Weekday NEWS to Comfort the Disturbed and Disturb the Comfortable.
Thursday 05.31.2012
Capital Controls Have No Place in a Free Society
BY RON PAUL - FinancialSense.com
The characteristic mark of a tyrannical regime is that it eventually finds it necessary to erect walls to keep people from leaving. This is why we should be troubled by the "Ex-PATRIOT Act," an egregiously offensive bill recently introduced in the Senate. Following a long line of recent legislation and regulations attempting to expropriate more and more wealth from hard-working Americans, this new bill spits in the face of overburdened taxpayers and tramples on the Constitution.
Alarm bells in the U.S. Alarms are ringing as negative trends come together in a perfect storm. Is the United States sleepwalking into economic and geopolitical decline?
By ARNAUD DE BORCHGRAVE, UPI Editor at Large
WASHINGTON, May 29 (UPI) -- Gen. David Richards, the British chief of staff, in the understatement of the week, says the strategic landscape is "worrying" and the outlook "bleak."
The United States as the world's strongest geopolitical player has become ungovernable, saddled with a dysfunctional Congress. House and Senate together, with 535 members, maintain 250 committees and subcommittees and micromanage muscular government decisions into unworkable policy directives.
No fewer than 108 committees have oversight jurisdiction on Homeland Security.
More reasons why the LME should not fall into Chinese hands Following my piece on Tuesday on the London Metal Exchange, here are some more reasons why selling the LME to China, or any other government for that matter, would be a bad idea.
By Damian Reece - Telegraph.co.uk
China is the world's leading consumer of commodities so gaining influence over the pricing and warehousing of those commodities is crucial to China and owning the LME would deliver that. The advantages to Chinese industry, over rivals, are obvious. It is therefore very surprising that no one in Europe, or the UK, has realised the importance of this putative deal.
The LME doesn't physically own the warehouses but it does regulate them - thus dictating terms to the site owners. The LME is a hugely strategic piece of market infrastructure which should not fall into the hands of any one government. But it is a "must have" asset for China which is bidding for it through the state controlled Hong Kong Exchanges and Clearing. That's why it's willing to pay more than £1bn for it, even though the LME makes only about £10m in profit - a multiple that even Facebook couldn't command in its over priced IPO.
Enter The Swan
by John Aziz - ZeroHedge.com
Charles Hugh Smith (along with many, many, many others) thinks there may be a great decoupling as the world sinks deeper into the mire, and that the dollar could be set to benefit:
This "safe haven" status can be discerned in the strengthening U.S. dollar. Despite a central bank (The Federal Reserve) with an avowed goal of weakening the nation's currency (the U.S. dollar), the USD has been in an long-term uptrend for a year–a trend I have noted many times here, starting in April 2011.
That means a bet in the U.S. bond or stock market is a double bet, as these markets are denominated in U.S. dollars. Even if they go nowhere, the capital invested in them will gain purchasing power as the dollar strengthens.
Europe Is Literally Running Out of Money
By Matthew O'Brien - TheAtlantic.com
Europe has a lot of problems. But none is more pressing than this: The euro zone is running out of money.
The chart below from Scotty Barber shows broad money and private sector loan growth in the euro zone over the past decade. The numbers for the past year are not good. Not good at all.
Economies need money. Without it, businesses and households stop. Just ask Spain. It's further along in the "no money" race than most. Unemployment is 25 percent, credit is drying up, and the government is supposed to cut its deficit an almost unthinkable amount.
Europe Is About to Implode... Are You Ready?
By Graham Summers - ZeroHedge.com
I've warned time and again that the EU would collapse in May-June. That collapse is here right on schedule. And NO ONE will be able to stop it.
Here's why:
1) According to the IMF, European banks as a whole are leveraged at 26 to 1 (this data point is based on reported loans... the real leverage levels are much, much higher.) These are a Lehman Brothers leverage levels.
2) The European Banking system is over $46 trillion in size (nearly 3X total EU GDP).
3) The European Central Bank's (ECB) balance sheet is now nearly $4 trillion in size (larger than Germany's economy and roughly 1/3 the size of the ENTIRE EU's GDP). Aside from the inflationary and systemic risks this poses (the ECB is now leveraged at over 36 to 1).
4) Over a quarter of the ECB's balance sheet is PIIGS' debt which the ECB will dump any and all losses from onto national Central Banks (read: Germany)
European officials propose banking union to ease debt crisis, relieve pressure on Spain
AP - WashigtonPost.com
FRANKFURT, Germany — As Europe's debt crisis intensifies, top officials say the continent urgently needs a central authority with the financial muscle to fix its broken banks.
The proposal could give immediate relief to Spain's increasingly fragile economy, with its borrowing rates rising to unsustainable levels, rattling investors.
Madrid in 'Game of Chicken' With EU
By: Miles Johnson and Patrick Jenkins, Financial Times - CNBC.com
When Mariano Rajoy climbed the victory podium in November, having won the biggest electoral majority in his party's history, he would never have imagined that six months later his country's destiny could be slipping out of his hands.
With yields on sovereign debt rising and the economy falling deeper into recession, the second in three years, the veteran Galician politician is battling harder than at any other time in his short premiership to prove his country can sort out its finances without an international bailout.
EUROPE – HERE WE GO AGAIN The Rise of European Fascism - [see chart]
By James Quinn - TheBurningPlatform.com
Will Fed Printing Press Try to Save Europe?
By Greg Hunter's USAWatchdog.com
You know things are heating up when the banks start with scare tactics. In Greece, the bankers are in full court press to sway voters for next month's election. Reuters reported yesterday, "In a report released ahead of an election on June 17 that may determine whether the country stays in the single currency, the country's biggest bank said the risk of Athens exiting the euro was no longer just a theoretical possibility, warning that the fallout from such a move would be dramatic. 'An exit from the euro would lead to a significant decline in the living standards of Greek citizens,' the NBG wrote ahead of a vote which parties opposed to austerity measures that have kept Greece in the euro so far have a chance of winning." What would you expect from bankers who want the people to keep them in business as debt slaves? There is never any mention of pain for some gain. In Iceland, the people voted not to pay back much of their sour debt and, now, the country is in a real recovery.
Why Spain Is Officially Europe's Biggest Crisis Spain is up next in As The Euro Crisis Turns after it admitted that it can't afford to bail out its banks.
By Matthew O'Brien - TheAtlantic.com
Spain has a problem. It's running out of money.
More precisely, it's running out of euros. It can't print them. It can't borrow them, except at ruinous rates. It's bailout or bust.
But first, a bit of background. Spain was, as Paul Krugman colorfully put it, the Florida of Europe. It had a prodigious housing bubble that has subsequently gone into reverse. But that's where the similarities end. Spain is on its own. Florida isn't. Remember, Florida doesn't pay for its social insurance spending or bank bailouts. The federal government does. Social Security checks keep coming and the FDIC keeps taking over failing banks regardless of the state of Florida's finances. Spain doesn't have that safety net. That's how you get 25 percent overall unemployment and over 50 percent youth unemployment.
Spain faces 'total emergency' as fear grips markets Spain is facing the gravest danger since the end of the Franco dictatorship as the country is frozen out of global capital markets and slides towards an epic showdown with Europe.
By Ambrose Evans-Pritchard - Telegraph.co.uk
"We're in a situation of total emergency, the worst crisis we have ever lived through" said ex-premier Felipe Gonzalez, the country's elder statesman.
The warning came as the yields on Spanish 10-year bonds spiked to 6.7pc, pushing the "risk premium" over German Bunds to a post-euro high of 540 basis points. The IBEX index of stocks in Madrid fell 2.6pc, the lowest since the dotcom bust in 2003.
An Argentine Guide to the Greek Crisis
By Andrés Velasco - Project-Syndicate.us
SANTIAGO – Policymakers in Europe seem to be surprised at the ongoing bank run in Greece (and the nascent run in Spain). They should not be. Anyone familiar with emerging-market meltdowns knows that a financial crisis nearly always follows a fiscal crisis.
Argentina's default in 2001 is but one useful example. In the Argentine crisis, the economy contracted by 18% and unemployment soared to 22% of the labor force. Greece is already close to these levels.
Rothschild and Rockefeller: their family fortunes As a Rothschild trust prepares to buy a stake in the Rockefeller empire, how have these two dynasties managed to hold on to their wealth for so long?
By Harry Mount - Telegraph.co.uk
You know you've really made it when your surname becomes an adjective.
In the late 19th century, the term "Rothschild Tudor" came into use to describe the family's half-timbered estate cottages, sprinkled across their vast landholdings in Buckinghamshire. And in America, for more than 80 years, Rockefeller has been shorthand for "very rich indeed". The name crops up in two classic Thirties Broadway numbers: On the Sunny Side of the Street ("If I never had a cent, I'd be rich as Rockefeller") and the Gershwins' They All Laughed ("…at Rockefeller Centre – now they're fighting to get in").
Rockefellers and Rothschilds unite
By Daniel Schäfer in London - FT.com
Two of the best-known business dynasties in Europe and the US will come together after Lord Jacob Rothschild's listed investment trust and Rockefeller Financial Services agreed to form a strategic partnership.
RIT Capital Partners is to buy a 37 per cent stake in the Rockefeller's wealth advisory and asset management group for an undisclosed sum, giving Lord Rothschild's London-listed trust a much sought-after foothold in the US.
The transatlantic union brings together David Rockefeller, 96, and Lord Rothschild, 76 – two family patriarchs whose personal relationship spans five decades.
Is The End Nigh: Rockefellers And Rothschilds Merge
Submitted by Tyler Durden - ZeroHedge.com
You know its bad when... two of the largest and best-known 'familia' in Europe and the US come together. As the FT reports, The Rockefellers and The Rothschilds are uniting under a common group as Rothschild Investment Trust and Rockefeller Financial Services become one. The patriarchs (David Rockefeller 96, and Lord Rothschild 76) have been 'connected' for five decades. Between the Rothschild's 'sprawling' multi-century banking empire across Europe and the Rockefeller's roots in 1882 Oil-money, we can only imagine the Illuminati, Freemasons, Templars, and Central Bankers of the world are quaking in their boots at this new global force for change - The Rothsellers or is it The Rockchilds. What next? It seems only Soros is left to complete the holy trinity...
How Political Clout Made Banks Too Big to Fail
By Luigi Zingales - Bloomberg.com
The U.S. has historically kept the financial sector in check through a combination of sound principles and serendipitous decisions. But as the financial system gained strength in recent years, it also gained political influence. In the last decade, it has become too concentrated and too powerful, which has damaged not only the economy but the financial sector itself.
How did it happen? In 1933, the Glass-Steagall Act erected a wall between two ways that banks could help customers borrow money. The idea was to keep commercial banks from exploiting their depositors, who might get saddled with the bonds of firms that could not repay the money they owed. One beneficial side effect of the Glass-Steagall Act was to fragment the banking sector and reduce the financial industry's political power. Another was to foster healthy competition between commercial banks and investment banks.
Obama signs reauthorization of Export-Import Bank
despite earlier opposition
By Susan Crabtree - The Washington Times
President Obama on Wednesday reauthorized the Export-Import Bank, raising its lending authority 40 percent to $140 billion by 2014, one day before the 78-year-old federal bank would have been shut down had he not signed the bill.
Increasing the bank's lending power ensures "that we're not just known as a nation that consumes," the president said at a signing ceremony. "We've got to be a nation that produces."
JPMorgan CIO Swaps Pricing Said To Differ From Bank
By Matthew Leising, Mary Childs
and Shannon D. Harrington - Bloomberg.com
The JPMorgan Chase & Co. (JPM) unit responsible for at least $2 billion in losses on credit derivatives was valuing some of its trades at prices that differed from those of its investment bank, according to people familiar with the matter.
The discrepancy between prices used by the chief investment office and JPMorgan's credit-swaps dealer, the biggest in the U.S., may have obscured by hundreds of millions of dollars the magnitude of the loss before it was disclosed May 10, said one of the people, who asked not to be identified because they aren't authorized to discuss the matter.
The Second Act Of The JPM CIO Fiasco Has Arrived -
Mismarking Hundreds Of Billions In Credit Default Swaps
Submitted by Tyler Durden - ZeroHedge.com
As anyone who has ever traded CDS (or any other OTC, non-exchange traded product) knows, when you have a short risk position, unless compliance tells you to and they rarely do as they have no idea what CDS is most of the time, you always mark the EOD price at the offer, and vice versa, on long risk positions, you always use the bid. That way the P&L always looks better. And for portfolios in which the DV01 is in the hundreds of thousands of dollars (or much, much more if your name was Bruno Iksil), marking at either side of an illiquid market can result in tens if not hundreds of millions of unrealistic profits booked in advance, simply to make one's book look better, mostly for year end bonus purposes. Apparently JPM's soon to be fired Bruno Iksil was no stranger to this: as Bloomberg reports, JPM's CIO unit "was valuing some of its trades at prices that differed from those of its investment bank, according to people familiar with the matter. The discrepancy between prices used by the chief investment office and JPMorgan's credit-swaps dealer, the biggest in the U.S., may have obscured by hundreds of millions of dollars the magnitude of the loss before it was disclosed May 10, said one of the people, who asked not to be identified because they aren't authorized to discuss the matter. "I've never run into anything like that," said Sanford C. Bernstein & Co.'s Brad Hintz in New York. "That's why you have a centralized accounting group that's comparing marks" between different parts of the bank "to make sure you don't have any outliers," said the former chief financial officer of Lehman Brothers Holdings Inc."
Rosengren wants more Fed easing; Dudley, Fisher don't
By Corrie MacLaggan and Ros Krasny
(Reuters) - Underscoring the divide at the U.S. Federal Reserve over its next move, Boston Fed President Eric Rosengren on Wednesday called further policy easing to bring down high unemployment even as two other top Fed officials said no further action was now needed.
"I believe further monetary policy accommodation is both appropriate and necessary," Rosengren told the Worcester Regional Research Bureau's annual meeting.
And if Europe's debt crisis worsens or U.S. lawmakers allow scheduled tax hikes and spending cuts to sending the domestic economy over a "fiscal cliff" at year's end, "more aggressive actions would certainly be warranted," Rosengren warned.
Dylan Ratigan: The Troubling Revolving Door
Between Federal Reserve Officials and Wall Street Also, an optimistic view of California's entrepreneurial culture
James J Puplava CFP with Dylan Ratigan - FinancialSense.com
Jim is pleased to welcome back Dylan Ratigan of MSNBC's The Dylan Ratigan Show to discuss a story he helped break regarding the cozy revolving door between Fed officials taking lucrative Wall Street positions, and then returning to the Fed. Dylan also discusses the general lack of transparency at the Federal Reserve. On an optimistic note, he was encouraged by the entrepreneurial culture he discovered on a recent visit to California.
Pending home sales post surprise fall in April
By Jason Lange
(Reuters) - Contracts to purchase previously owned U.S. homes unexpectedly fell in April to a four-month low, undermining some of the recent optimism that the housing sector was touching bottom.
The National Association of Realtors said on Wednesday its Pending Home Sales Index, based on contracts signed last month, fell 5.5 percent to 95.5, its lowest level since December, after a downwardly revised 3.8 percent increase in March.
Public Pension Plans Faulted for Lofty Return Assumptions
BY DANIELLE PARK - FinancialSense.com
For more than a decade pension plans have been using unreasonable investment return assumptions in their funding plans. Since no one wants to admit this or face the increased contributions needed to catch up to capital requirements, the hole just keeps getting bigger. This article offers a good update:
While Americans are typically earning less than 1 percent interest on their savings accounts and watching their 401(k) balances yo-yo along with the stock market, most public pension funds are still betting they will earn annual returns of 7 to 8 percent over the long haul, a practice that Mayor Michael R. Bloomberg recently called "indefensible."
20,000 applicants - 877 job openings Auto Jobs: Sign of the Times
By: Phil LeBeau - CNBC.com
It should not come as a surprise with unemployment over 8% that good paying jobs in manufacturing are harder than ever to land.
At the Hyundai plant in Montgomery, Alabama more than 20,000 people have applied for one of the 877 job openings.
The surge of people applying may seem unusual, but it's not.
Take a look:
United To Cut 1,300 Houston Jobs After Win By Southwest
By Mary Jane Credeur and Mary Schlangenstein - Bloomberg.com
United Continental Holdings Inc. (UAL) plans to cut 1,300 jobs and some service at Houston's main airport after the city backed Southwest Airlines Co. (LUV)'s bid to start international flights from a secondary facility.
The 10 percent reduction in seating capacity at George Bush Intercontinental Airport includes dropping a planned route to Auckland, United told employees in a memo today. Most of a $700 million terminal project at IAH, as the airport is known, is "in significant doubt," Chicago-based United said.
White Working Class: Angry, Cynical and Losing Faith
By MARGOT ROOSEVELT, Reuters - TheFiscalTimes.com
Eight months ago, Kathleen Wilmink was a single mother, waitressing at night and coding fees for a medical billing company by day. Her pay: $10 an hour. Today she works 12-hour shifts at a steel plant, tending a ladle that pours 300 tons of red-hot liquid metal into molds. It is a sooty, sweaty task. "We wear leather gloves," she said, "so our hands don't catch on fire." Her pay: $21 an hour plus incentives, bonuses and generous medical benefits.
Wilmink's new job is good news for President Barack Obama. ArcelorMittal, the global steel giant, is hiring again at the century-old mill that straddles the Cuyahoga River. Orders are up, thanks in part to a revival of the U.S. automobile industry for which the Obama administration claims credit.
Job recovery is scant for Americans in prime working years
By Peter Whoriskey - WashingtonPost.com
The proportion of Americans in their prime working years who have jobs is smaller than it has been at any time in the 23 years before the recession, according to federal statistics, reflecting the profound and lasting effects that the downturn has had on the nation's economic prospects.
By this measure, the jobs situation has improved little in recent years. The percentage of workers between the ages of 25 and 54 who have jobs now stands at 75.7 percent, just a percentage point over what it was at the downturn's worst, according to federal statistics.
Before the recession the proportion hovered at 80 percent.
Unemployment Benefits Ending
Sooner Than Expected for Many
By John Grgurich, The Motley Fool - DailyFinance.com
On May 12, displaced workers in eight states lost their unemployment benefits -- anywhere from 13 to 20 weeks earlier than expected. That brought the total number of workers who have prematurely lost their benefits so far this year to 400,000 in 27 states, and next month, 70,000 more Americans will.
This is all happening despite Congress extending the long-term unemployment benefits program in February.
It Was Nice While It Lasted.
How The Super Rich Avoid Taxes
Even As They Demand That The Rest Of Us Pay More
By Michael Snyder - TheEconomicCollapseBlog.com
The way that we tax people in the United States is fundamentally broken and should be completely discarded. The U.S. tax code is absolutely riddled with loopholes that allow the super rich to legally avoid taxes while many of the rest of us are being taxed into oblivion. In our system of taxation, middle class families that work hard and try to play by the rules are deeply penalized while those that are willing to abuse the system make out like bandits. There is something fundamentally wrong with a system that enables wealthy politicians such as Barack Obama and Mitt Romney to pay a smaller percentage of their incomes in taxes than millions of middle class families. Mitt Romney has millions of dollars parked down in the Cayman Islands and in other tax havens. He does this to avoid taxes. Unfortunately, most Americans do not have the resources to funnel money through offshore tax havens. Most Americans just automatically have their paychecks shredded by taxes and then try to live on whatever is left over. Most Americans are just trying to survive financially from one month to the next. But the super rich have options. Thanks to technology, they can live almost anywhere they want and they can run their companies and manage their investments from anywhere in the world. The truth is that the wealthier you are the easier it is to avoid taxes. But even as the ultra-wealthy do their best to avoid taxes, many of them still feel free to demand that the rest of us be taxed more.
California tuna connoisseurs shy away
from sushi over Japan radiation fears Radiation traces from the Fukushima nuclear disaster have been found off the US coast, and consumers are being cautious
By Rory Carroll in Los Angeles - Guardian.co.uk
Rodel Jugao studied the menu's sushi options a moment, then pondered the Pacific ocean surf foaming just two blocks away. He shook his head. "Nah. I'm going for the chicken or beef."
This Los Angeles outlet of Sarku Japan, a restaurant chain, did excellent fish and Jugao, 33, was a sushi lover. But for this lunch he preferred to stay terrestrial. "It's concerning. You don't want food, you know, to glow."
He appeared to speak for many other diners in a city which adores sushi – on condition it's not radioactive.
Survey says Internet traffic to grow fourfold by 2016
By THE WASHINGTON TIMES
The boom in the number of mobile Internet devices and tablet computers in use will help quadruple Web traffic in the coming years, a study said Wednesday.
The Cisco Visual Networking Index said global Internet traffic by 2016 will be 1.3 zettabytes. A zettabyte is one trillion gigabytes, or one sextillion bytes.
That will be four times the level of traffic generated in 2011, according to Cisco, and comes from a proliferation of tablets, smartphones and other devices that use the Internet.
U.S. tech companies warn of threat
to Internet from foreign governments
By Cecilia Kang - WashingtonPost.com
U.S. officials and high-tech business giants have launched an assault against what they view as a massive threat to the Internet and to Silicon Valley's bottom lines: foreign governments.
In a congressional hearing Thursday, they will warn lawmakers of a growing movement led by China, Russia and some Arab states to hand more control of the Web to the United Nations and place rules on the Internet that the U.S. companies say would empower governments to clamp down on civil rights and free speech.
How Facebook Killed the Virtual World
By Mark Wallace - Wired.com
The Facebook IPO, however rocky, marked a coming of age for the loose collection of technologies and services known as "social media." If Mark Zuckerberg had been elected governor of California, it would not have done as much to confer society's seal of approval. It was almost as if the internet itself went public.
The promise of new and richer means of interacting remotely with friends, colleagues, associates, and strangers; the medium for distributed communities to come together in meaningful fashion, create new forms of narrative and entertainment (as well as new form of marketing), and connect in ways not possible in the physical world; the ability to be just who you are, or whoever you'd like to be, or to drop off the grid entirely if you so chose (and could manage it) — if those promises sound familiar, it's no wonder. They are the promises (or threats) that have been made by every new communications technology since at least the telephone. Most recently, though, they were being made by a class of online service known as virtual worlds — and if Facebook's IPO was an apotheosis for social media, it also marked a harsh awakening from the dream of the future presented by virtual worlds, a dream that has kicked around the internet in one form or another since the late 1970s.
Teen's Facebook Posting Gets Her Mom's House Robbed
By Jill Krasny- Business Insider - DailyFinance.com
Here's another reason you might consider quitting Facebook: Posting photos of your cash could get you robbed.
Daily Telegraph'sClementine Quero reports a 17-year-old washelping her 72-year-old grandma count her savings when she decided to snap a photo of some wads of cash and post it to Facebook.
It wasn't long after that two men armed with a wooden club and knives broke into the teen's mother's house, demanding to know about the money. The guys made off with some personal items, but thankfully no one was hurt, including the mother, who'd told the the crooks her daughter no longer lived there. (We only hope the teen has since switched her Facebook settings to private.)
Facebook - equities' death knell
By Martin Hutchinson - ATimes.com
The Facebook initial public offering, with its combination of management arrogance, private equity greed and Nasdaq ineptitude, has certainly changed the atmosphere in the United States and global stock markets. The question is whether, like the ill-fated AOL-Time Warner merger of 2000, it has merely marked the peak of a temporary bubble or the final end of the equity investing cult among the ordinary public.
In the stable days before 1914, retail investors bought few stocks. Bonds represented the best means of saving for retirement or other purposes. Because Britain and the United States were on the gold standard, principal on bonds of first-class governments and major railroads and corporations was secure against inflation and the interest suffered either no income tax (in the United States before 1913) or a low rate of income tax (as in Britain from 1842 to 1914).
Why Does The Mainstream Media Ignore The Bilderberg Group?
By Michael Snyder - EndOfTheAmericanDream.com
Over the next several days, more than a hundred of the most powerful people on the planet will attend a secret conference at a hotel in Chantilly, Virgina. Some of the biggest names in politics and business will be there. The hotel is going to be completely locked down and will be swarmed by hordes of security guards carrying machine guns. This conference is so important that even the U.S. Secret Service is rumored to be involved in providing security. These meetings have been held yearly since 1954, but no record of what goes on at them has ever been officially released to the public and all the attendees are sworn to secrecy. Decisions made at this conference will affect the lives of every man, woman and child on the planet. But the vast majority of Americans will have no idea that the Bilderberg Group is meeting about 20 miles from Washington D.C. this year because the mainstream media in the United States ignores the Bilderberg Group almost entirely year after year. Based on the coverage it gets from the U.S. media, you would think that the Bilderberg Group was a non-event. But if some of the most powerful people on the planet are getting together to discuss our future, don't you think the mainstream media should be covering it?
Pete Hoekstra Defends Birther Commission Proposal
By BENJY SARLIN - TalkingPointsMemo.com
Rep. Pete Hoekstra (R-MI) defended his proposal to create a new federal commission staffed with FBI and CIA officers that would investigate presidential candidates' place of birth Wednesday, after video of him suggesting such a group surfaced online.
Hoekstra, who is running for Senate and hoping to challenge incumbent Sen. Debbie Stabenow (D-MI), first pitched the idea at a town hall last month, footage of which surfaced Wednesday. The Michigan Democratic Party derided the idea as a "birther office" and said it placed Hoekstra firmly in the Donald Trump zone of the conservative fringe.
Who Will the President Kill Next? It's a Secret
By Bill Boyarsky - Telegraph.co.uk
The revelation that President Barack Obama is personally selecting names for a kill list of suspected al-Qaida terrorists is a striking illustration of what actually occurs behind the White House's closed doors.
The New York Times revealedTuesday how the president "has placed himself at the helm of a top secret 'nominations' process to designate terrorists for kill or capture, of which the capture part has become largely theoretical." He insists "on approving every new name on an expanding 'kill list,' poring over terrorist suspects' biographies on what one official calls the macabre 'baseball cards' of an unconventional war."
China's Political Storm
By Brahma Chellaney - Project-Syndicate.us
NEW DELHI – As senior leaders are purged and retired provincial officials publicly call for Politburo members to be removed, it has become clear that China is at a crossroads. China's future no longer looks to be determined by its hugely successful economy, which has turned the country into a world power in a single generation. Instead, the country's murky and increasingly fractured politics are now driving its fate.
U.S. must stop using China's fake military parts
By Alan Tonelson - Special to The Washington Times
While addressing West Point's newest graduates last weekend, Vice President Joseph R. Biden praised the gathered cadets as "leaders of your generation" and "the key to whatever challenges the world has in store."
For full disclosure's sake, Mr. Biden should have added: "For the foreseeable future, however, the advanced weapons and military systems you'll use in training and in combat will remain shot through with unreliable counterfeit electronics parts.
Chinese 'looking for opportunities' in U.S. Companies bullish when it comes to investing
in American businesses
By Tim Devaney-The Washington Times
China is bullish on the U.S. economy.
The world's most populous country is in the midst of a wave of purchases and investments in American companies.
The influx of Chinese capital is welcomed by some economists, while others fear the increasing influence of the rising superpower.
"There are a lot of Chinese companies that are interested in coming to America and buying companies," said Siva Yam, president of the U.S.-China Chamber of Commerce. "We have seen an increasing trend of Chinese companies investing in America."
China steals $114 million U.S. defense deal with Peru Beijing learns tricks in contracts market
By Kelly Hearn - Special to The Washington Times
LIMA, Peru — Trade between China and Peru, a key U.S. ally in the regional drug war, is at a new high. Now the Chinese defense industry is getting in on the action.
Military officials from Beijing increasingly are making high-level visits, pushing initiatives to protect Chinese nationals and companies here and, in some instances, undermining U.S. arms deals in order to sell their own weapons to this resource-rich Andean nation.
Moscow pledges to block UN over foreign intervention in Syria Russian minister maintains foreign military action after Houla massacre will only worsen violence in Syria
By Ian Black, Middle East editor - The Guardian
Russia has made clear that it will block UN support for foreign military intervention in Syria, scotching slim hopes that the massacre of more than 100 people at Houla would break the impasse in the international response to ongoing violence.
Moscow's crucial support for Syria's president, Bashar al-Assad, has not changed after confirmation from a UN human rights body that 108 people, including 49 children under 10, were killed in the weekend incident near Homs, mostly in summary killings by the feared Shabiha militia, linked to the Assad regime.
Updates on the Syrian Conflict
Truthdig.com
Among the latest developments in the Syrian humanitarian crisis, China and Russia have reaffirmed their opposition to a forced regime change; Turkey and Japan joined 11 other countries in expelling Syrian diplomats, and the U.N.'s Human Rights Council is due to meet to discuss the massacre in the city of Houla.
Turkey warned that it and the international community would take "further measures" if the Assad regime's slaughter of Syrians continued.
Syrian rebels issue cease-fire deadline
DAMASCUS, Syria, May 30 (UPI) -- Rebel forces in Syria Wednesday gave President Bashar Assad's government 48 hours to implement a United Nations cease-fire plan, a rebel leader said.
Col. Qassim Saadeddine of the Free Syrian Army said if officials in Damascus fail to end the violence by midday Friday, the opposition group would consider itself "no longer bound by the ... peace plan," the BBC reported.
Germany Has A Generous Proposal
To The Broke PIIGS: "Cash For Gold"
Submitted by Tyler Durden - ZeroHedge.com
Back in February, as part of the latest Greek bailout of European banks, we noted that the most subversive part of the German-led proposal was nothing short of a gold confiscation scheme.
...the European bailout of Greece, is now formally a Greek bailout of Europe, funded by the country's already negative primary surplus, or better said - deficit (don't try to make mathematical sense of that - a scene out of Scanners is guaranteed). Hence, negative bailout. But the piece de resistance, and the reason why Greece is the in situ version of bankster heaven is the news from the NYT that Greece is also about to have negative gold.
...Ms. Katseli, an economist who was labor minister in the government of George Papandreou until she left in a cabinet reshuffle last June, was also upset that Greece's lenders will have the right to seize the gold reserves in the Bank of Greece under the terms of the new deal.
Europe's debtors must pawn their gold for Eurobond Redemption
Southern Europe's debtor states must pledge their gold reserves and national treasure as collateral under a €2.3 trillion stabilisation plan gaining momentum in Germany.
By Ambrose Evans-Pritchard - Telegraph.co.uk
The German scheme -- known as the European Redemption Pact -- offers a form of "Eurobonds Lite" that can be squared with the German constitution and breaks the political logjam. It is a highly creative way out of the debt crisis, but is not a soft option for Italy, Spain, Portugal, and other states in trouble.
The plan is drafted by the German Council of Economic Experts and inspired by Alexander Hamilton's Sinking Fund in the United States -- created in 1790 to clean up the morass of debts left by the Revolutionary War. Flourishing Virginia was comparable to Germany today.
When The Derivatives Market Crashes (And It Will)
U.S. Taxpayers Will Be On The Hook
By Michael Snyder - TheEconomicCollapseBlog.com
Warren Buffett once said that derivatives are "financial weapons of mass destruction", and that statement is more true today than it ever has been before. Recently, JP Morgan made national headlines when it announced that it was going to take a 2 billion dollar loss from derivatives trades gone bad. Well, it turns out that JP Morgan did not tell us the whole truth. As you will see later in this article, most analysts are estimating that the losses will eventually be far larger than 2 billion dollars. But no matter how bad things get for JP Morgan, it will not be allowed to fail. JP Morgan is the largest bank in the United States, so it is essentially the "granddaddy" of the too big to fail banks. If JP Morgan gets to the point where it is about to collapse, the U.S. government and the Federal Reserve will rush in to save it. Because of this "security blanket", banks such as JP Morgan feel free to take outrageous risks. Today, JP Morgan has more exposure to derivatives than anyone else in the world. If they win, they win big. If they lose, U.S. taxpayers will be on the hook. Not only that, but thanks to Dodd-Frank, U.S. taxpayers are on the hook for bailing out the major derivatives clearinghouses if there is ever a major derivatives crisis. So when the derivatives market crashes (and it will) you and I will be left holding a gigantic bill.
Consumer confidence falls in May
By Ruth Mantell, MarketWatch
WASHINGTON (MarketWatch) — A gauge of U.S. consumer confidence declined for a third month, with gloomier views in May on present and future conditions, the Conference Board reported Tuesday.
The consumer-confidence index fell to 64.9 in May — the lowest level since January — from a revised 68.7 in April. A prior estimate for April pegged the level at 69.2, according to the Conference Board, a membership and research group.
Economists polled by MarketWatch had expected a reading of 70 for May.
Warning: America's new Age of Austerity starts now Denials, delays will deepen the impact
By Paul B. Farrell, MarketWatch
SAN LUIS OBISPO, Calif. (MarketWatch) — Warning, tighten your belts, America's new Age of Austerity is already here, today. There I said it. I admit it. And you better too. Prepare now. Could be like the 1930s depression austerity.
You've seen the warnings all across the major newspapers about a global slowdown. But why no warnings of austerity dead ahead? Why? America's still deep in denial. We prefer happy talk to the truth. No, nobody will get honest about austerity till after the elections. Then it'll hit hard.
One More Melt-up Before the Crash?
By: Rick Ackerman - GoldSeek.com
Whatever happened to all that money Helicopter Ben printed? Surprisingly not very much. Between late 2008 and the end of 2011, the Fed injected almost $2 trillion in the financial system. Most of it, however, is parked in banks as reserves. At the same time, the Fed announced it would pay interest on those reserves. They paid $2 billion in 2009 alone. Since the Fed created an incentive for banks to hold that cash, 88 percent of it was still being held as of December 31. There goes the theory that we could inflate our way out of this mess! In fact, the Fed has done exactly the opposite, creating a system that pumps banks full of interest-free money while keeping that money from circulating. How ingenious! M2 velocity, which measures the frequency with which a unit of money is used, then re-used, to buy goods and services, has been contracting since 1999. In fact, it is near an all-time low. At least, it was up until a few months ago. The recent announcement of a huge borrowing frenzy last month could be an anomaly, or a breakout of all that zero-velocity cash. But up until recently, the money has not been lent, or spent.
No such thing as a free lunch
By Irwin Kellner, MarketWatch
PORT WASHINGTON, N.Y. (MarketWatch) — When it comes to assigning blame for Washington's humongous debt, we need only look in the mirror.
The tenor of a number of comments on last week's column suggests that I did not make my point clearly, so let me re-phrase. I was not asserting that there was a need for debt; rather I merely chronicled its rise.
Let me follow this up: To determine why Washington's debt grew to today's proportions, you need to recall the immortal words of that great philosopher, Pogo, who said "We have met the enemy and he is us."
Why We're Ungovernable: Gridlock and the Fiscal Cliff
BY JOHN RUBINO - FinancialSense.com
Europe's political problems are hogging the headlines, with good reason. So much debt is coming due so soon that big decisions about Greece and Spain have to be made within the next couple of months to avoid a systemic melt-down.
But the US has some deadlines of its own, with no consensus on what to do about them. Consider:
Congress staring over edge of 'fiscal cliff'
For Congress, the outlines of the pending fiscal crisis are clear: Don't do a thing, and watch the economy slip into a double-dip recession early next year. Or cancel the looming tax increases and spending cuts, watch the deficit rise, and push the government ever closer to a European-style debt crisis.
The Broken Legs of Global Trade
By Jagdish Bhagwati - Project-Syndicate.org
NEW YORK – The Doha Round, the latest phase of multilateral trade negotiations, failed in November 2011, after ten years of talks, despite official efforts by many countries, including the United Kingdom and Germany, and by nearly all eminent trade scholars today. While trade officials in the United States and the European Union blamed the G-22 developing countries' excessive demands for the failure of earlier negotiations in Cancún in 2003, there is general agreement that this time it was the US whose unwarranted (and unyielding) demands killed the talks. So, now what?
Debt crisis: a $46 trillion problem comes sweeping in Bad stuff, they say, comes in threes. We've already got the banking and the eurozone sovereign debt crises. Next comes the corporate funding crisis.
By Jeremy Warner - Telegraph.co.uk
Just as you thought things couldn't get any worse, credit markets are about to be hit by a veritable tsunami of maturing corporate debt. Standard & Poor's estimates that companies in Europe, the US and the major Asian economies require a combination of refinancing and new money to fund growth over the next four years of between $43 trillion and $46 trillion. The wall of maturing debt is unprecedented, raising the prospect of further, extreme difficulties in credit markets.
With the eurozone debt crisis still at full throttle, the Chinese economy slowing fast and a still tepid US recovery, it's not clear that the banking system is in any position to deal with this incoming wave of demand.
Bank of England readies plan for Euro collapse
The Bank of England is poised to cut interest rates or launch another round of quantitative easing if the euro collapses, it has emerged.
By Robert Winnett - Telegraph.co.uk
A senior official for the Bank said the measures would "again play [their] part in mitigating the impact" of Greece or other countries leaving the single currency.
The comments come after the head of the IMF suggested last week that British interest rates may have to be cut to zero if the economic situation deteriorates.
The Bank has already completed a quantitative easing programme, effectively printing more money, worth £325 billion and this may be extended again.
Greece Pours $22.6 Billion Into Four Biggest Banks
Reuters - CNBC.com
Greece handed 18 billion euros ($22.6 billion) to its four biggest banks on Monday, an official said, allowing the stricken lenders to regain access to European Central Bank funding.
The long-awaited injection — via bonds from the European Financial Stability Facility rescue fund — will boost the nearly depleted capital base of National Bank, Alpha, Eurobank and Piraeus Bank.
"The funds have been disbursed," an official at the Hellenic Financial Stability Facility, who declined to be named, told Reuters.
Germany not willing to foot bill for bottomless pit Greeks Furious Over Harsh Words from IMF and Germany As Greeks prepare to head to the polls once again in three weeks, international criticism of the country is intensifying. IMF head Christine Lagarde on Friday said citizens must begin paying their taxes, while a member of the German cabinet referred to Greece as a "bottomless pit."
Der Spiegel - Spiegel.de
It's not often that world markets react to pre-election political surveys in countries the size of Greece. But on Monday, investor relief appears to be widespread at reports that support for pro-austerity parties in Greece is rising ahead of general elections scheduled for June 17.
According to the polls, an increase of support for the center-right party New Democracy could give it enough seats in parliament to team up with the Socialist PASOK party, both of which support pursuing the austerity policies handed down by the European Union and International Monetary Fund (IMF) in exchange for massive bailout aid. The anti-austerity party Syriza is likely to come in second. The new elections became necessary after results from the vote on May 6 made the formation of a governing coalition impossible.
Serbian leader would give up EU to keep Kosovo
BY ANDREW RETTMAN - EUObserver.com
BRUSSELS - Serbia's new President, Tomislav Nikolic, has told Russia he would give up EU membership for Kosovo, but wants to have both.
Nikolic went to Moscow on Friday (26 May) in his first post-election but pre-inauguration foreign trip.
He told press after the meeting that if the EU ever asks him to recognise Kosovo's independence, then: "We cannot do that, even if it meant breaking off [EU entry] negotiations at that very moment."
Spanish and Italian borrowing costs soar
BY VALENTINA POP - EUObserver.com
BRUSSELS - The cost of insurance against a Spanish default reached another record on Monday, with Italy's borrowing costs also rising sharply amid continued market fears about the fate of the eurozone.
"With a risk premium at 500 points, it is very difficult to raise finances," Spanish Prime Minister Mariano Rajoy said Monday (28 May) in a press conference. His country's 'debt risk premium' - the default insurance investors demand on Spanish bonds compared to German bunds - that day leapt to a eurozone record of 514 basis points.
ECB rejects Spain's Bankia recap plan
By Wallace Witkowski, MarketWatch
SAN FRANCISCO (MarketWatch) — Spain will have to come up with another plan to recapitalize Bankia SA after the European Central Bank reportedly torpedoed a proposal to use government debt.
The ECB said Spain's plan to use 19 billion euros ($24 billion) in sovereign bonds to recapitalize the bank was in danger of violating a ban forbidding the central bank to finance governments, the Financial Times reported in its online edition late Tuesday, citing European officials.
Another treaty, another Irish referendum
BY ANDREW DUFF - EUObserver.com
BRUSSELS - Another European treaty. Another Irish referendum. Once again the main political parties, somewhat battle weary, join forces to argue Yes. Sinn Fein and Declan Ganley, the maverick federalist, campaign for a No.
Most voters evince no or little knowledge about what the referendum is officially about ‑ the Treaty on Stability, Co-ordination and Governance in the Economic and Monetary Union, or fiscal compact treaty for short. Come polling day, 31 May, many may not vote.
The significance of the Irish referendum seems also to have escaped Ireland's EU partners.
Europe Prepares 'New Stage' in Financial Union European leaders preparing radical steps toward creation of a European superstate—on German terms.
BY ROBERT MORLEY - TheTrumpet.com
Europe is at a "crucial moment in its history," said European Central Bank President Mario Draghi last Thursday. "The process of European integration needs a courageous jump in political imagination to survive."
Will Europe find enough courage to do what emperors and dictators have spilled oceans of blood to attain?
Bible prophecy says yes—a new European empire is getting close to revealing itself to the world.
Asia Exposed
By Stephen S. Roach - Project-Sundicate.org
NEW HAVEN – Asian authorities were understandably smug in the aftermath of the financial crisis of 2008-2009. Growth in the region slowed sharply, as might be expected of export-led economies confronted with the sharpest collapse in global trade since the 1930's. But, with the notable exception of Japan, which suffered its deepest recession of the modern era, Asia came through an extraordinarily tough period in excellent shape.
That was then. For the second time in less than four years, Asia is being hit with a major external demand shock. This time it is from Europe, where a raging sovereign-debt crisis threatens to turn a mild recession into something far worse: a possible Greek exit from the euro, which could trigger contagion across the eurozone. This is a big deal for Asia.
Bill Black "disinvited" from Testifying
before Congress about Derivatives We Must Not Speak Uncomfortable Truths to Power:
Why I Won't be Briefing Congress about Derivatives
By William K. Black - CapitalismWithoutFailure.com
When I was the Deputy Director of FSLIC, House Banking Committee Chairman St Germain was helping Speaker Wright hold the FSLIC recapitalization bill hostage to extort favors for Texas control frauds, including Don Dixon's Vernon Savings (which was providing prostitutes to the State of Texas' top S&L regulator and was building towards having 96% of its ADC loans in default – which is why we referred to it as "Vermin"). The attack on our agency was that we were mad dogs biased against Texas S&Ls and causing the Texas crisis by closing too many insolvent but well-run Texas S&Ls. Our response had many elements, but one of our principal points was that the Texas S&Ls we were closing were typically control frauds. At this juncture, St Germain's staffers made a mistake. They requested that we testify on a host of issues, but the invite letter had a zinger, premised on an article saying that the Feds were slow to prosecute frauds in the Southwest. The invite specifically called for us to respond and discuss the role of fraud in the Southwest. We used the opportunity to explain the extensive role of fraud in Texas S&L failures.
If California Were Greece
BY JOHN MAULDIN - FinancialSense.com
It is simply hard to tear your eyes away from the slow-motion train wreck that is Europe. Historians will be writing about this moment in time for centuries, and with an ever-present media as we see it unfold before our eyes. And yes, we need to tear our gaze away from Europe and look around at what is happening in the rest of the world. There is about to be an eerily near-simultaneous ending to the quantitative easing by the four major central banks while global growth is slowing down. And so, while the future of Europe is up for grabs, the true danger to global markets and growth may be elsewhere. But, let's do start with the seemingly obligatory tour of Europe.
Bank Runs
By Joe Flood - NYMag.com
Massive account withdrawals are in the news thanks to Europe. But while the proximate causes of the situation are unique to our time, the tradition of freaking out and demanding one's money is thousands of years old.
Read article for details...
• Fourth Century B.C.: The Platonic Ideal of Financial Chicanery
Sicily
• 1620s: Currency Problems in Germany? You Don't Say.
Kipper-und Wipperzeit, Holy Roman Empire
• 1772: Financial Haggis
United Kingdom
• 1873: The Great Freakout of 1873
Western Hemisphere
• 1914: Schwenk Bank Run
New York, New York
• 1930s: Great Depression
U.S.
• 1946: Potter's Panic
Bedford Falls, New York
• 1980s: Savings-and-Loan Crisis
U.S.
• 2001: Malos Aires
Argentina
• 2011–present: EuroBlown
Greece
Will There Be Stimulus?
BY JAMES J PUPLAVA CFP - FinancialSense.com
This weekend's Memorial Day holiday marks the unofficial start of summer. It is also the beginning of the Atlantic hurricane season which officially begins June 1st and runs until the end of November. The question many investors are asking right now: Is it time to "sell in May and go away?" Will the events of 2010/2011 be repeated again? Will the summer be sunny with mild balmy weather or tumultuous with thunderstorms, tornadoes and hurricanes? Our belief is that it depends on at least two main conditions:
1) Further policy responses
2) More positive economic news
The fate of global financial markets and economies are once again in the hands of policymakers. The third wave of global monetization is now coming to an end. The Fed's "Operation Twist"—switching short-term bonds for long-term bonds—ends in June...
The Disastrous Invention of a New Middle Class
By Robert Weissberg, TheFiscalTimes.com
To hear politicians tell it, the college diploma is the guaranteed gateway to middle-class life, so everybody should probably go to college. The argument seems self-evident—over a lifetime, college graduates far out-earn those without a degree ($2.1 million, supposedly), so go to college, live the American Dream. Unfortunately, as many recent college graduates have discovered, diplomas no longer guarantee success.
A Bureau of Labor Statistics study, reported that in 1992 some 119,000 waiters and waitresses had college degrees. But by 2008, this figure had soared to 318,000. The study also found similar increases of under-employment in other low-level occupations. In 2010, the unemployment rate for college graduates was the highest since 1970.
Consumer Confidence In U.S. Fell In May To Four-Month Low
By Timothy R. Homan - Bloomberg.com
Confidence among U.S. consumers unexpectedly fell in May to the lowest level in four months as optimism about employment prospects faded.
The Conference Board's index decreased to 64.9 this month from a revised 68.7 in April, figures from the New York-based private research group showed today. Home prices in 20 cities dropped in the 12 months ended in March at the slowest pace in more than a year, according to another report.
The share of Americans expecting fewer job opportunities in the next six months climbed to the highest level since November, raising the risk that consumers will limit spending. A 30-cent decline in gasoline prices since early April failed to brighten spirits, showing that more progress is needed in the job market.
It's the Jobs, Stupid
by the Center for Geoeconomic Studies - CFR.org
The Conference Board's consumer confidence measure has, since its inception in 1967, been a perfect predictor of presidential incumbent election performance. As shown in the large figure above, every time the measure has averaged under 95 in the election year, the incumbent has lost; over 95, he has won.
Politicians and pundits seem to believe that gas prices will have a major impact on this November's election. "My poll numbers go up and down depending on the latest crisis," President Obama said in April, "and right now gas prices are weighing heavily on people." The average national price of a gallon of gas has fallen from $3.94 on April 5 to $3.64 today. How happy should the White House be?
US public pension funds take on more risk
NicosiaMoneyNews.com
US public pension funds have used loose regulation to camouflage their liabilities and take on risks as they have matured, according to a new study by academics from Yale and Maastricht universities.
US corporate pension plans, as well as corporate and public plans in Canada and Europe, responded to rising numbers of retirees and falling interest rates over the last 20 years by reducing investment risks, the study finds.
But US public funds have moved in the opposite direction: increasing allocations to risky investments such as stocks, private equity and alternatives even as their proportion of retired members increased.
Home prices lowest since 2002
By Jessica Dickler @CNNMoney
NEW YORK (CNNMoney) -- Home prices hit new post-bubble lows in March, according to a report out Tuesday.
Average home prices were down 2.6% from 12 months earlier, according to the S&P/Case-Shiller home price index of 20 major markets. Home prices have not been this low since mid-2002.
"While there has been improvement in some regions, housing prices have not turned," said David Blitzer, spokesman for S&P.
March Case Shiller Misses Expectations:
Housing Set For Quadruple Dip
Submitted by Tyler Durden - ZeroHedge.com
Following the now long-gone LTRO induced risk ramp through March, many of the C-grade economists out there predicted that housing would bottom in March (this time for real) and it would be smooth sailing from there. Alas, the just released March Case Shiller data puts this latest speculation very much in doubt (once again), following a miss of consensus expectations in the Top 20 Composite of a 0.20% increase, printing at half that, or 0.09%, and more importantly, a decline from the February rate of increase, which was 0.15%. The non-seasonally adjusted number declined by 0.03%, the 7th consecutive drop in a row. All this begs the question: did housing just quadruple dip, with a February local extreme in the Sequential rate of change. As the chart below shows, we had comparable peaks in the summer of 2009, in April 2010, and again in April 2011, following which the downward slide resumed every single time once the temporary benefits of monetary and fiscal easing subsided. Also, recall that March was the last month receiving benefits of a record warm winter: in effect a mini demand pull program. And now comes the hangover. Bottom line: based on a broad index, housing is about to decline once again, and make a total joke out of all those who, yet again, made "bold" annual housing bottom predictions.
The Fork in the Road for Health Care
By UWE E. REINHARDT - NYTimes.com
Milliman, the global actuarial and employee benefit consulting firm, released its annual Milliman Medical Index for 2012 on May 15. Based on a large, nationwide sample of families with employment-based health insurance, the index tracks the total cost of spending on health for a typical family of four under age 65 that is covered by an employment-based, preferred-provider health insurance plan.
The virtue of this index lies in its inclusion of out-of-pocket spending in total health spending. Just tracking premiums for employment-based health can be misleading, if employers shift more and more of the cost of health care out of their benefit package into deductibles or coinsurance paid by employees, exclude certain benefits altogether or otherwise limit coverage.
Groundbreaking Study Shows
Why Fixing Healthcare Costs Is Still a Top Priority And repealing the Affordable Care Act certainly won't magically lead to better outcomes.
By Joshua Holland - AlterNet.org
The greatest rip-off in the world is getting worse. According to a groundbreaking study released last week (PDF), the cost of employer-based health insurance – which covers a majority of the population -- has risen at twice the rate of inflation during the Great Recession, even while Americans have come to use less medical services.
It is a tragic irony that even as Washington debates whom to screw over to cut the Phantom Menace of our federal deficit, it has so far failed to address the single most important factordriving those deficits over the long term (if we paid the same for health care per person as the 30-plus countries with longer average life expectancies, we'd be looking at budget surpluses). It's a problem that also leads to tens of thousands of unnecessary deaths annually, creates some of the worst health outcomes in the developed world, makes American firms less competitive in the global marketplace and contributes a great deal to wage stagnation for the middle class and the working poor.
Not worth the debt Student loans: the ugly truth
By Glenn Harlan Reynolds - NYPost.com
I've been writing for years about a bubble in higher education: too much demand, causing sky-high prices — all because of cheap government money, much like the housing bubble. Now those warnings have become conventional wisdom — so conventional that they've reached The New York Times and even 60 Minutes.
Pretty much everyone agrees that the increases in tuition (which have vastly outpaced consumer prices and family incomes) and the growth in student-loan debt (which now exceeds credit-card or auto-loan debt) are unsustainable. As economist Herb Stein famously said, something that can't go on forever, won't. So, how should we respond?
U.S. Winds Down Longer Benefits for the Unemployed
By: Shaila Dewan, The New York Times - CNBC.com
Hundreds of thousands of out-of-work Americans are receiving their final unemployment checks sooner than they expected, even though Congress renewed extended benefits until the end of the year.
The checks are stopping for the people who have the most difficulty finding work: thelong-term unemployed. More than five million people have been out of work for longer than half a year. Federal benefit extensions, which supplemented state funds for payments up to 99 weeks, were intended to tide over the unemployed until the job market improved.
Whatever happened to "spare the rod... spoil the child"? Pastor Sentenced To 2 Years In Prison
For Teaching That Parents Should Spank Their Children
By Michael Snyder - EndOfTheAmericanDream.com
Do you believe that parents should be able to spank their children? Do you ever express that opinion to others? If so, then you could be sent to prison. Sadly, that is exactly what happened to one pastor up in Wisconsin recently. A minister named Philip Caminiti was sentenced to 2 years in prison for simply teaching that parents should spank their children when they misbehave. Please note that Caminiti was not accused of spanking anyone or of physically hurting anyone. He was put in prison simply for his speech. He was put in prison simply for what he was teaching others to do. Whether you agree with spanking or not, this should be incredibly sobering for all of us. Increasingly, speech is being penalized in the United States. Much of the time, the focus of the attacks by the forces of political correctness is on religious speech. If this trend continues, many of you that are reading this article might be put in jail for the things that you say in the coming years.
The War on Gays
By Chris Hedges - Truthdig.com
The sentencing of Dharun Ravi for the hateful abuse that may have driven his gay roommate at Rutgers, Tyler Clementi, to commit suicide, or Barack Obama's public acceptance of gay marriage, prevents many of us from seeing that life for gays, lesbians, bisexuals and transgender people is getting worse—much worse.
No one understands this better than the gay activist and pastor Mel White. White, along with his husband and partner of 30 years, Gary Nixon, founded Soulforce, an organization committed to using nonviolent resistance to end religion-based oppression. White and hundreds of Soulforce volunteers protest outside megachurches that preach hatred and bigotry in the name of religion. White travels to communities where young gays, lesbians, bisexuals or transgender people have committed suicide. He holds memorial services for them in front of the church doors. He accuses the pastors of these churches of murder. His books "Stranger at the Gate: To Be Gay and Christian in America" and "Holy Terror: Lies the Christian Right Tell Us to Deny Gay Equality," are two of the most important works that examine the innate cruelty and proto-fascism of the Christian right. White, more than perhaps any other preacher in the country, has pulled young men and women back from the brink of despair, from succumbing to the tragic fate of Tyler Clementi. And White is scared.
Senator Feinstein's Egg Bill (S. 3239) Faces Strong Opposition from Animal Protection Organizations
Source: PR Newswire
Rotten Egg Bill" Would Kill California's Proposition 2 and Keep Hens in Cages
SAN FRANCISCO, May 24, 2012 /PRNewswire-USNewswire/ -- The Humane Farming Association (HFA) and a coalition of animal protection organizations today expressed outrage over Senator Feinstein's introduction of "The Egg Products Inspection Act Amendments of 2012" (S. 3239). Referred to by many as the Rotten Egg Bill, Feinstein's measure is modeled on a similar bill (H.R. 3798) that was introduced by Rep. Kurt Schrader in the House earlier this year over the vehement objections of animal advocates nationwide.
The Sebelius Precedent: Time to Regulate Liberalism? Kansas votes to tax abortions --
should labor unions be taxed as well?
By JEFFREY LORD - The American Spectator.org
Let's call it The Sebelius Precedent.
If we're now going to breach the Constitutional right to religious liberty -- can an assault on political liberty be far behind?
Or, plainly put, is it time to tax and regulate liberalism?
The government, according to HHS Secretary Kathleen Sebelius (the headmistress of Obamacare) is going to regulate the Catholic Church.
In the words of CNN, last January:
Catholics around the country got an earful on Sunday from the pulpit over a new health insurance policy by the U.S. Department of Health and Human Services that forces employers to cover contraception and abortion as part of preventative care regardless of religious beliefs. The use of abortion and contraceptives violates Catholic teachings.
Shame on Zuck... the cheapscate billionaire Zuckerberg stiffs Rome waiter on honeymoon
by George Mathis - AJC.com
Facebook's $20 billion dollar man probably didn't get rich by being overly generous.
Now, Mark Zuckerberg's penurious ways are attracting the attention of at least one Rome waiter, who received no tip from the Facebook founder.
Zuckerberg is in Italy on his honeymoon. He married longtime girlfriend Priscilla Chan in his back yard the day after the social media giant's company went public, making him and many of his employees some of the richest people on Earth.
Investors Bet on Facebook Fall First Day of Options Trades Brings Wave of Skeptics;
Shares Off 24% Since IPO
By KAITLYN KIERNAN And JONATHAN CHENG - WSJ.com $$
Facebook Inc. shares slid an additional 9.6% Tuesday, as options trading began and investors placed largely negative bets on the stock's future.
Tuesday's decline to $28.84 puts shares of the social-networking company down 24% from their initial public offering at $38 apiece. Facebook's debut has been one of the worst performing of any large company, according to data tracker Dealogic.
The Menlo Park, Calif., company is now valued at $79 billion, compared with $104 billion at the time of its IPO. Chief Executive and co-founder Mark Zuckerberg has seen the value of his stake sliced to about $14.5 billion from $19.1 billion.
Drone Strikes Continue Thanks to Obama's 'Kill List'
By DASHIELL BENNETT - TheAtlanticWire.com
Memorial Day weekend brought news of more U.S. drone attacks in Pakistan and Afghanistan asThe New York Times raises new questions about President Obama's so-called "Kill List" of terrorists targeted for assassination. An extensive report in Tuesday's paper looks at the use of targeted attacks to take out terrorism suspects in other parts of the world, an increasingly important part of the government's anti-terrorism policies that Barack Obama himself has taken personal responsibility for. According to the story, the President approves every name on the list of terrorism targets, reviewing their biographies and the evidence against them, and then authorizing "lethal action without hand-wringing."
Secret 'Kill List' Proves a Test of Obama's Principles and Will
By JO BECKER and SCOTT SHANE - NYTimes.com
WASHINGTON — This was the enemy, served up in the latest chart from the intelligence agencies: 15 Qaeda suspects in Yemen with Western ties. The mug shots and brief biographies resembled a high school yearbook layout. Several were Americans. Two were teenagers, including a girl who looked even younger than her 17 years.
President Obama, overseeing the regular Tuesday counterterrorism meeting of two dozen security officials in the White House Situation Room, took a moment to study the faces. It was Jan. 19, 2010, the end of a first year in office punctuated by terrorist plots and culminating in a brush with catastrophe over Detroit on Christmas Day, a reminder that a successful attack could derail his presidency. Yet he faced adversaries without uniforms, often indistinguishable from the civilians around them.
Too Big to Work: Dewey and LeBoeuf Bankruptcy Sets Records
by ALEXANDER ABAD-SANTOS - TheAtlanticWire.com
Dewey & LeBoeuf, a law firm that employed thousands, filed for bankruptcy on Monday night. We probably would too if we had a debt of $245 million. Dealbook's Peter Lattman calls the filing, "the largest law firm collapse in United States history" and Bloomberg's Linda Sandler, Sophia Peterson, and Joe Schneider point out that Dewey is about $245 million in debt which overshadows its $193 million in assets. Lattman adds that the firm has in total some $315 million in liabilities. Oof.
Iran–EU Debt Crisis Update
By Greg Hunter's USAWatchdog.com
The meeting, last week, in Iraq to negotiate a resolution to Iran's nuclear program ended with zero concessions on either side. The only thing positive was an agreement for another meeting, next month, in Russia. This meeting is more than a discussion over Iran's nuclear ambitions but more about the world powers trying to avoid all out global war. Now, there is a new wrinkle. The Israelis are putting the military option back on the table after secretly making an agreement with the Obama Administration to hold off until after the November elections. The Israelis are distraught that the Iranians continue to manufacture highly enriched uranium that is near weapons grade. It was, also, reported late Friday night that the Iranians have doubled their stock pile of enriched uranium in the last few months. As far as the EU debt crisis is concerned, things are getting worse.
U.S.A. 2012: Is This What We've Become?
Charles Hugh Smith - OffTwoMinds.com
Memorial Day is traditionally a day to speak of sacrifices made in combat. Like much of the rest of life in America, it has largely become artificial, a hurried "celebration" of frenzied Memorial Day marketing that is quickly forgotten the next day.
Instead of participating in this rote (and thus insincere) "thank you for your sacrifice" pantomime, perhaps we should ask what else has been sacrificed in America without our acknowledgement. Perhaps we should look at the sacrifices that need to be made but which are cast aside in our mad rush to secure "what we deserve."
The unvarnished reality is that most Americans have no idea what service members experienced in Iraq and Afghanistan, and they don't want to know. When 4,488 white crosses were erected on a hillside to remind us of all those who made the ultimate sacrifice in Iraq, people didn't like it, labeling it "unpatriotic."
Gold retains bullish outlook,
$1665/oz forecast for Q2, 2012: Barclays
NEW YORK (Commodity Online): Gold prices are under pressure trading below $1600 but given the bullish macro-environment, concerns over long term inflation and continued central bank buying, the near-term prospects for gold is bullish, according to Barclays Capital.
Barclays said that it is retained a positive view on gold, given the on going market uncertainty, lower interest rate environment, concerns over longer-term inflation and continued central bank buying.
Gold to continue outperform Silver,
PGM's in 2012 but faces near term risk: Deutsche Bank
LONDON (Commodity Online): Gold to keep outperforming the other precious metals (mainly Silver and PGMs) this year, yet also suggests the yellow metal faces some near-term downside risk should the unstable outlook in Europe lead to more strength in the U.S. Dollar, said Deutsche Bank, the largest bank in Germany, in a weekly commodities report.
"However, the significant liquidation in speculative length is providing a more supportive positioning environment for the sector, in our view," the German bank added.
Dollar Scarce As Top-Quality Assets Shrink 42%
By John Detrixhe - Bloomberg.com
The dollar is proving scarce, even after the Federal Reserve flooded the financial system with an extra $2.3 trillion, as the amount of the highest-quality assets available worldwide shrinks.
From last year's low on July 27, the greenback has risen against all 16 of its major peers. Intercontinental Exchange Inc.'s Dollar Index surged 12 percent, higher now than when the Fed began creating dollars to buy bonds under its extraordinary stimulus measures at the end of 2008.
Value in Devaluation?
Mises Daily: Monday, May 28, 2012 by Patrick Barron
The euro is in trouble. That is not news. What is news is that people with deep pockets are willing to pay for economists to provide a solution. Lord Wolfson has offered a £250,000 prize for the best way a country can exit the European Monetary Union (EMU). Five finalists for the prize were announced in March. The winner will be announced in June.
None of the five finalists — Neil Record, Jens Nordvig, Jonathan Tepper, Catherine Dobbs, and Roger Bootle — advocates a return to sound money; all assume that new, national fiat currencies will float; and all assume that unproductive countries will benefit from devalued new currencies. The theory is that a devalued currency will spur export-driven economic growth. Furthermore, they have little confidence that economic reforms — which they all, by the way, do recommend — will be achieved in the near term and see devaluation as a quicker alternative. But will this work? First a word about devaluation itself.
Marc Faber: 100% Chance of Global Recession
By: Lee Brodie - CNBC.com
The stock market appears to be at a critical inflection point. That's the takeaway from widely followed economist Marc Faber, author of the Boom, Gloom & Doom newsletter.
Faber's bearish market calls have been followed closely since 1987 when he warned his clients to cash out before Black Monday.
And in a live interview on CNBC's Fast Money Halftime Report, Faber again warned that economies of the world may be on the brink of a serious slowdown.
Barry Ritholtz on the Crisis:
Causes, Cures, Corptocracy, and Suggested Reading
CapitalismWithoutFailure.com
I originally thought we were going to be talking about Wall Street today. But I got the sense from some of your book choices that one of the biggest offenders wasn't based on Wall Street at all, but on Constitution Avenue in Washington DC.
When you get bit by a dog, you don't just look at the dog, you have to look at the owner who is holding the leash.To me, a lot of the regulatory changes, and a lot of what the Federal Reserve did, stand on their own as a major factor. But if you've read David Hume, if you've studied the philosophy of causation, you have to look at what motivated those changes. I have these debates with friends. One group blames everything on big government; the other group blames everything on big corporations. The sad news is that there's really no difference between the two: Big government and big corporations work hand-in-hand. If you want to know who is the puppet and who is the puppet master, it sure looks like Wall Street has been pulling the strings of Congress for many, many, many years. I remember the Dick Durbin quote, right in the middle of the crisis. He was astonished at all the bankers and bank lobbyists running around the halls of Congress, and said, "I can't believe these guys – they act as if they own the place." The fact is, it's not an act – they do own the place.
A Tale of Two Deficits
By Matthew Feeney - Reason.com
Last week's summit in Brussels highlighted the fiscal deficits of Europe and the damage political activism will inflict on that continent's economy. Voices of caution seem to have fallen on deaf ears, and the summit has done little to reassure the markets or persuade account holders to keep cash in their accounts as millions of euros disappear from banks across the Mediterranean. While the summit might have brought to light the extent of the damage economic deficits can have, one must not forget that the political posturing we saw last week is only possible because of Europe's other crippling deficit.
U.S. hedge funds find ways to trade euro misery
CNBC.com
BOSTON/NEW YORK (Reuters) - Two decades ago, George Soros rose to fame and fortune on his now-historic trade in which he took on the Bank of England and shrewdly wagered on a devaluation of the British pound.
But it's unlikely the current European monetary crisis and worries about Greece's potential exit from the euro zone will give rise to an investing legend like Soros, who made $1 billion in 1992 by betting on a decline in the price of the pound.
Instead, there are a multitude of strategies to play Europe's troubles, and many different participants, according to U.S. hedge fund managers.
"You may call it 'nonsense' if you like," she said, "but I've heard nonsense, compared with which that would be as sensible as a dictionary!" -The Red Queen
Greece Through the Looking Glass
With all of the talk of Greece leaving the Eurozone and forfeiting the Euro as its currency; what if it does not? That, my friends, is now the question. The current estimation of Greece's GDP is $308.3 billion. All of the debt of Greece, direct, derivatives and guaranteed is $1.3 trillion giving the country an actual debt to GDP ratio of 421.67%. You may recall all of the talk, all of the pandering words spit out by the IMF and the European Union that the new austerity measures would take the Greek debt to 120%; all nonsensical and a nonfactual expression of a very fantastic and fairy tale imagination. If someone has actually stepped through the looking glass I suspect it is Christine Lagarde. Perhaps she is Alice's granddaughter? In my estimation she must have eaten some of the cake because her reputation has dwindled as she and Greece fell down the rabbit's hole.
Lloyd's of London preparing for euro collapse The chief executive of the multi-billion pound Lloyd's of London has publicly admitted that the world's leading insurance market is prepared for a collapse in the single currency and has reduced its exposure "as much as possible" to the crisis-ridden continent.
By Andrew Cave - Telegraph.co.uk
Richard Ward said the London market had put in place a contingency plan to switch euro underwriting to multi-currency settlement if Greece abandoned the euro.
In an interview with The Sunday Telegraph he also revealed that Lloyd's could have to take writedowns on its £58.9bn investment portfolio if the eurozone collapses.
The End of the Euro: A Survivor's Guide
By Simon Johnson and Peter Boone - HuffingtonPost.com
In every economic crisis there comes a moment of clarity. In Europe soon, millions of people will wake up to realize that the euro-as-we-know-it is gone. Economic chaos awaits them.
To understand why, first strip away your illusions. Europe's crisis to date is a series of supposedly "decisive" turning points that each turned out to be just another step down a steep hill. Greece's upcoming election on June 17 is another such moment. While the so-called "pro-bailout" forces may prevail in terms of parliamentary seats, some form of new currency will soon flood the streets of Athens. It is already nearly impossible to save Greek membership in the euro area: depositors flee banks, taxpayers delay tax payments, and companies postpone paying their suppliers -- either because they can't pay or because they expect soon to be able to pay in cheap drachma.
EUR Shorts Hit New Record
Submitted by Tyler Durden - ZeroHedge.com
Last week, when we reported on the then brand new record number of EUR non-commercial short contracts as reported by the CFTC, we said: "with such a massive surge in shorts in a short period of time, this means that the likelihood of major short squeezes is substantial on even the most innocuous of news, such as a G8 summit which promises much but delivers nothing, or China once again saying it will gladly focus on growth (as opposed to what? non-growth?), or some DieBold-inspired leadership change in the Greek pro/anti-bailout polls. Our advice to FX trading readers: be very careful with EURUSD stops: it is very likely that in their pursuit of short covering squeezes, (BIS) algos will take the pair substantially into the offer-side stop limit buffer just to force short hands out, which in turn may initiate short-term covering ramps." As of last Friday, the record number of net short contracts (-173.9K), just rose to a new all time high of -195.4K. The result: something as worthless and meaningless as uber-volatile Greek political polls (which had Syriza with a 4 point lead last Friday, which somehow dissolved and is now in second place about 24 hours later), was enough to send the EUR higher nearly by 100 pips overnight. Obviously, with ever more record shorts in the currency, expect the desperate continent to come up with nothing but more flashing red headlines in attempts to spook weak hands and incite even more very transitory short covering.
EU summit over, eurozone ills are not
By Raf Casert and Sarah DiLorenzo - AP - WashingtonTimes.com
BRUSSELS — European Union leaders concluded their latest summit early Thursday with few ways to cure the continent's festering financial crisis, even as the potential for a messy Greek exit from the euro appears to be rising. Some leaders stressed the importance of planning for just such an event but offered no measures that might help Greeceavoid it.
Also left unresolved was what Europe should do to spark economic growth and restore the confidence of investors, who have driven some countries' borrowing costs to unsustainable levels. The fiscal austerity agenda that Germany has pushed as the solution to Europe's problem of rising government debt has been met with skepticism in other euro countries.
Treaty sets aside Irish constitution if ratified Preparing for European treaty vote
IrishTimes.com
Sir, – There has been little or no mention of what we are being asked to vote on, viz an amendment to the Irish Constitution.
The referendum is asking us to support or oppose the addition of the following subsection to Article 29.4 of the Constitution: "The State may ratify the Treaty on Stability, Co-ordination and Governance in the Economic and Monetary Union done at Brussels on the 2nd day of March 2012. No provision of this Constitution invalidates laws enacted, acts done or measures adopted by the State that are necessitated by the obligations of the State under that Treaty or prevents laws enacted, acts done or measures adopted by bodies competent under that Treaty from having the force of law in the State."
To my layman's understanding, this clause is stating that the Irish Constitution is to be set aside when it comes to government activities conducted under the auspices of the fiscal treaty and is therefore effectively asking the Irish citizenry to suspend its own Constitution and the rule of law for any and all activities issuing from ratification of the treaty.
currency of the Fourth Reich...? One nation (under Germany) Historian Niall Ferguson tells Ben Laurance the single currency will survive and the crisis will leave Berlin heading a federal Europe
By Ben Laurance - The Sunday times - langa-rpcig.net
Where does it all end? What will be the outcome of the financial storm battering Europe and its single currency? Can the euro be saved? And if so, what will be the long-term consequences?
The financial historian Niall Ferguson, visiting London from his self-imposed exile in America to promote the paperback version of his most recent book, is typically confident that he has the answers to these difficult questions — and they are not what you might expect from this tireless proponent of free markets.
The Threat of German Amnesia
Joschka Fischer - Project-Syndicate.org
BERLIN – Europe's situation is serious – very serious. Who would have thought that British Prime Minister David Cameron would call on eurozone governments to muster the courage to create a fiscal union (with a common budget and tax policy and jointly guaranteed public debt)? And Cameron also argues that deeper political integration is the only way to stop the breakup of the euro.
A conservative British prime minister! The European house is ablaze, and Downing Street is calling for a rational and resolute response by the fire brigade.
Merkel Strikes Back Against Hollande
Submitted by Tyler Durden - ZeroHedge.com
Some thought that German chancellor Angela Merkel would quietly take the abuse heaped on her, and her program of "austerity" (or deleveraging as we call it, but that just does not have quite the negative connotations of a word that has become symbolic for all that is wrong with a massively overlevered world) by the new French president and Germany's increasingly more insolvent "partners", without much of a fuss.
Spain runs out of money
By Ambrose Evans-Pritchard - Telegraph.co.uk
El Mundo reports that the country can no longer resist the bond markets as 10-year yields flirt with 6.5pc again, and the spread over Bunds – or 'prima de riesgo' — hits a fresh record each day.
Premier Mariano Rajoy and his inner circle have allegedly accepted that Spain will have to call on Europe's EFSF bail-out fund to rescue the banking system, even though this means subjecting his country to foreign suzerainty.
Mr Rajoy denies the story, not surprisingly since it would be a devastating climb-down, and not all options are yet exhausted.
Spain Bails Out Its Third-Largest Bank Move to Pump $24 Billion Into Bankia Is Latest Step in Government's Bid to Ease Concerns About Financial Sector
By CHRISTOPHER BJORK and JONATHAN HOUSE in Madrid and SARA SCHAEFER MUOZ in London - WSJ.com $$
MADRID—Spain will pump €19 billion ($24 billion) into troubled lender Bankia SA, the bank said on Friday, effectively nationalizing the country's third-largest bank in a dramatic effort to assuage concerns about the stability of its financial sector.
Worries about Spain's banks, which are saddled with billions of euros in toxic real-estate loans, have heightened in recent weeks as Greece's political crisis has intensified and investors contemplate the effects of a potential Greek exit from the euro.
Spain's Borrowing Costs Near Danger Level: Bailout Next?
Reuters - CNBC.com
Spanish 10-year borrowing costs neared the 7 percent danger level and Bankia shares hit record lows on Monday after the government, struggling to sort out its finances, proposed putting sovereign debt into the struggling lender.
Prime Minister Mariano Rajoy pinned the blame for the rising borrowing costs—the spread over Germany reached the highest since the euro's launch—on concern about the future of the single currency.
He again ruled out seeking outside aid to revive a banking sector laid low by a property boom that has long since bust.
Spain's Rajoy fights losing battle to stave off EU rescue Spanish premier Mariano Rajoy has given a fateful hostage to fortune. He told the nation that there will no EU rescue of Spain's banking system, even as `Black Monday' brought a further crash in bank shares and the IBEX index dropped to nine-year lows.
By Ambrose Evans-Pritchard - Telegraph.co.uk
So where will he find the money to finance his €23.5bn bail-out of Bankia, a bank deemed healthy just weeks ago? The Fund for Orderly Bank Restructuring (FROB) has €5.3bn, and other banks to worry about. It would be ruinous to tap the bond markets. Spanish 10-year yields are already at danger levels of 6.4pc. The spread over German Bunds has reached a post-EMU high of 514 basis points.
Capital flight has cut foreign holdings of Spanish debt from 50pc to 37pc since January. Spain's banks -- including Bankia -- have been propping up the state with €316bn borrowed from the European Central Bank. Now the state is propping up banks. The incestuous nexus is surreal.
Greece Pours $22.6 Billion Into Four Biggest Banks
Reuters - CNBC.com
Greece handed 18 billion euros ($22.6 billion) to its four biggest banks on Monday, an official said, allowing the stricken lenders to regain access to European Central Bank funding.
The long-awaited injection—via bonds from the European Financial Stability Facility rescue fund—will boost the nearly depleted capital base of National Bank, Alpha , Eurobank and Piraeus Bank.
Greece to Leave Euro Zone on June 18: Wealth Manager
By: Shai Ahmed - CNBC Associate Editor
Greece will leave the euro zone on June 18 if the populist government wins the country's elections on the 17 as the rest of the euro zone rounds on "cheaters," Nick Dewhirst, director at wealth management firm Integral Asset Management, told CNBC.com Monday.
"The euro zone is a club but you get cheaters who get away with it until everyone finds out and at that point you need to remove them otherwise everyone will cheat. It's better for Greece to leave," Dewhirst said.
"The funds have been disbursed," an official at the Hellenic Financial Stability Facility, who declined to be named, told Reuters.
Greece financial crisis-
On the Edge with Max Keiser-05-24-2012
In this edition of the show Max interviews Karl Denninger from market-ticker.org. He talks about the finical crisis in Greece and how it will unfold in near future. Karl Denninger was the CEO of MCSNet in Chicago, one of the area's first Internet providers. He is a founding contributor to conservative blog market-ticker.org and was one of the early members of the Tea Party movement.
If Britain had joined the euro
By Jeremy Warner - Telegraph.co.uk
"Just think where we would be if Britain had joined the euro", someone recently said to me at a City lunch. There is actually a very obvious answer to this proposition – out of it.
If Britain had joined the euro, it would by now have broken the single currency beyond redemption, for it is impossible to imagine a major advanced economy tolerating the sort of nonsense which is being imposed on the highly indebted nations of the eurozone periphery.
Greece-Proofing China
By Yu Yongding - Project-Syndicate.org
BEIJING – Despite repeated assurances by European Union leaders, after more than two years, there is still no light at the end of Europe's debt-crisis tunnel. Recently, the president of the European Commission, José Manuel Barroso, referring to a possible Greek exit from the eurozone, told the European Parliament that there is no "Plan B."
Barroso's statement was meant to be reassuring. But, after so many disappointments, China cannot accept at face value the assurances of European politicians, which even they themselves do not know whether they can redeem. China should have its own Plan B in case Greece has to leave the eurozone.
Bad debt banks 'should go bankrupt'
By PAMELA DUNCAN - IrishTimes.com
RULES OF CAPITALISM: IF BANKS obey the rules of capitalism and make a bad debt they should go bankrupt, the outspoken US financial analyst and former stockbroker Max Keiser said at an event in Dublin yesterday.
"If they are capitalists they should obey the rules of capitalism; if you make a bad debt and screw up then you've got to pay the consequences. You can't go to the government and get a bailout . . . that's not capitalism, that's not even socialism, that's crapitalism," Mr Keiser said in a talk marked by black economic comedy.
The US Treasury prize, the Euro's demise,
and Facebook lies w/Paul Craig Roberts
As an informal summit of European leaders has observers seeking signs of the eurozone's direction...look at the market: German 30-year bunds tumbled to below 2 percent for the first time ever. Meanwhile, for the privilege of lending your money to the German government for 2-years you get paid a stunning...wait for it...0%. These rates aren't suppressed by QE or ZIRP like in the US. They are a fear gauge as people run to there perceive safety of Europe's largest and strongest economy.
And according to media reports the guessing game is underway for who will replace Timothy Geithner as US Treasury Secretary. You may be asking yourself why anyone would want to try and tackle the trillion dollar budget deficit, overhaul the tax structure and catch flack for a flailing economic recovery for a salary 115 times less than their private sector equivalent of Jamie Dimon. So are we. We'll ask former assistant secretary of the treasury, Paul Craig Roberts if he thinks that this public service is actually a private gain...a one-way ticket to a massive private sector payoff.
Also, in the wake of Facebook's flop of an IP, we see small investors suing, regulators subpoenaing, and US lawmakers searching for answers. Retail investors for one, are asking if they were fleeced.
• You have a profile picture;
• You spend a lot of your time there writing on walls;
• Insiders desperately want out; and
• You're constantly worried about being 'poked' by people you don't know.
Of course, with over 900 million monthly users, FacebookFB -3.39% is a prison that apparently people are mostly trying to break into, not out of.
A couple of weeks ago (pre-IPO), I wrote how Mark Zuckerberg needed to stop worrying about Wall Street and just keep the world at large informed of his plans for the company. The future would take care of itself. Of course, that was before Wall Street, in the form of Facebook's lead underwriter Morgan Stanley MS -0.45%and the Nasdaq Stock Market, messed up Facebook's IPO.
OK, Zuck, maybe your antipathy to going public wasn't so naive after all.
Keiser Report: Reform = Crime
To Favor Wall St. Crooks (E293)
In this episode, Max Keiser and co-host, Stacy Herbert, discuss the 99% knocking on Timmy Geithner's door looking for 'reform' of criminal behavior. In the second half of the show Max talks to independent video journalist, Luke Rudkowski, about livestreaming to the world from a smartphone and his recent work covering the NATO summit in Chicago.
Ally Financial: Newly Released Letter
Show Scope Of Possible Mortgage Screwups
By Ben Hallman - HuffingtonPost.com
Trying to count the number of bank screwups during the foreclosure crisis is a little like guessing the amount of change in a huge jar: You can see that the answer is "an awful lot," but without breaking the jar and counting by hand, there's no way to know for sure.
On Thursday, however, just how much homeowner misery Ally Financial may be responsible for came to light after the Federal Reserve released a letter that details exactly how many borrowers' cases may have been mishandled.
Arizona Sheriff Not Backing Down On Obama Birth Issue Unimpressed with state's announcement on presidential Ballot
By Steve Watson - Infowars.com
Sheriff Joe Arpaio of Arizona, the man leading an investigation into the eligibility of the president, says he will not back down on the birther issue despite last week's attempts by Arizona Secretary of State Ken Bennett to lay the controversy to rest.
Bennett said he was happy that an email from officials in Hawaii sent to him last week "proves President Obama's American birth and satisfies Arizona's requirements for having the president on the upcoming election ballot."
The Provenance of Barack Obama with Dr. Jerome Corsi
Dr. Jerome Corsi talks with Alex on the Thursday, May 24 edition of the Alex Jones Show. Corsi talks about the latest on the Obama Kenya birth story, including a threat by Arizona to strike Obama from the ballot this November if the issue cannot be resolved. Corsi is the author of Where's the Birth Certificate?: The Case that Barack Obama is not Eligible to be President, Saul Alinsky:The Evil Genius Behind Obama and The Obama Nation.
How Nasdaq Lost Control of Facebook IPO, by the Minute
Reuters - CNBC.com
Dead silence.
For nearly 20 minutes on the morning of Facebook's trading debut last Friday, the line Nasdaq had opened up to keep traders informed about the social media company's $16 billion IPO had been mute.
Well after the stock was supposed to have opened at 11 a.m. New York time, no one from Nasdaq was talking—and there was still no sign of trading.
Finally, at 11:28 a.m., an unidentified person announced that the shares would open in about 2 minutes.
Nasdaq also said orders and cancellations were still being processed, according to several sources listening to the call.
College dropouts have debt but no degree
By Ylan Q. Mui and Suzy Khimm - WashingtonPost.com
As the nation amasses more than $1 trillion in student loans, education experts say a vexing new problem has emerged: A growing number of young people have a mountain of debt but no degree to show for it.
Nearly 30 percent of college students who took out loans dropped out of school, up from fewer than a quarter of students a decade ago, according to a recent analysis of government data by think tank Education Sector. College dropouts are also among the most likely to default on their loans, falling behind at a rate four times that of graduates.
A New Look at the 'New Poor'
By: Michael S. Barr - CNBC contributor
These are tough times for most American households.
The financial crisis wiped out savings and home equity, cut millions of jobs, and shuttered businesses. And the financial system often seems to benefit the wealthy while providing little solace to the broad middle of our country.
For those further down the income scale, the financial system often does even worse—with banks often shunning low-income clientele or charging high overdraft and other fees, and prepaid debit cards, a potential alternative to bank accounts for some individuals, often loaded up with hidden and high cost fees themselves.
Saying goodbye to the middle class concept of retirement – many workers plan to work up until they are 80
well beyond the typical life expectancy of Americans.
How long will $25,000 last in retirement?
MyBudget360.com
The romantic concept of being able to retire on a sunny beach with endless drinks is a modern notion largely pushed by mainstream advertising. It is hard for manymiddle class Americans to imagine a world where retirement is a luxury for the very few. However that is the path we are now following. The ability to retire is being severely impaired for most Americans given their lack of savings but also the massive spending occurring by the government. Recently we have heard that Social Security is expected to run out of funding far quicker than was once expected. This information in itself is troubling but couple that with the incredibly low to non-existent savings rate for younger Americans and you realize the day of reckoning that is lining up. Even recent data has looked at pushing the retirement age from 65 to 80 for some workers which might be hard to do given it is beyond the normal life expectancy of most Americans. The new retirement model appears to be no retirement.
Federal Rules Threaten to Suffocate the Fracking Industry
By Gary Hunt - OilPrice.com
In Medieval times one form of dispatching miscreants was called "pressing". The punishment involved piling stones on top of the offender one at a time slowly suffocating him from the weight on his chest. Not only did this rid the kingdom of troublemakers but it had a "crucify him" like effect on the gathered witnesses lest they forget who is in charge.
Fast forward and today we are seeing Federal agency after agency pressing forward with new rules on hydraulic fracturing:
Are Republicans Bending On 'Obamacare'?
By SAHIL KAPUR - TalkingPointsMemo.com
As the landmark Supreme Court decision looms next month, Republicans have been privately considering a plan to reinstate some popular provisions of "Obamacare" if it's struck down.
The revelation sent conservative advocates — who have demanded nothing less than total repeal — into a tizzy, which forced House Speaker John Boehner (R-OH) to reaffirm his commitment to "repealing Obamacare in its entirety," declaring that "[a]nything short of that is unacceptable."
Anarchist Group Allied to CIA's Red Brigades
Plan London Olympics Terror
By Kurt Nimmo - Infowars.com
An anarchist group is threatening to disrupt the London Olympics with terrorist attacks. The Informal Anarchist Federation (or FAI, Federazione Anarchica Informale) warns it will engage in "guerrilla activity to hurt the national image and paralyze the economy however we can," according to a post on the anarchist website 325.nostate.
The group claims it will target the Ministry of Defense, defense firms, and banks in Britain. "Finance, judicial, communications, military and transport infrastructure will continue to be targets of the new generation of urban low-intensity warfare."
'Vatileaks' scandal widens
as pope's butler vows to help investigators Paolo Gabriele says he will co-operate
over confidential documents allegedly found at his home
AP - Guardian.co.uk
One of the Vatican's biggest scandals in decades has widened, with the pope's butler agreeing to co-operate with investigators over confidential documents allegedly found at his home, according to his lawyer.
Paolo Gabriele's pledge to co-operate with Vatican magistrates means high-ranking prelates could soon be named in the investigation into leaks of confidential Vatican correspondence that have shed a light on power struggles and intrigue at the highest levels of the Catholic church.
* * * * *
Ancient Roots of Bilderberg Reveal Prusso-
Teutonic Agenda for World Domination
By Jurriaan Maessen - ExplosiveReports.Com
Just a few days from now, the world's economic, political and scientific elites (not to mention top media kingpins) will gather near Chantilly, Virginia to fine-tune an agenda that's been long in the making. Its roots reach so far down in the soil of history, we'll have to roll up our sleeves before we descend. An Unholy Alliance
In 1943, while Europe was blindfolded by terror and death, a book was published by Charles Scribner's Sons which carried the title The Thousand Year Conspiracy (part I & part II). In the book, the author Paul Winkler offers a fascinating insight into the people who are in the business of engineering financial crises and wars in Prussia from its very conception way back in the dark ages. In order to acquire at least some understanding about the origin and significance of this "Prusso-Teutonic" establishment, as Winkler calls it, let us follow the author down the ladder into his deep research. You may argue that the hour is late, producing a "review" of a book published well over 65 years ago, but the obscurity in which the book lay hidden all that time and its relevance to our own day, I think justifies an attempt. Pulled from underneath a large stack of wartime literature, cleared from a thick layer of dust, The Thousand Year Conspiracy should raise some eyebrows- not to say make you fall from your chair in sheer amazement. Around the time the book hit the stores in the U.S., few people understood the full implication of this manuscript. At that time all eyes were transfixed on the Fuhrer, who was barking a continuous stream of orders at trembling generals.
UN's 2012 "Earth Summit"
Moves To Disembowel Sovereignty,
Impose Absolute Rule
By Jurriaan Maessen - ExplosiveReports.Com
In the run up to the next Earth Summit to be held in Rio in June of this year, the global leviathan that is the United Nations bares its teeth. A continuing stream of publications is pouring down from every corner of the transnational community, in essence calling for global governance of the environment as well as a stark reduction in the global human population. These two items are very much intertwined, according to the growing pile of UN papers flying from the supranational tree, all basically stating that the first is necessary in order to facilitate the latter.
One of these leaves circles down to us from the United Nations Environmental Programme (UNEP) displays a collection of "key messages" written by the usual suspects, such as dedicated man-hater Paul Ehrlich, eco-terrorist James Lovelockand NASA's own mad-as-hell environmentalist James Hansen. Their joint statement titled "Environment and Development Challenges: The Imperative to Act" was clearly designed to inspire the UN and its upcoming confab to make haste with global government. In their manifesto the impatient fiends call for a global implementation of population policies and rights being trampled upon in order to address what they call "the population issue":
A Deadly Secret Plot Has Been Uncovered The plot is fulfilling a great Bible prophecy. It's all about the European Union superpower being hijacked!
BY GERALD FLURRY - TheTrumpet.com
We have been prophesying for over 70 years that a strong dictator is about to rule over Europe. We proclaimed that he would not be voted in by the public. We have also said for many years Britain would not be a part of the final European Union.
A recently revealed secret plot shows that all of these prophecies are being fulfilled now!
The British Express printed an article on May 4 titled, "EU Plot to Scrap Britain." "Senior Eurocrats are secretly plotting to create a super-powerful EU president to realize their dream of abolishing Britain, we can reveal," it began.
....This resurrected Holy Roman Empire is going to be the most destructive force ever on Earth. It is time for this world to understand what is happening in Europe!
FBI Secretly Creates Internet Police
Russia Today - LewRockwell.com
The FBI was rather public with its recent demands for backdoor access to websites and Internet services across the board, but as the agency awaits those secret surveillance powers, they're working on their own end to have those e-spy capabilities.
Not much has been revealed about one of the Federal Bureau of Investigation's newest projects, the Domestic Communications Assistance Center, and the FBI will probably try to keep it that way. Despite attempting to keep the DCAC largely under wraps, an investigation spearheaded by CNET's Declan McCullagh is quickly collecting details about the agency's latest endeavor.
Computer worm that hit Iran oil terminals 'is most complex yet' Experts warn W32.Flamer may have been developed by a nation state as part of cyberwarfare activities
By Nick Hopkins - Guardian.co.uk
A cyber-attack that targeted Iran's oil ministry and main export terminal was caused by the most sophisticated computer worm yet developed, experts have warned.
The virus appears to have been directed primarily at a small number of organisations and individuals in Iran, the West Bank, Lebanon and the United Arab Emirates. This will inevitably raise suspicions that Israel or the US were involved in some way.
Meet 'Flame', The Massive Spy Malware
Infiltrating Iranian Computers
By Kim Zetter - Wired.com
A massive, highly sophisticated piece of malware has been newly found infecting systems in Iran and elsewhere and is believed to be part of a well-coordinated, ongoing, state-run cyberespionage operation.
The malware, discovered by Russia-based anti-virus firm Kaspersky Lab, is an espionage toolkit that has been infecting targeted systems in Iran, Lebanon, Syria, Sudan, the Israeli Occupied Territories and other countries in the Middle East and North Africa for at least two years.
Dubbed "Flame" by Kaspersky, the malicious code dwarfs Stuxnet in size – the groundbreaking infrastructure-sabotaging malware that is believed to have wreaked havoc on Iran's nuclear program in 2009 and 2010. Although Flame has both a different purpose and composition than Stuxnet, and appears to have been written by different programmers, its complexity, the geographic scope of its infections and its behavior indicate strongly that a nation-state is behind Flame, rather than common cyber-criminals — marking it as yet another tool in the growing arsenal of cyberweaponry.
Underground Pipe has been Leaking Jet Fuel
for 40 Years at US Air Force Base
By Charles Kennedy - OilPrice.com
Jet fuel from the Kirtland Air Force Base in Albuquerque has been leaking from 40 years. The leak was first discovered in 1999, and so far 400,000 gallons of fuel have been removed from the area, and efforts to aggressively clean up the problem will continue.
State geologist William Moats initially calculated the spill at about 8 million gallons, but after reviewing new data from Air Force monitoring wells he has upped his estimate to 24 million gallons, but has also said that the true extent of the spill can be verified until it has been remediated.
Illegal kidney trade booms as new organ is 'sold every hour' World Health Organisation estimates 10,000 black market operations involving human organs take place each year
By Denis Campbell and Nicola Davison in Shanghai - Guardian.co.uk
The illegal trade in kidneys has risen to such a level that an estimated 10,000 black market operations involving purchased human organs now take place annually, or more than one an hour, World Health Organisationexperts have revealed.
Evidence collected by a worldwide network of doctors shows that traffickers are defying laws intended to curtail their activities and are cashing in on rising international demand for replacement kidneys driven by the increase in diabetes and other diseases.
Nuclear Denial and the Resignation of Gregory Jaczko Meltdown at the Nuclear Regulatory Commission
by KARL GROSSMAN - CounterPunch.org
The resignation last week of the chairman of the U.S. Nuclear Regulatory Commission is another demonstration of the bankrupt basis of the NRC. Gregory Jaczko repeatedly called for the NRC to apply "lessons learned" from the Fukushima Daiichi nuclear plant disaster in Japan. And, for that, the nuclear industry—quite successfully—went after him fiercely.
The New York Times in an editorial over the weekend said that President Obama's choice to replace Jaczko, Allison McFarlane, "will need to be as independent and aggressive as Dr. Jaczko."
That misses the institutional point.
Obama paving the way for Iran attack? The National Attack Authorization Act?
By John Aziz, guest - ZeroHedge.com
We all know that the National Defense Authorization Act (NDAA) signed by President Obama on New Year's Eve contained a now-struck-down provision to authorise the indefinite detention of American citizens on US soil.
But did you know that the NDAA also paves the way for war with Iran? From Dennis Kucinich:
Section (6) rejects any United States policy that would rely on efforts to contain a nuclear weapons-capable Iran. Section (7) urges the President to reaffirm the unacceptability of an Iran with nuclear-weapons capability and opposition to any policy that would rely on containment as an option in response to Iranian enrichment.
Ron Paul Dissents on House Bill for Unlimited Military Aid
for Israel, Shows Why He's a True Leader
by Hamdan Azhar - LewRockwell.com
Earlier this month, the U.S. House of Representatives quietly passed a bill that critics insist effectively guarantees unlimited military aid to the government of Israel. HR 4133, dubbed the "United States-Israel Enhanced Security Cooperation Act of 2012," makes it "the policy of the United States to help Israel preserve its qualitative military edge" and "to provide Israel the military capabilities necessary to deter and defend itself by itself against any threats."
The bill passed by a vote of 411-2 with 9 members voting "present." The two "No" votes were cast by Texas Congressman and Republican presidential candidate Ron Paul and Congressman John Dingell (D-MI), former Chairman of the House Energy and Commerce Committee and the longest currently serving member of Congress.
Signing US strategic pact:
end of peace in Afghanistan: former PM
Afghan lawmakers' approval of US presence in the country is a "tragedy for the whole Afghan nation," as it means that the war-torn country will not find peace at least for another decade, an analyst says.
Interview with former Afghan Prime Minister, Ahmad Shah Ahmadzai
Houla massacre: US military warns Syria
as pressure builds on Obama Top US general urges increased diplomatic pressure on Bashar al-Assad but warns military is prepared to act if necessary
By Chris McGreal in Washington - Guardian.co.uk
The US's top military officer has warned Syria it could face armed intervention as international outrage grows over the massacre of women and children by tanks and artillery in Houla.
General Martin Dempsey, the chairman of the joint chiefs of staff, said that following the UN security council's condemnation of the slaughter – in which more than 100 people were killed, many of them children – there needed to be increased diplomatic pressure on Damascus. But he added that the US would be prepared to act militarily if it was "asked to do so".
Kofi Annan tells Syria bold steps needed after Houla massacre 'Those responsible for these brutal crimes must be held accountable', Bashar al-Assad's regime told
By Ian Black, Middle East editor,
and Miriam Elder in Moscow - Guardian.co.uk
Kofi Annan faces tough talks in Damascus on Tuesday after condemning the "appalling crime" of the killing of 108 people, including 32 children in the Syrian town of Houla. But there was no sign that President Bashar al-Assad's closest ally, Russia, was preparing to significantly shift position.
Annan, representing the UN and the Arab League, said on arrival in the Syrian capital of Damascus on Monday that he was "shocked and horrified by the tragic incident".
Memorial Day 2012
PTG and U.S. markets closed Monday for holiday
Franchitti wins 3rd Indianapolis 500
By Steve Gelsi, MarketWatch
NEW YORK (MarketWatch) — Dario Franchitti won his third Indianapolis 500 race on Sunday in a contest in 90-degree heat that produced a record 35 lead changes.
Franchitti, who started the day in the 16th slot, gained ground on the competition and held off a challenge in the final lap from Takuma Sato, who spun out as he tried to take the lead, to win the race under a yellow caution flag.
Franchitti also won under yellow flags at Indianapolis in 2007 and 2010.
The meaning behind Rolling Thunder
Rolling Thunder isn't a biker gang or a club. It's an organization that supports POW/MIA families while embracing the service that veterans and active duty military have provided to the country. This year marks the 25th anniversary of the Rolling Thunder movement.
USAA 2012 Memorial Day Ceremony - Courage to Persevere
The USAA's 2012 Memorial Day program starts with a a moving scene with Marine veteran SSgt Tim Chambers at attention in his dress blues, saluting during the "Rolling Thunder" parade in Washington D.C. for the tenth year . . . and doing so voluntarily. Highlights also include inspiring performances of patriotic songs by Angie Johnson, a contestant on The Voice and former Tops in Blue performer; and, country music artist Russ Murphy.
Washington's Hypocrisies
By Paul Craig Roberts - PaulCraigRoberts.org
he US government is the second worst human rights abuser on the planet and the sole enabler of the worst–Israel. But this doesn't hamper Washington from pointing the finger elsewhere.
The US State Department's "human rights report" focuses its ire on Iran and Syria, two countries whose real sin is their independence from Washington, and on the bogyman- in-the-making–China, the country selected for the role of Washington's new Cold War enemy.
Hillary Clinton, another in a long line of unqualified Secretaries of State, informed "governments around the world: we are watching, and we are holding you accountable," only we are not holding ourselves accountable or Washington's allies like Bahrain, Saudi Arabia, Israel, and the NATO puppets.
"We will bankrupt ourselves in the vain search for absolute security." -Dwight D. Eisenhower
"How far can you go without destroying from within what you are trying to defend from without?" -Dwight D. Eisenhower
Generals gathered in their masses
Just like witches at black masses
Evil minds that plot destruction
Sorcerers of deaths construction
In the fields the bodies burning
As the war machine keeps turning
Death and hatred to mankind
Poisoning their brainwashed minds, oh lord yeah!
Black Sabbath – War Pigs
As Americans mindlessly celebrate another Memorial Day with cookouts, beer and burgers, the U.S. war machine keeps churning. As we brutally enforce our will on foreign countries, we create more people that hate us. They don't hate us for our freedom. They hate us because we have invaded and occupied their countries. They hate us because we kill innocent people with predator drones. They hate us for our hypocrisy regarding democracy and freedom. Just when we had the opportunity to make a sensible decision by leaving Iraq and exiting the Middle East quagmire, Obama made the abysmal choice to casually sacrifice more troops in the Afghan shithole. We have thrown over $1.3 trillion down Middle East rat holes over the last 11 years with no discernible benefit to the citizens of the United States. George Bush and Barack Obama did this to prove they were true statesmen. The Soviet Union killed over 1 million Afghans, while driving another 5 million out of the country and retreated as a bankrupted and defeated shell after ten years. Young Americans continue to die, for whom and for what? Our foreign policy during the last eleven years can be summed up in one military term, SNAFU – Situation Normal All F--ked Up. These endless foreign interventions under the guise of a War on Terror are a smoke screen for what is really going on in this country. When a government has unsolvable domestic problems, they try to distract the willfully ignorant masses by proactively creating foreign conflicts based upon false pretenses. General Douglas MacArthur understood this danger to our liberty.
How did we come to be such idiots?
By Walter Allen Thompson
"Why does he act like such an idiot?"
How many times do we ask that question about other people—even about ourselves? There is no shortage of idiots and they are the primary reason it is so difficult (if not impossible) to live on Earth in peace and truth.
....Most governments have failed because they were run by idiots with no regard for God's commandments.
Religions of the world with doctrines other than that which God has promulgated are not valid and will suffer the same fate as failed governments and for the same reasons.
Our problems today arise from people calling upon idols or false gods for answers. We turn to our enemies as if they are our friends. We look to idiots as if they are wise. We treat idiots with honor and treat the wise with contempt. We turn to darkness and live as if it were light. We call upon ruthless idiots to do good when we should know they are incapable of it. The idiots have the authority on earth because we, the idiots, gave it to them.
BORDERLINE TYRANNY Right and left are both fighting
to restrict our freedom of movement
By Shikha Dalmia - TheDaily.com
If there was ever any doubt that the totalitarian temptation identified by economist and Nobel laureate F.A. Hayek in his brilliant tract, "The Road to Serfdom," is alive and well (even in the sweet land of liberty), two current crusades of the left and the right ought to put it to rest.
The restrictionist right is deploying ever more draconian methods to chase prospective Americans out of the country, including imposing what some call a "business death penalty." And the tax-and-spend left is devising ever more punitive ways to prevent existing Americans from leaving the country, including imposing a rather ominous exit tax.
Illegalities Calling Out the CFTC On Silver Market Manipulation
By Theodore Butler - SilverSeek.com
The Commodity Futures Trading Commission (CFTC) has been negligent in failing to terminate the obvious manipulation ongoing in silver. Furthermore, the agency may be complicit in this manipulation. Worse, it has lied to the public and elected officials. This all goes back to the time when Bear Stearns was taken over by JPMorgan in March of 2008. It is well known that Bear Stearns went under as a result of a sudden loss of liquidity amidst a run by creditors and customers. What is not well known is that those problems were greatly exacerbated by a $2 billion margin call on silver and gold short positions from the end of December 2007 to March 2008. I believe the silver and gold margin calls were at the heart of Bear Stearns' failure.
Welcome to the Currency War, Part 1:
Iceland and the Tragedy of the Commons
By: John Rubino - SafeHaven.com
Think of devaluation as the monetary equivalent of the "tragedy of the commons". In a nutshell, if everyone owns something, it is in each individual's interest to grab what they can as quickly as possible, which soon depletes the resource.
With currency exchange rates, as with fisheries and sheep pastures, there's an advantage for those who move first and pain for those who dither. Consider Iceland's nearly-instantaneous recovery from its epic banking crash:
Europe's Maquina Infernal has crippled Spain Spain is spiralling into the vortex of debt-deflation. This has nothing to do with Greece. It is not the result of fiscal extravagance over the past decade, or other such Wagnerian myths.
By Ambrose Evans-Pritchard - Telegraph.co.uk
The country's collapse is the mathematically certain - and widely predicted - result of ferocious monetary and fiscal contraction on an economy struggling to deal with a housing bust.
Monetary tightening by the European Central Bank caused Spanish real M1 deposits to fall at an 8pc rate in mid-to-late 2011, guaranteeing the crash into double-dip recession that we now see.
For the eurozone, the worst is yet to come This euro crisis is now getting extremely serious. Events are happening quickly, closing-in on policy-makers and threatening to engulf us.
By Liam Halligan - Telegraph.co.uk
Across the single currency zone, fears are rising and, even in the most moderate nations, populations are becoming more restive. History is locked on fast-forward.
Some say that seemingly arcane economic policy debate doesn't matter. In the UK, in particular, but across much of the rest of Western Europe too, the political and media classes have long displayed a tendency to roll their eyes whenever anybody with even a smattering of economic insight has had the audacity to show it.
Germany to the Euro: Drop Dead
By Matthew O'Brien - TheAtlantic.com
Fixing the euro crisis isn't that difficult -- at least in theory. In the long run, Europe needs a common treasury to make the common currency work. And in the short run, Europe needs Germany to start paying its workers more.
But neither of these is politically possible. So round and round we go.
Let's back up for a minute. Why do German workers need a raise? The chart below, via Business Insider, shows unit labor costs across Europe since the euro was introduced. It's been a lost decade for German workers.
What Would Greek Exit Mean for the US Economy?
By Reuters via CNBC.com
Uncertainty over the fate of the euro currency is already dampening U.S. economic growth and any significant worsening of the crisis would deal a blow to a recovery that is gradually gathering steam.
Economists estimate that volatile markets and business uncertainty over the fate of Greece and the policy course in Europe is already shaving anywhere from one tenth to one half a percentage point from U.S. 2012 gross domestic product growth.
Ireland's Moment of Fiscal Decision
By Lucinda Creighton - Project-Syndicate.org
DUBLIN – "The construction of Europe is an art," former French President Jacques Chirac once said. "It is the art of the possible." If so, then Europe's deconstruction – or, worse, its collapse – would be a shockingly fearful and painful business.
That was the situation faced by European leaders last autumn. The euro was in serious trouble, buffeted by rumors of imminent banking collapses. Bond yields in southern Europe were rising, and a pervasive sense of apprehension and fear cloaked governments in European capitals. But political leadership was sorely lacking.
Regulators Close Two Banks;
US Bank Closures Reach 15 In 2012
NASDAQ.com
(RTTNews.com) - The Federal Deposit Insurance Corp. or FDIC, announced Friday the shuttering of two small banks, one each in the states of Georgia and Illinois, taking the count of U.S. bankclosures in 2012 to 15, after 92 in 2011 and the 157 bank closures in 2010. The closures are the fourth in the state of Georgia and the third in Illinois.
Fed's Plosser warns on discretionary policy decisions
By Eva Kuehnen
(Reuters) - The debate over how the Federal Reserve can best articulate its policy actions grew on Friday as a top Fed official warned against discretionary decisions, and asked whether a more systematic approach was desirable.
Philadelphia Fed President Charles Plosser said the financial crisis has tied the hands of many central banks, including the Fed, creating a "conundrum" of near-zero interest rates and a search for new and untested ways to boost economies.
Breaking up Chase: Good for shareholders and taxpayers Jamie Dimon needs to take a cue from J.P. Morgan's trading debacle and divide the banking giant into manageable pieces.
By Sheila Bair - Fortune.com
FORTUNE – When I was a child, my sister and I loved watching the goings-on at a chicken farm near my grandmother's house in rural Kansas. Chickens are interesting social animals, resembling, somewhat, the way we in Washington interact with one another. They were always on the lookout for one vulnerable bird that they would corner in the coop and then peck relentlessly on its head.
Jamie Dimon, the CEO of J.P. Morgan Chase (JPM), is getting his head pecked these days. To be sure, he set himself up for it by very publicly leading the industry chorus of criticism against key financial reforms. He has made many good decisions for his bank, but Chase's recent serious missteps have provided reform advocates with loads of ammunition. I mean, really. Losing $2 billion (and counting) by "hedging" a bond portfolio against losses? What were he and his minions thinking? If Dimon wants to regain his place in the pecking order, he should take the initiative and shrink Chase to a manageable size.
Wall Street Wants Congress
To Roll Back Financial Derivatives Regulations Nine bills are before lawmakers to undo reforms passed after the financial crash of 2008.
By Taylor Lincoln - AlterNet.org
Revisiting the lessons from deregulating derivatives is particularly important right now because Congress seems to have forgotten them. A report we just issued provides a road map of how derivatives wrecked the economy in 2008 and could do so again if Wall Street gets its way.
Nine bills that would roll back the derivatives reforms created in the wake of the financial crisis are moving in Congress. These proposals, most of which have already passed in committee, have been put forth in the name of furthering the competitiveness of U.S. companies and creating jobs for Main Street. These are quite brazen claims, since deregulating derivatives arguably did more to harm economic competitiveness and job creation than anything Congress has done for a very long time.
How Boaz Weinstein and Hedge Funds Outsmarted JPMorgan
By Azam Ajmed - CNBC.com
Boaz Weinstein didn't know it, but he had just hooked the London Whale.
It was last November, and Mr. Weinstein, a wunderkind of the New York hedge fund world, had spied something strange across the Atlantic. In an obscure corner of the financial markets, prices seemed out of whack. It didn't make sense.
Mr. Weinstein pounced.
As the financial world now knows, what was out of whack was JPMorgan Chase & Company. One its traders, Bruno Iksil, the man later nicknamed the London Whale for his outsize trades, was about to blow a multibillion-dollar hole in the mighty House of Morgan.
JPMorgan's debacle, and its parallels to AIG
By Barry Ritholtz - Ritholtz.com
Last week, the once-future Treasury secretary and current JPMorgan Chase CEO Jamie Dimon revealed a $2 billion loss. This previously undisclosed derivative trade should be a wake-up call for those claiming that finance has been "reined in" and no longer presents a threat to the global economy.
As it turns out, nothing could be further from the truth.
Finance has become a low-margin, high-leverage business. This is not surprising in an environment in which trading volumes are exceedingly low and interest rates even lower. In any other industry, a slowdown in economic activity sends management scurrying to cut costs, develop new products, become more productive. In short, to innovate. Companies can throw money at new products, marketing campaigns or discounted pricing, but a slowing economy brings down demand. What we have today is a deleveraging economy, and that is even more challenging — limiting the options that CEOs can take to increase their company revenue.
IPO stands for 'it's probably overpriced' One big lesson from Facebook: Don't buy new stocks
By Chuck Jaffe, MarketWatch
BOSTON (MarketWatch)—In the past few days, thanks to the initial public offering of Facebook, investors have learned what the letters IPO really stand for: "It's probably overpriced."
Truthfully, the initial public offering process is built and managed to give a predictable pop on opening day, which results in an equally predictable fallback later, which is why chasing after any initial public offering is the Stupid Investment of the Week.
What the Facebook Fiasco
Tells Us About Our Rigged Stock Market How long will we keep getting Zuckered?
By Lynn Parramore - AlterNet.org
In the wake of the JP Morgan blow-up and the Facebook debacle, Americans are contemplating the stock market with a mixture of alarm and disgust. Both are justified. In world of high-speed trading and other manipulations, the ordinary investor who wants to make money over the long haul can easily get screwed by those playing a short-term game.
On May 18, Facebook went public to relentless mainstream media cheers. As of Thursday, May 24, the stock was down 15 percent of the initial offering of $38 per share. The Internet bubble of 1998-2000 gave us a brutal lesson in what happens when investors shell out gigantic sums for unproven companies. But never mind. Those "rational" creatures neoliberal economists are always going on about -- you know, the kind that operate on "perfect information" -- did what actual humans tend to do. They got overly excited, followed the herd and found out that their information was far from perfect.
Wall Street gets behind the Olympic games High-profile financiers
are stepping in to support future Olympians.
By Katie Benner - Fortune.CNN.com
FORTUNE -- The U.S. Olympic Committee needed a better way to raise money. Until recently, direct mail -- the USOC's primary source of private donations -- yields on average a $20 gift from those who donated. "We were raising less in private contributions than the Cheyenne Mountain Zoo in Colorado Springs," says Patrick Sandusky, a spokesman for the USOC.
To bring in major gifts, the kind of six and seven figure checks that are the lifeblood of most non-profit organizations, the USOC created a contribution-based board of trustees in 2010. Trustees commit $300,000 over a four-year term, as well as the time and energy necessary to host events and raise money. High profile Wall Streeters including Dan Loeb of Third Point and Rick Rieder of BlackRock have volunteered. "The Olympics is about national pride and, at the same time, global unity," says Kevin White, the founder of Spring Hill Capital and one of the USOC's original trustees. "Never in my adult life, have I seen the nation or the world so polarized. But the world will put that aside during the games, and that's a remarkable feat."
Postal Service Offers Buyouts to 45,000 Mail Handlers
By RON NIXON - NYTimes.com
The United States Postal Service said late Friday that it was offering buyouts to about 45,000 mail handlers, part of the financially troubled agency's efforts to cut its staff and reduce its operating costs.
The mail handlers, who work in processing centers, will be offered $15,000 each. The Postal Service has said it will close 48 of the centers starting this summer, reducing the need for staff.
Full-time mail handlers wanting to sign up for the buyouts must do so by July 2 and agree to leave or retire by Aug. 31, according to the agreement reached between the Postal Service and the National Postal Mail Handlers Union. Part-time handlers have until July 16 to make a decision.
The Terrible Truth About Facebook
Think you have any privacy when it comes to a social networking site? Think again. Just take a look at who has invested in the site and open your eyes.
The next Japanese nuclear accident
(it's inevitable) will be even worse
By Robert Cringely - Cringely.com
This is my sixth column about the Fukushima Daiichi nuclear accident that started last year in Japan following the tsunami. But unlike those previous columns (1,2,3,4,5), this one looks forward to the next Japanese nuclear accident, which will probably take place at the same location. That accident, involving nuclear fuel rods, is virtually inevitable, most likely preventable, and the fact that it won't be prevented comes down solely to Japanese government and Tokyo Electric Power Company (TEPCO) incompetence and stupidity. Japanese citizens will probably die unnecessarily because the way things are done at the top in Japan is completely screwed up.
Understand that I have some cred in this space having worked three decades ago as an investigator for the Presidential Commission on the Accident at Three Mile Island and later wrote a book about that accident. I also ran for 20 years a technology consulting business in Japan.
A Liberal Squeeze Play
By George Will - PatriotPost.us
WASHINGTON -- In one of his characteristic conniptions about people who frustrated him, Theodore Roosevelt, progressivism's first president, said of Justice Oliver Wendell Holmes, "I could carve out of a banana a judge with more backbone than that." TR was as mistaken about Holmes' spine as are various progressives today about Chief Justice John Roberts'.
They are waging an embarrassingly obvious campaign, hoping he will buckle beneath the pressure of their disapproval and declare Obamacare constitutional. The crucial question is whether Congress exceeded its enumerated power to regulate interstate commerce when it mandated that individuals engage in commerce by purchasing health insurance.
Turn Out The Lights -
The Largest U.S. Cities Are Becoming Cesspools
Of Filth, Decay And Wretchedness
TheEconomicCollapseBlog.com
Once upon a time, the largest U.S. cities were the envy of the entire world. Sadly, that is no longer the case. Sure, there are areas of New York City, Boston, Washington and Los Angeles that are still absolutely beautiful but for the most part our major cities are rapidly rotting and decaying. Cities such as Detroit, Cleveland, Baltimore, Memphis, New Orleans, St. Louis and Oakland were all once places where middle class American workers thrived and raised their families. Today, all of those cities are rapidly being transformed into cesspools of filth, decay and wretchedness. Millions of good jobs have left our major cities in recent decades and poverty has absolutely exploded. Basically, you can turn out the lights because the party is over. In fact, some major U.S. cities are literally turning out the lights. In Detroit, about 40 percent of the streetlights are already broken and the city cannot afford to repair them. So Mayor Bing has come up with a plan to cut the number of operating streetlights almost in half and leave vast sections of the city totally in the dark at night. I wonder what that will do to the crime rate in the city. But don't look down on Detroit too much, because what is happening in Detroit will be happening where you live soon enough.
Farmers hit the jackpot in Kansas oil boom Farmer power forces Big Oil bidding war
By Blake Ellis @CNNMoney
HARPER COUNTY, Kan. (CNNMoney) -- Farmers in Kansas are hitting the jackpot.
But instead of holding the winning lottery numbers, it's all about owning the right piece of land.
In Harper County, Kan., and the surrounding areas along the south central border of the state, oil companies are pinpointing plots of land they think will become drilling hotspots and offering farmers up to $1,250 an acre for the mineral rights that allow them to drill there.
Only a year ago, these same rights were worth about $25 an acre, said Gordon Stull, a lawyer in the town of Pratt, who helps clients negotiate mineral right leases.
Mortgage Delinquencies Rise Slightly in April
247WallSt.com
The monthly mortgage report for April was released today by Freddie Mac. The report notes a rise of just 0.01% in delinquent mortgage payments for single-family homes and a rise of 0.03% on mortgages for multi-family homes. The April delinquency rate for single-family homes is 2.81%. For multi-family homes the rate is 3.51%.
America's middle-class tax morality If you listen closely to people's 'tax talk', what you hear is not Tea Party extremism but legitimate anxiety from the squeezed centre
By Jeffrey Kidder - Guardian.co.uk
Years ago, I spent a summer working in a bicycle shop in Tampa, Florida. I had fully paid healthcare and got a weekly bonus for commuting to work by bicycle. These seemingly liberal policies aside, the shop was a hotbed of virulent conservative rhetoric. What surprised me most at the time was how all sorts of rightwing proclamations were prefaced and postscripted with a reference to taxation.
The plight of those without healthcare was trumped by an appeal to keeping taxes low. The need for tighter security at the US-Mexican border was also justified as a fiscal matter. From bike shop workers and customers alike, I repeatedly heard narratives that implied a failure to pay taxes should disentitle someone to public education or even emergency hospital care. In one particularly hyperbolic outburst, one person in the shop rationalized the hypothetical murdering of a household of migrant workers with the comment, "What's it matter? They don't pay taxes."
Heard in More US States: See You in Tax Court!
By Reuters via CNBC.com
Georgia State Representative Allen Peake owns 20 restaurants and this year he took his frustrations with his tax bills to the state capitol, where he helped push through legislation creating a new state tax court.
"I've had several sales tax audits done and disputed them, and never felt I had a fair shake," said Peake, echoing the views of other business owners.
Before Peake's bill passed, Georgia taxpayers challenging state tax authorities had to pay disputed taxes before appealing them. Their appeals would be heard by the same Department of Revenue that levied the tax in the first place. And further appeals could be overruled by the revenue commissioner or heard by a judge without tax expertise.
House to Consider Handing Over
Internet Regulation to United Nations
By Kurt Nimmo - Infowars.com
China, Russia, Brazil, India and other UN members are backing a proposal to hand over regulation of the internet to the UN's International Telecommunication Union (ITU). The House of Representatives will vote on the measure this week. It is reported that the legislation faces an uphill battle.
The proposal would give the United Nations control over cybersecurity, data privacy, technical standards and the web address system. The present system is operated by a "multi-stakeholder" approach that gives control to nonprofits instead of governments.
Larry Strickling, who heads up the Commerce Department's National Telecommunications and Information Administration, told The Hill the measure would impose "top-down regulation where it's really the governments that are at the table, but the rest of the stakeholders aren't."
"China, Russia, Tajikistan, Uzbekistan jointly submit
Int'l Code of Conduct for Information Security to UN"
UNITED NATIONS, Sept. 12 (Xinhua) -- Permanent Representatives of China, Russia, Tajikistan and Uzbekistan to the United Nations jointly sent a letter to UN Secretary-General Ban Ki-moon here Monday, requesting him to circulate the International Code of Conduct for Information Security as a formal UN document of the 66th session of the General Assembly.
The four ambassadors called on in the letter all countries to conduct further discussions on the Code, drafted by the four countries, under the UN framework in a bid to reach consensus on international norms and rules that regulate states' conduct for information and cyber activities at an early date.
* * * * *
The Internet is the LAST BASTION OF FREE SPEECH. Don't let Russia and China take it away from Americans, with UN treaty.
H.RES.628 Latest Title: Expressing the sense of the House of Representatives that the United States should preserve, enhance, and increase access to an open, global Internet.
Sponsor: Rep McCaul, Michael T. [TX-10] (introduced 4/19/2012) Cosponsors (1)
Related Bills: H.CON.RES.114
Buying a Piece of America:
Why Chinese Shoppers Love U.S. Brands Products from Nike to Apple to Lady Gaga offer a safe way to taste the forbidden fruit of American individualism.
By Tom Doctoroff - TheAtlantic.com
Americans can often carry a somewhat simplistic view of China and the Chinese people. Although apprehensive about the rise of this economic juggernaut and its impact on the American way of life, the images China casts are rooted in the past: dusty, robotic, gray, and ultra conformist.
The Chinese, on the other hand, are fascinated by America, although often perplexed by its inherent contradictions. The United States is both free and unfair, creative and fashion challenged (some Chinese describe blue button-down shirts and khaki pants as our uniform), sporty and grossly overweight, institutionally robust and politically dysfunctional, individualistic and self-deluded (they love to laugh at narcissistic, talent-free American Idol contestants). They are amazed that a nation of 300 million self-starters does not come apart at the seams.
FYI - In case you are unaware of this global agenda... The Georgia Guidestones:
America's Most Mysterious Monument
Author Raymond Wiley delves into the mystery of the Georgia Guidestones, a massive granite monument located in northeastern Georgia. Marked by engravings written in twelve languages, the Guidestones are the creation of one R.C. Christian, an individual whose real identity remains unknown. Join Raymond for a tour of the Guidestones and a look at the controversy and strangeness surrounding the monument and its (some say) apocalyptic messages to humanity.
U.N. Security Council meets on Syria
Report: Obama to ask Russia to support leadership transition
By Steve Gelsi, MarketWatch
NEW YORK (MarketWatch) — The United Nations Security Council met Sunday to discuss the situation in Syria, where the death toll from an alleged weekend government attack in the town of Houla climbed to at least 109 people, including children, according to reports.
Outrage mounted Sunday and drew finger-pointing from both sides as a six-week-old cease-fire, brokered by the U.N. and the Arab League, came to a bloody end in recent days. .
Syria on Sunday denied blame for killing 32 children and at least 60 adults.
Houla massacre leaves UN plan in tatters
By Roula Khalaf in London and Abigail Fielding-Smith in Beirut - FT.com
The UN-backed peace plan for Syria was in disarray on Sunday after armed rebels said they would no longer abide by a ceasefire and a local network of protesters demanded the departure of UN observers.
The calls came as the UN Security Council unanimously condemned Friday's massacre in Houla near the city of Homs, which left at least 108 people dead, including 49 children and 34 women. The council said civilians had been shot "at close range" and suffered "severe physical abuse".
It was one of the worst atrocities in the regime's campaign to crush a 14-month revolt against Bashar al-Assad's regime.
US condemns Syria massacre
and looks for Russian help to oust Assad Hillary Clinton harshly condemns Syrian president as Obama reportedly plans to urge Putin to back a transition of power
By Matt Williams in New York - Guardian.co.uk
Secretary of state Hillary Clinton has said the perpetrators of the Houla massacre must be held to account, as she vowed greater international pressure to hound Syrian president Bashar al-Assad from power.
In a strongly worded statement condemning the attack – which left more 90 dead including 32 children – Clinton accused Assad and his cronies of ruling by "murder and fear" adding that the regime must "come to an end".
Joe Biden talks war... Joe Biden: withdrawal from Iraq
and Afghanistan
allows military to refocus Speaking to graduates at West Point, Biden lists Obama administration's achievements and rejects criticism from Romney
By Matt Williams and Agencies - Guardian.co.uk
Troop drawdown in Iraq and Afghanistan has allowed the US to focus on new global challenges after a decade of war, Joe Biden, the vice-president, said on Saturday.
Speaking to graduates at West Point military academy, Biden countered Republican claims that the administration had been weak on foreign policy, citing the hit on Osama bin Laden and the scaling down of conflicts overseas.
Panetta Says U.S. Now Ready to Attack Iran
By Kurt Nimmo - InfoWars.com
On Sunday U.S. Secretary of Defense Leon Panetta said the United States is "ready from a military perspective'' to attack Iran under the guise of preventing it from obtaining nuclear weapons.
Panetta's comments arrive after the U.S. and members of the United Nations Security Council held talks in Baghdad on Iran's supposed nuclear threat.
"I think it was a complete failure, in terms of content," anIranian diplomat told McClatchy on Friday. "The more they talk, the worse it gets."
Iran has enough uranium for 5 bombs
By Fredrik Dahl
(Reuters) - Iran has significantly stepped up its output of low-enriched uranium and total production in the last five years would be enough for at least five nuclear weapons if refined much further, a U.S. security institute said.
The Institute for Science and International Security (ISIS), a think-tank which tracks Iran's nuclear program closely, based the analysis on data in the latest report by the U.N. International Atomic Energy Agency (IAEA) which was issued on Friday.
China-Peru military ties growing stronger
By Kelly Hearn - Special to The Washington Times
LIMA, Peru — Trade between China and Peru, a key U.S. ally in the regional drug war, is at an all-time high. Now the Chinese security apparatus is getting in on the action.
Military officials from Beijing increasingly are making high-level visits, pushing initiatives to protect Chinese nationals and companies here, and, in some cases, undermining U.S. arms deals in order to sell their own weapons to this resource-rich Andean nation.
Last month, for example, the Peruvian Defense Ministry canceled a $114 million contract with a consortium that included U.S. defense manufacturer Northrop Grumman after a Chinese company convinced officials the project did not meet technical specifications.
Russia turns up the nuclear rhetoric
By Charles Clover in Moscow and Geoff Dyer in Chicago
Before Dmitry Medvedev's valedictory speech earlier this month, the outgoing president awarded medals to dozens of Russians, including a theatre director, a policewoman and the chairman of the Russian hockey federation. Then, taking the podium in a glittering Kremlin ballroom, Mr Medvedev declared that Russia's younger generation needed positive role models to inspire them towards "success in literature, art, education, and" – he paused wistfully – "nuclear weapons".
"They may still come in handy," he said, apropos, seemingly, of nothing. "We're not going to use them, but let's still keep them around, because we have a big country, a complex country. We must value it and protect it."
What If We Have Only Memories of Freedom?
by Andrew P. Napolitano - LewRockwell.com
What if Memorial Day reminds us of times when we had more freedom? What if freedom is dying right under our eyes? What if the memory of the past is more fulfilling than the reality of the present?
What if the federal government could write any law, regulate any behavior and tax any event, no matter what the Constitution authorized? What if the majority in Congress rejects the idea of limited government and views the Constitution as granting it blanket power to do whatever it can get away with? What if the constitutional prohibition on the government's taking of life, liberty or property without due process of law is only for show and is not for real?
Millions of Patriots Have Already Paid the Full Price
"I am well aware of the toil and blood and treasure that it will cost to maintain this Declaration, and support and defend these States." --John Adams
Memorial Day provides a stark contrast between the best of our nation's Patriot sons and daughters versus the worst of our nation's civilian culture of consumption.
Amid the sparse, reverent observances of the sacrifices made by millions of American Patriots who paid the full price for Liberty, in keeping with their sacred oaths, we are inundated at every turn with the commercialization of Memorial Day by vendors who are too ignorant and/or selfish to honor this day in accordance with its purpose.
Memorial Day Weekend Heat Wave
By Alex Sosnowski, Expert Senior Meteorologist
Break out the fans and air conditioners and get the pools ready as Mother Nature has a stretch of hot, humid weather just in time for the Memorial Day weekend for portions of the Midwest and East.
As cool air with gust winds sweep over the Southwest and snow falls over the high country in the Rockies, building heat over the southern Plains is forecast to surge northeastward later this week.
While the pattern is only likely to last several days, it will feature the highest actual temperatures and AccuWeather.com RealFeel® temperatures of the season so far. (The RealFeel temperature incorporates a number of atmospheric conditions to show how it feels on the human body).
Uncivilized Investing
By Dan Denning - DailyReckoning.com
05/24/12 Melbourne, Australia – Uncivilized times call for uncivilized investments.
Charlie Munger, Warren Buffett's partner in crime at Berkshire Hathaway, told CNBC recently, "I think gold is a great thing to sew into your garments if you're a Jewish family in Vienna in 1939, but I think civilized people don't buy gold. They invest in productive businesses."
In a way, Munger is correct. Gold is uncivilized in the sense that it functions best when civilization functions worst. The more uncivilized a society becomes, the more civilized gold becomes.
Wall Street Banks Building A Private Army?
By Alexander Higgins - Alt-Market.com
Wall Street banks have secretly taken over US firearms and ammunition manufacturers and the world's largest mercenary firms in a stealth build up private military force.
A Daily KOs article reveals that Wall Street banks have used private equity firms to acquire and launch a massive stealth takeover of private security firms, US ammo and gun manufacturers, uniforms, silencers and an army of mercenaries to build what amounts to the world's largest private army.
Threading the Fiscal Needle
By Michael Boskin - Project-Syndicate.org
PALO ALTO – Elections often turn on the state of the economy, especially in hard times. When growth and jobs are down, voters throw out incumbents – whether Spanish leftists, French rightists, or Dutch centrists. The United States is no exception. Three years into the Great Depression, Herbert Hoover was trounced by Franklin Delano Roosevelt. In 1980, following a severe bout of stagflation, Ronald Reagan routed Jimmy Carter.
At the same time, economic performance depends to a considerable extent on economic policy. The Great Depression was intensified by poor monetary policy, tax hikes, and protectionist trade policies. Likewise, loose US monetary policy in the middle of the last decade helped to set the stage for the Great Recession by contributing significantly to an explosion of leverage and fueling the housing bubble that burst in 2007-2008.
The Big Print Is Coming
by Mike Krieger of Libertyblitzkrieg - ZeroHedge.com
....Has The Fed Waited Too Long?
Those that know me understand clear as crystal that I don't approve of massive money printing. I think it is theft, plain and simple, and represents an egregiously deceptive manner of transferring wealth from the poor to the wealthy and from the productive to parasitic financial oligarchs. That being said, the world we live in is being led by a bunch of crooked banksters and the Central Planners that do their bidding. At the top of the Central Planning global ponzi pyramid, is our very own Federal Reserve, headed by master Keynesian magician, the Wizard of Eccles, Ben Bernanke. For the vast majority of 2012, the Federal Reserve has been playing a very, very dangerous game. This game has been to pretend that they will not be printing any more money in an attempt to get commodity prices down as low as possible before they proceed with the inevitable. While they have done this on a smaller scale many times in the past, this particular game of chicken has in my opinion gone dangerously wrong. You see, ever since the 2008 debacle the Fed has been quite aggressive and more or less "ahead of the curve" when it has come to feeding new liquidity into the system…until now.
National debt: Will the U.S. be like Japan?
By Jeanne Sahadi @CNNMoney
NEW YORK (CNNMoney) -- Political gridlock. High national debt. Rock-bottom bond rates. An aging population. Warnings about more downgrades.
Sound like the United States? Indeed. But those characteristics also describe Japan -- the country that fiscal experts often point to as a cautionary tale about the risk of carrying too much national debt for too long.
Ever since a stock market crash and banking crisis more than 20 years ago, Japan has suffered from anemic growth for much of that time and its debt has soared.
The Real Obama Budget Deficit For 2011: 5 Trillion Dollars
By Michael Snyder - EndOfTheAmericanDream.com
If the U.S. government used the same accounting methods that most U.S. businesses use, the real federal budget deficit for last year would have been 5 trillion dollars instead of 1.3 trillion dollars. So where does the huge difference come from? I think a simple illustration would be helpful here. When you go shopping, do you only count the transactions where you use cash, or do you also count the transactions where you signed on the dotted line and promised to pay later? Of course you count both of them. Well, the U.S. government does not count promises to pay later when calculating budget deficits. The "official" Obama budget deficit for 2011 was 1.3 trillion dollars, but according to USA Today when you add in the rise in liabilities for Social Security, Medicare and other retirement programs that adds another 3.7 trillion dollars to the total. Those are future financial promises that we have made that future taxes are not expected to cover. This analysis by USA Today squares very well with what analysts such as John Williams of shadowstats.com have been saying for years. The truth is that our federal budget deficits have actually been far worse than we have been told.
Google Trends Shows Why The Status Quo
"Powers That Be" Should Be Scared. Very Scared
Submitted by Tyler Durden - ZeroHedge.com
The volume of searches for the phrase 'Bank Run' has just hit an all-time high - higher now than even during the peak of the Lehman Brothers 'moment'. While English dominates the language choices, the Europeans (Dutch, Germans, and French) are extremely 'interested' as are the Chinese...but it appears the Singaporeans are running the most scared (as we noted here) is perhaps not surprising, followed by the Irish and the Americans - with Germany a disappointing 10th - perhaps they really do not care as much as everyone's bluff-calling hopes. It seems the fears of real 'bank runs' are becoming virtually 'viral' - not a good sign for the stability of the fictional-reserve-banking-dependent status quo.
They say that breaking up is hard to do
Now I know that it's true — Neil Sedaka
What's the Greek word for 'chutzpah'? We don't know either.
But the leader of the communists/socialists, Alexis Tsipras, has it. He must have heard that old saying:
"When you owe your bank $100,000, you can't sleep at night. When you owe your bank $1 million, your banker can't sleep at night."
Since the Greeks owe money all over town, he figured he could thumb his nose at his lenders. He told the Germans that they were trapped. They had no choice. They had to keep the money flowing to Greece. Otherwise, the Greeks would default…and cause Hell to all of Europe.
What's the word for "oh yeah?" in German? We don't know that either. But surely the Germans have a word for this occasion. A word that means… "We'll show you what a moron you are…"
Police urge Greeks to keep money in bank Scale of withdrawals from Greek banks has led to speculation that eurozone-wide guarantee is need to maintain confidence
By Jill Treanor - Guardian.co.uk
Police are urging Greeks to keep their money in bank accounts rather than putting it at risk of theft, amid further uncertainty about whether the austerity-struck country will remain in the eurozone.
Greece's banks are likely to be shored up on Friday or Monday with €18bn (£14bn) of bailout funds they have been due to receive for weeks but which were held up by political uncertainty caused by inconclusive elections. Greece goes to the polls again on June 17, further stoking fears about its future within the euro.
Fed's Bullard says orderly Greek exit possible
By Mark Felsenthal
(Reuters) - Greece could exit the euro zone without doing deep damage to the U.S. and European economies if the transition is handled properly, a top U.S. Federal Reserve official said on Wednesday.
Concerns about a Greek exit have kept global financial markets under pressure in recent days.
"I'm one that thinks that Greece could exit, and it could be handled in an appropriate way without causing too much damage, either in Europe or in the U.S.," St. Louis Federal Reserve Bank President James Bullard told Reuters.
What would Greek exit mean for the U.S. economy?
By Stella Dawson
(Reuters) - Uncertainty over the fate of the euro currency is already dampening U.S. economic growth and any significant worsening of the crisis would deal a blow to a recovery that is gradually gathering steam.
Economists estimate that volatile markets and business uncertainty over the fate of Greece and the policy course in Europe is already shaving anywhere from one tenth to one half a percentage point from U.S. 2012 gross domestic product growth.
Europe's slump deepens as Kabuki summit falls short Once again Europe's leaders have swooped into Brussels and vanished hours later without offering any clear way out of the pulsating crisis at hand.
By Ambrose Evans-Pritchard - Telegraph.co.uk
Greece scarcely made it on to the agenda. The hard decisions have been delayed until the next summit in late June. There was no agreement on use of the European bail-out fund (ESM) to shore up Club Med banking systems and take the strain off the sovereign states.
Mario Draghi, president of the European Central Bank, said the EU is at a "crucial moment" in its history. "We have reached a point in which the process of European integration needs a courageous leap of political imagination in order to survive," he said. Yet no such leap was in evidence. The eurozone is no closer to equipping itself with federal debt machinery and a genuine lender of last resort.
Frozen Europe Means ECB Must Resort To ELA
By Dara Doyle and Jeff Black - Bloomberg.com
The European Central Bank is trying to limit the flow of information about so-called Emergency Liquidity Assistance, which is increasingly being tapped by distressed euro-region financial institutions as the debt crisis worsens. Focus on the program intensified last week after it emerged that the ECB moved some Greek banks out of its regular refinancing operations and onto ELA until they are sufficiently capitalized.
European stocks fell and the euro weakened to a four-month low as investors sought clarity on how the Greek financial system would be kept alive. The episode highlights the ECB's dilemma as it tries to save banks without taking too much risk onto its own balance sheet. While policy makers argue that secrecy is needed around ELA to prevent panic, the risk is that markets jump to the worst conclusion anyway.
The most pro-European thing to do now is reject the euro Those readers who have been berating me for years for even considering the possibility of a country leaving the euro have recently fallen silent. (You know who you are.)
By Roger Bootle - Telegraph.co.uk
This week I want to move on from trying to forecast what even the most purblind of euro-fanatics now recognise as, to put it mildly, a very distinct possibility, to considering the consequences.
You may think this is premature. Personally, I have always thought that if you are going to be a forecaster you should specialise in being early.
So what would happen if Greece were to leave the euro? The short answer is that I don't know. What's more, neither does anyone else. Moreover, you should beware anyone who tells you otherwise.
Spain: ECB cash more important than euro-plans
BY VALENTINA POP - EUObserver.com
BRUSSELS - Spanish Prime Minister Mariano Rajoy early on Thursday (24 May) called on the European Central Bank (ECB) to help lower his country's borrowing costs as a matter of urgency.
He said the bank problem is more important than the plans for an economic union brainstormed by EU leaders at a late-night dinner in Brussels, which ended up tasking EU Council chief Herman Van Rompuy with drawing up a long-term plan.
Is the Euro Ending or Beginning?
By Jean Pisani-Ferry - Project-Syndicate.org
BRUSSELS – When the architects of the euro started drawing up plans for its creation in the late 1980's, economists warned them that a viable monetary union required more than an independent central bank and a framework for budgetary discipline. Study after study emphasized asymmetries within the future common-currency area, the possible inadequacy of a one-size-fits-all monetary policy, the weakness of adjustment channels in the absence of cross-border labor mobility, and the need for some sort of fiscal union involving insurance-type mechanisms to assist countries in trouble.
How Europe Keeps Messing Up in Greece in 1 Chart
By Matthew O'Brien - TheAtlantic.com
There's nothing wrong with making a bad prediction prediction. Predictions, as the cliché goes, are hard, especially about the future. But there is something wrong with consistently making bad predictions that affect the lives of tens of millions of people.
The chart below, inspired by Dani Rodrik, looks at how the IMF has done at projecting unemployment in Greece the past few years. The IMF puts out a semi-annual World Economic Outlook to predict a few major economic variables for every country for the next two years. I took the early-year projections for Greece from 2008 through 2011 and show how much they missed on their one-year predictions (BLUE) and on their two-year predictions (RED).
Eurobonds: The Issue That Could Shatter Europe
By Michael Snyder - TheEconomicCollapseBlog.com
Would you pool your debt with a bunch of debt addicts that have no intention of reducing their wild spending habits? Of course you wouldn't. But that is exactly what Germany is being asked to do. Increasingly, "eurobonds" are being touted as the best long-term solution to the financial crisis in Europe. These eurobonds would represent jointly issued debt by all 17 members of the eurozone. This debt would also be guaranteed by all 17 members of the eurozone. This would allow all countries in the eurozone to enjoy the same credit rating that Germany does, and borrowing costs for nations such as Greece, Portugal, Italy and Spain would plummet. But borrowing costs for Germany would rise substantially. In fact, it is being estimated that Germany could be facing an extra 50 billion euros a year in interest expenses. So over ten years that would come to about 500 billion euros. Needless to say, Germany is not thrilled about this idea. But new French President Francois Hollande is pushing eurobonds very hard, and he has the support of the OECD, the IMF and many top Italian politicians. In the end, this could be the key to the future of the eurozone. If the Germans give in and decide that they are willing to deeply subsidize their profligate neighbors indefinitely, then the euro could potentially be saved. If not, then this issue could end up shattering Europe.
Monti Says Germany Can Be Persuaded On Euro Bonds
By Jeffrey Donovan - Bloomberg.com
A majority of European Union leaders at a Brussels summit this week backed joint euro-area bonds, and Italy can help persuade Germany to support Europe's "common good" as well, Italian Prime Minister Mario Monti said.
"Europe can have euro bonds soon," Monti said in an interview on Italian television station La7 yesterday. Germany has an interest in ensuring no country leaves the euro, while Greece will probably remain in the 17-nation currency region even as "anything can happen," he said in the interview.
Van Rompuy to draft plan for deeper economic union
BY VALENTINA POP - EUObserver.com
BRUSSELS - EU leaders have tasked council chief Herman Van Rompuy with drafting a plan on deepening the eurozone's economic union, potentially via an inter-governmental treaty.
After more than five hours of talks on the need to strengthen growth policies while sticking to the already strengthened deficit rules, EU leaders on Wednesday night (23 May) agreed to come back to these issues at a formal summit on 28 June.
A scurrilous thought for Greece and China
by Golem XIV - Golemxiv.co.uk
For whom might it make sense to help Greece, as impasse with Germany hardens and Greece approaches default? And what sort of offer of help would make sense for Greece?
Europe and in particular the Germans have painted themselves into a Teutonic corner. It will make no more nor less sense for Germany to blink in two or three weeks time than now. Of course as the reality nears, of their own banks and those in France having to come clean before their own populace about the bad loans they made to Greece, they may lose their nerve. I strongly recommend Mr Tsipras reiterate his determination to set up a Debt Commission. The prospect of Europe's and America's banks having all their grubby and quite possibly fraudulent dealings with Greece's oligarch families when they were in government, paraded in public will leave many powerful people wondering if an unfortunate helicopter accident couldn't be arranged by some friendly…. no, no no. What am I saying! Or perhaps a fire inside a sealed room? Only joking.
So who?
World Bank warns of China slowdown
By Chris Isidore @CNNMoney
NEW YORK (CNNMoney) -- The World Bank said a slowdown in China will drag on growth in the entire East Asia-Pacific region.
The bank, an international organization that helps to fund projects in the developing world, said in a report released Wednesday that growth in the East Asia-Pacific region should slow to 7.6% this year from 8.2% in 2011 and 10% as recently as 2010.
The slowing regional growth is due to China, which has seen its exports fall due to economic weakness across the developed nations that are its primary customers. Chinese growth is projected to fall to 8.2% this year from 9.2% last year, according to the World Bank's forecast.
JPMorgan Gave Risk Oversight
To Museum Head Who Sat On AIG Board
By Dawn Kopecki and Max Abelson - Bloomberg.com
The three directors who oversee risk at JPMorgan Chase & Co. (JPM) include a museum head who sat on American International Group Inc.'s governance committee in 2008, the grandson of a billionaire and the chief executive officer of a company that makes flight controls and work boots.
What the risk committee of the biggest U.S. lender lacks, and what the five next largest competitors have, are directors who worked at a bank or as financial risk managers. The only member with any Wall Street experience, James Crown, hasn't been employed in the industry for more than 25 years.
Taxpayer Supported Gambling
By Greg Hunter's USAWatchdog.com
The $2 billion derivative trading loss JP Morgan announced, about two weeks ago, is growing in size. It is reportedly now more than triple the original loss. According to a CNN report, "One thing seems clear about JPMorgan Chase's $2 billion loss. It's no longer $2 billion. It's likely much higher. The number being bandied about now is closer to a range of $6 billion to $7 billion, according to several people working on trading desks that specialize in the derivatives JPMorgan Chase (JPM, Fortune 500) used to make its trades and from two sources with knowledge of the bank's positions."
Frontline On MF Global's Six Billion Dollar Bet
Submitted by Tyler Durden - ZeroHedge.com
While the sur-realities of just what Corzine and the rest of the MF Global 'traders' did has been extensively discussed here and elsewhere, PBS' Frontline provides the most succinct (and relatively in-depth) documentary on just what occurred from how the corrupt CEO lobbied regulators who had the power to stop his risky bets to the endgame realization of the missing customer money. A narrative, not just of "a bet that went bad", but "a Wall Street morality tale". Must watch!
The story of Jon Corzine, the former head of Goldman Sachs and political power broker, who took over MF Global in the spring of 2010 with oversize ambition and a passion for risk. But after a massive bet on European debt turned sour, the firm lay in ruins, with more than a billion dollars of customer funds missing.
Facebook Saves Face, But Did America?
by Bill Sardi - LewRockwell.com
There was something bigger at stake last week when Facebook launched its initial public offering (IPO). Some commentators said the credibility of the markets were at risk. The Facebook IPO had been so overhyped around the world that Wall Street just couldn't let this one fail. Its underwriter, investment bank Morgan Stanley, ended up propping Facebook's stock at the end of its initial Friday trading day. Its starting price per share was $38.00, its initial buy was $42.00, and its final price was $38.23. Facebook saved face, at least for now.
But by the following Tuesday, its 3rd day of trading, it's stock fell to $31. Some analysts think Facebook should be trading between the $15-to-$18 per share price. How could such a long anticipated IPO fizzle so fast? Facebook is a household name, not a wanna-be startup.
Fidelity facing "thousands" hit by Facebook woes
By Jessica Toonkel and Tim McLaughlin
(Reuters) - Fidelity Investments said it was working with "thousands" of brokerage clients affected by trading issues that have engulfed Facebook Inc's much-anticipated initial public offering, according to a source familiar with the situation.
The social media site's IPO has been steeped in controversy since it started trading last Friday.
Almost a week later, many investors have found that their orders for Facebook were not executed at the prices they thought, said advisers, who declined to be identified because they are not allowed to speak to the press.
Wall Street, not Facebook,
Bears Most of the Blame for the Company's IPO Debacle
by Zachary Karabell - TheDailyBeast.com
All the actors in the Facebook IPO debacle look bad, Zachary Karabell writes, but most of the blame should be directed at Morgan Stanley and the other banks that underwrote the stock offering. Plus, Dan Lyons breaks down 7 things to know about the scandal.
Keiser Report: Stripped To Teeth (E292)
In this episode, Max Keiser and co-host, Stacy Herbert, discuss self-reporting financial crimes and private equity ripping teeth out of four year olds for profit. In the second half of the show Max talks to Teri Buhl about JP Morgan's Wells Notice and what bad news that could mean to the troubled bank's fortunes.
IRS Cuts Deals
BY BRUCE KRASTING - FinancialSense.com
The other day the IRS announced new rules for settling tax liabilities for individuals. It's a sweet deal. I thought that was interesting. Then yesterday we get an announcement from Altria (MO) that they too have cut a deal with the boys at the IRS. Coincidence? Leading indicator? Some details:
Individuals - The IRS spells out the new terms for individuals who are delinquent here.
Summary:
When the IRS calculates a taxpayer's reasonable collection potential, it will now look at only one year of future income for offers paid in five or fewer months, down from four years, and two years of future income for offers paid in six to 24 months, down from five years. In addition, equity in income producing assets generally will not be included in the calculation of reasonable collection potential for on-going businesses.
Rick Santelli on the War Between the States−
Tax Too Much and People Will Leave Texas and North Dakota winning the war by creating the environment for jobs and prosperity
Interview - James J Puplava CFP with Rick Santelli - FinancialSense.com
Jim is pleased to welcome back CNBC's Rick Santelli to discuss how many large states such as California and Illinois are increasing both deficit-spending and taxes, driving out job creators to more business and tax-friendly states. Rick notes that if the light bulbs don't come on soon for many state legislatures, the lights of commerce will continue to go off, or move to a more welcoming state.
30-year mortgage rate hits another record low
By Les Christie and Jessica Dickler @CNNMoney
NEW YORK (CNNMoney) -- Buying a home got even cheaper this week as interest rates on the 30-year fixed-rate mortgage set a record low for the fourth week in a row.
The 30-year fixed mortgage, the most popular mortgage product, dipped slightly to 3.78% from 3.79% last week, according to a weekly survey by Freddie Mac. Last year, 30-year loans averaged 4.60%. The new low can save borrowers $48 a month for every $100,000 borrowed. Over a 30-year term, that comes to $17,217 compared to last year.
Baby Boomers Are a Looming Disaster Are baby boomers to blame?
Behind a lot of our current economic woes and hanging over the future is a simple problem: A huge generation that has to keep working because it hasn't saved enough for retirement
By Anthony Mirhaydari, MSN Money
You don't have to be a hedge fund manager or a Wall Street CEO to know that something's very wrong with the economy and the stock market right now. I'm not talking just about the embarrassingly bad Facebook (FB) initial public offering. Let me count the problems.
Inflation-adjusted wages have been steadily falling over the past few months, the first time that has happened in a nonrecession environment, as people turn to credit cards and tap savings in response to higher food and fuel prices. Last year, we had the weakest nonrecession annual growth of gross domestic product since the 1940s. The credit channel is broken. Home prices are down to 2002 levels. And the stock market has yet to retake its 2000 or 2007 highs.
Half Of Detroit's Streetlights May Go Out As City Shrinks
By Chris Christoff - Bloomberg.com
Detroit, whose 139 square miles contain 60 percent fewer residents than in 1950, will try to nudge them into a smaller living space by eliminating almost half its streetlights.
As it is, 40 percent of the 88,000 streetlights are broken and the city, whose finances are to be overseen by an appointed board, can't afford to fix them. Mayor Dave Bing's plan would create an authority to borrow $160 million to upgrade and reduce the number of streetlights to 46,000. Maintenance would be contracted out, saving the city $10 million a year.
Turn Out The Lights - The Largest U.S. Cities
Are Becoming Cesspools Of Filth,
Decay And Wretchedness
By Michael Snyder - TheEconomicCollapseBlog.com
Once upon a time, the largest U.S. cities were the envy of the entire world. Sadly, that is no longer the case. Sure, there are areas of New York City, Boston, Washington and Los Angeles that are still absolutely beautiful but for the most part our major cities are rapidly rotting and decaying. Cities such as Detroit, Cleveland, Baltimore, Memphis, New Orleans, St. Louis and Oakland were all once places where middle class American workers thrived and raised their families. Today, all of those cities are rapidly being transformed into cesspools of filth, decay and wretchedness. Millions of good jobs have left our major cities in recent decades and poverty has absolutely exploded. Basically, you can turn out the lights because the party is over. In fact, some major U.S. cities are literally turning out the lights. In Detroit, about 40 percent of the streetlights are already broken and the city cannot afford to repair them. So Mayor Bing has come up with a plan to cut the number of operating streetlights almost in half and leave vast sections of the city totally in the dark at night. I wonder what that will do to the crime rate in the city. But don't look down on Detroit too much, because what is happening in Detroit will be happening where you live soon enough.
Press 1 For English: Is America Destined
To Become A Multilingual Nation?
By Michael Snyder - EndOfTheAmericanDream.com
The quickest way to divide people is to have them speak different languages. America has always been a nation of immigrants, but one of the things that has always united us as a nation has been the English language. In the past, it was always understood that if you wanted to thrive in the "land of opportunity" that you had better learn English and learn it well. Unfortunately, times have changed. Today, many radical activist groups are actually referring to the English language as a "tool of oppression" and are demanding that special accommodations be made for those that do not wish to learn the English language. But what languages are we supposed to accommodate? Overall, there are 325 different languages spoken at home in the United States today. So which of those languages should receive special treatment? How far are we really going to take all of this? Someday, instead of your telephone telling you to "press 1 for English, 2 for Spanish", it may tell you to "press 323 for Italian, 324 for Arabic or 325 for English". Yes, that is kind of a ridiculous example, but we really should examine where all of this is headed. Is America destined to become a multilingual nation where we all struggle to understand one another?
Lawmakers question whether Google
misled Congress on data collection
By Brendan Sasso - TheHill.com
Two Democratic lawmakers on Thursday questioned whether Google misled Congress and regulators over its collection of data from unprotected Wi-Fi networks.
Reps. Frank Pallone (D-N.J.) and John Barrow (D-Ga.), who both serve on the Energy and Commerce Committee, sent a letter to Attorney General Eric Holder asking him to re-open the Justice Department's investigation into the case.
Empire Over Economy: 'US may follow in USSR footsteps'
The US could collapse like the USSR, because it pursues futile military policies at the expense of economy, says Clyde Prestowitz, ex-Counselor to the Secretary of Commerce in the Reagan Administration. He thinks this track is risky and destructive.
Russia turns up the nuclear rhetoric
By Charles Clover in Moscow and Geoff Dyer in Chicago - FT.com
Before Dmitry Medvedev's valedictory speech earlier this month, the outgoing president awarded medals to dozens of Russians, including a theatre director, a policewoman and the chairman of the Russian hockey federation. Then, taking the podium in a glittering Kremlin ballroom, Mr Medvedev declared that Russia's younger generation needed positive role models to inspire them towards "success in literature, art, education, and" – he paused wistfully – "nuclear weapons".
"They may still come in handy," he said, apropos, seemingly, of nothing. "We're not going to use them, but let's still keep them around, because we have a big country, a complex country. We must value it and protect it."
OBAMA DOJ FORCES UNIVERSITY
TO ALLOW BIOLOGICAL MALE INTO FEMALE RESTROOMS
By Ben Shapiro - Breitbart.com
The Obama Department of Justice has reportedly ordered the University of Arkansas at Ft. Smith (UAFS) to allow a male student to use women's bathrooms on campus. Campus Reform reports that a male student who calls himself "Jennifer Braly," and is in the process of raising money to pay for his sex-reassignment surgery, filed a complaint with the Civil Rights Division of the Department of Justice after the campus told him to use gender-neutral bathrooms rather than women's restrooms.
"Someone saw me using the women's public restrooms and complained," said Braly. "[O]ne problem to this is there are not unisex bathrooms in every building. Especially the two main buildings where most of my classes are, so I have to go to a completely different building to use the restroom." The university had offered to turn more gender-specific bathrooms into gender-neutral bathrooms. Braly filed the complaint anyway.
Volcano Crystals Hold Clues To Next Big Eruption
By Elizabeth Lopatto - Bloomberg.com
Crystals formed in the molten rock of a volcano may help predict the next eruption of Mount St. Helens or Mount Vesuvius as far as a year in advance, researchers said.
Drawing from data of the explosions of Mount St. Helens in 1980 through 1986 in Washington, scientists found that iron- and magnesium-rich crystals grew before an eruption, according to a study in the journal Science. The most rapid growth happened in the 12 months before the volcano exploded, the analysis showed.
Vatican Bank Chief Ousted After Money-Laundering Scandal
By Flavia Krause-Jackson - Bloomberg.com
The Vatican bank, whose reputation took a blow last year over an investigation into money laundering, has fired Chairman Ettore Gotti Tedeschi after a tenure stained by a financial scandal.
In a vote of no-confidence, the board of directors unanimously agreed to remove Tedeschi, aBanco Santander SA (SAN) banker who took the job in 2009, from his post for failing "to carry out various duties of primary importance," according to a statement by Vatican spokesman Federico Lombardi.
"I would rather say nothing otherwise I would only have ugly words to say," Tedeschi told reporters in Rome, according to Italian news agency Ansa.
Brotherhood claims lead as Egypt vote count begins
By HAMZA HENDAWI, Associated Press
CAIRO (AP) — The Muslim Brotherhood quickly staked a claim Thursday for its candidate to advance to a runoff vote, saying its exit polls showed him leading in Egypt's landmark presidential election to succeed ousted leader Hosni Mubarak.
As vote-counting began, exit polls by several Arab television stations also suggested the Brotherhood's Mohammed Morsi was ahead of the pack of 13 candidates. The reliability of the various exit surveys was not known, and a few hours after the end of two days of voting, only a tiny percentage of the ballots had been counted.
Egyptian election results point to strong performance
by Muslim Brotherhood Mohammed Morsi looks likely to go on to compete in run-off vote as Amr Moussa asks Mubarak's ex-PM to withdraw
By Ian Black in Cairo - Guardian.co.uk
Egypt's historic presidential election was on a knife edge early on Friday as first results pointed to a commanding performance by the Muslim Brotherhood candidate Mohammed Morsi, who is now likely to go on to compete in a runoff vote next month.
Morsi's apparent lead was trumpeted by the well-organised Islamist movement soon after the polls closed on the second day of the two-day vote – the first time Egyptians have ever had a genuine choice of leader.
Tom Horn on Red Ice. Hour 1
Petrus Romanus, The Final Pope
Thomas Horn is an internationally recognized lecturer, radio host and bestselling author of several books including his newest books, Petrus Romanus: The Final Pope Is Here. He is a well-known columnist who has been interviewed by US Congressmen and Senators on his findings as well as featured repeatedly in major media. Thomas received the highest degree honorary doctorate bestowed in 2007 from legendary professor Dr. I.D.E. Thomas for his research into ancient history. He returns to Red Ice to discuss Petrus Romanus. For more than 800 years scholars have pointed to the dark augury having to do with "the last Pope." The prophecy, taken from St. Malachy's "Prophecy of the Popes," is among a list of verses predicting each of the Roman Catholic popes from Pope Celestine II to the final pope, "Peter the Roman," whose reign would end in the destruction of Rome. St. Malachy's list heralds the beginning of "great apostasy" followed by "great tribulation" sets the stage for the imminent unfolding of apocalyptic events. According to this prophecy, the next Pope will be a false prophet who leads the world's religious communities into embracing a political leader known as Antichrist.
Hedge Funds Re-evaluate Gold's Potential
BY CLIF DROKE - FinancialSense.com
Gold's biggest problem since February has been one of relative weakness. This weakness in turn has kept the market-moving hedge fund players away from gold. But as we'll see in the latest commentary, that may be about to change.
In late February when the gold price rallied sharply to its highest level of the year at $1,793 it looked, on the surface, like gold was finally about to break out of its holding pattern since last September when the metal took a sharp dive. The February rally proved to be a "head fake" however. The yellow metal took another plunge within days of making its late February high at $1,793 and fell to a low of $1,538 on May 16.
Gold is bottoming, to decline further before next rally
By Chris Vermeulen - CommodityOnline.com
Gold prices are in a process of bottoming, it could decline further before the start of another rally upwards. Central Banks have preferred printing enormous amount of fiat currencies sharing the same view as Keynesian economist Paul Krugman.
They believe that the modern finance system does not need gold and that fiat currency is the answer even though history argues in their face across multiple millennia.
Dollar Backwardation
By Keith Weiner, New Austrian School of Economics - GoldSeek.com
The current financial crisis, may progress to a phase where people demand and hoard dollar bills but take electronic deposit credits only at a discount which increases until electronic deposit credits are repudiated entirely. The Federal Reserve would be powerless to solve the problem, because while they can create unlimited electronic deposit credits they can't create unlimited paper dollar bills, "money you can fold" as Professor Antal Fekete calls it. There would be a glut of electronic deposits, but a shortage of dollar bills.
The Real Crash
By: Peter Schiff - GoldSeek.com
I first came to national attention back in 2008 and 2009 when the housing and credit markets imploded. I became known as the guy that other market "experts" laughed at when I warned of trouble brewing in the seemingly indestructible American economy. After the wheels ground to a halt in mid-2008, people noticed that my book Crash Proof, originally released in early 2007, read like a detailed preview of many of the events that eventually unfolded.
US TBond Tower of Babel Teeters
By: Jim Willie CB
The Biblical story is told of a tower built ever higher in order to achieve contact with the heavens, lest they be scattered upon the earth. They were scattered when the tower fell. Fast forward to today, where the earth has a multitude of tribes, languages, and several major alphabets. When the Lehman Brothers failure occurred, and the Fannie Mae and AIG activities were to be concealed under court orders, the land turned barren, and a financial plague befell the Western nations led by the United States. They were after all, the keepers of the ark (printing press for USDollars). But a plague of debt locusts was cast upon the US nation, with annual $1.5 trillion deficits. The Americans in their unending arrogance, chose to speak from the tower top and to proclaim 0% forever, suspending gravity. They have attempted to force free money to finance their USGovt debts, to preserve power, to ensure privilege, but in doing so they defy nature in testing gravity itself.
Greece Rattles Global Markets: Gold, Oil 'Getting Crushed'
By: Patti Domm - CNBC.com
Fears that Greece could leave the euro zone, triggering an exodus by other weak sovereigns, spread through financial markets, sinking stocks and sending the euro to a 22-month low.
As the Dow saw a triple digit loss, buyers rushed into U.S. Treasurys, pushing yields close to historic lows.
The German 30-year bund yield fell below 2 percent for the first time, and strong demand for the safe haven bund resulted in a 2-year note auction yielding zero.
US 'fiscal cliff' looms into view
By Michael Mackenzie, Arash Massoudi
and Vivianne Rodrigues in New York - FT.com
If you think America's debt problems have gone away, think again. With US presidential elections just months away, wary investors are gauging the impact on markets of a so-called "fiscal cliff" of huge tax rises and spending cuts that are due to kick in.
Economists warn that the legislative uncertainty surrounding the debt ceilingcould result in government gridlock that ultimately pushes the US back into recession. That risk threatens to cast a shadow over equities and other financial assets.
Merkel and Hollande to 'let off steam' at EU summit
BY VALENTINA POP - EUObserver.com
BRUSSELS - EU leaders gathering in Brussels on Wednesday (23 May) evening for an informal summit on how to invigorate the economy are likely to see a sharp exchange of views between France's new President and the German Chancellor on the subject of eurobonds.
France's Francois Hollande in recent days has received broad international support for his ideas on economic stimulus - ranging from US President Barack Obama to the International Monetary Fund (IMF) and the Organisation for Economic Co-operation and Development (OECD), which on Tuesday warned the euro-crisis is the "greatest threat" to the world economy unless leaders get their act together.
Eurozone crisis:
Germany and France clash over eurobonds at summit French president François Hollande marks his Brussels debut by challenging chancellor Angela Merkel over bailout
By Ian Traynor in Brussels and Patrick Wintour - Guardian.co.uk
European leaders were locked in deep divisions over the future ofGreece and the single currency, with Germany and France at loggerheads for the first time in 30 months over how to restore confidence in the euro.
A special EU summit marking the debut of France's President François Hollande saw him challenge Germany's chancellor, Angela Merkel, on the euro, arguing that the pooling of eurozone debt liability – eurobonds– had to be retained as an option for saving the currency. Merkel has ruled out eurobonds as illegal under current EU law.
Eurobonds: The Issue That Could Shatter Europe
By Michael Snyder - TheEconomicCollapseBlog.com
Would you pool your debt with a bunch of debt addicts that have no intention of reducing their wild spending habits? Of course you wouldn't. But that is exactly what Germany is being asked to do. Increasingly, "eurobonds" are being touted as the best long-term solution to the financial crisis in Europe. These eurobonds would represent jointly issued debt by all 17 members of the eurozone. This debt would also be guaranteed by all 17 members of the eurozone. This would allow all countries in the eurozone to enjoy the same credit rating that Germany does, and borrowing costs for nations such as Greece, Portugal, Italy and Spain would plummet. But borrowing costs for Germany would rise substantially. In fact, it is being estimated that Germany could be facing an extra 50 billion euros a year in interest expenses. So over ten years that would come to about 500 billion euros. Needless to say, Germany is not thrilled about this idea. But new French President Francois Hollande is pushing eurobonds very hard, and he has the support of the OECD, the IMF and many top Italian politicians. In the end, this could be the key to the future of the eurozone. If the Germans give in and decide that they are willing to deeply subsidize their profligate neighbors indefinitely, then the euro could potentially be saved. If not, then this issue could end up shattering Europe.
Rise of The EU Commissars: Lord Monckton's In-Studio Report
Lord Monckton joins Alex in-studio today, Wednesday, May 23. Monckton is a British politician, public speaker, former newspaper editor, and a spirited critic of the globalist theory of anthropogenic global warming. Mr. Monckton is in the United States to attend the libertarian Heartland Institute's conference in Chicago.
Letting Greece leave the euro
is the lesser of two evils for all concerned Markets were capitulating last night as a euro break-up took a step closer.
By Damian Reece - Telegraph.co.uk
Greek yields blew out again, UK and German yields contracted further, while equity markets in the US and Europe were a sea of red.
Contingency plans for a Greek exit have been talked about all week but none of them add up to more than the financial equivalent of "duck and cover" – the US government's advice it gave citizens in the event of a nuclear attack.
No compromise in sight on EU document secrecy
BY ANDREW RETTMAN - EUObserver.com
BRUSSELS - Negotiators remain far apart on new rules to govern which internal EU documents can be released for public scrutiny.
Jakob Alvi, the Danish EU presidency spokesman, told EUobserver on Tuesday (22 May) that member states and the European Parliament rapporteur on the dossier, British center-left MEP Michael Cashman, remain poles apart after initial talks, set to continue on Wednesday.
"He made it clear the negotiating mandate that we [member states] have is not something he can accept ... and the same goes the other way around," Alvi noted.
Debt crisis: Germany holds a gun to Greece's head Pressure on Greece increased dramatically on Wednesday night after Germany's central bank called for a suspension of financial support to Athens and eurozone finance ministries agreed to draft contingency plans for a Greek exit from the euro.
By Ambrose Evans-Pritchard - Telegraph.co.uk
In a blunt warning to Athens, the Bundesbank said a Greek withdrawal from the eurozone would be disruptive but "manageable", undermining claims by Greece's radical anti-austerity leader, Alexis Tsipras, that Europe would not dare pull the plug.
"When the Eurosystem provided Greece with large amounts of liquidity, it trusted that the programmes would be implemented and thereby ultimately assumed considerable risks," said the bank. "In the light of the current situation, it should not significantly increase these risks."
UN Security Council 'tired and out of step',
says Amnesty International Human rights group criticises UN body's inaction
over Syria and says it is increasingly unfit for purpose
By Lizzy Davies - Guardian.co.uk
The UN Security Council is suffering a failure of leadership which makes it seem "tired, out of step and increasingly unfit for purpose", the human rights organisation Amnesty International (AI) says on Thursday as it chastises the "determination" of some permanent member states to shield the Syrian regime "at all cost".
In its 50th global human rights report, AI documents human rights abuses in countries across the globe, noting a worsening discrimination against gay people in Africa and an increase in xenophobic rhetoric by some European politicians.
45 Signs That China Is Colonizing America
By Michael Snyder - EndOfTheAmerianDream.com
Just because you were once the most powerful nation on earth does not mean that you will always be the most powerful nation on earth. Every single year, hundreds of billions of dollars leaves the United States and goes to China. This enormous transfer of wealth has had a dramatic effect on both countries. In case you haven't noticed, many of ourformerly great manufacturing cities such as Detroit are rotting away while shining new factories and skyscrapers are going up all over China. If you go into any major retail store today and start turning over products, you will find that hundreds of them have been made in China and that very few of them have been made in America. As a nation, we buy far, far more from China than they buy from us. As a result, China is absolutely swimming in cash and they have been looking for things to do with all that money. One thing that China has done is loan the U.S. government over a trillion dollars and this has given the Chinese a tremendous amount of leverage over us. China has also started to buy up businesses, real estate and natural resources all over America. This kind of "economic colonization" is similar to what China has already been doing in Africa, South America and Australia. The formula is actually very simple. We send them our money and then they use it to buy us. With each passing day China's ownership over America grows, and it is frightening to think about where all of this could end.
The Great Credit Crunch Continues
By Richard Suttmeier - TheStreet.com
NEW YORK (TheStreet) -- With the losses growing on the JP Morgan (JPM_) derivatives trade, it's time to review why the great credit crunch continues. In addition, I will provide some ideas on how to fix the mortgage market and jump start new home construction on Main Street, USA.
More than a year ago, the government panel called Financial Crisis Inquiry Commission blamed banks that made reckless bets, credit rating agencies that endorsed risky mortgage-backed securities and government regulators who overlooked warning signs until they threatened the global financial system.
Who will replace Tim Geithner? Guessing game begins over next Treasury chief
By Glenn Somerville
(Reuters) - Wanted for the Treasury Department: a new boss who can fix trillion-dollar-plus budget deficits, overhaul the tax system and spur a reluctant Europe into fixing its debt crisis.
It's a tall order, especially when the new Treasury chief also must deal with a fractious Congress - and all for a salary lower than that paid to many junior Wall Street bankers.
The Growing Fed
By BINYAMIN APPELBAUM - NYTimes.com
One part of the economy that's growing rapidly is the Federal Reserve.
These are boom times for the central bank, which persuaded Congress to expand its responsibilities significantly in the wake of the financial crisis.
And with greater responsibility comes a larger budget. If not in every case, then at least in the case of the Fed, which as it happens sets its own budget.
Eileen Foster and the Failure of Corporate Criminal Justice Exposing Countrywide
by RUSSELL MOKHIBER - CounterPunch.org
Last month, Eileen Foster was at the National Press Club to receive the $10,000 Ron Ridenhour Prize for Truth-Telling. In 2007, Foster was a vice president in charge of investigating fraud at Countrywide Financial. A full time job, if you can keep it. Which she couldn't.
Because she took her job seriously.
A Countrywide employee in Boston called Foster with evidence of widespread loan fraud in the Boston area.
Foster investigated and confirmed the employee's report and eventually shut down six Countrywide offices in Massachusetts.
She started to pursue what appeared to be systemic fraud at the company when the executive suite got itchy.
On September 8, 2008, they came to Foster and put a 14-page document on her desk. Foster calls that a gag order. They also offered her $228,000. Foster calls that hush money. She was told if she accepted the money and signed the document, she could quit. If not, she would be fired.
She was fired.
Doug Casey on Taxes and Freedom, Part II
By Doug Casey - DailyReckoning.com
05/22/12 Louis James: Tax Freedom Day this year was April 17.
Doug: That means that all the work the average guy does until April 17 goes to pay for the government that failed to protect him on September 11, 2001, failed to protect him from the crash of 2008, and continues failing him every day. We pay for an organization bent on doing not just the wrong things, but the exact opposite of the right things in economics, foreign policy, and everything else we've talked about in all our conversations. It's rather perverse that Emancipation Day — the day the first slaves in the US were freed in the District of Columbia in 1862 — is April 16. But what is a slave? He's someone who is deprived by force of the fruits of his labor. Sound familiar? I disapprove of slavery, in any form — including its current form.
Tech giant HP to slash 27,000 jobs by 2014
By W.J. Hennigan - LATimes.com
Hewlett-Packard Co., the world's largest PC maker, will cut 27,000 jobs, or about 8 percent of its staff, by 2014 to bring down costs and make the company more competitive in a changing marketplace.
The move comes as consumer demand for the company's PCs plummets, and shifts toward tablets and smartphones.
The Palo Alto company also reported second quarter earnings of $1.59 billion, or 80 cents a share. That's down from last year's $2.3 billion, or $1.05 a share.
"We are making progress in our multi-year effort to make HP simpler, more efficient and better for customers, employees, and shareholders," Meg Whitman, HP's president and chief executive, said in a statement.
Fed near limit on scope to help jobs: Kocherlakota
By Kayla Gahagan
(Reuters) - A rise in U.S. inflation over the past year suggests the Federal Reserve has little firepower left to boost employment, a top Fed official said on Wednesday.
The U.S. unemployment rate, at 8.1 percent, is still high by historical standards, and many economists say employment is still well below the maximum level the economy can handle before inflationary pressures are likely to build.
Small dairies go under as milk prices sink again
By LISA RATHKE - MyFOXBoston.com
PLAINFIELD, Vt. (AP) - The MacLaren brothers are third-generation dairy farmers, but they will likely be the last in their family.
After working all their lives on the hillside farm in Vermont that their grandfather bought in 1939, rising to milk cows at 3 a.m., even in blizzards and sub-zero temperatures, they decided to call it quits, auctioning off their roughly 200 cows and equipment ranging from stalls and hoof trimmers to tractors and steel pails.
'Pro-choice' Americans found in record-low minority
By Cheryl Wetzstein-The Washington Times
A record low 41 percent of Americans identify themselves as "pro-choice" on abortion, according to a poll released Wednesday, while the number of Americans who say they are "pro-life" bounced back into the majority.
The results from the Gallup Poll survey confirm a sharp turnaround in personal attitudes about abortion in the 17 years since the polling firm first asked the question. In 1995, the first year of the poll, 56 percent of respondents described themselves as pro-choice on abortion, compared with 33 percent who were pro-life.
WILL OBAMA PULL AN LBJ AND DROP OUT?
by MIKE FLYNN - Breitbart.com
In 1968, the political world was shocked when President Lyndon Johnson, running for reelection just four years after a landslide victory, was held beneath 50% of the vote in the Democrat primary in New Hampshire. Sen. Eugene McCarthy scored a shocking 41.5% of the vote against the incumbent President.
The result confirmed Johnson's weakness going into the November general election. Within weeks, Sen. Robert Kennedy announced he would seek the Democrat nomination for President and Johnson announced that he would not. LBJ was bowing out of his reelection bid.
Rational People Fear Big Government, Not Big Business
By Dennis Prager - PatriotPost.us
You cannot understand the left if you do not understand that Leftism is a religion. It is not God-based (some Left-wing Christians' and Jews' claims notwithstanding), but otherwise it has every characteristic of a religion. The most blatant of those characteristics is dogma. People who believe in Leftism have as many dogmas as the most fundamentalist Christian.
One of them is material equality as the preeminent moral goal. Another is the villainy of corporations. The bigger the corporation, the greater the villainy. Thus, instead of the devil, the left has Big Pharma, Big Tobacco, Big Oil, the "military-industrial complex," and the like. Meanwhile, Big Labor, Big Trial Lawyers, and, of course, Big Government are leftwing angels. And why is that? Why, to be specific, does the left fear big corporations but not big government? The answer is dogma -- a belief system that transcends reason. No rational person can deny that big governments have caused almost all the great evils of the last century, arguably the bloodiest in history. Who killed the 20-30 million Soviet citizens in the Gulag Archipelago -- big government or big business? Hint: There were no private businesses in the Soviet Union. Who deliberately caused 75 million Chinese to starve to death -- big government or big business? Hint: See previous hint. Did Coca Cola kill five million Ukrainians? Did Big Oil slaughter a quarter of the Cambodian population? Would there have been a Holocaust without the huge Nazi state?
Groups Concerned Over Arming Of Domestic Drones
WASHINGTON (CBSDC) – With the use of domestic drones increasing, concern has not just come up over privacy issues, but also over the potential use of lethal force by the unmanned aircraft.
Drones have been used overseas to target and kill high-level terror leaders and are also being used along the U.S.-Mexico border in the battle against illegal immigration. But now, these drones are starting to be used domestically at an increasing rate.
Short sellers lining up to bet against Facebook
By Edward Krudy and Alistair Barr
(Reuters) - Short sellers desperate to bet against Facebook shortly after its debut on public markets are now getting their chance.
Shares of the much-anticipated IPO have fallen sharply since they opened at $42.05 on Friday amid an initial flurry of trading problems at theNasdaq and after news that top underwriters cut their revenue estimates just days before the offering.
Yet, short sellers are still eager to bet against the stock given its lofty valuation.
The Facebook IPO:
Shareholders Weren't Invited to the Real Party
By Matt Taibbi - RollingStone.com
A suit has been filed by Facebook shareholders against Mark Zuckerberg, Facebook, Morgan Stanley and others. It's based on a very simple concept: when internal analysts learned that Facebook's numbers were going to be worse than expected, the company and its bankers didn't tell everyone, but just "selectively disclosed" information to a small group of "preferred investors."
Henry Blodget, who unfortunately should know about these things, gave a good summary of it all on CBS This Morning:
I was on the phone last night with a former hedge fund CEO who was talking about this. "Facebook," he said, "is a colossal example of a complete clusterf--k where everybody wins except the ordinary investor."
Facebook IPO flop drawing increased scrutiny Regulators wonder whether Wall Street insiders heard data the public did not before stock trading began.
By Andrew Tangel and Stuart Pfeifer, Los Angeles Times
As Facebook shares continued their slide, regulators launched inquiries into whether privileged Wall Street insiders were alerted to the company's weakening financial projections, leading them to shun the stock or dump shares just as buying was opened to the public.
Morgan Stanley, which led the Wall Street effort to bring the social network public, came under fire following reports that the bank had told some favored clients that the bank was cutting its revenue estimates for Facebook. The lowered expectations came after the tech giant expressed caution in a public filing about its advertising sales on mobile devices.
Facebook founder Mark Zuckerberg
sees stock tumble amid IPO lawsuits Now they call it Fadebook – shareholders call in lawyers as stock price tumbles and regulators are not far behind
By Juliette Garside - Guardian.co.uk
Facebook's founder, Mark Zuckerberg, has gone from hero to zero as the stockmarket flotation of the decade flounders amid lawsuits and accusations of greed, hype and deception.
The law firm that won a $7bn settlement for Enron's shareholders is pursuing Zuckerberg, his board and the long list of banks advising the company for making "untrue statements" about its financial performance.
Facebook wants to start all over with IPO! Facebook Weighs Possible Listing With NYSE: Sources
CNBC.com
Is Facebook looking to make a change?
In the wake of a series of embarrassing technical glitches that marred Facebook's first day of trading on the Nasdaq, the social networking giant is now open to moving its listing to rival exchange New York Stock Exchange, according to two people familiar with the matter.
While these people say that multiple NYSE officials have reached out to Facebook regarding such a move, the NYSE maintains that "no discussions" have taken place, nor would those discussions "be appropriate at this time." Facebook remains open to engage in these discussions, according to people familiar with the matter.
Regulators, investors turn up heat over Facebook IPO
By Suzanne Barlyn and Ryan Vlastelica
(Reuters) - Two top U.S. financial regulators said on Tuesday the issues around the initial public offering of Facebook should be reviewed, putting fresh pressure on the company, its lead underwriter, Morgan Stanley, and the Nasdaq stock exchange.
Facebook shares closed 8.9 percent lower at $31, following an 11 percent plunge on Monday. At that price the company has shed more than $19 billion in market capitalization from its $38-per-share offering price last week.
Morgan Stanley to Adjust Prices on Facebook Trades
Reuters - CNBC.com
Morgan Stanley told brokers on Wednesday it is reviewing every Facebooktrade and will make price adjustments for retail customers who paid too much during the social network company's debut last week, according to an internal memo.
Morgan Stanley, the lead underwriter of Facebook's initial public offering on Friday, in the memo also said "many" of the first-day trades have now been processed and are appearing in client accounts. The company did not specify how much it expected to pay in total price adjustments.
Senate Cybersecurity Bills Under Fire From CISPA Opponents
By CARL FRANZEN - TalkingPointsMemo.com
Fearing that the U.S. Senate will soon vote to pass a cybersecurity bill that could erode Web user privacy, a prominent Internet freedom advocacy group has launched a new online campaign to get the American public to confront Senators face-to-face during their weeklong Memorial Day recess at the end of the month.
Fight For the Future, a nonprofit advocacy group that in late 2011 helped launch the successful massive online protest against the much-hated anti-online bill known as SOPA (the Stop Online Piracy Act), is turning to some of the same tactics that helped kill that bill.
China fake parts 'used in US military equipment'
BBC.co.uk
Vast numbers of counterfeit Chinese electronic parts are being used in US military equipment, a key Senate committee has reported.
A year-long probe found 1,800 cases of fake parts in US military aircraft, the Senate Armed Services Committee said.
More than 70% of an estimated one million suspect parts were traced back to China, the report said.
It blamed weaknesses in the US supply chain, and China's failure to curb the counterfeit market.
Cutting the Cord on Cable TV's Pricey Monthly Bill
By Barbara Thau - DailyFinance.com
OK, so you can't stand to miss Bravo's The Real Housewives of Atlanta or those great documentaries on The History Channel (we admire your eclectic tastes), but are thosesteep cable bills making you want to pull out your hair along with the cable wires?
Take a deep breath. The era of digitized content is ushering in a new wave of cost-saving viewing: From streaming-video websites to digital media providers, these alternatives to cable TV might prompt you to chuck the cable box for good.
The High Cost of Cable
For the price that many Americans pay for cable TV, they can enjoy a mini vacation. A digital cable package from Comcast, for example, costs $551.98 per year, just for the basics.
RealD signs deal with China's Bona Film Group
By Richard Verrier - LATimes.com
Beverly Hills-based RealD Inc. is further expanding its presence in China.
The 3-D equipment supplier said Wednesday it had a signed a deal to install 100 3-D screens for the Bona Film Group's theater circuit in China. Bona, a leading film distributor in China, plans to install RealD 3-D systems at each of the company's 11 theater locations.
Scientists turn skin cells into beating heart muscle
By Kate Kelland
LONDON, May 23 (Reuters) - Scientists have for the first time succeeded in taking skin cells from patients with heart failure and transforming them into healthy, beating heart tissue that could one day be used to treat the condition.
The researchers, based in Haifa, Israel, said there were still many years of testing and refining ahead. But the results meant they might eventually be able to reprogram patients' cells to repair their own damaged hearts.
Superior Biotechnology Leads to Superior Drugs
By Ray Blanco - DailyReckoning.com
05/23/12 We sometimes hear about diminishing returns in cancer research and development in the big pharmaceutical companies. They tell us, traditional drug discovery techniques have picked most of the low-hanging fruit in the field. Cancer cells are tricky devils, able to quickly mutate resistance to our best available therapies.
Revolutions in our understanding of the genome and proteome, however, are opening up new pathways toward vanquishing the cancer foe…
Mark of the Beast:
Bilderberg Pushes Mandatory Internet ID for Europe
By Aaron Dykes - Infowars.com
While the international ACTAtreaty and United States' CISPAlegislation are setting the stage to clamp down on the world wide web, technocrats are working overtime to try to pin down your identity and make sure all your activities are thoroughly monitored and under control.
The European Union is now moving to create a mandatory electronic ID system for all EU citizens that would be implemented across Europe to standardize business both online and in person, authenticating users via a common 'electronic signature.' A single authenticating ID would guard access to the Internet, online data and most commerce. It is nothing short of an attempt to phase in a Mark of the Beast system, and a prominent Bilderberg attendee is behind the scheme.
Barcode everyone at birth
BBC.co.uk
This week science fiction writer Elizabeth Moon argues that everyone should be given a barcode at birth.
"If I were empress of the Universe I would insist on every individual having a unique ID permanently attached - a barcode if you will; an implanted chip to provide an easy, fast inexpensive way to identify individuals.
It would be imprinted on everyone at birth. Point the scanner at someone and there it is.
A Catholic Spring?
By E.J. Dionne, Jr. - Truthdig.com
There is a healthy struggle brewing among the nation's Roman Catholic bishops. A previously silent group, upset over conservative colleagues defining the church's public posture and eagerly picking fights with President Obama, has had enough.
The headlines this week were about lawsuits brought by 43 Catholic organizations, including 13 dioceses, to overturn regulations issued by the administration requiring insurance plans to cover contraception under the new health care law. But the other side of this news was also significant: That the vast majority of the nation's 195 dioceses did not go to court.
Vatican moving toward a 'universal' church (i.e. one-world religion)
Cardinal Zen: Day of prayer,
consolation of the Universal Church
for persecuted Chinese Catholics
Paris (AsiaNews / EDA) - The World Day of Prayer for the Church in China, which is celebrated tomorrow, May 24, is a "consolation" for the Chinese Catholic communities still persecuted by a regime that wants to dominate them. The Day is also an expression of the Pope's care and "concern" for the Church in China. This according to Card. Joseph Zen, bishop emeritus of Hong Kong, who explains the value of the day desired by Benedict XVI, in conjunction with the feast of Our Lady of Sheshan, the sanctuary of China, a few kilometers from Shanghai. Card. Zen is in France to attend the "Night of the witnesses," prepared by a meeting of "Aid to the Church in Need." In the interview,published on the Eglises d'Asie website, he also comments on some conclusions regarding the work of the Vatican Commission for the Church in China and the situation of the Chinese Church, marked by "confusion" created by Beijing particularly through the illegitimate ordination of bishops. Here we publish excerpts of the interview.
Fukushima: If Number 4 Collapses,
Japan Will Be Evacuated
By Kurt Nimmo - Infowars.com
Chris Canine – who has 15 years experience as a health physics technician, chemist and radiation safety instructor – toldEnergy News that if number 4 reactor fuel pool at Fukushima collapses, Japan will be evacuated.
He did not elaborate on how such a logistical nightmare would be accomplished.
Canine worked at Fukushima in the late 1970s and has also worked at over twenty nuclear plants in the United States, Japan and Mexico.
Bipartisan Support for Sanctions Spells Bloodshed to Come
War With Iran Has Already Begun
by NATHAN FULLER - CounterPunch.org
On Friday, 93% of the U.S. House of Representatives affirmed a resolution escalating America's already aggressive position on Iran, from "crippling" sanctions to a zero-tolerance policy on nuclear weapons. The Congressional Research Service summarized the bill (emphasis mine):
Affirms that it is a vital national interest of the United States to prevent Iran from acquiring a nuclear weapons capability and warns that time is limited to prevent that from happening. Urges increasing economic and diplomatic pressure on Iran to secure an agreement that includes: (1) suspension of all uranium enrichment-related and reprocessing activities, (2) complete cooperation with the International Atomic Energy Agency (IAEA) regarding Iran's nuclear activities, and (3) a permanent agreement that verifiably assures that Iran's nuclear program is entirely peaceful. Supports: (1) the universal rights and democratic aspirations of the Iranian people, and (2) U.S. policy to prevent Iran from acquiring nuclear weapons capability. Rejects any U.S. policy that would rely on efforts to contain a nuclear weapons-capable Iran. Urges the President to reaffirm the unacceptability of an Iran with nuclear-weapons capability and oppose any policy that would rely on containment as an option in response to the Iranian nuclear threat.
Iran-cornerstone-of-possible-WW3-over-Mid-East
Tensions are once again mounting against Iran ahead of a crucial report by the UN nuclear watchdog, IAEA, due next week. Meanwhile, Israel has tested a new ballistic missile. Some reports go even further and suggest the idea of a military strike on the Islamic Republic is being pushed by Israeli Prime Minister Benjamin Netanyahu. And British media say that with Iran remaining resilient against international sanctions, the attack could come as soon as next November. Various media cite the UK Ministry of Defense and Whitehall as their sources.
Renewed Iranian Calls for Israel's 'Annihilation'
By Arnold Ahlert - PatriotPost.us
While new talks resume to buy the Islamic Republic more time.
Monday, International Atomic Energy Agency (IAEA) head Yukiya Amano met with Fereidoun Abbasi-Davani, head of the Atomic Energy Organization of Iran (AEOI), in an initial conference over Iran's nuclear program. The Iranian Fars News Agency said the meeting represented the "eagerness" of the UN to "further develop cooperation with Iran in various areas of nuclear applications," and it is clear the rosiness of the state media's characterization is not without good reason. For, while the West is banking everything on an appeasement strategy with Iran, the Islamic Republic is busy broadcasting to the world its Hitlerian intentions to annihilate Israel, daring the international community to bat an eyelash.
* * * * *
How do your spell Agenda 21 implementation locally... ICLEI AGENDA 21 CONSPIRACY THEORY OR THREAT - PART 1 of 2
by Tom DeWeese - NewsWithViews.com
The battle over Agenda 21 is raging across the nation. City and County Councils have become war zones as citizens question the origins of development plans and planners deny any international connections to the UN's Agenda 21. What is the truth? Since I helped start this war, I believe it is up to me to help with the answers.The standard points made by those who deny any Agenda 21 connection is that:
• Local planning is a local idea.
• Agenda 21 is a non-binding resolution not a treaty, carries no legal authority from which any nation is bound to act. It has no teeth.
• The UN has no enforcement capability.
• There are no "Blue-Helmeted" UN troops at City Hall.
• Planners are simply honest professionals trying to do their job, and all these protests are wasting their valuable time.
• The main concern of Agenda 21 is that man is fouling the environment and using up resources for future generations and we just need a sensible plan to preserve and protect the earth. What is so bad about that?
• There is no hidden agenda.
• "I've read Agenda 21 and I can find no threatening language that says it is a global plot. What are you so afraid of?"
• And of course, the most often heard response – "Agenda 21, what's that?"
• And after they have proudly stated these well thought out points, they arrogantly throw down the gauntlet and challenge us to "answer these facts."
• Well, first I have a few questions of my own that I would love to have answered.
Why You Should Be Concerned About ICLEI?
AntiICLEI.com
ICLEI = International Council for Local Environmental Initiatives
Taking care of our environment, developing energy independence, and planning for the future is a responsible approach to living. However, the green/environmental/sustainable movement consistently demonstrates their lack of concern for the people who live on the planet. Many green-labeled practices actually cause more damage to the environment.
"Global sustainability requires the deliberate quest of poverty, reduced resource consumption and set levels of mortality control." -Professor Maurice King
Birth of an abomination
In simple terms Agenda 21/Sustainable Development is the end of civilization as we know it. It is the end of private property, the elevation of the collective over the individual. It is the redistribution of America's wealth to the global elite, it is the end of the Great American Experiment and the Constitution. And, it is the reduction of 85% of the world's population.
In 1992, twenty years ago this summer, Agenda 21/Sustainable Development was unveiled to the world at the UN's Earth Summit in Rio. (While Agenda 21 was introduced in June, 1992, it was already installed as public policy in communities across the country as early as 1987.)
Why America Should Declare Bankruptcy Now
By Peter Schiff - TheFiscalTimes.com
If the U.S. government were a private company being audited by standard practices, it would be considered much further in the red than official national debt figures show. It would, in fact, be shut down and its key executive prosecuted for fraud.
The national debt is $15 trillion. Let me try to put that huge number in perspective.
All federal tax revenue in 2011 was $2.2 trillion — less than one sixth of the total national debt. The $15 trillion debt amounts to $133,000 per taxpayer. The richest person in America, Bill Gates, has a total net worth of $59 billion. If he donated every dime to the U.S. Treasury in order to pay down the national debt, he couldn't even retire one half of one percent of the debt. Put another way, he could pay two months' of interest.
The Dollar Oil Price Threat Will Hurry Gold's Role in the System
By: Julian D. W. Phillips - GoldSeek.com
There was much more to Hilary Clinton's China and India trip than meets the eye. It was an acid test of the power of the U.S. to press its political will upon the world. The issue at hand was the U.S. trying to halt sales of Iranian oil worldwide and to offer India the same amount of oil from other sources. Supplies from Saudi Arabia to replace Iranian oil were already in the market place. The halting of the Iranian oil from the market would have lost 3 million barrels a day, but it seems Saudi oil capacity has added that much.
Dollar Index Reaches 20-Month High Before EU Summit Today
By Masaki Kondo and Mariko Ishikawa - Bloomberg.com
The Dollar Index (DXY) reached a 20-month high before European Union leaders meet today amid concern Greece will exit the euro bloc, boosting demand for the U.S. currency as a haven.
The 17-nation euro was 0.2 percent from a four-month low as elections loom in Greece on June 17 that may determine whether the nation stays in the currency union. The yen held a two-day drop after Japan posted a wider-than-estimated trade deficit and before the nation's central bank concludes a meeting today.
The Economy, the Fed, Gold, and Gold Shares
BY GEORGE KARAHALIOS - FinancialSense.com
To clarify where we stand, I think the gold shares might have made THE cyclical low last Wednesday. This conclusion is predicated on a number of factors: the valuation of gold shares relative to gold hasn't been this cheap since the 2008 deleveraging crisis, pessimism among gold equity holders reached a crescendo often marked by bear market bottoms, and the macro roadmap that I foresee which should ignite gold to resume both its cyclical and secular bull markets. While I haven't been particularly accurate over the past year in regards to gold or gold shares, every day of investing is a new day and it's important to recognize a circumstance for what it is, not for what it might have been.
A Global New Deal
By Jomo Kwame Sundaram - Project-Syndicate.org
NEW YORK – Recent political developments, including the defeat of incumbent governments in France and Greece, suggest that the public's tolerance for economic policies that do not reduce unemployment has collapsed. Indeed, given the alarming economic and employment situation in many countries today, with no prospect of recovery on the horizon, further political turmoil is likely unless policymakers change course accordingly.
The economic crisis has wiped out more than 50 million jobs after years of weak, job-poor growth and increasing inequality in the world's rich countries. Since 2007, employment rates have risen in only six of the 36 advanced economies, while youth unemployment has increased in a large majority of both established and emerging markets.
EU commission to outline plans for political union
BY HONOR MAHONY - EUObserver.com
BRUSSELS - The European Commission has said it will soon bring forward plans for an economic and political union it says is necessary for the creation of debt-mutualising eurobonds - one of the most controversial proposed solutions to the current eurozone crisis.
"We need to reflect what kind of European union would be required to deepen economic and political integration, for instance so that joint issuance of debt would make sense for all member states sharing the single currency," economics commissioner Olli Rehn told MEPs on Tuesday (22 May).
OECD fears euro woe to snap brittle world recovery
By Leigh Thomas
(Reuters) - The United States and Japan are leading a fragile developed world recovery that could be blown off course if Europe fails to contain the damage from its problem debtor states, the OECD said on Tuesday.
It urged euro zone leaders to embrace all options for tackling the crisis, potentially including common bonds to go with the common currency.
In its twice-yearly economic outlook, the Paris-based Organisation for Economic Co-operation and Development forecast that global growth would ease to 3.4 percent this year from 3.6 percent in 2011, before accelerating to 4.2 percent in 2013, in line with its last estimates from late November.
War-Gaming Greek Euro Exit
Shows Hazards In 46-Hour Weekend
By Jana Randow and Gabi Thesing - Bloomberg.com
Greece may have only a 46-hour window of opportunity should it need to plot a route out of the euro.
That's how much time the country's leaders would probably have to enact any departure from the single currency while global markets are largely closed, from the end of trading in New York on a Friday to Monday's market opening in Wellington, New Zealand, based on a synthesis of euro-exit scenarios from 21 economists, analysts and academics.
The Euro Awaits Its Verdict
By Peter Boone, Simon Johnson - Project-Syndicate.org
WASHINGTON, DC – The creation of the euro just over a decade ago was a courageous and unique experiment. Today, the outcome – whether the euro will survive, and whether the Europeans are right to keep it – is very much in doubt. But, if the eurozone does survive, it promises great advantages for member countries – and perhaps for the world.
The euro is an ultra-fixed currency among members: participating countries locked themselves into an initial exchange rate vis-à-vis their pre-existing currencies and then threw the keys into the long grass. Nowadays, an increasing number of Europeans are combing that grass, quietly looking for those keys.
Merkel Faces Hollande Pleas
To Shed Taboos At 18th Crisis Summit
By James G. Neuger - Bloomberg.com
A plea to shed "taboos" may put German Chancellor Angela Merkel in a corner today as she digs in against joint debt sales to counter Europe's financial crisis.
Merkel, the dominant figure in more than two years of crisis-fighting, heads to a Brussels summit unable to stifle calls for measures she opposes, including euro bonds, the use of European money to recapitalize banks, a bigger rescue fund and extra time for debt-swamped countries to cut spending.
German bank tables plan for parallel Greek euro
BY VALENTINA POP - EUObserver.com
BRUSSELS - Germany's financial giant Deutsche Bank has floated the idea of a "geuro" - a parallel currency allowing Greece to devaluate while staying in the eurozone if an anti-bail-out government takes over in Athens.
If left-wing radicals win the 17 June elections in Greece and stick to their promise of scrapping the €130 billion bail-out and its austerity requirements, Greece could still stay in the eurozone without financial aid if it introduced a parallel currency, says a Deutsche Bank study published on Monday (21 May).
World Bank Says Asia Must Watch Inflation As Expansion Slows
By Karl Lester M. Yap and Michael Heath - Bloomberg.com
The World Bank said policy makers in Asia's emerging economies must guard against inflation risks and be prepared to reverse policy easing, even as slowing growth in China and Europe's sovereign-debt turmoil hurt exports.
Growth in developing East Asia, which excludes Japan and India, will probably ease to 7.6 percent this year from 8.2 percent in 2011, the Washington-based lender said in a report today. In November, the forecast for 2012 was 7.8 percent. The region's reliance on European demand and Chinese commodities consumption make it vulnerable to slowdowns in those markets, the World Bank said.
Japan's fiscal death is a warning to the West Fitch Ratings has downgraded Japan two notches to A+, citing a surge in public debt since the Lehman crisis and the lack of any plan to restore fiscal probity.
By Ambrose Evans-Pritchard - Telegraph.co.uk
Key indicators are deteriorating on almost every front, raising concerns that the world's third largest economy is running aground after two "Lost Decades".
Japan's debt has jumped by 61 percentage points of GDP since 2008, compared to eight points for the AAA bloc. Public debt is expected to reach 239pc of GDP this year, uncharted levels for a major economy in peace-time. `Net debt' – subtracting Japan's vast holdings of foreign bonds – is nearer 137pc but this is rising at an even steeper trajectory.
China Warns Australia to Choose "Godfather" - China or U.S.
By John Daly - OilPrice.com
It is rare in diplomatic circles for governments to speak bluntly, particularly in the Orient, where manners are highly prized.
The exceptions to this rule are retired military officers, who are often able to voice sentiments too impolitic for other channels.
One of the more startling pronouncements in this vein occurred last week when Song Xiaojun, a former senior officer of the People's Liberation Army, warned that Australia cannot juggle its relationships with the United States and China indefinitely and "Australia has to find a godfather sooner or later. Australia always has to depend on somebody else, whether it is to be the 'son' of the US or 'son' of China. (It) depends on who is more powerful, and based on the strategic environment." Noting the rising importance of China as an export market Song added that Australia depended on exporting iron ore to China "to feed itself," but "Frankly, it has not done well politically."
JPMorgan's Losses Become Tool In Dodd-Frank Rules Debate
By Phil Mattingly and Silla Brush - Bloomberg.com
U.S. lawmakers and regulators are seizing on the more than $2 billion in losses disclosed byJPMorgan Chase & Co. (JPM) to bolster their positions in the nearly two-year-old debate over Wall Street's rules.
The Senate Banking Committee was the flash point for the debate yesterday, as Democrats and the chairman of the Commodity Futures Trading Commission used the losses to argue for the strict implementation of the 2010 Dodd-Frank Act rules, including a ban on proprietary trading by banks. That argument may shift to lawmakers and regulators pushing to go beyond President Barack Obama's financial regulatory overhaul.
JPMorgan's Senior Officers' Addiction
to Gambling on Derivatives
BY WILLIAM K BLACK PHD - FinancialSense.com
JPMorgan's flacks and apologists have, unintentionally, exposed the fact that their cover story – hedging gone bad – is false. JPMorgan runs the world's largest gambling operation in financial derivatives. The New York Times reported the key facts, but not the analytics, in an article entitled "Discord at Key JPMorgan Unit is Faulted in Loss." The analytics suggest that the latest JPMorgan cover story – it was JPMorgan's "Achilles the heel" (based in the UK) who caused the loss – is misleading.
Obama Administration Walks Volcker Rule Tightrope
By BRIAN BEUTLER - TalkingPointsMemo.com
The Obama administration will likely tighten rules to prevent federally insured banks from speculating with their money after financial giant JP Morgan lost billions of dollars — and continues to hemorrhage — on a risky bet intended to pad the firm's profits.
The acknowledgment by a senior administration official Monday threatens to reopen a protracted fight between Wall Street allies and the White House over imposing new rules on big financial companies in the wake of the 2008 crisis.
SEC Focusing On JPMorgan's Disclosure Of Risk Models
By Steven Sloan and Dawn Kopecki - Bloomberg.com
U.S. Securities and Exchange Commission Chairman Mary Schapiro said the agency is "very focused" on determining whether JPMorgan Chase & Co. (JPM) appropriately disclosed changes it made during the first quarter to a complex risk calculation.
"We are very focused on the accuracy and timeliness of that disclosure," she said yesterday during an appearance before the Senate Banking Committee in Washington.
Keiser Report: Scatological Finance (E291)
In this episode, Max Keiser and co-host, Stacy Herbert, discuss naked short selling by Goldman Sachs and piling on JP Morgan all while being hounded by a Fox News helicopter. In the second half of the show Max talks to Francine McKenna of reTheAuditors.com about Jamie Dimon, London whales and MF Global.
Congress staring over edge of 'fiscal cliff' Lawmakers face budget dilemma
By Stephen Dinan-The Washington Times
For Congress, the outlines of the pending fiscal crisis are clear: Don't do a thing, and watch the economy slip into a double-dip recession early next year. Or cancel the looming tax increases and spending cuts, watch the deficit rise, and push the government ever closer to a European-style debt crisis.
That decision was put in stark terms Tuesday by the Congressional Budget Office, which in a new analysis said the economy will plunge into a recession early next year if Congress lets taxes rise and spending be cut, as called for under the law.
Glass-Steageall would not have prevented 2008 Reinstating an Old Rule Is Not a Cure for Crisis
BY ANDREW ROSS SORKIN - NYTimes.com
Call it the Glass-Steagall myth.
Since JPMorgan Chase announced its surprise $2 billion, and growing, trading loss there have been renewed calls from economists, pundits and politicians to reinstate the Glass-Steagall Act, a Depression-era law that prevented commercial banks from participating in investment banking activities.
Elizabeth Warren, the Democratic candidate for Senate in Massachusetts, sent an e-mail to thousands of her constituents, pressing to bring back the law, which she said, "stopped investment banks from gambling away people's life savings for decades — until Wall Street successfully lobbied to have it repealed in 1999."
California Man Commits Suicide Before Foreclosure
By LYNEKA LITTLE - ABCnews.com
"The engine is smoking like a chimney," Norman Rousseau told his wife after working on an RV that was expected to be home for the couple after they were evicted from their house in Newbury Park, Calif.
Those would be the last words Oriane Rousseau heard from her husband, who shot himself May 15, days before the couple were scheduled to be evicted after a long battle over their mortgage held by Wells Fargo.
Modest Proposals for Financial Reform:
Abolish Mortgage-Backed Securities
Dr. Manhattan - TheAtlantic.com
....Abolish Mortgage-Backed Securities (and Offspring)
CDOs and credit default swaps don't kill financial systems, mortgages kill financial systems.
There has been altogether too much opproprium directed at CDOs, credit default swaps and other structuring techniques that spread financial contagion, and not enough directed at the underlying collateral. The record seems to be, however, that Dick Pratt was correct when he called the mortgage "the neutron bomb of financial products."
Billion Dollar Bait & Switch:
States Divert Foreclosure Deal Funds
by Paul Kiel and Cora Currier - ProPublica.org
States have diverted $974 million from this year's landmark mortgage settlement to pay down budget deficits or fund programs unrelated to the foreclosure crisis, according to a ProPublica analysis. That's nearly forty percent of the $2.5 billion in penalties paid to the states under the agreement.
The settlement, between five of the country's biggest banks and an alliance of almost all states and the federal government, resolved allegations that the banks deceived homeowners and broke laws when pursuing foreclosure. One part of the settlement is the cash coming to states; the deal urged states to use that money on programs related to the crisis, but it didn't require them to.
Where Are the Foreclosure Deal Millions Going in Your State?
by Paul Kiel, Lena Groeger and Cora Currier - ProPublica.org
As part of the mortgage settlement finalized in April, 2012, the five biggest banks agreed to pay $2.5 billion to 49 states and the District of Columbia. ProPublica contacted every state to determine whether the money will be going to consumer-focused efforts related to the settlement or not. See below for a breakdown of each state's share. This graphic will be updated periodically as more states announce their allocations.
Big Lies in Politics
By Thomas Sowell - PatriotPost.us
The fact that so many successful politicians are such shameless liars is not only a reflection on them, it is also a reflection on us. When the people want the impossible, only liars can satisfy them, and only in the short run. The current outbreaks of riots in Europe show what happens when the truth catches up with both the politicians and the people in the long run.
Among the biggest lies of the welfare states on both sides of the Atlantic is the notion that the government can supply the people with things they want but cannot afford. Since the government gets its resources from the people, if the people as a whole cannot afford something, neither can the government.
Facebook Analysts Who Shunned Herd Now Look Like Heroes
By Inyoung Hwang and Danielle Kucera - Bloomberg.com
Analysts who broke away from the herd and told investors to avoid Facebook Inc. (FB), the biggest initial public offering ever by a technology company, are looking like heroes after the stock plunged.
The social networking site lost 19 percent through yesterday to $34.03 after opening at $42 on May 18. That's consistent with warnings from Richard Greenfield of BTIG LLC and Brian Wieser of Pivotal Research Group LLC, who says the stock will slip as low as $30. It left five firms with bullish calls predicting an average rally of 36 percent and one, Tom Forte of Telsey Advisory Group, saying shares may rise 47 percent to $50.
The Facebook Fallacy For all its valuation, the social network is just another ad-supported site. Without an earth-changing idea, it will collapse and take down the Web.
By Michael Wolff - TechnologyReview.com
Facebook is not only on course to go bust, but will take the rest of the ad-supported Web with it.
Given its vast cash reserves and the glacial pace of business reckonings, that will sound hyperbolic. But that doesn't mean it isn't true.
At the heart of the Internet business is one of the great business fallacies of our time: that the Web, with all its targeting abilities, can be a more efficient, and hence more profitable, advertising medium than traditional media. Facebook, with its 900 million users, valuation of around $100 billion, and the bulk of its business in traditional display advertising, is now at the heart of the heart of the fallacy.
Zucked! Regulators to Review Morgan Stanley Facebook Allegations
Reuters - CNBC.com
The Financial Industry Regulatory Authority's chairman said on Tuesday that regulators plan to review allegations that Morgan Stanley shared negative news before Facebook's initial public offering with institutional investors.
"The allegations, if true, are a matter of regulatory concern" to FINRA and SEC, Ketchum told Reuters.
How Facebook could destroy the U.S. economy Too-big-to-fail mentality replays the dot-com bubble
By Paul B. Farrell, MarketWatch
SAN LUIS OBISPO, Calif. (MarketWatch) — Facebook just joined a "troubled club," warns the Economist. Now it's just another "endangered public company."
Yes, endangered. The number of public companies has declined 37% since 1997. The number of IPOs has dropped from 311 annually before 2000 to 99 the past decade. Meanwhile, the smart CEOs and the Super Rich are "going private," to avoid government red tape restricting capitalism.
Wall Street struggles to find Facebook's worth
By Rodrigo Campos
(Reuters) - In its three days of trading, Facebook's stock has dropped 18 percent from its $38 issue price. For the thousands of investors that bought at the IPO, that's bad enough, but one analysis of itsearnings prospects suggests it could get a lot worse - more like $10 a share.
Setting aside the hype and the cultural phenomenon that is the online networking site, Facebook Inc would be fairly priced at $9.59, according to the smattering of Wall Street estimates analyzed and modeled by Thomson Reuters StarMine.
Do You Care? I Don't
By William Murchison - PatriotPost.us
All the Facebook tabulation of recent days -- whatever it may have meant to Mark Zuckerberg and his brokers -- brought to certain others in the great extended American community a certain sense of relief. It is not essential -- a matter of destiny -- some of us now know, to buy into the whole Facebook thing or for that matter even a sliver of it. We can safely ignore the whole thing. That is what we have learned by reading about Facebook. I have, anyway.
A story over the weekend put the number of "seniors" who use Facebook at no more than a third. I cannot say what the reporter meant by "seniors." My uninformed guess would be that he meant people who remember the Kennedy assassination. This takes care, I think I can safely say, of the great majority of folk who might expect to communicate with me by means of Zuckerberg's miracle.
Arizona Sheriff Joe Arpaio Ratchets Ups the Birther Probe
Sheriff Joe Arpaio Sends 'Threats Unit' Investigator To Hawaii To Escalate Birther Probe
By NICK R. MARTIN - TalkingPointsMemo.com
Not to be outdone by the Arizona secretary of state's recent flirtation with birtherism, Sheriff Joe Arpaio escalated his probe into President Obama's birth certificate this week by dispatching a deputy from his "threats unit" to Hawaii.
Both the Arizona Republic and the Honolulu Star-Advertiser reported deputy Brian Mackiewcz traveled with Arpaio's volunteer posse member Michael Zullo on Monday to try to get an official confirmation that Hawaii has the president's birth certificate on file.
Emails Show How Hawaii Stiffed Arizona
Secretary Of State's Birther Investigation
By NICK R. MARTIN - TalkingPointsMemo.com
One of the more amusing things revealed last week when Arizona's secretary of state came out as birther curious was that Hawaii officials just simply don't believe he's qualified to investigate Barack Obama's birth certificate.
Sure, Ken Bennett says he's the man in charge of deciding whether President Obama is eligible to be on Arizona's ballot in November, but the response from people in Hawaii's government has been: Prove it. In essence, they're giving Bennett a taste of his own medicine, making him jump through a series of hoops to prove he has the legal authority to investigate the matter, much the same way the birthers have made Hawaii prove time and time again that the president is indeed a natural born citizen of the United States.
In Race For Better Cell Service,
Men Who Climb Towers Pay With Their Lives
By Ryan Knutson, PBS Frontline, and Liz Day, ProPublica.org
In the spring of 2008, AT&T was racing to roll out a new cell phone network to deliver music, video and online games at faster speeds.
The network, known as 3G, was crucial to the company's fortunes. AT&T's cell service had been criticized by customers for its propensity to drop calls, a problem compounded when the company became the sole carrier for the iPhone.
Jay Guilford was a tiny but vital cog in the carrier's plans.
IBM Outlaws Siri, Worried She Has Loose Lips
By Robert McMillan - Wired.com
If you work for IBM, you can bring your iPhone to work, but forget about using the phone's voice-activated digital assistant. Siri isn't welcome on Big Blue's networks.
The reason? Siri ships everything you say to her to a big data center in Maiden, North Carolina. And the story of what really happens to all of your Siri-launched searches, e-mail messages and inappropriate jokes is a bit of a black box.
New Fuel Injection System
to make Petrol Engines as Efficient as Hybrids
By Brian Westenhaus - OilPrice.com
Delphi is developing an engine fuel injection technology that could improve the fuel economy of gas-powered cars by 50 percent, potentially rivalling the performance of hybrid vehicles at less cost. Their test engine based on the technology is similar in some ways to a highly efficient diesel engine, but runs on gasoline.
Delphi's approach, called gasoline-direct-injection compression ignition combines a collection of engine-operating strategies that make use of advanced fuel injection and air intake and exhaust controls, many of which are available on advanced engines today.
SpaceX In Orbit – Successful Launch of Falcon 9 Rocket
By Jason Paur - Wired.com
CAPE CANAVERAL, Florida — The second time's the charm for SpaceX. This morning at 3:44 a.m. EDT the company's Falcon 9 rocket lifted off Launch Complex 40 at Cape Canaveral. After a faulty valve led to an aborted launch on Saturday, today's successful flight marks the third of the Falcon 9 rocket, the second flight of the Dragon capsule, and the first flight for a commercial spacecraft bound for the International Space Station (ISS).
Darpa, Venter Launch Assembly Line for Genetic Engineering
By Katie Drummond - Wired.com
The military-industrial complex just got a little bit livelier. Quite literally.
That's because Darpa, the Pentagon's far-out research arm, has kicked off a program designed to take the conventions of manufacturing and apply them to living cells. Think of it like an assembly line, but one that would churn out modified biological matter — man-made organisms — instead of cars or computer parts.
Revisit the late 60s... In an Echo of Vietnam Protests,
Veterans of Iraq and Afghanistan Throw Back Medals
During the Chicago NATO Protests
Lucy Steigerwald - Reason.com
Via The Guardian, here's April 23, 1971 where hundreds of classic hippie-looking folks who were once fighting in Vietnam threw back their medals from that war and did things like call those medals "a bunch of bullshit." One said, "I got a purple heart here and I hope I get another one fighting these motherf---ers."
And here is Sunday in Chicago where a more diverse group (at least, there were multiple ladies, though a few mothers apparently joined in the '71 protest in honor of their deceased sons) of around 50 veterans who repeated that symbolic gesture. They threw their medals earned in Afghanistan and Iraq back in the general direction of NATO. Some apologized to the people of those countries as they did so. One said "I don't want any part of this anymore. I chose human life over war, militarism and imperialism."
War Veterans Protest, Throw Their Medals at NATO Summit!
May 20, 2012 CHICAGO (Reuters) - Nearly 50 U.S. military veterans at an anti-NATO rally in Chicago threw their service medals into the street on Sunday, an action they said symbolized their rejection of the U.S.-led wars in Iraq and Afghanistan.
Scientists Studying the Link between Fracking
and Recent Earthquakes in Texas
By Climate Progress - OilPrice.com
Scientists from two Texas universities are looking into a pair of recent earthquakes near the Texas-Louisiana border for clues to whether they were related to underground injection of oil and gas drilling waste produced in the course of hydraulic fracturing or fracking.
One of the scientists studying the two recent Texas quakes was on a team that concluded a swarm of earthquakes near Dallas in 2008 and 2009 were related to the disposal of drilling wastes, according to E&E's Energy Wire.
Cliff Frohlich, a research scientist at the University of Texas who studied those Dallas area quakes, did not rule out a similar conclusion in the recent east Texas quakes.
"It's possible they were natural," he said. "It's possible they were man-made."
Iran and IAEA Reportedly Close to Agreement
By MICHAEL BROOKS - TalkingPointsMemo.com
Iran and the International Atomic Energy Agency are close to signing an agreement according to IAEA head Yukiya Amano.
Mr. Amano told reporters that an agreement that would pave the way for a more thorough international investigation of the Iranian nuclear program would be signed "quite soon."
Amano's comments came shortly after returning to his organization's headquarters in Vienna, after holding talks with Iran's chief nuclear negotiator Saeed Jalili in Tehran over the weekend.
The Nixon Option for Iran?
By William H. Luers, Thomas R. Pickering - Project-Syndicate.org
WASHINGTON, DC – Rearranging the deck chairs would not have saved the Titanic. Nor did the endless debates on the shape of the table in the Vietnam negotiations advance the effort to end that malign conflict. Nevertheless, many American presidents have successfully redesigned talks with adversaries in bold new ways to strengthen national security without war. Such boldness is now needed in the negotiations over Iran's nuclear program.
In 1933, Franklin D. Roosevelt negotiated personally with Soviet Foreign Minister Maxim Litvinov to open diplomatic relations between the two countries. Dwight D. Eisenhower invited Nikita Khrushchev to the United States in 1959 to open the eyes of the first Soviet leader ever to visit America. The bilateral US-China talks in Warsaw in the 1960's were fruitless until Richard M. Nixon and National Security Adviser Henry Kissinger opened a different, more direct discussion through the auspices of Pakistan.
Barclays retains bullish view on Gold
LONDON (Commodity Online): Barclays Capital retain a bullish view on gold given the ongoing market uncertainty, broader macro backdrop remaining gold-positive and continued central bank buying.
Barclays continued that, "Gold has slipped lower and, in our view, two factors will determine its floor:
--Support from the physical market, where volumes have picked up in China and the WGC reported a record quarter in Q1 12.
Gold has potential to rise again
NEW YORK (Commodity Online): Gold has potential to rise again, said Commerzbank in a commodities research note. Commerzbank AG is the second-largest bank in Germany, after Deutsche Bank.
According to the German bank, market participants viewed lower prices as a buying opportunity last week and also pointed out that the world's largest gold exchange-traded fund, SPDR Gold Shares, had inflows of 6.3 metric tons over the past two trading days.
Bullish outlook for Gold on possibility of Eurozone breakup
By Kunal Shah - CommodityOnline.com
Gold futures have rebounded from $1525 to $1590 during last week and after the turbulent ride, the question in everyone's mind is that 'what would be the outlook of gold, by the end of 2012?'
The biggest problem for predicting gold prices is the number of factors which affect the prices at a given point of time. Since last 8 months, gold has been moving like a riskier asset class and not the safe haven asset class. At the time of serious risk aversion in last quarter of 2011, gold futures corrected sharply and after European central bank launched their first long term refinancing operation (LTRO) along with rally in all risky assets gold futures rallied too. Post April, 2012 where the LTRO euphoria fizzled and Euro zone debt woes again resurfaced gold along with all riskier asset class sharply corrected. Improvement in U.S. economy and strength in U.S. dollar remains one of the prime reasons for gold to remain under pressure.
QE3 "Not Off the Table"
as Euro Crisis Gives Gold Significant Upside
By: Adrian Ash - MarketOracle.co.uk
WHOLESALE MARKET spot gold prices hit a 7-session high just below $1600 per ounce in London trade early Monday, before dropping back through last week's finish at $1593 as European stock markets rose for the first time in two weeks.
Spanish and Portuguese bond prices both fell, as did "safe haven" German and US debt.
The Euro currency slipped below $1.2750 despite the G8 summit of developed-world leaders stating their commitment to Greek membership of the single currency zone and vowing to "take all necessary steps to strengthen and reinvigorate our economies and combat financial stresses."
Silver likely to reach new highs in 2012
NEW YORK (Commodity Online): Silver likely to reach new highs in this year as global mining production strains amid increased demand, said Stephen M Smith, the managing member at Smith McKenna.
Smith continued that, "key global factors look on par to stimulate silver price to higher levels as unemployment is on the decline, manufacturing demand is up, and economic growth is in order with GDP up 2.2%."
Recovery or Collapse? Bet on Collapse
By Paul Craig Roberts - PaulCraigRoberts.org
The US financial system and, probably, the financial system of Europe, like the police, no longer serves a useful social purpose.
In the US the police have proven themselves to be a greater threat to public safety than private sector criminals. I just googled "police brutality" and up came 183,000,000 results. (Here are two recent brutal assaults, one deadly, by police on hapless individuals:
Neither the Fed Nor the ECB Can Stop What's Coming
Submitted by Graham Summers - ZeroHedge.com
Today, we are witnessing the investment world's slow awakening to the fact that the monetary actions taken by the world's Central Banks have not in fact solved the issues leading up to the 2008 Crisis.
In point of fact, the Central Banks' actions have exacerbated pre-existing problems (excessive leverage) while simultaneously creating new problems (inflation).
This slow awakening has taken much longer than I would have expected, but with tens of thousands of careers on the line (financial professionals) as well as tens of trillions of dollars in portfolios at risk, the vast majority of professional market participants were highly incentivized not to realize these issues.
Obama's Five Trillion Dollar Lie
By Michael Snyder - TheEconomicCollapseBlog.com
Why isn't the U.S. economy in a depression right now? The number one reason is because the federal government has stolen more than five trillion dollars from future generations since Barack Obama was elected and has used that money to pump up our grossly inflated standard of living. Whether the federal government spends money wisely or foolishly, the truth is that the vast majority of it still ends up in the pockets of the American people who then use it to buy the things they need for their daily lives. If the U.S. government had not borrowed and spent an extra five trillion dollars that we did not have over the past several years, we would be in the middle of a rip-roaring economic depression right now. So any talk that Barack Obama is "improving the economy" is a total farce. It is a five trillion dollar lie. The reality is that Barack Obama and the U.S. Congress have been stealing trillions of dollars from future generations in order to make things tolerable in the present. If the federal government adopted a balanced budget next year, the debt-fueled prosperity that we are currently enjoying would start disappearing very rapidly and all hell would break loose in America.
Fed's Lockhart says circumstances not ripe for QE3
By John Crawley
(Reuters) - The U.S. economy needs "measured" efforts to bolster growth, but the central bank should focus on improving its communications because circumstances do not warrant further bond buying at this time, a top Federal Reserve official said on Monday.
Atlanta Federal Reserve Bank President Dennis Lockhart said the central bank's policy panel should push forward with efforts to give the public and financial markets a better understanding of how it would react to incoming information on the economy.
The True Costs of Bank Crises
by ROB URIE - CounterPunch.org
In March 2010 Andrew Haldane, Executive Director for Financial Stability at the Bank of England, estimated that the financial crisis that began in 2008 will ultimately cost the world economy between $60 trillion and $200 trillion in lost production (link). The methods he used to reach his conclusions require a number of assumptions, but so would any effort at assessing the broader damage. And to his point, counting the cost of bank crises in terms of costs to the banks alone substantially misrepresents the economic harm that recurrent crises cause.
Germany isolated as Latin Bloc calls the shots The eurozone's 'Latin Bloc' is in full revolt. The trio of French, Italian, and Spanish leaders - backed by world powers - are to push for a radical shift in Europe's economic strategy at crucial summit on Wednesday.
By Ambrose Evans-Pritchard - Telegraph.co.uk
The package of measures includes an EMU-wide guarantee of bank deposits aimed at halting a slow bank run across southern Europe, as well as demands for full activation of the European Central Bank as a lender of last resort.
They will propose eurobonds to finance an infrastructure blitz, a sort of Marshall Plan to revive confidence even if long-term benefits will take years to feed through.
Full-Fledged European Bank Run Underway;
Monetarist Fools are Everywhere; Believe in Gold
By: Mike Shedlock - MarketOracle.co.uk
One chart is all it takes to prove a full-fledged European bank run on the banks is well underway in the Club-Med countries and Ireland. [see chart]
A bank run is now happening within the eurozone. So far it has been relatively slow and prolonged, but it is a run nonetheless. And last week, it showed signs of accelerating sharply, in a way which demands an urgent response from policy-makers.
The fear of bank runs is deeply ingrained in all economists who know anything about the genesis of the Great Depression in the United States in the early 1930s. Then, the failure of the Bank of United States in December 1930 led to multiple bank runs across the country. Bank failures in the following two years wiped out personal savings and greatly exacerbated the collapse of demand in the economy.
Alexis Tsipras warns Greek crisis is also Europe's Greece's leftwing leader tells Paris audience that other EU countries will be next if they fail to oppose radical austerity drive
By Kim Willsher in Paris - Guardian.co.uk
The rising star of Europe Alexis Tsipras, the radical left Greek leader, has arrived in Paris to warn EU countries that their turn would come if they failed to oppose the radical austerity that is driving Greece to the brink of "collective suicide".
Tsipras, who is leading an austerity-backlash, said the future of Europe and the euro depended on the outcome of the Greece debt crisis. And he said he could feel a "wind of change" blowing across the continent that he hoped would lead to the "complete re-founding of Europe based on social cohesion and solidarity".
We could all be losers in this Greek poker game So now there can be no question about it.
The possibility of "eurozone exit" is real.
By Liam Halligan - Telegraph.co.uk
For years, some of us have been arguing, until we were blue in the face, that the eurozone could break up. For years, the bien pensants have told us we were wrong. Only a fool would say that now. Greek exit could happen.
To have worried aloud about the euro unravelling has been to be widely derided.
I should know. I wrote my first national newspaper column predicting some nations would end up quitting the eurozone almost 15 years ago, before monetary union even began.
Four Reasons Why The Euro Is Not Crashing
Submitted by Tyler Durden - ZeroHedge.com
Based on a swap-spread-based model, EURUSD should trade around 1.30, but based on GDP-weighted sovereign credit risk EURUSD should trade around 1.00; so who is right and what are the factors that supporting the Euro at higher levels than many would assume (given the rising probability of a Euro-zone #fail and the 0.82 lows from 2000). UBS addresses four key reasons for the apparent paradox based on the difference between ECB and Fed 'monetization', the EZ's balanced current account (independent of foreign capital flows), and the high-oil-price induced petro-dollar circulation diversifying into Euros (or out of USD). The final and most telling of factors though is bank deleveraging as European financial entities, who remain under pressure to shrink their balance sheets and re-build capital, have been selling foreign assets. They remain EUR dismalists with a year-end target of 1.15 but expect the slide to these levels to be cushioned (absent an imminent break-up) by banks' 'shrinkage'.
The Unraveling in Europe
BY JR NYQUIST - FinancialSense.com
How bad is the financial situation in Europe? Greece may be about to exit the eurozone, though not according to everyone. The Economic Times of India has published an interview with Jean Lemierre, the chief negotiator for private creditors in the Greece bailout. According to Lemierre, Greece has too much to lose and "a majority of political parties are in favor of the euro." Yet the Boston Globe is reporting that Bundesbank President Jens Weidmann has warned Europe's central banks not to increase their exposure to Greece on account of political uncertainty.
Prosecutor at NY trial:
Goldman board member gave inside tips to hedge fund friend
AP - WashingtonPost.com
NEW YORK — A federal prosecutor accused former Goldman Sachs board member Rajat Gupta on Monday of feeding inside investment tips to a corrupt hedge fund manager, while Gupta's lawyer told a jury the relationship between the Wall Street heavyweights was above board.
By sharing confidential information with his close friend, Rajat Gupta "threw away his duties, threw away his responsibilities and broke the law," Assistant U.S. Attorney Reed Brodsky told jurors in opening statements at Gupta's highly anticipated insider trading trial in federal court in Manhattan.
U.S. lets China bypass Wall Street for Treasury orders
By Emily Flitter
(Reuters) - China can now bypass Wall Street when buying U.S. government debt and go straight to the U.S. Treasury, in what is the Treasury's first-ever direct relationship with a foreign government, according to documents viewed by Reuters.
The relationship means the People's Bank of China buys U.S. debt using a different method than any other central bank in the world.
The other central banks, including the Bank of Japan, which has a large appetite for Treasuries, place orders for U.S. debt with major Wall Street banks designated by the government as primary dealers. Those dealers then bid on their behalf at Treasury auctions.
China Can Now Monetize US Debt Directly
Submitted by Tyler Durden - ZeroHedge.com
The Treasury, apparently dissatisfied with the speed of indirect bank and/or Fed-inspired monetization of its exponentially rising debt-load at ever-cheaper costs of funds, decided in June 2011 to allow the Chinese, with their equally large bucket of USDs to bid directly for US Treasuries. As Reuters reports, China can now bypass Wall Street when buying U.S. government debt and go straight to the U.S. Treasury, in what is the Treasury's first-ever direct relationship with a foreign government. The documents, viewed by Reuters, indicate that the US Treasury has given the PBOC a direct computer link to its auction system - which was first used in the 2Y auction of June 2011. Perhaps this helps explain the massive spikes in direct bidders July and August 10Y auctions (around the US downgrade).
The AIJ scandal and Japan's pension time bomb
By Chikafumi Hodo and Nathan Layne
(Reuters) - Tarumi Taxi in western Japan's port city of Kobe is teetering on the brink of bankruptcy, offering a glimpse of the crisis facing tens of thousands of small and mid-sized companies acrossJapan with little hope of meeting their pension obligations.
Owner Satoshi Nagata, 59, has been pressing banks for a loan before a deadline in September when a contractual trigger will quadruple the hole in the firm's pension account. Without it, Tarumi Taxi and its fleet of 40 cars and 80 drivers will likely fold.
Liquidation Syndrome
John P. Hussman, Ph.D. - Jussman.net
Over the past two weeks, the S&P 500 has lost months of upside progress in a handful of sessions. This is the very characteristic initial outcome of the overvalued, overbought, overbullish syndrome that has been in place until recently (the decline has cleared the overbought component). The good news here is that we now estimate the 10-year prospective total return on the S&P 500 to be about 5.2% annually as a result of the recent decline. As a rule of thumb, a 1% market decline in a short period of time tends to increase the prospective 10-year return, not surprisingly, by about 0.1%. However, that approximation is less accurate over large movements or over extended periods of time, where growth in fundamentals and compounding effects become important.
Obama faces pressure on Volcker Rule
WashingtonPost.com
Nearly two years after the signing of a major law to boost oversight of Wall Street, two Democratic senators are calling on President Obama to speak out even more strongly in favor of a new federal rule that they say should have banned the trading that led to JPMorgan Chase's $2 billion or more loss.
But Obama is in a difficult spot. Although he introduced and supports the Volcker Rule, which bans banks from gambling with their own money, regulators have yet to finish writing the rule and haven't determined whether the trading would have violated the draft version of the rule that has been released.
One Lesson From J.P. Morgan: Wall Street Has Changed
By Rick Newman - USNews.com
Nothing is new on Wall Street, the conventional wisdom goes. The recent flap involving a huge trading loss at J.P. Morgan Chase shows that all the bad habits remain intact. The casino never closed, so step right up and place your bets.
It's a convenient storyline, with the greedy bankers playing their predictable, nefarious role. But the full story of that trading loss, which is still emerging, actually shows a very different pattern from the disasters that dominated Wall Street in 2008 and 2009. There's even encouraging news in the way public and investor pressure has made banks more accountable for their own mistakes.
JPMorgan suspends stock repurchase program
to preserve capital after $2 billion trading loss
By PALLAVI GOGOI, AP Business Writer - ChicagoTribune.com
NEW YORK (AP) — JPMorgan Chase is suspending plans to buy back its own stock, a little over a week after the bank posted a large trading loss.
The largest U.S. bank by assets disclosed the $2 billion trading loss on May 10 in a hastily-called conference call with investors and journalists.
The loss from an ill-timed trade on so-called credit derivatives has rattled investor confidence in JPMorgan Chase, leading to a 20 percent decline in the value of the stock since the disclosure, lopping off $30 billion of market value.
JPMorgan CIO Risk Chief Said To Have Trading-Loss History
By Lisa Abramowicz and Dawn Kopecki - Bloomberg.com
Irvin Goldman, who oversaw risks in the JPMorgan Chase & Co. (JPM) unit that suffered more than $2 billion in trading losses, was fired by another Wall Street firm in 2007 for money-losing bets that prompted a regulatory sanction at the firm, Cantor Fitzgerald LP, three people with direct knowledge of the matter said.
JPMorgan appointed Goldman in February as the top risk official in its chief investment office while the unit was managing trades that later spiraled into what Chief Executive Officer Jamie Dimon called "egregious," self-inflicted mistakes. The bank knew when it picked Goldman that his earlier work at Cantor led regulators to penalize that company, according to a person briefed on the situation.
Has Goldman Sachs's Succession Plan Changed
After Greg Smith Scrutiny? Blood in the Water The op-ed heard round the world—Greg Smith's scathing New York Times attack on Goldman Sachs, his employer of nearly 12 years—dealt another blow to the firm's reeling reputation. Now the questions are louder than ever: Will C.E.O. Lloyd Blankfein have to go? Who might succeed him? And does it matter?
By Bethany McLean - VanityFair.com
It was the op-ed heard round the world. "When the history books are written about Goldman Sachs, they may reflect that the current chief executive officer, Lloyd C. Blankfein, and the president, Gary D. Cohn, lost hold of the firm's culture on their watch. I truly believe that this decline in the firm's moral fiber represents the single most serious threat to its long-run survival," wrote Goldman Sachs vice president Greg Smith in a March 14, 2012, piece published on the op-ed page of The New York Times on the day he was quitting the firm. He went on to accuse his employer of doing exactly the opposite of its No. 1 business principle, which famously trumpets that clients' interests come first.
Gaming the Housing Market The Waltz of the Zombie Banks
by MIKE WHITNEY - CounterPunch.org
It's the same everywhere. The banks are keeping houses off the market to trick people into believing that prices have hit bottom. But prices haven't hit bottom, in fact, they still have a long way to go. So, what's going on here; what do the banks hope to gain by withholding supply? Here's a clip from an article in OCHousing News that helps to explain:
"Lenders hope they can solve all their problems by making the housing market hit bottom. If prices bottom, people who bought at the bottom gain equity with rising prices, and they in turn reignite the move-up market which will allow the banks to sell their high-end shadow inventory. Further, rising prices makes for fewer short sales and fewer foreclosures and distressed sellers become equity sales. Rising prices would be a panacea for lenders, which is why the full weight of our government and the federal reserve is working to make house prices go back up. …. they hope they can create an artificial bottom and momentum to carry them through the liquidation of their distressed inventory." ("11.8% of all loans at least 30 days past due or in foreclosure", OCHousing News)
Housing starts:
The problem with the government's numbers
by David S. Hilzenrath - WashingtonPost.com
Take, for instance, the big news last week. According to a government report, housing starts rose 2.6 percent in April. Or maybe they fell 12.2 percent. Or maybe they rose by a much more dramatic 17.4 percent. It's hard to say, because the reported number came with a margin of error of plus or minus 14.8 percent.
That means it was unclear whether housing starts actually rose or fell, according an explanatory note in the fine print of the government's May 16 announcement, a joint release of the U.S. Census Bureau and the Department of Housing and Urban Development.
Go Midwest, Young Man:
Indiana's Plan to Steal California Jobs Governor Mitch Daniels has a bold strategy to make his state the new destination for outbound sunbelt businesses. But making Indiana a tech magnet will take more than low taxes.
By Jason Margolis - TheAtlantic.com
Some Californians may have recently noticed an advertisement with a coffee mug and the word "Indiana" written in the milky latte foam. A crumpled napkin sits next to the mug with this scribbled on it: "Admit it, you find me fiscally attractive." On another napkin it reads, "Indiana: low taxes, pro-business, fiscally responsible."
Ads like this are part of the Hoosier state's new push to lure California companies 2,300 miles east, trying to convince them to give up the morass of California regulations and high business taxes, in exchange for the regulation-light, low tax business nirvana of Indiana.
Campbell's soups to be mmm, mmm, more expensive
By Tiffany Hsu - ChicagoTribune.com
Campbell Soup Co. will raise prices on its condensed soups by 5% in June as the company tries to turn itself around amid sliding profits.
Blame high production costs and continued inflation for the price increase, according to Campbell Senior Vice President B. Craig Owens in a conference call with analysts. The company previously raised its soup prices 5% in June 2011.
Putting the 'Insurance' Back in Health Insurance
By Avik Roy, Contributor - Forbes.com
We understand that it would make no sense to buy auto insurance after we've already crashed our car. We appreciate that it would be strange to buy homeowner's insurance after our house has already burned down. And yet, when it comes to health coverage, many of us think that it makes perfect sense to wait until we're sick to buy health insurance. If we really want to make health insurance affordable and accessible to everyone, we need to go back to basics, and understand all of the government-induced distortions that have made health insurance look nothing like actual insurance.
THE CHURCH AGAINST OBAMACARE: THE LAWSUITS
By Scott Johnson - PowerLineBlog.com
In a story we've been following for several months now, Terry Jeffrey reports today's development:
The Archdiocese of New York, headed by Cardinal Timothy Dolan, the Archdiocese of Washington, D.C., headed by Cardinal Donald Wuerl, the University of Notre Dame, and 40 other Catholic dioceses and organizations around the country announced on Monday that they are suing the Obama administration for violating their freedom of religion, which is guaranteed by the First Amendment to the Constitution.
The dioceses and organizations, in different combinations, are filing 12 different lawsuits filed in federal courts around the country.
Son Hit With Aging Parent's $93K Nursing Home Bill
By Carolyn Rosenblatt, Contributor - Forbes.com
Could this happen to you?
John Pittas' mother entered a nursing home for rehabilitation following a car crash. After she left the nursing home, she moved out of the country. His mother's $93,000 bill at the home was left unpaid. The mom had applied for Medicaid, which would normally pay the bill if she couldn't.
The mom's Medicaid application did not get approved in enough time to satisfy the nursing home, and it sued her son for the bill. The state of Pennsylvania, like 29 others in our country, has something called a "filial responsibility law". Those laws require that spouses, children and even parents of needy adults support the indigent. These laws were rarely ever enforced. The nursing home decided to enforce it rather than have Medicaid do what it was designed to do.
States back Montana in Citizens United campaign finance fight Twenty-two US states ask supreme court to revisit controversial ruling that lifts restrictions on corporate money in politics
By Chris McGreal in Washington - Guardian.co.uk
Nearly half of US states have thrown their weight behind a legal defence of local laws restricting corporate money in politics by asking the supreme court to revisit its widely-criticised ban on similar national legislation.
The states filed a brief with the supreme court on Monday in support of a century-old law in Montana – the Corrupt Practices Act – against companies pumping money into elections.
What's Mine is Mine What's Yours is Negotiable
By Robert Owens - PatriotPost.us
The economy is scheduled to plunge off a cliff in January.
Back in the first two years after the Progressive's November Revolution of 2008, the big government party enacted tax increases not scheduled to take place until after the 2012 elections. They also passed Obamacare which carries within it multiple tax increases, which are also scheduled to take affect after the 2012 election. Combine these with previous tax rollbacks scheduled to expire in January 2013 and we are looking at the major economic crisis the progressives have worked so hard to create so they can then work so hard to solve.
New Bill Would Make It Legal To Target Propaganda
And "Psychological Operations" Directly At U.S. Citizens
By Michael Snyder - EndOfTheAmericanDream.com
Should it be legal for the U.S. government to spend billions of dollars on propaganda designed to change public opinion in the United States? Should it be legal for the U.S. government to use television, radio, newspapers, Facebook, Twitter, YouTube, blogs and Internet forums to conduct "psychological operations" targeted at the American public? An amendment that has been added to a new defense bill in Congress would make it legal to target propaganda and "psychological operations" directly at U.S. citizens. The latest version of the National Defense Authorization Act would overturn the Smith-Mundt Act of 1948 and the Foreign Relations Authorization Act of 1987. Those two laws essentially make it illegal for propaganda that is used to influence public opinion overseas to be targeted at U.S. citizens back here at home. If those two laws are struck down, there will be essentially very few limits to what the U.S. government can do to shape our opinions. The government would be able to bombard us with propaganda messages on television, on the radio, in our newspapers and on the Internet and there would not even be a requirement that those messages be true. In fact, just as happens so often overseas, it would likely be inevitable that the government would purposely disseminate misinformation to the American public for the sake of "national security". That is why it is imperative that this bill not become law.
Move to change propaganda laws
opens up Cold War argument
by Anne Sorock - LegalInsurrection.com
An old Cold War argument has been resurrected with the news that an amendment allowing U.S. propaganda to be broadcast within our borders has been passed out of the house along with the Defense Authorization Act.
Should the State Department be authorized to allow its propaganda to be broadcast to us in the U.S.?
Or, should we maintain the separation barring U.S. propaganda produced for foreign audiences from being broadcast in the U.S.?
Representatives Mac Thornberry (R-TX) and Adam Smith (D-WA) in their "The Smith-Mundt Modernization Act of 2012" (H.R. 5736), suggest the former–that it is time to free up the authority to broadcast U.S.-produced foreign propaganda in the U.S.
denial or confirmation... ? Facebook denies it aims to lift ban
on under-13s joining social network site
By TOM GOODENOUGH - DailyMail.co.uk
Facebook denied that it was to relax a ban on under-13s joining the social network in a bid to boost numbers.
In an interview this weekend, a senior employee of the company admitted that a large number of under 13-year-olds join up anyway - and it was reported that the site aimed to lift the ban.
A Facebook spokesperson said today, 'All we have said is what we have been saying for months - that minors on Facebook and the internet is an important issue and we want to work with the broader industry to look at ways of keeping minors safe.'
7 Reasons Why Facebook IPO Was A Bust
By Rich Karlgaard - Forbes.com
1. Too late. Facebook's shares have been dead in the water for the last 12 months. Private investors had already bid up Facebook to a $100 billion value a year ago.
2. Mark Zuckerberg's disdain for investors. He never wanted to be a public company. This became all too obvious during the IPO road show's crucial stop in New York when (a) Zuck hid out in the bathroom and forced the audience to wait, and (b) he took the stage wearing his hoodie. Zuckerberg's view of shareholders is like President Obama's view of blue collar workers. He needs them but secretly laughs at them.
3. Facebook left nothing for the common investor. The insider pig pile of PE firms and celebrity Silicon Valley angels took it all. This is a rather new, post-Sarbanes-Oxley fact and it should make Americans very, very angry. When Microsoft when public in 1986, its market value was $780 million. Microsoft's market value would rise more than 700 times in the next 13 years. Bill Gatesmade millionaires of thousands of ordinary public investors. When Google went public in 2004 at a $23 billion valuation, it left less on the table for you and me. Still, if you had invested in Google then and held your stock, you would be sitting atop a 9x return. Zuckerberg and his Facebook friends took it all.
Facebook shares fall sharply
on second day of trading on Nasdaq
Guardian.co.uk
Shares down to $34.03 from initial price of $38 amid criticism of Facebook's share value and Morgan Stanley's handling of sale
By Matt Williams and Brian Braiker in New York - Guardian.co.uk
Facebook shares have fallen sharply on a second day of trading, leading to questions about the valuation of its IPO and the handling of the sale by its bankers.
At the close of business on Monday, shares in the social networking site were off more than 10%, down to $34.03 from the initial price of $38. The market value of the firm took a $10bn hit as a result of the slide.
Should Google's Search Results
Be Protected by the First Amendment? Algorithmically generated editorial judgment is still judgment.
By Rebecca J. Rosen - TheAtlantic.com
Is Google using its power as the number-one search engine to promote its own products such as Google Places and Google Maps? That was the question at hand last fall when Google executive chairman Eric Schmidt testified in Congress. "I see you magically coming up third every time," Senator Mike Lee of Utah said. "I don't know whether you call this a separate algorithm or whether you've reverse engineered one algorithm, but either way you've cooked it, so that you're always third."
Schmidt responded, "Senator, may I simply say that I can assure you we've not cooked anything."
NATO Blog:
Hundreds march into the Loop on final summit day
ChicagoTribune.com
A few hundred protesters rallied at Boeing headquarters today, labeling it a "war machine" as they made paper planes and wrote anti-war messages on them. Around nooon, they started marching into the Loop. It was the main demonstration scheduled for today as world leaders continued to meet. Once again, Chicago police and their out-of-town colleagues posted up on Chicago River bridges to prevent any attempts by protesters to get to River North or the Magnificent Mile... plus other updates.
The Age of Competing Nationalities
by PATRICK COCKBURN - CounterPunch.org
The crises in Europe and the Middle East are very different but they are beginning to cross-infect each other, creating a general mood of uncertainty and fear. In the Middle East, the Arab Spring was at first seen as wholly positive, as dictatorships and police states tumbled or came under democratic assault from Tunis to Bahrain. A bright dawn was breaking across the region.
A year later, Syria, Egypt, Yemen, Bahrain and Libya are still beset by power struggles, largely electoral in Egypt but increasingly militarized in Syria. Their outcome is unclear. What is evident is that these countries are in for an extended period when governments and states will be weak, disunited and vulnerable to outside interference.
Why a Chinese Company Wants to Own
Your Local Movie Theater By purchasing America's second largest cinema chain, Dalian Wanda Group is hoping to launch a global entertainment takeover
By Jordan Weissmann - TheAtlantic.com
Assuming the deal gets a pass from government regulators, there's good chance that your local movie theater will soon be owned by a large, Chinese conglomerate. This weekend, Dalian Wanda Group announced that it would pay $2.6 billion to purchase AMC Entertainment, America's second largest cinema chain. It would be the most expensive foreign takeover yet by a private Chinese company, a summer blockbuster for the M&A world.
AMC Buyout Part of Chinese Takeover of Media Beijing aiming to project its "soft power"
Paul Joseph Watson - Infowars.com
Chinese company Wanda has announced it will buy AMC, the second-largest theater chain in the USA, increasing fears that the Chinese Communist Party is expanding its influence globally as part of a media takeover.
"Beijing is investing heavily in projecting its "soft power," or cultural influence, by boosting Chinese state media's presence abroad, including the USA, where the Chinese government has also run advertisements in New York's Times Square," reports USA Today.
China Furious about US
Antidumping Tariffs of 31% against Imported Solar Panels
By James Burgess - OilPrice.com
The US has angered China once again, this time by announcing that antidumping tariffs of more than 31 percent will be levied on solar panels imported from China. The move has infuriated Chinese officials who were already upset due to allegations against China's human rights policies and confrontational attitude towards American allies such as Japan and the Philippines.
The tariffs will be some of the biggest in American history, regarding one of the largest and fastest growing industries in China, the world's largest exporter.
China to Invest in Coal Gasification - with GE's help
By John Daly - OilPrice.com
First, the bad news for China's economic miracle.
According to a quarterly report issued last month by China's China Electricity Council (CEC), some parts of China will experience severe blackouts this summer as the result of an electricity shortage of 30-40 million kilowatt hours. The CEC warned, "The shortage will hit about 30 million kilowatt hours during summer peak days and may expand to 40 million kilowatt hours if heat waves persist," with China's more developed eastern and southern regions bearing the brunt of the shortages.
The Real Issue is Pakistan
By Rich Galen - PatriotPost.com
President Barack Obama was in Chicago hosting the NATO conference over the weekend trying to negotiate, literally, a pathway through the twin Stan thickets - Paki and Afghani.
Afghanistan is officially a NATO project even though it is possible to buy a faux shoulder patch for the ISAF (which is supposed to stand for International Security Assistance Force) with the subhead: "I Saw Americans Fighting."
At least they were still available in a German PX the last time I was there.
US-Pakistan tensions deepen
as Obama snubs Zardari at Nato summit Obama expresses frustration with Pakistan over its refusal to open up Nato supply routes in protest over US drone attacks
By Ewen MacAskill in Chicago - Guardian.co.uk
The rift between the US and Pakistan deepened on Monday as the Natosummit in Chicago broke up without a deal on Afghanistan supply routes.
Barack Obama, at a press conference to wind up the summit, made no attempt to conceal his exasperation, issuing a pointed warning to Pakistan it was in its wider interest to work with the US to avoid being "consumed" by extremists.
West mulling military action against Iran
NYDailyNews.com
Moscow, May 21 — Some Western countries are still considering a military operation against Iran as an option over its nuclear programme, a Russian minister said Sunday.
"Russia is concerned that the possibility to try to solve the Iranian nuclear problem by military means is still viewed as real," Xinhua quoted Russian Deputy Foreign Minister Sergei Ryabkov as saying.
"We still hear messages from public and intelligence channels, which show that certain capitals regard this option as much more applicable to the situation (around Iran) than it was before," he said upon his return from the G8 summit in the US.
Regulators close small bank in Alabama,
makes 24 US bank failures so far in 2012
By AP - WashingtonPost.com
WASHINGTON — Federal regulators have seized a small bank in Alabama, bringing to 24 the number of U.S. banks that have failed so far this year.
The bank had about $51.6 million in assets and $45.1 million in deposits as of March 31.
Southern States Bank, based in Anniston, Ala., agreed to take over the deposits and essentially all the assets of the failed bank, which had one branch.
Gold may have regained some safe haven status: HSBC
LONDON (Commodity Online): Gold may have regained some of its safe-haven allure on Friday's sharp rally, which occurred as the dollar strengthened and risk assets weakened, said HSBC, British multinational bank, in a commodity research note.
The Dow Jones Industrial Average fell for the 11th time in 12 sessions. European debt issues remained in the spotlight.
The British bank stated that, "The ability of gold to move higher despite declines in risk assets may be a turning point for gold as it may have regained some of its status as a safe haven, we believe."
Will precious metal premiums one day trump the spot price?
By Dr Jeffrey Lewis - CommodityOnline.com
One of the curious characteristics of the retail precious metals market is the premium that retail investors need to pay in order to purchase silver or gold bullion coins for investment purposes. This premium consists of the extra price that an investor needs to pay over and above the intrinsic value of the metal contained within the coin evaluated at prevailing spot market prices.
By Abandoning the Gold Standard
We Accepted Central Planning and Chaos
BY DETLEV S SCHLICHTER - FinancialSense.com
With this essay I will try to reconcile two apparently conflicting perceptions of the key problems with our present monetary system. I will start by characterizing these two positions first:
As readers of my website and book know, it is my conviction that the central problem with the present system is the high degree of elasticity of the money supply. A system of constant fiat money expansion, of ongoing injections of new money into the economy via financial markets – sometimes slow, sometimes fast – must systematically distort interest rates and disarrange saving and investment. This will lead to capital misallocations and the mispricing of assets. As these distortions are systematic, the resulting dislocations are bound to accumulate over time and thus progressively destabilize the economy. Elastic money is suboptimal, unstable and unsustainable.
Gartman adding to Gold position, but only in euro terms
LONDON (Commodity Online): Investor and newsletter writer Dennis Gartman said that he is adding to his small gold position but buying only in euro terms.
Gold has been boosted by the combination of Federal Open Market Committee minutes Wednesday saying several members would consider more easing if the economy remains weak, coupled with a disappointing Philadelphia Fed index on Thursday, said Gartman in his latest news letter.
The 100% Economy:
Why the U.S. Needs a Strong Middle Class to Thrive Nick Hanauer is the kind of innovator and venture capitalist expected to power the country's next wave of growth. So why does he insist that only the fading middle class can rescue America?
By Jim Tankersley - TheAtlantic.com
SEATTLE--Nick Hanauer toddled through his early years in a cramped Greenwich Village apartment. His mother waited tables at the Bitter End. His father worked low-level jobs on Wall Street and as an editor at a publishing house. When Nick was 5, his folks left New York to join a family pillow-making business in the Pacific Northwest. They raised their three sons in a three-bedroom house in the suburbs and sent them to public schools. After Nick, the eldest, earned a philosophy degree at the University of Washington, he went to work for his father. In his 30s, he scraped together $45,000 to invest in a small start-up that sought to revolutionize American retail. It was called Amazon.com.
We Move Along Toward the Bang Point - Lacy Hunt
Casey Research's Chief Technology Investment Strategist, Alex Daley sits down with Lacy Hunt, Executive Vice President of Hoisington Investment Management, at the latest Casey Research Conference, "Recovery Reality Check" in Weston, Florida.
Panic Like It's March 2009
BY CHRIS PUPLAVA - FinancialSense.com
As everyone is well aware, Europe is an absolute mess and while the U.S. stock market has been remarkably resilient, it has finally succumbed to news across the Atlantic and is now the final region to experience a decline. The U.S. economy has been fairly strong this year with a continued improvement in the labor market at the same time inflation has been kept at bay. While Fed Chairman Bernanke would like to launch another round of quantitative easing (QE3), he has not had the latitude to do so as weakness in Europe and a declining stock market have not provided the Fed with enough of cover to hit the print button.
Rising US recession risk poses the real threat to Europe The US economy has slowed to stall speed. A few lonely forecasters fear that America has already fallen back into recession, replicating the terrible double-dip of 1937.
By Ambrose Evans-Pritchard - Telegraph.co.uk
The Philly Fed's manufacturing index dropped suddenly to minus 5.8 in May. The US Conference Board's index of leading indicators fell in April. Job creation has slipped from 250,000 a month to nearer 130,000 in March and April.
The Economic Cycle Research Institute (ECRI) says post-War personal income growth in the US has never been this weak for three months in a row without triggering a recession. It has happened ten out of ten times.
At Camp David, world leaders agree
on more spending to boost Europe's economy
By David Nakamura and Howard Schneider - WashingtonPost.com
CAMP DAVID, Md. — Leaders of the world's wealthiest nations opened the door Saturday to more government spending in Europe as way to revive the continent's struggling economy, shifting away from the idea that the surest way to recovery was through strict fiscal austerity.
Meeting at the Group of Eight summit at Camp David, President Obama and his fellow leaders said they were committed foremost to creating jobs and growth, a shift, at least in emphasis, from previous gatherings dominated by German efforts to reduce high government debt through drastic fiscal reform.
Obama to press NATO for Afghan funds
by Hayley Peterson - WashingtonExaminer.com
President Obama is huddling with the leaders of more than 60 countries in his hometown of Chicago this week to work out a timetable for the withdrawal of troops from Afghanistan and to figure out who is going to pay $4 billion a year to help the Afghans protect themselves beyond 2014.
After a decade of war, Obama and the 28 member nations of NATO will redefine the combat mission in Afghanistan and plot the withdrawal of the 130,000 foreign troops remaining in the country.
G8 Summit: World leaders push for Greece to stay in the eurozone World leaders have thrown their weight behind Greece staying in the eurozone after a day of crisis talks at the G8 summit in Camp David.
By Angela Monaghan - Telegraph.co.uk
"We agree on the importance of a strong and cohesive eurozone for global stability and recovery, and we affirm our interest in Greece remaining in the eurozone while respecting its commitments," leaders said in a statement released by the White House on Saturday night.
"We all have an interest in the success of specific measures to strengthen the resilience of the eurozone and growth in Europe."
Jim Cramer Is Predicting Bank Runs In Spain And Italy
And Financial Anarchy Throughout Europe
By Michael Snyder - TheEconomicCollapseblog.com
During an appearance on Meet The Press on Sunday, Jim Cramer of CNBC boldly predicted that "financial anarchy" is coming to Europe and that there will be "bank runs" in Spain and Italy in the next few weeks. This is very strong language for the most famous personality on the most watched financial news channel in the United States to be using. In fact, if Cramer is not careful, people will start accusing him of sounding just like The Economic Collapse Blog. It may not happen in "the next few weeks", but the truth is that the European banking system is in a massive amount of trouble and if Greece does leave the euro it is going to cause a tremendous loss of confidence in banks in countries such as Spain, Italy and Portugal. There are already rumors that the "smart money" is pulling out of Spanish and Italian banks. So could we see some of these banks collapse? Would they get bailed out if they do collapse? It is so hard to predict exactly how "financial anarchy" will play out, but it is becoming increasingly clear that the European financial system is heading for a massive amount of pain.
"Attempts to form a government in Greece collapsed on Tuesday, jolting financial markets at the prospect leftists opposed to the terms of an EU bailout could sweep to victory in a June election and nudge the euro zone crisis into a dangerous new phase." –CNBC
Why should the Greek people be financially destroyed and rendered destitute by forced German and Brussels EU austerity measures and more loans designed only to pay the interest on the debt to the big banks? What if the banking and media establishment are dead wrong about nations withdrawing from the Euro like they have from the beginning of the crisis? I suggest a strong economic recovery is the likely result rather than depression as forecast by experts working for the banks that have enslaved Greece.
What Would You Do?
The most pro-European thing to do now is reject the euro Those readers who have been berating me for years for even considering the possibility of a country leaving the euro have recently fallen silent. (You know who you are.)
By Roger Bootle - Telegraph.co.uk
This week I want to move on from trying to forecast what even the most purblind of euro-fanatics now recognise as, to put it mildly, a very distinct possibility, to considering the consequences.
You may think this is premature. Personally, I have always thought that if you are going to be a forecaster you should specialise in being early.
Euro austerity example Ireland 'may need second bailout'
Ireland, seen as the eurozone's "poster child" for implementing austerity, could require a second bailout, economists warned.
By Emma Rowley - Telegraph.co.uk
As households struggle to pay their mortgages, the country's rescued banks may need €4bn (£3.2bn) more to cover losses on loans than was assumed in stress tests last year, said analysts at Deutsche Bank.
That would hit the finances of the Irish government, which has already pumped about €63bn into its banking sector in the last three years.
Wealthy eurozone countries must back weak nations,
George Osborne warns The wealthiest eurozone nations must support the weaker, indebted nations such as Greece and Portugal or face the prospect of the currency union breaking up, George Osborne has warned.
Telegraph.co.uk staff
"Eurozone countries must either stand behind their currency or face up to the prospect of Greek exit with all the risks that could involve," the Chancellor wrote in The Sunday Times today (£).
Mr Osborne, who watched the Champions League final with his German counterpart Wolfgang Schaeuble last night, warned of "enormous risks" to the UK economy if the crisis is not tackled.
Endgame in Greece
By Clive Crook - TheAtlantic.com
European Union leaders are saying they want the new election in Greece scheduled for June 17th to be a referendum on whether the country will (a) remain part of the euro area, and (b) meet their conditions for EU support in that effort. All concerned will be lucky if the issue has not been resolved before then--by a disorderly Greek exit from the currency system, and what follows. This weekend may be the last chance to intervene to stop that disastrous outcome.
Greece and the Eurozone:
What to Expect When You're Expecting the Unknowable
By Jared Bernstein - HuffingtonPost.com
More out there today on the possibility of Greece leaving the Eurozone. The New York Times is a bit less pessimistic than the Washington Post, but if you're looking for something new to get nervous about, here you go. Better yet, I'll summarize: we don't know the outcome, but it will be ugly. Of course, it's already ugly, and that's worth remembering.
In terms of global reverberations, investors from other countries have been pulling out of Greece for a while. Claims by foreign banks in Greece are now down to below $100 billion, compared to $600-700 billion in Spain and Italy.
Keiser Report: Guernica of Financial War (E290)
In this episode, Max Keiser and co-host, Stacy Herbert, discuss the Guernica of the financial war and the 'eternity' of 100 microseconds. In the second half of the show Max talks to artist, Alex Schaefer, about burning Chase, dangerous derivatives and paper dollars.
JPMorgan Chase and Central Banking
Mises Daily: by Frank Shostak
On Friday, May 1, 2012, JPMorgan Chase said it suffered a $2 billion trading loss. Some commentators have suggested that the huge loss emanates from so-called proprietary trading or placing risky bets using the bank's money. The loss raised the credibility of the Volcker rule, which restricts banks from trading their own money. Despite JPMorgan Chase's large loss, the opponents of the Volcker rule are of the view that the rule, if it is introduced, will only destabilize the financial markets and make things much worse. Hence they would like to allow market forces to do their job.
Do Fewer Banking Controls Always Equate with a Free Market?
The proponents for less control in the banking industry hold that fewer restrictions imply a better use of scarce resources, which leads to the generation of more real wealth.
We Told You So
By James K. Galbraith, The Baffler - Truthdig.com
....To economists in my own circle, it had long been clear that the financial crisis then unfolding was an epic event. We had watched the subprime mortgage disaster build up. In August 2007 we knew the meltdown had begun. Bear Stearns had failed. But for reasons that have to do with the pace and rhythm of politics, these issues remained on the back burner, the campaign being dominated by health care and the Iraq war. For those of us on the outside, it was hard to know whether the insiders understood what was coming.
And so it seemed a good idea to raise an alarm. But here you confront the Cassandra paradox: if you predict disaster, no one believes you. Economics is rife with alarmists; if the wolf really is at the door, it's better to have a whole chorus saying so.
Sen. Tom Coburn, part one: Defusing the debt bomb [interview]
Posted by Ezra Klein - WashingtonPost.com Ezra Klein: So 'taxmageddon' is coming at the end of the year. Depending on how you look at it, it's an opportunity for Congress to trigger a massive and unnecessary fiscal crisis, or to actually get some serious legislating done on our long-term fiscal issues. Are you optimistic about the outcome? Tom Coburn: No. But it depends on what the mix is. If President Obama is still president and we're in control of the Senate, I think you'll see significant attempts to get something done. But I don't think they'll be much more successful than what we saw in August. And I wouldn't consider that very successful. If Romney wins and we win control in the Senate, we have to send a signal that we're going to fix it in order to take away all that potential risk to the economy. You have to say we'll work all over the Christmas holidays to get it fixed.
Obama pursues higher tax rates, growth be damned
by Michael Barone - WashingtonExaminer.com
In the run-up to this weekend's G-8 summit at Camp David, journalists have unfavorably compared European "austerity" with Barack Obama's economic policies.
European spending cuts, the argument goes, have hurt people and are arousing political opposition, while Obama's proposals to indefinitely keep federal spending at 24 percent of gross domestic product are likely to succeed.
Evil Republican spending cuts, in contrast, would deny the economy needed stimulus and would wreak havoc on ordinary people.
Vermont bans fracking
By Dave Gram - AP - Dispatch.com
MONTPELIER, Vt. — Gov. Peter Shumlin yesterday signed into law the nation's first ban on a hotly debated natural gas drilling technique that involves blasting chemical-laced water deep into the ground.
The Democrat, surrounded at a Statehouse ceremony by environmentalists and Twinfield Union School students who pushed for the ban, said the law may help Vermont set an example for other states. The ban may be largely symbolic, though, because there is believed to be little to no natural gas or oil beneath the surface in Vermont.
New Normal: Majority Of Unemployed Attended College
By JED GRAHAM, INVESTOR'S BUSINESS DAILY
For the first time in history, the number of jobless workers age 25 and up who have attended some college now exceeds the ranks of those who settled for a high school diploma or less.
Out of 9 million unemployed in April, 4.7 million had gone to college or graduated and 4.3 million had not, seasonally adjusted Labor Department data show.
8 Thoughts About Facebook's Post-IPO Future The big news of the day (the week? the month?) is that everyday investors can now buy shares of Facebook. Quiet. Please sit down, everyone. Ladies and gentlemen, quiet please. Please! I am holding the conch shell. I am holding the conch shell
By Alexis Madrigal - TheAtlantic.com
Everyone wants to have their say about Facebook today, even if there isn't too much more to say than there was yesterday. We know this is a company with an astounding number of very engaged users. We know that some people love it and other people find it annoying. We know their ads have a lower than average clickthrough rate, but that it seems like they have the potential to build the world's most formidable advertising business. We know they make some money but not nearly as much as companies that have much smaller market values.
Expatriation in the Wake of the Facebook IPO
By Bill Bonner - dailyreckoning.com
05/19/12 Baltimore, Maryland – The Maryland House of Delegates just voted to raise taxes. Should we move to Florida…or Delaware?
If we move to Palm Beach, will we ever be able to visit our beloved Maryland homeland again?
The Financial Times reports that thousands of wealthy French people are now moving to London. Their motive? They want to escape the taxes proposed by France's new president, Francois Hollande.
Should the French impose an exit tax on these "ex-patriots"? Should it then bar them from visiting France?
Of course not.
"Anyone who tells you that America is in decline or that our influence has waned," said President Obama in his 2012 State of the Union address, "doesn't know what they're talking about."
It was a "rah-rah America!" applause line for a president who needed to get the assembled Republicans out of their seats a few times over the course of the evening. But the line works literally, too. Whenever someone tells me that the United States is in decline, I have no idea what they're talking about. And neither, I tend to think, do they.
The claim is maddeningly vague. What does it mean for the United States to be in decline? Are we talking about our geopolitical influence relative to other world powers? Our standard of living relative to other nations? Our current standard of living compared with some assumption about its appropriate rate of improvement?
Obama impeachment bill gaining steam
By Jeffrey Phelps - Examiner.com
Hoping to soon pass committee and make it to the house isHCR 107, a bill threatening the possibility of the impeachment of the President of the United States for high crimes and misdemeanors, now thrust into the spotlight.
Citing a demand Wednesday that Obama regain respect for the War Powers Act, constitutional laws that restrict a President from waging a war without first receiving the approval of the people and its Congress, was the architect of the legislation, 9-term North Carolina Congressman, Walter Jones.
Obama Impeachment Bill Goes Viral!
Alex speaks with Congressman Walter B. Jones, Jr. about H.CON.RES.107 -- a bill that deems the use of offensive military force by a President without prior and clear authorization of an Act of Congress an impeachable high crime and misdemeanor under article II, section 4 of the Constitution.
Bill Text
112th Congress (2011-2012) H.CON.RES.107.IH
Expressing the sense of Congress that the use of offensive military force by a President without prior and clear authorization of an Act of Congress constitutes an impeachable high crime and misdemeanor under article II, section 4 of the Constitution.
Rev. Wright urged to stay silent until after 2012
by Byron York - WashingtonExaminer.com
Rev. Jeremiah Wright, whose "God damn America" sermon set off a firestorm during the 2008 campaign, agreed not to publish an account of the episode until after President Obama's 2012 re-election campaign, according to an interview Wright conducted with the author of a new book on Obama. Wright said he made the decision at the urging of a friend and mentor, the prominent University of Chicago emeritus professor Martin Marty.
In the interview, Wright told Ed Klein, author of The Amateur: Barack Obama in the White House, that he keeps a cardboard box of documents and notes detailing his experiences beginning in March 2008, when the controversy over his sermons began. "It's a painful box to look at," Wright said.
A Victory for All of Us
By Chris Hedges - Truthdig.com
In January, attorneys Carl Mayer and Bruce Afran asked me to be the lead plaintiff in a lawsuit against President Barack Obama and Defense Secretary Leon Panetta that challenged the harsh provisions of the National Defense Authorization Act (NDAA). We filed the lawsuit, worked for hours on the affidavits, carried out the tedious depositions, prepared the case and went to trial because we did not want to be passive in the face of another egregious assault on basic civil liberties, because resistance is a moral imperative, and because, at the very least, we hoped we could draw attention to the injustice of the law. None of us thought we would win. But every once in a while the gods smile on the damned. U.S. District Judge Katherine Forrest, in a 68-page opinion, ruled Wednesday that Section 1021 of the NDAA was unconstitutional. It was a stunning and monumental victory. With her ruling she returned us to a country where—as it was before Obama signed this act into law Dec. 31—the government cannot strip a U.S. citizen of due process or use the military to arrest him or her and then hold him or her in military prison indefinitely. She categorically rejected the government's claims that the plaintiffs did not have the standing to bring the case to trial because none of us had been indefinitely detained, that lack of imminent enforcement against us meant there was no need for an injunction and that the NDAA simply codified what had previously been set down in the 2001 Authorization to Use Military Force Act. The ruling was a huge victory for the protection of free speech. Judge Forrest struck down language in the law that she said gave the government the ability to incarcerate people based on what they said or wrote. Maybe the ruling won't last. Maybe it will be overturned. But we and other Americans are freer today than we were a week ago. And there is something in this.
'Am I on the 'No Fly' List?'—and other FAQs to the FBI Want to know if you're on it? That's classified. And trying to get off of it? No one can tell you how.
By Conor Friedersdorf - TheAtlantic.com
Days ago in Portland, Oregon, a federal attorney answered questions posed by Judge Alex Kozinski in a hearing about the government's classified watch lists for suspected terrorists, like the one colloquially referred to as the No Fly List. The ACLU has challenged the list on behalf of clients who think they're on it for reasons unknown to them and would like the chance to demonstrate they don't belong there. The problem? Federal authorities have set up a Kafkaesque system where you never get to know anything about why you're denied permission to fly.
Spy drone could have almost
brought down a plane in Colorado
RT.com
An airline pilot came close to crashing his plane near Denver, Colorado this week after encountering a mysterious object in the sky thought to be an unmanned drone aircraft.
A tape recording made available this week confirms that the pilot of a Cessna Citation 525 CJ1 radioed air traffic controllers outside of Denver on Monday after nearly colliding with an unidentified flying object. Several factors have suggested that the aircraft was most likely a robotic drone aircraft.
According to the record, the pilot came close to hitting what he described as "a large remote-controlled aircraft."
The Cessna's pilot says that the craft was encountered at around 8,000 feet above sea level, or 2,800 feet above the ground in near the highly elevated city of Denver.
Western wildfires:
Colorado declares emergency in Hewlett blaze
By Michael Muskal - LATimes.com
May 18, 2012, 9:24 a.m.
The Hewlett fire in Colorado has grown to 7,673 acres, prompting officials Friday to declare an emergency.
In an executive order, Colorado Gov. John Hickenlooper declared the emergency because of the fire in Larimer County. The move makes $3 million in state emergency funds available for firefighting.
"The Hewlett Fire's proximity to numerous homes and property poses an imminent danger to life and property and, therefore, constitutes a disaster for the purposes of the act," according to the executive order.
UFO Amnesty: Ex-Army Colonel John Alexander
Seeks Amnesty For Military Who Witness UFOs
By Lee Speigel - HuffingtonPost.com
If you're in the military and have ever seen what you believe to be a UFO, but were reluctant to mention it for fear of ridicule or, worse, repercussions that might end your career, take heart. Things may change.
A former military insider with top secret clearance who created Advanced Theoretical Physics -- a group of top-level government officials and scientists brought together to study UFO reports -- has just called on three of the highest-ranking military and intelligence officials in the Obama administration.
Magnitude-6.0 earthquake kills at least 4
in northern Italy cheese region, topples buildings
AP - WashingtonPost.com
SANT'AGOSTINO DI FERRARA, Italy — A magnitude-6.0 earthquake shook several small towns in northeast Italy Sunday, killing four people, knocking down a clock tower and other centuries-old buildings and causing millions in losses to the region known for making Parmesan cheese.
The quake struck at 4:04 a.m., with its epicenter about 35 kilometers (22 miles) north of Bologna at a relatively shallow depth of 5 kilometers (3.2 miles), the U.S. Geological Survey said. Civil protection agency official Adriano Gumina described it as the worst quake to hit the region since the 1300s.
Fukushima reactor No. 4 vulnerable to catastrophic collapse; could unleash 85 times Cesium-137 radiation of Chernobyl; human civilization on the brink
by Mike Adams, the Health Ranger
(NaturalNews) The news you are about to read puts everything else in the category of "insignificant" by comparison. Concerned about the 2012 U.S. presidential election? Worried about GMOs? Fluoride? Vaccines? Secret prisons?None of that even mattersif we don't solve the problem of Fukushima reactor No. 4, which is on the verge of a catastrophic failure that could unleash enough radiation toend human civilizationon our planet.
US Army General Warns of Impending Fukushima Doom A Natural Solutions Foundation Media Release: Maj. Gen. Albert N. Stubblebine III (US Army Ret.)'s Estimate of Situation about Fukushima, Japan, focusing on the immediate threat to the Northern Hemisphere emanating from the highly radioactive ruins of the 5 Fukushima nuclear reactors.
The Woodlands, Texas - PRWeb.com
Maj. Gen. Albert N. Stubblebine III (US Army Ret.), President of the Natural Solutions Foundation, an international NGO (non-governmental organization), released a 27 minute public service Estimate of Situation about Fukushima, Japan focusing on the immediate threat to the Northern Hemisphere emanating from the highly radioactive ruins of the 5 Fukushima nuclear reactors. The video is available without charge at http://www.GeneralBert.com.
Gen. Stubblebine's prognosis is dire: "When the highly radioactive Spent Fuel Rods are exposed to air, there will be massive explosions releasing many times the amount or radiation released thus far. Bizarrely, they are stored three stories above ground in open concrete storage pools. Whether through evaporation of the water in the pools, or due to the inevitable further collapse of the structure, there is a severe risk. United States public health authorities agree that tens of thousands of North Americans have already died from the Fukushima calamity. When the final cataclysm occurs, sooner rather than later, the whole Northern Hemisphere is at risk of becoming largely uninhabitable."
other viewpoint... Leuren Moret: Fukushima-depopulation update;
exposes Gen. Albert Stubblebine; offers solutions
In this exclusive wide-ranging May 15, 2012 interview with Alfred Lambremont Webre, independent scientist Leuren Moret, MA, PhD (ABD), updates the viewing audiences on the status of the ongoing Fukushima radiation-depopulation rollout, stating that "Fukushima radiation has taken over our planet." Leuren Moret also exposes inaccuracies in a recent Fukushima "Estimate of the Situation" video by former Gen. Albert S. Stubblebine (U.S. Army, Ret.). Stubblebine has publicly denied his involvement in a secret 1968 - 73 DARPA time travel and teleportation program despite direct eye witness whistleblower testimony to the contrary by Washington State attorney Andrew D. Basiago. Leuren Moret also offers solutions on how humanity can adapt positively to the challenges of this Fukushima radiation false flag depopulation plan, instigated by an international war crimes racketeering organization led by the Dutch and British Monarchs and City of London bloodline families including the Rothschilds.
6.2 magnitude earthquake strikes off the coast of Chile
TheExtinctionProtocol.com
May 18, 2012 – CHILE - A shallow 6.2 magnitude earthquake struck off the west coast of Chile at a depth of 10 km (6.2 miles). The epicenter of the earthquake was 542 km (336 miles) WSW of Castro, Los Lagos, Chile and some 1478 km (918 miles) SSW of SANTIAGO, Region Metropolitana, Chile. This is the second 6.2 magnitude earthquake to strike the coastal region of Chile in 4 days. A 6.2 quake struck Tarapaca on May 14. The Nazca plate is certainly letting us know that tension still resides on the plate. No tsunami warnings were issued with today's earthquake and there have been no reports of damage or injuries.
Jump in Gold as France Refutes EU Pact,
Portuguese Contingency Rumored,
Chinese Demand Overtakes India
By: Adrian Ash - GoldSeek.com
THE WHOLESALE MARKET gold price jumped at the start of New York trade on Thursday, cutting the week's previous 3.3% dive to 5-month lows in half as the Euro fell and Eurozone stock markets slumped once again.
The gold price touched $1558 per ounce before easing $3 lower. Silver did not follow, failing to break this morning's earlier Dollar high at $27.86 per ounce.
German Bund yields fell to fresh record lows, but Spain had to offer investors in new 3-year debt an annual yield of 4.37%, up from the 2.89% charged at the last comparable sale in April.
Backwardation in Gold And Silver
BY PATER TENEBRARUM - FinancialSense.com
On Monday, May 14, something happened that hasn't happened since Dec of 2008. Two successive near-month precious metals futures contracts were in backwardation at the same time. To oversimplify, backwardation is when the price of a futures contract is lower than the price in the spot market. It should not be possible for it to happen in gold and silver.
But ever since Dec 2008, it has been recurring intermittently, and recently it has become the "new normal" for each futures contract to head into backwardation before expiring.
Precious Metals Market Manipulation?
By Doug Casey, Casey Research - GoldSeek.com
For many years now, a meme has been floating around that the prices of gold and silver are being manipulated, which is to say suppressed, by various powers of darkness. This is not an unreasonable assertion. After all, the last thing the monetary powers-that-be want is to see is the price of gold skyrocketing. That would serve as an alarm bell, possibly panicking people all over the world, telling them to get out of the dollar. It's assumed, by those who believe in the theory, that the US Treasury is behind the suppression scheme, in complicity with a half-dozen or so large bullion banks that regularly trade in the metals.
Gold rise sharply by 216% in Turkish lira terms in 5 yrs: WGC
ANKARA (Commodity Online): The gold price has risen in all major currencies in recent years; in Turkish lira terms the price increased 216% between May 2007 and April 2012, said World Gold Council in its "Global gold market-first quarter 2012".
According to WGC, much of this increase was on the back of concerns regarding the European sovereign debt crisis as Turkey is a major trading partner in the region. Inflationary pressures and lacklustre performance of other financial assets contributed to the rise.
Selling in Gold largely coming from speculators: Commerzbank
LONDON (Commodity Online): The continuing slide in gold appears to be the result of selling by short term speculators, said Commerzbank, the second-largest bank in Germany, after Deutsche Bank.
The German bank stated that, "Because gold ETFs (exchange-traded funds) are still recording no significant outflows, speculative financial investors must be largely responsible for the price slide."
More Turmoil to Come, Buy Real Assets: Jim Rogers
By: Deepanshu Bagchee - Supervising Digital Editor, CNBC Asia
Jim Rogers, the chairman of Rogers Holdings, says he expects more turmoil in the global financial markets after several Asian stock markets on Friday fell to four-month lows.
"The world's got serious problems facing it, I don't particularly like saying it, but it's true," Rogers told CNBC.com on Friday morning in Singapore. "Unfortunately there will be more debt and currency turmoil to come."
Federal Reserve Board Vacancies Will Be Filled Today
By Matthew Yglesias - Slate.com
Today the U.S. Senate will break David Vitter's filibuster and put Jeremy Stein and Jerome Powell on the Federal Reserve Board of Governors. These are solid, banal, well-qualified picks. So solid and well-qualified, in fact, that it's a bit hard to know if it'll make a difference. What the Fed really needs at this point is a bit of outside-the-box thinking, but any kind of counterweight to the often cranky regional bank presidents should do some good.
Senate summons JP Morgan boss
Jamie Dimon to explain $2bn losses Tim Johnson, chairman of the Senate banking committee, said he wants to 'hear directly' from Dimon over trading losses
By Dominic Rushe - The Guardian
The Senate banking committee plans to call JP Morgan boss Jamie Dimon to Washington to explain how the bank lost $2bn in poorly-supervised trading.
Senator Tim Johnson, the chairman of the committee said it should "hear directly" from Dimon about the losses at America's biggest bank.
Johnson did not specify when he would ask Dimon to appear, but the committee has two meetings slated for May 22 and June 6, and any hearing with Dimon would have to come after that.
JP Morgan Unit has $100 Billion in risky bonds:
By: Sam Jones in London and Tracy Alloway
and Tom Braithwaite in New York - FT.com via CNBC.com
The unit at the centre of JPMorgan Chase's $2 billion trading loss has built up positions totalling more than $100 billion in asset-backed securities and structured products – the complex, risky bonds at the centre of the financial crisis in 2008.
These holdings are in addition to those in credit derivatives which led to the losses and have mired the bank in regulatory investigations and criticism.
No, None of This Makes Any Sense
BY FREDERICK J SHEEHAN - FinancialSense.com
After the financial crisis in 2008, "Too-Big-To-Fail" banks had to go. In 2006, the four largest banks - J.P. Morgan Chase, Bank of America, Citigroup, and Wells Fargo - held 33% of U.S. bank assets. Now, they hold 41% of U.S. bank assets and grow by the minute.
The Federal Reserve is, at least on paper, the country's leading bank regulator. Instead, it behaves like the TBTF banks' turbocharger. Federal Reserve Chairman Ben S. Bernanke is full of talk, and nothing else:
Keiser Report: Debt-a-holic Zombies (E289)
In this episode, Max Keiser and co-host, Stacy Herbert, discuss the Devil's Breath of too much debt and JP Morgan's black and blue dementia. In the second half of the show Max talks to Mike Maloney about gold, silver and Hollywood accounting.
Will Europe Lose the War Between the States?
By PATRICK SMITH, The Fiscal Times
The Greeks did something interesting Tuesday morning. In a highly controversial decision, Athens announced that it would pay those bondholders who refused to participate in last March's debt swap. Just 3 percent of Greece's private creditors hold $552 million in bonds that matured Tuesday out of a total bailout package worth $222 billion.
The payout infuriated bondholders who lost more than 70 percent of their investment in the debt swap and who may go to the courts to challenge the deal. But the move also prevented a legal challenge from those bondholders who held out for full price. It is almost certain that the timing of this risky announcement was purposeful. It coincided with another saying that coalition talks had failed on Tuesday after several days of effort and that Greece will have to hold new elections probably in June.
Who is Responsible for the Greek Tragedy?
By Mohamed A. El-Erian - Project-Syndicate.org
SEATTLE – Greece is following the road taken by several other crisis-ridden emerging economies over the past 30 years. Indeed, as I argued earlier this year, there are stunning similarities between this once-proud eurozone member and Argentina prior to its default in 2001. With an equally traumatic implosion – economic, financial, political, and social – now taking place, we should expect heated debate about who is to blame for the deepening misery that millions of Greeks now face.
There are four suspects – all of them involved in the spectacular boom that preceded what will unfortunately prove to be an even more remarkable bust.
Another point of view... will they or won't they? Greek Drama Don't believe the hype—
Greece isn't leaving the eurozone for now.
By Matthew Yglesias - Slate.com
All eyes are now on the possibility of a Greek exit from the eurozone. Indeed, it even has its own ridiculous portmanteau word—Grexit. Everyone from foreign financial institutions to the IMF is preparing for it, and the German government is telling anyone who'll listen that it's conceivable. So, is it really going to happen? Perhaps. And planning is prudent, certainly. But a short-term departure is much less likely than the hype would lead you to believe. Everyone has big incentives to bluff right now, but if Greece does end up leaving the euro it'll happen later as part of a broader and more comprehensive split.
Is there a tug of war going on, over Greece, the Euro, or the EU?
Greece Must Exit
By Nouriel Roubini - Project-Syndicate.org
NEW YORK – The Greek euro tragedy is reaching its final act: it is clear that either this year or next, Greece is highly likely to default on its debt and exit the eurozone.
Postponing the exit after the June election with a new government committed to a variant of the same failed policies (recessionary austerity and structural reforms) will not restore growth and competitiveness. Greece is stuck in a vicious cycle of insolvency, lost competitiveness, external deficits, and ever-deepening depression. The only way to stop it is to begin an orderly default and exit, coordinated and financed by the European Central Bank, the European Commission, and the International Monetary Fund (the "Troika"), that minimizes collateral damage to Greece and the rest of the eurozone.
"Greece Must Exit" comment by Paul Meyers....
The centerpiece of Roubini's argument is: "The only way to stop it is to begin an orderly default and exit." Only way? That's nonsense.
Greece makes up 2.5 percent of the European Union. If there was ever a situation ripe for "Can Do" leadership, it is here. The Europeans are going to let themselves come undone over 2.5 percent? This is an upside problem awaiting solution, not a cataclysm waiting to happen.
Roubini's criticism of the Troika is spot on. But the Troika is correctable. The Troika is just trying to refinance yesterday's mistakes, not create tomorrow's solution. That is a typical knee jerk solution by an elite...
"Men and women of Greece, it is with a sense of dignity and patriotic duty, that we made the decision not to betray your hopes and aspirations…The pro-bailout parties did not simply want us to support a government that would impose more austerity, they wanted us to agree to measures that would increase poverty and desperation. We didn't do them the favor." – Alexis Tsipras, Chairman of the Radical Left Coalition (Syriza)
The endgame for Greece is now in sight. Attempts to form a unity government have failed and public opposition to austerity is growing. The uncertain political situation has triggered a bank run which drained nearly $900 million in deposits from Greek banks on Monday alone. Panicky Greeks are moving their money out of the country fearing that a default will collapse the banking system or that an unexpected return to the the Drachma will slash their life savings in half. Withdrawals are pushing yields on German bund to historic lows, signalling rising anxiety. Absent the European Central Bank's Emergency Liquidity Assistance (ELA) program, the Greek banking system would have imploded already taking down creditors in Germany, England and France. But the ECB's aid will not last forever nor is it unconditional. If the anti-austerity parties take power in Athens, the bailouts will stop, capital flight will accelerate, and the banking system will crash.
Global banks see market rally on Greek exit Major global banks are advising clients to prepare for a stock market rally and a resurgence of the euro if Greece is forced out of monetary union, betting that world authorites will flood the international system with liquidity.
By Ambrose Evans-Pritchard - Telegraph.co.uk
Bank of America said it expects a "powerful short squeeze" in risk assets as speculative funds unwind positions, led by a rebound in battered bank stocks and Club Med bonds. The euro would surge 10pc to $1.40 against the US dollar after dipping first to $1.20 in the immediate panic.
The benign outcome assumes that the European Central Bank steps in with massive support, backed by the US Federal Reserve, the Bank of Japan, and key central banks along the lines of concerted action in 2008-2009.
We Are Watching The Greek Banking System Die
Right In Front Of Our Eyes
By Michael Snyder - TheEconomicCollapseBlog.com
Money is being pulled out of Greek banks at an alarming rate, and if something dramatic is not done quickly Greek banks are going to start dropping like flies. As I detailedyesterday, people do not want to be stuck with euros in Greek banks when Greece leaves the euro and converts back to the drachma. The fear is that all existing euros in Greek banks would be converted over to drachmas which would then rapidly lose value after the transition. So right now euros are being pulled out of Greek banks at a staggering pace. According to MSNBC, Greeks withdrew$894 million from Greek banks on Monday alone and a similar amount was withdrawn on Tuesday. But this is just an acceleration of a trend that has been going on for a couple of years. It has been reported that approximately a third of all Greek bank deposits were withdrawn between January 2010 and March 2012. So where has all of the cash for these withdrawals been coming from? Well, the European Central Bank has been providing liquidity for Greek banks, but now it has been reported that the ECB is going to stop providing liquidity to some Greek banks. It was not announced which Greek banks are being cut off. For now, the Greek Central Bank will continue to provide euros to those banks, but the Greek Central Bank will not be able to funnel euros into insolvent banks indefinitely.
A Surprising Conversation with Athens
BY BRUCE KRASTING - FinancialSense.com
If you read me on a regular basis you know that I speak with a fellow in Athens who is connected to the shipping industry and the government. I provide links below to some of those articles to establish this person's credibility. He's been pretty much right on things that have happened in his hometown.
I called him today to discuss the (now definitive) fact that there is no new government and elections will take place on June 16. What he said completely blew my mind.
Moody's downgrades Santander UK
along with 16 Spanish banks Shares in Bankia, Spain's fourth largest lender, also tumble as rumours spread of depositors withdrawing funds
By Giles Tremlett in Madrid - The Guardian
The credit rating agency Moody's has downgraded 16 Spanish banks along with Santander's UK arm, citing the Spanish government's reduced ability to shore up the banks.
Santander UK, whose rating was lowered to A2 – a notch higher than its Spanish parent – insisted there was no impact on its business and that it was an autonomous subsidiary with 90% of its assets held in the UK, where it is also regulated. Moody's admitted it was unlikely that the UK Financial Services Authority would allow Santander UK to substantially weaken itself in order to support the parent. increasing instability.
Are the Germans destined to save the euro? It is an article of faith in Berlin
that the single currency must survive, whatever the cost.
By Jeremy Warner - Telegraph.co.uk
If there is one characteristic that defines the German nation, it is "Entschlossenheit" – or single-minded determination and resolve. It is worth bearing this in mind when attempting to analyse the eurozone debt crisis. Never underestimate Germany's determination to make the euro work, a senior German industrialist cautioned me recently, after I'd reeled off the conventional Eurosceptic view of the currency – that eventually, and possibly quite soon, it would collapse under the weight of its own contradictions.
Germany Accepts Inflation to Save the Eurozone
BY MONTY GUILD0 WITH TONY DANAHER - FinancialSense.com
I have been closely watching the economics of these markets since 1970, and I have never dreamed that Germans would tolerate inflation anywhere near 4 percent. They are doing no less than reversing a policy that has governed German central banking for almost a century — since the terrifying German Weimar inflation of 1921 - 1924, which impoverished millions and led to a collapse of the German currency...and social fabric.
Germany cuts, US spends... Germany, U.S. head to G-8 summit
with starkly different economic policies
By Michael Birnbaum - WashingtonPost.com
BERLIN – There are 4,169 miles between Berlin and Washington. But on economic policy, the two capitals sometimes appear to be on different planets.
Germany has taken a tough-love, austerity-driven approach to solving Europe's recession, pushing struggling countries to sharply cut public spending and chop their debt even as their economies slump. The United States confronted its own crisis with an $862 billion stimulus package in 2009, which brought debt levels to heights not seen since shortly after World War II but may have dulled the worst blow of its downturn.
Greek euro exit would hit at home,
but fallout could be global
By Howard Schneider - WashingtonPost.com
Spiralling inflation. A collapsed banking system. Hundreds of billions of dollars in unpayable debts and likely isolation from the world financial community.
That much Greece can count on — at least initially — if its political paralysis continues and it leaves the euro.
But the fallout would extend well beyond Greece's borders, and analysts have been struggling to grasp whether it would upend markets as the collapse of Lehman Brothers did in 2008 or — if Europe's financial systems prove durable and its politicians adept in response — simply pass with a shrug.
What Will a Greek Default Mean for You?
BY JEFF RUBIN - FinancialSense.com
With Greece on the verge of default, we're about to learn how little has really changed since governments around the world wrote the last round of bail out checks to prop up failing financial institutions. Just as the collapse of the US subprime mortgage market rippled into nearly every corner of the global financial system, so too will a pending default by Greece.
Russia Stays Home
By Javier Solana - Project-Syndicate.org
MADRID – Just three days before his return to the Kremlin as Russia's president, Vladimir Putin met behind closed doors at his residence in Novo-Ogaryovo, outside Moscow, with US National Security Adviser Tom Donilon, who was there to transmit President Barack Obama's renewed determination to strengthen cooperation with Russia. But Donilon returned home empty-handed: Putin will attend neither the G-8 summit on May 18-19 at Camp David, nor the NATO summit in Chicago on May 20-21, despite Obama's effort to accommodate Russia by moving the G-8 summit from Chicago.
Barack Obama tells EU: boost growth now or face a global crisis Germany to be urged to ease austerity
during G8 talks as fears of global recession grow
By Larry Elliott, Jill Treanor, Nicholas Watt
and Ewen MacAskill in Washington - Guardian.co.uk
Barack Obama is to put pressure on Germany to ease the pain of austerity with policies to boost growth, as he uses two days of talks with the G8 industrial nations to warn Europe it needs to act swiftly to spare the world economy from a second deep recession in four years.
Ahead of the G8 summit, at Camp David this weekend, a warning from the ratings agency Fitch that Greece's days in the single currency could be numbered heightened fears in Washington that the worsening crisis in the eurozone poses a threat to America's fragile recovery and President Obama's re-election chances.
G8 at Camp David: what the world wants to achieve Guardian reporters analyse the wishlists of the world's leaders who are meeting at Barack Obama's presidential retreat in Maryland
By Ian Traynor, Ewen MacAskill, Luke Harding,
Tom Kington, Heather Stewart and Graeme Wearden - Guardian.co.uk
Briefing the German parliament last week on expectations of Camp David, Chancellor Angela Merkel emphasised less what she wanted than what she did not want.
"There can be no growth through borrowing," she declared, in a statement delivered on the issue of the global economy, but which seemed more directed at Europe. "That would just take us back to the start of the crisis."
Obama's Lit Agency Used 'Born in Kenya' Bio Until 2007
By Ben Shapiro - Breitbart.com
According to archive.org, a website that caches websites on a regular basis, the Dystel.com website – the official website for Dystel & Goderich, Obama's literary agents – was using the Barack Obama "born in Kenya" language until April 2007, just two months after then-Senator Obama declared his campaign for the presidency.
THE VETTING - EXCLUSIVE -
OBAMA'S LITERARY AGENT IN 1991 BOOKLET:
'BORN IN KENYA AND RAISED IN INDONESIA AND HAWAII'
by JOEL B. POLLAK - Breitbart.com
Andrew Breitbart was never a "Birther," and Breitbart News is a site that has never advocated the narrative of "Birtherism." In fact, Andrew believed, as we do, that President Barack Obama was born in Honolulu, Hawaii, on August 4, 1961.
Yet Andrew also believed that the complicit mainstream media had refused to examine President Obama's ideological past, or the carefully crafted persona he and his advisers had constructed for him.
It is for that reason that we launched "The Vetting," an ongoing series in which we explore the ideological background of President Obama (and other presidential candidates)--not to re-litigate 2008, but because ideas and actions have consequences.
Planning $10 Million Worth of Jeremiah Wright Attacks
Makes Sense Even if It Doesn't Work
By Matthew Yglesias - Slate.com
Joe Ricketts is the founder of TD Ameritrade. He's really rich, and he really dislikes Barack Obama. He's working with longtime GOP operative Fred Davis on a way to spend $10 million venting that anti-Obama rage with a series of racial attacks on Obama. This prompts Ben Smith to ask "do people think Jeremiah Wright attacks are going to work at this point?"
Super PAC Considers Scathing 'Wright' Attack on Obama
by WILLIAM BIGELOW - Breitbart.com
A billionaire whose family owns the Chicago Cubs is considering a proposal to help fund a strongly provocative campaign against Barack Obama. Joe Ricketts, the founder of the brokerage firm TD Ameritrade, may get behind a group of high-profile Republican strategists and their proposal, which is overseen by Fred Davis. The 54-page proposal, professionally bound and illustrated with color photographs, includes calls for running commercials linking Obama his former spiritual adviser, Jeremiah Wright, whose famous "God Damn America" comments were reflective of his racist ideology.
Hillary Clinton paid off other Black Preachers
to attack Rev. Wright
Wright told Klein that a fellow faith leader approached him in 2010 to allege that it wasn't just Republicans who were working to exploit his fiery image. The controversial pastor claimed that another preacher told him that the Hillary Clinton campaign was paying African American reverends to openly attack Wright.
The President's 'Other Gospel'
By Cal Thomas - PatriotPost.us
It is one thing to talk about "fairness" when it comes to allowing gays and lesbians to marry; it is quite another to claim biblical authority for such relationships.
President Obama cited the "Golden Rule" about treating others as you would like to be treated, but in doing so he ignored the totality of Scripture and the Lord Himself, who alone gets to set the rules for human behavior.
The president says he is a "practicing Christian." It is difficult to be one while simultaneously holding a low view of the Bible, which his position on several social issues might suggest.
Hewlett-Packard mulling 25,000 to 30,000 job cuts
to cope with dwindling PC demand
By AP - WashingtonPost.com
SAN FRANCISCO — Hewlett-Packard is poised to eliminate as many as 30,000 jobs to compensate for dwindling demand for personal computers as more people connect to the Internet on smartphones and tablets, according to reports published Thursday.
The looming cuts cited by Bloomberg News and the technology blog All Things D would trim as much as 9 percent of HP's workforce, based on the 349,600 people employed by the Palo Alto, Calif., company as of last October. A breakdown on HP's website listed 324,600 employees, but company spokesman Michael Thacker said the information was wrong. He pointed to the October figure listed in HP's annual report as the most accurate head count.
Postal Service moving ahead with closing mail sorting hubs, though closures will move slowly
By Lisa Rein - WashingtonPost.com
The U.S. Postal Service, facing mounting losses, said Thursday it is moving ahead with plans to close hundreds of mail sorting hubs and cannot wait for Congress to pass legislation to help it out of its financial hole.
But the closing of 232 processing centers will be phased in over three years instead of the faster pace postal officials announced last fall.
"After input from our customers, we've modified our approach," Postmaster General Patrick Donahoe said at a news conference. "But the sobering reality is that the First Class mail [volume] will not return."
Health Care: No, the State Doesn't Know Best
By Jeff Jacoby - PatriotPost.us
Prices were out of control at the end of 3rd-century Rome, and the Emperor Diocletian was determined to rein them in. In AD 301 he issued his famous Edict on Prices, a complex piece of legislation that banned speculation and established price ceilings for a wide range of goods and services. But the ambitious law failed. Though violators could be punished with death, inflation and speculation persisted. Goods were hoarded, or sold on the black market. The economic crisis worsened. Eventually the law was abandoned. Like countless rulers before and since, Diocletian discovered the hard way that price controls don't work. They worsen the problem they are intended to solve, leading to shortages, rationing, and even higher prices.
Minority Opinions Hardly anyone responds to public opinion surveys anymore.
Can we still trust them?
By Will Oremus - Slate.com
When you get a call on your cellphone from an unfamiliar number, do you answer it? If the person on the other end of the line immediately tries to assure you they're not trying to sell you anything, do you believe them? If they tell you they're conducting a public opinion survey that will only take a few minutes of your time, do you go ahead and start sharing your views on religion, gay marriage, the economy, and the upcoming election?
Americans Elect abandons bid to end two-party stranglehold Electoral group fails to generate enough support from ordinary voters to fulfil its own requirements – and shuts down
By Paul Harris - Guardian.co.uk
Americans Elect, a well-financed group that aimed to help a viable third party candidate enter this November's presidential race, has announced it is ending its web-based push to break America's two-party system.
The organisation, which was founded with millions of dollars from its initial wealthy backers, had little trouble in organising a push to get on the ballot across America. It managed to secure ballot access in 29 states and was on track in all the rest. But it failed to attract a big-name candidate to join it or generate enough popular support from ordinary Americans to fulfil its own requirements to accept a candidate.
Beyond Americans Elect's flop:
The case (still) for a bolder center
By Matt Miller - WashingtonPost.com
The False Equivalency Police are dancing on Americans Elect's grave, claiming the group's failure to attract viable independent candidates proves the entire enterprise was misbegotten. What's more, these critics add, Americans Elect's flop shows that the whole thing was always a sideshow pushed by centrist pundits whose professional identity is wrapped up in the phony notion that Democrats and Republicans are equally to blame for our current predicament.
12 Pictures That Demonstrate
How The New World Order Openly Mocks Us
By Michael Snyder - EndOfTheAmericanDream.com
If you know what to look for, it quickly becomes obvious that the elite of the world are not even trying to hide their insidious plans for the planet. They hope to unite the entire globe under their leadership, and they don't think that we are strong enough or smart enough to stop them. They openly embed symbols expressing their desire for a one world economic system, a one world religion and a one world government on our buildings, on our monuments and on our money and they think that it is funny that most people have no idea what those symbols mean. The New World Order openly mocks us and they seem to take pleasure in giving us "clues" about what their plans for humanity are. In the "global society" that they have planned for us, individual freedoms and liberties will be greatly restricted "for the good of humanity" and they will use the emerging Big Brother police state control grid to monitor and control everything that we do. It would be a totalitarian regime unlike anything the world has ever seen before. That is why it is absolutely imperative that we wake people up and get them educated about what the globalists plan to do so that they can resist this growing tyranny.
Weather-Related Disasters on the Rise
By MERRILL GOOZNER, The Fiscal Times
If you don't have enough to worry about with the stock market sagging and the economy in the doldrums, ponder these facts: The U.S. just experienced the hottest 12 months since the National Weather Service began keeping records in 1895; extreme weather events are on the rise around the globe; and the Midwestern grain belt is overdue for a major drought.
This isn't a story about climate change or a subtle advertisement for hybrid vehicles. Global warming wasn't even a concept during the 1930s dust bowl, the rain-scarce late 1950s or the major droughts that hit the U.S. plains in 1980 and 1988.
Why the World's Unemployed Youth are Flocking to Brazil
By Joel Bowman - DailyReckoning.com
05/16/12 Rio de Janeiro, Brazil – Man wasn't supposed to labor like this. Not under these conditions…with a clear view of a clearer sea…a white sandy beach below his room…the sound of the crashing waves gently carrying through his window…
…and his head stuck firmly in his computer screen.
But we will soldier on, Fellow Reckoner. We will ignore the blissful and beckoning distractions of one of the world's most famous esplanades just across the way. We will pretend the little cabanas down by Ipanema's Post 10 have exhausted their supplies of frosted, cachaça-based refreshments and that the hot bods tanning on the sand and frolicking in the water are really just figments of our imagination. We will turn away from this little heaven on earth and cast our gaze, instead, upon its equal and opposing force…
…but not just yet.
How Brazil Broke Loose
By Mark Roe, João Paulo Vasconcellos - Project-Syndicate.org
CAMBRIDGE – Brazilian President Dilma Rousseff's visit last week to Washington, DC, offers an occasion to consider how some once-poor countries have broken out of poverty, as Brazil has. Development institutions like the World Bank have advocated improving business law as being essential to success. Are they right?
Such thinking goes back at least as far as Max Weber's argument that an effective business environment requires a legal structure as predictable as a clock. Investors, it is thought, need clear rules and effective courts. Security of contract and strong mechanisms that protect investors are, in this view, foundational for finance, which in turn fuels economic growth. If a potential financier is unsure of being repaid, he or she will not invest, firms will not grow, and economic development will stall. Rules and institutions come first; real economic development follows.
Facebook's Value:
What's the Price of a Billion People Watching Each Other? Will Facebook's business model be more like Google, the New York Times, or TV? To be worth $100+ billion, it will have to be something much more.
By Derek Thompson - TheAtlantic.com
Is Facebook's IPO the next chapter in the greatest company of our time, or are Friday's buyers total suckers?
The only intelligent, honest, and true thing to say about this inevitable question is that nobody has any clue. In 1992, a company called America Online had a $70 million valuation after its IPO. A decade later, it was worth $150 billion. A decade after that peak, it is now worth only $1 billion. Online fortunes are built on hyper-active tectonic plates. Mountains of wealth accumulate from flat nothingness, rumble, push up toward the sky, and with alarming frequency, blow themselves up. The Internet is a super-seismic place.
Facebook's IPO: Who's Selling and How Much
By YUVAL ROSENBERG, The Fiscal Times
Even as outsiders line up to get a piece of Facebook, the social media giant's latest filing shows that early individual and institutional investors will be selling nearly 84 million more shares than originally planned. And even as the frenzy surrounding the offering builds – or perhaps because of it – Facebook is facing renewed scrutiny over its business model and the risks it faces.
The company revised its S-1 filing with the Securities and Exchange Commission twice in two days this week, with the latest document reflecting new plans to sell more than 421 million shares, up from 337.4 million, as early investors look to cash out more of their holdings. Those investors would face a lockup period of at least 91 days during which they could not sell once the stock is publicly traded.
Facebook's Eduardo Saverin
Saves $67 Million in Tax by Leaving U.S.
By Jesse Drucker - WashingtonPost.com
May 16 (Bloomberg) -- Facebook Inc. co-founder Eduardo Saverin will save at least $67 million in federal income taxes by dropping U.S. citizenship, according to a Bloomberg analysis of the company's stock price. Those savings will keep growing if Facebook's shares increase.
Saverin renounced his citizenship around September and he lives in Singapore, according to his spokesman, Tom Goodman. Saverin, 30, was part of a small group of Harvard University students who started the social networking site. He owns about 4 percent of the company, according to whoownsfacebook.com.
More ads for YOU... to 'like' What Does Facebook's $100 Billion IPO Mean for You?
More ads.
By Farhad Manjoo - Slate.com
When Facebook filed for its initial public offering in February, Mark Zuckerberg wrote a frank letter to potential investors in the firm. "Facebook was not originally created to be a company," he began. "It was built to accomplish a social mission—to make the world more open and connected." The founder went on to say that while making money was important to Facebook, raking in cash was not its primary goal. "Simply put: we don't build services to make money; we make money to build better services."
Real Estate Crash in China Underway
BY MICHAEL SHEDLOCK - FinancialSense.com
Inquiring minds are reading an excellent report China Real Estate Unravels by Patrick Chovanec, a professor at Tsinghua University's School of Economics and Management in Beijing, China.
The report confirms many of the things I said would happen in regards to the Chinese real estate bubble and GDP.
Here are a few items of note.
Developers, burdened by 70% leverage ratios and loans threatening to come due, rushed to complete projects already in their pipeline, to put those units onto the market and raise cash.
trade wars heating up...
US commerce department brings heavy tariffs
against Chinese solar panels Investigation finds China kept prices low with subsidies, but some in US warn tariff will slow adoption of solar energy
By Suzanne Goldenberg - Guardian.co.uk
The Obama administration imposed heavy tariffs on Chinese solar panels on Thursday, after finding that China is flooding the market with government subsidised products.
The preliminary decision, that China had dumped solar products on the US for less than the cost of manufacture, will result in tariffs of between 31% and 250% on Chinese imports.
It was seen on Thursday as a mixed blessing.
Getting America on the Hook Is Syria Going Straight to Hell?
by PETER LEE - CounterPunch.org
Back in February I wrote for Asia Times about the Chinese diplomatic initiative on Syria, which is now largely represented by the Annan peace plan. At the time, I wrote China's plan had a chance, albeit slim, because, for all the brave talk emanating from the Gulf, Turkey, the EU, and the West nobody seemed particularly eager to step up and destroy the Assad regime.
Simply imploding the Assad regime to spite Iran would appear to be easy, but has not happened.
Turkey is already providing safe havens for the Free Syrian Army, but apparently has not unleashed it. Western Iraq is aboil with doctrinaire Sunni militants happy to stick it to the Alawite regime, and Qatar has allegedly already laid the groundwork for underemployed Libyan militants to find profitable occupation fighting alongside the opposition in Syria, but utter bloody chaos has yet to erupt.
A Line-by-line Analysis of
National Defense Authorization Act, Nuclear Provisions
Gutting START; Re-Starting a Nuclear Arms Race
by ROBERT ALVAREZ - CounterPunch.org
The U.S. House of Representatives will soon take up the proposed National Defense Authorization Act for Fiscal Year 2013. (H.R. 4310). Attached is a section by section analysis of the nuclear weapons provisions I did over the past couple weeks. Also, here is the web-linkto the White House Statement of Administration Policy (SAP) regarding this legislation.
Democratic members have been denied the opportunity to offer amendments to strike and/or modify several provisions. House Republicans have cobbled together the most bellicose nuclear arms policy since the height of the Cold War. In doing so, they restore the "production over safety" policy that left behind an enormous human and environmental legacy. Specifically, this bill:
Get Ready: We're About To Have Another 2008-Style Crisis
by Chris Martenson - ZeroHedge.com
Well, my hat is off to the global central planners for averting the next stage of the unfolding financial crisis for as long as they have. I guess there's some solace in having had a nice break between the events of 2008/09 and today, which afforded us all the opportunity to attend to our various preparations and enjoy our lives.
Alas, all good things come to an end, and a crisis rooted in 'too much debt' with a nice undercurrent of 'persistently high and rising energy costs' was never going to be solved by providing cheap liquidity to the largest and most reckless financial institutions. And it has not.
Gold to Hit $1,900 by Year End: Commodities Pro
By: Tom Mackenzie - CNBC.com
The recent sell-off in gold is unlikely to continue in the longer term, with the precious metal set to hit $1,900 an ounce towards the end of the year, according to Walter De Wet, head of commodities at Standard Bank.
"If the dollar is strong and the euro weak, gold trades lower, but ultimately it de-links especially when we get more money printing," De Wet told CNBC's "Closing Bell Europe." "Longer term we still think it's going to go up."
De Wet says two things need to happen for gold to rise. "First of all we need the uncertainty to settle," he said. "Like any other assets, gold sells off when people want liquidity."
Canary In The Gold Mine: In Historic Move, Japanese Pension Fund Switches To Gold For First Time Ever
Submitted by Tyler Durden - ZeroHedge.com
As US weak hands keep piling out of gold whether to make space for the Facebook IPO tomorrow, or just to load up on paper currencies in advance of central banks printing much more, two things have happened: China is now on its way to becoming the biggest source of gold demand, surpassing India, but more importantly as of hours ago, in a truly historic move, "Okayama Metal & Machinery has become the first Japanese pension fund to make public purchases of gold, in a sign of dwindling faith in paper currencies."
The Strong Dollar Leads to a Fall in Commodity Prices
By Mad Hedge Fund Trader - OilPrice.com
Panic is on deck, to use the baseball terminology that my foreign readers are often attempting to decipher. That is the only conclusion one can reach after getting gob smacked by the price action this morning. Copper got spanked for eight cents, oil burned $2, gold shed another $26, and silver puked 70 cents.
The tantrum like stock behaviour in producing and equipment companies, like Freeport McMoRan (FCX) and Caterpillar (CAT) has been atrocious. How many of you out there know that JP Morgan (JPM) is the largest holder of futures contracts in the silver market and just got hit with a massive margin call? Why is all this happening on the 100 year anniversary of the sinking of the HMS Titanic?
The Quiet Revolt
BY RICHARD RUSSELL - FinancialSense.com
I just received a large full-color pamphlet in the mail and in large letters it read, "The free ride is over. The dollar will soon be devalued and replaced." I thought the warning was interesting, but the operative word was "soon".
I've been writing about this same set of circumstances, but it's the timing that is unclear. When will the dollar be devalued -- in a month, six months two years? Actually, the dollar is being devalued each time the Fed comes up with another quantitative easing. But you don't know it unless you try to buy a car or a batch of food from Safeway. Whew!
Investors favour dollar over gold
even as Goldman Sachs sees rally While Goldman Sachs predicts record gold prices in the next 12 months, investors are reducing their gold holdings for a third month and choosing the dollar as a haven from Europe's debt crisis.
Author: By Joe Richter - Mineweb.com
BLOOMBERG - Investors are reducing gold holdings for a third month, the longest stretch since 2004, and favoring the dollar as a haven from Europe's debt crisis, even as Goldman Sachs Group Inc. predicts record prices for the metal.
Bullion erased its gains for 2012 this week as the dollar rose against a basket of currencies for a record 12 straight days. Gold held in exchange-traded products fell 30.8 metric tons since reaching a record 2,410.2 tons on March 13, data compiled by Bloomberg show. Royal Bank of Scotland Plc, ABN Amro Bank NV and Barclays Plc cut their forecasts in May, though Goldman expects prices to rise 25 percent to $1,940 an ounce in 12 months.
Gold adds to losses as Greek uncertainty remains
News ECB might cut off Greek banks sends gold, other metals lower
By Claudia Assis and Chris Oliver, MarketWatch
SAN FRANCISCO (MarketWatch) — Gold fell for a fourth day Wednesday as concerns about Greece's finances drained investors' appetites for risk and helped push the U.S. dollar higher.
Gold also added to its loss after news that the European Central Bank would be cutting off money to Greek banks, although in a separate report the ECB said it would continue to support that country's banking system.
The Next Money:
As the Big Economies Falter, Micro-Currencies Rise More consumers are walking away from fiat currencies to drive commerce -- and society -- with new ways of buying.
By Eric Garland - TheAtlantic.com
People everywhere are fed up with the status quo of the economy. With the passion our official institutions show for this tepid "recovery," many are concluding that progress will come not from the current system, which is after all what got us here in the first place, but from their own ingenuity and inventiveness. In pockets around the world, folks are declaring economic independence by starting small, local, but potentially revolutionary alternative currencies that could change not only how we buy goods and services -- but how we relate to one other in society. If these micro-currencies catch on, we could be witnessing the replacement of our monocultural monetary system, which emphasizes a certain sort of free market capitalism above all else, with a variety of currencies that will represent more diverse sets of values belonging to the groups that hold them.
The Elite Are Digging Their Own Grave
Today, Wednesday, May 16, on the Alex Jones Show, Alex welcomes long-time returning guest and contributing writer Dr. Paul Craig Roberts to discuss the impact of the Euro's instability on world markets amidst looming fears of Greece's departure. They'll also touch on why governments feel compelled to blame events like 9/11, the Euro decline, and other manufactured crises on scapegoats.
Is Greece the Lehman of 2012?
By Paul R. La Monica - Money.CNN.com
NEW YORK (CNNMoney) -- With apologies to John Lennon: Imagine a eurozone without Greece. It's easy if you try.
That seems to be Wall Street's tune these days. Sure, investors are worried about Europe. And they should be. But so far, the market is acting as if the recent turmoil in Greece is merely a repeat of last summer -- and not the second coming of 2008.
Stocks have pulled back from this year's earlier highs, but it's been a fairly orderly sell-off, not a full-blown panic.
Euro fears rise as Greeks withdraw money from banks
BY VALENTINA POP - EUObserver.com
BRUSSELS - Greeks have withdrawn billions of euros from their banks in recent days, with the country's president warning of "panic" at the prospect of the country leaving the eurozone.
"My family already sent some €20,000 of our savings to my sister, who lives in Switzerland," says M.S., a Greek citizen who lives in Brussels and works in the financial sector.
Like him, many Greeks are either transferring their savings abroad or taking them out of the banks, driven by fear that the country may have to leave the eurozone.
'Vulture funds' circle as Greece fears grow
As Greeks rush to withdraw savings, bailout fund pays US tax exile €400m
by STEPHEN FOLEY and NATHALIE SAVARICAS - Independent.co.uk
An American tax exile living in the Cayman Islands has emerged as a winner from the chaos engulfing Greece, even as the political and economic turmoil in the beleaguered nation deepened yesterday, with Athens putting a senior judge in charge of an emergency government to lead it to fresh elections.
Kenneth Dart, the Michigan-born heir to a disposable cups fortune, was handed an estimated €400m (£320m) cheque from Greece this week, after successfully calling the country's bluff and refusing to take part in the restructuring of government debt that saved Greece from default in the spring.
World Banks have the Power
to save the Global Economy, if they want to
By David Beckworth - OilPrice.com
The global economy appears to be headed over cliff this year. The emerging world is experiencing a significant economic slow down, the Eurozone will probably break apart in the next few months, and the United States faces sharp austerity measures at the end of the year. There are enough bearish developments here to make the original Mayan calendar look prescient after all. So should we despair? Is the global economy fated to collapse in 2012?
No, says Willem Buiter and Ebrahim Rahbari of Citigroup. Though the outlook is dire, they argue there is much more the Fed, the ECB, the Bank of Japan, and the Bank of England could do not only to prevent another global economic collapse this year, but also to spur global aggregate demand above its anaemic levels as seen below:
Cost of Greek exit from euro put at $1tn UK government making urgent preparations to cope with the fallout of a possible Greek exit from the single currency
By Larry Elliott, Jill Treanor and Patrick Wintour - The Guardian
The British government is making urgent preparations to cope with the fallout of a possible Greek exit from the single currency, after the governor of the Bank of England, Sir Mervyn King, warned that Europewas "tearing itself apart".
Reports from Athens that massive sums of money were being spirited out of the country intensified concern in London about the impact of a splintering of the eurozone on a UK economy that is stuck in double-dip recession. One estimate put the cost to the eurozone of Greece making a disorderly exit from the currency at $1tn, 5% of output.
Debt crisis: Greek euro exit looms closer as banks crumble A tsunami of capital flight from Greece threatens to overwhelm the authorities, forcing the country out of the euro before fresh elections in June.
By Ambrose Evans-Pritchard - Telegraph.co.uk
Economists warned that the Greek financial system could crumble within weeks or days unless the European Central Bank steps up support.
President Karolos Papoulias told party leaders that banks had lost €700m in withdrawals on Monday alone as citizens rush to pre-empt capital controls and a much-feared return to the Drachma.
He cited central bank warnings that "great fear" might soon escalate to panic. The leaked details lend credence to claims that capital flight by both savers and firms have reached €4bn a week since the triumph of anti-bailout parties on May 6.
Greeks withdraw €3bn in 10 days since election
Greece's savers making daily bank visits as analysts warn faster capital flight could push country out of euro before June's poll
By Helena Smith in Athens and Jill Treanor - Guardian.co.uk
Greeks have withdrawn €3bn (£2.4bn) from the banking system since the country's inconclusive elections on 6 May, with tellers saying savers were making two or three visits a day to local banks.
Savers fear Greece leaving the eurozone and returning to the drachma. An aide to the outgoing prime minister, Lucas Papademos, said there were "serious fears that the banks were running out of money".
Greece gets worst of worlds with no euro decision
Extraordinary action from Merkel, Hollande needed
By MarketWatch
WASHINGTON (MarketWatch) — It seems almost hard to believe that the Greek situation has taken a turn for the worse, but it now has, with reports that deposits are fleeing the country and that some of its banks have now completely depleted their capital.
That's the result of a Greek election that produced no mandate for anything — not definitely for the bailout, or against it, or even for getting enough politicians to form a semi-functioning government.
Greece's Balkan Inheritance Is Heavy
By William Pfaff - Truthdig.com
The Balkans are historically apart from Europe for two reasons, one religious and the other political.
This has everything to do with the present crisis of Greece and the future of Greece's membership in—or perhaps its departure from—the European Union and its eurozone. To understand what is happening, it is necessary to understand something of the past.
Geography and the Great Schism in the development of Christianity left all the Balkan peoples in the Orthodox half of the Christian world, separating them from the Western Europe of Roman Catholic and Protestant religion, the Renaissance and scientific revolution, from which the modern Enlightenment West has emerged.
Germany will blink and won't let Greece exit euro Marshall Plan–style aid would give Athens time
By Matthew Lynn
LONDON (MarketWatch) — It doesn't take long for an idea to become an accepted fact in the markets.
Six months ago, Greece's leaving the euro was seen as so unlikely that nobody had to think seriously about. Now the "Grexit" — as a Greek exit from the euro zone has been dubbed — is increasingly seen as a done deal.
Citibank rates the chances as high as 75% that Greece will leave the single currency in the next 18 months. The British bookmaker William Hill regards it as such as done deal it is no longer taking bets.
Britain must make ready for the storm
as clueless Europe tears itself apart Once every half century or so, Europe "tears itself apart" in an orgy of self-destructive national tribalism. It happens just like clockwork.
By Jeremy Warner - Telegraph.co.uk
Usually it's war that does the damage; there's a certain irony in the fact that this time around it's a project designed to prevent these periodic outbreaks of insanity by binding nations together in irredeemable economic and legal union – the euro.
In fact, the single currency is having the exact opposite effect, only bizarrely, Europeans still refuse to see it. Even the Greeks still cling, ever more desperately, to this totemic symbol of European solidarity.
Could a Carbon Tax Save Europe? A new report argues that reforming how Europe treats energy could, by 2020, cut some countries deficits in half
By Tim McDonnell - TheAtlantic.com
Turmoil over budget cuts roils Greek streets. France elects an anti-austerity president. Even Germany's Austerity Queen Angela Merkel faces electoral backlash. It appears Europeans are getting sick of tightening their belts. But when you can't cut any more, there's little else to do but hustle up more cash.
For governments allergic to raising income taxes, a European Climate Foundation analysis released yesterday shows there's a less painful way to slash deficits -- one that could save the planet as it saves the economy. A carbon tax.
Outgoing World Bank chief: Fix eurozone
By Jennifer Liberto - Money.CNN.com
WASHINGTON (CNNMoney) -- Outgoing World Bank President Robert Zoellick said Wednesday he's concerned about the "ripple effects" on the rest of the eurozone if Greece leaves.
"The core question will actually not be Greece, it's Spain and Italy," Zoellick said during a forum sponsored by the Economic Club in Washington. "If Greece does leave, frankly, there has to be a lot of care taken to how that's done."
Zoellick said the situation was comparable to Lehman Brothers' collapse in 2008 and the unanticipated global repercussions on the financial markets. In Greece's case, the problem is the inter-connectiveness of economies, especially in Europe.
Federal Reserve concerned about fiscal cliff
By Annalyn Censky and Karen McGowan - Money.CNN.com
NEW YORK (CNNMoney) -- The Federal Reserve is worried about indecision in Congress.
At its last meeting in April, the central bank's top officials discussed how coming tax increases and spending cuts could weigh on the recovery, and debated whether the Fed should provide additional stimulus to spur consumer spending.
Federal Reserve members
ready to step up support for US economy Federal Reserve policymakers said on Wednesday that they were open to further efforts to stimulate the US economy if growth falters or threats escalate.
AFP - Telegraph.co.uk
Minutes of the central bank's April 24-25 meeting stated that "several members" thought additional Fed support could be needed if the recovery lost momentum or if the risks to the economy became great enough.
The minutes did not spell out what circumstances would trigger further Fed efforts to lower interest rates to boost the economy. But they did note some threats to the US economy. One is Europe's debt crisis. Another is the risk that spending cuts and tax increases that could take effect at year's end if Congress can't reach a budget agreement could slow growth more than expected.
Clinton: Debt deal should be top campaign issue
By Jennifer Liberto - Money.CNN.com
WASHINGTON (CNNMoney) -- President Bill Clinton on Tuesday said those running for office should make reaching a debt deal the top campaign issue in the fall's elections.
"I think this budget issue should become front and center in this election, Clinton said on Tuesday at a fiscal summit sponsored by the Peter G. Peterson Foundation.
"As soon as this election is over, I think the incentives will be there for both parties to make more compromises than they have in the past," Clinton added later.
JPMorgan Fallout 'Could Get a Lot Worse': Whitney
By: Jeff Cox - CNBC.com
The JPMorgan Chase trading controversy comes at an inopportune time both for the bank and the industry as a whole, which needs to rethink the way it does business, analyst Meredith Whitney told CNBC.
As the fallout continues over the banking titan's $2 billion hedging loss, Whitney, head of Meredith Whitney Advisory Group, said the imbroglio fuels calls in Congress for more banking regulation and exposes the general weakness of large financial institutions.
JPMorgan's Trading Loss Is Said to Rise at Least 50%
BY NELSON D. SCHWARTZ
and JESSICA SILVER-GREENBERG - NYTimes.com
The trading losses suffered by JPMorgan Chase have surged in recent days, surpassing the bank's initial $2 billion estimate by at least $1 billion, according to people with knowledge of the losses.
When Jamie Dimon, JPMorgan's chief executive, announced the losses last Thursday, he indicated they could double within the next few quarters. But that process has been compressed into four trading days as hedge funds and other investors take advantage of JPMorgan's distress, fueling faster deterioration in the underlying credit market positions held by the bank.
Jamie Dimon's Hedge Fund
By Abigail Caplovitz Field - NakedCapitalism.com
Jamie Dimon, John Stumpf, and to a lesser extent, Vikram Pandit and Bryan Moynihan, are running massive hedge funds. They're placing enormous, incredibly risky bets. "Hot money" investors are giving them the cash to gamble because they all understand that you and me will make good on any losses, since we've started guarantying the banks-turned-hedge-funds as "Too big to fail."
The money flowing to these gamblers-in-chief is growing by double digit percentages, and includes so much borrowed money the "leverage" may be six times what Lehman Brothers was doing when it flamed out. As long as this situation continues, a new financial crisis is inevitable, and the risks of it grow faster every day. There's only one solution: cut these gamblers off from public support. The market will do the rest.
Obama has a large JPM account Obama financial forms show big JP Morgan account
By Olivier Knox | The Ticket - Yahoo News
Maybe it's a case of putting your mouth where your money is.
President Barack Obama praised JP Morgan Chase in an interview recorded Monday as "one of the best managed banks there is" and its CEO, Jamie Dimon, as "one of the smartest bankers we got." On Tuesday, the White House made public financial disclosure forms showing the president and First Lady Michelle Obama had between $500,001 and $1,000,000 in a "JP Morgan Chase Private Client Asset Management Checking Account."
The annual peek into the Obamas' finances showed that the president held between $1,000,001 and $5,000,000 in U.S. Treasury Notes, generating between $5,001 and $15,000 in interest. They also held between $500,001-$1,000,000 in Treasury Bills.
Crony Capitalism: After Lobbying Against New Financial Laws, JPMorgan Loses $2B in Risky Bet
JPMorgan Chase, the nation's largest bank, is under fire after losing at least $2 billion in derivatives trading it was warned carried high risk. The loss has renewed calls for tougher regulation of Wall Street, with critics saying JPMorgan could have avoided it under regulations the bank opposed. We're joined by former financial regulator, white collar criminologist, and University of Missouri-Kansas City Professor William Black, author of "The Best Way to Rob a Bank is to Own One." Black says JPMorgan's latest woes stem from the flaws endemic to "too big too fail." "Allowing [banks] to be this big, even conservative economists call this 'crony capitalism,'" Black says. "The only way this can work is to shrink the systemically dangerous institutions -- the 20 largest banks in the United States -- down to the point that they no longer pose a systemic risk. [When] they are no longer too big to fail, they will no longer have this implicit federal subsidy that completely distorts competition [and] ... destroys democracy because these giant institutions have so much political power."
Regulators Snooze While JPMorgan Lights the Fuse
By Jonathan Weil - Bloomberg.com
Don't worry your pretty little heads, JPMorgan (JPM) Chase & Co. Chief Financial Officer Douglas Braunstein seemed to assure listeners on the bank's quarterly earnings conference call last month. Regulators knew everything JPMorgan's chief investment office was doing, he said.
"We are very comfortable with our positions as they are held today, and I would add that all of those positions are fully transparent to the regulators," Braunstein said April 13. "They review them, have access to them at any point in time," and "get the information on those positions on a regular and recurring basis as part of our normalized reporting."
Dimon didn't practice what he preached at Harvard He warned of self-deception, and proved his point
By Al Lewis
DENVER (MarketWatch) — Here's a handy leadership tip from J.P. Morgan Chase CEO James Dimon: "You have to fight self-deception. Human beings are experts at it. I do it, too."
I found this advice on J.P. Morgan's website. It is from a June 2009 talk Dimon gave to Harvard Business School graduates on leadership qualities.
Here's the basic lesson: If you employ some guy placing billions of dollars in risky trades, and that guy has been nicknamed "The London Whale," you should not pretend rising concerns about his trading positions are "a tempest in a teapot."
Dimon is now under fire for more than $2 billion in surprise losses on credit-derivative bets that have yet to be fully explained. Some of Dimon's highly compensated executives are now stepping down because of the whale they could no longer fit in the proverbial teapot.
The Lack of Accountability
that Allowed JPMorgan to Gamble Billions
By Kurt Cobb - OilPrice.com
If I were to stake you $50,000 and set you loose in the world's largest casino, you might try your luck in a big way at a number of games to see if you could double or maybe even triple your good fortune. But it would be an entirely different matter if the $50,000 were your own money. You might decide to take advantage of the casino's restaurant for which you would at least get a meal in return for your money. And, you might even test your skills with a few hundred dollars. But unless you were a gambling addict, you would be on your way pretty soon after the house had taken the few hundred dollars you decided you could afford to lose.
Accidentally Released - and Incredibly Embarrassing -
Documents Show How Goldman et al
Engaged in 'Naked Short Selling'
by Matt Taibbi - RollingStone.com
It doesn't happen often, but sometimes God smiles on us. Last week, he smiled on investigative reporters everywhere, when the lawyers for Goldman, Sachs slipped on one whopper of a legal banana peel, inadvertently delivering some of the bank's darker secrets into the hands of the public.
The lawyers for Goldman and Bank of America/Merrill Lynch have been involved in a legal battle for some time – primarily with the retail giant Overstock.com, but also with Rolling Stone, the Economist, Bloomberg, and the New York Times. The banks have been fighting us to keep sealed certain documents that surfaced in the discovery process of an ultimately unsuccessful lawsuit filed by Overstock against the banks.
Time Is Running Out for Treasury Market Rally:
Pimco's Gross
By: Ansuya Harjani - CNBC.com
The time where investors are no longer willing to accept negative yields on U.S. Treasurys is near, warned Bill Gross, manager of Pimco, the world's largest bond fund.
"With the U.S. suffering a credit downgrade to AA+ and offering negative 200 basis point policy rates for the privilege of investing in Treasury bills, the willingness of creditors — as opposed to debtors — to support the existing system may soon fade," Gross wrote in a Financial Times editorial published on Tuesday.
California, the ninth largest economy in the world,
resorts to austerity California, America's 'golden state', is slashing spending to avoid a Greek-style default
By GUY ADAMS - Independent.co.uk
Taking a deep breath, California's most powerful man strode to a lectern and unveiled the fiscal policy that he hopes will keep America's most populous state from falling into bankruptcy.
"You name it," he declared, "and we've got to cut it!"
Underwater Recession
JOY A. BUCHANAN, STEVEN GJERSTAD,
& VERNON L. SMITH - The American Interest
The U.S. economy is stuck in a painfully slow recovery. Neither accommodative monetary policy nor fiscal stimulus has done the trick in generating robust growth, and no one seems to really have a grasp on why. We propose an explanation for why they have not been working, and on that basis we will explicate a feasible path to renewed robust growth.
Young Americans delay purchase of homes
By Anjli Raval in New York - FT.com
Andrea Stautberg, 27, and her husband James wanted to buy a house after finishing graduate school in 2009. But in the face of a tough economic climate, uncertain job prospects and $115,000 in student loan payments, the couple instead decided to save money by living with James's parents in Texas.
They stayed for more than a year – longer than the three months they had planned – before deciding to rent a flat.
"We are looking to buy a house, but have yet to get pre-approved," said Ms Stautberg. "We lived with his parents for as long as we did to pay back our student loans and still save for a down payment."
Obamacare's Patient-Dumping, Privacy-Meddling Scheme
By Michelle Malkin - PatriotPost.us
The stench of Chicago cronyism over the White House just got fouler. Inhale this:
A shadowy $10 billion Obamacare agency with zero oversight just awarded first lady Michelle Obama's pet patient-dumping scheme at the University of Chicago Medical Center a $5.9 million taxpayer-funded grant. It will enable Mrs. Obama's cronies to build a government-sponsored electronic medical record-sharing system.
The Chicago program, known as the Urban Health Initiative, is run by one of President Obama's closest golfing buddies, scandal magnet Eric Whitaker, who has been entangled with Illinois corruption celebrities Rod Blagojevich and Tony Rezko over the past decade.
That Which Is Unsustainable Will Go Away: Medicare
BY CHARLES HUGH SMITH - FinancialSense.com
Here are the sobering facts about the number of workers and those drawing Social Security, Medicare and Medicaid entitlements in the U.S. While the government claims to have a "trust fund" to pay for Social Security and Medicare, this is illusory propaganda. There are no funds set aside to pay these entitlements--they are "pay as you go" programs funded by current tax revenues. If the tax revenues don't cover the programs' expenses, the Treasury sells bonds, i.e. issues debt to pay the entitlements.
Social Security (SSA) has 61 million beneficiaries as of March 2012.
Medicare has 49 million beneficiaries as of November 2011.
Judge Blocks Portion of NDAA
Truthdig.com
A federal judge Wednesday issued an injunction against a National Defense Authorization Act provision that grants the military the right to detain anyone it suspects of involvement in terrorism. U.S. District Judge Katherine Forrest ruled in favor of a group of plaintiffs, including Truthdig columnist Chris Hedges, who filed a lawsuit against the legislation within weeks of President Obama signing it.
Hedges was joined in the suit by linguist, author and dissident Noam Chomsky, Pentagon whistle-blower Daniel Ellsberg and other high-profile activists, scholars and politicians.
Judge Napolitano: First Patriot To Shoot Down
A Government Spy Drone Will Be A Hero Blasts illegal use of "plastic drones"
to spy on Americans in their backyards
By Steve Watson - Infowars.com
Judge Andrew Napolitano has warned Congress not to act "like potted plants" regarding the increased use of unmanned surveillance drones without warrants over US skies by military, government, and law enforcement agencies.
Echoing the recent comments of his Fox News colleague Charles Krauthammer, Napolitano also said that "The first American patriot that shoots down one of these drones that comes too close to his children in his backyard will be an American hero."
Mobile Wallet Technology:
The New Barbarians are at the Gate
BY SHAH GILANI, Capital Waves Strategist, Money Morning
As I discussed in Part One, the sky is the limit when it comes to mobile wallet technology.
The big brand credit card issuers: American Express, MasterCard, Visa, and Discover Card, along with every other card issuer and wannabe credit extension intermediary are all already into the mobile wallet space.
Their offerings vary and competition between them will be as brutal as it always has been. And that's good for consumers.
Creating choices for consumers to drive business will lead to more innovation and more services offered at more competitive prices. At least, that's the way the free market is supposed to work.
Facebook IPO: Insiders Cashing Out
[Google 'title' for free article pass]
By LYNN COWAN And MIA LAMAR - $$
Facebook Inc. on Wednesday boosted the size of its initial public offering by as much as $3 billion, as some major stockholders sharply increased the number of shares they intend to sell as part of the IPO.
In an updated filing, Facebook increased the number of shares it will offer in the IPO to 421.2 million from 337.4 million. The additional shares—which would be worth $3.2 billion at the high end of current price range—come from venture capitalists and early investors looking to cash out a greater number of their shares. The company itself isn't selling any additional shares.
Google Gets Back to Its Roots With New Search Update
By Alexis Madrigal - TheAtlantic.com
Your Google search experience is about to change.
No, don't worry, it's not another social integration. The latest update has nothing to do with Facebook and everything to do with Google's core strengths of organizing information so that you can find it faster.
Now, when you search certain things, say, Tom Cruise, a box will pop up in the right column of your search with structured data about the topic. Google can identify 500 million people, places, and things and can serve up a custom selection of data based on the nature of the noun.
Patagonia's Founder Is America's Most Unlikely Business Guru For years, Yvon Chouinard kept his eco-conscious, employee-friendly practices largely to himself. Now mega corporations like Walmart, Levi Straus and Nike are following his lead.
By SETH STEVENSON - WSJ Magazine
A couple of years ago, Yvon Chouinard—founder of the outdoor-clothing brand Patagonia—gave a talk at a sustainable-fisheries conference in Vancouver. He'd been invited to speak in recognition of Patagonia's longtime commitment to environmental issues and its reputation as a company that manages to churn out profit while minimizing ecological impact. Chouinard delivered his spiel, but he came away frustrated by the surprising ignorance of his audience. "They didn't know what they were doing," he says of the seafood merchants. "They had no idea about toxins, about incidental catch. Their customers are all going to want to know this stuff soon. Restaurants will want to know."
Why Wrigley Field Must Be Destroyed
By RICH COHEN - WSJ.com
Having not won a World Series since 1908, and having last appeared on that stage in 1945—a war year in which the professional leagues were still populated by has-beens and freaks—the Chicago Cubs must contemplate the only solution that might restore the team to glory: Tear down Wrigley Field.
Destroy it. Annihilate it. Collapse it with the sort of charges that put the Sands Hotel out of its misery in Vegas. Implosion or explosion, get rid of it. That pile of quaintness has to go. Not merely the structure, but the ground on which it stands.
The Bank Runs In Greece
Will Soon Be Followed By Bank Runs
In Most Of The Rest Of Europe
By Michael Snyder - TheEconomicCollapseBlog.com
The bank runs that we are watching right now in Greece are shocking, but they are only just the beginning. Since May 6th, nearly one billion dollars has been withdrawn from Greek banks. For a small nation like Greece, that is an absolutely catastrophic number. At this point, the entire Greek banking system is in danger of collapsing. If you had money in a Greek bank, why wouldn't you pull it out? If Greece leaves the euro, all euros in Greek banks will likely be converted to drachmas, and the value of those drachmas will almost certainly decline dramatically. In fact, it has been estimated that Greek citizens could see the value of their bank accounts decline by up to 50 percent if Greece leaves the euro. So if you had money in a Greek bank, it would only make sense to withdraw it and move it to another country as quickly as possible. And as the eurozone begins to unravel, this is a scenario that we are going to see play out in country after country. As member nations leave the eurozone, you would be a fool to have your euros in Italian banks or Spanish banks when you could have them in German banks instead. So the bank runs that are happening in Greece right now are only a preview of things to come. Before this crisis is over we are going to see bank runs happening all over Europe.
Greek Depositors Withdrew $898 Million From Banks Monday
[Google 'title' for free article pass]
By NEKTARIA STAMOULI - WSJ.com $$
ATHENS—Greek depositors withdrew €700 million ($898 million) from local banks Monday, the country's president said, as he warned that the situation facing Greece's lenders was very difficult.
In a transcript of remarks by President Karolos Papoulias to Greek political leaders that was released Tuesday, Mr. Papoulias said that withdrawals plus buy orders received by Greek banks for German bunds totalled some 800 million.
Citing a conversation he had with Greek Central Bank Governor George Provopoulos, Mr. Papoulias said "that the strength of banks is very weak right now."
Greek President Told Banks Anxious as Deposits Pulled
By Natalie Weeks and Maria Petrakis - Bloomberg.com
Greek President Karolos Papoulias was told by the central bank chief this week that financial institutions are becoming anxious about their prospects as Greeks pull out cash after inconclusive May 6 elections.
"Provopoulos told me that of course there's no panic but there's great fear which can evolve into panic," according to a transcript of the president's meeting with party leaders on May 14 that was published yesterday. Central bank head George Provopoulos told Papoulias that Greeks have withdrawn as much as 700 million euros ($893 million) and the situation could worsen, according to the transcript.
Greece Weighs $562 Million Default or Yield Choice
By John Glover - Bloomberg.com
Greece, which hasn't had a government for more than a week and whose 10-year debt yields more than 27 percent, decides today whether to pay 436 million euros ($562 million) to bondholders who shunned last month's debt swap.
A floating-rate note sold a decade ago by Europe's most- indebted nation matures today. Repaying the security would disadvantage investors who took losses in the bond exchange and voters facing spending cuts. Reneging on the obligation also would constitute a default, triggering derivatives contracts and clauses requiring the settlement of other unswapped bonds. Meantime, the country has no government to make the choice.
Merkel tells Greece to back cuts or face euro exit Greece may be forced to leave the euro if the country refuses to implement spending cuts agreed with the European Union, Angela Merkel warned.
By Robert Winnett, David Blair
and Bruno Waterfield - Telegraph.co.uk
Raising the spectre of a Greek exit, the German chancellor said "solidarity for the euro" was threatened by the ongoing political crisis in Athens.
Stock markets around the world fell sharply with fears mounting that a euro break-up could lead to renewed financial turmoil. The FTSE-100 index of Britain's major companies fell by two per cent to 5465, with bank shares hit particularly hard.
The cost of Spanish government borrowing also hit a record high since the single currency was introduced because of concerns that the crisis will spread.
Europe Must Face Ugly Reality of Greek Exit from Euro
By the Editors - Bloomberg.com
A Greek exit from the euro area has the potential to be the European Union's most economically and politically destructive event of a generation. Unfortunately, Europe has reached the point where it must prepare for such an outcome.
Whether Greeks want it or not, circumstances could soon force their country to return to the drachma. Europe's leaders, as Luxembourg Prime Minister Jean-Claude Juncker hinted, might extend Greece's deadlines to meet the budget targets required for rescue money, but they won't provide emergency financing to a government that refuses austerity measures. Without Europe's help, Greece's government (whoever ends up leading it) faces a dilemma: Cut spending even more than under the austerity program, or default on its debts and print a new currency to pay its bills.
Little country threatens big impact
By Peter Spiegel in Brussels and Quentin Peel in Berlin - FT.com
For more than 20 years, Jean-Claude Piris was one of the most powerful men in Brussels, a top EU lawyer who almost singlehandedly authored the series of international treaties that took a loosely affiliated community of 12 to a quasi-political union of 27, complete with its own currency.
So when Mr Piris retired last year and published a book arguing the EU had grown too large too quickly, it set off a firestorm among the euorocracy. "To blame us for the imprudent lending within the eurozone, we just find that offensive nonsense," said a senior minister from a newer, central European member state.
Europe's Achilles heel
Amid growing risk of a Greek exit, the euro zone has yet to face up to the task of saving the single currency itself
Economist.com
THE respite in the euro crisis lasted a few short months. Now, despite a €130 billion ($169 billion) second bail-out for Greece, a fiscal compact agreed on by the euro-zone leaders in December, and €1 trillion of cheap long-term loans from the European Central Bank, the night terrors are back. How dispiriting that Europe is still so ill-prepared for the ordeal to come.
If Greece Quits Euro, Its Ruin Will Be Pointless
By Clive Crook - Bloomberg.com
The chaos in Greece has resumed and a new election that nobody expects to resolve anything looms. Exasperated European Union officials have begun openly discussing the country's exit from the euro currency system. This is a grave mistake. Greece's exit would be no less catastrophic than when the EU called it unthinkable -- and not just for Greece.
"Divorce is never smooth," Luc Coene, the governor of Belgium's central bank and a member of the European Central Bank's governing council, told the Financial Times on May 13. "I guess an amicable divorce -- if that was ever needed -- would be possible but I would still regret it."
Italy's banks shaken as economic slump deepens As Greece erupts, Italy is moving into the eye of the storm. Its economy is contracting at speeds not seen since the depths of the slump in 2009 as draconian austerity bites, greatly increasing the risk of social revolt and a banking crisis.
By Ambrose Evans-Pritchard - Telegraph.co.uk
With the world's third largest debt after the US and Japan at €1.9 trillion (£1.18 trillion), it is big enough to bring the global financial system to its knees. It is also in the front line of contagion as the Greek crisis metastasizes.
Yields on 10-year Italian debt jumped 16 points to 5.86pc on Tuesday after Italy's data agency said the country is sliding even into deeper recession, with GDP shrinking 0.8pc in the first quarter.
5000 METRIC TONS GONE
FROM WEST TO EAST SINCE FEB 29TH RAID "Western Banks Being 'Cleaned Out' of Physical Gold On Price Weakness; 5000+ tonnes"
By Jim Willie - Implode-Explode.com
After a seeming tough messy but productive week in the gold trading trench warfare, my reliable gold trader source offered a summary with more expressed satisfaction than ever conveyed in all the years we have been in contact. It is not completely over as a war, but the Battle of the Bulge and Battle of Midway seem concluded, each a major victory. This message is of chest pounding with a foot atop a dead victim. Thegold price is surely depressed, but the gold cartel is reportedly mortally wounded. The path upward might be cleared to the point of ending this latest round of price suppression. The Good Guys have finished a mission for this round. The gold trader has a keen knowledge of WW2 and hardened experience of Russia. He wrote, "This is great. The market is cleaned out when it comes to physical. The purchases to drain the cartel are 1000 MT [metric tons] per shot/transaction. The Boyz are illiquid and have to sell at budget bargain prices.
What Will Happen to Greece and Gold?
By: Julian D. W. Phillips - GoldSeek.com
What Greek Elections Now Mean
Greece cannot form a government so expect elections within a month. We have come to the point where the bad news is out –the markets are telling us that Greece will likely leave the Eurozone and possibly the euro as their 10-year debt continues to trade at 27%. They may not pay out €436 million to creditors and keep it, fearing they will not get the next bailout tranche. Reneging on the obligation also would constitute a default triggering derivatives contracts and clauses requiring the settlement of other un-swapped bonds. Meantime the country has no government to make the choice. The country may run out of money by early July. The standoff has reignited concern that Greece will renege on pledges to cut spending as required by the terms of its two bailouts negotiated since May 2010.
Gold Daily and Silver Weekly Charts -
More Liquidation on Greece and Facebook
JESSE'S CAFÉ AMÉRICAIN
More concern on Greece and what will happen if it leaves the Euro had traders fleeing risk and commodities including gold and silver.
There is also quite a bit of secondary liquidation being done as traders raise cash for 'the Big Flip' when Facebook comes out after the bell on Thursday.
Expectations are for the stock to price in the 30's, and then run up in the secondary market into the 60's at which point those who had the IPO can liquidate if the momentum traders provide liquidity and institutions and mom and pop pick up the slack.
Is Fear of Deflation Sapping Gold and Silver?
Rick Ackerman - SilverSeek.com
There's no point in pretending it's those sleazy, child-molesting bullion bankers at Morgan Stanley, Goldman Sachs and J.P. Morgan who have been pounding on mining stocks and bullion futures in the last few months. Lately, it has felt like the whole world has been dumping them. For the record, we are ourselves cautious buyers of bullion futures and select mining stocks at these levels, since many popular trading and investment vehicles that we track are closing on important Hidden Pivot correction targets. (Want to find out the exact prices at which were are doing the buying?
Group of Eight set to meet;
France's Francois Hollande to first visit Obama
By David Nakamura and Howard Schneider - WashingtonPost.com
Leaders of the world's eight richest economies are set to gather at Camp David this weekend amid questions about Europe's spiraling debt crisis.
But before they do, one key player, French President Francois Hollande, will stop by the White House to introduce himself to President Obama.
America's G-Zero Moment
By Ian Bremmer - Project-Syndicate.org
NEW YORK – The 2008 financial crisis marked the end of the global order as we knew it. In advance of the upcoming G-8 summit, it is impossible to overlook the fact that, for the first time in seven decades, the United States cannot drive the international agenda or provide global leadership on all of today's most pressing problems.
Indeed, the US has trimmed its presence abroad by refusing to contribute to a eurozone bailout, intervene in Syria, or use force to contain Iran's nuclear breakout (despite strong Israeli support). President Barack Obama officially ended the war in Iraq, and is withdrawing US troops from Afghanistan at a pace constrained only by the need to save face. America is handing off the leadership baton – even if no other country or group of countries is willing or able to grasp it.
A promising EU offer Obama refuses to accept
By C. Boyden Gray - WashingtonTimes.com
The European Union has endured decades of criticism for its overregulating and "under-risk-taking." Finally, responding to its frustrated business community and backed by every single member state, the EU is looking to regulatory reform to foster desperately needed economic growth. A central reform is the proposed EU-U.S. Free Trade Agreement. But amazingly, the Obama White House refuses, for no articulated reason, to embrace the deal.
* * * * *
Lindsey Williams on JP Morgan $2 billion loss May 2012
5 US Banks have $292 TRILLION exposure in derivatives markets; JPM is a crack in market and tip of the ice berg -- then currency wars -- then trade wars -- then rise interest rates and 'paper' becomes worthless. World wide financial collapse is now inevitable. Pension funds are in dire jeopardy. Lindsey's new DVD (May 8th) - "Tactics of the Elite" - 785-266-1112
Systemic Risk Is Everywhere
By Greg Hunter's USAWatchdog.com
The $2 billion loss of JP Morgan in derivatives trading is signaling, once again, the enormous risks big banks take with taxpayer backing. All U.S. banks are covered by the FDIC, and if a loss is big enough, it could threaten the financial system just as it did in 2008. JP Morgan has $70 trillion in total derivative exposure. The entire world has a little more than $700 trillion in derivative exposure, and one bank has 10% of all the derivative exposure on the planet! If JP Morgan gets into trouble, it alone could cause systemic failure. Today, the FBI announced an investigation into the surprise $2 billion (or more) trading loss that happened last week at the bank. Reuters reported, "The probe was seen in some quarters as necessary, given the ongoing debate in Washington about bank regulation and reform, and one expert said it raised the level of concern around what happened. 'The FBI looks for evidence of crimes and goes after people who it alleges are criminals. They want to send people to jail. The SEC pursues all sorts of wrongdoing, imposes fines and is half as scary as the FBI,' said Erik Gordon, a professor in the law and business schools at the University of Michigan."
Keiser Report: Countdown to Armageddon (E288)
In this episode, Max Keiser and co-host, Stacy Herbert have a field day dissecting Jamie Dimon's 'egregious, terrible mistake,' the possible insider trading around those so-called mistake and what the Leveson Inquiry may tell us about the SEC's Mary Schapiro's 'focus' on these oh so egregious mistakes. In the second half of the show Max talks to Nomi Prins, a former senior executive at Goldman Sachs and Bear Stearns, about the problems at JP Morgan's London trading desk.
Bill Black: On JP Morgan's "Hedge", Jamie Dimon's Integrity, and the Epic Conflicts of Interest in the Federal Reserve System
CapitalismWithoutFailure.com
The story that JP Morgan is telling us: They had about $15 billion in distressed European debt. Europe has been in trouble, so those investments were losing value. Their story, which does not make sense, is that they decided to hedge this position with a derivative of a derivative. In this case, it was an index of credit default swaps, which is the form of derivative that blew up AIG. JP Morgan's story is that instead of offsetting the risk, the hedge increased the losses dramatically. They woke up one morning, and they had a $2 billion loss.
Why it does not make sense: If you have distressed European debt, you are supposed to have already reserved against the losses in it. So why hedge the position at all? Just sell it. Get rid of these incredibly risky assets before they can suffer any additional losses. If you already have losses, it is not necessary to recognize a loss, because you have already reserved for it. So, you should not have had to hedge, period.
JPMorgan's Busted Bet Was No Chance Encounter
BY SHAH GILANI, Capital Waves Strategist, Money Morning
This weekend I was strolling by JPMorgan Chase's (NYSE: JPM) Park Avenue office building in Manhattan.
It was 11:40 am, and I was returning from a long walk from my midtown hotel down to Chelsea (it was definitely "a Chelsea morning" in NYC... thank you Joni Mitchell).
I hadn't planned to walk by their office building; I didn't even know where it was.
But there I was, rounding 48th Street on Park Avenue, when I saw the JPM sign. I thought, how ironic, I'm in New York, appearing on FOX News to talk about the debacle at JPM, and here I am serendipitously walking by their office building.
But it gets even better.
J.P. Morgan Moves to Protect Dimon
[Google 'title' for free article pass]
By DAN FITZPATRICK And JOANN S. LUBLIN - WSJ.com $$
J.P. Morgan Chase closed ranks around Chief Executive James Dimon ahead of a shareholder meeting and announced the departure of a senior executive at the center of a trading blunder that has cost the bank more than $2 billion in losses.
President Barack Obama, meanwhile, on Monday used the losses to argue for stricter Wall Street regulation. At a taping of ABC's "The View," according to excerpts released by the network, he said: "This is one of the best managed banks. You could have a bank that isn't as strong…and we might have had to step in. That's why Wall Street reform is so important." Mr. Obama praised Mr. Dimon as "one of the smartest bankers we got," adding: "and they still lost $2 billion and counting."
The following interview explains derivatives market losses in Europe (it's not about debt); banks are not done bleeding the public, yet. Bigger bets all along the way. Fed collusion with ECB and next move to Asia. Derivatives market exposure was $707 TRILLION as of last December. (December 2011) JPM has approximately 11% of global derivatives.
Nomi Prins 1/2 $7.7 Trillion FED Bailout:
US Mega-Bank Derivatives
Alex talks with author and journalist Nomi Prins. She is a former managing director of Goldman Sachs and a Bears Stearns analyst. On December 1, she wrote for Infowars.com about the Federal Reserve's continuation of bailout economics and protecting US mega-banks from losses incurred by European banks through derivatives. Prins is the author of It Takes a Pillage: Behind the Bonuses, Bailouts, and Backroom Deals from Washington to Wall Street.
Timothy Geithner: JPMorgan 'case for reform'
By MJ LEE | Politico.com
Treasury Secretary Timothy Geithner on Tuesday weighed in on JP Morgan's $2 billion loss, saying that the bank's risky hedging makes a "very powerful case" for financial reform.
"This failure of risk management is just a very powerful case for reform, for financial reform — reforms we still have ahead and the reforms we've already put in place," Geithner said. "The test to reform is not whether you can prevent banks from making mistakes errors of judgment or risk management. That's going to happen, it's inevitable. The test of reform should be — do those mistakes put at risk the broader economy, financial system, or the taxpayer?"
Why JPMorgan gets away with bad bets
By William K. Black, Special to CNN
(CNN) -- JPMorgan Chase can be considered a systemically dangerous institution, which means that it is "too big to fail" because the government fears that its collapse would cause a global financial crisis.
It is simply irrational to allow such an institution to exist, especially when it can easily incur a $2 billion trading loss.
Banks are more efficient when shrunk to the point that they can no longer endanger the world economy. But because JPMorgan and similar banks are the leading contributors to Democrats and Republicans, neither political party has the courage to order them to reform.
Why We're All J.P. Morgan Now The entire world of investing, including your 401(k), is now being run just like J.P. Morgan's "synthetic credit portfolio."
By BRETT ARENDS - SmartMoney.com
The drama unfolding at J.P. Morgan Chase is stunning.
Gripping.
And oh so predictable.
If you think this is just a story about Wall Street greed and folly, and has nothing to do with you, think again. We are all J.P. Morgan now.
To recap: The bank just lost $2 billion in something called its "synthetic credit portfolio" by taking big bets on European bonds. The trader involved, Bruno Iksil, was known as "the London Whale" and "Lord Voldemort" for his big trades. Heads are now rolling. CEO Jamie Dimon is under pressure.
FBI probes JPMorgan, shareholders back Dimon
By David Henry
(Reuters) - The FBI has opened an inquiry into the multibillion-dollar trading losses at JPMorgan Chase, stepping up pressure on the bank after key U.S. agencies said they were looking into high-risk trades that first drew regulators' attention last month.
The news did little to spook investors, who sent the stock higher Tuesday, or shareholders, who backed embattled Chief Executive Jamie Dimon at the bank's annual shareholders meeting, with a vote rejecting a proposal to split the jobs of CEO and chairman.
JPMorgan's Dimon gets his $23 million pay package
By Charles Riley @CNNMoney
NEW YORK (CNNMoney) -- Even as he apologized for a $2 billion trading loss, shareholders approved JPMorgan Chase CEO Jamie Dimon's $23 million pay package Tuesday at the bank's annual meeting.
The meeting comes just days after the bank disclosed the massive trading loss, an event that led to the departure of its chief investment officer and forced its CEO to repeatedly apologize for the bank's actions.
The "Corzine-Dimon Syndrome"
By Eric Fry - DailyReckoning.com
05/15/12 Laguna Beach, California – On its best days, the American judicial process is a blindfolded Lady Justice — prosecuting the truly guilty and exonerating the truly innocent. On its worst days, it is a Water Wiggle — whirling around unpredictably, without any apparent connection to guilt, innocence, Constitutionality or the proportionality of alleged crimes to one another.
On good days, guilty parties go to prison; innocent parties do not. On very good days, innocent parties do not even have to go to the trouble of hiring a lawyer and showing up in court. Law enforcement agencies correctly decide to spare them the burden (and potential agony) of proving their innocence before a judge or jury.
Boehner says won't hike debt ceiling without cuts
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) — Speaker of the House John Boehner said Tuesday he will not allow another increase of the debt ceiling without offsetting spending cuts.
"We shouldn't dread the debt limit. We should welcome it. It's an action-forcing event in a town that has become infamous for inaction," Boehner said in a speech to the Peter G. Peterson Foundation.
Geithner warns Boehner not to play
with next deal to increase the debt ceiling
By Erik Wasson - TheHill.com
Treasury Secretary Timothy Geithner on Tuesday warned Speaker John Boehner (R-Ohio) against playing with the U.S. debt ceiling.
"This commitment to meet the obligations of the nation, this commitment to protect the creditworthiness of the country, is a fundamental commitment that you can never call into question or violate," Geithner said Tuesday in an address to the Peterson Foundation.
Meet the Man Who Controls More Money than Ben Bernanke
BY DAN COLLINS - FinancialSense.com
If you thought the U.S., E.U., and Japan were the only central banks printing fiat currency think again. There is new player at the table and he controls more money than Ben Bernanke.
The People's bank of China (PBoC), China's central bank is now the 800lb panda in terms of balance sheets. They have become the main provider of global liquidity with its total assets topping 28 trillion yuan (about $4.5 trillion dollars). By comparison, the Federal Reserve's balance sheet is a paltry $3.5 trillion dollars.
SEC Trade Halts, Best Buy Departure, Compliance
By Carla Main - Bloomberg.com
The U.S. Securities and Exchange Commission halted trading in 379 shell companies over concern that fraudsters could hijack stocks to steal investor money.
The trading suspensions, the most by the SEC in a single day, stem from the work of an agency task force that identified clearly dormant microcap stocks in 32 states and at least six countries, the SEC said yesterday in a statement.
Microcap shares have long been used for frauds such as pump-and-dump schemes.
Inflation decelerating, but Fed won't pull trigger
Core inflation still heating up, limiting Fed flexibility
WASHINGTON (MarketWatch) — Inflationary pressures are fading, just as Federal Reserve officials expected. But don't think that the decline in the inflation rate will automatically lead to further quantitative easing by the Fed.
The consumer price index was flat in April, the Bureau of Labor Statistics reported Tuesday. And the CPI is expected to drop by at least 0.2% in May on account of the big drop in gasoline prices.
GOP plans fast track for tax overhaul
By Russell Berman and Bernie Becker - TheHill.com
Speaker John Boehner said in a speech Tuesday that House Republicans would try to attach a timeline to fast-track a broad tax overhaul to a vote extending the George W. Bush-era tax rates before the November elections.
The effort is part of a bid by the Speaker to get started early — and out in front of Democrats — on a raft of year-end tax and spending provisions that could await congressional action in a lame-duck session.
The Elite Believe That You Are Ruining Their Planet
And They Want You To Stop Reproducing
By Michael Snyder - EndOfTheAmericanDream.com
Today, there are more than 7 billion people living on earth. For the global elite, that is problem number one. The vast majority of us don't spend much time thinking about global population issues, but for many among the elite it is an absolute obsession. Many of them truly believe that you are ruining their planet and they desperately want you to stop reproducing so much. Among the elite, the belief that the world is grossly overpopulated and that this is causing most of our major global problems crosses all political, cultural and social boundaries. This philosophy is taught as gospel at the vast majority of all colleges and universities on the planet, and it is being relentlessly pushed by the United Nations, the WHO, the World Bank and national governments all over the globe. When most people think of "overpopulation", they think of places such as India, but the truth is that those of us living in America are considered to be the worst offenders because our lifestyles are "polluting" the planet so rapidly. In fact, one scientist recently estimated that a child born in the United States has a "carbon legacy" 55 times greater than a child born in India. The elite are convinced that if they can reduce the global population far enough and get the remaining people living on earth to switch over to "sustainable lifestyles" that they will be able to save "their" planet. But the draconian measures that would be necessary to achieve this dystopian dream would not be very palatable to the vast majority of us. In fact, if the most radical population control advocates get their way, we will experience global tyranny on a scale never seen before.
Coast To Coast AM - 5-12-2012 -
Stan Deyo & Steve Quayle - Earth Changes
May 12th, 2012 edition of Coast To Coast AM, John B. Wells sits down with author and researcher, Steve Quayle, along with former undercover FBI agent, Stan Deyo, for a discussion and dissection regarding everything coming at us. End game is to REDUCE the population of the planet... Operation Mountain Lion: pounce, compress & destroy.
Why Older Americans
Have the Worst Long-Term Unemployment Crisis
By Derek Thompson - TheAtlantic.com
We have, on this site, focused like a laser beam on the job crisis for the young. But today, a compelling report from the GAO reminds us that among those who have lost a job, older Americans might just have it worse.
Actually, they absolutely have it worse. Americans over the age of 55 are the least likely to find another job and the most likely to take a significant pay cut for the next position.
Senate to vote on Ryan Medicare plan
By Sam Baker and Elise Viebeck - TheHill.com
The Senate is scheduled to vote Wednesday on Rep. Paul Ryan's (R-Wis.) budget plan, giving Democrats another chance to put their GOP counterparts on the record supporting Ryan's controversial Medicare proposal.
Senators will devote six hours to the budget debate Wednesday and vote on four Republican proposals — including Ryan's. His plan, which passed the House on a party-line vote in March, would partially privatize Medicare. Some of the program's federal funding would be converted into subsidies that seniors would use to buy private insurance.
Avoid Retirement Health-Care Mistakes The typical health-care tab will run $240,000,
but could run much higher.
By ANDREA COOMBES - SmartMoney.com
Retirement health-care costs are enough to cause a severe anxiety attack. Even with Medicare benefits, a 65-year-old couple retiring in 2012 will spend at least $240,000 in retirement, according to the latest estimate from Fidelity Investments.
That doesn't include long-term-care costs, over-the-counter medications and most dental costs.
Plus, that $240,000 estimate is based on average life expectancy for a 65-year-old -- the husband living until age 82 and the wife until 85 -- but "average" means half of people live longer than that.
In other words, that 65-year-old couple may well need much more than $240,000.
GM to stop advertising on Facebook
By Peter Valdes-Dapena @PeterDrives
NEW YORK (CNNMoney) -- General Motors said Tuesday that it will stop paid advertising on Facebook.
The automaker says it will still be on the social networking site, it just won't be spending money to buy ads.
"We regularly review our overall media spend and make adjustments as needed," GM said in a statement. "This happens as a regular course of business and it's not unusual for us to move things around various media outlets."
What Facebook's IPO and Treasurys Have in Common
By Jack Hough - SmartMoney.com
Facebook's forthcoming stock offering and United States Treasury notes would seem to occupy opposite ends of the risk-reward spectrum of investments. But the two share similarities.
The 10-year Treasury recently yielded 1.79%, not far from its historic low yield of 1.67% reached in September. Bond yields move opposite prices, so as buyers become more eager, yields fall. Since 1962, 10-year Treasurys carried an average yield of 6.7%.
Santelli Explains Why A Broke California
"Likes" A Hot Facebook IPO
Submitted by Tyler Durden - ZeroHedge.com
The unsurprising and yet depressingly real budget data from California today should shock no-one and CNBC's Rick Santelli provides the most succinct and even more saddening reality check on the situation this morning as he points out the $15.7 billion shortfall and how cuts and compromise will fill that gap. His sane response to the implicit rise in taxation that this compromise realistically requires will mean - happy feet as Californians leave the state. His rant is one of the best but a little later in the day, the problem appears to be on its way to being fixed by none other than the hoody-in-chief himself. According to Bloomberg, Facebook Inc.'s initial public offering likely will account for 20 percent of California's personal income growth this calendar year, the state fiscal analyst said.
New Video Surveillance Technology
Spots Crime Before it Happens
BY MICHAEL A. ROBINSON, Defense and Technology Specialist,
Money Morning
Falling statistics aside, crime is still a national epidemic.
The truth is 1.2 million of us will fall victim to a rape, robbery or murder by the end of this year.
That adds up to 3,400 new crime victims each and every day--all year long.
Yet the odds are growing daily that video cameras will catch these ultra-violent thugs in the act.
The fact is the U.S. has roughly 30 million cameras watching banks, malls, factories and city streets manned by law enforcement, federal agents, the military, homeowners and private security.
Pentagon to address F-22 pilots' oxygen fears
By Kristina Wong-The Washington Times
Defense Secretary Defense Leon E. Panetta on Tuesday directed the Air Force to take measures addressing pilots' concerns about the F-22Raptor fighter jet's oxygen system.
First, the Air Force will install an automatic backup oxygen system in all of its F-22 fighters.
Second, all F-22 flights will remain close enough to potential landing locations to allow for quick recovery and landing, if needed.
Syrian rebels get influx of arms
with gulf neighbors' money, U.S. coordination
By Karen DeYoung and Liz Sly - WashingtonPost.com
Syrian rebels battling the regime of President Bashar al-Assad have begun receiving significantly more and better weapons in recent weeks, an effort paid for by Persian Gulf nations and coordinated in part by the United States, according to opposition activists and U.S. and foreign officials.
Obama administration officials emphasized that the United States is neither supplying nor funding the lethal material, which includes antitank weaponry. Instead, they said, the administration has expanded contacts with opposition military forces to provide the gulf nations with assessments of rebel credibility and command-and-control infrastructure.
IMF to buy Gold worth $2.3 billion as credit risk increases
NEW YORK (Commodity Online): The International Monetary Fund (IMF) is planning to purchase more than $2 billion worth of gold on account of rising global risks. The IMF currently holds around 2800 tonnes of gold at various depositories.
"The Fund is facing increased credit risk in light of a surge in program lending in the context of the global crisis. While the Fund has a multi-layered framework for managing credit risks, including the strength of its lending policies and its preferred creditor status, there is a need to increase the Fund's reserves in order to help mitigate the elevated credit risks", Bloomberg quotes a report by an IMF staff while also adding that a $2.3 billion gold purchase is in the planning.
Greece Faces Big Debt Payment Tuesday: Now What?
By: Michelle Caruso-Cabrera - CNBC.com
As if the Greek situation wasn't messy enough, a missing paragraph from a key legal document is throwing a wrench into a debt deadline.
Greece has a 436 million euro principal repayment due Tuesday. So far, the country has not decided what to do.
Under normal Greek-debt contracts, if Greece doesn't pay, it would have only a seven-day grace period. But experts who have pored over all of this have found that one of the key paragraphs from the normally boiler-point language is missing.
'Accidental war' waiting to happen on EU periphery
BY ANDREW RETTMAN - EUObserver.com
YEREVAN - If or when a full-blown conflict erupts between Armenia and Azerbaijan, it will probably begin like this.
According to a senior source in the Armenian defence ministry, on 27 April Azerbaijani troops sneaked over the Armenian border in the north-east province of Tavush and took up positions on either side of a road connecting the villages of Movses and Aygepar.
Brace, brace. Dark times ahead as Greece heads for the exit European policymakers are about to commit another major blunder in their handling of the eurozone debt crisis, and this time it could well be fatal.
By Jeremy Warner - Telegraph.co.uk
Mistakenly, they have convinced themselves that it won't much matter if Greece leaves, and indeed that it might even help resolve the wider crisis to get rid of this persistent thorn in the flesh.
Bring it on, they mutter callously; it will be a lot worse for them than for us. On one level, this is just bravado. It's an attempt to put as nonchalant a face as possible on the now apparently inevitable. But they also seem to believe in their validity of their own analysis – that they have indeed used the past two years well, and are now fully prepared for a Greek exit.
Europe prepares for chaos
as Greece plans default and exit from the Eurozone
Last week was a truly hectic one for the EU, with violent anti-austerity demos and political deadlock again casting doubts over the future of the euro. In Spain, as many as hundreds of thousands marched in nationwide protest. They chanted slogans and waved banners demanding an end to cuts and painful austerity. In Italy, violent anti-austerity clashes erupted in the city of Naples, after yet another suicide apparently caused by an aggressive government taxation program. But above all that, is the political turmoil in Greece. There, a last-ditch effort to form a coalition has all but collapsed over differences on austerity and bailout terms. The country now looks likely to stage new elections. For more on what lies ahead for Greece, and the implications for the EU, RT talks to Panagiotis Sotiris, who is a journalist and lecturer on social and political philosophy at the University of the Aegean.
Brinkmanship rhetoric hides cost of Greek euro exit
BY HONOR MAHONY - EUObserver.com
BRUSSELS - Within the space of one week, EU politicians have begun talking in a matter-of-fact way about Greece's possible exit from the eurozone, but analysts say the event would involve upheaval far beyond what the casual statements imply.
German finance minister Wolfgang Schauble changed the terms of the debate on Greece last week by saying that he thought the eurozone would be able to withstand the country leaving the single currency.
Will the continent act to avert an economic cataclysm?
By Niall Ferguson - TheDailyBeast.com
With the sap rising and the governments falling, all the European powers are merrily acting in national character.
In the midst of a severe financial crisis, the French have just elected a champagne socialist on promises of a 75 percent top tax rate and a lower retirement age. The Greeks also had an election in which the established parties lost to a ragbag of splinter groups. The outcome of the election was that they need to have another election. (Cue Zorba the Greek theme music.) Meanwhile, the wailing gloom of the flamenco emanates from Spain, where youth unemployment is now around 50 percent.
Eurozone in 'very political' meeting on Greece and Spain
BY VALENTINA POP - EUObserver.com
BRUSSELS - Eurozone finance ministers are to hold a "very political" meeting on Monday (14 May) amid intensified speculation of a Greek exit from the single currency and worries over the deficit implications of the Spanish bank rescue.
While no decisions are expected from the meeting, which starts at 3pm Brussels time, ministers are likely to make statements on the necessity for Greece to form a government. "It will be a very political meeting," one eurozone official told journalists in Brussels ahead of the event.
Debt Contagion Is Real, and It Doesn't End With Spain
For good or ill, Europe has embarked on a program that will require multiple trillions of euros of freshly minted money in order to maintain the eurozone.
By John Mauldin - Minyanville.com
A common mistake that people make when trying to design something completely foolproof is to underestimate the ingenuity of complete fools. --Douglas Adams, The Hitchhiker's Guide to the Galaxy
For quite some time in this letter I have been making the case that for the eurozone to survive, the European Central Bank would have to print more money than any of us can now imagine. That the sentiment among European leaders was that they were prepared for such a move was clear – except for Germany, which is haunted by fears of a return to the days of the Weimar Republic and hyperinflation.
Europe chain reaction feared in Greek standoff Greek deadlock heightens fears of full European economic crisis
By Howard Schneider and Anthony Faiola - WashingtonPost.com
Political deadlock in Greece rattled world markets Monday, reviving fears that the fractious Mediterranean country could spurn an international bailout, abandon the common European currency and risk a fresh round of world economic turmoil.
European stock indexes fell, with Greece's market now at a 20-year low, while the euro currency continued a recent decline against the dollar. U.S. stocks also fell.
Greek bank-run threat splits analysts
By Mary Watkins in London - FT.com
One crucial uncertainty hanging over a Greek exit is whether it would lead to a deposit flight, with customers and companies rushing to withdraw money from banks in other eurozone countries.
Analysts are divided over just how serious the threat really is of bank runs in economies such as Italy and Spain.
Huw van Steenis, banking analyst at Morgan Stanley, said if Greece were to exit the euro, concerns would clearly spill over into other southern European countries. "The question would then be what policy measures could be put in place to stop potential capital flight and restore confidence.
Could a Greek Bank Run Go Global?
By LAURENCE J. KOTLIKOFF - HuffingtonPost.com
The biggest worry from Greece's potential departure from the euro is a global bank run. In recent years, Greece has experienced a major bank run. Indeed, in February, theEconomist reported that Greek banks have lost 27 percent of their deposits since 2009.
But there are still, apparently, 150 billion euro in bank deposits held by the Greek banks and, no doubt, substantial other relatively short-term liabilities.
Faith fades in eurozone firewall
By Robin Wigglesworth in London and Miles Johnson in Madrid - FT.com
Fears that the eurozone's firewall will prove insufficient to shield Spain and other embattled countries against the effects of a possible disorderly Greek exit from the currency union hit European financial markets on Monday.
Spanish and Italian 10-year borrowing costs shot up to their highest levels this year and European stock markets suffered their biggest one-day drop in three weeks. German 10-year bond yields fell to a record low, widening the premium Madrid pays to borrow compared to Berlin to a new euro-era high.
Why A Greek Exit From The Euro
Would Mean The End Of The Eurozone
By Michael Snyder - TheEconomicCollapseBlog.com
What was considered unthinkable a few months ago has now become probable. All over the globe there are headlines proclaiming that a Greek exit from the euro is now a real possibility. In fact, some of those headlines make it sound like it is practically inevitable. For example, Der Spiegel ran a front page story the other day with the following startling headline: "Acropolis, Adieu! Why Greece must leave the euro". Many are saying that the euro will be stronger without Greece. They are saying things such as "a chain is only as strong as its weakest link" and they are claiming that financial markets are now far more prepared for a "Grexit" than they would have been two years ago. But the truth is that it really is naive to think that a Greek exit from the euro can be "managed" and that business will go on as usual afterwards. If Greece leaves the euro it will set a very dangerous precedent. The moment Greece exits the euro, investors all over the globe will be asking the following question: "Who is next?" Portugal, Italy and Spain would all see bond yields soar and they would all likely experience runs on their banks. It would only be a matter of time before more eurozone members would leave. In the end, the whole monetary union experiment would crumble.
Euro finance minsters plead with Greece to stay the course
By Raf Casert - AP - WashingtonTimes.com
BRUSSELS (AP) — Leading European Union finance officials on Monday pleaded with Greecenot to renege on its bailout terms and to stay the course of its painful austerity program to prevent even worse economic hardship.
Greeks fed up with the painful austerity measures gave support to anti-bailout parties in last week's elections. Many euro finance ministers warned, however, that Athens must stick to the terms of the rescue package if it wants to remain in the 17-nation eurozone.
Cradle of Democracy, Grave of Democrats:
How Greece Could Sink Obama's Re-Election Do voters put too much emphasis on events outside of the president's control?
By Dominic Tierney - TheAtlantic.com
First, Antonis Samaras of the New Democracy Party attempted to form a governing majority in Greece's Parliament and he failed. Next, Alexis Tsipras, of the radical-left Syriza party, tried to pull the sword from the political stone, and he also failed. Now the head of the Socialists, Evangelos Venizelos, is struggling to create an administration in Athens. Samaras, Tsipras, and Venizelos are hardly household names in the United States, yet they may hold significant power over President Obama's fate.
The 2012 U.S. presidential election could be in many ways about the global economy. If Europe stabilizes, the global economy will be more likely to steady itself, which could lead U.S. job creation to tick upward, the stock market to advance, and the odds to favor Obama's reelection. But if Greece lurches off the cliff edge, taking Europe with it, the markets may tank, job creation could stall, and suddenly we're looking at a Mitt Romney presidency.
Recession returns to ratchet up euro misery If you thought today looked bad, tomorrow looks worse. Amid all its other woes, the eurozone is now in recession, or that's what most experts predict will emerge from tomorrow's official figures.
By Damian Reece - Telegraph.co.uk
GDP is contracting, a fact that will serve to highlight the eurozone's haves (Germany) and its have-nots (Greece, Portugal, Spain, Italy and Ireland).
The single currency is pulling apart economically. It is pulling apart financially – Italian and Spanish bond yields separated even further from Germany today – and it is pulling apart politically, a process that will only be encouraged by the realisation among voters that a single currency can engender both growth and grind.
Moody's downgrades Italian banks; outlooks remain negative Actions conclude the review announcements
of 15 February 2012 and other dates
Global Credit Research - ZeroHedge.com
Milan, May 14, 2012 -- Moody's Investors Service has today downgraded by one to four notches the long-term debt and deposit ratings for 26 Italian banks, including five banks that are part of larger groups. In almost all cases, the rating actions reflect concurrent downgrades of these banks' standalone credit assessments, rather than changes in Moody's assumptions about levels of third party support, including Government support.
Credit Default Swaps: Still Here, Still Able to Wreak Havoc
By John Grgurich, The Motley Fool - DailyFinance.com
JPMorgan Chase (JPM), the country's biggest bank, is reporting a $2 billion trading loss that occurred in the space of just six weeks. The loss reportedly involved the investments in "credit default swaps" -- yes, those same complicated investments that played such a large role in the financial crisis.
Here's what we know so far, and why credit default swaps still pose such a threat to the U.S. economy.
The tale of the London whale
The loss occurred in JPMorgan's chief investment office, or CIO, the unit in the bank assigned with hedging the bank's own investments.
Jim Rogers: "Volume Is Not Going To Come Back.
We've Had A Great 30 Years. That's Finished!"
Submitted by Tyler Durden - ZeroHedge.com
Jim Rogers is hedging his gold (and silver) positions reflecting that this is normal, following such a tremendous run, and that this is good for the precious metal in the long-run. In his discussion with Maria Bartiromo this afternoon, he notes India's anti-gold 'protectionism' (and its potential balance of payments issues) that are trying to force the hoarding into risky 'productive' assets (as others might say). The immutable commodity maven suggests JPMorgan (and its peers) could be behind the drops in the overall commodity complex as the uncertainty of their positions (and liquidation potential to raise cash as bank examiners begin their forensics) becomes more important. He holds the USD, which he hates; has a number of equity shorts; and is most fearful of banks - specifically admitting he is a serial seller of calls on JPMorgan. His advice, and perhaps Maria should look into it given their ratings recently, is to become a farmer; own farmland; and speculate on agriculture. On the dismal 'ethical' state of our leaders and management, the thoughtful Rogers opines, "You can read world history for decades. There are always people doing things wrong. We have not changed our human nature and we will continue to have scandals and problems" and in a follow-up to CNBC's standard 'money-on-the-sidelines' argument he crushes the money-honey's dreams: "Finance had a great 30 years. That's finished.
Dancing at the Edge of a Cliff
John P. Hussman, Ph.D. - HussmanFunds.com
In recent weeks, I've emphasized that our estimate of prospective market return/risk in stocks has slipped into the most negative 0.5% of historical data (reflecting a range of horizons from 2 weeks to 18 months). Last week that estimate actually deteriorated, but I am reluctant to make comments on such a small sample, as the only more negative estimate in post-Depression history was on September 16, 2000. Even in the conditions that match the worst 2% of our return/risk estimates (which is the part of the tail we have been in since late-February), the market has lost an average of 20-25% just in the following 6-month period. As much as I try to maintain equanimity - focusing on the average outcome of a particular set of market conditions rather than the specific instance at hand - it is very difficult to do so at present.
Dick Bove: No Reason to Break Up Big Banks
By: Bruno J. Navarro - CNBC.com
JPMorgan's much ballyhooed $2 billion loss is no reason to ramp up regulations, noted bank analyst Dick Bove said Monday.
"I don't think there's any reason to break up the big banks," he said on CNBC's "The Kudlow Report." "Particularly if a bank can earn $18 billion a year and $22 billion the next year, why in heaven's name would you say it can't be run?"
The Rochdale Securities analyst rejected the notion that JPMorgan Chase, which last week disclosed it had made a bad hedge, was in any sort of long-term financial trouble.
JPMorgan Chase Lost $2 Billion
But Dimon Lost His Golden Status
By Charlie Gasparino - TheDailyBeast.com
Jamie Dimon's role as Wall Street's chief spokesman against Washington oversight took an unexpected detour Thursday afternoon when the financial world discovered, he is human after all.
The bank he runs, JPMorgan Chase, announced a huge trading loss, which is shocking only because it's run by Dimon, hands down the Street's best CEO because he successfully steered JPMorgan Chase away from such risk taking during the financial crisis and has since emerged as the banking industry's chief spokesman against post financial crisis regulation.
JPMorgan prepares for D.C.'s worst
By ANNA PALMER - Politico.com
JPMorgan Chase & Co. can't bank on having friends as it prepares to face the glare of Washington scrutiny.
Lawmakers in the House and Senate are calling for hearings on the bank's $2 billion loss. And the company's Washington office has fielded more than two dozen phone calls from congressional offices asking questions about the trading debacle.
Meanwhile, major trade groups that represent the industry aren't rushing to its defense, declining to comment when contacted by POLITICO. No member of Congress has emerged as a vocal surrogate for the bank, while several powerful lawmakers have been publicly critical.
Tossing blame for JP Morgan trade? Don't forget the Fed. Sure, blame JP Morgan's traders. But don't forget what motivated them to take on extra risk -- the Federal Reserve's low interest rate policy has left banks scrambling to make up for lost income on loans.
By Cyrus Sanati - Fortune.com
FORTUNE -- Who is to blame for JP Morgan's growing multi-billion dollar trading loss? While it is easy to just fire and demonize the traders and managers who executed the trades, as JP Morgan did this morning, such a move seems woefully inadequate in this case. Meanwhile, pointing the figure at the hedge funds that made millions betting against JP Morgan may feel good, but it isn't right either. They were just attempting to make money and rebalance the dislocation in the market created by the bank's massive positions.
No, the roots of this blunder seem to stretch well beyond Wall Street, beginning in Washington with the Federal Reserve's low interest rate policy. Linking the Fed with this event might seem like a stretch, but consider how the low interest rate policy has zapped bank profits. It has forced them to take greater risk and, to quote JP Morgan CEO Jamie Dimon, to also do "stupid" things, all in an attempt to make a quick buck.
JP Morgan fiasco prompts White House push
for tighter Wall Street regulations Obama administration puts pressure on Romney and Republican members of Congress to end resistance to strict regulation
By Ewen MacAskill in Washington - Guardian.co.uk
The White House has stepped up pressure on Republican members of Congress to end their opposition to the tighter regulation of Wall Street in the wake of the JP Morgan Chase trading fiasco.
It was its first comment since JP Morgan announced a $2bn trading loss on Friday. The White House also took a swipe at Republican presidential candidate Mitt Romney, who opposes tighter regulation and favours repealing some of the existing regulations.
JPMorgan's trading debacle: why $2 billion is just the start The bank's bad bet could curtail profits for years to come.
By Stephen Gandel - Fortune.com
FORTUNE -- For years, JPMorgan Chase (JPM), perhaps the riskiest bank in the world, got a pass. Sure there were minor hiccups along the way. But basically investors had the attitude with the bank run by Jamie Dimon that they were going to be hands off. Sub-prime mortgage loans: You've proved you can handle them. Foreclosure problems: We're sure you've got your best people on it. A derivative portfolio roughly the size of the GDP of India: We trust that you have covered your bets.
In fact, despite its huge size and complexity and risk, investors have allowed Dimon and JPMorgan to skate by on one of the smallest capital cushions, which is how much equity you have to protect against losses, on Wall Street. When you sort JPMorgan's loans and investments by riskiness, a dubious calculation, but used by Wall Street nonetheless, the bank holds an equivalent of just 10% of that as capital. That compares to 13% at Citigroup (C) and 15% at Goldman Sachs (GS).
Warren Fires Back at Dimon: Oust Him from the NY Fed
By ERIC PIANIN, The Fiscal Times
Elizabeth Warren, the one-time congressional overseer of the Wall Street bailout, has a suggestion for how CEO Jamie Dimon can best respond to JPMorgan Chase's stunning $2 billion trading blunder – resign from the New York Federal Reserve Board as a "public acknowledgment that he is in a position of trust."
Warren, the leading Democratic candidate for a Senate seat in Massachusetts, said Monday on CBS "This Morning," "I'd like to see some real accountability here. I'd like to see Jamie Dimon, for example, resign from his position as a Class A director of the New York Federal Reserve Bank."
Biderman And Bianco
Bury Bernanke's Bond Bull Market Backbone
Submitted by Tyler Durden - ZeroHedge.com
Digging into the details of the Fed's balance sheet can sometimes be a thankless task but Charles Biderman and Jim Bianco have some fascinating insights into where the real money is being hidden. The stability of the Fed's balance sheet post-QE2, given we are borrowing-and-spending over $100bn per month is all down to Operation Twist and the Fed's creation of demand at the short-end (via telling banks that rates will be low forever and 'guaranteeing' positive carry returns on rolling overnight repo) and using this 'cash' to almost entirely fund longer-term borrowing. In a simple primer of the Fed's implicit risk-free carry trade, the two chaps note that the only downside is too much growth or inflation which would cause a massive unwind of these positions (leading only to further bailouts). Critically though, they explain the fact that Operation Twist (and its implicit off-balance-sheet funding of this risk-free carry trade) is nothing more than the Fed's version of the ECB's LTRO - as the banks are 'encouraged' to buy short-term government debt with risk-free-carry expectations - implying the Fed's balance sheet could in fact be considerably larger than it appears. Yet more ponzinomics explained in a simple way - that surely eventually will trickle down to the masses who will question the emperor's clothing.
Ally Financial mortgage unit files for bankruptcy
Ally's ResCap Files Bankruptcy, Plans Sale to Fortress (Update 3)
By Steven Church, Phil Milford and Dakin Campbell - Bloomberg.com
Residential Capital LLC, the unprofitable mortgage company whose parent Ally Financial Inc. (ALLY) is trying to repay a U.S. government bailout, filed for bankruptcy and plans to sell most of its assets to Fortress Investment Group LLC. (FIG)
ResCap listed assets of $15.7 billion and debt of $15.3 billion in a petition filed today in U.S. Bankruptcy Court in Manhattan. ResCap's Chapter 11 filing is the biggest so far this year, based on liabilities, according to data compiled by Bloomberg.
Another bank paying millions to settle excessive fees case
Philadelphia Business Journal by Jeff Blumenthal, Reporter
TD Bank has agreed to settle a $62 million class-action lawsuit accusing the bank of overcharging customers on checking account overdraft fees.
The settlement, which must be approved by a federal judge in Miami, would resolve claims by customers who sued over fees charged to debit cards attached to their checking accounts.
"We have reached a settlement subject to approval by the court," TD said in a statement. "We feel that it is in the bank's best interest to put this matter behind us."
Treasury Yields Fall to Seven-Month Low on Greek Concern
By Cordell Eddings and Susanne Walker - Bloomberg.com
Treasuries rose, driving the 10-year yield to a seven-month low, as Greece's leaders prepared for more talks on forming a government amid concern failure will force the nation from the euro area.
U.S. debt advanced for a second day, with seven-year note yields falling to a record low 1.1679 percent, after the party of German Chancellor Angela Merkel was defeated in an election in the nation's most-populous state. The difference between the two-year swap rate and the yield on similar-maturity U.S. debt widened to the most since January.
The 'Fiscal Cliff' Looms Over Taxes and Spending
By ERIC PIANIN, The Fiscal Times
Just how the politically divided Congress and the Obama administration will muddle through the next six months is impossible to say, but their failure to come to grips with a raft of thorny spending and tax issues would pose hardships for millions of Americans reliant on government aid and possibly set back the economic recovery.
At the close of 2012 and the dawning of 2013, many major fiscal events are set to occur simultaneously. It's what Federal Reserve Board Chairman Ben Bernanke has called "a fiscal cliff" of spending and tax changes of a high magnitude. These include expiration of the Bush era tax cuts, the payroll tax cut and other important tax provisions. They also include the activation of the first installment of the $1.2 trillion across the board cuts or 'sequester" of domestic and defense spending. And, once again, Congress may have to raise the debt ceiling.
Property Tax Revolution - North Dakota
On June 12, 2012, the voters of North Dakota will vote on Measure 2, a comprehensive state constitutional amendment that, if passed, will abolish the property tax once and for all in that state, such that property ownership, and not rental from the government, becomes their reality.
Is the Government Backing a New Housing Bubble?
By DAVID FRANCIS, The Fiscal Times
Right now, the U.S. Federal Housing Authority is offering historically low interest rates on home loans as part of an effort to kick-start the housing market. Under a plan introduced by President Barack Obama, an FHA-qualifying U.S. homebuyer can apply for a 30-year mortgage with a fixed interest rate of 3.75 percent and a 15-year fixed mortgage at 3 percent. FHA loans require as little as 3.5 percent of the home's value up front in the form of a down payment.
Compare this to a traditional mortgage offered by a private bank. Private banks require large down payments of buyers – traditionally 20 percent – to qualify for a low interest rate.
Banana Republic of California
By Wolf Richter - ZeroHedge.com
The horse-trading sessions in Greece brokered by President Karolos Papoulias will most likely lead to new elections, and the inevitable: Greece's exit from the Eurozone. The uncertain consequences for Greece and the rest of Europe will confound jittery financial markets. And while all eyes are fixed on Greece, a tiny economy on the worldwide scale, a much larger economy is heading deeper into fiscal disaster: California.
California has everything: stunning mountains and deserts, a breath-taking coast, delicious seasonal fruit and veggies, gourmet cheeses, a large variety of seafood, and grass-fed beef—well, and a mad cow, too.
California wants to tax rich to solve budget woes
By Tami Luhby @CNNMoney
NEW YORK (CNNMoney) -- Tax the rich! That's how California Governor Jerry Brown wants to solve the state's growing budget crisis that now nears $16 billion.
The governor laid out his revised spending plan Monday. It would slash $8.3 billion from almost every part of the state's government. But it would increase funding for K-12 education if voters approve his proposal to hike income taxes on the rich and sales taxes on everyone.
If You Live In California Things Just Got A Whole Lot Worse
By Michael Snyder - TheEconomicCollapseBlog.com
Why does the state of California seem to be so incredibly hopeless? These days California can't seem to do anything right, and if you live in California things just got a whole lot worse. Governor Brown has announced that the state budget deficit for this year is going to be much larger than projected, that more government services are going to be cut and that voters are going to vote on another round of tax increases in November. Meanwhile, unemployment is sitting at 11 percent and extended federal unemployment benefits for workers in the state are ending. Because California is one of the worst places in the nation to conduct business, there has been a steady flow of companies leaving the state. Those companies have taken a whole lot of good jobs with them. Due to the lack of jobs and a steady stream of impoverished immigrants coming in from Mexico and other countries, poverty in the state has exploded and crime is rapidly increasing. California may be the land of "endless sunshine", but for the California economy there are only dark clouds on the horizon. The state is coming apart at the seams and there is not much hope that things are going to turn around any time soon.
Declining Employee Loyalty: Red Flag for Business
By STAFF, Knowledge@Wharton
If loyalty is defined as being faithful to a cause, ideal, custom, institution or product, then there seems to be a certain amount of infidelity in the workplace these days.
Consider some recent studies: MetLife's 10th annual survey of employee benefits, trends and attitudes released in March puts employee loyalty at a seven-year low. One in three employees, the survey says, plans to leave his or her job by the end of the year. According to a 2011 Careerbuilder.com report, 76 percent of full-time workers, while not actively looking for a new job, would leave their current workplace if the right opportunity came along. Other studies show that each year, the average company loses anywhere from 20 percent to 50 percent of its employee base.
Ron Paul suspends presidential campaign –
but supporters stay loyal Republican candidate likely to use his 100 delegates at the national convention in Tampa as supporters deny Paul is out
By Tom McCarthy in New York - Guardian.co.uk
After building a political campaign that was long on passion and grassroots support, if ultimately short of votes, Texas congressman Paul announced today that he is suspending his hunt for the presidency.
The candidate urged supporters to continue their efforts to amass delegates at state conventions, however, as part of a strategy to gain a voice at the Republican National Convention – and influence over the direction of the party.
Paul won't campaign in any more states
By Cameron Joseph - TheHill.com
Ron Paul won't campaign in any more primaries, his campaign announced Monday afternoon.
A letter sent from Paul to supporters promised to continue the battle for delegates at state party conventions in order to try to influence the party's platform, but said the campaign will no longer try to win delegates in new states — an uphill battle now that Mitt Romney is the presumed nominee and most states have gone to a winner-take-all system of delegate apportionment.
Poll shows little taste for third-party candidates Democrats less keen on concept
By Stephen Dinan - The Washington Times
There's a substantial appetite among American voters for an option other than the two major parties in this year's elections — but there's little taste for any of the third-party or independent candidates currently competing, according to the latest poll by The Washington Times/JZ Analytics.
While voters said they'd like more options, the vast majority conceded they usually only look to the Republican and Democratic parties for their choices, and said there are structural barriers that prevent third-party candidates from getting in the race or winning the kind of attention it takes to make a splash.
North Dakota oil boom:
thousands pin their dreams on striking it rich Business is booming and salaries are high in this tiny patch of the US, but the exhausting toil is more than many bargain for
By Suzanne Goldenberg in North Dakota - Guardian.co.uk
It's a life measured out in 18-hour shifts and washed down with 5-hour Energy Drinks and Red Bull, a job on the rigs in North Dakota's oil boom: three weeks on, two weeks off, in exchange for $100,000 or more a year and the promise of being set up for life.
In an America where 18m are out of work, the chance of finding any job – let alone a well-paid job – exerts an irresistible force that is drawing thousands to North Dakota in a 21st century re-enactment of the Gold Rush.
State of the 'Unions': Hard Times, But Hanging On
By STAFF, Knowledge@Wharton
Labor unions have long been a potent force in American business and politics. But the last several decades have seen a steep decline in corporate union power as membership ranks have dwindled. Aside from a few industries where unions remain formidable, including airlines, where US Airways' efforts to merge with American Airlines were given a recent boost by support from American's unions, the dwindling of labor union power and influence is likely to continue.
"They have declined to the point of irrelevance in most workplaces," says Peter Cappelli, Wharton management professor and director of Wharton's Center for Human Resources. And rather than focusing on expansion, unions are simply trying to minimize the ground they are losing every year, he notes. "They are having a hard time hanging onto whatever [contract] arrangements they have."
Should You Purchase Long-Term-Care Insurance?
WSJ.com
Long-term-care insurance. It's a subject most people don't want to think about—but many people know they need to.
At first blush, policies that help pay the costs of extended nursing care make perfect sense. Bills add up quickly when you can no longer take care of yourself and your needs exceed what family and friends can provide. Nursing homes, assisted-living centers and home care all are expensive, and there is no telling for how long you may need the service. Buying a long-term-care insurance policy can be a way of making sure your future physical needs will be met. Policies designed in partnership with state governments also give individuals and their families a way to protect savings in the event of burdensome care costs that stretch on for years.
Apple Patent Describes a More Secure Face-Recognition System
By Christina Bonnington - Wired.com
A new Apple patent application concerning face-recognition technology suggests an interesting security update for iOS. And that could be just the beginning of what the technology might enable.
The patent, "3D Object Recognition," describes a novel way to generate 3-D models using 2-D images. It's a follow-up to a patent Apple already owns, originally filed by Swedish firm Polar Rose, which Apple purchased in late 2010.
In essence, the technology would use multiple photos, or even video, to create a robust 3-D representation of a user's face. With this 3-D representation locked in, it could then be compared, on the fly, to a 3-D representation built in real time from a 2-D image captured from a user's phone.
Rosenberg Says Gold 'Will Go to $3,000 Per Ounce'
BY MARK O'BYRNE - FinancialSense.com
Gold's London AM fix this morning was USD 1,580.75, EUR 1,221.69 and GBP 980.98 per ounce.
Yesterday's AM fix was USD 1,590.00, EUR 1,228.37, and GBP 987.39 per ounce.
Gold rose $3.00 or 0.18% in New York yesterday and closed at $1,594.00/oz. Gold ticked lower in Asia and in Europe and breached yesterday's intraday low of $1,580/oz.
Margin related selling occurring in Gold, Silver
LONDON (Commodity Online): Gold sometimes falls with other markets on selling by investors who need to raise cash to meet margin calls, and newsletter writer Dennis Gartman suggests margin-related selling may be happening again.
He cites a Wall Street saying: "Sometimes it is not what you want to sell but what you can sell that counts." Gartman says "with the J.P. Morgan story on the front pages and with the margin clerks in high spirits as their duties are now front and very center, gold, silver et al are being sold because that is what can be sold and there is where liquidity lives."
Some physical buying emerges as Gold prices retreat
LONDON (Commodity Online): Some physical buying has occurred on gold's pullback, helping the market bounce from its weakest levels early in the day, said Afshin Nabavi, head of trading at MKS Finance.
"Since yesterday, we've been seeing some physical buying and physical shipments going through" although "nothing huge yet," he added.
EU leaders set for showdown on fate of euro as crisis deepens
Angela Merkel and François Hollande to have first face-to-face talks in Berlin after eurozone finance ministers meet in Brussels
By Ian Traynor - Guardian.co.uk
Europe is braced for a crucial 48 hours of high-stakes summitry likely to decide whether Germany and France can strike a grand bargain aimed at dispelling growing pessimism over the chances of the single currency surviving in its current form.
While eurozone finance ministers are to meet on Mondayin Brussels, apparently at a loss over how to respond to political paralysis in Greeceand a worsening crisis in Spain, all eyes are on François Hollande, the new French leader, who is to go to Berlin for his first face-to-face meeting with the German chancellor, Angela Merkel, as soon as he is sworn in as president on Tuesday.
European Political Extremists Demand Authoritarian State The discontent that is currently simmering in Europe will soon prove to be the catalyst that leads to the ascension of a dictator.
BY ANDREW MIILLER - theTrumpet.com
A spirit of extremism is sweeping across Europe. As deteriorating economic conditions and German-led austerity programs take hold in almost every nation of the eurozone, parties on both the far-left and the far-right are rising. These worrying trends will only intensify as anger and resentment continue to build.
In France, over one third of voters cast a ballot for either far-left Trotskyites or far-right nationalists in the first round of voting last April. In Greece, the situation is even worse, with a full 70 percent of voters supporting either radical left-wing socialists or far-right xenophobes.
How do you spell D-E-F-L-A-T-I-O-N? EU urges more cuts, despite eurozone recession
BY VALENTINA POP - EUObserver.com
BRUSSELS - The EU commission on Friday (11 May) confirmed earlier predictions that the eurozone economy will contract by 0.3 percent this year, with worsening forecasts for Greece, Spain and the Netherlands.
In its so-called spring economic forecast, the commission expects the euro area economy to stay in a 0.3 recession this year whereas the EU as a whole will have zero-growth, as predicted in an "interim" forecast published in February.
Europe: Big Problems Remain for Markets
BY CHRIS CIOVACCO - FinancialSense.com
In December 2011, the European Central Bank (ECB) attempted to paper over the debt crisis. As noted by the Wall Street Journal on April 18, "Europe's bold program to defuse its financial crisis by injecting cash into the banking system is running out of steam".
Since the credit markets in Spain and Italy have shown renewed signs of strain, the timing for elections in France and Greece was less than ideal for policymakers. On Friday morning, there were rumblings from Europe giving some basis for optimism to the post-election situation in Greece.
Keiser Report: Central Bank Monarchs (E287)
In this episode, Max Keiser and co-host, Stacy Herbert discuss the alleged meritocracy of old Etonians running the world (into the ground) while the rest of us remain wards of the state - from the President of France to PhDs on foodstamps. In the second half of the show Max talks to John Titus, producer of the new documentary, Bailout.
Greece will run out of money soon,
warns deputy prime minister Greece's deputy prime minister has said the country will run out of money in six weeks unless it honours its bitterly-disputed EU bailout deal.
By Andrew Gilligan, Athens - Telegraph.co.uk
Speaking exclusively to The Sunday Telegraph, Theodoros Pangalos said he was "very much afraid of what is going to happen" after Greek voters rejected the deal in elections last Sunday.
"The majority of the people voted for a very strange mental construction," he said. "We want to be in the EU and the euro, but we don't want to pay anything for the past."
If Greece goes ... With an exit looking possible, policymakers
and investors are shifting focus to the consequences
By Chris Giles, Peter Spiegel and Kerin Hope - FT.com
The idea of a Greek exit from the eurozone is no longer fanciful. After 70 per cent of voters in elections on May 6 supported parties that rejected the terms under which €174bn of international bailout loans were offered to Athens, many investors now see a fissure in the 17-member eurozone as increasingly likely. European governments are furiously thinking through the various scenarios, while still urging Athens to stick to its agreements on austerity and reform. If those hopes are dashed and Greece goes, what happens next?
1. Is Greece serious about quitting the eurozone?
Who knows? Opinion polls showing 80 per cent of Greeks in favour of staying in the euro combine with the election result to offer a scene of confusion.
Greece's European partners say Athens cannot have it both ways. But the siren call from the radical left coalition Syriza, that Greece is safe in the eurozone with its creditors poised to ease the harsh bailout, is music to the ears of hard-pressed citizens.
Greece would face dire consequences
from a euro exit – as its people know Reinstating the drachma is not in the interests
of the Greek electorate or the rest of the eurozone
By Vicky Pryce - Guardian.co.uk
Far from revealing that Greeks want to exit the euro, the election results send out a clear signal that the policy framework imposed since the crisis began has been wrong and needs to be rethought.
The majority of the electorate supported parties that would prefer to keep Greece in Europe, while delivering a strong rebuke to the two traditional parties of government, New Democracy and Pasok, for having brought Greece to bankruptcy and then being associated with the "austerity memorandum" – the terms of the troika bailout packages.
Euro Officials Begin to Weigh Greek Exit From Common Currency
By Patrick Donahue - Bloomberg.com
Greece's possible exit from the euro area moved to the center of Europe's debt-crisis debate, with officials beginning to weigh the fallout of a withdrawal even as authorities in Athens struggled to form a government.
Meetings brokered by Greek President Karolos Papoulias are set to continue today after Syriza, the largest anti-bailout party, rejected a unity government following last week's inconclusive elections. The country where the 2 1/2-year-old crisis began moved closer to a new vote, and to the possibility of a euro-area exit that was once a taboo among policy makers.
It's too late for Germany to save the euro Despite belated gestures from Berlin,
the single currency cannot survive
if and when Greece leaves it.
By Jeremy Warner - Telegraph.co.uk
For all the latest news on the escalating situation in the eurozone read our debt crisis live blog
Greece's motorcycling Marxist, Alexis Tsipras, makes an unlikely champion, with his commuter leathers and largely unrealistic Left-wing views, but he seems to be about the best of a bad bunch right now. As far as I can see, he's the only member of the Greek political class who makes any kind of sense, albeit only marginally so and with one rather important deficiency.
Germany: eurozone would survive Greek exit
BY HONOR MAHONY - EUObserver.com
BRUSSELS - German finance minister Wolfgang Schauble has said the eurozone would survive if Greece left it, with the single currency structures more robust than two years ago.
"We want Greece to remain in the eurozone. But it also has to want this and to fulfil its obligations. We cannot force anyone. Europe will not sink that easily," he said in an interview with Friday's edition of the Rheinische Post.
Greek leftist leader rejects coalition government
By William Spain, MarketWatch.com
CHICAGO (MarketWatch) — The leader of Syriza, a Greek radical left party, on Sunday said it would not join a coalition government to help put in place a harsh and deeply unpopular austerity program, Dow Jones Newswires reports.
The statement from Alexis Tsipras came shortly after a meeting with Greece's president and other political parties that it was hoped would forge an alliance to run the troubled nation.
And how much will the US chip in to save Greece? Britain to share costs of Greek exit Germany has drawn up plans to make Britain pay a share of the multi-billion pound clean-up costs if Greece is ejected from the euro, risking a clash with Downing Street.
By Ambrose Evans-Pritchard - Telegraph.co.uk
A finance ministry draft shows that Berlin is preparing a fresh bail-out to stabilise the Greek economy and stem EMU-wide contagion after a return to the drachma, should the country reject EU austerity demands.
The funds would come from Europe's rescue machinery but costs would be shared among all 27 EU members – not just the eurozone – on the grounds that Greece has a right to Brussels crisis funds, like any other member state with its own currency.
11 Quotes That Show How Worried
The Financial World Is About Europe Right Now
By Michael Snyder - TheEconomicCollapseBlog.com
The recent elections in France and in Greece have thrown the global financial system into an uproar. Fear and worry are everywhere and nobody is quite sure what is going to happen next. All of the financial deals that Greece has made over the past few years may be null and void. Nobody is going to know for sure until a new government is formed, and at this point it looks like that is not going to happen and that there will need to be new elections in June. All of the financial deals that France has made over the past few years may be null and void as well. New French President Francois Hollande seems determined to take France on a path away from austerity. But can France really afford to keep spending money that it does not have? France has already lost its AAA credit rating and French bond yields have started to move up toward dangerous territory. And Greek politicians are delusional if they think they have any other choice other than austerity. Without European bailout money (which they won't get if they don't honor their current agreements), nobody is going to want to lend Greece a dime.
World edges closer to deflationary slump
as money contracts in China All key indicators of China's money supply are flashing warning signs. The broader measures have slumped to stagnation levels not seen since the late 1990s.
By Ambrose Evans-Pritchard - Telegraph.co.uk
Narrow M1 data for April is the weakest since modern records began. Real M1 deposits – a leading indicator of economic growth six months or so ahead – have contracted since November.
They are shrinking faster that at any time during the 2008-2009 crisis, and faster than in Spain right now, according to Simon Ward at Henderson Global Investors.
China Lowers Banks' Reserve Requirements to Support Growth
By Bloomberg News
China cut the amount of cash that banks must set aside as reserves for the third time in six months, pumping money into the financial system to support lending after data showed a slowdown in growth is deepening.
Reserve ratios will fall 50 basis points, effective May 18, the People's Bank of China said on itswebsite yesterday. The level for the nation's largest lenders will decline to 20 percent based on previous statements.
Selling out US oil & gas deposits...
new way to balance trade deficit? Why Is The Obama Administration
Allowing The Chinese Government To Buy Up
U.S. Oil And Gas Deposits Worth Billions Of Dollars?
By Michael Snyder - EndOfTheAmericanDream.com
If we are trying to become independent of foreign oil, then why is the Obama administration allowing the Chinese government to buy up U.S. oil and gas deposits worth billions of dollars? This makes absolutely no sense whatsoever. The United States desperately needs to maintain control over its own domestic energy resources so that we can end our addiction to foreign oil. As I have written about previously, the United States actually has plenty of oil. If we would simply use the resources that we already have, we would never have to import a single drop of foreign oil. But instead, we continue to be the largest importer of oil on the planet and we are allowing China to rapidly buy up oil and gas deposits inside the United States. This is fundamentally wrong and it is a serious threat to our national security. But apparently everything is for sale in the United States today, and that includes our precious energy resources.
* * * * *
Lindsey Williams warned us about a 'crack' in the derivatives market... here it is via JMP.
Chaos, Derivatives, and Quantum Physics
BY CRIS SHERIDAN - FinancialSense.com
Every day the financial markets get more chaotic—a fact that couldn't be made any more clear than with a recent revelation given by ex-physicist and author, Nick Dunbar, in describing a new level of complexity facing banks and derivatives. Ironically, Thurdsay night's emergency conference call by JP Morgan of a massive $2 billion unavoidable loss is perhaps a confirmation of what banks are now starting to grapple with.
After attending a recent conference in Barcelona featuring some of the top thinkers in quantitative analysis, Dunbar says that the financial crisis has now left "quants grappling with a new landscape...that has turned the old world upside down."
Bank fraud? SEC Tells JP Morgan Enforcement Action Coming
over Bear's Mortgage Backed Securities Violations
Posted by Teri Buhl
Fallout from JP Morgan trading losses, which led to rater Fitch downgrading their debt yesterday, aren't the only financial worries the banking behemoth is facing. Nestled in that shocking 10-Q filed Thursday is an admission that their regulator, the Securities and Exchange Commission, thinks some of the details that lead to the explosive Ambac mortgage security fraud suit against the naughty stepchild of JPM, Bear Stearns/EMC, are worthy of an enforcement action. Yep- the SEC is giving or finally gave them a Wells Notice, which means according to their 10-Q (and their 10-K) in January 2012 the SEC's investigation into the sins of Bear's Mortgage team run by Tom Morano, Jeff Verschleiser, Mike Nierenberg and the subsequent cover up by JPM was worthy of a civil suit along with some penalties.
Elizabeth Warren Calls for Dimon
to Resign From New York Fed
By C. Thompson - Bloomberg.com
Elizabeth Warren, a Massachusetts candidate for U.S. Senate, called for JPMorgan Chase & Co. (JPM) Chief Executive Officer Jamie Dimon to resign his position as a director at the Federal Reserve Bank of New York.
Dimon, who disclosed a $2 billion trading loss by his bank last week, shouldn't stay on the board of the New York Fed because "he advises the Federal Reserve on the oversight of the financial industry," she said in an e-mail release.
JPMorgan probe into London role in loss Senior members of trading division to leave
By Tom Braithwaite in New York
and Shahien Nasiripour in Washington - FT.com
JPMorgan Chase is investigating whether London-based traders hid the extent of losses on credit derivatives positions, according to people familiar with an internal probe following last week's revelation of $2bn losses.
The investigation comes as Jamie Dimon, chief executive, took to US television to say he was "dead wrong" to have dismissed questions over the risk-taking of his chief investment office.
After JPMorgan loss, a call for stricter oversight
AP - WSJ.com
WASHINGTON — JPMorgan Chase faces intense criticism for claiming that a surprise $2 billion loss by one of its trading groups was the result of a sloppy but well-intentioned strategy to manage financial risk.
More than three years after the financial industry almost collapsed, the colossal misfire was cited as proof that big banks still do not understand the threats posed by their own speculation.
"It just shows they can't manage risk — and if JPMorgan can't, no one can," Simon Johnson, the former chief economist for the International Monetary Fund, said Friday.
JPMorgan Executives Said to Prepare Exits After Loss
By Dawn Kopecki - Bloomberg.com
JPMorgan Chase & Co. (JPM) executives in the bank's chief investment office will leave as early as this week after the firm suffered a $2 billion trading loss, according to a person familiar with the matter.
Ina Drew, who oversees the unit, is among three executives set to leave, the Wall Street Journal reported today, citing unidentified people familiar with the situation. Chief Executive Officer Jamie Dimon previously resisted accepting her resignation, said the person, who requested anonymity because the discussions were private. Drew didn't immediately respond to a message seeking comment.
After JPMorgan's Huge Loss, Is More Regulation Needed?
Shares in JPMorgan Chase fell 9 percent Friday on news that the bank lost $2 billion over six weeks due to "self-inflicted" mistakes. Jeffrey Brown, The Wall Street Journal's Liz Rappaport, Michael Greenberger of the University of Maryland School of Law and consultant Bert Ely discuss the details and calls for more regulation.
Does JP Morgan Have Staying Power?
BY BRADY WILLETT - FinancialSense.com
News that JP Morgan lost $2 billion trading synthetic credit securities is spreading like wild fire. Shares of JPM are deeply in the red. The stench of Volcker is in the air:
"It's a pretty stunning admission for a company that prides itself on its risk management systems and the strength of its balance sheet. The timing couldn't be worse for the industry. At the end of the day, it will have ramifications across the broker-dealer community." Sterne Agee analyst Todd Hagerman.
Banks sink on JPMorgan loss; tech stocks gain
By Joshua Freed - AP - WashingtonTimes.com
JPMorgan's surprise $2 billion trading loss prompted a sell-off in financial stocks Friday, but the broader market rose as investors decided this was a problem for investment banks and not other industries.
The Dow Jones industrial average rose 31 points in morning trading after bouncing back from a 76-point decline. The Standard & Poor's 500 index rose four points to 1,362. The Nasdaq composite index, which is heavily weighted with technology stocks, was up 20 points at 2,954.
JP Morgan trader 'London Whale'
blows $13bn hole in bank's value Shockwaves spread across markets after $2bn trading loss at US bank, which had campaigned to water down regulations
By Simon Neville and Jill Treanor - Guardian.co.uk
The City trader at the centre of a $2bn trading loss at JP Morgan Chase had returned to his home in Paris on Friday as the repercussions of the loss spread across the markets.
Some $13bn was wiped off the value of America's largest bank after it admitted the scale of the trading activities of Bruno Iksil – nicknamed the London Whale for his bullish trading – and his colleagues in the bank's little known "chief investment office". The US Securities and Exchange financial watchdog was said to have begun reviewing the losses, the rating agency Standard & Poor's revised its outlook on the bank from stable to negative and Fitch Ratings downgraded it from A-plus to AA-minus.
JP Morgan's $2 Billion Loss
Was 4X the Alleged Cost of Financial Regulation
By Derek Thompson - TheAtlantic.com
Here is Barney Frank's statement on JP Morgan's of $2 billion loss in derivatives:
This regrettable news from JPMorgan Chase obviously goes counter to the bank's narrative blaming excessive regulation for the woes of financial institutions. Interestingly, in the Economist's long attack on the financial reform bill, one of their leading examples of the harm the bill is doing was JPMorgan Chase's assertion that complying with the new rules will cost $400 to $600 million at the outset (a number which will obviously go down as compliance processes are set in place). In other words, JP Morgan Chase, entirely without any help from the government has lost, in this one set of transactions, five times the amount they claim financial regulation is costing them.
Jamie Dimon: Hero Or Goat?
WSJ's Robin Sidel and Liz Rappaport visit Mean Street to examine how J.P. Morgan CEO Jamie Dimon had been built up in recent years to hero-like status by the media.
An economy more Clark Kent than Superman
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) — A recent Newsweek magazine cover story argues that the economy is secretly Superman, but, at the same time, some economists are warning of a coming recession.
Would the real economy please stand up?
At the moment, economists don't seem to know what to make of the start-and-stop nature of the data.
Obama pushes billion-dollar stimulus plan
By Dave Boyer - The Washington Times
Putting pressure on Congress to approve parts of his latest economic stimulus plan, President Obama urged Americans Saturday to push lawmakers to approve his multibillion-dollar "to-do list" for creating jobs.
"Each of the ideas on this list will help create jobs and build a stronger economy right now," Mr. Obama said in his weekly address. "Let's pushCongress to do the right thing. Let's keep moving this country forward together."
Top JP Morgan Chase exec to resign over loss
Michael Greenburger (CBS News report on JPM)
...."This kind of trade would have been banned" under a fully-implemented Dodd-Frank, Greenberger said. "JP Morgan Chase has been arguing that these kinds of trades should go forward. But (some of the rules) on Dodd-Frank, the way they were written, these kinds of risky, complex trades would be banned." What's scary about the situation is how likely it is to happen again.
"Of course it could happen at another bank next week," Greenberger said. "JP Morgan Chase and Jamie Dimon are the brightest guys in the room. If they have this problem, god knows how many other people have these problems. And this could lead us right back to where we were in 2008."
Home Not So Sweet:
Foreclosure & debt push Americans to extremes
More than 2.5 million houses in the United States have been repossessed by banks since the economic crisis struck the country. But the impact isn't only financial. Many forced out of their homes are taking drastic measures - with some even choosing to take their own lives when faced with eviction. RT's Madina Kochenova reports.
After Obamacare
By Edwin J. Feulner - PatriotPost.us
Who should be in charge of your health care -- you, or the government? That, in a nutshell, is what the debate over Obamacare is about.
True health care reform is needed. Unfortunately, the president's signature law is the wrong medicine. Which is why, if the Supreme Court affirms that the law is unconstitutional and overturns it, we shouldn't consider the problem solved. Not at all. We will simply have stopped applying a treatment that was making the problem worse.
Slippery-Slope Logic, Applied to Health Care
By RICHARD H. THALER - NYTimes.com
THERE are lots of important things to worry about these days: terrorism, the economy, climate change and, for Yankee fans, the loss of Mariano Rivera. But worry is a scarce commodity. Even a mother — Jewish or not — can't worry about everything. So it is important that we limit our worries to real as opposed to imaginary risks.
One pernicious category of imaginary risks involves those created by users of the dreaded "slippery slope" arguments. Such arguments are dangerous because they are popular, versatile and often convincing, yet completely fallacious. Worse, they are creeping into an arena that should be above this sort of thing: the Supreme Court, in its deliberations on health care reform.
3.6 Million Taxpayer Dollars Being Used To Support The Lavish Lifestyles Of Former Presidents Such As Bush And Clinton
By Michael Snyder - TheEconomicCollapseBlog.com
You are not going to believe how much money is being spent on our former presidents. At a time when U.S. government spending is wildly out of control, a total of 3.6 million dollars is being used to support the lavish lifestyles of former presidents such as George W. Bush and Bill Clinton in 2012. For 2013, the plan is to increase that amount to 3.7 million dollars. But do any of them really need this kind of welfare? The truth is that all of them are very wealthy. So what justification is there for giving them so much money? You can see the GSA budget proposal for former presidents for 2013 right here. The 3.7 million dollars for 2013 does not even include the cost of Secret Service protection. Rather, it only covers expenses such as office rentals, travel, phone bills, postage, printing and pension benefits. Certainly it is not unreasonable to grant former presidents a small pension, but should we be showering them with millions of dollars each year? At a time when the federal government is drowning in so much debt, the fact that these former presidents are willing to take such huge amounts of taxpayer money really does make them look like parasites.
Obama's Second Term Transformation Plans
By Steve McCann - AmericanThinker.com
The 2012 election has often been described as the most pivotal since 1860. This statement is not hyperbole. If Barack Obama is re-elected the United States will never be the same, nor will it be able to re-capture its once lofty status as the most dominant nation in the history of mankind.
The overwhelming majority of Americans do not understand that Obama's first term was dedicated to putting in place executive power to enable him and the administration to fulfill the campaign promise of "transforming America" in his second term regardless of which political party controls Congress. That is why his re-election team is virtually ignoring the plight of incumbent or prospective Democratic Party office holders.
Degrees of Debt A Generation Hobbled by the Soaring Cost of College
By ANDREW MARTIN and ANDREW W. LEHREN - NYTimes.com
ADA, Ohio — Kelsey Griffith graduates on Sunday from Ohio Northern University. To start paying off her $120,000 in student debt, she is already working two restaurant jobs and will soon give up her apartment here to live with her parents. Her mother, who co-signed on the loans, is taking out a life insurance policy on her daughter.
"If anything ever happened, God forbid, that is my debt also," said Ms. Griffith's mother, Marlene Griffith.
Ms. Griffith, 23, wouldn't seem a perfect financial fit for a college that costs nearly $50,000 a year. Her father, a paramedic, and mother, a preschool teacher, have modest incomes, and she has four sisters. But when she visited Ohio Northern, she was won over by faculty and admissions staff members who urge students to pursue their dreams rather than obsess on the sticker price.
California Deficit Swells to $16 Billion, Governor Says
By Michael B. Marois - Bloomberg.com
California's budget deficit has swelled to $16 billion after tax collections trailed projections amid the tepid economic recovery, Governor Jerry Brown said in a comment on his Twitter post.
The shortfall has widened from the $9.2 billion Brown estimated in January, after lawmakers resisted the Democrat's call for cost cuts, the federal government blocked other reductions and April income-tax revenue missed budget forecasts by $2 billion. On May 14, he's set to unveil a revised spending plan and to say how he would erase the gap.
California facing higher $16 billion shortfall
By Judy Lin - WashingtonTimes.com
SACRAMENTO, Calif. (AP) — California's budget deficit has swelled to a projected $16 billion — much larger than had been predicted just months ago — and will force severe cuts to schools and public safety if voters fail to approve tax increases in November, Gov. Jerry Brown said Saturday.
The Democratic governor said the shortfall grew from $9.2 billion in January in part because tax collections have not come in as high as expected and the economy isn't growing as fast as hoped for. The deficit has also risen because lawsuits and federal requirements have blocked billions of dollars in state cuts.
$1 billion 'ghost town' to be built in New Mexico A $1 billion (£620 million) 'ghost town'
is to be built in the United States
in the name of scientific research.
By Mark Hughes, New York - Telegraph.co.uk
The town, which will be modelled on a town of 35,000 people, will have roads, houses and commercial buildings, but will have no residents.
It will be built in New Mexico about 15 miles west of the nearest town, Hobbs, which has a population of about 40,000.
Scientists hope to use the new 'town' to research innovations in renewable energy as well as intelligent traffic systems and next generation wireless networks.
Obama's Soros-Controlled Energy Council
By Ken Blackwell - PatriotPost.us
When politicians want to look busy while avoiding tough decisions during an election year, what do they do? They form commissions and councils.
And when President Barack Obama saw Americans struggling with higher gasoline and home energy prices, did he encourage more domestic oil exploration, off-shore drilling, or coal production, while lowering taxes on energy? Of course not. After all, with political observers expecting a close presidential race this year, Obama needs the financial and institutional support far-left environmental groups. The result has been the President anointing certain energy sources - such as wind and natural gas - as energies of the future, while implementing regulatory hurdles for more dependable fuels like oil and coal.
Wallpaper That Protects You From Identity Theft
BY NATHAN HURST - Wired.com
There's that guy again, cruising down the block, scanning the airwaves for an open Wi-Fi network named "LINKSYS" or "NETGEAR" that the owner didn't bother to password-protect. Maybe he's just a freeloader. But what if he's an identity thief out to view your browsing history and — gasp — maybe even your bank statements! Wouldn't it be nice if you could both beautify your home and make your Wi-Fi network just disappear?
French researchers from the Grenoble Institute of Technology and the Centre Technique du Papierhave developed a way to do both, with a wallpaper that shields your home from Wi-Fi signals — incoming or outgoing.
What to Expect From the Maps App
if Apple Ditches Google Maps in iOS 6
By Christina Bonnington - Wired.com
Apple will reportedly ditch Google's backend for the built-in Maps app in iOS 6, according to sources with9to5Mac. The app is said to be faster and more reliable, and will come with a few shiny new features that users should eat right up.
"This move is entirely expected," Forrester analyst Charles Golvin told Wired via e-mail. "The relationship between Apple and Google has been moving steadily from one of partners to competitors, and Apple has increasingly sought to displace Google technology whenever possible."
On Defense Cuts, Both Parties Are Far Out of Step With Voters
By R. Jeffrey Smith - TheAtlantic.com
While politicians, insiders, and experts may be divided over how much the government should spend on the nation's defense, there's a surprising consensus among the public about what should be done: They want to cut spending far more deeply than either the Obama Administration or the Republicans.
That's according to the results of an innovative, new, nationwide survey by the Center for Public integrity, the Program for Public Consultation, and the Stimson Center. Not only does the public want deep cuts, it wants those cuts to encompass spending in virtually every military domain -- air power, sea power, ground forces, nuclear weapons, and missile defenses.
Expert Warns:
100% Certainty of Total Catastrophic Failure
of the Entire Power Infrastructure Within 3 Years
The-Coming-Depression.blogspot.ca
As smart grid metering systems expand across the developed world, many are starting to ask whether the threats posed by the new devices, which officials promise will save energy and reduce end user utility costs, outweigh their benefits. In addition to documented health concerns resulting from radiation emissions and no cost savings being apparent, opponents of the technology argue that smart meters are violative of basic privacy rights and give the government yet another digital node of unfettered access to monitor and control personal electricity consumption.
Echoes of '67: Israel Unites
By Charles Krauthammer - PatriotPost.us
WASHINGTON -- In May 1967, in brazen violation of previous truce agreements, Egypt ordered U.N. peacekeepers out of the Sinai, marched 120,000 troops to the Israeli border, blockaded Eilat (Israel's southern outlet to the world's oceans), abruptly signed a military pact with Jordan and, together with Syria, pledged war for the final destruction of Israel.
May '67 was Israel's most fearful, desperate month. The country was surrounded and alone. Previous great-power guarantees proved worthless. A plan to test the blockade with a Western flotilla failed for lack of participants. Time was running out. Forced to protect against invasion by mass mobilization -- and with a military consisting overwhelmingly of civilian reservists -- life ground to a halt. The country was dying.
Two Prime Ministers, Two Americas
By Ken Blackwell - PatriotPost.us
Editor's Note: This column was coauthored by Bob Morrison
Winston Churchill became Prime Minister of an embattled Great Britain on May 10, 1940. At last, his political exile was over. Also that day, Adolf Hitler launched his blitzkrieg against Belgium, Netherlands and Luxemburg, and his armored panzer divisions ripped through the Ardennes forest.
Churchill had been warning against this outcome for a decade. It was Churchill, after all, who foresaw the possibilities of tank warfare in the darkest days of World War I. Surely, Churchill pleaded, there must be a better way to employ brave soldiers than having them "chew barbed wire in Flanders." ....Prime Minister Netanyahu warns us. Soon, the Iranians may have enough of their nuclear weapons program deep within mountains so they cannot be stopped in their headlong quest to dominate. Then, we will see the ultimate weapons in the hands of the ultimate terrorists.
Fukushima Threatens The Continuation of Life as We Know It
Mike Adams presents a Fukushima mega-meltdown special on the Friday, May 11 edition of the Alex Jones Show. Adams talks with Arnie Gundersen, the chief engineer of energy consulting company Fairewinds Associates and a former nuclear power industry executive. Mr. Gundersen continues to warn about the cataclysmic potential of the damaged Fukushima nuclear plant and is now warning about serious problems at the San Onofre nuclear plant in San Diego.
Faber Sees '87-Type Crash If U.S. Stocks Rise Without QE3
By Betty Liu and Corinne Gretler - Bloomberg.com
U.S. stocks may plunge in the second half of the year "like in 1987" if the Standard & Poor's 500 Index (SPX) climbs without further stimulus from the Federal Reserve, said Marc Faber, whose prediction of a February selloff in global equities never materialized.
"I think the market will have difficulties to move up strongly unless we have a massive QE3," Faber, who manages $300 million at Marc Faber Ltd., told Betty Liu on Bloomberg Television's "In the Loop" from Zurich today, referring to a third round of large-scale asset purchases by the Fed. "If it moves and makes a high above 1,422, the second half of the year could witness a crash, like in 1987."
Goldman Sachs reiterates
Gold will hit $1940/oz despite current weakness
NEW YORK (Commodity Online): Investment bank Goldman Sachs reiterated its 12-month target of $1940/oz for gold despite current indications of a sustained price weakness. The bank also maintained its six-month target of $1840/oz
In a report, the bank argues that gold still remains the currency of last resort. "In early 2009, we suggested that gold had become the currency of last resort, overtaking the U.S. dollar's status due the rising risk of sovereign default and debasement concerns. it is too early for the dollar to reclaim this status"
Gold needs to fall further to lure buyers back:
LONDON (Commodity Online): The break under $1,600 an ounce for gold may finally attract buyers to the yellow metal, freshening the recent stale price action seen lately, said Edel Tully, precious metals strategist at UBS.
Although the European sovereign debt risks, less-than-stellar U.S. economic data and removal of the Indian excise duty can spur buying, Tully says price appeal might be the biggest variable among these factors.
There was some physical buying on Tuesday, but the response wasn't heavy, suggesting buyers may want even lower prices.
Gold Takes It On the Chin…What's Next?
By Frank Holmes - GoldSeek.com
There was a strong reaction on Tuesday to the elevated debt crisis in Europe, with commodities and equities being indiscriminately sold. Gold fell 3 percent this week, losing its safe haven status as the dollar grew stronger and the 10-year government note headed lower.
The markets generally overreact to negative news, however, investors should keep in mind gold's normal monthly historical volatility. Throughout the past 20 years of monthly returns, the precious metal generally increased only 0.5 percent in May, and has historically declined in June and July.
Extraordinary delusions or the madness of machines Why gold might be setting up for a big move higher
By Michael J. Kosares - GoldSeek.com
Counter-intuitive forces are at work in the gold market. Europe is moving toward dissolution – erratically to be sure but inevitably nevertheless. Intuition tells us that gold should be moving higher under the circumstances, after all, we are talking about the beginning phases of a major currency, and perhaps economic, collapse.
But it isn't. It is headed south. To what do we owe this curiosity?
The running conflict between rational and irrational forces has become a hallmark of the times. You see, we are increasingly giving over our thought processes in the investment market-place to external trends governed by computers and automaton traders who have nearly unlimited capital reserves they can throw in the direction their algorithmic software is telling them. Thus if the algorithm says that gold goes down when the dollar goes up and that the dollar goes up when the euro goes down, then that is the reality under which we all must live – no matter what our intuitions, or intellects, might be telling us. It used to be "don't fight the tape." Now it's "don't fight the algorithm." Paper, not physical, trades are executed in the marketplace quite often without the intrusion of human contact, and thus the market proceeds as it is directed.
S&P warns of $46TRILLION refinancing challenge
By Mary Watkins in London
European companies could face serious challenges refinancing a wall of maturing debt over the next few years as the region's banks deal with the impact of regulation and fallout from the eurozone debt crisis, according to a new report from Standard & Poor's.
The rating agency predicted that companies round the world would need new funding or to refinance existing debt totalling as much as $46tn over the next five years. And while global banks and debt capital markets should largely be able to provide the majority of funding for companies, S&P raised concerns about the ability of European lenders in particular to meet all corporate funding needs as they deal with the impact of sluggish economic growth and tough regulatory requirements.
Gold settles a tad higher as European worries ease Analysts see market at standstill,
with flight-to-safety flows absent
By Claudia Assis and Laura Mandaro, MarketWatch
SAN FRANCISCO (MarketWatch) — Gold futures edged higher Thursday, with some support from a round of U.S. economic data, a reprieve in concerns over Europe's banking, and a weaker dollar, but with lack of investor interest keeping gains subdued.
Gold for June delivery GCM2 -0.24% advanced $1.30, or 0.1%, to end at $1,595.50 an ounce on the Comex division of the New York Mercantile Exchange.
"Gold is really lacking a theme in the marketplace," said Adam Klopfenstein, an analyst with Archer Financial in Chicago. It does not move higher with equities, and it has been unable to catch flight-to-safety bids, which are going to the U.S. dollar and U.S. bonds, he said.
The 2013 Fiscal Cliff Could Crush Stocks Do the math on dividend taxes.
Yields lower, stock prices lower—maybe by 30%.
By DONALD L. LUSKIN - WSJ.com
Why doesn't the stock market, that most sensitive of economic barometers, seem to care that the U.S. economy faces a "fiscal cliff" at year-end? On Dec. 31, trillions of dollars in tax cuts will expire, trillions more in new tax hikes under ObamaCare will kick in, and a trillion in automatic spending cuts will begin. Yet stock prices are the highest in four years.
Maybe with the date still far away, the fiscal cliff just doesn't seem real. It's certainly being treated that way on both sides of the political divide. On the left, economists claim with a straight face that even huge tax hikes don't matter—a top tax rate as high as 70%, they claim, would have no chilling effects on top earners' incentives. On the right, they just as solemnly claim even a small rise in the top rate for high earners from today's 35% to the 39.6% scheduled for after year-end will bring about economic ruin.
J.P. Morgan Makes $2 Billion Blunder Losses Stem From Bet Gone Wrong
By DAN FITZPATRICK And LIZ RAPPAPORT - WSJ.com
J.P. Morgan Chase & Co. has taken $2 billion in trading losses in the past six weeks and could face an additional $1 billion in second-quarter losses due to market volatility, Chief Executive James Dimon said Thursday in a hastily arranged conference call after U.S. markets closed.
The losses stemmed from derivatives bets gone wrong in the bank's Chief Investment Office, which manages risk for the New York company. The Wall Street Journal reported last month that large bets—by a London-based trader named Bruno Michel Iksil—being made in that office had roiled a sector of the debt markets.
JP Morgan Reveals Large Trading Loss; Shares Hammered
By Avi Salzman - Barrons.com
JPMorgan Chase (JPM) fell 6.5% after-hours after saying it incurred "significant mark-to-market losses in its synthetic credit portfolio."
CEO Jamie Dimon apologized on a conference call at 5 p.m. for "egregious mistakes" and an "unbelievably ineffective" trading strategy meant to hedge trading positions.
"This is not how we want to run a business."
He said the company's Corporate division was likely to post an $800 million after-tax loss, higher than its previous expectations for profits of plus or minus $200 million. JPM's chief investment office lost $2 billion on its synthetic credit positions while recording a $1 billion gain, mostly by selling credit exposures.
Volcker Rule Proponents Say JPMorgan Loss Bolsters Case
By Phil Mattingly - Bloomberg.com
U.S. lawmakers and interest groups who favor tighter restrictions on proprietary trading saidJPMorgan Chase & Co. (JPM)'s $2 billion loss on synthetic credit securities bolsters their case.
Senator Carl Levin, the co-author of the so-called Volcker rule and chairman of the Permanent Subcommittee on Investigations, said the New York-based bank's disclosure yesterday served as a "stark reminder" to regulators drafting the proprietary trading ban required by the 2010 Dodd-Frank Act.
Are the derivatives beginning to crack? Sharkboy Hits Dock -
JPM Takes 'Significant Loss' in Derivatives Book -
'Could Get Worse'
JESSE'S CAFÉ AMÉRICAIN
"The enormous loss was just the latest evidence that what banks call 'hedges' are often risky bets." -- Senator Carl Levin
After the bell JPM announced that it is taking a $2 Billion loss in its London derivatives book. The news drove down US bank stocks and the SP futures dropped a quick 12 points.
A Treasury official, speaking off the record, noted, "We may be dancing on the edge of a crevasse, but we're still better than Europe.Neener neener."
Isn't this transformation of the CIO office at JPMorgan part of Jamie Dimon's strategy to skirt curbs on proprietary trading and take very large positions in OTC derivatives in order to greatly increase bank profits?
JPMorgan Reveals $2 Billion Derivatives Loss
By Shanthi Bharatwaj - TheStreet.com
NEW YORK (TheStreet) -- JPMorgan Chase(JPM_)has suffered "significant" mark-to-market losses in its synthetic credit portfolio since the end of the first quarter, the bank revealed after the bell on Thursday.
In an highly unusual, unscheduled conference call, CEO Jamie Dimon revealed that the bank's Chief Investment Office has suffered a trading loss of $2 billion in its synthetic credit portfolio, offset by a $1 billion securities gain, as a strategy to re-hedge its portfolio backfired.
Shares of the bank were down 6% in after-market trading.
Avoiding the Next Big Bailout FDIC Would Seize Parent,
Allow Units to Operate While Mess Is Cleaned Up
By VICTORIA MCGRANE - WSJ.com
WASHINGTON—When the next crisis brings a major financial firm to its knees, U.S. regulators will seize the parent company but allow its units around the globe to keep operating while the mess is cleaned up, according to a planned announcement Thursday from the Federal Deposit Insurance Corp.
The equity stakeholders of the large bank or other financial firm will be wiped out, and bondholders will face losses as their holdings are swapped for equity in a new entity, as a part of the FDIC's plan.
Nearly four years after the massive government bailouts of the financial crisis, regulators are looking to chip away at the tacit understanding that the government will step in to save top financial institutions seen as vital to the economy or banking system.
America Lost in a Bubble
By Dr. Robert R. Owens - PatriotPost.us
All bubbles burst. This is a law of nature. No matter from what material the bubble arises. No matter what forces propel its expansion. All bubbles burst.
Actually the science of bursting bubbles has recently popped into the forefront of scientific discovery. Conventional wisdom has taught since the beginning of time that when a bubble bursts it simply vanishes. However, recent observations using high speed cameras has revealed that when a bubble bursts it leaves a circle of miniature daughter bubbles that pop so fast the eye cannot catch it. There is even the thought that each daughter bubble leaves a ring and each daughter bubble leaves a ring ad infinitum. All happening so fast it cannot be seen. And yet, each succeeding bubble bursts.
Banks are healing, Bernanke says
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) — The banking sector is healing and has become more resilient but does not yet have a clean bill of health, Federal Reserve Board Chairman Ben Bernanke said Thursday.
"Conditions in the banking system — and the financial sector more broadly — have improved significantly in the past few years," Bernanke said in a speech to an industry conference sponsored by the Chicago Federal Reserve Bank.
"Nonetheless, banks still have more to do to restore their health and adapt to the post-crisis regulatory and economic environment," he said.
Goldman Sachs May Owe $2.21 Billion
If Rating Falls Two Levels
By Christine Harper - Bloomberg.com
Goldman Sachs Group Inc. (GS), one of the five U.S. banks with the biggest positions in over-the-counter derivatives, may owe counterparties $2.21 billion if its credit rating falls two levels.
Counterparties could demand the money in collateral and termination payments, the New York-based bank said in a quarterly filing today. A one-level reduction would require $1.33 billion in payments, according to the filing.
Breaking Up Four Big Banks
By SIMON JOHNSON - NYTimes.com
Almost exactly two years ago, at the height of the Senate debate on financial reform, a serious attempt was made to impose a binding size constraint on our largest banks. That effort — sometimes referred to as the Brown-Kaufman amendment — received the support of 33 senators and failed on the floor of the Senate.
On Wednesday, Senator Sherrod Brown, Democrat of Ohio, introduced the Safe, Accountable, Fair and Efficient Banking Act, or SAFE Banking Act, which would force the largest four banks in the country to shrink. (Details of this proposal, similar in name to the original Brown-Kaufman plan, are in this briefing memo for a Senate banking subcommittee hearing on Wednesday, available through Politico, and in this news release).
One Fed President is Worried About Inflation
247WallSt.com
In a speech today to the Economic Club of Minnesota, Minneapolis Federal Reserve Bank President Naryana Kocherlakota reviewed the Fed's new transparency policies (he supports them) and then reviewed the Fed's role in maintaining "maximum" US employment. Keeping prices stable and maintaining maximum employment are the dual mandates of the US Fed.
Kocherlakota supports the bank's increased transparency initiatives:
A transparent central bank is more accountable to the public because it is forced to be more disciplined in ensuring that its policy actions are in fact consistent with its policy objectives. When performance matches words, the public will have an even stronger belief in the central bank, which serves to anchor inflation expectations more solidly.
Spanish Banks Erode Creditors With ECB Loans: Mortgages
By Esteban Duarte - Bloomberg.com
Spain's lenders are pledging some of their best assets to raise record levels of secured funding, including from the European Central Bank, eroding creditor safeguards at the same time the government is planning the country's largest bank bailout.
Borrowing from the ECB rose 50 percent in March from the prior month to 227.6 billion euros ($294.3 billion). Bankia Group is among lenders that increased mortgage-backed debt issuance by 35 percent since December 2007 to 535.1 billion euros, or 53 percent of their real-estate loans, according to Spanish Mortgage Association data at the end of 2011. Rodrigo Rato, Bankia chairman, stepped down this week as part of a plan in which the government is willing to inject public funds.
Spain's lingering bank crisis weighs on economic recovery
By Howard Schneider - WashingtonPost.com
MADRID — Like many of the immigrants who flocked to Spain not long ago, Klever Cordova was enticed by the prospect of easy employment and easy credit — the chance to leave behind the troubled economy of his native Ecuador and become a homeowner in a booming euro-zone country.
That was six years ago, before the collapse of the miracle that was the Spanish real estate market and the country's slide into economic hardship. His job as a highway construction worker is long gone, and his $300,000 mortgage is now one more bit of straw in a load of bad debt that is weighing down Spain's banks, undermining hopes of an economic recovery and raising new perils for the global financial system.
Greece Strives for Government After Election Raises Doubt
By Maria Petrakis, Natalie Weeks
and Marcus Bensasson - Bloomberg.com
Greece's political leaders go into a fifth day of talks today to carve out a government withEvangelos Venizelos, the socialist Pasok leader, set to press counterparts on a proposal for a unity government that would avert a new election.
Venizelos, who received the mandate to form a government yesterday, said there was a first "good omen" since the inconclusive May 6 election, after Democratic Left leader Fotis Kouvelis outlined a proposal designed to keep the country in the euro area.
Greeks May Hold $510 Billion Trump Card in Renegotiation
By John Glover - Bloomberg.com
Greece's next government may hold a trump card worth more than $510 billion if it heeds voters' demands to renegotiate its bailout with the European Union.
The nation owes about 400 billion euros ($517 billion) to private bondholders, public bodies such as the International Monetary Fund and European Central Bank, and other creditors, according to data compiled by Bloomberg. About 252 billion euros of that's due to official organizations that used their status to avoid the losses suffered by ordinary bondholders when Greece restructured its debt two months ago.
Europe's Voters Say 'No' to Economic Reality
BY DETLEV S SCHLICHTER - FinancailSense.com
"Europe fights back against austerity" was how The Daily Telegraph headlined its weekend election coverage. "Anti-austerity movements are gathering pace across Europe following political earthquakes in France and Greece. A total of 12 European governments have now been dismissed in three years."
As the European welfare state is officially in its death-throes none of us should be surprised if political strife gets cranked up to eleven. I firmly expect that we will see much more of this in the future. While I can understand the anger of the electorate and sympathize with the sense of desperation and foreboding, I can, however, not consider the electoral choices of the weekend particularly enlightened, and I do not think that they reflect a coherent, let alone intelligent strategy as the Daily Telegraph headline seems to imply. If those who 'won' the election deliver on their promises, economic disintegration will only accelerate. What is being offered in terms of 'solutions' is a dangerous assortment of economic poisons, more suitable to describe the European disease than provide a recipe for stronger growth.
Reinventing NATO
By Karl-Heinz Kamp - Project-Syndicate.org
ROME – This month, NATO will hold its next summit in Chicago. Unlike European Union summits, which take place almost monthly, NATO's are infrequent. This helps to explain the inflated rhetoric that surrounds them: the November 2010 summit in Lisbon, for example, was described as nothing less than "the most important in NATO's history." Will the Chicago summit prove to be an exception to this rule?
For a while, that seemed likely, with the meeting initially billed as an "implementation summit," at which NATO's political leaders would focus on assessing the progress of the ambitious agreements reached in Lisbon. But four political developments that have modified the international security agenda are likely to transform Chicago into a high-profile summit in its own right.
Stimulus Spending Keeps Failing If austerity is so terrible,
how come Germany and Sweden have done so well?
By ROBERT J. BARRO - WSJ.com
The weak economic recovery in the U.S. and the even weaker performance in much of Europe have renewed calls for ending budget austerity and returning to larger fiscal deficits. Curiously, this plea for more fiscal expansion fails to offer any proof that Organization for Economic Cooperation and Development (OECD) countries that chose more budget stimulus have performed better than those that opted for more austerity. Similarly, in the American context, no evidence is offered that past U.S. budget deficits (averaging 9% of GDP between 2009 and 2011) helped to promote the economic recovery.
Moody's issues capital warning to global banks
Creditworthiness at risk as debt levels rebuilt
By Tracy Alloway and Tom Braithwaite in New York - FT.com
Moody's has warned that the tendency of global banks to avoid new capital requirement rules and load up on debt will continue to put pressure on their creditworthiness.
The credit rating agency announced it was placing 17 banks on review for a downgrade earlier this year, citing "vulnerabilities" in the companies' vast and volatile capital markets businesses.
How Wall Street Killed Financial Reform
It's bad enough that the banks strangled the Dodd-Frank law. Even worse is the way they did it - with a big assist Congress and the White House.
By MATT TAIBBI - RollingStone.com
Two years ago, when he signed the Dodd-Frank Wall Street Reform and Consumer Protection Act, President Barack Obama bragged that he'd dealt a crushing blow to the extravagant financial corruption that had caused the global economic crash in 2008. "These reforms represent the strongest consumer financial protections in history," the president told an adoring crowd in downtown D.C. on July 21st, 2010. "In history."
This was supposed to be the big one. At 2,300 pages, the new law ostensibly rewrote the rules for Wall Street. It was going to put an end to predatory lending in the mortgage markets, crack down on hidden fees and penalties in credit contracts, and create a powerful new Consumer Financial Protection Bureau to safeguard ordinary consumers. Big banks would be banned from gambling with taxpayer money, and a new set of rules would limit speculators from making the kind of crazy-ass bets that cause wild spikes in the price of food and energy. There would be no more AIGs, and the world would never again face a financial apocalypse when a bank like Lehman Brothers went bankrupt.
Bernanke Speaks About Risks From End of Pro-Growth Plans
By Joshua Zumbrun, Laura Litvan and Kathleen Hunter - Bloomberg.com
Federal Reserve Chairman Ben S. Bernanke spoke to a group of senators today about the potential harm to the economy from the expiration of several pro-growth policies, according to senators who attended the meeting.
Bernanke discussed the scheduled end of programs including the Bush tax cuts, the payroll tax holiday and extended unemployment benefits, as well as budget cuts that are set to take effect in January of 2013, said Kent Conrad, a North Dakota Democrat.
House shifts pending budget cuts
from defense to entitlements Republicans press for alternative to debt deal
By Stephen Dinan - The Washington Times
Six months after the congressional supercommittee failed to come to a long-term deal on federal spending, House Republicans reignited the debate Thursday by passing legislation that would stop looming defense cuts and instead cut hundreds of billions of dollars from entitlement programs.
The legislation, passed on a 218-199 vote, is unlikely to advance beyond the House. TheSenate hasn't shown any interest in holding a budget debate this year, and the White Housesaid President Obama likely would veto the House bill if it reaches his desk.
Feds pick legal fight with Sheriff Arpaio Arizona lawman won't 'surrender'
By Jerry Seper-The Washington Times
The Justice Department, which first targeted Sheriff Joe Arpaio four years ago over his handling of illegal immigrants arrested in the Phoenix area, filed a civil lawsuit in federal court Thursday accusing the sheriff and his office of "unconstitutional and unlawful actions" against Hispanics.
The complaint, which says the Maricopa County Sheriff's Office and Sheriff Arpaio abuse Hispanic inmates and engage in ethnic profiling, produced a flurry of charges and countercharges Thursday, in which the sheriff accused federal bureaucrats of trying to usurp his power as an elected official and the top Democrat in Congress applauded the lawsuit.
The globalists WANT this pipeline built... 'Great progress' on including Keystone pipeline in highway bill
By Ben Geman - TheHill.com
A top member of the House-Senate team forging a compromise transportation bill sounded optimistic notes Thursday about including construction of the Keystone XL oil pipeline in the measure.
"I think the Keystone pipeline is making great progress from what I have heard ... as far as its acceptance into what we may do as a final bill," said Rep. John Mica (R-Fla.), the chairman of the House Transportation and Infrastructure Committee.
The House-approved version of the transportation programs funding bill includes a provision for construction of TransCanada Corp.'s proposed pipeline to bring Canadian oil sands to Gulf Coast refineries.
Obama's Soros-Controlled Energy Council
By Ken Blackwell - Townhall.com
When politicians want to look busy while avoiding tough decisions during an election year, what do they do? They form commissions and councils.
And when President Barack Obama saw Americans struggling with higher gasoline and home energy prices, did he encourage more domestic oil exploration, off-shore drilling, or coal production, while lowering taxes on energy? Of course not. After all, with political observers expecting a close presidential race this year, Obama needs the financial and institutional support far-left environmental groups. The result has been the President anointing certain energy sources - such as wind and natural gas - as energies of the future, while implementing regulatory hurdles for more dependable fuels like oil and coal.
A Tale of Two Stocks and Two Economies
BY CLIF DROKE - FinancialSense.com
The government recently reported that the U.S. economy grew at an annual rate of 2.2 percent, below the expected 2.5 percent rate. The jobless rate has declined, but mainly because so many job seekers have given up in their search for a job. The economic recovery, in other words, isn't as strong as it appears on the surface.
The recovery to date since March 2009 has mainly been a product of loose monetary policy and the subsequent surge in the profits of corporations with global exposure. While a few domestic industries have done well (e.g. the auto industry), many others have struggled, including the pivotal housing construction industry.
A Monster Real Estate Paradigm Shift
Demands A New Direction for Capital
By Michael Messner - Forbes.com
Things have changed. All across America powerful Schumpeterian gales of technological creative destruction, along with acute aftershocks from the 2008 financial crisis, are radically and quite literally altering the physical landscape of this nation.
We are witnesses and participants to a perfect storm of enormous and unstoppable trends triggered by the Internet, by Americans downsizing their lifestyles and increasing their savings, and of dynamic technology displacing capital intensive, asset-oriented investments. As a result of this sweeping sea change, we face a trillion dollar glut of commercial property threatening our communities, businesses, hundreds of small and mid-sized banks, as well as the FDIC.
Unpaid Internships: Bad for Students,
Bad for Workers, Bad for Society
By Derek Thompson - TheAtlantic.com
The economics of unpaid internships are obvious. Employers are desperate for cheap work, and "free" is pretty cheap. Workers are desperate for, well, anything, and students and recent grads are willing to negotiate their wages down to zero. But the ethics aren't so clear-cut. If unpaid internships are the key to better jobs and bigger salaries, should we be concerned about the millions of lower-class students who can't afford to work for free?
Yesterday, I asked you to tell me your experiences and opinions about unpaid internships. Hundreds of you responded. Here is the first batch of answers -- against unpaid internships. Forthcoming today: in defense of working for free.
F-22 Raptor pilots make problems public
By Rowan Scarborough-The Washington Times
The Air Force late last month convened a summit in Ohio to address the most vexing problem of its premier jet fighter - pilots becoming dizzy from oxygen deprivation while flying the supersonic F-22 Raptor.
Scientists, manufacturers and Raptor pilots at Wright-PattersonAir Force Base brainstormed on why aviators - 25 to date - are returning from missions suffering from hypoxia, or oxygen deprivation.
"It was an update on where we were at," said Lt. Col. Tadd Sholtis, a spokesman for the Air Force Air Combat Commandat Langley Air Force Base. "We're kind of closing in on some ideas."
Egyptian Preacher Calls for Caliphate
With Jerusalem as Capital
theTrumpet.com
Aradical Muslim preacher told thousands of Muslim Brotherhood supporters that Jerusalem should be the capital of an Islamic caliphate, in a video clip released Monday.
Safwat Higazi, speaking at a Cairo soccer stadium, said: "We can see how the dream of the Islamic caliphate is being realized, God willing, by Dr. Mohamed Mursi"—the Muslim Brotherhood presidential candidate. Brotherhood officials nodded in agreement.
"The capital of the caliphate—the capital of the United States of the Arabs—will be Jerusalem, God willing," Higazi continued. "Our capital shall not be in Cairo, Mecca or Medina." He then led the crowd in chanting, "Millions of martyrs march toward Jerusalem."
U.S. launches airstrike in Yemen
as new details surface about bomb plot
By Greg Miller and Karen DeYoung - WashingtonPost.com
The United States launched airstrikes in Yemen on Thursday that killed as many as seven militants, the second American missile attack in the country since the CIA and other spy agencies disrupted an al-Qaeda airline bomb plot, U.S. officials said.
The strike came as new details surfaced about the foiling of the plot, including the disclosure that the operative who posed as a willing suicide bomber and later turned the device over to authorities was a British citizen, according to Western officials.
L.A. Marzulli - Aliens and the Great Deception
inteview on Coast to Coast AM
"Researcher L.A.Marzulli discusses how a recent string of events validates notions of a coming great deception, as foretold in ancient prophecies. He cited the Myanmar cyclone, the Chinese earthquake, and other natural disasters, along with the Middle East tensions as being indicators that we're living in the time prophesied by Ezekiel, and in the Book of Revelation.
Natural disasters are up more than 400% in the last two decades, he noted. Book of Revelation writes about a one-world government and religion, as well as the mark of the beast. Marzulli suggested that a terrorist attack involving suitcase nukes might be used as a pretext for people to get microchipped for alleged security reasons (the chip would be the mark that is prophesied).
He believes that a war in the Middle East will be a supernatural trigger, leading to the appearance of huge spaceships (1-3 miles wide) in the skies. The ETs (who are actually fallen angels) will claim to be the progenitors of humankind and religion-- but this is the great Luciferian deception, designed to get everyone united in a one-world govt./religion, he detailed."
Fed clears China's first US bank takeover
By Veronica Smith (AFP)
WASHINGTON — The United States on Wednesday opened its banking market to ICBC, China's biggest bank, for the first time clearing a takeover of a US bank by a Chinese state-controlled company.
Just days after high-level US-China economic talks in Beijing, the Federal Reserve approved an application from Industrial and Commercial Bank of China to buy a majority stake in the US subsidiary of Bank of East Asia.
The transaction will make ICBC the first Chinese state-controlled bank to acquire retail bank branches in the United States.
ICBC has been the most aggressive of China's "big four" banks in expanding overseas.
According to the Fed the bank has total assets of roughly $2.5 trillion.
IDAHO CONSTITUTIONAL MONEY ACT OF 2012
By Idaho State Rep., Phil Hart - NewsWithViews.com
Last week the House State Affairs Committee of the Idaho Legislature sent to the amending order a Sound Money bill. This bill is called the "Idaho Constitutional Money Act of 2012." The purpose of the bill is to remove barriers and provide statutory authority for those in Idaho who may choose to do business with gold and silver coin. The bill will declare gold and silver coins currently minted by the United States Mint as legal tender in Idaho.
The authority to conduct business in gold and silver coin already exists at the federal level in the United States Code. You can find the statute at 31U.S.C. 5118 (d)(2). What I am sure some will find surprising is that our states are required to do business in gold and silver coin as mandated by the United States Constitution.
GDP Growth: The Civic Duty of Every US Consumer
By Bill Bonner - DailyReckoning.com
05/09/12 Baltimore, Maryland – No panic on Wall Street — yet. Gold still over $1,600.
But watch out. Our hunch is that when people come to their senses…they will run for the exits.
Europe's shifting from austerity to "growth"…which really means more debt.
America's growth is phony — with fewer jobs today than when the '08 recession began.
More people are below the poverty line. More people on food stamps. And more people so broke they can't even go broke. CNN Money reports:
This year, hundreds of thousands of Americans are expected to be too broke to file for bankruptcy.
The average cost to file for Chapter 7 bankruptcy protection, the most common form of consumer bankruptcy, is more than $1,500, according to recent research submitted to the National Bureau of Economic Research.
The 'Secret Bank Bailout' Is Neither Secret Nor a Bailout
By Matthew O'Brien - TheAtlantic.com
Free money for banks and not-so-free money for everybody else isn't such a crowd-pleaser.
In fact, it seems like welfare for the wealthy. It doesn't take much financial acumen to make a profit when you can get money for nothing from the Fed and lend it back to the government for a few hundred basis points. How can normal people get in on this? That's what former FDIC chief Sheila Bair asked in a recent tongue-in-cheek piece calling for the Federal Reserve to give everyone interest-free $10 million loans.
But there is nothing special about zero interest rates.
BANKING GIANT HSBC 'A CRIMINAL ENTERPRISE'
By Jerome R. Corsi - WND.com
The global banking giant HSBC is a "criminal" operation, charges a former officer for the company's southern New York region in a video interview with WND.
John Cruz, a former vice president and relationship manager, has turned over to WND more than 1,000 pages of documents, including customer account ledgers for dozens of companies through which, he charges, the financial institution was laundering money each month.
11 Quotes That Show How Worried
The Financial World Is About Europe Right Now
By Michael Snyder - TheEconomicCollapseBlog.com
The recent elections in France and in Greece have thrown the global financial system into an uproar. Fear and worry are everywhere and nobody is quite sure what is going to happen next. All of the financial deals that Greece has made over the past few years may be null and void. Nobody is going to know for sure until a new government is formed, and at this point it looks like that is not going to happen and that there will need to be new elections in June. All of the financial deals that France has made over the past few years may be null and void as well. New French President Francois Hollande seems determined to take France on a path away from austerity. But can France really afford to keep spending money that it does not have? France has already lost its AAA credit rating and French bond yields have started to move up toward dangerous territory. And Greek politicians are delusional if they think they have any other choice other than austerity. Without European bailout money (which they won't get if they don't honor their current agreements), nobody is going to want to lend Greece a dime.
....#6 Art Cashin: "Here's the outlook on Greece from Wall Street watering holes. If a coalition government is formed or looks to be formed, global markets may rally. Any coalition is unlikely to make progress on goals, since austerity is political suicide. There will likely be another election around June 10/17. A workable majority/plurality remains unlikely, so back to square one. Therefore, Greece will be unable to attain goals by the deadline (June 30). Lacking aid funds, pensions are suspended and government workers are laid off. Protestors take to the streets and government is forced to revert to drachma to avoid social chaos. Pass the peanuts, please."
"Europe Has Started The Endgame"
And Biderman Says "The US Is Next"
Submitted by Tyler Durden - ZeroHedge.com
Charles Biderman (CEO of TrimTabs) is not shocked that "Europeans who have been getting something for nothing, want to continue getting something for nothing" as they chant that Austerity is evil. Charles provides context for the revolt that the Europeans find themselves fulfilling as he looks back at how they/we got here. Briefly covering the key aspects of the last 25 years, of why and how various parabolic growths (be it stocks, real estate, the internet, or debt) have led us to believe we "deserve something for nothing"; he vehemently argues that the European mess will not resolve itself until the fundamental belief that we all deserve to be taken care of from cradle-to-grave dissolves. In one of his best rants, the BLS-belittler explains how Europe has started the endgame and why the end of this year could well see the US move front-and-center in the crisis. Harsh but fair, in a little under 4 minutes, summarizes all that is wrong with societal values and suggests catalysts for next steps - dismal next steps.
Spain nationalises Bankia as euro crisis escalates Spain has nationalised crippled lender Bankia in a dramatic move to contain the esalating crisis and restore faith in the country's management.
By Ambrose Evans-Pritchard - Telegraph.co.uk
The forced rescue was ordered by premier Mariano Rajoy after auditors Deloitte refused to sign off the bank's books, amid allegations of €3.5bn (£2.8bn) of inflated assets. Half of the bank's €37bn of property exposure is deemed "problematic" by regulators.
The lender has asked for €4.5bn in loans, converting the cash into ordinary shares. The Spanish government holding 45pc of the bank in return. Bank of Spain has also demanded Bankia dispose of assets as part of the rescue.
Corruption report highlights
political party funding in EU countries
BY NIKOLAJ NIELSEN - EUObserver.com
BRUSSELS - European nations are not doing enough to fight corruption and bribery, according to an annual report released on Wednesday (9 May) by the Council of Europe (CoE). In the EU alone, corruption costs an estimated €120 billion annually.
The CoE's group of states against corruption (Greco), which acts as a peer review system producing reports and recommendations on different aspects of each member's efforts to fight corruption, says members need to increase transparency of political funding.
China props up the Euro China, ECB, odd bedfellows in the euro's resilience Commentary: Interest-rate differentials are key
By Michael Casey
NEW YORK (MarketWatch) — To volatility-loving currency traders, the euro has been a source of great frustration, its trade versus the dollar hewing to a boring range of 4 cents for almost four months.
For that they can blame an unintentional symbiosis between the European Central Bank and the People's Bank of China, the first via its stubbornly hands-off view of markets, the latter for being hyper-interventionist.
Iran could Avoid Economic Blow
of US Sanctions by Accepting Chinese Yuan
By Daniel J. Graeber - OilPrice.com
The Iranian currency shuffle continued again this week as Tehran announced it would take the Chinese yuan as payment for crude oil deliveries from its trading partner in Beijing. While the U.S. secretary of state was in New Delhi convincing one of Tehran's more faithful clients to back away from Iranian crude, Iranian officials were warming to the yuan to process the roughly $20 billion worth of crude oil it sells to China every year. Deadlines for Iranian sanctions are fast approaching, but in a global economy still fueled by petroleum, customers may turn to gold if they need to in order to keep Iranian crude oil flowing.
U.S. and European sanctions targeting Iran go into force this summer. Earlier, in March, Washington gave exemptions to 10 members of the European Union and Japan for their decisions to cut back on Iranian crude oil. Secretary of State Hillary Clinton, during her visit to India this week, welcomed a move by India to reduce its crude oil purchases from Iran. India gets about 80 percent of its crude oil through imports and, with its economy expanding by a rate of roughly 7 percent, moving away from any source of oil is a significant move.
How Bailouts Encourage Bad Behavior
By Eric Fry - DailyReckoning.com
05/08/12 Laguna Beach, California – Greece returned to Europe's center stage this morning…and almost no one was happy about it. Most investors were pretty content when this "Debbie Downer-opoulos" of the European financial markets disappeared behind the curtains for a while.
But Debbie took the stage again Sunday when the left-wing Syriza party gained a surprisingly large number of seats in Parliament. The leftists hope to form a coalition government that would nationalize banks, repeal recent labor reforms and immediately cancel the bailout accords with the European Union and the IMF.
Europe signals openness
to relaxing Greek timetable, lowering loan rates
By Michael Birnbaum - WashingtonPost.com
BERLIN — As another day passed with Greece no closer to a working government, European officials suggested Wednesday that they had a new tool in their mission to keep the shared euro currency with all its partners: time.
A ticking watch may be the most powerful bargaining chip Europe has against the possibility that anti-bailout voices in Greece will push it off the euro. Every day that ends without new European bailout money for Greece to pay its bills heightens the pressure on its leaders to comply with the austerity measures that come as a condition of the $171 billion rescue package.
Europe's delusional search for growth More than three years have passed since the Bank of England embarked on the emergency measure of quantitative easing.
By Jeremy Warner - Telegraph.co.uk
At the time, it was considered very much a one-off. Nobody knew whether it would work, or indeed how it would work, but something had to be done to counter the collapse in money supply and credit.
Few would have imagined, even back then in the depths of the banking crisis, that all this time later it would still be going. Nor would they have thought it so ineffective. Despite the Bank's actions in buying up nearly a third of the gilts market, the economy remains flat on its back, a pale shadow of its pre-crisis self. The best that can be said of QE is that things might have been even worse without it.
IMF tells Germany to do more for eurozone
BY VALENTINA POP - EUObserver.com
BRUSSELS - Germany's economy is doing well in its recovery, but the country should be more "active" in helping the rest of the eurozone cope with the crisis, the International Monetary Fund has said.
"As the euro area's largest economy, Germany can play a pivotal role in addressing the challenges posed by the crisis. Articulating more clearly the Economic and Monetary Union's shared vision of an appropriate post-crisis architecture will help in restoring market confidence," the Washington-based body said in a country report published on Tuesday (8 May).
Pimco's Gross Cuts Emerging Debt as IMF Sees Slowdown
By Wes Goodman and Susanne Walker - Bloomberg.com
Bill Gross, who runs the world's biggest bond fund, cut his holdings of emerging-market debt to a two-year low, selling assets from an area where growth is forecast to slow by the International Monetary Fund.
Gross reduced emerging-market debt to 7 percent of assets in Pacific Investment Management Co.'s Total Return Fund (PTTRX) in April from 10 percent in March, according to Newport Beach, California-based Pimco's website. He trimmed investment-grade bonds to 13 percent from 14 percent. Treasuries were 31 percent of holdings, versus 32 percent in March, the report showed.
Putin won't attend G8 meeting
By Dave Boyer - The Washington Times
President Obama will have to wait a little while longer to ask Russian President Vladimir Putin for more "flexibility" on missile-defense talks.
Mr. Putin, who began a new six-year term as president Monday, told Mr. Obama in a telephone call Wednesday that he won't attend the Group of Eight meeting of world leaders at Camp David on May 18 and 19. Russia is also sitting out a two-day NATO summit in Chicago beginning May 20
A Chinese Group Plans To Construct
A 200 Acre "China City" In Michigan
By Michael Snyder - EndOfTheAmericanDream.com
A Chinese group known as "Sino-Michigan Properties LLC" has bought up 200 acres of land near the town of Milan, Michigan. Their plan is to construct a "China City" with artificial lakes, a Chinese cultural center and hundreds of housing units for Chinese citizens. Essentially, it would be a little slice of communist China dropped right into the heartland of America. This "China City" would be located about 40 minutes from both Detroit and Toledo, and it would be marketed to Chinese business people that want to start businesses in the United States. Unfortunately, this is not just an isolated incident. In fact, Chinese companies have been buying up land and businesses all over the country in recent years. There has even been talk of establishing "special economic zones" inside the United States modeled after the Chinese city of Shenzhen. It was inevitable that the Chinese were going to do something with the trillions of dollars that they have made flooding our shores with cheap products. Now they are rapidly buying up pieces of America, and many of our politicians are welcoming them with open arms.
Postal Service to keep rural post offices open
By Hope Yen - WashingtonTimes.com
WASHINGTON — The financially struggling U.S. Postal Service sought Wednesday to tamp down concern over wide-scale cuts, revealing it will seek to keep thousands of rural post offices open with shorter hours.
At a news briefing, Postmaster General Patrick Donahoe said the mail agency was backing off its plan to close up to 3,700 low-revenue post offices sometime after May 15. Citing strong community opposition, Donahoe said the agency will now whittle down full-time staff but maintain a part-time post office presence in rural areas, with access to retail lobbies and post office boxes.
IRS paid for employees' real estate classes
By Stephen Dinan - WashingtonTimes.com
The IRS paid for employees to take course in real estate or Japanese and Mandarin language classes as part of its continuing-education benefit program, according to an audit that found the agency wasn't doing a good enough job of checking what it was paying for.
The program was designed to help retain quality employees by offering tuition assistance for those looking to update their work-related skills, but over the last four years it has sent more than $700,000 to non-accredited institutions, according to the Treasury Department's inspector general for tax administration.
US student loan crisis-
On the Edge with Max Keiser-05-04-2012
In this edition of the show Max interviews Paul Craig Roberts, former US treasury official. He talks about the US student loan crisis, where the student debt has passed one trillion dollars but 50 percent of the young graduates are either jobless or under-employed. Paul Craig Roberts is an economist and a columnist for Creators Syndicate. He served as an Assistant Secretary of the Treasury in the Reagan Administration earning fame as a co-founder of Reaganomics.
Unemployment Numbers Scam
By Arnold Ahlert - PatriotPost.us
Terrible April economic figures disappoint — but what statistical gimmicks hide is even bleaker.
When the jobs data were released last week, it was revealed that only 115,000 new jobs were created, well below the 165,000 predicted by the media-anointed economic "experts," and significantly below the 125,000 jobs-per-month pace required just to keep pace with the number of people entering the work force. Yet in an apparent paradox, the unemployment rate dropped from 8.2 percent to 8.1 percent. Presumptive Republican presidential candidate Mitt Romney explains half of it. "There is something about that 8.1 percent figure you ought to know," he told a crowd at a town hall-style meeting in Cleveland yesterday. "You might assume that that number came down from 10 percent to 8.1 percent because of all the jobs that were created, and that assumption would be wrong. The reason that percent came down was because of all the people that dropped out of the workforce."
7th Circuit Orders Injunction
Against Illinois Ban on Recording Cops
Jacob Sullum - Reason.com
Today the U.S. Court of Appeals for the 7th Circuitordered a preliminary injunction barring Cook County from enforcing the Illinois Eavesdopping Act against "people who openly record police officers performing their official duties in public." The law, the strictest of its kind in the country, makes such recording a Class 1 felony, punishable by four to 15 years in prison. Responding to a lawsuit by the American Civil Liberties Union of Illinois, which wants to monitor police behavior without fear of arrest, a three-judge panel of the appeals court said:
The Illinois eavesdropping statute restricts a medium of expression commonly used for the preservation and communication of information and ideas, thus triggering First Amendment scrutiny. Illinois has criminalized the nonconsensual recording of most any oral communication, including recordings of public officials doing the public's business in public and regardless of whether the recording is open or surreptitious. Defending the broad sweep of this statute, the State's Attorney relies onthe government's interest in protecting conversational privacy, but that interest is not implicated when police officers are performing their duties in public places and engaging in public communications audible to persons who witness the events. Even under the more lenient intermediate standard of scrutiny applicable to content-neutral burdens on speech, this application of the statute very likely flunks. The Illinois eavesdropping statute restricts far more speech than necessary to protect legitimate privacy interests; as applied to the facts alleged here, it likely violates the First Amendment's frees peech and free-press guarantees.
Fed officials at odds on jobs outlook
By David Bailey
(Reuters) - The U.S. Federal Reserve should consider raising interest rates as soon as this year, one top Fed official said on Wednesday, even as another warned it will take years at current growth rates before the economy regains full employment.
The differing views, from Minneapolis Fed President Narayana Kocherlakota and Cleveland Fed President Sandra Pianalto, show how the jobs outlook lies at the heart of disagreement at the Fed over how long the Fed should keep rates near zero, as it has since December 2008.
Should You Need the Government's Permission to Work?
License to Work: A National Study of Burdens from Occupational Licensing is the first national study to measure how burdensome occupational licensing laws are for lower-income workers and aspiring entrepreneurs.
The report documents the license requirements for 102 low- and moderate-income occupations — such as barber, massage therapist and preschool teacher — across all 50 states and the District of Columbia. It finds that occupational licensing is not only widespread, but also overly burdensome and frequently irrational.
Google, Facebook and Twitter
silent about FBI push to wiretap online
RepublicHeritage.com
The FBI is quietly working to require Google, Facebook, Twitter and other online giants to make it easier for federal law enforcement to wiretap their websites. And major tech companies have been silent on the issue so far.
As more communication moves from telephone wires to the online space, the FBI has growing concerns about the imminent prospect of not being able to surveil American citizens. So the agency has been working quietly behind the scenes to amend a federal wiretapping law, the 1994 Communications Assistance for Law Enforcement Act, to legalize and facilitate monitoring Americans on social networks, through web-based email, and in Voice over IP (VoIP) communications, CNET reported Friday.
North Carolina's Amendment One: A problem for Obama
by Angelique Christina - WashingtonTimes.com
LAS VEGAS, Nev., May 9, 2012 — A proposed amendment to North Carolina's constitution outlawing same-sex marriages passed overwhelmingly in a statewide vote.
With all counties reporting last night, North Carolina Amendment One passed with 61% of North Carolina voters in favor. The result has many people concerned. Not the least of these would be President Obama and his campaign team.
The political significance of the North Carolina vote was made especially acute by Vice President Joe Biden's comments last week, in which he warmly supported the right of same-sex couples to marry. This stood in stark contrast to Obama's evolving silence on the subject. Obama has said in the past that he supports civil unions for same-sex couples, but does not believe that marriage is a civil right.
Colo. lawmakers reach impasse on civil unions
By Ivan Moren - AP - WashingtonTimes.com
DENVER (AP) — Chants of "Shame on you" from gay rights supporters thundered through theColorado House on Tuesday night after Republican House Speaker Frank McNulty said legislation to allow civil unions would not get a vote.
Mr. McNulty told reporters that lawmakers had reached an impasse and civil unions would die along with several other bills, including an overhaul of school discipline policies and setting a blood-level marijuana limit for drivers.
"We have reached an impasse," Mr. McNulty said. "It is unfortunate that there will be items that will not receive consideration by the House tonight because of this impasse."
Colorado's debate came as gay rights are in the national spotlight.
The Case for Ron Paul's Agents of Chaos Fighting the GOP establishment for influence is the only chance they have of drawing attention to their issues at convention time.
By Conor Friedersdorf - TheAtlantic.com
Reflecting on the indefatigable Ron Paul supporters who are still trying to win delegates at various state GOP conventions, Doug Mataconis writes, "By and large, it appears pretty clear that they are antagonizing mainline Republicans every time they pull this stunt. That's hardly the kind of thing that will win friends and influence people, nor is it the kind of thing you should do if you want to become a voice of influence in the Republican Party as Paul supporters claim that they do."
I suspect he's wrong.
The Tea Party started antagonizing mainline Republicans as soon as it came onto the scene. In the course of gaining influence, it ridiculed the GOP establishment, denounced long-serving GOP officials, and otherwise acted as an agent of chaos. The 2012 Republican presidential primary showed the weaknesses of the Tea Party approach. Many think the movement is now exhausted. But for all its shortcomings, it managed to gain more influence in the GOP than have libertarians.
"Disguise thyself as thou wilt, still, Slavery," said I, "still thou art a bitter draught." -Laurence Sterne, The Passport
Tennessee passed a resolution, HJR 587, condemning the destructive and insidious nature of the United Nations' Agenda 21 and reject any affiliated radical policies and any grant monies attached to it. Regretfully, this is a resolution and as such has no teeth; a waste of time considering the 20th anniversary of Agenda 21 is in June when the globalists hope to make A21 hard law. Proponents say that it at least educates the legislators and the people about Agenda 21 and its inherent evils. Much more than a day late and a dollar short.
Also in this legislative session, Bill HB 3571 was proposed which would prohibit the state, counties, towns, and cities from implementing programs of, expending money for, receiving funding from, or contracting with the International Council for Local Environmental Initiatives (ICLEI), also known as ICLEI -- Local Governments for Sustainability. Bill SB 3407 would also prohibit the state, counties, towns, and cities from implementing programs of, expending money for, receiving funding from, or contracting with ICLEI." [link] But these two bills have been shelved for another year.
OBAMA'S PLAN TO DESTROY THE REPUBLIC
By Erik Rush - WND.com
On April 23, Doug Hagmann exposed Canada Free Press readers to the theory that simmering social unrest in America and (to a slightly lesser extent) across the globe is "not due to Obama's inexperience or failed policies. Rather, it is the direct result of the implementation of his successful policies."
I've been saying this for some time, but I was still gratified to hear Hagmann say it, and that his column and May 7 followup piece gleaned significant exposure. Attributing his information to an anonymous insider, Hagmann outlines how the Obama administration is covertly utilizing prominent agitators among the political left to incite chaos, and eventually violence, based on racial and class factors, while the administration continues to sabotage America's economic engine. The latter efforts are also intended to catalyze widespread civil unrest.
Smart-Meter Defiance Slows $29 Billion U.S. Grid Upgrade
By Mark Chediak - Bloomberg.com
A growing consumer backlash against new wireless digital technology for measuring power usage is slowing U.S. utilities' $29 billion effort to upgrade their networks.
States including California, Maine and Vermont have responded to customer concerns about higher bills and safety by offering them the option of keeping their conventional devices for an extra charge.
The Pentagon Goes Rogue
By Bill Bonner - DailyReckoning.com
05/08/12 Baltimore, Maryland – The Obama Administration deserves credit. What other government ever reached such staggering achievements?
On the home front, as we reported last week, over the last 4 years more people have been declared disabled than have found jobs.
And overseas, an American soldier shipped out to serve in Afghanistan is more likely to be killed by himself than by the enemy. That is, the suicide rate is higher than the rate of combat losses.
Which raises a question. What kind of military force would fight a war in which its soldier's worst enemy was himself?
Answer: one that has gone rogue.
China wants Canada's oil, no matter what it says Commentary: Ambassador's comments raise questions about China's motives in Canada
By Bill Mann, MarketWatch
PORT TOWNSEND, Wash. (MarketWatch) — Is China Canada's NBF? Or BFF? Or just maybe it doesn't want Canada's oil at all, said Beijing's ambassador to Ottawa in an eyebrow-raising speech and news conference in Calgary last week, adding that China can buy oil elsewhere.
Beijing's ambassador to Canada insisted in his "crude" remarks that China's just as eager to learn the oil business as it is to import Canada's oil.
Is Canada getting played by its (ostensible) new best friend? It looks like it to me, and many Canadians are skeptical of China's motives.
Television Channels the Arab Spring
by YVES GONZALEZ-QUIJANO - CounterPunch.org
Everyone wants to talk about the role of social media in last year's uprisings, but the big Arab television news channels played just as significant a part in the Arab Spring. There is a limit to the extent to which mobile phones can replace professional cameras: their short video sequences do not have the emotional impact of a feature on Al-Jazeera or Al-Arabiya, the two biggest news channels in the region. Their live reports from Tahrir Square and elsewhere were able to reach tens of millions of viewers. Surfing the net cannot provide the live thrill viewers got each Friday in February 2011, as their TV screens simultaneously relayed the demonstrations in Tunis, Cairo, Tripoli, Sana'a and Manama like major sporting events. These will remain in the popular imagination of the region for years.
All the gold and silver roads now leading to China With the opening of silver futures trading in Shanghai, China could rapidly become a major player in silver trading given its position as now almost certainly being the world's largest silver consumer.
Author: Lawrence Williams - MineWeb.com
LONDON (MINEWEB) - This week the Shanghai Futures Exchange will start trading silver futures from Thursday. In a commentary on this the newspaper, The Australian, comments that nowadays all the gold and silver roads are leading to China, and speculation that the next few years could see the Chinese dominating the global silver market much as they appear to be doing with the global gold market.
Indeed a big inflow of silver into China - a country which has a long association with the metal having had a silver related currency standard up until the 1930s - is felt by some to be likely to end some of the metal's price volatility and perhaps end what some see as excessive manipulation of the market through COMEX.
Silver at lowest since January,
China should offer key support for gold Gold and silver both slip as market digests the various European elections and their 'anti-austerity' moods, but on the positive side India has withdrawn its 1% tax on gold jewellery and Chinese gold imports have risen again.
Author: Ben Traynor - MineWeb.com
LONDON (BULLION VAULT) - Gold prices fell to $1625 an ounce during Tuesday morning's London trading - their lowest level in over a fortnight - as stocks and commodities also ticked lower and the Dollar extended recent gains, with markets still digesting the weekend's French and Greek election results.
"Support [for gold] is at $1625, where we have seen very good support since early April," says the latest technical analysis from bullion bank Scotia Mocatta
Turkey Exports "Massive Quantities of Gold"
to Iran and Arab Spring Nations
BY MARK O'BYRNE - FinancialSense.com
Gold's London AM fix this morning was USD 1,627.00, EUR 1,250.77, and GBP 1,008.99 per ounce. Friday's AM fix was USD 1,629.50, EUR 1,240.20 and GBP 1,007.54 per ounce.
Gold fell $3.70 or 0.23% in New York yesterday and closed at $1,638.70/oz. Gold started out sideways in Asia then gradually dropped lower and this weakness continued in early European trading.
Gold edged lower on Tuesday despite the weaker euro and stock markets after furious citizens in Greece and France voted against austerity measures. Gold prices are being supported by bargain hunters who continue to buy dips around the lower end of the metal's recent range between $1,620/oz and $1,680/oz.
* * * * *
Interview with John Boehener,
by Maria Bartiromo - May 8, 2012
CNBC TRANSCRIPT: SPEAKER OF THE HOUSE JOHN BOEHNER SITS DOWN ONE-ON-ONE WITH MARIA BARTIROMO TODAY ON CNBC
....BARTIROMO: I'm going to come back to taxes and spending in a moment. But you mentioned Rome is burning, and it, in fact, is. Europe rejecting austerity, a new election in France, a Socialist president there, tell me how all of this impacts the United States, in your view.
Rep. BOEHNER: Well, I think it's pretty clear that the European economy is slowing. It's certainly going to affect our growth this year, and it's going to affect our growth in the future. But secondly, when you look at the problems that Europe has from a financial standpoint and their debt load, we're next. I mean, the picture's as clear as it can be. And I look back over the last year and a half, one of my greatest disappointments is that the president and I were unable to come to an agreement to take a significant chunk out of our long-term debt. It's--it is a real concern, and it's a real problem. But you can't address these problems from Congress alone. You need a president who will lead, and the president's not leading.
Economic Alert: If You're Not Worried Yet…You Should Be
By Brandon Smith - Alt-Market.com
For the past four years I have been covering the progression of the global economic crisis with an emphasis on the debilitating effects it has had on the American financial system. Only once before have I ever issued an economic alert, and this was at the onset of the very first credit downgrade in U.S. history by S&P. I do not take the word "alert" lightly. Since 2008 we have seen a cycle of events that have severely weakened our country's foundation, but each event has then been followed by a lull, sometimes 4 to 6 months at a stretch, which seems to disarm the public, drawing them back into apathy and complacency. The calm moments before each passing storm give Americans a false sense of hope that our capsized fiscal vessel will somehow right itself if we just hold on a little longer...
Fed reform plans percolate on Capitol Hill
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) — Key members of Congress presented distinctly different measures Tuesday to fundamentally reform the Federal Reserve, a sign that the central bank remains very much under the microscope in the wake of the extraordinary policy steps it took during and after the financial crisis.
Rep. Kevin Brady, an eight-term Republican from Texas, used a hearing of the House Financial Services subcommittee on monetary policy to make a strong pitch for his bill, which would strip the Fed of its dual mandate and see it focus solely on inflation.
Greek threat to the euro scares world's stock markets Financial markets have taken fright after Greece took another step towards leaving the euro by rejecting "barbarous" international bail-out deals.
By James Kirkup - Telegraph.co.uk
Stock markets around the world fell sharply as fears grew that Greece was moving towards a euro exit following Sunday's general election, where parties rejecting internationally-imposed austerity measures made major gains.
Alexis Tsipras, the head of Greece's radical Left-wing Syriza party, said that the result "nullified" bail-out deals with the European Union and International Monetary fund.
The Difference Between the U.S. and Europe in 1 Graph
By Derek Thompson - TheAtlantic.com
The euro zone has Greece. The United States has Mississippi. Or Missouri.
The difference between the U.S. and Europe is that when the Greek economy "pulls a Mississippi" (or perhaps I should say, when Mississippi "pulls a Greece"), the EU and the U.S. have 180-degree opposite reactions. Over here, we calmly write checks to Mississippi in the form of Medicaid and unemployment insurance, no questions asked. Europe has no comparable "Peripheraid" for its weak peripheral states. Instead, it has chaos.
New IMF Working Paper
Models Impact of Oil Limits on the Economy
BY GAIL TVERBERG - FinancialSense.com
The International Monetary Fund (IMF) recently issued a new working paper called "The Future of Oil: Geology versus Technology" (free PDF), which should be of interest to people who are following "peak oil" issues. This is a research paper that is being published to elicit comments and debate; it does not necessarily represent IMF views or policy.
The paper considers two different approaches for modeling future oil supply:
• The economic/technological approach, used by the US Energy Information Administration (EIA) and others, and
• The geological view, used in peak oil forecasts, such as forecasts made by Colin Campbell and forecasts made using Hubbert Linearization.
After Austerity
By Joseph E. Stiglitz - Project-Syndicate.org
NEW YORK – This year's annual meeting of the International Monetary Fund made clear that Europe and the international community remain rudderless when it comes to economic policy. Financial leaders, from finance ministers to leaders of private financial institutions, reiterated the current mantra: the crisis countries have to get their houses in order, reduce their deficits, bring down their national debts, undertake structural reforms, and promote growth. Confidence, it was repeatedly said, needs to be restored.
It is a little precious to hear such pontifications from those who, at the helm of central banks, finance ministries, and private banks, steered the global financial system to the brink of ruin – and created the ongoing mess. Worse, seldom is it explained how to square the circle. How can confidence be restored as the crisis economies plunge into recession? How can growth be revived when austerity will almost surely mean a further decrease in aggregate demand, sending output and employment even lower?
Forget France, the Greek Elections
Are the Beginning of the End for Europe
By IAIN MURRAY - The American Spectator.org
And that means big trouble for U.S. banks as well.
While much of the world's attention was concentrated on France's presidential election last Sunday, the real action was in Greece. French President-elect François Hollande may be promising 75 percent income tax rates and a renegotiation of the European Union's fiscal treaty, but it was the result of the Greek elections that will determine the future of Europe.
The irony is that Greece should never have been allowed into the euro in the first place. It did not meet the entrance criteria, but Eurocrats in Brussels turned a blind eye because they viewed the creation of a European identity as more important than financial stability. When the process began to unravel, a panicked EU, along with the International Monetary Fund, responded by throwing money at the problem, in exchange for a promise of austerity.
Greece sinks into chaos Greece's New Leftist Leader Says Bailout Deal Is Dead
By: Reuters - via CNBC.com
Greece sank even deeper into crisis on Tuesday when a centrist conservative party said leftist candidate for prime minister Alexis Tsipras would drive the country out of the euro with his proposal to reject an international bailout.
New Democracy leader Antonis Samaras said in a televised statement that Tsipras was asking him to sign up to the destruction of Greece with his demand that an EU/IMF bailout be rejected as the condition for a coalition government.
S&P 500 Declines to Lowest Level in One Month on Greece
By Rita Nazareth - Bloomberg.com
U.S. stocks retreated, sending the Standard & Poor's 500 Index to the lowest level in almost a month, as political tension in Greece intensified concern about a euro exit and a deepening of the region's debt crisis.
Equities trimmed earlier losses after the S&P 500 dropped below 1,350, a so-called support level being watched by traders. Hewlett-Packard (HPQ) Co. and Bank of America Corp. fell at least 2.1 percent to pace declines among the biggest companies. McDonald's Corp., the world's largest restaurant chain, slumped 2.1 percent as April sales trailed projections. Fossil Inc. (FOSL) plunged 38 percent, the most since 1995, after the owner of the namesake watch brand reduced its full-year earnings forecast.
The Countdown To The Break Up Of The Euro
Has Officially Begun
By Michael Snyder - TheEconomicCollapseBlog.com
The results of the elections in France and Greece have made it abundantly clear that there is a tremendous backlash against the austerity approach that Germany has been pushing. All over Europe, prominent politicians and incumbent political parties are being voted out. In fact, Nicolas Sarkozy has become the 11th leader of a European nation to be defeated in an election since 2008. We have seen governments fall in the Netherlands, the UK, Spain, Ireland, Italy, Portugal and Greece. Whenever they get a chance, the citizens of Europe are using the ballot box to send a message that they do not like what is going on. It turns out that austerity is extremely unpopular. But if newly elected politicians all over Europe begin rejecting austerity, this puts Germany in a very difficult position.
Euro Near Three-Month Low on Greek Leadership Concern
By Catarina Saraiva and Lukanyo Mnyanda - Bloomberg.com
The euro weakened for a seventh day against the dollar as Greek politicians struggled to form a new government after elections over the weekend raised the prospect of the country withdrawing from the currency bloc.
The 17-nation euro extended its longest run of declines against the greenback since September 2008 as German Chancellor Angela Merkel rejected government stimulus as the way to spur economic growth, setting up a clash with French president-elect Francois Hollande. The pound dropped against the dollar as a report showed U.K. house prices fell in April. Australia's dollar declined after the trade deficit widened.
Europe's FDR?
How France's New President Could Save Europe Is the new French president a "dangerous man"? Let's hope so, for the continent's sake.
By Matthew O'Brien - TheAtlantic.com
The only thing Europe has to fear is fear of 3 percent inflation. That's the truth the Old Continent desperately needs to hear. Unfortunately, Franklin Roosevelt figures are in short supply nowadays. But this weekend's seismic anti-austerity votes in France and Greece -- the latter for other, darker reasons -- have given Europe one last, best chance to come to terms with this reality. Nothing less than the future of the half-century European Project is at stake.
Newly-elected French president François Hollande has already inspired an impressive amount of hand-wringing on the part of the commentariat. His proposal to raise the top marginal tax rate to 75 percent has drawn ire from conservatives. So too has his emphasis of growth over so-called structural reforms. More broadly, his proclaimed opposition to German-led austerity and tight money has created uncertainty about the future of the euro. It's all been enough for The Economist to editorialize that Hollande is "a rather dangerous man."
Let's hope so. If he's not, the euro is certainly doomed.
Crisis escalates
as insurrection breaks German control of Europe The political dam has broken in Europe. German Chancellor Angela Merkel no longer has enough allies in the club of EU prime ministers to impose her hairshirt agenda. Her methodical plans are disintegrating on every front.
By Ambrose Evans-Pritchard - Telegraph.co.uk
The immediate fate of Greece - and the euro - is in the hands of a boyish motorcycle Marxist. Syriza leader deal Alexis Tsipras has vowed to tear up the hated Memorandum, as the EU-IMF "troika" loan package is known.
He showed no sign of backing off as he met his country's president and began talks on the formation of an implausible Left front. "The popular verdict clearly renders the bailout null and void," he said.
Zurich: A Financial Behemoth
at the Heart of a Financial Meltdown The Atlantic's new special report on the past and future of the world's global capitals begins with the 10th most powerful city in the world, which resides at the center of a continent in crisis
By Derek Thompson - TheAtlantic.com
Alfred Escher was gravely ill. Not for the first time in his life, nor the last.
In 1856, the Swiss academic-turned-politician-turned-entrepreneur had already served as a foundational Zurich statesman and as the architect of the nation's famous railway system. But Escher had higher ambitions for his rail empire, and he needed money to pay for them. So he founded a bank, Schweizerische Kreditanstalt, which changed the direction of Zurich's economy for the next two centuries.
The bank still exists to this day. You know it as Credit Suisse.
Markets Clubbed On Yesterday's News
BY BILL FLECKENSTEIN - FinancialSense.com
Overnight equity markets in Europe were a little bit soft, but didn't really turn ugly until after New York opened. The headline culprit for the angst appeared to be plunging stocks in Greece (which lost 4%) and all the associated problems with uncertainty over the lack of a new government there. However, I think that was just an excuse for markets to do what they were primed to do.
In the first 90 minutes here our indices lost about 1.5%, with Europe a little bit worse and virtually everything red. Perhaps this was a delayed reaction to last weekend's political events, but with the prevalence of computerized trading, trying to make sense out of short-term action is next to impossible.
Iran Quietly Infiltrates Europe's Underbelly The Islamist push against Europe continues.
theTrumpet.com
Iran employs an unusually large number of employees at its embassy in Sarajevo, Bosnia-Herzegovina, as part of its effort to radicalize the majority-Muslim European nation and to extend its reach "closer and closer into the heart of Europe."
On May 3, radio talk show host John Batchelor interviewed Malcolm Hoenlein, the executive vice chairman of the Conference of Presidents of Major American Jewish Organizations. Hoenlein said Iran staffs its Sarajevo embassy with over 400 employees, sharply exceeding the usual number for a facility of its kind.
Charlie Munger is Out of Touch
By Greg Hunter - USAWatchdog.com
You haven't heard much from Charlie Munger (Warren Buffett's right hand man) since he said this, a few years ago, about the massive bailouts the financial system received from taxpayers and the Federal Reserve: "So I think when you have troubles like that you shouldn't be bitching about a little bailout. You should have been thinking it should have been bigger." And for those not doing so well in the downturn, the 86-year old Munger says "suck it in and cope." Now, Mr. Munger is back, and he doesn't like gold. Well, I don't like massive money printing to bail out companies and the financial system. I think this is why many people are kind of partial to an investment that has a 5,000 year track record. Of course, all the bailouts benefited Munger, Buffett and the Berkshire fund they run.
John Williams:
The Real Unemployment Rate: 22%−Not 8.1% [audio]
The coming fiscal cliff: hyperinflation on track for 2014
Jim welcomes back John Williams from Shadow Government Statistics. John believes the real unemployment rate is 22%, not 8.1%, which is why it still feels like a recession. He also calculates the CPI at 6%, not 2.8%, and explains how the government manipulates the rate of inflation. Lastly, John believes the US is still on track for hyperinflation in 2014 as we near the coming fiscal cliff.
BofA's New Black-Belt Data Chief Targets Blinding Gaps
By Hugh Son - Bloomberg.com
John Bottega's path to becoming Bank of America Corp. (BAC)'s first data chief started two decades ago in a smoke-filled back office of Lehman Brothers Holdings Inc.
It was 1991, and Bottega was supervising one of several teams scattered across the New York-based investment bank that did pretty much the same thing: entering data on securities, monitoring the accuracy and sucking on cigarettes.
Consumer Credit in U.S. Increases by Most in 10 Years
By Meera Louis - Bloomberg.com
Consumer borrowing in the U.S. surged in March by the most in more than a decade on growing demand for educational financing and autos.
Credit rose by $21.4 billion, the biggest gain since November 2001, to $2.54 trillion, Federal Reserve figures showed today in Washington. The advance was paced by a $16.2 billion jump in non-revolving debt, including student and car loans.
Americans may have been trying to get school financing before a possible increase in interest rates takes place on July 1. Rising consumer confidence also means that households are more willing to take on debt to boost spending, which accounts for about 70 percent of the economy.
Will Uncle Sam Takeover Your IRA?
Larry Doyle - SilverBearCafe.com
Those engaged in massive strategic maneuvers know all too well that progress is typically made not in one fell swoop but painstakingly inch by inch.
With deficits beyond the scope of imagination but oh so very real, I cautioned people to keep a watchful eye on Uncle Sam. Where might the old man go to beg, borrow, or steal money to fill that enormous fiscal hole? Your retirement accounts. I first broached this topic in early 2010 in writing, Blueprint for Government Takeover of IRAs and Will Uncle Sam Takeover Your IRA?.
Fast forward and we now witness rumblings around Washington that the drunken sailors disguised as our political leaders are discussing how to make a move on your retirement savings.
Americans: Too broke to go bankrupt
By Blake Ellis | CNNMoney.com
This year, hundreds of thousands of Americans are expected to be too broke to file for bankruptcy.
The average cost to file for Chapter 7 bankruptcy protection, the most common form of consumer bankruptcy, is more than $1,500, according to recent research submitted to the National Bureau of Economic Research.
As a result, anywhere between 200,000 and one million consumers are estimated to be unable to afford that steep cost this year.
The research, conducted by a group of professors from Columbia University, the University of Chicago and Washington University in St. Louis, examined how bankruptcy filings spiked after people received their tax rebates in previous years. They estimate that another 200,000 consumers, who would otherwise not have enough money to file, will use their tax refunds to pay for bankruptcy this year.
Where are the non-performing GMAC/Ally assets?
....BANKRUPTCY not far off.
Ally's mortgage unit problems come full circle
By Soyoung Kim, Rick Rothacker and Paritosh Bansal
(Reuters) - In the fall of 2009, the board of GMAC, one of the largest U.S. auto and home-loan companies, gathered in New York to discuss whether to put its troubled mortgage unit into bankruptcy.
GMAC, now called Ally Financial, was just about to receive the last of $17 billion in taxpayer bailouts. The board, including directors named by the U.S. government, discussed whether to use bankruptcy to get rid of toxic mortgage assets that were pulling down the rest of the company, according to people who attended the meeting.
13 Investigates: IRS tax loophole
Eyewitness News shows a massive tax loophole that provides billions of dollars in tax credits to undocumented workers and, in many cases, people who have never set foot in the United States.
Will lawmakers act to close tax loophole
for illegal immigrants?
By Bob Segall - WTHR.com
INDIANAPOLIS - Congressman Dan Burton (R – Ind) is frustrated – very frustrated – after learning the details of an Eyewitness News investigation.
"Why in the world are we doing this?" he asked. "Are you kidding me? The cost to the American tax payer is huge!"
The veteran lawmaker is responding to what 13 Investigates discovered all across Indiana: illegal immigrants getting big tax refunds from the Internal Revenue Service thanks to a loophole in federal law.
Behavioral Placement:
TaxPayers Paying for Brainwashing!
Alex talks with Dr. Katherine Albrecht, an expert in the area of privacy and technology. She is the founder of Consumers Against Supermarket Privacy Invasion and Numbering and hosts "The Dr. Katherine Albrecht show" on the GCN Radio network.
Hate Obamacare? Keep Tax Cuts? You Do the Budget
By: Cindy Perman - CNBC.com
With all this "fiscal cliff" talk about the US economy plunging when tax cuts expire and government spending cuts hit early next year, it's easy to second-guess the presidential candidates about their plans.
That will never work! We're headed for a cliff!you shout from your living room, spilling a little beer on your armchair amid the hoopla of your enthusiastic critique.
Well, arm-chair politicians, it's time to put the beer down and see if you can do better than President Obama, Mitt Romney and the other candidates.
Is Obama Negotiating A Treaty
That Would Essentially Ban All "Buy American" Laws?
By Michael Snyder - TheEconomicCollapseBlog.com
69 members of the U.S. House of Representatives have sent Barack Obama a letter expressing their concern that a new international treaty currently being negotiated would essentially ban all "Buy American" laws. This new treaty is known as the Trans-Pacific Partnership, and it is going to be one of the biggest "free trade" agreements in history. Critics are referring to it as the "NAFTA of the Pacific", and it would likely cost the U.S. economy even more jobs than NAFTA did. At the moment, the Trans-Pacific Partnership includes Brunei, Chile, New Zealand and Singapore. Barack Obama is pushing hard to get the United States into the TPP, and Australia, Peru, Malaysia, Vietnam, Canada, Japan and South Korea are also reportedly interested in joining. But quite a few members of Congress have heard that "Buy American" laws will essentially be banned under this agreement, and this has many of them very concerned. You can read the entire letter that was sent to Obama right here. Unfortunately, the leaders of both major political parties are overwhelmingly in favor of the Trans-Pacific Partnership, so the objections of these 69 members of Congress are likely to fall on deaf ears. The Trans-Pacific Partnership will accelerate the flow of American jobs out of this country, and meanwhile our politicians will continue to insist that they are doing everything that they can to "create jobs".
Senate Republicans Block Student Loan Rate Freeze Plan
By Kathleen Hunter - Bloomberg.com
U.S. Senate Republicans blocked Democrats' proposal to cover the cost of a one-year freeze in government student loan interest rates by requiring some professional services firms to pay withholding taxes on their income.
The Senate, in a 52-45 vote with 60 required, didn't advance the plan to avert a July 1 increase in college-loan interest rates to 6.8 percent from 3.4 percent. No Republicans joined Democrats in voting to advance the measure.
"Republicans claim that they want to stop student-loan interest rates from doubling this summer," Senate Majority Leader Harry Reid told reporters after the vote. "That's what they say. But Republicans showed today that it's only talk."
A Leaderless World
BY JOHN MAULDIN - FinancialSense.com
I recently had a chance to speak at a conference where Dr. Ian Bremmer spoke after me. I was very impressed with his thought process and asked him to give me an outline of his speech to share with you for this week's Outside the Box. It's a shorter version of his powerhouse book, Every Nation for Itself: Winners and Losers in a G-Zero World. I highly recommend it.
And what, you're asking, is a "G-Zero world"? In a word, it's a leaderless world. A world in which, as Bremmer says, "Not so long ago, America, Western Europe and Japan were the world's powerhouses. Today, they're struggling to recover their dynamism…. But nor are rising powers like China, India, Brazil, Turkey, the Gulf Arabs and others ready to take up the slack…. If not the West, the rest, or the institutions where they come together, who will lead? The answer is, no one."
Jeff Rense Reads Orwell - The End Of Freedom
The proletarians will never revolt, not in a thousand years or a million. They cannot. I do not have to tell you the reason: you know it already. ... There is no way in which the Party can be overthrown. The rule of the Party is for ever. Make that the starting-point of your thoughts.'
China's Biggest Challenge Isn't Military or Economic,
It's Basic Governance Bo Xilai and Chen Guangcheng are reminders that corruption, human rights, and rule of law could check the rising power's might.
By Michael Fullilove - TheAtlantic.com
For at least a decade, think tanks and government offices have echoed with tales of China's rise.
The narrative is familiar. China has remade its economy and is now eating America's lunch. The country is growing rapidly, laying roads and high-speed rail at a frenetic pace. The Chinese authorities sit atop a hoard of foreign exchange reserves that symbolize the country's new financial clout.
Increasingly, China's economic strength is mirrored in its military capability. It is, according to its boosters, destined for hegemony in the Asia-Pacific. Soon, they say, it may even be a peer-competitor of the United States.
Obama Official Endorses Marx on Class Warfare
By JEFFREY LORD - The American Spectator.org
Well now.
One Rick Bookstaber has come out with a defense of class warfare.
And endorsing Karl Marx.
Who is Rick Bookstaber, you may ask?
He is a member of the Obama Administration. Specifically, in his words:
I am Senior Policy Adviser to the Financial Stability Oversight Council in Treasury, and also am Senior Policy Adviser in the Division of Risk, Strategy, and Financial Innovation at the SEC.
Mr. Bookstaber has some interesting views on class warfare, which he has just discussed yesterday on his blog. Apparently following the Daily Caller's Tucker Carlson at a Washington event, an event where Mr. Carlson denounced class warfare, the Obama appointee took offense at the notion there was something wrong with class warfare.
After The Government Microchips Our Soldiers,
How Long Will It Be
Before They Want To Put A Microchip In YOU
By Michael Snyder - EndOfTheAmericanDream.com
What would you do if someday the government made it mandatory for everyone to receive an implantable microchip for identification purposes? Would you take it? Such a scenario may not be as far off as you might think. In the United States today, millions of dogs and cats have been microchipped, thousands of elderly Americans with Alzheimer's disease have been microchipped, and the U.S. military is developing "medical devices" that contain microchips to monitor the health of soldiers. Once the government has microchips implanted in all of our soldiers, how long will it be before they want to put a microchip in all government employees for the sake of national security? Once the government has microchips in all government employees, how long will it be before they want to put a microchip in you? Of course this technology is not going to be "required" for average citizens any time soon. For now, it will creep into our lives at an incremental pace. But after enough people have voluntarily accepted the "benefits" of implantable microchips, it will only be a matter of time before they become mandatory. Are you ready for that?
The Dark Side of the Prestigious Marine Barracks
By Col. Ann Wright - Truthdig.com
According to Marine Corps lore,semper fidelis, a Latin phrase for "always faithful," commands Marines to remain a "brotherhood, faithful to the mission at hand, to each other, to the Corps and to country, no matter what. Becoming a Marine is a transformation that cannot be undone and once made, a Marine will forever live by the ethics and values of the Corps."
The Marine Barracks in Washington, D.C., is the official residence of the commandant of the Marine Corps. It is the home of the Marines who are the ceremonial guard for the president during official U.S. government functions and the security force for the White House and Camp David. The Marine Band, also located at the Barracks, is known as "The President's Own." The Barracks is the showplace of the Marine Corps with its Silent Drill Platoon giving weekly military precision performances for the public during the busy summer tourist season.
The web's about creating vast wealth for the few,
not jobs for the many Don't bother with the lottery, or even the fast buck attributes of finance; design an app. It'll make you richer. Much, much richer.
By Jeremy Warner - Telegraph.co.uk
How long the phenomenon will last is anyone's guess but, for now, the commercial value of innovation has never been higher. Rarely, if ever before, in history has it been possible to make so much wealth in so little time and with so few employees.
Even hedge fund billionaires such as George Soros would struggle to match the extraordinary value-creative powers of the latest generation of technology entrepreneurs.
Google gets first license for self-driving cars Nevada issues license for Google to test autonomous cars on state roads, highways
By Sharon Gaudin - Computerworld.com
Computerworld - The people of Nevada may be in for a surprise when they drive to the market or down the highway -- driverless cars.
The Nevada Department of Motor Vehicles on Monday issued the first state license to Google for self-driven cars. It is also the nation's first autonomous vehicle license, according to the Nevada DMV website.
"It's still a work in progress," said Tom Jacobs, a DMV spokesman, told theLas Vegas Sun. "The system regulates the brakes, accelerator and steering."
Have we totally lost our perspective... ?
'Angry Birds' Now a $100 Million Revenue Business
WSJ.com
"Angry Birds" started in December 2009 as a silly mobile-phone game that involves sling-shotting cartoon birds at smirking pigs. Now it's a $100 million-a-year business.
Rovio Entertainment, the Finnish game developer behind the "Angry Birds" franchise, said today its revenue totaled EUR75.4 ($98.7 million) last year.
That revenue didn't come solely from the game downloaded 648 million times last year. About 30% stemmed from merchandising and licensing. Last year Roviobegan turning "Angry Birds" into an entertainment franchise, pushing into movies, books, toys and even "gummy" candy.
Drug-Defying Germs From India Speed Post-Antibiotic Era
By Jason Gale and Adi Narayan - Bloomberg.com
Lill-Karin Skaret, a 67-year-old grandmother from Namsos, Norway, was traveling to a lakeside vacation villa near India's port city of Kochi in March 2010 when her car collided with a truck. She was rushed to the Amrita Institute of Medical Sciences, her right leg broken and her artificial hip so damaged that replacing it required 12 hours of surgery.
Three weeks later and walking with the aid of crutches, Skaret was relieved to be home. Then her doctor gave her upsetting news. Mutant germs that most antibiotics can't kill had entered her bladder, probably from a contaminated hospital catheter in India. She risked a life-threatening infection if the bacteria invaded her bloodstream -- a waiting game over which she had limited control, Bloomberg Markets magazine reports in its June issue.
Civil Defense of Peru issues earthquake warnings
after two days of abnormal tremor activity
By Alvin Conway - The Extinction Protocol Blog
May 8, 2012 – PERU - The Civil Defense in Peru (Indeci) intensified today a prevention drive warning of a potential massive earthquake now preceded of two daily tremors average. Indeci called on every workplace and home to ready an emergency evacuation plan after a median quake and two replicas were recorded Sunday in Ica (south) and in Lima. Marco Tantalean, an expert from the institution, said planning must include safe routes and refuges, plus staples like your ID cards, drinkable water, first-aid material, flashlight, non perishable food and saving phone calls for emergencies to prevent the lines from collapsing.
Beaches closed in Peru as bird and dolphin deaths continues
By Alvin Conway - The Extinction Protocol Blog
May 8, 2012 – PERU - Officials insist that the two die-offs are unrelated. The dolphins are succumbing to a virus, they suggest, and the seabirds are dying of starvation because anchovies are in short supply. But even three months after officials began testing the dolphins, the government has not released definitive results, and there is growing suspicion among the public and scientists that there might be more to the story. Some argue that offshore oil exploration could be disturbing wildlife, for example, and others fear that biotoxins or pesticides might be working their way up the food chain. At least 877 dolphins and more than 1,500 birds, most of them brown pelicans and boobies, have died since the government began tracking the deaths in February, the Environment Ministry said last week.
Bull Market in Gold Far From Over:
New Commodity Report by Top Financial Newsletter, Profit Confidential
If China is to back its currency, the yuan, it won't use exchange-traded funds (ETFs) to do it, but rather gold bullion, according to Michael Lombardi, lead contributor to Profit Confidential.
New York, NY (PRWEB) May 07, 2012
If China is to back its currency, the yuan, it won't use exchange-traded funds (ETFs) to do it, but rather gold bullion, according to Michael Lombardi, lead contributor to Profit Confidential.
Lombardi calculates that the demise of the gold bullion market is greatly exaggerated, as the demand for physical gold by China and other large investors will continue for some time.
Demand for Gold ETF's falling, not Gold bullion
NEW YORK(Commodity Online): The demand for gold ETF is falling while serious gold bullion investors look for physical gold coins and gold bullion, says Michael Lombardi, leading contributor for financial newsletter Profit Confidential.
Lombardi investigated the notion that the demand for gold bullion has fallen. "That statement is false," says Lombardi. "Demand for gold ETFs is clearly falling; however, the demand for actual physical gold coins and gold bullion has increased significantly."
In the article, 'Is the Bull Market in Gold Over?' Lombardi observes if China is back to Yuan, its currency, it won't use gold ETF's, but rather go for gold bullions..
Why Civilized People Buy Gold and Silver
BY RYAN JORDAN - FinancialSense.com
I often feel that just making lists of things helps to combat the misinformation all of us confront from those trying to craft and abuse public opinion. Many are by now familiar with Charlie Munger (Warren Buffet's sidekick) and his comment that gold is not for "civilized" people. I want to list the reasons gold (and silver) are, in fact, for civilized people. Although it is hard to paint with a broad brush, many of us feel that the current financial system, epitomized by Wall Street, doesn't quite cut it at times when it comes to civility.
Warren Who? Gold Bugs Still Think They Have Right Idea
By: Jeff Cox - CNBC.com
It's not everyday you can find people to take the opposite side of a trade from Warren Buffett and Bill Gates, but then gold is not your average trade.
Gold bugs are known as some of the most passionate investors, so not even high-level slams from the Oracle of Omaha and the founder of Microsoft can cool their fire.
"Absolutely I would take the other side of that trade," says Michael Pento, founder of Pento Portfolio Strategies in Holmdel, N.J. "The stock market has gone nowhere in nominal terms in 12 years. It makes sense as a default under the current conditions of negative real interest rates to own something that keeps you afloat, that preserves your purchasing power."
The Munger Games
Editorial of The New York Sun
One would think that a man as wealthy, as smart, and as old as Charles Munger would have known better than to suggest that people who buy gold are uncivilized. "Gold is a great thing to sew into your garments if you're a Jewish family in Vienna in 1939," Mr. Munger told Rebecca Quick of CNBC, "but I think civilized people don't buy gold, they invest in productive businesses." The fact is that people who bought gold a decade ago were far better positioned than those who put their money in Mr. Munger's company, Berkshire Hathaway. For the value of a share of Berkshire Hathaway has collapsed over the past decade to barely more than 74 ounces of gold from the 238 ounces it was worth a decade ago.
Russia to sell 50% less Palladium in 2012
NEW YORK (Commodity Online): Russian Palladium sales are expected to drop by 50% this year, says Thomson Reuters GFMS. Russia is the largest Palladium supplier in the world with almost half of the world's supply in the soviet nation.
In a Presentation in London, Bloomberg quotes GFMS' Philip Klapwijk as stating that Russian sales of palladium from its inventories could drop to 400,000 ounces in 2012 compared to 800,000 ounces in 2011. The total global palladium stockpiles in the world currently comes to 11.5 million ounces, he added.
The Federal Reserve Turns Left
William Greider - TheNation.com [progressive/liberal source]
Washington is lost in a snarl of confusion, cowardice and wrongheaded ideological assumptions that threaten to keep the economy in a ditch for a long time. That prospect is not much discussed in the halls of Congress or the White House. It's as though the crisis has been put on hold until after the presidential election.
As almost everyone understands, nothing substantial will be accomplished this year. President Obama is campaigning on warmed-over optimism and paper-thin policy proposals. Republicans propose to make things worse by drastically shrinking government spending, when the opposite is needed to foster a real recovery. The president, like the GOP, embraces large-scale deficit reduction. In these circumstances, it's just as well that the two parties cannot reach agreement. After the election they may make a deal that splits the difference between bad and worse. In the worst case, they might inadvertently tip the economy back into recession.
Ron Paul Takes on the Federal Reserve … Again
By Tim Iacono - IaconoResearch.com
From MarketWatch comes this report about Rep. Ron Paul (R-TX) who, fresh off of a Bloomberg debate with Paul Krugman and a scathing op-ed on central bankers in the Financial Times, will host a gathering of elected officials in Washington next week to debate the future of the Federal Reserve, that is, if it has one.
Among other things, they'll be discussing Paul's Federal Reserve Board Abolition Act which, from the sound of the title, you'd think they should consider first as it may save the committee a whole bunch of time debating various measures aimed at reforming the Fed.
Study exonerates Federal Reserve's crisis-era bailouts
By Jonathan Spicer
(Reuters) - A study by economists at one of the regional Federal Reserve banks has found that the U.S. central bank didn't break any laws in its handling of the 2007-09 U.S. financial crisis, and that, in fact, it handled that crisis better than the savings and loan collapse of the 1980s.
The Federal Reserve had attracted scorn when it loaned hundreds of billions of dollars to troubled banks during the 2007-09 crisis, with some critics suggesting the bailout broke the law.
The Emperor is Naked: David Stockman Interview
TheAuReport.com The Gold Report: David, you have talked and written about the effect of government-funded, debt-fueled spending on the stock market. What will be the real impact of quantitative easing? David Stockman: We are in the last innings of a very bad ball game. We are coping with the crash of a 30-year–long debt super-cycle and the aftermath of an unsustainable bubble.
Quantitative easing is making it worse by facilitating more public-sector borrowing and preventing debt liquidation in the private sector—both erroneous steps in my view. The federal government is not getting its financial house in order. We are on the edge of a crisis in the bond markets. It has already happened in Europe and will be coming to our neighborhood soon.
The Fraud & Theft Will Continue Until Morale Improves
BY JAMES QUINN - FinancialSense.com
The BEA reported the latest figures for personal income, personal consumption expenditures and the savings rate last week. The government mouthpieces in the mainstream media obediently reported that personal income and expenditures reached an all-time high in March. The chart below shows the ever increasing level of expenditures by consumers since this supposed economic recovery began in the 4th quarter of 2009. All good Keynesian economists know that consumer spending is always good for America, no matter how it is achieved. We must be in a recovery if income and spending are reaching new highs, right? That is the fraudulent storyline being propagandized to the non-questioning lapdog public. A false storyline and data that has been massaged harder than a Secret Service agent by a Columbian hooker will not lead to a happy ending. Some critical thinking, a calculator, and some common sense reveal the depth of the fraud and expose the theft being committed by the avaricious governing elite at the expense of the prudent working middle class.
The Treasury Bubble in One Graph Playing dice with the devil
By John Aziz - ZeroHedge.com
What are the classic signs of an asset bubble? People piling into an asset class to such an extent that it becomes unprofitable to do so.
Treasury bonds are so overbought that they are now producing negative real yields (yield minus inflation): [see chart]
That's right, after taking into account inflation, many investors in treasuries are standing over a drain and pouring their money down it.
And so America's creditors are now getting slapped quite heavily in the mouth by the Fed's easy money inflationist policies.
No Recovery: This is Just the Eye of the Storm In a nutshell, the U.S. economy remains weak
By Craig Steiner - Townhall.com
Over the last six months the economy, our debt problem, and the problems in Europe have largely taken a backseat to the presidential race. Though things have often appeared calm, the truth is that nothing has changed.
Greece is still in trouble, as is Europe. Our debt situation has been ignored for yet another year. The Federal Reserve is still standing by with QE3. And our fiscal trajectory is still on a course for economic collapse.
It's Official: Economy Heading Down
By Greg Hunter's USAWatchdog.com
There has been so much bad economic news out, recently, I do not see how anyone with half a frontal lobe could say the economy is not in trouble. Friday, new unemployment figures were announced, and a weak 119,000 jobs were created. The rate fell to 8.1%, but only because more discouraged workers stopped looking for work and disappeared from the government's data base. In Friday's report, economist John Williams of Shadowstats.com summed it all up by saying, "The headline U.3 unemployment rate dropped a statistically insignificant notch to 8.1% in April, from 8.2% in March, but the "good" news was anything but good. The declining pace of headline unemployment reflected an accelerating increase in the number of the headline unemployed giving up looking for work, because there were no jobs to be had. . . . The SGS-Alternate Unemployment Measure, accordingly, notched higher in April to 22.3%, from 22.2% in March." (Click here to go to the free section of Shawowstats.com.) So, unemployment in the real world actually went up—not down. According to outplacement firm Challenger, Gray & Christmas, planned job cuts rose 7.1% in April, and more than 40,000 more workers are going to be laid off.
The Governments They Deserve
By ROSS KAMINSKY - The American Spectator.org
On Sunday, elections were held in France and in Greece. And although the French, who have a large economy, elected a Socialist, the real -- and most dangerous -- news of the day came from the Greek election in which voters gave strong support, though not a majority, to parties of the extreme left and extreme right, at the expense of the long-ruling parties which had supported recent austerity measures and other efforts to get international bailouts.
The Greek election could be deeply unstabilizing for Europe, not because Greece is in itself a big economic problem for those outside of Greece, even if it defaulted on its debt. Instead, the problem is that it will harm the courage of other nation's leaders -- such as in Portugal, Spain, and Ireland -- to make the difficult decisions necessary to get their budgets under control.
Spain moves reluctantly to save major bank
By Katell Abiven | AFP - CA.News.Yahoo.com
Spain will swoop in with public money this week to clean up huge bad loans at the nation's fourth-biggest listed bank, Bankia, the government said Monday.
As news emerged of the impending rescue of Bankia, created in 2010 from a merger of seven savings banks, its executive chairman Rodrigo Rato announced his resignation.
Voter Anger Sweeps Europe Sarkozy Out as Socialist Hollande Wins France
By DAVID GAUTHIER-VILLARS - WSJ.com
PARIS—French voters elected Socialist Party candidate François Hollande as president Sunday, choosing a national leader who has pledged to shift the burden of economic hardship onto the rich and to resolve the protracted euro sovereign-debt crisis by softening the current prescription of austerity.
With his victory over conservative incumbent Nicolas Sarkozy in the second and final round of voting, Mr. Hollande—France's first Socialist president in 17 years—won a mandate to challenge German Chancellor Angela Merkel, who has imposed spending cuts as the main remedy to repair the public finances of heavily indebted European countries.
Europe's Right in Disarray Nicolas Sarkozy's demise is the least of its problems.
By SAMUEL GREGG - The American Spectator.org
Much can change in five years. In 2007, Nicolas Sarkozy, a man who forged his reputation as a dynamic no-nonsense Interior Minister, was viewed by many as France's best chance in a generation to break away from the country's hyper-interventionist economic policies and the left's suffocating monopoly of French cultural life. Now, however, Sarkozy has been discarded by France's electorate in favor of one of the driest socialist career-politician apparatchiks ever to ascend to high office in Europe.
IS THIS THE END OF '1 EUROPE'? continuing ascendancy of 'tribalism, radicalism and socialism'
By Pat Buchanan - WND.com
How Europe's crisis resolves itself as yet remains unknown.
But with Sunday's returns from France and Greece, the mega-trends on the Old Continent are unmistakable. And for the European Union, they are ominous.
Nationalism – be it economic nationalism or ethnic nationalism – is ascendant. Transnationalism and multiculturalism are in headlong if not irreversible retreat. The European project is itself imperiled.
The Resurgence of the European Left Francois Hollande, who won the French presidential election this weekend, is part of a broader European movement against the EU and austerity.
By Heather Horn - TheAtlantic.com
On Sunday, French voters struck back at President Nicolas Sarkozy's "anglo-saxonisme" policies of British-style austerity and free-market economics by electing socialist François Hollande to replace him. Ironically, in doing so, they are following a similar political path as those Anglo-Saxons across the English Channel. Hollande's win is also part of a larger European revival of left-wing politics, a reaction against the European Union's struggles.
[Progressive] Bernie Sanders
Brings the Anti-Austerity Fight to America
John Nichols on TheNation.com
Bernie Sanders is as focused as any member of Congress could be on the struggles of the state he represents, and more generally on the challenges facing working people across the United States.
But that does not mean that the independent senator from Vermont fails to recognize when things are kicking up around the world—especially when those developments have meaning for the fights he is waging in Washington.
European 'Austerity' Flames Out with Elections
By Rick Ackerman - ZeroHedge.com
Europe's doomed experiment with the politics of austerity went down in flames over the weekend as voters across the region veered sharply to the left in savaging incumbents. Elections in six European nations on Sunday promised to end any pretense of fiscal sanity. However, it remains to be seen how quickly and drastically the new leaders will act to further unbalance their nations' books, ostensibly in the name of economic growth. Whatever they decide, there's a Catch-22 that could make any promises of budget-busting relief for pensioners and public workers impossible to keep. Recall that even the socialists in Greece's parliament were forced to support austerity measures a few months ago, because without such measures the country would have been unable to borrow enough cash to meet payroll.
Francois Hollande has ten weeks to avert a French bond crisis There will be no speculative attack against French bonds on Monday morning because François Hollande has been elected president, the first socialist to take the Élysée since the Mitterrand debacle of 1981.
By Ambrose Evans-Pritchard - Telegraph.co.uk
The phantom army waiting to pounce is the cynical invention of the Sarkozy campaign. Any fears of a Leftist lurch have been in the price for weeks.
What is true is that the CAC-40 index of French stocks has underperformed Germany's DAX by 20pc since last August, an ominous divergence for two countries yoked so tightly together. The yield spread of German 10-year Bunds over French OAT bonds has jumped 90 basis points.
Greek, French voters reject German-led austerity
By Noah Barkin
(Reuters) - Greek voters dealt a serious blow on Sunday to the fragile political consensus that has kept Europe's currency bloc intact through more than two years of crisis, rejecting the austerity-for-aid policies that have shielded the country from bankruptcy and a euro exit.
Greece's vote, combined with the victory of Socialist Francois Hollande over incumbent Nicolas Sarkozy in a French presidential election, will raise pressure on Europe's paymaster Germany to pursue a more growth-oriented approach to the crisis.
The Banks' Nightmare Is Coming True:
Greek Left Calls For Anti-Bailout Coalition
Submitted by Tyler Durden - ZeroHedge.com
The only saving grace of the earlier horrendous Greek parliamentary vote was that, based on very preliminary results New Democracy and Pasok would be able to form a coalition government with precisely 151 seats needed in parliament to give them status quo powers. However, according to a more recent re-rack of the votes (New Democracy 18.9%, 108 seats, Pasok 13.4%, 41 seats, Syrizia: 16.6%, 51 seats, and all others), this assumption is now in jeopardy as the two pro-bailout parties will have just 149 seats in the new parliament, or not even a full majority. Why is this problematic? Because virtually every other party in the new parliament, and there may be up to 10 there including the New Dawn, have voiced their opposition to the bailout of Greece, which as everyone knows is merely a bailout of Europe's insolvent banks using Greek taxpayer funds as a conduit. And, adding insult to injury, Reuters now reports that "Greek leftist leader calls for anti-bailout coalition." It appears that finally, after many years of delays, the anti "bailout" genie is finally out of bottle...
Greek Leftist Comes Into His Own
By Matina Stevis - WSJ.com
Young and charismatic, Alexis Tsipras may be the man to watch on the Greek political scene.
The 37-year-old, who's an engineer by training, heads the Coalition of the Radical Left — or Syriza — an umbrella left-wing party that brings together various leftist strands ranging from Communist to Social-democrat and environmentalist groups.
His party has seen its polling figures rise in recent weeks, ahead of the May 6 elections. The last polls—before a two week blackout period imposed ahead of Sunday's vote–showed Syriza poised to become the third largest party for the first time in its history, garnering on average above 10% of the popular vote. If this materializes on Sunday, it will be a significant boost from the party's showing in the 2009 elections when it was fifth party with 4.6%.
Greece at new risk of being pushed off euro
By Michael Birnbaum - WashingtonPost.com
ATHENS — It took months for international finance officials to piece together a bailout that was acceptable to Greek leaders. But it took voters just 12 hours at the polls to deal it a hard blow, leaving Greece on Monday at renewed risk of being pushed off the euro currency once and for all.
Infuriated by demands for harsh spending cuts that could exacerbate a crippling recession,Greek voters on Sunday overwhelmingly rejected politicians who had supported the $171 billion bailout that is keeping the country from bankruptcy. After just hours of trying to form a coalition government Monday, Antonis Samaras, head of the top-vote-getting New Democracy party, gave up, giving an anti-bailout party a stab at it.
Germany's new strength has a foreign accent Markets emerge for luxury goods
By Patrice Hill-The Washington Times
BERLIN — Germany has leveraged its economic strength to take the leading role in addressing Europe's debt crisis, but ironically it owes much of that success recently to the appeal of German products in emerging countries such as China and Russia — far outside its traditional markets in Europe.
German companies' unusual success in selling pricey, top-quality goods including luxury cars and new kitchens around the world has given citizens here rising confidence that their characteristic thrift, perfectionism and hard work can make their country a role model for the rest of Europe — and indeed the world — as governments from Athens to Washington struggle to get their fiscal houses in order.
Look Who's Pushing Homeowners Off the Foreclosure Cliff
By the Editors - Bloomberg.com
One of the more confounding aspects of the U.S. housing crisis has been the reluctance of lenders to do more to assist troubled borrowers. After all, when homes go into foreclosure, banks lose money.
Now it turns out some lenders haven't merely been unhelpful; their actions have pushed some borrowers over the foreclosure cliff. Lenders have been imposing exorbitant insurance policies on homeowners whose regular coverage lapses or is deemed insufficient. The policies, standard homeowner's insurance or extra coverage for wind damage, say, for Florida residents, typically cost five to 10 times what owners were previously paying, tipping many into foreclosure.
REO-to-Rental Pilot Details
Presented to Congressional Committee FHFA plan to convert owned real estate (REO) to rental property; Sales targeted - not deeply discounted.
BY JANN SWANSON - MortgageNewsDaily.com
Members of the House Financial Services Subcommittee on Capital Markets and Government Sponsored Enterprises were told details Monday of the Federal Housing Finance Agency's (FHFA) plan to convert owned real estate (REO) to rental property. Meg Burns, FHFA's Senior Associate Director for Housing and Regulatory Policy, told committee members that the program is aimed at some of the 180,000 REO properties owned by the two government sponsored enterprises (GSEs) Freddie Mac and Fannie Mae.
Have Insurance Companies
Forgotten the Meaning of Insurance? Liberty Mutual was born to protect ordinary workers. Today, by funneling money from regular families into the hands of executives, it has inverted its very reason to exist. Sadly, this case is not unique.
By Yoni Appelbaum - TheAtlantic.com
A hundred years ago, the factories and shop floors of the United States were home to appalling violence. Machines and tools severed digits, mangled limbs, and, with horrifying regularity, killed their operators. Under the liability laws of the day, only one victim in fifteen received reasonable compensation from his employers. That injustice exacerbated already tense labor relations. In Massachusetts, organized laborpressed hard to establish a new, state-sponsored mutual insurer; the Chamber of Commerce agreed. In 1911, the legislature overhauled workers' compensation, chartering the Massachusetts Employers Insurance Association to mitigate the hazards faced by ordinary workers.
* * * * * It's about TAXES, stupid! * * * * *
The Health-Care Mandate
Is Clearly a Tax—and Therefore Constitutional The mandate fits the textbook definition of a tax: it raises revenue, serves the general welfare, and it is not a criminal penalty in disguise. So why won't Obama call it that?
By Jack M. Balkin - TheAtlantic.com
Throughout the constitutional debate over the Affordable Care Act, most observers have assumed that the key question would be whether the individual mandate is a proper exercise of Congress's powers to regulate interstate commerce. But there has always been a second argument, largely neglected -- Congress has the power to pass the individual mandate as a tax. And that argument offers an easy way to uphold the Affordable Care Act without delving into the metaphysics of broccoli.
In fact, the individual mandate is a tax. The mandate is an amendment to the Internal Revenue Code, and it is calculated based on a percentage of adjusted gross income or a fixed amount, whichever is larger. Starting in 2014, it will be collected on your form 1040 just like your other taxes.
Romney Support Among Senior Citizens
Transcends Medicare Stance
By John McCormick - Bloomberg.com
The master-gardener meeting, the bridge tournament, and a heated match of seven-card draw poker leave little time for politics at the Via Linda senior citizens' center in Scottsdale, Arizona. Yet ask about President Barack Obama and former Massachusetts Governor Mitt Romney and it doesn't take long to determine the preferred candidate.
"He has some very socialistic leanings and believes in big government," Lu Ittner, 86, a retired surgical nurse, said of Obama. "He is destroying our economy with his policies."
Romney rejects Ron Paul-style austerity
By Seth McLaughlin - WashingtonTimes.com
You can almost hear the collective gasp from Ron Paul's loyal band of supporters.
Speaking Monday at a town hall style-meeting event in Cleveland, presumptive GOP presidential Mitt Romney plunged a fork into the idea that he could come around to embracing Mr. Paul's call for deep cuts in federal spending.
"My job is to get America back on track to have a balanced budget. Now I'm not going to cut $1 trillion in the first year," he said, distancing himself from Mr. Paul's plan to slice more than a quarter of the estimated $3.8 trillion being spent by the the federal government.
Keynes' Legacy: 24% Unemployment
BY NED W SCHMIDT CFA - FinancialSense.com
In "'Lost generation' to suffer years of unemployment", Financial Times, 3 May, the legacy of Keynes was summed up by comments on Spanish youth, "More than half of those under 25 are without work and face a bleak future. . ."
Some may never have a future after the Keynesian led collapse of their economy. Per that article Spanish unemployment is 24.1%. Greece is much better, only 21.7%. After decades of Keynesian debt financed consumption the verdict is in on Keynesianism. It is a complete and total failure!
A welcome-home gift for veterans: Jobs Keeping Veterans off the unemployment rolls
By Mike Mullen and Steven A. Cohen - WashingtonPost.com
Adm. Mike Mullen served from 2007 to 2011 as chairman of the Joint Chiefs of Staff. Steven A. Cohen is founder of S.A.C. Capital Advisors. They are co-chairs of the Robin Hood Foundation's veterans advisory board.
Our nation is finally emerging from one of the worst recessions in American history, yet for our military veterans there is no recovery in sight. The nation's unemployment rate is 8.1 percent. But the unemployment rate of our youngest military veterans returning from Iraq and Afghanistan hovers at a stunning 29 percent.
Consider that: Nearly one in three Americans who fought to defend us in distant lands cannot find a job here at home.
State bans bake sales... Rule's half-baked
State's junk food ban could take bite out of school fundraisers
By Laurel J. Sweet and Chris Cassidy - BostonHerald.com
Bake sales, the calorie-laden standby cash-strapped classrooms, PTAs and booster clubs rely on, will be outlawed from public schools as of Aug. 1 as part of new no-nonsense nutrition standards, forcing fundraisers back to the blackboard to cook up alternative ways to raise money for kids.
At a minimum, the nosh clampdown targets so-called "competitive" foods — those sold or served during the school day in hallways, cafeterias, stores and vending machines outside the regular lunch program, including bake sales, holiday parties and treats dished out to reward academic achievement. But state officials are pushing schools to expand the ban 24/7 to include evening, weekend and community events such as banquets, door-to-door candy sales and football games.
Unemployment Rate in Europe Hits 15-year High:
Is this Where America Is Headed?
By Michael Lombardi, MBA for Profit Confidential
The unemployment rate in the eurozone reached a 15-year high in March at 10.9%, up from the previous record set just a month earlier at 10.8% (source: The Guardian, May 2, 2012). This is the highest unemployment rate since the inception of the eurozone.
March 2012 marks the 11th month in a row that the unemployment rate has increased among the 17 nations that make up the eurozone.
THE CRUMBLING MORAL INFRASTRUCTURE If 99% of us were like Occupy mobs,
we wouldn't have a country
By Thomas Sowell - WND.com
The "Occupy" movement, which the Obama administration and much of the media have embraced, has implications that reach far beyond the passing sensation it has created.
The unwillingness of authorities to put a stop to their organized disruptions of other people's lives, their trespassing, vandalism and violence is a de facto suspension, if not repeal, of the 14th Amendment's requirement that the government provide "equal protection of the laws" to all its citizens.
Social(ist) bleeding-heart progressive/liberal solutions;
let someone else pay... End Student Debt! Total debt now exceeds $1 trillion. We should write off existing debt and make public college free.
Social(ist) bleeding heart liberal solutions
The Editors - TheNation.com
The student loan crisis finally reached center stage in Washington after the House GOP budget called for letting interest rates double on government-subsidized loans (and for deep cuts in Pell grants and other student support). If it passes, students who borrow the maximum will end up paying as much as $1,000 a year in added interest. President Obama sensibly called for extending the lower rate, stumping at colleges and on talk-shows to enlist students and others in the cause.
Republican leaders quickly realized the perils of angering young voters. In another flip-flop, Mitt Romney decided to support extending the lower rate, while the House GOP passed an extension but taunted the president by stipulating that it be paid for with money taken from the preventive health fund created by the Affordable Care Act. Senate Democrats propose paying for it by closing a loophole that doctors, lawyers and small businesses use to avoid payroll taxes.
Soros' special interests... buying the election... Liberals Steer Outside Money to Grass-Roots Organizing
By NICHOLAS CONFESSORE - NYTimes.com
After months on the sidelines, major liberal donors including the financier George Soros are preparing to inject up to $100 million into independent groups to aid Democrats' chances this fall. But instead of going head to head with the conservative "super PACs" and outside groups that have flooded the presidential and Congressional campaigns with negative advertising, the donors are focusing on grass-roots organizing, voter registration and Democratic turnout.
White House Again Threatens SCOTUS on Obamacare The Obama administration attempts to bully the Court with a brazen lie about Medicare.
By DAVID CATRON - The American Spectator.org
Last month, having watched in frustration as his Solicitor General got his clock cleaned during the Supreme Court's Obamacare hearings, the President made matters worse by publicly braying about how "unprecedented" it would be for an "unelected group of people" to overturn a law passed by a "strong majority" in Congress. This idiotic assertion provoked a tsunami of scorn from constitutional experts of all stripes, and angered the judges of the Fifth Circuit Court of Appeals so much that they humiliated the lawyers of the Justice Department by giving them a homework assignment on judicial review. If, however, you thought that embarrassing episode was enough to stop the Obama administration from trying to bully the Court, you were mistaken.
Colorado civil unions bill
gains more Republican support, will clear final committee
By Lynn Bartels - The Denver Post
An Evergreen Republican says she will vote for a civil unions bill next week when it gets to her committee, paving the way for it to be heard by the entire House.
Rep. Cheri Gerou said she committed at the start of the session to supporting Senate Bill 2, which allows same-sex couples to enter into civil unions.
Two House committees, Judiciary and Finance, this week voted for the measure, each time with a lone Republican joining Democrats in support.
Republican to revive lightbulb war
By Andrew Restuccia - TheHill.com
A House Republican is planning in the coming weeks to revive the GOP offensive against federal lightbulb efficiency standards.
Rep. Michael Burgess (R-Texas) will offer an amendment to Energy Department spending legislation that would block funding for implementation of the standards, the lawmaker's office told The Hill. The standards have come under fire from conservatives in recent years.
Republicans won the inclusion of a similar provision in an omnibus spending compromise that House and Senate lawmakers agreed to in December. The provision blocked funding for implementation of the law for fiscal year 2012. Burgess' amendment would apply to fiscal year 2013.
Web War II: What a future cyberwar will look like
By Michael Gallagher - BBC World Service
How might the blitzkrieg of the future arrive? By air strike? An invading army? In a terrorist's suitcase? In fact it could be coming down the line to a computer near you.
Operation Locked Shields, an international military exercise held last month, was not exactly your usual game of soldiers. It involves no loud bangs or bullets, no tanks, aircraft or camouflage face-paint. Its troops rarely even left their control room, deep within a high security military base in Estonia.
These people represent a new kind of combatant - the cyber warrior.
Survivor of Tucson shooting rampage
presses Issa for stronger gun laws
By Jordy Yager - TheHill.com
Rep. Darrell Issa (R-Calif.) is getting pressured by a survivor of the Tucson, Ariz., shooting to strengthen the country's gun laws.
A survivor of the shooting that wounded former Rep. Gabrielle Giffords (D-Ariz.) and killed six others, wrote Issa a letter pressing him to devote his powerful committee resources towards revamping firearms statutes when he is done investigating a botched gun-tracking operation, known as "Fast and Furious."
New Threats for Old
BY JR NYQUIST - FinancialSense.com
Once upon a time the Cold War and the threat of nuclear annihilation helped to maintain a certain focus. America and its European allies were supposedly upholding capitalism and freedom against Soviet Communism. Then the Soviet Union broke apart and we got our hands on the "peace dividend." Money could be diverted from weapons to social programs. The West was free to pursue its own socialism – leading to bankruptcy.
In 1990 a Soviet dissident named Sergei Grigoryants, who was twice imprisoned by the KGB, gave a speech in which he warned of the deceptive reality behind of the collapse of Communism. According to Grigoryants, "Perestroika was a giant project undertaken by the KGB and the Soviet leadership for over 15 years." Such a project, undertaken by a totalitarian power, could not result in something good. Real democracy was not a Communist goal. Instead, Grigoryants suggested, Russia would be treated to a new type of totalitarianism.
Muddle in the Middle Kingdom
By Sol Sanders - Special to The Washington Times
Chen Guangcheng and Bo Xilai represent the two poles of the Chinese political spectrum. Mr. Chen is a blind, self-taught lawyer and provincial activist for human rights who finds himself in a life-and-death struggle to reinterpret the system.Mr. Bo is a pampered scion of a famous Communist family, until recently a successful party apparatchik taking full advantage of systemic corruption but who is now facing censure.
Still, there are similarities between the two men. Both now likely face obscurity: Mr. Bo as a cashiered bureaucrat caught in the toils of his wife's "business" deals, which apparently included murdering a foreign businessman. Mr. Chen, by following dozens of other human rights heroes exiled to the West where, like them, he henceforth will exert little influence on events inside the Middle Kingdom.
In India, Hillary Clinton urges an end to oil imports from Iran New Delhi must avoid the "devastating" effect of an Iranian atomic bomb on the world. During an official visit, the US secretary of state says India's slowness in reducing trade with Iran is unacceptable. Iran supplies 12 per cent of India's oil needs.
AsiaNews.it
Kolkata (AsiaNews/Agencies) - US Secretary of State Hillary Clinton urged India to do more to reduce Iranian oil imports, saying that it could be "devastating" for the world if Tehran developed a nuclear bomb. She arrived in Kolkata (West Bengal) yesterday on a three-day visit and in the capital New Delhi, where she spoke again about the embargo on Iranian oil.
Clinton hopes for deal over Iran and oil during India visit US secretary of state aims to re-energise relations between Delhi and Washington which have cooled in recent times
By Jason Burke in Delhi - Guardian.co.uk
Hillary Clinton has arrived in India hoping to press the south Asian power to cut back its consumption of Iranian oil and to reinvigorate relations which, after many years of rapid improvement, have flagged.
Clinton arrived from Bangladesh where she spoke out in support of Mohamed Yunus, the founder of the microcredit pioneer Grameen Bank, who has been under pressure from the government.
She also called for the release of a senior opposition leader who is thought to be held by security services and for an investigation into the death of a trade unionist last month.
Al Qaeda Bomb Plot Against US-Bound Jet Reportedly Foiled
By MATT APUZZO - AP - HuffingtonPost.com
WASHINGTON (AP) — The CIA thwarted an ambitious plot by al-Qaida's affiliate in Yemen to destroy a U.S.-bound airliner using a bomb with a sophisticated new design around the one-year anniversary of the killing of Osama bin Laden, The Associated Press has learned.
The plot involved an upgrade of the underwear bomb that failed to detonate aboard a jetliner over Detroit on Christmas 2009. This new bomb was also designed to be used in a passenger's underwear, but this time al-Qaida developed a more refined detonation system, U.S. officials said.
Security Bank fails, Banesco snaps it up
by Brian Bandell - South Florida Business Journal
North Lauderdale-based Security Bank N.A. failed on Friday and the Federal Deposit Insurance Corp. awarded its assets and branches to Coral Gables-based Banesco USA.
The seizure of the bank by the Office of the Comptroller of the Currency was not a surprise, as Security Bank was in "critically undercapitalized" status on March 31 after suffering repeated losses. The bank received a prompt corrective action order from the OCC in March that warned it to raise capital soon – something the bank could not accomplish.
Shattering the American dream:
The US government's Ponzi scheme
By Richard Evans, Laurence J. Kotlikoff,
and
Kerk L. Phillips - VoxEU.org
The sustainability of government finances is very much the topic of the day. But the issue poses serious questions for the future, particularly how well off today's younger generations will be compared with their parents. This column argues that the Ponzi scheme being played by the US government amounts to "fiscal child abuse" and is close to game over. For today's children the American dream will be just that – a dream.
Fiscal sustainability and generational equity are two of the most pressing policy issues of our times. Yet these two highly related concerns are difficult to clearly define, let alone measure.
The standard metric of long-term fiscal imbalance is official government debt (Reinhart and Rogoff 2009). But, as shown in Green and Kotlikoff (2009), official debt, like time and distance in physics, is not a well-defined economic concept.
Ron Paul taking end-Fed bill before panel Panel to consider bill that would remove five members from FOMC
By Ronald D. Orol, MarketWatch
WASHINGTON (MarketWatch) — A House panel led by longtime Federal Reserve critic Rep. Ron Paul will take direct aim at the central bank next week when it considers a bill to abolish the powerful institution.
The legislation will be among a handful of bills that will be looked at on Tuesday by the congressional committee that could all spell significant change to — if not outright elimination of — the Federal Reserve.
China Buys Gold…No Matter Who's Selling
By Eric Fry - DailyReckoning.com
05/04/12 Laguna Beach, California – Someone is selling in size…Someone is buying in size. That's what makes markets, as the saying goes. But that's also what makes market manipulations, according to the bloggers at Zero Hedge.
The seller in this case is very large and very sloppy, perhaps intentionally so. The buyer is also very large, but very patient and methodical. Trapped between these two powerful opposing market participants we find a "range-bound" gold market. Let's take a closer peek at the curious goings-on…
Gold to touch $2100/oz in Q4 2012: Deutsche Bank
NEW YORK (Commodity Online): Gold prices to touch $2,100/ounce in the fourth quarter of this year, said Deutsche Bank, the largest bank in Germany, in a weekly commodities report.
The German bank also added that Gold prices to reach $1,600 an ounce in the second quarter and $1,800 in third.
According to the bank, Central banks are proving to be a powerful source of gold demand, significantly outstripping purchases in previous years.
"We are therefore maintaining are bullish view to the yellow metal," the German bank added.
$10,000 Gold: Nick Barisheff can't hide love for safe haven
TORONTO(Commodity Online): 'The best time to plant a tree is 20 years ago. The second best time is today', says a Chinese proverb, and it is the advice Nick Barisheff, the leading precious metal expert, would give to investors who feel that it is too late to buy gold.
Gold is the most stable form of wealth preservation for over three thousand years, and it still does today, which out performed all other asset classes since 2002, said Nick Barisheff at an event in Toronto earlier this year. Based on official estimates, America's debt is projected to reach $23 trillion in 2015 and, if the correlation remains the same, the indicated gold price would be $2,600 per ounce. However the gold price will be much higher, taking account of the history.
'Civilized People Don't Buy Gold': Berkshire's Munger
By: Margo D. Beller - CNBC.com
Warren Buffett's right-hand man doesn't like gold any more than his boss does, Charles Munger told CNBC Friday on the eve of Berkshire Hathway'sannual meeting.
"Gold is a great thing to sew into your garments if you're a Jewish family in Vienna in 1939," the Berkshire vice chairman said, "but I think civilized people don't buy gold, they invest in productive businesses."
Keiser Report: Mafia vs OWS (ft. Geralde Celente) (E283)
In this episode, Max Keiser and co-host, Stacy Herbert discuss Treasury Secretary Secretary Timothy Geithner is like a monkey who sees no evil, hears no evil, speaks no evil while Wall Street 'elks' are protected by the police from protestor 'wolves.' In the second half of the show Max talks to trends forecaster, Gerald Celente, about economic problems and years of heated geopolitical disputes to come.
Silver: The nature of supply and demand
By Dr Jeffrey Lewis - CommodityOnline.com
Many observers of the silver market have wondered why futures prices for silver seem so low when demand for the physical metal continues to increase in the face of an ever dwindling supply of the precious and industrial metallic commodity.
In essence, the economic model of price determination by supply and demand factors would seem to indicate a considerably higher equilibrium price for silver than what is currently prevailing.
U.S. presses China over currency during economic talks
By Christopher Bodeen - AP -WashingtonTimes.com
BEIJING (AP) — U.S. Treasury SecretaryTimothy F. Geithner urged Beijing to let its tightly controlled currency strengthen and open its markets wider amid trade strains at a high-level economic dialogue Thursday.
Chinese officials denied the yuan is undervalued and pressed Washington to ease controls on exports of high-tech goods.
Hedge Funds Betting Against the Eurozone:
Why You Should Worry
By John Grgurich, The Motley Fool - DailyFinance.com
Some of the world's most prominent hedge fund managers are betting against the eurozone -- and not just the peripheral countries everyone knows are in trouble. They're taking positions against the core countries, economies that -- until now -- everyone has assumed were rock-solid.
Here's a primer on the world of hedge funds and why the latest developments in the recently resurgent eurozone crisis are yet another warning shot across America's economic bow.
Greek elections to usher in anti-bail-out parties
BY VALENTINA POP - EUObserver.com
BRUSSELS - Greece's two main parties are set for heavy losses in Sunday's (6 May) elections, with anti-bail-out groups on the extreme left and right to enter parliament for the first time, raising again the prospect of an exit from the eurozone.
Public anger at the austerity measures linked to the second, €130 billion strong bail-out package could translate into a new Parliament unable to form a ruling coalition and a new round of elections being called in the next months.
Draghi: euro countries to lose even more sovereignty
BY VALENTINA POP - EUObserver.com
BRUSSELS - European Central Bank (ECB) chief Mario Draghi has urged eurozone leaders to come up with a 10-year target for the common currency, saying they should accept more transfer of powers if they truly want a fiscal union.
Held exceptionally in Barcelona instead of the ECB headquarters in Frankfurt, the monthly meeting of eurozone's central bank governing council on Thursday (3 May) was an opportunity for Draghi to explain what he meant last week when he said a "growth compact" is needed along with the deficit-cutting measures taken by most governments.
France Goes With the Socialist
Truthdig.com
The austerity regime in Europe took a big hit Sunday, with French voterselecting Socialist Francois Hollande, while the Greeks, also voting Sunday, handed out pink slips to the ruling centrist coalition that has slashed government spending on EU orders.
Hollande will be the first left-leaning leader of France in 17 years, an awful long drought considering the country's reputation as a social democracy.
Votes are still being counted as of this posting, but President Nicolas Sarkozy has already conceded.
Hollande ousts Sarkozy in French vote Muddled Greek parliamentary vote may steal spotlight
By William L. Watts, MarketWatch
FRANKFURT (MarketWatch)—French President Nicolas Sarkozy on Sunday became the latest in a long line of European leaders to lose his job in the wake of the euro-zone debt crisis, conceding defeat to Socialist challenger François Hollande after polls closed in the final round of France's presidential election.
Hollande, 57, said the vote marked a turn against a focus on austerity in response to Europe's long-running sovereign debt crisis.
"Austerity is not an inevitability," Hollande told supporters in Tulle in central France, saying the election marks a "new start" for Europe.
Au Revoir Sarkozy: Hollande wins French presidency
Francois Hollande has ousted Nicolas Sarkozy from the French presidency - to become the country's first Socialist president in 17 years. It was a close call - winning 51 per cent of votes to his rival's 49. Our correspondent Tesa Arcilla has been witnessing the wild celebrations at Socialist Party headquarters in Paris.
Radical left and neo-Nazis score well in Greek elections
BY VALENTINA POP - EUObserver.com
BRUSSELS - Greek voters on Sunday (6 May) punished the two ruling parties responsible for the last EU bail-out and its austerity measures by giving the radical left the second highest number of votes and allowing a neo-Nazi party into the legislature for the first time.
Early official results after 10 percent of the votes were count show that the centre-right New Democracy party has gained the most votes (19.2%) but it is not enough to re-make the current ruling coalition with the Social Democrats (Pasok).
Rising euro risks could put Gold
in euro terms back into focus: UBS
LONDON (Commodity Online): Gold in euro terms could be back into focus in the coming weeks due to rising euro risks, said Union Bank of Switzerland (UBS) in a commodity briefing.
In particular, the Swiss bank points to Greek elections Sunday. Whereas the base scenario is for the two main Greek parties to form a coalition government, alternatives are possible as smaller parties, which have rejected a memorandum of understanding with official-sector lenders, are gaining support in opinion polls.
Silver: The nature of supply and demand
By Dr Jeffrey Lewis - CommodityOnline.com
Many observers of the silver market have wondered why futures prices for silver seem so low when demand for the physical metal continues to increase in the face of an ever dwindling supply of the precious and industrial metallic commodity.
In essence, the economic model of price determination by supply and demand factors would seem to indicate a considerably higher equilibrium price for silver than what is currently prevailing.
Currency Debasement and Social Collapse
Mises Daily: by Ludwig von Mises
Knowledge of the effects of government interference with market prices makes us comprehend the economic causes of a momentous historical event, the decline of ancient civilization.
It may be left undecided whether or not it is correct to call the economic organization of the Roman Empire capitalism. At any rate it is certain that the Roman Empire in the 2nd century, the age of the Antonines, the "good" emperors, had reached a high stage of the social division of labor and of interregional commerce. Several metropolitan centers, a considerable number of middle-sized towns, and many small towns were the seats of a refined civilization.
Inflation or Hyperinflation?
FOFOA.Blogspot.com
Remember my post around this same time last year titled Deflation or Hyperinflation? At that time, the debate between deflation and hyperinflation was all the rage, and so I wrote a post to a prominent and long-time deflationist named Rick Ackerman, who later stopped by in the comments. In fact, most of my hyperinflation posts have been written in the context of the deflationists' arguments.
I can't say that the debate has shifted from deflation to inflation over the last year, but it sure seems that the arguments coming across my desk these days are for rising inflation with the exclusion of hyperinflation. My position hasn't changed. But this does give me the opportunity to present my position against a different premise, that of inflation without currency collapse. I would guess that some of you will have a completely different view of hyperinflation by the time you finish this post. If so, please let me know in the comments.
The Inflation Threat Is a Bogeyman Here's the one number that proves
that inflation isn't "really" 10 percent.
By Matthew O'Brien - TheAtlantic.com
British celebrity historian and Harvard professor Niall Ferguson thinks inflation is "really" much higher than its official number. So does celebrity politician and self-styled Austrian economist Ron Paul. And then there's John Williams of Shadow Stats. He too warns of double-digit inflation -- but curiously takes payments for his newsletter in dollars. Even more curiously, he hasn't increased its price in years.
There's just one problem with the inflation monster. It's not real.
The U.S. economy has added 1.9 million jobs over the past 12 months. That number is the best indicator that inflation isn't 10 percent. Here's why.
The Value of Worthless Money An exhibit considers the politics and art of inflation.
By Raquel Laneri - TheDailyBeast.com
The worse a nation's economy, the more inflated its currency.
That's one of the takeaways from Signs of Inflation, a new exhibition at the Federal Reserve Bank of New York. The show, presented by the American Numismatic Society, looks at the history of inflation through the 7th century B.C. to present day. (Yes, even Ancient Rome experienced inflation—it needed to finance those wars.) Signs of Inflation includes almost 200 monetary objects, ranging from engraved gold coins and cowrie shells to twisted iron rods and handwritten IOUs. But it also demonstrates the myriad, complex ways a bank note—or coin, shell, or what have you—reveals a society's political and economic health. And it does so through treating money as partly an objet d'art.
The Recession's Invisible Victim Is Trust
By Megan McArdle - TheAtlantic.com
Part of growing up is having the scales fall from your eyes. My parents raised me to be honest, and I think they did a pretty good job of it. Somehow I got the idea that almost everyone else was the same way. A few bad apples, sure. But a whole bunch?
Eventually I learned that quite a lot of people lie, hold back key truths, and steal. Just one story: At the information desk at the Louvre, the polyglot receptionist told me, "Actually, about half of all lost cameras are returned!" She saw that as a good sign. I took it as evidence that Lex Luthor had it right: "People are no damn good."
Loophole in US Sanctions Allows China
to Trade Gold for Iranian Oil
By James Burgess - OilPrice.com
As we all know by now, at the end of 2011 President Obama signed an act to impose trade sanctions on Iran in an effort to force economic pressure on the Persian nation with the hope that they will halt their nuclear enrichment program. The sanctions will punish any foreign financial institution which conducts transactions with Iran for its crude oil by cutting off that institution from the US financial system. The sanctions officially take effect on the 28th of June this year.
China is Tehran's largest customer, investor, and trading partner, and will find it impossible to significantly reduce that position enough to earn a waiver from the US sanctions. Geopolitically it backs Iran, but its economy is also heavily reliant upon the US economy; it cannot afford to halt all trade with Iran, nor be banned from the US financial system.
How economists have misunderstood inequality:
An interview with James Galbraith
by Brad Plumer - WashingtonPost.com
Before 1980, few academics in the United States gave much thought to the idea of economic inequality. It just wasn't a glaring concern. But in the last 30 years, the incomes of the nation's wealthiest 1 percenthave surged, and more and more economists have been paying attention.
Yet there's still plenty about economic inequality that's not well understood. What's actually driving the gap between the richest and poorest? Does it hurt economic growth, or is it largely benign? Should it be reversed? Can it be reversed? Surprisingly, there's little consensus on how to answer these questions — in part because good data on the topic is hard to come by.
New American Dream is Renting;
Reflections on Renting Houses, Cars, Books, Clothes;
Will Rentership Fuel the Next Boom?
What About Home Prices?
By Mike Shedlock - GlobalEconomicAnalysis.Blogspot.com
Housing has now gone full circle. President Bush's "Ownership Society" has morphed into the "Rentership Society". The attitude applies to more than houses as noted in the Wall Street Journal article Renting Prosperity by Daniel Gross.
Americans are getting used to the idea of renting the good life, from cars to couture to homes. Daniel Gross explores our shift from a nation of owners to an economy permanently on the move—and how it will lead to the next boom.
Keiser Report: Bribe Masters on Shopping Spree (E284)
In this episode, Max Keiser and co-host, Stacy Herbert discuss how a good morning for Vietnam turned out to be a bad day for America as more families moving into self-storage units while Chinese are spending big money on European shopping sprees. In the second half of the show Max talks to Reggie Middleton of BoomBustBlog about the tech sector and austerity versus stimulus.
Jobs Engine Sputters Again in April Weak Employment Data
Put Pressure on Obama's Pitch of Economic Rebound
By CONOR DOUGHERTY , BEN CASSELMAN
and LAURA MECKLER - WSJ.com
U.S. job growth slowed in April, spooking markets and giving President Barack Obama a tougher sell as he tries to convince voters that the economy is on the mend.
The disappointing jobs report raised concerns that the economy, which appeared to be accelerating late last year and early this year, is bogging down again. The labor force shrank again last month, indicating more workers are throwing in the towel.
Fewer jobs means more spending on U.S. Medicaid
(Reuters) - Millions of people turned to the Medicaid health insurance program for the poor during the 2007-2009 recession as families coped with job losses and drastic drops in income, pushing Medicaid spending up by an average of 6.6 percent per year, according to a study released on Friday.
The study by the nonprofit Kaiser Foundation found that state and federal spending on the program, which states administer with partial reimbursements from the U.S. government, grew to $400 billion in 2010 from $330 billion in 2007.
With Jobs Few, Internships Lure More Graduates to Unpaid Work
By: Steven Greenhouse, The New York Times - CNBC.com
Confronting the worst job market in decades, many college graduates who expected to land paid jobs are turning to unpaid internships to try to get a foot in an employer's door.
While unpaid postcollege internships have long existed in the film and nonprofit worlds, they have recently spread to fashion houses, book and magazine publishers, marketing companies, public relations firms, art galleries, talent agencies — even to some law firms.
Unsheltered homelessness soars in Denver
Denver Business Journal
An annual survey shows an increase of the Denver area's homeless population from a year earlier, with the number of homeless people sleeping without shelter more than doubling.
The annual "Homeless Point-In-Time Study" has been produced by the Metro Denver Homeless Initiative since 1998. The study is compiled on a single night -- in this case, Jan. 23, 2012 -- by staffers from various agencies and volunteers who fan our around the area, counting and interviewing homeless people.
Hiring slows, spells trouble for economy, Obama
By Jason Lange
(Reuters) - Employers cut back on hiring in April and more people stopped looking for work, troubling signs for President Barack Obama whose re-election prospects could hinge on his handling of the economy.
Employers added 115,000 workers to payrolls last month, the Labor Department said on Friday. It was the third straight month in which hiring had slowed, intensifying fears the U.S. recovery is losing momentum.
Postal Service: House must act to stem mail losses
By Hope Yen - AP - WashingtonTimes.com
WASHINGTON — With financial losses mounting, the nearly bankrupt U.S. Postal Service is urging the House to quickly pass legislation that would give it wide authority to close thousands of low-revenue post offices, reduce labor costs and end Saturday delivery.
At its meeting Friday, the Postal Service's board of governors said that a bill passed by the Senatelast week doesn't go far enough to give the agency the latitude it needs. That bill would provide the Postal Service with an $11 billion cash infusion to help pay down ballooning debt but halt the immediate closing of up to 252 mail-processing centers and 3,700 post offices.
Adobe patches new Flash zero-day bug with emergency update In-the-wild attacks target Windows' Internet Explorer,
says company
By Gregg Keizer - Computerworld.com
Computerworld - Adobe today warned that hackers are exploiting a critical vulnerability in its popular Flash Player program, and issued an emergency update to patch the bug.
"There are reports that the vulnerability is being exploited in the wild in active targeted attacks designed to trick the user into clicking on a malicious file delivered in an email message," the Friday advisory said.
Although all editions of Flash Player contain the vulnerability and should be patched, the active exploit is targeting only users of Microsoft's Internet Explorer (IE).
EU seeks US help to fight cyber criminals
BY NIKOLAJ NIELSEN - EUObserver.com
BRUSSELS - The EU wants to work closer with the United States' department of Homeland Security and the FBI to help plug gaps on protection against cyber crime - a sector worth €388 billion a year in illegal revenue worldwide.
"To overcome this growing global threat, EU-US cooperation is not a choice, but a necessity," EU home affairs commissioner Cecilia Malmstrom told US officials and policy experts at the Center for Strategic and International Studies (CSIS) in Washington on Wednesday (2 May).
Space weather expert has ominous forecast Mike Hapgood, who studies solar events, says the world isn't prepared for a truly damaging storm. And one could happen soon.
By Amina Khan, Los Angeles Time
A stream of highly charged particles from the sun is headed straight toward Earth, threatening to plunge cities around the world into darkness and bring the global economy screeching to a halt.
This isn't the premise of the latest doomsday thriller. Massivesolar storms have happened before — and another one is likely to occur soon, according to Mike Hapgood, a space weather scientist at the Rutherford Appleton Laboratory near Oxford, England.
"We are Preparing for Massive Civil War," Says DHS Informant
by Dominique de Kevelioc de Bailleul - BeaconEquity.com
In a riveting interview on TruNews Radio, Wednesday, private investigator Doug Hagmann said high-level, reliable sources told him the U.S. Department of Homeland Security (DHS) is preparing for "massive civil war" in America.
"Folks, we're getting ready for one massive economic collapse," Hagmann told TruNews host Rick Wiles. Sign-up for my 100% FREE Alerts
"We have problems . . . The federal government is preparing for civil uprising," he added, "so every time you hear about troop movements, every time you hear about movements of military equipment, the militarization of the police, the buying of the ammunition, all of this is . . . they (DHS) are preparing for a massive uprising."
Ron Paul Could Still Win Enough Delegates
To Deny Mitt Romney The Republican Nomination
By Michael Snyder - EndOfTheAmericanDream.com
Despite what you may have heard from the mainstream media, Mitt Romney does not have the Republican nomination locked up. In fact, he is rapidly losing delegates that almost everyone assumed that he already had in the bag. To understand why this is happening, you have to understand the delegate selection process. Each state has different rules for selecting delegates to the Republican national convention, and in many states the "voting" done by the public does not determine the allocation of delegates to particular candidates at all. And the truth is that delegates are the only thing that really matters in this race. In state after state, the Ron Paul campaign is focusing on the delegate selection process with laser-like precision, and it is paying off big time. At this point, there is still a legitimate chance that Ron Paul will be able to win enough delegates to deny Mitt Romney the nomination on the first ballot at the Republican national convention in Tampa. If Romney does not have the 1,144 delegates that he needs on the first ballot, then it becomes a brokered convention and anything becomes possible at that point.
Romney and the White Horse Prophecy A close look at the roots of Romney's --
and the Mormon church's -- political ambitions
BY SALLY DENTON - Salon.com
When Mitt Romney received his patriarchal blessing as a Michigan teenager, he was told that the Lord expected great things from him. All young Mormon men — the "worthy males" of the Church of Jesus Christ of Latter-day Saints, as it is officially known — receive such a blessing as they embark on their requisite journeys as religious missionaries. But at 19 years of age, the youngest son of the most prominent Mormon in American politics — a seventh-generation direct descendant of one of the faith's founding 12 apostles—Mitt Romney had been singled out as a destined leader.
The Book of Mitt Pundits still haven't figured out how to talk about Romney's Mormon religion. Here's everything you need to know
BY ALEX PAREENE - Salon.com
"The precipitous mountain pass that led the [Mormon] pioneers down into the Salt Lake Valley and still is the route of access from the east on Interstate 80, was first explored by my great-grandfather, Parley P. Pratt," Mitt Romney cheerfully writes in "Turnaround," the airport bookstore leadership manual he wrote in 2004 while governor of Massachusetts.
"He had worked a road up along 'Big Canyon Creek' as an act of speculation when his crop failed in the summer of 1849. He charged tolls to prospectors making their way to California at the height of the Gold Rush and even had a Pony Express station commissioned along his pass."
Surveillance State democracy As the FBI seeks full access to all forms of Interent communication, it is not voters who need to be convinced
BY GLENN GREENWALD - Salon.com
CNET's excellent technology reporter, Declan McCullagh, reports on ongoing efforts by the Obama administration to force the Internet industry to provide the U.S. Government with "backdoor" access to all forms of Internet communication:
The FBI is asking Internet companies not to oppose a controversial proposal that would require firms, including Microsoft, Facebook, Yahoo, and Google, to build in backdoors for government surveillance. . . . That included a scheduled trip this month to the West Coast — which was subsequently postponed — to meet with Internet companies' CEOs and top lawyers. . . .
What the FDA Promises to Do About Obesity
Over the Next 5 Years Marion Nestle takes a close look at the FDA's goals around giving consumers more information about the food that they are eating.
By Marion Nestle - TheAtlantic.com
Ordinarily I find government plans of this type to be soporific but this one is especially well written and well thought out (with some caveats).
The report is a statement of FDA commitment to what it is going to do in the next four years in food areas that affect people and animals. It includes many promises, among them this one of particular interest:
Program Goal 4: Provide accurate and useful information so consumers can choose a healthier diet and reduce the risk of chronic disease and obesity.
The Campus Tsunami
By DAVID BROOKS - NYTimes.com
Online education is not new. The University of Phoenix started its online degree program in 1989. Four million college students took at least one online class during the fall of 2007.
But, over the past few months, something has changed. The elite, pace-setting universities have embraced the Internet. Not long ago, online courses were interesting experiments. Now online activity is at the core of how these schools envision their futures.
This week, Harvard and the Massachusetts Institute of Technology committed $60 million to offer free online courses from both universities. Two Stanford professors, Andrew Ng and Daphne Koller, have formed a company,Coursera, which offers interactive courses in the humanities, social sciences, mathematics and engineering. Their partners include Stanford, Michigan, Penn and Princeton. Many other elite universities, including Yale and Carnegie Mellon, are moving aggressively online. President John Hennessy of Stanford summed up the emerging view in an article by Ken Auletta in The New Yorker, "There's a tsunami coming."
get an education without student loans... Harvard and M.I.T. Take Their Classes Online
By AZADEH ENSHA - NYTimes.com
Digital classrooms are a growing field, thanks in no small part to success stories like the Khan Academy, so it's no surprise that traditional brick-and-mortar universities are increasingly looking to add an online element to their learning platforms.
This week Harvard and M.I.T. joined the fray with a $60 million online-classroom venture named edX. The nonprofit enterprise will offer a variety of free courses across disciplines for anyone with an Internet connection.
Adobe patches new Flash zero-day bug
with emergency update In-the-wild attacks target Windows' Internet Explorer
By Gregg Keizer - Computerworld.com
Computerworld - Adobe today warned that hackers are exploiting a critical vulnerability in its popular Flash Player program, and issued an emergency update to patch the bug.
"There are reports that the vulnerability is being exploited in the wild in active targeted attacks designed to trick the user into clicking on a malicious file delivered in an email message," the Friday advisory said.
Although all editions of Flash Player contain the vulnerability and should be patched, the active exploit is targeting only users of Microsoft's Internet Explorer (IE).
Is Facebook use in the enterprise too risky to allow? With an outright ban on social sites nearly impossible, companies need a strong security regime and staff training, say experts
By Taylor Armerding - CSOnline.com
May 04, 2012 — CSO — It is not news that Facebook, the behemoth of social networking, is less than aggressive about protecting the personal privacy of its 900 million users. But even relatively savvy users may not be aware of how much of their information is collected, how it is used and how little control they may have over it.
And with millions of workers now using social networking in their professional as well as personal lives, those privacy risks extend in a very big way to the enterprise.
Consumer Reports, which released its annual report on Internet privacy and security last week, devotes an entire section to "Facebook and your privacy." Its findings may not surprise most CISOs, but will likely be unsettling all the same...
"Facebook gets a report every time you visit a site with a Facebook 'Like' button, even if you never click the button, are not a Facebook user, or are not logged in."
"Even if you have restricted your information to be seen by friends only, a friend who is using a Facebook app could allow your data to be transferred to a third party without your knowledge," ...
Researchers use diamonds to boost computer memory
Pressure from diamonds used to reduce the electrical resistivity of the computer memory
By Lucas Mearian
Computerworld - Johns Hopkins University engineers are using diamonds to change the properties of an alloy used in phase-change memory, a change that could lead to the development higher capacity storage systems that retain data more quickly and last longer than current media.
The process, explained this month in the online edition of Proceedings of the National Academy of Sciences (PNAS), focused on changes to the inexpensive GST phase-change memory alloy that's composed of germanium, antimony and tellurium.
"This phase-change memory is more stable than the material used in current flash drives. It works 100 times faster and is rewritable millions of times," said the study's lead author, Ming Xu, a doctoral student at the Whiting School of Engineering at Johns Hopkins University.
Android malware used to mask online fraud, says expert 'NotCompatible' downloads automatically as soon as an Android user browses to a compromised website, says Lookout
By Gregg Keizer
Computerworld - Android malware being automatically distributed from hacked websites looks like it's being used to mask online purchases, and could be part of a fraud gang's new push into mobile, researchers said today.
"The malware essentially turns your Android phone into a tunnel that can bounce network traffic off your phone," said Kevin Mahaffrey, co-founder and CTO of Lookout Security, a San Francisco-based firm that focuses on Android.
Lookout first published information about the new malware, dubbed "NotCompatible," on Wednesday. Further analysis, however, has revealed the most likely reason why cyber criminals are spreading the malware.
Yahoo informs Facebook of more potential patent infringements Yahoo is already suing Facebook
for alleged infringement of 12 of its patents
By John Ribeiro
IDG News Service - Yahoo is said to have written to Facebook indicating that it believes that 16 patents it claims to hold "may be relevant" to open source technology allegedly being used in the data centers and servers of the social networking company, according to a regulatory filing by Facebook on Thursday.
The Internet company has not threatened or initiated litigation in connection with the matters referred to in the letter of April 23, "but it may do so in the future," Facebook said in the filing.
The Fastest Growing Religion In America Is Islam
By Michael Snyder - EndOfTheAmericanDream.com
Do you know what the fastest growing religion in America is? It isn't Christianity. According to the latest U.S. Religion Census that was just released on May 1, 2012, the fastest growing religion in America is Islam. The data for the census was compiled by the Association of Statisticians of American Religious Bodies, and the results were released by the Association of Religion Data Archives. From the year 2000 to the year 2010, the census found that the number of Muslims living inside the United States increased by about 1 million to 2.6 million - a stunning increase of 66.7 percent. That is an astounding rate of growth. Meanwhile, most Christian denominations had rates of growth that were far below the overall rate of population growth in the United States, and some Christian denominations actually lost members. Sadly, when Barack Obama once said that "we are no longer a Christian nation" he wasn't too far off the mark. Christianity is rapidly losing influence and other religions such as Islam are rapidly gaining members and building new places of worship. As other major religions such as Islam continue to grow in the United States, it is inevitable that this will reshape America in many different ways in the years ahead.
Al Qaeda Magazine Calls for Firebomb Campaign in US
By RANDY KREIDER - ABCNews.com
The men who launched al Qaeda's English-language magazine may have died in a U.S. missile strike last fall, but "Inspire" magazine lives on without them -- and continues to promote jihadi attacks on Western targets, offering detailed advice on how to start huge forest fires in America with timed explosives and how to build remote-controlled bombs.
Two new issues of "Inspire" magazine have surfaced on jihadi forums, the first since radical cleric Anwar al-Awlaki and chief Al Qaeda in the Arabian Peninsula propagandist Samir Khan were killed by missiles from a U.S. drone over Yemen on September 30, 2011. The magazines eulogize Awlaki and Khan as the "spirit" and the "tongue" of "Inspire" respectively, but deny that their deaths will stop the magazine or jihad
Taliban stronger than before U.S. troop surge: lawmakers
(Reuters) - The Taliban is stronger now than before President Barack Obama ordered a surge of troops to Afghanistan, two senior U.S. lawmakers said on Sunday, contradicting the administration's assessment of the insurgency.
"I think we both say that what we found is the Taliban is stronger," Senate Intelligence Committee Chairwoman Dianne Feinstein told "Fox News Sunday" in an interview that included House Intelligence Committee Chairman Mike Rogers, who agreed with her statement. The two lawmakers returned last week from a trip to Afghanistan..
The Most Important Economic Story Nobody is Talking About
By Matthew O'Brien - TheAtlantic.com
Behind every great president stands a great central banker. Ronald Reagan had Paul Volcker. Dwight Eisenhower had William McChesney Martin. And FDR had, well, FDR.
There's a corollary. Behind every great central banker stands a great central banking committee. Or at least a pliant one. It's this latter reality that President Obama still has not quite recognized. And this malign neglect of most matters monetary has added a wholly unnecessary degree-of-difficulty to the economic recovery.
Here's a depressing reminder: We're in a $1 trillion hole. That's how much income we have been losingevery year since the onset of the Great Recession. Ben Bernanke and Co. have done a good job preventing a full-on replay of the Great Depression, but Ben Bernanke and Co. have not done a good job preventing a lost decade. The key phrase here is "and Co."
States To Use Gold And Silver As Legal Tender
By Susanne Posel, Contributor - Activist Post
As America slips into monetary oblivion, some states are turning to the US Constitutional right and desiring to use alternative currencies – preparing for the hyper-inflation that Bernanke is currently creating.
Minnesota, Tennessee, Iowa, South Carolina and Georgia are awaiting approval from their respective governments to create a separate currency. This number is up from 2011, when just 3 states were brave enough to attempt this constitutional right.
More Americans Stashing Cash in Home Safes Have Americans lost trust in banks?
More folks are keeping valuables at home,
whether in room-size vaults or under-bed safes.
By CHARLES PASSY - SmartMoney.com
When Carlos Felipe decided to shop for the ultimate night's sleep, he headed to the New Jersey showroom of Hollandia, an Israeli manufacturer that creates custom beds running as much as $35,000. And sure enough, Felipe, a sales representative, found plenty of appealing features and options, from the adjustable bed frame powered by German-made motors to the hypoallergenic, antimicrobial latex mattress (the cover is "treated with aloe vera for a soft feel," Hollandia boasts). But the accessory that most caught Felipe's eye was designed to help him rest easy in a different way. It was a small safe, good for holding a few valuables or gold coins, ingeniously built into the base of a bed -- a modern-day answer to the idea of stashing your savings under a mattress. A duly impressed Felipe plans on using it to store his wife's jewelry and some extra cash: After all, he asks, what thief would look for such valuables in the frame of the bed itself?
Why a More Flexible Renminbi Still Matters
By Kenneth Rogoff - Project-Syndicate.org
CAMBRIDGE – One of the most notable macroeconomic developments in recent years has been the sharp drop in China's current-account surplus. The International Monetary Fund is now forecasting a 2012 surplus of just 2.3% of GDP, down from a pre-crisis peak of 10.1% of GDP in 2007, owing largely to a decline in China's trade surplus – that is, the excess of the value of Chinese exports over that of its imports.
The drop has been a surprise to the many pundits and policy analysts who view China's sustained massive trade surpluses as prima facie evidence that government intervention has been keeping the renminbi far below its unfettered "equilibrium" value. Does the dramatic fall in China's surplus call that conventional wisdom into question? Should the United States, the IMF, and other players stop pressing China to move to a more flexible currency regime?
Keiser Report: How bankers stole Labor Day (E282)
In this episode, Max Keiser and co-host, Stacy Herbert discuss the bull market in discontent, MF Global clients begging JP Morgan for their money back, Zynga insiders dumping shares in an 'innovative' manner and Max does a mean impersonation of Jamie 'Pick a pocket or two' Dimon. In the second half of the show Max talks to activist Andy Stepanian about animal rights activism, Occupy Wall Street and the dangers of success against corporations.
Why the Eurozone Debt Crisis Never Really Went Away
BY DAVID ZEILER, Associate Editor, Money Morning
How many times have we been told the Eurozone debt crisis is resolved, only to have it turn up again like a bad penny?
Last year's string of good news/ bad news on the Eurozone debt crisis had the markets going up and down like a yo-yo until the routine grew so tiresome that most people stopped paying attention.
But while the crisis faded into the background, it never really went way.
Remedies that were sold as solutions haven't solved a thing.
The euro crisis just got a whole lot worse With Europe plunging back into recession and unemployment soaring, Francois Hollande, the French presidential candidate, is calling for growth objectives to be reprioritised over the chemotherapy of austerity.
By Jeremy Warner - Telegraph.co.uk
Angela Merkel, the German Chancellor, has meanwhile continued to insist that on the contrary, Europe must persist with the hairshirt. What's needed is political courage and creativity, not more billions thrown away in fiscal stimulus. Stick with the programme, she urges, as the anti-austerity backlash reaches the point of outright political insurrection.
Hollande and Merkel are, of course, both wrong. What Europe really needs is a return to free-floating sovereign currencies. Only then will Europe's seemingly interminable debt crisis be lastingly resolved. All the rest is just so much prancing around the goalposts, or an attempt to make the fundamentally unworkable somehow work.
EU PLOT TO SCRAP BRITAIN
By Macer Hall - Express.co.uk
SENIOR Eurocrats are secretly plotting to create a super-powerful EU president to realise their dream of abolishing Britain and other nation states, the Daily Express can reveal.
A covert group of EU foreign ministers has drawn up plans for merging the jobs currently done by Herman Van Rompuy, president of the European Council, and Jose Manuel Barroso, president of the European Commission.
G-8 move puts protest plans in flux With only NATO in town, marches should be smaller
By Tammy Webber - AP - WashingtonTimes.com
CHICAGO — The stage seemed set for an epic showdown: G-8 and NATO leaders planned to hold back-to-back summits in Chicago that activists predicted could draw tens of thousands of people protesting everything from war in Central Asia to unemployment and education cuts at home.
But at the last minute, President Obama moved the Group of Eight economic meeting to Camp David, the secluded presidential retreat in Frederick County, Md., where demonstrators will be kept far away. Chicago kept the NATOmeeting, which will focus on the war in Afghanistan and other international security matters - not the economy.
Can Big U.S. Banks Escape Europe's Malaise?…
Meredith Whitney Chimes In
247WallSt.com
The financial sector was the best performing index out of the S&P 500 during the first quarter. That was when investors were decoupling from the woes of Europe. With European bank shares falling now that European nations are back front and center, the obvious fear is that the big US banks are going to get pulled down much further as their brethren get pummeled overseas.
Fed's Lacker: Likely Need To Raise Rates In 2013
[Google title for free article pass]
By MICHAEL R. CRITTENDEN - WSJ.com - $$
NORFOLK, VA (Dow Jones)--Additional easing by the Federal Reserve isn't a cure-all for the uneven U.S. recovery, Federal Reserve Bank of Richmond President Jeffrey Lacker said Wednesday, insisting that interest rates will likely need to be raised next year despite recent indications the economy may be hitting a soft spot.
Lacker, who has dissented from his colleagues at all three Fed meetings this year, said further efforts by the central bank to stimulate the economy are unlikely to be of much help. While he acknowledged the economic hardship being felt by many Americans, particularly as unemployment remains above 8%, Lacker said there is little the Fed can do.
Our central bankers are intellectually bankrupt
By Ron Paul - FT.com
The financial crisis has fully exposed the intellectual bankruptcy of the world's central bankers.
Why? Central bankers neglect the fact that interest rates are prices. Manipulating those prices through credit expansion or contraction has real and deleterious effects on the economy. Yet while socialism and centralised economic planning have largely been rejected by free-market economists, the myth persists that central banks are a necessary component of market economies.
These economists understand that having wages or commodity prices established by government fiat would cause shortages, misallocations of capital and hardship. Yet they accept at face value the notion that central banks must determine not only the supply of one particular commodity – money – but also the cost of that commodity via the setting of interest rates.
The Corporate-Tax Conundrum
by Laura Tyson - Project-Syndicate.org
BERKELEY – The United States now has the highest statutory corporate-income tax rate among developed countries. Even after various deductions, credits, and other tax breaks, the effective marginal rate – the rate that corporations pay on new US investments – remains one of the highest in the world.
In a world of mobile capital, corporate-tax rates matter, and business decisions about how and where to invest are increasingly sensitive to national differences. America's relatively high rate encourages US companies to locate their investment, production, and employment in foreign countries, and discourages foreign companies from locating in the US, which means slower growth, fewer jobs, smaller productivity gains, and lower real wages.
Goldman Sachs May Play Pivotal Role in American's Fate
By Jeffrey McCracken, Mary Schlangenstein
and Zachary R. Mider - Bloomberg.com
Goldman Sachs Group Inc. may emerge as a pivotal participant in deciding the fate of AMR Corp. (AAMRQ)'s American Airlines in bankruptcy.
The firm, an AMR bondholder, is among creditors being lobbied by US Airways Group Inc. (LCC) to back a possible takeover bid, said people with knowledge of the matter. Goldman Sachs has encouraged other debt investors to meet with US Airways to see if a merger would recoup more than AMR's stand-alone plan, said one person, who asked for anonymity because details are private.
Paul Craig Roberts -
Progressive News Hour - April 26, 2012
The Progressive Radio News Hour is a cutting-edge program featuring distinguished guests daily discussing major world and national issues in depth.
Roberts was former Assistant Treasury Secretary under Ronald Reagan, a Wall Street Journal Associate Editor, and holder of numerous academic appointments, including at Georgetown University's Center for Strategic and International Studies.
He now prominently criticizes destructive, repressive state policies, harming people everywhere.
Major world and national issues will be discussed.
Goldman's Hawker Beechcraft Files for Bankruptcy Protection
By Dawn McCarty and Michael Bathon - Bloomberg.com
Hawker Beechcraft Inc., the private- jet maker owned by Goldman Sachs Group Inc. (GS) andOnex Corp. (OCX), sought bankruptcy protection after agreeing to a restructuring plan that will reduce debt by about $2.5 billion.
Hawker, bought for $3.3 billion in 2007, listed more than $1 billion in assets and debt in Chapter 11 documents filed today in U.S. Bankruptcy Court in Manhattan. The company reported net losses totaling more than $900 million in the past two years as U.S. military contracts and plane sales declined.
All Signs Point To Lost Decade: Krugman and Summers
By MERRILL GOOZNER, The Fiscal Times
Amid new signs that Europe is in a double-dip recession and U.S. job growth is faltering, two of the leading macroeconomists of their generation warned Wednesday – in two separate events – that the domestic economy appears headed for a lost decade marred by high unemployment, sluggish growth and rising inequality.
Though one is considered liberal and the other a centrist, Princeton University professor and New York Times columnist Paul Krugman and former National Economic Council chairman Lawrence Summers offered similar diagnoses of what ails the U.S. economy.
Will the rent be too damn high for Bernanke? Rents are soaring, and that's bad news for inflation -- and for Federal Reserve chairman Ben Bernanke's plans to keep it low.
By Nin-Hai Tseng - Fortune.com
FORTUNE – Most of us don't want to pay higher prices, but there's a growing debate over whether we should allow inflation to edge a little higher to help the U.S. economy grow.
Earlier this week, Nobel Prize-winning economist Robert Engle joined fellow prize winner Paul Krugman in building the case for rapidly rising prices. They say it could help reduce joblessness, with Krugman suggesting that the Federal Reserve tolerate inflation of up to 4% to boost the economy. That's about double what Fed Chairman Ben Bernanke has been targeting. Anything higher than that, Bernanke has said, would be "very reckless" and could potentially derail the economic recovery.
Michigan Politicians Turn Blind Eye To Illegal Fannie & Freddie Foreclosures Performed By Trott & Orlans Attorneys Need To Name Them As Co-Defendants In Foreclosure Lawsuits
Steve Dibert, MFI-Miami.com
Over the past year, I've been writing about the shenanigans going on over at Michigan's largest foreclosure mills, Trott & Trott and Orlans Associates in regards to robo-signing and notary fraud. MFI-Miami has now discovered something that calls into question the legitimacy of every Fannie Mae and Freddie Mac foreclosure they have performed in the state of Michigan over the past five years.
Crooks and Criminals in High Places with Gerald Celente 1/3
On the Thursday, May 3 edition of the Alex Jones Show, runs down a leaked U.S. Army document that spells out a plan for re-education camps in America. Alex also talks with trend forecaster Gerald Celente. He is the publisher of the Trends Journal and has predicted a number events that have come to pass, including the Crash of 2009, and warns of social and economic disruptions to come, especially in America. He is the author of Trends 2000: How to Prepare for and Profit from the Changes of the 21st Century and Trend Tracking: The System to Profit from Today's Trends.
Debt inequality is the new income inequality
By Tami Luhby @CNNMoney
NEW YORK (CNNMoney) -- The rich are getting richer, and everyone else is going deeper into debt trying to keep up.
The bottom 95% of Americans have seen debt levels balloon compared to their earnings over the past 20 years or so, as falling incomes made them more dependent on credit to maintain their lifestyles.
In 1983, the bottom 95% had 62 cents of debt for every dollar they earned, according to research by two International Monetary Fund economists. But by 2007, the ratio had soared to $1.48 of debt for every $1 in earnings.
More than 1 in 5 Americans are economically insecure
By Tami Luhby @CNNMoney
NEW YORK (CNNMoney) -- More than one in five Americans saw at least a quarter of their available household income vanish each year during the Great Recession, and they lacked a sufficient financial cushion, according to a report released Monday.
The situation has left them economically insecure, according to the report, which updates an Economic Security Index created by Jacob Hacker, a political science professor at Yale.
There Are 100 Million Working Age Americans
That Do Not Have Jobs
by Michael Snyder - TheEconomicCollapseBlog.com
The unemployment crisis in America is much worse than you are being told. Did you know that there are 100 million working age Americans that do not get up in the morning and go to work? No wonder why it seems like there are so many people that do not have jobs! According to the federal government, there are 12.6 million working age Americans that are considered to be "officially" unemployed, but there are another 87.8 million working age Americans that are not working either. The federal government considers those Americans to be "not in the labor force" so they are not included in the unemployment rate. In fact, this is one of the key ways that the government manipulates the unemployment numbers. The Obama administration would have us believe that the unemployment rate is going down and that that since the start of the last recession about as many Americans have left the labor force as we saw during the entire decades of the 1980s and 1990s combined. Of course that is a bunch of nonsense, but that is what the Obama administration would have us believe.
The 86 million invisible unemployed
By Annalyn Censky @CNNMoney
NEW YORK (CNNMoney) -- There are far more jobless people in the United States than you might think.
While it's true that the unemployment rate is falling, that doesn't include the millions of nonworking adults who aren't even looking for a job anymore. And hiring isn't strong enough to keep up with population growth.
As a result, the labor force is now at its smallest size since the 1980s when compared to the broader working age population.
Job market dropouts Last year, 86 million Americans were not counted in the labor force because they hadn't recently looked for work. Here's what they've been doing instead.
Staying home with the kids
After serving in the Marine Corps for 12 years, I moved back home to San Antonio and eventually found a great position as a compliance coordinator for a trucking company. I worked there for about six years, but once the economy started going downhill, I was laid off.
I found another job as a customer relationship manager, and a year later, I was laid off again.
At first, we kept our baby in daycare, so I could spend every day filling out applications.
NFIB: Small Business hiring was weak in April,
"Outlook improves"
by CalculatedRisk
From the National Federation of Independent Business(NFIB): Job Creation Weakens in April but Prospects Improve
April was another tenuous month for small businesses, sending mixed signals about what the future holds.
"On the job creation front, the news was only fair. The net change in employment per firm (seasonally adjusted) came in at 0.1; this is down from March but still positive...
"The percent of owners reporting hard to fill job openings rose 2 points to 17 percent, one point below the January 2012 reading which is the highest we've reported since June 2008. Hard-to-fill job openings are a strong predictor of the unemployment rate, making the gain in openings a welcome development. The net percent of owners planning to create new jobs is 5 percent, a 5 point increase after taking a plunge in March...
More employers give green light to flexible hours One way this economic slowdown has differed from past recessions: Efforts to help people balance work and family actually increased, says one study.
By Anne Fisher - Fortune.com
FORTUNE -- Business is booming at Harris Allied, a New York City-based recruiting firm that specializes in finding IT talent and quantitative analysts for investment banks and other financial services companies. "Candidates come to us because they want to change jobs, and a lack of balance between work and home life is usually the reason," says managing director Kathy Harris. "People get tired of working 16-hour days. I had one executive tell me he hadn't had dinner with his family in six months."
Now that the job market is showing signs of life again, she adds, "More people are making a move. And, when a key person quits in order to get more balance in their lives, it often comes as a complete surprise to their employer."
College Grads Snub Startups
by Teresa Novellino - Portfolio.com
Never mind that the twentysomething Harvard dropout who started a little company called Facebook is about to take it public at a $100 billion valuation. The allure of working at a startup, à la Mark Zuckerberg, just isn't there for the college graduates in the class of 2012, a new survey finds.
In fact, these soon-to-be-grads value job security above all else, including salary and benefits, and are the least likely of any job-seekers to consider working for a startup, a new SimplyHired.com survey released today finds.
Partisan Politics Damaging American Energy
By Shea Laverty - OilPrice.com
Partisan politics rule the day in America. As much as anyone can try to deny that, the rhetoric coming from either side of the aisle tells a very different story. In one corner, the ever-emboldening Left, who after several years of meek concession-making seem to have finally bared their fangs after gaining some populist support. In the other, the stonewalling Right who seem to have dedicated their entire philosophy to opposing anything and everything they haven't themselves drafted.
So which wing of the American political machine is correct? Should we dump the oil companies into a ravine and ride the solar superhighway, or should we Drill Baby Drill and tap the resources sitting right under the feet (and rumps) of North Americans everywhere?
The Fastest Growing Religion In America Is Islam
By Michael Snyder - EndOfTheAmericanDream.com
Do you know what the fastest growing religion in America is? It isn't Christianity. According to the latest U.S. Religion Census that was just released on May 1, 2012, the fastest growing religion in America is Islam. The data for the census was compiled by the Association of Statisticians of American Religious Bodies, and the results were released by the Association of Religion Data Archives. From the year 2000 to the year 2010, the census found that the number of Muslims living inside the United States increased from 1 million to 2.6 million - a stunning increase of 66.7 percent.
Apple Must Face Lawsuit Over IPhone Data Collection Claims
By Joel Rosenblatt - Bloomberg.com
Apple Inc. must face a lawsuit over claims it collected data from customers' iPhones while they used applications approved by the company, a judge ruled.
U.S. District Judge Lucy Koh in San Jose, California, today dismissed some of the claims in the case while allowing others to proceed to pretrial fact-finding.
"I'm going to lift any stay of discovery, and discovery is going forward," Koh told lawyers representing Apple and customers who filed the complaint.
Apple, through applications on iPhones, collected data on customers' geographical locations even after users said they didn't want to share the information, Scott Kamber, a lawyer representing customers, said in court today.
The Feds Unnecessarily Round Up Wild Horses,
Then Complain About Costs After ridding Western lands of thousands of wild mustangs at the request of corporate interests, the Bureau of Land Management now is worried about the price of its programs.
By Andrew Cohen - TheAtlantic.com
It surely cannot be easy these days being Joan Guilfoyle, the (relatively) new director of the Bureau of Land Management's Wild Horse and Burro Program. On the one hand she works for a federal agency, the Interior Department, which is largely beholden to the powerful industries it is supposed to regulate. And on the other hand, she is responsible, under federal law and policy, for ensuring the survival and management of the nation's wild horses at a time when relentless political and economic forces threaten to decimate the herds.
Federal Horse Rustlers & the Agenda 21 Hustle
By Debbie Coffey - PPJG.me
To begin with, the National Association of Conservation Districts (the "mother" of all Conservation Districts) is partnering in a way that promotes IUCN and ICLEI USA, thus pushing Agenda 21, the UN's action plan that will do away with your private property rights and Constitutional rights.
The Bureau of Land Management's Wild Horse & Burro Advisory Board meeting (April 2012), was the first meeting including Sec. of Interior Ken Salazar's new appointee, Callie Hendrickson. Hendrickson has served as an Executive Board member of the National Association of Conservation Districts, and works for the White River and Douglas Creek Conservation District in Colorado.
New Nanotechnology That Turns Windows
Into Transparent Solar Panels
By Energy Digital - OilPrice.com
Our modern world is consuming energy at insatiable rates. The high-tech complexity of contemporary society has created a demand for energy resources that are both easily accessible and infinitely available, and unfortunately the energy sources of yesterday simply do not hold up to the rapid evolution of the times.
Perhaps the major flaw in our previous approach to discovering a renewable energy source was not the narrowness, but the broadness of our scientific focus. Yesterday's Energy Market looked towards monumentally visible energy sources like Oil, blindly clinging to the notion that material visibility equated to energetic abundance.
iRobot's military bots get smarter and more agile (photos)
by ZDNet Author
The latest addition to iRobot's military robot line is the 110 FirstLook, a throwable robot designed to take pictures of locations for a remote operator. It's equipped with four cameras (seen on the side behind the flipper) and uses Wi-Fi to communicate back to a controller. It can also climb stairs using its flippers, although that's not its primary use. iRobot recently shipped the first 100 units to the U.S. military.
The Laser Future of U.S. Missile Defense
[Google title for free article pass] Russia and China recognize the low-cost efficiency of lasers.
Does the Pentagon?
By MARK GUNZINGER AND ANDREW KREPINEVICH - WSJ.com - $$
For 20 years, from the first Gulf War to the recent bombardment of Libya, the U.S. military has had few difficulties deploying and supplying its forces. Rivals and would-be enemies—from China to Hezbollah—have taken note, and they're moving to acquire long-range, precision-guided weapons that would threaten our forces by creating mass "kill zones" around airfields, ports and supply depots. This threat is far more formidable than the roadside bombs encountered by our forces in Afghanistan and Iraq.
The Pentagon is aware of this threat, but its approach to addressing it is old-fashioned and expensive. Despite looming budget cuts, it continues emphasizing multimillion-dollar interceptors to shoot down missiles and rockets that enemies can field at a small fraction of that cost. This places our military at the wrong end of a cost competition that our enemies will be only too happy to continue.
* * * * *
RUSSIA THREATENS PRE-EMPTIVE ATTACK
ON U.S. INSTALLATIONS The Chief of the Russian General Staff, Russia's top military officer, has threatened to attackAmerican (technically, NATO) anti-missile installations in Eastern Europe:
By John Hinderaker - PowerlineBlog.com
"A decision to use destructive force preemptively will be taken if the situation worsens," Russian Chief of General Staff Nikolai Makarov said at an international missile defense conference in Moscow attended by senior U.S. and NATO officials.
So the threat was made to our faces.
The threat comes as talks about the missile defense system, which the U.S. and its allies insist is aimed at Iranian missiles, appear to have stalled.
"We have not been able to find mutually-acceptable solutions
Russia threatens to strike NATO missile defense sites
By Shaun Waterman-The Washington Times
Russia's top military officer warned Thursday that Moscow would strike NATO missile-defense sites in Eastern Europe before they are ready for action, if the U.S. pushes ahead with deployment.
"A decision to use destructive force pre-emptively will be taken if the situation worsens," Russian Chief of General Staff Nikolai Makarov said at an international missile-defense conference in Moscow attended by senior U.S. and NATO officials.
Leaked U.S. Army Document Outlines Plan
For Re-Education Camps In America
by Paul Watson - InfoWars.com
A leaked U.S. Army document prepared for the Department of Defense contains shocking plans for "political activists" to be pacified by "PSYOP officers" into developing an "appreciation of U.S. policies" while detained in prison camps inside the United States.
The document, entitled FM 3-39.40 Internment and Resettlement Operations (PDF) was originally released on a restricted basis to the DoD in February 2010, but has now been leaked online.
Smile, you are a Civilian Internee!
By Madison Ruppert, Editor of End the Lie
As every day passes, it becomes clearer that our once-free nation is quickly turning down the path of a totalitarian police state, as embodied by the passage of S.1867 in the Senate and H.R.1540 in the House.
With the knowledge that KBR is developing a so-called "National Quick Response Team" to man the detention centers popularly referred to as "FEMA Camps" on 72 hours' notice, the picture only gets more grim.
This trend is also reflected in the recent United States Army job posting for Internment/Resettlement Specialists.
Red Dawn Re-Education Camps in America
Run by "PSYOP Officers" 1/3
A leaked U.S. Army document prepared for the Department of Defense contains shocking plans for "political activists" to be pacified by "PSYOP officers" into developing an "appreciation of U.S. policies" while detained in prison camps inside the United States.
The Great Fall of China
By Peter Coy, Dexter Roberts,
and Bruce Einhorn - BusinessWeek.com
Qi hu nan xia, goes a Chinese proverb: When one rides a tiger, it is difficult to dismount. For the leaders of China's 1.3 billion people, the import is clear. Stay on the tiger's back, issue commands, and hope like hell the beast doesn't turn on you. Over the last quarter-century that approach has served the mandarins of the Communist Party well. China became an economic marvel and staked a claim as the world's next superpower. Civil liberties, social development, environmental husbandry, and political transparency were subordinate to the imperatives of growth. Increasing complaints about the avarice and gangsterism of government officials could be dismissed as local problems as long as an enlightened elite was thought to be guiding the state with a steady hand. Even when under pressure to reform, China's leaders could reassure themselves that their grip on power remained secure.
Drones and the Dream of Remote Control in the Borderlands
by JOSEPH NEVINS - CounterPunch.org
Drones along the U.S. boundaries with Mexico and Canada are coming under criticism from an unexpected source: the Department of Homeland Security (DHS)—or, more specifically, the department's Office of the Inspector General (OIG). The critique helps open the door to those who oppose not only the increasing "eyes in the sky" in the borderlands, but also the larger apparatus of state surveillance and repression.
The OIG, charged with promoting "effectiveness, efficiency, and economy in the Department of Homeland Security's programs and operations," has undertaken an audit of the "unmanned aerial vehicle" program of U .S. Customs and Border Protection (CBP). According to a recent article in the Los Angeles Times, which obtained a draft audit of the OIG report, "[t]he nine Predators that help police America's borders have yet to prove very useful in stopping contraband or illegal immigrants."
The Anarchy Factor in Syria
By Itamar Rabinovich - Project-Syndicate.org
TEL AVIV – The failure of the Obama administration, its Western allies, and several Middle East regional powers to take bolder action to stop the carnage in Syria is often explained by their fear of anarchy. Given the Syrian opposition's manifest ineffectiveness and disunity, so the argument goes, President Bashar al-Assad's fall, when it finally comes, will incite civil war, massacres, and chaos, which is likely to spill over Syria's borders, further destabilizing weak neighbors like Iraq and Lebanon, and leading, perhaps, to a regional crisis.
What is actually happening in Syria refutes this argument. In fact, the lingering crisis is corroding the fabric of Syrian society and government. Anarchy is setting in now: it is preceding – and precipitating – the regime's eventual fall.
Israel Plots an Endgame
by RAMZY BAROUD - CounterPunch.org
Israel's colonization policies are entering an alarming new phase, comparable in historic magnitude to the original plans to colonize Gaza, the West Bank and East Jerusalem following the war of 1967.
On April 24, an Israeli ministerial committee approved three settlement outposts – Bruchin and Rechelim in the northern part of the West Bank, and Sansana in the south. Although all settlement activities in the occupied West Bank and East Jerusalem are considered illegal by international law, Israeli law differentiates between sanctioned settlements and 'illegal' ones. This distinction has actually proved to be no more than a disingenuous attempt at conflating international law, which is applicable to occupied lands, and Israeli law, which is in no way relevant.
New Obama Executive Order Pushes Us Closer
To A North American Union
And A One World Economic System
By Michael Snyder - EndOfTheAmericanDream.com
When it comes to Barack Obama, one of the most important things to understand is that he is a committed globalist. He firmly believes that more "global governance" (the elite don't like to use the term "global government") will make the world a much better place. Throughout his time in the White House, Obama has consistently sought to strengthen international institutions such as the UN, the IMF, the World Bank and the WTO. At every turn, Obama has endeavored to more fully integrate America into the "global community". Since he was elected, Obama has signed a whole host of new international economic agreements. He regularly speaks of the need for "cooperation" among global religions and he has hosted a wide variety of different religious celebrations at the White House. Obama once stated that "all nations must come together to build a stronger global regime". If you do not want to live in a "global regime" that is just too bad. To globalists such as Obama, it is inevitable that the United States of America will be merged into the emerging global system. Just this week, Obama has issued a new executive order that seeks to "harmonize" U.S. economic regulations with the rest of the world. This new executive order is yet another incremental step that is pushing us closer to a North American Union and a one world economic system. Unfortunately, most Americans have absolutely no idea what is happening.
Obama Order Urges Rule Review
to Boost U.S. Company Trade
By Andrew Zajac - BusinessWeek.com
President Barack Obama issued an executive order requiring a White House policy group to seek ways to closer align U.S. regulations with rules in other countries.
The order issued today instructs the panel to focus on increasing international regulatory cooperation, particularly in areas of emerging technology.
Differences in regulatory approaches between U.S. agencies and those of counterparts in an increasingly global economy "might not be necessary and might impair the ability of American businesses to export and compete internationally," the order states.
From Communism Day to Government Loyalty Day
By Kurt Nimmo - Infowars.com
On May 1, Obama issued a presidential proclamation. He officially changed May 1 – otherwise known as Communism Day after it was hijacked by the Soviet Union for propaganda purposes – to Loyalty Day, or rather loyalty and sacrifice to government day. It is odd that Obama would reaffirm our allegiance to the Constitution when he has violated it continually.
From the White House website:
In order to recognize the American spirit of loyalty and the sacrifices that so many have made for our Nation, the Congress, by Public Law 85-529 as amended, has designated May 1 of each year as "Loyalty Day." On this day, let us reaffirm our allegiance to the United States of America, our Constitution, and our founding values.
NOW, THEREFORE, I, BARACK OBAMA, President of the United States of America, do hereby proclaim May 1, 2012, as Loyalty Day. This Loyalty Day, I call upon all the people of the United States to join in support of this national observance, whether by displaying the flag of the United States or pledging allegiance to the Republic for which it stands.
IN WITNESS WHEREOF, I have hereunto set my hand this first day of May, in the year of our Lord two thousand twelve, and of the Independence of the United States of America the two hundred and thirty-sixth...
Is Gold Today's Safest Investment?
By Jordan Weissmann - TheAtlantic.com
It appears Ron Paul fans aren't the only gold bugs roaming around out there.
For the second straight year, an annual Gallup poll has found that a plurality of Americans believe gold is the single safest long term investment option. Safer than savings accounts. Safer than real estate. Safer than stocks. A full 28 percent of adults ranked gold as their top choice, down from 34 percent last year, a drop just outside the five point margin of error. It was most popular among older Americans, those without a college a degree, and individuals who earned between $30,000 and $75,000 a year.
Central Bank Demand to Change Gold, Silver Markets and Prices
By: Julian D. W. Phillips - GoldSeek.com
We are currently watching the final moves of a long-term consolidation period, in the near-term and ahead of a strong move either way. A look at the bulk of market commentators shows they are pretty well split on which way the gold and silver prices are headed, up or down? It depends whether the short-term traders take control of the precious metal prices, or whether the forces we are about to describe will take over. It could be a combination of both, with short-term forces breaking resistance, or support, initially, until new pressures take over and force traders and speculators to go with them. We shall see!
Patterns in gold price puzzling - but understandable The yellow metal seems increasingly resilient in the face of poor current fundamentals and strange downward price spikes from which it has recovered rapidly?
Author: Lawrence Williams - Mineweb.com
LONDON (MINEWEB) - Are we seeing some interesting resilience in the gold price? Despite reported continuing subdued demand from the Indian subcontinent - one of the major drivers in physical gold consumption - and yet another strange trade on COMEX on Monday which knocked the yellow metal back $14-$15 in a single minute, gold rapidly regained its poise that day and after a flat start yesterday did, at one time, breach the $1670 level, although not for long.
Gold Standard for All, From Nuts to Paul Krugman
By Amity Shlaes - Bloomberg.com
Nut cases. That's what they are. And if you take an interest in them, you are a nut case, too.
That's the consensus among credentialed economists who describe advocates of a return to the monetary regime known as the gold standard. In fact, the economic pack will marginalize you as a weirdo faster than you can say "Jacques Rueff," if you even raise the topic of monetary policy in relation to gold.
Paul Krugman on How to Fix the Economy -
and Why It's Easier Than You Think
By Julian Brookes - RollingStone.com
Four years after the start of the Great Recession, nobody would mistake U.S. economy for a thrumming engine of growth, prosperity, and human flourishing. Sure, we're officially out of "recession." But the recovery is painfully slow and uneven, and 24 million Americans are still unemployed or underemployed. There's a lot of pain out there, and a lot of potential going to waste.
The worst part? It doesn't have to be this way. Or so says Paul Krugman. In a new book, End This Depression Now!, the Nobel-winning economist and New York Times columnist makes an urgent, even passionate case that our economic problems are, at root, fairly simple, and we have the knowledge and the tools to solve them. We've been here before, Krugman argues, during the Great Depression, and the actions that got us out of that crisis will get us out of this one, too.
The Invisible Red Line
BY JOHN BUTLER - FinancialSense.com
Professor Paul Krugman and Rep. Ron Paul (R-Texas) went head to head on BloombergTV this week. True to his neo-Keynesian form, Prof. Krugman insisted that the US government could and should add further debt to stimulate growth. Rep. Paul responded by asking how much debt would be too much, to which Krugman replied: "We're not anywhere close to a red line." Really? What makes him so certain? Certain red lines are like tipping-points. They can only be seen in retrospect. In my view, the US has already crossed the excessive debt 'red line' implying a dramatic future devaluation of the dollar. It is only a matter of time before Krugman and other members of the economic and policy mainstream look back on recent developments and reach this conclusion. Financial markets, however, will not wait.
The Fed Works for the Very Rich Why Paul Krugman is Full of S--t
by ROB URIE - CounterPunch.org
Late last week Princeton University economist and New York Times columnist Paul Krugman wrote a piece on his NY Times blog that history will view as the best evidence to appear in at least several decades of the utter irrelevance of mainstream economics. The piece purported to respond to a Wall Street Journal editorial by Mark Spitznagel in which Mr. Spitznagel argued broadly the Austrian economists' line that all government spending favors one group over another and more specifically that the Fed's Quantitative Easing (QE) programs of recent years favor banks and the rich.
Why New York Times Economist Paul Krugman
Is Partly Right But Mostly Wrong
By Michael Snyder - TheEconomicCollapseBlog.com
In recent days, New York Times economist Paul Krugman has been doing a whole bunch of interviews in which he has declared that the solution to our economic problems is very easy. Krugman says that all we need to do to get the global economy going again is for the governments of the world to start spending a lot more money. Krugman believes that austerity is only going to cause the economies of the industrialized world to slow down even further and therefore he says that it is the wrong approach. And you know what? Krugman is partly right about all of this. The false prosperity that the United States and Europe have been enjoying has been fueled by unprecedented amounts of debt, and in order to maintain that level of false prosperity we are going to need even larger amounts of debt. But there are several reasons why Krugman is mostly wrong.
Krugman's Left-Wing Bullying of Bernanke
By LIZ PEEK, The Fiscal Times
Paul Krugman vaulted over the line recently, issuing an ad hominem attack on Fed Chair Ben Bernanke for not doing enough to boost the economy. Krugman's anxiety that the stuttering recovery will bounce President Obama from the White House seems to have loosened his already-fragile grip on reality. His conclusion – that "right-wing bullying" is holding Bernanke back – seems especially nonsensical, even for the truculent Mr. Krugman.
Dallas Fed President Richard Fisher's response? "No one bullies Ben Bernanke." Fisher was not the only speaker at the Milken Institute Global Conference taking place in Los Angeles who would challenge Mr. Krugman's highly partisan worldview.
U.S. considers issuing floating-rate debt
By Zachary A. Goldfarb - WashingtonPost.com
The Treasury Department is expected to announce Wednesday whether it will begin issuing a new type of federal debt for the first time in 15 years — a reflection of the global interest in storing cash in the United States and of the government's desire to avoid unexpected disruptions in its ability to borrow.
The Treasury is considering following the advice of Wall street traders by introducing a type of investment known as a floating-rate note. The note would allow the government to borrow money for a fixed period — say, two years — while paying a variable interest rate.
Total US Debt Soars To 101.5% Of GDP
Submitted by Tyler Durden - ZeroHedge.com
There is nothing quite like a $70 billion debt auction settlement at the last day of a month to bring total US debt to a record $15.692 trillion, which happens to be just $600 billion shy of the $16.394 trillion debt ceiling. (and no, contrary to simple economic textbook lesson, this does not mean that the private sector just got another $70 billion in debt capacity courtesy of taxpayers, as explained here). And now that we know what Q1 GDP was at the end of Q1, or namely $15.462 trillion, it is simply math to divine that today alone total US/debt to GDP rose by 50 bps to a mindboggling 101.5%.
Charles Biderman: EU Debt Crisis Going to Get Worse
By Greg Hunter's USAWatchdog.com
The most underreported story this week is the European debt crisis. Greece, Portugal and Ireland have all been in the spotlight with money troubles. Now, Spain is taking center stage, and its debt is more than double the previous three countries.
There has been one bailout after another. Nothing is working as many EU countries plunge into recession. Charles Biderman, CEO of Trim Tabs Investment Research, says the situation is bad and it's going to get a lot "worse." Mr. Biderman says the Europeans won't be the only ones that will feel financial pain. He thinks it's only a matter of time before the EU "implodes," and that crater will be big enough to pull down some very large U.S. banks.
Spain's unemployment prompts a look elsewhere
By Howard Schneider - WashingtonPost.com
MADRID — Six months after being laid off from a surveying job, Manuel Martin has had it with Spain.
The construction industry here is moribund, he said, and he has no expectation that it will rebound anytime soon. Pausing during a bicycle ride in the suburbs of Madrid, Martin and a friend noted the for-sale signs displayed at some of the apartment buildings and point to building projects that were abandoned mid-stream.
Europe's next recession risk: Germany
By Ben Rooney @CNNMoneyInvest
NEW YORK (CNNMoney) -- As recession spreads across Europe, Germany may not be able to avoid being dragged down.
In the past week, Spain and the United Kingdom revealed that they had slipped back into recession, with two straight quarters of economic contraction.
In all, 12 European economies are now officially in recession.
Germany, the largest euro economy and the fourth largest worldwide, could be next: Its economy shrank 0.2% in the last three months of 2011, and it is expected to show another contraction when it releases data for the first quarter in mid-May.
We Are Not Powerless: Resisting Financial Feudalism
BY CHARLES HUGH SMITH - FinancialSense.com
That we are powerless is one of the key social control myths constantly promoted by the Status Quo. What better way to keep the serfs passive than to reinforce a belief in their powerlessness against the expansive Central State and its financial feudalism?
But we are not powerless. Our complicity gives the aristocracy its power. Remove our complicity and the aristocracy falls.
The pathway of dissent is to resist financial feudalism and its enforcer, the expansive Central State. Here are twelve paths of resistance any adult can legally pursue in the course of their daily lives:
Dimon Cites 'Give and Take' After Bank Chiefs Meet Fed Officials
Heather Hauswirth and Bradley KeounMay - WashingtonPost.com
May 2 (Bloomberg) -- JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon said there was "give and take" when bank leaders met with Federal Reserve officials to discuss industry oversight in New York today.
Dimon, who said "everything" was a potential topic as he and other CEOs entered the New York Fed's offices, declined to elaborate on the talks as he left. Top executives were scheduled to meet with Fed Governor Daniel Tarullo today, four people familiar with the meeting said earlier this week.
American CEOs enjoy 15% pay rise
in second year of double-digit hikes Boom time for America's top bosses in 2011 contrasts with wider economy, where average wages have been little better than flat
By Dominic Rushe in New York - Guardian.co.uk
America's top bosses have handed themselves double-digit pay rises for the second year in a row, according to interim figures from the most comprehensive survey of CEO pay.
The Guardian's exclusive first look at the research by GMI Ratings reveals that rising share prices helped drive a 15% pay hike for the average US CEO in 2011, with the average compensation package hitting $5.8m.
United States' new business formation rate
continues dropping steadily
By J.D. Harrison - WashingtonPost.com
Spend some time walking through Silicon Valley or New York City, and you'll likely leave under the impression that entrepreneurship is alive and well in the United States. But spend some time wading through some of the latest census data, and you may come away with a very different impression.
The country's rate of new business development continues to slide, according to a Census Bureau Business Dynamics Statistics briefing published by the Kauffman Foundation on Wednesday. The report shows the rate of new business formation has fallen to between 7 percent and 8 percent (as a portion of all companies), down significantly from the rate of 12 percent to 13 percent in the 1980s.
Is Wells Fargo a Lehman in the Making?
By Yves Smith - NakedCapitalism.com
Banking maven Chris Whalen has a must-read piece on the reckless real estate risk taking underway at Wells Fargo, the sanctimonious #4 bank. While I sometimes take issue with Chris on his readings on capital markets related businesses, he is solid on his knowledge of traditional banking and also has access to very good intelligence in that arena.
Thanks to the crisis just past, we tend to think of banks as creating danger to bystanders via their over-the-counter trading operations: securitizations, CDOs, derivatives, all that stuff that is now loosely termed as "shadow banking." But the US crisis prior to that was the S&L and the less widely recognized LBO debt meltdown of the early 1990s, both traditional bank lending. Even though economists airily wave it away as damaging but not catastrophic, it didn't look that way at the time. Citibank nearly failed and the entire banking sector was really wobbly. Greenspan engineered an extremely steep yield curve to help banks earn their way out of the hole faster.
Treasury: Tax receipts not changing deadline
on $16.4T debt limit
By Peter Schroeder - TheHill.com
Lawmakers will not have to re-fight their epic battle over raising the debt ceiling until after the November elections, according to the Treasury Department.
April tax receipts have not moved Treasury's debt-ceiling target date, and Secretary Timothy Geithner still expects lawmakers will have until the tail end of 2012 to raise the $16.394 trillion ceiling.
Treasury Dept. Fails to Implement
Two-Thirds of Post-Bailout Recommendations
by Noel Brinkerhoff, David Wallechinsky - AllGov.com
When the George W. Bush administration bailed out Wall Street four years ago, it created the Troubled Asset Relief Program (TARP) and a special inspector general (SIGTARP) to advise theDepartment of the Treasury on the rescue. It turns out, though, that Treasury officials have largely ignored what SIGTARP had to say on preventing waste, abuse and fraud involving taxpayer dollars.
According to the special inspector general's latest report to Congress, the Treasury Department has failed to fully implement two-thirds of SIGTARP's 96 recommendations.
In many instances, the new special inspector general, Christy Romero, and others in her office haven't been able to get an answer on why the recommendations weren't heeded.
Why Reagan's Tax Reform Roadmap Won't Work Now
By ERIC PIANIN and MICHELLE HIRSCH, The Fiscal Times
As politicians and business leaders sound the battle cry to make over the loophole-ridden U.S. tax code, they often point wistfully to the Reagan as the perfect road map. The Tax Reform Act of 1986 achieved many of the goals now being espoused by Republicans and Democrats: It greatly simplified the income tax code, broadened the tax base and eliminated many tax shelters and preferences.
The measure was made "revenue neutral" by decreasing individual tax rates and eliminating $30 billion a year in loopholes while increasing corporate taxes. Many of the brackets were consolidated, and the top tax rate was lowered from 50 percent to 28 percent.
Fannie Mae had seen benefits
to lowering some home loans, documents indicate
By Brady Dennis - WashingtonPost.com
Officials at government-backed mortgage giant Fannie Mae concluded years ago that the company could "reduce its losses substantially" by lowering loan amounts for some troubled borrowers, according to internal documents cited Tuesday by the top Democrat on the House oversight committee.
The new insights into Fannie Mae's analyses about the potential benefits of so-called principal reduction surfaced in a letter from Rep. Elijah E. Cummings (D-Md.) to Edward J. DeMarco, the acting director of the independent agency that oversees Fannie Mae and Freddie Mac.
Why U.S. House Prices Won't Recover Taking inflation into account,
U.S. home prices are down to 1895 levels.
By Jack Hough - SmartMoney.com
When will U.S. house prices recover? Likely never. But that's no reason not to buy.
The latest S&P / Case-Shiller numbers, reported last week, show that prices in 20 major markets declined 3.5% over the year through February. They're now back to 2002 levels. If we subtract for inflation, they're back to 1998 levels.
But consider: After subtracting for inflation, prices are also back to 1986 levels. And 1955 levels. And 1895 levels (see chart).
Payroll Survey Signals U.S. Jobs Slowing as Orders Drop
By Shobhana Chandra and Timothy R. Homan - Bloomberg.com
Companies in the U.S. added fewer workers last month, according to data from a private survey, pointing to a cooling in the job market, as the Commerce Department also reported a decline in factory orders in March.
Private employment increased by 119,000, the smallest gain in seven months, after rising by 201,000 in March, Roseland, New Jersey-based ADP Employer Services said. Orders to factories fell 1.5 percent following a 1.1 percent gain in February.
ADP estimates businesses added only 119,000 jobs in April
By Paul Davidson, USA TODAY
Private payrolls grew by just 119,000 in April, according to a survey by payroll giant ADP, feeding fears that a larger, more closely watched government report on Friday will show disappointing job growth for a second month.
The gains in the ADP survey of private businesses were the fewest in seven months, as large businesses and manufacturers, in particular, posted weak employment growth.
95 Percent Of The Jobs Lost During The Recession
Were Middle Class Jobs
By Michael Snyder - TheEconomicCollapseBlog.com
Who is the biggest loser in the ongoing decline of the U.S. economy? Is it the wealthy? No, the stock market has been soaring lately and their incomes are actually going up. Is it the poor? Well, the poor are definitely hurting very badly, but when you don't have much to begin with you don't have much to lose. Unfortunately, it is the middle class that has lost the most during this economic downturn. According to Bloomberg, 95 percent of the jobs lost during the recession were middle class jobs. That is an absolutely astounding figure. Yes, some executives lost their jobs during the last recession as did some minimum-wage workers. But overwhelmingly the jobs that were lost were middle income jobs. Sadly, the limited number of jobs that have been added since the end of the last recession have mostly been low income jobs. A higher percentage of Americans are working low income jobs than ever before, and the cost of living continues to rise at a very brisk pace. This is causing an erosion of the middle class unlike anything we have ever seen in American history.
The Beginning of the End of the Unpaid Internship
By JOSH SANBURN - Time.com
In August 2011, when Diana Wang began her seventh unpaid internship, this time at Harper's Bazaar, the legendary high-end fashion magazine, she figured that her previous six internships – at a modeling agency, a PR firm, a jewelry designer, a magazine, an art gallery and a state governor's office – had prepared her for the demands of New York's fashion world.
"I was so determined to make this one really worth my while," says the 28-year-old Wang, who moved from Columbus, Ohio, to New York, where she was living with her boyfriend (also working as an unpaid intern at one point) and living off of her savings. "I knew I couldn't do anymore internships after this."
Wal-Mart to pay $4.8 million in back wages
By Ylan Q. Mui - WashingtonPost.com
The Labor Department on Tuesday ordered Wal-Mart to pay $4.8 million in back wages and damages to thousands of employees who were denied overtime charges, the latest in a string of embarrassments for the company over its business practices.
The department said its decision affects roughly 4,500 vision-center managers and asset-protection coordinators who worked at Wal-Mart between 2004 and 2007. Wal-Mart had considered those employees exempt from federal regulations requiring overtime pay but reclassified them in 2007. The government and the retailer have been negotiating the amount owed since then.
Collapsing U.S. Postal Service Needs Freedom to Cut Costs
By the Editors - Bloomberg.com
Like a Pony Express rider wobbling toward Fort Laramie with an arrow in his hat, the Senate bill passed last week to reform the U.S. Postal Service is far from its goal and facing attack from all sides.
The ambush -- led by House Republicans, postal-worker unions and the service itself -- seems overly aggressive: The bill is Congress's first earnest attempt to stop the impending meltdown of the Postal Service, which loses $25 million a day and says it might have to close thousands of post offices and hundreds of distribution centers in the next few months. The legislation also gets several issues right. First, it would revise payment schedules to two federal-worker retirement funds, allowing the service to offer retirement incentives and trim the workforce by 100,000 jobs.
Occupy May Day protests across US
as activists and unions link up Occupy Wall Street movement regroups for largely orderly demonstrations in New York and skirmishes elsewhere
By Ryan Devereaux in New York - Guardian.co.uk
The Occupy Wall Street movement has attempted to breathe new life into its campaign against inequities in the global financial system with a series of May Day protests across around the US.
Thousands of people turned out in New York for a day of action that culminated in a confident march down Broadway in the evening sunshine towards Wall Street, the crucible of the protest that began last year with an angry backlash against banking excess.
More than 100 charged in massive Medicare fraud busts
in 7 cities in scams totaling $452 mil
AP - WashingtonPost.com
MIAMI — Federal authorities charged 107 doctors, nurses and social workers in seven cities with Medicare fraud Wednesday in a nationwide crackdown on unrelated scams that allegedly billed the taxpayer-funded program of $452 million — the highest dollar amount in a single Medicare bust in U.S. history.
It was the latest in a string of major arrests in the past two years as authorities have targeted fraud that's believed to cost the government between $60 billion and $90 billion each year. Stopping Medicare's budget from hemorrhaging that money will be key to paying for President Barack Obama's health care overhaul.
Lab Security Standards Raise Chances
of Mutant-Bird-Flu Catastrophe
By Brandon Keim - Wired.com
Fears that bioterrorists could learn from controversial experiments that make H5N1 avian influenza more virulent have overshadowed a more pressing danger: accidental releases, laboratory infections and disgruntled workers.
Dozens of all-too-human mistakes have occurred in just the last decade inside high-security laboratories, and many experts say new H5N1 flu strains engineered to infect mammals have not been handled with the care required to minimize chances of unintentional catastrophe.
In fact, research on less-threatening pathogens is conducted at higher security levels than research on the new bird flu and other strains made artificially more virulent.
Low level doses of radiation more harmful that high doses The Low-Level Radiation Puzzle
By MATTHEW L. WALD - NYTimes.com
The Bulletin of the Atomic Scientists is casting new light – or maybe just heat — on the murky field of sizing up the health effects of small radiation doses.
The publication's May-June issue carries seven articles and an editorial on the subject of low-dose radiation, a problem that has thus far defied scientific consensus but has assumed renewed importance since the meltdown of the Fukushima Daiichi reactors in Japan in March 2011. The accident contaminated the surrounding area, and questions persist about whether residents should be allowed to return or whether the radiation doses they would receive are too big a threat to their health.
Facebook and Organ Donation: Savvy or Stupid?
By MAUREEN MACKEY, The Fiscal Times
....While few would argue the tremendous good that organ transplantation can do, privacy experts and privacy attorneys see some gray and even dark areas when it comes to expressing a personal "status" about it.
"I'm not even comfortable with the timeline" on Facebook, Mari J. Frank, an attorney and privacy expert in Laguna Niguel, California, told The Fiscal Times. "I think Facebook wants you to reveal as much as you can about yourself, because that helps their third-party vendors who pay them. That information gets shared. It can be seen by others, and what you post lives forever. If you want your friends and family to know your feelings about organ donation, tell them separately – in your will, your trust, on your driver's license." And let's not forget the black market for organs in places such as China, Frank added.
NRA ends silence and
comes out fighting for stand-your-ground laws Initially silent amid controversy of Trayvon Martin's death, gun-lobby group vows to defend the controversial statutes
By Ed Pilkington in New York - Guardian.co.uk
The National Rifle Association has begun a rearguard action to shore up the controversial "stand-your-ground" laws that it has promoted across America, in the wake of the eruption of public anger over the killing inFlorida of the unarmed black teenager Trayvon Martin.
Since Martin was fatally shot by George Zimmerman, a self-declared neighborhood watch leader invoking the stand-your-ground law, on 26 February the NRA has kept uncharacteristically silent. Numerous requests by journalists for the association to answer charges that it had encouraged violent vigilantism were met with "no comment".
'Supermoon' coming this Saturday
By Fox Van Allen, Tecca - USAToday.com
This weekend will be an absolute delight for both professional and amateur astronomers alike: On Saturday, the United States will be treated to a "supermoon" event — an evening where the full moon appears at its largest and brightest in the night sky. It's the first of six major celestial events slated to occur in the month of May.
The moon will officially become full at 11:35 p.m. on Saturday, May 5. This coincides almost perfectly with the moon's perigee — that is, the moment when the moon is closest to Earth in its orbit. This supermoon will be especially pronounced given that this will be the moon's closest approach of the year.
After 50 years, Cubans hope to travel freely
By PAUL HAVEN - Guardian.co.uk
Associated Press= HAVANA (AP) — After controlling the comings and goings of its people for five decades, communist Cuba appears on the verge of a momentous decision to lift many travel restrictions. One senior official says a "radical and profound" change is weeks away.
The comment by Parliament Chief Ricardo Alarcon has residents, exiles and policymakers abuzz with speculation that the much-hated exit visa could be a thing of the past, even if Raul Castro's government continues to limit the travel of doctors, scientists, military personnel and others in sensitive roles to prevent a brain drain.
Occupy Activists' Bomb Plot Foiled
By Arnold Ahlert - PatriotPost.us
Why the five would-be Cleveland terrorists are far from "fringe" elements of OWS.
Yesterday in the midst of the OWS May Day protests taking place around the nation, the U.S. Justice Department revealed exactly how far some of those associated with such protests are willing to go. In Cleveland, Ohio, five men who describe themselves as anarchists were arrested for their attempt to blow up the Brecksville-Northfield High Level Bridge that crosses the Cuyahoga Valley National Park. U.S. Attorney for the Northern District of Ohio, Steven M. Dettelbach, characterized the defendants as men who "took numerous and repeated acts that demonstrated a commitment to violent, terrorist acts." And despite efforts to distance themselves from these wannabe terrorists, Occupy Cleveland media coordinator Jacob Wagner admitted that "at least some of the five men" attended that group's events.
Al Qaeda Magazine Calls for Firebomb Campaign in US
By RANDY KREIDER - ABCNews.com
The men who launched al Qaeda's English-language magazine may have died in a U.S. missile strike last fall, but "Inspire" magazine lives on without them -- and continues to promote jihadi attacks on Western targets, offering detailed advice on how to start huge forest fires in America with timed explosives and how to build remote-controlled bombs.
Two new issues of "Inspire" magazine have surfaced on jihadi forums, the first since radical cleric Anwar al-Awlaki and chief Al Qaeda in the Arabian Peninsula propagandist Samir Khan were killed by missiles from a U.S. drone over Yemen on September 30, 2011. The magazines eulogize Awlaki and Khan as the "spirit" and the "tongue" of "Inspire" respectively, but deny that their deaths will stop the magazine or jihad.
How Strong Is al Qaeda Today, Really?
A year after bin Laden's death, we still often talk about his group's successful or failure in somewhat exaggerated terms. The truth may in fact be somewhere in the middle.
By Joshua Foust - TheAtlantic.com
This week marks one year since Osama bin Laden's death. We're hearing a lot about what the anniversary means for the larger struggle against Islamist violence around the world. Most assessments of the "War on Terror" fall into one of two categories: al-Qaeda is stronger than ever or al-Qaeda is dead or dying. Whatever you think about al-Qaeda specifically, the global movement of violent Islamism is more complicated.
U.S.-China deal freeing dissident now in question Chen Guangcheng lawyer says
dissident feels 'pressure' and fears for his safety
Keith B. Richburg and Jia Lynn Yang
BEIJING — A lawyer for blind activist Chen Guangcheng on Wednesday questioned a U.S.-brokered deal to guarantee Chen's safety in China and said that, after leaving the protection of the U.S. Embassy here, the dissident may have no choice but to go to the United States.
Chen traveled from the diplomatic compound to a Beijing hospital with U.S. Ambassador Gary Locke on Wednesday afternoon, but soon found himself surrounded by Chinese plainclothes police, with no American diplomats present.
Geithner Sees Need for 1970s-Style Shift in China Economy
By Ian Katz - Bloomberg.com
U.S. Treasury Secretary Timothy F. Geithner said the country has a "strong interest" in China's ability to reshape its economy in favor of consumption and private growth and away from exports and state-owned enterprises.
"In China, you are in the process of exploring the next frontier of economic reforms, recognizing as your predecessors did more than 30 years ago, that future economic growth will require another fundamental shift in economic policy," Geithner said in remarks prepared for the opening of annual U.S.-China talks in Beijing today. "The United States has a strong interest in the success of these reforms, as does the rest of the world."
BP to start three new Gulf of Mexico oil rigs New drilling sites brings number of BP's Gulf rigs to eight – more than it operated before the Deepwater Horizon disaster
By Rupert Neate and agencies - Guardian.co.uk
BP is planning to start three new oil drilling rigs in the Gulf of Mexico this year. The launch of the new rigs will bring the number of BP rigs in the Gulf to eight – more than the oil giant had before the devastating Deepwater Horizon disaster three years ago.
Bernard Looney, BP's executive in charge of new wells, said BP is expecting to spend $4bn (£2.5bn) on new developments in the Gulf of Mexico this year and hopes to "invest at least that much every year over the next decade".
Taliban announces start of annual Afghan offensive
By Tom A. Peter, Special for USA TODAY
KABUL – The Taliban warned it will officially start its annual "spring offensive" in Afghanistan on Thursday.
The Taliban said this year's offensive would be code-named "Al-Farouk," the title of the second Muslim caliph who lived in the seventh century.
The Taliban said the offensive would focus on "all those people who work against the Mujahedeen, toil to pave ground for the occupation of Afghanistan and become the cause for the strength of the invaders."
Will Sadat's Camp David and the Zionist Embassy be Next?
by FRANKLIN LAMB, Beirut - CounterPunch.org
The Egyptian people are demanding the return of their sovereignty. According to recent opinion surveys they believe it was partially ceded to Israel by the two post-Nasser dictators, Anwar Sadat and Hosni Mubarak, at the behest of American administrations, from Nixon to Obama.
The removal of three humiliating shackles for Egyptians, the gas give-away scheme, the 1979 Camp David Accords and the US forced recognition of Israel, constitute a strategic national security objective for most of Egypt's 82 million citizens. According to the results of an opinion poll, conducted for Press TV and published on October 3, 2011, 73 percent of the Egyptian respondents opposed the terms of the agreement. Today the figure is estimated at 90%.
Israel Prepares for War
By Kurt Nimmo - Infowars.com
Israel's IDF has called up six reserve battalions as the situation on the Syrian and Egyptian borders deteriorates. The Knesset, the Israeli parliament, has given permission to call up an additional 16 reserve battalions if necessary, the Times of Israel reported on May 2.
"This signifies that the IDF regards the Egyptian and Syrian borders as the potential source of a greater threat than in the past," said former deputy chief of staff, Dan Harel.
"The army needs a better 'answer' than in the past to the threat," he added, mentioning Egypt's loss of control over the Sinai.
Time to Accumulate Gold and Silver
By Jeff Clark - DailyReckoning.com
05/01/12 Do you own enough gold and silver for what lies ahead?
If 10% of your total investable assets (i.e., excluding equity in your primary residence) aren't held in various forms of gold and silver, we at Casey Research think your portfolio is at risk.
After speaking at the Cambridge House conference last month and talking with many attendees, I came away convinced that most investors fall into one of two categories: those who hold an abundance of gold and silver (which tends to be physical forms only), and those with little or none. While both groups need to diversify, I'm a little more concerned about the second group. Here's why.
Gold Seen Advancing on Central Banks Stimulus Speculation
By Debarati Roy and Nicholas Larkin - Bloomberg.com
Gold may decline for the second straight day as signs of stronger industrial growth in the U.S. boosted prospects for the economy and eroded the appeal of the precious metal as a haven.
The Standard & Poor's 500 Index rose as much as 0.9 percent, after declining 0.4 percent yesterday, as the Institute for Supply Management's factory index rose to 54.8 in April from 53.4 in March, the Tempe, Arizona-based group's report showed. Economists had forecast a reading of 53, according to the median estimate in a Bloomberg survey. Before today, the precious metal gained 6.2 percent this year.
Preparing for a Lengthy and Unpredictable US Dollar Crisis
By Eric Fry - DailyReckoning.com
05/01/12 Laguna Beach, California – "On the threshold of a crisis," we observed in our essay "Investing Ahead of the Curve" in the July 19, 2011 edition of The Daily Reckoning, "a fertile imagination can be an investor's most valuable asset."
"During normal times," we continued, "investors can focus only on buying quality stocks one by one from the bottom up, without also trying to envision what tragedies might befall them from the top down… But it may be time to begin imagining the unimaginable.
"It may be time, in other words, to begin considering that the next phase of the global monetary system might not include the US dollar as its reserve currency…or that the next two decades of life in America might not look anything like the last two decades."
Spain Default Could Hit US Market 10%-20%: Economist
By: Margo D. Beller - CNBC.com
Spain's newly announced recession won't be ending any time soon and it could force the U.S. stock market to fall anywhere between 10 percent and 20 percent, economist Harry Dent told CNBC Monday.
"Spain is going to default. The markets are in total denial on this," Dent, author of "The Great Crash Ahead," told CNBC's "Squawk on the Street." "It's a question of whether it's going to happen sooner or later."
Dent spoke after Standard & Poor'sdowngraded 16 Spanish banks and the nation announced first-quarter gross domestic product figures that showed the country to be in recession.
Spain's problems are far worse than what happened in Greece, he added.
Electoral silence on France's slow economic decline France's economy has weathered the global crisis of the last five years deceptively well, shielded by a Leviathan state and the postponement of hard choices.
By Ambrose Evans-Pritchard - Telegraph.co.uk
Yet the underlying decline that began 30 years ago has gathered speed. France's share of eurozone exports has dropped from 17pc to 13pc since 2000. Spain, Benelux and Germany have done much better.
"France is coddled with illusions," said Jean Peyrelevade, ex-head of Credit Lyonnais. "Economic decline is the brutal, hard, undeniable reality. We are consuming the leftovers of a past prosperity."
Art Cashin Issues His Latest Warning On Egypt
Submitted by Tyler Durden- ZeorHedge.com
Last week, when we discussed the recent ominous gas deal cancellation between Egypt and Israel we warned that the May Egyptian presidential election is the one that nobody is concerned about, yet should be far more prominent on everyone's radar, especially in the aftermath of not only the recent deterioration of Egypt-Israel relations, but also the withdrawal of the Arabian ambassador from Cairo. Art Cashin is one person who has been following this underreported hotbed of geopolitical tensions and has just issued his third warning of what he calls another "nose to nose" in the middle east. Issue is this particular nose has all the leverage courtesy of a little canal that has a huge impact on the most important asset price in the world.
From UBS Financial Services
Egypt Bears Watching Closely - Bob Hardy's excellent GeoStrat site had a couple of keen insights on Egypt. (We hear the site is getting popular among the hedgies.) Bob did a thorough analysis of the rather confusing electoral setup. Here's a small segment:
Saudi Arabia and the Egyptian 'no'
By ABDUL RAHMAN AL-RASHED - AlArabiya News
The word "no" is the most prevalent in the Egyptian scene right now. Scores of noes are reiterated daily on the local level: no to military trials, no to remnants of the former regime, no to the military council, no to presidential elections before drafting the constitution, no to the constituent assembly, no to the elections commission, and no to postponing presidential elections.
The international level has also had its share of those noes: no to borrowing from the World Bank, no to American aid, no to exporting natural gas to Israel, no to closing down NGOs and so on. The latest no is to Saudi Arabia and follows the arrest of an Egyptian man called Ahmed al-Gazawi at Jeddah Airport for possession of banned drugs.
Saudi Arabia closes Cairo embassy,
recalls ambassador due to protests over detained Egyptian
AP - WashingtonPost.com
RIYADH, Saudi Arabia — Saudi Arabia closed its Cairo embassy Saturday and recalled its ambassador following protests over a detained Egyptian human rights lawyer in a sharp escalation of tension between two regional powerhouses already on shaky terms due to uprisings in the Arab world.
The unexpected Saudi diplomatic break came following days of protests by hundreds of Egyptians outside the Saudi Embassy in Cairo and consulates in other cities to demand the release of Ahmed el-Gezawi. Relatives and human rights groups say he was detained for allegedly insulting the kingdom's monarch.
New York Fed: Leave the Building!
Mises Daily: by Robert Wenzel
[At the invitation of the New York Federal Reserve Bank, Robert Wenzel spoke and had lunch in the bank's Liberty Room on April 25, 2012. Below are his prepared remarks.]
Thank you very much for inviting me to speak here at the New York Federal Reserve Bank.
Intellectual discourse is, of course, extraordinarily valuable in reaching truth. In this sense, I welcome the opportunity to discuss my views on the economy and monetary policy and how they may differ with those of you here at the Fed.
That said, I suspect my views are so different from those of you here today that my comments will be a complete failure in convincing you to do what I believe should be done, which is to close down the entire Federal Reserve System.
Dallas Fed: Why We Must End TBTF Now!
Submitted by Tyler Durden - ZeroHedge.com
"We're on the road to economic stagnation" is how the Dallas fed describes the status quo as Too-Big-To-Fail (TBTF) is forcing the US economy to suffer from the perpetuation of perverse incentives. We want to get back on the path to prosperity and they note that there are some things monetary policy can't fix (well we know that already) but in this case they demand an end to the TBTF paradigm now. In an excellent presentation of the costs and benefits of ending TBTF (defined rather tongue-in-cheekily: The unwillingness of a government entity to abruptly close an insolvent company and force its creditors to sustain sizable losses due to the company's size, complexity, interconnectedness and general significance within the financial system), the ignorance of the process of creative destruction is critical as they note that a sick (or failed) bank cannot lend: "Undercapitalized banks gum up the working of the interdependent moving parts of the monetary policy engine". Dismissing the Dodd-Frank Act as a distraction that doesn't buttress market discipline, they summarize their guiding principles as: End banking oligopoly power; punish failure quickly; and change the do-or-die (M.A.D.) decision-making paradigm; ending with the threat promise suggestion that Restructuring isn't so radical, firms do it all the time.
Tuesday Never Comes
Bill Gross - Pimco.com
The global economy is floating on an ocean of credit, and a good thing too as our cartoon friend Wimpy reminds us. Without it, he would be a hungry puppy by next Tuesday and nearly seven billion world citizens would be worse off if barter, and not credit, was the oil that lubricated trade. Unlike Wimpy, early societies functioned without an exchange (money) or the promise to pay it back in the future (credit). Growth was limited, however, because savings or investment could not be incented properly. Those that wanted to save for a rainy day had no means to express that caution; better to consume a banana or a hamburger today than to watch it rot and become worthless on Tuesday. But money changed all of that and the ability to borrow and exchange it for repayment at some future date was the economic elixir of the ages. Shakespeare, with his admonition to "neither a borrower nor a lender be," might have won a 17th century Pulitzer, but definitely not a Nobel Prize for economics.
Pimco's El-Erian: The Fed needs some help
El-Erian: Spain could make or break Europe
By Catherine Tymkiw @CNNMoneyInvest
LOS ANGELES (CNNMoney) -- The U.S. economy is on the right path but it's not moving fast enough, said Pimco Chief Executive Mohamed El-Erian.
El-Erian told CNNMoney at the Milken Institute Global Conference in Los Angeles that those who expect a speedy recovery will be disappointed.
"People differ on what the economy will do, and in assessing what should happen versus what's likely to happen," he said, adding, "the economy will unfortunately weaken because it faces significant headwinds from outside."
Take the most recent gross domestic product figures.
Manufacturing in U.S. Unexpectedly Expands at a Faster Pace
By Alex Kowalski - Bloomberg.com
Manufacturing unexpectedly expanded in April at the fastest pace in 10 months, driven by gains in orders and production that signal the U.S. remains a source of strength for the global economy.
The Institute for Supply Management's factory index climbed to 54.8 last month, exceeding the most optimistic forecast in a Bloomberg News survey, from 53.4 in March, the Tempe, Arizona- based group's report showed today. Readings greater than 50 signal growth. The median forecast in the Bloomberg survey called for a drop to 53. Measures of production and orders were the highest in a year.
GE brings manufacturing jobs back to U.S.
GE shipped much of its appliance production overseas, relying on cheap labor to bring down costs. But wage increases in China and the willingness of the American worker to accept lower wages have GE bringing jobs back to the U.S., reports Dean Reynolds.
[Embedding disabled by request]
More seniors renting, sharing, swapping big ticket assets.
Sharing-for-Cash: A New Way to Finance Retirement
Deana Shelby and her husband, Dave Klemer, can thank honeymooners for making their dream retirement in Hawaii a reality.
The couple moved to an oceanside home on the island of Kauai when Klemer retired from his job in the computer industry in 2007.
Their property included a one-bedroom cottage, which the couple dubbed "The Honeymoon Cottage," and is available for rent at about $150 a night. In addition to a property manager, they use the web to woo guests, who are also charged $30 a day for Internet access and $20 for rides to and from the airport.
Washington Stuck Fighting Wrong Health-Care Battle
By Peter Orszag - Bloomberg.com
While Washington wonks continue to bicker over health policy, positive change is occurring outside the Beltway.
Last week, the Altarum Institute, a research organization based in Ann Arbor, Michigan,reported that the moderation in the growth of health-care costs we have seen over the past few years is continuing: Total health spending rose by less than 4 percent from February 2011 to February 2012. And it's encouraging to see the progress that doctors, hospitals and other providers are making to improve the value of care -- by cutting back on unnecessary procedures, for example, expanding their use of information technology, and switching from fee-for- service to compensation schemes aimed at maximizing the quality of treatment.
The Current State of Medicare Medicare, Health Care, U.S. Economy
Henry J. Aaron, Senior Fellow, Economic Studies
House Ways and Means Subcommittee on Health
At a hearing today before the House Ways and Means Subcommittee on Health, Henry Aaron argues for retaining and improving the current Medicare program.
In my statement I shall emphasize the following points:
• Medicare has been an overwhelming success in providing access to care for groups that before its enactment had only limited access to insurance or standard health care. It is popular across the political spectrum. Polls reveal that people would rather raise taxes than cut its benefits.
• Neither part B nor D faces any problem insolvency. They are adequately funded in perpetuity under current law.
• The Part A trust fund is currently in better shape financially than it has been for most of its history. If all provisions of the Affordable Care Act are enforced, its financial gap is small.
• Many are concerned over Medicare's long-term affordability. If provisions of the Affordable Care Act are enforced, the added budget costs of Medicare over the next quarter century are modest and affordable.
Missouri, Illinois to receive $19.8 million
in Affordable Care Act grants
St. Louis Business Journal by Greta Weiderman
U.S. Department of Health and Human Services Secretary Kathleen Sebeliustoday announced $10.3 million in grants awarded to community health centers in Missouri due to the new health care law, the Affordable Care Act. The money will go to support renovation and construction projects at the centers, which are located in Columbia, Kansas City, Kirksville and Springfield.
Missouri grantees estimate these awards will help them serve approximately 17,592 new patients.
Illinois community health centers estimate they'll be able to serve more than 17,700 new patients with the $9.5 million in grants to centers in the state, including a $500,000 grant to Southern Illinois Healthcare Foundation in Sauget, the only one in the St. Louis area to receive this round of funding.
Facebook Is Urging Members to Add Organ Donor Status
By MATT RICHTEL and KEVIN SACK - NYTimes.com
Nearly 7,000 people in the United States die each year while waiting for an organ transplant. It is a number that Facebook hopes to lower with its vast network of 161 million members in this country.
The company announced a plan on Tuesday morning to encourage everyone on Facebook to start advertising their donor status on their pages, along with their birth dates and schools — a move that it hopes will create peer pressure to nudge more people to add their names to the rolls of registered organ donors.
It is a rare foray by Facebook into social engineering from social networking, and one with a potentially profound effect, according to experts in the field of organ donation.
Georgia Girl Sues Classmates For Bullying Her On Facebook
ATLANTA (AP - CBSLocal.com) — When a Georgia middle school student reported to police and school officials that she had been bullied on Facebook, they told her there was not much they could do because the harassment occurred off campus.
So the 14-year-old girl, Alex Boston, is using a somewhat novel strategy to fight back: She's slapping her two classmates with a libel lawsuit.
As states consider or pass cyberbullying laws in reaction to high-profile cases around the country, attorneys and experts say many of the laws aren't strong enough, and lawsuits such as this one are bound to become more commonplace.
FDA may let patients buy drugs without prescriptions Move would increase patients' out-of-pocket costs
By Paige Winfield Cunningham-The Washington Times
In a move that could help the government trim its burgeoning health care costs, the Food and Drug Administration may soon permit Americans to obtain some drugs used to treat conditions such as high blood pressure and diabetes without obtaining a prescription.
The FDA says over-the-counter distribution would let patients get drugs for many common conditions without the time and expense of visiting a doctor, but medical providers call the change medically unsound and note that it also may mean that insurance no longer will pay for the drugs.
New Obama slogan has long ties to Marxism, socialism
By Victor Morton - WashingtonTimes.com
The Obama campaign apparently didn't look backwards into history when selecting its new campaign slogan, "Forward" — a word with a long and rich association with European Marxism.
Many Communist and radical publications and entities throughout the 19th and 20th centuries had the name "Forward!" or its foreign cognates. Wikipedia has an entire section called "Forward (generic name of socialist publications)."
"The name Forward carries a special meaning in socialist political terminology. It has been frequently used as a name for socialist, communist and other left-wing newspapers and publications," the online encyclopedia explains.
Obama embraces Islam If Islamism is OK for Egypt, why not America?
By THE WASHINGTON TIMES-Op/ED
The Obama administration is doing its utmost to promote the fortunes of the Islamist parties inEgypt. A State Department official declared that with the rise of these radical groups after the Arab Spring, "people who once might have gone into al Qaeda see an opportunity for a legitimate Islamism." They see this as a victory. The problem is, so do the terrorists.
Last year, the White House began peddling the line that the uprisings in the Middle East were a repudiation of the al Qaeda model of seeking change through terrorism. The argument was that while America opposed violent extremism, the rise of nonviolent radical movements was just fine, and even commendable. Al Qaeda leader Ayman al-Zawahri quickly dismissed this claim, saying that from the terrorists' point of view, it didn't matter whether an Islamist victory came through violence or not. The means were unimportant except as they related to the end state: the imposition of hard-line Shariah-based laws and policies.
Obama flies to Afghanistan, signs pact with Karzai
By Ben Feller - AP White House Correspondent - Boston.com
KABUL, Afghanistan—President Barack Obama slipped into Afghanistan Tuesday night on the anniversary of the killing of 9/11 mastermind Osama bin Laden and signed an agreement cementing U.S. commitment to the nation after American combat troops leave.
Alongside Afghan President Hamid Karzai, Obama declared, "Together, we're now committed to replacing war with peace."
The partnership spells out the U.S. relationship with Afghanistan beyond 2014, covering security, economics and governance. The deal is limited in scope and essentially gives both sides political cover: Afghanistan is guaranteed its sovereignty and promised it won't be abandoned, while the U.S. gets to end its combat mission in the long and unpopular war but keep a foothold in the country.
Glenn Hubbard:
Obama's Budget Means a Tax Increase on Everyone
[Google title for free article pass] Maintaining the president's higher spending levels will require raising taxes for all Americans, including an 11% increase on those earning less than $200,000.
By GLENN HUBBARD - WSJ.com
The defeat in the Senate of the so-called "Buffett Rule"—that targets millionaires for a tax increase—marks one more step in the election-year discussion about raising taxes on higher-income individuals to close the nation's yawning budget gap.
Since 2008, a rising share of the economy—an estimated 24.3% of GDP in 2012, according to the Office of Management and Budget, up from 20.8% four years earlier—has been devoted to federal spending. The problem gets much worse. The Congressional Budget Office estimates that, absent changes in policy, the nation will spend 10 percentage points of GDP more on Social Security, Medicare, Medicaid and related programs in 2058 than it does today.
Soros Election-Rigging Project Dies?
By MATTHEW VADUM - The American Spectator.org
The mysterious disappearance of the Secretary of State Project.
Whatever happened to the left-wing Secretary of State Project liberals promised would save our elections from the dirty tricks of those dang lowdown, yellow-bellied, lily-livered Republicans?
The evidence now suggests that the election-stealing, George Soros-funded so-called "527" political committee is dead, or perhaps just deeply sedated. This group that section 527 of the U.S. Internal Revenue Code allows to accept unlimited financial contributions was created solely to rig elections for Democrats.
May Day display: Hundreds of thousands rally worldwide
Moscow's streets are brimming with people this May Day - with most celebrating, and some demonstrating. Trade Unions marched under the Labour Day flag to demand better working conditions. And even Russia's ruling tandem took to spearheading a crowd of their supporters. RT's Irina Galushko was there.
Opposition members are also out to get their message across. Among them, the country's second-largest party, which still refuses to accept last year's parliamentary election results, and is unhappy about Vladimir Putin's return to The Kremlin. Jacob Greaves reports from amid a sea of red flags.
May the 1st is also being marked with mass Labour Day marches worldwide. In Europe - several large nationwide demos are underway.
* * * * *
The election could be more about Unions (i.e. preserving pension promises) than candidates... huge power struggle brewing.
Will Election 2012 Hinge on Union Busting?
By Steve Benen - WashingtonMonthly.com [May 10, 2011]
When GOP governors this winter began trying to bust public employee unions, a pillar of Democratic electoral strength, it seemed like a diabolically savvy political move, the kind Karl Rove used to call a "game changer." Yet in the weeks that followed, poll after poll showed voters siding with the unions over the governors. The Republican effort was particularly unpopular among groups like independents in Ohio who may well decide the 2012 elections.
Instead of backing down, the GOP has doubled down. Anti-union legislation has now spread to nearly half the states. With the primary season heating up, GOP presidential candidates will soon be under pressure to publicly side with the union busters — a stance that Barack Obama and other Democrats will surely remind voters of in the general election.
Wisconsin Vote Is First Shot in Wider Union War
Recall Election Tests Strategies for November
By JIM RUTENBERG and STEVEN GREENHOUSE - NYTimes.com
GREEN BAY, Wis. — "Recall Walker" bumper stickers dotted the workers' parking lot at the Georgia Pacific paper mill on Day Street here one recent afternoon, proof of their union's role in the effort to oust Gov. Scott Walker from office early for his legislation limiting public employees' bargaining rights.
But among the largest donors to Mr. Walker and his cause are the plant's owners, the billionaire industrialists Charles G. and David H. Koch, the latter of whom has said of the recall election to be held in June, "If the unions win the recall, there will be no stopping union power."
The recall vote here has been billed as a critical test of labor muscle versus corporate money. But it is only a warm-up for a confrontation that will play out during the presidential election, which both sides v
RSS![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/images/quotes_7a.gif)