STOCK MARKET WATCH, Thursday, July 14, 2011

Source: du

STOCK MARKET WATCH, Thursday, July 14, 2011

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Euro, Yen, Loonie, Silver and Gold

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Bush Administration Officials Convicted = 2
Names: David Safavian, James Fondren
Dishonorable Mention: former House majority leader, Tom DeLay

Bush Administration Officials Charged = 1
Name(s): Richard Lopez Razo

Financial Sector Officials Convicted since 1/20/09 = 12

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http://l.yimg.com/bt/api/res/1.2/BXjfxNFoN6YxuRHLKQSoug--/YXBwaWQ9eW5ld3M7Zmk9Zml0O3E9ODU7dz05NTA-/

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This thread contains opinions and observations. Individuals may post their experiences, inferences and opinions on this thread. However, it should not be construed as advice. It is unethical (and probably illegal) for financial recommendations to be given here.

Read more: du

Jul 14 08:30 Initial Claims 07/09 370K 410K 418K
Jul 14 08:30 Continuing Claims 07/02 3700K 3700K 3681K
Jul 14 08:30 Retail Sales Jun -0.3% -0.2% -0.2%
Jul 14 08:30 Retail Sales ex-auto Jun -0.1% 0.0% 0.3%
Jul 14 08:30 PPI Jun -0.2% -0.2% 0.2%
Jul 14 08:30 Core PPI Jun 0.2% 0.2% 0.2%
Jul 14 10:00 Business Inventories May 0.9% 0.9% 0.8%

Read more: http://www.briefing.com/investor/calendars/economic/2011/07/11-15/#ixzz1S51F45gL

The number of Americans filing first-time claims for unemployment benefits dropped to the lowest level since April, a sign weakness in the labor market may be starting to abate.

Applications for jobless benefits decreased 22,000 in the week ended July 9 to 405,000, Labor Department figures showed today. Economists forecast 415,000 claims, according to the median estimate in a Bloomberg News survey. The data included fewer layoffs in the auto industry than typical this time of the year, according to an agency spokesman.

A sustained reduction in firings is a first step toward a pickup in hiring after employers in June added the fewest workers in nine months and the jobless rate rose. Federal Reserve Chairman Ben S. Bernanke said yesterday that “disappointing” job growth in the last two months was due to temporary effects, such as high fuel costs and delayed parts shipments from Japan.

“We need them get down around 350,000 before we can see the labor market really taking off,” David Semmens, a U.S. economist at Standard Chartered Bank in New York, said before the report.

http://www.bloomberg.com/news/2011-07-14/initial-jobless-claims-in-u-s-fell-22-000-last-week-to-405-000.html

SINGAPORE – Oil prices hovered above $98 a barrel Thursday in Asia amid speculation about a possible new round of U.S. monetary stimulus while a rating agency put the country's credit rating under review for a downgrade.

Benchmark oil for August delivery was up 12 cents to $98.17 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. Crude rose 62 cents to settle at $98.05 on Wednesday.

In London, Brent crude fell 3 cents to $118.75 per barrel on the ICE Futures exchange.

Federal Reserve Chairman Ben Bernanke said Wednesday he is considering another round of Treasury bond purchases, known as quantitative easing, in a bid to lower interest rates and spur lending and economic growth.

http://old.news.yahoo.com/s/ap/oil_prices

U.S. stock futures gained, erasing losses that followed Moody’s Investors Service’s review of America’s credit rating, as JPMorgan Chase & Co. (JPM) reported earnings that topped estimates.

Futures on the Standard & Poor’s 500 Index expiring in September climbed 0.4 percent to 1,317.3 at 7:29 a.m. in New York, after earlier losing 0.7 percent. Dow Jones Industrial Average futures expiring the same month rose 29 points, or 0.2 percent, to 12,454.

http://www.bloomberg.com/news/2011-07-14/u-s-stock-index-futures-advance-yum-brands-climbs-on-increased-profit.html

:donut:

Yesterday I officially worked 9 hours, but of course, it was more....but I did get paid for making pie!

Two cherry (starting from pitting Michigan cherries out of the farmers market) and one blueberry (supposedly Michigan blues according to the label) and a baby peach pie.

Anybody want to pay me to make pie? I'll accept any reasonable offer...

Still have more cherries. I might have to make preserves...

And gardening! Actually did some gardening! It was nearly as good as going to heaven, except I hurt today.

Will you hit someone in the face with it. I know there's probably a service charge involved.


As for gardening, I'm ready to prepare my beds for the fall planting. And I'm going to add extra room for strawberries.

Everything out there is pretty much shot for this season, except for the peppers and watermelon. The habaneros and jalapenos are growing insane. I've filled the dehydrator 4 times,and picked a big bag of peppers and took them to the cook at the bar, and the plants are still loaded.

My dogs would never permit gardening like that.

I'm Demeter, not the 3 Stooges. They used shaving cream.

I remember when we hit Jerry Rubin (Yippee!) in the face with one on his 30th birthday in Miami.

He always said, "Never trust anyone over 30."

I have a small patch of everbearing strawberries that give me a small handfull every day.
:)

Black berries on the pole line that cuts through the back 50.

They'll be ready for picking in 3-5 weeks. The pantry is always stocked with a hundred pounds of flour, sugar, etc

I'll keep the oven free for you!

Can I bring the Kid? She can help.

Clams are dependant on the flats not being closed due to 'Red Tide'

The kid sleeps with you. But, the spare bedroom has a queen sized bed. You'll have to maneuver around the pile of lumber drying. (the future lower kitchen cabinets)

I've been sleeping in the living room while waiting for the energy to finish the floors upstairs...

If I can figure out how to get away from the jobs...

blueberry pancakes get drowned in maple syrup. (The real stuff)

I'd be there for picking the berries

We'd go pick them, and my mom would make a big cobbler. Mmmmmm

The amount of food that's free for the taking on pole line ROW's, and how few people take advantage of it.

They don't mow those ROW, they spray them

And it's only applied manually. Very little drift. Areas with dense berry growth are naturally free of tree growth. The two (trees/berries) do not mix.

The commercial fields are abused with a hellofa lot more chemical shit, than that.

What I'm saying is too many people are too friggin lazy!

The portion of line that cuts through our back 50 is not treated. 9 acres I have to keep the growth down on. Too many boulders to be able to use the brush hog on most of it, so it's chain/brush saw every 3-4 years.

Spouse's favorite is cherry!

Once I made a cherry pie, it was a lot of work, and time, pitting all these cherries. But the pie was delicious!

6 cups for another batch of jam.. been wondering what to do with the other 4 cups...

Pie! :bounce:

Crush 2-3 cups berries, add 1 Cup sugar and 3 Tablespoons cornstarch, cook until smooth, pour over rest of berries in graham cracker crust. Chill and serve.

Much better than the commercial glaze.

Moody’s Investors Service raised the pressure on U.S. lawmakers to increase the government’s $14.3 trillion debt limit by placing the nation’s credit rating under review for a downgrade.

The U.S., rated Aaa since 1917, was put on review for the first time since 1995 on concern the debt threshold won’t be raised in time to prevent a missed interest or principal payment on outstanding bonds and notes, even though the risk remains low, Moody’s said in a statement yesterday. The rating may be reduced to the Aa range, and there is no assurance Moody’s would restore its top rating, even if a default is quickly “cured.”

President Barack Obama is considering summoning congressional leaders to Camp David this weekend to work on a plan to raise the debt ceiling after yesterday’s negotiations on a deficit-cutting plan of at least $2 trillion stalled, according to two people familiar with the matter. A default resulting from a failure to raise the debt limit may lead to slower economic growth and another financial crisis.

“It’s obviously very serious in so many different ways,” said James Caron, head of U.S. interest-rate strategy at Morgan Stanley in New York, one of 20 primary dealers that trade bonds with the Federal Reserve. “Most people still believe there will be some type of an agreement struck to avoid all this stuff, and that’s what the market’s banking on.”

http://www.bloomberg.com/news/2011-07-13/u-s-debt-rating-placed-on-review-for-downgrade-by-moody-s-as-talks-stall.html

I'm thinking the fools and idiots won't raise the debt ceiling....until after the election.

A lot of the countries with low debt to GDP ratios are either rather undeveloped or big exporters usually of oil or natural resources.

And don't they figure in as a part of our government debt, the bonds held by Social Security which are owed to American seniors, necessarily paid out only in small annual amounts and intended to be used for the payment of future costs (the baby boomers' retirement)?

http://en.wikipedia.org/wiki/List_of_sovereign_states_by_public_debt

On this chart, the US debt including the debts of the states is 92.7. That is the amount the Republicans are bandying about.

But the debt of the federal government is only 58.9% of GDP. That is the only amount that Obama and Congress can directly determine through their process it would seem to me.

I note that Libya has virtually no debt.

A lot of the oil-rich countries have little debt. Surprise! Instead of worrying about cutting our budget, we should try to become oil-independent. How about that for a deficit reduction plan?

It's unAmerican.

a high rating.

That's interference in the politics of a country.

We don't need investment that is conditioned upon a rating by a company that rates economies with politically conservative leaders above economies with leaders of other political persuasions.

A conservative government does not guarantee that a country is a healthy place to invest.

Sorry. I would rate Moody's as -FFFFFFF.

They rated the subprime mortgages highly as did the other ratings agencies. Their ratings are worthless. Anyone who is influenced by them is a fool.

Colombia remains a country dominated by criminals and a drug economy as far as I have heard. And Moody's really doesn't deal with that except to say that crime is down. Maybe the conservative government just allows the criminals to operate in peace?

What does Moody's really know? Not much from what I learned in Summer and Fall of 2008.

http://www.bloomberg.com/news/2011-07-14/retail-sales-in-u-s-probably-stagnated-as-auto-demand-cooled.html

Sales at U.S. retailers probably stagnated in June, reflecting declining auto demand and rising unemployment, economists said before a report today.

The projected 0.1 percent drop in purchases would follow a 0.2 percent May decrease, according to the median forecast of 79 economists surveyed by Bloomberg News. Another report may show wholesale prices fell last month.

Supply constraints due to Japan’s earthquake helped push car sales last month to the lowest level since June 2010, while unemployment prompted stores like Target Corp. (TGT) and Gap Inc. to sweeten discounts to lure customers. A dearth of jobs raises the risk that consumer spending, which makes up 70 percent of the economy, will have difficulty picking up for the rest of 2011.

“Improvements in retail sales will remain elusive if job growth does not re-accelerate,” said Russell Price, a senior economist at Ameriprise Financial Services Inc. in Detroit. “Consumers still face a very tough environment.”

http://www.marketwatch.com/story/june-retail-sales-edge-up-01-2011-07-14?siteid=rss

WASHINGTON (MarketWatch) — Sales at U.S. retailers increased a slim 0.1% in June, the Commerce Department estimated Thursday, better than economists expected but also further evidence of the reluctance of consumers to spend.

The slight increase in June sales was unexpected. Ahead of the report, economists surveyed by MarketWatch expected sales to fall 0.2%.

There were several cross-currents in the data. The increases were heaviest in sales of building materials and department stores. Gasoline sales were a large drag, as was expected, because of the recent decline in prices at the pump.

Federal Reserve Chairman Ben S. Bernanke signaled the central bank has more tools for monetary easing should the economy weaken and stymie efforts to generate jobs for 14.1 million unemployed Americans.

The Fed could pledge to keep the main interest rate at a record low and hold its balance sheet at $2.87 trillion for a longer period, Bernanke said yesterday in congressional testimony. It could also buy more bonds, increase the average maturity of its securities holdings or cut the interest rate it pays banks on their reserves, he said.

“We have to keep all the options on the table,” Bernanke said in semi-annual testimony to the House Financial Services Committee. The “economy still needs a good deal of support.”

After predicting the economy will strengthen during the second half of 2011, Bernanke left open the door to further stimulus by saying that sagging home prices, hard-to-get loans and 9.2 percent unemployment pose long-term obstacles to growth. Stocks rose and the dollar weakened after Bernanke’s comments.

http://www.bloomberg.com/news/2011-07-14/bernanke-signals-fed-has-tools-to-spur-growth-if-economy-fails-to-rebound.html

You know, if you take all of the emotion out of it, the level of delusion is fascinating.

How any of these people got a positive reputation for anything is beyond me.

http://www.bloomberg.com/news/2011-07-13/china-cities-sell-land-at-winnetka-values-with-bonds-seen-toxic.html

Workers toil by night lights with hoes, carving out the signs for Olympic rings in front of an unfinished 30,000-seat stadium, bulb-shaped gymnasium and swimming complex in a little-known Chinese city.

Loudi, home to 4 million people in Chairman Mao Zedong’s home province of Hunan, is paying for the project with 1.2 billion yuan ($185 million) in bonds, guaranteed by land valued at $1.5 million an acre. That’s about the same as prices in Winnetka, a Chicago suburb that is one of the richest U.S. towns, where the average household earns more than $250,000 a year.

In Loudi, people take home $2,323 annually and there are no Olympics here on any calendar.

“The debt isn’t a problem as Loudi is not a developed place,” Yang Haibo, an official at the city’s financing vehicle, says as he sits with colleagues in a smoke-filled meeting room under a No Smoking sign. “It’s an emerging city.”

http://www.bloomberg.com/news/2011-07-14/japanese-stocks-fall-as-moody-s-threat-drives-down-dollar-nissan-declines.html

Japanese stocks fell for the third time this week after Moody’s Investors Service said it may cut the U.S.’s credit rating, driving down the dollar against the yen and hurting the outlook for Asian exporters.

Toyota Motor Corp., which counts North America as its largest market, lost 0.7 percent. Nippon Yusen K.K., Japan’s biggest shipping line by sales, retreated 1.7 percent after cargo rates dropped. Dainippon Screen Manufacturing Co. led declines among chip-related companies after ASML Holding NV, Europe’s biggest maker of semiconductor equipment, said orders weakened.

The Nikkei 225 Stock Average fell 0.3 percent to 9,936.12 at the 3 p.m. close in Tokyo. The gauge spiked as much as 0.4 percent after the yen weakened amid speculation Japan will sell the currency to protect manufacturers. The broader Topix declined 0.4 percent to 856.88.

“If the U.S. government, facing revenue shortfalls because of the restriction on the issuance of new government bonds, increases taxes or reduces budget expenditures, a negative impact on the economy will be unavoidable,” said Naoki Fujiwara, who helps oversee $6 billion at Shinkin Asset Management Co. in Tokyo. “Exporters to the country will be damaged if consumer spending becomes stagnant.”

you. You should worry about your own debt which is much greater than ours.

http://uk.reuters.com/article/2011/07/14/markets-southeastasia-stocks-idUKL3E7IE09L20110714

BANGKOK, July 14 (Reuters) - Southeast Asian stock markets
were mostly steady to slightly higher on Thursday despite
jitters caused by a Moody's warning about a possible downgrade
of its U.S. credit rating that pushed investors towards safe
havens such as gold.

Trading volume was generally thin amid continued caution
about the euro zone debt crisis, although such worries have not
stopped Indonesia , Malaysia and the Philippines
, setting record highs this month.

Stocks in Singapore and Thailand ended
flat. Thai turnover was just below its 30-day average as
investors wound down ahead of a three-day holiday weekend.

Investors sought companies with high dividend yields and
expected to release strong earnings as the reporting season gets
under way this month, brokers in the region said.

http://uk.reuters.com/article/2011/07/14/china-rareearth-chen-idUKL3E7IE13L20110714

BEIJING/SHANGHAI, July 14 (Reuters) - China on Thursday issued a second batch of quotas for exports of rare earths this year -- virtually making up for previous cuts -- after its commerce minister met with his EU counterpart to discuss this and other thorny issues between the two trading partners.

The announcement of 15,738 tonnes in the second batch of quotas for 2011 adds to the first round of 14,446 tonnes announced late last year. It also comes just a week after the World Trade Organization ruled against China's curbs on a different mix of raw materials but which some trade partners say could set a precedent.

The WTO's ruling last week that China had breached trade law by curbing exports of eight raw materials led Europe and the United States to say that meant China should also be forced to increase exports of 17 rare earths.

"We feel that a total of around 30,000 tonnes this year is a reasonable number given that Beijing probably does not want to cut the quota a lot, as that could bring more criticism from foreign countries," said an analyst at a foreign-invested fund in Beijing.

http://uk.reuters.com/article/2011/07/14/markets-hongkong-china-stocks-update-idUKL3E7IE1N020110714

HONG KONG/SHANGHAI, July 14 (Reuters) - Record-high gold prices lifted Shanghai shares on Thursday, a day when most Asian stock markets were down or flat as investors fretted about debt woes on both sides of the Atlantic Ocean.

The Shanghai Composite Index closed up 0.5 percent to 2,810.4 points, lifted by strong gold miners for a second-straight session.

Spot gold hit a high of $1,592.70 an ounce and was up 0.65 percent at $1,592.24 an ounce at 0920 GMT.

In Shanghai, Zijin Mining Group Co was the most active shares and the biggest gainers in the market, jumping 6.3 percent, while Jinduicheng Molybdenum Co rallied 2.5 percent.

http://www.bloomberg.com/news/2011-07-14/european-stock-futures-in-retreat-as-moody-s-puts-u-s-on-review-on-debt.html

European stocks fell for the fourth day in five after Italy auctioned bonds and Moody’s Investors Service said the American government may lose the Aaa credit rating it’s held since 1917. Asian shares dropped, while U.S. index futures advanced.

Petrofac Ltd. (PFC), the U.K.-based oilfield services and engineering provider, decreased 3.1 percent as Barclays Plc advised selling the shares. Accor SA (AC) slid 1 percent as rival Marriott International Inc. forecast earnings that fell below analysts’ estimates for its per-share profit. Software AG (SOW) plunged 13 percent, its largest slide in more than two years, after posting a decline in sales.

The Stoxx Europe 600 Index sank 0.7 percent to 268.06 at 12:27 p.m. in London. Futures contracts on the Standard & Poor’s 500 Index expiring in September gained 0.3 percent, while the MSCI Asia Pacific Index retreated 0.2 percent.

“Moody’s action overnight was a response to the small but rising risk of a short-lived default,” wrote Jim Reid, a global strategist at Deutsche Bank AG in London, in a report today. “Moody’s is now the rating agency putting most pressure on Congress to act.”

http://www.bloomberg.com/news/2011-07-13/euro-crisis-in-uncharted-territory-menaces-eastern-states-berglof-says.html

The European debt crisis has entered “uncharted territory,” rekindling concern it will spread eastward through banking and trade links, according to the European Bank for Reconstruction and Development.

Italy’s Unicredit SpA (UCG) and Intesa Sanpaolo SpA (ISP), two of eastern Europe’s biggest lenders, fell to the lowest in more than two years July 11 as political infighting threatened to delay efforts to cut the budget deficit in the country with Europe’s largest debt burden. European leaders this week failed to agree on a new aid package for Greece.

“We are in uncharted territory,” Erik Berglof, chief economist at the London-based EBRD, which invests in eastern Europe and Central Asia, said in a July 12 interview. “The source of the contagion seems to be in worse shape.”

http://www.creditwritedowns.com/2011/07/eastern-europe-sovereign-debt.html

“The market is pricing these sovereigns at much wider levels than where their agency ratings would imply,” said Diana Allmendinger, a director at Fitch Solutions. CDS on Italy imply a rating of BBB, five notches below its agency rating of AA-minus. And Spain’s implied rating is BB-plus, nine notches below its agency rating of AA-plus.

With so much emphasis being placed on what has been happening farther to the South, economic realities on Europe’s Eastern periphery have largely been escaping the close scrutiny of media and analyst attention. In the wake of the belated recognition of the region’s vulnerability which followed the bout of acute stress experienced during the post-Lehman crisis, a new consensus has now emerged (for an in-depth study of the Latvian example see this piece) that the IMF-guided programmes put in place at the time have essentially set things, if not entirely straight then at least on the right track. In particular, as a result of the extensive fiscal discipline and willingness to sacrifice shown a much brighter future now awaits these countries well to the sidelines of all those horrible Greek debt concerns.

Certainly this is the picture you get from looking at the way the ratings agencies have been treating many of the countries in the region. Only last week Fitch upgraded Estonia to A+, citing the country’s solid economic growth performance, exceptionally strong public finances, declining external debt ratios and increasing stabilization in the banking sector. But since many reservations have been expressed in Europe of late about the validity of rating assessments, I thought it might be interesting to seek out an alternative opinion, and take a look at what the financial markets have been saying, at least as far as the recent evolution of Credit Default Swap prices go.

The recently upgraded Estonia, for example, was being valued as recently as just two years ago as having the third-riskiest sovereign debt in the European Union. But the country is now trading in quite another league, and finds itself included among the European “top ten” sovereigns in terms of price. As reported by Bloomberg on 20 June, Estonian credit-default swaps were trading at 87 basis points, while France was being quoted at 83.7, the Czech Republic at 83, Austria at 68.7 and the U.K. at 66, according to data provided by CMA. By way of comparison Polish CDS stood at 159.6. Effectively, Poland was being considered as almost twice as risky as Estonia. The big question, of course, is whether this kind of realignment in valuations makes any kind of economic sense? Is contagion risk being reasonably priced in, and if it isn’t, do we face the risk of a sudden (and destabilising) adjustment in the not too distant future?

http://www.bloomberg.com/news/2011-07-14/ftse-100-stocks-decline-hsbc-rio-tinto-group-bp-lead-retreat-in-london.html

U.K. stocks declined for the fourth day in five after Moody’s Investors Service said the U.S. government may lose the Aaa credit rating it’s held since 1917.

Intercontinental Hotels Group Plc (IHG) decreased 1.8 percent after U.S. rival Marriott International Inc. forecast earnings per share that fell below analysts’ estimates. Petrofac Ltd. (PFC) dropped 2.6 percent after Barclays Plc downgraded the shares. Fresnillo Plc (FRES), the world’s largest primary silver producer, gained 2 percent after reporting record second-quarter volumes.

The FTSE 100 Index (UKX) decreased 0.7 percent to 5,866.64 at 10:38 a.m. in London, as four shares retreated for every one that advanced. The benchmark measure has dropped 3.7 percent from this year’s high on Feb. 8. The FTSE All-Share Index lost 0.7 percent today, while Ireland’s ISEQ Index fell 0.3 percent.

“We believe U.S. politicians will arrive at a solution, but the longer they wait, the more they add uncertainty to financial markets, and that’s just the thing nobody needs now before the European banks stress tests being published tomorrow and the Italian vote on budget cuts,” said Michael Borre, chief equity adviser at Nordea Private Banking in Copenhagen.

http://www.irishtimes.com/newspaper/breaking/2011/0714/breaking13.html

EU leaders are struggling to make headway in the battle over a second Greek bailout as pressure builds for a tough new response to the debt crisis.

As Germany blocked plans for an emergency euro zone summit tomorrow, notional Irish borrowing costs jumped to new records after credit rating agency Moody’s imposed a “junk” grade on Irish debt.

The EU Commission intensified its criticism of the downgrade, saying it was “incomprehensible”, and Germany said it was “completely at odds” with the recent views of other rating agencies.

Incoming European Central Bank chief Mario Draghi said the debt emergency had “entered a new phase” and called on political leaders to come up with a clear response to the contagion. “We have to recognise that management of the financial crisis has not gone smoothly with partial and temporary interventions,” he said in a speech to the Italian banking association in Rome.

http://www.truth-out.org/why-euro-not-worth-saving/1310416045

Since the point of all this self-inflicted misery is to save the Euro, it is worth asking whether the Euro is worth saving....


It is often argued that the monetary union, which now includes 17 countries, must be maintained for the sake of the European project. This includes such worthy ideals as European solidarity, building common standards for human rights and social inclusion, keeping right-wing nationalism in check, and of course the economic and political integration which underlies such progress. But this confuses the monetary union, or Eurozone, with the European Union itself. Denmark, Sweden, and the UK, for example, are part of the EU but not part of the monetary union. There is no reason that the European project cannot proceed, and the EU prosper, without the Euro. And there are good reasons to hope that this may happen. The problem is that the monetary union, unlike the EU itself, is an unambiguously right-wing project. If this has not been clear from its inception, it should be painfully clear now, as the weaker Euro-zone economies are being subjected to punishment that had previously been reserved for low- and middle-income countries caught in the grip of the International Monetary Fund (IMF) and its G-7 governors. Instead of trying to get out of recession through fiscal and/or monetary stimulus, as most of the world’s governments did in 2009, these governments are being forced to do the opposite, at enormous social cost. The insults added to injury, as with the privatizations in Greece or “labor market reform” in Spain; the regressive effects of the measures taken on the distribution of income and wealth; and the shrinking and weakening of the welfare state, while banks are bailed out at taxpayer expense – all this advertises the clear right-wing agenda of the European authorities, as well as their attempt to take advantage of the crisis to institute right-wing political changes....The right-wing nature of the monetary union had been institutionalized from the beginning. The rules limiting public debt to 60 percent of GDP and annual budget deficits to 3 percent of GDP – while violated in practice, are unnecessarily restrictive in times of recession and high unemployment. The European Central Bank’s mandate to care only about inflation, and not at all about employment, is another ugly indicator. The U.S. Federal Reserve, for example, is a conservative institution but it is at least required by law to concern itself with employment as well as inflation. And the Fed -- for all its incompetence in failing to recognize an $8 trillion housing bubble that crashed the U.S. economy -- has proved to be flexible in the face of recession and a weak recovery, creating more than $2 trillion as part of an expansionary monetary policy. By comparison, the extremists running the European Central Bank have been raising interest rates since April, despite depression-level unemployment in the weaker Eurozone economies.


Some economists and political observers argue that the Eurozone needs a fiscal union, with greater coordination of budgetary policies, in order to make it work. But right-wing fiscal policy is counter-productive, as we are witnessing, even were it to be better coordinated. Other economists – including this one – have argued that the large differences in productivity among the member economies present serious difficulties for a monetary union. But even if these problems could be overcome, the Eurozone would not be worth the effort if it is a right-wing project...European economic integration prior to the Eurozone was of a different nature. Unlike the “race-to-the-bottom” approach of the North American Free Trade Agreement (NAFTA) – which displaced hundreds of thousands of Mexican farmers while contributing to reduced wages and manufacturing employment in the U.S. and Canada – the European Union made some efforts to pull the lower-income economies upward and protect the vulnerable. But the European authorities have proved to be ruthless in their monetary union.

The idea that the Euro must be saved for the sake of European solidarity also plays on an oversimplified notion of the resistance that taxpayers in countries such as Germany, the Netherlands, and Finland have demonstrated to “bailing out” Greece. While it is undeniable that some of this resistance is based on nationalist prejudice – often inflamed by the mass media – that is not the whole story. Many Europeans don’t like to pay the bill for bailing out European banks that made bad loans. And the EU authorities are not “helping” Greece any more than the U.S. and NATO are “helping” Afghanistan – to take a somewhat analogous debate where those who oppose destructive policies are labeled “backward” and “isolationist.”

It appears that much of the European left does not understand the right-wing nature of the institutions, authorities, and especially macroeconomic policies that they are facing in the Eurozone. This is part of a more general problem with the public misunderstanding of macroeconomic policy worldwide, which has allowed right-wing central banks to implement destructive policies, sometimes even under left governments. These misunderstandings, along with the lack of democratic input, might help explain the paradox that Europe currently has more right-wing macroeconomic policies than the United States, despite having much stronger labor unions and other institutional bases for more progressive economic policy.

*******************************************

This article was also published in The Guardian Unlimited (U.K.) on July 11, 2011.

http://www.irishtimes.com/newspaper/finance/2011/0714/1224300712362.html

RELAND SAW its bond yields soar to record highs yesterday after it became the third member of the euro zone to have its credit rating cut below investment grade.

European stock markets enjoyed a relief rally as investors speculated that the recent sell-off sparked by Italian contagion fears may have been overdone, and that a solution to the currency bloc’s sovereign debt crisis may yet be found.

Spanish and Italian debt markets recovered somewhat on hopes that Europe may “sort something out”, a Dublin trader said.

However Irish bonds moved in the opposite direction following Moody’s downgrade of Irish debt to junk status on Tuesday evening.

http://www.irishtimes.com/newspaper/finance/2011/0714/1224300712097.html

FTSE: 5,904.19 (+35.23) Mid-250: 11,841.47 (+63.45) Small Cap: 3,276.59 (+1.17)

CONFIRMATION THAT News Corporation dropped its bid to take full control of British Sky Broadcasting sent shares in the pay-TV company on a volatile run yesterday.

Having hit a year-low of 663½p after news of the demise of the deal broke it bounced back as traders considered their response to the news and took account of the underlying fundamentals of the business.

In a statement issued after the television reports of the development were first carried on Sky News, News Corporation’s Chase Carey, deputy chairman, president and chief operating officer, said: “It has become clear that it is too difficult to progress in this climate. News Corporation remains a committed long-term shareholder in BSkyB. We are proud of the success it has achieved and our contribution to it.” Shares in News Corp rose 2 per cent to $15.69.

http://www.irishtimes.com/newspaper/breaking/2011/0714/breaking9.html

Ireland is on track and meeting all targets laid down in the EU-IMF bailout deal, the “troika” of international powers has told the Government.

Following its third quarterly review, the EU-IMF-ECB assessment team said the Government had completed all 17 actions specified in the memo for the quarter, according to the Department of Finance.

The period under review covered the three months up to the end of June,

and included elements of the programme for government including the jobs initiative, its funding mechanism and the reverse of the minimum wage.

http://www.csmonitor.com/Business/Robert-Reich-s-Blog/2011/0712/Obama-try-this-for-a-jobs-plan

What did the President do in response to last week’s horrendous job report — unemployment rising to 9.2 percent in June, with only 18,000 new jobs (125,000 are needed each month just to keep up with the growth in the potential labor force)?

He said the economy continues to be in a deep hole, and he urged Congress to extend the temporary reduction in the employee part of the payroll tax, approve pending free-trade agreements, and pass a measure to streamline patent procedures.

To call this inadequate would be a gross understatement.

Here’s what the President should have said:

This job recession shows no sign of ending. It can no longer be blamed on supply-side disruptions from Japan, Europe’s debt crisis, high oil prices, or bad weather.

http://www.truth-out.org/end-trickle-down-economics-pay-debt/1310409720

President Obama has given speech after speech calling on Congress to reduce tax breaks for the wealthy to balance the budget. When President Clinton left office, the budget had been balanced for four consecutive years with surpluses projected through 2011. The tax rate for the wealthiest 2 percent of wage earners was 39.6 percent. President George W. Bush, however, chose to pursue the system of so-called “trickle-down” economics through tax breaks for the wealthiest Americans.

The result: surplus turned into deficit. By the end of Bush’s second term, the United States was embroiled in the gravest financial crisis since the Great Depression.

Trickle-down economics has not worked since Herbert Hoover tried it. It is a myth that adding money to the wealthy through tax cuts stimulates jobs and grows the economy. Under Democratic presidents since 1930 who have emphasized people programs and resisted tax breaks for the richest, annual growth in GDP has averaged 5.4 percent, according to Commerce Department and Office of Management and Budget statistics.

Under Republican presidents who enacted tax cuts for the rich, paralleling the policies being put forth by the current crop of Republicans, GDP has only grown by 1.6 percent.

Fuck BLS and their inflation index
The first number is 1 year ago. The second is today

Soy beans $940/$1384

Corn $360/$690

Rice $12/$16.90

Wheat $460/$719

Orange Juice $145/$191

Coffe $190/$263

Sugar $21/$29

Cotton $80/$110

Oil $68/$98

Heating Oil $190/$310

So if it feels like D2D expenses are choking your budget, guess what, they are!

Fuck BLS. Fuck BLS. Fuck BLS. Fuck the FED. Fuck the FED. :grr:

Add in that most of that increase is due to speculation, and you've got a revolution on your horizon.

FRN's attaining toilet tissue status, courtesy of the fucking FED.
YMMV

Oh, wait.

http://www.nytimes.com/2011/07/13/opinion/13likosky.html

FOR decades, we have neglected the foundation of our economy while other countries have invested in state-of-the-art water, energy and transportation infrastructure. Our manufacturing base has migrated abroad; our innovation edge may soon follow. If we don’t find a way to build a sound foundation for growth, the American dream will survive only in our heads and history books...But how we will pay for it? Given the fights over the deficit and the debt, it is doubtful that a second, costly stimulus package could gain traction. President Franklin D. Roosevelt faced a similar predicament in the 1930s when the possibility of a double-dip Depression loomed. For this reason, the New Deal’s second wave aggressively pursued public-private partnerships and quasi-public authorities. Roosevelt described the best-known of these enterprises, the Tennessee Valley Authority, as a “corporation clothed with the power of government but possessed of the flexibility and initiative of a private enterprise.” A bipartisan bill introduced by senators including John Kerry, Democrat of Massachusetts, and Kay Bailey Hutchison, Republican of Texas, seeks a similar but modernized solution: it would create an American Infrastructure Financing Authority to move private capital, now sitting on the sidelines in pension, private equity, sovereign and other funds, into much-needed projects.

Rather than sell debt to investors and then allocate funds through grants, formulas and earmarks, the authority would get a one-time infusion of federal money ($10 billion in the Senate bill) and then extend targeted loans and limited loan guarantees to projects that need a push to get going but can pay for themselves over time — like a road that collects tolls, an energy plant that collects user fees, or a port that imposes fees on goods entering or leaving the country...The idea of such a bank dates to the mid-1990s. Even then, our growth was hampered by the inadequacy of our infrastructure and a lack of appetite for selling public debt to cover construction costs. Today we find ourselves trapped in a vicious cycle that makes this proposal more urgent than ever. Our degraded infrastructure straitjackets growth. We resist borrowing, fearful of financing pork-barrel projects selected because of political calculations rather than need. While we have channeled capital into wars and debt, our competitors in Asia and Latin America have worked with infrastructure banks to lay a sound foundation for growth. As a result, we must compete not only with their lower labor costs but also with their advanced energy, transportation and information platforms, which are a magnet even for American businesses.

A recent survey by the Rockefeller Foundation found that Americans overwhelmingly supported greater private investment in infrastructure. Even so, there is understandable skepticism about public-private partnerships; Wall Street has not re-earned the trust of citizens who saw hard-earned dollars vacuumed out of their retirement accounts and homes. An infrastructure bank would not endanger taxpayer money, because under the Federal Credit Reform Act of 1990, passed after the savings and loan scandal, it would have to meet accounting and reporting requirements and limit government liability. The proposed authority would not and could not become a Fannie Mae or Freddie Mac. It would be owned by and operated for America, not shareholders.

The World Bank, the Inter-American Development Bank, the Asian Development Bank and similar institutions helped debt-burdened developing countries to grow through infrastructure investments and laid the foundations for the global high-tech economy. For instance, they literally laid the infrastructure of the Web through a fiber-optic link around the globe. Infrastructure banks retrofitted ports to receive and process shipping containers, which made it profitable to manufacture goods overseas. Similar investments anchored energy-intensive microchip fabrication...MORE



Michael B. Likosky, a senior fellow at the Institute for Public Knowledge, New York University, is the author of “Obama’s Bank: Financing a Durable New Deal.”

http://www.irishtimes.com/newspaper/finance/2011/0714/1224300712377.html

“INCOMPREHENSIBLE” WAS how the European Commission in Brussels described Moody’s downgrading of Ireland to junk status at market close on Tuesday. Unprintable descriptions of the move were uttered across Dublin.

As sure as night follows day, the junking caused a further sell-off of Irish Government debt across all maturities from the moment markets opened at 8.30am yesterday.

By 10am the yield on the benchmark 10-year bond had risen by 30 basis points (0.3 percentage points).

A plateau was reached before another 30-point rise took place in the last hour of trading – though the end-of-day move was more likely to do with euro zone-wide wobbles that saw all the weak peripherals lose ground.

http://www.npr.org/2011/07/13/137789065/why-prosecutors-dont-go-after-wall-street?ft=1&f=1001

When the energy giant Enron collapsed 10 years ago, top executives of the company faced criminal prosecution and many served lengthy prison terms. In the savings and loan scandal of the 1980s, hundreds of bankers went to jail. But the financial meltdown of 2008 hasn't generated a single prosecution of high-level Wall Street players — even though the Securities and Exchange Commission has brought civil cases against some companies and reached financial settlements...That's a result of new guidelines issued by the Justice Department in 2008, which have allowed prosecutors to take a "softer approach" to corporate crimes. The guidelines — known as deferred prosecution agreements — have permitted financial companies to avoid indictments if they agree to investigate and report their own crimes.

"It's a gentleman's agreement and it really allows companies to keep their share prices higher and it helps companies continue to do business with the government, but it's a lot lighter " says New York Times financial reporter Louise Story. "And this was celebrated on Wall Street."

-----------------------------EDIT------------------------------

Some civil cases have been filed by the SEC against some of the mortgage and financial companies which profited throughout the financial crisis, though very few of those cases have actually named individuals who work for the companies. "For instance, the settlement with Goldman Sachs that the SEC entered into last summer was a pretty large one — $550 million — and some people would say, 'That's a big punishment,'" says Story. "But then other people would say, 'But Goldman Sachs makes that in about three weeks of trading. And these penalties are ultimately paid for by Goldman's shareholders — not by the executives or the salespeople or the traders that actually individually played a role in what happened. The leaders of Goldman are still there and they're all still getting very large bonuses." Only one Goldman Sachs employee — a 28-year-old salesman named Fabrice Tourre — has been sued by the SEC for his role in a toxic mortgage-securities fraud case during the 2008 financial crisis. No criminal charges were filed. "We were told by a lot of current and former Goldman people that there were a large team of people involved and in fact, since then many Goldman employees and former employees have told us that they were so surprised that only Fabrice was named," says Story. "Fabrice himself thinks it was a little odd that he was the only one named. And we recently obtained the private reply that Fabrice sent to the SEC trying to convince them that he should not be the only one named. And in the reply, he laid out all kinds of people — six or seven other people — who were just as involved in all of the activities as he was."

Other SEC civil cases that have named individuals — as in the case of Countywide ex-CEO Angelo Mozilo, who allegedly profited from toxic mortgages while misleading investors about the risks and agreed to a $67.5 million settlement — have not resulted in criminal prosecutions.

*********************************************************************************

Louise Story joined The New York Times in 2006. She covers Wall Street and finance, and was a finalist for the 2009 Pulitzer Prize in Public Service.

http://www.npr.org/blogs/thetwo-way/2011/07/14/137840511/error-about-news-corp-was-big-screw-up-on-my-part-columnist-says?ft=1&f=1001

While he can explain how it happened, Reuters columnist David Cay Johnston says "there's no excuse" for the huge mistake he made Tuesday when he wrote that Rupert Murdoch's News Corp. had received billions of dollars in tax refunds from the U.S. government in recent years — when in fact it had paid billions of dollars in federal taxes.

"This is a big screw-up on my part," he told Morning Edition host Steve Inskeep earlier today. According to Johnston, "News Corp. reported numbers as positive numbers for cash paid for taxes for three years and then in 2007 switched to reporting them as negative numbers — that is, as numbers in parentheses. ... And I didn't catch that those were negative numbers." The company did disclose the accounting change it had made. Johnston said he does not recall if he read the note in its financial reports, and says that the way it was written would not have made him realize what News Corp. had done.

Before his original column was posted on Reuters.com, Johnston called News Corp. for comment on his (erroneous) conclusion that the company had gotten billions in refunds. Neither of the officials he spoke to, Johnston said today, "so much as coughed." And the company declined to comment for his original column...

"Rupert Murdoch's News Corp did not get a $4.8 billion tax refund for the past four years, as I reported. Instead, it paid that much in cash for corporate income taxes for the years 2007 through 2010 while earning pre-tax profits of $10.4 billion."

MORE AT LINK

MAKES ONE GO HMMM....IS IT A BAD THING, IF GOOD RESULTED?

Something definitely is puzzling. I really don't see how Johnston could make such a mistake, isn't that part of his job to know reports? Seems more likely to me, that News Corp had a creative way of hiding things, and someone in the news media got to Johnston to report his 'mistake'.

There have been too many conspiracy theories that have been revealed to be facts, too much fancy dancing around reality.

http://online.wsj.com/article/SB10001424052702304911104576445070496630838.html?KEYWORDS=sensex

MUMBAI—Indian shares overcame initial jitters a day after Wednesday's bomb blasts to inch higher, with interest rate-sensitive shares leading the advance after June's inflation reading came in below estimates.

The Bombay Stock Exchange's Sensitive Index rose 0.1% to 18618.20, after falling early to 18449.23. Three bombs exploded in Mumbai Wednesday evening, killing at least 18 people and injuring more than 130 in what Indian authorities suspect was a terrorist attack. Of the 30 Sensex constituents, 18 ended higher.

On the National Stock Exchange, the 50-stock S&P CNX Nifty gained 0.3% to end at 5,599.80.

Volume on the BSE rose to 27.75 billion rupees from Wednesday's 25.65 billion rupees. Advancers outnumbered decliners 1,590 to 1,219, with 156 stocks unchanged.

http://uk.reuters.com/article/2011/07/14/india-stocks-idUKL3E7IE1VC20110714

MUMBAI, July 14 (Reuters) - Indian shares rebounded from an
early slide on Thursday after a slower-than-expected rise in
inflation calmed nerves caused by weak global markets and bomb
blasts in Mumbai.

Financials led the gains with leading lenders State Bank of
India and ICICI Bank rallying 1.5 and 1.4
percent respectively on hopes the central bank may pause on its
tightening cycle in the coming months.

The 30-share BSE index closed up 0.12 percent, or
22.18 points, at 18,618.20, with 18 components advancing.

The wholesale price index , India's main
inflation gauge, rose an annual 9.44 percent in June, faster
than the previous month but below expectations of 9.7 percent,
driven by higher manufactured goods and fuel prices.

http://www.nytimes.com/2011/07/08/opinion/08krugman.html?_r=1&src=ISMR_HP_LO_MST_FB

Obviously, the details (DEBT LIMIT RAISING DEAL) matter a lot, but progressives, and Democrats in general, are understandably very worried. Should they be? In a word, yes. Now, this might just be theater: Mr. Obama may be pulling an anti-Corleone, making Republicans an offer they can’t accept. The reports say that the Obama plan also involves significant new revenues, a notion that remains anathema to the Republican base. So the goal may be to paint the G.O.P. into a corner, making Republicans look like intransigent extremists — which they are...But let’s be frank. It’s getting harder and harder to trust Mr. Obama’s motives in the budget fight, given the way his economic rhetoric has veered to the right. In fact, if all you did was listen to his speeches, you might conclude that he basically shares the G.O.P.’s diagnosis of what ails our economy and what should be done to fix it. And maybe that’s not a false impression; maybe it’s the simple truth.

One striking example of this rightward shift came in last weekend’s presidential address, in which Mr. Obama had this to say about the economics of the budget: “Government has to start living within its means, just like families do. We have to cut the spending we can’t afford so we can put the economy on sounder footing, and give our businesses the confidence they need to grow and create jobs.” That’s three of the right’s favorite economic fallacies in just two sentences. No, the government shouldn’t budget the way families do; on the contrary, trying to balance the budget in times of economic distress is a recipe for deepening the slump. Spending cuts right now wouldn’t “put the economy on sounder footing.” They would reduce growth and raise unemployment. And last but not least, businesses aren’t holding back because they lack confidence in government policies; they’re holding back because they don’t have enough customers — a problem that would be made worse, not better, by short-term spending cuts...

People have asked me why the president’s economic advisers aren’t telling him not to believe in the confidence fairy — that is, not to believe the assertion, popular on the right but overwhelmingly refuted by the evidence, that slashing spending in the face of a depressed economy will magically create jobs. My answer is, what economic advisers? Almost all the high-profile economists who joined the Obama administration early on have either left or are leaving. Nor have they been replaced. As The Wall Street Journal recently noted, there are a “stunning” number of vacancies in important economic posts. So who’s defining the administration’s economic views? (3 GUESSES...TIMMY, GOLDMAN SACHS, AND THE INVISIBLE ROBERT RUBIN)


Mr. Obama’s people will no doubt argue that their fellow party members should trust him, that whatever deal emerges was the best he could get. But it’s hard to see why a president who has gone out of his way to echo Republican rhetoric and endorse false conservative views deserves that kind of trust.

Couldn't have put it better myself.

http://www.truth-out.org/just-18000-new-jobs-june-leads-another-rise-unemployment/1310136941

Even if job growth were to improve through the rest of 2011, it would not be enough to reduce the unemployment rate...The Labor Department reported that the economy created just 18,000 jobs in June. It also revised down the previous two months' numbers, bringing the average rate of job growth over this period to 87,000 jobs a month. The slow job growth led to another rise in the unemployment rate, which edged up to 9.2 percent. The employment-to-population (EPOP) ratio fell to 58.2 percent, the low hit in December of 2009 and again in November in 2010. This means that the job growth thus far in the recovery has been just sufficient to keep pace with the growth of the labor force.

The decline in EPOPs hit most groups, but black women saw the sharpest falloff, with their EPOP declining by 0.9 percentage points to 52.8 percent, another new low for the downturn. The EPOP for black women is 7.8 percentage points below the pre-recession peak in 2007. The EPOP for blacks overall edged down by 0.1 percentage points to 51.1 percent, also a new low for the downturn. By education level, those with some college appear to be the big losers at the moment. Their unemployment rate rose by 0.4 percentage points to 8.4 percent, while their EPOP fell by 0.2 percentage points to 63.9 percent, the latter being a new low for the downturn. This may be the result of unemployed workers getting additional education and then still being unable to find work.

The median and average duration of unemployment both rose in June, with the latter reaching a record high of 39.9 weeks. This corresponded to an increase of 89,000 in the number of workers who had been unemployed for more than 26 weeks. While the share of the long-term unemployed fell slightly due to a jump in newly unemployed workers, it has been creeping up again in the last half year after declining in the fall of 2010. This should be a major policy concern since the long-term unemployed tend to have great difficulty finding new employment. What is most striking in the establishment survey is that there are no sectors showing robust growth. Government was the biggest loser, shedding 39,000 jobs in June. Local government education accounted for the largest portion of this decline, losing 12,600 jobs, although this may reflect seasonal factors. Since peaking in August of 2008, state and local governments have shed 577,000 jobs....Furthermore, there is no evidence in this report of any momentum for a turnaround. Jobs in employment services (temp help) fell by 9,500, the third consecutive decline. Average weekly hours edged down by 0.1 hour to 34.3. Hours in manufacturing fell by 0.3 hours. The average hourly wage fell slightly in June and has risen at just a 1.7 percent annual rate over the last three months. With wages not keeping pace with inflation and hours falling, workers’ purchasing power and consumption are likely to lag.

On the whole, this is one of the most negative employment reports since the recovery began. It indicates that the economy has made no progress whatsoever in re-employing the people who lost their jobs in the downturn. Even more discouraging is the fact that there is no reason to expect anything to change for the better any time soon. The pace of job loss in the public sector is likely to accelerate, with no evidence of an offsetting pickup in the private sector.

**********************************************************************

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, DC. He is frequently cited in economics reporting in major media outlets, including the New York Times, Washington Post, CNN, CNBC, and National Public Radio. He writes a weekly column for the Guardian Unlimited (UK), the Huffington Post, TruthOut, and his blog, Beat the Press, features commentary on economic reporting. His analyses have appeared in many major publications, including the Atlantic Monthly, the Washington Post, the London Financial Times, and the New York Daily News. He received his Ph.D in economics from the University of Michigan.

Dean has written several books, his latest being Taking Economics Seriously (MIT Press) which thinks through what we might gain if we took the ideological blinders off of basic economic principles, False Profits: Recovering from the Bubble Economy (PoliPoint Press, 2010) about what caused - and how to fix - the current economic crisis. In 2009, he wrote Plunder and Blunder: The Rise and Fall of the Bubble Economy (PoliPoint Press), which chronicled the growth and collapse of the stock and housing bubbles and explained how policy blunders and greed led to the catastrophic - but completely predictable - market meltdowns. He also wrote a chapter ("From Financial Crisis to Opportunity") in Thinking Big: Progressive Ideas for a New Era (Progressive Ideas Network, 2009). His previous books include The United States Since 1980 (Cambridge University Press, 2007); The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer (Center for Economic and Policy Research, 2006), and Social Security: The Phony Crisis (with Mark Weisbrot, University of Chicago Press, 1999). His book Getting Prices Right: The Debate Over the Consumer Price Index (editor, M.E. Sharpe, 1997) was a winner of a Choice Book Award as one of the outstanding academic books of the year.

Among his numerous articles are "The Benefits of a Financial Transactions Tax," Tax Notes 121, no. 4, 2008; "Are Protective Labor Market Institutions at the Root of Unemployment? A Critical Review of the Evidence," (with David R. Howell, Andrew Glyn, and John Schmitt), Capitalism and Society 2, no. 1, 2007; "Asset Returns and Economic Growth," (with Brad DeLong and Paul Krugman), Brookings Papers on Economic Activity, 2005; "Financing Drug Research: What Are the Issues," Center for Economic and Policy Research, 2004; "Medicare Choice Plus: The Solution to the Long-Term Deficit Problem," Center for Economic and Policy Research, 2004; The Benefits of Full Employment (with Jared Bernstein), Economic Policy Institute, 2004; "Professional Protectionists: The Gains From Free Trade in Highly Paid Professional Services," Center for Economic and Policy Research, 2003; and "The Run-Up in Home Prices: Is It Real or Is It Another Bubble," Center for Economic and Policy Research, 2002.

Dean previously worked as a senior economist at the Economic Policy Institute and an assistant professor at Bucknell University. He has also worked as a consultant for the World Bank, the Joint Economic Committee of the U.S. Congress, and the OECD's Trade Union Advisory Council. He was the author of the weekly online commentary on economic reporting, the Economic Reporting Review (ERR), from 1996 - 2006.

A FULL BIO, JUST IN CASE OBAMA THINKS HE MIGHT NEED A FULLY CREDENTIALED ADVISOR...

http://www.truth-out.org/default-downturn-then-recovery/1309982137


...I explained in a previous column that Argentina suffered terribly from 1998 through 2001, as it tried to be orthodox and do the right thing. After it defaulted at the end of 2001, it went through a brief severe downturn, but soon began a rapid recovery that continued for a long time, as the chart on this page shows. Surely the Argentine example suggests that default is a great idea; the case against Greek default must be that this country is different (which, to be fair, is arguable).




...Just a thought suggested by some economic discussions I’ve followed: many people seem to have a hard time accepting that there are intermediate positions — in particular that you can question free-market, hard-money dogma without being a wild man. To say that some inflation can sometimes be a good thing does not mean advocating hyperinflation; to call for deficit spending in slumps does not mean saying that debt and deficits never matter; and so on.

This inability to make distinctions has really been on display in response to my various comments about Argentina. My point is that you can’t use Argentina to make a case that default is always a disaster, since Argentina had a strong recovery after default. I would have thought that was a clear and simple point. But apparently many people believe I am claiming that:

1. Everything in Argentina is wonderful to this day.
   
2. Everything that presidents Nestor Kirchner and Cristina Fernández de Kirchner did was right.
   
3. Default was the sole cause of good news in Argentina.
   
4. Everyone should immediately default.

Um, no. None of those are claims that I made. I really do worry about the state of reading comprehension. Or maybe it’s just that extremists can’t grasp the notion of non-extreme positions held by other people.

****************************************************************************************************

Paul Krugman joined The New York Times in 1999 as a columnist on the Op-Ed page and continues as a professor of economics and international affairs at Princeton University. He was awarded the Nobel in economic science in 2008.

Mr Krugman is the author or editor of 20 books and more than 200 papers in professional journals and edited volumes, including "The Return of Depression Economics" (2008) and "The Conscience of a Liberal" (2007). Copyright 2011 The New York Times.

Both fraud, and political crimes.

http://uk.reuters.com/article/2011/07/14/markets-precious-idUKL6E7IE0FD20110714

LONDON July 14 (Reuters) - Gold prices hit record highs for a second day on Thursday after hints of further policy easing from the Federal Reserve and a Moody's warning the United States may lose its top-notch credit rating hurt the dollar and sparked buying of safe-haven assets.

The precious metal was also strengthened by concerns over euro zone debt levels, which have intensified over delays to policymakers' plans to discuss the crisis and after Greece's credit rating was downgraded by Fitch late on Wednesday.

Spot gold touched a record $1,592.90, and was up 0.7 percent at $1,592.39 an ounce at 0935 GMT. U.S. gold futures GCv1 for August delivery were up $7.90 an ounce at $1,593.40.

The precious metal has risen more than 6 percent so far this month and is on track for its ninth straight daily rise, its longest run of gains since October 2006.

Is that an address? :hide:

Watch for the CRIMEX to issue another margin increase on PM's in 5-4-3-

http://uk.reuters.com/article/2011/07/14/markets-stocks-us-europe-idUKL6E7IE0DU20110714

* U.S. stock index futures pointed to slight gains for equities on Thursday, with futures for the S&P 500 SPc1, Dow Jones futures DJc1 and Nasdaq futures NDc1 up 0.3 to 0.6 percent by 0905 GMT.

* After markets closed on Wednesday, ratings agency Moody's warned that the United States could lose its top credit rating if lawmakers fail to increase the country's borrowing limit, sending U.S. stock index futures sharply lower.

* Moody's said it would likely assign a negative outlook to the nation's gold-plated credit rating if a credible agreement with long-term deficit reduction measures was not achieved.

* U.S. President Barack Obama clashed with Republican lawmakers on Wednesday in a fierce White House meeting on deficit reduction that left a deal in question as the clock ticked toward a debt default.

http://www.marketwatch.com/story/the-next-worse-financial-crisis-2011-07-06

1. We are learning the wrong lessons from the last one.
2. No one has been punished.
3. The incentives remain crooked.
4. The referees are corrupt.
5. Stocks are skyrocketing again.
6. The derivatives time bomb is bigger than ever — and ticking away.
7. The ancient regime is in the saddle.
8. Ben Bernanke doesn’t understand his job.
9. We are levering up like crazy.
10. The real economy remains in the tank.

You know what George Santayana said about people who forget the past. But we’re even dumber than that. We are doomed to repeat the past not because we have forgotten it but because we never learned the lessons to begin with.

MUCH EXPLICATION AT LINK--TODAY'S MUST READ!

*********************************************************

Brett Arends is a senior columnist for MarketWatch and a personal-finance columnist for the Wall Street Journal.

http://www.truth-out.org/news-thom-hartmann-banksters-laying-groundwork-second-financial-crisis-and-more/1310572861

In today's On the News segment: Moody's threatens US credit rating if deal on debt ceiling is not met by August 2, banksters laying the groundwork for a second financial crisis, United Nations accuses United States of breaking international torture law, fake Democrats in Wisconsin all lose, Southern Poverty Law Center names Rand Paul America's most extreme senator, Jay Rockefeller calls for an investigation into Murdoch, and more. watch the newscast.

http://www.youtube.com/watch?v=RelVBnvJCqg&feature=player_embedded

http://www.truth-out.org/ideological-crisis-western-capitalism/1310127895

THE CRISIS WAS CAUSED BY PERVERTING CAPITALISM TO SERVE AN IDEOLOGY THAT DOESN'T SUPPORT DEMOCRACY OR THE WEST OR PEOPLE...DEMETER

Just a few years ago, a powerful ideology – the belief in free and unfettered markets – brought the world to the brink of ruin. Even in its hey-day, from the early 1980’s until 2007, American-style deregulated capitalism brought greater material well-being only to the very richest in the richest country of the world. Indeed, over the course of this ideology’s 30-year ascendance, most Americans saw their incomes decline or stagnate year after year.

Moreover, output growth in the United States was not economically sustainable. With so much of US national income going to so few, growth could continue only through consumption financed by a mounting pile of debt.

I was among those who hoped that, somehow, the financial crisis would teach Americans (and others) a lesson about the need for greater equality, stronger regulation, and a better balance between the market and government. Alas, that has not been the case. On the contrary, a resurgence of right-wing economics, driven, as always, by ideology and special interests, once again threatens the global economy – or at least the economies of Europe and America, where these ideas continue to flourish.

In the US, this right-wing resurgence, whose adherents evidently seek to repeal the basic laws of math and economics, is threatening to force a default on the national debt. If Congress mandates expenditures that exceed revenues, there will be a deficit, and that deficit has to be financed. Rather than carefully balancing the benefits of each government expenditure program with the costs of raising taxes to finance those benefits, the right seeks to use a sledgehammer – not allowing the national debt to increase forces expenditures to be limited to taxes....MORE...Do we really need another costly experiment with ideas that have failed repeatedly? We shouldn’t, but increasingly it appears that we will have to endure another one nonetheless. A failure of either Europe or the US to return to robust growth would be bad for the global economy. A failure in both would be disastrous – even if the major emerging-market countries have attained self-sustaining growth. Unfortunately, unless wiser heads prevail, that is the way the world is heading.


********************************************************************

Joseph E. Stiglitz is University Professor at Columbia University, a Nobel laureate in Economics, and the author of Freefall: Free Markets and the Sinking of the Global Economy.

http://www.truth-out.org/qe2-shocker-whole-600-billion-wound-offshore/1310145225

On June 30, QE2 ended with a whimper. The Fed's second round of "quantitative easing" involved $600 billion created with a computer keystroke for the purchase of long-term government bonds. But the government never actually got the money, which went straight into the reserve accounts of banks, where it still sits today. Worse, it went into the reserve accounts of FOREIGN banks, on which the Federal Reserve is now paying 0.25 percent interest.

Before QE2 there was QE1, in which the Fed bought $1.25 trillion in mortgage-backed securities from the banks. This money, too, remains in bank reserve accounts collecting interest and dust. The Fed reports that the accumulated excess reserves of depository institutions now total nearly $1.6 trillion.

Interestingly, $1.6 trillion is also the size of the federal deficit - a deficit so large that some members of Congress are threatening to force a default on the national debt if it isn't corrected soon.

So, here we have the anomalous situation of a $1.6 trillion hole in the federal budget, and $1.6 trillion created by the Fed that is now sitting idle in bank reserve accounts. If the intent of "quantitative easing" was to stimulate the economy, it might have worked better if the money earmarked for the purchase of Treasuries had been delivered directly to the Treasury. That was actually how it was done before 1935, when the law was changed to require private bond dealers to be cut into the deal.

The one thing QE2 did for the taxpayers was to reduce the interest tab on the federal debt. The long-term bonds the Fed bought on the open market are now effectively interest free to the government, since the Fed rebates its profits to the Treasury after deducting its costs.

But QE2 has not helped the anemic local credit market, on which smaller businesses rely; and it is these businesses that are largely responsible for creating new jobs. In a June 30 article in The Wall Street Journal titled "Smaller Businesses Seeking Loans Still Come Up Empty," Emily Maltby reported that business owners rank access to capital as the most important issue facing them today; and only 17 percent of smaller businesses said they were able to land needed bank financing.

How QE2 Wound Up in Foreign Banks

Before the Banking Act of 1935, the government was able to borrow directly from its own central bank. Other countries followed that policy as well, including Canada, Australia and New Zealand; and they prospered as a result. After 1935, however, if the US central bank wanted to buy government securities, it had to purchase them from private banks on the "open market." Former Fed Chairman Marinner Eccles wrote in support of an act to remove that requirement, that it was intended to keep politicians from spending too much. But all the law succeeded in doing was to give the bond-dealer banks a cut as middlemen.

Worse, it caused the Fed to lose control of where the money went. Rather than buying more bonds from the Treasury, the banks that got the cash could just sit on it or use it for their own purposes; and that is apparently what is happening today.

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In carrying out its QE2 purchases, the Fed had to follow standard operating procedure for "open market operations": it took secret bids from the 20 "primary dealers" authorized to sell securities to the Fed and accepted the best offers. The problem was that 12 of these dealers - or over half - are US-based branches of foreign banks (including BNP Paribas, Barclays, Credit Suisse, Deutsche Bank, HSBC, UBS, and others); and they evidently won the bids.

The fact that foreign banks got the money was established in a June 12 post on Zero Hedge by Tyler Durden (a pseudonym), who compared two charts: the total cash holdings of foreign-related banks in the US, using weekly Federal Reserve data; and the total reserve balances held at Federal Reserve banks from the Fed's statement ending the week of June 1. The charts showed that after November 3, 2010, when QE2 operations began, total bank reserves increased by $610 billion. Foreign bank cash reserves increased in lock step, by $630 billion - or more than the entire QE2.

In a June 27 blog, John Mason, professor of finance at Penn State University and a former senior economist at the Federal Reserve, wrote:

In essence, it appears as if much of the monetary stimulus generated by the Federal Reserve System went into the Eurodollar market. This is all part of the "Carry Trade" as foreign branches of an American bank could borrow dollars from the "home" bank creating a Eurodollar deposit....

Cash assets at the smaller banks remained relatively flat.... Thus, the reserves the Fed was pumping into the banking system were not going into the smaller banks.... usiness loans continue to "tank" at the smaller banking institutions....

The real lending by commercial banks is not taking place in the United States. The lending is taking place off-shore, underwritten by the Federal Reserve System and this is doing little or nothing to help the American economy grow.

Durden concluded:

... he only beneficiary of the reserves generated were US-based branches of foreign banks (which in turn turned around and funnelled the cash back to their domestic branches), a shocking finding which explains ... why US banks have been unwilling and, far more importantly, unable to lend out these reserves ....

... he data above proves beyond a reasonable doubt why there has been no excess lending by US banks to US borrowers: none of the cash ever even made it to US banks!... This also resolves the mystery of the broken money multiplier and why the velocity of money has imploded.

Well, not exactly. The fact that the QE2 money all wound up in foreign banks is a shocking finding, but it doesn't seem to be the reason banks aren't lending. There were already $1 trillion in excess reserves sitting idle in US reserve accounts, not counting the $600 billion from QE2.

According to Scott Fullwiler, associate professor of economics at Wartburg College, the money multiplier model is not just broken, but is obsolete. Banks do not lend based on what they have in reserve. They can borrow reserves as needed after making loans. Whether banks will lend depends rather on (a) whether they have creditworthy borrowers, (b) whether they have sufficient capital to satisfy the capital requirement, and (c) the cost of funds - meaning the cost to the bank of borrowing to meet the reserve requirement, either from depositors or from other banks or from the Federal Reserve.

Setting Things Right

Whatever is responsible for causing the local credit crunch, trillions of dollars thrown at Wall Street by Congress and the Fed haven't fixed the problem. It may be time for local governments to take matters into their own hands. While we wait for federal lawmakers to get it right, local credit markets can be revitalized by establishing state-owned banks, on the model of the Bank of North Dakota (BND). The BND services the liquidity needs of local banks and keeps credit flowing in the state. For more information, see here and here.

Concerning the gaping federal deficit, Congressman Ron Paul has an excellent idea: have the Fed simply write off the federal securities purchased with funds created in its quantitative easing programs. No creditors would be harmed, since the money was generated out of thin air with a computer keystroke in the first place. The government would just be canceling a debt to itself and saving the interest.

As for "quantitative easing," if the intent is to stimulate the economy, the money needs to go directly into the purchase of goods and services, stimulating "demand." If it goes onto the balance sheets of banks, it may stop there or go into speculation rather than local lending - as is happening now. Money that goes directly to the government, on the other hand, will be spent on goods and services in the real economy, creating much-needed jobs, generating demand and rebuilding the tax base. To make sure the money gets there, the 1935 law forbidding the Fed to buy Treasuries directly from the Treasury needs to be repealed.
Creative Commons License

This work by Truthout is licensed under a Creative Commons Attribution-Noncommercial 3.0 United States License.

http://www.truth-out.org/greed-glance/1310394081

The Rockefellers, ever since the days of old John D., have enjoyed the great outdoors. They also seem to have figured out how to make that great outdoors pay. Over the past decade, new Environmental Working Group data show, Manhattan mega millionaire and John D. great-grandson Mark Rockefeller has pocketed nearly $330,000 in federal subsidies for not farming an Idaho property billed as "one of the world's premier fly-fishing retreats." That's much more than half the $500,000 in federal funding that food banks in North Idaho may shortly lose to federal budget cuts. Why aren't taxpayer groups that claim to worry about waste, Idaho social worker leader Delmar Stone wondered last week, "investigating the obscene loopholes and taxpayer giveaways to the super-rich?"

No one knows right now if James Palmer, the chief financial officer at defense contractor Northrop Grumman, is collecting any tax dollars for not farming fly-fishing retreats. But we do know, thanks to eagle-eyed researchers at footnoted.com, that Palmer is pocketing $750,000 in cash from Northrop Grumman to offset the cost of his upcoming personal move from Los Angeles to Northern Virginia. Northrop Grumman is shifting its entire corporate headquarters this summer to the burbs of Washington, DC, to get closer to the company's biggest customer, the Pentagon. Courtesy of that Pentagon — and US taxpayers — Palmer last year took home $11.4 million, over double the median pay in 2010 for Fortune 500 CFOs. To help foot the bill for his moving expenses, Northrop Grumman is lopping 60 jobs off its 360-employee headquarters staff . . .

Has Polo Ralph Lauren, the pretentiously casual clothing company, suddenly seen the light on CEO pay? That may seem the case — at first glance. The firm has slashed its perks outlay for CEO Ralph Lauren by a hefty $344,000. From now on, the company disclosed last month, chief exec Lauren will get no more than $200,000 a year in free personal travel on the firm's private jet. But Lauren may not notice the cutback. The company has actually increased his overall pay, by over $2 million, to $29.7 million. Also in line for hefty fiscal 2011 paychecks: Ralph’s brother Jerome, the firm's exec vp for menswear design, at $2.6 million and Ralph's son David, the firm’s exec vp for global advertising, at $1.6 million. Why be so generous to Jerome and David? The Polo Ralph Lauren board probably wants to make sure the pair don’t jump at some rival's better offer . . .

Move over, Elizabeth Warren. America may have another champion of average families — and critic of concentrated wealth — in Washington's highest financial policy circles. Sarah Bloom Raskin, a governor on the Federal Reserve Board only since last October, last week let rip with the strongest attack on inequality out of an American central banker in years. The "rapid growth in income and assets for those in the top 1 percent," Raskin told a DC forum, "undermines the ability of the economy to grow sustainably and efficiently." Growing inequality, she added, brings "increases in crime, profound strains on households, lower savings rates, poorer health outcomes, and diminished levels of trust in people and institutions." Raskin, 50, served as Maryland's top financial regulator before gaining her Fed seat . . .

if you can ignore the screaming of pricked egos and emptied hoards.

I am so with you on this:
"I have no hope. I see no future."

So Frikkin' Doomed!

7/14/11 Karl Denninger: Here It Comes

This is not about the "ceiling." It is about fiscal sustainability. Here is the text of the salient section from S&P as reported by Reuters:

-- We may lower the long-term rating on the U.S. by one or more notches into the 'AA' category in the next three months, if we conclude that Congress and the Administration have not achieved a credible solution to the rising U.S. government debt burden and are not likely to achieve one in the foreseeable future.

more...
http://market-ticker.org/akcs-www?post=190036

WASHINGTON — Credit rating agency Standard & Poor's said Thursday that there is a 50 percent chance it will downgrade the U.S. government's credit rating within three months because of the congressional impasse over approving an increase in the debt ceiling.

http://www.usatoday.com/money/economy/2011-07-14-standard-and-poors-possible-downgrade_n.htm

http://www.truth-out.org/budget-blowhards-why-budget-debate-destined-become-ever-more-painful/1310390500

...The Washington press corps is living some bizarre delusion about the balanced budgets at the end of the Clinton years. They didn't come about from politicians making tough choices. They came about from much stronger than expected economic growth and the willingness of Alan Greenspan to ignore the economic orthodoxy and not shut down the expansion. (IN OTHER WORDS, BUBBLE-BLOWING REIGNED. FURTHERMORE, WE KNOW NOW THAT IT WAS A BUBBLE BASED ON FRAUD--DEMETER)

This can be easily seen by just looking at the projections from the Congressional Budget Office (CBO). In 1996, the CBO projected that the year 2000 budget deficit would be $244 billion (2.7 percent of GDP). Instead, the economy ran a surplus of $232 billion, or roughly 2.4 percent of GDP. This involves a shift from deficit to surplus of $476 billion or 5.1 percentage points of GDP. This would be equivalent to reducing the annual deficit by $750 billion in 2011.

While Kasich and NPR tell this shift from deficit to surplus as being the result of politicians making the tough choices to cut spending and raise taxes, this is simply not true. According to the CBO, the net contribution to deficit reduction of Mr. Kasich's courage was minus $10 billion. In other words, the sum of the impact of legislated spending cuts and tax increases to the budget over this four-year period was to add $10 billion to the deficit.

The main reason that the budget went from deficit to surplus was that the economy grew much faster than expected and unemployment fell much lower than the consensus in the economics profession said was possible. In 1996, the CBO projected that the unemployment rate would be 6 percent in 2000. It was actually 4 percent.

This happened in large part because Greenspan ignored the economic orthodoxy and allowed the economy to keep growing even after the unemployment rate fell below the 6 percent threshold that most mainstream economists viewed as a lower floor. They expected inflation to take off if the unemployment rate fell to 5 percent, and certainly to get out of control at 4 percent.

Greenspan ignored the orthodoxy and overrode the objections of the leading economists at the Fed, who were Clinton appointees. Had the Clinton appointees gotten their way and the Fed adhered to economic orthodoxy, then the budget never would have shifted into surplus. This is all easy to see with a quick look at the CBO publications.

I promised that budget blowhard mocking would be bipartisan, so let's also take a moment to ridicule President Clinton. Clinton gave an interview with the National Journal last week which was titled, "A lost decade: Bill Clinton reflects on the reasons for the economy's struggles since he left office 10 years ago."

The piece has Clinton telling us how they did things right in the '90s with the idea that this will be a recipe for future prosperity. Incredibly, the piece never mentions the stock bubble that was the economy's main driver at the end of the '90s. The collapse of this bubble, at the time the largest asset bubble in the history of the world, gave us the 2001 recession and the longest period without job growth since the Great Depression (until now).

The piece also doesn't mention Clinton's high-dollar policy. The overvalued dollar made US goods uncompetitive in world markets and led to a soaring trade deficit by the end of the Clinton years. The massive trade deficit and the imbalances it implied created the basis for the housing bubble.

If we had reality-based politics, Clinton would be hiding under a rock, not lecturing us about the route to economic prosperity. In fact, Clinton even had the gall to tell us how to create manufacturing jobs through trade, apparently overlooking the fact that the economy lost manufacturing jobs each of his last three years in office.

The facts are fairly simple here and they are 180 degrees at odds with the stories on the budget and the economy in the major news outlets. But the budget blowhards have the money and the power, so we will be hearing much more from them. We can at least enjoy playing the ridicule game.

**************************************************************************************

This work by Truthout is licensed under a Creative Commons Attribution-Noncommercial 3.0 United States License.

Dean Baker is a macroeconomist and co-director of the Center for Economic and Policy Research in Washington, DC. He previously worked as a senior economist at the Economic Policy Institute and an assistant professor at Bucknell University. He is a regular Truthout columnist and a member of Truthout's Board of Advisers.

http://www.truth-out.org/learning-hard-way/1310483585

Harry Markopolos is an American hero for trying to warn the Security and Exchange Commission (SEC) about the infamous Bernie Madoff, who, for years, pulled off the largest Ponzi investment scheme in history. In 1999, while an investment officer for an investment firm in Boston, Markopolos was
asked by his boss to find out why Madoff's wealth management company consistently did better than other financial firms. After about four hours of investigating and running Madoff's numbers, he realized that Madoff could not legitimately have made that high a return for his investors. However, with the help of three other coworkers, he spent the next nine years peeling back the layers on Madoff's scheme and trying to get the SEC to investigate.

While he did find a sympathetic ear from a few SEC investigators during that period, the agency on the whole ignored him and ducked his calls and emails. Undaunted, he kept investigating and finding more information showing that the Madoff fund was just a large Ponzi scheme only to have the SEC continue to ignore his information. In April of 2008, he filed his last report to them and had decided to give up trying to get the government to do the right thing. It was only because of the stock market crash that fall that caused Madoff to turn himself in, after defrauding $18 billion of his customers' money.

After the dust settled on the Madoff's case and he was sentenced to life in prison, Markopolos testified to Congress and wrote a book on his unsuccessful disclosures to the SEC. After trying for nine years to get the SEC to do their job, he had unique knowledge on what was wrong with the SEC in routing out fraud. He made hard-hitting suggestions on how to reform the SEC or abolish it and set up a new agency to oversee all corporate and financial markets. Here are the some of the suggestions from his February 4, 2009, testimony to Congress and his book, "No One Would Listen: A True Financial Thriller," on what to do to make sure that the Madoff nightmare never happens again or persists for nine years.

From his testimony:



Markopolos also suggested that a new and improved whistleblower bounty program be instituted so that whistleblowers have a place to bring their knowledge of fraud. That program has been set up as explained in two past Solutions columns. Here and here.

If the SEC is unable to be reformed because of entrenched bureaucratic ways, Markopolos suggests that it be abolished and a new overarching agency be created to oversee all financial markets. He outlines what this agency should look like in his 2010 book, "No One Would Listen: A True Financial Thriller":



So far, Markopolos has not been too impressed with current SEC Chair Mary Shapiro, who was appointed to clean up the SEC in the wake of the Madoff fraud. Markopolos is a tough and persistent fraud investigator with a hard edge. I would suggest another reform for the SEC would be for Chairwoman Shapiro to hire Markopolos as a special assistant with the sole charge of making the necessary investigative reforms to the SEC. He has exactly the type of knowledge of the industry and of the failures of the SEC along with the edginess to truly make it happen if she is serious about reform.

At the very least, Markopolos' brave whistleblowing may inspire other whistleblowers to go through the new SEC whistleblower program and continue to expose fraud at a much higher level than the SEC internal fraud investigators. Markopolos has set the standard of how you can, with an understanding of the industry, unearth and expose the fraud that has robbed so many Americans.

*****************************************************************

This work by Truthout is licensed under a Creative Commons Attribution-Noncommercial 3.0 United States License.


Dina Rasor is an investigator, journalist and author. Rasor has been fighting waste while working for transparency and accountability in government for three decades. In 1981 Rasor founded the Project on Military Procurement (now called the Project on Government Oversight, or POGO) to serve as a non-profit, non-partisan watchdog over military and related government spending. Rasor's most recent book, "Betraying Our Troops: The Destructive Results of Privatizing War," chronicles first-hand accounts of the devastating consequences of privatized war support for troops and the overall war effort in Iraq. She also founded the Bauman & Rasor Group that helps whistleblowers file lawsuits under the Federal qui tam False Claims act and has been involved in cases which have returned over $100 million back to the U.S. Treasury.

gotta get the day on the road...or something like that.

Besides, I've had enough Reality for one morning, and there's pie downstairs!

Take care of yourselves!

As the debt negotiators square off in Congress, much attention will focus on the size of the 10-year deal they come up with. As almost everyone agrees, there is much more risk of doing too little than too much given the scale of America’s fiscal challenge.

Read more >>
http://link.ft.com/r/3JFELL/ZGG25D/T10SH/8A0Q2S/C4M8AZ/36/t?a1=2011&a2=7&a3=12


Jason Nesmith: Well, let me tell you something, Sarris: It doesn't take a great actor to recognize a bad one. You're sweating. ---Galaxy Quest

WHAT'S GOING DOWN, LARRY? ALL YOUR LITTLE SCHEMES GOING TO SMASH?

(OVER the old debt limit of 14.294-trillion dollars by 49-billion dollars. Good day.)
Back to a big boy, hopefully without becoming one.
(Debt under Obama seems to jump up big then drop slowly maybe up a little and down a little for days--repeat.)
= Held by the Public + Intragovernmental(FICA)
= 9,741,328,212,172.62 + 4,601,637,637,955.58
DOWN 3,634,448,925.47 + UP 3,623,233,160.94

Source: Debt to the penny:
http://www.treasurydirect.gov/NP/BPDLogin?application=np

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 312-Million person America.
If every American, man, woman and child puts in $3.20 THAT'S 1B$, and $3,200.71 makes 1T$.
A family of three: Mom, Dad, Child: $9.60, ABOUT TEN BUCKS for a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is the federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)

PERSONALIZED DEBT:
Every 12 seconds we net gain another American, so at the end of the workday of the report, there should be 312,430,592 people in America.
http://www.census.gov/population/www/popclockus.html ON 10/04/2010 04:37 -> 310,403,677
Currently, each of these Americans owe $45,907.69.
A family of three owes $137,723.06. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 20 reports in the last 30 to 32 days.
The average for the last 20 reports is -83,019,100.04.
The average for the last 30 days would be -55,346,066.69.
The average for the last 32 days would be -51,886,937.52.
There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 174 reports in 253 days of Obama's part of FY2009 averaging 7.33B$ per report, 5.07B$/day so far.
There were 249 reports in 365 days of FY2009 averaging 7.57B$ per report, 5.16B$/day.
There were 251 reports in 365 days of FY2010 averaging 6.58B$ per report, 4.53B$/day.
There were 192 reports in 285 days of FY2011 averaging 4.07B$ per report, 2.74B$/day.
Above line should be okay

PROJECTION:
There are 558 days remaining in this Obama 1st term.
By that time the debt could be between 14.3 and 17.2T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
07/12/2011 14,342,965,850,128.20 BHO (UP 3,716,088,801,215.12 so far since Obama took office.)

FISCAL YEAR DEBT CHANGE, Sep 30 prior year to Sep 30 named year:
(One "* " for each 40B$ reached)
FY1994 +0,281,261,026,873.94 ------------* * * * * * * WJC
FY1995 +0,281,232,990,696.07 ------------* * * * * * * WJC
FY1996 +0,250,828,038,426.34 ------------* * * * * * WJC
FY1997 +0,188,335,072,261.61 ------------* * * * WJC
FY1998 +0,113,046,997,500.28 ------------* * WJC
FY1999 +0,130,077,892,735.81 ------------* * * WJC
FY2000 +0,017,907,308,253.43 ------------WJC
FY2001 +0,133,285,202,313.20 ------------* * * C&B
01-WJC +0,053,598,528,417.78 ------------* WJC 31% of FY, 40% of FY-Debt
01-GWB +0,079,686,673,895.42 ------------* GWB 69% of FY, 60% of FY-Debt
FY2002 +0,420,772,553,397.10 ------------* * * * * * * * * * GWB
FY2003 +0,554,995,097,146.46 ------------* * * * * * * * * * * * * GWB
FY2004 +0,595,821,633,586.70 ------------* * * * * * * * * * * * * * GWB
FY2005 +0,553,656,965,393.18 ------------* * * * * * * * * * * * * GWB
FY2006 +0,574,264,237,491.73 ------------* * * * * * * * * * * * * * GWB
FY2007 +0,500,679,473,047.25 ------------* * * * * * * * * * * * GWB
FY2008 +1,017,071,524,649.92 ------------* * * * * * * * * * * * * * * * * * * * * * * * * GWB
FY2009 +1,885,104,106,599.30 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * B&O
09GWB +0,602,152,152,000.60 ------------* * * * * * * * * * * * * * * GWB 31% of FY, 32% of FY-Debt
09-BHO +1,282,951,954,598.70 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO 69% of FY, 68% of FY-Debt
FY2010 +1,651,794,027,380.00 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO
FY2011 +0,781,342,819,236.50 ------------* * * * * * * * * * * * * * * * * * * BHO
Endof11 +1,000,667,119,373.06 ------------* * * * * * * * * * * * * * * * * * * * * * * * * BHO

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
06/17/2011 -003,280,766,773.26 --
06/20/2011 -001,398,167,502.39 -- Mon
06/21/2011 -005,323,373,908.56 --
06/22/2011 +008,838,427,845.80 ------------*********
06/23/2011 -003,583,724,883.29 --
06/24/2011 +001,084,698,810.36 ------------*********
06/27/2011 -002,470,523,317.36 -- Mon
06/28/2011 -005,425,153,798.63 --
06/29/2011 +007,017,747,779.06 ------------*********
06/30/2011 +003,977,538,029.63 ------------*********
07/06/2011 +006,618,560,773.63 ------------********* Wed
07/07/2011 +001,077,509,146.64 ------------*********
07/08/2011 -000,834,469,945.40 ---
07/11/2011 -004,122,303,723.36 -- Mon
07/12/2011 -003,634,448,925.47 --

-1,458,450,392.60 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008 while Bush was in power JUST BEFORE fiscal year end.
Bush admin borrowed $962,245,245,654.01 in those last 124 days in office crossing two fiscal years.
$360,093,093,653.42 in last 12 days of FY2008, and $602,152,152,000.59 in subsequent 112 days before leaving office.

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock
http://www.usdebtclock.org/
DUer primer on National debt

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=4917842&mesg_id=4917991

(OVER the old debt limit of 14.294-trillion dollars by 49-billion dollars. Good day.)
Late night with much to do.
(Debt under Obama seems to jump up big then drop slowly maybe up a little and down a little for days--repeat.)
= Held by the Public + Intragovernmental(FICA)
= 9,752,020,265,772.31 + 4,590,934,368,144.10
UP 10,692,053,599.69 + DOWN 10,703,269,811.48

Source: Debt to the penny:
http://www.treasurydirect.gov/NP/BPDLogin?application=np

THINKING IN BILLIONS: Think 3 or 4 dollars per billion in a 312-Million person America.
If every American, man, woman and child puts in $3.20 THAT'S 1B$, and $3,200.64 makes 1T$.
A family of three: Mom, Dad, Child: $9.60, ABOUT TEN BUCKS for a 1B$ federal program.
I hope that is clear. However, I'd suggest using $3 per 1B$ to underestimate it.
Use $4 per 1B$ to overestimate the cost when thinking: Is the federal program worth it?
Aid to Dependant Children: 2B$/yr =$8/yr(a movie a year) Family of 3: $24/yr(an hour of bowling)

PERSONALIZED DEBT:
Every 12 seconds we net gain another American, so at the end of the workday of the report, there should be 312,437,792 people in America.
http://www.census.gov/population/www/popclockus.html ON 10/04/2010 04:37 -> 310,403,677
Currently, each of these Americans owe $45,906.59.
A family of three owes $137,719.78. (And that is IN ADDITION to their mortgage.)

ANALYSIS:
There were 20 reports in the last 30 days.
The average for the last 20 reports is -81,792,113.80.
The average for the last 30 days would be -54,528,075.86.

There were 252 reports in 365 days of FY2007 averaging 1.99B$ per report, 1.37B$/day.
There were 253 reports in 366 days of FY2008 averaging 4.02B$ per report, 2.78B$/day.
There were 75 reports in 112 days of GWB's part of FY2009 averaging 8.03B$ per report, 5.38B$/day.
There were 174 reports in 253 days of Obama's part of FY2009 averaging 7.33B$ per report, 5.07B$/day so far.
There were 249 reports in 365 days of FY2009 averaging 7.57B$ per report, 5.16B$/day.
There were 251 reports in 365 days of FY2010 averaging 6.58B$ per report, 4.53B$/day.
There were 193 reports in 286 days of FY2011 averaging 4.05B$ per report, 2.73B$/day.
Above line should be okay

PROJECTION:
There are 557 days remaining in this Obama 1st term.
By that time the debt could be between 14.3 and 17.2T$.
It could be higher. It could be lower.

HISTORICAL:
President's term begins and ends on Jan 20.
(Guess who might want to hide the Reagan Bush years. Jan 20 data is missing before 1993.)
01/20/1993 _4,188,092,107,183.60 WJC Inaugural
01/22/2001 _5,728,195,796,181.57 WJC (UP 1,540,103,688,997.97)
01/20/2009 10,626,877,048,913.08 GWB (UP 4,898,681,252,731.43)
07/13/2011 14,342,954,633,916.41 BHO (UP 3,716,077,585,003.33 so far since Obama took office.)

FISCAL YEAR DEBT CHANGE, Sep 30 prior year to Sep 30 named year:
(One "* " for each 40B$ reached)
FY1994 +0,281,261,026,873.94 ------------* * * * * * * WJC
FY1995 +0,281,232,990,696.07 ------------* * * * * * * WJC
FY1996 +0,250,828,038,426.34 ------------* * * * * * WJC
FY1997 +0,188,335,072,261.61 ------------* * * * WJC
FY1998 +0,113,046,997,500.28 ------------* * WJC
FY1999 +0,130,077,892,735.81 ------------* * * WJC
FY2000 +0,017,907,308,253.43 ------------WJC
FY2001 +0,133,285,202,313.20 ------------* * * C&B
01-WJC +0,053,598,528,417.78 ------------* WJC 31% of FY, 40% of FY-Debt
01-GWB +0,079,686,673,895.42 ------------* GWB 69% of FY, 60% of FY-Debt
FY2002 +0,420,772,553,397.10 ------------* * * * * * * * * * GWB
FY2003 +0,554,995,097,146.46 ------------* * * * * * * * * * * * * GWB
FY2004 +0,595,821,633,586.70 ------------* * * * * * * * * * * * * * GWB
FY2005 +0,553,656,965,393.18 ------------* * * * * * * * * * * * * GWB
FY2006 +0,574,264,237,491.73 ------------* * * * * * * * * * * * * * GWB
FY2007 +0,500,679,473,047.25 ------------* * * * * * * * * * * * GWB
FY2008 +1,017,071,524,649.92 ------------* * * * * * * * * * * * * * * * * * * * * * * * * GWB
FY2009 +1,885,104,106,599.30 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * B&O
09GWB +0,602,152,152,000.60 ------------* * * * * * * * * * * * * * * GWB 31% of FY, 32% of FY-Debt
09-BHO +1,282,951,954,598.70 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO 69% of FY, 68% of FY-Debt
FY2010 +1,651,794,027,380.00 ------------* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * BHO
FY2011 +0,781,331,603,024.70 ------------* * * * * * * * * * * * * * * * * * * BHO
Endof11 +0,997,153,968,895.16 ------------* * * * * * * * * * * * * * * * * * * * * * * * BHO

LAST FIFTEEN REPORTS OF ADDITIONS TO PUBLIC DEBT(NOT FICA):
06/20/2011 -001,398,167,502.39 -- Mon
06/21/2011 -005,323,373,908.56 --
06/22/2011 +008,838,427,845.80 ------------*********
06/23/2011 -003,583,724,883.29 --
06/24/2011 +001,084,698,810.36 ------------*********
06/27/2011 -002,470,523,317.36 -- Mon
06/28/2011 -005,425,153,798.63 --
06/29/2011 +007,017,747,779.06 ------------*********
06/30/2011 +003,977,538,029.63 ------------*********
07/06/2011 +006,618,560,773.63 ------------********* Wed
07/07/2011 +001,077,509,146.64 ------------*********
07/08/2011 -000,834,469,945.40 ---
07/11/2011 -004,122,303,723.36 -- Mon
07/12/2011 -003,634,448,925.47 --
07/13/2011 +010,692,053,599.69 ------------**********

12,514,369,980.35 Total of 15 above reports.

Heavy borrowing seems to start after 09/18/2008 while Bush was in power JUST BEFORE fiscal year end.
Bush admin borrowed $962,245,245,654.01 in those last 124 days in office crossing two fiscal years.
$360,093,093,653.42 in last 12 days of FY2008, and $602,152,152,000.59 in subsequent 112 days before leaving office.

For a prettier and more explanatory view of our nation's debt:
http://www.brillig.com/debt_clock
http://www.usdebtclock.org/
DUer primer on National debt

(Debt to the penny keeps changing. Stuff is missing. Best to keep our own history.) LAST REPORT:
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=4919709&mesg_id=4920123