel and the Palestinians in less than two years," the Israeli daily, Ha'aretz, wrote on Monday. We may draw a similar conclusion from analyses such as the one by Tony Karon in Asia Times Online. United States-Israel rifts have widened to the point where the BBC recently reported that the US would "seriously consider abstaining" if the United Nations Security Council were to vote on a resolution on Jerusalem (presumably against Israel). US officials promptly denied the report, but in any case, the US is pushing extraordinarily hard a literal interpretation of "the 1967 border". This is a strong indicator that Obama might secretly hope to impose a solution.
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