Our age is retrospective. It builds the sepulchres of the fathers. It writes biographies, histories, and criticism. The foregoing generations beheld God and nature face to face; we, through their eyes. Why should not we also enjoy an original relation to the universe? Why should not we have the a poetry and philosophy of insight and not of tradition, and a religion by revelation to us, and not the history of theirs? Embosomed for a season in nature, whose floods of life stream around and through us, and invite us, by the powers they supply, to action proportioned to nature, why should we grope among the dry bones of the past, or put the living generation into masquerade out of its faded wardrobe? The sun shines today also. There is more wool and flax in the fields. There are new lands, new men, new thoughts. Let us demand our own works and laws and worship.
- Ralph Waldo Emerson, Nature
I believe we have finally breached the tipping point in the socio-political landscape of the United States of America. There will be no going back from here. Everyone on all levels of society including the elites must make a choice. Will you stand for real reform and an end of the feudalistic rule of the oligarchs and their paid-off puppets that line the streets of Washington D.C., or will you keep your mouth shut and play the old and dying game in the context of a completely different cultural environment? While many will disagree with what I am about to say, I believe the oligarchs and the Federal Reserve have already lost. This will not be clear to the vast majority at this time because the powerful institutions that dominate and rob us will continue to fight for survival but the wind is already blowing in a different direction and cannot be reversed. The smart elites are starting to see this and are hedging their bets. The dumb or stubborn ones may want to start looking at countries with non-extradition treaties or start blowing the whistle on someone above them and fast. The window of opportunity to make the choice is closely quickly. "I was just following orders" will not cut it when the dollar collapses and Disneyland shuts down. There have not been any major arrests and people have seemingly gotten away with all their frauds and crimes. This too will change and 2011 will represent a change in trend in this regard. We have entered the terminal phase of this ponzi scheme economy and those responsible for its creation and its continued support at the expense of the vast majority of the populace will see their foul deeds rise to the surface.
Debtors repent by walking away, not by paying off 'New frugality' a deception
By Patrice Hill - The Washington Times
A common refrain these days is that Americans are learning to save more and spend less, depending less on credit cards and unsustainable increases in mortgage debt to finance lifestyles that many can't afford.
The unprecedented debt splurge of the past decade was a major cause of the financial crisis and recession, while the sluggish recovery is blamed on the hangover from that debt binge as consumers cut back on spending and try to pay off debt. Household debt has fallen by a record $900 billion since 2008, while the savings rate is up to a healthy 6 percent.
Baby Boomers: Get Out of the Stock Market Now, the Rug is Being Pulled Out By Insiders CNBC reports insider selling-to-buying ratio for top firms is a staggering 3177 to 1
By Eric Blair - ActivistPosts.com
If you're a baby boomer who still believes in the stock market since the financial collapse of 2008, listen up. The floor of this Ponzi scheme is about to drop out, leaving you punching a clock for some time to come and holding an empty retirement bag for your effort. The engineered crash is coming and the elite are jumping ship in droves -- you should join them and get out ASAP.
Stock market insider selling has now reached record highs. The trend has been increasing for the last several years, but now the ratios are getting beyond ridiculous.
Signs Hyperinflation Is Arriving
by Gonzalo Lira This post is gonna be short and sweet - and scary:
Back in late August, I argued that hyperinflation would be triggered by a run on Treasury bonds. I described how such a run might happen, and argued that if Treasuries were no longer considered safe, then commodities would become the store of value.
Such a run on commodities, I further argued, would inevitably lead to price increases and a rise in the Consumer Price Index, which would initially be interpreted by the Federal Reserve, the Federal government, as well as the commentariat, as a good thing: A sign that "the economy is recovering", a sign that "normalcy" was returning.
An Open Letter to Washington: How to Fix the Deficit and End the Bush-Tax-Cuts Debate
BY MARTIN HUTCHINSON, Contributing Editor, Money Morning .... this is a tax we can live with
Dear Mr. President and members of Congress:
In the months that follow Tuesday's midterm elections, and into the New Year, you all face three very significant challenges. You must:
Find a solution to the Bush-tax-cuts controversy.
Rein in the huge-and-growing U.S. budget deficit.
And better police Wall Street, which got us into this mess in the first place.
You can solve all three of these problems with a single, simple proposition. And you can do so without having to ask U.S. taxpayers to dig into their wallets or savings.
Let me explain.
The scary actual U.S. government debt
Neil Reynolds - TheGlobeAndMail.co.uk
Boston University economist Laurence Kotlikoff says U.S. government debt is not $13.5-trillion (U.S.), which is 60 per cent of current gross domestic product, as global investors and American taxpayers think, but rather 14-fold higher: $200-trillion - 840 per cent of current GDP. "Let's get real," Prof. Kotlikoff says. "The U.S. is bankrupt."
Writing in the September issue of Finance and Development, a journal of the International Monetary Fund, Prof. Kotlikoff says the IMF itself has quietly confirmed that the U.S. is in terrible fiscal trouble - far worse than the Washington-based lender of last resort has previously acknowledged. "The U.S. fiscal gap is huge," the IMF asserted in a June report. "Closing the fiscal gap requires a permanent annual fiscal adjustment equal to about 14 per cent of U.S. GDP."
Investors in Riskier Bonds May Not be Coming Back
By Stephen Fidler - WSJ.com
Governments on the edges of the euro zone face a serious new challenge: the prospect that investors who have shunned their bonds in recent months may abandon them for good.
While European leaders continue to say that all euro-zone government debts will be paid in full and on time, most big investors don't believe them. A survey of 582 investment institutions, carried out by Barclays Capital and released last week, showed 82% of them expected either debt restructuring, default or a full-fledged euro-zone crisis.
But the shift out of government bonds of Greece, Portugal, Ireland and even Spain is not just to do with the fear that investors will not be repaid in full and on time. It has also happened because the violent price shifts that have taken place over the last year mean that their bonds have lost many of the characteristics that most big bond buyers are seeking. "I think the biggest structural shift has been in market volatility," says Arif Husain, director of U.K. and European fixed income at AllianceBernstein, the asset-management firm.
EU 'haircut' plans rattle bondholders Investors face large potential losses on eurozone debt under German plans likely to win backing from EU leaders on Friday - risking a boycott of Greek, Irish, and Portuguese bonds.
By Ambrose Evans-Pritchard, and Bruno Waterfield in Brussels - Telegraph.co.uk
Germany has agreed to give the EU's Û440bn (£383bn) bail-out fund permanent status rather than letting it expire in 2013 as planned, but only as part of a "Crisis Resolution Mechanism" that forces bondholders to share losses from any future bail-outs. The fund must be anchored in EU law through changes to the Treaties in order to head off legal challenges at Germany's constitutional court.
A draft proposal from Berlin - now serving as a working text for the European Commission - calls for "orderly insolvency" by eurozone countries in trouble. Details are sketchy but this "Chapter 11" for sovereign states would include an extension of debt maturities, a "holiday" on interest payments for as long as needed to let debtors recover, and a suspension of bondholder rights. The blueprint is akin to debt-restucturing schemes used by the International Monetary Fund.
China is key to next rally in gold prices
By David Hale - FT.com
The recent gold price rally is the first stage of a multi-year bull market that will drive the gold price to at least $2,000 an ounce by 2015. A mixture of economic factors and innovations in how institutions can purchase the metal have moved prices. But the biggest driver of gold prices is yet to come.
First, a recap of the factors that have taken gold prices to current levels.
The economic causes centre on monetary policy and the risk of inflation. Some industrial countries are striving to devalue their currencies and will use monetary policy to support the goal. Japan recently spent $24bn on unsterilised intervention trying to weaken the yen. The policy succeeded, albeit briefly. In 2003-04, Japan spent more than $350bn on intervention and could easily do so again. This policy would increase dollar liquidity while nurturing more monetary growth in Japan itself.
CURRENCY WARS: Debase, Default, Deny!
By Gordon T Long - GoldSeek.com
In September 2008 the US came to a fork in the road. The Public Policy decision to not seize the banks, to not place them in bankruptcy court with the government acting as the Debtor-in-Possession (DIP), to not split them up by selling off the assets to successful and solvent entities, set the world on the path to global currency wars.
By lowering interest rates and effectively guaranteeing a weak dollar through undisciplined fiscal policy, the US ignited an almost riskless global US$ Carry Trade and triggered an uncontrolled Currency War with the mercantilist, export driven Asian economies. We are now debasing the US dollar with reckless spending and money printing with the policies of Quantitative Easing (QE) and the expectations of QE II. Both are nothing more than effectively defaulting on our obligations to sound money policy and a "strong US$". Meanwhile with a straight face we deny that this is our intention.
Hedging strategies to underpin rising Gold price
The Gold Report with Tan Khandaker - CommodityOnline.com
.... we are bullish on gold because we believe that global economic turbulence is still not under wraps. We believe it's going to take at least 24 to 48 months, if not longer, to stabilize economic volatility around the world and, principally, in Europe and North America. While that's going on, we believe issues with currencies and inflation will be key catalysts for the gold price. Inflationary pressure on low interest rates is basically going to drive the gold price in a positive direction as a standard hedging strategy, if not a safe haven for investors.
Gold vs. the Fed: The Record Is Clear There were no world-wide financial crises of major magnitude during the Bretton Woods era from 1947 to 1971.
By CHARLES W. KADLEC - WSJ.com $$
When it meets next week, the Federal Open Market Committee (FOMC) is widely expected to signal its desire to increase the rate of inflation by providing additional monetary stimulus. This policy is based on a false - and dangerous - premise: that manipulating the dollar's buying power will lead to higher employment and economic growth. But the experience of the past 40 years points to the opposite conclusion: that guaranteeing a stable value for the dollar by restoring dollar-gold convertibility would be the surest way for the Federal Reserve to achieve its dual mandate of maximum employment and price stability.
From 1947 through 1967, the year before the U.S.
began to weasel out of its commitment to dollar-gold convertibility, unemployment averaged only 4.7% and never rose above 7%. Real growth averaged 4% a year. Low unemployment and high growth coincided with low inflation. During the 21 years ending in 1967, consumer-price inflation averaged just 1.9% a year. Interest rates, too, were low and stable - the yield on triple-A corporate bonds averaged less than 4% and never rose above 6%.
Vietnam to curb transactions based on gold by banks
MUMBAI (Commodity Online): State Bank of Vietnam is considering imposing restrictions on transactions based on gold by the commercial banks in order to bring down the domestic gold prices.
According to reports, transactions such as lending, borrowing and dong denominated loans on gold by the commercial banks are expected to be banned this week. However, local banks are now allowed to include up to 30 percent of their gold deposits for making loans.
DEBT BUBBLES AND THE BULL MARKET FOR COMMODITIES
Submitted by Frank Holmes - FinancialSense.com
The "World's Greatest Investment Event," the 2010 New Orleans Investment Conference kicked off on Wednesday as gold and natural resources investors descended on the Crescent City for answers to today's market questions.
The list of speakers for this year's conference reads like a who's who of the natural resources and commodity world - Dr. Marc Faber, Newt Gingrich, Dennis Gartman, Dick Armey, Peter Schiff and others.
We know everyone can't make it down to the conference this year, so we're going to be sharing some of the highlights with you over the next couple of days.
Rick Rule, chairman of Global Resource Investments, Ltd., was first to speak Thursday morning and he had a clear message for the audience: We're in a bull market for commodities and natural resources. Rule said that the easy money, what he called "riskless" money, has been made, but the "big" money is still out there.
Silver Short Position Could Cost JP Morgan Billions in Losses
NationalInflationAssociation - Inflation.us
It was just announced late Wednesday that two lawsuits have been filed in Manhattan federal court against JP Morgan and HSBC Holdings Inc. accusing them of manipulating the price of silver by "amassing enormous short positions". The suits were filed by Brian Beatty and Peter Laskaris, who each claim they lost money trading COMEX silver futures and options contracts as a result of JP Morgan's alleged manipulation.
In NIA's latest documentary 'Meltup' that was released on May 13th, 2010, and has now been viewed by over 855,000 people, NIA's President Gerard Adams exposed the manipulation of silver that has been taking place by JP Morgan. Mr. Adams discussed in detail in 'Meltup' how on March 14th, 2008, the very day Bear Stearns failed was the same day silver reached a multidecade high of about $21 per ounce. According to Mr. Adams, Bear Stearns was on the verge of being forced to cover their naked short position in silver, which could have quickly sent silver as high as $50 per ounce. This would have caused a loss of confidence in the U.S. dollar and a possible currency crisis. Instead of allowing this to happen, the Federal Reserve orchestrated a bailout of Bear Stearns and JP Morgan acquired their assets with the backing of the Fed. Shortly after taking over Bear Stearn's silver short position, JP Morgan was able to manipulate the price of silver down to below $9 per ounce.
Goldman: "The Dollar Needs To Fall A Lot Further From Here"
Submitted by Tyler Durden - ZeroHedge.com
In today's note by Goldman's Robin Brook, the analyst takes an inverse approach of looking at what a dollar drop implies for CPI and general prices, in an attempt to settle a debate whether the expected drop in the USD as a result of QE2 will have a meaningful impact on both inflation, currency wars, and other derivatives of monetary policy. As Goldman concludes: "the 'pass-through' from Dollar declines to US consumer price inflation is small. This in turn means that - if indeed the Fed sees the Dollar as one of its key policy levers for preventing inflation from staying below its mandate for a prolonged period - the Dollar needs to fall a lot further from here." The quantification of "lot" is not provided but is sufficiently indicative from a qualitative standpoint. Of course, the biggest issue here is with the construction of CPI itself, which is driven far more by a collapse in leveraged input prices specifically as pertains to shelter, then spiking prices in items most see as critical in day to day use. Nonetheless, as Goldman is one of the Primary Dealers whose opinion is now a part of the "reverse inquiry" methodology in determining monetary policy, the fact that the hedge fund is comfortable with a substantial drop in the USD implies that the Fed should be just as comfortable with a shock and awe approach to QE2, as a pronounced effect on the dollar would likely have to come from a stepwise drop as opposed to a gradual wear down which would be intercepted by other central banks. The key question remains: what level on the DXY is Goldman, and thus the Fed comfortable with as ""modestly inflation stimulating, and what will the price of jeans be, gold, and other commodities be, not to mention what the final level of excess reserves and margins for Chinese exporters, once that level is finally attained.
Fed expected to make big bond buy; what will impact be?
By Paul Davidson, USA TODAY The Federal Reserve next week is expected to give the economy the equivalent of a B-12 shot.
But many economists question whether it will be enough to perk up a listless recovery. Others say it ultimately will lead to rampant inflation.
Based on its signals since August, the central bank Wednesday will likely announce a new round of government bond purchases to lower long-term interest rates and stimulate economic growth. It would be the Fed's most aggressive bid to rev up the economy since it bought $1.7 trillion in bonds starting in early 2009 in the financial crisis.
Bernanke's Learn as you Go Approach
Written by Bruce Krasting - OilPrice.com
Jon Hilsenrath at the WSJ has been THE mouthpiece for Bernanke for the past few months. Bernanke has been telling him what is on his mind and Jon prints it. That the debate on monetary policy is being conducted like this has been one of the big mistakes at the Fed this fall. Today Hilsenrath has leaked more of the maestro's thinking. This time it is a big shocker to me. Bernanke has apparently heard all of the opposition to his mega QE-2 plan, and he has changed the scope of QE-2 as a result. From the Journal today:
The central bank is likely to unveil a program of U.S. Treasury bond purchases worth a few hundred billion dollars over several months.
Bernanke's Reluctance to Speak Out Rankles Some
By SEWELL CHAN - NYTimes.com
WASHINGTON - The Federal Reserve is all but certain next week to begin a multibillion-dollar effort to coax the recovery along, but privately, Ben S. Bernanke, head of the agency, worries that more is needed to turn the sluggish economy around and revive employment.
He says he believes that without the Obama administration's $787 billion stimulus program, the nation would have been worse off, and that Congress needs to continue to prop up the economy in the short run. He agrees that fiscal measures to support the recovery would probably make the Fed's unconventional monetary policy more potent.
THE CREATURES FROM JEKYLL ISLAND WITHIN US ALL
Submitted by Ryan Jordan - FinancialSense.com
Judging from the amount of reprints of G. Edward Griffin's "The Creature from Jekyll Island: A Second Look at the Federal Reserve" (which are 27 as of 2010), more than a few people have taken notice of Griffin's argument to abolish the Federal Reserve. Griffin depicts the establishment of the Federal Reserve by globalist bankers as an illegal act to wrest away economic freedom from average Americans. The initial creation of the Fed was done far away from the view of the public, at a remote beach resort in Jekyll Island, Georgia in 1910 (three years prior to the bank's founding). Griffin's story certainly takes on a conspiratorial tone, by which I mean that Griffin focuses on secretive forces colluding to do something that is not in the best interests of the majority of American citizens.
Imminent Big Bank Death Spiral
By: Jim Willie CB, - GoldSeek.com
The mortgage & foreclosure scandal runs so deep that ordinary observers can conclude the US financial foundation is laced with a cancer detectable by ordinary people. The metastasis is visible from the distribution of mortgage bonds into the commercial paper market, money market funds, the bank balance sheets, pension funds under management, foreign central banks, and countless financial funds across the globe. Some primary features of the cancerous tissue material are mortgage bond fraud, major securities violations, absent linkage to property title, income tax evasion, forged foreclosure documents, duplicate property linkage to single mortgage bonds, NINJA (no income, no job or assets) loans to unqualified buyers, and more. In fact, more is revealed it seems each passing week toward additional facie to high level and systemic fraud. The world is watching. The growing international reaction will be amplified demand for Gold, from recognition that the USDollar & USEconomy have RICO racketeering components extending to Wall Street banks and Fannie Mae mortgage repositories.
THE ONE-SIDED COMPROMISE
Submitted by John Browne - FinancialSense.com
Last weekend, the G-20 finance ministers met in South Korea to find areas of agreement in preparation for the main G-20 gathering in November. The Chinese rebuffed renewed American pleas for them to revalue their yuan. They rejected Secretary Geithner's suggestion of a four percent cap on current account surpluses. However, in return for accepting America's continued dollar debasement, the Chinese did agree to "look into" a revaluation of the yuan and the management of trade surpluses. They also agreed to an international self-policing regime to curb currency manipulation. This 'one-sided' compromise was hailed in the Western media as a triumph for Mr. Geithner. The US stock markets and dollar rallied. All looked good for the election season in November.
'No time to be complacent,' IMF warns Canada
TAVIA GRANT - TheGlobeAndMail.com
Just because Canada weathered the recession better than most doesn't mean it can lower its guard. Slowing global demand, high household debt and a rising tide of protectionism could yet deliver sucker punches to an unsteady recovery.
That's the advice the International Monetary Fund gave Thursday as it presented conclusions from its mission this month to Canada. It cautioned that the country's economic growth has slowed lately and risks to its outlook are increasing.
European Union Tightens Rules Governing Euro
By STEPHEN CASTLE - NYTimes.com
BRUSSELS - The European Union approved plans to tighten the rules governing the euro early Friday, and said it would seek more changes and a limited alteration to the bloc's main treaty in December.
At a meeting in Brussels, the leaders of the 27-nation bloc approved a set of tougher budget rules, crafted by their finance ministers, which included new sanctions against eurozone states that fail to keep deficits and debt in check, and earlier warnings over asset bubbles and declining competitiveness.
Its declaration also said the union will consider ways to change the its governing treaty in December to set up a permanent fund to help Eurozone nations in times of crisis.
And the FAIR Tax Trap Democrats turn a conservative fad against GOP candidates.
WSJ.com - $$
Public anxiety over rising taxes is helping Republicans in this midterm election-with one exception. Democrats are trying to turn the tables on the GOP over the so-called FAIR Tax, a tax reform idea that has bounced around conservative circles for years.
The proposal would end all current federal taxes, junk the Internal Revenue Service and impose in their place a 23% national sales tax. In 16 House and three Senate races so far, Democrats have blasted GOP candidates for at one point or another voicing an interest in the FAIR tax. In Kentucky's Senate race, Democrat Jack Conway is running a TV spot charging that Republican "Rand Paul wants a new 23% sales tax on groceries, clothes, prescriptions, everything."
The Fed's 'tax on the consumer'
By Hibah Yousuf, - CNNMoney.com
NEW YORK (CNNMoney.com) -- Investors have been cheering about the prospect of the Federal Reserve pumping more money into the economy, but some experts warn that move may wind up hurting consumers' wallets.
Ever since Fed Chairman Ben Bernanke pledged in late August that the central bank would take "unconventional measures" to keep the economy afloat, the S&P 500 has climbed more than 11%.
Those 'unconventional measures' would likely be another round of asset purchases, known as quantitative easing, or QE2 for short. The move is designed to boost the economy and lower interest rates. But it would also add further pressure on an already weak U.S. dollar.
Your Savings Will Be Funding ForeclosureGate
By Daniel R. Amerman, CFA - GoldSeek.com Overview
As a result of apparent systemic incompetence coupled with fraud, it appears there is a chance that most real estate foreclosures may come to a screeching halt on a nationwide basis in the United States. What is missing from the headlines is the real impact on you and I, and how we will be the ones bearing the pain. To understand the implications of this extraordinary situation, we must first pierce a triple charade.
The first charade is the joke which the banking industry - and their regulators - in the United States has been making of contracts and the law. The second charade is the idea that the banks will bear the consequences for their gross negligence and lies, when in fact it is the US government and Federal Reserve that will be bearing the full costs (which is to say, you and I). The third charade is the idea that taxes will pay for these extraordinary expenses, when the only credible source of sufficient funds is ultimately the destruction of the value of the US dollar.
Triple Down: Fannie, Freddie, and the Triumph of the Corporate State
InstitutionalRiskAnalytics.com
In this issue of The Institutional Risk Analyst, we are going to slay a few dragons and eviscerate a few currently popular myths, but first let's start with two positive data points: (1) the strong results of Ford Motor Co (F) and (2) the continuing improvement of the smaller banks in the U.S. financial sector.
Yesterday F reported net earnings of $1.7 billion, or 43 cents per share for the third quarter, compared with last year's profits of 29 cents per share. More important, F is paying down debt and continuing the process of restructuring which began years ago. The moral to the story is that enterprises which restructure thrive and grow, while large banks and government sponsored entities that avoid restructuring shrink and increase the overall losses to the shareholders and society.
The Rule of Law and the Mortgage Mess The Chronicles of Atticus McShrugg
By David Knox Barker - GoldSeek.com
The Chronicles of Atticus McShrugg are fiction, but intended to give relevant, timely and sometimes entertaining perspective into current events in the global financial crisis and international political economy from a free market perspective. Atticus McShrugg is Special Assistant to the President of the United States, Director for Global Financial Market Stability. McShrugg boss is Admiral Clark, Deputy National Security Adviser for International Economic Affairs. For background on Atticus McShrugg, please see, Who is Atticus McShrugg?
It is just after 10:00 pm in the Oval Office, the President has just ended a meeting with Chairman Bernanke of the Federal Reserve Board and Timothy Geithner, Secretary of the Treasury regarding foreclosuregate. The President picks up the phone and dials Admiral Clark's office.
Can Mortgage Investors Force Banks to Buy Back Bad Loans?
By JENNIFER KHO - DailyFinance.com
More mortgage investors may soon join the fight to force banks to buy back bad loans, according to a Reuters story Thursday morning. According to the article, which cites an anonymous source, more than 50 large mortgage investors -- including Paulson, MetLife, Prudential and the Federal Reserve Bank of New York, met with securities attorneys David Grais and Talcott Franklin on Wednesday.
Homeowners Facing Foreclosure Demand Recourse
By ANDREW MARTIN and MOTOKO RICH - NYTimes.com
Ricky Rought paid cash to the Deutsche Bank National Trust Company for a four-room cabin in Michigan with the intention of fixing it up for his daughter. Instead, the bank tried to foreclose on the property and the locks were changed, court records show.
Sonya Robison is facing a foreclosure suit in Colorado after the company handling her mortgage encouraged her to skip a payment, she says, to square up for mistakenly changing the locks on her home, too.
Thomas and Charlotte Sexton, of Kentucky, were successfully foreclosed upon by a mortgage trust that, according to court records, does not exist.
Foreclosure Crisis Expands: More Urbanites Lose Their Homes
By THE ASSOCIATED PRESS - DailyFinance.com
The foreclosure crisis intensified across a majority of large U.S. metropolitan areas this summer, with Chicago and Seattle - cities outside of the states that have shouldered the worst of the housing downturn - seeing a sharp increase in foreclosure warnings.
California, Nevada, Florida and Arizona remain the nation's foreclosure hotbeds, accounting for 19 of the top 20 metropolitan areas with the highest foreclosure rates between July and September, foreclosure listing firm RealtyTrac said Thursday.
Those states saw housing values surge during the housing boom years. When the boom ended, values collapsed and foreclosures soared.
Who wins if foreclosures halted? Moratorium would impose huge losses on taxpayers, feds
By Patrice Hill - The Washington Times
Taxpayers and the federal government would be among the biggest losers if officials heed calls from some legislators and homeowners rights groups to stop millions of foreclosures across the country because of possible paperwork problems.
Fannie Mae, Freddie Mac and the Federal Housing Administration - already deep in red ink - back many of the defaulted loans and would sustain greater losses if foreclosures are delayed. The Treasury Department is majority owner of one of the biggest mortgage companies, Ally Financial, formerly GMAC, and would have to cover its losses, as well as Fannie's and Freddie's.
As Foreclosures Keep Coming, Renters Are Threatened Once Again
By BRUCE KENNEDY - DailyFinance.com
It's one of those stories that sounds appalling, that you might hope the media is playing up just for its shock value: responsible and conscientious tenants who suddenly find themselves evicted and out of a home -- because the property they are renting is under foreclosure.
At the start of the recession, reports of renters being blindsided by foreclosure notices were not unusual. The problem prompted President Obama to sign the federal Protecting Tenants at Foreclosure Act in 2009. It requires tenants receive a 90-day notice if they are being evicted due to foreclosure -- and that most existing leases for renters be honored up to the end of their term.
I was a robo-signer
By Tami Luhby - CNNMoney.com
NEW YORK (CNNMoney.com) -- It only took him a second to sign each foreclosure document.
That's how good Tam Doan got at his job in Bank of America's pre-sale foreclosure department in Southern California.
Of course, he didn't have time to actually read the paperwork he was signing, he said, and in some cases, he didn't even know what documents he was putting his pen to.
"I had no idea what I was signing," said Doan. "Either you were in or you were out."
The recent revelation that loan servicers had employees sign thousands of documents a month without verifying the information has thrown the foreclosure system into chaos. Judges are increasingly questioning whether the servicers have their paperwork in order.
Title insurers drop demands on mortgage lenders in foreclosure cases
By Elizabeth Razzi - Washington Post
Mortgage servicers have successfully pushed back an attempt to make them explicitly responsible for title problems resulting from their handling of foreclosure paperwork and legal procedures.
Three major title insurance companies - First American Financial, Old Republic International and Stewart Information Services - told Wall Street analysts in conference calls Thursday that they had decided not to demand written indemnifications from lenders re-selling foreclosed homes. Combined, the three companies account for 52 percent of the title insurance market.
Scary New Wage Data
By David Cay Johnston - Tax.com
Now for some really scary breaking news, from the latest payroll tax data.
Every 34th wage earner in America in 2008 went all of 2009 without earning a single dollar, new data from the Social Security Administration show. Total wages, median wages, and average wages all declined, but at the very top, salaries grew more than fivefold.
Not a single news organization reported this data when it was released October 15, searches of Google and the Nexis databases show. Nor did any blog, so the citizen journalists and professional economists did no better than the newsroom pros in reporting this basic information about our economy.
Germany Now Outsourcing Jobs to India, I Mean, Uh... America
By Justin Rohrlich - Minyanville.com
What happens when labor costs make it too expensive to manufacture your product domestically?
You outsource the work to India. Mexico. South Carolina.
Yes, that's exactly what it's come to, folks. BMW has opened a plant in Greer, South Carolina, where the workers earn half ($15/hr) what their German counterparts do.
"We are a low-wage country compared to Germany," Kristin Dziczek, director of the Labor and Industry Group at the Center for Automotive Research, tells the Washington Post. "And that helps put jobs here."
Sure, jobs are being created here. But they're here because wages, adjusted for inflation, have declined since 2003.
G.M. Moves to Clean Up Its Books Before I.P.O.
By NICK BUNKLEY - NYTimes.com
DETROIT - Preparing for its highly anticipated public offering next month, General Motors said on Thursday that it would repurchase $2.1 billion in preferred stock held by the federal government, contribute at least $6 billion to its pension plans and pay down debt to a health care fund for union retirees.
G.M. said it had also completed negotiations with banks on a $5 billion revolving credit line that would be a backup source of liquidity.
15 People Killed in Mexican Car Wash Massacre
By E. Eduardo Castillo, Associated Press
(AP) - Gunmen killed 15 people at a car wash Wednesday in a Mexican Pacific coast state where drug-gang violence has risen this year. It was the third massacre in Mexico in less than a week.
The gunmen in three vehicles drove up to the car wash in the city of Tepic and opened fire without provocation, said Fernando Carvajal, public safety secretary of Nayarit state, where the city is located. Fifteen men were killed and three people were injured.
The motive was not immediately clear but investigators suspect it was the work of organized crime, Carvajal told reporters.
Snitching in the Name of National Security
By Bill Bonner - The DailyReckoning.com
10/28/10 Baltimore, Maryland -
"Report Suspicious Activity. 1-800-XXX-XXXX"
"Terror Tips. Call 1-800-XXX-XXXX"
Hmmm ... What to make of it?
The War on Terror has been pushed out of the headlines by the war on the financial crisis. Besides, everyone was beginning to see that the war on terror was a fraud. You're never going to win a war against a tactic. And spending beaucoup money trying to win the hearts and minds of fanatics is a losing proposition.
But the war lives on. We have seen these signs at least 10 times in the last three days. They are up over 1-95 and US495 around Washington. What purpose do they serve? Has anyone ever called?
We would have called ourselvesÉand asked for a tip. But we were afraid of getting on a suspect list.
Preparing for a Mumbai-style Active Shooter
Kevin Hayden, Contributing Writer - Activist Post
Over the last few weeks, the mainstream media has capitalized on recent intelligence reports warning of a "Mumbai-style attack" in Europe. For those of you who are unfamiliar with the details of the Mumbai incident, several gunmen took over seemingly-random buildings, such as a large hotel, cafes, a movie theater and a children's hospital. Over the course of 3 days, they were able to kill 173 people, injure another 308 civilians and fend off police approaches with grenades and overwhelming firepower. After the attacks had finally been stopped, investigators learned that many of the gunmen had been injecting themselves with cocaine and steroids to remain alert and awake, some staying up for over 50 hours at a time.
Imagine a Columbine school event but with trained gunmen in a dense commerce area such as a mall, downtown business district or even a university. It could easily happen here in America.
65% Favor Getting Rid of Entire Congress and Starting Over
RasmussenReports.com
Let's face it: Most Americans don't have much use for either of the major political parties and think it would be better to dump the entire Congress on Election Day.
A new Rasmussen Reports national telephone survey finds that 65% of Likely U.S. Voters say if they had the option next week, they would vote to get rid of the entire Congress and start all over again. Only 20% would opt to keep the entire Congress instead. Fifteen percent (15%) aren't sure.
Why Business Should Fear the Tea Party
CEOs who complain about uncertainties caused by President Obama's policies aren't going to be happy about a new crop of congressman seeking to abolish the Fed.
By ROBERT B. REICH
America's business leaders have not exactly shied away from offering political views. Verizon CEO Ivan Seidenberg has accused President Obama of creating a hostile environment for investment and job-creation, while General Electric's Jeff Immelt says the administration is out of sync with entrepreneurs.
All of which makes particularly curious the deafening silence of business leaders about the tea party that's now taking over the GOP and about to take over a chunk of Congress. Maybe business leaders see it as a relatively harmless fringe group advocating the fiscally responsible small-government positions most CEOs agree with. Business leaders should take a closer look.
Nevada Secretary Of State Says No Evidence Of Vote Fraud
By Sean Whaley - NevadaNewsBureau.com
RENO - Secretary of State Ross Miller said today there have been no complaints filed with his office about suspicious voter activity despite email rumors and media accounts that at least some electronic voting machines are pre-programmed to support U.S. Senate candidate Harry Reid, D-NV.
Miller, holding the first of two media briefings on the allegations, urged anyone seeing a violation of election or voting law to file a formal complaint with his office so it can be investigated.
Residents cry foul over ballots
By: PETER HALL Bucks County Courier Times - PhillyBurbs.com
A trio of Bucks County residents backed by the county Republican committee say they have evidence linking Democratic Congressman Patrick Murphy's campaign to a scheme to flood the county voter registration office with fraudulent applications for absentee ballots.
In a petition filed Tuesday, county Republicans say the name of Murphy's campaign manager appeared on a Bristol post office box where voters were urged in a series of letters paid for by the state Democratic Committee to send absentee ballot applications.
A presidency heading for a fiscal train wreck
By Nouriel Roubini - FT.com
What has been the fiscal performance of President Barack Obama? He inherited the worst economic crisis since the Great Depression, as well as a budget deficit that - after much needed bail-outs and a series of reckless tax cuts - was already close to $1,000bn. His stimulus package, together with a backstop of the financial system, low rates and quantitative easing from the Federal Reserve, prevented another depression. Mr Obama also deserves credit that the US, alone among advanced economies, currently supports a "growth now", rather than an "austerity now" path.
But this is but one half of the picture; we must also judge his first two years on his ability to anticipate what the economy will need tomorrow. Here the picture is much less positive. Given the likely path of fiscal policy after next Tuesday's election - with the expiration of existing stimulus and transfer payments, and even with most of the 2001-03 tax cuts being kept - the US economy will soon experience serious fiscal drag just when it needs a further boost. Problematically, the administration's failures leave it relying on the Fed, which is bent on further QE, likely to be announced next Wednesday. But studies show this will have little effect on US growth in 2011, so fiscal policy should be doing some of the lifting to prevent a double dip recession.
Capitol Hill's 'Camelot' era coming to an end
Republican could replace last Kennedy in national office
By Seth McLaughlin - The Washington Times
EAST PROVIDENCE, R.I. | Two years ago, it would have been unthinkable that both seats held by Kennedy family members could be won by Republicans.
But Scott Brown's January election to Sen. Edward M. Kennedy's former Massachusetts seat paved the way, and now the GOP is hoping Rhode Island state Rep. John J. Loughlin II will give an encore performance in the race for the U.S. House seat held by Patrick J. Kennedy, the late senator's son, in Tuesday's election.
"What we are finding in Rhode Island is exactly what we found in Massachusetts during Scott Brown's election, and that is extreme voter unrest about the liberal, big-government, agenda that is bankrupting our nation," said Eric Fehrnstrom, the architect of Mr. Brown's win and now a strategist with the Loughlin campaign.
Policymakers Panicked as China Rare Earth Ban Extends to the West
BY JASON SIMPKINS, Managing Editor, Money Morning
China for months has blocked shipments of rare earth metals intended for Japan in retaliation for a regional dispute. Now, China appears to have expanded its rare earth embargo to include Western countries - a move that has U.S. and European authorities scrambling to formulate a backup plan.
Rare earth metals are essential to the production of high-tech devices like computers, display screens, smart bombs, and hybrid-car batteries. And despite their name, rare earth metals aren't particularly rare. However, they are difficult to produce and many rare earth production companies have moved their operations to China to capitalize on cheaper extraction costs and the nation's commitment to growing its alternative energy sector.
Entire police force in Los Ramones,
Mexico
quits after gunmen attack headquarters
BY PHILIP CAULFIELD - NYDailyNews.com
The entire police force in a small Mexican town abruptly resigned Tuesday after its new headquarters was viciously attacked by suspected drug cartel gunmen.
All 14 police officers in Los Ramones, a rural town in northern Mexico, fled the force in terror after gunmen fired more than 1,000 bullets and flung six grenades at their headquarters on Monday night.
No one was injured in the attack. Mayor Santos Salinas Garza told local media that the officers resigned because of the incident.
Volcano Erupts Again in Indonesia as Toll Rises
By AUBREY BELFORD - NYTimes.com
JAKARTA, Indonesia - Indonesian rescue workers struggled against rough weather and difficult terrain to reach tsunami victims on Thursday as the death toll continued to rise from the natural disasters that hit the archipelago nation this week on two separate fronts and just 24 hours apart.
In the remote Mentawai Islands west of Sumatra, aid workers said that the isolation of many villages as well as choppy seas meant that some victims had yet to receive any assistance three days after a 7.7-magnitude 7.7 underwater quake sent a 10-foot-tall tsunami crashing onto land, smashing apart homes and killing hundreds.
The High Price of Patriotism
By Robert Scheer - TruthDig.com
It's over for the U.S. in Afghanistan, but that doesn't mean the death and destruction are about to stop. Quagmires don't just go away. However, the signs are everywhere that the American course in that nation is doomed, that those directing this forlorn attempt at occupation of a country that has never tolerated occupation know there is no positive end in sight, and that the locals from President Hamid Karzai to the competing warlords and the Taliban are cutting their own deals on the assumption that our wishes no longer matter.
NEW! PTG News Content:
Turkmenistan Takes Sides in Pipeline Supply Competition
Global Intelligence Report
While Russia has stated that its state-owned gas giant Gazprom would participate in a trans-Afghan pipeline with Turkmenistan, Turkmen officials have denied the same. This comes after a rather disappointing meeting in Ashgabat between Russian President Dmitry Medvedev and his Turkmen counterpart Gurbanguly Berdymukhamedov, in which Moscow came away empty handed. Analytical Note: Turkmenistan has played coy with Russia, with the Turkmen president issuing a very general and vague statement during Medvedev's visit: "Russian and Turkmenistan have mutual interest in partnership development. Our relationship is noted for stability and mutual understanding on fundamental issues."
ASEAN Invites US, Russia into Club in Apparent Bulwark Against China Global Intelligence Report
The Association of Southeast Asian Nations (ASEAN) today said it would formally invite the US and Russia to join the bloc and take part in the club’s annual East Asian Summit as of next year. ASEAN is holding its fifth EAS on Saturday, immediately following the 17th ASEAN summit that closes today. US and Russian leaders are expected to attend this year’s EAS as special guests, ahead of their official invitation.
Turkmenistan denies Russia's "gas deals" statements
By Marat Gurt
ASHGABAT, Oct 28 (Reuters) - Turkmenistan denied on Thursday Russia's statements that its gas export monopoly Gazprom could take part in a trans-Afghan gas pipeline and that Moscow and Ashgabat had agreed to freeze a Caspian pipeline project.
Russia's top energy official, Deputy Prime Minister Igor Sechin, told reporters during President Dmitry Medvedev's visit to Turkmenistan last week that Gazprom could take part in the central Asian state's TAPI pipeline project.
Controlling the World's Monetary System ... The Bank for International Settlements
Joan Veon - SilverBearCafe.com
While most people understand what took place when the American Revolution was fought, many are not aware of the permanent financial revolution that is being fought over the world's monetary system since 1694 when the Bank of England was created. At that time, a group of private individuals decided that they could make a great deal of money if they changed the laws of the land to shift control of the country's finances from the government to them. The Bank of England, which is England's "central bank," is a private corporation which earns a continuous stream of income when the British government borrows from them to run the country. England was the ingenious country that recognized they could run the world's finances if they established private corporations in all the countries of the world. The combined debt of all the world's country's would create an income stream of unbelievable amounts.
Pimco likens US to 'Ponzi' scheme US authorities are operating a "brazen" Ponzi scheme in government debt by buying trillions of dollars of bonds to stimulate the economy, according to Bill Gross, managing director of Pimco, the world's biggest bond house.
By Philip Aldrick, Economics Editor - Telegraph.co.uk
In a bid to restart the stalling recovery, the US Federal Reserve is next week expected to unveil a second round of quantitative easing (QE) of as much as $500bn, on top of the $1.2 trillion already completed.
In typically robust comments, Mr Gross said the Fed had run out of other options but warned that more QE would in the long-term mean "picking the creditor's pocket via inflation and negative real interest rates".
PIMCO: Run Turkey, Run
DerailedCapitalism.com 30-year Bull Market in Bonds is Over
Despite front-running the Fed every step of the way, Bill Gross believes that the Fed's announcement will likely signify the end of a great 30-year bull market in bonds. He believes that the US is in a "liquidity trap, where interest rates or trillions in asset purchases may not stimulate borrowing or lending because consumer demand is just no there." It's good to see the managing director of the world's largest bond fund confirm the obvious. He also blatantly exposes the US Treasury, "Check writing in the trillions is not a bondholder's friend; it is in fact inflationary, and, if truth be told, somewhat of a Ponzi scheme. Public debt, actually, has always had a Ponzi-like characteristic." The question now becomes when, not if, will the US be unable to issue new debt? From Bill Gross of Pimco:
They say a country gets the politicians it deserves or perhaps it deserves the politicians it gets. Whatever the order, America is next in line, and as we go to the polls in a few short days it's incumbent upon a sleepy and befuddled electorate to at least ask ourselves, "What's going on here?" Democrat or Republican, Elephant or Donkey, nothing much ever seems to change. Each party has shown it can add hundreds of billions of dollars to the national debt with little to show for it or move our military from one country to the next chasing phantoms instead of focusing on more serious problems back home. This isn't a choice between chocolate and vanilla folks, it's all rocky road: a few marshmallows to get you excited before the election, but with a lot of nuts to ruin the aftermath.
Forget Stocks, What Happens When the Bond Bubble Bursts?
Phoenix Capital Research - SilverBearCafe.com
As I've stated in countless article before, the Fed is good at nothing but blowing bubbles. And while most commentators have focused predominately on the bubble occurring in stocks (if you compare where the S&P 500 is relative to economic data we are DEFINITELY in a bubble), a larger, more frightening bubble is currently brewing in bonds.
Since the 2008 Crash, investors worldwide have generally shunned equities in favor of the perceived safety of the bond market. Nowhere is this more apparent that in the retail investor market, where investors have pulled money from stock based mutual funds for 23 weeks in a row, while they're on pace to pile some $300 billion into bond funds this year (on the heels of a record $350 billion in bond fund inflows from last year).
All Signs Point to a Great Correction
by Bill Bonner - LewRockwell.com
What's new in civilization? We went to Cafayate last night. Our old friend Doug Casey hosted an intimate little dinner - for about 150 people. He's developing a community down there - the kind of place he wants to live inÉsurrounded by friends, good food, bright sun, beautiful views ... and everything else a man might want.
Whether this is a good idea or not, we can't say. But it is fun to get together with Doug and his crowd.
Since we were back in Internet range, we checked in with our usual sources. Here's what we found:
The economy is either growing slowly, or contracting.
Housing is probably going down. Remember, Mr. Market has to destroy the idea that "housing always goes up." When he's finished people will think that "housing never goes up."
* * * * * Important update! * * * * *
Lindsey Williams on Jeff Rense 26 Oct 2010
Podcast - slightly longer than YouTube video above.
Depression Within a Depression
by Jim Quinn - LewRockwell.com
In recent months, worshippers at the altar of Keynes have been hyperventilating over the possibility Congress will run a deficit of "only" $1.5 trillion in 2010. They have issued dire proclamations about a replay of the 1937-1938 Depression within the Great Depression. White House favorite and #1 Keynesian on the planet, Paul Krugman, declared that not borrowing an additional $100 billion to hand out to the unemployed for another 99 weeks would surely plunge the country into recession again:
"Suddenly, creating jobs is out, inflicting pain is in. Condemning deficits and refusing to help a still-struggling economy has become the new fashion everywhere, including the United States, where 52 senators voted against extending aid to the unemployed despite the highest rate of long-term joblessness since the 1930s. Many economists, myself included, regard this turn to austerity as a huge mistake. It raises memories of 1937, when F.D.R.'s premature attempt to balance the budget helped plunge a recovering economy back into severe recession." ~ Paul Krugman in NYT
So did Roosevelt's attempt to balance the budget in 1937 cause the second major downturn in 1938? I'm a trusting soul, but I prefer to verify what is being peddled to me by any economist, especially Paul Krugman.
Bank Failures in Slow Motion
Mises Daily: by Doug French
Every Friday evening a few more banks are closed - seized by the various state banking regulators and handed over to the Federal Deposit Insurance Corporation (FDIC) for liquidation. This all happens rather quietly, barely making the news. We're told these bank failures are no big deal. No reason to panic. The names of the banks change over the weekend and many customers don't notice the difference.
We've only had 294 failures this cycle, but it is a big deal: adjusted to current dollars, the Depression banking crisis was $100 billion, the S&L crisis was $923 billion, and the current crisis is nearly $8 trillion.
Employers in U.S. Start Bracing for Higher Tax Withholding
By Timothy R. Homan
Oct. 27 (Bloomberg) -- Employers in the U.S. are starting to warn their workers to prepare for slimmer paychecks if Congress fails to vote on an extension of Bush-era tax cuts.
"I've been doing payroll for probably close to 30 years now, and never have we seen something like this where it gets that down to the wire," said Dennis Danilewicz, who manages payroll services for about 14,000 employees at New York University's Langone Medical Center. "That's what's got a lot of people nervous. All we can do is start preparing communications with a couple of different scenarios."
Trigger Points, Black Swans, And Other Unpleasant Realities
By Giordano Bruno - Neithercorp Press
An avalanche is not an "event", it is an epic; a series of smaller events drifting and compacting one after another until the contained potential energy reaches an apex, a point at which it can no longer be managed or inhibited. A single tremor, an inopportune echo, an unexpected shift in the winds, and the entire icy edifice, the product of countless layered storms, is sent crashing down the valley like a great and terrible hand. In this way, avalanches in nature are quite similar to avalanches in economies; both events accumulate over the long span of seasons, and finally end in the bewildering flash of a single moment.
The problem that most people have today is being unable to tell the difference between a smaller storm in our economy, and an avalanche. Very few Americans have ever personally witnessed a financial collapse, and so, when confronted with an initiating event, like the stock market plunge of 2008, they have no point of reference with which to compare the experience. They misinterpret the crash as a finale. Untouched, they breathe a sigh of relief, unaware that this is merely the beginning of something much more complex and threatening.
Why the West is Losing
The dollar is fair game coming out of the G20 meeting of finance ministers. In morning London trading, the dollar is losing ground across the board, most decisively against the yen. ... The dollar's weakness ... stems from the declaration of "no currency wars" coming out of the G20 meeting. Loosely translated, that means countries won't intervene to tamp down their own currencies. At least not for a little while. - Wall Street Journal Dominant Social Theme: Trading continues. Life goes on. The dollar goes up and down.
Full Text of CFTC Commissioner Bart Chilton's Statement on Market Manipulation
JESSE'S CAFÉ AMÉRICAIN
Has the US financial media mentioned or even discussed this? Today the Bloomberg television news people are busy discussing the World Wrestling Federation, a caricature of sport analogous to the Comex and NYSE as financial markets.
Statement of Commissioner Bart Chilton
U.S. Commodity Futures Trading Commission
Public Hearing on Anti-Manipulation and Disruptive Trading Practices
Washington, D.C.
Tuesday, October 26, 2010
I take this opportunity to comment on the precious metals markets and in particular the silver markets.
More than two years ago the agency began an investigation into silver markets. I have been urging the agency to say something on the matter for months. The public deserves some answers to their concerns that silver markets are being, and have been, manipulated.
SILVER FRAUD: Telling the Truth is a Revolutionary Act.
Hats off to Bart Chilton
Silver subject to 'repeated attempts' to manipulate prices
by Rob Mackinlay - CityWire.co.uk
Silver markets have been subject to 'repeated attempts to influence prices', according to Bart Chilton, commissioner at the Commodity Futures Trading Commission (CFTC).
In a statement released on Tuesday he said: 'There have been fraudulent efforts to persuade and deviously control that price. Any such violation of the law in this regard should be prosecuted.'
Chilton (pictured) suggested that it would be too difficult to prove actual manipulation: 'Under existing law, to prove manipulation, the government is required to demonstrate not only specific intent; we also need to prove that as a result of the intent and market control, that activity caused an artificial price -- a point that can certainly be debated by economists.'
Comex Gold lower as US Dollar Index sees more short covering
By Jim Wyckoff of Kitco News
Comex gold prices are trading moderately lower Wednesday morning, as the U.S. dollar index sees more short-covering buying following recent selling pressure. December Comex gold last traded down $8.10 at $1,330.50 an ounce. Spot gold was last quoted down $10.00 at $1,330.75.
The U.S. dollar index is trading modestly higher Wednesday on another short-covering bounce from recent selling pressure. There is a story in the Wall Street Journal Wednesday that suggests the Fed may not employ a large quantitative easing effort in November, but instead use a more "measured" approach. This has led some market watchers to believe markets may have over-reacted the past few weeks to what was believed by many to be a big quantitative easing effort to be announced in November. Many market veterans do believe the "QE" is already mostly factored into many markets' price structures.
Marc Faber on Gold
Fed move to hit gold, silver
LONDON (Commodity Online): US Federal Reserve's decision to further ease monetary situation has hit the gold and silver market across the globe.
Following US futures regulator raised an alarm about the silver market, the markets witnessed a flurry of activities and ultimately lost some glitter.
Delta-hedging - where option granters buy to cover their exposure - against the $24 strike, helped push spot silver to jump nearly 40 cents to $24.20 earlier in the day. Silver later retreated to $23.88.
SILVER REPORT: FRAUD, CORRUPTION & QE TO INFINITY ....
it's all that remains for the Fed to do.
Gold decoupling from stock market
By Nu Yu, Ph.D. and Lorimer Wilson
Gold and silver have had a sharp move downward in response to China's first interest rate hike last week while the stock market continues to move forward begging the question: "Is gold decoupling from the stock market?"
By using a correlation indicator calibrated for the intermediate-term, the chart below shows the change in coupling between gold and the S&P 500 index during the past six years. The value of the correlation indicator lies between 1 and -1 whereby:
a) If the correlation value is 1 it indicates a perfect positive coupling between gold and the S&P 500 index which means gold and the stock market move in the same direction regardless of whether they go up or down.
b) If the correlation value is -1, it indicates a perfect negative coupling with gold and the stock market moving in opposite directions.
c) If the correlation value is 0, there is no coupling at all between them.
"Resistance is Futile"
Dan Norcini - SilverBearCafe.com
News emerging out of the weekend's G20 meeting resulted in additional Dollar selling and wholesale buying of the Japanese Yen further evidencing the fact that the Bank of Japan is finished as a market moving force in the foreign exchange markets as it has given up on attempting to derail the Yen. The unvarnished truth is that the BOJ has met its match in the Bernanke-led Fed which can "Out QE" it with one hand tied behind its back. "Resistance is Futile" said the Borg to humanity but it might as well be said by the Borg leader Bernanke to the rest of the Central Banks of the world.
Strength in the Yen and the Aussie is working to keep pressure on the US Dollar, even as the Euro surrendered a rather large portion of its overnight gains as the New York session wore on. It fell below the critical level of 77 but managed to recover and get back over it thanks to the slide in the Euro.
The result was that gold, which had been sharply higher last evening barely missing $1,350 faded off of those levels following the Euro although it did managed to put on some decent gains moving further away from the now established support zone near $1,320.
Could The Government Really Be That Stupid?
By Daniel - DerailedCapitalism.com
On October 12, 2010 Edwin (Ted) Truman wrote an article for the Financial Times of London in which he suggested that the US Treasury should sell all of its gold reserves.
Ted Truman is not just anybody. He is a former Federal Reserve economist and is well connected. This means that we should not write off his comments as idle chatter. Although it seems highly unlikely that such a wholesale liquidation of the US gold reserves could ever be approved it is interesting to study the implications if it were to happen. I will show you why it would be the most stupid thing the government could ever do.
'Uncontrolled' Dollar Is Risk for China, Official Says
By Bloomberg News
Oct. 27 (Bloomberg) -- The U.S. Federal Reserve's "uncontrolled" issuance of dollars is adding to inflation risks in China and creating difficulties for the nation's businesses, Chinese Commerce Minister Chen Deming said.
U.S. policies "and continued increases in commodity prices are bringing China the shock of imported inflation," the state- run Xinhua News Agency cited Chen as saying at a trade fair in Guangzhou yesterday. He referred to "uncertainties" and "difficulties" for Chinese firms.
'Every Man for Himself' as Emerging Markets Curb Currency Gains
By Simon Kennedy
Oct. 27 (Bloomberg) -- Finance chiefs from South Korea to South Africa signaled they may act to slow gains in their currencies, just four days after the Group of 20 vowed to soothe trade tensions in the $4 trillion-a-day foreign-exchange market.
Asian currencies fell to a one-week low after Bank of Korea Governor Kim Choong Soo said today that measures to mitigate capital flows could be "useful." Hours later, the rand dropped as South African Finance Minister Pravin Gordhan said his government will use part of higher-than-expected tax revenue to build foreign reserves as it attempts to weaken the currency.
$100 Oil Is Coming
Michael T. Snyder - SilverBearCafe.com
The price of oil has been hovering around 80 dollars a barrel for quite some time now, but get ready, because it is going to move significantly higher. Oil prices have already risen about 9 percent over the past month, and many believe that this could very well be the start of a new trend.
Lawrence Eagles, a top analyst at JP Morgan, recently made headlines across the globe when he stated that oil could hit 100 dollars a barrel "much sooner than we expect". Not only that, but a number of top OPEC officials are also publicly discussing the possibility of 100 dollar oil. But just because a few people are talking about it does not mean that it is going to happen. So are there any other reasons why we should anticipate a significant increase in the price of oil?
Treasury's embrace of [redacted] transparency
Washington Examiner Editorial
At the outset of his presidency, President Obama signed a memorandum to all federal departments and agencies declaring his support for the Freedom of Information Act. He directed that "all agencies should adopt a presumption in favor of disclosure, in order to usher in a new era of Open Government. The presumption of disclosure should be applied to all decisions involving FOIA."
It appears, however, that his Treasury Department appointees didn't get the memo because for months Treasury has resorted to unexplained delays and other questionable tactics to avoid making public thousands of documents related to the $700 billion Troubled Asset Relief Program. The documents were requested by Bloomberg News and Judicial Watch, among other news and public interest groups.
Marc Faber on Bloomberg 10/26/10:
QE2 to Drive Down Stocks
Stiglitz: TARP Returns a "Drop in the Bucket"
Compared to Damage Done
by Aaron Task - Tech ticker
The past few weeks has brought a lot of chatter about the success of the bailouts. First came Dan Gross' exclusive on the overall costs of TARP. Then Bloomberg reported on the government's $25 billion profit on its 2008 "investment" in banks and insurance companies. Meanwhile, the Treasury has consistently lowered its estimate of the cost of the AIG bailout.
But TARP watchdog Neil Barofsky takes umbrage with the Treasury's AIG latest estimate and those "success" stories conveniently exclude the bailouts of Fannie Mae and Freddie Mac, which the Federal Housing Finance Agency estimates could be as much as $215 billion above the $148 billion of government assistance already provided.
Moreover, such talk misses the big picture, says Columbia Professor and Nobel Prize-winning economist Joseph Stiglitz.
Fed Won't Join Bank High Court Appeal on Crisis Loans
By Bob Ivry and Greg Stohr
Oct. 26 (Bloomberg) -- The Federal Reserve won't join a group of the largest commercial banks in asking the U.S. Supreme Court to let the government withhold details of emergency loans made to financial firms in 2008.
The central bank's decision not to appeal makes it less likely the high court will hear the case, said Tom Goldstein, a Washington lawyer who has argued 22 cases before the high court since 1999 and whose Scotusblog Website tracks the panel.
US Fed to avoid 'shock and awe' stimulus, WSJ reports The US Federal Reserve is likely next week to unveil a programme of US Treasury bond purchases worth a few hundred billion dollars over several months, the Wall Street Journal reported on Wednesday. - Reuters via Telegraph.co.uk
What the Journal report called a "measured approach" compares with investors' base-case scenario of an initial commitment to buy at least $500 billion in Treasury debt over five months, in an effort to spur lending and to support an economic recovery that is too weak to tame high unemployment.
The Journal gave no source for the report on its website and said that, although details remain to be sorted out internally, the broad outlines have taken shape.
Political upheaval rocks eurozone debt markets The simmering crisis on the eurozone fringes has erupted again as the full impact of debt deflation hits home, testing political solaridity and raising fresh doubts about the workability of Europe's austerity policies.
By Ambrose Evans-Pritchard - Telegraph.co.uk
Hopes of a budget deal in Portugal collapsed after marathon talks between the minority government of socialist premier Jose Socrates and conservative leaders ended in acrimony.
Finance minister Fernando Texeira dos Santos said failure to agree on budget cuts will "plunge the country into a very deep financial crisis".
Meanwhile, Ireland has announced fiscal retrenchement of Û15bn over the next four years, twice the original plan. It is already cutting public wages by 13pc.
John Fitzgerald from Ireland's Economic and Social Research Institute said there is a risk that austerity tips the economy into a downward spiral, comparing it to an overdose of "chemotherapy" that does more harm than good.
Charged with "a salt & fattery"! Baltimore Food Police Write First Ticket
By Doug Powers
Conversation coming soon to a prison cell near you:
"What are you in for?"
"Grand theft auto. You?"
"Butter."
BALTIMORE - The Baltimore City Health Department issued its first environmental citation for repeat violations of the city's trans fat ban.
The Health Department issued Healthy Choice, a food facility in the 400 block of Lexington Street, a $100 fine on Thursday.
"It was the second time they were found with a high trans fat level in their ingredients," said Health Department agent Juan Gutierrez.
Officials said that during inspections in July and this month, the facility was found to be using a margarine product with trans fat levels in excess of what the law allows.
Health Care Vote Puts Democrats on Defensive
By KEVIN SACK - NYTimes.com
CHARLOTTESVILLE, Va. - At the start of their debate here last week, the Republican challenger for Congress, State Senator Robert Hurt, paused only long enough to thank the League of Women Voters before ripping into Representative Tom Perriello for voting for "government-run health care." Mr. Hurt returned to the topic seven times over the next hour, despite being asked only once.
If Mr. Hurt was reading from his party's playbook, so was Mr. Perriello, a freshman Democrat scrapping to survive in the centrist Fifth Congressional District, which spans central and southern Virginia. He emphasized that the health law had preserved the private insurance system, and that he had already been thanked by constituents who can "go to bed at night not having to worry" that they will be bankrupted by disease. Then he asked for a chance to improve an imperfect law.
Case-Shiller Housing Chart
S&P Case-Shiller housing data was released yesterday (report).
Bottom line up front: The report noted a deceleration in home price growth rates in most of the areas surveyed. Take a look at the circled area in the chart below - notice anything? Hmm, could this be the beginning of another leg down for the housing market?
Report Excerpts:
"A disappointing report. Home prices broadly declined in August. Seventeen of the 20 cities and both Composites saw a weakening in year-over-year figures, as compared to July, indicating that the housing market continues to bounce along the recent lows," says David M. Blitzer, Chairman of the Index Committee at Standard & Poor's. "Over the last four months both the 10- and 20-City Composites show slowing growth, after sustaining consistent gains since their April 2009 troughs.
Lower-End Homes Pull Prices Down in August
by Dean Baker - MonthlyReview.org
The August Case-Shiller 20-City Index showed that house prices have resumed their decline, dropping by 0.2 percent for the month. Prices fell in 15 of the 20 cities in the index for the month.
The drop was led by a decline in the prices of homes in the bottom tier of the Case-Shiller index. Prices for homes in the bottom third of the housing market fell for all of the cities for which the index is calculated. In several cities, the price decline in August at the bottom tier was quite sharp. In Washington, which has a relatively strong market overall, prices in the bottom tier fell by 2.2 percent in August. They fell by 3.1 percent in Tampa.
Metro area home prices fall as affordability index hits all-time high
By Brad Allen - MinnPost.com
It was good news/bad news Tuesday in the housing market.
First, the bad news: The monthly Case-Shiller index, a leading measure of U.S. home prices, declined from July to August across a composite of 20 major metropolitan areas, including the Twin Cities area, which dropped 0.3 percent.
The good news: A separate report from the Minnesota Realtors Association found that homes are more affordable than anytime since 1971.
Robert Shiller: End of Tax Credit Could Mean
Big Trouble for Housing ... and Bank
by Stacy Curtin - Tech Ticker
It is all about housing this week. And, so far the news is mixed. The good news came on Monday with a better-than-expected 10% jump in September's existing-home sales. The not so good news out yesterday. Home prices fell 0.2% in August according the S&P Case-Shiller Index.
Yale Professor Robert Shiller, co-creator of the S&P Case Shiller Index is very curious to see where home prices go after the Homebuyers' Tax Credit expires (It expired Sept. 30, but effects on the market won't be seen for a few months). "The homebuyer tax credit did create an end - at least for the time being - of the decline in home prices," Shiller tells Aaron at The Economist's Buttonwood Gathering. "But it didn't create a very strong recovery."
How Did the Banks Get Away With Pledging Mortgages to Multiple Buyers? - George Washington's Blog
I've repeatedly documented that mortgages were pledged multiple times to different buyers. See this, this and this.
In response, some people (including one of the country's top bankruptcy lawyers) have told me they don't buy it.
Specifically, they ask such questions as:
With a mortgage sold to two different entities, wouldn't the income from the mortgage be shown on the books of both entities?
Was the interest/principal payments that were made by the homeowner before they stopped being divided between both entities? If so, wouldn't this have rung alarm bells immediately?
If only one was getting it, why didn't the other entity immediately try to foreclose?
If there was one servicer involved, was the servicer covering the difference between what was collected and the payments actually made? If so, how did the servicer do this and still remain in business?
If two servicers were involved, why didn't this come out sooner or were both servicers hiding this fraud?
Wells Fargo to refile paperwork in 55,000 foreclosure cases The mortgage lender will refile foreclosure paperwork because of mistakes in some of the documents but won't suspend efforts to seize borrowers' homes.
By E. Scott Reckard, Los Angeles Times
Wells Fargo & Co. said Wednesday it would refile paperwork in 55,000 foreclosure cases because of mistakes in some of the documents but said it wouldn't suspend efforts to seize borrowers' homes as some other mortgage firms have done.
Mike Heid, co-president of the San Francisco bank's home lending unit, said Wells had identified potential problems with the final sign-offs by bank employees and notaries on legal affidavits. That is the same problem reported by three major rivals in the mortgage customer-service business.
State Tea-Party Groups Splinter as Vote Nears
By STEPHANIE SIMON - WSJ.com
EVERGREEN, Colo. - Lori Christenson has ignored her friends, her garden and her golden retriever to throw herself into advancing the tea-party movement in Colorado.
Election Day should be a chance for her to put the exclamation point on all that work: Tea-party favorites stand as the state's Republican nominees for Senate and governor. The ballot also includes three rein-in-government measures that reflect the movement's core values.
Yet instead of uniting in a final push toward election day, the movement in Colorado has begun to splinter, with rival camps accusing one another of betrayal, naivet ... and failure of courage.
Judge Napolitano - Judge In Michigan - Obamacare Is Constitutional
MGM Drama Nears Climax
By MIKE SPECTOR And LAUREN A.E. SCHUKER - WSJ.com
LOS ANGELES - Metro-Goldwyn-Mayer Inc.'s latest drama is near a denouement.
The lead character is the studio itself, which after a storied past as a Hollywood icon is looking at a frugal future as a hedge-fund asset.
On Friday, creditors vote on a plan to send MGM into bankruptcy court, to be relieved of a crushing debt load, not to mention a management that offered spending solutions at sharp odds with desires of the lenders.
But there is a last-minute plot twist: Stalking the studio with a rival plan of his own is activist investor Carl Icahn. This week, he sweetened an offer to buy debt from other MGM creditors, in an effort to upend the plan before them and raise the chances of ultimately controlling the studio's fate himself.
Google Plays Up Local Advertising
By AMIR EFRATI - WSJ.com - $$
In a bid to get more advertising dollars from businesses located near people using its search engine, Google Inc. is revamping how it displays information about local enterprises.
Google's Place Search, which is expected to roll out globally by Thursday, gives Google users more information about local businesses, such as restaurants and dry cleaners, directly on the first results page, including a photo, review ratings and a snippet of a review from sites such as CitySearch.com or Yelp.com, as well as links to those review sites.
Laurel Tate, co-owner of Two Sole Sisters LLC, a small shoe and accessories shop in Boulder, Colo., says the new format could help small businesses like hers.
"When it populates and gives more information, especially for people who don't know me, it gives my store legitimacy," she says.
Nazi Victims Ask EU to Probe Vatican on Looted Assets
By Jeffrey Donovan and Lorenzo Totaro
Oct. 26 (Bloomberg) -- Holocaust survivors from the former Yugoslavia accused the Vatican of helping Nazi allies launder their stolen valuables and have asked the European Commission to investigate their claims.
"We are requesting the commission open an inquiry into allegations of money laundering of Holocaust victim assets by financial organs associated with or which are agencies of the Vatican City State," Jonathan Levy, a Washington-based attorney for the survivors and their heirs, wrote in a letter dated Oct. 20 to Olli Rehn, the European Union's economic and monetary affairs commissioner. Levy provided the letter to Bloomberg.
Iran Takes Over OPEC
By Robert Morley - theTrumpet.com
Iran is back in charge, and that signals big changes in the Middle East-and in your pocketbook.
Iran is soon to be the president of opec again. And the implications could be enormous. An international oil dispute is virtually sure to erupt, says one Russian analyst. It is only a matter of how soon. But this time, he says, it is not America's fight - it is Europe's.
On October 14, Iran was elected president of the Organization of the Petroleum Exporting Countries - and that says a lot about how the world is changing.
America's global clout and influence is clearly on the wane. And not just because opec - a grouping of nations that includes many anti-American states - elected perhaps the biggest anti-American state to its presidency. But because, as rtt News said, it did so "unanimously"!
Engineering a Global Depression to Create a Global Government "Crisis is an Opportunity"
By: Andrew G Marshall - MarketOracle.co.uk
Problem, Reaction, Solution: "Crisis is an Opportunity"
In May of 2010, Dominique Strauss-Kahn, Managing Director of the IMF, stated that, "crisis is an opportunity," and called for "a new global currency issued by a global central bank, with robust governance and institutional features," and that the "global central bank could also serve as a lender of last resort." However, he stated, "I fear we are still very far from that level of global collaboration."[1] Well, perhaps not so far as it might seem.
The Unseen Carbon Agenda The EPA wants to take away 7% of U.S. power generation.
WSJ.com - $$
Anyone who cares about the U.S. economy is breathing easier now that cap and tax appears to be on the political garbage barge, but don't be so sure. The White House is still pursuing its carbon agenda through regulation, albeit with almost no public attention, and a new study shows the damage that is already being done.
Yesterday the North American Electric Reliability Corporation, a highly regarded federal energy advisory body, released an exhaustive "special assessment" of this covert program. NERC estimates that the Environmental Protection Agency's pending electric utility regulations will subtract between 46 and 76 gigawatts of generating capacity from the U.S. grid by 2015. To put those numbers in perspective, the worst-case scenario would amount to a reduction of about 7.2% of national power generation, and almost all of it will hit coal-fired plants, the workhorse that supplies a little over half of U.S. electricity.
The Wall Street Buttonwood Gathering - View from the Top
By: PhilStockWorld - - MarketOracle.co.uk This was an interesting event!
On May 17th 1792, twenty-four stock brokers met under a buttonwood tree outside 68 Wall Street and agreed to set up the New York Stock and Exchange board. The tree was a symbol of Wall Street, but also, it was where people originally met to trade, to discuss and to argue.
The Economist has done an excellent job of keeping the tradition alive by bringing together top global financial executives, policymakers, global regulators and opinion leaders to discuss and debate proposed guidelines for the financial community, seeking to bridge fundamental financial issues with macroeconomic and geopolitical viewpoints.
America on Sale, From Matt Taibbi's 'Griftopia' Our cash-strapped country is auctioning off its highways, ports and even parking meters, finding eager buyers in the Middle East
By Matt Taibbi - RollingStone Politics
In the summer of 2009 I got a call from an acquaintance who worked in the Middle East. He was a young American who worked for something called a sovereign wealth fund, a giant state-owned pile of money that swims around the world in search of things to buy.
Sovereign wealth funds, or SWFs, are huge in the Middle East. Most of the bigger oil-producing states have massive SWFs that act as cash repositories (with holdings often kept in dollars) for the revenues generated by, for instance, state-owned oil companies. Unlike the central banks of most Western countries, whose main function is to accumulate reserves in an attempt to stabilize the domestic currency, most SWFs have a mission to invest aggressively and generate huge long-term returns. Imagine the biggest and most aggressive hedge fund on Wall Street, then imagine that that same fund is fifty or sixty times bigger and outside the reach of the SEC or any other major regulatory authority, and you've got a pretty good idea of what an SWF is.
Project Weimar: Why QE2 Could be More Inflationary Than You Think
by EB - ZeroHedge.com "In my darkest moments, I have begun to wonder if the monetary accommodation we have already engineered might even be working in the wrong places." -Dallas Federal Reserve Bank President, Richard W. Fisher, October 19, 2010
This is the condensed version of what I wrote the other day. Just about everyone now expects the Fed to purchase half to a cool trillion or more in Treasury purchases over the next year. As Tyler pointed out a few weeks ago, "The problem, as we also concluded, is that there are simply not enough Treasurys across the entire curve, in existing or projected issuance, to satisfy the Fed's possible total monetization needs!" Indeed. But, the possibility remains that the money simply ends up as excess reserves at the Fed like last time, right? Why worry about inflation as the 10 year grinds ever lower and lending continues to fall?
Should the Fed Be Concerned about Low Price Inflation?
By: Frank Shostak - MarketOracle.co.uk
In its September 21 meeting, the Federal Reserve Open Market Committee expressed concern that the rate of inflation is far too low. According to the minutes some members of the FOMC have said, that unless the pace of economic recovery strengthened or underlying inflation moved back toward a level consistent with the Committee's mandate, they would consider it appropriate to take action soon. With respect to the statement to be released following the meeting, members agreed that it was appropriate to adjust the statement to make it clear that underlying inflation had been running below levels that the Committee judged to be consistent with its mandate for maximum employment and price stability, in part to help anchor inflation expectations. ... The Committee was prepared to provide additional accommodation if needed to support the economic recovery and to return inflation, over time, to levels consistent with its mandate.
Inflation in the Real World
By: Casey Research - MarketOracle.co.uk
Jake Weber, Editor, The Casey Report writes: As is often the case, there is a big difference between what the government statistics are reporting and what's going on in the real world. According to the most recent inflation reading published by the Bureau of Labor Statistics (BLS), consumer prices grew at an annual rate of just 1.1% in August.
The government has an incentive to distort CPI numbers, for reasons such as keeping the cost-of-living adjustment for Social Security payments low. While there's no question that you may be able to get a good deal on a new car or a flat-screen TV today, how often are you really buying these things? When you look at the real costs of everyday life, prices have risen sharply over the last year. For simplicity's sake, consider the cash market prices on some basic commodities.
Treasury hiring FOIA officers 'to withhold information from release to public' By: J.P. Freire - Washington Examiner.com
Officials at the Treasury Department's Office of Financial Stability contracted with a small consulting firm that has given nearly $25,000 to Democratic candidates since 2005 (and no money to Republicans) to hire "Freedom of Information Act (FOIA) Analysts to support the Disclosure Services, Privacy and Treasury Records." The firm is currently advertising a job opening for a FOIA analyst with experience in the "Use of FOIA/PA exemptions to withhold information from release to the public".
This means that the entire OFS, which is tasked with overseeing the Troubled Asset Relief Program, is trying to hire people who will withhold information from release to the public.
Treasury Hid A.I.G. Loss, Report Says
By MARY WILLIAMS WALSH - NYTimes.com
The United States Treasury concealed $40 billion in likely taxpayer losses on the bailout of the American International Group earlier this month, when it abandoned its usual method for valuing investments, according to a report by the special inspector general for the Troubled Asset Relief Program.
"In our view, this is a significant failure in their transparency," said Neil M. Barofsky, the inspector general, in an interview on Monday.
In early October, the Treasury issued a report predicting that the taxpayers would ultimately lose just $5 billion on their investment in A.I.G., a remarkable outcome, since the insurance company was extended $182 billion in taxpayer money in the early months of its rescue. The prediction of a modest loss, widely reported as A.I.G., the Federal Reserve and the Treasury rushed to complete an exit plan, contrasted with an earlier prediction by the Treasury that the taxpayers would lose $45 billion.
U.S. Seeks to Shield Goldman Secrets
By SCOTT PATTERSON - WSJ.com
Goldman Sachs Group Inc. has always closely guarded the secrets of its lucrative high-speed trading system. Now the securities firm is getting a help from an unusual source: federal prosecutors.
Federal prosecutors in Manhattan this week asked a federal district judge to seal the courtroom at the forthcoming trial of a former Goldman computer programmer accused of stealing the firm's computer code. The trial is set to start to late November.
Prosecutors also asked that any documents related to Goldman's trading strategies remain under seal.
Gold to be at $2,000 to $2,500, Silver at $30 or $35
TGR - CommodityOnline.com
In this exclusive interview with The Gold Report, investor, mathematician and former fund manager Michael Berry, PhD, tells us he is bullish on gold, which he expects will double or more in price in the not-too-distant future. In the meantime, with organizational skills developed in a previous career as professor of investments, Berry has created a 10-point "Discovery Investing" (DI) model by which all stocks in his universe are graded. For his own portfolio and as well as his Morning Notes newsletter, he has staked out plays on several small- and micro-cap mining stocks that he expects will perform quite well through either price appreciation on discoveries or takeover.
Next is Fed-fuelled rally for Gold?
By Jeffrey Nichols - CommodityOnline.com
From its mid-October all-time high pennies over
$1,387 an ounce to its recent low just under $1,315 an ounce last Friday, gold suffered a loss of just about 10 percent.
However, looking closely at the price action and short-term supply/demand flows of recent weeks reveals the metal's inherent strength and, in fact, raises our confidence that gold prices are headed much higher over the next few years.
Following a pattern that has become fairly routine and that characterized previous corrections in the past couple of years, much of the selling in recent weeks was concentrated in derivative markets as institutional traders and speculators took profits following the steep price advance.
Gold and Silver Reverse Dollar Bounce on Profit-Taking
By: Adrian Ash - MarketOracle.co.uk
THE PRICE OF GOLD unwound yesterday's 1.5% gain vs. the Dollar in Asian and London trading on Tuesday, slipping as the US currency recovered from sharp losses against crude oil, world equities and the Euro.
"Gold was well offered" at the start of London trading today, says one dealer.
Silver prices slipped faster, reversing all of Monday's 2.2% rally.
"The selling is profit-taking," reckons Bernard Sin of Swiss refinery MKS's Finance division, speaking to Bloomberg.
"Gold has come so far. In the medium term, the Dollar correlation will continue."
Averaging a daily correlation to the Euro/Dollar exchange rate of virtually zero over the first 9 months of the year, the Dollar price of spot gold now shows a near-perfect correlation of +0.95 with the Euro for Oct. so far.
Wall Street Journal joins brokers in trying to talk investors out of gold
Submitted by cpowell - Gata.org Advisers Try to Tame Investors' Appetite for Gold
By Ian Salisbury - WSJ.com
As individual investors hop on the gold bandwagon, financial advisers are finding themselves in an all-too-familiar role: that of mom and dad slapping hands away from the cookie jar.
The precious metal has enjoyed a long run-up, gaining about 25% in the past year and consistently making headlines with records pushing ever higher. Also fueling the buying binge is a number of big-name investors like Paulson & Co.'s John Paulson. Gold prices stood at $1,324.40 a troy ounce Friday.
Such price spikes and high-profile bullishness often create a ticklish situation for advisers: They think about selling just as clients want to buy.
"I am not a gold bug, but I have a couple of clients that have just insisted," said Jim Heitman, a financial planner in Alta Loma, Calif. "Even as they objectively recognize the threat of a bubble, they just don't seem to care."
Gold in a Low-Inflation Environment, Part II
By: Adrian Ash - MarketOracle.co.uk "There is too little money in the economy." - Bank of England governor Mervyn King, 19 October 2010 SO the FEDERAL RESERVE is dead-set on creating inflation, and it's plain to see why.
Household debt in the US now stands so large, paying it down to 2001 levels - as a proportion of income - would require a drop in consumer spending of $2.7 trillion, some 18% of this year's gross domestic product. Deleveraging to 1990 levels of gearing (again, a then-record at the time) would cost US households $3.5 trillion, well over a quarter of their 2010 incomes.
It ain't gonna happen, in other words. Not this side of Paul Krugman joining John Maynard Keynes in that eternal "long run" in the sky. So what's needed, or so the theory runs, is inflation in prices. It would make deleveraging very much easier, as happened during the last retrenchment, back in the early 1980s. Consumers got to pay down debt without...well, without paying it down! And that gave households enough confidence (and rope) to start expanding their debts again.
Silver money for Americans
Hugo Salinas Price - Plata.com.mx
I think that my readers will agree that there is a desperate need for some fresh thinking about money in the U.S.
Many respected analysts worry that the expected action by the Fed to apply a new bout of QE after the coming elections is fraught with danger.
Fiat money in the US is in an advanced stage of decomposition and when money rots, the whole social, economic and political structure of the nation rots with it. A return to sound money is urgent. More and more people are aware of the perilous road ahead if nothing is done.
CFTC Commissioner Raises Alarm Over Silver Market Manipulation
JESSE'S CAFÉ AMÉRICAIN
The manipulation in the silver market with two or three banks holding enormous undeliverable short positions was obvious, for years.
The CFTC was complicit in turning a blind eye to this, stonewalling and whitewashing the corruption, as were many market commentators and participants. Ted Butler and GATA did a wonderful job of highlighting this enormous fraud but were ignored and even vilified for the past twelve years in the same vein as whistle blower Harry Markopolos was in raising concerns about Madoff's investment scheme.
BN * SILVER PRICES SUBJECT TO "FRAUDULENT" INFLUENCES, CHILTON SAY
BN *"REPEATED ATTEMPTS" MADE TO INFLUENCE SILVER MARKET, CHILTON
BN *SILVER MANIPULATION SHOULD BE PROSECUTED, CHILTON SAYS
Now... where are all of those tin foil hats...
The below has just appeared on Reuters. It seems the CFTC has its cross sights on quote stuffers. It is about damn time.
The U.S. futures regulator laid out plans on Tuesday for how it could use new and beefed-up legal tools to foil traders who seek to manipulate prices or defraud investors.
The Commodity Futures Trading Commission said it also wants to ask for comments on whether to crack down on certain practices used by high-frequency traders -- such as "quote-stuffing" -- but it stopped short of immediately proposing new rules specifically aimed at algorithmic trading.
Fed Gears Up for Stimulus Eyes Gradual Bond Buying of Several Hundred Billion Dollars; Doubts Linger By JON HILSENRATH And JONATHAN CHENG - WSJ.com
The Federal Reserve is close to embarking on another round of monetary stimulus next week, against the backdrop of a weak economy and low inflation - and despite doubts about the wisdom and efficacy of the policy among economists and some of the Fed's own decision makers.
The central bank is likely to unveil a program of U.S. Treasury bond purchases worth a few hundred billion dollars over several months, a measured approach in contrast to purchases of nearly $2 trillion it unveiled during the financial crisis. The announcement is expected to be made at the conclusion of a two-day meeting of its policy-making committee next Wednesday.
Bernanke's $4 Trillion Quantitative Easing Dilemma
By: Mike Whitney - MarketOracle.co.uk
Ben Bernanke is in a real fix. His quantitative easing (QE) program is designed to boost stock prices, lower bond yields, and weaken the dollar.
But the market has already priced all that in, so when he announces the start of the program on November 3, there's a good chance that things will either stay the same or head in the opposite direction. That's bad for Bernanke. Just imagine if the dollar strengthens just as the Fed chairman begins buying-up Treasuries to push the dollar down. He'll look pretty foolish. But that could happen because the dollar has already slipped nearly 7% since August and is overdue for a rebound.
Bernanke Leaps into a Liquidity Trap
By John P. Hussman, Ph.D.
"There is the possibility... that after the rate of interest has fallen to a certain level, liquidity preference is virtually absolute in the sense that almost everyone prefers cash to holding a debt at so low a rate of interest. In this event, the monetary authority would have lost effective control." - John Maynard Keynes, The General Theory
One of the many controversies regarding Keynesian economic theory centers around the idea of a "liquidity trap." Apart from suggesting the potential risk, Keynes himself did not focus much of his analysis on the idea, so much of what passes for debate is based on the ideas of economists other than Keynes, particularly Keynes' contemporary John Hicks. In the Hicksian interpretation of the liquidity trap, monetary policy transmits its effect on the real economy by way of interest rates. In that view, the loss of monetary control occurs because at some point, a further reduction of interest rates fails to stimulate additional demand for capital investment.
Geithner's Global Central Planning
The Chinese government's accumulation of U.S. debt represents a tragic investment decision, not a currency-manipulation effort.
By JOHN H. COCHRANE - WSJ.com - $$
Economists are full of bad ideas. Terrible ideas seem to emerge when the gurus get together to talk about coordinating their bad ideas. Last week's public letter from Treasury Secretary Tim Geithner to the G-20 finance ministers is a great example.
Mr. Geithner starts with a dramatic proposal: "G-20 countries should commit to undertake policies consistent with reducing external imbalances below a specified share of GDP [later reported to be 4%] over the next few years."
Since when is every trade surplus or deficit an "external imbalance" in need of correction? It makes sense for a country that has good investment prospects to import a lot of goods, run trade deficits, and borrow money. Years later, the country puts the resulting products on boats to pay the lenders back. The U.S. borrowed abroad to finance our railroads in the 19th century and ran surpluses when Europe was rebuilding after World War II. Were these "imbalances"?
Greece reignites Europe debt woes
Europe's debt woes have returned to the fore after Greek premier George Papandreou threw open the door to fresh elections and vowed to liberate the nation from "slavery and surveillance".
By Ambrose Evans-Pritchard - Telegraph.co.uk
Spreads on 10-year Greek bonds jumped 31 basis points to 9.57pc and the euro tumbled 2 cents to $1.385 against the dollar as investors awoke to the risk of political upheaval in Greece, not helped by warnings from bond giant PIMCO that Athens will default within three years.
"We have not yet escaped the danger. I am sounding the alarm," said Mr Papandreou.
While he promised to stick to the EU-IMF austerity plan, he threatened to go to the country if upcoming local elections fail to give his socialist PASOK party a clear mandate. "There can no deadlock in democracy, the people have the power to decide," he said.
China and the Anti-Realists
BY STEVE SAVILLE - GreenFaucet.com
There is much gnashing of teeth by the realists and celebrating by the Keynesians over the possibility that the Fed will soon embark on another round of "quantitative easing". The anticipation of faster inflation of the US$ supply has put downward pressure on interest rates and caused the speculative juices to flow more freely in the commodity and equity markets. The Keynesians, who believe that economic depressions are caused by a mysterious decline in "animal spirits" and that everything would be just fine if we would simply return to borrowing, spending and partying as if it were 2006, are therefore getting their wish. The realists, however, understand that thanks to the excessive borrowing and misdirected spending of the boom years there are now huge imbalances in the economy that must be corrected before a genuine recovery can begin, and that artificially-stimulated borrowing and spending will only add to the imbalances by wasting more valuable resources; in other words, they understand that the problems are real and cannot be made to disappear by conjuring more money out of nothing or by using some other trick to foster more of a "devil may care" attitude within the collective mind of the public.
The Fed Wants to Unleash a BIG QE 2 Program ... But CAN It?
Submitted by Phoenix Capital Research - ZeroHedge.com
Last Friday I wondered aloud if perhaps China and the US had struck a "backroom" deal regarding their roles in the ongoing "currency wars."
My primary reason for wondering this stemmed from a dramatic change in Treasury Secretary Tim Geithner's rhetoric concerning the US Dollar, combined with China's sudden decision to raise interest rates.
After all, the US had been branding China a currency manipulator and blaming it for the former's financial and economic woes for months. China, in turn, had responded by lowering the rate of its purchases of Treasuries, charging that the US Fed was damaging global balances and issuing veiled threats that it might consider the "nuclear" option of actively dumping US debt.
A Vicious Circle
By MICHAEL SCHUMAN - Time.com
Why the U.S. Could Be Intensifying a Global Currency War
Formally, at least, the U.S. and China have avoided fighting an all-out currency war. Beijing has attempted to appease anger in Washington over its undervalued yuan by allowing it to (very) slowly creep upward against the dollar. The Obama Administration has sidestepped political pressure and delayed a decision, originally expected in mid-October, on whether or not to brand China a currency manipulator. Yet China and the U.S. are heading toward a currency war anyway - and the rest of the world could be affected too.
A Look inside Pandora's Box
By Lars Schall -
The US-economist James K. Galbraith gave a remarkable speech to the biennial convention of the CEP Union of Canada in Toronto on September 20, 2010. In that speech he looked inside Pandora's Box - and what he found as the root-cause for the crisis we face was: FRAUD. In the following interview related to this speech he explains the need "to take control over institutions and restructure them."
Case-Shiller August Home Price Data Disappoints
By JOSEPH LAZZARO - DailyFinance.com
In another setback for the U.S. housing sector, home prices in a widely cited 20-city index rose a less-than-expected 1.7% in August on a year-over-year basis, according to the S&P/Case-Shiller U.S. National Home Price survey. The weaker growth came as the federal homebuyer tax credit program ended.
On a month-over-month basis, home prices in the 20-city index fell 0.2% in August from July.
Economists surveyed by Bloomberg had expected home prices to fall 0.2% in August from July, and increase 2.2% on a year-over-year basis, after rising 0.6% in July from June, and increasing 3.2% in July, on a year-over-year basis.
Record-low mortgage rates will be gone in 2011: MBA Average rates on 30-year fixed-rate mortgage expected to jump above 5% By Amy Hoak, MarketWatch
ATLANTA (MarketWatch) - Mortgage rates may be as low as they'll get - rates are on course to rise, slowly moving toward 5% by the end of next year, according to the Mortgage Bankers Association's economic forecast, released Tuesday at the group's annual convention here.
The group predicts rates on the 30-year fixed-rate mortgage will average 4.4% in the fourth quarter of 2010, increasing to a 4.7% average in the first quarter of 2011, and climbing to 5.1% by the end of next year. That's barring any "blockbuster" announcement from the Federal Reserve next month, said Jay Brinkmann, chief economist of the MBA.
FHA Commish: Lenders Too Tight on Government Credit
NationalMortgageNews.com
Some lenders are taking reforms in the Federal Housing Administration credit policies too far, shutting the door on otherwise good candidates for home ownership, FHA Commissioner David Stevens said in Atlanta at the Mortgage Bankers Association's annual convention.
Over the last few months, the FHA has implemented sweeping underwriting changes in an attempt to protect the agency's bottom line while also providing wide access to its loan programs. But Stevens said that some lenders have gone overboard by tightening even further and limiting the market segments they serve.
"Even with the current extraordinarily high levels of affordability, access to credit continues to be a major barrier for potential home buyers," the FHA Secretary said.
FHA head: Mortgage industry has 'trust deficit'
By Al Yoon -
(Reuters) - The U.S. mortgage industry must do more to establish trust with consumers and take stronger steps to participate in government programs to help struggling borrowers, the head of the Federal Housing Administration said on Tuesday.
The industry faces "an enormous trust deficit," FHA Commissioner David Stevens said, after the discovery of errors and possible fraud in foreclosure practices by mortgage servicing companies have put a spotlight on the industry's shortcomings.
"There's a reflection in the media and a reflection in the industry that we aren't being held accountable enough," Stevens said at a meeting of the Mortgage Bankers Association.
US banks to resist loan mods in mortgage probe
Reuters - BusinessSoectator.com.au
SAN FRANCISCO - US banks being probed over their foreclosure practices expect to negotiate with state attorneys general, but they are unlikely to agree to forced loan modifications, lawyers for lenders said this week.
Big mortgage servicers such as Bank of America Corp and JPMorgan Chase & Co are under the microscope over the use of "robo-signers" -- people who sign hundreds of affidavits a day.
US attorneys general for all 50 states are jointly investigating whether bank units that foreclose on bad loans failed to review documents properly or submitted false information to evict delinquent borrowers.
The real foreclosure mess: Lack of accountability for banks
By Allan Sloan - Fortune via WashingtonPost.com
The biggest danger to the U.S. capitalist system doesn't come from communists or community activists or left-wing academics. It comes from some of the nation's biggest financial institutions. These companies, which helped create the financial meltdown that touched off the Great Recession, have found yet another way to undermine the public's faith in capitalism and markets: the foreclosure fiasco.
Even before the foreclosure problem appeared, the level of public distrust of our financial and political systems was approaching the pathological. It's going to get even worse when the true lesson of this episode sinks in. To wit: If you mess up big-time when you deal with a giant bank, you're toast. If the giant bank messes up when it deals with you, it gets a do-over.
The Mess Mortgage Bankers Made is Criminal, Not Accidental
By Lee Adler - Radio Free Wall Street
Lee Adler and Aaron Krowne discuss the causes, mechanics, and implications of the mortgage mess. This is a free podcast available to all.
PayPal Unveils Payment System Aimed at Digital Goods
By GEOFFREY A. FOWLER And RUSSELL ADAMS - WSJ.com
EBay Inc.'s PayPal unit unveiled a new system Tuesday aimed at making it easier for consumers to pay for small online purchases of digital news articles, video clips or games.
The system, which PayPal disclosed at its second annual conference for software developers in San Francisco, will allow consumers to pay for such digital goods with as few as two clicks, without switching websites or having to re-enter credit-card or bank details.
PayPal said it will continue charging sellers of digital goods five cents plus 5% of the transaction price for purchases of less than $12.
Congressional Report Casts Doubt on Constitutionality of Obamacare's Individual Mandate By Matt Cover
(CNSNews.com) - A report from the Congressional Research Service (CRS) casts doubt on the two main arguments used by the Obama administration to defend the individual insurance mandate that is the central component of the controversial health "reform" law.
Published on October 15, the CRS report examines the arguments both for and against the constitutionality of the individual mandate, which requires every American to purchase government-approved health insurance or else pay a fine. (Read the report here: Requiring Individuals to Obtain Health Insurance - A Constitutional Analysis.pdf)
The mandate, to be enforced by the Internal Revenue Service, has been challenged as an unconstitutional overreach of federal authority in a lawsuit filed by Virginia Attorney General Ken Cuccinelli.
The CRS report finds that the two primary defenses of the mandate - that it is a tax and that Congress can impose it under the Commerce Clause - to be problematic.
Soros gives $1M to Calif. pot legalization measure
By MARCUS WOHLSEN - AP via WashingtonPost.com
SAN FRANCISCO -- Billionaire financier George Soros has thrown his weight behind California's marijuana legalization measure with a $1 million donation a week before the vote.
The contribution reported Tuesday by The Sacramento Bee is the single biggest donation from an individual other than Proposition 19's main sponsor, Oakland medical marijuana entrepreneur Richard Lee.
Soros, a high-profile liberal and philanthropist, has long backed drug law reform. He was one of the top financial backers of California's first-in-the-nation measure that legalized medical marijuana in the state in 1996.
Nevada voting machines automatically checking Harry Reid's name; voting machine technicians are SEIU members
By: Mark Hemingway - Washington Examiner.com
Clark County is where three quarters of Nevada's residents and live and where Senate Majority Leader Harry Reid's son Rory is a county commissioner. Rory is also a Democratic candidate for governor.
Since early voting started, there have been credible reports that voting machines in Clark County, Nevada are automatically checking Harry Reid's name on the ballot:
Voter Joyce Ferrara said when they went to vote for Republican Sharron Angle, her Democratic opponent, Sen. Harry Reid's name was already checked.
Ferrara said she wasn't alone in her voting experience. She said her husband and several others voting at the same time all had the same thing happen.
The Tea Party movement: deluded and inspired by billionaires By funding numerous rightwing organisations, the mega-rich Koch brothers have duped millions into supporting big business
George Monbiot - guardian.co.uk
The Tea Party movement is remarkable in two respects. It is one of the biggest exercises in false consciousness the world has seen - and the biggest Astroturf operation in history. These accomplishments are closely related.
An Astroturf campaign is a fake grassroots movement: it purports to be a spontaneous uprising of concerned citizens, but in reality it is founded and funded by elite interests. Some Astroturf campaigns have no grassroots component at all. Others catalyse and direct real mobilisations. The Tea Party belongs in the second category. It is mostly composed of passionate, well-meaning people who think they are fighting elite power, unaware that they have been organised by the very interests they believe they are confronting. We now have powerful evidence that the movement was established and has been guided with the help of money from billionaires and big business. Much of this money, as well as much of the strategy and staffing, were provided by two brothers who run what they call "the biggest company you've never heard of".
If God Says Civil Government is Oppressive, Haughty, and Abusive; Why Do Religious Institutions Promote It Anyway?
Steve and Debra Wallace - The End Times Hoax
How many of us have heard those in the mainstream religious community, examining the purpose of government, say, "Government was divinely ordained or instituted by God for the purpose of punishing evildoers?" The obvious derivative to this mainstream conclusion is that we should obey, honor, and give reverence to 'the powers that be' because they are God's ministers or servants doing the work of God. Those making this proclamation rely heavily on Romans 13:1-7 in arriving at what we believe to be an erroneous conclusion.
Gas Prices Jump Higher, but Not Because of Rising Demand
By PETER COHAN - DailyFinance.com
Has the U.S. economy suddenly improved so much that gasoline demand is pushing pump prices up again? They've jumped by a nickel in past two weeks alone.
At least part of the answer can be found in hedge funds that are placing bets on rising gasoline prices for two reasons. Strikers in France shut down refineries that ship gasoline to U.S. East Coast, and the proportion of corn-based ethanol the government will allow in gasoline is rising from 10% to 15%. With corn prices spiking, that's a recipe for you to pay more at the pump.
The End of Cheap Food
By Eric Fry - The DailyReckoning.com
10/26/10 Laguna Beach, California - Food is the ultimate regressive tax, which is why it might offer some of the most compelling investment opportunities of the next ten years.
The prince dispenses the same number of tuppence for his crumpet as the pauper. But as a percentage of their respective incomes, the crumpet is much more costly for the pauper. This contrast is obvious, but the implications of this contrast for global food prices may be less obvious.
The poor spend as much as they possibly can to nourish themselves. The wealthy spend as much as they wish. In fact, because the cost of food does not rise commensurately with incomes, the cost of food becomes so trivial to the wealthy that they end up tossing the stuff into trashcans.
The Food Shock of 2011
By Addison Wiggin - The DailyReckoning.com
10/26/10 Baltimore, Maryland - Every month, JP Morgan Chase dispatches a researcher to several supermarkets in Virginia. The task - to comparison shop for 31 items.
In July, the firm's personal shopper came back with a stunning report: Wal-Mart had raised its prices 5.8% during the previous month. More significantly, its prices were approaching the levels of competing stores run by Kroger and Safeway. The "low-price leader" still holds its title, but by a noticeably slimmer margin.
Within this tale lie several lessons you can put to work to make money. And it's best to get started soonÉbecause if you think your grocery bill is already high, you ain't seen nothing yet. In fact, we could be just one supply shock away from a full-blown food crisis that would make the price spikes of 2008 look like a happy memory.
Fact is; the food crisis of 2008 never really went away.
Will Britain sell off its public forests?
Posted by Eben Harrell - Time.com
One of the major environmental challenges today is the task of convincing many developing economies in the tropics to protect their forests. But some countries up north in the developed world may soon understand how difficult it can be to strike a balance between economic pressures and arboreal conservation, at least according to a report in Britain's Sunday Telegraph.
According to the paper, the British government is planning a massive sell-off of the country's state-owned forests as they seek to raise billions of dollars to help cut the deficit. Here's the kernel of the story:
Caroline Spelman, the Environment Secretary, is expected to announce plans within days to dispose of about half of the 748,000 hectares of woodland overseen by the Forestry Commission by 2020.
The controversial decision will pave the way for a huge expansion in the number of Center Parcs-style holiday villages, golf courses, adventure sites and commercial logging operations throughout Britain as land is sold to private companies.
Russian military could be drawn back into Afghanistan Nato officials explore joint initiatives ahead of landmark alliance summit, which is to include President Medvedev
Simon Tisdall in Brussels - guardian.co.uk
Russia's military could be drawn back into the Afghanistan theatre for the first time since the Red Army was forcibly expelled by US-backed mujahideen fighters in 1989 under plans being discussed by Nato officials. The proposals precede a landmark alliance summit next month, to be attended by the Russian president, Dmitry Medvedev.
The officials said several joint Nato-Russian initiatives on Afghanistan were on the table. They include the contribution of Russian helicopters and crews to train Afghan pilots, possible Russian assistance in training Afghan national security forces, increased co-operation on counter-narcotics and border security, and improved transit and supply routes for Nato forces.
Russian corruption takes on a life of its own
By Will Englund - Washington Post Foreign Service
Russia most corrupt among global powers, study says
MOSCOW - In Russia, the greased palm has overtaken the strong hand. For the past decade, Vladimir Putin, now the prime minister, has been building a tightly centralized, practically unaccountable political structure - a structure that tolerates and is highly susceptible to corruption. But now that corruption appears to have expanded beyond the Kremlin's control.
The current president, Dmitry Medvedev, is anxious to deepen Russia's economic relations with the West after the battering of the 2008 financial crisis. He has brought Russia to the doorstep of the World Trade Organization. This month, he led California Gov. Arnold Schwarzenegger (R) and an American delegation to a new school of management that he hopes will spawn Russia's version of Silicon Valley. On Tuesday, he chaired a meeting in the central Russian city of Naberezhnyye Chelny on ways to improve the country's economic efficiency.
Saddam Hussein's foreign minister Tariq Aziz sentenced to death for persecution of Shiites
By Ernesto Londono - Washington Post Foreign Service
BAGHDAD - An Iraqi court on Tuesday sentenced Tariq Aziz, a senior member in Saddam Hussein's government, to death by hanging for the persecution of Shiites after the Gulf War, officials said.
The 74-year-old former foreign minister was the Hussein government's most prominent figure on the international stage and the only Christian in the former leader's inner circle.
His lawyer called the sentence a ploy by the government of Prime Minister Nouri al-Maliki to divert attention from recent revelations of widespread abuse of prison inmates by Iraqi security forces.
Credit to Obama for sticking with the Middle East.
But it's gone very wrong
A whiff of desperation is evident in US attempts to push Israeli-Palestinian talks. The president must start changing course Jonathan Freedland in Washington - guardian.co.uk
The august ranks of those who form the conventional wisdom in American politics are as one: Barack Obama's Democrats are going to take a hammering in next Tuesday's midterm elections. One of the few elements of the Obama record not blamed is also, paradoxically, one of those areas that need to change on 3 November. It is the administration's handling of the peace process between Israelis and Palestinians.
High Anxiety in Iran: Awaiting Economic Reform
By TIME Staff
While office workers and students relaxed on the benches and well-watered lawns of Central Tehran's City Park one day last week, 40-year old Habib had little reason to enjoy his pleasant surroundings. He had just been fired that morning from his job as a construction worker after complaining to his employer that he had not been paid for two months. He, like countless other unemployed men in the capital, will spend the afternoon in the park scanning the familiar red and black print of the jobs supplement of Tehran's most popular newspaper, Hamshahri. "Last week I wanted to kill myself, my life has gone so out of control," Habib says, "It's not just me, the whole of the lower classes are suffering in their souls."
Foreclose on the Fraudsters, Part 1: Put Bank of America in Receivership
By William K. Black and L. Randall Wray - HuffingtonPost.com
After a quick review of its procedures, Bank of America this week announced that it will resume its foreclosures in 23 lucky states next Monday. While the evidence is overwhelming that the entire foreclosure process is riddled with fraud, President Obama refuses to support a national moratorium. Indeed, his spokesmen on the issue told reporters three key things. As the Los Angeles Times reported:
A government review of botched foreclosure paperwork so far has found that the problems do not pose a "systemic" threat to the financial system, a top Obama administration official said Wednesday.
Yes, that's right. HUD reviewed the "paperwork" problem to see whether it threatened the banks -- not the homeowners who were the victims of foreclosure fraud. But it got worse, for the second point was how the government would respond to the epidemic of foreclosure fraud.
Treasury Draws Negative Yield for First Time During TIPS Sale
By Cordell Eddings and Daniel Kruger via WashingtonPost.com
Oct. 25 (Bloomberg) -- The Treasury sold $10 billion of five-year Treasury Inflation Protected Securities at a negative yield for the first time at a U.S. debt auction as investors bet the Federal Reserve will be successful in sparking inflation.
The securities drew a yield of negative 0.55 percent, the same as the average forecast in a Bloomberg News survey of 7 of the Fed's 18 primary dealers. The sale was a reopening of an $11 billion offering in April. Conventional Treasury notes erased gains amid speculation on the amount of debt the Fed may buy to spur the economy in a tactic called quantitative easing.
"It signals people's expectation of the Fed being able to create some inflation with the QE program," said Alex Li, an interest-rate strategist in New York at Deutsche Bank AG, one of 18 primary dealers required to bid at Treasury auctions. "With nominal rates so low, in order have high TIPS breakevens you've got to have negative real yields on the five-year."
Key Tax Breaks at Risk as Panel Looks at Cuts
By DAMIAN PALETTA - WSJ.com
Sacrosanct tax breaks, including deductions on mortgage interest, remain on the table just weeks before the deficit commission issues recommendations on policies to pare back with the aim of balancing the budget by 2015.
The tax benefits are hugely popular with the public but they have drawn the panel's focus, in part because the White House has said these and other breaks cost the government about $1 trillion a year.
At stake, in addition to the mortgage-interest deductions, are child tax credits and the ability of employees to pay their portion of their health-insurance tab with pretax dollars. Commission officials are expected to look at preserving these breaks but at a lower level, according to people familiar with the matter.
Is the U.S. Federal Reserve Setting the Stage for Hyperinflation?
BY DON MILLER, Associate Editor, Money Morning
The U.S. government wants to stimulate growth in the moribund economy by stoking the fires of inflation. But by leaving interest rates low and buying up bonds - a policy known as quantitative easing (QE) - the U.S. Federal Reserve risks debasing the dollar, which could lead to a prolonged period of hyperinflation that would send prices skyrocketing.
After their most recent meeting on Sept. 21, Fed policymakers said low inflation warranted looser monetary policy. Minutes from the meeting said central bankers were prepared to ease policy to boost inflation expectations "before long."
The Fed is seeking ways to boost the U.S. economy after keeping interest rates at record lows and buying in $1.7 trillion of U.S. securities. The next move may be another round of quantitative easing that would expand the Fed's balance sheet even further.
NJ Turnpike Scandal a Microcosm of America
By Robert Morley - theTrumpet.com Ever wonder why the richest country in the world is bankrupt?
This is why.
The New Jersey Turnpike Authority is spending tens of millions on unjustified bonuses, perks and double-overlapping bonuses - even as the state careens toward bankruptcy, Fox News has reported. The public sector unions are so strong, and the state so weak, that workers are even paid a bonus to come in to work on their birthday. No joke.
Two years after the failure of Lehman brothers and the onset of hard recession, New Jersey is still spending tax dollars on birthday bonuses. Meanwhile, unemployment has skyrocketed and 15 percent of homes being sold in the state are foreclosures.
But birthday bonuses are only the beginning.
One Turnpike employee who recently retired with a base salary of $73,469 received a whopping $321,985 in extra payouts. He took home $143,806 in paid sick leave, $87,380 in vacation leave, $53,497 involuntary separation (whatever that is), $24,600 in separation bonus (whatever that is), $7,559 in unused vacation, and $5,143 in longevity payout.
We See Totally Surreal Markets
By Bob Chapman - TheInternationalForecaster.com
US dollar finding a temporary bottom, gold, silver, and commodities continue to make sense, mortgage scandals, surreal markets, dollar devaluation guaranteed, record deficits, US finally tries to live within its means.
As we write, the US dollar is in the process of trying to find at least a temporary bottom at 76.50 and to launch a countertrend rally. We would think a rally back to 80 is achievable, but we do not believe it's sustainable - only some stabilization through the election. Japan drew a line in the sand at 82 and finished last Friday trading at 81.37. That does not smack of success, but we see improvement over the next two weeks.
Goldman says Fed faces $4 trillion hole
Posted by Colin Barr - Fortune CNNMoney.com
Talk about shock and awe.
Economists at Goldman Sachs estimate the Federal Reserve may need to buy a staggering $4 trillion worth of assets such as Treasury securities to get the economy rolling again.
The Goldman economists, Jan Hatzius and Sven Jari Stehn, don't expect the Federal Reserve to go nearly that far when it resumes its asset-purchasing quantitative easing policy. Citing many officials' unease with the prospect of adding significantly to the Fed's already bloated balance sheet, Goldman expects the Fed to end up buying around $2 trillion worth of assets over the next few years.
Debt Has Increased $5 Trillion Since Speaker Pelosi Vowed, 'No New Deficit Spending'
By Terence P. Jeffrey
(CNSNews.com) - When Rep. Nancy Pelosi (D-Calif.) gave her inaugural address as speaker of the House in 2007, she vowed there would be "no new deficit spending." Since that day, the national debt has increased by $5 trillion, according to the U.S. Treasury Department.
"After years of historic deficits, this 110th Congress will commit itself to a higher standard: Pay as you go, no new deficit spending," Pelosi said in her speech from the speaker's podium. "Our new America will provide unlimited opportunity for future generations, not burden them with mountains of debt."
When a Bank Fails
Posted by Massimo Calabresi - Time.com
I have a longer piece in this week's print and IPad editions on how the failure of a community bank in Cornelia, Georgia, has undermined the town's confidence in government, the economy and itself.
While the big banks have largely stabilized, small bank failures are still growing, and the piece addresses a few issues that come with that crisis. First, it lays out how Community Bank and Trust, a pillar of Cornelia since 1900, managed to destroy itself through lax lending practices and criminal fraud. Second, it shows how the government, in the form of the FDIC, took over the failed bank and saved it by selling it to a stable, out-of-state one that agreed to take over nearly all the assets and liabilities in exchange for the FDIC shouldering most of the loan losses. Third, it looks at local allegations that the FDIC deal is responsible for Cornelia's ongoing woes because it created incentives for foreclosure.
Future bright for gold, bleak for US dollar "We will not devalue the US Dollar," US Treasury Secretary Tim Geithner said last week (or words to that effect), writes Steve Sjuggerud in his Daily Wealth email.
And by golly, the people believed him! The Dollar soared on his "reassurance". Gold Prices fell.
Wow ... I was stunned.
Do THAT many investors NOT know their economic history?
On June 30, 1997, Thailand's leader said, "We will not devalue our currency." Like Geithner this week, Thailand's leader backed it up with all kinds of powerful, incontrovertible statements...like "if the currency is devalued, we will all become poor."
But three days later, on July 3, 1997, Thailand devalued its currency.
The currency crashed. Check out Thailand stock market during the time of the crisis...down 90% in terms of US Dollars:
Can you imagine a 90% bust?
Buyers Pour into Gold and Silver Rally After G20 Failure
By: Adrian_Ash - MarketOracle.co.uk
THE PRICE OF PHYSICAL gold bullion rallied 1.2% against the Dollar and 0.8% against the Euro in Asian and early London trade on Monday, rising as "buying poured into the market" after the weekend's inconclusive G20 summit, according to one Hong Kong dealer.
"It was practically a one-way street. Every pullback was minimal and attracted more buying."
"Finance leaders at the weekend's G-20 meeting [in Seoul] stated their commitment to limiting currency intervention," notes Standard Bank here in London today, "but failed to announce any concrete actions/policies regarding currency devaluation."
"[So] the Dollar has weakened significantly against most major currencies ... and commodity prices are mirroring movements in the Dollar market."
Gold Jumps as Dollar Drops; Palladium Climbs to Nine-Year High
By Pham-Duy Nguyen and Nicholas Larkin
Oct. 25 (Bloomberg) -- Gold futures rose the most in more than a week as the dollar fell, boosting demand for the precious metal as an alternative investment. Palladium advanced to a nine-year high.
The greenback dropped as much as 1 percent against a basket of major currencies. A Group of 20 pledge to avoid "competitive devaluation" failed to ease speculation that the Federal Reserve will make more bond purchases, eroding the value of the dollar. Before today, gold gained 21 percent this year, reaching a record $1,388.10 an ounce on Oct. 14.
Peter Schiff on CNBC Fast Money 10/25/10
Currency Wars, Ficitious Deflation Propaganda and Gold
By: Howard Katz - MarketOracle.co.uk
This past weekend the Group of 20 nations met to discuss the value of their currencies. These discussions are being called "wars" in the general media because, although there is no actual shooting or dropping of bombs, each nation approached them with the attitude appropriate to a war. "I'm going to get mine at the expense of my neighbor." To sum up the positions of all the nations at the talks: Nation 1: "I want my currency to be lower than your currency." Nation 2: "No, I want my currency to be lower than your currency."
Hey, wait a minute Mr. Gaithner, weren't you talking, just a minute ago, about love and good will toward all men? It's only the political right which engages in hate. Aren't you all men of the left? Aren't you for love and peace? Then how could you have come into a field as benign and harmonious as economics and turned it into a war? After all, Adam Smith showed us that everything in economics operates by a harmony of self interest.
Dollar Falls to 15-Year Low Versus Yen on Fed View After G-20
By Allison Bennett
Oct. 25 (Bloomberg) -- The dollar dropped to a 15-year low versus the yen after a Group of 20 pledge to avoid "competitive devaluation" failed to dispel bets that the Federal Reserve will debase the greenback by announcing more bond purchases.
The U.S. currency slid against most of its major counterparts as investors added to bets that more quantitative easing will support higher-returning assets. Australia's dollar was the biggest winner, advancing to within a cent of parity after a report showed producer prices rose in the third quarter faster than economists forecast.
German boom creates ECB policy nightmare as south lags
Blistering growth in Germany is aggravating the growing gap between the eurozone's North and South and may force the European Central Bank to tighten monetary policy long before the high-debt states are ready, Standard & Poor's has warned.
By Ambrose Evans-Pritchard - Telegraph.co.uk
A separate report by Simon Ward from Henderson Global Investors said eurozone indicators are showing "unprecedented divergence", with the M1 money supply booming at double-digit rates in Germany but contracting in Spain, Ireland, and Greece.
S&P said Germany has been able to lever recovery off the emerging market boom, leaving Southern Europe behind. German exports - mostly machines and cars - account for 47pc of all EU goods shipped to China. France is a distant second at 10pc.
Why China Should Revalue
by the Center for Geoeconomic Studies - CFR
China will hit a "growth wall" within the next three years, according to NYU economist Nouriel Roubini. The country's reliance on fueling GDP growth through exports is unsustainable. He argues that China needs to revalue its currency so as to allow a transition from export-led to domestic demand-led growth. "The real income of households is going to increase, and they're going to consume more. You export less and you consume more."
Jim Rogers on the currency war 22 Oct 2010
G-20 Meeting Doesn't Stop Dollar's Slide
By MELLY ALAZRAKI - DailyFinance.com
At a meeting in South Korea over the weekend, the G-20 finance ministers promised to avoid weakening currencies to lift exports. They agreed to try to reduce trade imbalances, but stopped short of setting specific targets, as had been proposed by the U.S., Bloomberg reported.
In a surprise move, however, the finance chiefs also vowed to give emerging nations a bigger voice in the International Monetary Fund, recognizing the quickening shift in economic power away from Western industrial nations, Reuters reported.
The ministers forswore "competitive devaluation" to calm recent fears of an emerging currency and trade war stemming from using cheaper currencies to spur growth, but they failed to agree on a U.S. proposal for targets that was aimed to pressure China to allow faster gains in the yuan. That decision was left up to the G-20 leaders, which are meeting in Seoul next month.
G20 will not take side over yuan US Treasury Secretary Timothy F. Geithner is in China to talk about currencies and exports. In South Korea, top financial officials decide not to decide.
Seoul (AsiaNews/Agencies) - Top financial officials from the Group of 20 will not intervene in the bitter confrontation opposing the United States and China over the yuan. Any decision about will be taken at next month's meeting of heads of state and governments in South Korea.
On Saturday, G20 finance ministers and central bank governors ended talks in South Korean city of Gyeongju foreswearing "competitive devaluation" as they sought to calm fears of a trade war stemming from the fear that cheaper currencies might be used to spur growth. By not taking any difficult decision, they have not however stopped the slide of the US dollar against the yuan.
Barack Obama's poor economic policies are playing into China's hands It's a quiet morning in the Famous Cozy Soup 'n' Burger diner on the corner of Astor Place and Broadway. "Sometimes it's busy, sometimes it's slow," says the waiter. "The economy is making it more slow than busy."
By Damian Reece - Telegraph.co.uk
He may have a while to wait before his tables are full again. The regulars keep coming but a return to the bustling peak of the last boom, which started to topple over in the final quarter of 2007, seems a long way off.
Americans are approaching next month's mid-term elections experiencing a new sensation - they're feeling poorer than five years ago. Not surprisingly they don't like it and Democrat candidates in the upcoming vote will feel the full force of their frustrations.
Goldman: The Fed Needs To Print $4 Trillion In New Money
Submitted by Tyler Durden - ZeroHedge.com
With just over a week left to the QE2 announcement, discussion over the amount, implications and effectiveness of QE2 are almost as prevalent (and moot) as those over the imminent collapse of the MBS system. Although whereas the latter is exclusively the provenance of legal interpretation of various contractual terms, and as such most who opine either way will soon be proven wrong to quite wrong, as in America contracts no longer are enforced (did nobody learn anything from the GM/Chrysler fiasco for pete's sake), when it comes to printing money the ultimate outcome will certainly have an impact. And the more the printing, the better. One of the amusing debates on the topic has been how much debt will the Fed print. Those who continue to refuse to acknowledge that the economy is in a near-comatose state, of course, hold on to the hope that the amount will be negligible: something like $500 billion (there was a time when half a trillion was a lot of money). A month ago we stated that the full amount will be much larger, and that the Fed will be a marginal buyer of up to $3 trillion. Turns out, even we were optimistic.
Federal Reserve Chairman Says Regulators Are Looking Into Foreclosure Mess By Jeannine Aversa, Associated Press
Washington (AP) - Federal banking regulators are examining whether mortgage companies cut corners on their own procedures when they moved to foreclose on people's homes, Federal Reserve Chairman Ben Bernanke said Monday.
Preliminary results of the in-depth review into the practices of the nation's largest mortgage companies are expected to be released next month, Bernanke said in remarks to a housing-finance conference in Arlington, Va.
"We are looking intensively at the firms' policies, procedures and internal controls related to foreclosures and seeking to determine whether systematic weaknesses are leading to improper foreclosures," Bernanke said. "We take violation of proper procedures very seriously," he added.
Treasury Shielding Citigroup as Deletions Make FOIA Meaningless
By Bob Ivry
Oct. 25 (Bloomberg) -- The late Bloomberg News reporter Mark Pittman asked the U.S. Treasury in January 2009 to identify $301 billion of securities owned by Citigroup Inc. that the government had agreed to guarantee. He made the request on the grounds that taxpayers ought to know how their money was being used.
More than 20 months later, after saying at least five times that a response was imminent, Treasury officials responded with 560 pages of printed-out e-mails -- none of which Pittman requested. They were so heavily redacted that most of what's left are everyday messages such as "Did you just try to call me?" and "Monday will be a busy day!"
Lenders, agencies hold event to offer foreclosure help
CantonRep.com staff report
About 200 people came looking for help at a foreclosure prevention event Monday, sponsored by Stark and Summit county and state officials.
Restoring Stability: A Save the Dream Ohio Initiative featured six lenders, a number of social agencies, and local and state officials to work with those in foreclosure or facing the prospect of losing their home.
Loss of employment and medical problems are two of the leading causes in the foreclosure crisis, and Chris Lenkowski, 50, of Barberton, has had both.
FDIC Head Sounds Alarm on Foreclosure Litigation
By: Reuters - CNBC.com
Litigation arising from the problems surrounding mortgage foreclosure paperwork could be "very damaging" to the housing market, a top U.S. banking regulator said on Monday.
Federal Deposit Insurance Corp Chairman Sheila Bair said she did not believe legislation would be needed to address concerns over whether the paperwork was properly done so long as investigations show the issue was mostly "procedural."
State and federal officials are investigating allegations that for years banks have not reviewed foreclosure documents properly or have submitted false statements to evict delinquent borrowers.
Refinancing Surge Gives Lift to Banks Amid Foreclosure Scrutiny
By Jody Shenn
Oct. 25 (Bloomberg) -- A rush by U.S. homeowners to refinance at near record-low interest rates marks a rare bright spot for the mortgage industry, under attack for choking the economy with shoddy loans and botched foreclosures.
Wells Fargo & Co., the biggest U.S. mortgage lender, received $194 billion of loan applications in the third quarter, the second-most in its history, Chief Financial Officer Howard Atkins said last week. About 80 percent were to refinance. Bank of America Corp. CFO Charles Noski said lending margins are up and demand should remain robust through yearend.
Fewer get modified mortgage under HAMP
By Thomas Frank, USA TODAY
WASHINGTON - The number of struggling homeowners who cut their mortgage payments in September through an Obama administration initiative fell to its lowest level in nearly a year, increasing debate about the program's effectiveness.
Nearly 28,000 homeowners reached agreements with mortgage servicers last month to permanently modify mortgages under the Home Affordable Modification Program (HAMP), a government report Monday shows. That's down from the record 68,000 modifications in April and the lowest number since November, shortly after HAMP launched.
"HAMP has been to date a disappointment," said Moody Analytics' chief economist Mark Zandi, adding that it is "set to fall well short of expectations."
Did GMAC Try to Bury Its Foreclosure Smoking Gun? The deposition the lender really, really doesn't want you to see.
By Andy Kroll MotherJones.com
Is GMAC Mortgage, the company under siege by numerous state attorneys general and members of Congress for its use of dubious foreclosure legal filings, trying to silence the lawyer who exposed the bank's practices? So says Thomas Cox, the Maine attorney whose case is at the center of GMAC's ongoing debacle.
It's been a rough few weeks for GMAC Mortgage, a subsidiary of the bank Ally Financial, which was bailed out by American taxpayers in 2008 to the tune of $16 billion. The first domino fell when Bloomberg reported on September 20 about a leaked internal memo directing mortgage brokers in 23 states to halt foreclosure evictions and sales, adding that the company may "need to take corrective action in connection with some foreclosures." In this case, "corrective action" meant cleaning up a trail of bogus legal paperwork stretching from Maine to Texas.
BANK OF AMERICA FINDS FORECLOSURE MISTAKES
WHILE PREPARING LESS THAN 1 PERCENT OF FORECLOSURE FILES The bank found errors in 10 to 25 out of the first several hundred foreclosure it examined starting last Monday
4ClosureFraud.com
No widespread problem here, right BOA?
By the way, most of these "errors" are FELONIES!
BANK OF AMERICA FINDS FORECLOSURE MISTAKES: REPORT
Bank of America acknowledged some mistakes in foreclosure files as it begins to resubmit documents in 102,000 cases, the Wall Street Journal said.
The bank found errors in 10 to 25 out of the first several hundred foreclosure it examined starting last Monday, the newspaper said.
The problems included improper paperwork, lack of signatures and missing files, as well as cases in which information about the property and payment history being unmatched, the Journal said.
The bank told the newspaper that some of the defects seem relatively minor, and the bank has not found any evidence of wrongful foreclosures.
The bank found the errors while preparing less than 1 percent of the first foreclosure files that it intends to resubmit to the courts in 23 states, the Journal said.
Short Sales Resisted as Foreclosures Are Revived
By MICHAEL POWELL - NYTimes.com
PHOENIX - Bank of America and GMAC are firing up their formidable foreclosure machines again today, after a brief pause.
But hard-pressed homeowners like Lydia Sweetland are asking why lenders often balk at a less disruptive solution: short sales, which allow owners to sell deeply devalued homes for less than what remains on their mortgage.
Ms. Sweetland, 47, tried such a sale this summer out of desperation. She had lost her high-paying job and drained her once-flush retirement savings, and her bank, GMAC, wouldn't modify her mortgage. After seven months of being unable to pay her mortgage, she decided that a short sale would give her more time to move out of her Phoenix home and damage her credit rating less than a foreclosure.
U.S. Housing Subprime Mortgage Market Securitization Debacle,
They Knew What They Were Selling
By: John Mauldin - MarketOracle.co.uk
At the end of last week's letter on the whole mortgage foreclosure mess, I wrote: "All those subprime and Alt-A mortgages written in the middle of the last decade? They were packaged and sold in securities. They have had huge losses. But those securities had representations and warranties about what was in them. And guess what, the investment banks may have stretched credibility about those warranties. There is the real probability that the investment banks that sold them are going to have to buy them back. We are talking the potential for multiple hundreds of billions of dollars in losses that will have to be eaten by the large investment banks. We will get into details, but it could create the potential for some banks to have real problems."
99ers Economics - The Plight of America's Long-Term Unemployed
Millions of Long-Term Unemployed are Struggling
The Wake of the Financial Meltdown - The effects of the financial carnage resulting from the mortgage meltdown have rippled into the mainstream American economy. Unemployment has soared and a new word has entered the American vocabulary -'99er'. The term 99er refers to a long-term unemployed worker who has collected unemployment benefits for the maximum allowable period of 99 weeks. Once 99 weeks of unemployment benefits have been paid out, the worker is no longer eligible to collect anymore support. How many workers fall into the category of 99ers? Estimates range from 1.3 to 4.0 million people in the U.S. who have been unemployed for 99 weeks or more.
Unemployment Benefits: The 99ers
Are employers looking to use Obamcare as an excuse
to drop their health insurance plans?
By: Mark Hemingway - Washington Examiner.com
Remember! Obama promised that if you like your health insurance, you can keep it. Corporate bean counters, however, are weighing their options. Companies such as McDonalds, 3M and, most recently, Boeing have made it known that Obamacare is threatening the existence of their health care plans. Critics of the health care bill have from the beginning warned that this might happen - and shortly after the legislation was passed it was reported that major corporations were already exploring the possibility of dumping their health insurance plans. If the dam burst and millions were sent to fend for themselves in the exchanges, it would send the costs of the already insanely expensive health care bill through the roof.
The White House says the idea that employers would drop their health insurance plans for employees is crazy talk. However, the Democratic governor of Tennessee and business consultants at Deloitte say employers are definitely considering doing just that:
In wake of health care law, employers are reviewing their options
on benefits for workers
By: RICARDO ALONSO-ZALDIVAR - Washington Examiner.com
WASHINGTON - The new health care law wasn't supposed to undercut employer plans that have provided most people in the U.S. with coverage for generations.
But last week a leading manufacturer told workers their costs will jump partly because of the law. Also, a Democratic governor laid out a scheme for employers to get out of health care by shifting workers into taxpayer-subsidized insurance markets that open in 2014.
While it's too early to proclaim the demise of job-based coverage, corporate number crunchers are looking at options that could lead to major changes. Gov. Phil Bredesen, D-Tenn., said the economics of dropping coverage are "about to become very attractive to many employers, both public and private."
That's just not going to happen, White House officials say.
L.A. Stimulus: $10 Million to Create One Job
Mac Slavo - The Daily Sheeple
When President Obama and Congress passed a multi-billion dollar jobs creation bill it was widely reported that tens of thousands of jobs would be saved or created as a result. Contrary opinions from opponents of the bill argued that only the free market, not government, is capable of creating sustainable, meaningful labor and that the billions spent would end up being more wasteful spending.
According to Los Angeles City Controller Wendy Greuel, the contrarians may have been right.
In a recent audit and follow-up press release, the city controller's office says that of the $111 million in stimulus funds the city has already received of the $594 originally awarded, the city has created or retained a total 54.46 jobs.
Ron Paul's Texas Straight Talk 10/25/10
Catholic Cleric: Jesus Cancelled Biblical 'Chosen People'
by Tzvi Ben Gedalyahu - IsraelNationalNews.com
The Creator's promise in the Bible that the Promised Land belongs to the Jewish People is no longer valid, a Catholic synod declared. An American archbishop at the Synod explained Saturday that the promise of the Creator was "abolished by the presence of Christ."
In a decision that is bound to set off a furious reaction from many Jewish leaders, the synod concluded that "recourse to theological and biblical positions which use the Word of G-d to wrongly justify injustices is not acceptable."
However, an inherently contradictory Synod statement also declared, "The same Scriptures unite us; the Old Testament, the Word of G-d is for both you and us... We believe in the promises of God and his covenant given to Abraham and to you. We believe that the Word of G-d is eternal."
Israel slams Catholic statement on Mideast, singling out archbishop
By the CNN Wire Staff
Jerusalem, Israel (CNN) -- A top Israeli official on Sunday criticized a new statement from Catholic bishops on the Middle East and blasted the remarks of a Catholic archbishop who spearheaded the statement as "libel."
On Saturday, Catholic bishops from the Middle East concluded a two-week conference in Rome, Italy, with a call for the international community, especially the United Nations, to work "to put an end to the occupation" of Palestinian territories.
On Sunday, Israeli Deputy Foreign Minister Danny Ayalon criticized that concluding statement of the conference, called a synod.
Atheism Becoming the New Religion, Evangelicals Warned
By Maria Mackay - ChristianPost.com
CAPE TOWN, South Africa - Evangelicals heard the call on Monday to be guardians of the truth in the face of widespread indifference to religion and the "denial" of Scripture within parts of the church.
Carver Yu, president of the China Graduate School of Theology in Hong Kong, said that "confusing ideologies" were creating emptiness and alienation among people, while indifference to religion was "tightening its grip."
He said the recent advertising campaign by Richard Dawkins and other atheists on London buses was a perfect example of the "enthusiastic zeal" with which atheists were campaigning against Christianity and religion.
A Web Pioneer Profiles Users by Name
By EMILY STEEL - WSJ.com
In the weeks before the New Hampshire primary last month, Linda Twombly of Nashua says she was peppered with online ads for Republican Senate hopeful Jim Bender.
It was no accident. An online tracking company called RapLeaf Inc. had correctly identified her as a conservative who is interested in Republican politics, has an interest in the Bible and contributes to political and environmental causes. Mrs. Twombly's profile is part of RapLeaf's rich trove of data, garnered from a variety of sources and which both political parties have tapped.
RapLeaf knows even more about Mrs. Twombly and millions of other Americans: their real names and email addresses.
Did 4.3 Million People Reject a Job and Stay on Unemployment Instead?
By PETER COHAN - DailyFinance.com
Government-funded unemployment insurance payments have probably kept millions of people from living on the streets and starving during this recession. So naturally, jobless benefits are to blame for the high unemployment rate. Or so argues Harvard professor Robert Barro in The Wall Street Journal. JPMorgan Chase (JPM) issued a similar analysis in March 2010. Still, that logic isn't persuasive -- although it's popular among those who would like to roll back the U.S. to the way it was before FDR.
Barro argues that unemployment insurance makes people turn down job offers so they can sit on their couches all day collecting money from the government. More specifically, he argues that if the government cut off unemployment insurance after 26 weeks instead of extending it to the current 99, the jobless rate would be 6.8% instead of 9.5%. And if that were the case, he suggests, the party in power would face happier results in the upcoming midterm elections.
Coping with poor, confused consumers
Posted by Nin-Hai Tseng, Fortune The growing number of Americans living below the poverty line is troubling on many levels, and it's a problem that consumer companies can no longer ignore.
According to new government data, one in seven Americans lives in poverty -- the highest level in 15 years -- and many more are staying above the poverty line only because of government benefits. Most of these people have virtually no money left over at the end of the month for discretionary spending on everything from clothes to cable.
This is significant for companies selling consumer goods and services -- if they're not necessary for survival, they're more likely to be cut from household budgets. And as the unemployment rate remains high and government benefits continue to expire, it will become increasingly difficult to acquire new customers.
Barack and Michelle's Mumbai darshan plans
The Economic Times The Obamas booked the entire 5-star Taj Mahal Hotel for India trip after the elections
US President Barack Obama and First Lady Michelle will be extremely busy in Mumbai, upon landing on November 6 for a two day India visit. As the world's most powerful man and his wife zip around the city visiting the 26/11 memorial on Marine Drive, the National Centre for Performing Arts (NCPA), Mani Bhawan and other locations in south Mumbai, the security obviously will be water-tight .Adding to the Obamas' busy schedule is Michelle's likely visit to Kamathipura, where she will meet commercial sex workers on the invitation of an NGO. The highprofile visit is likely to inconvenience the citizens, as there could be a complete clampdown on traffic on some main roads of south Mumbai and sanitisation of buildings flanking them.
The Obamas will stay at the Taj Mahal Hotel, and his itinerary practically means Marine Drive will be shut for vehicular traffic on the day of the President's visit, while buildings flanking it will be sanitised with security personnel manning them until Obama has left the place. Same would be the case with Obama's visit to Mani Bhawan and Michelle going to Kamathipura.
Ron Paul on Taxes Fox Business October 20 2010
CONSERVATIVES BEHIND THE CURVE ON OBAMA
By Cliff Kincaid
NewsWithViews.com
Dinesh D'Souza says in his new book that Barack Obama is an anti-colonialist. Stanley Kurtz has a new book, Radical-in-Chief, which says Obama is a socialist. The new book Dupes by Paul Kengor tells the unvarnished truth. And that's because he make use of material we started releasing back in February of 2008 about Obama's communist mentor, Communist Party USA member Frank Marshall Davis. New Zealand blogger Trevor Loudon broke that story and we confirmed it.
I hate to say, "We told you so," but Herb Romerstein and I held a briefing in May 0f 2008 in Washington, D.C. releasing two reports, "Communism in Chicago and the Obama Connection," and "Communism in Hawaii and the Obama Connection." Then, in August of 2008, I released the 600-page FBI file on Frank Marshall Davis. The response from the media included Dana Milbank of The Washington Post making fun of us and Matt Drudge of the Drudge Report refusing to run paid advertising on the Obama-Davis connection. The liberal and conservative media had their heads in the sand. They couldn't come to grips with the unprecedented prospect of a possible agent of influence for the international Marxist movement occupying the Oval Office.
Why is the State Department having a New York Times reporter
brief the foreign press on the Tea Party?
By: Mark Hemingway - Washington Examiner.com
At the State Department they have something known as the Foreign Press Center. Here's how it's described on the State Department's website:
The United States Department of State has Foreign Press Centers in Washington, D.C. and New York. The Foreign Press Centers support U.S. policies by helping foreign media cover the U.S. Their goal is to promote the depth, accuracy, and balance of foreign reporting from the U.S., by providing direct access to authoritative American information sources.
Authoritative American sources, huh? Then someone please explain to me why the State Department is having Kate Zernike, the New York Times' hackish Tea Party correspondent, brief the foreign press on the movement. For a primer on her wanting Tea Party coverage, see Examiner columnist Tim Carney's discussion of her laughable innuendo that the Tea Party is racist here. Also see Jonah Goldberg's more recent criticism where he notes that in Zernike was ignorant (among other things) of what the phrase "rule of law" means.
Will the Federal Reserve Cause a Civil War?
Posted by Stephen Gande - Time.com
What is the most likely cause today of civil unrest? Immigration. Gay Marriage. Abortion. The Results of Election Day. The Mosque at Ground Zero. Nope.
Try the Federal Reserve. November 3rd is when the Federal Reserve's next policy committee meeting ends, and if you thought this was just another boring money meeting you would be wrong. It could be the most important meeting in Fed history, maybe. The US central bank is expected to announce its next move to boost the faltering economic recovery. To say there has been considerable debate and anxiety among Fed watchers about what the central bank should do would be an understatement. Chairman Ben Bernanke has indicated in recent speeches that the central bank plans to try to drive down already low-interest rates by buying up long-term bonds. A number of people both inside the Fed and out believe this is the wrong move. But one website seems to believe that Ben's plan might actually lead to armed conflict. Last week, the blog, Zerohedge wrote, paraphrasing a top economic forecaster David Rosenberg, that it believed the Fed's plan is not only moronic, but "positions US society one step closer to civil war if not worse."
DHS Conducts Nationwide ID Authentication Test
For Emergency Preparedness
TerraDaily.com Northrop Grumman and the U.S. Department of Homeland Security's Federal Emergency Management Agency (FEMA) recently coordinated a nationwide demonstration showing the ability to deploy a common, interoperable credentialing system that enables electronic identity authentication for government and industry personnel.
The demonstration, dubbed "Autumn Blend," showed the use of standardized personal identity credentials operating across multiple domains, such as a government's or company's credential authentication infrastructure, for access management decisions, situational awareness, cyber-secure capabilities and post-event reconstruction.
The US- Saudi Military Deal And Global Military Expenditure
by Chandra Muzaffar - GlobalResearch.ca
The US plan to sell US 60 billion dollars worth of military equipment to Saudi Arabia will not contribute to peace and security in the Middle East.
The biggest arms deal ever in history, it provides for the sale of jetfighters and helicopters to oil-rich Saudi Arabia over a period of 15 to 20 years. US officials have stated that it will enhance the security of its key allies in the region, especially in the context of the alleged threat from Iran. The Saudis, according to Pentagon sources, are worried about Iran's missile arsenal.
Independent political analysts, however, do not regard Iran as a threat to its Arab neighbours. While the rhetoric of some of its leaders may be belligerent, Iran's diplomatic moves since the late nineties have been aimed at strengthening its ties with states in the Persian Gulf region, including Saudi Arabia.
There are perhaps other motives behind the US-Saudi deal which have not been highlighted in the mainstream media. The sale reinforces US military hegemony in a region that it perceives as vital for its triple interests---- Israel, oil and geopolitical control. Since the sale is huge, it will help to fill the coffers of corporate weapons manufacturers at a time when the US economy is in deep trouble.
First joint Saudi-Egyptian maneuver ever was geared to Iranian threat
DEBKAfile.com
Egypt and Saudi Arabia secretly carried out their first ever joint exercise this week with the participation of their special operations, marine, armored, missile, air and naval forces, DEBKAfile's military sources reveal. Exercise Tabuk-2 was programmed to repulse a potential Iranian attack on Saudi Arabia by taking the battle over to Islamic Republican territory. Our sources note that a new chapter was written in Middle East military history this week: The two largest Arab nations deployed their military strength in position for combating the Iranian army and its Revolutionary Guards Corps and showed they were willing to counter Iranian belligerence by invading the aggressor.
Tabuk-2, which Riyadh and Cairo took care to keep under wraps, took place from Sunday, Oct. 17 to Wednesday Oct.21 under the command of Acting Saudi Defense and Aviation Minister, Prince Khaled Bin Sultan, son of Crown Prince Sultan.
The Secret War Between Wikileaks and the Pentagon
By: Danny Schechter - MarketOracle.co.uk
It happened on a Friday, the anniversary of the first US casualties of the Vietnam War way back in l957. It was also the anniversary, in l964, of French philosopher Jean Paul Sartre's announcement that he was turning down the Nobel Prize. He later sat as a judge on Bertrand Russell's Vietnam War Crimes Tribunal, which indicted that conflict's carnage and lies.
It was the day this year that the often shadowy Wikileaks, chief nemesis of the Pentagon, maybe their worst nightmare - considered perhaps even more dangerous than the Taliban-- surfaced again with the largest public drop of secret military documents in history. Wikileaks is a public web site run by the Sunshine Press, a non-profit group.
Pakistan Border Region Becomes Terror Epicenter
By Kathy Gannon, Associated Press
Peshawar, Pakistan (AP) - It's a land of daunting mountains, crisscrossed with rugged paths. Tucked in the valleys, families live a subsistence existence in mud houses secluded behind 10-foot-high walls, cooking over open fires and sleeping under the sky. Dirt poor, uneducated, their only knowledge of the outside world comes from a crackling radio.
The wilds of North Waziristan, on Pakistan's border with Afghanistan, have become a crossroads for terrorism. The United States is pushing Pakistan to mount an offensive there before the year is out, but Pakistan is saying it won't be rushed.
Ongoing Iran War Preparations? Arabian Sea:
Center Of West's 21st Century War
by Rick Rozoff - GlobalResearch.ca
The monumental expansion of arms sales and the buildup of naval and air power in the Arabian Sea region are unprecedented. They are also alarming to the highest degree.
A quarter of the world's nuclear aircraft carriers will soon be in the Arabian Sea.
The Nimitz class nuclear-powered supercarrier USS Abraham Lincoln arrived in the region on October 17 to join the USS Harry S. Truman Carrier Strike Group, which in turn had arrived there on June 18 as part of a regular rotation.
The Charles de Gaulle, flagship of the French navy, the country's only aircraft carrier and the sole non-American nuclear carrier, will soon join its two U.S. counterparts. The U.S. possesses half the world's twenty-two aircraft carriers, all eleven supercarriers (those displacing over 70,000 tons) and eleven of twelve nuclear carriers.
Hawkish Israeli minister drafts nuclear Iran plan
By Dan Williams - Reuters - Alternet.com
JERUSALEM, Oct 25 (Reuters) - Hardline Israeli Foreign Minister Avigdor Lieberman has commissioned a report on how to prepare for a nuclear-armed Iran as doubt mounts about the efficacy of preventive action, an Israeli source said on Monday.
Publicly, Israel has pledged to deny the Iranians the means to make a bomb but its previous, centrist government also discreetly drew up "day after" contingency plans should Tehran's uranium enrichment pass the military threshold.
At the time, rightist opposition leader Benjamin Netanyahu called for Israel to consider preemptive strikes against its arch-foe's nuclear sites. Now prime minister, Netanyahu has reined in such rhetoric while not ruling out the use of force.
Iraq secret files detail shadow war between US, Iran
SpaceWar.com
Secret US files released on Friday show Iran waging a shadow war with US troops in Iraq, with a firefight erupting on the border and Tehran allegedly using militias to kill and kidnap American soldiers.
The military intelligence reports on Iran's role, released by WikiLeaks and posted by The New York Times and the Guardian, provide details of a dangerous contest for influence in Iraq between Washington and Tehran.
But US allegations of Iran arming and training Shiite militants in Iraq are nothing new, and American officials and military commanders have long accused Tehran of trying to sow violence to undermine US influence and weaken its allies in Baghdad.
The Rise of China Looms Large as Hillary Clinton
Heads for Meetings With Asian Allies
By Patrick Goodenough
(CNSNews.com) - As Secretary of State Hillary Clinton begins a visit to Asia this week, she will meet first with her Japanese counterpart, at a time when tensions between Japan and China show no sign of abating.
Clinton will hold talks with Foreign Minister Seiji Maehara in Honolulu, before traveling to Vietnam to join an East Asia Summit. From there, she will visit five other countries, the State Department said.
Rwanda, China boost military ties
Kigali and Beijing agreed to enhance their military cooperation during a visit to China by Rwandan Defence Minister James Kaberebe, an army statement said Saturday.
Kaberebe held talks on Friday with his Chinese counterpart, Liang Guanglie, as part of his five-day visit to China, the statement said.
"The ministers pledged to deepen and widen military cooperation by opening up new areas of cooperation such as research and development, intensifying military visits and exchange programmes," it said.
U.S. Navy Exercise in Waters Near China Reportedly Canceled
By Patrick Goodenough
(CNSNews.com) - The U.S. and South Korea have called off plans for joint naval exercises in the coming days involving a U.S. aircraft carrier in the Yellow Sea, according to South Korean media reports.
Korean defense sources quoted in the reports linked the decision to the Nov. 11-12 G20 summit in Seoul, which will bring together President Obama and Chinese President Hu Jintao, along with other leaders from the group's leading and emerging economies.
IN MEMORY OF JOAN VEON
By Devvy Kidd - NewsWithViews.com
Joan Veon passed away, October 18, 2010.
America has lost one of its most ardent freedom fighters and a true lady.
Back in 2007, Joan was diagnosed with metastasis breast cancer. Because it had spread from the breast into the lymph nodes and spine, she was told her cancer was in a stage four.
That remarkable woman never stopped her efforts to expose the agenda of world government, even while fighting for her life.
Rosa Parks. In Memoriam: The Civil Rights Movement in the US
February 4, 1913 - October 24, 2005
Most historians date the beginning of the modern civil rights movement in the United States to December 1, 1955. That was the day when an unknown seamstress in Montgomery, Alabama refused to give up her bus seat to a white passenger. This brave woman, Rosa Parks, was arrested and fined for violating a city ordinance, but her lonely act of defiance began a movement that ended legal segregation in America, and made her an inspiration to freedom-loving people everywhere.
Lindsey Williams on The Alex Jones Show
Mon 10.25.2010 part-8
Lindsey Williams on The Alex Jones Show
Mon 10.25.2010 part-9
Lindsey Williams on The Alex Jones Show
Mon 10.25.2010 part-10
Lindsey Williams on The Alex Jones Show
Mon 10.25.2010 part-11
Lindsey Williams on The Alex Jones Show
Mon 10.25.2010 part-12
Lindsey Williams on The Alex Jones Show
Mon 10.25.2010 part-13
Lindsey Williams on The Alex Jones Show
Mon 10.25.2010 part-14
Lindsey Williams on The Alex Jones Show
Mon 10.25.2010 part-15
Regulators close seven more banks in U.S.
(Reuters) - The Federal Deposit Insurance Corp said on Friday that U.S. regulators closed seven more banks, bringing the total so far this year to 139.
The biggest was Hillcrest Bank of Overland Park, Kansas, which had approximately $1.65 billion in total assets and $1.54 billion in total deposits.
Regulators also closed First Arizona Savings, Scottsdale, Arizona; First Suburban National Bank, Maywood, Illinois; First National Bank of Barnesville, Barnesville, Georgia; Gordon Bank, Gordon, Georgia; Progress Bank of Florida, Tampa, Florida; and First Bank of Jacksonville, Jacksonville, Florida.
Say goodbye to free checking as banks seek new revenue
By Pallavi Gogoi, Associated Press
NEW YORK - Free checking as we know it is ending.
The days when you could walk into a bank branch and open an account with no charges and no strings attached appear to be over. Now you have to jump through some hoops - keep a high balance, use direct deposit or swipe your debit card several times a month.
One new account at Bank of America charges $8.95 per month if you want to bank with a teller or get a paper statement.
Almost all of the largest U.S. banks are either already making free checking much more difficult to get or expected to do so soon, with fees on even basic banking services.
G-20 Vows to Avoid a Currency War
By SEWELL CHAN NYTimes.com
Moving to shore up the "fragile and uneven" recovery, officials from the world's 20 biggest economies promised Saturday to refrain from weakening their currencies, agreeing to let the markets exert more influence in setting foreign exchange rates.
The officials also decided to give fast-growing countries a greater say at the International Monetary Fund, which monitors nations' fiscal and monetary policies, an acknowledgment that the fund's credibility required more representation from these nations. They also strengthened the I.M.F.'s role in assessing whether G-20 members were meeting their commitments.
G-20 to Avoid 'Competitive Devaluation' of Currencies
By Simon Kennedy and Shamim Adam
Oct. 25 (Bloomberg) -- Group of 20 finance chiefs vowed to avoid weakening currencies to lift exports and left it to a leaders' meeting next month to decide whether to further pressure member China to allow faster gains in the yuan.
Finance ministers and central bank governors ended talks in South Korea Oct. 23 foreswearing "competitive devaluation" as they sought to calm fears of a trade war stemming from using cheaper currencies to spur growth. They called for reduced trade imbalances while stopping short of a U.S. proposal for targets that was aimed at making a yuan advance more palatable to China.
Geithner in China to discuss economic tensions
CNN Money
BEIJING (CNN) -- U.S. Treasury Secretary Timothy Geithner met China's Vice-Premier Wang Qishan on Sunday and "exchanged views" about economic relations between their countries, both sides said.
The meeting came shortly after Geithner publicly hammered China over its currency, which Washington says Beijing keeps at artificially low levels to boost exports.
Geithner had urged the world's leading finance ministers to take strong action to ensure emerging markets nations allow their currency to rise in value in line with the free market.
Geithner Expects China to 'Continue to Move' on Yuan
By Rebecca Christie and Peter Cook
Oct. 25 (Bloomberg) -- U.S. Treasury Secretary Timothy F. Geithner expects China will allow the yuan to strengthen because officials there understand it's in the interest both of domestic growth and global economic stability.
"They recognize it's important to the world," Geithner said in an interview on Oct. 23 with Bloomberg Television, after a meeting of finance ministers and central bankers in Gyeongju, South Korea. As China's currency stance affects more countries, "China recognizes that, and I think we're going to see them continue to move."
The Liars And Thieves Are Moving Ahead In This Country
By Michael Panzner - DailyMarkets.com
I've lived though more than five decades thinking that people are basically decent but after all that has happened and the many facts that have come to light in recent years, I guess I'm pretty naive.
Indeed, a post by Charles Hugh Smith, author of Survival+: Structuring Prosperity for Yourself and the Nation and publisher of the Of Two Minds blog, entitled "The Rot Within: Our Culture of Financial Fraud and the Anger of the Honest," features commentary by an accountant with decades of experience in high-level global consulting firms and Fortune 50 U.S. corporations that suggests things have truly reached a low point.
FDIC Called On To Put Bank Of America Into Receivership
By Dan Froomkin - HuffingtonPost.com
Charging that the ongoing foreclosure fraud epidemic is the work of precisely the same unrepentant bank officers whose fraudulent mortgage schemes crashed the financial system in the first place, two leading critics of the financial industry are calling on the FDIC to put some of the nation's biggest banks into receivership -- starting with the Bank of America -- and make them clean house.
William K. Black, a former regulator and white-collar crime expert who cracked down on massive fraud during the savings and loan scandal of the 1980s, and his fellow economics professor at the University of Missouri-Kansas City, L. Randall Wray, write in the Huffington Post that it's time to "foreclose on the foreclosure fraudsters". They write:
The lenders, officers, and professional that directed, participated in, and profited from the fraudulent loans and securities should be prevented from causing further damage to the victims of their frauds, through fraudulent foreclosures.
Default or Hyperinflation: The US's Only Two Options
By: Richard Daughty - GoldSeek.com
I thought I had seen and heard it all after the ludicrous Ben Bernanke, asinine chairman of the Federal Reserve, announced that the official (and thus a lie!) 2% inflation in prices was too, too low, and he wanted higher inflation because, somehow, in some weird little fantasy world that only he and other neo-Keynesian econometric cyber-nerds can see, higher inflation is "consistent with the mandate of the Fed" to achieve stable prices (zero inflation)! Hahahaha!
This is so bizarre that I had a hard time dealing with it, as I have enough problems of my own in distinguishing reality from my own weird little mental world without this dimwit forcing his schizophrenia on me.
So I cleverly doubled up on some of my medications, which didn't help much, although I finally did relax enough to unclench one fist.
Middle-class? Entrepreneurs? Long Gone!
J. Speer-Williams - PPJ Gazette
With the US family farmer, the Banking Cartel called in their equipment loans and farm mortgages, while they had their Dept. of Agriculture pull their price supports on commodities, like milk. I know how this scam was pulled off, as I owned a small dairy farm at that time.
Like swans of legend, our once esteemed American entrepreneurs sing their final, beautiful Swan Song before they just fade away, thus tearing open the heart of our country.
Our unsung entrepreneurial heroes of America are no longer part of the national discourse, even though they were the ones who built our affluent middle-class, and helped so many of us to achieve the great American Dream.
Without a return of our small business owners and family farmers, the American Dream will be forever lost.
Entrepreneurs started and finished things, things that built an affluent and viable middle-class society, something the world has seen very little of.
Obama Undermines Hard Work and People Who Play By The Rules
Austin Hill - townHall.com
Profits at many American corporations are looking pretty good these days, yet companies aren't hiring.
Many American banks are flush with cash, yet they aren't making many loans.
And despite President Obama's repeated promises that his "healthcare reform" legislation would "lower the cost of healthcare," many health insurance providers are raising the premiums they charge their customers (some by as much as forty percent) as the new law is phased-in.
So why, after nearly twenty-two months of President Obama "gettin' people some help" (his folksy way of describing his interventions into the private sector economy), is the economy at a standstill, and in some instances getting worse?
U.S. Financial Markets: The Well Has Been Poisoned (Anger of the Honest Part II)
By Charles Hugh Smith - OfTwoMinds.com
When financial markets have become riddled with fraud, embezzlement and corruption that goes unpunished, then institutional players will avoid that market as crooked: the well has been poisoned.
The full consequences of what I termed The Rot Within: Our Culture of Financial Fraud and the Anger of the Honest (October 15, 2010) are now unfolding: the well has been poisoned. One of my most astute correspondents made a critical observation that I've seen nowhere else: once a market has been poisoned by fraud which goes unpunished, then institutional players will avoid that market as untrustworthy.
Retired and broke: Why retirees are declaring bankruptcy
Reuters.com
For more and more seniors, retirement doesn't mean a debt-free life of leisure. An increasing number of Americans aged 65 and older are declaring bankruptcy, according to a recent study by John Pottow, professor of law at the University of Michigan Law School.
Those aged 65 and older represented seven percent of bankruptcy filers in 2007, a mind-boggling jump from 1991. They are the "fastest-growing age demographic," according to Pottow's study.
DXZ Flash Crash Detonates Entire Currency Complex
by Tyler Durden - ZeroHedge.com
And now, for that Friday night bomb, when nuking stocks has a tad too much of a Waddell and Reed 'amateur hour' aftertaste, the only alternative - destroy the entire currency market. If this crash in the DXY (seen below) had happened during regular hours, apparently driven not by the dollar but by DXY component EUR (there was no comparable move in other USD pairs), it would have created a complete market collapse. Luckily it happened an hour after close. Weekend collapse averted. And a quick glance at the other pairs shows that the GBP and CHF were solidly impacted as well.
Gold Advances as Dollar's Decline Spurs Demand for Alternative
By Sungwoo Park
Oct. 25 (Bloomberg) -- Gold climbed, rallying from its worst weekly drop since July, as a weakening dollar increased investor demand for precious metals as an alternative investment. Silver and platinum gained.
Gold for immediate-delivery increased 0.7 percent to $1,337.45 an ounce at 10:34 a.m. in Seoul. The metal retreated 2.9 percent last week, the biggest weekly loss since the period ended July 2. Futures for December delivery climbed 0.9 percent to $1,337.50 an ounce on the Comex in New York.
Dollar-Neutral Gold Can't Be Ignored
By ADAM HAMILTON - FuturesMag.com
Gold has enjoyed a relentless and rather one-sided rally since late July. Up 18.9% at best over an 11-week span where nearly two-thirds of the trading days enjoyed gains, some traders are wondering if this metal is getting overbought. Tuesday's sharp 2.9% retreat certainly amplified these fears. But interestingly, due to dollar distortion this recent gold rally isn't as strong as it appears.
The benchmark US Dollar Index, which tracks the value of the US dollar relative to 6 other major currencies, has been decaying rapidly since late August. Topping the day before the flagship S&P 500 stock index (SPX) bottomed, the USDX had sunk 8.0% at worst last week by the same day gold hit its latest interim high. Over this exact 7-week span, gold rallied 11.3%. But the weak dollar was responsible for the great majority of gold's strength.
The US Dollar is Doomed
By Puru Saxena - TheDailyReckoning.com
10/22/10 Hong Kong, China - Austerity be damned, at this rate Mr. Bernanke will go down in the history books as one of the greatest money creators ever to have walked this planet!
Never mind sky-high deficits and a crushing debt overhang, at its most recent FOMC meeting, the Federal Reserve all but guaranteed another round of quantitative easing.
While the American central bank did not officially expand its quantitative easing program last month, it did reiterate its willingness to institute more aggressive monetary policy measures in order to combat the risks of deflation. Furthermore, Mr. Bernanke did officially downgrade the Federal Reserve's outlook for inflation.
Capital Controls or Chaos?
By: Julian D. W. Phillips - GoldSeek.com
G-20 meeting and Surplus limits
Gold dropped to $1,314.5 before recovering to $1.325. It seems that this was due to the G-20 proposals from the U.S. indicating a possible attempt at calming currency markets. This weekend the G-20 is meeting to discuss the current currency turmoil in the markets. Usually this is a meeting where little happens, but this time the U.S. has proposed that countries in the Group of 20 limit current-account surpluses or deficits to no more than 4% of each nation's gross domestic product by 2015. It met opposition from Japan and some developing economies. Diplomatically Japan said, "We said that we doubt whether rigid numerical targets should be set, but when checking the progress in rectifying imbalances, that might be an idea." This is a suggestion that will directly benefit the U.S. if it means that emerging nations accept that their exchange rates will rise even more. We doubt that that will be acceptable unless Capital Controls are imposed by countries whose exchange rate is already hurting. If they are imposed these will change capital flows significantly. But they would have to be draconian to succeed!
G20 Gold Convertable, Be Careful What Geithner Wishes For...
By: Adrian Ash - MarketOracle.co.uk
IT'S FIVE YEARS and $1.7 trillion of Chinese foreign reserves since the People's Bank of China ended its decade-long peg to the Dollar - the one at CNY8.3 which it had defended through the late '90s Asian Crisis and again as the Dollar first began its long decline in the early Noughties.
Back then however, as today, China refused to even begin make the Yuan freely convertible - and thus accessible to foreign investment - but for very different reasons. The fear in 2005 was of foreign speculators driving the Yuan lower. Whereas in 2010, it's got the opposite problem.
The Gold And Great Depression Myth
By PAUL MLADJENOVIC - FuturesMag.com
.... The Gold standard had nothing to do with creating the Great Depression. Absolutely nothing!
Blaming the gold standard for the Great Depression would be like blaming a seat belt for a multi-car crash. It defies common sense and logic.
In fact, had the federal government adhered to a gold standard, it would have curtailed the dangerous over-production of fiat currency. Remember that the first event of the Great Depression was the collapse of the stock market in 1929. This event was largely due to the government's reckless creation of easy credit and a currency bubble (sound familiar?). If America's central bank, "the Fed", was constrained by a gold standard, a bubble would not have been created in the first place. A gold standard puts a "straight jacked" on reckless currency inflation.
Hold on to Gold,
U.S. Government and Banks are Lying on Unemployment and Mortgage Fraud
By: The Gold Report - MarketOracle.co.uk
Predicting ongoing waves of mortgage delinquency, illiquidity and bank insolvency, 321gold's Bob Moriarty envisions a temporary financial holiday followed by a return to the gold standard. While he finds several solid investment opportunities among mining equities, he says the safest strategy is having "a $20 U.S. gold piece in your right hand and a 1 oz. gold bar in your left." In this exclusive interview with The Gold Report, Bob explains how the U.S. government "is lying" about unemployment figures and banks "are lying" about supposed mortgage reviews that find no fraud involved and recommends investors have "a triangle of investments"-the most important of which are physical precious metals.
Gold at Foothills of a Mania
By: Jeff Berwick - GoldSeek.com
The connotation of "foothills" is a perfect way of stating precisely where we are at in the collapse of the US Dollar based global financial system and the return of the king, gold, as money. It is perfect because while we are certainly seeing a movement towards a mania, with gold hitting fresh all-time highs in US Dollar terms on almost a daily basis throughout September and much of October, we are still far from reaching the top of the mountain.
We have begun a) to enter into the mania stage but b) we are still a long away from reaching its peak. Here are arguments and proof for both statements.
'Difficult to forecast price of gold in dollars'
CommodityOnline.com
Predicting ongoing waves of mortgage delinquency, illiquidity and bank insolvency, 321gold's Bob Moriarty envisions a temporary financial holiday followed by a return to the gold standard. While he finds several solid investment opportunities among mining equities, he says the safest strategy is having "a $20 U.S. gold piece in your right hand and a 1 oz. gold bar in your left." In this exclusive interview with The Gold Report, Bob explains how the U.S. government "is lying" about unemployment figures and banks "are lying" about supposed mortgage reviews that find no fraud involved and recommends investors have "a triangle of investments"-the most important of which are physical precious metals.
Correcting
By Warren Bevan - GoldSeek.com
The G20 meetings this weekend seem to have ended as they began. The two heavyweights are China and the US. The US says that China must let it's currency appreciate since they have such a large external surplus.
But why should China let it's currency rise?
They didn't create all these dollars that in turn are forcing other currencies to fall in value, nor did they directly force the US to incur such a deficit.
The fact is the US has already massive and still growing unfunded liabilities that it simply cannot fund in any way shape or form except by devaluing the home currency which unfortunately at the time was the major global unit of trade.
Got physical Gold and Silver yet?
Gold to watch Dollar, G-20 outcome
By Debbie Carlson of Kitco News - CommodityOnline.com
(Kitco News) - For the first time in six weeks, gold posted a lower weekly close, pressured by the strengthening dollar, and the dollar's direction will guide the metal's way again next week.
As gold posted its lower close weekly in a month and a half, the dollar posted its first weekly rise in that timeframe, showing the strong divergence between the two.
December gold on the Comex division of the New York Mercantile exchange settled at $1,325.10 an ounce, up/down 3.8% on the week. December silver ended at $23.118 an ounce, up/down 4.8% on the week.
Shining Silver could hit $100
By Allen Sykora of Kitco News - CommodityOnline.com
Spokane (Kitco News) -- Most of the analysts attending the Silver Summit in Spokane, Wash., described themselves as bullish on silver's long-term outlook. Following is a sampling of views.
Silver should consolidate during the rest of the year, although he described himself as bullish for the long term.
"We went from $19 to very close to $25.ÉI do believe the market has gotten a little heated on a temporary basis."
Profit-taking could set in, perhaps taking silver back to the $21-$20 area, he said. Still, he does not see a change in the fundamentals and said $30 is "achievable" next year, as silver re-establishes itself as a monetary metal in addition to an industrial metal.
U.S. Prevails in Trade Dispute With China
By SEWELL CHAN - NYTimes.com
WASHINGTON - The United States claimed victory Friday in a trade dispute with China, after a World Trade Organization panel largely upheld tariffs that were imposed on an array of Chinese-made steel pipes, tires and other products during the Bush administration.
China had used a number of technical arguments in a September 2008 challenge to antidumping duties, which are supposed to compensate for unfair pricing and countervailing duties that are used to offset improper government subsidies. But a W.T.O. dispute settlement panel rejected most of those arguments.
I.M.F. Gains Sway, but Its Authority Is Uncertain
By SEWELL CHAN NYTimes.com
WASHINGTON - Can the International Monetary Fund achieve what seems like a mission impossible: bridge the increasingly tense currency and trade disputes that threaten to set back the uneven global recovery?
That is what leaders of the world's largest countries are hoping, even though a number of international economists are skeptical.
A weekend gathering in South Korea of officials from the Group of 20 economic powers ended Saturday with a collective vow to avoid a foreign-exchange war. But they failed to agree on an American proposal to set a numerical limit on the trade imbalances that have been identified as a source of global economic instability.
Geithner Pushes for Cap on Current Account Surpluses
In all honesty, the news report out of the G20 strikes me as such a weird idea that I don't know what to make of it. From the Financial Times:
During an all-night meeting in South Korea of finance ministers from the G20 group of countries, the US called on nations to cap current account surpluses at an unspecified share of national income, a new tactic to encourage faster appreciation in the Chinese renminbi.
Ahead of the meeting, the plan was criticised by Japan and Germany, with China yet formally to respond. But US officials claimed on Saturday that the plan was making progress during the talks.
The Subprime Debacle, Part 2: New Testimony Reveals Citigroup Knew Exactly What Crap It Was Selling - By John Mauldin - BusinessInsider.com
At the end of last week's letter on the whole mortgage foreclosure mess, I wrote:
"All those subprime and Alt-A mortgages written in the middle of the last decade? They were packaged and sold in securities. They have had huge losses. But those securities had representations and warranties about what was in them. And guess what, the investment banks may have stretched credibility about those warranties. There is the real probability that the investment banks that sold them are going to have to buy them back. We are talking the potential for multiple hundreds of billions of dollars in losses that will have to be eaten by the large investment banks. We will get into details, but it could create the potential for some banks to have real problems."
Economist Joseph Stiglitz: Put Corporate Criminals in Jail
By SAM GUSTIN - DailyFinance.com
An institutionalized system of skewed incentives allowed Wall Street bankers and other corporate executives to gamble with America's wealth and then get away largely scot-free after the house of cards came tumbling down, plunging the U.S. into the worst economic crisis in decades and destroying trillions of dollars of wealth worldwide.
That's the analysis of Joseph Stiglitz, an internationally renowned economist and winner of the 2001 Nobel Prize in economics.
Home price drop sudden and dramatic
by KERRY CURRY - HousingWire.com
Clear Capital said a 6%, two-month decline in home prices represents a magnitude and speed not seen since March 2009.
"Clear Capital's latest data through Oct. 22 shows even more pronounced price declines than our most recent (Home Data Index) market report released two weeks ago," said Alex Villacorta, senior statistician with data analytics firm. "At the national level, home prices are clearly experiencing a dramatic drop from the tax credit-induced highs, effectively wiping out all of the gains obtained during the flurry of activity just preceding the tax credit expiration."
Prices are now at the same level as in mid-April, two weeks prior to the expiration of the federal homebuyer tax credit. The drop, in advance of typical winter housing market slowdowns, paints an ominous picture that will likely show up in other housing indices in the coming months.
Gary Shilling On Why Underwater Homeowners Will Double From 23% to 40% Shortly
by Tyler Durden - ZeroHedge.com
Arguably nothing can ever be quite as amusing as the Michael Pento-Simon Hobbs incident from July in which the now brainwashed Brit told the recent EuroPac addition that he was just "peddling the power of nightmares" (not even Pento getting booted off by Erin Burnett, although the fact that some idiot uttered the now legendary phrase "nothing is in a bubble when people want to buy it" certainly gives the clip brownie points for retention in the annals of CNBC's worst all time bloopers) when all the outspoken critic of the Fed said was the truth. Alas, today's interview of Gary Schilling by the same British H1-B/Green card holder comes nowhere close, however it certainly should be highlighted. Following up on Diana Olick's presentation of Clear Capital surprising announcement that home prices had dipped 6% in just two months (we can't wait for Cramer's take on this development even as housing "bottomed" last June), and warning that fraudclosure will certainly cause prices to dip even more, it is Gary's turn to "peddle some nightmare powers" to Hobbs. To wit: the CEO of Gary Shilling & Co. sees home prices tumbling another 20% over the next few years, and the number of underwater mortgages nearly doubling from 23% to 40% (meaning nearly half of America will likely strategically default as nobody has any initiative to pay down their mortgage when they know there is no equity value left).
So Much For Bank Claims That Nothing is Wrong with Foreclosures: 4450 Foreclosures Halted In NYC Due to Inaccuracies
NakedCapitalism.com
After the dramatic multi-state foreclosure halts by three major servicers, GMAC, Bank of America, and JP Morgan, over the use of improper, "robo signed" affidavits, the new party line from these banks and others who also used robo signers, like Wells Fargo, is that this was a mere "technical" problem, that they had reviewed ten of thousands of pending foreclosures and claimed the underlying information and processes were sound.
Owners Seek to Sell at a Loss, but Bankers Push Foreclosure
By MICHAEL POWELL - NYTimes.com
PHOENIX - Bank of America and GMAC are firing up their formidable foreclosure machines again today, after a brief pause.
But hard-pressed homeowners like Lydia Sweetland are asking why lenders often balk at a less disruptive solution: short sales, which allow owners to sell deeply devalued homes for less than what remains on their mortgage.
Ms. Sweetland, 47, tried such a sale this summer out of desperation. She had lost her high-paying job and drained her once-flush retirement savings, and her bank, GMAC, wouldn't modify her mortgage. After seven months of being unable to pay her mortgage, she decided that a short sale would give her more time to move out of her Phoenix home and damage her credit rating less than a foreclosure.
Lawsuit Alleges that MERS Owes California a Potential $60-120 Billion in Unpaid Land-Recording Fees
by George Washington - ZeroHedge.com
Former hedge fund manager Shah Gilani notes:
In creating MERS, these institutions actually changed the land-title system that this country - for much of its history - has relied upon to determine legal ownership status of land titleholders.
Not only did the lenders sidestep (read that to mean avoid) paying billions of dollars in fees to local governments, they paid themselves from the fees that MERS collected.
New York Fed Faces 'Conflict' in Mortgage Buybacks
By Caroline Salas and Jody Shenn
Oct. 21 (Bloomberg) -- The Federal Reserve Bank of New York's effort to recover taxpayer money used in bailouts during the crisis may be at odds with its mission to ensure the stability of the financial system.
The New York Fed, which acquired mortgage debt in the 2008 rescues of Bear Stearns Cos. and American International Group Inc., joined a bondholder group including Pacific Investment Management Co. that aims to force Bank of America Corp. to buy back some bad home loans packaged into $47 billion of securities, people familiar with the matter said this week.
Foreclosure Mills in Florida Slipping the Net of Attorney General Investigation
NakedCapitalism.com
I hope readers will forgive the overweight reporting on Florida, but it is serving as a test ground for how battles over foreclosures and mortgage fraud will play out around the US. Florida is not only one of the states with the highest level of foreclosures, but it also has the most cohesive group of anti-foreclosure lawyers, as well as more intensive reporting of developments within the state, thanks to sites like 4ClosureFraud.org and ForeclosureHamlet.org. So in many respects, this conflict is more advanced in Florida than in other states.
Here's Why Massive Mortgage Write-Offs Could Be The Only Way To Save Iceland's Middle Class
Dian L. Chu - BusinessInsider.com
The Icelandic financial crisis has been ongoing since 2008 when all three of the country's major commercial banks collapsed after they failed to refinancing their short-term debt and a run on deposits in the U.K.
In July, I talked about how Iceland is totally not a post-crisis miracle as Paul Krugman claims, but just how are things now with Land of Fire and Ice?
Some of the scary economic figures, courtesy primarily of the plunging Icelandic kr—na:
Inflation has soared 41 percent from January 2007 through September this year
Real disposable incomes slumped 20.3 percent last year
Real wages fell 10.1 percent from the beginning of 2007 through August this year
63 percent of the nation's mortgage is underwater
40 percent of homeowners are "technically insolvent"
Hiring part-time workers can have side effects Small businesses often lack the human resource expertise needed to follow the myriad rules and requirements that come with having even one employee who isn't full-time.
By Cyndia Zwahlen - LATimes.com
Hiring a part-time worker can be a money saver for a small business, whether the company is growing or shrinking, but experts warn that the choice comes with possible side effects.
An unwary business could wind up facing an expensive legal battle if it runs afoul of federal or state labor laws, which generally apply to part-timers as well as full-time workers.
"I am getting more calls from small-business owners who are getting hauled into court or being audited by some agency because they are being accused of violating laws they didn't even know applied to them," said Teresa Tracy, a labor attorney in Marina del Rey.
Unemployment in Some States Near Record Highs
By DOUGLAS MCINTYRE - DailyFinance.com
The Bureau of Labor Statistics has released data on regional and state unemployment for September. Jobless rates remain uneven. Nevada's unemployment rate hit another high, and Michigan remained in second place. Plains states, including the Dakotas and Nebraska, had rates under 5%.
"Twenty-three states and the District of Columbia recorded unemployment rate decreases, 11 states registered rate increases, and 16 states had no rate change", the U.S. Bureau of Labor Statistics said as it compared numbers to August figures. "Twenty-nine states and the District of Columbia posted unemployment rate decreases from a year earlier, 16 states reported increases, and 5 states had no change."
Employers looking at health insurance options
APNews - Townhall.com
The new health care law wasn't supposed to undercut employer plans that have provided most people in the U.S. with coverage for generations.
But last week a leading manufacturer told workers their costs will jump partly because of the law. Also, a Democratic governor laid out a scheme for employers to get out of health care by shifting workers into taxpayer-subsidized insurance markets that open in 2014.
While it's too early to proclaim the demise of job-based coverage, corporate number crunchers are looking at options that could lead to major changes. Gov. Phil Bredesen, D-Tenn., said the economics of dropping coverage are "about to become very attractive to many employers, both public and private."
That's just not going to happen, White House officials say.
Oil and Empire: The Great Game of Geopolitics
Written by Charles Hugh Smith - OilPrice.com
The Great Game is afoot and no matter how we may disapprove of the Global Empire, we would be wise not to discount the cards it alone holds.
Geopolitics is not called The Great Game without reason. The game of dominating the world's resources, nation-states and alliances is like a combination of Go and chess, with the threat of military conquest or defeat always hovering over the statecraft and financial game.
I am going to present a number of statements and speculations here, most of which are at odds with the status quo thinking. I present them not to be contrarian but because they seem self-evident.
Is Fusion Power Closer to Becoming Reality
Written by David Gabel - OilPrice.com
It has been called the holy grail of energy technology; a perfectly clean source with an unlimited supply. Nuclear fusion has been demonstrated to be possible, but converting it to a viable energy source remains technically elusive. However, research on making fusion energy reality is in progress, and there are some who are convinced that the day will come when this free and abundant source will arrive.
Our current nuclear technology, fission, is the breaking of the atomic nucleus, which releases massive amounts of energy. For a fusion reaction, the nuclei of two atoms fuse together to form a heavier nucleus. The resulting release of energy is incredibly large. To put it in perspective, fusion is the power of the sun, a force strong enough to heat a planet that is 93 million miles away.
Duane Hammond Fired for Wearing Bush Sweatshirt at Obama Rally in Los Angeles - FireAndreaMitchell.com
Tell me again, who are the so called "extremists"? Ah yes. More wonderful progressive liberal Democrat union thugs at work. Duane Hammond is or was a union stagehand who was part of the crew that built the platform for the Obama event on campus of USC according to KTLA. Hammond has a son in the Navy. His son is currently serving on the aircraft carrier U.S.S. George H. W. Bush. So Duane Hammond was wearing a sweatshirt and hat that he received during a visit to the aircraft carrier on Family Day. It wasn't one of those George W. Bush "Miss Me Yet" shirts, or anything making a political statement. Yet, wearing attire to pay tribute to your son is a fireable offense for progressive liberal union thugs.
Republican congressional candidate says violent overthrow of government is 'on the table'
By MELANIE MASON / The Dallas Morning News
WASHINGTON - Republican congressional candidate Stephen Broden stunned his party Thursday, saying he would not rule out violent overthrow of the government if elections did not produce a change in leadership.
In a rambling exchange during a TV interview, Broden, a South Dallas pastor, said a violent uprising "is not the first option," but it is "on the table." That drew a quick denunciation from the head of the Dallas County GOP, who called the remarks "inappropriate."
Broden, a first-time candidate, is challenging veteran incumbent Rep. Eddie Bernice Johnson in Dallas' heavily Democratic 30th Congressional District. Johnson's campaign declined to comment on Broden.
In the interview, Brad Watson, political reporter for WFAA-TV (Channel 8), asked Broden about a tea party event last year in Fort Worth in which he described the nation's government as tyrannical.
"We have a constitutional remedy," Broden said then. "And the Framers say if that don't work, revolution."
Death toll rises in Mexican border city shooting
By the CNN Wire Staff
(CNN) -- The death toll from a shooting at a house party in the violence-plagued Mexican border city of Juarez has climbed to 14, state media reported Sunday.
Chihuahua State Attorney General Carlos Manuel Salas told reporters that another 14 people were injured when gunmen attacked the gathering of young people at a house party Friday, the state-run Notimex news agency reported.
The victims killed were between ages 14 and 30, Notimex said. Children as young as 7 and 11 were among the injured, the agency reported.
Power Shifting from West to Asia and Latin America
Written by Hee En Ming - OilPrice.com
In Asia, it's a truism that, as Chairman Mao put it, "the wind comes from the East", at least as far as the world economy is concerned.
But what was so shocking about the most recent IMF meeting in Washington was the extent to which Western leaders now openly acknowledge the same reality - not just about the present, but well into the future as well.
While that recognition is positive on the analytical level, it remains unclear, as this piece points out, how they are going to deal with this new situation - both as a "group" of some sort, and as individual countries.
Unemployment and Consumer Debt: The 800 lb Gorilla in the Room
By Mike Meyer - The DailyReckoning.com
10/21/10 St. Louis, Missouri - When I left you Tuesday morning, the currencies were hanging on, but as Chuck explained yesterday, we saw a considerable sell-off in response to the rate increase from China as the day wore on. The euro (EUR) had briefly dipped into the 1.36 handle and the dollar index rallied the most in two months. It looks as though this was just a knee-jerk reaction as we opened yesterday morning with the euro in the mid 1.38 handle and rose all the way up to 1.3991. It was as if Tuesday was gone with the wind, like it never happened.
I can hear you asking yourself, "What's the deal?"... Why did the currencies snap right back into place like a rubber band? Well that tug of war I was talking about between the two quantitative easing camps pulled back the other way and traders became focused on the Fed's Beige Book. There was another economic firm that came out and said the magnitude of QE will be more than what is currently expected so that sent the dollar bulls back into time out, at least for now.
Is Debt a New Form of Slavery?
By MATTHEW SCOTT - DailyFinance.com
Can the black church help African Americans overcome the disproportionately negative impact they've experienced in unemployment, income growth, home ownership, foreclosures and educational attainment during the recent economic crisis? That's the critical question explored in the 90-minute documentary, "Almighty Debt," hosted by Soledad O'Brien on CNN Thursday.
The latest in O'Brien's Black In America series looks at how black churches are combating the challenges caused by excessive debt and the erosion of wealth in the African American community. O'Brien focuses on the efforts of the Reverend DeForest Soaries, who has created a program designed to liberate the 7,000-member congregation of First Baptist Church of Lincoln Gardens, N.J., from debt. Soaries, who has also been involved with many civil rights efforts, calls debt "the new slavery."
Public-Sector Unions Choke Taxpayers
By John Stossel - PatriotPost.us
"I thought unions were great -- until at Chrysler, the union steward started screaming at me. Working at an unhurried pace, I'd exceeded 'production' for that job."
That comment, left on my blog by a viewer who watched my Fox Business Network show about unions, matches my experience. No one ordered me to slow down, but union rules and union culture at ABC and CBS slowed the work. Sometimes a camera crew took five minutes just to get out of the car.
Now unions conspire with politicians to rip off taxpayers.
Steve Melanga of the Manhattan Institute complains that politicians get union political support by granting government workers generous pensions and health benefits. After those politicians leave office, taxpayers are liable for trillions in unfunded promises.
Peter Schiff on The Keiser Report October 21, 2010
An "In Your Face" Entitlement - FERS
Submitted by Bruce Krasting - ZeroHedge.com
I don't think there is anyone who looks at the issue of entitlements in the US who is not gravely concerned about the direction we are on. Economists of all stripes, damn near everyone in D.C. and a long list of academics have all highlighted the problems. But the same groups that are raising red flags are misleading us on when and how this problem will affect us.They say/think it is a tomorrow problem. Actually it is hitting us today.
I want to focus on the Federal Employees Retirement System ("FERS"). This is a retirement program for federal workers. The program is similar to Social Security in a number of ways.
FERS collects money from government workers and their employer.
The program pays benefits to eligible workers and their families.
FERS has a trust fund.
FERS is running a cash flow deficit.
Google 2.4% Rate Shows How $60 Billion Is Lost to Tax Loopholes
By Jesse Drucker
Oct. 21 (Bloomberg) -- Google Inc. cut its taxes by $3.1 billion in the last three years using a technique that moves most of its foreign profits through Ireland and the Netherlands to Bermuda.
Google's income shifting -- involving strategies known to lawyers as the "Double Irish" and the "Dutch Sandwich" -- helped reduce its overseas tax rate to 2.4 percent, the lowest of the top five U.S. technology companies by market capitalization, according to regulatory filings in six countries.
Small firms not thrilled with big banks
By Catherine Clifford
NEW YORK (CNNMoney.com) -- Small business owners are less than pleased with their relationships with their banks, especially big banks, according to a study from consumer satisfaction research firm, J.D. Power and Associates.
Main Street businesses' overall satisfaction with and loyalty to their banks is declining, according to the U.S. Small Business Banking Satisfaction Study released Thursday. Satisfaction is now at 711 on a 1,000-point scale, down from 718 in 2009. What's more, small businesses are the least satisfied of the financial services customers J.D. Power surveyed.
Markets, China rate hike, gold, Geithner, Fisher, France
Creeping Inflation Reveals Recession's Trapdoor
By Rocky Vega - The DailyReckoning.com
10/21/10 Stockholm, Sweden - As the Fed's stated intention to execute QE2 lurks ever closer - plans to resume asset purchases, including Treasuries, are slated for the November 2nd FMOC meeting - even a few more than average regional Fed bank presidents are breaking rank.
According to Bloomberg, Philadelphia president Charles Plosser said unemployment is a "terrible problem," but he flat out prefers it "to monetary-policy solutions at this point," that increase inflation. Even more plainly, he said, "I am less inclined to want to follow a policy that is highly concentrated on raising inflation and raising inflation expectations."
The US Dollar Is Doomed
GoldSeek.com
Austerity be damned, at this rate Mr. Bernanke will go down in the history books as one of the greatest money creators ever to have walked this planet!
Never mind sky-high deficits and a crushing debt overhang, at its most recent FOMC meeting, the Federal Reserve all but guaranteed another round of quantitative easing.
While the American central bank did not officially expand its quantitative easing program last month, it did reiterate its willingness to institute more aggressive monetary policy measures in order to combat the risks of deflation. Furthermore, Mr. Bernanke did officially downgrade the Federal Reserve's outlook for inflation.
The truth is that the US is insolvent and its policymakers will stop at nothing in order to avoid sovereign default. So, it should come as no surprise that at its latest meeting, the Federal Reserve downplayed the risk of inflation, thereby setting the stage for another round of money creation.
Falling Dollar Means Rapid Consumer Price Inflation
By Daniel R. Amerman, CFA - GoldSeek.com
Finally and with the greatest of reluctance - the US government has begun the defense of the US economy. This essential and long overdue defense is likely to be extremely painful for US investors, precisely because it is so long overdue. To return strength to a US economy mired in growthless depression requires an extraordinary action - the Federal Reserve and US government are openly going after the value of the US dollar. For the minority of the US population who are aware of and following these developments, the "headline" attack on the US dollar is the Federal Reserve's imminent likely return to quantitative easing. The current discussion is that this will take the form of the Fed creating money out of thin air to fund US government budget deficits through the direct purchase of government bonds. No more pretenses, but openly getting down to the ugly business of outright monetization on a massive scale. This strategy aims to deliberately knock the dollar off its pedestal in the short term, and possibly ends the dollar's status as a global reserve currency in the longer term.
Will the US Treasury Defend the US-Dollar?
By Gary Dorsch - GoldSeek.com
"Everything depends on proper listening. Of ten people who listen to the same speech or story, each person may well understand it differently. Perhaps, only one of them will understand it correctly." How should traders interpret the latest remarks by US Treasury chief Timothy Geithner, who shocked the currency markets on October 18th, citing his determination to defend the value of the US-dollar?
Geithner was asked in a question and answer forum, "Are you concerned with all of the money being printed over the last couple of years? Are we on our way to debasing the value of the dollar?" Geithner surprised his audience with a passionate defense of the US-dollar. "Not going to happen in this country. It is very important for people to understand that the United States of America and no country around the world can devalue its way to prosperity and competitiveness," he said.
Weaker US Dollar not fueling Gold's rally: Gartman
By Daniela Cambone of Kitco News
(Kitco News) - Gold's rally isn't just based on a weaker U.S. dollar but is being driven by the fact that every nation in the world is looking to have its currency devalued, said Dennis Gartman, editor of the Gartman Letter.
"I find it amusing that people are telling me gold is going up because the dollar is weak when gold is going up in dollar terms, gold is going up in euro terms, gold is going up in sterling terms and the Japanese would love to see gold go up in Japanese yen terms. Gold is even going up in Chinese renminbi terms, so there is something here besides a knee-jerk response by a weak dollar," he said.
Silver fever grips investors
LONDON (Commodity Online): Silver, the shining start among precious metals, has already set a 30-year record and the silver exchange traded funds (ETFs) also posted big gains in the recent past.
To add to that, silver prices could go even higher than what they are now. Primarily driving the price now is safe-haven buying, driven by beliefs that governments around the world will enact more stimulus and weaken their currencies. There also may be less of the metal to go around here, too.
Silver exports from China, the world's largest, may drop about 40% this year as domestic demand from industry and investors climbs.
Doubling the Value of Silver
By: Richard Daughty - SilverSeek.com
With gold and silver going up in price like they are, I spend a lot of time secluded in the Big Mogambo Bunker (BMB), greedily calculating my profit with each little up-tick in price. I am so delighted that I alternate between, on the one hand, happily dreaming of happier days to come when silver and gold have gone up so much in the roaring inflation caused by the Federal Reserve creating so much money that I will have made So Freaking Much Money (SFMM), then, on alternatively, dreading the hyperinflation caused by the Federal Reserve creating so much extra money that it causes societal breakdown in a bleak and horrific post-apocalyptic nightmare of worthless dollars, violent clan rivalries, bloody warlords and weird alien invaders from some distant planet planting spores in our brains.
Obama pushes currency accord with major nations
By Howard Schneider - Washington Post
The Obama administration is pushing major nations for a broad new agreement on fundamental economic issues such as exchange rates and trade surpluses. To succeed, however, the effort must breach a deep divide between developed and developing countries on how best to secure global economic growth.
The push was conceived largely as a new tack in a dispute over China's currency policies, but it is poised to become a defining battle for the Group of 20 major economic powers.
Geithner Said He Won't Let Dollar Fall
By Arnaldo Galvao and Iuri Dantas
Oct. 21 (Bloomberg) -- U.S. Treasury Secretary Timothy Geithner told Brazil's Finance Minister Guido Mantega yesterday that the U.S. won't allow the dollar to weaken, Mantega said.
Mantega said he and Geithner agreed to act jointly with the Group of 20 nations to find a solution for the dollar's depreciation. Geithner also said in a telephone conversation that the impact of Federal Reserve policies is being "overestimated," Mantega told reporters in Brasilia today.
Global trade wars: China turns up the heat
By Chris Isidore
NEW YORK (CNNMoney.com) -- Forget about the value of the yuan, cheap tires or chickens.
Ground zero of a possible trade war between the United States and China may be a bunch of elements on the periodic table you've never heard of and couldn't pronounce.
U.S. officials have been pushing China to allow its currency to rise against the dollar and level the international export playing field. And last month, the U.S. imposed tariffs on Chinese tires. China responded by announcing tariffs on U.S. chickens. Now, there are some indications that China may be cutting off supplies of 17 rare earth minerals to the U.S. and Europe.
Inside Job - Dylan Ratigan Interviews Director Charles Ferguson How Wall Street Took Over Government
The DailyBail.com
Why economists are part of the problem
Both Glenn Hubbard and Laura Tyson have played major roles in American economic policy, and both also, unfortunately, exemplify the disturbing, opaque conflicts of interest that pervade the economics discipline.
Over the last thirty years, academic economics has been penetrated by special interests, particularly financial services, in the same way that America's political and regulatory systems have been compromised by campaign contributions and the revolving door. In fact, the "revolving door" is now a triangular trip between industry, government, and academia. Watch the trailer here: Inside Job - How Wall Street Became A Criminal Enterprise And Took Over Government - Feature Film Trailer, Winner At Cannes 2010
Willem Buiter: The US Must Prepare For Savage Austerity
Submitted by Tyler Durden - ZeroHedge.com
In an interview with Tom Keene yesterday, Citi strategist Willem Buiter, alongside Howard Davies chairman of the London School of Economics, said that "savage austerity" is in the US' future. "The only question was really the timing and the composition." Alas, for that to happen it would require an overhaul of the entire US kleptocratic oligarchy, and the entire premise of tenured politicians, who don't realize that in addition to boosting revenues, sometimes outlays have to be trimmed as well. Of course, as this is precisely the fatal flaw of Keynesianism, we can only commiserate with Buiter, who calls it exactly right. Too bad that even the possibility of actual austerity in the US would result with riots so severe it will make the ongoing economic freeze in France seem like the peak of Chinese economic growth.
Davies Sees Fed Quantitative Easing Spurring U.S. Growth
Germany to Raise Alarm Over China Rare Earths Restrictions at G-20
By JUDY DEMPSEY - NYTimes.com
BERLIN - Stung by Chinese muscle-flexing over minerals crucial for high-technology industries, the German government said Thursday that it would raise the alarm at the Group of 20 talks, even as it looks to step up efforts to develop new supplies in Eastern Europe and Central Asia.
German companies say they are being pressed by Chinese officials to increase their investments in China if they want to be assured of access to rare earth minerals and two other obscure elements, tungsten and antimony. China dominates the mining of these metals.
MBA wants FHA to revise penalties in foreclosure timeline
by JASON PHILYAW - HousingWire.com
The Mortgage Bankers Association wants the Federal Housing Administration to revise the penalty structure for mortgage servicers who fail to begin foreclosure proceedings by the federal deadline.
MBA officials want the FHA to implement a "more equitable" penalty for missing the deadline to make it more attractive to service FHA loans.
In a letter to David Stevens, assistant secretary for housing, and commissioner of the Department of Housing and Urban Development, the MBA said servicers are already squeezed by the six-month deadline to initiate foreclosures, which has been pared down over the years from a previous deadline of 12 months.
Fannie Mae and Freddie Mac deep in the hole Republicans, Democrats agree on reform, but not on solutions
By Patrice Hill - The Washington Times
Fannie Mae and Freddie Mac are well on their way to becoming the biggest and most enduring black holes for taxpayers coming out of the 2008 financial crisis, with a new estimate of their bailout cost nearly doubling the tab to as high as $259 billion.
The estimate was released Thursday as the Treasury reported a profit of $11 billion on $308 billion of bank bailouts and raised hopes for the repayment of costly and unpopular rescues of insurance giant American International Group Inc. and Detroit automaker General Motors Co., enabling those controversies to fade more into the background.
Tab for Fannie Mae, Freddie Mac rescue could soar to $363B
By Alan Zibel, AP Real Estate Writer
WASHINGTON - Rescuing mortgage buyers Fannie Mae and Freddie Mac could cost as taxpayers as much as $363 billion over the next three years, more than double the current amount, a federal regulator said Thursday.
The two companies could end up costing taxpayers $221 billion to $363 billion through 2013, the Federal Housing Finance Agency projects. The actual amount will depend on whether home prices stabilize or take another dive, the agency said.
The two mortgage finance companies have been operating under federal control for more than two years after nearly collapsing because of the housing bust.
No Foreclosure Problems at Bank of America? Don't You Believe It
By ABIGAIL FIELD - DailyFinance.com
After a 16-day review of its foreclosures, Bank of America (BAC) has pronounced itself satisfied: It found no problems at all with any of them, and it's ready to resume processing foreclosures. The bank told The New York Times it has "not found a single example where a foreclosure proceeding was brought in error," and "We did a thorough review of the process, and we found the facts underlying the decision to foreclose have been accurate."
Let's be blunt: That's a claim so unbelievable it doesn't pass the straight-face test.
Banks Face Two-Front War on Mortgages, Foreclosures
By John Gittelsohn and Jody Shenn
Oct. 21 (Bloomberg) -- Shoddy mortgage lending has led bankers into a two-front war, pitting them against U.S. homeowners challenging the right to foreclose and mortgage-bond investors demanding refunds that could approach $200 billion.
While federal regulators and state attorneys general have focused on flawed foreclosures, a bigger threat may be the cost to buy back faulty loans that banks bundled into securities. JPMorgan Chase & Co., Bank of America Corp., Wells Fargo & Co. and Citigroup Inc. have set aside just $10 billion in reserves to cover future buybacks. Bank of America alone said this week that pending claims jumped 71 percent from a year ago to $12.9 billion of loans.
Mortgage database's murky legal status adds another wrinkle to foreclosure mess The Mortgage Electronic Registration Systems, which tracks ownership changes on millions of home loans, is accused by borrowers of wrongly filing home-seizure actions against them.
By Jim Puzzanghera, Los Angeles Times
Reporting from Washington - Major banks and mortgage lenders are coming down with another legal headache in their efforts to seize properties from homeowners in default.
A little-known electronic database formed by them 15 years ago to track ownership changes on millions of mortgages is being challenged in court by desperate borrowers alleging it wrongly filed foreclosure actions against them.
The cases against Mortgage Electronic Registration Systems Inc., known in the industry as MERS, highlight the shortcuts taken by the financial industry during the housing bubble.
pt1/2 Gerald Celente on The Financial Sense Newshour 19Oct2010
pt2/2 Gerald Celente on The Financial Sense Newshour 19Oct2010
In 15 of Last 25 Months,
Treasury Needed to Borrow Money to Pay Social Security Benefits
By Chris Johnson
(CNSNews.com) - The U.S. Treasury has needed to borrow money to pay Social Security benefits in 15 out of the last 25 months on record because the Social Security system was in deficit in those months, with the cost of monthly benefit payments exceeding the Social Security tax revenues flowing into the Old Age, Survivors and Disability Insurance "trust funds," according to data published by the Social Security Administration.
Because the overall federal budget was in deficit during this entire period, the surplus revenues Social Security earned in the remaining 10 months of the last 25 was used during those months to pay ongoing general government expenses and was not saved to pay future Social Security benefits.
The government gave the Social Security trust funds IOUs for this money.
The Government's License to Steal Indiana's law barring police departments from enriching themselves through asset forfeiture would be more effective if it weren't ignored.
By Radley Balko - Reason.com
In the late 1990s, after a public backlash against the use of civil asset forfeiture to take money and property from innocent people, seven states passed laws assigning all proceeds from such forfeitures to public schools or the general fund instead of police departments and prosecutors' offices. The idea was to reduce the incentive to seize assets from innocent owners and to target people based on the value of their property instead of the seriousness of their crimes.
In Indiana, the state's original constitution called for criminal forfeitures to be earmarked for a school fund, and recent attorneys general have applied that provision to civil forfeiture as well. But thanks to various evasive maneuvers, very little forfeiture money actually ends up in the fund.
Campaign's Big Spender Public-Employees Union Now Leads All Groups in Independent Election Outlays
By BRODY MULLINS And JOHN D. MCKINNON - WSJ.com
The American Federation of State, County and Municipal Employees is now the biggest outside spender of the 2010 elections, thanks to an 11th-hour effort to boost Democrats that has vaulted the public-sector union ahead of the U.S. Chamber of Commerce, the AFL-CIO and a flock of new Republican groups in campaign spending.
The 1.6 million-member AFSCME is spending a total of $87.5 million on the elections after tapping into a $16 million emergency account to help fortify the Democrats' hold on Congress. Last week, AFSCME dug deeper, taking out a $2 million loan to fund its push. The group is spending money on television advertisements, phone calls, campaign mailings and other political efforts, helped by a Supreme Court decision that loosened restrictions on campaign spending.
ObamaCare's Medical Loss Ratios Likely to Result in Consumer Losses
By Peter Suderman - Reason.com
What percentage of premium revenue should health insurance companies spend on clinical services? Thanks to the new health care law, that's for the federal government to decide.
That means setting rules to determine what, exactly, constitutes a "clinical service." Today, the National Association of Insurance Commissioners voted on its recommended medical loss ratio (MLR) regulation. The PPACA calls for insurers to spend either 80 or 85 of their premium revenue on clinical expenses. If insurers fail to meet the requirement, they're required to send rebates to customers. The regulation, which must still be certified by the Department of Health and Human Services before being enforceable, provides rules for how to make the calculation.
Health insurer HealthMarket
sued by L.A. city attorney over 'junk insurance' The suit also names major stakeholders Goldman Sachs Group and Blackstone Group
By Duke Helfand, Los Angeles Times
A national health insurer and its majority owners, Wall Street powerhouses Goldman Sachs Group Inc. and Blackstone Group, were accused in a lawsuit Wednesday of defrauding their California customers with "junk insurance" that provided little or no protection.
The suit filed by the Los Angeles city attorney's office alleges that HealthMarkets Inc. and its affiliates trained sales agents to deceive customers - mostly self-employed individuals and small businesses - into buying confusing policies riddled with exclusions and limitations.
It also contended that Goldman Sachs and Blackstone knew about the alleged insurance scams in California when they bought a majority stake in HealthMarkets in 2006.
Judge Andrew Napolitano:
A Return to Our Goldwater Roots - Alex Jones Tv 1/2
Judge Andrew Napolitano:
A Return to Our Goldwater Roots - Alex Jones Tv 2/2
Xerox to cut 2,500 jobs as profit doubles
NEW YORK (AP) - As it looks to wring more cost savings out of the $6 billion acquisition of ACS, Xerox said Thursday it plans to eliminate 2,500 jobs, or about 2% of its 133,000-person work force, over the next year.
The announcement came as Xerox (XRX) reported that it doubled its profit in the third quarter, helped by surging demand for its copying equipment and growth in service contract that is being fueled by its recent acquisition of Affiliated Computer Services.
Xerox reported net income of $250 million, or 17 cents a share, for the quarter, compared with $123 million, or 14 cents a share, a year ago. Excluding one-time items, adjusted income was 22 cents a share.
Find a niche for your small business and gain a competitive edge
By Rhonda Abrams, Special for USA TODAY
Years ago, I had a client who was an interior designer. When I asked which customers she was targeting, she said, "People moving from their starter homes to a bigger house, people moving from a bigger place to a smaller house, people moving into their first homes, even those moving into apartments."
"In other words," I responded, "everyone who lives indoors?" Like most small-business owners, she was making a critical, but typical, mistake - she wanted to serve everyone. After all, why not have every possible customer you can?
In fact, you can often be more successful - have more customers and charge more - if you narrow your focus. You've got to know your market, and by narrowing your market - choosing specific customer segments or niches - you make the most of your resources, and you create a clear distinction between you and your competitors.
How eBay Could Disconnect AT&T iPhones
By MARTIN PEERS -WSJ.com AT&T's executives better hope its customers never discover a little site called eBay.
Amid reports the phone firm's U.S. exclusivity agreement on Apple's iPhone is about to end, AT&T appears to be putting great stock in having locked many customers into new two-year contracts. The thinking seems to be that even if rival Verizon Wireless - a joint venture of Verizon Communications and Vodafone Group - starts offering the device soon, fewer AT&T customers will switch.
Silicon Valley 3.0: Tech's New Wave
By PUI-WING TAM And CARI TUNA - WSJ.com
SAN JOSE, Calif. - Edenvale Technology Park gives a glimpse of the new Silicon Valley.
The long recession only tiptoed through the 2,300-acre office park, with many start-ups here expanding their operations over the past 18 months. One prominent tenant, solar company Nanosolar Inc., began producing solar panels in March and plans to add space and more employees to its 350-person work force.
Scientific-equipment maker Stratedigm Inc. moved into a 6,000-square-foot space in Edenvale - more than double its old office size - as it revs up sales. And several biomedical start-ups that were started under one roof also upgraded to bigger offices in the park.
A flying Humvee? Don't scoff, Pentagon wants one Pratt & Whitney's Rocketdyne division in Canoga Park is awarded $1 million to design a propulsion system for the airborne vehicle.
By W.J. Hennigan, Los Angeles Times
With its armored doors and bulletproof windows, the burly Humvee has been a stalwart ground transport for the U.S. military.
But now the Pentagon thinks the hulking vehicle should also be able to fly.
On Tuesday, Pratt & Whitney's Rocketdyne division in Canoga Park announced that it had been awarded $1 million to design a propulsion system for a flying Humvee.
Don't scoff - there is good reason for an airborne truck, defense officials say.
Important video (58:15)... globalism and Who's who?
Biometrics (Lockheed Martin is developing ID system / BIMA Diometrics Identity Management Agency - government agency; ZyGem Transformational DNA Testing Platform; Biometric Consortium Conference - mark in right hand; Bio API Consortium; findBiometrics - Global Identity Management; Capstone Concept for Joint Operations - DOD - identify everyone for "peace & safety"; Office for Information Awareness -"Knowledge is Power" part of Homeland Security; digital Angel - marketed as "connection between you and your soul" Applied digital solutions invented the micro (RFID) chip)
Designated High-Speed Rail Corridors Map Overview: Section 1010 of the Intermodal Surface Transportation Efficiency Act of 1991 (ISTEA) established a special program to fund safety improvements at highway-rail grade crossings on corridors that were "designated" as high-speed intercity passenger rail corridors based on their present utility and their potential for future development. This grade crossing safety program is codified at 23 U.S.C. 104(d)(2).
Current Status of Designations: At present, up to eleven corridors are authorized for designation, of which the Secretary of Transportation and/or the Congress have designated the ten corridors that are shown in green on the map. A full corridor chronology is available of the designations and modifications since 1992. Of the designated corridors, three were specifically named by Congress in law. The other seven were selected by the Secretary of Transportation in a competitive process, which in current law involves an evaluation of such factors as projected ridership, public benefits, and anticipated partnership participation of States, localities, and the freight railroads.
USDOT - High Speed Rail Corridor Designationslarge MAP
Federal Railroad Administration 10/19/2005
High-Speed and Intercity Passenger Rail Vision of High-Speed Rail in America
"Imagine whisking through towns at speeds over 100 miles an hour, walking only a few steps to public transportation, and ending up just blocks from your destination. Imagine what a great project that would be to rebuild America." - President Obama announcing a new vision for high-speed and intercity passenger rail service in America (April 16, 2009)
The Administration has placed a new emphasis on building high-speed and intercity passenger rail to connect communities and economic centers across the country. A fully developed passenger rail system will complement highway, aviation and public transit systems.
Amtrak's long-term plans
Oct 2nd 2010, 16:44 by N.B. | WASHINGTON, DC
AMTRAK, America's government-run passenger rail service, has big plans. On Tuesday, the company unveiled its long-term ambitions for high-speed rail in the Northeast corridor-the megalopolis that runs from Boston to New York and then Philadelphia and Washington. Amtrak's vision includes 30 years worth of work at a cost of $117 billion, and would include trains travelling at 220mph (350kph). That would reduce travel times by more than half.
The Greater Greater Washington blog has more details on the plan, which would include a new station in Baltimore and a new, six-mile tunnel under the center of that city. The new tracks between New York and Boston would skip Fairfield County, Connecticut and Providence, Rhode Island entirely-an idea that may not be politically possible. Here's a map Amtrak put together showing the proposed route:
HSR Corridors Make Way for Future USA Travel by Train
President Barack Obama has revealed an ambitious plan to accelerate the development of U.S. high-speed rail (HSR) transportation. Designed to fast-track ten regional high-speed corridors already being planned by States, the plan targets upgrades to existing rail lines as well as new rail lines devoted to 150-250 mph/240-400 km/h trains. The plan is also expected to hasten improvements to the country's only existing high-speed corridor.
High-speed passenger trains are a green alternative for the USA's transportation future. Noting that "high-speed rail is long-overdue," President Obama characterized HSR as a clean, energy-efficient travel option that will generate both construction jobs and permanent rail jobs. When completed, the high-speed corridors will increase economic activity in destination communities and reduce dependence on high polluting highway and air transportation.
Foreign Firms Hoping to Ride US Rail Boom
By Mary Beth Warner - Spiegel.de
Siemens, Bombardier and other rail engineering firms have high hopes for the US market because the Obama Administration plans to promote the development of high-speed rail networks. Germany's Siemens will showcase its Velaro ICE trains in Florida this week ahead of a bidding process in the state.
The high-speed Velaro trains, built by Siemens, can travel up to 250 miles per hour (403 kilometers/hour), but in Florida this week they were brought in by truck. The special tracks along sunny Interstate 4 haven't been built yet, and the gleaming cars are just a teaser of what may come. If the German company succeeds in its plans, the trains will one day whisk passengers from Tampa to Orlando, and from Orlando to Miami.
Russia, China agree gas supply terms: Gazprom
The Sidney Morning Herald
Moscow and Beijing have agreed on key supply terms for future Russian gas deliveries to China, which is seeking to secure energy resources to fuel its growing economy, Gazprom said on Wednesday.
Russian gas giant Gazprom, keen to diversify its energy clients, has been in talks with China National Petroleum Corporation (CNPC) to start sending gas to China but the two countries have yet to agree on pricing.
Gazprom, the world's largest gas producer, said in a statement on Wednesday that Russian and Chinese officials in Beijing had agreed on "key targets and parameters of the future supplies of Russian natural gas," adding that supplies were scheduled to start in 2015.
*****
Lindsey Williams:
Deathbed Globalist "Spills Gut" On
Plan to Destroy America - Alex Jones Tv 1/6
Lindsey Williams:
Deathbed Globalist "Spills Gut" On
Plan to Destroy America - Alex Jones Tv 2/6
Lindsey Williams:
Deathbed Globalist "Spills Gut" On
Plan to Destroy America - Alex Jones Tv 3/6
Lindsey Williams:
Deathbed Globalist "Spills Gut" On
Plan to Destroy America - Alex Jones Tv 4/6
Lindsey Williams:
Deathbed Globalist "Spills Gut" On
Plan to Destroy America - Alex Jones Tv 5/6
Lindsey Williams:
Deathbed Globalist "Spills Gut" On
Plan to Destroy America - Alex Jones Tv 6/6
The Big Wall Street Banks Have Found A New Way To Strangle The American People:Predatory Property Tax Collection
TheEconomicCollapseBlog.com
It turns out that the big Wall Street banks have found a dirty new way to make loads of cash from U.S. homeowners, and they really, really don't want to talk about it. So what is this dirty new business? America's biggest financial institutions have become property tax collectors, and it is extremely lucrative. From coast to coast, the big Wall Street banks are buying up thousands upon thousands of tax liens and are making a killing by socking distressed homeowners with predatory interest, outrageous penalties and almost unbelievable legal fees. In some areas, the big banks are able to foreclose on these homes in as little as six months. The elderly and the poor are the most common targets of these practices. An absolutely brilliant expose in the Huffington Post has brought these issues to light, and it is creating quite a controversy in the financial world. The big banks are doing nothing illegal here. Local governments are offering to sell thousands of tax liens and somebody is going to end up buying them. But something seems extremely unsavory about the big Wall Street banks capitalizing on the economic downturn that they were so instrumental in causing in such a predatory manner.
ObamaCare's Incentive to Drop Insurance My state of Tennessee could reduce costs by over $146 million using the legislated mechanics of health reform to transfer coverage to the federal government.
By PHILIP BREDESEN - WSJ.com
One of the principles of game theory is that you should view the game through your opponent's eyes, not just your own.
This past spring, the Patient Protection and Affordable Care Act (President Obama's health reform) created a system of extensive federal subsidies for the purchase of health insurance through new organizations called "exchanges." The details of these subsidies were painstakingly worked out by members of my own political party to reflect their values: They decided who was to benefit from the subsidies and what was to be purchased with them. They paid a lot of attention to their own strategies, but what I believe they failed to consider properly were the possible strategies of others.
Geithner's Goal: Rebalanced World Economy
By DAMIAN PALETTA And DAVID WESSEL - WSJ.com
Treasury Secretary Timothy Geithner said he would use weekend meetings of G-20 finance ministers to advance efforts to "rebalance" the world economy so it is less reliant on U.S. consumers, to move toward establishing "norms" on exchange-rate policy, and to persuade others the U.S. doesn't aim to devalue its way to prosperity.
In an interview with The Wall Street Journal, Mr. Geithner said the world sorely needs to agree on guidelines for exchange-rate policy. "Right now, there is no established sense of what's fair," he said.
He also said the U.S. is pressing the Group of 20 industrial and developing nations to adopt numerical gauges to judge whether individual trade surpluses or deficits are "sustainable," a way to measure progress towards the goal of more balanced global growth.
Otto Von Bismark and the End of Capitalism
TheBurningPlatform.com
Our Gold Bug friends over on Zero Hedge have been very active lately in promoting a few Theories regarding the underlying cause of the collapse of the current Fiat based monetary system, with one particular Aussie newsletter promoting the idea the whole problem stems back to the creation of the Nanny State by Otto von Bismark prior to WWI.
The problem with this theory is that it completely ignores all the PRIOR crashes of the monetary system going back at least as far as the Dutch Tulip Bubble, crashes including of course the Long Depression of the 1870s following the Civil War here in the FSofA. All these crashes predated Otto by decades at least, centuries in many cases. Remember ALSO that Europe was in an almost constant state of Warfare from1700 through 1900 and this was all happening under the “wonderful” Gold standard.
Uncertain of future regulation, businesses are paralyzed
By Geoff Colvin - Fortune CNNMoney.com
FORTUNE -- Dick Kelly wishes he knew what his industry should do. "If we had a national policy and knew what the rules were, we could take action," says Kelly, CEO of Xcel Energy and chairman of the Edison Electric Institute, the association of shareholder-owned electric utilities. But Kelly's industry knows only that momentous changes in the federal laws governing it are probably on the way; what those changes might be, and when they might happen, managers have no idea. So they "are holding up decisions," Kelly says, on multibillion-dollar investments to convert old coal-fired power plants to natural gas. "Is there going to be a price on carbon?" he asks. "Will there be a timeline? Will we have to use a certain percentage of renewables?" No one knows, so nothing is happening.
Falling life expectancy and the collapse of the United States
By Gennaro Carotenuto - Pravda.ru
According to studies conducted separately by Columbia University and the World Health Organization, the United States has, in only ten years, gone from the 24th to the 49th in the world rankings of life expectancy. That is, to live around 4.5 years less than the long-living Japanese or 2.2 years less than the Italians, located in the twentieth place.
In 1960, U.S. citizens were in fifth place, behind Scandinavian countries and Holland and Australia. It took 40 years to lose 19 places and only 10 in fall another 25. Among the causes of the collapse of their real life expectancy are obesity, smoking, alcoholism, poor nutrition, improperly treated diseases, violence and other problems typical of countries that have a much worse index of human development.
Stiglitz Urges More Fiscal Stimulus Instead of Fed Easing
By Kathleen Hays and Bob Willis
Oct. 20 (Bloomberg) -- Nobel Prize-winning economist Joseph Stiglitz said today the U.S. needs more fiscal stimulus to aid the economy and that more unconventional monetary easing by the Federal Reserve would do little to spur the recovery.
Stiglitz said he sees an "excessive" Federal Reserve focus on interest rates and that another round of so-called quantitative easing wouldn't have a "significant effect" on the economy. The government instead should provide more money to states to save jobs after last year's $814-billion stimulus program.
The $1,387,796,500,000 Off-Balance Sheet Securitized Real Estate Loan Question by Tyler Durden - ZeroHedge.com
With all the hoopla around fraudclosure, it appears that pundits seem to be forgetting one important thing: namely, the fact that in addition to the $6.8 trillion in loans and leases in bank credit (per latest H.8) which is kept on the ponzi books (those afforded the mark-to-unicorn treatment by the FASB), there is also this little thing known as off-balance sheet securitization. And while the Fed was good enough to force the reclassification of around $400 billion in securitized consumer loans to bank books in March, the question of why a far greater number of securitized real estate loans continue to be carried off the bank books is (or should be) suddenly rather timely. Especially since the number is rather large: some $1,387,796,500,000 as of October 6 (seasonally adjusted) which also represent the bulk of off balance sheet holdings.
From Global Depression to Global Governance
by Andrew Gavin Marshall - CanadaFreePress.com
We now stand at the edge of the global financial abyss of a 'Great Global Debt Depression,' where nations, mired in extreme debt, are beginning to implement 'fiscal austerity' measures to reduce their deficits, which will ultimately result in systematic global social genocide, as the middle classes vanish and the social foundations upon which our nations rest are swept away. How did we get here? Who brought us here? Where is this road leading? These are questions I will briefly attempt to answer.
Depression Written into Law, Part III
By Theodore (Ty) Andros - GoldSeek.com
The US economy is being SHUTDOWN at a rapid rate by the radical Marxists in the beltway, whom having never met a businessman that they like other than those who pay political tolls -- known as campaign contributions - consider the rest of the WEALTH generating private sector to be the proverbial red headed step child. Ripe for abuseÉ
As the denizens of the beltway do a Jack-the-RIPPER on the economy to SAVE you, runaway regulation and taxation have now killed wealth creation in the G7.
"The more corrupt the state, the more it legislates." --Tacitus
With New York Fed president, Bill Dudley, and Chairman Bernanke on record for launching Quantitative Easing II, targeted inflation (financial asset inflation) and GDP, it's full steam ahead for the PRINTING PRESS. The structural incentives to produce, to create wealth and to reduce micro management through reduction of federal red tape ARE NOT being considered.
Tom Hougaard, of WhichWayToday.com says the next technical level for gold is $1,440
Why Is the Gold Price Rising So Fast and So Far?
By: Julian D. W. Phillips - GoldSeek.com
What has happened to the gold price lately?
The gold price turned around at below the long-term trend line at $1,160 and rose in an almost straight line to $1,360 before building some support at $1,350. This was after almost 18 months of consolidation between $1,050 and $1,250. The long period of consolidation was while the markets believed that there was a good chance that the recovery would gain traction and all would be well. Then the news darkened and fear and uncertainty in large doses returned alongside worrying actions on the U.S. stimulation front and the world's foreign exchanges. But far more than that happened in the gold market. It was and is a combination of all these factors synthesizing that has driven the gold price to present levels.
Currency Wars, Gresham's Law and Digital Gold Currency (DGC)
By David Knox Barker - GoldSeek.com
Introducing the Chronicles of Atticus McShrugg:
Instead of typical article format, I've created a fictional character and will chronicle his interaction with the President of the United States during these trying times of global crisis. Atticus McShrugg, a staff member in the National Security Council (NSC), is making his debut in order to speak into the fast-paced developments in the international political economy and global financial markets.
The Greek Dollar Swap Window
By: Jim Willie CB - GoldSeek.com
The Chinese are clever people. Their leaders play a good game of chess in the global scramble for commodity supply and financial dominance. Their patient strategy has tied the arms & legs of the USGovt, using their own debt securities as the binding rope. The accumulate almost reached a staggering $1000 billion, the ugly fruit of the Low-Cost Solution to invest in China from a decade ago. While much attention has come to saber rattling over currency manipulation and tiny 25 basis point interest rate hikes, even battles over rare earth metals, something has been happening in Europe of importance that involve a Chinese back door to dump USTreasurys. To be sure, the USGovt deficits and monetary policy have invited a selloff in the USDollar. In the latter months of 2009 and early months of 2010, the Jackass wrote frequently about the absurd notion of an Exit Strategy from 0% and Quantitative Easing. The USFed lost heavy credibility and looked just plain obtuse and braindead. The Japanese ZIRP and QE twin diseases were not the monogrammed cufflinks the USFed would choose for sartorial splendor.
As Dollar's Value Falls, Currency Conflicts Rise
By GRAHAM BOWLEY - NYTimes.com
Is this a currency war or what?
Fast-growing nations like Thailand are trying to devalue their exchange rates to bolster their export-driven economies.
In Washington, where "strong dollar" has been the mantra for years, policy makers are taking steps that could make the already weak dollar weaker still.
European policy makers worry that a resurgent euro will threaten growth in their own backyard. And the entire world, it seems, is jawboning China to level the playing field and let its undervalued currency, the renminbi, appreciate. It is a step that Beijing, by all accounts, does not want to take.
Dollar Is Near 15-Year Low Versus Yen on Fed Easing Prospects
By Yoshiaki Nohara
Oct. 21 (Bloomberg) -- The dollar was close to a 15-year low against the yen ahead of economic data that may add to the case for more monetary easing by the Federal Reserve that will debase the currency.
The dollar slipped from a two-week high versus the euro before a report forecast to show a gauge of leading indicators failed to accelerate last month. A Fed regional survey released yesterday showed the economy expanded in September at a "modest pace." The Australian dollar traded within two U.S. cents of parity with the greenback as gains in equities and commodities spurred demand for growth-sensitive currencies.
Dollar Sinks Amid Fed Speculation as Earnings Fuel Stocks Rally
By Rita Nazareth and Nikolaj Gammeltoft
Oct. 20 (Bloomberg) -- The dollar slid the most against the euro since July and reached a 15-year low versus the yen amid speculation the Federal Reserve will pump more cash into the economy. Boeing Co. and Yahoo! Inc. helped lead stocks higher after earnings beat estimates, while energy shares and oil rose.
The dollar snapped a three-day rally against the euro, losing 1.6 percent to $1.3950 versus the common currency, and sank to as low as 80.85 yen. The Standard & Poor's 500 Index increased 1.1 percent to 1,178.17 at 4 p.m. in New York after slumping 1.6 percent yesterday for its biggest drop in two months. Oil rebounded from its largest drop since February, returning above $81 a barrel. The yield on the 30-year Treasury bond slipped three basis points to 3.89 percent.
U.S. Treasury Says G-20 Must Progress on Currencies
By Rebecca Christie and Ian Katz
Oct. 20 (Bloomberg) -- Currencies and trade flows will be at the center of talks as Group of 20 finance ministers try to resolve differences over exchange-rate policies, a U.S. Treasury Department official said.
Some emerging-market nations are resisting market forces and keeping their currencies undervalued, creating a competitive dynamic, the official told reporters, speaking on condition of anonymity. The U.S. wants foreign-exchange rates to reflect market forces and economic fundamentals, the aide said.
The Fornicating Fed
Barry Ferguson - SilverBearCafe.com The Federal Reserve Is Now the Primary Market Influence
It seems that the Federal Reserve will not stop fornicating with our free market capitalistic system until it is no longer free and capitalism is extinguished by over-regulation. Markets themselves can only function properly when there is a bond of trust between honest supply and demand. Fornicators sever the bond of trust and the Fed has become a serial fornicator. The Fed, complicit with the current and past chairman, egged on the current credit bubble with a 'hear no evil - see no evil' approach to lending standards. They have brought the financial markets to the abyss of collapse with their derivatives and swaps. They ignored the real estate mania such that it has unraveled into a real estate foreclosure barrage that has become the crisis of the day. But of course, every fornicator must have a consenting partner. That partner is us. We have accepted the Fed's seduction of credit and thus allowed them to have their way with us. Sure, they may have liquored us up on big houses, fancy cars, and plastic money that is empowered by our simple signature. Our stock indices now have an implicit guarantee that the Fed is the 'mother of all backstops'. We knew we would eventually have to sober up. We knew it was all wrong. Yet whenever the Fed called, we answered. Look at where it has gotten us.
Unfair Trade: 10 Questions About Our Globalized Economy That Neither Conservative Or Liberal Supporters Of Current U.S. Trade Policies Can Answer
TheEconomicCollapseBlog.com
Most Americans still seem to be convinced that "free trade" is "fair trade" and that to be against current U.S. trade policies and globalization means that you are anti-business, anti-free enterprise and anti-American. In the mainstream media, any unfair trade practices that are brought up are treated as minor nuisances that will be ironed out as we march towards the glorious globalized economy of the future. But the truth is that the kind of world trade that is going on today is neither "free" nor is it "fair". Major exporting countries around the globe are openly manipulating their currencies, they are heavily subsidizing their major industries and they are erecting huge tariffs against many U.S. goods in order to protect their own domestic companies. Meanwhile, U.S. consumers enjoy mountains of cheap goods, but thousands of factories, hundreds of thousands of jobs and hundreds of billions of dollars of national wealth leave our country for good every year. So how in the world is that good for us? It is kind of like ripping apart your house to get more firewood just to keep the fire going. Eventually you aren't going to have a house anymore.
Ben Bernanke's Money Machine Is About To Go Into Overdrive
Murray Sabrin - SilverBearCafe.com
On October 15th Ben Bernanke, chairman of the Federal Reserve, gave a speech at the Federal Reserve Bank of Boston outlining his views on the economy and asserted that the FED will pursue its dual mandate vigorously: maximum employment and price stability.
Dr. Bernanke (he has a Ph.D. in economics) was a Princeton University professor before President Bush appointed him to the Board of Governors of the Federal Reserve System in 2002. In 2005, Bernanke became Chairman of the Council of Economic Advisors until 2006, when President Bush nominated him to a 14-year term on the Federal Reserve Board and to a four-year term as its chairman. President Obama reappointed Bernanke to another term as chairman this year.
Credit still tight on Main Street - NY Fed report
By Catherine Clifford - CNNMoney.com
NEW YORK (CNNMoney.com) -- Small businesses are not getting access to the credit they need, and as a result, they are struggling to generate the jobs needed to lead the nation toward recovery.
"Small firms employ nearly half of all Americans, account for about 60 percent of gross job creation, and historically have created more jobs than larger firms at the start of economic recoveries," according to a report from the Federal Reserve Bank of New York released Monday. "Yet recent contractions in business borrowing may be limiting the capacity of small businesses to play this critical role."
Deficit fighting: The first cut is the deepest
By Jeanne Sahadi - CNNMoney.com
NEW YORK (CNNMoney.com) -- Cutting the deficit.
President Obama has promised to do it. He convened a bipartisan fiscal commission to recommend ways to do it. And, as always, it's entirely unclear whether Congress will have the will to do it.
But one thing is clear: Even with all the willpower in the world, getting the annual deficit down to 3% of the economy by 2015 -- Obama's goal -- will be no mean feat. It could mean having to cut spending or raise taxes by $240 billion that year alone.
As if that's not tough enough, nearly two-thirds of the budget is effectively impossible to cut in the short term. Namely, Medicare, Social Security, other mandatory programs and interest on the debt.
Niche Lawyers Spawned Housing Fracas
By ROBBIE WHELAN
The paperwork mess muddying home foreclosures erupted last month. But the legal strategy behind it traces to a lawyer's gambit in 2006 that has helped keep one couple in their home six years beyond their last mortgage payment.
Lillian and Robert Jackson stopped paying on their home in Jacksonville, Fla., in 2004 when business dropped off at their cleaning company. Eviction might have seemed inevitable when they faced a foreclosure hearing two years later.
But their lawyer, James Kowalksi, had the idea of taking a deposition from the signer of the mortgage papers. When a document processor for GMAC Mortgage admitted she routinely signed such papers without being familiar with details of the loans, she was tagged as one of a species now known as robo-signers.
Wells Fargo dismisses foreclosure problems as analysts warn of paperwork issues
By David S. Hilzenrath - WashingtonPost.com
Banking giant Wells Fargo said Wednesday that its business shows no signs of the looming crisis some analysts fear the industry faces from shoddy lending and foreclosure practices.
"We are confident that our practices, procedures and documentation for both foreclosures and mortgage securitizations are sound and accurate," chairman and chief executive John Stumpf said in a news release as the bank announced a third-quarter profit of $3.3 billion.
Stumpf's assertion appeared at odds with a March deposition in which a Wells Fargo vice president of loan documentation described engaging in the sort of "robo-signing" that has raised widespread questions about the legitimacy of foreclosures.
Regulator for Fannie Set to Get Litigious
By NICK TIMIRAOS - WSJ.com
The federal regulator overseeing Fannie Mae and Freddie Mac hired a law firm specializing in litigation as the agency considers how to move forward with efforts to recoup billions of dollars on soured mortgage-backed securities purchased from banks and Wall Street firms.
The Federal Housing Finance Agency, which in July issued 64 subpoenas to issuers of mortgage securities, bank servicing companies and other entities, is working with Quinn Emanuel Urquhart & Sullivan LLP, a Los Angeles-based firm that specializes in business litigation, to coordinate its investigations.
Foreclosure system in chaos Lenders and lawmakers discover thousands of mishandled mortgage documents
WashingtonPost.com Introduction
During the housing boom, millions of homeowners got easy access to mortgages. Now, some lenders have discovered many mortgage documents were faked, forged or otherwise mishandled. Ally Financial, J.P. Morgan Chase, Bank of America and PNC have halted foreclosures in some states as they attempt to determine the depth and scope of the irregularities. Meanwhile, attorneys general in all 50 states have launched an investigation into the foreclosure system, and politicians in Washington are pushing for a federal investigation into the matter. However, the White House is resisting calls for a national moratorium on foreclosures because of worries about the negative impact such a move could have on the economy.
Will Bankers go to Jail for Foreclosure-gate?
by Stephen Gandel
More and more, Foreclosure-gate is looking like the housing bust's Enron.
One of the amazing developments of the unraveling of the financial crisis has been the fact that there have been so few people we can actually point to and say without a doubt that guy or gal is a crook. Yes, Bernie Madoff and his fellow ponziers, but they were only flushed out by the financial crisis. They didn't really cause it. The Bear Stearns hedgies beat their case. The mastermind of AIG's demise Joe Cassano looks to have made a clean getaway. Lehman's Dick Fuld is still in the clear. Goldman and just last week Countrywide's executives had to pay out large fines. But none of them are headed to jail. John Paulson and other hedge funds that help construct CDO debt bombs and bet against them, haven't even been forced to give some of their winnings back. I can't think of anyone of any real consequence who is facing hard time.
Thanks to foreclosure-gate that may soon change.
Geithner, China and Foreclosure-gate
By Dian L. Chu - ZeroHedge.com
Global markets freaked out on Tuesday primarily due to the following events:
U.S. Treasury Secretary Geithner's speech on Monday pledging "The United States and no country around the world can devalue its way to prosperity."
Within hours after Geithner's statement, China made a surprise interest rate hike - its first since 2007--raised fears that Chinese growth will slow with global implications.
The unraveling of the "foreclosure-gate" could mean banking crisis 2.0
Geithner's comments, uncertainty over the Chinese economy and worries about the U.S. mortgage market led a flight by investors into U.S. Treasuries, which sent the dollar surging 1.7 percent against a basket of six major currencies on Tuesday, while shifting capital away from equities, gold and other commodities, including crude oil.
FRAUDCLOSURE
"MBS INVESTORS ARE CALLING THEIR LAWYERS" 10-18-2010
This Administration Still Doesn't Have A Clue
About The Foreclosure Crisis
By Bill Black, Benzinga - BusinessInsider.com
Sheila Bair, who has chaired the Federal Deposit Insurance Corporation (FDIC) since her appointment by President Bush on June 26, 2006, has been the only top federal banking regulator willing to upset the industry she regulates. Reuters reports on her less than vigorous reaction to the disclosure of endemic foreclosure fraud.
"We have been told that this is a process issue - that all of the information is in the file, the problem is the person who needed to sign the affidavit had not been looking at the file before they'd done so. So we need to independently verify that," Bair said.
"Foreclosure is a very serious thing and it should only being undertaken after loan modification efforts are not feasible. And that the files are fully documented."
Foreclosure freeze could put security clearances at risk
By Dina ElBoghdady and Dana Hedgpeth - Washington Post
Employees with security clearances are monitored by the government for financial problems that would make them vulnerable to bribery or blackmail. And with many financial companies adopting some form of foreclosure freeze in recent weeks, it's taking longer for some delinquent borrowers to resolve their mortgage cases and put their troubles behind them, the lawyers said.
This problem is especially acute in the Washington region, home to nearly a third of the the nation's 854,000 employees with top-secret clearances.
"Resolving debt is more complicated when the lenders are in paralysis," said Dennis Sysko, a national security lawyer in Glen Burnie. "The longer it is unresolved, the longer the cloud remains."
New York requires lawyers to sign off on all foreclosures
By David B. Caruso, AP - USAToday.com
NEW YORK - The chief judge of New York's courts implemented a rule Wednesday requiring every lawyer handling a foreclosure to sign a form verifying that all paperwork in the case is accurate.
Attorneys already have an obligation to ensure that the documents they present to the court are valid, but New York Chief Judge Jonathan Lippman said having them sign something affirming that all papers got a proper review will hold them accountable like never before.
Florida activists read between the lines on foreclosure paperwork
By Ariana Eunjung Cha - Washington Post
WEST PALM BEACH, Fla. - Nearly a year before the national furor over foreclosures began, Lisa Epstein, a nurse, ran into three other amateur sleuths who separately were investigating shoddy practices at mortgage companies.
While meeting for the first time in November at an old one-story law office in this city, the four strangers compared notes and began to piece together the scope of the problem: All over the United States, big financial firms might have been using fraudulent paperwork to evict struggling borrowers from their homes.
Now tight-knit, the group is largely responsible for setting off the growing firestorm over foreclosures.
Foreclosures Profit Some Equity Firms
By BARRY MEIER - NYTimes.com
With a surge in lawsuits against law firms specializing in foreclosures, a case in Mississippi is casting light on another aspect of the mortgage mess - the connection between Wall Street private equity firms and those law firms, often known as foreclosure mills.
The lawsuit on behalf of homeowners claims that Great Hill Partners, a private equity firm, has benefited from what the lawsuit calls an illegal fee-splitting arrangement between Prommis Solutions and several of the busiest foreclosure law firms it controls. Great Hills is the biggest stakeholder in Prommis, a company that acts as a middleman between mortgage servicers and law firms.
iDepression 2.0
James Quinn - TheBurningPlatform.com
As I listen to pundits, politicians and populists expound on the jobs situation in our country day after day, as if they knew what they were talking about, I’m reminded of the Seinfeld episode where George quits his job as a real estate agent. He sits in Jerry’s apartment and ponders whether he could become the general manager of the Yankees, a sportscaster, getting paid to watch movies, or a talk show host. After the discussion with Jerry, he realizes that he has absolutely no skills that are transferable to another career. Everyone in America would like to be the General Manager of the Yankees or get paid for watching movies, but that isn’t how it works in the real world.
Employer Credit Checks on Job Seekers Draw Scrutiny
By SARA MURRAY - WSJ.com Checking the credit histories of job applicants - a common practice among employers - is coming under fire.
Four states have passed laws in the past three years that limit the practice, and similar bills have been introduced in 20 other states and Congress. The issue has surfaced in the wake of the recession, which has left many unemployed workers with tattered credit.
The underlying concern is that poor credit could become a barrier to landing a job. Employers contend credit checks help them evaluate candidates and protect against fraud.
Oil Near $82 After Biggest Gain in Five Weeks on Dollar, Supply
By Mark Shenk and Ben Sharples
Oct. 21 (Bloomberg) -- Oil for December traded near $82 a barrel in New York after the November contract rose the most in five weeks yesterday as the dollar fell and crude U.S. stockpiles gained less than forecast.
November futures, which expired yesterday, jumped 2.9 percent after the Federal Reserve said the economy expanded at a "modest pace" in September and early October, sending the U.S. currency lower. A weaker greenback bolsters the appeal of raw materials to investors. The Energy Department said that crude supplies climbed less than half the projection in a Bloomberg News survey.
Your retirement account might get smaller this year
By Blake Ellis - CNNMoney.com
NEW YORK (CNNMoney.com) -- Older Americans whose retirement accounts took a beating from the market's downturn caught a break last year: The government suspended rules that required them to make annual withdrawals, buying them time for their portfolios to recover.
But now that the markets are starting to come back, Uncle Sam wants his share again.
That means if you're 70 ? or older and have a retirement account -- including a 401(k) or IRA -- you must resume withdrawing the annual minimum from those plans this year, so that the money can be taxed. The so-called "Required Minimum Distribution," or RMD, you must take out depends on your age and the size of your retirement account.
Cost of your health plan to rise 14%
By Michelle Andrews - CNNMoney.com
(MONEY Magazine) -- It's that time of year when employers deliver bad news about next year's benefits.
Chances are you'll learn that your 2011 health insurance tab will be sharply higher, as companies continue to shift the burden of rising costs onto their workers.
Employees' share of premiums for a family plan is up an average 14%, to $3,997, vs. just a 3% rise in the total bill, according to the Kaiser Family Foundation.
And it's not just premiums that are spiraling higher. You're also likely to be hit with higher deductibles and out-of-pocket maximums as well as bigger bills for doctor's visits and drugs.
Feds accuse Mich. Blue Cross of anticompetitive contracts
By Alison Young, USA TODAY
The U.S. Justice Department sued Blue Cross Blue Shield of Michigan on Monday, accusing the state's dominant health insurer of driving up prices for consumers with anti-competitive practices.
"Let me be clear. We will challenge similar anticompetitive behavior anywhere else in the United States," Assistant Attorney General Christine Varney said.
The lawsuit alleges that Blue Cross has negotiated clauses in its contracts requiring that hospitals charge any competing insurer as much as 40% more than they charge Blue Cross. In exchange, Blue Cross agreed to pay many Michigan hospitals higher prices for their services, the suit says.
The Multicultural Cult: Part II
BY THOMAS SOWELL - TheNewAmerican.com
There was a reason why employers in the middle of the 19th century had signs that said, "No Irish need apply" - and why employers in the middle of the 20th century no longer had such signs. It was not that employers had changed. The Irish had changed.
The Catholic Church for years worked to bring about such changes among the Irish immigrants and their offspring, just as various religious and secular organizations among the Jews, among blacks and among other groups worked to bring about changes within their respective groups. By and large these efforts paid off. All these groups were advancing, long before there were civil rights laws.
Yet today, attempts to get black or Hispanic youngsters to speak the language of the society around them are decried by multiculturalists. And any attempt to get them to behave according to the cultural norms of the larger society is denounced as "cultural imperialism," if not racism.
OBAMA CONTINUES TO OMIT 'CREATOR' FROM DECLARATION OF INDEPENDENCE
by Meredith Jessup - TheBlaze.com
During a speech Monday, President Barack Obama once again omitted the Declaration of Independence's mention of man's "Creator" as the source of his "unalienable rights." While delivering remarks at a dinner fundraiser for the Democratic Senatorial Campaign Committee (DSCC) in Rockville, Md., President Obama spoke about what he called the "essence" of the upcoming midterm election:
As wonderful as the land is here in the United States, as much as we have been blessed by the bounty of this magnificent continent that stretches from the Atlantic to the Pacific, what makes this place special is not something physical. It has to do with this idea that was started by 13 colonies that decided to throw off the yoke of an empire, and said, "We hold these truths to be self-evident, that all men are created equal, that each of us are endowed with certain inalienable rights, that among these are life, liberty and the pursuit of happiness."
The Mainstream Media Is Now Obsolete
By Giordano Bruno - Neithercorp Press
The progression of human society relies upon the steady distribution of information. The quality of that information, its accuracy and its honesty, determines the overall health of the cultures we create. When a source of information becomes compromised by unhealthy political ambition, social dogma, or the strangling hands of elitism, it's like a poison well, spreading plague and pestilence throughout the nation, or even the world. Widely disseminated lies inspire delirium and madness in the masses faster than typhoid fever.
In America today, the person searching for a pure source of truth in the media inevitably stumbles across many poison wells.
Even if they are not yet actively pursuing alternative outlets of information, many people are aware, at least intuitively, when someone is trying to swindle them. You can present us with the assurance of delectable sirloin steaks on ornate silver platters, but if our faces are struck with the sickly stench of decay, we aren't going to bite. Through its dishonesty and its distinct lack of substance, the mainstream media has turned up more noses than any putrid slab of unkempt beef ever could. The raw data is merciless in regards to the implosion of the MSM ...
Wall Street mogul picked for State Department post
Nides raised Clinton cash
By Jim McElhatton - The Washington Times
President Obama's nominee for deputy secretary of state has earned more than $8 million in salary and bonuses since January 2009 as an executive at a Wall Street bank that received a federal bailout.
Thomas R. Nides, a six-figure fundraiser for Hillary Rodham Clinton during her 2008 presidential run, disclosed his compensation from Morgan Stanley in a recent filing with the U.S. Office of Government Ethics.
Mr. Nides, the company's chief operating officer, also said he remains eligible for additional bonus money at Morgan Stanley, which repaid its share of the federal bailout last year.
Deaths, injuries raise questions for popular Remington 700 rifle
By Scott Cohn, CNBC via USAToday.com
The manufacturer of the world's most popular hunting rifle has been wrestling for decades with a critical safety issue, and at least twice considered a nationwide recall of the gun, according to corporate insiders and internal documents revealed in a ten-month CNBC investigation.
But the Remington Arms Company has never alerted the public to the internal concerns, and insists the gun is free of defects, despite thousands of customer complaints.
Top Federal Prosecutor Vows Crackdown On Corrupt State Legislators
ABC News Investigation Finds More Than 80 Indictments And Convictions
By BRIAN ROSS, MATTHEW MOSK, RHONDA SCHWARTZ and RICHARD ESPOSITO - ABCNews.com
One of the nation's top criminal prosecutors said this week that the U.S. Department of Justice is aggressively pursuing cases against corrupt state legislators in several states on the heels of recent arrests in Alabama, where lawmakers have been accused of accepting bribes from gambling lobbyists in exchange for their votes.
"State officials are absolutely in our sights," said Lanny Breuer, the Assistant Attorney General for the Criminal Division of the U.S. Department of Justice, in an exclusive interview with ABC News. "Even at the most local county level. If we hear about corruption we're going to pursue it -- whether you're the city commissioner, the county person, the state person, or the highest person in the federal government."
AZ Governor: Obama, Calderon Both Want Illegal Immigration to Continue to Increase Liberal Vote in U.S.
By Terence P. Jeffrey
(CNSNews.com) - Arizona Gov. Jan Brewer told CNSNews.com that she believes neither President Barack Obama of the United States nor President Felipe Calderon of Mexico wants to secure the U.S.-Mexico border because they hope illegal aliens will increase liberal voters in the United States.
"I think it's just amazing that the Mexican government, along with President Calderon and the bordering governors that interact with us, they do not want our borders secure," Brewer said in a telephone interview today. "I mean, they have made it very, very clear."
U.S. Advances Saudi F-15 Package
By ADAM ENTOUS - WSJ.com
WASHINGTON - The Obama administration notified Congress it plans to sell Saudi Arabia up to $60 billion in advanced military aircraft, including F-15s equipped with bunker-buster bombs that Washington sees as part of an effort to contain Iran.
The package, the largest overseas U.S. arms deal to date, "supports our wider regional security goals in the Gulf" without undercutting ally Israel's military edge, Assistant Secretary of State for Political-Military Affairs Andrew Shapiro said.
"We want to make sure that they have the tools that they need to be able to defend themselves," he said of Saudi Arabia, a key regional ally. The kingdom had no immediate comment.
Jordan Maxwell -- Jeff Rense Interview 10-18-10 Part 1/3
Jordan Maxwell -- Jeff Rense Interview 10-18-10 Part 2/3
Jordan Maxwell -- Jeff Rense Interview 10-18-10 Part 3/3
Fright-Wing Extremism Obama says he's failing because you're scared.
By JAMES TARANTO - WSJ.com
"The only thing we have to fear is fear itself--nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance," said Franklin D. Roosevelt at the start of his First Inaugural Address.
"Part of the reason that our politics seems so tough right now, and facts and science and argument does not seem to be winning the day all the time, is because we're hard-wired not to always think clearly when we're scared," Barack Obama said at a Boston fund-raiser for the Democratic Senatorial Campaign Committee over the weekend. "The country is scared."
Banks Sold the Same Mortgage Over and Over to Investors
By: David Dayen - FDL News Desk
I mentioned this at the end of this post about investor lawsuits, but it deserves to be highlighted. This is a level of fraud that I probably should've seen coming, but didn't. Apparently, Bank of America has admitted in a court filing that they sold the same mortgage loan in multiple pools to investors. In layman's terms, say I own the FDL News Cupcake Food Truck and you come up to buy a cupcake. I sell it to you, and then I sell the same cupcake to the guy behind you, and the guy behind you. As you all wait for your order, you talk to each other and realize that you were all sold the same cupcake. So who actually owns it?
Ron Paul - U.S. Heading for Soviet-Style Economic Collapse
China Rate Move May Lure Capital, Complicating Inflation Fight
By Bloomberg News
Oct. 20 (Bloomberg) -- China's decision to raise interest rates to combat inflation may have the opposite effect by luring more capital into the world's fastest-growing major economy.
The central bank yesterday unexpectedly raised borrowing costs for the first time since 2007, lifting the benchmark one- year lending rate to 5.56 percent from 5.31 percent. The deposit rate was increased to 2.5 percent from 2.25 percent.
China's policy makers are trying to curb lending and prevent an asset-price bubble in a country that surpassed Japan this year as the world's second largest economy. The danger is that higher rates will funnel speculative money from abroad into China, pushing property and consumer prices higher. The move comes days before Group of 20 officials gather in South Korea to discuss the global economy amid disagreements on whether the yuan is undervalued.
China: US has "Clearly a Double Standard" on Exchange Rates
By Rocky Vega - The DailyReckoning.com
10/19/10 Stockholm, Sweden - It sounds hard to believe, but apparently China has detected a US "double standard," whereby the US is demanding China strengthen its renminbi currency while itself intentionally weakening the dollar through money printing. These days, China is almost getting a little too good at calling it like it sees it.
According to the AFP:
"The criticism of US monetary policy and its weakening dollar comes as Washington maintains pressure on Beijing over its yuan exchange rate, which US lawmakers claim is grossly undervalued and causing global trade imbalances.
China raises lending, deposit rates as inflation accelerates
By Bloomberg News
China raised its benchmark lending and deposit rates for the first time since 2007 after inflation accelerated to the fastest pace in 22 months.
The one-year deposit rate will increase to 2.5 percent from 2.25 percent, effective tomorrow, the People's Bank of China said on its website today. The lending rate will increase to 5.56 percent from 5.31 percent, it said.
China's inflation quickened to 3.5 percent in August, highlighting overheating risks that have prompted the government to curb credit and clamp down on the real-estate market this year. Higher interest rates may encourage inflows of speculative capital from abroad, complicating management of the fastest-growing major economy.
China Sparks Wide Sell-Off Sudden Rate Hike Spurs Fear of Drop in Giant's Growth;
Emerging Currencies Pull Back
By TOM LAURICELLA in New York, ANDREW BATSON in Beijing - WSJ.com
China surprised investors by raising interest rates Tuesday, sparking a world-wide sell-off in stocks, commodities and emerging-markets currencies as investors lowered their expectations for Chinese growth, which has been seen as a key driver of the global economy.
China's central bank announced it would raise key rates by a quarter percentage point, the first move since it cut rates in December 2008. While many investors had been expecting China to raise interest rates in coming months, the timing of the move was unexpected. It is viewed as the first in a series of interest rate increases.
China's interest-rate hike causes turmoil The central bank's move is aimed at reining in an unbridled real estate market and inflation in China. The move sends stocks and commodity prices plunging around the globe and raises new concerns about the U.S. recovery.
By Don Lee and David Pierson, Los Angeles Time
A surprise interest-rate hike by China raised the prospect Tuesday that the world's economic locomotive will begin chugging at a slower speed - a move that battered stocks and commodity prices around the globe and raised fresh uncertainties over continued recovery in the U.S. and other developed nations.
The immediate aim of the action by China's central bank was to cool the nation's overheated real estate market and rising inflation. With more rate increases expected, it could slow the overall growth of the world's second-largest economy.
China Rate Move May Lure Capital, Complicating Inflation Fight
Oct. 20 (Bloomberg) -- China's decision to raise interest rates to combat inflation may have the opposite effect by luring more capital into the world's fastest-growing major economy.
The central bank yesterday unexpectedly raised borrowing costs for the first time since 2007, lifting the benchmark one- year lending rate to 5.56 percent from 5.31 percent. The deposit rate was increased to 2.5 percent from 2.25 percent.
China's policy makers are trying to curb lending and prevent an asset-price bubble in a country that surpassed Japan this year as the world's second largest economy. The danger is that higher rates will funnel speculative money from abroad into China, pushing property and consumer prices higher. The move comes days before Group of 20 officials gather in South Korea to discuss the global economy amid disagreements on whether the yuan is undervalued.
Gerald Celente (17-Sept-10) - 'Get money out of the bank'
For Orderly Dissolution Of The Fed
Before It Does Us Even More Harm
By JIM POWELL - IBD - Investors.com
Word is that the Federal Reserve is getting new suggestions to again consider targeting interest rates.
Whatever the merits of the suggestions, they highlight an amazing fact: The Fed was established 97 years ago, and Fed officials were given considerable power over the economy as if they knew what they were doing, but they didn't. They're still winging it today.
The Fed failed its first big test in 1920 when the end of World War I was followed by the sharpest depression on record. Wholesale prices plunged more than 50%, the economy contracted by almost 24%, and unemployment doubled to 11%. This was the kind of crisis the Fed was supposed to prevent.
Gold Daily Chart - Intraday - The Retracement
JESSE'S CAFÉ AMÉRICAIN
If you are a patron of this cafe, you cannot say that the breakout and rally to 1375, and the retracement currently underway, were not prominently placed on the menu for some time.
So now what? Gold will retrace back to a more sustainable trend, consolidate, and then resume its bull market rally to the minimum measuring objective of 1455 and probably higher.
If there is a general liquidity panic gold will overshoot to the downside, perhaps considerably, and then gather itself and rally sharply back to the trend. I doubt that it would break the 1280 level except for an intra-week plunge, but that is always possible.
There will be the usual displays of human emotion, but this is a natural and healthy correction in a bull market. I was becoming very concerned that gold might continue on this new, more aggressive trajectory all the way to 1455. This would have resulted in a more damaging correction. The green trendlines are the 'safest path' for a sustained bull market.
Gathering Storm: Govt's, Central Banks Pushing Toward Even Bigger Meltdown
By Rocky Vega - The DailyReckoning.com
10/19/10 Stockholm, Sweden - A group of 18 investment experts and fund managers have joined together to publish a new book called, "The Gathering Storm," in an attempt to sound an urgent alarm about how the global economy may be spiraling toward a "doomsday" that's far worse than anything that's been witnessed during the past three years.
Patrick Young, editor of The Gathering Storm, suggests, "When you've drunk three bottles of vodka, then you may well think that you're capable of putting the world to right. But, at the same point in time you know you're going to wake up in the morning with a hangover."
Doomsday Denial: Collapse 2.0 looms as UK calm before storm
Currency War: Germany about to lose 66% of its gold reserves
von Max Keiser und Lars Schall
Jim Rickards lays out a plan to commandeer Germany's and all foreign depositors of sovereign gold at the New York Fed as currency wars heat up and the 'nuclear option' of hoarding and raising the price of Gold is contemplated by an embattled Fed as a way to force down the exchange value of the US dollar.
At "KingWorldNews.com", Eric King published today an interview with James G. Rickards regarding present and future developments in the gold market. Mr. Rickards is a writer, lawyer and economist with over 30 years experience in global capital markets. He is Senior Managing Director at Omnis, Inc., a consulting firm in McLean, VA and is the leading practitioner at the intersection of global capital markets and national security.
The interview, in which Mr. Rickards states "that the U.S. is the Saudi Arabia of gold," can be found here as a MP3:
Geithner Weak Dollar Seen as U.S. Recovery Route
By Ian Katz and Simon Kennedy
Oct. 19 (Bloomberg) -- For U.S. Treasury Secretary Timothy F. Geithner, a weaker dollar may now be in the national interest.
The dollar has dropped more than 7 percent since Aug. 27, when Chairman Ben S. Bernanke signaled the Federal Reserve is prepared to ease monetary policy. Where once such a decline may have been met with resistance from the U.S., Geithner may now be tolerating it as a way of bolstering the recovery.
Peter Schiff It's Scary How Clueless Bernanke Is
China Rate Rise Won't Halt Commodities Rally
By Bloomberg News
Oct. 20 (Bloomberg) -- China's interest rate increase will not halt the rally in commodity prices after short-term corrections, Wanda Futures Co. said.
The government's unexpected move to raise borrowing costs signals confidence in the strength of the Chinese economy, Wang Chen, director of research at Wanda, wrote in an e-mail today. Wanda Futures is the second-biggest brokerage on China's Dalian Commodity Exchange.
"The market has overreacted and the rallies will likely resume," Wang wrote. The rate increase may have more impact on cotton and soybean prices, because China is the biggest buyer of both crops, Wang wrote. It's unlikely to affect sugar and coffee, of which China imports relatively little, he said.
Gold eases on strong dollar, awaits Fed move
SINGAPORE (Commodity Online) : Gold prices eased marginally in Asian trade Tuesday as the dollar remained stronger.
Spot gold was seen trading at $1368.64 an ounce at 1.00 p.m Singapore time while Gold for December delivery on the comex in New York was at $1,368.90 an ounce.
Analysts however said the bullion is likely to climb back on speculation the Federal Reserve will take monetary stimulus measures to revive the economy amid low inflation and an unemployment rate near 10 percent.
The US Fed on Monday said production at U.S. factories mines and utilities unexpectedly fell 0.2 percent in September, the first decline since the recession ended in June 2009.
Gold Plunges to 2 Week Low as U.S. Dollar and Yen Push Higher
By: Adrian Ash - MarketOracle.co.uk
GOLD PRICES fell Tuesday lunchtime in London, unwinding an earlier rise made against all currencies bar the US Dollar and Japanese Yen, which then knocked gold bullion back to two-week lows at $1345 per ounce and ´3530 per gram respectively.
European stock markets also slipped, while US crude oil fell back below $82 per barrel.
Silver prices dropped below $24 per ounce for the second day running.
"A deluge of monetary policy makers give their opinions on the economy this afternoon," notes one London gold dealer in a note, as the European Central Bank hosts a conference in Frankfurt, with speeches from ECB chief Jean-Claude Trichet, Bundesbank president Axel Weber, and new US Fed voting member Janet Yellen.
Jim Rogers on Freedom Watch with Judge Napolitano 10 /16 /10
A Rising U.S. Dollar Amidst a Currency War?
By: Marty Chenard - marketOracle.co.uk
Wall Street has been pointing out how a falling Dollar is good for stocks ... especially for international companies. What happens if the Dollar rises now?
Our Advanced subscribes have been aware that the Dollar has been in a very large triangular pattern. Base on the pattern, we established a downside target between 76 to 77 last July. Our actual downside support was at 76.20. Last Friday (October 15th.), the Dollar fell to 76.15 on an intra-day basis. Therefore, the bottom support has now been reached.
So, what now?
The next real question is about whether or not we hold the 76-77 support with a currency war going on.
Ron Paul - Turn Off the Printing Presses
Inflation and Treasury Bonds
BY STEVE SAVILLE Monetary Inflation
You can track what's happening to money-supply growth at Austrain money supply. What we generally refer to as TMS (True Money Supply) is called TMS2 at the afore-linked web site.
As at the end of September, our preferred measure of US money supply (TMS2) had a year-over-year growth rate of 11.2% and had spent 20 months in double digits. This obviously constitutes substantial monetary inflation, although apparently not substantial enough for the Fed. The year-over-year growth rate of TMS1, a narrower measure of US money supply that doesn't include savings deposits, was 4.9%. The growth rate of TMS1 has been slow enough over the past few months to boost the convictions of some deflation forecasters, but note that it is now rising.
Dow Dives Below 11,000 on China Rate Hike, Earnings
By DAN BURROWS - DailyFinance.com
Stocks fell sharply Tuesday after a surprise rate hike from China's central bank and mixed quarterly earnings reports led to heavy selling in technology, materials and energy stocks. The dollar rose while gold and oil fell amid concern that any move by China to curb its growth could slow the pace of global recovery.
The blue-chip Dow Jones Industrial Average lost 165 points, or 1.5%, to close at 10,979. The tech-heavy Nasdaq Composite dropped 44 points, or 1.9%, to settle at 2,437. The broader S&P 500 shed 19 points, or 1.6%, to close at 1,166.
State has plan to help Ohioans avoid foreclosure
By Lauren Lowrey - WTOL.com
TOLEDO, OH (WTOL) - Ohio has been awarded $570 million from the federal government for the state's Restoring Stability: A Save the Dream Ohio Initiative program to help people avoid foreclosure.
The Ohio Housing Finance Agency (OHFA) will administer the program in an effort to help around 46,000 Ohioans who are at risk of foreclosure.
Leaders from across the state worked to create a strategy to distribute the federal funds and assist Ohioans who have experienced a financial hardship.
The OHFA's Cindy Flaherty helped write the program's rules.
"Up until now, primarily what we've been able to do is offer housing counseling assistance to people who were trying to get loan modifications or to work with their mortgage servicer," said Flaherty. "Now there is assistance available for people who need help paying their mortgage or need help getting caught up with their mortgage."
Peter Schiff - FOMC statement, Pres. Obama' ...
Dow drops below 11,000 as dollar gains
By David K. Randall - WashingtonTimes.com
NEW YORK - A stronger dollar and a surprise interest rate hike in China that may slow that country's economy helped push stocks sharply lower Tuesday.
The Dow Jones industrial average fell below 11,000 for the first time in a little more than a week, reversing a streak that had pushed the index up nearly 7 percent for the year. It was the largest drop the stock market since early August.
Bank of America posts $7.7B loss on special charge
By Pallavi Gogoi and Stephen Bernard - AP - WashingtonTimes.com
NEW YORK (AP) - Bank of America Corp. said Tuesday it lost $7.65 billion during the third quarter due to a charge related to credit and debit card reform legislation passed over the summer.
In a dramatic shift, the bank also said it will change its consumer banking strategy to focus on providing customers with incentives to do more business with the bank instead of generating revenue through penalty fees such as overdraft charges.
The new legislation that caused Bank of America to take the $10.4 billion charge limits fees banks can collect when merchants accept debit cards. BofA said that change would reduce future revenues in its card business.
FDIC Aims to Shed Some Real-Estate Assets Agency to Launch Its First CMBS Deal as Bank Failures Mount and the Volume of Distressed-Property Loans Increases
By LINGLING WEI - WSJ.com
With more banks collapsing because of commercial real-estate lending, the Federal Deposit Insurance Corp. is working on a new way to sell failed banks' hard-to-value real-estate assets back to the private sector, according to people familiar with the matter.
Up until now, the FDIC has mostly sold soured property loans to investors in partnerships with the agency. These arrangements enticed private investors to buy distressed real-estate assets while giving taxpayers the opportunity to make money should the assets rise in value.
N.Y. Fed: Banks Should Buy Mortgages
By NELSON D. SCHWARTZ - NYTimes.com
To the long list of those picking fights with banks over bad mortgages, add the Federal Reserve.
Two years after the Fed bought billions of dollars in mortgage securities as part of the financial bailout, its New York arm is questioning the paperwork = and pressing banks to buy some of the investments back.
The Federal Reserve Bank of New York and several giant investment companies, including Pimco and BlackRock, have singled out Bank of America, which assembled more than $2 trillion of mortgage securities from 2004 to 2008.
Peter Schiff Wall Street writes US law
Housing Starts and the Unemployment Rate
by CalculatedRisk
This graph shows single family housing starts and the unemployment rate (inverted) through September. Note: Of course there are many other factors too, but housing is a key sector.
You can see both the correlation and the lag. The lag is usually about 12 to 18 months, with peak correlation at a lag of 16 months for single unit starts. The 2001 recession was a business investment led recession, and the pattern didn't hold.
Housing starts (blue) rebounded a little last year,and then moved sideways for some time, before declining again in May.
Feds Launch Foreclosure Probe, and Chicago Halts Evictions
By DANNY KING - DailyFinance.com
Federal agencies are investigating banks' foreclosure-documentation process after some major financial institutions have said they would either review or suspend foreclosures because of possible errors, the Associated Press reported, citing White House Press Secretary Robert Gibbs. Meanwhile, Chicago-area law enforcers are halting foreclosure-related evictions until banks provide them with affidavits legitimizing the foreclosures, AP said in a separate report Tuesday.
Gibbs said an interagency task force on financial fraud is probing the foreclosure process, while the Federal Housing Administration, which guarantees mortgages, has launched its own investigation as well. Gibbs added that the White House will support efforts from all 50 states to investigate the foreclosure process.
Chicago sheriff says no to enforcing foreclosures
CNBC.com
CHICAGO - Two of the largest U.S. mortgage servicers have said they will resume home foreclosures, but a big-city sheriff has news for them: he won't enforce their foreclosure evictions.
The sheriff for Cook County, Illinois, which includes the city of Chicago, said on Tuesday he will not enforce foreclosure evictions for Bank of America Corp, JPMorgan Chase and Co. and GMAC Mortgage/Ally Financial until they prove those foreclosures were handled "properly and legally."
Bank of America, the largest U.S. mortgage servicer, and GMAC, on Monday both announced rollbacks from their foreclosure moratoriums.
The announcement by Cook County Sheriff Thomas Dart comes after weeks of damaging accusations of shoddy paperwork that may have caused some people to be illegally evicted from their homes.
Peter Schiff -'We're screwed worse'
Florida Homeowners Are Losing The Fight But It's Not Because Of The Banks Since starting MFI-Miami over two years ago, I've seen a lot of craziness in regards to foreclosure rescue. Matter of fact, you could call it the wild, wild west in Florida and with the recent exposure of robo-signers in the mainstream media, it's only gotten worse.
In Florida alone, the number of foreclosure defense attorneys has exploded from 12 in June of 2008 to over 500 today. Of those 500, nearly 95% of them were unemployed former title attorneys or corporate attorneys who jumped on the foreclosure "bandwagon" because they saw dollar signs and wanted to keep up their appearance of success. To compound the problem most of these attorneys are grotesquely under-qualified to practice this type of law and most are overcharging clients or charging for work that is not being performed.
As foreclosure freeze spreads, more could stop making payments, economists warn
By Brady Dennis - Washington Post Staff Writer
FORT MYERS, FLA. - In his spacious cookie-cutter townhouse on a tidy street near downtown Fort Myers, Joshua Bartlett has waited nearly three years for the knock on the door that never comes.
He hasn't made a mortgage payment since late 2007 and doesn't plan on starting now. He could benefit from the recent halt on foreclosures announced by major lenders, amid concerns that flawed paperwork has been used to seize homes across the country, because it means he'll likely be able to stay even longer without paying.
New Challenges to the U.S. Employment Problem
By: Hans Wagner - MarketOracle.co.uk
The view of the employment numbers for September gives the impression that the economy is improving. The private sector is adding jobs even as the government reduces employment as census workers end their assignments. Looking deeper, the employment situation faces new challenges from state and local governments dealing with their revenue short falls.
September Unemployment
The private sector generated 67,000 new jobs in September indicating the economy is recovering at a slow pace. To absorb all the new entrants due to population growth, the economy must generate from 100,000 to 120,000 new jobs each month. Add in the more than 14 million people unemployed and about the same number underemployed and it is clear that the private sector must grow at a much faster pace to bring the unemployment rate down.
Gerald Celente (17-Sept-10) -
'The Tea Party is just the beginning'
Huge Rise in U.S. Unemployment Expected After Mid-Term Elections
By: Mike Shedlock - MarketOracle.co.uk
Earlier this month Gallup released a survey that showed unemployment rose .8% to 10.1%
Unemployment, as measured by Gallup without seasonal adjustment, increased to 10.1% in September -- up sharply from 9.3% in August and 8.9% in July. Much of this increase came during the second half of the month -- the unemployment rate was 9.4% in mid-September -- and therefore is unlikely to be picked up in the government's unemployment report on Friday.
11 Tucson teachers sue Arizona over new 'anti-Hispanic' schools law
By Michael Martinez and Thelma Gutierrez, CNN
Tucson, Arizona (CNN) -- Eleven Tucson, Arizona, educators sued the state board of education and superintendent this week for what the teachers consider an "anti-Hispanic" ban looming on Mexican-American studies.
The suit comes in a state already roiled by a controversial immigration law that is being challenged in court.
On Tuesday, state Superintendent of Public Instruction Tom Horne defended the new law, which will go into effect December 31. The law authorizes the superintendent to stop any ethnic studies classes that "promote the overthrow of the United States government ... promote resentment toward a race or class of people ... (or) advocate ethnic solidarity instead of treatment of pupils as individuals."
ObamaCare, for Some Step right up and get your waiver.
WSJ.com
Well, well. In the clearest evidence so far that ObamaCare is harmful in practice and an election-year liability, the Obama Administration has decided not to enforce some of the law's "consumer protections." At least when the results are politically embarrassing.
Over the last several weeks the Health and Human Services Department has granted dozens of temporary waivers to certain ObamaCare mandates so that insurers and businesses won't drop or cancel coverage. The most conspicuous went to McDonald's to protect the "mini-med" plans for some 30,000 hourly workers from a rule that prohibits annual restrictions on benefits. Mini-med policies offer modest coverage at low premiums and other low-wage fast-food chains like Jack in the Box and Denny's have been granted waivers as well.
Fed moves to close credit card loophole that allows excessive fees
By Ylan Q. Mui - Washington Post
The Federal Reserve on Tuesday moved to stop credit card issuers from using a regulatory loophole to charge the most vulnerable customers exorbitant sign-up fees.
The proposed regulation is aimed squarely at "fee-harvester cards" targeted at consumers with poor credit histories. The cards carry interest rates as high as 79 percent and typically have limits of a few hundred dollars. They also come with hefty annual fees and other charges that can quickly eat up the available credit.
Shots fired at Pentagon building; officials search for clues
By Christy Goodman and Maria Glod - Washington Post Staff Writers
Authorities searched Tuesday for a gunman who fired shots at the Pentagon in the early morning, possibly using a high-powered rifle. No one was injured.
The shots were fired shortly before 5 a.m., shattering, but not penetrating, windows on the third and fourth floors, officials said. They also said the walls of the building may have been struck.
"Right now, we are considering this a random event," said Pentagon Force Protection Agency Director Steven E. Calvery. "We can only process what we have."
Freedom Watch Part 1 -
Will Delaware Be The First Marxist State
Freedom Watch Part 2 -
Will Delaware Be The First Marxist State
Freedom Watch Part 3 -
Will Delaware Be The First Marxist State
OPEC Members Seek $100 Oil to Counter Dollar Weakness
By Grant Smith and Fred Pals
Oct. 15 (Bloomberg) -- The 13 percent decline in the Dollar Index since June has led some OPEC members to call for oil to rise to $100 a barrel.
The U.S. currency's weakness means the "real price" of oil is about $20 less than current levels, Venezuelan Energy and Oil Minister Rafael Ramirez said after yesterday's meeting of the Organization of Petroleum Exporting Countries in Vienna. The group, which accounts for 40 percent of global crude output, left targets unchanged and called for greater adherence to quotas, which are being exceeded by a supertanker load a day.
Can the Fed Fix the Economy?
By Robert Samuelson - RealClearmarkets.com
It is widely, though not universally, assumed that the Federal Reserve will soon move to bolster the economy by trying to nudge down long-term interest rates on Treasury bonds, home mortgages and corporate bonds. Just how much rates would decline and how much production and employment would increase are uncertain. What's clearer is that the move would be something of an act of desperation, reflecting a poverty of good ideas to resuscitate the economy.
Financial Collapse Jim Willie
The Real Horror Story: The U.S. Economic Meltdown
TheEconomicCollapseBlog.com
This October, millions of Americans are going to watch horror movies and read horror stories because they enjoy being frightened. Well, if you really want to be scared, you should just check out the real horror story unfolding right before our eyes - the U.S. economic meltdown. It seems like more bad news for the U.S. economy comes out almost every single day now. Unfortunately, things are about to get a whole lot worse. The mainstream media has been treating "Foreclosuregate" as if it is a minor nuisance, but the truth is that the lid is about to be publicly lifted on years and years of massive fraud in the U.S. mortgage industry, and this thing has the potential to cause economic chaos that is absolutely unprecedented. Over the past several days, expert after expert has been coming forward and warning that this crisis could completely and totally paralyze the mortgage industry in the United States. If that happens, it will be essentially like pulling the plug on the U.S. economic recovery.
NIA Releases Trailer for 'End of Liberty'
The National Inflation Association (NIA) has now released a 2-minute trailer for 'End of Liberty', NIA's new documentary coming at the end of October. 'End of Liberty' is the most eye-opening film ever produced about the United States government. The film would be funny if it wasn't so true. It promises to be the most important movie you will ever watch in your entire life.
'End of Liberty' exposes from a real life perspective how the U.S. is headed for a complete societal collapse. All Americans are now experiencing countless warning signs on a daily basis that a societal collapse is near. Unfortunately, most Americans don't understand the significance of these warning signs. Each warning sign by itself doesn't appear to have a lot of meaning, but together these warning signs present a very detailed picture of the current state of the U.S. economy and where this country is soon headed.
End of Liberty Trailer
Bill Isaac Vs. Hank Paulson's Bailout Machine
How The Former Fdic Chairman Almost Stopped Tarp
By Dr. Pitchfork - The DailyBail.com
Bill Isaac was Chairman of the FDIC from 1981-1985 during one of the most tumultuous decades in American banking. He oversaw the banking system during the Latin American debt crisis and the severe recessions of the early 1980's, and tried -- against enormous political pressure -- to head off the looming S&L crisis before it got worse. As many know, the S&L clean-up cost taxpayers hundreds of billions of dollars, but had Congress taken Isaac's prescient advice earlier in the decade, the ultimate costs would have only been an estimated $2B.
Fast forward to 2008. On September 18, Paulson and Bernanke had convinced the Congressional leadership that a bank bailout plan had to be passed immediately or else the entire global economy would collapse.
The Next Big Short: U.S. Treasury Bonds
by Eric Englund - LewRockwell.com
After reading Michael Lewis' wonderful book The Big Short: Inside the Doomsday Machine, I recommended it to a friend. As my friend is a financial professional, I knew he would enjoy a book about how a few obscure hedge fund managers, and their clients, handsomely profited from the collapse of America's subprime-mortgage market. This friend knew that, starting in June of 2005, I had written extensively about the United States' housing bubble (see articles, here, here, here, here, here, here, and here). So the meltdown in the subprime-mortgage market came as no surprise to either of us; but it definitely caught Wall Street by surprise. Upon finishing the aforementioned book, my friend called me and asked a thought-provoking, two-part question: "What is the next big short and how do we profit from it?"
Gold Explodes After Bernanke Gives QE2 Green Light: "Sees Case For Further Action"
by Tyler Durden - ZeroHedge.com
More broken gospel from the Central Bank of faith and hope, as gold surges, despite what anti-gold bugs out there preach day in and out:
Fed's Bernanke says sees case for further action with too low inflation
Fed's Bernanke says Fed could buy assets, alter statement
Fed's Bernanke says hard to determine pace, size of any purchases, must weigh costs, benefits in deciding how aggressive to be
Fed's Bernanke says Fed has tools to ease when rates near zero, earlier bond-buying was successful in lowering long-term rates
Fed's Bernanke says risk deflation is higher than desirable, unemployment clearly too high
Fed's Bernanke says at current rates of inflation, short-term real interest rates are too high
Fed's Bernanke says unemployment to decline slowly, prolonged high unemployment would pose risk to sustainability of recovery
Jim Sinclair: The top callers in gold have been wrong for eight years
GATA.org
Gold trader and mining executive Jim Sinclair today told Eric King of King World News that the top callers in gold have been wrong for eight years and they're wrong again now. Right or wrong on a top now, some of the top callers indeed have been advising against buying gold for the last thousand dollars up -- and somehow they still get interviewed as experts by the mainstream financial news media. Well, they'll get it right someday -- if they're still young.
Silver prices up, risk too
LONDON (Commodity Online): Silver has been a total gainer this year but it rarely hogged headlines because of its more renowned cousin gold making waves across the world.
While gold has grabbed headlines this year with its rally to record highs above $1,385 an ounce, silver has quietly outpaced those gains. A $100 investment in silver on January 1 would now be worth around $146, versus a gold investment's $126.
The prospect of further monetary easing in major economies has favoured the metal on two fronts. It rises with gold as an investment vehicle and alternative to paper currencies, while also benefiting from greater demand for industrial commodities.
What exactly is a currency war, anyway?
Posted by Nin-Hai Tseng, reporter - Fortune
Currency volatility is certainly a problem, but no one's quite sure if we'll know when it becomes a full-blown war.
Tensions are escalating among some of the world's biggest economies as finance ministers find incentives to devalue their currencies. But are we in a currency war, or merely a currency spat?
Treasury Secretary Tim Geithner says unequivocally it is not a war. He told Charlie Rose last week there is "no risk" of the current strife escalating to a currency war. But Brazilian Finance Minister Guido Mantega disagrees -- last month he publicly said an "international currency war" has broken out.
Keiser Report No.86:
Marc Faber Sees Interest Rates, Dollar Rising in Key Market Reversal Marc Faber the Swiss fund manager and Gloom Boom & Doom editor believes global markets are heading for an "important turning point" as interest rates begin to rise within about three months and the US dollar gains
Speaking to reporters Tuesday during the World Knowledge Forum in Seoul, Faber said investors should buy stocks and sell bonds as a new round of quantitative easing may create a new 'credit bubble'.
"Instead of interest rates going down, they could start to go up, instead of the dollar being weak, it could strengthen," Bloomberg quoted Faber as saying. "I'm ultra-bearish on everything, but I believe you'll be better off owning shares than government bonds."
Banks Shared Clients' Profits, but Not Losses
By LOUISE STORY - NYTimes.com JPMorgan Chase & Company has a proposition for the mutual funds and pension funds that oversee many Americans' savings: Heads, we win together. Tails, you lose - alone.
Here is the deal: Funds lend some of their stocks and bonds to Wall Street, in return for cash that banks like JPMorgan then invest. If the trades do well, the bank takes a cut of the profits. If the trades do poorly, the funds absorb all of the losses.
The strategy is called securities lending, a practice that is thriving even though some investments linked to it were virtually wiped out during the financial panic of 2008. These trades were supposed to be safe enough to make a little extra money at little risk.
What Can We Expect Next from the Bernanke Fed?
Mises Daily: by Roger W. Garrison
On October 15, Ben Bernanke spoke at the Boston Fed's conference, "Monetary Policy in a Low-Inflation Environment." His remarks were long and ponderous and consisted mostly of "Fedspeak" along with seeming excerpts from a typical intermediate-macroeconomics textbook. He rehashed the Fed's statutory mandate of maximum employment and price stability - which comes from the Keynes-inspired Full Employment Act of 1946. He explained that the two goals compete for the Fed's attention, which means that neither goal can be pursued singlemindedly. In the short run, advancing on one front may entail retreating on the other. In the long run, the Fed must be content to focus on the issue of price stability. The long-run level of employment is determined by real forces in the marketplace and not by central-bank policy.
Banks Face Mortgage Scrutiny as $49 Billion in Value Vanishes
By Dakin Campbell
Oct. 18 (Bloomberg) -- Citigroup Inc., Bank of America Corp. and Wells Fargo & Co., set to report earnings this week, face investors groping for answers after evidence of flawed foreclosure documents triggered a selloff of U.S. bank stocks.
The banks plus JPMorgan Chase & Co. saw $49.3 billion in market value shaved off in the three days ended Oct. 15 amid concern that rising costs of faulty foreclosures will eat into profits. JPMorgan set aside $2.3 billion of reserves to cover mortgage repurchases or litigation expenses, including some for "mortgage-related matters," the lender said Oct. 13.
Law Expert: MERS Mess Could Have "a Massive Effect on the Economy."
By: David Dayen - FDL News
So I had a pretty incredible conversation last night with Christopher Peterson, the law professor and Associate Dean for Academic Affairs at the University of Utah, who wrote two illuminating Law Review articles about MERS, the shell entity that created an electronic database for the trading of mortgages. I'm going to do my best to summarize the findings of the interview, but I want to stress two things that I learned - 1) this is very heady stuff, tied up in contract law and all sorts of associated legal issues, 2) absolutely nobody in this country knows with any certainty how this is going to play out.
The Fed's Coming Moves Will Likely Make for a More Volatile Market
By DAN BURROWS - DailyFinance.com
Strong third-quarter earnings and a weaker dollar helped the Dow to a nifty 3% rally in the last couple of weeks, but don't be surprised if further gains are harder to come by in the days ahead, says Joe Greco, managing director at Meridian Equity Partners.
Volatility started to pick up in the last few sessions, and now that a downbeat Federal Reserve Chairman Ben Bernanke has made another round of stimulus all but certain, the market is "beginning to realize that there are some bigger issues coming to fruition," Greco says.
The Biggest Bank Robbery In History? More Quantitative Easing = Backdoor Bailouts For The Big Banks Without Having To Go Through Congress
TheEconomicCollapseBlog.com
The U.S. Federal Reserve is getting ready to conduct another gigantic bailout of the big banks, but this time virtually nobody in the mainstream media will use the term "bailout" and the American people are going to get a lot less upset about it. You see, one lesson that was learned during the last round of bank bailouts was that the American people really, really do not like it when the U.S. Congress votes to give money to the big banks. So this time, the financial "powers that be" have figured out a way around that. Instead of going through the massive headache of dealing with the U.S. Congress, the Federal Reserve is simply going to print money and give it directly to the banks. To be more precise, the Federal Reserve is going to use a procedure known as "quantitative easing" to print money out of thin air in order to purchase large quantities of "troubled assets" (such as mortgage-backed securities) from the biggest U.S. banks at well above market price. Some are already openly wondering if this next round of quantitative easing is going to be the biggest bank robbery in history. Most Americans won't understand these "backdoor bailouts" well enough to get upset about them, but that doesn't mean that they won't be just as bad (or even worse) than the last round of bailouts. In the end, all of the inflation that this new round of quantitative easing is going to cause is going to be a "hidden tax" on all of us.
Geithner Says Countries Can't Devalue to Prosperity
By Ian Katz
Oct. 18 (Bloomberg) -- Treasury Secretary Timothy F. Geithner said countries can't devalue their currencies to achieve economic growth, and the U.S. envisions the dollar will remain the global reserve currency.
"The United States of America and no country around the world can devalue its way to prosperity, to competitiveness," Geithner said today in a panel discussion in Palo Alto, California. "It is not a viable, feasible strategy and we will not engage in it." He also said the U.S. will "work very hard to make sure that we preserve confidence in a strong dollar."
Gerald Celente: We're Living on Borrowed Time - Alex Jones Tv 7/7
Benny & the debt Bernanke could be replaying '70s tune
By GREGORY BRESIGER - NYPost.com
Remember disco? Well, that wasn't the worst thing about the 1970s.
Stagflation spurred by dirt-cheap interest rates was the low point of the "Me Decade."
And critics of the Federal Reserve say the present-day actions of Fed chief Ben Bernanke could bring the bad old days back. How? With the latest quantitative-easing plan, which the central bank outlined in its minutes from the September meeting released last week.
As Bernanke reiterated on Friday, he believes inflation levels are far too low to spur economic growth.
Deficit tops $1 trillion again
By Jeanne Sahadi,
NEW YORK (CNNMoney.com) -- The United States racked up a $1.29 trillion deficit in fiscal year 2010, the federal government said Friday.
While that is historically high, it's not as high as the $1.42 trillion registered for 2009, which was the largest on record as a percentage of the economy since 1945. In real dollar terms, the 2009 gap was the largest ever.
The deficit for fiscal 2010, which ended Sept. 30, represented 8.9% of the economy. By comparison, at the height of World War II in 1943, the deficit equaled 30.3% of the economy.
It's Official: Obama Has Now Borrowed $3 Trillion
By Terence P. Jeffrey It's official: The Obama administration has now borrowed $3 trillion, according to the U.S. Treasury Department.
It took from 1776, when the United States became an independent country, until 1990, the year after the Berlin Wall fell signaling victory in the Cold War, for the federal government to accumulate a total of $3 trillion in debt, according to the Treasury Department. It only took from Jan. 20, 2009, the day President Barack Obama was inaugurated, until Oct. 15, 2010, for the Obama administration to add $3 trillion to the federal debt.
"The Great Dollar Devaluation Disaster" is Only Just Beginning and the Intended Victim is YOU!
Munkee.com I'm mad as hell about the shellacking our government has planned for you ... for me ... and for millions of other honest, hard-working Americans ... and I absolutely refuse to stay silent while good people are stripped of their life savings, investments and even the retirement funds that are due to them ... and by our own leaders.
So says Larry Edelson's (www.uncommonwisdomdaily.com) in an article* which Lorimer Wilson, editor of www.munKNEE.com, has reformatted into edited [...] excerpts below for the sake of clarity and brevity to ensure a fast and easy read. (Please note that this paragraph must be included in any article reposting to avoid copyright infringement.) Edelson goes on to say:
If it's hard for you to believe that our own leaders have turned on us - that they are intentionally attacking your wealth and financial independence and that they have already begun executing their plan - I certainly understand but please - for your own sake and for your family's safety - hear me out.
The Perfect Storm That Threatens American Democracy
Robert Reich - HuffingtonPost.com
It's a perfect storm. And I'm not talking about the impending dangers facing Democrats. I'm talking about the dangers facing our democracy.
First, income in America is now more concentrated in fewer hands than it's been in 80 years. Almost a quarter of total income generated in the United States is going to the top 1 percent of Americans.
The top one-tenth of one percent of Americans now earn as much as the bottom 120 million of us.
Who are these people? With the exception of a few entrepreneurs like Bill Gates, they're top executives of big corporations and Wall Street, hedge fund managers, and private equity managers. They include the Koch brothers, whose wealth increased by billions last year, and who are now funding tea party candidates across the nation.
Banks deny half of small business credit requests
By Ronald D. Orol, MarketWatch
WASHINGTON (MarketWatch) - Roughly half the small businesses that apply for credit are turned down, according to a report released Monday.
The study was conducted by the Federal Reserve Bank of New York during June and July of 426 small-business owners. It found 59% of small businesses wanted credit, and half of those were denied.
In addition to the small businesses that got none of what they sought, about 75% of those surveyed said they received "some" or "none" of the credit they wanted.
"Until now, we've only heard anecdotally about difficulties for regional small businesses in obtaining credit without any numbers to confirm this," said Kausar Hamdani, senior vice president and community affairs officer at the New York Fed.
Gerald Celente on The Jeff Rense show 14 Oct 2010
How We Can Really Help Families
Shaun Donovan - U.S. Secretary for Housing and Urban Development
The recent revelations about foreclosure processing -- that some banks may be repossessing the homes of families improperly -- has rightly outraged the American people. The notion that many of the very same institutions that helped cause this housing crisis may well be making it worse is not only frustrating -- it's shameful.
No one should lose their home as a result of a bank mistake. No one. That is why the Obama Administration has a comprehensive review of the situation underway and will respond with the full force of the law where problems are found. The Financial Fraud Enforcement Task Force that President Obama established last November has made this issue priority number one. Bringing together more than 20 federal agencies, 94 US Attorney's Offices and dozens of state and local partners to form the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud, the Task Force is examining this issue and the Attorney General has said publicly that if it finds any wrongdoing the members of the task force will take the appropriate action. The Federal Housing Administration and Federal Housing Finance Agency have launched reviews to make sure servicers are in full compliance with the law. The Office of the Comptroller of the Currency has directed seven of the nation's largest servicers to review their foreclosure processes, fix the processing problems and determine whether there is specific harm that has been caused in individual cases.
Gerald Celente on The Alex Jones Show - Fri 10.15.2010
Aviation World at Odds Over Plane Loans
By JAD MOUAWAD and NICOLA CLARK - NYTimes.com
Back in the mid-1980s, Boeing and Airbus avoided a trade war by making a gentlemen's agreement not to seek government financing to sell planes in each other's home markets. The deal symbolized an aviation world dominated by the United States and Europe.
That world is a lot different now.
No longer can Airbus and Boeing count on being the biggest manufacturers of large airplanes. Manufacturers in Canada and Brazil are seeking to gain a foothold in this lucrative market. And not too far in the future, China, Japan and Russia will be competing as well.
At the same time, airlines from Asia and the Middle East that did not exist three decades ago, or were small players, are now vying for a much bigger piece of the global aviation market.
Putting Austrian Business-Cycle Theory to the Test
Mises Daily: by Robert P. Murphy
Paul Krugman is despairing of late, because a growing number of mainstream economists are adopting (versions of) Austrian business-cycle theory. The most recent convert is Minneapolis Fed president Narayana Kocherlakota.
Krugman uses the occasion to criticize what he derides as "the hangover theory" of economic slumps, in which high unemployment is necessary after an artificial boom. As happened with his earlier criticism of "the hangover theory," here too Krugman buttresses his Keynesian logic with a misguided appeal to the data.
Why the U.S. has Launched a New Financial World War And How the the Rest of the World Will Fight Back
By MICHAEL HUDSON - CounterPunch.org
What is to stop U.S. banks and their customers from creating $1 trillion, $10 trillion or even $50 trillion on their computer keyboards to buy up all the bonds and stocks in the world, along with all the land and other assets for sale in the hope of making capital gains and pocketing the arbitrage spreads by debt leveraging at less than 1 per cent interest cost? This is the game that is being played today.
Finance is the new form of warfare - without the expense of a military overhead and an occupation against unwilling hosts. It is a competition in credit creation to buy foreign resources, real estate, public and privatized infrastructure, bonds and corporate stock ownership. Who needs an army when you can obtain the usual objective (monetary wealth and asset appropriation) simply by financial means? All that is required is for central banks to accept dollar credit of depreciating international value in payment for local assets. Victory promises to go to whatever economy's banking system can create the most credit, using an army of computer keyboards to appropriate the world's resources. The key is to persuade foreign central banks to accept this electronic credit.
Washington State's Union Tax Bill Gates Sr. supports a state income tax on wealthy Washingtonians, but public unions are the real muscle behind the initiative. By William McGurn - WSJ.com
In Washington state, the fight over a proposed new income tax has been cast as a battle of the billionaires. In this narrative, the struggle is between wealthy people who believe in paying their fair share of taxes - and other wealthy people who do not.
Now, it's true that one of the world's richest men, Microsoft founder Bill Gates, supports the ballot initiative proposing this new tax (I-1098), and that his father has donated to the cause. It's also true that Microsoft's other co-founder, Paul Allen, Microsoft CEO Steve Ballmer, and Amazon.com founder and CEO Jeff Bezos have contributed to the other side. Yet while it all makes for good copy, the battle of the billionaires is a misnomer.
Why a Foreclosure Moratorium Is a Bad Idea A special bankruptcy law could help borrowers while letting housing markets clear.
By BARBARA NOVICK - WSJ.com
Attorneys general from all 50 states launched a joint investigation last week into allegations that mortgage-servicing companies submitted fraudulent documents and broke laws in foreclosure proceedings. Some lawmakers are calling for a national moratorium on foreclosures. In response, major mortgage servicers - including Ally Bank, Chase, Bank of America and PNC Financial Services - have announced a freeze on all foreclosures until internal investigations are completed.
While any fraudulent activity should of course be addressed, a comprehensive moratorium on all foreclosures will do more harm than good. For starters, it won't address the underlying issue - that thousands of homeowners can't make their mortgage payments. Postponing the resolution of these debts will actually prevent consumers from extricating themselves from loans they can't afford. Worse, a national foreclosure moratorium will exacerbate the housing-market crisis by increasing uncertainty and preventing supply and demand from reaching equilibrium.
ELIZABETH WARREN
"THIS IS A VERY BIG PROBLEM" On FORECLOSURE FRAUD
Housing mess: You can't stay if you don't pay
By Tami Luhby
NEW YORK (CNNMoney.com) -- Just because a lender screwed up your foreclosure paperwork doesn't mean that you get to stay in your house for free.
Of course, plenty of enterprising lawyers will try to tell distraught homeowners otherwise.
But the best that most delinquent borrowers can hope for is that the current flap over foreclosure documents will prompt financial institutions to grant more affordable loan modifications, experts said.
Even if the banks didn't have the paperwork required to foreclose, "that doesn't mean you'll get a free house at the end of the day," said Ira Rheingold, head of the National Association of Consumer Advocates. "There is no panacea here."
'Foreclosure Mill' Employees Got Gifts For Altering Documents
The Huffington Post | Ryan McCarthy
At a large Florida "foreclosure mill," a manager signed up to 1,000 documents a day without reading them and employees were given gifts to speed up foreclosure paperwork, according to depositions released today by the Florida Attorney General's Office.
The news, also reported by Tampa Online, comes as Bank of America, the nation's largest bank by assets, announcement that it would resume more than 100,000 foreclosures in 23 states after an internal investigation of its practices.
Florida authorities are investigating the law offices of David J. Stern over how it handled foreclosure paperwork. As the AP notes, Cheryl Salmons, an office manager at the law offices of David Stern, "would sign 500 files in the morning and another 500 files in the afternoon without reviewing them and with no witnesses," according to Kelly Scott, a former assistant at the firm.
Florida law firm ran 'foreclosure mill'
By Stephanie Armour and Thomas Frank, USA TODAY
Employees at a law firm that handled foreclosures for Freddie Mac and Fannie Mae changed thousands of documents and hid them in a room when company officials came to conduct audits, according to a sworn statement released Monday by the Florida attorney general.
The law office of David Stern also enjoyed a cozy relationship with Freddie Mac and Fannie Mae, paying for hotels, rental cars and food for officials from the two federally chartered companies when they visited the law firm, according to a statement by Kelly Scott, a former legal assistant at the firm.
Foreclosure Fraud: Wall Street Cheats the Middle Class Again
AlterNet / By Mike Lux
Once again the big Wall Street banks are wreaking havoc with our economy in order to come away with outlandish profits at the expense of poor and middle-class people.
I was heartened to see a group of Democratic Senators write this great letter to Ben Bernanke and administration officials on the foreclosure fraud issue. They came out strongly for several important things regarding homeowners' rights, and they framed the issue perfectly: this is not some minor technical problem regarding some mislaid paperwork in a few cases, this is fraud by bankers on a massive scale. Along with this letter, check out this great op-ed by Sen. Whitehouse on the subject.
Foreclosure Fraud:
$45T Victimization will Fundamentally Destabilize Real Estate
Foreclosures: Next shoe to drop for bank
By Paul R. La Monica - CNN.com
NEW YORK (CNNMoney.com) -- Bank stocks have been shellacked lately as investors worry about what impact the foreclosure scandal will have on the results for the nation's largest financial institutions.
Still, some fund managers think the market is overreacting and that the allegations of improper documentation for foreclosures and the resulting delay in some proceedings is not setting the stage for the next Bear Stearns or Lehman Brothers -- i.e. another major banking crisis.
foreclosure mess
Bank of America Plans to Resume Foreclosures
By NELSON D. SCHWARTZ - NYTimes.com
Curtailing a moratorium sooner than expected, Bank of America announced Monday that it would resume foreclosures by next week in 23 states where court approval is needed to go ahead.
The decision covers 102,000 mortgages. While the bank said it had found no evidence that foreclosures had been made in error, it said the foreclosure moratorium would remain in effect in the 27 states where a judicial proceeding is not required, as the review proceeds state by state.
Foreclosure Moratorium: Cracking Down on Liar Liens
Dean Baker - Co-Director of the Center for Economic and Policy Research
As we all know, there is a major philosophical divide in US politics. On the one hand, there are those who think it is the role of government to help ensure that the vast majority of the population can enjoy a decent standard of living. On the other side are those who believe the role of government is to transfer as much money as possible to the rich and powerful. The latter group seems to be calling the shots these days.
This is seen clearly in the "liar lien" scandal: the flood of short-order foreclosures that ignore standard legal procedures. The banks have been overwhelmed by the unprecedented volume of defaulting mortgages in the wake of the housing crash. Even under normal circumstances, foreclosure rates that in some areas exceed ten times normal levels would create an administrative nightmare.
Underwater Mortgages
By John Krainer and Stephen LeRoy
House prices have fallen approximately 30% from their peak in 2006, accompanied by a level of defaults and foreclosures without precedent in the post-World War II era. Many homeowners have mortgages with principal amounts higher than the market value of their properties. In general, though, the rational default point is below the "underwater" point where house price equals the remaining loan balance, and depends on prospects for future house price appreciation and borrower default costs.
[see maps- then and now]
Broke and Jobless: 85% of College Grads Moving Home
by Mac Slavo - SHTFPlan.com
In yet another sign of the times, 85% of college graduates surveyed have reported that they will be moving home after they get their degrees:
Stubbornly high unemployment - nearly 15% for those ages 20-24 - has made finding a job nearly impossible. And without a job, there's nowhere for these young adults to go but back to their old bedrooms, curfews and chore charts. Meet the boomerangers.
"This recession has hit young adults particularly hard," according to Rich Morin, senior editor at the Pew Research Center in DC.
So hard that a whopping 85% of college seniors planned to move back home with their parents after graduation last May, according to a poll by Twentysomething Inc., a marketing and research firm based in Philadelphia. That rate has steadily risen from 67% in 2006.
U.S. Charities See Sharp Decline in Donations
By HUGH COLLINS - DailyFinance.com
The biggest U.S. charities saw the sharpest decline in donations in 20 years in 2009, with donations down by an average of 11%, according to The Chronicle of Philanthropy.
Only four of the top 10 saw contributions rise last year. They were Catholic Charities USA, the AmeriCares Foundation, Feed the Children and World Vision. Catholic Charities USA saw a 66% increase in donations. United Way Worldwide, the Salvation Army and the American Cancer Society all saw donations fall.
Income Inequality: Too Big to Ignore
By ROBERT H. FRANK - NYTimes.com
PEOPLE often remember the past with exaggerated fondness. Sometimes, however, important aspects of life really were better in the old days.
During the three decades after World War II, for example, incomes in the United States rose rapidly and at about the same rate - almost 3 percent a year - for people at all income levels. America had an economically vibrant middle class. Roads and bridges were well maintained, and impressive new infrastructure was being built. People were optimistic.
Pilot to TSA: 'No Groping Me and No Naked Photos'
by Michael Roberts - LewRockwell.com
My name is Michael Roberts, and I am a pilot for ExpressJet Airlines, Inc., based in Houston (that is, I still am for the time being). This morning as I attempted to pass through the security line for my commute to work I was denied access to the secured area of the terminal building at Memphis International Airport. I have passed through the same line roughly once per week for the past four and a half years without incident. Today, however, the Transportation Security Administration (TSA) agents at this checkpoint were using one of the new Advanced Imaging Technology (AIT) systems that are currently being deployed at airports across the nation. These are the controversial devices featured by the media in recent months, albeit sparingly, which enable screeners to see beneath people's clothing to an extremely graphic and intrusive level of detail (virtual strip searching). Travelers refusing this indignity may instead be physically frisked by a government security agent until the agent is satisfied to release them on their way in what is being touted as an "alternative option" to AIT. The following is a somewhat hastily drafted account of my experience this morning.
Immigrant Workers Crowd Out U.S. Teens
By Alfred Tella - RealClearMarkets.com
The employment-population rate of teenagers has declined from 50 percent to 25 percent in a little more than 30 years. The teen labor force participation rate has declined by 40 percent. The teenage unemployment rate has drifted upward in this period, and of the teenagers who are currently in the labor force, one in four is jobless. Among the factors explaining these trends is immigration, legal and illegal.
Two recent studies provide convincing evidence that low-skilled immigrants cost U.S.-born teenagers jobs.
Almost half of likely voters view healthcare reform unfavorably
By Michael O'Brien - The Hill
Public support for healthcare reform ticked downward in October, suffering from an especially negative opinion among likely voters.
Almost half of likely voters in next month's elections said they have an unfavorable view of Democrats' signature legislation - a more negative take on healthcare reform than the general public.
Forty-nine percent of likely voters said they have an unfavorable opinion of the healthcare bill, according to the Kaiser Health Tracking Poll, compared to 39 percent who have a favorable opinion. Twelve percent of likely voters said they have no opinion.
The poll suggests that the voters who are most likely to turn out to vote in 15 days are voters who tend to be more against the healthcare bill, another factor pointing to a potentially difficult set of midterm elections for Democrats.
Justice Dept. Sues Michigan Blue Cross Over Pricing
By ROBERT PEAR - NYTimes.com
WASHINGTON - The Justice Department sued Blue Cross Blue Shield of Michigan on Monday, asserting that the company had violated antitrust laws and secured a huge competitive advantage by forcing hospitals to charge higher prices to other health insurers in the state.
The civil case appears to have broad implications, because many local insurance markets, like those in Michigan, are highly concentrated, and Blue Cross and Blue Shield plans are often dominant.
In the Michigan case, the Obama administration charged that Blue Cross Blue Shield had contracts with many hospitals that stifled competition, resulting in higher health insurance premiums for consumers and employers.
Fox Steps Over the Internet Line; But There's Nothing To Be Done
Art Brodsky - Communications Director, Public Knowledge
Over the weekend, Fox committed what should be considered one of the grossest violations of the open Internet committed by a U.S. company. Unfortunately, there was no one to call them on it.
Two media giants, Fox and Cablevision, are embroiled in yet another of those disputes (retransmission consent) in which the company with content (in this case Fox) wants to raise the amount of money to be paid to it by the company with the distribution network (in this case Cablevision, with 3 million or so subscribers around New York City and Philadelphia).
Federal Agents Urged to 'Friend' People on Social Networks
FoxNews.com
A privacy watchdog has uncovered a government memo that encourages federal agents to befriend people on a variety of social networks, to take advantage of their readiness to share -- and to spy on them. In response to a Freedom of Information request, the government released a handful of documents, including a May 2008 memo detailing how social-networking sites are exploited by the Office of Fraud Detection and National Security (FDNS).
As of Thursday morning, Facebook, Twitter, MySpace, and Digg had not commented on the report, which details the official government program to spy via social networking. Other websites the government is spying on include Twitter, MySpace, Craigslist and Wikipedia, according to the Electronic Frontier Foundation (EFF), which filed the FOIA request.
China Spending $15 Billion on Electric Car Project
By DAVID SCHEPP - DailyFinance.com
Mindful of the ecological toll that gasoline and diesel engines exact on the environment, the Chinese government is pressing forward with plans to build 1 million electric vehicles a year by 2020, according to the Xinhua news agency.
Citing comments Saturday from the country's minister of science and technology, Wan Gang, Xinhua reported that environmentally friendly vehicles are essential for the development of the auto industry in China, where vehicle emissions account for 70% of the air pollution in major cities.
The Number One U.S. Export To China:
Waste Paper And Scrap Metal
TheEconomicCollapseBlog.com
Historians tell us that by the very end of the Roman Empire, goods were pouring into Rome from all over the known world, but about the only thing being sent out of Rome was human waste and garbage. America has not yet reached that point, but we are certainly well on our way. In 2010, the number one U.S. export to China is "scrap and trash". Yes, you read the correctly. The number one thing that China buys from us is our garbage. According to author Clyde Prestowitz, China's number one export to the U.S. is computer equipment (nearly $50 billion) while our number one export to them is waste paper and scrap metal (approximately $8 billion). When it comes to world trade, China is literally wiping the floor with the United States. In August, the U.S. trade deficit with China set a new one month record of $28 billion dollars. Our insane trade policies are making China (along with several of our other "trade partners") incredibly wealthy, and the U.S. government ends up begging China to lend that money back to us to fund the exploding U.S. national debt. That just isn't stupidity - that is insanity.
Gerald Celente on The Alex Jones Show - Fri 10.15.2010
Three Midwest Banks Fail
By Philip van Doorn - TheStreet.com
WASHINGTON (TheStreet) -- Regulators shut down two banks in Missouri and one in Kansas Friday, bringing the total number of U.S. bank failures for 2010 to 132.
The three bank failures cost the Federal Deposit Insurance Corp.'s deposit insurance fund a combined $507.8 million.
Security Savings Bank, FSB
The Office of Thrift Supervision closed Security Savings Bank, FSB of Olathe, Kan. and appointed the FDIC receiver. The FDIC then sold the failed institution's $508 million in total assets and $397 million in total deposits to Simmons First National Bank of Pine Bluff, Ark.
WestBridge Bank and Trust Company
State regulators in Missouri took over WestBridge Bank and Trust Company of Chesterfield. The FDIC was appointed receiver and sold the failed bank's $92 million in total assets and $73 million in total deposits to Midland States Bank of Effingham, Ill. The FDIC agreed to share in losses on $73 million of the acquired assets. The failed bank's office was scheduled to reopen as a branch of Midland States Bank on Monday. The FDIC estimated the cost of the bank failure would be $18.7 million
Disturbing Statistics on the Decline of America's Middle Class
By BRUCE WATSON - DailyFinance.com
In American public life, it's hard to escape the long shadow of the middle class. From politicians to pulpits to the punditocracy, those in the public eye constantly appeal to the solid center of the country.
Mainstream values are described as "middle class," as are common tastes and preferences. Economists often state that the middle class is the engine of commerce, and industries from construction to education to consumer electronics rely on a strong middle class -- with large amounts of disposable income -- to build colleges, fill houses and buy Blu-Ray players. But what if this massive engine ground to a halt?
Lies, Damn Lies and the ObamaCare Sales Pitch
By JOSEPH RAGO - WSJ.com Can the White House effort to defend ObamaCare get any more frantic, not to say desperate?
On Tuesday, Stephanie Cutter, a special assistant to President Obama, took to the White House blog to refute an ostensible health-care myth. "For months," she wrote categorically, "opponents of health reform have falsely claimed that the Affordable Care Act would lead to the taxation of health care benefits. The claim wasn't true when the rumor first surfaced, it isn't true today and it won't be true tomorrow."
That depends on how she defines "tomorrow." As former White House Budget Director Peter Orszag explained in his farewell address in July, "the legislation includes the most promising set of changes ever enacted into law to reduce the rate of health-care cost growth over the long term. These changes include a new excise tax on the highest-cost insurance plans. . . ."
How to avoid a debt doomsday
By Maya MacGuineas, CNNMoney Here is a scary question: What could trigger a full-blown fiscal crisis in the United States?
OK, now breathe. It is not at all clear that we will have one. There is the highly desirable possibility that policymakers will act preemptively and gradually phase in major entitlement reforms, spending cuts and tax reform.
You know the old Winston Churchill saying that Americans can always be depended on to do the right thing -- after exhausting all other alternatives. Well, there's still time.
And then there is the scenario one step removed from a full crisis: a Japan-style "lost decade" situation in which the economy muddles along. Job growth is lackluster for an extended period. Low interest rates allow Washington to keep borrowing. And the country gets stuck in an ineffective borrow and stimulate cycle with little to show for it other than more debt.
AND SO IT BEGINS GMAC, JEFFREY STEPHAN SUED BY VINDICTIVE HOMEOWNER
Posted by Foreclosure Fraud
In his complaint, filed in Common Pleas Court, Fox seeks at least $25,000 in compensatory damages and $25,000 in a civil penalty, plus undetermined punitive damages that his attorney said will be 2 percent of GMAC's 2009 gross revenue.
And so it begins. In one of the state's first lawsuits made by a distressed homeowner against a bank on the basis of alleged fraud during the foreclosure crisis, an Ohio man is out to get GMAC for knowingly presenting improperly-prepared paperwork in the process of his judicial foreclosure case. Yesterday, Michael Fox of Johnstown filed suit against GMAC Mortgage and Jeffrey Stephan, a bank employee who allegedly signed thousands of foreclosure affidavits without any actual knowledge of the cases therein. Stephan, who was deposed in January as part of a separate suit in Florida, admitted that during his tenure as a GMAC "robo-signer," he signed off on around ten thousand foreclosures a month without once looking at the paperwork.
Foreclosuregate: Time to Break Up the Too-Big-to-Fail Banks?
Courtesy of Ellen Brown - ZeroHedge.com With risky behavior by big finance again threatening economic stability, how can we get things right this time?
Although downplayed by most media accounts and popular financial analysts, crippling bank losses from foreclosure flaws appear to be imminent and unavoidable. The defects prompting the "RoboSigning Scandal" are not mere technicalities but are inherent to the securitization process. They cannot be cured. This deep-seated fraud is already explicitly outlined in publicly available lawsuits.
There is, however, no need to panic, no need for TARP II, and no need for legislation to further conceal the fraud and push the inevitable failure of the too-big-to-fail banks into the future.
Homeowners in Limbo Mortgage Mess Means Delays for Those Facing Foreclosure
By ROBIN SIDEL - WSJ.com
David Stiles was minutes away Tuesday from seeing his house sold in a foreclosure auction when he got a surprise phone call from his lawyer.
"I've got good news," said his lawyer, Pamela Simmons. GMAC Mortgage, which loaned him $333,700, had called off the sale. The reason: The lender decided to review its foreclosure cases because of mounting industrywide concerns about shoddy procedures used in document preparation.
Across the U.S., the mortgage mess is deepening the anxiety and uncertainty swirling around homeowners who are facing foreclosure. Foreclosure is already a slow process, but the decision by lenders such as Bank of America Corp. and J.P. Morgan Chase & Co. to halt most or all foreclosure sales and internal scrutiny by other financial institutions likely will keep many troubled borrowers in their homes for weeks or even months longer.
Mortgage Damage Spreads Big Bank Stocks Hit Again as Modern Finance Collides With the Legal System
By NICK TIMIRAOS, JESSICA SILVER-GREENBERG And DAN FITZPATRICK - WSJ.com
The unfolding foreclosure-processing debacle is causing bank stocks to slide and putting millions of delinquent borrowers in limbo.
But how disruptive the crisis ultimately becomes - for homeowners, the housing market and the broader economy - depends on how quickly a number of technical problems and legal challenges are resolved in the months ahead.
In essence, fast-paced modern finance is colliding with the much slower machinery of the U.S. legal system. While finance aims for efficiency and maximized profits, the courts demand due process. And that's becoming a growing issue as lenders come under attack for taking short cuts to oust homeowners who haven't mailed in a mortgage check for months.
Dollar continues to direct Gold
By Debbie Carlson of Kitco News - ComodityOnline.com
(Kitco News) - The inverse relationship the dollar and gold have should continue next week, with analysts watching for any change in the dollar weakness as a troubling sign for gold.
The weakness of the dollar has helped propel gold to new highs, but the yellow metal has exhibited some shakiness when the dollar has paused in its recent descent, which is why many analysts are on the lookout for any rebound in the dollar to nick at gold's rise. The same can be said for silver, which has also had significant gains on dollar weakness. On the Comex division of the New York Mercantile Exchange, December gold futures rose 2% on the week to $1,372 an ounce, while December silver gained 5% to $24.288 an ounce.
Pension Funds venture into Commodities, Gold
By Debbie Carlson of Kitco News - ComodityOnline.com
(Kitco News) - Investment funds have dabbled in commodities for several years as prices boomed, but even more traditional-minded institutions such as pension funds are now dipping their toes in the water.
So far, these funds are allocating only a tiny portion of their portfolios to commodities, including gold. Still, this is enough money to contribute to rising prices, even if supply/demand fundamentals for some commodities, such as food items, do not always justify the rise.
This, in turn, has led to some concerns that these fund flows have the potential to disrupt pricing on some resources, such as food products.
Dollar fall sparks stability warnings
By David Oakley, Peter Garnham, Michael Mackenzie - FT.com
The dollar tumbled against most major currencies on Thursday, prompting warnings that the weakness of the world's reserve currency could destabilise the global economy and push other countries into retaliatory devaluations to underwrite their exports.
Increasing expectations the Federal Reserve will pump more money into the US economy next month under a policy known as quantitative easing sent the dollar to new lows against the Chinese renminbi, Swiss franc and Australian dollar. It dropped to a 15-year low against the yen and an eight-month low against the euro.
The dollar index, which tracks a basket of currencies, reached its lowest level this year.
Currency wars: China buying time China is being pressed to revalue the yuan; Thailand has imposed limits on money flows into Thailand; Brazil is appealing for an end to competitive devaluations ... the currency war between China and the USA will have disturbing political repercussions
Tony Curzon Price and Charles Diamond - OpenDemocracy.net
Wen Jiabao, Chinese premier, said last week to an audience of European business people: "If we increase the yuan by 20 percent-40 percent as some people are calling for, many of our factories will shut down and society will be in turmoil. If China's economy goes down, it's not good for the world economy."
True, but not much of a threat in a negotiation when the first to suffer will be the Chinese Communist Party.
China has prospered by building an export-oriented economy. But China's growth has depended on US households, aided by irresponsible financiers, acting as "consumers of last resort". The US needs to consume less.
CURRENCY WARS: Misguided US Economic Policy
Gordon T. Long - GoldSeek.com
The critical issues in America stem from minimally a blatantly ineffective public policy, but overridingly a failed and destructive Economic Policy. These policy errors are directly responsible for the opening salvos of the Currency War clouds now looming overhead.
Don't be fooled for a minute. The issue of Yuan devaluation is a political distraction from the real issue - a failure of US policy leadership. In my opinion the US Fiscal and Monetary policies are misguided. They are wrong! I wrote a 66 page thesis paper entitled "Extend & Pretend" in the fall of 2009 detailing why the proposed Keynesian policy direction was flawed and why it would fail. I additionally authored a full series of articles from January through August in a broadly published series entitled "Extend & Pretend" detailing the predicted failures as they unfolded. Don't let anyone tell you that what has happened was not fully predictable!
White House tries to juggle China with Voters Balancing Act Tried With China
By BOB DAVIS and ELIZABETH WILLIAMSON - WSJ.com
The Obama administration, employing a good-cop, bad-cop approach to China, applauded Beijing's recent currency moves but opened a new fight over whether the Chinese improperly subsidize clean-technology manufacturers.
The moves were coordinated at the White House, which is balancing conflicting international and domestic interests. It wants to encourage Beijing to change its policies while convincing voters at home that it isn't soft on Chinese trade practices that voters suspect take U.S. jobs.
America's Unhealthy Obsession With the Chinese Exchange Rate
Written by Avinash D Persaud - OilPrice.com
The US obsession with the Chinese exchange rate is a classic example of blaming foreigners for domestic woes. And we've been here before. In the 1980s, the US government - reacting to political pressure from ailing US manufacturers - engineered a massive yen appreciation. That did as little to save US manufacturing jobs then as a rise in the yuan would do today.
"Blame foreigners for domestic woe" is the sad but unsurprising cardinal rule of politics, followed by even the most ardent internationalist. After seven years of a consumption binge in the US, evidenced by a negative personal savings rates, excessive leverage, historically high employment levels and record international deficits, commentators in the world's largest economy did not conclude what every macroeconomic model indicated - that US fiscal and monetary policy were too loose. Instead, in a manner reminiscent of the Dreyfus Affair, China is being convicted of manipulating its exchange rate and Asia for saving too much.
Fed's Evans: U.S. in 'Bona Fide Liquidity Trap'
By MICHAEL S. DERBY - WSJ.com
BOSTON - The Federal Reserve may have to let inflation overshoot levels consistent with price stability as part of a broader attempt to help stimulate the economy, a U.S. central bank official said Saturday.
"The U.S. economy is best described as being in a bona fide liquidity trap," and given the challenges now faced by the nation, "much more policy accommodation is appropriate today," Federal Reserve Bank of Chicago President Charles Evans said.
His comments came from the text of a speech prepared for delivery to a conference on monetary policy held by the Boston Fed, involving Fed employees, academics and Wall Streeters.
What Conflict of Interest? How Power Blinds Us to Our Flaws
By Jason Zweig - WSJ.com Why do powerful people with so much to lose push so hard to squeeze out a little more gain for themselves?
That question lingers after The Wall Street Journal's series of articles about securities trading by members of Congress and their aides. As the Journal has shown, dozens of public servants on Capitol Hill (and sometimes their spouses) actively traded during the financial crisis-buying funds that profit in a falling stock market, using options to bet against shares of home-building companies, even trading in and out of stocks that stood to benefit from government interventions they helped oversee.
Such trades are legal, since prohibitions on insider trading generally don't apply to Congress. All the members of Congress and staffers involved in the trades have told the Journal that they adhered to the relevant codes of ethics and complied with all requirements for public disclosure.
US delays China currency report
By Martin Crutsinger, AP Economics Writer
WASHINGTON - The Obama administration announced Friday it will delay a scheduled report on whether China is manipulating its currency to gain trade advantages until after an upcoming meeting of the world's major economies next month.
The Treasury Department said the administration will wait until after President Obama meets with other leaders of the Group of 20 nations in Seoul in early November.
U.S. must balance selling to China with currency concerns
By Kathy Chu, USA TODAY
GUANGZHOU, China - At an upscale department store in China's third-largest city, Almond Roca candy from Washington competes with traditional Chinese sweets. Supermarkets here sell Washington apples and cherries. And the state's Boeing planes crowd the skies.
As the global economic malaise drags on, and the U.S. seeks to reduce its reliance on the debt-fueled consumption that triggered the financial crisis, exports are becoming increasingly important to the nation's growth. China is now the third-largest export market for the U.S. - behind Canada and Mexico - and the fastest-growing. From 2000 to 2009, exports to China surged 330% while exports to the rest of the world rose 29%, U.S. Department of Commerce figures show.
Not your grandfather's deflation As the Fed frets over the prospect of an overall decline in the price of goods and services, signs of rising prices abound.
By Bill Fleckenstein - MSN Money
Who's afraid of big, bad deflation? It seems like almost everyone, but none more influential at the moment than Federal Reserve Chairman Ben Bernanke.
Given the policy implications of Bernanke's fears (i.e., more money printing), it is worth understanding what his reasoning might be, flawed though it ultimately is.
Inflated worries
In assessing Bernanke, it is important to realize that he has spent a great deal of his academic life studying the Great Depression and is considered by many to be an expert on that period. As such, part of the reason he may be so afraid of deflation is because he assumes -- as many people do -- that deflation equals an economic depression.
Bernanke signals Fed will pump cash into the economy
By Jeannine Aversa, AP Economics Writer
WASHINGTON - Federal Reserve Chairman Ben Bernanke says the central bank is prepared to take steps to rejuvenate the economy by buying government bonds but is wrestling with how big the program should be.
"There would appear - all else being equal - to be a case for further action," Bernanke said Friday in a speech to a conference at the Federal Reserve Bank of Boston.
Stocks and stock futures mostly rose after Bernanke's remarks. But the prospect of more dollars swirling around the financial system didn't help the dollar, which slid against most currencies after his remarks.
September's 0.1% CPI Has the Fed on Deflation Alert
By JOSEPH LAZZARO - DailyFinance.com
If any investors think the massive fiscal and monetary stimulus has triggered inflation in the U.S., they should study the September consumer price report, which indicated that consumer prices rose just 0.1% -- less than expected. And the core rate -- which excludes the often-volatile food and energy component -- was unchanged.
A Bloomberg survey had expected September's consumer prices to rise 0.2% and the core rate to tick 0.1% higher, after an 0.3% overall rise in August (when the core rate lifted by a scant 0.1%). July's CPI rose 0.3%, after falling 0.1% and 0.2% in June and May, respectively.
However, the current flatness in prices isn't what the U.S. Federal Reserve -- the public institution most responsible for price stability -- wants to see. It actually would prefer a little more inflation in the economy.
The Ugly Truth about the economy In this recovery, Washington has less power over the economy than you think
By Allan Sloan, Tory Newmyer and Doris Burke - Fortune
Let us tell you an Ugly Truth about the economy, a truth that no one in power or who aspires to power wants to share with you, at least until after the midterm elections are over. It's this: There is nothing that the U.S. government or the Federal Reserve or tax cutters can do to make our economic pain vanish overnight. There are no all-powerful, all-knowing superheroes or supervillains who can rescue or tank the economy all by themselves.
From listening to what passes for public debate in our country, you'd never know that. You'd think that the federal government could revive the economy quickly if only Congress would let it be more aggressive with stimulus spending. Or that the Fed could fix it if only it weren't overly worried about touching off inflation. Or that the free market could fix it if only we made deep and permanent tax cuts.
Deficit tops $1 trillion second year in a row
By Jeanne Sahadi
NEW YORK (CNNMoney.com) -- The United States racked up a $1.29 trillion deficit in fiscal year 2010, the federal government said Friday.
While that is historically high, it's not as high as the $1.42 trillion registered for 2009, which was the largest on record as a percentage of the economy since 1945. In real dollar terms, the 2009 gap was the largest ever.
The deficit for fiscal 2010, which ended Sept. 30, represented 8.9% of the economy. By comparison, at the height of World War II in 1943, the deficit equaled 30.3% of the economy.
A Big Tax Hit For Dividends
By JONNELLE MARTE - WSJ.com
If the Bush tax cuts are allowed to expire at the end of the year, stock dividends will be subject to a much higher tax.
So some financial advisers say it may be time to review the investments you have in taxable accounts and consider holding a larger portion of high-paying dividend stocks in a tax-deferred account, such as an individual retirement account or a 401(k).
Right now, the tax on stock dividends typically is a maximum 15%. But if the tax cuts expire and we revert to previous levels, dividends would be subject to an income-tax rate of as much as 39.6%.
Estate-Tax Rises Again as Issue on Trail
By JOHN D. MCKINNON - WSJ.com
A move to end the estate-tax is luring new adherents in the 2010 midterm campaign, turning permanent repeal into a negotiating stance for future congressional wrangling over taxes.
More than 250 current congressional candidates, mostly Republicans, have signed a pledge this year to support elimination of the tax, according to the advocacy group sponsoring the effort. The signers include 53 incumbents and more than half of Republicans running for House and Senate. During the 2008 elections, when the group first began seeking supporters, only 30 candidates signed up.
The estate tax has become a particularly hot issue in the West, including in Washington state's Senate contest, and some rural House districts where Democratic incumbents appear vulnerable. The tax tends to be a hotter issue in rural areas because it raises particular concerns among farmers and landowners.
Former construction supervisor is a casualty of the housing bubble In the year since he was laid off from overseeing high-end apartment projects, San Diego resident Bernie Doyle has fallen behind on child-support payments, owes back taxes and has run up credit card debt.
By Stuart Pfeifer, Los Angeles Times
Before the bottom dropped out of the housing market, Bernie Doyle was working hard and riding high.
A construction supervisor on high-end apartment projects in San Diego, he worked 12-hour days and was constantly under the gun. But the rewards were worth it. He made nearly $90,000 a year, enough to buy a 26-foot boat that he and his wife, Suz'Ette, took out nearly every weekend. And he had a sense of pride each time he finished a job on schedule.
"They'll slap me on a job and it's nothing but bare dirt. By the time I leave, the thing is built," said Doyle, his voice still tinged with a New England accent. "I love it. I live it. I like the pressure. I like dealing with people. I like getting the job done on time."
Laid off last summer, Doyle at first figured he'd be called back within a couple of months. But the hangover from the nation's housing binge is likely to last for years. He figures he has applied for more than 100 jobs, lowering his sights and salary demands drastically. He has sought work as a handyman for an apartment building and as a Home Depot salesman. Nothing.
How Countrywide Covered the Cracks
By GRETCHEN MORGENSON - NYTimes.com
ON June 27, 2006, Countrywide Financial, the nation's largest mortgage lender, was about to close its books on a record-breaking six-month run. The housing market was on fire and Countrywide's earnings were soaring. Despite all the euphoria inside the company, some executives noticed that Angelo R. Mozilo, the company's brash and imperious chief executive, seemed subdued.
At a town hall meeting that day with 110 of the company's highest-ranking executives in Calabasas, Calif., Mr. Mozilo sat alone on a stage, fielding questions and offering rosy predictions about his company's prospects. But then he struck a sober note in response to a question from one of his colleagues.
The Subprime Debacle: Act 2
By: John Mauldin - GoldSeek.com
.... There's trouble, my friends, and it is does indeed involve pool(s), but not in the pool hall. The real monster is hidden in those pools of subprime debt that have not gone away. When I first began writing and speaking about the coming subprime disaster, it was in late 2007 and early 2008. The subject was being dismissed in most polite circles. "The subprime problem," testified Ben Bernanke, "will be contained."
My early take? It would be a disaster for investors. I admit I did not see in January that it would bring down Lehman and trigger the worst banking crisis in 80 years, less than 18 months later. But it was clear that it would not be "contained." We had no idea.
FORECLOSUREGATE - AN OPEN LETTER TO PRESIDENT OBAMA
Dear President Obama,
I'm a centrist Democrat; many I work with are Democrats, but plenty are Republicans. Most of us are in our 30's and 40's, but plenty of us are older and plenty younger. Many of us are college graduates, but some have no degrees. Some are wealthy; many are poor. Some are decorated veterans and some never served in the military.
We work together for a common cause. On its face we are working to stop foreclosures but our genuine mission is deeper: we see the very fabric of our country being ripped apart and are working to protect it.
We have watched rocket dockets where lying lawyers use forged documents to argue to crooked and corrupt judges, who openly admit to having pre-judged cases. We regularly watch reckless, irresponsible, dishonest bankers who have benefited from $13 trillion in direct and indirect subsidies label their victims - people they lent money to knowing the borrowers did not understand the terms and could never repay - demean their victims while ignoring or even denying their own massive bailout.
Foreclosures Emerge as Hot Campaign Issue
By NAFTALI BENDAVID
The surge in foreclosure problems has set off a free-for-all on the campaign trail, pitting some Democratic candidates against their Republican opponents and even the White House.
Republicans are blaming the Democratic Congress for helping create the housing crisis by failing to rein in mortgage giants Fannie Mae and Freddie Mac. Some Democrats are pushing for a moratorium on foreclosures, a position at odds with the GOP and the White House, which is concerned such a move could damage the housing market's fragile recovery.
The issue seems to have particular resonance in areas harder hit by foreclosures.
For foreclosure processors hired by mortgage lenders,
speed equaled money
By Ariana Eunjung Cha and Zachary A. Goldfarb - Washington Post
Millions of homes have been seized by banks during the economic crisis through a mass production system of foreclosures that was set up to prioritize one thing over everything else: speed.
With 2 million homes in foreclosure and another 2.3 million seriously delinquent on their mortgages - the biggest logjam of distressed properties the market has ever seen - companies involved in the foreclosure process were paid to move cases quickly through the pipeline.
And the big mortgage companies overseeing it all - including government-owned Fannie Mae - were so eager to get bad loans off their books that they imposed a penalty on contractors if they moved too slowly.
Foreclosure procedures undergo extensive review
By Stephanie Armour, USA TODAY Recent revelations about mortgage lenders filing possibly faulty court papers to foreclose on homes has sparked a public outcry and called into question tens of thousands of foreclosures. Here's a look at the issue and its impact. Q: How did this come to light? A: Lawyers for homeowners fighting foreclosures took depositions from officials who prepare legal documents to get court approval to foreclose. The document signers - who have now been dubbed robo-signers - said they signed thousands of affidavits without reviewing the supporting papers or having the affidavits signed in the presence of a notary. Both are supposed to be done before foreclosure papers are submitted to courts in about 23 states that require judicial approval for all or most foreclosures. Some lawyers allege there were instances of fraud, too, including backdated documents and forged signatures.
Foreclosure processors say they didn't review much
By Stephanie Armour and Thomas Frank, USA TODAY
Workers who processed tens of thousands of mortgage foreclosure papers portrayed their jobs as assembly-line work that required them to sign off on documents without reviewing them.
The depositions - which are sworn statements given in lawsuits against servicers - were released this week by a Florida lawyer defending 3,000 homeowners in foreclosure cases. They are the latest evidence in a controversy over foreclosure practices that has led state officials and federal regulators to investigate whether foreclosure papers filed with courts were false or fraudulent.
So you bought a foreclosed home; now what?
By Dave Carpenter, Associated Press
It seemed too good to be true: You bought a house in foreclosure at a fraction of the former price. Maybe you even knocked out a wall or two and remodeled with all the money you saved.
But now thousands of foreclosures around the country may be invalid because of bank paperwork problems. Should you worry?
"Anyone who's purchased a foreclosed property in the last three years should really be concerned," says George Babcock, a Providence, R.I., attorney who represents homeowners who have been foreclosed on.
Robo-nothing: 9 documents you MUST read before signing
Tara-Nicholle Nelson - WalletPop.com
This recession has given birth to more new lingo than any other economic phenomenon in recent memory. We've had bailouts and frugalistas, ponzimonium and staycations, and now, I'm sure you've heard about the massive "robo-signing" scandal that is literally sweeping the entire nation.
But you may still wonder what exactly "robo-signing" is: staff members at some of America's largest mortgage lenders were tasked with signing 10,000 foreclosure documents per month, by hand. Given that they were also supposed to be reviewing the files and papers before they signed, that's just not humanly possible. Hence, the term "robo-signing," shorthand for simply signing extremely important documents without reading them.
As absolutely inexcusable as the banks' repossession of people's largest asset without verifying the documents is, the fact is that all of us "robo-sign" things without reading them on a daily basis.
Here are nine things you should not sign without reading:
The Great Mortgage Mystery
By Brett Arends - WSJ.com The big question from the mortgage meltdown isn't why so many distressed homeowners are defaulting on their loans. It's why any of them are still making payments.
In the worst-hit areas millions have no equity left, and little hope of seeing any anytime soon. The market value of their homes is far below the size of the mortgage.
If they just stop paying, what is going to happen to them? In many cases they may get to live in the home rent-free for months, even years, until the bank gets around to seizing it.
If Frank Abagnale - the con man played by Leonardo DiCaprio in the film "Catch Me If You Can" - were operating today, he'd probably be living rent-free in a super-luxury high-rise in Miami.
Consider the latest revelations. The big banks are so backed up with foreclosures that some of them resorted to hustling through repossessions without the proper paperwork. Some of them - including Bank of America, J.P. Morgan Chase and Ally Financial's GMAC Home Mortgage - have announced a temporary freeze in some states on further foreclosures while they sort through the mess.
State sues Payday Loan Store
for dumping sensitive customer data in trash
Stella M. Chavez - WalletPop.com
Sensitive and personal information of Payday Loan Store's customers ended up in the trash despite a company policy that promises to protect such data, according to a lawsuit filed by Illinois' attorney general.
The company, which sells high-interest, short-term loans, allegedly dumped the documents containing the information into trash bins outside four of its locations in the Chicago area, where Payday Loan Store is based.
"Data security is absolutely critical to protecting consumers from identity theft," Attorney General Lisa Madigan said in a statement. "Businesses that collect, use and ultimately dispose of sensitive personal information must live up to their promises to protect that information from unauthorized access in order to protect the financial privacy of consumers."
Seniors feel the pinch of no benefit increase
By Annalyn Censky
NEW YORK (CNNMoney.com) -- Inflation has barely budged in recent months, but try telling that to the seniors who won't be getting an increase in their Social Security benefits next year.
The government reported its consumer price index was up 1.1% over the last year, indicating inflation is still sluggish.
But with prices up on health care, food and other essentials, it sure won't seem that way to the 58 million retirees and disabled Americans who depend on Social Security checks.
After analyzing the latest inflation figures released Friday, the Social Security Administration announced it won't be giving out a cost-of-living adjustment, or COLA, to those folks in 2011.
Obamacare is killing recovery
By Armstrong Williams - The Washington Times
Six months ago, the Health Care Reform Act became law. Prior to its passage, House Speaker Nancy Pelosi condescendingly announced, "We have to pass the bill so that you can find out what is in it."
President Obama also assured Americans that health care "reforms ... will finally reduce the costs of health care. ... Families will save on their premiums."
Contrary to the president's assurance, unfortunately, the health care reform legislation is already causing a substantial increase in medical insurance premiums. We are also finding expensive provisions in this act that we did not know were there, including a hidden 3.8 percent tax on the sale of certain residential real estate and a burdensome Internal Revenue Service filing requirement on small businesses.
Eight Deadly Superbugs Lurking in Hospitals
By NIKHIL HUTHEESING - DailyFinance.com
Increasingly, the hospital is becoming a dangerous place to spend time. Even if you are there for surgery and all goes smoothly, a superbug could get you, with very serious, life-altering consequences -- including possibly death.
Superbugs -- bacteria strains resistant to antibiotics -- are on the rise. Today, according to Dr. Philip Tierno, Director of Clinical Microbiology and Immunology at the Langone Medical Center at New York University, there are 2.5 million infections annually worldwide which result in about 100,000 needless deaths and cost billions of dollars in additional treatments.
Long-Term-Care Premiums Soar
By ANNE TERGESEN and LESLIE SCISM - WSJ.com
People with long-term-care insurance polices are getting hit with a new round of steep premium increases. But there are options that can help both existing policyholders and new buyers cut some of the costs.
Last month, industry behemoth John Hancock Financial said it would ask state regulators for an average 40% increase for about 850,000 of its 1.1 million policyholders. The insurer, a unit of Manulife Financial Corp., also suspended sales of new long-term-care plans to employer-benefits programs.
In recent months, companies including American International Group Inc., MetLife Inc. and Lincoln National Corp. have applied for or received approval in one or more states for rate rises ranging from 10% to 40%.
Flashback to 1870 as Cotton Hits Peak
By ADAM CANCRYN and CAROLYN CUI - WSJ.com
Cotton prices touched their highest level since Reconstruction on Friday, as a string of bad harvests and demand from China spark worries of a global shortfall.
The sudden surge in prices - cotton has risen up to 56% in three months - has alarmed manufacturers and retailers, who worry they may be forced to pass on higher costs to recession-weary consumers.
The December cotton contract hit $1.1980 a pound minutes after the opening of trading on the IntercontinentalExchange Inc. on Friday. It is officially the highest price since records began back in 1870 with the creation of the New York Cotton Exchange.
Rising Corn Prices Will Soon Mean Fatter Meat Prices
By CHARLES WALLACE - DailyFinance.com
The government may have reported a core inflation rate for September that barely budged from August, but there's still bad news for consumers at the grocery store: A spike in corn prices will probably lead to higher meat prices soon.
The price of corn has shot up 8% during the week of Oct. 11 alone, bringing the total rise to close to 50% in the last three months. The sharp increase came after the Department of Agriculture issued a forecast for corn production that was 4% lower than the forecast it had issued in September. That would put the crop at 12.7 billion bushels, about 3% less than last year's crop.
Most of the corn is used for animal feed, so it's an important component of beef and pork prices (and, of course, ethanol).
Will physical books be gone in five years?
By Cody Combs, CNN
Washington (CNN) -- As e-book readers and tablet computers become more common, one prominent tech mogul says that physical books could disappear sooner than expected.
In an interview with CNN's Howard Kurtz on "Reliable Sources," author Nicholas Negroponte, founder of One Laptop per Child, said the physical book's days are numbered.
"It will be in five years," said Negroponte. "The physical medium cannot be distributed to enough people. When you go to Africa, half a million people want books ... you can't send the physical thing."
U.S. Companies Are at Risk of Spying by Their Own Workers
By CHRISTOPHER DREW - NYTimes.com
Huang Kexue, federal authorities say, is a new kind of spy.
For five years, Mr. Huang was a scientist at a Dow Chemical lab in Indiana, studying ways to improve insecticides. But before he was fired in 2008, Mr. Huang began sharing Dow's secrets with Chinese researchers, authorities say, then obtained grants from a state-run foundation in China with the goal of starting a rival business there.
Now, Mr. Huang, who was born in China and is a legal United States resident, faces a rare criminal charge - that he engaged in economic espionage on China's behalf.
Mexican hit men stalk U.S. Drug lords' gunmen target narcotics thieves, feds say
By Jerry Seper - The Washington Times
Drug-smuggling gangs in Mexico have sent well-armed assassins, or "sicarios," into Arizona to locate and kill bandits who are ambushing and stealing loads of cocaine, marijuana and heroin headed to buyers in the U.S., the Department of Homeland Security has warned Arizona law enforcement authorities.
In a memo first sent in May but widely circulated since, the department said a group of "15, very well-equipped and armed" assassins complete with body armor had been sent into the state to identify, locate and kill the drug thieves, who are thought to be independent operators.
Chinese firm to fix 300 U.S. homes ruined by corrosive drywall
By Cain Burdeau, Associated Press
NEW ORLEANS - A Chinese drywall manufacturer, along with suppliers, builders and insurers, agreed Thursday to repair up to 300 homes in four states and possibly thousands more damaged by corrosive drywall.
In this pilot program, up to 300 homeowners in Florida, Louisiana, Alabama and Mississippi whose homes had drywall manufactured by Knauf Plasterboard Tianjin Co. will get their homes fixed, lawyers said. Homeowners in Texas, North Carolina and Virginia could be added soon.
Knauf and the other companies have agreed to replace drywall, wiring, fire and alarm systems, and fixtures in damaged homes. Many more of the 2,000 to 3,000 homes built with Knauf drywall might be fixed under similar terms if the pilot program is successful.
"We think this program can grow," said Kerry Miller, a lawyer for Knauf.
U.S. says Chinese businesses and banks are ignoring U.N. sanctions against Iran By John Pomfret - Washington Post
The Obama administration has concluded that Chinese firms are helping Iran to improve its missile technology and develop nuclear weapons, and has asked China to stop such activity, a senior U.S. official said.
During a visit to Beijing last month, a delegation led by Robert J. Einhorn, the State Department's special adviser for nonproliferation and arms control, handed a "significant list" of companies and banks to their Chinese counterparts, according to the senior U.S. official, who spoke on condition of anonymity to discuss a sensitive issue in U.S.-Chinese relations. The official said the Obama administration thinks that the companies are violating U.N. sanctions, but that China did not authorize their activities.
Arab League may seek direct UN recognition of Palestinian state Members of the Arab League may seek direct United Nations recognition of a Palestinian state as Netanyahu approved further settlement construction in East Jerusalem. The US expresses its concerns over UK defence cuts. Aid workers are kidnapped in Somalia.
Oliver Scanlan - OpenDemocracy.net
On Friday, rhetoric over the stalled direct talks between the Palestinian Authority (PA) and the Israeli government reached a new level of acrimony when the Egyptian foreign minister, Ahmed Aboul Gheit, suggested that members of the Arab League may appeal directly to the UN to recognise the state of Palestine. The announcement comes one week after the Arab League supported PA President Mahmoud Abbas' decision to suspend talks with Israel if the Israeli government did not extend a moratorium on settlement construction on the West Bank.
Iran's leader, Hezbollah seen as Lebanon guardians
By Heather Murdock - The Washington Times
BINT JBEIL, Lebanon | While tens of thousands of frenetic, sweating fans chanted and waved flags, Sam was stoic. He pressed up against the metal fence corralling the crowd and held his camera phone in the air for hours. He was at least 50 feet from the podium, but Sam would not miss his chance to photograph visiting Iranian President Mahmoud Ahmadinejad.
"Now Israel is very, very, very scared of our Lebanon," Sam said on a rocky dirt road only miles away from the Israeli border after the rally. "That's why Mr. Ahmadinejad came to Lebanon."
Mr. Ahmadinejad left Lebanon late last week. In his wake, regional and local political tensions were left aggravated. But many Lebanese people - including Christians and Muslims - say Iran and its support for Hezbollah, a Shiite military group that controls much of Lebanon, are necessary for their country's survival.
N. Korea threatens '1,000-fold' increase in weapons
SEOUL (AP) - North Korean media on Saturday threatened a "1,000-fold" military buildup as the United States ruled out lifting sanctions to try to coax the North into resuming talks aimed at its nuclear weapons programs.
Last year, North Korea quit the nuclear disarmament talks and later tested an atomic device that drew tightened U.N. sanctions.
But North Korea said Saturday it is willing to rejoin the negotiations and remains committed to implementing a September 2005 accord on abandoning its nuclear program in exchange for aid and security guarantees. Instead, it accused the United States and other participants of holding back the six-nation talks.
Fannie and Freddie in a Mess
By Megan McArdle - TheAtlantic.com
The foreclosure mess is now spreading to Fannie and Freddie, as our government-owned mortgage machines starts looking into what, exactly, its servicers have been doing with their loans. Meanwhile, I detect some overblown expectations on the part of various people; last night, after I gave a talk on a mostly unrelated subject, two different people asked me if this meant that they could simply walk away from their mortgages; it wasn't clear if they were hoping, or horrified.
Might happen in a few rare cases, but I'm dubious. I don't want to minimize the scope of this problem: it's clear that overwhelmed servicers decided the fastest way to move through their vast backlog of foreclosures was to muster a sort of heroic insouciance about the legal niceties surrounding the paperwork. Courts (and banks) are right to say that the process needs to slow down until that's straightened out.
Foreclosure Fraud: 6 Things You Need To Know About The Crisis
That Could Potentially Rip The U.S. Economy To Shreds
TheEconomicCollapseBlog.com
The foreclosure fraud crisis seems to escalate with each passing now. It is being reported that all 50 U.S. states have launched a joint investigation into alleged fraud in the mortgage industry. This is a huge story that is not going to go away any time soon. The truth is that it would be hard to understate the amount of fraud that has gone on in the U.S. mortgage industry, and we are watching events unfold that could potentially rip the U.S. economy to shreds. Many are now referring to this crisis as "Foreclosure-Gate", and already it is shaping up to be the worst thing that has ever happened to the U.S. mortgage industry. At this point, it seems inevitable that some financial institutions will go under as a result of this mess. In fact, by the end of this thing we might see a whole bunch of lending institutions crash and burn. This crisis is very hard to describe because it is just so darn complicated, but it is worth it to try to dig into this thing and understand what is going on because it has the potential to absolutely decimate the entire U.S. mortgage industry.
Majorities in U.S. View Gov't as Too Intrusive and Powerful Independents largely side with Republicans in denouncing big government by Lydia Saad - Gallup Polls
PRINCETON, NJ -- Record- or near-record-high percentages of Americans are critical of the size and scope of government, as measured by four Gallup trend questions updated in September. This sentiment stretches to 59% of Americans now believing the federal government has too much power, up eight percentage points from a year ago.
Nearly as many Americans also give the antigovernment response to a question asking whether government should do more to solve the country's problems or whether it is doing too many things that should be left to businesses and individuals. Today's 58% saying it is doing too much is just slightly below the 59% to 60% levels recorded in the mid- to late '90s.
Roubini Sees 35-40% Odds of U.S. Double-Dip Recession
By Jun Yang
Oct. 14 (Bloomberg) -- New York University Professor Nouriel Roubini said he expects a 35 percent to 40 percent chance of the U.S. entering a double-dip recession, highlighting the risks faced by the world's largest economy.
"Since second quarter growth in U.S. was only 1.7 percent and everything's going to be weaker in the second half of the year, by the fourth quarter economic growth in the U.S. could be as low as 1 percent," Roubini said in a conference today in Seoul. "The growth rate is so low it's going to feel like a recession even if technically this is not a recession."
Slashing the Dollar...The Future is Ugly
by Mike Whitney - SilverBearCafe.com This has the makings of a real donnybrook.
The Fed has has hinted that it will launch a second round of quantitative easing (QE) sometime after its November 2 meeting. The anticipated intervention has been widely criticized, but for all the wrong reasons. Fed chairman Ben Bernanke knows that adding another $1 to $1.5 trillion to bulging bank reserves will likely have little effect on aggregate demand. Nor will it lower unemployment now hovering at 9.7%. It will, however, send a message to trading partners (re: China) that the Fed is serious about reducing destabilizing trade imbalances that siphon-off domestic stimulus, increase unemployment and keep the dollar perilously overvalued. In other words, the Fed's action is the first volley in what is likely to be a protracted currency war that leads to the final demise of Bretton Woods 2.
Comex Gold hits record high as US Dollar slumps; Bulls eyeing $1,400
By Jim Wyckoff of Kitco News
Comex gold prices are trading higher Thursday morning and have notched another all-time record high of $1,388.10 in December futures. The U.S. dollar continues to get hammered lower, which continues to drive investor interest into the safe-have asset gold. December Comex gold last traded up $12.00 an ounce at $1,382.50. Spot gold was last quoted up $9.60 at $1,382.00.
The U.S. dollar index hit a fresh 10-month low Thursday morning as the selling pressure on the greenback is picking up momentum. Most market watchers look for the U.S. Federal Reserve to announce a quantitative easing of monetary policy at its early-November meeting. Now, the only question is what will be the size of the "QE" package.
US Dollar Plunges, Gold Soars To New Record, Sold With $200+ Mark Ups
Hints of mutiny within Fed as attempt to crash dollar becomes clear By Steve Watson - Infowars.net
The US dollar plunged once again today as the currency continues to be battered by increasingly substantial rumors that the Federal Reserve will announce, within the next three weeks, plans to buy $1 trillion of government debt in the form of "monetary easing".
The dollar hit a fresh 10-month low Thursday morning, falling for a third day running against a basket of six major currencies.
The greenback is trading at a near 15-year low against the yen as the selling pressure picks up momentum.
"Aggressive Investors" Target $1400 Gold and $25 Silver as Global Currency Crisis "Is Upon Us"
By: Adrian Ash - GoldSeek.com
THE WHOLESALE PRICE of gold and silver bullion retreated from fresh record highs against the Dollar early Thursday afternoon in London, slipping back from overnight jumps of 1.3% and 4.5% respectively as the US currency's latest plunge paused.
European stock markets reversed early gains, but Asian stocks ended the day more than 1.5% higher on the MSCI index, as the Japanese Yen squashed the Dollar to a new 15-year low beneath '81 and the Euro leapt above $1.41.
"It is no wonder the rally of precious metals has been relentless," said a Hong Kong dealer of Thursday's Asian trade. "Silver led the pack higher ... Then gold took over.
Foreclosure Mess Could Be Taxing for Mortgage Investors
By DAVID REILLY - WSJ.com
The foreclosure mess has raised plenty of legal questions around banks' handling of defaulted mortgages. But the scandal also may raise tax problems for mortgage-backed securities.
These securities were usually issued by real-estate mortgage investment conduits, or remics. They take in mortgage income and pass it through to investors without paying corporate tax.
To qualify as a remic, assets have to be transferred or formally assigned to the vehicle usually within 90 days of its creation. The assets have to be qualifying mortgages. And they have to be secured by the property being mortgaged.
Why Bernanke's Money Printing Promises Spell Disaster
By Bill Bonner - The DailyReckoning.com
... Ben Bernanke gave the Japanese some advice about 10 years ago. He said that if their economy was stuck in the doldrums it was their own damned fault. He didn't put it that way. He said their problems were largely "self-induced." Which is a polite way of saying it was their owned damned fault.
He made it clear that he wouldn't let that happen to him. He'd use the tools at his disposal to light a fire under the economy. Anyway, that's what he told them.
And now, here he is. In Tokyo. Well, not literally in Tokyo. You know what we mean. He's faced with almost the same set of problems that faced the Japanese - a sluggish, de-leveraging, funky kind of economy.
U.S. producer prices up twice as fast as expected U.S. trade deficit widened sharply in August;
China gap at all-time high
MSNBC.com news services
Rising food and energy prices pushed inflation at the wholesale level up twice as fast as expected last month, and prices excluding those staples rose at the fastest annual pace in a year, data released by the Labor Department showed on Thursday.
The overall producer price index rose 0.4 percent in September and the core index, which excludes volatile food and energy prices, rose 0.1 percent in the month. Economists polled by Reuters had expected overall prices to rise just 0.2 percent and the core producer price index to rise 0.1 percent in September.
Separately, the U.S. trade deficit widened sharply in August, reflecting a surge in imports of consumer products as businesses restocked their shelves in hopes of a pickup in consumer demand.
Geithner: Freeze On Foreclosure Sales Would Worsen "National Tragedy"
(RTTNews) - A national moratorium on foreclosure sales might further depress housing prices, hurting those already squeezed by the housing crunch, according to Treasury Secretary Timothy Geithner.
Appearing on the Charlie Rose Show, Geithner said the foreclosure crisis was a "national tragedy," but that a total freeze on foreclosure proceedings would delay the healing of the housing market.
Banks have been accused of cutting corners in order to rush through foreclosure proceedings, resulting in a wave of improper evictions.
U.S. is currency war's "tomb maker": China economist
(Reuters) - The United States fired the first shot in the currency war and the rest of the world must be on guard for its deliberate strategy to devalue the dollar, a Chinese economist said in an official newspaper on Thursday.
In a front-page commentary in the overseas edition of the People's Daily, Li Xiangyang described the United States as the conflict's "first maker of tomb figures," a Chinese idiom that means someone who creates a bad precedent.
Li, head of the Asia department at the Chinese Academy of Social Sciences, a top government think tank, said continued intervention in currency markets by developed economies would deal a blow to global economic recovery.
The Silk Superhighway New global trade routes are emerging, and America is being bypassed. BY ROBERT MORLEY - theTrumpet.com
Who is China's largest trading partner?
If you guessed the United States, you're wrong. The European Union is now China's most important market.
If you got the first one right, here is another question for you: Who are the biggest exporters in the world? First place goes to the European Union. Second goes to China. Third would then go to Germany if it wasn't already included within the EU. America comes in at a distant fourth place, followed by Japan.
The world has changed.
It wasn't long ago that America was not only the largest exporter of manufactured goods, but it was also the world's most important economy.
Record gap with China sends U.S. trade deficit soaring in August Commerce Department says the overall shortfall in the exchange of goods and services jumped to $46.3 billion - with more than half of that coming from China.
By Don Lee, Los Angeles Times
A record monthly trade deficit with China helped send the overall U.S. trade imbalance surging unexpectedly in August, prompting experts to shave their projections of economic growth and adding fuel to midterm election campaigns already filled with vitriol over the outsourcing of jobs and a rising Chinese economy.
The Commerce Department said the overall shortfall in the exchange of goods and services jumped to $46.3 billion - with more than half of that coming from China. The trade deficit this year through August has soared 43% to $335 billion from the same eight-month period last year.
Chinese Yuan: Next World Reserve Currency?
By Chuck Butler - The DailyReckoning.com
10/13/10 St. Louis, Missouri - Good day ... And a Wonderful Wacky Wednesday to you! Why Wacky? Wel ... The dollar rally that I told you was merely a correction of the too far, too fast moves in currencies, and precious metals, is overÉ And over in a BIG WAY! We're right back to the lofty levels we saw on Friday morning ... So, your two days of opportunity to buy currencies and precious metals at cheaper levels is now in the rearview mirror.
I told you yesterday, that I thought the FOMC meeting minutes would put to bed all the naysayers' thoughts that the FOMC was NOT going to implement a new round of quantitative easing (QE) ... And that's exactly what happened. So, once the meeting minutes showed that the Fed Heads were prepared to implement QE "before long" - and since after that meeting we had the disappointing Jobs Jamboree - the writing was on the wall for more QE, and this time, the naysayers had no terra firma to stand on.
China's Quiet Australian Invasion Economic imperialism in action
From The Trumpet.com
The world economic crisis has treated Australia well. While the global economy shrank for the first time since the 1930s, Australia kept growing. Its unemployment remains at a mere 5.1 percent. (In the U.S. it is nearly twice as high: 9.6 percent.) And the Australian government didn't bail out a single bank. How?
As former Filipino President Fidel Ramos wrote, "Australia's continued boom it owes to mineral and energy exports to China."
"Australia is about to embark on its biggest mining investment boom since the 1850s Gold Rush," Australia's Treasurer Wayne Swan said in a speech on October 11 at the New York Stock Exchange. The boom is being driven by China's voracious appetite for raw materials.
This China-driven mining boom is the source of Australia's continued prosperity.
US Debt on the Shoulders of 90 Million People
By The Mogambo Guru - The DailyReckoning.com
10/13/10 Tampa, Florida - Now that the federal government's fiscal year ended on September 30 and they had to "square up" their accounting, we find some very interesting things, if you will forgive the use of the phrase "very interesting" when I should have used the more descriptive Poop In Your Pants Scary (PIYPS).
One of these PIYPS things is that the one-year increase in the national debt, thanks to the unbelievable fiscal insanity of the deficit-spending Obama administration and the corrupt and moronic Congress, which is not to mention the monstrous monetary insanity of the loathsome Federal Reserve creating so much new money for them to borrow that inflation in prices will destroy us all. It is now revealed that in FY 2010, the national debt rose $1.72 trillion! In one year!
Dollar Softens; Wall Street Shares Hesitate
By THE ASSOCIATED PRESS - NYTimes.com
Shares on Wall Street struggled Thursday after another disappointing report on jobs. But losses were limited because traders expect the Federal Reserve will act soon to strengthen the economy.
In recent months, a disappointing weekly jobs report would have likely led to a big sell-off in stocks. However losses have been limited following weak economic reports recently because such weakness supports expectations the Fed will step in to support growth.
Dollar Negativity Soars on Pending QE2
By Chuck Butler - The DailyReckoning.com
10/14/10 St. Louis, Missouri - The negativity toward the FOMC's pending quantitative easing (QE) and the dollar just continues to mount ... I'll tell you this now, so you can listen to me later ... This negativity is stronger right now than at any time in the past 8 years of this weak dollar trend ... The euro (EUR) traded over 1.41 overnight, the Canadian dollar/loonie (CAD) traded parity to the US dollar, the Chinese renminbi (CNY) posted another 5-year high fixing level, and the Monetary Authority of Singapore gave the green light to traders to continue to move the Sing dollar (SGD) stronger!
It's all about the QE folks ... QE 24/7, all day, all night ... So, here's the problem as I see it with these strong moves all at once ... It's probably going to be a "buy the rumor, sell the fact" with all the run-up in currencies and precious metals coming before the FOMC implements QE, and then comes the profit taking once the QE gets implemented.
Inflation and the Federal Reserve Fiat System
Szandor Blestman - SilverBearCafe.com
I recently engaged in an email exchange with a reader. He was interested in finding out more information about the subjects broached in my article about the financial mess in Iceland released earlier this year. I assumed he was looking for information about central banking and told him about a book I had read years ago called "The Creature From Jekyll Island" by G. Edward Griffin. This is a book written by a highly respected author that tells of the secretive creation of the Federal Reserve.
To begin with, I told him that I feel the current system is immoral and that is what I base my opinion on. When the power to print the money people use is given to a very few people, then those people become very powerful, too powerful. I believe those people have, without a doubt, abused the power they were entrusted with for their own benefit.
Bankers Ignored Signs of Trouble on Foreclosures
By ERIC DASH and NELSON D. SCHWARTZ - NYTimes.com
At JPMorgan Chase & Company, they were derided as "Burger King kids" - walk-in hires who were so inexperienced they barely knew what a mortgage was.
At Citigroup and GMAC, dotting the i's and crossing the t's on home foreclosures was outsourced to frazzled workers who sometimes tossed the paperwork into the garbage.
And at Litton Loan Servicing, an arm of Goldman Sachs, employees processed foreclosure documents so quickly that they barely had time to see what they were signing.
The Questions That Swirl Around The Fed What is the Fed doing with paper, Fed liquidity in question, the dollar will fall, no exit strategy for the crisis to come, worst areas still unregulated, forecasting strong gold and silver for the next four months, real inflation already a threat, IMF fails to deal with currency frictions.
By Bob Chapman - theInternationalForecaster.com
The question keeps swirling around regarding the Fed and just how much Treasury paper they can buy from the market under current rules. Our guess is about $1.7 trillion. A good part of that may well be in notes, which will probably keep long dated rates low. On the other hand they may increase the current limit, and buy everything in sight. That probably means the 10-year T-note could fall from its current level of 2.50% yield to 1.5% yield and mortgages, as we stated before could fall to 3.38% on the 30-year fixed rate loan. This kind of spirited buying would tend to crowd out other buyers forcing them into corporates, foreign bonds, commodities and gold and silver, as well as back into the stock market. This kind of policy means major monetization, higher inflation and perhaps eventually into hyperinflation. Needless to say, this is a very dangerous game. A plunge into a monetary no man's land. The liquidity that will be set loose in the POMO market will be enormous and the avalanche will begin early next year and it will cause asset price inflation. These antics will also suppress the value of the dollar forcing a test of 71.18 and perhaps breaking that long-term support level.
U.S. Economy: Trade Gap Grows, Jobless Claims Unexpectedly Rise
By Bob Willis and Courtney Schlisserman
Oct. 14 (Bloomberg) -- Companies in the U.S. are buying more foreign-made semiconductors and cars as they invest in equipment and build stockpiles, while also keeping a tight rein on payrolls, reports today showed.
The trade deficit widened 8.8 percent to $46.3 billion in August from $42.6 billion the prior month as a rise in imports swamped gains in exports, Commerce Department figures showed today in Washington. The number of Americans filing claims for jobless benefits unexpectedly climbed by 13,000 to 462,000 last week, according to the Labor Department.
Lower- and Middle-Income Spending Lowest Since January '08 Overall self-reported spending matches lowest level seen since tracking began in January 2008
by Dennis Jacobe, Chief Economist - Gallup.com
PRINCETON, NJ -- Lower- and middle-income Americans' self-reported average daily spending in stores, restaurants, gas stations, and online averaged $48 per day during September -- down $6 from August and $16 from July. Consumer discretionary spending by these Americans making less than $90,000 a year is now at its lowest level since Gallup began daily tracking in January 2008, as the recession was just getting underway.
Nearly Half of Small-Business Owners May Never Retire More than 6 in 10 small-business owners changed retirement plans due to economic downturn
by Dennis Jacobe, Chief Economist - Gallup.com
PRINCETON, NJ -- Nearly half, 47%, of small-business owners now plan to never retire until forced to do so for health reasons -- up from about 4 in 10 in 2005 and 2007 -- according to a recent Wells Fargo/Gallup Small Business Index poll. Another 41% plan to cut back on work but stay involved with their business when they retire. Those planning to stop working in their business altogether fell to 1 in 10 during 2010 from nearly twice that level in 2005.
Applications for Jobless Benefits Rise to 462,000
By Christopher S. Rugaber, Associated Press
Washington (AP) - More people applied for unemployment benefits last week, the first rise in three weeks and evidence that companies are reluctant to hire in a slow economy.
Initial claims for unemployment aid rose by 13,000 to a seasonally adjusted 462,000, the Labor Department said Thursday. It was only the second rise in two months.
Democracy is Destroying the US
Jeff Berwick - SilverBearCafe.com
Faced with a horrible unemployment situation and many companies moving out of the US to countries such as China and India, many point the finger of blame at "globalism". But companies aren't necessarily leaving the US just because it can be cheaper to operate in other regions. The problem is much deeper and has more to do with companies escaping high taxation, ridiculous amounts of regulation and moving to regions that are growing as opposed to the US which is in a terrible state of disrepair and only getting worse.
Globalism (which actually began 450 years ago with the Spanish Galleon trade between Acapulco and Manila), or free trade (if it is actually free trade and not some World Trade Organization monstrosity) is not a problem nor is it a problem for the US - removing obstructions to trade can only improve living standards. It would take hundreds of pages to fully outline what has brought the USA to where it is today but to state it as briefly as possible, the great majority of the problems in the US today derive from the one thing that most Americans today believe is what their country is "all about": Democracy.
Fed's Lacker Says Making Jobs an 'Imperative' Risks Inflation
By Steve Matthews and Joshua Zumbrun
Oct. 14 (Bloomberg) -- Richmond Federal Reserve Bank President Jeffrey Lacker said a Fed policy devoted primarily to reducing unemployment risks damaging the central bank's credibility in containing inflation.
"With inflation reasonably close to any plausible definition of price stability, and all expectations measures pointing in the right direction, making unemployment a policy imperative poses clear risks to the credibility of our long run inflation goals," Lacker said yesterday in a speech in Chapel Hill, North Carolina.
Charting the Foreclosure Crisis's Far-Reaching Consequences
By CHARLES HUGH SMITH - DailyFinance.com
Even as the consequences of the ongoing foreclosure crisis slowly unfold -- and the ultimate impact is yet unknown -- it's not too early to tote up a list of 10 potentially important developments that have already happened.
1) Title companies are pulling back from issuing title insurance on homes that were sold in foreclosure or that were previously foreclosed. Not being able to obtain title insurance is the kiss of death for real estate transactions, as Mark Hanson, an independent housing analyst in Menlo Park, Calif., recently observed. "Title companies would be crazy to ensure title on anything remotely associated with a foreclosed property because we don't know how this is going to resolve itself."
September home foreclosures top 100,000 for first time
By Corbett B. Daly
(Reuters) - The number of homes taken over by banks topped 100,000 for the first time in September, though foreclosures are expected to slow in coming months as lenders work through questionable paperwork, real estate data company RealtyTrac said on Thursday.
Banks foreclosed on 102,134 properties in September, the first single month above the century mark, RealtyTrac said. There were 347,420 total foreclosure filings in September, 3 percent higher than August and 1 percent higher than a year earlier.
Chaos in South Florida housing market leaves more people renting
By Paul Owers, Sun Sentinel
South Florida's rental housing market is booming as foreclosures and price declines have many residents leery of homeownership or unable to qualify for mortgages.
There are fewer empty rental apartments in Broward and Palm Beach counties this year over last year and rental rates are higher. Some new renters are former homeowners who have lost their properties to lenders, while others don't want to be shackled to homes in an uncertain economy.
Turning renters into buyers is critical to solving the nation's housing woes, analysts say. But even young professionals who have never owned appear to have soured on the prospect of buying homes and prefer to rent.
Quantifying The Full Impact Of Foreclosure Gate: Hundreds Of Billions To Start
by Tyler Durden - ZeroHedge.com
As people finally realize that there is no getting away from a self-imposed (or sent from above) foreclosure moratorium reality, the next question is the quantification of what the hit to banks will be. As bank stock shares are demonstrating today, it will be substantial and is already starting to be priced in. According to FBR's Paul Miller, as cited by Bloomberg, "faulty foreclosures may cost U.S. lenders $2 billion for every month that home seizures are delayed and the tab could reach $6 billion... Investigations of how banks are seizing homes may prolong foreclosures by as much as three months, at a rough cost of $1,000 per month for each property in the pipeline. The biggest firms likely need to add staff to comb through the files, costing them each $1 million a year." This is a very a modest estimate. More importantly, a separate study by SNL Financial has determined that the total amount of residential (not commercial) mortgages in foreclosure between directly serviced, and those serviced for others, for the big three banks alone (JPM, WFC, BAC) is nearly a quarter of a trillion dollars!
Meet Danielle And Jim Plus 9: The Squatters Who "Reclaimed" Their Foreclosed Home Over The Weekend by Tyler Durden - ZeroHedge.com
Unfortunately, surreal stories like this will very soon become daily news. As was pointed out yesterday, Simi Valley has just seen the first case of a forced reclamation of a foreclosed home, after Jim and Danielle Earl took their nine (9!) children, ages 9-23, and a locksmith and broke into the six-bedroom house that had been foreclosed upon for lack of payment, and on which the couple owed $880,000! And where would such brilliant advice originate from? Why, the couple's lawyer of course, who will one day be seen as the prophetic visionary who stole the bankers wealth from underneath them and handed it out to America's millions of starving lawyers, one billing sheet at a time: "The move was recommended by their lawyer" as the WSJ suggests. Already in process: millions of cases identical to this one, billions in legal fees, and hundreds of billions in lost market value of associated equity and credit instrument, not to mention very unpleasant days for LPs in "Recovery" funds.
BofA Agrees to Indemnify Title Co. on Foreclosure Sales
NationalMortgageNews.com
To secure title insurance on REO sales, Bank of America has agreed to indemnify a major insuror if the title is challenged due to robo-signings and other improper foreclosure processing practices.
"Bank of America and Fidelity National Financial have reached an agreement confirming that Fidelity will provide title insurance on the sale of foreclosed properties," said B of A spokesman Dan Frahm.
Under the agreement, Fidelity will defend the new homeowner in court if a foreclosed owner challenges the title. B of A will cover the costs and, if necessary, any damages awarded to the previous owner.
"Bank of America and Fidelity National are taking this step to facilitate the continued availability of title insurance that is vital to the marketability of foreclosed properties," Frahm said.
The giant bank is seeking similar agreements with other title insurers.
Should Foreclosure-Gate Spur More Modifications?
By Daniel Indiviglio - TheAtlantic.com
Banks screwed up. Their shoddy documentation and flawed procedures surrounding their mortgage business has led to many halting foreclosures while they clean up the mess. Should they consequently offer additional, more aggressive mortgage modifications as a result? That's the growing call from progressive circles. Yet there's no logical connection here: banks may have been negligent in their bookkeeping, but that doesn't suddenly mean defaulted homeowners are suddenly reincarnated as creditworthy borrowers who can now afford their houses.
Banks Will Be Forced to Forgo Certain Foreclosures Even If the Borrower Has Admittedly Defaulted!
by Reggie Middleton - ZeroHedge.com
About a week or so ago, I posed a controversial question, Is the US Government About to Forgive Mortgage Debt? Let's Crowdsource Our Way Through a Scenario or Two! In that missive I warned that the recovery rate on many of the repossessed properties was not only at a historic low, but actually approaching zero, save a few blips from .gov bubble blowing and shenanigans by banks in the form of kicking cans down the road. I also said that the time may very well come when there may be no economic incentive for banks to foreclose on certain properties, and that pool of properties may grow larger than many could imagine. I know it is difficult for many to come to grips with this, but the math really ain't that hard.
Foreclosure Activity up 4% in Third Quarter: RealtyTrac
BY: CARRIE BAY - DSNews.com
RealtyTrac's latest report puts the impact of these foreclosure moratoria into perspective. The company found that foreclosure activity in the judicial foreclosure states most affected by the paperwork problems accounted for 40 percent of all foreclosure filings in the third quarter and 36 percent of bank repossessions, or REOs.
"If the lenders can resolve the documentation issue quickly, then we would expect the temporary lull in foreclosure activity to be followed by a parallel spike in activity as many of the delayed foreclosures move forward in the foreclosure process," Saccacio said. "However, if the documentation issue cannot be quickly resolved and expands to more lenders we could see a chilling effect on the overall housing market as sales of pre-foreclosure and foreclosed properties, which account for nearly one-third of all sales, dry up and the shadow inventory of distressed properties grows - causing more uncertainty about home prices."
Chase Acts to Broaden Foreclosure Reviews
By ERIC DASH - NYTimes.com
As the uproar over questionable conduct by mortgage lenders intensified Wednesday, one of the nation's largest banks distanced itself from a controversial, industry-owned registration system that oversees millions of home loans.
As the uproar over questionable conduct by mortgage lenders intensified Wednesday, one of the nation's largest banks distanced itself from a controversial, industry-owned registration system that oversees millions of home loans.
Foreclosure-Gate's Doomsday Scenario
By Daniel Indiviglio - TheAtlantic.com
The documentation problems surrounding mortgages originated during the housing boom just get uglier and uglier. One of the most recently surfaced worries is also one of the most serious. Bank analyst Josh Rosner envisions a doomsday scenario where banks would have to stand behind most private label mortgage-backed securities (MBS) that they had believed they had no exposure to. This would be disastrous.
The background here gets complicated, so I'll try to simplify. Basically, when creating a MBS, the bank who originally provides the mortgages to borrowers sells those mortgages to a trust through a legal process called a "true sale." The trust then sells bonds to investors, which are secured by those mortgages. Due to sloppiness, that true sale may never have been legally executed in most cases.
US housing sector in 'moral hazard'
Press T.V. - SilverBearCafe.com
Foreclosures have been halted in many states as allegations surface of widespread fraud by the banks and mortgage companies in expediting foreclosures.
Now there are mounting calls for a national moratorium on foreclosures. But many fear that such moves could deteriorate the ailing housing market.
The following is the transcript of an interview Press TV conducted with Max Keiser, a money markets analyst. Press TV: How could this have happened? Keiser: I worked on Wall Street for many years and the practice of forging documents is pretty common but what we see here is an "assembly line approach" where thousands of documents are being forged, all the mortgagers have been fraudulently reconceived.
Prepaid cards will have you paying, all right Numerous fees, some not easy to discern at first, can add up quickly By Herb Weisbaum ConsumerMan - MSNBC.com
They're the debit cards you can buy at a drugstore or supermarket and use wherever major credit cards are accepted, even online. You don't need a bank account, since these cards are not linked to one (even though they have a Visa, MasterCard, Discover or American Express logo). There's no minimum balance required. And best of all, no credit check.
Demand for these cards is growing explosively, as people use them to stick to a budget and avoid costly bank fees. But a prepaid debit card can be more costly than you think.
"Some of them are really nickel-and-diming you worse than the banks," says Gail Hillebrand, a senior attorney at Consumers Union (publisher of Consumer Reports). "We found that you really had to poke around in the company websites to find all the fees. They're not all listed on the packaging. And they vary quite widely from card to card."
How to Reform ObamaCare Starting Now States should steer the mandated health-insurance exchanges
in a pro-market direction and dare Washington to stop them.
By SCOTT GOTTLIEB AND TOM MILLER - WSJ.com
The Republican rallying cry during this election season has been a promise to "repeal and replace" ObamaCare. The problem is that through at least 2012 President Obama would veto any law repealing his signature health-care legislation. What, then, can Republicans do in the next two years? Look to the states.
After November, more than 30 Republican governors (many newly elected) will have the opportunity to resist the legislation at the state level. They could refuse to implement the health-care exchanges that are the core of ObamaCare. Doing so would force the federal government to step in and run the exchanges for the states-a chore that would slow down federal implementation of ObamaCare but fail to provide any alternative solution to insurance coverage problems.
HHS Scrambles to Stop Insurers From Dropping
Their 'Child-Only' Policies
By Susan Jones
(CNSNews.com) - "Nothing in the Affordable Care Act, or any other existing federal law, allows us to require insurance companies to offer a particular type of policy at this time," Health and Human Services Secretary Kathleen Sebelius said on Wednesday (emphasis added).
In an Oct. 13 letter to the National Association of Insurance Commissioners (NAIC), Sebelius complained that some insurance companies have decided to stop writing new policies in the "child-only" insurance market.
The new health care law makes it illegal for insurance companies to deny coverage to children with pre-existing medical conditions, so rather than deny such expensive coverage, a number of insurance companies have said they will drop it altogether.
Wal-Mart Sees Small Stores in Big Cities
By MIGUEL.BUSTILLO - WSJ.com
Wal-Mart Stores Inc. is planning to open dozens of small stores in the nation's cities, in an effort to push back against the dollar chains and other competitors nibbling at its customers.
The prospect of Wal-Mart stores dotting America's biggest cities would change the urban landscape and the profile of the world's largest retailer, known for its blocky suburban edifices stocked with low-cost goods. The new stores, roughly a quarter to a third the size of a supercenter, largely will sell groceries.
Bill Simon, head of Wal-Mart's U.S. stores business, said Wal-Mart envisions opening in the next few years 30,000- to 60,000-square-foot Neighborhood Market groceries and new, smaller outlets modeled on the bodegas it operates in Latin America. Its supercenters average 185,000 square feet.
Wal-Mart looks to stock more local produce
By MICHELLE CHAPMAN - AP - via GoogleNews
NEW YORK - Wal-Mart Stores Inc. plans to double its sales of locally sourced produce in the U.S. by the end of 2015.
The move by the world's biggest retailer is part of a new sustainable agriculture strategy that looks to steer more business to small and medium-sized farmers globally while also reducing farming's environmental impact.
Wal-Mart plans to buy more of select U.S. crops. It also plans to train 1 million farmers and farm workers in emerging markets in crop selection, sustainable farming practices and other subjects and selling $1 billion in food sourced from 1 million small and medium-sized farmers.
Embarrassing Volt Charges
By Eric Peters - The American Spectator.org
GM apparently has some 'splainin to do -- and not just to Lucy, but also to the American taxpayers who have bankrolled its operations since that terrible I've Fallen -- And I Can't Get Up moment back in late '08.
Reason?
That new Volt all-electric car you've been hearing so much about -- and which GM has been touting as an example of its resurgent We Get It attitude -- is apparently a con.
Or at least, a semi-fraud.
GM had claimed the Volt would be what amounts to a completely electric car, driven entirely by its electric motor and battery pack. The Volt's small on-board gasoline engine would only operate as a kind of take-it-with-you recharging unit, power alternators (like a home generator) but not the car's drive wheels.
Verizon to sell Apple's iPad Move breaks AT&T's exclusive hold on the popular devices
AP via MSNCB.com
NEW YORK - In a sign of warming relations between the two companies, Verizon Wireless is going to start selling Apple Inc.'s iPad at the end of this month, the companies said Thursday.
The news follows published reports that Verizon Wireless will start selling a version of the iPhone early next year. The companies have not confirmed the reports, and Verizon Wireless has downplayed the possibility of an iPhone for its current network.
AT&T Inc. is Apple's exclusive U.S. carrier for the iPhone. It's also the only U.S. carrier that's compatible with the "3G" version of the iPad, which allows for cellular data access.
BlackBerry bitten by PDF distiller security hole
By Ryan Naraine - ZDNet.com
A serious security flaw in the way Research in Motion's BlackBerry Enterprise Server processes PDF files could expose businesses to remote code execution attacks, the company warned in an advisory.
The vulnerability, discovered in the PDF distiller of the BlackBerry attachment service for the BlackBerry Enterprise Server, could allow a hacker take control of the computer that the BlackBerry Attachment Service runs on. Here's the gist of the problem from RIM's advisory:
The vulnerability could allow a malicious individual to cause buffer overflow errors, leading to a Denial of Service (DoS) condition or possibly arbitrary code execution on the computer that the BlackBerry Attachment Service runs on.
Human error gave spammers keys to Microsoft systems
By Robert McMillan - Computerworld.com
IDG News Service - Microsoft blamed human error after two computers on its network were hacked and then misused by spammers to promote questionable online pharmaceutical websites.
Microsoft launched an investigation Tuesday, after the problem was first reported in the Register. "We have completed our investigation and found that two misconfigured network hardware devices in a testing lab were compromised due to human error," Microsoft said Wednesday in a statement. "Those devices have been removed."
After they were compromised, the two servers were to handle the DNS of more than 1,000 fraudulent pharmaceutical websites, according to Ronald Guilmette, the managing member of network security software vendor Infinite Monkeys. He discovered the hacked Microsoft systems late last week while researching pharmaceutical spam. "This same group has hijacked quite a lot of machines all over the world," Guilmette said in an interview.
Online retailer respects customers' privacy Amazon cites First Amendment in North Carolina tax case
By Nancy Gohring - Computerworld
IDG News Service - Amazon and the American Civil Liberties Union argued in a Seattle court on Wednesday that North Carolina should drop its request for Amazon customer names combined with details like the titles of books they've purchased, and be forbidden from asking for such information in the future.
The case is rooted in North Carolina's investigation into whether it should tax Amazon for sales in the state. Last year, the North Carolina Department of Revenue asked Amazon for information regarding products sold to people in the state. Amazon complied with the request, which it called vague, by sending the state a detailed list of the products, including book and video titles.
Metals: Seam stress
By Jack Farchy and Javier Blas in London - FT.com
At the San José mine in northern Chile, the world's attention is focused on workers being pulled out of the ground one by one after a spectacular rescue operation. Emerging to breathe fresh air after 69 days underground in the copper mine, Florencio Avalos, a 31-year-old father of two, was welcomed by a crowd chanting: "Chile! Viva Chile!"
The story of Mr Avalos and his fellow miners, rescued through a small shaft more than half a kilometre deep, is not just one of survival against the odds: it also tells of the difficulties - and dangers - of extracting metals that are becoming ever scarcer.
Not far from the jubilant scenes at San José is the world's largest copper mine, Escondida, where 20 years of digging have left a hole the size of downtown Manhattan.
The Tea Party's Brain One way to measure the surprising rightward political lurch of the past two years and rise of the Tea Party is to chart the relative position of Ron Paul, who has never flinched from his beliefs. He's not alone anymore.
By JOSHUA GREEN - TheAtlantic.com
RON PAUL LED the annual Fourth of July parade through Friendswood, Texas, from the back of a gleaming pickup truck that inched along behind a replica of the Liberty Bell and just ahead of Lady Liberty herself, who was sitting in a Corvette and seemed to have wilted under the oppressive noonday sun. Or perhaps the oppressive policies of Barack Obama - it was hard to tell which. Along the parade route, the Stars and Stripes vied for prominence with STOP OBAMA signs.
Friendswood lies just south of Houston, in a district that voted 2-to-1 for John McCain, and for George W. Bush before him. But the distinctive flavor of the local conservatism is most vividly conveyed by Paul, the 75-year-old arch-libertarian congressman and sometime presidential candidate whose disdain for federal power is so severe that he once voted to deny Mother Teresa the Congressional Gold Medal because the Constitution does not expressly authorize such an expenditure. Paul thinks the government ought to be doing a whole lot less, and his constituents seem to agree. They've been returning him to Congress since the 1970s by growing margins.
U.S. Backs Taliban Talks Military Facilitates Meetings of Rebels, Kabul, in Sign of Support for Peace Deal
By ADAM ENTOUS in Brussels/ JULIAN E. BARNES - WSJ.com
U.S.-led forces in Afghanistan have facilitated the passage of senior Taliban leaders to Kabul for talks with President Hamid Karzai's government, signaling a shift by the U.S. to more active support of Afghan reconciliation efforts.
The U.S. military has said in the past that Mr. Karzai's efforts to broker peace with the Taliban were premature.
But a senior North Atlantic Treaty Organization official said the allied force was now offering direct help for preliminary peace talks between the Afghan government and the Taliban, which has strong influence in big swaths of the country.
NATO Chief Calls for Anti-Missile System to Protect Europe, North America
By Slobodan Lekic, Associated Press
Brussels (AP) - NATO's secretary general urged member states on Thursday to endorse a proposed anti-missile system that would protect Europe and North America, saying that is the alliance's responsibility.
Anders Fogh Rasmussen said NATO's new mission statement -- expected to be adopted at a summit of alliance leaders next month in Portugal -- would focus on reforming the organization to deal with emerging threats.
Ahmadinejad Heads to Border With Israel
By Bassem Mroue and Lee Keath, Associated Press via CNSNews.com
Beirut (AP) - Hezbollah supporters used mosque loudspeakers Thursday to rally crowds ahead of a trip by Iran's president to southern Lebanon near the border with Israel, a visit the U.S. and Israel have called intentionally provocative.
Mahmoud Ahmadinejad arrived in Lebanon on Wednesday to a rapturous welcome organized by Hezbollah. His country is the main patron of the Shiite militant group, the most powerful military force in Lebanon.
ISRAEL: Iranians at the gates - what to do?
LATimes.com
Israel often warns that Iran is at its gates, waging war by proxy from both south and north. Iranian President Mahmoud Ahmadinejad's visit to Lebanon brings Iran to Israel's northern gate in the flesh, and the question many are asking is what to do.
Nothing, is the official answer. The high-profile visit is being met with a low-key response. We don't need a campaign, said Foreign Ministry sources this week, Ahmadinejad does his own negative PR and is "his own worst enemy."
"The Lebanese are the first to understand the grave implications for their country, we needn't intervene," spokesman Yigal Palmor said.
Uzi Rabi, head of Middle East studies at Tel-Aviv University, echoed this sentiment. The best PR for Israel's policies on the matter is Ahmadinejad himself, he said. "Let him say what he wants and let Israel make the best use of it," Rabi said in a radio interview Wednesday. Rabi alluded to the wider context of the visit, noting Ahmadinejad's eroding support within Iran and the tribunal investigating the assassination of former Lebanese Prime Minister Rafik Hariri, which is believed will finger Hezbollah. Among other things, Rabi said, the visit is a clear statement to the West that its efforts to "transfer Lebanon to the 'right camp' have failed."
Bank of America has $2.3 trillion in assets but $956 billion of that is made up in loans.Think those loans are valued at current market levels? The FDIC would have a challenge even breaking up one too big to fail bank. MyBudget360.com
The FDIC has a herculean challenge in confronting the too big to fail banks. There is little doubt that having institutions that are too big is part of the reason for the current systemic crisis. Yet through the last few years the solution has been to make these banks even bigger allowing their web to spread even further and deeper into the economy. The FDIC has an insolvent Deposit Insurance Fund (DIF) backing up $13 trillion in banking assets. And what the banks call assets is simply stunning. Bank of America for example has $2.3 trillion in assets (or a larger amount than the annual GDP of California). Yet 41 percent of the assets are backed by loans, predominately real estate loans.
America should open its vaults and sell gold
By Edwin Truman -FT.com
Gold is back in the news. Its price is soaring in what some analysts say is a reflection of a weak economy and a lack of confidence in government policies. Naturally, investors are looking at a new sure thing in the expectation that prices will continue upward. My advice to the US government, however, is that this may be the best time - to sell. Doing so would help President Barack Obama and Congress reduce indebtedness, at little cost.
It is an article of faith in bullion markets that the US will be the last country to dispose of its gold stock. For 30 years it has had a no-net-sales policy for reasons ranging from resistance by US gold-producing interests to concerns about the international monetary system. That assumption may remain plausible. Yet the administration has an obligation to re-examine its policy.
The American Housing Market Is Headed for Total Destruction
By Dan Denning - WhiskeyAndGunpowder.com
The issue with the recent robo-signing scandal is that clear title could disappear in the American mortgage market. Part of the outrage is that U.S. banks have been foreclosing on mortgages which they don't even own. Part of the reality is that the convoluted process of securitisation means banks may not be able to prove at all they actually do own the mortgages.
Already large unions in the U.S are encouraging borrowers to challenge banks to prove they won your mortgage. They've set up a website asking the question, "Where's your note?"
You can see where this is headed. No one in America wants to own a failure. The banks want to foreclose on homes and sell them and avoid taking losses. Borrowers (some of them, and some of them rightly) want to avoid paying a debt for an asset that's worth less. No one wants to be responsible anymore because the most lucrative and least painful route is to abandon responsibility and your word.
Is There A Mortgage-Bond Scandal Brewing
That Will Dwarf Goldman's Abacus
Joe Weisenthal - BusinessInsider.com
As the fallout over Foreclosure-Gate crisis -- which is really a scandal regarding paperwork and securitization -- Felix Salmon has a new report based on some digging he's done into what he sees as a major mortgage-bond scandal.
The gist is basically this: During the boom, the major banks would hire a third party -- usually a firm called Clayton Holdings -- to "taste" some mortgages in a pool after the bank had acquired them. Basically, they'd re-underwrite a sample of a mortgage pool to see if the mortgages were of the advertised quality.
When bad mortgages turned up, the bank could sell those mortgages back to whomever they bought them from, but rather than try to return all the bad mortgages in the lot, they'd simply renegotiate the price of the whole pool (using Clayton's sample as a benchmark for the whole lot).
Gold rebounds as dollar weakens Federal Reserve meeting minutes show monetary easing may be needed soon Reuters - GilfNews.com
Singapore: Gold gained half a per cent yesterday, supported by the weakness in the dollar, after minutes of a Federal Reserve meeting showed monetary easing might be needed soon, while palladium rose to its highest level in a week.
US Federal Reserve officials believed in September the struggling recovery might soon need more help, and they discussed several ways to provide support, including the possible adoption of a price-level target.
The dollar paused its rebound and edged lower against a basket of currencies on Wednesday.
Bullion has been trading in a narrow range of less than $20 (Dh73.40) this week, and is seen to be consolidating after a record-breaking rally took gold to an all-time high of $1,364.6 last week. Bullish sentiment is intact, traders and analysts said.
CAN THE G-20 AND THE I.M.F. BURST THE "GOLD BUBBLE?"
by Julian Phillips - FinancialSense.com WHO RUNS THE I.M.F.?
There is a popular assumption that the I.M.F. is a global body representative of all and equally so. The perception includes the belief that their recommendations are independent of government. The body is empowered by its members to address all matters affecting the world's monetary system. Included in this perception is the money sponsored by the I.M.F. called "Special Drawing Rights", a money creation that allows it to lend to distressed nations facing Sovereign Debt crises, such as we have seen of late. If this were true, there is no doubt that it would have the competence and power to fix the global monetary system.
But these perceptions stray significantly from reality. For instance, let's look at the voting structure in the I.M.F. Each member is entitled to a percentage of the voting power from less than 1% upwards. It takes 85% of all members' votes to pass any I.M.F. resolution. The largest holder of voting rights is the U.S. which holds 16.74% of the votes. This allows it to veto any resolution it wants to. While this does not make it a pawn of the U.S., it does prevent any resolution being passed that it alone does not want passed.
Financiers Offer Terms to the Rest of World in the Currency Wars
JESSE'S CAFÉ AMÉRICAIN Anglo-American financiers to the Rest of World: We've a Gun to Our Heads, Better Surrender.
"To put it crudely, the US wants to inflate the rest of the world, while the latter is trying to deflate the US. The US must win, since it has infinite ammunition: there is no limit to the dollars the Federal Reserve can create. What needs to be discussed is the terms of the world's surrender: the needed changes in nominal exchange rates and domestic policies around the world."
Destroy the world economy by trashing the global reserve currency? Yes we can.
G-20 Should Mull Currencies Agreement, Niall Ferguson Says
By Brett Miller
Oct. 13 (Bloomberg) -- Group of 20 leaders meeting next month ought to discuss a plan to strengthen undervalued currencies, similar to the Plaza Accord in 1985, Harvard University historian Niall Ferguson said.
"The real currency war is actually between Chimerica -- China plus America -- and the rest of the world," Ferguson said in an interview at the World Knowledge Forum in Seoul. "It would be much better to have some kind of Plaza-like international agreement and I very much hope that at the G-20 summit in Seoul next month this will be No.1 on the agenda."
Krugman, Niall Ferguson Renew Debate Over U.S. Fiscal Stimulus
By Bomi Lim and Michael Heath
Oct. 13 (Bloomberg) -- Nobel Prize-winning economist Paul Krugman and Niall Ferguson, author of "The Ascent of Money: A Financial History of the World," clashed anew today over how to revive the U.S. economy.
Krugman, 57, a Princeton University professor, is urging the Obama administration to undertake a second round of fiscal stimulus, while Harvard University historian Ferguson, 46, warns such a course may trigger a "debt spiral" in the world's biggest economy.
Geithner Signals China Causing Global Currency Interventions
By Ian Katz and Brendan Murray
Oct. 13 (Bloomberg) -- U.S. Treasury Secretary Timothy F. Geithner blamed China's policy of limiting gains in the yuan for contributing to a round of capital controls and currency-market interventions by emerging economies.
"What's happening is, as China holds its currency down, their currencies are moving up and they're having to work very hard to make sure they're not at an unfair disadvantage with China," Geithner said in an interview with "Charlie Rose" scheduled to air on PBS yesterday and Bloomberg Television today.
U.S. must balance selling to China with currency concerns
By Kathy Chu, USA TODAY
GUANGZHOU, China - At an upscale department store in China's third-largest city, Almond Roca candy from Washington competes with traditional Chinese sweets. Supermarkets here sell Washington apples and cherries. And the state's Boeing planes crowd the skies.
As the global economic malaise drags on, and the U.S. seeks to reduce its reliance on the debt-fueled consumption that triggered the financial crisis, exports are becoming increasingly important to the nation's growth. China is now the third-largest export market for the U.S. - behind Canada and Mexico - and the fastest-growing. From 2000 to 2009, exports to China surged 330% while exports to the rest of the world rose 29%, U.S. Department of Commerce figures show.
China Foreign-Exchange Reserves Jump to $2.65 Trillion
By Bloomberg News
Oct. 13 (Bloomberg) -- China's foreign-exchange reserves, the world's largest, surged by a record to $2.65 trillion at the end of September, adding fuel to complaints that the nation's curbs on gains in the yuan are undermining the global recovery.
Currency holdings rose about $194 billion in the third quarter, today's statement from the People's Bank of China showed. September exports were the second-highest on record at $145 billion, a separate customs bureau report showed.
China still stockpiling foreign currency
By Chris Isidore - CNNMoney.com
NEW YORK (CNNMoney.com) -- In the latest sign that the Chinese could be keeping the yuan artificially undervalued, China's currency reserves jumped in the third quarter, to one of the highest levels on record.
China announced in June that it would allow yuan, which had been locked in value to the dollar since 2008, to begin trading more freely. And it has increased by a bit more than 2% versus the dollar over the last six weeks.
But Mark Williams, Senior China Economist for Capital Economics, said the Chinese report Wednesday of a $194 billion rise in the value of Chinese foreign currency holdings during the third quarter is one of the biggest on record and a sign that intervention by the People's Bank of China is far from over.
Soros: We're Moving Towards A New World Where Everybody Wants To Control Their Currencies Like China
Vincent Fernando, CFA - BusinessInsider.com
China's yuan-dollar exchange rate has been the secret to China's success according to George Soros speaking to the Financial Times.
The trade surplus created by the yuan-dollar peg allowed China to cruise through the financial crisis relatively unscathed and massive currency reserves it created provide a powerful bargaining position when China deals with other countries.
The Monetary Breakdown of the West
Mises Daily: by Murray N. Rothbard
To understand the current monetary chaos, it is necessary to trace briefly the international monetary developments of the 20th century, and to see how each set of unsound inflationist interventions has collapsed of its own inherent problems, only to set the stage for another round of interventions. The 20th-century history of the world monetary order can be divided into nine phases. Let us examine each in turn.
Phase I: The Classical Gold Standard, 1815 - 1914
Phase II: World War I and After
Phase III: The Gold-Exchange Standard (Britain and the United States) 1926 - 1931
Phase IV: Fluctuating Fiat Currencies, 1931 - 1945
Phase V: Bretton Woods and the New Gold-Exchange Standard (the United States) 1945 - 1968
Phase VI: The Unraveling of Bretton Woods, 1968 - 1971
Phase VII: The End of Bretton Woods: Fluctuating Fiat Currencies, August - December 1971
Phase VIII: The Smithsonian Agreement, December 1971 - February 1973
Phase IX: Fluctuating Fiat Currencies, March 1973 - ?
Why America is going to win the global currency battle
By Martin Wolf - FT via JESSE'S CAFÉ AMÉRICAIN
Currencies dominated this year's annual meetings of the International Monetary Fund. More precisely, two currencies did: the dollar and the renminbi, the former because it was deemed too weak and the latter because it was deemed too inflexible. But, behind the squabbles, lies a huge challenge: how best to manage the global economic adjustment.
In his foreword to the new World Economic Outlook, Olivier Blanchard, the IMF's economic counsellor, states: "Achieving a 'strong, balanced and sustained world recovery' - to quote from the goal set in Pittsburgh by the G20 - was never going to be easy ... It requires two fundamental and difficult economic rebalancing acts."
Schwarzenegger Blames Congress for 'Crippling' U.S. Recovery
By Ryan Chilcote and Lucian Kim
Oct. 12 (Bloomberg) -- California Governor Arnold Schwarzenegger blamed the sluggish economic recovery in the U.S. on legislative paralysis as he took his message of budget cuts to a global audience.
"The United States right now is crippled by Congress not doing anything that has to do with reforming, no matter if it's immigration reform or having an energy policy," Schwarzenegger said in an interview with Bloomberg Television today in Moscow.
Foreclosure Fraud: It's Worse Than You Think
By: Diana Olick - CNBC Real Estate Reporter
There has been plenty of pontificating over the ramifications of foreclosure freezes on troubled borrowers, foreclosure buyers and the larger housing market, not to mention lawsuits, investor losses and bank write downs.
There has been precious little talk of what the real legal issues are behind the robosigning scandal. Yes, you can't/shouldn't sign documents you never read, but that's just the tip of the iceberg. The real issue is ownership of these loans and who has the right to foreclose. By the way, despite various comments from the Obama administration, foreclosures are governed by state law. There is no real federal jurisdiction.
Banks Looking Further Than Robo Signers; "Lost Note" Affidavits a Point of Failure
NakedCapitalism.com
As readers no doubt know, we've indicated from early on in the foreclosure crisis that problems with foreclosures of mortgages held by securitizations went well beyond the now well known "robo signer" issue. The most difficult to resolve and apparently widespread problem is the failure to convey the note (the borrower IOU) properly to the trust (the legal entity that holds the notes on behalf of the investors) as specified in the pooling and servicing agreement.
"Robo-signing" Is Not Even The Big Issue
HousingDoom.com
.... Just how big is this problem? Morgan Stanley says that the validity of up to 9 million foreclosures could be brought into question. Even the validity of normal sales in the market is being questioned in some circles. This is liable to further shake confidence in a housing market that Americans already mistrust- to say nothing of what happens to the banks. Remember what happened to Lehman Brothers after they experienced massive losses in the subprime mortgage market. What happens when it is all shown to be "subprime"?
Banks Laundering Counterfeit Mortgages, The Largest Financial Fraud in World History!
By Washington's Blog
A "false front" building from the Old West. Towns built false fronts to make the town look more substantial and prosperous than it really was.
The tidal wave of evidence showing that the giant banks have engaged in fraudulent foreclosure practices is so large that the attorneys general of up to 40 states are launching investigations.
People's homes are being taken when they didn't even hold a mortgage, and the big banks have been using "robo signers" to forge mortgage related documents. Indeed, even president Obama has been hit by robo signers.
Here's What You Can Do: Demand Your Mortgage Note
By Mac Slavo - SHTFplan.com
Several weeks ago, before the mortgage foreclosure mess went mainstream, we alerted our readers to serious problems in the electronic mortgage transfer systems. Because of these electronic systems it is difficult, if not impossible, for banks and mortgage service companies to determine the rightful owner of the note and which company is legally allowed to service the mortgage payments.
Since then, we've seen GMAC, Bank of America, and a host of other banks cease foreclosures across the country under pressure from various Attorneys General.
The question on the minds of Americans who are in foreclosure, delinquent on payments, or are making payments but not sure if they are paying the right company is: Do I have to keep paying, and if I don't will they take my house?
Florida's 30-Second Foreclosure Dash Hits Wall of Fraud Claims
By David McLaughlin
Oct. 13 (Bloomberg) -- Home to more foreclosures than 47 U.S. states, Florida sought to clear out its backlog with a system of special court hearings that dispensed with cases quickly, sometimes in less than a minute.
Homeowners like Nicole West now threaten to slow that system, Florida's so-called rocket docket, to a crawl. West, who has been fighting to save her Jensen Beach house from foreclosure, has leveled a new allegation in her three-year battle: the entire process is based on fraud.
Sacrificing servicers on the altar of Hamp
Posted by Tracy Alloway FT.com.
We like to think of the foreclosure scandal as Hamp on super-steroids, with a hefty dose of litigation and structured finance for added fun.
Recall that the US administration's mortgage modification program was aimed simply at keeping people in their houses. The foreclosure freeze does this too, albeit somewhat inadvertently.
What's perverse about this moratorium is that it's mostly self-imposed. A number of mortgage servicing companies have decided to postpone foreclosures in recent weeks.
As Moe Tkacik at Washington City Paper notes, "banks do not just walk away from a cash cow like mortgage servicing without a good reason." In fact, one of the major sticking points to previous loan modification programmes was that the schemes failed to tackle the issue of servicer incentives.
Title Insurance Woes Illustrate Liabilities of Foreclosue MessConcentrated in TBTF Banks
NakedCapitalism.com
There are so many fronts to the foreclosure crisis that it's now becoming difficult to stay on top of all of them.
One development Monday that didn't get the attention it deserved is the fact that Bank of America is now eating title insurance liability on foreclosed properties sold by its servicer. Per Bloomberg:
Bank of America's agreement with Jacksonville, Florida- based Fidelity National calls for the lender to cover the title insurer's costs in the event of an error in the company's processing of foreclosure documents, Sadowski said. The bank will notify the insurer in each case that the foreclosure complies with state laws and regulations.
What Is MERS and What Role Does It Have in the Foreclosure Mess?(Hint: It Holds 60% of All Mortgages, But Has ZERO Employees)
Washington's Blog
You've heard the name Mortgage Electronic Registration Systems or "MERS" mentioned in relation to the foreclosure problems in the residential real estate market.
But what is MERS?
It is the company created and owned by all of the big banks to process title to property in the U.S. Approximately 60% of the nation's residential mortgages are recorded in the name of MERS.
MERS is a shell corporation with no employees, but thousands of officers.
As the treasurer and secretary of MERS admitted in a deposition:
Q Does MERS have any salaried employees?
A No.
Q Does MERS have any employees?
A Did they ever have any? I couldn't hear you.
Q Does MERS have any employees currently?
A No.
Q In the last five years has MERS had any
employees?
A No.
Q To whom do the officers of MERS report?
A The Board of Directors.
50 state attorneys general announce foreclosure probe
By Ariana Eunjung Cha and Dina Elboghdady - Washington Post
The attorneys general of all 50 U.S. states announced Wednesday that they are joining to probe mortgage loan servicers who are accused of submitting false affidavits, but they stopped short of calling for a national moratorium.
The multistate investigation will initially focus on whether Bank of America, J.P. Morgan Chase, Ally Financial and other large mortgage companies made misleading or fraudulent statements to evict struggling borrowers from their homes.
Indiana Attorney General Greg Zoellersaid investigators initially will focus on whether industry employees - so-called "robo-signers" - signed off on thousands of foreclosures every month without reviewing the files as legally required. Homeowner attorneys also allege that lenders forged signatures and improperly notarized documents.
U.S. urges lenders to vet foreclosures but keep process moving
Zachary A. Goldfarb and Ariana Eunjung Cha - WashingtonPost.com
Federal regulators on Wednesday urged the nation's lenders to verify that paperwork filed as part of the foreclosure process was properly reviewed and to file new documents if problems are found.
But regulators also said that lenders should continue as quickly as possible with foreclosures when no problems are found. Their comments, fashioned in close consultation with the Obama administration, demonstrate how federal officials and the White House are at odds with Democratic leaders in Congress, who favor a national freeze on foreclosures.
Wal-Mart U.S. Sales Not Bouncing Back
By Matthew Boyle
Oct. 12 (Bloomberg) -- Wal-Mart Stores Inc. may fail to turn its sales around by the holiday season as executives have forecast since the discount retailer has yet to lure customers back to stores, according to Cleveland Research Co.
Wal-Mart aimed to revive sales at U.S. stores open at least a year by returning items to shelves and revamping promotional displays. Those moves haven't worked yet because of poor in- store execution and a lack of advertising to explain changes to customers, Cleveland's Jeff Stinson said in a report today.
N.Y. Faces $200 Billion in Retiree Health Costs
By MARY WILLIAMS WALSH -NYTimes.com
The cities, counties and authorities of New York have promised more than $200 billion worth of health benefits to their retirees while setting aside almost nothing, putting the public work force on a collision course with the taxpayers who are expected to foot the bill.
The total cost appears in a report to be issued on Wednesday by the Empire Center for New York State Policy, a research organization that studies fiscal policy.
It does not suggest that New York must somehow come up with $200 billion right away.
Petty Socialism Compells Governments to Introduce the "Fat Tax"
By: J M Finegold Catalan - MarketOracle.co.uk
Rising healthcare costs and continuing recession-related fiscal problems have impelled numerous world governments to introduce a "fat tax."[1] Support for a similar policy is growing in the United States, which according to leading intellectuals suffers from a collective "weight problem."
Fast-rising weights and a general deterioration of health have increased the volume of weight-related medical issues. The implications for countries burdened with socialized medicine (including the United States, which suffers from a government-restricted insurance market that provides limited federal healthcare in the form of Medicare and monetary aid to the poor) consist in an increased monetary burden for society as a whole.
Jobless America threatens to bring us all down with it A depression may have been averted, but nothing has been fixed. This is the depressingly downbeat message that came across loud and clear from last weekend's annual meeting of the International Monetary Fund. By Jeremy Warner, Telegraph.co.uk
The destructive trade and capital imbalances of the pre-crisis era are back, banking reform appears stuck in paralysing discord, public debt in many advanced economies remains firmly set on the road to ruin, and the spirit of international co-operation that saw nations come together to fight the crisis has largely disappeared.
This was not where we were meant to be in tackling the underlying causes of the crisis and returning the world to sustainable growth. Yet beneath this sense of frustration at lack of progress - and at international organisations such as the IMF and the G20 to bring it about - there is an underlying truth that's often left unspoken; many of the problems in the world economy right now are not international at all, but US specific and can only really be solved by America itself.
Legal Battle Over Health Care 'Reform' Quickens
By Ilya Shapiro - CNSNews.com
Last week, a federal judge in Michigan dismissed part of a lawsuit challenging the constitutionality of this year's health care reform. Specifically, the Clinton-appointed Judge George Steeh ruled that Congress's power to regulate interstate commerce - the Commerce Clause - provided the constitutional warrant for the requirement that everybody buy health insurance (the "individual mandate").
And yet, even as Judge Steeh explained that Supreme Court precedent swept into federal regulatory purvey local activities that have a "substantial effect on interstate commerce," he admitted that the Supreme Court "has never needed to address the activity/inactivity distinction advanced by plaintiffs because in every Commerce Clause case presented thus far, there has been some sort of activity."
44 Charged in Huge Medicare Fraud Scheme
By WILLIAM K. RASHBAUM AND MICHAEL WILSON - NYTimes.com
An Armenian-American crime syndicate stole the identities of doctors and thousands of patients and used them and more than a hundred spurious clinics in 25 states to bill Medicare for more than $100 million for treatments no doctor ever performed and no patient ever received, the federal authorities announced on Wednesday.
Prosecutors said the case represented the largest Medicare fraud operation ever carried out by a single group that resulted in criminal charges. The group succeeded in stealing $35 million in Medicare reimbursements, officials said, before the charges were leveled and arrests were made on Wednesday.
F.C.C. Wants to Stop Cellphone 'Bill Shock'
By EDWARD WYATT - NYTimes.com
WASHINGTON - The Federal Communications Commission will propose rules on Thursday requiring mobile phone companies to alert customers by voice or text message when they are have reached monthly usage limits and are about to incur extra charges, the commission's chairman said Tuesday.
Julius Genachowski, the F.C.C. chairman, will propose what he calls the commission's consumer empowerment agenda, aimed at ensuring that users of new technologies do not have to worry about hidden costs, confusing billing practices and what the commission calls "bill shock."
Debunking The DOJ's Hit Piece, Part 3: Assault on The Second Amendment
Richard Anatone - The Intel Hub
In part 1 and part 2 of this exploratory essay, we learned that the Federal Government's Department of Justice has issued a glossary to be distributed to law enforcement officers throughout the country - a glossary called "Investigating Terrorism and Criminal Extremism: Terms and Concepts," where we find definition after definition of terms used by people who they categorize as "Domestic Terrorists."
We were not only shocked to find terms like "Constitution Party," "Precious Metals," "Council on Foreign Relations," "Patriot Movement," "Gold and Silver," and dozens more in this glossary of terrorist terminology, but that the definitions were misleading and ill-defined at best. In this last of three parts, we explore the Government's attempt at portraying gun owners and the "militia movement" as arms of domestic terrorism, and how we can peacefully return sanity to our Government.
FACEBOOK & SOCIAL MEDIA: A CONVENIENT COVER FOR SPYING
By Ralph Forbes - AmericanFreePress.com
Longtime AMERICAN FREE PRESS readers may recall that DARPA (Defense Advanced Research Projects Agency) has some creepy tentacles: the Information Awareness Office (IAO); TIA (Total Information Awareness, renamed Terrorism Information Program); and TIPS (Terrorism Information and Prevention System). By 2003, an irate American people forced the government to drop these spooky command-and-control police state operations - or did they?
The "vampire coven" was seemingly dead and buried - but was the stake actually driven through its evil heart?
In 2002, Divya Narendra had an idea for a social network site. By the fall of 2003, she and twin brothers Cameron and Tyler Winklevoss were looking for a web developer who could bring their idea to life. On Nov. 30, 2003 they hired Mark Zuckerberg to finish their program's codes. Little did they know what a monster Zuckerberg would hatch.
New U.N. Security Council Makeup Could Pose Challenges for U.S.
By Patrick Goodenough
(CNSNews.com) -The election on Tuesday of five new U.N. Security Council members sets up a challenging year ahead for the United States. The five new members begin their two-year terms next January.
Although non-permanent members do not have veto power, their views do carry weight as the UNSC requires the support of nine of the total 15 members to pass resolutions.
On issues ranging from keeping up international pressure on Iran to acting against human rights abusers, the potentially most influential newcomers to the Council, India and South Africa, frequently have taken stands at odds with those of the U.S. and its Western allies.
Sheriff Says Mexican Investigator Was Decapitated
By April Castro, Olga Rodriguez - AP via CNSNews.com
(AP) - A Mexican police commander investigating the reported shooting of an American tourist on a border lake plagued by pirates has been decapitated and his head was found in a suitcase, a Texas sheriff says.
The death of Rolando Flores, commander of state investigators in Ciudad Miguel Aleman, was a message from gangsters for investigators to "stay out of their territory," Texas Gov. Rick Perry said. Flores was part of a group investigating the reported shooting of David Hartley on Falcon Lake.
"I think their attempt is to intimidate law enforcement, no matter who they are or where they are," Perry told The Associated Press.
UFO Sightings in New York?
TheIntelHub.com
Today reports of UFO activity over New York City went ultra viral. Twitter erupted with reports of numerous unknown objects in the sky. This story has gone so viral that ABC and The New York Daily News are now reporting on it. We should remain skeptical as to the origins of this sighting until proof is put forward.
Remember the retired NORAD general who predicted a UFO visit on October 13, 2010?
ABC News 7 reports that indeed large groups of people were looking up into the sky at this unknown object. What this is remains to be seen.
Mystery shiny objects floating over Manhattan spark UFO frenzy
BY OREN YANIV, ROCCO PARASCANDOLA AND LUKAS I. ALPERT
NY DAILY NEWS STAFF WRITERS
A mysterious shiny object floating high over Manhattan's West Side set off a flurry of reports and wild speculation Wednesday that a UFO was flying over the city.
Police and the FAA said they began getting flooded with calls starting at 1:30 p.m. from people reporting a silvery object hovering high over Chelsea.
Law enforcement sources said they believed the object was likely some sort of balloon, but as of late Wednesday they had not confirmed exactly what it is.
Currency Wars: The Phantom Financial Menace
By Giordano Bruno - Neithercorp Press
War, almost every kind of war, is first and foremost a production. A piece of live-action theater with "good guys" and "bad guys" delineated by governments and by media for the benefit of the masses. Most plot-points in most modern conflicts are not genuine. They are written and staged (Gulf of Tonkin, or WMD's in Iraq anyone?), though we treat the fairytale as if it were reality simply because the story is being told by some corporate mouthpiece wearing a fake smile and a suit on our TV. Very often, we discover after the fact that the wars we witnessed in the dark shadows of our cultural cinema with greasy popcorn and mega-large soda in hand were actually a charade, a farce. We get angry, we get livid, and then we go on with our menial lives because the "damage is done" and what can we do about it now anyway? Very rarely in history do the majority of people have the ability or occasion to see the authentic war going on right in front of their eyes, between the social puppeteers, and those who have broken loose from their strings.
FDIC Floats Rules on Closing Firms Proposals Require Creditors to Take Hit and Allow Discretion on Who Gets Paid By DEBORAH SOLOMON - WSJ.com
WASHINGTON - Federal regulators proposed a rule that would require creditors of large financial firms to suffer losses in the event of a firm's collapse but left wiggle room for the U.S. to make payments to certain types of creditors.
The proposal is the first step in the government's effort to clarify how it will seize and dismantle large financial firms that run into trouble. The Federal Deposit Insurance Corp. was given authority to liquidate firms as part of the U.S. effort to prevent another collapse like that of Lehman Brothers, whose demise rippled through the financial sector.
The agency is expected to propose additional rules next year outlining how it would dismantle a large firm, including ways to recoup money from the financial industry in the event the U.S. has to step in and provide temporary funding.
Probe Targets Foreclosure Paperwork Tens of Thousands of Proceedings Are Suspected of Being Tainted; Return of the 'Robo Signers
By CARRICK MOLLENKAMP - WSJ.com
From Suite 350 at a suburban Atlanta office to a
bevy of law firms in Florida, thousands of documents were signed, and many sworn to, in order to ensure that foreclosure proceedings were sound.
Now, that work - at a mortgage-processing company called Lender Processing Services Inc. and four foreclosure law firms that processed documents on behalf of lenders such as GMAC Mortgage and Citigroup Inc. - is at the center of an investigation in Florida. Lender Processing and the four law firms are being investigated by the Florida attorney general. At issue is whether improper paperwork taints tens of thousands of foreclosures.
Small businesses' lament: Where are the customers?
LATimes.com
A gauge of small-business optimism inched up in September but remained stuck at levels typical of a "weak or recession-mired economy," the National Federation of Independent Business said Tuesday.
And once again, small firms' No. 1 complaint wasn't about taxes, government regulation or financing; it was about the lack of customers coming in the door.
The NFIB's optimism index added 0.2 of a point in September to 89, based on a survey of 849 small businesses nationwide.
The index had plunged to a record low of 81 in March 2009, then quickly rebounded to 88.9 two months later. Since then, however, it has mostly been stuck between 86 and 90, well below the range of 98 to 107 that is consistent with economic growth.
Will the US Economy Ever Again See Full Employment?
By Bill Bonner - The DailyReckoning.com
10/12/10 Buenos Aires, Argentina - How are things on the pampas?
Tolerably fair, it appears...
We just got here. Too soon to rush to judgment.
From what we can tell, though, the poor
Argentines seem to be shooting themselves in the footÉand the legÉand everywhere else. They're going to be taking out buckshot for years...
It should be a great time for the pampas. They have some of the richest, flattest, best-watered farmland in the world. Farm prices are high. Other prices are fairly low.
But leave it to the politicians to mess things up. Argentine beef - which ought to be the country's most prized export - is losing market share, especially to the Uruguayans. How come? Because the Argentines taxed beef exports in order to keep prices low at home. You see, the gauchos can manage an economy too!
The Robo-Signing Mess Is Just the Tip of the Iceberg, Mortgage Putbacks Will Be the Harbinger of the
Collapse of Big Banks that Will Dwarf 2008!
by Reggie Middleton - ZeroHedge.com
Now that the Robo-Signing scandals have achieved full notoriety through the media, it is time to address the real issues facing investors in bank stocks. I also believe that the media is staring at the wrong target. Each major media outlet is copying what is popular or what the next outlet broke as a story versus where the true economic risks actually lie - which is essentially the real story and where the meat actually is. Here's what's truly at stake - the United States is now at risk of losing its hegemony as the financial capital of the world! Why? Because when we had the chance to put the injured banks to sleep and redirect resources to into new productivity, we instead allowed politics to shovel 100's of billions in tax payer capital into zombie institutions as they turned around and paid much of it right back out as bonuses. As a result, significant capital has been destroyed, the original problem has metastized, and the banks are still in zombie status, but with share prices that are multiples of the actual values of the entities that they allegedly represent - a perfect storm for a market crash that will make 2008 look like a bull rally!
Gold price to hit $1,650/oz: Goldman Sachs
LONDON (Commodity Online): Bullion analysts have refused to dump gold even as more and more negative news filtered out of the US economy this week. The IMF issued a warning to nations about currency wars, sparking a price rise in bullion market.
The IMF warning came as a negative news for the global economy and investors rushed to buy gold to secure their moolah. Then came Goldman Sachs's announcement that it has upwardly revised its earlier forecast for gold price to $1,400 an ounce, $1,525/oz and $1,650/oz on three-, six- and 12-month horizons, respectively.
G-7 Squashes Currency Rally
By Chuck Butler - The DailyReckoning.com
10/12/10 St. Louis, Missouri - The currencies are much weaker this morning, after digesting the G-7 decision on Saturday, and all the saber rattling with China ... But in the real scheme of things, I would suggest to you that this weakness is nothing more than correcting a "too far, too fast" move by all the currencies following the FOMC meeting on Sept 21st.
Speaking of Sept. 21st, the minutes of that FOMC meeting will be on display for all to see this afternoon. Remember on Friday, I told you that there is some slippage in the thought that quantitative easing (QE) is a done deal for the November 2nd meeting of the FOMC ... Well, those thoughts are getting more air play, which is also causing some slippage in the currencies ... The FOMC meeting minutes should put those thoughts to bed, but there's uncertainty this morning, and with uncertainty you get currency weakness, that's just the way it is, some things will never change ...
Gerald Celente on The Nutrimedical Report
with Dr. Deagle 11 Oct 2010 - The GREATEST DEPRESSION
Dollar Trades Near 15-Year Low Versus Yen on Fed Policy Concern
By Candice Zachariahs and Catarina Saraiva
Oct. 13 (Bloomberg) -- The dollar traded near the weakest in 15 years against the yen and a record low versus the Swiss franc on speculation Federal Reserve officials will reiterate they are poised to resume bond purchase to support growth.
The Dollar Index, which tracks the greenback against major trading partners, was near its lowest since January after the Fed said yesterday in minutes of its September meeting that it was set to take more credit-easing steps "before long." The bank will announce increases in Treasury purchases, or so-called quantitative easing, in November, Goldman Sachs Group Inc. has said. The euro was near a nine-month high before a report likely to show European industrial production rose in August.
Dollar turns lower after Fed minutes
By Deborah Levine, William L. Watts and Wallace Witkowski
NEW YORK (MarketWatch) - The U.S. dollar turned lower on Tuesday against the euro, sending the shared currency back toward an eight-month high, after the September minutes from the Federal Reserve's Open Market Committee indicated several members wanted to resume buying massive amounts of long-term government bonds soon.
Earlier, reports of policy tightening in China and ongoing credit problems in Ireland and Greece boosted the greenback's appeal.
The dollar index, a measure of the U.S. unit against a basket of six major currencies, fell to 77.375 from 77.513 late Monday, after being around 77.576 before the Fed minutes were released.
Paul Says '12 Run Depends On Fall of U.S. Dollar
by Lindsey Boerma - HotLineOnCall.com
Texas Rep. Ron Paul (R) told reporters Saturday that the bulk of the economic crisis is yet to come, and that a White House '12 bid largely hinges on his anticipated fall of the U.S. dollar.
Prior to appearing before the Virginia Tea Party Patriots Convention in Richmond, Paul called a complete implosion of the U.S. currency system "95% likely... [because] right now the whole world is racing to beat their currencies because they think it's going to help trade...But let me tell you, if the bombs started to fall on Iran, hold your hat, because that would be, I believe, the end of our dollar system. And we would have a real skirmish to find out what we're going to replace this government with."
Inflation-linked bonds show more concerns than Fed
By Deborah Levine, MarketWatch
NEW YORK (MarketWatch) - The bond market is more worried about inflation than the Federal Reserve.
Inflation-protected securities, and the exchange-traded funds and mutual funds based on them, are rallying as investors in all asset classes are increasingly convinced the Fed will restart large asset purchases to pump up the U.S. economy.
With so much slack in the economy, Fed policy makers essentially said last month that it's their job to increase inflation. And one of the major readings on inflation - the consumer price index - due out Friday is expected to show inflation remains too tame for the Fed's comfort.
The Theory of Currency Relativity (A Continuing Expose' of Timmy's Lies)
ZeroHedge.com
As a follow up to my latest article in which I exposed Western Central Bankers for blaming foreign entities for domestically produced economic problems, I mentioned a theory of currency relativity. Yes, I do know that I published my original article with a typo in which I stated that US Treasury Secretary accused the Chinese government of fostering a strong yuan instead of a weak yuan. Yes, I deserved the criticism I received for what I admit to be a completely amateurish mistake when I accidentally switched the word "strong" and "weak" throughout my article.
Keiser Report No.85:
G-7 Gives China Currency Reminder 'At This Point,' Weber Says
By Rainer Buergin
Oct. 12 (Bloomberg) -- Group of Seven nations reminded China and other emerging nations of their promise for more currency flexibility, limiting themselves to a verbal notice "at this point," European Central Bank Governing Council member Axel Weber said.
The G-7 nations met over the weekend in parallel to the annual meetings of the International Monetary Fund, seeking more currency flexibility to ease global tensions. China rebfuffed the pressure, saying that its currency, the yuan, would be allowed to rise gradually.
"All we did at this point is remind authorities in surplus emerging market economies that they promised at the Toronto meeting, in the G-20, to increase the degree of flexibility of their exchange rate arrangements with respect to the major industrialized countries," Weber said today in New York. "At this point the simple reminder that you need to embark on that trajectory was the outcome of the G-7 meeting and is the main message I'd like to repeat."
Fed Chief Gets Set to Apply Lessons of Japan's History
By JON HILSENRATH - WSJ.com
As a Princeton professor in the 1990s, Ben Bernanke lectured Japanese officials for mishandling their economy.
Today, Tokyo's economic problems are more than academic for the Federal Reserve chairman. They are a window into his own situation as he stares at what could be a long period of slow growth, high unemployment and declining inflation in the U.S.
Mr. Bernanke is preparing for a potentially important policy speech Friday, when he could detail his thinking on the Fed's next steps at a conference sponsored by the Federal Reserve Bank of Boston on monetary policy in a low-inflation environment. The conference is a reprise of a 1999 conference at which Mr. Bernanke and other academics took Japanese officials to task for failing to get their economy moving.
Divided Fed is 'dysfunctional'
By Annalyn Censky, staff reporter
DENVER (CNNMoney.com) -- Financial markets are banking on another bond-buying spree by the Federal Reserve, but the central bank's policymakers aren't presenting a unified front on the controversial idea. The lack of a clear message could be one factor holding back the recovery, said several economists.
The Fed's policy making team is "dysfunctional," said Laurence Meyer, a former Fed governor, speaking Sunday in Denver at the conference for the National Association of Business Economics.
John Taylor, a Stanford University economist who spoke with Meyer, blamed the central bank for adding more uncertainty to the economy.
Fed Officials Were Prepared to Ease 'Before Long'
By Scott Lanman and Joshua Zumbrun
Oct. 12 (Bloomberg) -- Federal Reserve policy makers last month were prepared to ease monetary policy "before long" and focused on purchases of Treasury securities and boosting inflation expectations as ways to add stimulus.
Policy makers "wanted to consider further the most effective framework for calibrating and communicating any additional steps to provide such stimulus," the Fed said in minutes of the Sept. 21 session, released today in Washington. The Fed also said for the first time that it was considering targeting a path for the level of nominal gross domestic product as a way to increase price expectations.
Stimulus of $1 Trillion Adds Nothing to Deficit
Commentary by Frank Aquila
Oct. 13 (Bloomberg) -- Imagine if American companies could add more than $1 trillion to their domestic coffers in an instant without selling a subsidiary, issuing a single share or incurring a penny of debt.
While every company would no doubt use this cash differently, the windfall could fund a return of capital to shareholders through increased dividends and share buybacks. Or it could be used to repay debt, fund capital expenditures or make strategic acquisitions.
How the companies would deploy the money doesn't matter. The important thing is that the cash would be put to work. So why hasn't this already happened?
Fed signals next move could come soon
By Chris Isidore, senior writer
NEW YORK (CNNMoney.com) -- The Federal Reserve appears ready to take additional steps soon to try to jump start the economy, but there is sharp disagreement among policymakers on the best course of action.
Minutes of its Sept. 21 meeting of the Federal Open Market Committee appeared to lay the groundwork to take action, possibly as soon as its next meeting on Nov. 2 and 3.
"Several members noted that unless the pace of economic recovery strengthened or underlying inflation [rose] ... they would consider it appropriate to take action soon," according to the minutes.
Fed official: Stop asset buying, raise interest rates
By Annalyn Censky
DENVER (CNNMoney.com) -- Wall Street is counting on the Federal Reserve to announce another round of asset purchases next month. But not everyone on the Fed is in favor of that policy.
Speaking to a room full of economists in Denver, Kansas City Fed President Thomas Hoenig laid out several reasons for his opposition to the monetary policy known as quantitative easing, or buying up Treasurys as a way to push interest rates lower and stimulate more spending.
While the first round of quantitative easing in 2008 was effective, purchasing additional assets now wouldn't work, Hoenig said at the conference of the National Association of Business Economics, Tuesday.
The Fed's Zero Rate Policy is Destroying America
In this issue of The Institutional Risk Analyst, we turn the camera eye on two different perspectives on the continuing crisis affecting the U.S. economy, the Fed's deflationary monetary policy and the surging price of gold. We look at how the rapid changes now underway in how consumers and investors alike view the dollar will affect the risk picture facing banks, companies and individuals. BTW, tomorrow IRA cofounder Christopher Whalen will be travelling back to the heartland to visit our friends at Indiana State University. We will give a talk entitled: "Do Americans Need a New Deal?" More on this theme next week.
Last week The IRA traveled to Washington D.C. to participate in the latest event sponsored by our friend Alex Pollock at American Enterprise Institute, "Living in the Post-Bubble World: What's Next?" We received a great deal of media buzz before and after the event, but the most poignant comment came in this unexpected and very disturbing letter from Dianna in Rockford, IL
Wrecking the American Dream
By Stephen Lendman - Pravda.ru
Long planned, the current economic storm erupted violently in late 2007. It wasn't by accident. It was engineered years back, so financial racketeers could profit from wrecking global economies and destroying their middle class, including America's.
On February 1, 2009, former high-level Wall Street and government insider, Catherine Austin Fitts, explained it an article headlined, "Financial Coup d'Etat," saying:
A global financial cabal "engineered a fraudulent housing and debt bubble; illegally shifted vast amounts of capital out of the US; and used 'privatization' as a form of piracy - a pretext to move government assets to private investors at below-market prices and then shift private liabilities back to government at no cost to the private liability holder ... Clearly, there was a global financial coup d'etat underway," its magnitude overwhelming and incomprehensible to most people, as planned.
Embattled homeowner to bank: You don't own my loan
By Allan Chernoff, CNN Sr. Correspondent
(CNN) -- Replique D'Amelio plays with her two children on their spacious lawn well aware the threat of foreclosure hangs like a cloud above the Wappingers Falls, New York home.
D'Amelio, though, is confident she's found a legal strategy that will not only keep her in place, but could also stop mortgage bankers in their tracks as they attempt to lay claim to properties of hundreds of thousands of Americans who are delinquent on mortgage payments.
D'Amelio and her attorney, Linda Tirelli, are taking aim at the way the mortgage industry prepares legal documents used against delinquent homeowners. They charge the electronic filing system that the mortgage industry devised to facilitate the selling of mortgages from one financial party to another results in documentation that is faulty and therefore not legally binding.
Homeowner makes sign in foreclosure fight
It's his last hope to save his dream home
By: Mike Trim - WPTV.com
THE ACREAGE, Fla. - Juan Guzman has a large, lawn-wide sign in his front yard labeled 'JP Morgan Chase help.' It's his last hope to save his dream home.
The Acreage man built his house in 2007 but couldn't handle the mortgage payment of $3,600 a month.
He said he tried negotiating a lower loan from his bank but it wouldn't budge.
Last year Guzman became unemployed and now his house is in foreclosure.
Talking about his sign, Guzman said, "Trying to save my house, my family and my savings, life savings."
Guzman said his sign on his 82nd Lane home can be seen from an airplane.
Advice to Desperate Congressional Dems: Ignore Wall Street Puppet Obama, and Demand a Five-Year Freeze on All Home Foreclosures in the Spirit of the Frazier-Lemke Act of 1935!
Webster G. Tarpley, Ph.D. - TARPLEY.net
In the last phase of the election campaign, an issue has emerged which allows voters to separate Wall Street stooges in both parties from real advocates of the middle class. The issue is the massive campaign of foreclosures against the American middle class being carried out by Wall Street zombie bankers who owe their very existence to taxpayer bailouts. Since the world derivatives panic began in 2007, millions of homes each year have been seized by the Wall Street predators, sometimes under the legal color provided by adjustable rate mortgages and, as has now been revealed, often using completely illegal paperwork to throw average Americans and their families out on the street and frequently into poverty and destitution.
Why Foreclosure Fraud Is So Dangerous to Property Rights
By Barry Ritholtz
There seems to be a misunderstanding as to why the rampant and systemic foreclosure fraud is so dangerous to American system of property rights and contract law. Some of this is being done by people who are naked corporatists (i.e., the WSJ Editorial Board) excusing horrific conduct by the banks. Others are excusing endemic property right destruction out of genuine ignorance.
This morning, I want to explain exactly why this RE fraud is so dangerous, and explain the significance of the rights that are currently being trampled. I also want to demonstrate that the only way the nation could have the quantity and magnitude of errors we see is by willful, systemic fraud.
Lauderdale man's home sold out from under him in foreclosure mistake He paid cash
By Harriet Johnson Brackey, Sun Sentinel
When Jason Grodensky bought his modest Fort Lauderdale home in December, he paid cash. But seven months later, he was surprised to learn that Bank of America had foreclosed on the house, even though Grodensky did not have a mortgage.
Grodensky knew nothing about the foreclosure until July, when he learned that the title to his home had been transferred to a government-backed lender. "I feel like I'm hanging in the wind and I'm scared to death," said Grodensky. "How did some attorney put through a foreclosure illegally?"
Bank of America has acknowledged the error and will correct it at its own expense, said spokeswoman Jumana Bauwens.
S&P Chimes In On Foreclosure Fraud, Expects 6-8% Home Price Decline Through November 2011
by Tyler Durden - ZeroHedge.com
S&P finally chimes in on fraudclosure, and in combination with other recent weak data out of the home segment, now sees an additional 6-8% decline in prices through November 2011. "U.S. home sales and home prices aren't likely to improve as we move into the seasonally sluggish fall and winter months. Although the latest pending home sales, reported last week, showed a modest increase, generally slowing new and existing home sales in recent months, combined with declining mortgage purchase applications after the government's temporary tax credit for homebuyers expired at the end of April, lead us to expect the housing inventory to grow and home prices to fall in the months ahead. A range of other key factors are also weakening the housing market: An elevated level of short sales and distressed asset sales; a large backlog of shadow inventory that have yet to be brought to market; and a high national unemployment rate. The recent news that several major banks will delay foreclosures due to documentation issues may postpone the arrival of the backlog of distressed inventory to the market anytime soon. The foreclosure delay also supports our expectation that the housing recovery will be a slow one.
Foreclosure fiasco: The latest
By Charles Riley, staff reporter
NEW YORK (CNNMoney.com) -- Major mortgage servicers are broadening their investigations into the possible mishandling of foreclosures.
Ally Financial said Tuesday it has hired outside accounting and legal firms to examine its foreclosure procedures in all 50 states. That effort will not look at individual cases.
Ally also said it would review pending foreclosure sales to ensure that all documents are accurate.
In addition, Ally had previously announced that it was temporarily suspending evictions and post-foreclosure closings in the 23 states in which judges must sign off before someone loses their home.
Obama administration rejects nationwide foreclosure moratorium
By Stephanie Armour, USA TODAY
The Obama Administration on Tuesday rejected calls for a nationwide moratorium on foreclosures because of concerns it could cause broader harm to the housing recovery.
But a freeze on foreclosures is still widening.
Ally Financial's GMAC Mortgage said Tuesday that it's hired legal and accounting firms to conduct independent reviews of its foreclosure procedures in every state. GMAC has already delayed foreclosures in the 23 states that require a court approval to foreclose.
How much can we blame on state pensions?
By Ezra Klein - WashingtonPost.com
Wondering why New Jersey isn't finishing its much-needed commuter tunnel to New York? Easy, says David Brooks. Blame public employees, their pensions and their pay. "States across the nation will be paralyzed for the rest of our lives because they face unfunded pension obligations," he writes.
State pension systems are a problem. But they're not the problem right now. And they're certainly not what's standing between New Jersey and its tunnel. After all, Christie didn't fund the pension system this year. He simply skipped the $3.1 billion payment, saying he wouldn't add money to a "broken" system. If I didn't buy lunch today, you can hardly blame the cost of my lunch for the fact that I don't have bus fare.
GMAC Will Review Foreclosures in All 50 States
By DANNY KING - DailyFinance.com
GMAC Mortgage will review its foreclosure procedures in all 50 states, broadening an initial review that began about two months ago. The move follows Bank of America's (BAC) decision to do the same.
GMAC, which is a unit of Ally Bank, has hired a number of accounting and legal firms to go over its foreclosure procedures. The company earlier started reviewing foreclosure-related affidavits in 23 states, and in some cases halted the foreclosure process, though GMAC says it hasn't yet found evidence of "inappropriate" foreclosures.
California to join multistate inquiry of foreclosures by banks The task force will look into whether financial institutions violated laws by cutting corners when seizing homes. Several large banks have acknowledged paperwork errors.
By E. Scott Reckard and Jim Puzzanghera, Los Angeles Times
Reporting from Orange County and Washington - California will join a multistate investigation into whether banks violated laws by cutting corners while foreclosing on homes as the Obama administration made clear Tuesday it that would not support a nationwide moratorium.
The moves came as one of the nation's major lenders, Ally Financial Inc., said it would expand the review of its foreclosure practices nationally to include states such as California where courts do not hold jurisdiction over the process. The company stopped short of saying it would suspend foreclosure sales in all 50 states, as Bank of America Corp. did last week, while it conducted this review.
More Californians reverse course and head to Oklahoma
By Paul Wiseman, USA TODAY
OKLAHOMA CITY - Former Hollywood producer Neal Nordlinger, raising funds for a technology venture a couple of years ago, was stunned when a partner suggested locating the start-up here in Oklahoma's capital and leaving Los Angeles behind: "I said: 'Are you blankety-blank crazy? Oklahoma City? It's a cow town.' "
That was then. Now Nordlinger is running a software firm here and preaching the virtues of the heartland - low costs, unclogged streets, friendly people. "It's a dream here," he says. "The selling price of a house here would not be the down payment on a house in L.A. ... People in L.A. do something for you because there's something in it for them. Here, they genuinely want to help you succeed."
California to Sell 24 Government Buildings for $2.3 Billion
By: AP - CNBC.com
The state announced Monday it is selling 24 government office buildings - including the Ronald Reagan State Building in Los Angeles and the San Francisco Civic Center - to a group of private investors for $2.3 billion.
Ron Diedrich, acting director of the California Department of General Services, announced it selected the offer from California First LLC, a partnership led by a Texas real estate firm and an Orange County private equity firm.
About $1 billion of the sale will be used to pay off bonds on the buildings, leaving more than $1.2 billion to go into the state's general fund.
US Cities Face Half a Trillion Dollars of Pension Deficits
By: Nicole Bullock, Financial Times - CNBC.com
Big US cities could be squeezed by unfunded public pensions as they and counties face a $574 billion funding gap, a study to be released on Tuesday shows.
The gap at the municipal level would be in addition to $3,000 billion in unfunded liabilities already estimated for state-run pensions, according to research from the Kellogg School of Management at Northwestern University and the University of Rochester.
Recession job losses: Worse than first thought
By Chris Isidore, senior writer
NEW YORK (CNNMoney.com) -- As bad as job losses were during the recession, we're about to find out that things were even worse.
The government currently estimates that 2.2 million jobs were lost from April of 2009 through March of this year, a significant portion of the 7.8 million jobs lost since the start of 2008.
But in a little-noticed note at the bottom of September's jobs report, the Labor Department said it now appears there were 366,000 additional jobs lost during the 12 months that ended in March, a revision that is not yet included in the official numbers.
Obama Loses Support in Poll as Joblessness Prompts Discontent
By Mike Dorning
Oct. 12 (Bloomberg) -- Hope has turned to doubt and disenchantment for almost half of President Barack Obama's supporters.
More than 4 of 10 likely voters who say they once considered themselves Obama backers now are either less supportive or say they no longer support him at all, according to a Bloomberg National Poll conducted Oct. 7-10.
Three weeks before the Nov. 2 congressional elections that Republicans are trying to make a referendum on Obama, fewer than half of likely voters approve of the president's job performance. Likely voters are more apt to say Obama's policies have harmed rather than helped the economy. Among those who say they are most enthusiastic about voting this year, 6 of 10 say the Democrat has damaged the economy.
Health Care: Washington's Way or the Highway
By Peter Suderman - Reason.com
I haven't always been thrilled with state-level attempts to experiment with heath care policy. But as Tennesse's budget-busting Medicaid expansion showed, those experiments are easier to undo than federal policies. And even the failures can encourage small-scale policy innovation. The PPACA, in contrast, is going to force some states to give up their local policies in favor of federally-defined standardization. Case in point, Utah: Currently the state runs a streamlined health insurance exchange that state officials would like to keep. But they may be forced to scrap it in favor of a bulkier, costlier, federally approved model
Boehner's 'Plan B' for ObamaCare Hearings can be used to sell market-friendly fixes.
By William McGurn
When it comes to repealing ObamaCare, plan B for John Boehner (R., Ohio) will be more important than plan A.
Plan A, of course, is to repeal the new health-care law whole hog. If Republicans take the House in next month's elections, they will surely introduce - and pass - a bill to do so. The question is: What happens when that bill then goes nowhere in the Senate, where even a Republican majority will not be large enough to rebuff a filibuster, much less override a presidential veto?
Wal-Mart Stores to Start Selling Apple's iPad
By AP - Time.com
Wal-Mart Stores Inc. will start selling Apple Inc.'s iPad tablet computer in some stores by Friday and in a majority of locations by the height of the holiday shopping season.
The world's largest retailer will sell the iPad at Apple's suggested retail prices, which range from $499 to $829 depending on the model. It will be available online but must be picked up at stores.
By mid-November the iPad will be available in more than 2,300 of its roughly 3,600 stores in the U.S., Wal-Mart said.
Target Corp. began selling the iPad earlier this month. Best Buy Co. has carried the device since it came out in April.
Discount Schemes Aplenty: How Stores Lure You in and
Get You to Spend More Than You Planned
by BRAD TUTTLE - Time.com
How does a 50% off discount sound? What about an extra 30% off of merchandise that's already discounted by 40% or more? Or maybe a BOGO (buy one, get one for É free, or 50% off) is what'll make you bite?
All of these common retailer discounts have one thing in, well, common: They're aimed at enticing shoppers into stores, so that they'll buy the stuff that's on sale - and, while they're at it, they'll probably buy some stuff at full price as well. For the shopper, the rationale goes like this: Well, since I'm getting most of my stuff at 60% off, it's no big deal to pay retail for a couple of other items. I'm still getting a good deal in the grand scheme of things, right?
The Impossibility of an Informed Electorate
Mises Daily: by D.W. MacKenzie
Ordinarily I agree with John Stossel. Stossel does what many would have thought impossible: he uses economic reasoning to defend individual liberty and free markets on national media outlets. In a 2008 article Stossel claims that uniformed people should not vote. Stossel illustrates this idea by questioning audience members at a Rock the Vote concert. Many of the attendees of these events could not recognize pictures of the vice president or the Speaker of the House, and did not even know how many senators there are in the US Senate. Stossel suggests that people who lack such basic information have a duty not to vote. Conversely, people who are informed about politics should vote.
What's wrong with a world government and a global currency?
Bob Chapman answers the question on Goldseek radio 08 Oct 2010:
Council on American-Islamic Relations Launches 'Islamophobia' Division
By Patrick Goodenough
(CNSNews.com) - Spurred by the controversies over Quran-burning and the planned Ground Zero mosque, the most visible Islamic advocacy organization in the United States says it is launching a department to deal with "Islamophobia."
In doing so, the Council on American-Islamic Relations (CAIR) is following the example of the Organization of the Islamic Conference (OIC), the 57-member bloc of Islamic states. The OIC set up an "observatory" five years ago to monitor and report on incidents and trends around the world it regards as amounting to "Islamophobia."
Why Obama Is Losing the Political War
By Mark Halperin - Time.com
Barack Obama is being politically crushed in a vise. From above, by elite opinion about his competence. From below, by mass anger and anxiety over unemployment. And it is too late for him to do anything about this predicament until after November's elections.
With the exception of core Obama Administration loyalists, most politically engaged elites have reached the same conclusions: the White House is in over its head, isolated, insular, arrogant and clueless about how to get along with or persuade members of Congress, the media, the business community or working-class voters. This view is held by Fox News pundits, executives and anchors at the major old-media outlets, reporters who cover the White House, Democratic and Republican congressional leaders and governors, many Democratic business people and lawyers who raised big money for Obama in 2008, and even some members of the Administration just beyond the inner circle.
Twisted Patriotism
By RICHARD STENGEL - Editor, Time.com
True patriotism is not owned by any party or person. Nor is there a one-size-fits-all definition that would please all those who consider themselves patriots. We each define the idea - and act on it - in our own way. But there are some definitions that cross the line, that pervert patriotism and take it to a place that is hateful and dangerous. Barry Goldwater famously declared in his acceptance speech at the 1964 Republican Convention that "extremism in the defense of liberty is no vice." Fine. But some forms of extremism in defense of a misguided sense of liberty can be poisonous. And such noxious extremism can come from left or right - or anywhere.
In this week's powerful and disturbing cover story, Pulitzer Prize-winning investigative correspondent Barton Gellman explores the world of extreme antigovernment alienation, from the training protocols of America's militias all the way to the deranged plans of a neo-Nazi who sought to plant a dirty bomb in Washington. In recent years, rhetoric on the left and the right of the political spectrum has grown more incendiary, but both sides still aim to achieve their ends with ballots, not bullets. The story portrays those who believe that government is more than just the problem; they believe it is the enemy. The most extreme militants do not believe in change through peaceful means and think it is only a matter of time before they will have to take up arms against the federal government.
The Secret World of Extreme Militias
By Barton Gellman - Time.com
Camouflaged and silent, the assault team inched toward a walled stone compound for more than five hours, belly-crawling the last 200 yards. The target was an old state prison in eastern Ohio, and every handpicked member of Red Team 2 knew what was at stake: The year is 2014, and a new breed of neo-Islamic terrorism is rampant in Michigan, Illinois, Indiana and Ohio ... The current White House Administration is pro-Muslim and has ordered a stand-down against Islamic groups. The mission: Destroy the terrorist command post - or die trying. The fighters must go in "sterile" - without name tags or other identifying insignia - as a deniable covert force. "Anyone who is caught or captured cannot expect extraction," the briefing officer said.
At nightfall the raiders launched their attack. Short, sharp bursts from their M-16s cut down the perimeter guards. Once past the rear gate, the raiders fanned out and emptied clip after clip in a barrage of diversionary fire. As defenders rushed to repel the small team, the main assault force struck from the opposite flank. Red Team 1 burst through a chain-link fence, enveloping the defense in lethal cross fire. The shooting was over in minutes. Thick grenade smoke bloomed over the command post. The defenders were routed, headquarters ablaze.
***** Excellent! *****
Tom Woods at Nullify Now, Ft. Worth
U.S. May Not be Able to Maintain Nuclear Stockpile, GAO Reports
By Matt Cover
(CNSNews.com) - The National Nuclear Security Administration (NNSA) may not be able to reliably maintain the nation's nuclear stockpile in the near future, according to a report from the Government Accountability Office (GAO).
At issue is the production of a rare radioactive element known as tritium, which is used in the core of nuclear warheads to make the weapons more powerful. However, because tritium - like all radioactive elements - degrades over time, it must be replaced if the nuclear weapons are to remain in working order.
Ahmadinejad steps into a cauldron
By Victor Kotsev - Asia Times
Many observers have little respect for Israeli website Debka File, known for publishing intelligence leaks as well as occasional wild rumors. When I mentioned it to an Israeli analyst recently, he sneered at me. "This is where you go if you want to get your yellow pages," he said. Thus, when Debka cautioned a week ago that Iran was planning a military response to a recent cyber-attack [1] and that Hezbollah was setting to overthrow the Beirut government by force following the visit of Iranian President Mahmud Ahmadinejad to the country [2], the reports did not immediately attract attention.
However, it is now clear that something serious is afoot in Lebanon. There are rumors that Hezbollah will respond violently - even preemptively - to a widely expected indictment of some of its members by the United Nations-backed tribunal into the 2005 murder of ex-premier Rafik Hariri. These have become so widespread that even Hezbollah leader Hassan Nasrallah felt the need to address them on Saturday. He did this in a way that caused further alarm as it could be interpreted as a veiled threat. "If we wanted to [stage a coup], we would've done that in 2005," he said, adding: "We would've taken over the country on August 15, 2006 [after the Israel-Hezbollah summer war that year] if we wanted to, so these claims are unfounded."
Chinese gobble up Americans' pecans
By William Pack - Express-News
China's massive economic clout, exercised Monday in a multibillion-dollar energy investment plan, could be felt by U.S. consumers this holiday season if pecans and the holiday treats named for those nuts become as hard to find as expected.
No one is outright predicting there won't be enough pecans to go around for holiday cooks and candy makers to share with a Chinese population that increasingly has turned to the nut in recent years for nutrition. But pecan prices are expected to be high and the market tight.
Some lower-quality pecan varieties might have to fill in for the higher-quality nuts if Chinese demand reaches the level it did last year.
China stakes claim to S. Texas oil, gas
By Monica Hatcher - Houston Chronicle
HOUSTON - State-owned Chinese energy giant CNOOC is buying a multibillion-dollar stake in 600,000 acres of South Texas oil and gas fields, potentially testing the political waters for further expansion into U.S. energy reserves.
With the announcement Monday that it would pay up to $2.2 billion for a one-third stake in Chesapeake Energy assets, CNOOC lays claim to a share of properties that eventually could produce up to half a million barrels a day of oil equivalent.
It also might pick up some American know-how about tapping the hard-to-get deposits trapped in dense shale rock formations, analysts said.
IMF-G7 Weekend Will Just Hurt the Dollar More
By Richard Lee - The DailyReckoning.com
10/11/10 New York, New York - Central bankers and finance ministers from around the world are converging on Washington, DC this weekend to discuss, among other things, the global wave of currency devaluations. But the most likely thing the meetings will accomplish is to propel the major and emerging market currencies even higher against the US dollar.
This all comes amid what some have called a "currency war," efforts by central banks to manipulate home currencies regardless of their effects on other currencies. Everyone is doing it - either passively or actively.
Securitized mortgage debt fraud to kill financial market
By Jim Sinclair - CommodityOnline.com
I am asking for your attention again because of the depth of the fraud and now the size of the securitized mortgage debt OTC derivative pile of garbage that is in the trillions. This entire mountain of weapons of mass financial and social destruction is now in question.
I have been telling you this for more than 2 years since the manufacturers and distributors of this crap were called by the NY Fed due to the loss of control over the paperwork.
States to Probe Mortgage Mess Attorneys General Hope Lenders Will Re-Write Loans With Troubled Documents
By ROBBIE WHELAN And RUTH SIMON - WSJ.com
A coalition of as many as 40 state attorneys general is expected Wednesday to announce an investigation into the mortgage-servicing industry, an effort some of them hope will pressure financial institutions to rewrite large numbers of troubled loans.
The move comes amid recent allegations that mortgage-servicers, which include units of major banks such as Bank of America Corp., submitted fraudulent documents in thousands of foreclosure proceedings nationwide.
A Spooked U.S. Economy in October
By: Dr Ron Paul - SafeHaven.com
Last week we received worse than expected unemployment numbers, challenging recent claims that the recession has come and gone. Also, as the economy continues to suffer the after effects of the Federal Reserve-created bubbles of the last decade, there is renewed interest in gold. Fears that the Federal Reserve will pump even more money into the system had caused the price of gold to reach new highs.
Stock Market Emulating 1930's Crash Pattern
By: Captain Hook - MarketOracle.co.uk
Damn The Economic Torpedoes - It's Fiat Nirvana Or Bust - Little doubt can exist US central planners intend to go the full nine yards in attempting to overt a repeat of Japan over the past twenty years. We know this because the Fed told us in it's last meeting it's prepared to do anything to avoid such an outcome, which for them means they are willing to turn the screws on the printing presses without limit. Hence the title attempting to capture the condition our condition is in, damn the torpedoes - it's fiat nirvana or bust - where just about every observer on the planet thinks such an outcome is now baked in the cake. This is of course a very dangerous condition sentiment wise, which we will expand on below. However for now it looks as though monetary authorities will pull it off, as many believe the markets are still in a position to accommodate such thinking.
Fed Mandates Inflation
By: Peter Schiff - GoldSeek.com
Much of the content of the latest Fed statement, released on September 21, echoes the central bank's previous post-credit crunch pronouncements: there is still too much slack in the economy, interest rates are still going to be near-zero for an "extended period," and the Fed will continue to use payments from its Treasury purchases to buy yet more Treasuries.
But this recent statement uses a new turn of phrase that should have Americans very upset. The Fed says that "measures of underlying inflation are currently at levels somewhat below those the Committee judges most consistent, over the longer run, with its mandate." Though the wording treads lightly, it should not be taken lightly. It may signal the final push toward dollar collapse.
Inflation to Make All Americans Billionaires By 2020
National Inflation Association - SilverBearCafe.com
One of the Federal Reserve's original stated purposes was to manage the nation's money supply through monetary policy that provides for stable prices without inflation or deflation. Shocking just about the whole world except for NIA members, the Federal Reserve this past week shifted its purpose from being an inflation fighter to now being an inflation advocate. Charles Evans, President of the Federal Reserve Bank of Chicago, is now saying that inflation in the U.S. is too low and the Federal Reserve needs to publicly declare a new goal of having inflation that is much higher than its informal 2% target. William Dudley, President of the New York Federal Reserve, is calling current low levels of U.S. inflation "a problem" because "it means slower nominal income growth".
Worldwide Hyperinflation Race
FSK Guide to Reality
In the USA and Europe, there is massive inflation to bail out the banksters. Aiming for stable exchange rates, other countries are also inflating their money.
Politicians in other countries value their exports to the USA. As dollar inflation occurs, prices of non-US goods rise relative to US-produced goods. To keep exports at the same level, the other country must also inflate.
Consider a factory owner in China. The factory exports to the USA, receiving dollars. The factory owner trades his dollars with China's government for newly-printed yuan. China's government merely holds the dollars, rather than buying tangible goods. The net effect is that the USA exports inflation to China. In effect, China's politicians are subsidizing the banksters in the USA.
Gold keeps up rally as silver hits 30 yr high
SINGAPORE (Commodity Online): Gold prices extended gains in Asian trade Monday as the dollar continued its southern journey while the silver hit a 30-year high.
Gold for immediate delivery was seen trading at $ 1355.61 an ounce at 1.00 p.m Singapore time while spot silver rose to a 30-year high of $23.65 an ounce, before easing to $23.39.
Gold Rises to Record Closing Price in N.Y.; Silver Advances
By Claudia Carpenter and Pham-Duy Nguyen
Oct. 11 (Bloomberg) -- Gold futures rose to a record closing price on bets that the dollar will resume a slump, boosting demand for precious metals as an alternative investment. Silver extended a rally to the highest level since 1980.
The greenback traded close to a a 15-year low against the yen on speculation that the Federal Reserve will expand a stimulus program to bolster the economy. The dollar rebounded against the euro. Hedge funds and other large speculators hold the most-bullish position in gold futures in almost a year. The metal has climbed 24 percent this year.
"The bullish case for gold is still intact, and people will come in and buy on the dips," said Frank Lesh, a trader at FuturePath Trading LLC in Chicago. "You've got the specter of more Fed easing and economic uncertainty to support the gold market."
Can Gold Go Higher? History Says Yes
By David Moenning - SeekingAlpha.com
Throughout 2010, there has been plenty of chatter about gold. The precious metal is up +19% YTD, and currently sits above $1300/oz. If you follow the market media, you'd notice that everyone is currently talking about where the "peak" is. However, calling a top in something that's on a big run can be tough, even for the "big boys." Legendary commodities trader Dennis Gartman has been publicly wrong on CNBC twice recently; the first time saying that gold would experience an exponential run, and then stating that he was wrong and that the top for the year was in. And what has gold done since that last call? Yep, you guessed, it; gold has gone to new highs.
Gold: Insurance Against Total Collapse of the Banking System
By Doug Eberhardt - SeekingAlpha.com
Bank of America (BAC) announced they are halting foreclosure in 50 states because of potential flaws in foreclosure documents. But its not just Bank of America that is halting foreclosures. More and more banks are joining the list to halt any foreclosure action, including JPMorgan Chase (JPM).
Also Friday, PNC Financial Services Group Inc. said it is halting most foreclosures and evictions in 23 states for a month so it can review whether documents it submitted to courts complied with state laws. An official at the Pittsburgh-based bank confirmed the decision on Friday, which was reported earlier by the New York Times. The official requested anonymity because the decision hasn't been publicly announced.
Gold And Silver Are the Winners in A Currency War
By: Peter Cooper - GoldSeek.com
The failure of the IMF meeting at the weekend to do anything meaningful to head off a currency war between the indebted countries that want to devalue away their economic problems and the creditor nations that lose if they do leaves the forex markets facing a currency war.
It will be a battle royal between central banks. In any war the ultimate winner is the one with the greatest resources and at least some strategic advantage and a brilliant general can tip the balance.
Why Do Governments Still Own So Much Gold?
By Garrick Hileman - SeekingAlpha.com
With the gold standard long gone, ever wondered why so many countries (and a couple multinational institutions) still own so much gold? Some foreign leaders have wondered the same thing themselves.
Ex-UK Prime Minister Gordon Brown didn't see much point in guarding British gold. While he was Chancellor of the Exchequer he sold almost 400 tons (or nearly half) of England's (hundreds of years old) gold reserves.
Brown's market timing won't aid any dreams of a lucrative hedge fund consulting career: His sales between 1999 and 2002 at $256 to $296 an ounce were at the 30+ year low. Since Brown's golden folly the value of Au has nearly quintupled in value. Ouch.
Silver: The House Always Wins, Until Now
By Chris Mack - SeekingAlpha.com
Some traders have reported that a large buyer is entering the market
Anyone following the futures market for silver know that the large commercial traders, banks such as JP Morgan Chase (JPM), always win. That is until now.
During the bull market in silver that began in 2001, a pattern of trading similar to the martingale-betting strategy emerged: Eight trading institutions sold short increasingly larger amounts of contracts into rallies until their sales volumes overwhelmed the market into a freefall. The same banking institutions would then purchase those short positions at a profit after the freefall and the rally process would begin again. This process of taking money from precious metals investors has been well documented by analysts such as Ted Butler, David Morgan, and others. The strategy has been so successful that some futures traders began to front run the banks on their own tactics using the COT report and other sentiment indicators.
Fed Needs to Pump Trillions More Into Economy
By: CNBC.com
The Federal Reserve needs to pump at least $6 trillion to $7 trillion more into the U.S. economy to have any meaningful impact on sluggish growth, former Bush economic adviser Marc Sumerlin told CNBC.
Sumerlin, co-founder of The Lindsey Group, a Washington DC-based economic advisory group, also said that the U.S. would fall back into a recession if the Bush tax cuts aren't extended beyond this year.
The Fed has hinted for weeks that it is ready to buy up more debt in the credit markets to help spur the economy, which is still recovering from the financial crisis of 2008. The U.S. central bank has already spent over $1 trillion since early 2009 to keep credit markets liquid in what has become known as quantitative easing, or QE.
Jim Rogers: Federal Reserve Will Implode
by Robert Wenzel - LewRockwell.com
Last night at the Mises Institute in Auburn, Alabama, author, investor and global traveller, Jim Rogers, was awarded the prestigious Schlarbaum Prize for the lifetime defense of liberty.
Rogers told attendees to the event that the United States has had two central banks prior to the Federal Reserve and that they both disappeared. He said he fully expected the same thing to happen to the Federal Reserve. He charged that Ben Bernanke as Fed chairman only knows how to print money, and that this money printing policy of the Fed will cause it to collapse from within.
Fed Certain to Act in November In a Big Way
By: Steve Liesman - Senior Economics Reporter
Following Friday's disappointing jobs report, market participants are now virtually certain that the Federal Reserve will announce that it will resume buying assets at the conclusion of its November meeting and do so in a sizeable way, according to an exclusive CNBC Fed Survey.
Nearly 93 percent of the 70 respondents, including economists, fund managers and traders, believe the Fed will boost the size of its portfolio, up from 69 percent in the survey two weeks ago.
Of those who expect the Fed to move, 86 percent look for an announcement in November, up from 38 percent in the last survey.
The Hail Mary QE2 Can Sink the Dollar
by Peter Schiff - LewRockwell.com
Since the US economy has failed to recover as widely predicted, pressure on the Federal Reserve to conjure a solution has increased. In fact, the Fed now faces the hardest choices in its history. It can either redouble its past efforts to re-inflate America's bubble economy (risking the destruction of the US dollar) or it can stop pumping and let the economy deflate to a self-sustaining level. Unfortunately, both choices guarantee severe economic pain - but only one offers the possibility of ultimate success.
America's China Bashing: A Compendium of Junk Economics
by Michael Hudson - LewRockwell.com
It is traditional for politicians to blame foreigners for problems that their own policies have caused. And in today's zero-sum economies, it seems that if America is losing leadership position, other nations must be the beneficiaries. Inasmuch as China has avoided the financial overhead that has painted other economies into a corner, nationalistic U.S. politicians and journalists are blaming it for America's declining economic power.
China Currency Reserves May Hit $2.5 Trillion, Stoking Tensions
By Bloomberg News
Oct. 11 (Bloomberg) -- China's foreign-exchange reserves, the world's largest, may have climbed to a record $2.5 trillion, adding fuel to complaints that the nation's currency intervention is undermining the global economic recovery.
Currency holdings rose about $48 billion in the third quarter, according to the median estimate in a Bloomberg News survey of eight economists. That would compare with a $7 billion gain in the previous three months, the smallest increase in 11 years. The central bank may release the number this week.
Currency Rift With China Exposes Shifting Clout
By SEWELL CHAN - NYTimes.com
WASHINGTON - At a private dinner on Friday at the Canadian Embassy, finance officials from seven world economic powers focused on the most vexing international economic problem facing the Obama administration.
Over seared scallops and beef tenderloin, Treasury Secretary Timothy F. Geithner urged his counterparts from Europe, Canada and Japan to help persuade China to let its currency, the renminbi, rise in value - a crucial element in redressing the trade imbalances that are threatening recovery around the world.
China to Add Emerging-Market Currencies to Reserves
By Ye Xie and Lilian Karunungan
Oct. 11 (Bloomberg) -- China is moving to add more emerging-market currencies to its foreign-exchange reserves, a strategy central banks around the world are following to diversify their $8.7 trillion in holdings.
"We can diversify more the foreign reserves, to consider not only smaller countries, but some emerging-market economies," central bank Governor Zhou Xiaochuan said at an event during a meeting of the International Monetary Fund in Washington yesterday. With increased assets, "you can shift some to riskier, but higher-return investment instruments," said Zhou.
Swaps Show Hu Jintao Bonds Approaching Treasuries: China Credit
By Shelley Smith
Oct. 11 (Bloomberg) -- At a time when governments around the world are facing growing debt, China's bonds are becoming almost as safe as U.S. Treasuries in the market for insuring against defaults.
Five-year credit-default swaps contracts on the nation's bonds fell 29 percent in the past month, the biggest drop among more than 80 nations, and ended last week at 56 basis points, according to data compiled by CMA and Bloomberg. Default swaps for the U.S. were little changed at 46.
China's bonds have become cheaper to insure than those of the U.K. and France since August as the fastest-growing economy surpassed Japan to become the world's second-largest. Moody's Investors Service said last week it may raise China's debt rating from A1, five levels below the top Aaa grade.
China Trade Surplus Poised to Cap Biggest Quarter Since Crisis
By Bloomberg News
Oct. 12 (Bloomberg) -- China may tomorrow report a $17.8 billion trade surplus for September that would cap the biggest quarterly excess since the financial crisis in 2008, adding fuel to U.S. calls for import protection.
The median estimate of 24 economists surveyed by Bloomberg News compares with an August surplus of $20 billion. That would take the third-quarter total to $66.5 billion, the largest since the fourth quarter of 2008.
Business economists cut national growth forecast A survey by the National Assn. for Business Economics says the gross domestic product will grow at a 2.6% annual pace this year and next, down from an earlier estimate of 3.2% for each year.
By Jeffry Bartash - LATimes.com
Washington - A group of top business economists cut their forecast Monday for U.S. growth through 2011, saying high debts and a decline in the nation's wealth would inhibit spending and investing.
The National Assn. for Business Economics reduced its forecast for annual growth in the gross domestic product to 2.6% for 2010, down from a springtime estimate of 3.2%. Similarly, the group cut projected 2011 growth to 2.6% from 3.2%.
Battered housing market leaves people downsizing their dreams
By Annie Gowen - Washington Post Staff Writer
Three years ago, a developer with grand dreams of a new neighborhood and town center leveled about 750 acres of pristine forest overlooking the Potomac River in Prince William County. Then the market tanked, and the developer of Harbor Station defaulted on a $100 million loan.
Now the land is just a gaping hole with construction debris except for one thing: a Jack Nicklaus-designed golf course hidden inside, perfectly manicured and green. Empty of players. No clubhouse. Waiting.
Ohio, Hit Hard by Foreclosure, Now at Epicenter of Fraud Crisis Scandal Means Reprieve From Evictions -- for Now
By ANNIE LOWREY - The Washington Independent
James Jones has spent the past five years trying to prevent foreclosures in Cleveland. Recently, his work as director of foreclosure prevention at the East Side Organizing Project, a community organizing group dedicated to improving neighborhood life in the city, has focused on targeting predatory lenders and trying to prevent banks from foreclosing on cash-strapped low-income borrowers.
"I've seen the foreclosure issue go from predatory loans, to subprime loans, to predatory loans, to an economic situation where folks have been laid off," Jones explains. "And now we're back to problems with paperwork."
California might join probe of lenders that seized homes Some banks filed faulty paperwork in the 23 states where the courts handle foreclosures. They 'might not be complying with other state laws as well,' says a spokesman for state Atty. Gen. Jerry Brown.
By E. Scott Reckard and Alejandro Lazo, Los Angeles Times
California officials are considering joining a multistate investigation of whether lenders have violated foreclosure laws when seizing houses from delinquent borrowers.
The investigation, which is expected to be publicly announced Wednesday, is spearheaded by Iowa Atty. Gen. Tom Miller. Under his leadership, coalitions of states have won lending-abuse settlements of $484 million from Household International Inc. and $325 million from Ameriquest Mortgage Co.
Foreclosure logjam threatens Fannie, Freddie
By Zachary A. Goldfarb, Dina ElBoghdady and Ariana Eunjung Cha
Washington Post Staff Writers
A breakdown in the nation's foreclosure process threatens to create billions of dollars in losses for federally controlled mortgage finance companies Fannie Mae and Freddie Mac, highlighting how improper actions by banks could impose new costs on taxpayers, said government officials and industry sources.
To protect themselves from those losses, Fannie and Freddie have threatened to penalize thousands of lenders if they fail to rapidly fix the way they seize the homes of borrowers who missed their payments, according to letters sent by the firms to lenders.
After mortgage meltdown,
Barney Frank gets another chance to remake housing finance
By Zachary A. Goldfarb - Washington Post Staff Writer
Rep. Barney Frank, the disheveled, fast-talking Democrat from Massachusetts, had long been known more for his acerbic tongue than for the cause that has captivated him since he was a young aide in the Boston mayor's office.
Frank had championed housing for America's poor for four decades, but he gained the chance to leave his biggest mark in 2007 when he became chairman of the House Financial Services Committee. He dreamed of tapping into the riches of Fannie Mae and Freddie Mac - at the time, both fabulously successful mortgage finance companies - to help pay for the construction of thousands of affordable apartments.
Collapsing empire watch
BY Glenn Greenwald - Salon.com
It's easy to say and easy to document, but quite difficult to really internalize, that the United States is in the process of imperial collapse. Every now and then, however, one encounters certain facts which compellingly and viscerally highlight how real that is. Here's the latest such fact, from a new study in Health Affairs by Columbia Health Policy Professors Peter A. Muennig and Sherry A. Glied (h/t):
In 1950, the United States was fifth among the leading industrialized nations with respect to female life expectancy at birth, surpassed only by Sweden, Norway, Australia, and the Netherlands. The last available measure of female life expectancy had the United States ranked at forty-sixth in the world. As of September 23, 2010, the United States ranked forty-ninth for both male and female life expectancy combined.
The Killing and Reviving of the American Dream
By: Llewellyn H. Rockwell, Jr.
USA Today loves to run lifestyle features that purport to show how we are living, what we are doing, what we like and what we don't like - premised on a collectivist assumption that all our preferences can be tracked and characterized with these aggregate claims.
Most of the time, these features are silly. It's not really true that we are all listening to Lady Gaga and Justin Bieber, or tweeting what we had for breakfast.
Our next stop, the twilight zone
By James Best - RegularFolksUnited.com "Government, government, government. Government does not create jobs. It's very simple how you create jobs. An entrepreneur takes a risk." - Linda McMahon
Economists and entrepreneurs deal with reality - and from what I've been reading lately, quite different realities. I'm too simple to grasp parallel universes, so I've got to pick one to believe. Do I trust an economist that has studied job creation, or the entrepreneur that has met a payroll?
I should tell you, I'm prejudiced. I was trained in economics, but I made a living as an entrepreneur and by advising entrepreneurs. I have to go with the entrepreneurs. When economists are wrong, they do the two-step and muddle up their previous pronouncements. When entrepreneurs are wrong, they hire bankruptcy attorneys.
How you pay for stuff could soon determine how much you pay
By Sandra Block - USAToday.com
Ordinarily, the form of payment consumers use when they buy a pair of pants or set of tires reflects their personal preference and financial situation. If they're trying to stay out of debt - or they're just cheesed at the credit card companies - they'll probably pay with a debit card, or cash. Consumers who are trying to rack up lots of airline miles or other rewards are more likely to pay with a credit card.
But soon, the form of payment you use could also influence the price you pay for your purchase.
Seniors prepare for a Social Security freeze If Democrats are blamed for the decision,
it could have an impact on Election Day
By Matt Sedensky, AP
Seniors are preparing to cut back on everything from food to charitable donations to whiskey as news spreads that their Social Security checks will be frozen for a second straight year next year.
Though the decision wasn't made by politicians, it could have an impact on Election Day if seniors blame Democrats for it. Older people are the most loyal of voters, and their support is especially important during mid-term elections, when turnout is lower.
'Tea party' warms up to Tancredo Third-party bid for Colorado governor gains steam
By Valerie Richardson - The Washington Times
DENVER | There's a "tea party" candidate running for governor in Colorado this fall, but with three weeks to go in the campaign, it's not entirely clear who it is.
Over the summer, the overwhelming choice of the conservative grass-roots movement was Republican nominee Dan Maes, who won an upset victory in the Aug. 8 GOP primary. Since then, however, the tea partiers - who are a growing political force in this state - have grown increasingly sweet on third-party candidate Tom Tancredo, a former Republican congressman and failed presidential candidate best known for his outspoken views on illegal immigration.
Darpa Starts Sleuthing Out Disloyal Troops
By Spencer Ackerman - Wired.com
The military is scrambling to identify disgruntled or radicalized troops who pose a threat to themselves or their buddies. So the futurists at Darpa are asking for algorithms to find and pre-empt anyone planning the next Fort Hood massacre, WikiLeaks document dump or suicide-in-uniform.
This counterintelligence-heavy effort isn't Darpa's typical push to create flying Humvees or brainwave-powered prosthetic limbs. But the Pentagon's far-out R&D team has made other moves recently to hunt down threats from within.
What Are China's Military Intentions in Central Asia?
Written by Joshua Kucera - OilPrice.com
China's performance in the recent Shanghai Cooperation Organization exercises in Kazakhstan suggests that Beijing is preparing its military to be able to intervene unilaterally in Central Asia, says Roger McDermott. He also notes that China seemed to be showing off equipment and capabilities that were domestically produced and which Russia, in particular, lacked:
Intervention during a crisis in Central Asia appears more plausible, though it remains unclear whether the Collective Security Treaty Organization (CSTO) or the SCO might offer a viable multilateral framework in such circumstances, or if a bilateral agreement would be preferred resulting in a unilateral operation...
Gates Urges China to Improve Military Ties With U.S.
By THOM SHANKER - NYTimes.com
HANOI, Vietnam - Defense Secretary Robert M. Gates met here with his Chinese counterpart on Monday to directly make a case for restoring military-to-military relations broken off by Beijing in retaliation for American weapons sales to Taiwan.
At the sidelines of a conference for Asian defense ministers, Mr. Gates spent about half an hour behind closed doors with Gen. Liang Guanglie of China, and emerged to say he had explained how arms sales to Taiwan were a decision by Washington's civilian leadership, not one made by the Pentagon or the armed forces.
Obama loosens sanctions on C-130s to China Timing of waiver questioned by critics
By Bill Gertz - The Washington Times
President Obama issued a waiver loosening Tiananmen arms sanctions for C-130 military transports for China a day after the Nobel Peace Prize was awarded to an imprisoned Chinese dissident who dedicated the prize this past weekend to the victims of the 1989 crackdown.
Chinese state-run news media on Monday hailed the White House waiver announcement as a sign Washington is moving to lift the 11-year-old arms embargo.
However, White House National Security Council spokesman Michael Hammer said the waiver issued on Saturday will not allow C-130s sales. "Under this announcement, we are not selling any aircraft to anyone," he stated in an e-mail.
More Bad News: 10 Things You Should Know About The Latest Economic Numbers
On Friday, headlines across the United States declared that "unemployment remains unchanged at 9.6%". Many analysts rejoiced and heralded this announcement as a sign that we have hit bottom and that things will be turning around soon. But is that the truth? A closer look at the unemployment numbers reveals some disturbing facts. For example, according to the Bureau of Labor Statistics, a broader measure of unemployment that includes workers that have stopped looking for work rose sharply to 17.1%. But that is not the only troubling sign from this past week. Agricultural commodities continue to skyrocket, which means that food price increases are on the way. The foreclosure "robo-signing" crisis continues to escalate, and that threatens to throw the entire mortgage industry into a state of absolute turmoil. Meanwhile, the U.S. national debt continues to grow and wealth continues to leave the United States at a dizzying rate. So is there reason for optimism? No, not really.
Ron Paul: U.S. Heading for Soviet-Style Economic Collapse
How We Could Have Both Inflation and Deflation
by Kimball Corson - SeekingAlpha.com
In a nutshell, financial asset prices and high end products could continue to rise moderately, while the prices of other consumer and durable goods could fall in a depressionary spiral. Why? Several factors are coming to bear that raise that possibility. First, except for some transient Obama band-aids, income and especially income growth have been significantly redistributed toward the wealthy and moderately away from the middle and lower classes. The wealthy spend less of a percentage of their income on consumption and so aggregate demand and employment are compromised relative to what we would have if income were more normally distributed.
Inflation?
Howard Ruff - SilverBearCafe.com
One thing that puzzles many people is the fact that all the conditions for inflation seem to be there. They are printing a lot of dollars, but inflation doesn't seem to be taking off, though gold and silver are acting as though it is. But gold and silver are right, inflation is taking off.
First, let me define inflation. To the economist, inflation is not rising prices any more than wet sidewalks are rainstorms. Inflation is an increase in the supply of money. It should really be called dilution because it dilutes the value of existing dollars.
In fact, a more proper term would be "monetary inflation." Monetary inflation is currently raging as the Federal Reserve is printing more and more money, and gold and silver are responding.
Gonzalo Lira:
Hyperinflation is coming to the US by the end of 2011 PART 1 of 2
Gonzalo Lira:
Hyperinflation is coming to the US by the end of 2011 PART 2 of 2
The Fed's BigTease Continues
by Sy Harding - SeekingAlpha.com The Fed is not saying whether it will or won't.
After its worst August in years the stock market has rallied back strongly in spite of growing indications that the economic recovery has stalled and is now slowing at a disturbing pace. The catalyst has been the market's expectation that the Federal Reserve will initiate a second round of policy 'easing' that will re-stimulate the recovery.
The Fed is not saying whether it will or won't, alternately holding out the carrot and then withdrawing it, keeping investors and traders uncertain but hopeful.
The Secret Big-Money Takeover of America
By Robert Reich
Not only is income and wealth in America more concentrated in fewer hands than it's been in 80 years, but those hands are buying our democracy as never before - and they're doing it behind closed doors.
Hundreds of millions of secret dollars are pouring into congressional and state races in this election cycle. The Koch brothers (whose personal fortunes grew by $5 billion last year) appear to be behind some of it, Karl Rove has rounded up other multi-millionaires to fund right-wing candidates, the U.S. Chamber of Commerce is funneling corporate dollars from around the world into congressional races, and Rupert Murdoch is evidently spending heavily.
No one knows for sure where this flood of money is coming from because it's all secret.
Aftershock: The next economy and America's future
Currency wars are necessary if all else fails The overwhelming fact of the global currency system is that America needs a much weaker dollar to bring its economy back into kilter and avoid slow ruin, yet the rest of the world cannot easily handle the consequences of such a wrenching adjustment. There is not enough demand to go around.
By Ambrose Evans-Pritchard - Telegraph.co.uk
Asian investment in plant has run ahead of Western ability to consume. The debt-strapped households of Middle America, or Britain and Spain, can no longer hold up the dysfunctional edifice. Asians must take over, or it will come down on their own heads.
The countries actively intervening in exchange markets to suppress their currencies - China, Japan, Korea, Thailand, even Switzerland, to name a few - are all too often the same ones that have the biggest trade surpluses with the US.
Webster Tarpley: "There's a currency war!"
Currency Wars: The Phantom Menace
Kieran Osborne - SilverBearCafe.com
The last thing the global economy needs right now is anything that would hamper or derail economic growth. Unfortunately, there appears a growing specter of this occurring. Brazil and Japan's recent decisions to intervene in the currency markets follow a disturbing trend. If policy makers are not careful, present dynamics may precipitate a worldwide economic slowdown, brought about by protectionist pressures and exacerbated by political motivations globally.
Currency Wars Prove Decoupling Is a Myth Better global balance is needed, but who will go first?
by Rex Nutting
WASHINGTON (MarketWatch) - There's a depressing familiarity to the latest World Economic Outlook from the International Monetary Fund: The major economies of the world can still bring each other down too easily.
The rising risk of a full-blown currency war is just the most recent example of how interconnected the global economy remains. The Great Recession put an end to the notion that emerging economies had effectively decoupled from the advanced ones. Read David Callaway on the race to the bottom.
The Fed's Hail Mary
by Peter Schiff Seekingalpha.com
Since the US economy has failed to recover as widely predicted, pressure on the Federal Reserve to conjure a solution has increased. In fact, the Fed now faces the hardest choices in its history. It can either redouble its past efforts to re-inflate America's bubble economy (risking the destruction of the US dollar) or it can stop pumping and let the economy deflate to a self-sustaining level. Unfortunately, both choices guarantee severe economic pain - but only one offers the possibility of ultimate success.
America's Third World Economy - The Great Transformation
Paul Craig Roberts - SilverBearCafe.com
For a number of years I reported on the monthly nonfarm payroll jobs data. The data did not support the praises economists were singing to the "New Economy." The "New Economy" consisted, allegedly, of financial services, innovation, and high-tech services.
This economy was taking the place of the old "dirty fingernail" economy of industry and manufacturing. Education would retrain the workforce, and we would move on to a higher level of prosperity.
Time after time I reported that there was no sign of the "New Economy" jobs, but that the old economy jobs were disappearing. The only net new jobs were in lowly paid domestic services such as waitresses and bartenders, retail clerks, health care and social assistance (mainly ambulatory health care services), and, before the bubble burst, construction.
Why you (probably) need more gold
The Fed seems set on a course that leads to inflation and a devalued currency, yet investors worry about the price of gold. Most don't own enough to be hurt by it -- or enough to protect themselves from a currency disaster.
By Bill Fleckenstein - MSN Money
A New York Times story on its Oct. 1 website about the Federal Reserve's tilt toward more quantitative easing spelled out the current thinking at the central bank. And even though said thinking did not surprise me in the least, it was still a bit of a shock to see it in black and white:
"What the officials are saying, in increasing unison, is that inflation is undesirably low, well below the implicit target of about 2%, and that unemployment, at 9.6%, is far too high."
Gold posts gains for 4th week on Fed easing hopes Bullion supported by view Fed easing imminent
The Financial Daily
NEW YORK: Gold rebounded 1 per cent on Friday a day after a sharp retreat, as a weak US employment report spurred buying by investors who expect the Federal Reserve will start buying government debt again to stimulate the economy. It was the fourth consecutive weekly rise for both gold and silver. For the week, silver was up 5 per cent, outperforming gold's 2 per cent rise.
A US Labor Department report showed the US economy shed jobs in September for the fourth month in a row as government payrolls fell and private hiring slowed.
The bulls head the global stampede for gold bullion - but will it last? It's seen as a safe haven in times of economic turmoil, so no wonder gold prices are rising. But not everyone is a committed buyer, even today
Richard Wachman - The Observer - Guardian.co.uk
When a huge gold-plated statue of a sausage was unveiled in the small Russian town of Novokuznetsk, it seemed final proof the world had gone crazy about this most precious of metals.
The salami sculpture was in fact a tribute to the town's favourite food. But the taste for gold is universal, with the price up 54% in two years, according to the World Gold Council (WGC).
Last week, spot gold touched $1,343.90 (£842.81) an ounce - an all-time high - with bulls forecasting it could top $1,500 by the end of the year.
When Will Gold Reach $10,000 an Ounce?
by David Friedman
Gold bugs like gold because, unlike fiat money, gold has an inherent value to it. Its relative scarcity makes it more valuable than other things. It's interesting, then, to list gold bugs' arguments in favor of gold. Their main claim is that when governments devalue their currency, by letting inflation run rampant and taking on more debt than seems prudent, gold becomes an attractive investment vehicle. Never mind the problems with storing, moving, and securing gold, the gold bugs say: gold has inherent value that fiat currency does not.
Gold and Silver Almost Go Parabolic as Currency Wars Heat Up
Dr. Duru - SeekingAlpha.com
Talk of currency wars have heated up as several events have converged to make the public increasingly aware of the on-going competitive devaluations around the globe. The increasing clamor came ahead of an IMF meeting Thursday and a G7 meeting this weekend where the topic of global trade and currency rates are hot topics. It is probably no coincidence that gold and silver started to go parabolic ahead of these meetings. The euro's test of the 1.40 level against the U.S. dollar seemed to be a sufficient catalyst to cool off the rocket fuel quickly and abruptly. Even oil reversed sharply on Thursday. These moves have created "bearish engulfing" patterns which typically signal the end of a rally.
Silver price manipulation probe may hit prices
CommodityOnline.com
WASHINGTON (Commodity Online): Will the truth come out ever as far as the bullion price manipulation occurred in the US. It seems the investors will get to know the truth if a demand from them is accepted by the regulators.
Recently, the US regulators were urged to reveal the results of a two-year-long investigation into silver and gold price manipulation allegations. The findings are keenly awaited by investors and organisations who have been making allegations about silver and gold price manipulation for decades.
Trashed Real Estate, Soaring Gold
by Bruce Vanderveen - SeekingAlpha.com
The prop wash from Ben Bernanke's helicopters has yet to spread dollars on the struggling U.S. real estate market. Gold, though, up over 30% in the last year, is a major beneficiary,
Three years ago a typical Florida house (Tampa area) sold for $240,000 and gold was around $450/oz. Now the house value has been cut in half to $120,000 while Gold has tripled and is closing in on $1,350/oz. It took 535 ounces of gold to buy the house in 2006, today it only takes 90 ounces. Why such a large about face?
Dollar selling likely to continue after IMF meeting
By Steven C. Johnson
(Reuters) - Investors will keep on selling the U.S. dollar and chasing higher returns in emerging markets after finance leaders this weekend produced no quick fix for uneven global growth and tensions in currency markets.
Markets will also be on alert for more intervention by the Bank of Japan, which sold yen on the open market last month for the first time since 2004 in order to weaken the currency against the dollar and support Japan's export-driven economy.
Triffin's Dilemma, Reserve Currencies, and Gold
BY WALKER TODD - AIER.org
Nearly 50 years ago, Yale University economist Robert Triffin identified the inevitable future deterioration of the dollar in his book, Gold and the Dollar Crisis: The Future of Convertibility (1960). Essentially, Triffin argued, under the Bretton Woods system in which the U.S. dollar was the world's principal reserve currency (instead of gold, for example), the United States had to incur large trade deficits in order to provide the rest of the world with the liquidity required for functioning of the global trading system.
Unfortunately, Triffin wrote, U.S. trade deficits eventually would undermine the foreign exchange value of the dollar because foreign accounts would hold an increasing quantity of dollars. Restating Triffin's argument in contemporary terms, as the proportion of dollar claims held abroad versus U.S. gross domestic product (GDP) increases, the foreign exchange value of the dollar must decline if dollar interest rates do not increase at about the same rate as the foreign dollar claims.
Rick Santelli On The Fed's Upcoming "Nixonian" Price Controls
by Tyler Durden - ZeroHedge.com
Rick Santelli was on King World News today, discussing the distinction between deflation and deleveraging, or what some have dubbed the phenomenon of surging prices in things that one can buy without leverage (Friday's limit up open in various commodities being one example), and plunging prices in everything that requires debt (i.e., one's house). And while the Fed can game the CPI as much as it wants, once middle America see the cost of basic foodstuffs double (and it will once producers hit negative profit margins and are forced to pass input cost inflation to end consumers) they will realize just how serious this problem will be. Of course, the only way to offset this localized inflation is by returning to the time when America could use its houses as piggybanks in the form of taking out equity lines of credit. The problem with that, of course, is that the Fed will be forced to increase home prices at all costs, even as speculators take basic commodity prices up in anticipation of the coming hyperinflation.
IMF told to toughen scrutiny of rich powers
By Lesley Wroughton and Emily Kaiser
(Reuters) - Emerging powers won a battle on Saturday for heightened IMF scrutiny of rich countries' economic policies as world financial leaders sought to defuse mounting tensions over currencies.
The International Monetary Fund's 187 member countries gave voice to long-running frustrations of emerging economies, which say the Fund has traditionally not been tough enough on its biggest shareholders, led by the United States.
Geithner's stature and influence at the White House increase After recovering from a rocky start, the Treasury secretary is credited with a string of policy successes. But he continues to be a lightning rod for criticism.
By Jim Puzzanghera, Los Angeles Times
n the early weeks of the Obama administration, Treasury Secretary Timothy F. Geithner seemed like the ultimate short-timer.
There was the rocky confirmation stemming from his failure to pay some personal income taxes. Then after taking office, Geithner's first major speech on the financial crisis was an unmitigated disaster. The markets shuddered at the dearth of details about his plans to stabilize the financial system, and the Dow Jones industrial average plunged 382 points.
Is Geithner in a Position to Make Demands on China?
by Clive Corcoran - SeekingAlpha.com
The following "initiative" from Mr. Geithner follows on from a theme articulated earlier in the week, in which the older and supposedly richer (in fact, the most indebted) economies are prepared to grant more power to the newer and less affluent (in fact, surplus economies with huge currency reserves and savings) economies in the G20, with respect to IMF voting rights.
Geithner aims to dispel five 'myths' about TARP
By Darren Goode - The Hill
Treasury Secretary Timothy Geithner is aiming to put to rest what he calls five "myths" about the controversial Troubled Asset Relief Program, which expired last week and was born at the peak of the financial crisis in 2008.
Geithner - in an op-ed published by the Washington Post Sunday - argues that TARP "was doomed to be unpopular from inception, because Americans were rightfully angry that the same firms that helped create the economic crisis got taxpayer support to keep their doors open." But, he added, that the program "was essential to averting a second Great Depression, stabilizing a collapsing financial system, protecting the savings of Americans and restoring the flow of credit that is the oxygen of the economy. And it helped achieve all that at a lower cost than anyone expected."
September Jobs Data Raises Odds of Fed Asset Buying
By Michael S. Derby - WSJ.com
September's grim jobs environment is increasing already strong chances the Federal Reserve will act again to stimulate economic growth.
The government reported Friday the private sector managed to add an anemic 64,000 jobs last month, but continued cuts in government staffing, which fell by 159,000, caused an overall job loss of 95,000 for the month. The unemployment rate was unchanged at 9.6%. Collectively, the report drove home the view growth is too low to make a meaningful dent in the unemployment rate.
Federal Reserve Officials: Americans Are Saving Too Much Money So We Need To Purposely Generate More Inflation To Get Them Spending Again
TheEconomicCollapseBlog.com
Some top Federal Reserve officials have come up with a really bizarre proposal for stimulating the U.S. economy. As unbelievable as it sounds, what they actually propose to do is to purposely raise the rate of inflation so that Americans will stop saving so much money and will start spending wildly again. The idea behind it is that if inflation rises a couple of percentage points, but consumers are only earning half a percent (or less) on their savings accounts, then there will be an incentive for consumers to spend that money as the value of it deteriorates sitting in the bank. Yes, that is how bizarre things have gotten. It is not as if U.S. consumers are even saving that much money. Several decades ago, Americans typically saved between 8 and 12 percent of their incomes, but over this past decade the personal saving rate got down near zero a number of times as Americans were living far beyond their means. Once the recession hit, Americans very wisely started saving more money, and so now the personal saving rate has been hovering around the 5 to 7 percent range. This is well below historical levels, but the folks at the Fed apparently are eager for Americans to pull that money out and start spending it again.
Bernanke's Declaration of Independence
By: Gary North - LewRockwell.com via GoldSeek.com
Ben Bernanke gave a grim speech on October 4. It did not get media attention. That was because it was so grim.
It was on the looming fiscal crisis of the Federal government. There will be no easy way to avoid it, he said. Congress has to decide what spending to cut. This means that Congress must decide which special-interest groups to alienate. Then it must decide which taxes to raise. Whose ox will get gored?
Congress has been deferring this two-part decision since the Nixon Administration.
Counterfeiters and Thieves?
Dan Denning - SilverBearCafe.com
What's the difference between a thief and a counterfeiter? A thief takes what is not his without another's consent. A counterfeiter passes off as genuine that which he knows to be a fraud. Or, in simpler terms, one is a politician and the other is a central banker.
We'll get back to that in a moment. But judging by the complete and utter lack of interest in our comments earlier this week on the Queensland Rail float (other than a reminder that in Australia they're called 'railways' and not 'railroads') now must be a very good time to buy things that nobody else wants. The prospectus isn't out yet, but we'll have a look when it is and let you know what we think.
Tough Times Call for New Plans
By DANA MATTIOLI - WSJ.com
As chief executives increasingly see a recovery that is a long slog rather than a steady upturn, they are adjusting their business plans to accommodate a choppier outlook.
In response to the slow rebound, many CEOs are delaying expansion decisions they otherwise would have made by now. Others are accelerating plans to target new markets outside their weakened cores.
Outsourcer EXL Service Holdings Inc. recently pushed back its budgeting process, delaying decisions on new spending. Royal Caribbean Cruises Ltd. continues to put off buying new ships. Meanwhile, Hawaiian Airlines parent Hawaiian Holdings Inc. has sped up its Asian expansion as its domestic outlook remains muted, while Weight Watchers International Inc. is targeting corporate clients more as individual consumers remain frugal.
Beware: Credit Markets Are Getting Risky Again
By MATTHEW SCOTT - DailyFinance.com
Risky lending practices may already be creeping their way back onto Wall Street. Investors' pursuit of higher yield has led to a doubling in issuance of both investment- and speculative-grade bonds and loans in September, to $138 billion. Research from Standard & Poor's suggests that while that jump is a positive sign that credit markets have stabilized, it also signals that credit standards may be softening more quickly than is prudent.
The primary market for bonds and loans was averaging about $75 billion per month through August before its September spurt, according to S&P. The steady inflows of cash into bond funds and exchange-traded funds have also helped fuel the market. According to Dealogic, junk bonds have enjoyed a particularly vibrant resurgence: a record-breaking $275 billion in new issuance worldwide in the first three quarters of 2010, up from $163 billion during the same period last year.
This is not an exaggeration. If anything, it might be an understatement.I told you about this last week as a class action with a RICO statute was filed against servicers acting for international investment banks foreclosing on loans that represented the collateral for securitized mortgage debt, a fraudulent OTC derivative.The banksters tried to sneak through a bill that would make their criminal actions legal. The screams were heard in the White House and before the bill passed all its requirements the President vetoed it. That occurred even before the bill had completed its required procedures.
Ezra Klein: What's happening here? Why are we suddenly faced with a crisis that wasn't apparent two weeks ago? Janet Tavakoli: This is the biggest fraud in the history of the capital markets. And it's not something that happened last week. It happened when these loans were originated, in some cases years ago. Loans have representations and warranties that have to be met. In the past, you had a certain period of time, 60 to 90 days, where you sort through these loans and, if they're bad, you kick them back. If the documentation wasn't correct, you'd kick it back. If you found the incomes of the buyers had been overstated, or the houses had been appraised at twice their worth, you'd kick it back. But that didn't happen here. And it turned out there were loan files that were missing required documentation. Part of putting the deal together is that the securitization professional, and in this case that's banks like Goldman Sachs and JP Morgan, has to watch for this stuff. It's called perfecting the security interest, and it's not optional.
The Politics of Foreclosure Washington's latest obstacle to a housing market recovery.
Talk about a financial scandal. A consumer borrows money to buy a house, doesn't make the mortgage payments, and then loses the house in foreclosure - only to learn that the wrong guy at the bank signed the foreclosure paperwork. Can you imagine? The affidavit was supposed to be signed by the nameless, faceless employee in the back office who reviewed the file, not the other nameless, faceless employee who sits in the front.
The result is the same, but politicians understand the pain that results when the anonymous paper pusher who kicks you out of your home is not the anonymous paper pusher who is supposed to kick you out of your home. Welcome to Washington's financial crisis of the week.
White House: No Need For National Foreclosure Moratorium
ALAN FRAM - HuffingtonPost.com
WASHINGTON - A top White House adviser questioned the need Sunday for a blanket stoppage of all home foreclosures, even as pressure grows on the Obama administration to do something about mounting evidence that banks have used inaccurate documents to evict homeowners.
"It is a serious problem," said David Axelrod, who contended that the flawed paperwork is hurting the nation's housing market as well as lending institutions. But he added, "I'm not sure about a national moratorium because there are in fact valid foreclosures that probably should go forward" because their documents are accurate.
Bank of America halts foreclosure sales in all 50 states
WASHINGTON (AP) - A mushrooming crisis over potential flaws in foreclosure documents is threatening to throw the real estate industry into chaos after Bank of America became the first bank to stop taking back tens of thousands of foreclosed homes in the U.S.
Friday's move, along with a reported decision on foreclosures by PNC Financial Services, adds to growing concerns that mortgage lenders have been evicting homeowners using flawed court papers, without verifying the information in them.
Bank of America has $2.3 trillion in assets but $956 billion of that is made up in loans. Think those loans are valued at current market levels? The FDIC would have a challenge even breaking up one too big to fail bank.
MyBudget360.com
The FDIC has a herculean challenge in confronting the too big to fail banks. There is little doubt that having institutions that are too big is part of the reason for the current systemic crisis. Yet through the last few years the solution has been to make these banks even bigger allowing their web to spread even further and deeper into the economy. The FDIC has an insolvent Deposit Insurance Fund (DIF) backing up $13 trillion in banking assets. And what the banks call assets is simply stunning. Bank of America for example has $2.3 trillion in assets (or a larger amount than the annual GDP of California). Yet 41 percent of the assets are backed by loans, predominately real estate loans.
Freezing foreclosures? What does that mean?
By Tami Luhby
NEW YORK (CNNMoney.com) -- Halted foreclosures? Robo-signers? Shoddy paperwork?
The foreclosure crisis has entered a new phase, with at least three major banks halting foreclosure proceedings and sales in nearly two dozen states. One just expanded the ban on foreclosure sales across the nation.
The developments, however, have left homeowners with many questions. CNNMoney.com tries to cut through the confusion.
Why are major banks halting foreclosures?
Foreclosure freeze shakes battered home market
By Chris Isidore, senior writer
NEW YORK (CNNMoney.com) -- Get ready for a bumpy ride in the housing market.
The growing number of freezes on home foreclosures is likely to shake up the struggling U.S. housing market. Experts say home prices could rise in the short term, but the eventual glut of foreclosure sales could hurt the market in the long run.
The move by some major lenders such as Bank of America, JPMorgan Chase and Ally Financial to put some of their foreclosures on hold could help temporarily lift prices, by removing the inventory of bargain-basement foreclosed properties from the market.
There is Only One Way Out of the Foreclosure Crisis
Washington's blog
We're the fish.
The giant "too big to fail" banks are the bird. They've got their talons in the American consumer and the economy.
The only way out for us - the fish - is if someone "shoots" the bird ... or at least captures it and removes its talons from our hide.
In other words: Unless the mega-banks are broken up and reined in, we're in quite a pickle.
As I've previously noted, virtually all leading independent economists have said that the too big to fails must be broken up, or the economy won't be able to recover, and that smaller banks actually lend more into the economy than the mega-bank.
Is ForeclosureGate About To Become The Banking Industry's Stalingrad?
by Tyler Durden - ZeroHedge.com
Will the High Frequency Signing scandal be the proverbial straw on the camel's back. Perhaps. In the meantime, here is a soon to be viral, and all too real, parody of foreclosure gate. At this point the guilty parties are irrelevant. All that matters is that America's terminal collapse into a banana republic status is now obvious for all to see. And as for Cramer saying foreclosure gate will only force home prices to go higher, pray tell dear Jim, just which buyers will put their own money into a home when they have no idea at what time the real title holder shows up with a restraining and eviction order, and demands immediate access. Of course, there is a loophole: the Fed will simply henceforth pay for all home purchases. And should the government drop mortgage rates to zero, and subsidize tax and insurance payments into infinity, that may well happen. Of course, it will also bankrupt the country, but since when was America's insolvency news to anyone...
Foreclosuregate
by Ellen Brown - SeekingAlpha.com
By most reports, it would appear that the voluntary suspension of foreclosures is underway to review simple, careless procedural errors. Errors which the conscientious banks are hastening to correct. Even Gretchen Morgenson in the New York Times characterizes the problem as "flawed paperwork."
But those errors go far deeper than mere sloppiness. They are concealing a massive fraud.
They cannot be corrected with legitimate paperwork, and that was the reason the servicers had to hire "foreclosure mills" to fabricate the documents.
What Must Be Done - Today
by Karl Denninger in Foreclosuregate
Foreclosuregate is rapidly spiraling out of control, and is going to get worse.
As I have repeatedly said since 2007, this is not about bad paperwork. It is about fatally-defective securities sold to investors for half a decade and the fraud up and down the line that enabled those sales.
In no particular order the biggest (but by no means the only) problems are:
Borrowers overstated income, assets or both.
Lenders stuffed paper they either knew was bad or had the ability and legal duty to verify the provenance of but intentionally did not into securities sold to investors.
The land title system in this nation was intentionally subverted and corrupted by both intentional act and intentional laziness, all driven by the motive of profit.
Class Action Lawsuit Against Countrywide: California
by Karl Denninger in Foreclosuregate
This is an extremely-important case folks. The pleadings here, like the case in Kentucky, lay the table in terms of the games that were played during the "Rah-Rah" years.
Let's start with the "meat" of the alleged violations:
The Jobs Report: Truly Bad News
by Michael Shulman - SeekingAlpha.com
The market reacted with a collective yawn to news that the country lost another 95,000 jobs last month, led by the loss of 159,000 government jobs partially offset by a gain of 64,000 private sector jobs led by health care. The yawn was more of a tug of war between those going long due to anticipation of quantitative easing and those bearish due to their belief we are already in another recession.
Economy loses jobs at faster pace in September
Nonfarm payrolls down 95,000 as governments reduce rolls
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) - The U.S. economy lost 95,000 nonfarm jobs in September as local and state governments shed positions at a faster rate than the private sector was adding, the Labor Department reported Friday.
The drop of 95,000 was much wider than the 8,000 decline expected by economists surveyed by MarketWatch, and the 57,000 jobs lost in August.
The nation's unemployment rate remained steady at 9.6% as fewer new workers joined the labor market than in the previous month. Economists had expected a slight increase in the jobless rate.
Sanofi-Aventis to Cut 1,700 Jobs in the U.S.
By DAVID SCHEPP - DailyFinance.com
Sanofi-Aventis (SNY) said Friday it plans to lay off 1,700 workers at its U.S. pharmaceutical operations, which amounts to about 25% of its U.S. workforce. The cutbacks are part of an ongoing restructuring to streamline its business amid a "challenging health care marketplace," the company said in a statement.
The French drugmaker said decisions about the layoffs will be finalized in mid-December. Sanofi employs some 6,900 workers at U.S. pharmaceutical division, based in New Jersey. The company's total U.S. workforce numbers 13,000, it said.
Unfilled Openings Frustrate the Jobless
By MARK WHITEHOUSE - WSJ.com
Job openings aren't what they used to be.
Among the explanations for the stubbornly high U.S. unemployment rate, factors such as housing troubles and extended unemployment benefits have played a leading role. Increasingly, though, economists and job seekers are identifying another problem: Employers are being pickier, or not trying as hard as they usually do to fill the openings they have.
The reasons for the foot-dragging are closely related to the reasons employers aren't creating many openings in the first place. Companies lack confidence about the outlook for consumer demand, they're not sure what the government will do with taxes and regulation, and they want to keep squeezing as much output from their current workers as they can. They also feel they have plenty of time to pick the best candidates.
Time's Running Out for Job Growth
by Felix Salmon - SeekingAlpha.com
There's absolutely nothing to get excited about in the September payrolls report. America has substantially fewer jobs than it did a month ago, in what is meant to be a growing economy. Even the uptick in private-sector employment (+64,000) is pretty pathetic: it's not enough even to keep up with population growth, let alone to make a dent in the unemployment rate, which stays at 9.6%.
Meanwhile, as the school year begins, we have this:
Employment in local government decreased by 76,000 in September with job losses in both education and noneducation.
As states and municipalities around the nation start running out of money, they're going to fire people; this is only the beginning. And if October is any indication, the job losses in the local government sector are going to be at least as big as the job gains in the private sector. No wonder the number of discouraged workers is up a whopping 71 percent even from the grim days of September 2009:
Long-term unemployed aim to become a political force People who have exhausted their jobless benefits are pressing policymakers for more aid and joining together to call attention to their cause.
By Alana Semuels, Los Angeles Times
After his wife of 23 years pulls out of the driveway every morning to head to college, Scott Mathewson sits down at the computer in his apartment and talks to his unemployment group.
Mathewson, a San Jose electrician who has been out of work for more than two years, spends most days in an online chat room he created to lobby for another round of unemployment benefits. In this election year, he and other jobless workers are trying to turn the nation's 14.9 million unemployed into a political force.
Why Is Unemployment Rising?
Washington's Blog
Today's unemployment numbers are bad.
Why is unemployment rising? Because the government is doing everything wrong.
One definition of insanity is doing the same thing again and again and expecting different results. Unless the government substantially changes its approach, unemployment will keep rising.
Here are two essays I wrote - the first last month, and the second last year - explaining why unemployment is rising and what the government needs to do differently to get the unemployment crisis under control.
Government Policy Caused America's Unemployment Crisis
The unemployment rate has risen again for the the first time in 4 months. I predicted a growing, long-term unemployment problem last year.
September Jobs Report: 95,000 More Jobs Lost
FreedomWorks.org
As we've come to expect, the Labor Department released yet another disappointing jobs report today. In September, employers cut an estimated 95,000 workers. Although the number of job losses is higher than forecasted, the unemployment rate remained unchanged at a high 9.6 percent. The official unemployment rate does not count the 1.2 million discouraged workers who have simply given up looking for job. The report states that private sector employers added a less-than-expected 64,000 jobs in September.
About 14.8 million people who would like to job cannot find a job. The July and August payrolls were also revised to show larger job losses than previously reported. The change in payroll employment for July was revised from -54,0000 to -66,000, and the change in August was adjusted from -54,000 to -57,000.
Millions can find only part-time or lower-paying jobs Underemployed workers can't spend as much. Those individual hardships add up to a drag on the economic recovery.
By Don Lee, Los Angeles Times
Reporting from Washington - Beyond the 15 million Americans who have no jobs at all, millions more are caught in part-time or limited jobs that don't pay them enough to maintain their standard of living - much less contribute to the strong consumer spending needed to power the nation out of the economic doldrums.
Economists have a technical term for these people: underemployed.
But there's nothing technical about it for David Linehan of Quincy, Mass., who lost his job as an analyst for an energy-trading firm during the recession, along with his $30,000 salary and benefits.
Los Angeles Government Creates Only 55 Jobs
With $111 Million "Stimulus"
FreedomWorks.org
he late Noble Prize winning economist Milton Friedman once stated:
"When a man spends his own money to buy something for himself, he is very careful about how much he spends and how he spends itÉAnd when a man spends someone else's money on someone else, he doesn't care how much he spends or what he spends it on. And that's government for you."
Milton Friedman's words ring true for the $814 billion government "stimulus" passed in February 2009. The city of Los Angeles is a prime example of government recklessly spending these "stimulus" funds. According to City Controller of Los Angeles Wendy Greuel:
Gerald Celente with Brian Sussman
of KSFO 560 Radio in San Francisco
Federal contracts to be set aside for women-owned businesses
DENVER BUSINESS JOURNAL - BY Kent Hoover
After 10 years of delay, the Small Business Administration will implement a federal contracting program for women-owned businesses early next year.
Congress, in the waning days of President Bill Clinton's administration, directed the SBA to establish a program that would set aside federal contracts for women-owned businesses in industries where they have been under-represented. But the program was never implemented during President George W. Bush's administration.
How Unemployment Will Swing the Elections
by Rick Newman - SeekingAlpha.com
When President Obama took office in January 2009, the economy was spiraling into a black hole and something needed to be done. Obama's economic team predicted that if Congress passed a huge stimulus plan, the unemployment rate, then 7.7 percent, would drift up to about 8 percent, then start to decline. By the time of the midterm elections in November 2010, it would be at a manageable 7 percent or so.
Obama got his stimulus plan, of course, but on Election Day in November, the unemployment rate will be 9.6 percent - nearly 3 points higher than what Obama said it would be. By most accounts, it will keep going up for a while and probably peak above 10 percent in 2011. Obama will be extremely lucky if it's back to 7 percent by the time he runs for reelection in 2012.
Axelrod Hits Out at Foreign Money in Elections Dems Ratchet Up Attack on Chamber of Commerce; GOP Strategist Accuses Obama Admin. of Abuse of Power
By Jimmy So - CBS News
(CBS) David Axelrod, the White House's Senior Adviser, is ratcheting up the Democrats' attack on the U.S. Chamber of Commerce, calling special interest spending "a threat to our democracy."
Axelrod is accusing the Chamber of Commerce of collecting millions of dollars from secret donors - including some foreign sources - to influence the midterm elections in favor of the Republicans, and refusing to disclose their sources.
Axelrod: Chamber must prove foreign money allegations false
By Walter Alarkon - The Hill
White House senior adviser David Axelrod said the U.S. Chamber of Commerce has the burden of proving false the charge by Democrats that the business group is funneling foreign money to Republican campaigns.
Axelrod was pressed by CBS' Bob Schieffer on Sunday for evidence that the foreign campaign contributions benefiting the GOP is more than "peanuts."
"Do you have any evidence that it's not, Bob?" Axelrod said on "Face the Nation." "The fact is that the Chamber has asserted that, but they won't release any information about where their campaign money is coming from. And that's at the core of the problem."
White House staff exodus exposes Obama to charges of disarray More senior staff including defence secretary Robert Gates, and senior advisor David Axelrod, leave their jobs
by Ewen MacAskill in Washington - guardian.co.uk
More senior White House staff are to leave in the next few months, adding to the high exit rate from President Barack Obama's administration.
Political analysts attribute the attrition rate to exhaustion, but Republican opponents blame disarray inside the White House, with an insular team responsible for too many policy failures.
The imminent departures include those of defence secretary Robert Gates, who has said he hopes to retire early next year, and Obama's senior White House adviser, David Axelrod, who is planning a return to his home town of Chicago early next year to concentrate on planning for Obama's 2012 re-election bid.
Barack Obama names Tom Donilon national security adviser Tom Donilon - a sceptic on Afghanistan troop increase - gets top job following resignation of General James Jones
Ewen MacAskill in Washington - guardian.co.uk
US commanders will come under greater pressure to begin withdrawing significant numbers of troops from Afghanistan next July after the appointment today of a new White House national security adviser, Tom Donilon.
He takes over from General James Jones, whose resignation after less than two years was announced today by Obama. Donilon is expected to be much more forceful than Jones as Obama's main adviser on foreign affairs and defence.
Donilon, with no military background, is much more political than Jones and sided with the vice-president, Joe Biden, in pushing for as early an exit from Afghanistan as possible and was reluctant to accede to the generals' insistence on sending an extra 30,000 troops this year.
Why Tea Parties are perfect for a disgruntled, and white, middle class Twenty months after a TV rant spawned a movement, the impact is visible even in President Obama's back yard
Ed Pilkington in Chicago - guardian.co.uk
t's a very ordinary day on the floor of the Chicago board of trade, though you wouldn't know it as the traders are screaming and waving their hands in the air as though the world were ending. How is it possible to get so excited over the price of pork bellies or the prospects of soya beans?
In one corner there is a large group of traders packed in tight and jostling against each other like a crowd of expectant sports fans. They are squashed into the eurodollar pit (this being the impenetrable world of options trading, their activities have nothing to do with euros or dollars).
Rick Santelli: I'm proud to be a firebrand Tea Party godfather says he takes pride in throwing match into political tinderbox with 'the rant'
Ed Pilkington in Chicago - guardian.co.uk
Rick Santelli, the television reporter who will go down in history as the godfather of the Tea Party movement, says he has never been as proud as the moment he set light to a tinderbox that is changing the face of American politics.
Santelli, a business journalist who reports from the floor of the Chicago board of trade for CNBC, is widely credited as providing the spark that ignited the explosion of the movement. He did so in a now famous two-minute diatribe, known in folklore as "the rant", in which he berated the fledgling Obama administration for bailing out what he called "losers" by buying up bad mortgages in the housing crisis.
Remember "The Rant"? - February 19, 2009
Everyone came to see the man in black ...
TodayOnline.com
The world finally gets a long hard look at Kim's heir apparent
PYONGYANG - Clapping, waving and even cracking a smile, Mr Kim Jong Il's heir apparent joined his father yesterday at a massive military parade in his most public appearance since being unveiled as North Korea's next leader.
Mr Kim Jong Eun sat next to his father at the Kim Il Sung Plaza amid celebrations marking the 65th anniversary of the reclusive state's ruling Workers' Party.
Days earlier, the world got a first glimpse of Mr Kim Jong Eun from photos published in the Rodong Sinmun newspaper.
However, yesterday's appearance was carried live by state television, giving the people their first good look at the future leader, who had been made a four-star general less than two weeks ago.
Jonathan Powell: general's outburst endangered British forces in Iraq Tony Blair's former chief of staff criticises comments by General Sir Richard Dannatt about deployment of troops
Nicholas Watt, chief political correspondent - guardian.co.uk
General Sir Richard Dannatt, the former chief of the general staff, is today accused of having endangered the lives of British forces in Iraq in 2006 when he launched a strong attack on the deployment of troops.
Jonathan Powell, chief of staff to Tony Blair, says Dannatt strengthened the hand of militants when he demanded an early withdrawal and accused Britain of having "kicked the door in".
The attack on Dannatt is made by Powell in his memoirs, serialised in the Guardian, in which the former No 10 chief of staff is highly critical of other military figures. Powell writes that:
North Korea puts on show of military might for heir apparent -
and the world Kim Jong-il smiles and claps alongside son as troops and tanks parade in front of live TV audience and international media
Tania Branigan in Pyongyang - guardian.co.uk
The ground shook as thousands of boots slammed on to the road in unison. Martial tunes blared; bayonets glinted; the tanks' diesel fumes choked the air.
Today saw the largest military parade that North Korea has ever witnessed: a blend of sheer force and razzmatazz. But the real show was not down on Kim Il-sung Plaza but up on the viewing rostrum, where the country's leader, Kim Jong-il, and his heir apparent, Kim Jong-un, stood watching.
For most of the spectators, who swivelled as one to cheer and applaud the two Kims' arrival, this was the first sighting of the young general - a man who, until two weeks ago, had never been acknowledged by state media. Unusually, the event was broadcast live, giving the country's 24 million inhabitants a chance to see their leader-in-waiting at last.
Obama's Afghan war strategy: End it Bob Woodward's new book sheds light on the president's intentions. He clearly wants out.
By Doyle McManus - LATimes.com
What are President Obama's intentions in Afghanistan?
He told us 10 months ago, at the conclusion of an agonizing, weeks-long strategy debate, that he would give his generals the 33,000 additional troops they wanted and 18 months to show what they could do with them. Then we would begin drawing down. But did he mean it?
Bob Woodward's new book, "Obama's Wars," for all its reconstructed conversations and unspecified sourcing, is at its most useful in helping answer that question. It helps clarify where things stand inside the Obama administration as it must decide whether to stick to the timetable it laid out.
The Coming Middle-Class Anarchy
By Gonzalo Lira
True story: A retired couple I know, Brian and Ilsa, own a home in the Southwest. It's a pretty house, right on the manicured golf course of their gated community (they're crazy about golf). The only problem is, they bought the house near the top of the market in 2005, and now find themselves underwater. They've never missed a mortgage payment-Brian and Ilsa are the kind upright, not to say uptight 60-ish white semi-upper-middle-class couple who follow every rule, fill out every form, comply with every norm. In short, they are the backbone of America. Even after the Global Financial Crisis had seriously hurt their retirement nest egg - and therefore their monthly income - and even fully aware that they would probably not live to see their house regain the value it has lost since they bought it, they kept up the mortgage payments. The idea of them strategically defaulting is as absurd as them sprouting wings.
China is ripping America: Donald Trump
IST, PTI - EconomicTimes.IndiaTimes.com
NEW YORK: Billionaire American real estate mogul Donald Trump, who is "seriously considering" about the possibility of making a Presidential run in 2012, has slammed China's " unfair trade policy" and made digs at the way US was conducing business with Beijing.
"China is just ripping this country (the US) like nobody has ever ripped us before and we don't have our talented people... we don't use our great business people to negotiate. We use some diplomat," Trump told Fox News.
China, U.S. Square Off Over Yuan After Wen Deflects European Pressure to Let Currency Rise, Geithner Warns of 'Dangerous Dynamic' From Beijing's Policy
By DAMIAN PALETTA and JOHN W. MILLER
WASHINGTON - The U.S. and China stepped up their confrontation over the valuation of Beijing's currency, prompted by fears that competing foreign-exchange policies could hamper the global economic recovery.
In a surprisingly blunt speech, U.S. Treasury Secretary Timothy Geithner took China to task for maintaining what the U.S. considers a deliberately undervalued exchange rate aimed at helping China's export industries.
IMF, World Bank try to ease currency tensions
IST, Reuters - EconomicTimes.IndiaTimes.com
WASHINGTON: World leaders must defuse currency tensions before they worsen to avoid repeating the mistakes of the Great Depression, the head of the World Bank said on Thursday.
The spirit of global economic cooperation, first forged in 2008 during the darkest days of the financial crisis, was weakening as the recession gives way to an uneven and shaky recovery, the head of the International Monetary Fund said.
Fed Officials Mull Inflation as a Fix
By SUDEEP REDDY - WSJ.com
The Federal Reserve spent the past three decades getting inflation low and keeping it there. But as the U.S. economy struggles and flirts with the prospect of deflation, some central bank officials are publicly broaching a controversial idea: lifting inflation above the Fed's informal target.
The rationale is that getting inflation up even temporarily would push "real" interest rates - nominal rates minus inflation - down, encouraging consumers and businesses to save less and to spend or invest more.
Keiser Report No. 84:
Where are the '60s Hippies Now that They're Needed to Fight Keynesianism?
Posted by Daniel J. Mitchell - Cato @ Liberty
Keynesian economic theory is the social science version of a perpetual motion machine. It assumes that you can increase your prosperity by taking money out of your left pocket and putting it in your right pocket. Not surprisingly, nations that adopt this approach do not succeed. Deficit spending did not work for Hoover and Roosevelt is the 1930s. It did not work for Japan in the 1990s. And it hasn't worked for Bush or Obama.
The Keynesians invariably respond by arguing that these failures simply show that politicians didn't spend enough money. I don't know whether to be amused or horrified, but some Keynesians even say that a war would be the best way of boosting economic growth. Here's a blurb from a story in National Journal.
Silent Crash: Dow Continues Slide vs. Gold
Tarek Saab - SeekingAlpha.com
Rise in equities got ya bullish? Be cautious. Amidst the October push to 11,000, the Dow Jones Industrial Average has continued its calamitous descent against gold which began in 2001 and shows no signs of abating. The silent market crash is real, and the fall of this paper tiger is surreptitiously ferocious.
As I wrote earlier this year, gold is not an investment. Gold is money - real money (see: Aristotle). Today, the rise in the Dow is being shown for what it really is - a crash - by that golden bedrock of monetary stability.
With Prices Soaring Gold Bullion is Suddenly in High Demand
BY JASON SIMPKINS, Managing Editor, Money Morning
The world's wealthiest people are moving their money out of stocks and into gold bullion, sucking the yellow metal up by the ton in some instances.
Fears that the dollar will continue to lose value in the wake of the U.S. Federal Reserve's quantitative easing have boosted the appetite for physical bullion as well as for mining company shares and exchange-traded funds (ETFs), UBS AG (NYSE: UBS) executive Josef Stadler told the Reuters Global Private Banking Summit.
"They don't only buy ETFs or futures; they buy physical gold," said Stadler, who runs the Swiss bank's services for clients with assets of at least $50 million to invest. "We had a clear example of a couple buying over a ton of gold ... and carrying it to another place," Stadler said.
Gold falls after jobs data, Trichet sap rally
ECB president remarks, jobless claims lift U.S. dollar, end gold rally
By Myra P. Saefong, MarketWatch
SAN FRANCISCO (MarketWatch) - Gold futures retreated after hitting a fresh record Thursday, as the dollar bounced back from its lows following better-than-expected U.S. jobless claims figures and remarks from the European Central Bank president.
Gold for December delivery fell $14.80, or 1.1%, to $1,332.90 an ounce on the Comex division of the New York Mercantile Exchange.
Earlier in the session, bullion futures climbed to a record $1,366 an ounce in electronic trading.
Michael Smith, president of T & K Futures and Options Inc., a commodity trading company based in Florida, expects prices to keep rising but "we'll see a lot of corrections in between."
Gold, currency war, ADP, inflation, jobs
IMF Warns of Slower Growth As Currency War Rages On
BY DON MILLER, Associate Editor, Money Morning
Meetings of the Group of Seven (G-7) countries in Washington this week could feature a clash of views that have sparked an international currency war even as the International Monetary Fund (IMF) warned that growth in developed economies is slowing.
The conflict represents a fundamental disagreement about how to sustain the global economic recovery among countries that prefer flexible exchange rates like the United States, and others that are resisting calls to allow its currency to appreciate, like China.
A renewed push for easier monetary policy came as the IMF warned growth in advanced economies is falling short of its forecasts.
IMF chief warns about lack of cooperation Currency war is bad for global economy, Strauss-Kahn says
By Robert Schroeder, MarketWatch
WASHINGTON (MarketWatch) -- Cooperation on the global economy is "decreasing," the head of the International Monetary Fund said Thursday, warning countries about the risks of a so-called currency war.
Momentum to cooperate on economic policies is "not vanishing but decreasing," IMF managing director Dominique Strauss-Kahn told reporters ahead of the annual meetings of the IMF and World Bank. He said that falling cooperation is a threat, because "there's no domestic or national solution to [a] global problem."
Strauss-Kahn added that some countries consider their currency a "weapon," and that the "currency war" being talked about by many is a negative thing.
World economies to meet amid currency threat
IST, AFP - EconomicTimes.IndiaTimes.com
WASHINGTON: A looming currency war and the fate of the global recovery will dominate a meeting of economic powers in Washington later this week, with China's policies in the line of fire.
Finance ministers and central bankers from the IMF's 187 member states will gather from Friday amid mounting concern that the slow recovery is fueling increasingly protectionist policies.
US mumblings that Chinese exports unfairly benefit from an artificially weak yuan have escalated to a din that threatens to dominate the meeting as currency spats also proliferate elsewhere.
NY Fed takes $180m hit on Hilton debt restructuring
By Francesco Guerrera in New York - FT.com
The Federal Reserve Bank of New York has suffered a loss of about $180m on a debt restructuring that staved off financial problems at Hilton, the hotel group owned by Blackstone, the buy-out fund.
The Fed's decision to agree to a lossmaking sale of about $320m of its Hilton debt to Blackstone highlights the problems faced by US authorities as they manage billions of dollars in assets acquired during the financial crisis.
The Fed and other lenders could, however, still recoup their losses because the deal left them with better terms on other portions of the debt, according to people close to the situation.
Niall Ferguson: Will Debt Trigger US Collapse?
From liar loans to liar foreclosures ...
GOOD NEWS - Obama won't sign it!
[Weekend UPDATE and editor's note: In spite of tin-foil hat rumors about the "pocket veto" being trickery, Obama got it RIGHT and returned the bill (H.R. 3808) to the Clerk of the House of representatives today. Now that he has 'cleaned house' by getting rid of bad advisors and handlers things may change for the better. For more insight on Obama's leadership turnabout, listen to the 3-part interview by Bill Deagle at bottom of this page.]
The White House
Office of the Press Secretary
For Immediate Release
October 08, 2010
It is necessary to have further deliberations about the possible unintended impact of H.R. 3808, the "Interstate Recognition of Notarizations Act of 2010," on consumer protections, including those for mortgages, before the bill can be finalized. Accordingly, I am withholding my approval of this bill. (The Pocket Veto Case, 279 U.S. 655 (1929)).
The authors of this bill no doubt had the best intentions in mind when trying to remove impediments to interstate commerce. My Administration will work with them and other leaders in Congress to explore the best ways to achieve this goal going forward.
To leave no doubt that the bill is being vetoed, in addition to withholding my signature, I am returning H.R. 3808 to the Clerk of the House of Representatives, along with this Memorandum of Disapproval.
BARACK OBAMA
THE WHITE HOUSE,
October 8, 2010.
Obama vetoes bill to speed foreclosures
By Jennifer Liberto, senior writer
WASHINGTON (CNNMoney.com) -- President Obama won't sign a bill that would make it easier for courts to clear foreclosures, the White House said Thursday.
White House Press Secretary Robert Gibbs called the president's action a "pocket veto," although there was some dispute over whether Obama can use that method of disapproving legislation.
A pocket veto is a veto that happens with Congress is out of session, but the Senate isn't quite out of session under a bipartisan deal worked out to prevent the president from making recess appointments.
Bank foreclosure cover seen in bill at Obama's desk Update: Obama won't sign bank-friendly bill, but says authors had 'the best intentions'
At the White House blog, Communications Director Dan Pfeiffer explains, "Why President Obama is Not Signing H.R. 3808."
by Scot Paltrow; Editing by Tim Dobbyn - Reuters via RawStory.com
Today, the White House announced that President Obama will not sign H.R. 3808, the Interstate Recognition of Notarizations Act of 2010, and will return the bill to the House of Representatives. The Interstate Recognition of Notarizations Act of 2010 was designed to remove impediments to interstate commerce. While we share this goal, we believe it is necessary to have further deliberations about the intended and unintended impact of this bill on consumer protections, including those for mortgages, before this bill can be finalized.
Concerns on Notaries Overblown in Foreclosure-gate?
NationalMortgageNews.com
Congress quietly passed a bill in late September designed to facilitate the use of electronic mortgage documents, but news reports are raising concerns that it could be used to shield lenders and mortgage processors from liability in "robo-signing" foreclosure cases. These concerns seem to be overblown, according to industry officials.
The Interstate Recognition of Notarizations bill is currently on the President's desk waiting to be signed. The legislation (H.R. 3808) requires state and federal courts to recognize paper or electronic documents with seals from out-of-state notaries.
Putting the Foreclosure Paperwork Scandal in Perspective
by Marian Wang - ProPublica.org
The scandal over flawed paperwork and sloppy practices by mortgage servicers continues to broaden. The issue is complicated, and "robo-signers" -- individuals working for servicers and signing off on thousands of foreclosure documents without much verification -- are only part of the picture. So we brought some of our questions about the broader foreclosure process to Geoff Walsh, an attorney with the National Consumer Law Center, a legal advocacy group for consumers.
Walsh helped fill in some context for us about how the foreclosure process was supposed to work, why it's not working, and why the recourse available to homeowners depends a great deal on where they live. We've edited the interview for length and clarity.
Obama has Legislation that will Bailout Banks (Again)
and Crush Homeowners on the Edge
EconomicPolicyJournal.com
Let's face it. When banks put together the mortgages that have collapsed the real estate system, they were helped tremendously by the Fed money printing of Alan Greenspan. You would think with this help, the banks would have at least done the documentation on the loans correctly. They didn't.
Beacuse of the sloppy documentation, the banks may now technically be unable to foreclose on many of the absurd loans they made. Edge mortgage holders.
The Rube Goldberg Fed
The Economist.com NEIL IRWIN has some interesting reporting on the specific actions the Fed is considering as it prepares to (probably) resume easing in November or December. He writes:
As the Federal Reserve considers what steps it might take to try to boost growth, attention has focused on whether the Fed might buy an enormous quantity of bonds to flood the economy with some specific amount of money.But there's another option that economists at the central bank are examining that has attracted little notice. Instead of just announcing that it will create, say, $500 billion out of thin air and buy bonds with the money, the Fed could instead announce it will target a certain interest rate and then buy Treasury bonds so that rates in the marketplace reach that level.
Rather than targeting the money supply (for an interesting discussion of this policy, see Nick Rowe here), the Fed might promise to keep buying assets until interest rates reached a certain level. Why would it do this?
With Rahm in the Windy City
By R. Emmett Tyrrell, Jr. The American Spectator.org Why did he jump ship?
WASHINGTON -- On Sunday Rahm Emanuel declared his candidacy for mayor of Chicago. Instantaneously, he had problems with his campaign, not the least of which is that he is as much a resident of Chicago as I am. So on Monday I declared my candidacy for mayor of Chicago. Why not? I did it on the national television show of the estimable Sean Hannity, who immediately threw his support behind me. I was born in Chicago, come from a long line of Chicagoans, and like Rahm I am occasionally in town. The place is a gastronomic paradise, a cultural delight with great museums and a fine orchestra, plus opera - surprisingly, Rahm and I have never crossed paths while in town. Supposedly, he attends rock concerts. He could attend the Chicago Symphony but he opts for Bruce Springsteen.
Housing market headed toward big chill
By: Liz Farmer - Washington Examiner.com
Ask any real estate agent what their slow time time of year is and they'll tell you it's always the winter. But this year, winter is coming early - at least in terms of home prices.
According to new data from Clear Capital, home prices in the southern region (which includes D.C., Maryland and Virginia) fell by 0.2 percent from July through September when compared to the previous three months (also the peak of buying season). The report states the "slowdown appears to mark an early onset of the typically weaker markets of fall and winter."
JP Morgan 'thug' breaks into home not in foreclosure
By Daniel Tencer - TheRawStory.com Justice Department to probe foreclosure practices after series of scandalous allegations
In yet another sign that the foreclosure crisis in the US may be getting out of hand, a Florida woman has gone to the press about having her home broken into -- by an agent of her mortgage bank.
Nancy Jacobini of Orange County, Florida, says she was three months behind on her mortgage payments, but not in foreclosure, when she heard an intruder breaking into her home.
First Amendment Ruling Destined to Kill Internet Free Speech
Kurt Nimmo - Infowars.com
It now appears certain the Supreme Court will rule against the First Amendment. "The justices appeared inclined to set a limit to freedom of speech when ordinary citizens are targeted with especially personal and hurtful attacks. The First Amendment says the government may not restrict free speech, but it is less clear when it also shields speakers from private lawsuits," reports the Los Angeles Times this afternoon.
If the Court rules against the First Amendment, it will not only effect demonstrations and public displays, but also curtail freedom of speech on the internet, as one Justice pointed out today.
Microsoft Proposes Government Licensing Internet Access State should have power to block individual computers from connecting to world wide web, claims Charney
Paul Joseph Watson - Infowars.com
A new proposal by a top Microsoft executive would open the door for government licensing to access the Internet, with authorities being empowered to block individual computers from connecting to the world wide web under the pretext of preventing malware attacks.
Speaking to the ISSE 2010 computer security conference in Berlin yesterday, Scott Charney, Microsoft vice president of Trustworthy Computing, said that cybersecurity should mirror public health safety laws, with infected PC's being "quarantined" by government decree and prevented from accessing the Internet.
Don't be fooled by credit score inflation
by Ismat Sarah Mangla - Money Magazine's More Money
Have a 900 credit score? Before you lord it over your friend who can only claim a mere 750, make sure you're comparing apples to apples.
In the September issue of MONEY, I wrote "The quest for the perfect credit score," which chronicled the efforts of three people reaching for a perfect 850 credit score.
Since then, I've received letters from several readers who seem to have these credit score superstars beat. One wrote, "I was a little amused by the...individuals with credit scores in the range of 806 to 813...The last time I checked, my Experian score was 924, with no special effort on my part."
The Return of Debtor's Prison Collection agencies use the criminal justice system to pocket credit card debts.
Greg Beato from the November 2010 issue Reason.com
According to Michael Klozotsky, managing editor of the trade publication insideARM.com, debt collectors contact consumers approximately four billion times a year. With so many contacts, there are bound to be complaints. In 2009, the Federal Trade Commission (FTC) received 88,190 consumer complaints about third-party debt collectors. More than 2,500 of these involved collectors who used threats of violence, or actual violence, while plying their trade. Another 11,505 involved false threats of arrest or property seizure. Approximately zero involved one of the more egregious aspects of debt collection: the way the industry outsources collection efforts to the civil court system, using taxpayer money and government force to strong-arm nickels from low-level deadbeats.
"In 2007, third party collection agencies returned over $40 billion to original creditors via collection efforts," Klozotsky tells me. He's making a case for the virtues of debt collection, and this is his most persuasive talking point: Those recovered billions increase the availability of credit to all consumers and help keep interest rates in check.
America's $4.6 trillion retirement hole
By Ben Rooney, staff reporter
NEW YORK (CNNMoney.com) -- Americans are woefully unprepared to pay for retirement, according to research released Thursday.
On average, U.S. workers would need to have an additional $48,000 when they retire at 65 to ensure they don't run shy of cash in retirement, the Employee Benefit Research Institute said.
All told, the group estimates that the national retirement deficit is $4.6 trillion.
The research group estimated how much money retirees will need for "basic" expenses such as food, shelter and uninsured health care costs. It compared those expenses to the financial resources workers are likely to have at the typical retirement age, including Social Security, pensions and savings plans such as 401(k)s.
Consumers warned on payday-loan scam
BUSINESS FIRST OF LOUISVILLE
Kentucky Attorney General Jack Conway and the Kentucky Department of Financial Institutions are warning consumers about calls from bogus collection agencies attempting to collect on illegal Internet payday loans.
According to a news release, Conway's Office of Consumer Protection and DFI's Consumer Protection Branch have received reports from consumers who have been contacted by collection agencies regarding online payday loan companies.
The callers have threatened Kentucky consumers with arrest, employer notification, wage garnishment, court actions and physical harm to themselves or family members if payment is not made, the release said.
"Consumers should be aware that online payday loans are illegal in Kentucky," DFI Commissioner Charles Vice said in the release. "Using these illegal services subjects the consumer to the possibility of being scammed by the bogus collection agencies."
Job openings remain scarce for unemployed
By Chris Isidore, senior writer
NEW YORK (CNNMoney.com) -- The number of job openings increased slightly in August, but there was no real improvement of the odds that unemployed workers will find a job, a government report showed Thursday.
There were 3.2 million job openings in August, up from 3.1 million positions that were available in July, the Labor Department said.
That means there were 4.6 unemployed job seekers per job opening, unchanged from the previous month.
That's an improvement from the record high of 6.2 job seekers per opening set in July, August and November of last year. But there was little improvement this summer as job growth nearly stalled out.
High unemployment rate "new normal" for U.S., says Stiglitz
China People's Daily
Even if U.S. economy manages to grow, it will be too slow to provide enough jobs needed and high unemployment rate will be a new normal for Americans, said Nobel laureate Joseph Stiglitz on Wednesday.
Speaking at the 7th World Business Forum, an annual symposium regarded as the world's most influential management forum, in New York, Stiglitz warned that the U.S. economy is "still not out of the woods yet" and even risks slipping into a Japanese-style malaise.
Asked how he sees conditions one year from now, Stiglitz said that the economy probably is not going to be a disaster, and there may be positive growth. But, he continued, the growth will be too slow compared with demand for jobs, and the unemployment rate will possibly stay above nine percent, or even ten percent.
"Much higher unemployment is the new normal," he said.
2,500 AA workers remain on furlough
DALLAS BUSINESS JOURNAL - BY Candace Carlisle STAFF WRITER
Union officials say they're hopeful the return of 800 furloughed American Airlines crew members could mean future employment for more than 2,500 workers lingering on the furlough list.
Even after the recall, there will be 797 flight attendants and 1,730 pilots left on furlough, according to union officials.
Flight crews have been short-staffed for some time and it's been a frustrating few years for both working and furloughed employees alike, said Jeff Pharr, national communications coordinator for the Association of Professional Flight Attendants.
"This has been long overdue; man power has been stretched to the very end," Pharr said.
1 million workers lose out on better coverage
By Parija Kavilanz, senior writer
NEW YORK (CNNMoney.com) -- Close to a million insured workers will lose out on a significant bump in insurance coverage promised by health reform next year.
McDonald's, Jack in the Box and other companies won a one-year exemption from a new rule requiring them to raise the maximum amount of coverage they offer employees.
All told 30 companies, also including insurers Cigna and Aetna, received the waiver, affecting 968,765 enrollees.
Companies affected by the law were threatening to drop coverage completely or raise employees' premiums by as much as 200% in order to comply with next year's deadline, according to a government official familiar with the matter.
Apple Readies Verizon iPhone
By YUKARI IWATANI KANE And TING-I TSAI AT&T Inc. is about to lose its lock on the iPhone.
Apple Inc. is making a version of its iPhone that Verizon Wireless will sell early next year, according to people familiar with the matter, ending an exclusive deal with AT&T and sharpening the competition with Google Inc.-based phones.
While Apple is on track to sell 40 million iPhones across the globe this year, the touchscreen handset is facing pressure in the U.S. from phones running Google's Android software, which have been heavily promoted by Verizon Wireless, the biggest U.S. carrier by subscribers.
Apple plans to begin mass producing the new iPhone by the end of the year, and it would be released in the first quarter of 2011, these people said. The phone would resemble the iPhone 4 currently sold by AT&T, but would be based on an alternative wireless technology used by Verizon, these people said.
Verizon, Apple quarreled over iPhone retail options, digital content
By Sam Oliver - AppleInsider.com
Major sticking points in negotiations between Verizon and Apple have reportedly been the wireless carrier's interest in allowing retail partners to sell the iPhone, and Verizon's promotion of its V Cast digital video-on-demand store.
Overnight, The Wall Street Journal filled in some of the holes in its story filed Wednesday afternoon, adding new details of a purported Verizon-compatible CDMA iPhone. Among other changes, the story added specifically that the phone would be coming to Verizon, the largest wireless carrier in the U.S.
The previous report said only that Apple would make a phone that was compatible with Verizon's network. It did not go as far as to say Apple had struck a deal with Verizon -- but that detail was, in fact, later added.
The report also shed some light on previous negotiations between the two companies, alleging that Apple and Verizon butted heads over a number of issues, including the wireless carrier's V Cast digital video store.
Google TV's Dark Side
By: Lance Ulanoff - PCMag.com Oops! Google TV offers no protection, no way to block or control Web's bad elements
The Logitech Revue with Google TV's Web browser offers you no more protection or control than a run-of-the-mill desktop version.
Google TV becomes less mysterious every day. We now have Logitech's pricey Revue box and peripherals to fawn over. Everything looks so sleek and black. The color is fitting; it matches the darkness at the heart of this otherwise innovative product.
Yes, we need a device that brings together our online, desktop, and television-viewing worlds. I want a platform that can break down barriers, with a search engine that traverses all digital mediums and brings back a single, cohesive results page. This is bliss. So why do I think it could turn into a horror show?
How the Phone Companies Are Screwing America: The $320 Billion Broadband Rip-Off
AlterNet / By David Rosen and Bruce Kushnick
Americans are stuck with an inferior and overpriced communications system, compared with the rest of the world, and we're being ripped off in the process.
Since 1991, the telecom companies have pocketed an estimated $320 billion --- that's about $3,000 per household.
This is a conservative estimate of the wide-scale plunder that includes monies garnered from hidden rate hikes, depreciation allowances, write-offs and other schemes. Ironically, in 2009, the FCC's National Broadband plan claimed it will cost about $350 billion to fully upgrade America's infrastructure.
The principal consequence of the great broadband con is not only that Americans are stuck with an inferior and overpriced communications system, but the nation's global economic competitiveness has been undermined.
Independence for the Constitution State?
By Lisa Fabrizio - The American Spectator.org Connecticut voters may just overthrow the Democratic tyranny that has gripped them.
The other night in my hometown of Stamford, Connecticut, I had the fortune to be in the audience for a marvelous local production of 1776; a show which, in its original incarnation on Broadway in 1969, won a Tony Award for best musical over the likes of such blockbusters as Hair and Zorba. Having seen a 1997 revival and the somewhat disappointing movie version numerous times, I was surprised that my fellow audience members did not get all the jokes, and indeed laughed during the most poignant moments of the show.
Living as I have in Connecticut all my life I shouldn't have been surprised, given the state of education in our state. Yet, the show's climax -- the victorious conclusion of the vote for American Independence -- was accompanied by a hearty round of applause from folks who hopefully recognized their state's key role in that historic occasion.
Government Fails to Collect Reliable Information on Taxpayer-Funded Contracts, Including Security Personnel, in Iraq and Afghanistan
By Edwin Mora - CNSNews.com
(CNSNews.com) - Under federal law, the U.S. government is required to compile information on all taxpayer-funded contracts - and the people working on those contracts, including security personnel -- in Iraq and Afghanistan.
But a recent audit conducted by the Government Accountability Office (GAO) found that federal agencies failed to "reliably" keep track of the information required by Congress.
"[T]he agencies' lack of complete and accurate information may inhibit planning, increase cost, and introduce unnecessary risk," warned the GAO in a report dated Oct. 1.
Motors of Integration German University Starts Seminars for Imams
By Anna Reimann - Spiegel.de
They intervene in cultural conflicts, marital disputes and dealings with the German authorities: Muslim spiritual leaders deal with the everyday and the soul. Osnabrück University has become the first in Germany to offer seminars for imams. Many hope it will prove a boon for integration.
"Islam also belongs to Germany," said German President Christian Wulff during Sunday's speech to mark the 20th anniversary of German reunification. The comments provoked massive outrage.
Conservative politicians are now warning against treating Islam the same as Christianity and Judaism. But parallel to the heated debate, democratic Islam is embedding itself in Germany: For the first time ever, imams are going to be trained at a German university. It is a development long fought for by many German politicians.
Judge Andrew Napolitano on Health Care Lawsuits 10/06/10
Hungary says toxic red sludge has reached the Danube; countries downriver test their water
PABLO GORONDI - AP Writer - ChicagoTribune.com
OLONTAR, Hungary (AP) - The toxic red sludge that burst out of a Hungarian factory's reservoir reached the mighty Danube on Thursday after wreaking havoc on smaller rivers and creeks, and downstream nations rushed to test their waters.
The European Union and environmental officials fear an environmental catastrophe affecting half a dozen nations if the red sludge, a waste product of making aluminum, contaminates the Danube, Europe's second-longest river.
Officials from Croatia, Serbia and Romania were taking river samples every few hours Thursday but hoping that the Danube's huge water volume would blunt the impact of the spill.
Watershed Strategic Ramifications Expected
from Pakistan Flood Disaster
GlobalIntelligenceReport
Flooding along the Indus River Valley in Pakistan, beginning in July 2010, seems set to be a pivotal strategic factor in the Northern Indian Ocean and Persian Gulf region. It should be expected to significantly affect the conduct and outcome of the US-led Coalition military operations in Afghanistan.
Despite this, the US and international response has been minimal, and just more than half the $460-million requested by the United Nations for disaster relief had been disbursed by mid-September 2010.
U.S. apologizes to Pakistan for NATO attack
that led to shutdown of key border crossing into Afghanistan Dozens of fuel tankers have been blown up since the closure of the Torkham border crossing. The U.S. apology is seen as a big step toward getting Pakistan to reopen the route.
By Alex Rodriguez, Los Angeles Times
Reporting from Islamabad, Pakistan - The Pakistani government's decision to shut down a border crossing used by trucks and tankers ferrying fuel and supplies to NATO troops in Afghanistan has created a massive logjam that Islamic militants have exploited with devastating ferocity.
Since Islamabad ordered the closure of the Torkham border crossing in retaliation for a missile strike that killed two Pakistani soldiers, dozens of fuel tankers have been set ablaze across the country. In some of the attacks, militants rode up on motorcycles to clusters of poorly guarded tankers and firebombed the vehicles, filling the sky with massive plumes of fire and black smoke.
'The Americans Want to Blackmail Us' European Parliament Balks at US Data Deals
By Hans-Jürgen Schlamp in Brussels - Spiegel.de
Representatives of US security agencies want further concessions from the EU to ensure free access to police computers, bank transfers and airline passenger data in the fight against terror. But members of the European Parliament have said they will resist the moves.
Washington's army of diplomats in Europe has been taking on one country at a time. Germany stood at the top of the list and, initially, surrendered without even a whimper to the American demands. In 2008, the federal government in Berlin signed an agreement pushed by Washington allowing American officials wide-ranging access to the databases of German security agencies. It was only after leaders in Hamburg raised their objections to the deal that it was, temporarily, stalled in the Bundesrat, Germany's upper legislative chamber, which represents the interests of the states. The city-state has since withdrawn its objections after securing minor concessions on data protection provisions in the document, and the treaty is now set to be approved.
Actually We Aren't Running the World
Posted by Benjamin H. Friedman - Cato @ Liberty
Bloggers have already noted the most glaring problems with Arthur Brooks, Edwin Feulner and Bill Kristol's Monday Wall Street Journal op-ed, "Peace Doesn't Keep Itself," which worries that conservatives are figuring out that trying to run the world is not conservative.
The op-ed pretends that the fact that defense spending isn't the largest cause of the deficit means it isn't a cause of the deficit. It obscures the fact that we spend more on defense than we did in the Cold War by counting the defense budget as a portion of the economy without noting the latter has grown faster than the former.
So I can limit myself to less obvious angles. The first is that neoconservatives like Kristol are for increasing the defense budget no matter what. For them the military is basically an expression of national awesomeness (to use an academic term). Enemies and other details, like what we spend already, come up mainly in the justification phase.
Obama Administration Supports Afghan-Taliban Reconciliation Under Certain Conditions, But Will Those Conditions Be Met?
By Patrick Goodenough
(CNSNews.com) - As Afghan President Hamid Karzai on Thursday convenes the first meeting of a new "peace council" designed to oversee peace talks with the Taliban, news reports indicate that some exchanges already are underway, and that important U.S. government criteria for reconciliation may be at risk.
The key conditions set by the Obama administration for Taliban leaders seeking reconciliation with Kabul are a pledge to stop fighting, to end support for al-Qaeda, and to abide by the Afghan constitution.
State Department spokesman Philip Crowley reiterated the "red lines" on Wednesday, adding that "anyone who adopts those criteria, in our view, can play a role in the future of Afghanistan."
Obama Desperately Trying to Save His Own Senate Seat
By: CNN Senior White House Correspondent Ed Henry
(CNN) - Eager to prevent an embarrassing loss of his old Senate seat, President Obama is heading to Chicago Thursday for two fundraisers on behalf of Democratic Senate nominee Alexi Giannoulias, and CNN has learned Obama will be returning home yet again in the final days of the midterm election to try and help Giannoulias win a race that could determine who controls the chamber next year.
Two senior Democratic officials told CNN to expect Obama to return to Illinois at least one more time in the final few weeks of the campaign in order to go to bat for Giannoulias, who is locked in a virtual dead heat with Republican nominee Mark Kirk.
Obama reshapes administration for a fresh strategy White House staff changes are being made with an eye toward achieving goals through executive actions rather than by trying to push plans through the next Congress, which is expected to be even more hostile to the president.
By Peter Nicholas and Christi Parsons, Tribune Washington Bureau - LATimes.com
Reporting from Washington - As President Obama remakes his senior staff, he is also shaping a new approach for the second half of his term: to advance his agenda through executive actions he can take on his own, rather than pushing plans through an increasingly hostile Congress.
A flurry of staff departures and promotions is playing out as the White House ends a nearly two-year period of intense legislative activity. Where the original staff was built to give Obama maximum clout in Congress, the new White House team won't need the same leverage with lawmakers.
Follow-up to above article - interesting interview and discussion on Obama's strategy for reshaping the White House ... not what you might think.
PBS - 'Robo-Signing' Paperwork Breakdown Leaves Many Houses in Foreclosure Limbo
.... more foreclosure articles below.
High Noon In America
By Giordano Bruno- Neithercorp Press
Time is running out in the little western town of Hadleyville. Frank Miller, the leader of a violent gang that terrorized the hapless settlement years ago, was sent to the gallows by Will Kane, the local marshal, but the justice system failed, and now after so long, Frank Miller is free, heading back to Hadleyville on the noon train to meet his men, and take revenge ...
Will Kane is just married, just retired, and just about to leave town when he gets the news that the tyrant he had deposed is about to waltz back into the parish with impunity and begin killing the people who sent him away. Everyone is afraid of reverting back to the terrible past they had left behind them. Kane decides to stay in town until the matter is resolved, and he reaches out to the local community for assistance in stopping Miller's band of thugs. There's just one problem; no one will help him ...
Fear undermines America's recovery
By Alan Greenspan - FT.com
Although rising moderately this year, US fixed capital investment has fallen far short of the level that history suggests should have occurred given the recent dramatic surge in corporate profitability. Combined with a collapse of long-term illiquid investments by households, they have frustrated economic recovery. These shortfalls, the result of widespread private-sector anxiety over America's future, have defused much, if not most, of the impact of the administration's fiscal stimulus. Moreover, the activism embodied in such programmes has itself stoked the degree of anxiety.
The instinctive reaction of businessmen and householders to uncertainty is to disengage from those activities that require confident predictions of how the future will unfold. For non-financial corporations (half of gross domestic product), the disengagement is best measured by the share of liquid cash flow allocated to illiquid long-term fixed asset investment. In the first half of 2010, that share fell to 79 per cent, its lowest reading in the 58 years for which data are available.
Bernanke Tells the Truth: The United States is on the Brink of Financial Disaster
By Robert Wenzel - Economic Policy Journal
Yesterday, Federal Reserve Chairman Ben Bernanke delivered a speech before the the Annual Meeting of the Rhode Island Public Expenditure Council in Providence, Rhode Island. In the speech, he warned about the current state of the government finances. His conclusion, the situation is dire and "unsustainable".
It is remarkable that mainstream media has given this speech no coverage. I repeat, the central banker of the United States says in his own words:
Rick Santelli Rips Tim Geithner and Quantitative Easing
Gold settles at record, takes aim at $1,350
Copper, palladium, platinum and silver also rally to fresh highs
By Claudia Assis and Myra P. Saefong, MarketWatch
SAN FRANCISCO (MarketWatch) - Gold futures on Wednesday settled at their 14th record high in less than a month, on the back of a weaker dollar and continued fears about inflation and currency debasement.
Investors flocked to gold but didn't forget silver, which topped $23 an ounce to hit a fresh 30-year high, and palladium, which reached its highest settlement in more than nine years. Copper settled at its best in more than two years, and platinum finished at multimonth highs.
Gold May Jump to $2,200, Copper Will Reach Record, Kooi Says
By Yi Tian and Debarati Roy
Oct. 6 (Bloomberg) -- Gold prices may surge 64 percent and copper will jump to the highest level ever as the dollar tumbles, said Mari Kooi, the chief executive officer of Wolf Asset Management International LLC.
The greenback may fall as much as 20 percent in the next eight to 12 months against a basket of currencies including the South Africa rand and the Canadian dollar, said Kooi, who manages $1 billion and is shifting assets into raw-material investments. The decline will send gold as high as $2,200 an ounce, she said yesterday by telephone from London.
Comex Gold hits another record high on slumping US Dollar
By Jim Wyckoff of Kitco News
Comex gold prices on Wednesday ended modestly higher and hit another new all-time record high of $1,351.00 an ounce in December futures. More weakness in the U.S. dollar had investors once again seeking gold. December Comex gold last traded up $5.30 an ounce at $1,345.60. Spot gold was last quoted up $3.90 at $1,345.00.
The U.S. dollar index had been trading near steady Wednesday morning, but then wilted and hit another fresh 8.5-month low when the ADP jobs report showed private-sector U.S. jobs fell by 39,000 last month. Analysts had forecast that report to show a gain of 20,000 jobs in September.
Record High Gold all about Fear
By Greg Hunter's USAWatchdog.com
There has been one record high after another for gold. They say the markets are ruled by fear and greed. In this case, it is simply fear that is driving the yellow metal higher day after day. There is a perfect storm of doom in the economy right now. The biggest problem is debt. It just went parabolic with the revelation that the banks are stuck with trillions of dollars in worthless mortgage backed securities. I wrote all about this Monday in a post called "Could Foreclosure Fraud Cause a Banking Calamity?" The U.S. government is going to come to the rescue and bailout the banks once again. The problem is so enormous that a government bailout will not be big enough to fix the problem, but merely put off an inevitable financial collapse. This will cause the dollar to die a not so slow death and cause massive inflation (or hyperinflation) which, in turn, will also kill the economy.
Gold Climbs the Bull Market Wall of Worry
Bob Chapman - TheInternationalForecaster.com
Joblessness dogs the economy, its worse than the 1930's today, suffering and pain on the streets, no incentive to create jobs, living standards continue to fall, pray the incumbents are defeated, blame for the Flash Cras, TARP sequels coming.
Joblessness still dogs the economy, which needs 125,000 jobs monthly just to keep up with population growth. As we await September's statistics we wonder if they'll be as bad as August's loss of 54,000 jobs? This unfortunate situation has been going on for more than three years; 22 million Americans do not have jobs and some 10,000 million additional are forced to work part-time, some 34 hours a week. Having real unemployment at 22-5/8% makes recovery very difficult. That figures is U-6 less the bogus birth/death ratio. It's not surprising that credit card and mortgage debt go unpaid as default and foreclosure accelerate. These conditions are certainly a drag on sales. As those sales falter businesses lay off more workers, which exacerbates the problem.
The Rich Move to Metals
By: Dr. Jeffrey Lewis - GoldSeek.com
Before this year, precious metals demand was mostly local, with a few large institutions and investment banks buying shorts on precious metals to mitigate any possible increase in price. However, as time goes on and investment banks around the global shutter their trading desks, big money is now moving into metals. So much big money is moving, in fact, that a number of investment banks are opening up new vaults to keep up with exploding demand.
Major Moves into Metals
JP Morgan was the first to reopen an underground vault in New York to cater to its wealthiest clientele. The company closed the vault in the 1990s when precious metals reached all time lows, but has since reopened it to make room for large buyers of gold to store their assets safely.
China, Russia keep stocking up on gold reserves
SEOUL (Commodity Online) : Two of the world's top gold reserves holders, Russia and China are likely to continue increasing their gold holdings to balance their total global reserves, according to a top WGC official.
George Milling-Stanley, managing director of government affairs at the World Gold Council said the Philippines also building up gold reserves using dollar incomes to buy more gold.
How far could the dollar fall out of bed? Analysts expect commodity currencies to be the beneficiaries of diversification out of the big four currencies
Author: Barry Sergeant - MineWeb.com
JOHANNESBURG - On Tuesday the dollar index touched its lowest levels since January, as the dollar gold bullion price pushed to fresh record levels. Commodity prices, which are inevitably quoted in dollars, invariably display an inverse correlation to the direction of the dollar, which has been in a great bear market since January 2002.
Across this period, the dollar index has fallen from 120.20 points to the current level of 78.415; gold bullion soared from USD 282.55 to USD 1,315.75 an ounce. Beyond the dollar kicker, mineral prices generally have benefited from global growth, increasingly dominated by emerging nations. In itself, China has for years ranked as the epicenter of global economic growth.
Dollar Drops to 15-year Low Against Yen as Companies Cut Jobs
By Allison Bennett
Oct. 6 (Bloomberg) -- The dollar slumped to a 15-year low against the yen after a private report showed U.S. companies unexpectedly cut jobs last month, fueling speculation the Federal Reserve will buy U.S. assets to spur a slowing economy.
The euro touched an eight-month high against the greenback as the ADP Employer Services data added to concern a Labor Department report in two days will show lower-than-forecast job growth. The Dollar Index fell to levels last seen in January as the U.S. central bank is forecast to join the Bank of Japan in increasing purchases of government debt to spur growth. Treasury Secretary Timothy F. Geithner said a "damaging dynamic" of large economies keeping their currencies undervalued can cause inflation and asset bubbles.
Nations see dip of dollar as threat to economies U.S. pushes China on yuan
By Patrice Hill - The Washington Times
While the United States has been fussing at China for gaining an advantage in trade by depressing the value of its currency, other nations - while agreeing about China - are increasingly focused on the falling dollar and concern that the U.S. may be doing the same thing.
Treasury Secretary Timothy F. Geithner on Wednesday stepped up U.S. demands that China stop closely controlling the value of its currency and allow it to rise against the dollar, suggesting that the Asian giant may be violating its pledge last year to move toward freer exchange rates with other Group of 20 economic powers.
China, U.S. Square Off Over Yuan After Wen Deflects European Pressure to Let Currency Rise, Geithner Warns of 'Dangerous Dynamic' From Beijing's Policy
By DAMIAN PALETTA and JOHN W. MILLER - WSJ.com
WASHINGTON - The U.S. and China stepped up their confrontation over the valuation of Beijing's currency, prompted by fears that competing foreign-exchange policies could hamper the global economic recovery.
In a surprisingly blunt speech, U.S. Treasury Secretary Timothy Geithner took China to task for maintaining what the U.S. considers a deliberately undervalued exchange rate aimed at helping China's export industries.
"When large economies with undervalued exchange rates act to keep the currency from appreciating, that encourages other countries to do the same," said Mr. Geithner, using language that referred directly to China, in an address at the Brookings Institution, a Washington think tank. "This sets off a dangerous dynamic" as nations compete to keep their currencies undervalued.
China Stiffens Opposition to Rapid Yuan Appreciation; Tells EU to "Back off"
By Zijing Wu and James G. Neuger
Oct. 6 (Bloomberg) -- China stiffened its opposition to a rapid appreciation of the yuan, setting the stage for a confrontation over exchange rates at this week's international monetary meetings in Washington.
Premier Wen Jiabao said China will stick to its policy of gradually increasing the currency's flexibility and lashed out at European Union leaders for teaming with the U.S. to pressure the Chinese government.
China's Wen Warns of 'Disaster' in Rapid Appreciation of Yuan
By Zijing Wu and James G. Neuger
Oct. 6 (Bloomberg) -- Chinese Premier Wen Jiabao said a rapid increase of the yuan would hobble China's economy, dealing a fresh rebuke to U.S. and European calls for a higher exchange rate.
Wen said China will stick to its policy of gradually increasing the currency's flexibility and faulted European leaders for teaming with the U.S. to pressure the Chinese government.
"If the yuan isn't stable, it will bring disaster to China and the world," Wen told a business conference before a Europe- China summit in Brussels later today. "If we increase the yuan by 20 percent-40 percent as some people are calling for, many of our factories will shut down and society will be in turmoil. If China's economy goes down, it's not good for the world economy."
Senator Menendez Questions Sec. Geithner on Chinese Currency Valuation in the Banking Committee
U.S., Impatient Over China's Progress on Currency, Looks to I.M.F. for Help
By SEWELL CHAN - NYTimes.com
WASHINGTON - The United States is increasingly looking to the International Monetary Fund to hold countries like China accountable for "rebalancing" the global economy, a Treasury Department official said Tuesday.
Exchange rates are expected to be a major topic when finance ministers gather here this weekend for the annual meetings of the I.M.F. and the World Bank.
Debt Crisis Dims IMF Outlook
By IAN TALLEY - WSJ.com
WASHINGTON - Global growth will slow more than expected in 2011 as European public-debt problems continue to undermine the recovery in industrialized nations, the International Monetary Fund said Wednesday.
Emerging markets such as China and India are forecast to remain growth champions, but advanced economies are cutting budgets amid the sovereign-debt crisis.
All told, the IMF predicted the world economy will expand 4.8% in 2010 and 4.2% in 2011.
IMF Calls for Huge New Round of Bank Bailouts
George Washington's blog The IMF is calling for a huge new round of bank bailouts.
As the Telegraph noted yesterday:
Lenders across Europe and the US are facing a $4 trillion refinancing hurdle in the coming 24 months and many still need to recapitalise, the Washington-based organisation said in its Global Financial Stability Report. Governments will have to inject fresh equity into banks - particularly in Spain, Germany and the US - as well as prop up their funding structures by extending emergency support.
Prop up their funding structures?
Virtually all leading independent economists have said that the too big to fails must be broken up, or the economy won't be able to recover, and that smaller banks actually lend more into the economy than the mega-banks (and see this).
Geithner Sees 'Damaging Dynamic' as Countries Keep Currencies Undervalued
By Ian Katz and Rebecca Christie
Oct. 6 (Bloomberg) -- Treasury Secretary Timothy F. Geithner said a "damaging dynamic" of large economies keeping their currencies undervalued can cause inflation and asset bubbles, and called on countries to coordinate their policies.
"More and more countries face stronger pressure to lean against the market forces pushing up the value of their currencies," Geithner said in a speech today at the Brookings Institution in Washington. He said currencies are "inherently a multilateral issue. It's much easier to solve if countries come together and do things to complement each other."
Geithner Calls for Global Cooperation on Currency
By SEWELL CHAN - NYTimes.com
WASHINGTON - Treasury Secretary Timothy F. Geithner warned Wednesday that the necessary rebalancing of the economy was "at risk of being undermined" by countries trying to prevent their currencies from rising in value.
Mr. Geithner, in a speech at the Brookings Institution, said that some of the world's biggest economies should "focus on strengthening growth, rather than risking a premature shift to restraint" by cutting government spending too rapidly.
Geithner steps up pressure on China When large economies undervalue rates, other countries follow: Geithner - By Ronald D. Orol, MarketWatch
WASHINGTON (MarketWatch) - Treasury Secretary Timothy Geithner on Wednesday stepped up the pressure on China, effectively blaming the world's number-two economy for the emergence of what some are calling a "currency war" ahead of an important global gathering.
The U.S. believes that it is important to see more progress by major emerging economies to move to more flexible, market-oriented exchange rate systems, Geithner said in advance of an annual International Monetary Fund gathering in Washington set for later this week.
"It is unfair to countries that were already running more flexible regimes and let their currencies appreciate," Geithner said, focusing a large part of his comments at a Brookings Institution event on China's exchange rate policy.
FIRE TIM GEITHNER!
Spitzer Goes After Geithner In The First Minute Of His First Show!
Brazil's Treasury Allowed to Step Up Dollar Purchases
By Andre Soliani
Oct. 6 (Bloomberg) -- Brazil's Treasury won authorization to step up dollar purchases for debt payments as the government increases efforts to temper the real's rally.
The National Monetary Council gave the Treasury permission to buy foreign currency for external debt payments as much as 1,500 days ahead of maturity, up from a previous 750 days, according to statement posted on the central bank's information system, known as Sisbacen. As of August, Brazil had 30.5 billion reais ($18.2 billion) in external debt due in the next 48 months compared with 17.5 billion reais due in the next two years, Treasury figures show.
Hatzius Says Fed Easing Measures Will Probably 'Fall Short'
By Bob Willis
Oct. 5 (Bloomberg) -- Jan Hatzius, chief U.S. economist at Goldman Sachs Group Inc, said that while the Federal Reserve will "very likely" take more steps to ease monetary policy, asset purchases will have a limited effect on the economy.
"They're going to do quite a lot but it's probably still going to fall short," Hatzius said today at a fiscal policy conference in Washington. "There is going to be a natural bias towards caution among monetary policy makers."
The Incredible Two-Day Jump in US Treasure Debt
By The Mogambo Guru - The DailyReckoning.com
10/06/10 Tampa, Florida - Things are getting so, so, so weird that I was locked inside the Mogambo Bunker Of Panic (MBOP), looking through the periscope to keep a vigilant watch for the social explosion outside that was coming, I figured, so, so soon, with my finger on the trigger of something fully loaded and reassuringly .45 caliber, and a slice of yummy pizza in my one free hand to keep my energy level up via the universal Magic Of The Pepperoni (MOTP).
To show you that I am not over-reacting like the hyper-excitable, gun-nut, gold-bug, Austrian school of economics kind of weird guy that I actually am, here is an example of the corrupt, game-playing crap going on with the Federal Reserve and the Treasury: On Wednesday, 9/29/10, the national debt was $13.466 trillion. The next day, 9/30, it goes to $13.561 trillion. Again, "the next day," 10/1, the start of the new federal fiscal year, it rises to $13.610 trillion!
The Mutual Fund in the 'Flash Crash' Waddell & Reed's $27 Billion Asset Strategy Portfolio, Part of a New Breed, Acts Like a Hedge Fund
By E.S. BROWNING And JENNY STRASBURG - WSJ.com
Overland Park, Kan.
In the quest to find the culprit in the May 6 "flash crash," regulators have pointed the finger at a little-known mutual fund based in a nondescript office park outside Kansas City.
But the fund in question - the $27 billion Asset Strategy Fund - is no average mutual fund. Run by Waddell & Reed Financial Inc., the fund is bigger than most hedge funds and, by some measures, acts like one. It is part of a rapidly growing breed of U.S. mutual funds that can trade in almost anything they want, including hedging during times of trouble.
Central Bankers are Paid to Lie - Buy Corn
By Frederick Sheehan - The DailyReckoning.com
10/06/10 North Weymouth, Massachusetts -
"I assure this committee that, if I am confirmed, I will be strictly independent of all political influences and will be guided solely by the Federal Reserve's mandate from Congress and by the public interest."
Prospective Federal Reserve Board Chairman Ben Bernanke, confirmation hearing, 2005
"The last duty of a central banker is to tell the public the truth."
Federal Reserve Board Vice Chairman Alan Blinder, Nightly Business Report, 1994
"If we exerted our 'independence' we'd certainly lose our independence."
Former Federal Reserve Board Chairman Arthur Burns, 1981 (possibly paraphrased)
NO WAY OUT
By Doug Casey - FinancialSense.com
I really dislike sounding inflammatory. Saying that things are going to go terribly wrong runs a risk of being classed with those who think the world will end in December 2012 because of something Nostradamus or the Bible says, or because that's what the Mayan calendar predicts.
This is different. In the real world, cause has effect. Nobody has a crystal ball, but a good economist (there are some, though very few, in existence) can definitely pinpoint causes and estimate not only what their immediate and direct effects are likely to be (that's not hard; a smart kid can usually do that) but the indirect and delayed effects.
Goldman Sachs Says U.S. Economy May Be 'Fairly Bad' or 'Very Bad'
By Wes Goodman
Oct. 6 (Bloomberg) -- Goldman Sachs Group Inc. said the U.S. economy is likely to be "fairly bad" or "very bad" over the next six to nine months.
"We see two main scenarios," analysts led by Jan Hatzius, the New York-based chief U.S. economist at the company, wrote in an e-mail to clients. "A fairly bad one in which the economy grows at a 1 1/2 percent to 2 percent rate through the middle of next year and the unemployment rate rises moderately to 10 percent, and a very bad one in which the economy returns to an outright recession."
Obama's Tax Pitch: The Income Gap Pits Millionaires Against the Middle Class - By Rebecca Christie
Oct. 6 (Bloomberg) -- President Barack Obama has shifted his central argument against the Bush-era tax cuts to make the income gap as much a voter concern as the budget gap.
Since Sept. 3, Obama has chided Republicans for wanting to extend tax cuts for "millionaires and billionaires" -- a line he repeated in a morning television interview, a weekly radio address, backyard chats in Des Moines and Albuquerque, and three times during one speech at a community college in Cuyahoga County, Ohio. Before then, administration economists cast taxing the wealthy largely as a matter of fiscal prudence -- a way to free up $700 billion from the deficit over the next 10 years.
Wall Street Says Women Worth Less as Disparity Widens
By Dawn Kopecki
Oct. 6 (Bloomberg) -- Nancy Davis, a rising star at Goldman Sachs Group Inc., left in January 2008 after an eight-year run betting the firm's money on derivatives to become a portfolio manager at Highbridge Capital Management LLC. She lost that job 10 months later when the hedge fund cut back in the recession.
For women in the financial-services industry like Davis, who's still unemployed, the last few years haven't been kind. More than five times as many women as men lost their jobs in the three years after July 2007, and pay for full-time managers compared with their male counterparts worsened between 2000 and 2007, according to U.S. government data.
Bernanke Counters Fed Unity Doubt as Regional Chiefs Echo Views
By Caroline Salas
Oct. 6 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke is leaving little doubt that he has enough support for more unconventional easing as soon as November.
In one week, New York Fed President William Dudley, the Boston Fed's Eric Rosengren and Chicago's Charles Evans advocated further Fed action. Bernanke himself said Oct. 4 that restarting large-scale asset purchases would probably spur growth, after saying last week that the central bank has a duty to aid the economy as U.S. unemployment holds near 10 percent.
Stiglitz Says Fed Rate Policy May Cause Asset Bubbles Fed's Rates Causing Liquidity 'Flood,' Currency Misalignment
By Alex Kowalski
Oct. 6 (Bloomberg) -- Nobel Prize-winning economist Joseph Stiglitz said the Federal Reserve's policy of cutting interest rates to a record low has had repercussions worldwide, including currency misalignments and the risk of asset price bubbles.
"Fed policy was supposed to reignite the American economy, but it's not doing that," Stiglitz, a professor at Columbia University in New York since 2001, said in a Bloomberg Television interview today. "The flood of liquidity is going abroad and causing problems all over the world."
Prof. Bill Black - Financial crisis probe, prosecution failure -
Fire Summers, Geithner, Holder
City budgets slammed by falling property taxes
By Tami Luhby - CNNMoney.com
NEW YORK (CNNMoney.com) -- The housing crisis is finally catching up with cities -- and the impact isn't going to be pretty.
Property tax revenues started to decline in 2010 after years of growth, according to a report released by the National League of Cities on Wednesday. Cities expect property tax revenues to fall by 1.8% in 2010, after rising by 4.2% in 2009.
This drop lagged the housing market collapse because property tax bills are based on assessments, which are slow to adjust to market value changes.
Struggling Colorado homeowners to get more loans from feds
DENVER BUSINESS JOURNAL
The federal government will provide another $41.3 million in loans to Colorado homeowners struggling to make mortgage payments because of the bad economy, the U.S. Department of Housing and Urban Development said Wednesday.
The funds coming to this state are part of the Dodd-Frank Wall Street Reform and Consumer Protection Act, signed into law in July by President Obama. The new law created the Emergency Homeowners Loan Program (EHLP), administered by HUD, to provide $1 billion in loans.
CONSUMER DELEVERAGING = COMMERCIAL REAL ESTATE COLLAPSE
JimQuinn - TheBurningPlatform.com
There is a Part 2 to the story of Consumer Deleveraging that will play out over the next decade. Consumers will deleverage because they must. They have no choice. Boomers have come to the shocking realization that you can't get wealthy or retire by borrowing and spending. As consumers buy $500 billion less stuff per year, retailers across the land will suffer. To give some perspective on our consumer society, here are a few facts:
There are 105,000 shopping centers in the U.S. In comparison, all of Europe has only 5,700 shopping centers.
There are 1.2 million retail establishments in the U.S. per the Census Bureau.
There is 14.2 BILLION square feet of retail space in the U.S. This is 46 square feet per person in the U.S., compared to 2 square feet per capita in India, 1.5 square feet per capita in Mexico, 23 square feet per capita in the United Kingdom, 13 square feet per capita in Canada, and 6.5 square feet per capita in Australia.
California has nearly 9 years of housing supply
MLS lists 176,000 properties while total shadow inventory is over 468,000. A detailed real estate count of all 58 California counties.
I've never made the giant attempt of gathering MLS data for every one of the 58 counties in California. Let us not even discuss gathering foreclosure data for each of the counties on an individualized basis. Yet this is necessary if we want an accurate count of shadow inventory. Over the weekend I went ahead and gathered MLS data and foreclosure data for each county to put together the full inventory for the entire state. What did I find? The data is startling because it shows that California, should it keep the current pace of things in the real estate market, won't empty out the entire inventory for nearly 9 years! Let us first take a snapshot of total MLS data and also MLS + foreclosure data.
As California Goes: Potential for Statewide Moratorium on Foreclosures Could Effectively End Them
By: David Dayen
When the House Speaker got involved in the foreclosure fraud mess and called for investigations of the lending industry, the media took notice. And this is becoming a bipartisan affair. The Justice Department announced that they're looking into the matter. Democratic Senators like Robert Menendez and Al Franken have continued to put on the pressure. In addition to Democratic officials in Maryland, Texas Attorney General Greg Abbott, a Republican, ordered the suspension of all foreclosures in his state, a huge move. And take a look at the comment from John Boehner's spokesman on this situation:
Michael Steel, a spokesman for House Minority Leader Rep. John Boehner (R-Ohio), said, "At a time when economic uncertainty and unemployment are putting great pressure on homeowners and the housing market, it is imperative that we get all of the facts about this situation, and quickly."
I think we're close to politicians calling for a nationwide foreclosure moratorium, including in non-judicial foreclosure states. The AFL-CIO is already there. One analyst told WaPo "Right now, there's no question we're headed into a moratorium period."
Real estate downturn could last 8 years: IMF
By Steve Goldstein, MarketWatch
WASHINGTON (MarketWatch) - The prospects in the global real estate sector are "dismal," with a downturn that could last eight years, the International Monetary Fund warned Wednesday.
The IMF sees problems both in the "bust" countries, such as the United States, Spain and Ireland, and the "rebound" economies, such as the Asia-Pacific region, most Scandinavian countries, and Canada.
In the United States, residential investment remains severely depressed compared with past cycles, which the report said could be partly explained by the pattern in house prices and outstanding household debt. Making matters worse, the U.S. states where the house price bust was more pronounced are also where unemployment has increased the most.
Congressman Grayson: "Breaking and Entering Does Not Become Legal Just Because a Big Bank Does It. The Rule of Law Must Apply Equally to Everyone"
George Washington's Blog
Congressman Alan Grayson's office sent me the following statement by the Congressman on the rampant foreclosure fraud, and the unlawful breaking and entering into people's homes by the banks:
First we see systemic fraud in the foreclosure process. Now we're literally seeing banks breaking into people's homes and terrifying homeowners. The big banks claim these confrontations are a result of innocent errors. Come on! How many times are we going to force a woman to cower in her bathroom for fifteen minutes and dial 911 while a man breaks into a home, before we do something about it?
Foreclosure Fraud Hits Housing Market
In foreclosure controversy, problems run deeper than flawed paperwork
By Brady Dennis and Ariana Eunjung Cha - Washington Post Staff Writers
Millions of U.S. mortgages have been shuttled around the global financial system - sold and resold by firms - without the documents that traditionally prove who legally owns the loans.
Now, as many of these loans have fallen into default and banks have sought to seize homes, judges around the country have increasingly ruled that lenders had no right to foreclose, because they lacked clear title.
These fundamental concerns over ownership extend beyond those that surfaced over the past two weeks amid reports of fraudulent loan documents and corporate "robo-signers."
Ohio accuses Ally of 'fraudulent' foreclosures
By Ben Rooney - CNNMoney.com
NEW YORK (CNNMoney.com) -- Ally Financial and its subsidiary GMAC Mortgage are being sued by the Ohio Attorney General for allegedly submitting fraudulent documents in hundreds of foreclosure cases across the state.
The lawsuit, filed Wednesday in Lucas County, comes after Ally halted foreclosures last week in Ohio and the 22 other U.S. states that require judicial approval of the process. The move came after it was revealed that some bank employees had signed foreclosure affidavits without verifying that the documents were accurate, a process now known as "robo-signing."
Ohio sues GMAC Mortgage, Ally Financial over foreclosures
By Stephanie Armour, USA TODAY
Ohio Attorney General Richard Cordray Wednesday filed a civil lawsuit against GMAC Mortgage and its parent, Ally Financial, alleging they used fraudulent affidavits and documents to mislead courts in hundreds of home foreclosures in the state.
Calling it a "grave situation," Cordray said Ally Financial's actions raise questions about the legitimacy of foreclosures in Ohio and 22 other states. He said the concerns extend to the practices of other major servicers across the country. Cordray's lawsuit, filed in state court, also seeks a court order barring GMAC from proceeding with foreclosures in the state.
GMAC, JPMorgan Chase and Bank of America have recently suspended foreclosures in 23 states, including Ohio, where seizing homes requires court approval.
Wells Fargo pays $24M to end deceptive mortgage practices probe
By Alan Zibel, Associated Press
WASHINGTON - Wells Fargo (WFC) has agreed to pay $24 million to end an investigation by eight states probing whether the company made risky mortgages to consumers without disclosing their perils.
Housing crisis a lift for rentals Vacancy rates are down and landlords are charging more as homeownership falls.
By Alejandro Lazo, Los Angeles Times
In a sign that the nation's foreclosure crisis is taking a toll, renters surged into the U.S. apartment market in the third quarter, pushing up rents and driving down vacancies.
The national vacancy rate fell to 7.2% in the third quarter from 7.8% the second quarter, one of the sharpest drops on record, according to New York-based real estate research firm Reis Inc. Rents increased 0.6% to an average of $980 a unit over the same period as landlords were able to cut back on free rent and other incentives that had been used to attract and retain tenants in a weak market.
General Motors to Build New Compact Sedan for Buick
By DAVID SCHEPP - DailyFinance.com
Buick still struggles with a brand image that seems more senior than youthful. But the General Motors division will take another step to reverse that stigma in 2012 when it begins selling a new compact sedan, according to news reports.
Based on the recently introduced Chevrolet Cruze compact car, built in Lordstown, Ohio, the new Buick Verano will be assembled at a former Pontiac plant in Orion Township, Mich., GM is expected to announce Thursday.
Companies in U.S. Unexpectedly Cut 39,000 Jobs in September, ADP Says
By Timothy R. Homan
Oct. 6 (Bloomberg) -- Companies in the U.S. unexpectedly cut jobs in September, data from a private report based on payrolls showed today.
Employment decreased by 39,000, the biggest drop since January, after a revised 10,000 rise in August, according to figures from ADP Employer Services. The median estimate of 37 economists surveyed by Bloomberg News called for a 20,000 gain. Forecasts ranged from a decline of 44,000 to a 75,000 increase.
McDonald's, 29 other firms get health care coverage waivers
By Drew Armstrong, Bloomberg Business News - USAToday.com
Nearly a million workers won't get a consumer protection in the U.S. health reform law meant to cap insurance costs because the government exempted their employers.
Thirty companies and organizations, including McDonald's (MCD) and Jack in the Box (JACK), won't be required to raise the minimum annual benefit included in low-cost health plans, which are often used to cover part-time or low-wage employees.
The Department of Health and Human Services, which provided a list of exemptions, said it granted waivers in late September so workers with such plans wouldn't lose coverage from employers who might choose instead to drop health insurance altogether.
Electronic medical records: great, but not very private
By Shelley DuBois - CNNMoney.com Texas is selling your medical records
FORTUNE -- If you live in Texas, your medical records are definitely up for sale by the state. If you live anywhere else in the United States, they probably are for sale there, too.
Medical health records provide key information to researchers, who have lobbied hard to keep them accessible, despite government concerns about the privacy of patient data. The controversy dates back to 1996, when Congress passed the Health Insurance Portability and Accountability Act (HIPAA) to protect patients. "Researchers have very broad access rights to health care records under HIPAA," says Pam Dixon, director of a non-profit called the World Privacy Forum "The rules are pretty loose, and there are a lot of ways to get around them." That's especially true since the act wasn't designed to cover common scenarios today: records stored online in a vast, hackable cloud. In the rush to digitize all electronic health records, Dixon says not everyone is taking the proper steps to de-personalize the data and protect patients.
Food Stamps Went to Record 41.8 Million in July
By Alan Bjerga
Oct. 5 (Bloomberg) -- The number of Americans receiving food stamps rose to a record 41.8 million in July as the jobless rate hovered near a 27-year high, the government said.
Recipients of Supplemental Nutrition Assistance Program subsidies for food purchases jumped 18 percent from a year earlier and increased 1.4 percent from June, the U.S. Department of Agriculture said today in a statement on its website. Participation has set records for 20 straight months.
Communists and Red Hand Clappers: A Report from the Progressive Rally
Socialism item by Cliff Kincaid - Oct 5, 2010
Various communist and socialist groups were photographed and filmed during the October 2 "One Nation Working Together" rally in Washington, D.C. But groups can show up at any event they want to and there is not much that organizers can do about it. The real controversy lies in whether they were officially invited to participate. In this context, the involvement of the Communist Party USA, a group that served as a subversive pawn of Moscow for decades, is relevant and newsworthy.
Since the Obama organization known as "Organizing for America" urged its supporters to attend the rally, this should prompt questions to the White House. But it's doubtful the media will utter a peep.
Apple Readies Verizon iPhone
Apple Inc. is making a version of its iPhone that Verizon Wireless will sell early next year, according to people familiar with the matter, ending an exclusive deal with AT&T and sharpening the competition with Google Inc.-based phones.
While Apple is on track to sell 40 million iPhones across the globe this year, the touchscreen handset is facing pressure in the U.S. from phones running Google's Android software, which have been heavily promoted by Verizon Wireless, the biggest U.S. carrier by subscribers.
Apple plans to begin mass producing the new iPhone by the end of the year, and it would be released in the first quarter of 2011, these people said. The phone would resemble the iPhone 4 currently sold by AT&T, but would be based on an alternative wireless technology used by Verizon, these people said.
Coldest winter in 1,000 years on its way RT
After the record heat wave this summer, Russia's weather seems to have acquired a taste for the extreme.
Forecasters say this winter could be the coldest Europe has seen in the last 1,000 years.
The change is reportedly connected with the speed of the Gulf Stream, which has shrunk in half in just the last couple of years. Polish scientists say that it means the stream will not be able to compensate for the cold from the Arctic winds. According to them, when the stream is completely stopped, a new Ice Age will begin in Europe.
Dr Deagle Show 101005 1/3 - ROBERT FELIX
more on this year's coldest winter (in Europe) and coming ice age
Dr Deagle Show 101005 2/3 - ROBERT FELIX
Dr Deagle Show 101005 3/3 - ROBERT FELIX
DOJ Urges Citizens to Report "Extremists" Handing Out Literature
Kurt Nimmo - Infowars.com
If you posted an Obama Joker poster or Tea Party literature on a public bulletin board, the Justice Department is warning you are a possible terrorist.
According to a hand-out distributed by the Bureau of Justice Assistance, a component of the Justice Department, "extremist literature distributed at the mall or posted on public bulletin boards" is suspicious and a potential indicator of terrorist activities.
In other words, anybody who posted an Infowars.com poster near a mall should be reported to the authorities as a possible domestic terrorist.
H.R. 6109:New Bill Requires Asking Children to Declare their Sexual Orientation - By Marti Oakley - PPJGazette
Will someone please shut off the lights and close the door on Wisconsin? If their legislators aren't trying to figure out ways to harass and torment the agricultural sector, Herb Kohl keeps them busy trying to find ways to sell the whole state off to corporations. Now comes this:
Rep. Tammy Baldwin, believes that children should declare their sexual orientation if they access public education, or any of the vaccination programs or other activities provided by "public education". All of those programs on vaccines alone are enough to pull your kids out of public schools. It is no one's business what the sexual orientation of another person is, was or might be. It is surely none of the school's business. School is for education, not for singling out those who might be different. Maybe if we concentrated on actually educating the children rather than poking our government noses into something we have no business in, we might get kids graduating who could actually make change for a dollar and read beyond a 5th grade level!
Censored Gulf news; La elected officials under US military dictatorship
Deborah Dupré - Human Rights Examiner.com
.... Billy Nungessser, the beloved Plaquemines Parish president, was recently featured in news reports for his outrage and confusion over officials lying and manipulating typically found in a military dictatorship. As AC Griffith has explained, this is intentional. The lack of communication an falsifications are by design and will result in a militarized Agenda 21. (See: Censored Gulf news: State-sponsored terrorism targets Deep South for Agenda 21 (Pt1))
The Coast Guard is lying and its relationships with locals like Nungesser have become so strained, elected officials recently took the same route Kimberly Wolf took at the first presidential Gulf oil spill investigative meeting in New Orleans when she arose to leave after hearing the same lies. Unlike Wolf, however, the elected officials were not escorted out of their meeting last month.
BP and Coast Guard are lying & relationships becoming strained according to local officials
Intelligence leaks anger Obama; sharing rethought
By Eli Lake - The Washington Times
President Obama is angry over recent public disclosures of classified information in Washington and the intelligence community is re-evaluating the post-Sept. 11 push for greater intelligence-sharing, Director of National IntelligenceJames Clapper said Wednesday.
"We are working on information-sharing initiatives across the board," Mr. Clapper said in a speech. "But the classic dilemma of need to share versus need to know is still with us. And I would observe that the Wikileaks episode represents what I would consider a big yellow flag. I think it is going to have a very chilling effect on the need to share."
Real Estate Collapse Spells Havoc in Dubai
By LIZ ALDERMAN - NYTimes.com Canceling Dubai Property Deals Nearly Impossible
DUBAI - On a sultry June evening in 2007, more than 100 people camped out at the offices of Emaar, a prestigious Dubai property developer, to ensure that they would land a coveted spot in a gleaming new skyscraper scheduled for opening this year near the Burj Khalifa, the world's tallest building.
Today, the property, designed by the New York architect Frank Williams, who died this year, is, like a number of others around Dubai, little more than a rotting foundation. Its value has plunged by more than 40 percent since 2008, after the collapse of Dubai's real estate boom.
11 Long-Term Trends That Are Absolutely Destroying The U.S. Economy
The U.S. economy is being slowly but surely destroyed and many Americans have no idea that it is happening. That is at least partially due to the fact that most financial news is entirely focused on the short-term. Whenever a key economic statistic goes up the financial markets surge and analysts rejoice. Whenever a key economic statistic goes down the financial markets decline and analysts speak of the potential for a "double-dip" recession. You could literally get whiplash as you watch the financial ping pong ball bounce back and forth between good news and bad news. But focusing on short-term statistics is not the correct way to analyze the U.S. economy. It is the long-term trends that reveal the truth. The reality is that there are certain underlying foundational problems that are destroying the U.S. economy a little bit more every single day
Middle Class to Suffer Most From Bank Rules: Whitney
By: Jeff Cox - CNBC.com Staff Writer
As new regulations push banks toward safer investments and lending practices, the middle class will suffer the most, banking analyst Meredith Whitney told CNBC.
The 26 percent of mostly low-income Americans who don't have bank accounts - as well as the wealthy - are only marginally affected by tighter credit from more stringent banking regulations, Whitney said.
But those in the middle class who have relied on access to credit will suffer as banks that "can't price risk now" become increasingly afraid to make loans.
One Out Of Every Six U.S. Taxpayers Will Be Hit By A Tax Increase Averaging $3,900 This Year And Most Of Them Don't Even Realize It
Did you know that there are two different sets of federal income tax rules in the United States? It's true. Each year, most U.S. taxpayers either pay income tax under the system that most of us are familiar with or they pay the "Alternative Minimum Tax" - whichever amount ends up being greater. For years, the U.S. Congress has passed one year "fixes" that have exempted millions of middle class American families from the Alternative Minimum Tax. This has essentially been a huge tax cut each year for those millions of American families. But this year, the Democrat-controlled Congress has not passed a "patch" for the Alternative Minimum Tax. So now one out of every six U.S. taxpayers is going to be hit by the Alternative Minimum Tax. The taxpayers most likely to be affected are married couples, very large families, home owners and taxpayers in states that have high state and local taxes. The average tax increase that these taxpayers will be facing is going to be approximately $3,900 and most of them have no idea that it is coming. At a time when an increasing number of families is barely getting by, a tax increase of this magnitude is simply going to crush the American Dream for literally millions of families. Talk about a cruel surprise for tens of millions of Americans this upcoming tax season!
2010 list of failed banks
By Bankrate.com - CNBC.com
This list shows the U.S. banks that have failed since the beginning of the year, and is updated weekly.
Most of the banks are acquired, and the cost to the Deposit Insurance Fund, or DIF, which backs up the FDIC's promise to reimburse customers, is listed in the right column.
For more about how the FDIC is handling bank failures, see "FDIC deals with mounting bank failures," and FDIC spokesman David Barr's interview with Bankrate.
To learn more about the FDIC's safety net, read our Special section.
Check out the list of banks that failed in 2009.
Is the Fed playing with fire?
By Chris Isidore
New York (CNNMoney.com) -- The Federal Reserve is about to throw some more fuel on the fire it has been stoking for more than two years.
But the expected move to pump more cash into the system might not do much good at this point, and the economy could get burned in the process.
The central bank has pumped about $2 trillion into the economy since the recession began in September 2008, in a process known as quantitative easing -- massive purchases of financial assets, like mortgages and Treasurys, designed to encourage spending through lower interest rates.
Now, as the Fed prepares for a two day meeting the first week of November, top officials are sending clear signals that more purchases are on the way.
Central Banks Open Spigot Stocks Leap as Japan Launches Bond-Buying, Fed Official Urges More Easing By MEGUMI FUJIKAWA in Tokyo and DAVID WESSEL in Washington - WSJ.com
The developed world's central banks are moving - at varying speeds and intensity - to respond to a weak recovery, reduce the risks of a global deflation and restrain their currencies from rising against those of their trading partners.
On Tuesday, it was the Bank of Japan's move. Anticipating that the U.S. Federal Reserve will resume large-scale purchases of U.S. Treasury bonds and confronted with strong domestic political pressure to spur growth and restrain a rising yen, the Japanese central bank launched a bond-buying program. It said it would spend 5 trillion yen ($60 billion) to buy government bonds, corporate IOUs, real-estate investment trust funds and exchange-traded funds-the latter two a departure from past practice.
Fed, ECB Throwing World Into 'Chaos':Joseph Stiglitz
By: Reuters via CNBC.com
Ultra-loose monetary policies by the U.S. Federal Reserve and the European Central Bank are throwing the world into "chaos" rather than helping the global economic recovery, Nobel Prize-winning economist Joseph Stiglitz said on Tuesday.
A "flood of liquidity" from the Fed and the ECB is bringing instability to foreign-exchange markets, forcing countries such as Japan and Brazil to defend its exporters, Stiglitz told reporters in a conference at Columbia University.
"The irony is that the Fed is creating all this liquidity with the hope that it will revive the American economy," Stiglitz said. "It's doing nothing for the American economy, but it's causing chaos over the rest of the world. It's a very strange policy that they are pursuing."
Bank Risks Grow as Funding Pressures Loom, IMF Says IMF Says Banks May Have to Be Recapitalized as $4 Trillion Debt Comes Due - By Sandrine Rastello
Oct. 5 (Bloomberg) -- Banking risks have increased over the past six months and governments must be ready to recapitalize or restructure some institutions amid "imminent funding pressures," the International Monetary Fund said.
The IMF, while cutting its estimate for global asset writedowns by about 4.3 percent, warned that confidence in the financial industry has not fully returned after the European debt crisis highlighted banks' links to sovereign-debt risk.
Banks' $4 trillion debts are 'Achilles' heel of the economic recovery',
warns IMF More taxpayer support is needed to ensure global financial stability despite the billions already pledged, the International Monetary Fund has warned, as banks remain the "Achilles heel" of the economic recovery.
By Philip Aldrick, Economics Editor - Telegraph.co.uk
Lenders across Europe and the US are facing a $4 trillion refinancing hurdle in the coming 24 months and many still need to recapitalise, the Washington-based organisation said in its Global Financial Stability Report. Governments will have to inject fresh equity into banks - particularly in Spain, Germany and the US - as well as prop up their funding structures by extending emergency support.
12 Ominous Signs For World Financial Markets
Can anyone explain the very strange behavior that we are seeing in world financial markets right now? Corporate insiders are bailing out of the U.S. stock market at a very alarming rate. Investors are moving mountains of money into gold and other commodities. In fact, there is such a rush towards gold that shortages are starting to be reported in some areas. Meanwhile, some very, very unusual option activity has started to show up. In particular, someone is making some incredibly large bets that the S&P 500 is going to absolutely tank during the month of October. Central banks around the world have caught a case of "loose money fever" and are apparently hoping that a new flood of paper money will shock the global economy back to life. Meanwhile, the furor over the foreclosure procedure abuses of the major U.S mortgage companies threatens to bring even more turmoil to the U.S. housing industry.
Warren Buffett says in future Wall Street chiefs should go broke
- and their wives Warren Buffett, the billionaire investor, has hit out at pay practices on Wall Street, attacking the lack of reform despite two years passing since the financial crisis struck.
By Richard Blackden, US Business Editor - Telegraph.co.uk
"People have a propensity to gamble, and it gets made easier and easier for them," Mr Buffett told a conference in Washington DC yesterday. "One of the problems we still have is we have unbalanced incentives for managers of huge financial institutions."
In future, chief executives of banks who need government assistance should "go broke", said Mr Buffett. Their wives "should go broke, too", he added.
The prospect of another round of bank bonuses is likely to inflame public opinion in the US, where the broader economic recovery is flagging.
Keiser Report №83: ... why GOLD is going up & hyperinflation!
Treasury Sees 2010 Deficit at Nearly 10% of U.S. GDP
By Rebecca Christie
Oct. 5 (Bloomberg) -- The U.S. budget deficit for the 2010 fiscal year ended Sept. 30 is likely to be close to 10 percent of gross domestic product, or almost as large as the previous year's shortfall, a Treasury official said.
"We expect this year's deficit to be a similar or slightly lower percentage of GDP," said Mary Miller, assistant secretary for financial markets, in remarks prepared for a conference in New York. She said the economy is unlikely to sink back into a recession, although the recovery will take time.
The worst recession since the Great Depression cut tax revenue while boosting spending, contributing to a deficit of $1.4 trillion in fiscal 2009. Federal Reserve Chairman Ben S. Bernanke yesterday said lawmakers should adopt rules that limit federal spending or debt to put the nation on a more sustainable fiscal path.
The Monetary Breakdown of the West
Mises Daily: by Murray N. Rothbard
To understand the current monetary chaos, it is necessary to trace briefly the international monetary developments of the 20th century, and to see how each set of unsound inflationist interventions has collapsed of its own inherent problems, only to set the stage for another round of interventions. The 20th-century history of the world monetary order can be divided into nine phases. Let us examine each in turn.
Phase I: The Classical Gold Standard, 1815 - 1914
We can look back upon the "classical" gold standard, the Western world of the 19th and early 20th centuries, as the literal and metaphorical Golden Age. With the exception of the troublesome problem of silver, the world was on a gold standard, which meant that each national currency (the dollar, pound, franc, etc.) was merely a name for a certain definite weight of gold. The "dollar," for example, was defined as 1/20 of a gold ounce, the pound sterling as slightly less than 1/4 of a gold ounce, and so on. This meant that the "exchange rates" between the various national currencies were fixed, not because they were arbitrarily controlled by government, but in the same way that one pound of weight is defined as being equal to sixteen ounces.
The Fed is dead, maybe by 2012
A magic metric that predicts America's future
By Paul B. Farrell, MarketWatch
ARROYO GRANDE, Calif. (MarketWatch) - OK, so Nassim Nicholas Taleb, the "Black Swan" author, actually said: "The Fed won't exist in 25 years." Warning: It'll happen much sooner, fallout of the coming Second American Revolution.
It's inevitable: Wall Street banks control the Federal Reserve system , it's their personal piggy bank. They've already done so much damage, yet have more control than ever.
Warning: That's a set-up. They will eventually destroy capitalism, democracy, and the dollar's global reserve-currency status. They will self-destruct before 2035 ... maybe as early as 2012 ... most likely by 2020.
Does the Bundesbank have any Gold in its vaults?
by Max Keiser
Lars Schall: One topic that is widely discussed among gold bugs in Germany is the question where Germany's gold reserves are located at. May I ask you what you believe is meant by the 1.700 tons of gold in the US bullion depositories under such terms like "Custodial Gold" and "Deep Storage Gold"?
James Turk: I believe that the Bundesbank's vaults are empty or nearly so. When Germany accumulated its 3400t of gold reserves in the 1950s and 1960s, most of it was held abroad in the US and UK. This was standard procedure at the time because it avoided the cost of shipping the gold to the Bundesbank. Also, back then gold stored in the Federal Reserve or the Bank of England was considered to be safe because central banks did not lend gold to bullion banks, which for the most part only began in the 1980s.
China Joyfully Bails Out EU?
by Staff Report - The DailyBell
Chinese Premier Wen (left) says Greece emerging from crisis ... Greece is starting to emerge from its severe debt crisis, Chinese Premier Wen Jiabao said on Sunday during a visit to Athens. "It is with joy that we see Greece emerging from the shadow of its debt crisis," Wen told the Greek parliament. "The financial market has started to stabilise, the budget deficit is coming down, investor confidence is increasing and a growth prospect is emerging on the horizon." - Reuters
Dominant Social Theme: As human beings who care so much, we celebrate the resurgence of the Greek economy.
Free-Market Analysis: Joy! That was the word that caught our eye. Premier Wen sat straight up in bed one morning, teary-eyed. He was overwhelmed with joy ... at Greece's recovery! "China," he muttered to no one in particular (he really did), "is prepared, hand in hand with the EU, as passengers in the same boat, to strengthen cooperation ... to confront the financial crisis." ...
Ireland should honour its debts,
says Irish business federation chief Danny McCoy Ireland's business federation has joined foreign creditors in warning that a default by Dublin on the junior debt of Anglo Irish Bank and other lenders guaranteed during the crisis would be a breach of faith.
By Ambrose Evans-Pritchard in Limerick - Telegraph.co.uk
"Ireland should honour its debts if it can," said Danny McCoy, head the Irish Business and Employers Confederation (IBEC).
"The country makes a living taking capital from people and looking after it, and you don't want to get a reputation for carrying out partial defaults," he told The Daily Telegraph.
Ireland's financial services industry is around 9.8pc of GDP, with big players such as Merrill and Citigroup operating from Dublin's 'Canary Dwarf'. But foreign investment is also the lifeblood of the country's manufacturing industry, led by computers and pharmaceuticals.
Max talks about the options pricing volatility formula and the creation of weapons of mass financial destruction
Gold Goes on a Print Run
By ROLFE WINKLER - WSJ.com
Gold may be a barbarous relic, but in barbarous monetary times, relics do well. Economist Steve Keen's spin on the famous John Maynard Keynes quote nicely encapsulates today's gold trade.
The Bank of Japan's decision to beef up asset purchases, which can now include such rock-solid assets as exchange-traded funds and real-estate investment trusts, has gold bulls salivating over what unconventional weapons the Federal Reserve may deploy to rekindle inflation. At $1,338.90 a troy ounce, the metal has risen 22% this year. The huge force of deleveraging central banks must overcome in their quest to reflate economies has fueled expectations of more spectacular monetary pyrotechnics.
Gold May Jump to $2,200, Copper Will Reach Record, Kooi Says
By Yi Tian and Debarati Roy
Oct. 6 (Bloomberg) -- Gold prices may surge 64 percent and copper will jump to the highest level ever as the dollar tumbles, said Mari Kooi, the chief executive officer of Wolf Asset Management International LLC.
The greenback may fall as much as 20 percent in the next eight to 12 months against a basket of currencies including the South Africa rand and the Canadian dollar, said Kooi, who manages $1 billion and is shifting assets into raw-material investments. The decline will send gold as high as $2,200 an ounce, she said yesterday by telephone from London.
The metal climbed to $1,342.90 in New York yesterday, the highest ever, after Federal Reserve Chairman Ben S. Bernanke said the U.S. central bank may buy more debt to spur growth and the dollar dropped to the lowest level since January against a basket of six currencies. Record-low borrowing costs and rising government debt helped bullion prices jump 22 percent this year.
Gold ascent continues after BOJ measures; further gains anticipated
By Allen Sykora of Kitco News
(Kitco News) - Bank of Japan quantitative easing triggered the bull known as gold into making another uphill charge Tuesday, with traders and analysts looking for $1,350-an-ounce metal in the foreseeable future and higher down the road.
However, some also cautioned about the potential for a temporary correction lower first or at least sideways activity in the next couple of days, should traders pause ahead of key U.S. economic data later in the week that includes the monthly jobs report scheduled for release on Friday.
Global Central Bank Action May Follow BOJ Moves
By Simon Kennedy
Oct. 6 (Bloomberg) -- The Bank of Japan may have acted first in a new round of central bank action to prop up the global economy as recoveries in industrial nations falter.
The unexpected decision by the Japanese central bank yesterday to drop its interest rate to "virtually zero" and expand its balance sheet follows the U.S. Federal Reserve's move toward more unconventional easing. Bank of England officials will consider further stimulus tomorrow, while the central banks of Australia, Canada and New Zealand are among those now holding fire on further interest-rate increases.
Asia Climbs, Gold at Record
By COLIN NG - WSJ.com
SINGAPORE -- Asian stock markets posted solid gains Wednesday, riding Wall Street's coattails with Australian gold miners surging as the yellow metal hit a new record high.
Australia's S&P/ASX 200 was 1.4% higher at 4,670.0, Japan's Nikkei Stock Average was up 0.8%, South Korea's Kospi Composite was up 0.9% at 1,895.20 and New Zealand's NZX-50 was 0.7% higher. Dow Jones Industrial Average futures were up 14 points in screen trade.
Gold Extends Rally to Record as Dollar Sags, Japan Cuts Rate
By Pham-Duy Nguyen and Nicholas Larkin
Oct. 5 (Bloomberg) -- Gold futures jumped to a record $1,342.60 an ounce as the dollar sagged, boosting demand for precious metals as alternative assets. Silver advanced to a 30- year high.
The greenback fell to the lowest level since January against a basket of six currencies. Federal Reserve Chairman Ben S. Bernanke said yesterday the U.S. central bank may buy more debt to help the economy. The Bank of Japan today pledged to keep its benchmark interest rate at "virtually zero" percent. Since Sept. 14, gold has risen to a record in 12 sessions.
If you want sizzling commodities, Dollar should fizzle
By Renisha Chainani - CommodityOnline.com
The Index driving all asset classes and particularly commodities is Dollar. Dollar Index listed on ICE is considered as benchmark. It is trading at 8 month low below 79 (down 5.3% in September and 8.5% in third quarter-2010). This has led rally in commodities, particularly in Bullion. Dollar fell in September because FED hinted that they are ready to inject more cash into economy through Quantative Easing-II measures as early as November.
QE is considered corrosive for currency value. FED also indicated that they will keep Interest Rate low for extended period. The simple issue is this: more quantitative easing in the U.S. means lower U.S. yields and a less attractive dollar as far as international investors are concerned. The news is good for bullion investors because it means there could be more dollars chasing a finite amount of resources, further devaluing the U.S. dollar.
Gold might meet dollar challenge Dollar has already slumped 12% since June
NEW YORK (MarketWatch) - The long-term prospects for gold, the ultimate alternative to weakening currencies, are brighter than ever: Given a deflationary environment and risks to growth, central banks want to provide more liquidity and currency wars are intensifying by the minute.
There are some short-term risks to gold, however: Namely, the dollar, which has already fallen rapidly since June and could snap back against other major currencies. That's sometimes what happens when everyone tries to lower their currencies at the same time.
On Tuesday, the Bank of Japan surprised markets by cutting its lending rate and the Reserve Bank of Australia held back on hiking rates.
Dollar droops as Fed official backs easing
by Colin Barr - Fortune.CNN.com
The dollar sank to a nine-month low Friday after a top Fed official made the case for more monetary stimulus.
William Dudley, the president of the Federal Reserve Bank of New York and a voting member of the Federal Open Market Committee, said in a speech in New York that he believes "further action is likely to be warranted" unless economic activity promptly picks up.
Dudley said the current rates of unemployment, at 9.6%, and inflation, at 1.5%, are "unacceptable." He said the Fed must take action to prevent overindebted households from taking another hit and further slowing the economy.
Dollar Touches 8-Month Low Versus Euro on Fed Policy Outlook
By Yasuhiko Seki and Ron Harui
Oct. 6 (Bloomberg) -- The dollar touched an eight-month low versus the euro on speculation the Federal Reserve will join the Bank of Japan in increasing purchases of government debt.
The Dollar Index fell to levels last seen in January before reports this week forecast to show applications for U.S. unemployment benefits rose and the jobless rate climbed. South Korea's won rose to a five-month high on prospects that the Asian nation's yield advantage over U.S. assets will widen.
"Underlying negative sentiment toward the dollar remains intact due to lingering prospects for additional easing in the U.S.," said Naoto Minatogawa, a currency analyst in Tokyo at Himawari Securities Inc.
Oil hits 5-month peak on dollar, French strike
By Robert Gibbons - Reuters.com
(Reuters) - Oil prices hit a five-month peak near $83 a barrel on Tuesday, boosted by a slumping dollar after a Bank of Japan rate cut and by tanker disruptions because of a French strike and a closed Texan shipping route.
The BOJ pledged to pump more funds into the economy and keep interest rates near zero, pressuring the dollar and boosting equities on expectations other central banks will also act to stimulate their economies.
Bernanke flies with deficit hawks
By Ben Rooney, staff reporter Bernanke: We're on an 'unsustainable path'
NEW YORK (CNNMoney.com) -- Ben Bernanke, chairman of the Federal Reserve, warned Monday that the United States faces serious long-term fiscal challenges that could threaten the nation's economic future.
In prepared remarks from a speech to policy analysts in Rhode Island, the central bank chief said the U.S. budget deficit should narrow over the next few years as the financial markets improve. But he said policymakers will need to make some difficult choices now to put the nation back on a path toward long-term fiscal sustainability.
Fed Official Issues Call for Aggressive Action Chicago President Evans Proposes Raising Inflation Target Above 2% in Effort to Revive the Economy
By JON HILSENRATH -WSJ.com
CHICAGO - Charles Evans, president of the Federal Reserve Bank of Chicago, called for the Fed to do more to charge up the economy, including a new program of U.S. Treasury bond purchases and possibly a declaration that it wants inflation to rise for a time beyond its informal 2% target.
"In the last several months I've stared at our unemployment forecast and come to the conclusion that it's just not coming down nearly as quickly as it should," Mr. Evans said Monday in an interview with The Wall Street Journal. "This is a far grimmer forecast than we ought to have," he added. As result, he said, he favors "much more [monetary] accommodation than we've put in place.
Insider Trading and Central Banks
by Staff Report - the Daily Bell
Are former Fed officials gaining access to secret information? ... In its story about the problem of former Federal Reserve officials gaining access to secret market-moving information at the central bank, Reuters has found a really good solution: Ben Bernanke should come out and give a press conference after each meeting of the Federal Open Markets Committee, which sets monetary policy. The European Central Bank holds a press conference after its key meetings that gives its president, Jean-Claude Trichet, a chance to explain the reasoning behind its actions in a public forum. "If Bernanke can't stop the leaks he ought to have a full press conference after the meeting. It's inappropriate for certain people to gain an advantage on information from the Fed," said Ernest Patrikis, a former No. 2 official at the Federal Reserve Bank of New York and now a partner at law firm White & Case. The story notes how some former Fed officials, like former Fed governor Larry Meyer, are talking to people at the Fed about the confidential internal discussions leading up policy decisions. Then, Meyer and other former Fed officials (and other people who haven't worked at the central bank but are close to its officials) write notes to their clients summarizing what they found out. For this, they get paid millions. - Market Watch Dominant Social Theme: If you know too much, sit down!
Insider Selling To Buying: 2,341 To 1
by Tyler Durden - ZeroHedge.com
Sorry kids, we just report the news... as ugly as they may be. After last week saw an insider selling to buying ratio of 1,411 to 1, this week the ratio has nearly doubled, hitting a ridiculous 2,341 to 1. And while Wall Street's liars and CNBC's clowns will have you throw all your money into "leading" techs like Oracle and Google, insiders in these names sold a combined $200 million in stock in the last week alone (following Oracle insider sales of $223 million in the prior week). Insiders can. not. wait. to. get. out. fast. enough. This Fed-induced rally is nothing short of a godsend for each and every corporate executive. But yes, there may be value: there was insider buying in 2 (two) companies last week: General Dynamics and Best Buy, for a whopping total of $177,064. At the same time sales were a total of $414 million: so is anyone wondering why JPMorgan is reopening its gold vault... Anyone left holding the bag on this market when the FRBNY props are taken away, will be left with the same return as all those investors who entrusted their money with Madoff. Guaranteed.
Rogue French Trader Sentenced to 3 Years
Kerviel Is Ordered to Repay Société Générale $6.7 Billion
By DAVID GAUTHIER-VILLARS - WSJ.com
PARIS - A French court sentenced former Société Générale trader Jérôme Kerviel to three years in prison for his role in one of the world's biggest-ever trading scandals and ordered him to repay his former employer €4.9 billion ($6.71 billion) - a sum it would take him 180,000 years to pay at his current salary.
Mr. Kerviel's lawyer announced he is filing an appeal that will likely take another 18 months to work through the courts. Société Générale's attorney said the bank would not actually expect the former trader - who now works for a computer-consulting firm - to reimburse the money or force him to give up his current paycheck or home.
Still, the ruling is a welcome development for France's second-largest bank, as it lays the entire blame of the 2008 trading debacle on Mr. Kerviel. For years, the low-level trader managed to hide risky trading, at one time making an unauthorized bet of €50 billion.
Feldstein Says Home Prices May Fall Again Without U.S. Aid
By Steve Matthews and Margaret Brennan
Oct. 5 (Bloomberg) -- U.S. home prices may fall again unless the government provides new aid that would enable owners to refinance mortgages, Harvard University economics professor Martin Feldstein said.
"The danger is house prices are going to start falling again because of the end of the first-time homebuyer credit," Feldstein said in an interview on Bloomberg Television's "InBusiness With Margaret Brennan." "That fall in house prices," coupled with a lack of equity in homes, "could lead to a big increase in defaults and foreclosures, putting more homes on the market driving prices down."
Senator demands mortgage lenders reveal foreclosure errors
By Alan Zibel, Associated Press
WASHINGTON - A key lawmaker is demanding that more than 100 mortgage companies determine whether foreclosure documents they approved contain errors and reveal their findings.
Sen. Robert Menendez, D.-N.J., sent letters Tuesday to three banks that have halted foreclosures in 23 states after evidence surfaced that their employees or outside lawyers signed documents without reading them. Menendez leads a Senate subcommittee that oversees housing issues.
He wrote to the three major lenders that have halted thousands of foreclosures - JPMorgan Chase, Bank of America and Ally Financial - along with dozens of other companies.
New FHA MIP in Effect; Foreclosure Mess Impacts Title Companies;
Wells Stops Short Sale Extensions; Servicers Review Processes
by Rob Chrisman - MortgageNewsDaily.com
Today is the big day for the FHA mortgage insurance premium change, and the day that MI companies have been waiting for. Investors from big to small, correspondent to wholesale to retail, have all alerted their clients that FHA's upfront mortgage insurance premium will be adjusted down to 100 basis points on all amortization terms and the annual mortgage insurance premium will increase to 85-90 basis points on amortization terms greater than 15 years.
A fee to pay your bill? Yep Mortgage lenders and utility providers are charging customers as much as $20 to pay by phone.
By David Lazarus - LATimes.com
The credit card reform law now prohibits lenders from charging a fee for paying your bill by phone, particularly if you use an automated system. But apparently the same doesn't apply to mortgage payments.
Such practices - let's call them pay-to-pay - are a particularly obnoxious example of ways some businesses reach deeper into customers' pockets with unwarranted or overblown fees.
Retailers' Holiday Hinges on Discounts
By ELIZABETH HOLMES
Forecasters expect a better holiday season for U.S. retailers, but say the price will be more discounts to get consumers shopping.
The National Retail Federation expects holiday sales to rise 2.3% over last year to $447.1 billion, the biggest increase in three years, in part because of more aggressive pricing strategies. The tone was set by the discount-driven back-to-school shopping season, which wrapped up in September with strong sales of children's and teen clothing, according to MasterCard Inc.'s SpendingPulse unit that tracks payment by cash, check and credit card.
"We expect a very, very competitive and aggressive Christmas and holiday selling season, price-focused," Bill Simon, chief executive of Wal-Mart Stores Inc.'s U.S. business, said at a recent conference.
Grocer leaves Detroit landlords holding the bag New Jersey-based The Great Atlantic & Pacific Tea Co., which aims to close dozens of stores in New York, triggered 24 lawsuits when it suddenly stopped paying rent in Detroit.
By Daniel Duggan, CrainsDetroit.com
More trouble is afoot for The Great Atlantic & Pacific Tea Co. The Montvale, N.J.-based grocer owes nearly $150 million in unpaid rent in Detroit, after stopping payments on nearly 2 million square feet of retail and industrial space in the area and triggering 24 lawsuits.
A&P acquired Detroit's Farmer Jack chain in 1989. Three years ago, A&P decided to leave Detroit, vacating 66 stores. Kroger Co. bought or leased 20, and several others have been leased or subleased. There are 27 stores remaining under long-term leases, with some running beyond 2020, according to a list of stores the company released in 2007. Leases are in the name of Borman's Inc., the Farmer Jack parent company prior to A&P.
Amid backlash and budget deficits,
government workers' pensions are targets
By Michael A. Fletcher - Washington Post
PHILADELPHIA - Faced with deep budget deficits and overextended pension plans, state and local leaders are increasingly looking to trim the lucrative retirement benefits that have long been associated with government employment.
Public employees are facing a backlash that has intensified with the nation's economic woes, union leaders say, because of their good job security, generous health-care and pension benefits, and right to retire long before most private-sector workers.
In California, where an estimated 80 cents out of every government dollar goes to employee pay and benefits, Gov. Arnold Schwarzenegger (R) has proposed a two-tier system of pensions that offers new state workers reduced benefits with tighter retirement formulas. He also wants state workers to kick in higher pension contributions to help deal with California's staggering deficit.
The costs of rising economic inequality
By Steven Pearlstein - Washington Post
Although much of the Republicans'"Pledge to America" is given over to a discussion of economic issues, there is one topic that is never mentioned: the dramatic rise in income inequality. As with global warming, Republicans seem to have decided that the best way to deal with this fundamental challenge is to deny it exists.
If you asked Americans how much of the nation's pretax income goes to the top 10 percent of households, it is unlikely they would come anywhere close to 50 percent, which is where it was just before the bubble burst in 2007. That's according to groundbreaking research by economists Thomas Piketty, of the Paris School of Economics, and Emmanuel Saez, of the University of California at Berkeley, who last week won one of this year's MacArthur Foundation "genius" grants.
Unemployed? Get a federal loan to pay your mortgage
By Tami Luhby
NEW YORK (CNNMoney.com) -- Unemployed and can't pay your mortgage?
You can soon apply for a no-interest government loan for up to $50,000 to pay your mortgage and cover your arrears. The loan, which can offer assistance for up to two years, will be forgiven if the homeowner stays in the house for five years.
Troubled borrowers will be able to apply for the Emergency Homeowners Loan Program by the end of the year. They must be at least three months behind in their payments, but have a reasonable likelihood of being able to resume payments within two years. And they must have suffered at least a 15% drop in income, but have been able to afford their mortgage before their income loss.
Trying to Make Sense of the Mortgage Foreclosure Fiasco
by Tom Lawler - CalculatedRisk
Since the GMAC "robo-signer" issue first "broke" last month, the "issue" has catapulted from what some (but not all) industry folks characterized as a "technical" issue in judicial foreclosure states to what the media (who predictably jumped on this story like a ... well, I can't print that!) now characterizes as a "gigantic mess." Not too long after the GMAC story came out, both Chase and Bank of America announced that they too were suspending foreclosures in the 23 "judicial" foreclosure states, and while some other big servicers (Wells and Citi) weren't planning to suspend foreclosures, news reports surfaced suggesting that both companies had some "robo-signers" as well. The media, of course, then searched for individual cases of "foreclosures gone wild," and found a number of instances where there were some real mistakes made by lenders/servicers that went well beyond "robo-signing."
Foreclosures taking toll on more city school kids Study says nearly 20,000 students lived in homes facing foreclosure in the 2006/2007 school year; often-ignored victims.
By Amanda Fung - Crain's NY Business
A report released Monday morning highlights the increasingly negative impact - which has long been overlooked - that foreclosures are having on New York City school children.
In the 2006-2007 academic year, there were 18,525 school children from grades K-12 in homes facing foreclosure, up 59% from the 2003-2004 academic year, according to the report, which is titled Kids and Foreclosures: New York City, by New York University's Institute for Education and Social Policy and NYU's Furman Center for Real Estate and Urban Policy. Not surprisingly, affected students are concentrated in schools located in two of the neighborhoods hardest hit by the foreclosure crisis - southeast Queens and northern Brooklyn.
Push to halt foreclosures gains steam
By Ben Rooney
NEW YORK (CNNMoney.com) -- Pressure is mounting on U.S. banks to halt more foreclosures amid widespread allegations that loan servicers failed to verify legal documents in what could be hundreds of thousands of cases.
Members of Congress from California wrote to the heads of the Justice Department, the Federal Reserve, and the Comptroller of the Currency on Tuesday, requesting that they investigate the foreclosure processes of banks under their purview for "possible violations of law or regulations."
Foreclosure Furor Rises; Many Call for a Freeze
By DAVID STREITFELD and GRETCHEN MORGENSON - NYTimes.com
The uproar over bad conduct by mortgage lenders intensified Tuesday, as lawmakers in Washington requested a federal investigation and the attorney general in Texas joined a chorus of state law enforcement figures calling for freezes on all foreclosures.
Representative Nancy Pelosi, the House speaker, and 30 other Democratic representatives from California told the Justice Department, the Federal Reserve and the comptroller of the currency that "it is time that banks are held accountable for their practices."
Feds Fail to Prove Taxpayer "Willfully" Failed to Fil
Foreign Account Report
Mark Nestmann - SovereignSociety.com
For the last year, the IRS has been "on a roll." During that time, it's penetrated a centuries-old tradition of bank secrecy in Switzerland. It's forced Switzerland's largest bank, UBS, to disclose account details on more than 4,000 U.S. taxpayers. And it's concluded a "voluntary disclosure" program that resulted in nearly 15,000 U.S. taxpayers coming forward to admit they failed to disclose details of their offshore holdings.
But in the face of this juggernaut, it's important to get "back to basics." What legal basis does the IRS have to impose a penalty for a mere failure to acknowledge a foreign account?
Can financially-strapped cities default on municipal bonds? Q: Can states or cities go bankrupt and cause them to default on municipal bonds and stop paying interest? A: It's extremely uncommon for cities and states to get so strapped financially that their payments on municipal bonds would be in danger. But it does happen.
Most recently, Harrisburg, Pa,. sidestepped defaulting on a $3.3 million general municipal bond, but only due to the $4.4 million in emergency funds and other money it received from the state. The city remains in bad financial shape as it runs up more deficits and struggles.
This Is Starting To Get Very Real:
Agricultural Commodity Prices Have Exploded And Now The Price Of Food Is Beginning To Rise Substantially In The United States And All Over The World
Do you believe that you will always be able to run out to Wal-Mart or to the local supermarket and buy massive amounts of inexpensive food? If so, you might want to think again. During 2010, agricultural commodity prices have absolutely exploded. Nearly every single important agricultural commodity has seen a double digit percentage price increase. In fact, the S&P GSCI Agriculture Index recently surged to a fresh two year high. Now food producers and retailers are starting to pass those commodity price increases on to consumers. Today when I went to the supermarket I was absolutely startled by some of the price increases that I witnessed. On some of the items that I most commonly purchase, prices were up 20 or 30 percent. So just what in the world is going on here? Well, it turns out that there was a lot of bad weather around the world this year, so many harvests were worse than projected. In addition, the growing population of the world has an increasingly voracious appetite for food. When supply gets tighter as demand continues to go up that means that prices are going to increase.
199 L.A. County workers made at least $250,000 last year The list comprises mostly medical personnel and department heads, but also includes firefighters, the sheriff and district attorney. Thirty employees made more than $80,000 in overtime.
By Rong-Gong Lin II, Los Angeles Times
Nearly 200 Los Angeles County employees earned more than a quarter of a million dollars in 2009, according to a list of the county's top earners released late Monday in response to a Public Records Act request from The Times.
The highest earners list was dominated by physicians and other medical personnel, but also included county firefighters and a handful of top sheriff's employees. Some of the best-known names on the list belong to elected officials - although none of the five county supervisors, who make $178,789 a year, qualified.
Forty percent of U.S. workers delay retirement
(Reuters Life!) - Forty percent of U.S. workers are planning to delay their retirement due to concerns about outliving their savings and fears of rising healthcare costs, according to a survey released Tuesday by consultants Towers Watson.
Fifty-nine percent of workers who plan to delay their retirement cited the need to keep their healthcare coverage as a reason, while 56 percent also blamed the decline in the value of their employer-sponsored retirement plan.
The majority of workers who plan to delay retirement expect they will have to work for at least three years more than originally planned.
Social Security: No 2011 increase expected
By Jeanne Sahadi
NEW YORK (CNNMoney.com) -- Chances are high that for the second year in a row Social Security beneficiaries will see no increase in their benefit checks.
The official word won't come until mid-October when the Social Security Administration announces whether there will be a cost-of-living adjustment (COLA) for 2011. But those who've crunched the numbers say there just hasn't been enough inflation to justify a bump in benefits
The last time there was an inflation adjustment was in 2009: Social Security beneficiaries got a higher-than-normal 5.8% increase because of a temporary spike in energy prices in the third quarter of 2008.
3M to Change Health-Plan Options for Workers
By JANET ADAMY 3M Co. confirmed it would eventually stop offering its health-insurance plan to retirees, citing the federal health overhaul as a factor.
The changes won't start to phase in until 2013. But they show how companies are beginning to respond to the new law, which should make it easier for people in their 50s and early-60s to find affordable policies on their own. While thousands of employers are tapping new funds from the law to keep retiree plans, 3M illustrates that others may not opt to retain such plans over the next few years
The St. Paul, Minn., manufacturing conglomerate notified employees on Friday that it would change retiree benefits both for those who are too young to qualify for Medicare and for those who qualify for the Medicare program. Both groups will get an unspecified health reimbursement instead of having access to a company-sponsored health plan.
Lawsuits over health care law heat up
By Rick Schmitt Kaiser Health News
Matt Sissel of Iowa City proudly served in Iraq as a combat medic. But he objects to being "conscripted" into an overhauled federal health care system.
The uninsured artist is riled about a provision in the new health law that would require him to purchase insurance or pay a penalty starting in 2014. Last July, he filed a lawsuit to have the landmark act declared unconstitutional. "I don't want the federal government dictating my personal financial decisions," says Sissel, 29. "It can't even run its own budget."
The Green Agenda Is About Getting Rid Of As Many Humans As Possible
Most people tend to think of environmentalists as warm, cuddly hippies that just want all of us to love one another and to do what is right for the environment. And in fact, there are a few people out there who are actually like that. However, the people at the very heart of the green agenda are a quite different breed. The truth is that there are a growing number of environmental activists (including some very, very famous people) who are publicly advocating the end of our freedoms, the establishment of a Big Brother style world government and the systematic eradication of at least 90% of humanity all for the good of the environment. Unfortunately, this is not a joke and it is not an exaggeration. As you will see below, these people are very, very serious. To these eco-fascists, climate change is the number one threat to the earth, and in order to eliminate that threat "democracy must be put on hold", an authoritarian world government must be established and we need to start getting rid of as many humans as possible.
Retirement funds tapped for kids' tuition
By Jennifer Liberto, CNN.com
WASHINGTON (CNNMoney.com) -- Nearly a quarter of the nation's parents saving for their children's college education intend to raid their own retirement accounts, despite increasing their tax liability, according to a new study released Tuesday.
The results of the survey, conducted by student loan provider Sallie Mae and the Gallup organization, surprised personal finance experts - especially considering other options, such as 529 college savings plans, that can grow and be spent on college education tax free.
Colorado Senate race ranks first nationally in attracting outside money
By Allison Sherry - The Denver Post
Colorado's U.S. Senate race ranks first in the country for attracting outside money - most of it paying for ads against GOP Senate hopeful Ken Buck and his Democratic opponent, incumbent Sen. Michael Bennet.
Since Aug. 10, $6.5 million has been piped through both recognizable and vague-sounding interest groups peddling - or in most cases trashing - Buck and Bennet on television commercials and in mailers, according to the Sunlight Foundation.
The outside money dwarfs the approximately $3 million the campaigns have spent on ads for the general election. Bennet has spent just under $2 million, and Buck has spent about $1.1 million.
All of this isn't particularly unusual, but what is raising eyebrows nationally this year is the number of innocuous-sounding organizations - such as the Americans For Job Security and the Coalition to Protect Seniors - with virtually non-traceable donor lists.
Murkowski to stations: Don't air tea party ad
By BECKY BOHRER - The Associated Press
JUNEAU, Alaska -- U.S. Sen. Lisa Murkowski's campaign is warning Alaska broadcasters not to air ads by a national tea party group that the campaign says are "littered with lies and intentional mischaracterizations" about her and her write-in campaign.
Attorney Timothy McKeever, in a letter to broadcasters Monday, said they are under a "legal and moral obligation" not to air the new ads from Tea Party Express, which is supporting Joe Miller, the political upstart who defeated Murkowski in the August GOP primary.
A Tea Party Express spokesman said his initial reaction is that the group stands behind the ads.
*****
A Quiet, Global Revolution
by Staff Report - The DailyBell
America on the brink of a Second Revolution ... "What's distinctive about the Tea Party is its anarchist streak - its antagonism toward any authority, its belligerent self-expression, and its lack of any coherent program or alternative to the policies it condemns," warns Jacob Weisberg in Newsweek. But why not three cheers for the Tea Party Express? - MarketWatch
Dominant Social Theme: A lot is going on. Hard to make sense of it all.
Free-Market Analysis: We would like to think that the Daily Bell offers a comprehensible roadmap to tumultuous times. Over the past years (a decade in fact) the modest braintrust of the Daily Bell has preached that the Internet is sparking a second Renaissance or Reformation, just as the Gutenberg press did originally. We've stuck with this perspective while the mainstream press (and a good part of the alternative media) has pro-offered one suggestion after another to explain modern sociopolitical turbulence. Additional dominant social theme: "There's really no connection between events. It's all kind of random and everyone needs to just calm down."
Europeans see similarities between Islam and Nazism?
Pravda.ru
The trial on Europe's perhaps most controversial politician, Geert Wilders, 47, the leader of Holland's Party for Freedom, started in the country on October 4. The politician became known for his harsh statements about Islam and Muslims.
The politician has been charged with inciting religious strife. Prosecutors presented 70 pages of indictment based on five articles of the Penal Code of the Netherlands. Prosecutors claim that Wilders insulted Muslims when he compared Quran to Adolf Hitler's Mein Kampf and urged to put an end to the "Islamic invasion." If found guilty, the leader of the Party for Freedom will face the term of 12 months in prison and a 10,000-euro fine.
The general public inside and outside Holland shows immense interest in the trial. Some experts say that Wilders will use the court room to promote his ideas, which many in the country consider as extremist.
Wilders stated that the charges brought against him were unfounded because they contradicted to the fundamental principle of Holland and the entire European Union - the freedom of speech.
For those of you who don't understand
By John Frisby - Lux libertas
"Brace yourselves, because the war with Muslims has just begun,"
NEW YORK - The Pakistani immigrant who tried to set off a car bomb in Times Square was sentenced Tuesday to life in prison with no chance of parole, a mandatory penalty that left him defiant as ever and the judge who sentenced him determined to send a message to anyone who might want to follow in his path.
Are Independent Thinkers Mentally Ill?
Mark Nestmann - SovereignSociety.com
Do you question authority? Fail to accept conventional wisdom? Lose your temper when you hear a politician make a promise that you know he or she can't keep?
If so, you may be mentally ill, according to the most recent revision of the Diagnostic and Statistical Manual of Mental Disorders (DSM). In this revision, psychiatrists hope to add dozens of new mental disorders. Unfortunately, many of these so-called illnesses target people who merely think or behave differently from the majority population.
A case in point is "oppositional defiant disorder (ODD)." DSM defines ODD as "an ongoing pattern of disobedient, hostile and defiant behavior toward authority figures." Symptoms include losing one's temper, annoying people and being "touchy." Other "disorders" include antisocial behavior, arrogance, cynicism and narcissism. Sounds like many of my readers!
UFO Promotion Goes Mainstream - Quick Hide!
by Staff Report - The Daily Bell Former Air Force Officers Claim UFOs Visited Bases, Tampered With Nukes ... UFOs They're out there, say a handful of former Air Force officers. The truth is out there, and a group of retired Air Force officers gathered the media and a handful of well-wishers at the National Press Club in Washington, D.C., in an attempt to reveal what they say is a government cover-up of decades of alien contact. The officers claimed, through their own individual accounts, that during the Cold War UFOs visited various USAF installations, but that's just the precursor to a more remarkable assertion: the aliens were tampering with our nukes. Gathered by well-known UFO researcher Robert Hastings, the officers all individually gave similar accounts - that sometime between 1963 and 1980 each was present at nuclear missile sites when unexplained flashing lights appeared in the sky at the same time the missiles went form alert status to non-responsive. In one account, retired targeting officer Robert Jamison said all 10 missiles in his charge - known as a "flight" - went off alert status just as rumors of unidentified lights in the sky overhead swept through the base. Jamison didn't see the UFO himself, but several others on the base witnessed the incident. The cause of his missiles going offline is unknown. - Popular Science Dominant Social Theme: They're out there and soon they'll be in here.
Shultz to Obama: 'You're out of your mind' Former secretary of state blasts Afghan withdrawal date
By Ben Birnbaum - The Washington Times
Reagan-era Secretary of State George Shultz blasted President Obama Monday night for his scheduled July 2011 date to begin withdrawing U.S. forces from Afghanistan.
Mr. Shultz, 89, made the unusually blunt remarks at a packed dinner for the International Republican Institute -- the GOP-aligned counterpart to the National Democratic Institute -- where he was receiving the organization's 2010 Freedom Award.
***** Here she comes, again ...
Obama-Clinton ticket 'on the table,' Woodward says
By: CNN Ticker Producer Alexander Mooney
(CNN) - Some called a Barack Obama-Hillary Clinton pairing the "Dream Ticket" in 2008. It didn't happen.
But what about 2012?
"It's on the table," veteran Washington Post reporter Bob Woodward told CNN's John King in an interview Tuesday on John King, USA. "Some of Hillary Clinton's advisers see it as a real possibility in 2012."
The scenario - whereby Vice President Joe Biden and Secretary of State Hillary Clinton would switch positions - has been bandied about by political observers for months, seen by some as a potentially savvy strategy to gin up excitement among what appears to be a depressed Democratic base.
Arizona's Medicaid Program Will No Longer Cover Liver, Heart, Lung Transplants "Significant fiscal challenges" will eliminate other benefits for adults
By Susan Jones
(CNSNews.com) - Arizona's Medicaid agency will no longer cover non-experimental organ transplants for its adult members, a move blasted as "a death sentence" by one patient advocacy group.
In a memo announcing a number of benefits changes for adults 21 and older, the state's Medicaid agency said it was responding to "significant fiscal challenges facing the State and substantial growth in the Medicaid population."
Wind farms can change the weather
USAToday.com
Large wind farms can influence local air temperatures, according to a new study published today in the Proceedings of the National Academy of Sciences.
The data was collected over seven weeks in the summer of 1989 at the San Gorgonio wind farm near Palm Springs, Calif.
The study revealed that the wind farm caused the local area to cool down during the day and warm up at night, according to authors Somnath Baidya Roy and Justin J. Traiteur of the University of Illinois.
US Warns Lebanon Over Ahmadinejad Visit Iranian President to Visit Next Week
by Jason Ditz - AntiWAr.com
The Obama Administration revealed today that they had issued official "warnings" to the Lebanese government over their decision to allow Iranian President Mahmoud Ahmadinejad to visit the country next week.
"We expressed our concern about it given that Iran, through its associati
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