yea

General interest in the Great Recession is fading. “Recession” as a search term broke the previous trendline in around March, 2009. Likewise, Quantcast reports that traffic peaked at RGEMonitor.com (Nouriel Roubini) in Oct and CalculatedRisk in March. The “double-peak pattern” is similar to the 2001 recession, with approximately a year between peaks. I suspect this is an indicator of initial awareness (first peak) followed by a more in-depth discussion (second peak).http://www.realmeme.com/roller/page/realmeme?entry=2009_recession_revisited.

oh ye of so little faith…with so little volume in the US stock market, TPTB will gently nudge it higher and higher

all I know is that it is a depression for me

Yeah, it’s only a recession when it happens to other people…SWK

getting cold in my shorts…

california’s IOUs is worthless as california’s junk rating. IOUs at 3.5% not even fairly compensated for accepting junk IOUs.

hahahahamy Dear King A, who the heck in the first place provided the finances for ze germans?? and help build ze armee??if you can answer that, then you’ll know the rest of the storyUS did saved you, but not from the Germans…. at the edge of the cliff, with the British Empire almost in tatters, the US lends it hands to you so you can be their poodles.. you like it dawg??

We’ll just ignore this…Stocks must go up…

Maybe blowing up the factories, as the French car union are planning, to deal with excess capacity.

http://www.ft.com/cms/s/0/7c0f1c4e-7235-11de-ba94-00144feabdc0.htmlwho will win? Obama’s so called high standard or Goldman Sachs get its way and push Geithner and Bernanke around? Some how I think Goldman Sachs will book the cake and eat it. It always win. Bend over Obama.

How can Dr Roubini be of any value to “long term investors and business people making strategic decisions” when he was too early predicting the crash and never saw the recovery coming? Now he is speculating about a “double dip” recession. How the hell does he know if that is going to happen or not? He is like some mad cult leader making wild predictions about the future and you his followers lap it all up because you need a strong power figure to put some meaning into your empty lives. Get real everyone. This evangelical doom predictor is lining his pockets and providing for his retirement by earning money from his particular brand of speculation – just like all the other Dr. Dooms.Remember the words of Burton Markiel:There are three kinds of people in the market:• Those who don’t know.• Those who don’t know that they don’t know.• And those who know darn well that they don’t know and who get big bucks for pretending that they do know.In my opinion Dr. Roubini is either in the second or third category and I fear that he is in the third.Nouriel: If you are reading this – no offence mate but you are not doing your health any good with all this nonsense and overwork. You seem to be on some sort of manic trip and the sooner you come to your senses, get some medication and stop all this mindless speculation the better it will be for your own wellbeing and for the rest of us. A permanently depressive outlook is NOT an economic thesis. No one is going to give you a Nobel Prize for blindly throwing rocks at the US economy. You have impressed the empty heads and made some money out of it all. Now go back to your university and do some productive research before your celebrity status star burns out and you are left another object of ridicule like Jim Rogers and all the others who let mania push themselves over the edge of rationality. You said something that was half right and you milked it for all it was worth. But now you are overexposing yourself and the market is running away from you. Pull yourself back down to Earth and recognise that there is nothing special about your abilities. If you don’t, you will soon fall back to Earth was a bang and spend the rest of your life mouthing depressive predictions on CNBC hoping to recreate a fame that has passed its sell by date. It will be as pathetic and boring as it is watching all the other has-been Dr. Dooms on CNBC and seeing the air-heads lapping it up like they were listening to some divine utterances.Readers of this website: Get a life, this is no Messiah.

So you listened to him until March? Not all of us here are “millionaires”. As far as getting a life, you sir should calm down and live your few remaining years counting your millions. Some of us come here to learn about the ills of our world. it’s not all about making millions. if you don’t like the site and the contributors go elsewhere. and you seem pre-occupied with nouriels health and appearance, why is that? Does he tell you how to live your life?I take it you are from England and if so you should worry more about your country and its people than us Americans who read this web site and have no life. Your country is in way deeper Brown stink then we are.

Arthur, I’m a client.I made money listening to Roubini.He predicts economic turns, not markets. For stock picking and market timing, you have to do some actual work. For the rest, Roubini does the work for you.

Jasa,Well said.I forgot Artie. Please give us your take on the economic outlook for the US and detail why you are sooo bullish. We would be all ears I’m sure.

http://www.google.com/trends?q=unemployment&ctab=0&geo=all&date=ytd&sort=0

Well Said GSM!!!

Arthur,I run a small business outside the US but 100% dependent on US economy.I do not invest or trade in shares. Following advice from this forum – I have booked losses early, am reorganizing my business, have maintained profitability through last year without having to fire any employees. In great part this is thanks to Roubini and the fine people who contribute here.If you were following comments you would have seen how the nature of discussion has been evolving.I’m learning how markets work and could have traded the rally. But I have learnt it’s more important to build sustainable ‘systems’.A lot of activity in the stock markets now borders on ‘criminal’ it’s not everyone’s cup of tea.Good luck to you in your investments.

Mr Lin is not listing UK? Is it because they do not manufacture anything but just try to suck everyones money in and run their country on the banking industry?

That was meant to be funny, but sounds creepy in retrospect … sorry.

…and then deniedDJ White House, Citigroup Deny Obama Visit-Fox BusinessDOW JONES NEWSWIRESFox Business Network reported Thursday that the White House and Citigroup Inc. (C) bothdenied an earlier report that President Barack Obama visited the company’sheadquarters in New York Thursday.Fox Business Network had reported that the presidential limousine was at 399 Park Ave.around 6 p.m. EDT and that the building was on security lockdown.Citigroup is scheduled to report its second-quarter earnings at 8 a.m. EDT Friday.Web site: http://www.foxbusiness.com-Dow Jones Newswires; 212-416-2900Click here to go to Dow Jones NewsPlus, a web front page of today’s most importantbusiness and market news, analysis and commentary:http://www.djnewsplus.com/access/al?rnd=KnIseLdqBxd%2FK%2FXfGCl7AA%3D%3D. You can usethis link on the day this article is published and the following day.(END) Dow Jones NewswiresJuly 16, 2009 19:06 ET (23:06 GMT)Copyright (c) 2009 Dow Jones & Company, Inc.Friday 17 July 2009 09:06:00.000 AEST

Goldman going for an AIG repeat? Might give them another good quarter.

JasaI have already stated that my outlook for the US economy is the same as Warren Buffet. – “This movie will have a happy ending. I don’t know how long the movie will last, but I know that it will have a happy ending.”Nouriel has been proved half right once in his fifty year life and everyone proclaims him as the new economic Messiah. I have seen dozens of his type come and go over the years and I just know that this statue will turn out to have feet of clay like all the others. I’m not knocking the guy, I’m saying that people must be nuts to think that he can accurately predict either the economy or the market. No one can. Once you arrive at that conclusion, you are 90% of the way to being a successful investor or economist.As for those who asked if I lost in the recent stock market crash: The answer is that I moved my portfolio to “defensive” about half way through 2007 because things looked a bit scary and then used the free cash to stock up on shares from about December 2008 onwards. The lower they fell the more I bought. So although I lost in the big falls, my gains have wiped out most of the losses and I am almost back to where I started in mid 2007. That is exactly what Warren Buffett told everyone to do at the time and he has been proved to be correct. Yes I am down a bit, but it’s no big deal. It is not rocket science, it was just common sense.Believe the Jim Cramers in 2007 and you would have lost money. Believe Nouriel Roubini in early 2009 and you would have failed to make money. Go down the middle path and you will grow rich slowly. Give it enough time and you will grow wealthy. But you cannot speed up the process by listening to Nouriel or to anyone else because ultimately they are just whistling in the dark.”Sell in boom, buy in doom”. That is all you need to know to make money from the stock market. Nothing else.

I love reading the rantings of those who, like the Romans after the Fall, still refuse to believe their Gods (unrestrained greed, unregulated markets, “corporate citizenship” turned out to be just stone symbols of a false religion. Sorry Arthur, gravity does exist, and when boneheads like you denied that fact, Nouriel made schmucks like you into permanant enemies by pointing it out.Gravity rocks, dude. Enjoy it. It’s the only thing that keeps empty headed ideologues from floating off into space.

“Arthur” is a troll having a good time having you folks on. He’s having a laugh at how gullible you are to be taking his schtick for real.-Just a heads up from an experienced veteran of the infowars who has seen it all before.

My neighbor has a son in LA who is a long term state employee – his hours have been cut – by three days a month, and now he “hears” that paychecks soon to become IOUs. It will devastate them as they will be unable to pay bills, like home mortgage or buy food.Of course my neighbor, who is a retired school teacher from CA’s system and who I mentioned in a previous thread, has lost income from his rental property due to tenant who works for CFD (Calif Fire Department) now receiving IOUs, is himself in financial trouble. They worry that their teacher health care benefit will start to crumble and that their teacher pension benefit will start having to cut benefits. All this at a time when income they help rely on to fund their retirement from rentals that are not renting or from renter who is being issued IOUs and can no longer pay the rent! Thus my neighbor soon will not be able to pay his mortgage, buy food, pay bills.You tell me where this growing “default” is leading more citizens – if not the abyss!Let’s bail-out Wall Street some more, like CTI…

You have but to consult the entire sorry his-story of the human race to know it is not an outside chance but a balls-on certainty that the people will push back when the inequality/injustice factor reaches breakpoint.We’re close, and it’s coming. The richest pushed too far, realized it too late, and can’t get this genie back in the bottle now.When the only round ball you have to live on is finally consumed in all misery everywhere, blood is being spilled right round the globe, and the bombs going off seem like relief from heaven to the billions starving, you’ll wish you had listened to the egalitarians who fought so hard to prevent the destruction.

on target!

You forget every bailout was executed during the Bush administration. Bush gave the banks billions and lowered interest rates to zero. The fed was already trading toxic waste for treasuries in early 2008. It was Bush that gave Goldman Sachs a banking license.Obama is none too smart either. After all, he let Geithner run treasury and Goldman Sachs run the country, just like Bush did. However, the loss of a sheriff on Wall Street and the gift of 13 trillion dollars to Wall Street was all from Bush.

I agree that policy makers have a very limited amount of time to work with and judging from the previous and current US administrations the leadership fails to appreciate the position they, and we are in.I commented on Roubini’s unemployment article that the time is fast approaching when folks will turn to the ignorant, fanatical & tyrannical to lead the nations of the world in a way that the world has net seen in more than 60 years.

Art is just one of those mini trolls that are sold in tourist spots everywhere with flaming hair…

On another note related to the bigger problem of why TPTB are getting away with what they are doing, I would normally say something like “Skip to paragraph X to get the party affiliation of this guy,” because the usual practise by the MSM of shielding Democrats was to only mention the affiliation at the bottom, but Bloomberg has taken it to new levels by not mentioning Hevesi’s party affiliation at all …Hevesi Donor’s Selection Spotlights Pay-to-Play at Pension Fund /By Karen FreifeldJuly 17 (Bloomberg) — EnTrust Capital Inc., a hedge-fund firm whose founders contributed to the campaign of New York Comptroller Alan Hevesi, received millions of dollars of pension money to invest while he was running the state retirement fund, public records show.Hevesi’s staff suggested the state use EnTrust to invest its money, according to Consulting Services Group LLC, a company hired to vet and choose firms. EnTrust was one of 50 firms recommended by the fund in 2006 and 2007 to CSG and one of 15 firms chosen, said a person familiar with the matter. EnTrust’s vetting was a priority, a person familiar with the process said.Hevesi, comptroller from 2003 to 2006, and CSG are being investigated by U.S. regulators and New York’s attorney general over corruption at the fund, valued at $140 billion in 2006. To show criminality or liability, it must be established that the parties involved had the intent to trade a kickback or a campaign contribution for state business, lawyers said.“Pay-to-play is absolutely at the core of all this,” said John Coffee, Columbia University securities law professor. “Underlying is an unwritten norm of reciprocity. If you want money, you have to contribute and, if you do contribute, you can expect that money will be given to you for investment.”Coffee said it’s harder to prosecute contribution-related deals for state business than kickbacks paid as fees. “You have to be able to show a specific quid pro quo,” he said.Hevesi received campaign donations from 46 percent of the hedge fund and private-equity managers he picked to manage state money for the first time, according to state records.Hevesi DefenseInvestment managers were selected by staff and independent advisers “solely on the basis of whether the funds are good investments,” David Neustadt, Hevesi’s then-spokesman said when the statistics were disclosed in 2006.It’s not current practice to suggest to vetting companies such as CSG which firms should be given state money, said Robert Whalen, a spokesman for the New York state comptroller’ office.EnTrust’s situation came to light when CSG told clients in a June 30 letter that state pension fund personnel “suggested” EnTrust as a money manager. After vetting, EnTrust got $15 million on July 1, 2006, the same day CSG, which also managed a so-called fund of funds for New York, got $200 million to parcel out to investment firms, according to Whalen.CSG chose 13 other firms on its own during the same 2006- 2007 period, the person familiar with the matter said. It didn’t specify which personnel steered it toward EnTrust or if it was told of the contributions to Hevesi. Hevesi pushed EnTrust as a fund recipient, a person familiar with his recommendations said.CSG Comment“CSG has no comment on the letter or its contents,” Ellen Moskowitz, a spokeswoman for the Memphis-based company, said.Hevesi’s fund role is an “ongoing matter” in a two-year investigation, New York Attorney General Andrew Cuomo said last month when asked why the former comptroller, named in indictments of others in the pension-fund scandal, had not been charged or cleared. Alex Detrick, a spokesman for Cuomo, said there has been no change in Hevesi’s status.“Alan Hevesi categorically denies pushing EnTrust at anytime and to anyone,” his lawyer, Bradley Simon, said in an e-mailed statement.Hevesi resigned as comptroller in December 2006 after pleading guilty to using state employees to chauffeur his wife. Thomas DiNapoli was named in February 2007.Cuomo’s office has said EnTrust is not being investigated. Cuomo, who used EnTrust to invest personal and campaign funds, recused himself on any matters involving the firm. His office has been focusing on illegal kickbacks paid by financial firms to so-called placement agents, including Henry “Hank” Morris, to win pension-fund investment business.Hank Morris ChargedMorris, Hevesi’s former chief political consultant, was indicted in March by Cuomo and accused of taking kickbacks and pressuring fund managers for campaign contributions. CSG is among the firms that hired Morris. It denies wrongdoing.“The CSG matter is ongoing, and we therefore cannot comment on it,” Detrick said in an e-mailed statement. “There has been no change with respect to the status of EnTrust.” CSG is in preliminary talks with Cuomo’s office to resolve his probe of the firm, according to a person briefed on the investigation.EnTrust has not been named by the U.S. Securities and Exchange Commission, which sued Morris. The SEC previously declined to say if it is investigating EnTrust or CSG, which is named in the agency’s complaint against Morris. CSG said in its letter that the SEC had warned the company of a possible agency suit against it involving placement agents and pension funds.John Heine, a spokesman for the SEC, declined to comment on whether the disclosures in the CSG letter will be investigated.Liberty OakEnTrust’s Capital Waters Fund Ltd. received the $15 million in 2006 through CSG’s Liberty Oak Capital Fund LP, a portfolio of hedge-fund investments. CSG created Liberty Oak in 2006 for the state pension fund. CSG, as a general partner of the fund, managed hedge-fund investments for the state. After Hevesi left office, Entrust received another $5 million in state funds through Liberty Oak on June 1, 2007, Whalen said.“EnTrust never retained or made any payments to Hank Morris or any other third party in connection with the Liberty Oak investment, nor did it ever ask Alan Hevesi or any CRF personnel to direct CSG to allocate funds to EnTrust,” Brandy Bergman of Sard Verbinnen & Co. in New York, a spokeswoman for EnTrust, said in a statement, referring to New York’s Common Retirement Fund.“EnTrust had absolutely no role in CSG’s manager selections, and only received funding after successfully completing the same due diligence process CSG applied to all hedge funds,” she said.EnTrust Was QualifiedCSG said in its letter that it concluded EnTrust was qualified to manage the investments.EnTrust never used or paid Morris as a placement agent so there was no investigation of it, Cuomo’s Chief of Staff Steven Cohen said last month in disclosing Cuomo’s recusal.Cuomo and the SEC are investigating money managers and their placement agents who used ties to public officials and kickbacks to buy and sell access to the $2 trillion in U.S. public pension systems. The regulators’ indictments and civil complaints depict officials allowing political and personal ties and financial self-interest to trump merit when deciding who was to be entrusted to invest taxpayer money.Cuomo recused himself over EnTrust when he took office in 2007, Cohen said. Cuomo has received campaign contributions from EnTrust’s principals, just as Hevesi had, public records show.EnTrust was founded in 1997 by Goldman Sachs Group Inc. alumni Gregg Hymowitz, Michael Horowitz and Mark Fife, according to the firm’s Web site.Contributions to HevesiAll three contributed to “Hevesi of New York” according to Board of Election records. In October 2004, Hymowitz contributed $5,000. Fife, of Manhattan’s Upper East Side, contributed $2,500 in October 2004, and Horowitz, of Stamford, Connecticut, gave $2,000 in November 2004. All three made other contributions on June 29, 2005, records show.Bergman, speaking for all three, said they declined to comment on the contributions.Morris pitched EnTrust to state pension officials, according to a person familiar with the discussions. At a fall 2004 meeting attended by Hevesi and Deputy Comptroller David Loglisci, among others, Morris tried to get the state to invest money with the EnTrust, the person said.“I’m working with Hymowitz,” Morris said at the meeting, according to the person.William Schwartz, Morris’s lawyer, didn’t return calls seeking comment. Irving Seidman, Loglisci’s lawyer, declined to comment beyond repeating his indicted client’s innocence.Morris’s PitchMorris repeated his pitch for the pension fund to invest with EnTrust on numerous occasions, the person said. Morris also solicited certain fund managers doing business with the state pension fund to make contributions to Hevesi’s re-election campaign, according to his indictment.CSG said in its letter to clients that it had done nothing wrong in entering into an agreement in July 2005 with Searle & Co., Morris’s broker-dealer, to be its agent.The SEC said in its complaint that the pension fund bought a $635 million limited partnership interest in Liberty Oak Fund in 2006, and $130 million in 2007, as part of an “undisclosed quid pro quo arrangement.” In exchange, CSG paid Searle $1.15 million, 95 percent of which went to Morris, the SEC said.“CSG did not engage in a pay-to-play scheme,” the company said in a statement on its Web site. The company’s agreement with Searle complied with the SEC’s rules and was fully disclosed, the company said.The Hank Morris criminal case is People v. Morris, 00025 2009, New York state Supreme Court (Manhattan).To contact the reporter on this story: Karen Freifeld in New York at kfreifeld@bloomberg.net.Last Updated: July 17, 2009 00:01 EDT

CIT to possibly file bankruptcy today. On Deck GE Capital. Remains to be seen how the Govt deals with this one. May be the same path as GM Bankrputcy- wipe all the bad and start over with all the good. New GE IPO – late 2010 – loldo not understimate the effect of Bankruptcy of CIT on small and madium size business. Some say minimal, others say horrific. so who and what to believe? based on past 2 years I have to think those saying horrific will be right. waht gets me is that with alomst every “bad” eceonomic thing there are always 2 schools of thought… so in effect it all is nothing more than gambling, guessing and a crap shoot.

today calif announces its unemployment number for june- estimated to be 12% now. So where is the recovery?Part-Time Workers Mask Unemployment WoesIn California and a handful of other states, one out of every five people who would like to be working full time is not now doing so.After Richard Smith, 58, was laid off from jobs at two carmakers, he moved to Charlotte, N.C., and found only part-time work. He makes $9.50 an hour repairing clubs at a Golf Galaxy store.It is a startling sign of the pain that the Great Recession is inflicting, and it is largely missed by the official, oft-repeated statistics on unemployment. The national unemployment rate has risen to 9.5 percent, the highest level in more than a quarter-century. Yet it still excludes all those who have given up looking for a job and those part-time workers who want to be working full time.Include them — as the Labor Department does when calculating its broadest measure of the job market — and the rate reached 23.5 percent in Oregon this spring, according to a New York Times analysis of state-by-state data. It was 21.5 percent in both Michigan and Rhode Island and 20.3 percent in California. In Tennessee, Nevada and several other states that have relied heavily on manufacturing or housing, the rate was just under 20 percent this spring and may have since surpassed it.Full article at: interesting data points in it to…http://www.nytimes.com/2009/07/15/business/economy/15leonhardt.html

this is funny.. im guessing they all thin the economic recovery will hinge around Christmas spending… isnt this a version fo robbing form peter to pay paul… HO HO HO …Stores Take Christmas In July More SeriouslyNick White, a consultant in the Gerson Lehrman Group network, called the strategy a good bet for the struggling retail industry.”They’re not sure they’ll have a job in a couple of months,” she said. “This kind of gives them the nudge to start thinking about Christmas earlier than they would have in the past”http://www.washingtonpost.com/wp-dyn/content/article/2009/07/14/AR2009071403246.html

SUMMERS SPEAKS he says ” we need to export more to get out of this” Export what? What do we make that the rest of world can afford and what China can provide cheaper? I take it as Average Joe American you need to make less money to live in the US so we can match the Chinese. This guy and all of Obama’s minions have no clue. they need to focus on NO JOBS, WAGE DESTRUACTION, FORECLOSURES instead of Cap and trade, Health Care Reform ( i know this needs to happen but fix the big problems first). It’s almsot as if Obama wants to make sure all the things he promised to do in his campaign get done albeit half ass. Whats the Rush Obama?We will create and save jobs – BSWe will reform Health Care – BSWe will not raise Taxes – BSWe will reform Energy – (cap and trade) – BSWe fix Education – BSEarth to Larry – we are on pace for 3-4 million foreclosures this year….Larry here a few other headlines today that trump yours!Foreclosures keep soaring as unemployment becomes main cause of housing woesWASHINGTON (AP) — The number of U.S. households on the verge of losing their homes soared by nearly 15 percent in the first half of the year as more people lost their jobs and were unable to pay their monthly mortgage bills.The mushrooming foreclosure crisis affected more than 1.5 million homes in the first six months of the year, according to a report released Thursday by foreclosure listing service RealtyTrac Inc.The data show that, despite the Obama administration’s plan to encourage the lending industry to prevent foreclosures by handing out $50 billion in subsidies, the nation’s housing woes continue to spread. Experts don’t expect foreclosures to peak until the middle of next year.more at:http://www.sun-sentinel.com/business/nationworld/sns-ap-foreclosure-rates,0,1249228.story========================Rising unemployment accelerates foreclosure crisishttp://news.yahoo.com/s/ap/20090716/ap_on_re_us/us_foreclosure_crisis_unemploymentWASHINGTON – Relentlessly rising unemployment is triggering more home foreclosures, threatening the Obama administration’s efforts to end the housing crisis and diminishing hopes the economy will rebound with vigor.In past recessions, the housing industry helped get the economy back on track. Home builders ramped up production, expecting buyers to take advantage of lower prices and jump into the market. But not this time.These days, homeowners who got fixed-rate prime mortgages because they had good credit can’t make their payments because they’re out of work. That means even more foreclosures and further declines in home values.===================so we are on pace for 3-4 million foreclosures this year….1.5 million homes in foreclosure in ’09Homeowners fell behind on mortgage payments in record numbers during the first six months of 2009. The future doesn’t look much better.http://money.cnn.com/2009/07/16/real_estate/RealtyTrac_foreclosure_report/index.htmNEW YORK (CNNMoney.com) — The foreclosure plague is not going away — it’s only getting worse.A record 1.53 million properties were in the foreclosure process — default notices, auction sale notices and bank repossessions — during the first six months of 2009. That was 9% more than the previous six months and 15% more than the same period of 2008, according to a report released Thursday by RealtyTrac.There were a total of 1.91 million filings resulting in 1 out of every 84 U.S. properties receiving at least one filing in the first half of the year. Banks repossessed 386,800 properties.

PLEASE ENLIGHTEN ME: How in the world under these conditions does the RECESSION END BY 2010? These predictions by economists are “pie in the sky”. Every new piece of legislation Obama’s administration is passing will further increase taxes, result in more layoffs, more foreclosures, greater deficits and debts, etc. The logic and science of this type of economics completely escapes me.

http://www.nytimes.com/interactive/2009/07/14/business/economy/20090715-leonhardt-graphic.html

@ Fedup- Exactly what I Have been thinking. Remember they didnt admit to the recession until last August, although Roubini had been saying since Dec 2007 we were in one as were a lot of others. Take 18 months and add it to either good news or bad news to get relevant time frames.

good post-this actually makes sense to me!

There is nothing to worry, folks. I am sure Cheney and friends will be back to solve the unemployment issue once Obama’s 4 years is up.

Even 18 months doesnt sit well with me. Housing, employment and debt are the drivers here. I see nothing in the next 36 months that will clear the housing inventory and increase housing values. In fact, with the increase in foreclosures, ARM resets and interest rates, I see housing going down and staying down for awhile. Employment? Manufacturing is gutted, and the financial industry is dependednt on government largesse and regulatory forebearance. Debt? Debt repayment or discharge is the only way to work through it, andit will take more than 36 months to resolve.

We will have approx -6% GDP for a 12 month period. not that far from double digit if you believe the Numbers they put out. Think about it though, every number we see is double digit down, and most 20-30-40% down depending on the segment. Housing- down 35%, unmeployment U6 of 20%, Auto sales down 40%, shipping down 30%, Tax revenue collections at Fed and State levels down 20-40%. how can they all be down so much in 1 year yet GDP is at only -6% and theya re saying will see growth of 1-2% on 2010. the math does nto add up. Only thing I can think of is the Bailout, Stimulus monies and all the FED injections are propping things up.Does anyone knwo of nay segment that has true real postitive growth? maybe some pieces of health care?

Oh yeah, a tiny little war and there are no unemployment left.

What is the big fuss about the recession ending after 24 months or longer? The reality is, as Dr Roubini has stated, any recovery will be so weak that it will barely be noticeable. The way that the govt and CNBC try to pump this up for more than what it is should make it clear they are clutching to anything to remold people’s impressions and feed the financial fee for nothing black hole–the pseudoeconomy if you will.The insidious depletion of productive good paying jobs will render any recovery nearly impossible. Even if you can live/squat in a paid for house, if you have no job, you are still stranded because no food is on the table, utility bills are not paid. Any discretionary spending and with it the dawn of a “recovery” are a long way off.

On the other hand, if the troops all come home, will the reservists be able to go back to their former civilian jobs?Do unemployed youth first time enlist in greater numbers? I guess that is one way to increase “employment”, or rather deployment.

Your optimism reveals a lack to perform due diligence on the current state of the economy.Come back with some happy numbers and people will listen.

How about back to back increases in housing starts and building permits, for starters?

Another point. About the “rigged” U.S. stock market. Is the Canadian market rigged? Is the U.K market rigged? Is the Aussie market rigged? Are the European bourses rigged? Is the Chinese?Apart from Arthur’s, I don’t seem to hear of many success stories on this blog. Maybe that’s it. Everybody here has eaten sour grapes.

Take a piece of paper, draw a line down the middle and label each side. One for positive commentary, the second for negative commentary. Now go back and look at a few random strings and put a tick mark in the appropriate column for the sentiment expressed in the post. I would guess, overwhelmingly, that the vast majority of the posts are in the negative column.I saw a post earlier from Giraf that pointed out some interesting stuff he’d read in the Gartman letter. There was not one response to these potentially positive developments. Yet there has been much “piling on” to negative negative posts.Enough said. I think the evidence speaks for itself.

“These fools, building houses” are the very essense of what America was built on and what it once was all about. Entepreneurs. Risk takers.Think about the employment building these houses creates? Would you have these carpenters, bricklayers, plumbers etc., have no opportunity to earn a living and feed there families? Whose side are you on here?

Dear 67(youngster),What should I tell my neighbor of whom I shared a little about above. That for some folks like yourself “the sun never stops shinning.” That is a hard word for those who have hit some speed bumps in life. Then reality of another kind sinks in as their descent into the Abyss accelerates. Others begin to take notice and realize that this could happen to them.I understand HOPIUM coated lollypops – in my youth I lived on the pleasure their effects delivered. Certainly one must have some hope to have the will to live. But now, after a long life at 69; not just 67, I realize that there is a severe downdraft brewing and it has been brewing for a long time. The criminal elite have won and since they have it seems it was meant to be. Thus more and more will be sucked down into the Abyss. Be wise and prudent lest you find yourself in a similar circumstance. May we all learn what has been missed by our over-abundant pursuit of “happiness.”

The reason most of us are here at this site is because we have been lied to and misled by the MSM and our govt including their regulators and are sick and tired of it. We have decided to get more involved, educate ourself and report our findings in order to help others wake up from the continual mass manipulation of a so called democratic system which purports to treat all people fairly and to maintain an equal playing field for those who work hard. What you term “negative posts” is actually reality to many of us. Shall we go on believing that Wall Street and the FED need no further investigation or regulation, that 0% down mortagages are wise, that no U.S. manufacturing base will result in high paying American jobs? Perhaps your criticism should be directed at NR as he was one of the very few who predicted this crisis while others scoffed at him; oops, wait a minute, you can’t criticize him because he was RIGHT and YOU WERE WRONG! If you want positive spin return to the thousands of MSM sites or peter pan.com.

Please Mr Jobs…Tell us about the jobs outcome without bailout money!

You think whineing to each other is doing any good? You should be organising, getting out on the street protesting. Push it in MSM face.People thought 0% down mortgages where great when, to quote an old Guest “prices were going to sun”.I think NR has done us all a great service and he was the only guy talking about the impending crisis. I didn’t scoff at him. I haven’t owned a stock in 15 years because I’ve felt they were wildly overvalued, so I missed all the updside and all the downside.But, as I’ve just asked Morbid, what are you going to do when NR eventually turns positive on the economy? And he will, it is just a matter of time. 6 months, a year, 18 months. What wil you whine about then.

I basically agree with your 3 factors, although I would rank them backwards in priority. Basically, America, and most of the English speaking world, Canada, the U.K., etc., have been living beyond their means for a very long time. We are now paying the piper, as I’ve always expected we’d have to. It took us years to get into this mess and I suspect its going to take years to get back to what you call “trend growth”, whatever that is.I don’t know how long this blog has been in place. I’ve been drifting in and out for about a year. If it were in place in the late nineties, I wonder if all the posts were as negative as they are today? Or would everybody have be riding the wave of prosperity of the day. If any of you can answer that, I’d appreciate knowing.Housing will eventually right itself, the birth rate and immigration taking care of that. The auto industry will recover. My vehicle is 7 years old with 150,000 miles on it. How long will it run and still be reliable? Sometime in the next 24 months, I will have to replace it and so will many more people. THe U.S. auto fleet is aging rapidly. These again will be engines of growth.I share a number of the concerns expressed on this site. American workers have been priced out of the manufacturing businesses. Only a weaker dollar and unions being prepared to work for less will bring those jobs back. It will happen, it just takes time.

Just a reminder. Prrior to 08, Roubini said cash is king in 08 and then later for 09. Arthur, to bad you did not stay in cash.

People were up in arms waaay back in 2008 when there were upwards of 350,000+ jobs lost per month.And now it’s “green shoots” when there’re “only” less than 600,000 jobs lost per month?Frog-boiling water. It’s all relative, isn’t it?

VP BIDEN SAYS WE NEED TO SPEND LIKE DRUNKEN SAILORS TO AVERT BANKRUTCYA reknown past president said: “Ask not what your country can do for you, but what you can do for your country.”Many Democrats agree with me, adding more debt and giving it away in a “nanny state” is the root cause of today’s economic dilemma.Who do we believe the old Democrat or the new one?

Brian, thank you for sharing your real-world experience; it is very valuable. Keep comin’ back.

Ditto Brian. Good real life info.

PPT was in full swing this week.

First column is approve- second is dsapprove. The party is Over. and PelosiCare is Disaster for him.Obama7/17/2009 52% 47%7/16/2009 51% 47%7/15/2009 52% 47%7/14/2009 53% 46%7/13/2009 53% 46%7/12/2009 52% 46%7/11/2009 51% 48%7/10/2009 51% 48%7/9/2009 51% 48%7/8/2009 52% 48%7/7/2009 52% 47%7/6/2009 53% 46%6/30/2009 54% 46%5/31/2009 58% 41%4/30/2009 54% 45%3/31/2009 59% 39%2/28/2009 59% 39%1/21/2009 65% 30%Bush approval ratings:Dec-08 35 62Nov-08 35 62Oct-08 33 64Sep-08 35 63Aug-08 34 63Jul-08 33 65Jun-08 32 65May-08 33 65Apr-08 34 63Mar-08 36 61Feb-08 37 60Jan-08 38 59Dec 37 60Nov 37 60Oct 37 61Sep 38 59Aug 38 59Jul 38 60Jun 35 62May 36 61Apr 39 59Mar 40 58Feb 41 57Jan-07 41 57http://www.rasmussenreports.com/public_content/politics/obama_administration/obama_approval_index_history

You will lose credibility if you don’t back up your conclusions. Don’t post unless you have something useful to say, good or bad. No one is mad, but sometimes everyone loses focus on the real issues and your rants are just that.

0067,You are right about me – I will be “lost” without “whining.” That is why I picked the handle MORBID – because at this point that is where my psyche is immersed.You are too hopeful for my tastes. What are you going to do if things get even worse?I get all the “sunshine” I can take from the ObamaNation of Desolation so if this board bothers you so much then why hang around?I am a retired engineer and in that profession one looks for what is wrong in a design for that is what will “do it in.” Must I say more about my psychic temperament?Given the criminal elite of banksters, media and politicians – do you expect ever better times ahead? Are you sucking on Hopium coated lollypops? I hope this criminal Casino Ponzi scheme crashes and burns! It is unsustainable.

@subgeniusThis is the line I have been thinking on. Professor has said higher oil prices (>100 $/Brl) will turn the recovery into a W. today oil is hovering around 70. guess what happens if we were to magically recover back to 07 (or even 08) levels. Even if you discount the speculation to say $40/B we will still be in trouble (assuming peak prices around $150/B). It seems to me that we are going to bounce around at the bottom for a few years till we figure out a way to grow without consuming as much oil based energy. Good luck with that!!!I don’t want to bring in oil supply constraint into this debate but am quite amused by the lack of public discussion about why the prices shot up to $150/b. I agree that there was a lot of speculation going on but to be willing to speculate you still need some fundamentals supporting the play.

Excuse me? Rants?

Also, lighten up! I was clearly having some fun. None of us know where anything will be tomorrow, let alone two weeks time. Also, for credibility’s sake, choose yourself a handle rather than hiding behind “Guest”.

Probably worse. ? would be how much. I for one don’t think funneling bailout money and liquidity to the financial systems ever got or had gotten to the companies that employ people. So where did it all go?

Hi Subgenius, any comments about the huge fields being developed off Brazil?

I am expecting oil prices to plunge in the short term, before reversing strongly. There is a glut at the moment (current production outstrips the recession/depression-curtailed demand by something of the order of 1 million barrels per day), but this is short term. Production at Cantrell (the big field in Mexico) is declining by more than 7%/year, Ghawar (the REAL biggie in Saudi) is at an inflection point – this is the “swing” producer, and if it depletes at rates similar to Cantrell we are in for some trouble. This is looking likely as the Saudis have used all available methods to keep the flow rates high, and experience with other fields strongly suggests this eventually results in a rapid decline.Remaining reserves are poor quality, difficult locations (deepwater), and difficult to extract (shales and sands – these require massive energy and water inputs to process).Declines in price recently, combined with problems obtaining credit, have wounded the development of the extraction and processing operations – which is likely to lead to issues if the recession appears to abate and demand climbs, as the timescales required for implementation are years/decades and there are well-documented problems both with restarting mothballed projects and retaining the required skilled personnel through fallow times in the extraction industry.There is some debate about the maximum cost for oil the current arrangement of industrial civilization can sustain, but there is little doubt we will find out some time in the next few years if those widely-reported “green shoots” convince enough of the population that life is resuming the “normal” trajectory and demand rises by as little as 2%.I am currently following the development of wind power using kites to sweep large areas at high altitudes. The tech is currently in the development stages (a large-scale trial is under construction in Italy), but previous small trials look good. This is one of a handful of technologies that appear to have the potential to generate large amounts of power with relatively little resource impact. Only time will tell…

oh – to avoid confusion the 16000 feet is to the field, not the seabed – the water depth is about 7000 feet I think.

Thank you Arthur Buffet. Time to move to Omaha and replace the Oracle !

California, Nevada Match All-Time Unemployment HighsState unemployment figures are out and Michigan is still leading the country with 15.2 percent unemployment. That’s still a full percentage point below its all-time high from 1982 of 16.9 percent, but the four states filling out the top five — Rhode Island (12.4), Oregon (12.2), South Carolina (12.1), and Nevada (12) — all match their their all-time highs.And how about the national axis of gloom that is MichiCaliFliArivada (that is, MI, CA, FL, AZ and NV)? They claim three of the top six worst unemployment rates.California clocks in at number six with an 11.6 percent unemployment rate, joining Michigan and Nevada in the top six. All this information and more you can grab from the super-helpful table provided by the Real Time Economics blog at the Wall Street Journal. Here’s a look at the top of the graph, organized by highest unemployment rate:One other interesting fact to note about this awesome chart that lets you compare historical highs and lows between states. Alaska’s all-time lowest unemployment rate according to the chart is 5.9 percent. South Dakota’s all-time high? 5.9 percent, exactly.http://business.theatlantic.com/2009/07/california_nevada_match_all-time_unemployment_highs.php

@ Average Jane way up the page at 14:08& Giraf (maybe already lost)Frog-boiling water. Good comparison.Arthur, if you had been here long enough you would know that or Professor has been both consistent and doesn’t trade markets. If you’re looking to front run trades you should be sucking (explicative deleted) at GS. Our professor has been telling you that our economy stands between the contraction that will be caused by FED moping up the money they have created and the contraction that will be caused by inflation and higher interest rates if they fail to mop up that money. Those who have ears…If you feel you can continue to make millions (of paper money) trading these markets, good for you. But ain’t no wild card ever that could beat the house! And when they (TPTB) really need money – like now- it’s your money they’re going to take. Sucker’s bet.For the rest of us, how do we get out? How do we start over again, at advanced age, knowing that our retirement, our 401k’s are (explicative also deleted)? I’m not done. I may have lost something to these fools – or have been a fool myself – but I have something left. New found wisdom being part of that. Thanks Professor for helping with that! I went to school in the 60’s after already having been at war. Maybe I shouldn’t have said that. It can give you the wrong impression. My war was really, really REMF. But I heard all this talk on campus already. 40 years ago. The accusations. The rap – we would say rant today. That goes nowhere. It’s time to cut the chit-chat. What are we going to do? For ourselves? For each other? The end of this world that we knew is coming. Time to choose sides. No more chit-chat. Where do we go from here? How do we bring it about

Thank you. But I am NOT a bull any more than I am a bear. I never said that we were in a bull market. Read my posts, I NEVER said that. I would expect the market to move sideways for a few years until this mess is all cleared up. But if you invest in diversified high yielding stocks you will get a better income than cash and when the upturn does come you will counter inflation by being in stocks. The March low opportunity has gone and I doubt we will see a rise like that for many years. Nouriel’s claptrap kept you out of the rally so get used to reality and stop calling me a troll everyone. This is a very unbalanced forum and I am trying to inject some balance. America always bounces back quicker than people expect and it will happen again. I don’t know when, but I am sure that it will happen.Nouriel wanted the banks nationalised a few months ago and now they are paying pack the TARP money as fast as possible. The man is a buffoon in my opinion, pretending that he knows everything when he clearly does not. Nouriel’s luck has run out and it is time for everyone on this site to realise that they put their faith in yet another false prophet. There are no successful prophets in economics or investing, just a bunch of clairvoyant forecasts which are sometimes right and sometimes wrong.

I want to see;- new UE claims trending lower over 3 months UNDER 400k- sustained rise in hours worked.- sustained rise in weekly wages- sustained rise in internal US rail freight/air shipments..all happening together. THEN I will acknowledge this part of the US economic decline has halted. These are coincident to leading indicators. Forget stocks at present for an LI, they are just the playground for GS and therefore meaningless as a tool.That would not necesssarily growth has begun.

I don’t want to eoffend anybody, but in my view the great majority of posters on this site are suffering from a depressive personality disorder. It has nothing to do with economics. This site attracts the negative people in our community because they empathise with the strong negativity emanating from Nouriel. Many of them are probably also Christians who are expecting “a time of trouble such as never was” and millions slaughtered at the return of Christ. Their homes will be over insured and they will lay in bed awake at night worrying if they have locked the back door, or if their hearts are beating right. If they were a wildebeest on the Serengeti they would be the first to run from the water hole if they saw the grass move in the wind and they imagined that they saw a lion approaching.You people are a bunch of worry guts and that is what has attracted you to this site and to be followers of the chief worry guts Dr Roubini. He talks with a funny accent and talks doom and gloom in a convincing manner so you think that you have found a saviour. But he has robbed you of your gains in the spring rally and if you continue to follow him he will leave your 401K in the gutter.

It is not a “crimminal system” at all. A diversified portfolio of stocks is an investment in the collective business world of the US. Long term you gain the “equity risk premium” that beats all other investments. Google “equity risk premium” and you will realise what I mean. Stocks are volatile, but over the longer term they beat everything except bank robbers.

You still at the top of that mountain, Blind x?THought you would have forgotten groundE by now.

It is also wrong to say that a 15% fall in the dollar means that you lose 15%. If you live in the US you lose nothing because you spend in the dollars that you earn. Your outgoings fell 15% along with the dollar and you did not lose one cent.

Morbid vs Guest0067 – now thats a battle woth watching… have a great weekend boys!

Arthur, where are the earnings to support the dividends? I realise that markets don’t go straight down or straight up. However, their is no fundamental support for your argument. The shills would have us believe that earnings are coming in ahead of “expectations”. That is simply because the anal-ysts have lowered expectations so that companies can beat them. This after months of over estimating earnings in the bear market.If one takes a look at earnings, almost always we see revenues down. Companies are cannibalising themselves to try to squeeze more out at the bottom line. If the economy doesn’t turn, these people eventually run out of room to cut costs. They can’t cut costs to zero.Beware those safe diversified high yielding stocks. Didn’t GE once be one of those companies?

Perhaps the market is rising in tandem with a declining dollar, which represents no net gain in wealth. See the following article by JS Kimhttp://seekingalpha.com/article/142539-can-rising-stock-markets-serve-as-a-confirmation-of-a-crashing-economyI would also recommend not putting money into stocks for most people. The knowledge, skills, self-control and self-knowledge needed are too great and the learning curve is too costly. So even if people did not benefit from the latest sucker rally (Roubini’s term), he at least kept them out of stocks. Additionally, the stock market is turning into a casino with GS front running trades according to Tyler Durdan and others. Do you really want people to throw what little money they have into that viper pit? I would imagine that Arthur has deep pockets and can take substantial losses.

All opinions are welcome, different point of views from the majority even more. But I like sound discussions. Cheap talk leave it to the main media that need to hypnotise the sheeple. What does that mean that “it will all end well”. Sure enough it will improve sometime. Even the Roman empire could have said that. It took just 800 years of middle ages and then the Renaissance come.To sell useless optimism in face of the fact that a fascist minority has taken hold of what you still call market is either stupid or show some invested interest. If you were following the blog better, you would know that a very well respected guest, Octavio Richetta, expressed very positive forecast on the market when the government in March helped the banks in all possible ways. (I think) he played accordingly and shared his opinion with all of us, without the urge to bash Roubini or the bloggers. I have my opinions, you have yours, but let’s talk on facts. Sure it will all end well for Buffet, how can it be different with the kind of insider knowledge that he and his friends have?

The technical format of this forum means that after a couple of days it becomes impossible to carry on any sort of meaningful discussion. There are dozens of posts all mixed up with vertical lines stretching down the page in hopeless confusion. I’d like to discuss the Roubini thesis in detail and provide a number of counter-arguments. I would welcome an informed debate about his views with those who support his ideas. But the limitations of this format make that completely impossible. If the good doctor or one of his helpers is reading this maybe they would give some thought to purchasing high quality forum software and let us have a good discussion where we can separate the different discussions into individual threads and not have everything muddled together on the same page, or even different pages, as we have on this website.I once ran a stock market forum and I used V Bulletin. You people need that, or one of its good competitors. You also need to register the members to cut out all the abuse and give yourselves the ability to ban posters who don’t stick to the rules.

Go to a site where your opinion matters. Why would you distress yourself reading all the ingnorance on RGE, from the contributors, from Roubini. Have you nothing better to do? Better yet why not start your own site since you are an expert and know how to do it better. You seem to have all answers.

I beleive he said from Ventura County.

Bingo, economicminor! Now you’re ready to join me in a toast to Michael Hudson.

That did not work. Try the following instead: http://www.theatlantic.com/images/issues/200907/roubini-wide.jpg

But you have to realize that double dips, even quarters of growth, within recessions are normal. Take the 1980s recession.The point being that, if household networth has dwindled, and its source of income (employment) has dwindled, the consequences will be a reduction in expenditure. Just like a firm whose worth of assets has dwindled, and whose revenue has decreased, will cut expenditure:1) Because it is more prudent to do so2) If your firm needs financing, even assuming similar leverage to pre-crisis levels, there are lesser assets to take a loan against, and lesser revenue, so as to keep your financiers cautious. Untill household wealth recovers a lot, the pre-crisis level expenditure is unlikely to return. Hence, even if soon enough there will be an end to contraction, recovery will take years, as the household net worth will have to rise, and unemployment will have to decrease.On the other hand, there is a lot of uncertainty in that, during the depression, consumer-spending wasn’t as big a proportion of GDP as it is now. If deflation occurs, the purchasing power of the consumer is increased, whereas the real value of the debt of the firms is increased (the consumer benefits and the production side hurts). However, with consumer spending comprising 70-odd percent of GDP, imho, inflation will be the real killer as it will decrease purchasing power. So, while in depression deflation would have been worse, now given the dependency on the consumer, inflation might be worse. Also, what happens if inflation is unchecked, and the world reacts by dumping the dollar?So, Roubini is right to be worried, and to express those concerns. At least he is optimistic enough to say that there is light at the end of the tunnel..

You are wrong. After the March rally commenced Nouriel wrote many blogs and gave interviews saying that it was a sucker’s rally etc. He has now stopped commenting on the stock market because he was proved 100% wrong. But he does not admit his error; he just keeps making new predictions based on his mentally depressed outlook on life and you his follows seek to hide his errors by making untrue statements like the above.

Subgenius, I assume by “inflection point” you mean that daily production will shortly start to decline at Ghawar, ie, if q(t)=amount of oil in Ghawar at time t, then daily production is q’(t), so currently q”(t)=0.

p,your transforms are suspect as they involveirrational projection out to unspecified andfrankly fictitious postulations that havelittle concrete value. i would, rather,talk to my local truck driver and see ifhe does any driving for barter or trade in kind.also, your local cooperative may have somefresh vegetables that they would be willing to barter for a commodity based rational transform.ps.good one!

People, your first mistake with “Arthur” was believing for one instant that he is who he says he is and that anything he says is true. I’m telling you, he’s a PROVOCATEUR – and an amateur provocateur at that.Come on…isn’t it obvious? He started with “Roubini, Get out of America and go back to Iran with your anti-Americanism”?! And he tries to paint everyone here as members of a “Roubini fansclub” – which shows how little he actually knows and thinks.Good Lord, folks – you’re being duped here by an internet troll looking for nothing more than to get your goats. He has no money, he isn’t British, doesn’t live in Oz, doesn’t trade, he’s making it all up. His goal is simply to disrupt. It’s how he gets his rocks off.Don’t help him gizz all over this forum.

Thanks MM, same to you.

Actually I meant that they will fix it in a way that is in the line of thinking of Morbid, Michelle, softwarengineer, and some contributors at this site…

1. Roubini never looked that good. At least now he combs his hair. We dont come here because of his good looks, but his abilities.2. The market is rigged. GS program trading makes up half of the volume on most days. How do you explain an as-reported P/E of 130 during a recession? The market is going to tank.3. Unemployment, foreclosures, defaults are all increasing. State and federal revenue is decreasing. We are not even half way through this crisis. None of the fundamental causes of it have been fixed.4. I have made money every year for the last 3, mainly because of Roubini. I am now going entirely into cash, and using it to buy things of permanent utility, because of what is coming next.

Hey Arthur, remember, it’s not REAL money until you sell…paper profits are a narcotic for investors…they keep the herd happy until it’s time for the slaughter!

So George Bush was right? We just need to go shopping at Disney World!

Arthur, you’re obviously a glass half full kind of guy, but even Rome finally fell apart. It’s not always onward and upward. I just returned from the Niagra Falls, Buffalo area of upstate New York. An impoverished wasteland! Truly horrifying to drive through block after block of abandoned houses and commercial buildings, collapsing upon themselves. Adults riding bikes that look like they were stolen from children. Farmland abandoned and overgrown. Exhausted, unhealthy people sitting in their front steps in broken lawn chairs. Scary.I’m an optimist by nature, but I try to make my financial decisions based on the reality of what I see on a day to day basis. As the cheating husband said when his wife caught him in bed with another woman, “Who you gonna believe? Me or your lying eyes?” I believe my lying eyes.

There is also a significant problem with the “public enterprise” sector of the economy. My sister is a nurse in a medium security prison in AZ near the Mexican border. The ENTIRE county is dependent of state spending, which had been growing exponentially for years. Recently she lost her “shift differential pay” of about $100 a month (-$1200 per year), and was furloughed for 7 days (-$800+). This because it’s impossible to cut the hourly pay of state workers.She pointed out that almost everyone in the county is directly employed by the state (prison, school, police, etc.) or dependent on spending by these employees (food, gas, etc.).If the state tries to balance the budget by cutting these jobs, it worsens the state’s fiscal position because of loss of income tax revenue, loss of sales tax revenue, and increased costs for unemployment, food stamps, medicaid.She can’t figure out a solution. Neither can I. Can anyone here?

Arthur,Your point about American savings is completely wrong – they are not saving they are using extra monies to pay off debt – a mere $0.1 Trillion out of $14 Trillion at this point.Further your comment about China “that criminal regime” is nothing compared to the criminal elite in the USA – those criminal banksters, media and politicians who have hijacked the country. This GS business could really get the people here out in the streets it is so outrageous.

Sorry, you are right that there is a growing population of working poor that are being abused by the system. My point is that there is an ever growing number of people who are supported by a decreasing productive work force. All the police, prison guards, airport security, military, government workers of all kinds, and retirees, the growing numbers of disabled, even the homeless are all being supported by a shrinking number of productive workers. The debts stay the same or go up and the number of productive workers goes down. Tell me how this works out?What has been happening for a generation is that those who carry the load have fallen behind further and further and now can no longer carry the load, yet the government’s plan to fix the problem is to increase their burden? By transferring more and more of the wealth to a few elite banksters? Who are going to trickle it down to the working population via more loans? And this is going to foster a recovery?Delusional thinking at best! More likely a form of Institutional Insanity by people disengaged with the reality of the working productive class by years of privilege and sometimes generations of privilege. I see the decisions being made being similar to those of the privileged of 1700 and 1800 Europe. “Let them eat cake!”. Insanity IMHO.

http://theautomaticearth.blogspot.com/2009/07/july-17-2009-stop-bashing-goldman-blame.htmlStop bashing Goldman,blame yourselfRight, enough with the Goldman Sachs bashing. When everyone form Krugman to Huffington to the Wall Street Journal editors get in one the action, it’s time to step back, inhale, exhale and take another look. Sure, Goldman is a cabal bigger and more pernicious then the heads of all the Five Families, and without the code of honor to boot. They steal whatever they can, they cheat whoever they can and they’ll lie to their wives ten times on monday mornings, before breakfast.But that doesn’t mean they are the major problem. Once again, we’re getting it all wrong, in the same way we missed the mark complaining about $700 million in AIG bonuses against the backdrop of a thousand times that in Wall Street bailouts. Once you see what that adds up to, it’s not wonder that furor died quietly in the night, is it?Goldman Sachs can only get away with stealing, cheating and lying if they’re allowed to do so. There is a very obvious first line of defense against such actions, which should for all intents and purposes be illegal, and where they’re not yet, be made so yesterday. You all know who’s in that defensive line. You pay them. It’s what you call your government.If your government stubbornly and steadfastly refuses to -in order to stop the cheating and lying- apply the laws where they’re applicable, and change them where they need change, why would you expect Goldman to stop engaging in their favorite pastimes? Wouldn’t you agree that that is not wholly and entirely the smartest assumption to make?It’s not Goldman that fails. Goldman even does what it is by law required to do: maximize the returns for its shareholders. If it wouldn’t, its directors could be sued.It’s not Goldman, it’s the government that fails. The government looks after Goldman’s interests, bails them out with dozens of billions of dollars, most of which are never repaid, looks the other way when laws are broken, won’t change those laws that fail to protect the public etc. The list of where and when the government fails to protect the people who voted it in is so long, and so deep, that if we would take an afternoon to try and list all applicable points, we would by the end want to crawl into a deep dark corner in order to hide the deep dark red color of our cheeks.And I think that is why we won’t make that list, of how our governments fail us. We intuitively know where that would inevitably lead. That is, our own shame.Because we all know very well who put that government there, the Obama’s, the Geithners, Barney Franks, Chris Dodds and Nancy Pelosi’s.Blaming Goldman Sachs for your problems and your anger is nothing but a cheap diversion. Who did you vote for, and if it was the Democrats, what are they doing with their new found power? How is today different from 6 or 4 or 2 years ago? How different? Do you still believe in that change, or is it time to change your beliefs?Whatever you do, don’t blame Goldman. Don’t even blame Obama.Blame yourself. In the end, that’s the only way you can keep a grip on power. And on your life………………………………………But he forget to ask: What can you do to change this?

said Morbid to Arthur: Further your comment about China “that criminal regime” is nothing compared to the criminal elite in the USA – those criminal banksters, media and politicians who have hijacked the country.Ahem. Not only hijacked this country, the USA, but…well, here’s some actual history for Arthur to read. Read it, Arthur, and then let’s hear more of your ignorant and pathetic cheerleading about how the world needs even more Bloody American hegemony/imperialism.http://www.consortiumnews.com/2009/071409a.htmlThe CIA’s Ghosts of TegucigalpaBy Jerry MeldonJuly 14, 2009Billy Joya, security adviser to Honduras’s post-coup-d’etat President Roberto Micheletti, offered the following explanation for the armed forces’ June 28 insurrection ousting democratically elected President Manuel Zelaya:Joya said Zelaya had been following the same “Marxist-Leninist strategy” for tightening his grip on power that Chilean President Salvador Allende had in 1973 when Gen. Augusto Pinochet toppled Allende.At least, Joya is right about this much: The assault on Honduras’s fragile democracy was reminiscent of Pinochet’s 1973 putsch. But Joya’s justification says more about where he and Micheletti are coming from than it does about Zelaya, whose real offense was to run afoul of the Honduran oligarchs.The Organization of American States and United Nations have condemned the coup and demanded Zelaya’s reinstatement. But the Obama administration has been characteristically cautious, expressing displeasure and suspending military ties, but stopping short of economic sanctions that might lead to some second thoughts among the coup leaders.Does the White House’s chariness reflect fear that a reinstated Zelaya might take some revenge by releasing records revealing Reagan-era CIA collaboration with brutal Honduran generals and their drug kingpin partners?Does Obama prefer, as he does regarding George W. Bush’s disastrous presidency, to never look backwards even when the history involves serious crimes?Pleasing the PutschistsObama’s disinterest in history would please Micheletti and his fellow putschists, not least Billy Joya, who in the early 1980s was a captain in Battalion 3-16, a brutal Honduran intelligence unit that was trained and equipped by the CIA.A 1995 Baltimore Sun investigation of Reagan-era crimes documented the battalion’s use of shock and suffocation devices and its murder of 184 victims. The U.S. Embassy knew what was going on, but continued to work closely with Battalion 3-16’s leaders.The CIA got into bed with homicidal uniformed Hondurans because the Agency – Washington’s primary tool for achieving goals antithetical to American values – has always operated that way.Indeed, the story of how Nazi-like tactics spread across Latin America and other parts of the world can be traced back to the days just after World War II. Washington – in the name of “fighting communism” – recruited fugitive Nazi war criminals like SS Capt. Klaus Barbie, the Gestapo chief of Lyon, France, who escaped across so-called “rat lines” to South America and helped organize right-wing intelligence services.In those years, the newly formed CIA embraced not only ex-Nazis but their methods. Nazi war criminals smuggled to South America taught Nazi torture techniques to the region’s intelligence services.“Butcher of Lyon” Barbie did it in Bolivia. SS Col. Walter Rauff, developer of mobile gas vans and answerable for some 90,000 deaths during World War II, did likewise in Chile for Gen. Augusto Pinochet.The Carter-Reagan DivideBreaking with this collaboration in the late 1970s, President Jimmy Carter embargoed arms sales to South America’s more flagrant human rights violators. However, when Carter left the Oval Office, the old ways returned with a vengeance under Ronald Reagan.Even before the 1980 election, members of the ruling elite in Guatemala – where death squads had been operating with impunity for decades – were confident that Reagan’s victory would revive Washington’s holy war against communism.They were confident because two pillars of the American far right, Maj. Gen. John Singlaub, commander of U.S. forces in South Korea until Carter sacked him for insubordination, and retired Gen. Daniel Graham, a former senior official at the CIA who advised the Reagan campaign, had assured them.As if to underscore the message, the Republicans invited Guatemalan Mario Sandoval Alarcon, “Godfather” of Central American death squads, to Reagan’s inaugural ball.In the years that followed Guatemala’s bloodbath would get even bloodier where more than 100,000 would die. Ditto for El Salvador, where some 75,000 lives would be snuffed out as the CIA helped another right-wing military crush peasant and labor uprisings.In Nicaragua, the Reagan administration would go on the offensive because leftist Sandinista guerrillas had defeated the ruthless and corrupt Somoza dynasty in 1979, some 43 years after Washington had installed it.Determined not to let Nicaragua become another Cuba, the Reagan administration went to work countering the revolution by reorganizing the remnants of the Somoza dictatorship’s National Guard, which was blamed for slaughtering some 50,000 Nicaraguans in 1978 and 1979.In the early 1980s, Reagan hailed this ragtag army as “freedom fighters.” To the rest of the world, they were the “contras” and were widely regarded as drug-tainted terrorists. (In a private conversation with senior CIA officer Duane “Dewey” Clarridge, even Reagan accepted some of that reality, calling the contras “vandals.”)Death-Squad VeteransRight-wing Argentine intelligence units and the CIA began whipping the contras into shape in Honduras, which had the misfortune of bordering Guatemala, El Salvador and Nicaragua – the three hot spots for Reagan’s determination to draw a line against leftist gains in the region.Honduras would trade in its traditional “Banana Republic” moniker for “Pentagon Republic.”In establishing the contra operation, the CIA collaborated with Argentine instructors whose prior work had included organizing a “dirty war” that had tortured and killed tens of thousands of dissidents in Argentina.On March 17, 1981, President Reagan hosted Gen. Roberto Viola of Argentina, who was about to be sworn in as president. Extending the general his best wishes, Reagan promised Viola that he would lift the embargo that Jimmy Carter had imposed on U.S. arms sales to Buenos Aires.Though Argentina’s hand in training the contras is well known, its broader role in the CIA’s Central America “counterinsurgency” operations is not as well appreciated, nor is the price Hondurans paid for the fact that the Honduran Army officers with whom the CIA worked most closely made the murderous Argentines their role models.Initially, the Argentine dirty warriors taught Honduran soldiers and the contras how repression was handled in Buenos Aires, including, torture, high-profile assassinations and “disappearances,” the secret murder of political targets.According to J. Patrice McSherry, author of Predatory States, “Some of the Argentine officers involved were key Condor figures … Condor was extended to Central America.”What was Condor?In Operation Condor, South American intelligence teams joined forces to operate across borders to kidnap and assassinate their countries’ political exiles, essentially denying them safe haven anywhere in the world.That explained how corpses of Bolivian refugees would turn up in Buenos Aires garbage dumps in August 1974. One month later, in that same city, a car bombing claimed the lives of Chilean Gen. Carlos Prats and his wife. Prats had opposed the 1973 coup d’etat led by Gen. Pinochet that overthrew Chile’s progressive president, Salvador Allende.Despite release of historical documents about this right-wing international terror campaign, the mainstream U.S. media has devoted little attention to Operation Condor, in part it would seem because of the background roles of respected American leaders such as former CIA Director George H.W. Bush and ex-Secretary of State Henry Kissinger.A 1978 State Department document, discovered by Prof. McSherry in 2001, provides evidence that the U.S. government facilitated communication among the intelligence chiefs who were collaborating in Operation Condor.In the document, a cable from U.S. Ambassador to Paraguay Robert E. White to Secretary of State Cyrus Vance says Washington’s link to Condor might be exposed by an ongoing investigation into the Sept. 21, 1976, assassination of former Chilean foreign minister Orlando Letelier and his American colleague Ronni Moffitt in broad daylight in Washington, D.C.Letelier, like Prats, had been an outspoken critic of Chilean strongman Pinochet. And like Prats, Letelier was murdered in a car bombing that Pinochet’s intelligence agency, DINA, had assigned to Michael V. Townley, an American expatriate closely linked to CIA-trained anti-Castro Cuban exiles and European neo-fascist terrorists.Notably, George H.W. Bush was CIA director at the time of the Letelier murder and Agency informants had attended a meeting three months earlier at which the terror operations were discussed. Bush then helped stonewall the ensuing FBI investigation. [For details, see Robert Parry’s Secrecy & Privilege.]Disrupting the PeacePrior to the Argentines’ arrival in Honduras, the country had enjoyed relative peace, isolated from the violence across the country’s borders with Nicaragua, El Salvador and Guatemala. Soon, however, the Honduran police and armed forces would begin their own murderous campaign against a tiny group of domestic guerrillas and their suspected sympathizers.In 1979, Honduran chief of police Amilcar Zelaya Rodriguez formed the secret Grupo de los 14, a goon squad that specialized in the disappearance and torture of state enemies. After President Reagan and Vice President Bush took office in 1981, the violence in Honduras escalated.Gen. Gustavo Alvarez Martinez assumed control of Grupo de los 14. In Inside the League: The Shocking Expose of How Terrorists, Nazis, and Latin American Death Squads have Infiltrated the World Anti-Communist League, Scott and Jon Lee Anderson characterized the Honduran officer as follows:“General Alvarez did not invent Honduran paramilitary squads, but he was the man who streamlined them, integrated them into the armed forces, and allowed them to conduct a dirty war.”A vitriolic anticommunist who graduated from Argentina’s Colegio Militar in 1961, Alvarez would maintain contact with his instructors there, most notably Jorge Rafael Videla, who would head the Argentine junta during the Argentine dirty war’s bloodiest period.In addition, Alvarez received advanced training at Fort Benning, Georgia; Fort Bragg, North Carolina; and Fort Gulick in the Panama Canal Zone, where he attended the School of the Americas, known to critics as the “School of the Assassins.”With his ambition, ruthlessness and sleaziness, Alvarez was just the man the CIA was looking for. Alvarez had Grupo de los 14’s members undergo counterinsurgency training by U.S., Argentine and Chilean instructors. The group expanded over time and was renamed Batallion 3-16.One of the group’s instructors, Ciga Correa, had been a member of the Argentine Anti-Communist Alliance (“Triple-A”), a death squad that operated on the front lines of Argentina’s dirty war. One of his Triple-A missions was the 1974 Operation Condor assassination of Gen. Prats.In an offshoot of Operation Condor, Correa joined an Argentine unit in Guatemala City that targeted suspected Argentine guerrillas who had fled to Guatemala, El Salvador and Honduras.Under the tutelage of Correa and his associates, Alvarez’s thugs kidnapped, tortured, murdered and “disappeared” Honduran guerrillas and their supporters, whose numbers had swelled following the Sandinista triumph next door in Nicaragua.Flash Forward to 2001In 2001, Society of Helpers Sister Laetitia Bordes read that President George W. Bush planned to nominate John D. Negroponte to be U.S. Ambassador to the United Nations. At the time, she recalled a face-to-face meeting in 1982 with Negroponte in his office as U.S. Ambassador to Honduras.She had made the journey to ask a nagging question: What had happened to 32 women who had fled to Honduras to escape El Salvador’s death squads in the months following the March 24, 1980, assassination of Archbishop Oscar Romero in San Salvador?Sometime after arriving in Honduras, the women had been forcibly taken from their living quarters and shoved into vans, never to be seen again. Negroponte, who had worked closely with Gen. Alvarez, dissembled, disavowing knowledge of the women’s whereabouts and insisting that the U.S. Embassy kept its hands out of Honduran government affairs.Twelve years after that encounter, Sister Laetitia realized that Negroponte had lied to her. She read a Honduran Human Rights Commission report on the torture and disappearance of political prisoners. It specifically mentioned Negroponte’s complicity in human rights violations.In 1996, Sister Laetitia read a Baltimore Sun interview with Jack Binns, Negroponte’s predecessor in Tegucigalpa. Binns recalled that a group of Salvadorans, including the women about whose whereabouts Sister Laetitia had inquired, had been captured on April 22, 1981, tortured by members of the Honduran Secret Police, placed aboard Salvadoran military helicopters and, after taking off, thrown out of the helicopters.Binns added that U.S. authorities had been informed about the incident.The Honduran government eventually recognized 184 disappearances in that era: 39 Nicaraguans, 28 Salvadorans, five Costa Ricans, four Guatemalans, one American, one Ecuadoran, one Venezuelan and 105 Hondurans. Human rights organizations believe the numbers were considerably higher.(Ultimately, President George W. Bush selected Negroponte for a string of important assignments: U.S. Ambassador to the United Nations, Ambassador to Iraq, the nation’s first “Intelligence Czar” and, finally, in 2007, Deputy Secretary of State.)Military TurmoilIn early 1982, Honduran President Roberto Suazo Cordova promoted Negroponte’s sidekick, Grupo de los 14 leader Gustavo Alvarez Martinez, to the rank of general. Before the year was over, Alvarez had decimated Honduras’s tiny guerrilla movement and was promoted to Commander in Chief of the Armed Forces.The appointment bred resentment in more senior officers – and as Hondurans grew fed up with their country’s exploitation by Washington as a base for the Nicaraguan contras, the resentment among Gen. Alvarez’s enemies grew.The boil burst in March 1984, when Honduran Air Force commander Gen. Walter Lopez Reyes spearheaded an internal military coup that drove Alvarez into exile in the United States. The violence in Honduras soon tapered off.CIA Tegucigalpa station chief Donald Winters, who had asked Alvarez to be the godfather to his adopted daughter, was reassigned elsewhere.Meanwhile, the contras – a brutal and ineffective fighting force – were becoming a headache for the White House. Reports of the CIA mining of Nicaragua’s harbors and a CIA training manual that sanctioned the assassination of civilians undermined support for Ronald Reagan’s Central American proxy wars.Anticipating congressional cutoff of funding for the contras, the White House convened a National Security Planning Group meeting on June 25, 1984. The meeting was marked by heated debate about whether seeking third-country support for the contras would expose President Reagan to impeachment.Vice President Bush asserted that soliciting the contra aid would be lawful unless the United States promised to give the third parties something in return. Nonetheless, Reagan personally approved, with Bush’s active involvement, special aid for Honduras as an implicit quid pro quo for helping the contras.According to the minutes of a Feb. 7, 1985, meeting of high-level Reagan administration officials, which were released at the later trial of Reagan’s point man for the contras, Lt. Col. Oliver North, the “principals agreed … to provide several enticements in exchange for … continued support” of the contras.Twelve days after the meeting, Reagan released millions of dollars in economic aid to Honduras.The Drug ConnectionThe Reagan administration also did what it could to protect its Honduran friends who ran afoul of the law.On Nov. 1, 1984, the FBI arrested eight men in Miami and charged them with plotting to overthrow the Honduran government and assassinate President Suazo. The alleged aim of the scheme, which was financed by $40 million in cocaine profits, was to reinstate Gen. Alvarez as Chairman of Honduras’s Joint Chiefs of Staff.The Honduran government asked Washington to hand over Alvarez, but he remained safe within U.S. borders, even benefiting from a $50,000 Pentagon contract for a six-month study of “low-intensity conflict” in Central America.Alvarez also reportedly spent time as the house guest in Miami of international arms trader Gerard Latchinian, one of the richest men in Honduras, where he was known as the “ambassador of death.” Latchinian got 30 years in prison for his role in the drug-financed coup/assassination plot.What made the stench even worse was Washington’s treatment of Alvarez’s chum, Gen. Jose Bueso-Rosa. Bueso had served as Army Chief of Staff and was an avid supporter of the contras until Alvarez’s March 1984 ouster – following which Bueso was demoted to military attaché in Santiago, Chile.For his role in the assassination plot, Bueso turned himself in to federal authorities in Miami. In June 1986, he pleaded guilty to two federal counts of “traveling in furtherance of a conspiracy to plan an assassination” and was sentenced to five years at a minimum security prison.The light sentence must have been related to Oliver North’s appeals to State and Justice Department officials for intervention on Bueso’s behalf. Two U.S. government officials, one serving and one retired, testified as character witnesses at Bueso’s sentencing hearing, and the Reagan administration submitted an appeal for leniency that read in part:“General Bueso-Rosa has always been a valuable ally to the United States. As chief of staff of Honduras’s armed forces he immeasurably furthered U.S. national interests in Central America. He is primarily responsible for the initial success of the American military preserve in Honduras. For this service he was awarded the Legion of Merit by the President of the United States, the highest award that can be presented to a foreign military officer.” [See Scott and Marshall’s Cocaine Politics.]Reagan also had awarded the Legion of Merit to Gen. Alvarez.‘Lenient’ SentenceThe presiding judge decided that the additional information trumped the Justice Department’s description of the assassination conspiracy as “the most significant case of narco-terrorism yet discovered.” A senior Justice Department official called the five-year sentence meted out to Bueso “lenient.”But it wasn’t lenient enough for Oliver North. As authors Peter Dale Scott and Jonathan Marshall reported, North sent a note to his then boss, National Security Adviser John Poindexter, saying there remained one “problem.”The general was the man with whom North and three other senior U.S. officials had “worked out arrangements” for contra support, and Bueso had entered a guilty plea on the assumption that he would be given time at a minimum security prison “for a short period [days or weeks] and then walk free.”“Our major concern,” North wrote, “is that when Bueso finds out what is really happening to him, he will break his longstanding silence about the [contras} and other sensitive operations.” [Emphasis added.]North and some of his colleagues were therefore going to “cabal quietly … to look into options: pardon, clemency, deportation, reduced sentence. Objective is to keep Bueso from feeling like he was lied to in legal process and start spilling the beans.”Poindexter reassured North: “You may advise all concerned that the President will want to be as helpful as possible to settle this matter.” In the end, the Justice Department blocked clemency or deportation, and Bueso-Rosa served his time and kept his mouth shut.But the late 1984 timing of Bueso’s drug-financed assassination plot suggests that it may have been one of those other sensitive operations that Oliver North cagily referred to in his note to Poindexter. The Honduran general’s drug/assassination conspiracy may have been part of the Reagan administration’s elaborate plans to sustain the contras.A revitalized Honduran connection would have guaranteed Tegucigalpa’s crucial support. The coup’s failure led to Plan B: economic leverage with President Suazo. And because a congressional ban on aiding the contras, known as the Boland Amendment, made that impeachable, it became a top priority to conceal Reagan’s and Bush’s roles.The Bush family name was further protected by President George H.W. Bush’s Christmas Eve 1992 pardons to six key Iran-Contra defendants, including former Defense Secretary Caspar Weinberger. To save his own skin, Weinberger was expected to incriminate Bush in the Iran-Contra cover-up.Bill Clinton’s opposition to the Iran-Contra investigation when he assumed the presidency in 1993 also helped spare Bush from having to answer a new round of questions from special prosecutor Lawrence E. Walsh.Walsh’s truncated investigation had touched on – but failed to pursue – the contra-cocaine aspect of the Iran-Contra Affair, of which the Bueso-Rosa/Latchinian conspiracy was just the tip of a narcotics-filled iceberg.Consortiumnews.com’s Robert Parry, the late Gary Webb and others – with no help, indeed with resistance from the New York Times, Washington Post and Los Angeles Times – have painstakingly established that the contras were the beneficiaries of and in some cases in cahoots with drug traffickers. [For details, see Parry’s Lost History.]Digging DeeperSo let’s delve a bit further into the Honduran Connection.A 1983 US Customs report noted that the Honduran cargo firm SETCO Air was headed by Juan Ramon Matta Ballesteros, a Class I DEA violator in partnership with “American businessmen who are … smuggling narcotics into the United States.”Six years later, the U.S. Senate Subcommittee on Terrorism, Narcotics and International Operations, headed by John Kerry, D-Massachusetts, issued a multi-volume report, “Drugs, Law Enforcement and Foreign Policy.”The report noted, among other sensational findings, that SETCO Air was “the principal company used by the Contras in Honduras to transport supplies and personnel for the FDN [Nicaraguan Democratic Force], carrying at least a million rounds of ammunition, food, uniforms and other military supplies for the Contras from 1983 to 1985.”In other words, unfazed by the 1983 Customs report that had identified Matta Ballestero as a Class I violator – which meant drug kingpin, top of the food chain – the Reagan administration retained his airline for another two years as the contra’s chief mover of supplies.Yet what makes Matta’s case special is just how far Washington would go to keep him in business. In 1970, Matta marked himself as a big-time trafficker when he was arrested at Dulles Airport outside Washington for importing 54 pounds of cocaine. But he was sentenced to five years at a minimum security prison, and a year later he tiptoed out the door and didn’t come back.By 1973, the DEA considered Matta important enough to entrap in a sting operation. But either the narcs blew it or someone told them not to try.Two years later, the DEA learned that Matta had teamed up with Mexican drug kingpin Miguel Angel Felix Gallardo, a tonnage supplier to El Norte with Colombian and Peruvian connections. The partnership would make Matta a billionaire.A 1978 DEA intelligence report cited by James Mills in his penetrating study, The Underground Empire, noted that Matta had financed a coup d’etat in his native Honduras that was led by his partner, Gen. Policarpo Paz Garcia.Transfer PointEven before that coup, Honduras had been the transfer point for half a billion dollars worth of northbound drugs. In the three years following the coup, Matta Ballesteros and President Paz Garcia made Honduras an even bigger cocaine trafficking center.As Scott and Marshall note in Cocaine Politics, when these events unfolded, Jimmy Carter was in the White House and it was his administration that overlooked Matta Ballesteros’s behind-the-scenes role in Honduran politics.However, unlike the Carter administration, the incoming Reagan team didn’t simply turn a blind eye. It found Honduras’s corruption an ideal environment for nourishing the contra war.Matta’s number one Honduran government enabler after President Paz was Col. Leonidas Torres Arias, the head of military intelligence and a key figure in making the necessary arrangements for opening contra training camps.In August 1981, Col. Torres met secretly in Guatemala City with Argentine intelligence officer Mario Davico, the CIA’s Duane “Dewey” Clarridge, Honduran Gen. Alvarez Martinez and President Paz Garcia.A tripartite agreement emerged for waging the contra war on Nicaragua. Argentine intelligence would handle organization, administration and training; the CIA would supply the funds; and Honduras would provide the territory for operational bases.At the time, Davico was second in command of Argentine Army Intelligence and a graduate of the U.S. Army’s School of the Americas. He would soon relocate to Honduras to teach Alvarez’s Batallion 3-16 the Argentine “dirty war” techniques of arbitrary detention, torture, extrajudicial executions and disposal of cadavers.All three Hondurans – Torres Arias, Alvarez Martinez and Paz Garcia – were considered to be in the pockets of the drug lords. As Scott and Marshall put it: “The CIA relied totally on the cocaine-trafficking military in Honduras to back its plans to overthrow the Sandinista regime in Nicaragua.”But concerns about drug trafficking did little to dissuade the Reagan administration from teaming up with the Honduran military. That, however, meant that the CIA and Drug Enforcement Administration would be operating at cross purposes.The DEA agent in charge of its recently opened Tegucigalpa office, Thomas Zepeda, had documented the complicity of Col. Torres Arias and other high-ranking Honduran officers in Matta Ballesteros’s drug operations.But DEA needed the Honduran military’s assistance to arrest Torres and his cronies, and the CIA needed them to support the contras. To avoid a showdown with the CIA, the DEA’s Zepeda proposed that a grand jury be empanelled to investigate corruption in the Honduran armed forces.But the CIA nixed the idea, no doubt to protect its collaborators. As one high-level diplomat later noted: “Without the support of the Honduran military there would have been no such thing as the contras. It’s that simple … So they got rid of the DEA station.”The DEA Tegucigalpa station was shut down – in June 1983, just as the CIA station was doubling in size – in a naked move to preclude a serious drug investigation. That same month, Customs asked Zepeda to investigate Matta’s airline, SETCO, which would soon be flying supplies to the contras.Brutal MurderBut the worst was still to come. Shortly after noon on Feb. 7, 1985, DEA undercover agent Enrique (Kiki) Camarena walked out of the U.S. consulate in Guadalajara, Mexico for a lunch date with his wife.Two Jalisco state policemen, two hired killers and a drug lord’s lieutenant drove up alongside, told Camarena “the commandante wants to see you,” and shoved him into their car. They sped to a house that was owned by drug kingpin Rafael Caro Quintero.Camarena was questioned and tortured there for the next 30 hours. His interrogator, a captured tape would reveal, was a commander in the Federal Security Directorate (DFS), Mexico’s FBI. One month later, Camarena’s mutilated body was discovered next to that of his Mexican pilot.First it was assumed that the motive for the murders had been raids Camarena had led on vast marijuana plantations, which had cost Cara Quintero and his partners an estimated $5 billion. But the interrogation, it turned out, focused on what Camarena knew about corruption in Mexico’s political hierarchy.That would explain why the men who attended the meeting at which Camarena’s abduction reportedly included future Mexico City police chief Javier Garcia Paniagua, and Manuel Ibarra Herrera, the former head of Mexico’s Federal Judicial Police.That same year, Newsweek would describe another attendee as the “boss of bosses of Mexico’s cocaine industry,” a man whose organization was believed to supply “perhaps one third of all the cocaine consumed in the United States.”A DEA agent described the man as “the kind of individual who would be a decision maker of last resort. He is at the same level as the rulers of Medellin and Cali cartels.” That man was Juan Ramon Matta Ballesteros, and at the planning meeting he reportedly announced “we will soon have the identity” of the DEA agent and he will be silenced.Matta Ballesteros kept his promise. Camarena was silenced. The method, a forensic specialist determined, was the application of a Phillips-head screwdriver to the skull.Hair sample analysis would establish Matta’s presence at the silencing. But it was only in 1990 that federal prosecutors in Los Angeles would finally put Matta away for life for cocaine trafficking, racketeering and conspiracy.Significantly, a witness in the Camarena murder case told the DEA that the CIA had trained Nicaraguan contras on a ranch near Veracruz that was owned by Rafael Caro Quintero, the same drug kingpin who owned the house outside Guadalajara where Enrique Camarena was murdered.Matta would be arrested in 1986 in Colombia. But he bought his way out of jail with a $2 million bribe and made his way back home to Honduras. That same year, which was three years after Customs had identified Matta as both a Class I DEA violator and the owner of SETCO Air – and after Matta had become a prime suspect in the Camarena murder – the State Department renewed SETCO’s contract to supply the contras.For two more years Matta would live in luxury in Hondruas, seemingly unconcerned by any prospect of arrest since he still had many friends in high places. His generosity would endear him with Honduras’s abjectly poor masses. They called him Honduras’s “Robin Hood.”But in March 1988, after the Iran-Contra scandal had devastated political support for the contra war in Washington, a truce was declared in Nicaragua. That eliminated Washington’s use for Honduras, and its need for drug kingpins like Matta and his partner, Mexican drug kingpin Felix Gallardo, who once told a DEA informant that he was “protected” because his drug profits were bankrolling the contras.Only then were Felix Gallardo and Matta Ballesteros arrested and flown to the United States.Belated ProbeWhen CIA Inspector General Frederick Hitz belatedly investigated the contra-cocaine connection in the late 1990s, he documented the depth of CIA knowledge of drug traffickers and money-launderers connected to the contra war – and explained the key reason for protecting these criminals.According to Hitz’s report, the CIA had “one overriding priority: to oust the Sandinista government. … [CIA officers] were determined that the various difficulties they encountered not be allowed to prevent effective implementation of the contra program.”One CIA field officer explained, “The focus was to get the job done, get the support and win the war.”The CIA’s manipulation of Honduran politics in pursuit of that goal was another part of the contra war’s legacy.Besides the drug lords, other key players also ran afoul of the law or met their own rough justice.The Argentine military junta self-imploded in the wake of the disastrous 1982 war with Great Britain over the Falklands/Malvinas islands, leading to a restoration of civilian rule and a judgment by an Argentine court denouncing the military government for genocide and other crimes against humanity.Reagan’s guest, Gen. Viola, was sentenced to 17 years in prison.Honduran Gen. Alvarez Martinez returned to Honduras in 1987 and was silenced by an assassin on Jan. 25, 1989.The CIA’s Clarridge was indicted for perjury and lying to Congress in the Iran-Contra scandal but was pardoned by President George H.W. Bush on Christmas Eve 1992.But the ghosts of Tegucigalpa continue to hover over Honduran politics. As Hondurans protest the ouster of President Manuel Zelaya, many believe that Washington encouraged and supported the coup. Can anyone blame them?They haven’t forgotten that during the Reagan era, the CIA and Argentine dirty warriors ran roughshod over their country. They also know that Roberto Micheletti’s security adviser, Billy Joya, was a member of one of those Reagan-era death squads.They know, too, that Zelaya had been bucking Honduras’s powerful upper class with reforms like a 60 percent minimum wage increase and rejecting Washington’s “free trade” policies. Zelaya also challenged U.S. foreign policy by befriending Cuba’s Fidel Castro and Venezuela’s Hugo Chavez.However badly President Barack Obama may want to look forward not backwards, Washington’s unacknowledged crimes of the past few decades keep intruding on the present.Jerry Meldon is an Associate Professor in the Chemical and Biological Engineering Department at Tufts University, Medford, Massachusetts. Dedicated to the memory of Penny Lernoux.

What a washwoman – you are all over the map, it’s easy to sit on the fence. I do hope you are right about the future, but until you come live here for a while and see what is going on, no one here will take you seriously. Its not always about the Stocks and the markets. As Geust said above, I’ll just pass you by here from now on.

All I know is that the storyline of life is filled with unexpected plot turns that, in retrospect seem completely predictable (to a few). Me, I’m betting on global pandemic to help cut Co2 emissions and reset the clock. Maybe Shaker philosophy will be resurrected. Maybe future will look so scary that reproduction falls off a cliff in developed countries with access to birth control. Maybe Pakistan looses track of a few nukes, Kim Jung Joke gets itchy trigger finger, category 5 hurricane takes out entire east coast, Miami to Boston, in one week. Who knows?The future has ALWAYS looked grim to anyone with a lick of sense, and it will end the same way for each and every one of us.I say we should enjoy what we can, while we can, until we can’t. Otherwise, go blow your brains out and free up resources for those who still want ‘em.

Wow.So the CIA is….the antichrist?

I can only tell you that, because of the Prof, I still have my retirement, for which I will always be grateful.

Oh, sweetie, it’s so nice to see you again, Free Tibet. I understand what you’re saying: that we have to somehow stop jawboning and Get Busy.I am one of those who is simply paralyzed since I have no capital to speak of to invest anywhere these days. If I could, I’d take a couple thousand dollars and put it somewhere that I thought it’d do some good. But where? Where can I be safe? I rather think many of us Average Folks are just standing back watching the train coming down the tracks, bearing down upon us all, and we are powerless to stop it. We’re not at the helm, as it were.So the only thing we can do is find a place to express our fears, here, on this blog. We can’t fight Goldman-Sachs or CITI or Bernanke or Geithner.And since I’ve never aspired to own a McMansion or go on a vacation to the Bahamas, I’ve already done the mental gymnastics necessary to adjust to the New Economy of Lowered Expectations. The worst part of it for me is, fear of the majority who keep voting in the clueless creeps in Congress, Repubs and Dems alike. So We The People have no representation in our own government. We do not have a voice at the table. We’re at the mercy of those whose interests do not match our own. And we are our own worst enemy. Whichever of our founding fathers said (and I’m paraphrasing here) “here’s your democratic republic; good luck keeping it,” was absolutely right. We have lost it. In more ways than one.

Hi Arthur, I hope you feel better soon.

Better get some of that cheap Australian red wine down your throat and get the ticker re-oiled! We need you healthy to take on the negative hordes.

negative hordes???at least were not the rich’es whores

“…this country allows us to bring that dream to fruition.”Are you kidding? PLEASE DEFINE “US”…because the America I’M living in ACTIVELY PREVENTS dreams coming to fruition, except for the dreams of those fraction few at the top.

One out of every 6 people on this planet is now going hungry.1 in six humans going hungry NOWbut hey don’t worry be happyyour head-in-the-sandism will surely save you – right?

Of course we can blame whoever we please. I blame Clinton because his zipper problem led directly to 8 years of Commodus. The current figurehead is hard to figure out, but I suspect he’s quite happy that Goldman is running the show. What is the real problem? Yes, we the people vote for these clowns, but they are what is trundeled out before us at election time. We are forced to vote for the lesser of two evils in every presidential election. I never like the candidates I’m forced to decide between, does anybody?Personally, I think the US is too big to work. It was suggested above that more power could devolve to the states. Perhaps the country should be broken up into autonomous regions. At the same time, admitting I might be mistaken or at least oversimplifying, I really believe Americans in general like stupidity. That’s the essential problem in my opinion. Enough said.

I like Woody Allen films too. Have you seen his latest with Larry David, “Whatever Works”? Same philosopy as you exactly.

“Spot on Morbid about the savings rate. When they say it hit over 6%, they include in that number people paying down debt. Cash in banks or under the mattress is not increasing.Reply to this comment By MM CA on 2009-07-18 09:22:44more likely, defaulting on debt

No, it doesn’t. Malthusianism is just one more variety of head-in-the-sandism. Malthusians fail to see the whole picture, so they mis-think that what is actually manufactured scarcity is inevitable and resource-based. Malthusians suffer from confused ideas.

UNCONTROLLED GROWTH, WAGE DETERIORATION AND WATER SHORTAGEI’ll just center on water shortage in America; but we all know its extinct animal species, dead zones in our surrounding geographic water, clogged infrastructures, etc, etc….causing wage deterioration with no more unlimited resources to suck from in Amrica.America used to be the Bread Basket of the world and that taxed its water supplies when we had 200M people, now we have 400M? Today, we must import food to feed the uncontrolled growth.An environmental uncontrolled population growth news article states in part:”…Water shortages, which used to be limited to the dry western states, now plague just about the entire United States. Even regions that once seemed to have limitless supplies of water are facing predictions of shortages and imposing water restrictions on residents.The Associated Press reported in October 2007 that, “An epic drought in Georgia threatens the water supply for millions. Florida doesn’t have nearly enough water for its expected population boom. The Great Lakes are shrinking. Upstate New York’s reservoirs have dropped to record lows.”..”The rest of the news URL:http://www.scrippsnews.com/node/44612Did you know that when water is scarce we have to dig/pump that much deeper to find the last drops of potable water with more concurrent more alleged global warming oil consumption, adding to the economic collapse fire?Tell me clearly now, how do you see wages going up in this current uncontrolled growth economic mess with more and more people competing for a dwindling jobs base; that to quote Obama, partially isn’t comin’ back? Especially assuming Dr. Roubini’s GNP figures for 2009/2010 come true.I had one New Democrat type tell me, “Americans just need to work 20-30 hr weeks [many of the severly underemployed in America are doing this already IMO] and share their jobs/incomes with the new population growth”….LOL, that will really destroy our tax base and real estate prices too. Its horrifying wage deterioration too.

I have thought a lot about this debt thingy, and I see what is happening to the little guys at street level. It gets worse by the day.The recent Atlanta Gift Show was a bust for most, and it followed a disastrious Dallas market in June. All the Home Furnishings trade shows have been dropping like a rock, as have the shows for many other consumer goods. Less traffic, smaller orders.Unless you have been involved with multiple independent merchants – the Mom & Pop stores – you probaly have no idea what has happened over the past 6 to 7 years in regards to credit and how it is used. Until relatively recently, stores came to market with a stack of credit sheets with their banking info, references, and with the understanding that additional financial info may be required before a vendor shipped their order. Needless to say, this was a somewhat cumbersome part of the process, BUT it worked quite well and actually kept the vendor/customer relationship honest and tight.Then the credit card industry arrived on the scene, and everything changed. Establish a credit line with us, they said. Streamline and simplify your life by consolidating everything on to one statement. Oh, and by the way, you can earn points for lots of “free” goodies, travel, and vactions!And it worked! It was beautiful. Stores loved it, vendors loved it, reps like me loved it. It made life so much easier. The stores especially loved the points, and it was a great deal for those who could wisely manage the credit…and as long as the cash flow was there.Now, many Mom & Pops have become dependent on credit cards to run their business. And I don’t mean the kind of credit lines most families have. I mean lines like $500K & more. Large numbers of them have lost the direct credit they had with each individual supplier, and many of them dealt with CIT.Main Street Merchants are in deep trouble, folks, and these are the backbone of American communities. They have to figure out how to service current debt with their declining sales and margins, all the while strugling to finance current purchases with reduced credit lines. Never mind trying to guess what their customers will be buying in the second half of the year and what the proper inventory levels should be…or what they can afford for them to be.In fact, for many Main Street Merchants, the question in their head is wether or not to even bother. Is tying up your remaining cash/credit in inventory really the wise thing to do when you feel all you have worked so hard for slipping through your fingers. Just look around at all the empty store fronts now and think about how many there will be in another year.So, back to the debt thingy. What happens if Main Street simply decides to declare their own “Jubilee”? What if HUGE numbers of businesses and individuals simply stop paying the bills? At that point, what does a credit rating actually mean? Who can get a judgment, and who is going to enforce one? What happens to the court system if the citizens tell the banks “sue me”, then try to collect.Curious minds want to know.Independent Contractor

Its all in good fun here, Arthur. I would not wish ill health on anyone. Get better, and come back to take your lumps.

Pointedly well said, G. All of it.I’m halfway through Noam Chomsky’s “Deterring Democracy.” It’s hard to argue with the facts. This kind of shenanigans goes back decades and decades. Chomsky certainly draws back that curtain. And just goes to show how brainwashed We The People are, how dumbed-down. Education today? Fuhgeddaboudit. Well-informed populace? Nonexistent. Democracy? Only in your dreams.

It’s certainly possible, IC. I never would have thought, a year ago, that the Great American Consumer, too-credit-card-dependent-to-fail, would shut their collective wallets, and look at what happened when they did. And, effectively 50 million of us have Just Said No to health care insurance premiums, copays, and deductibles simply out of sheer necessity. We have to eat, after all.We The People can no longer service our debts. But TPTB are still trying to blow up the housing bubble. Refinance into a 40-year mortgage? You’ve got to be kidding me.It has to be coming to a point where we Average Joes no longer feel ashamed to just walk away. If everyone else is doing it. . . well, you know. Morality be hanged. Because, you see, there is no moral imperative anymore. There’s no integrity anymore, certainly not from our highfalutin’ financial wizards who are so carefully husbanding our 401(k)s. Or our erstwhile elected representatives who are so carefully watching out for our civil liberties.We had a poster here who went by the handle of Jubilee a while back. Are ya still out there?

If your theory is correct, then I suspect we’d have a LOT more good state legislators. Ever watched your state senators & representatives in action?Ever been to a real New England town meeting? There aren’t enough informed, intelligent people to outweigh dolts, and nothing is going to change until the cable is off for more than 24 hours and we run out of Cheetos and beer.

The curious part of this “WAR” solution is that over this last 30 years “Science and Technology”has taken over as well.(A much higher proportion of every countries military now goes into high tech equipment,instead of “Manpower”)It,s no longer very efficient in lowering unemployment by starting a “Friendly” little war somewere ‘So a real dilema behind the scene.In todays wars you find the cost of a front line soldier costing between $500,000 and $650,000 per year.I was struck by the Canadian example in Afganistan,where if Canada had the same contribution in manpower as the First World War ,the numbers would be 300,000 and not the 2,500 or so.Realistically the War solution for Economics doesnt work anymore,for Western Countries.The last eight years showed an annual huge war deficit at the Federal level,with no real economic gains as in the Second World War.Now what do we do ???

Roubin on cnbc closing bell this coming monday for nayone interested.

you are sick and delusional. check in with a doctor before you hurt someone. you mean, people voted for Bush for last 8 year, and now voted incompetent Obama, Pelosi, and Geithner clown and bozo are my fault to blame? man, you need a reality check.

Privatizing the public sector is a way of diverting public money into private hands. The private contractors who lobby for the contracts are seeking to control pre-existing infrastructure, built by and for the public, for rent seeking. Unlike the government, private contractors want to use the pre-existing infrastructure for profit, without having to build anything from the ground up.

I’m coming to the belief that none of this matters any more. The stage is set. The players have staked out their positions and refuse to change their minds or their positions. What is going to happen is going to happen and there is absolutely nothing any of us are going to do about any of it.. All we can do is try and protect ourselves and our families to the best of our abilities. And in the end that will be less than adequate IMO.I am beyond sorry for the US. I am belyond sad for us. I am concerned about the survival of what was once the best hope for the world. Our Constitutional Republic. It appears to be over and the Sheeple are being sheared and put in the truck for the slaughter house.

Fiscal ruin of the Western world beckonsFor a glimpse of what awaits Britain, Europe, and America as budget deficits spiral to war-time levels, look at what is happening to the Irish welfare state.By Ambrose Evans-PritchardPublished: 5:40PM BST 18 Jul 2009Events have already forced Premier Brian Cowen to carry out the harshest assault yet seen on the public services of a modern Western state. He has passed two emergency budgets to stop the deficit soaring to 15pc of GDP. They have not been enough. The expert An Bord Snip report said last week that Dublin must cut deeper, or risk a disastrous debt compound trap.A further 17,000 state jobs must go (equal to 1.25m in the US), though unemployment is already 12pc and heading for 16pc next year.Britain’s prized AAA rating under threat as S&P issues stark warningEducation must be cut 8pc. Scores of rural schools must close, and 6,900 teachers must go. “The attacks outlined in this report would represent an education disaster and light a short fuse on a social timebomb”, said the Teachers Union of Ireland.Nobody is spared. Social welfare payments must be cut 5pc, child benefit by 20pc. The Garda (police), already smarting from a 7pc pay cut, may have to buy their own uniforms. Hospital visits could cost £107 a day, etc, etc.”Something has to give,” said Professor Colm McCarthy, the report’s author. “We’re borrowing €400m (£345m) a week at a penalty interest.”No doubt Ireland has been the victim of a savagely tight monetary policy e_SEmD given its specific needs. But the deeper truth is that Britain, Spain, France, Germany, Italy, the US, and Japan are in varying states of fiscal ruin, and those tipping into demographic decline (unlike young Ireland) have an underlying cancer that is even more deadly. The West cannot support its gold-plated state structures from an aging workforce and depleted tax base.As the International Monetary Fund made clear last week, Britain is lucky that markets have not yet imposed a “penalty interest” on British Gilts, given the trajectory of UK national debt – now vaulting towards 100pc of GDP – and the scandalous refusal of this Government to map out any path back to solvency.”The UK has been getting the benefit of the doubt, both in the Government bond market and also the foreign exchange market. This benefit of the doubt is not going to last forever,” said the Fund.France and Italy have been less abject, but they began with higher borrowing needs. Italy’s debt is expected to reach the danger level of 120pc next year, according to leaked Treasury documents. France’s debt will near 90pc next year if President Nicolas Sarkozy goes ahead with his “Grand Emprunt”, a fiscal blitz masquerading as investment.There was a case for an emergency boost last winter to cushion the blow as global industry crashed. That moment has passed. While I agree with Nomura’s Richard Koo that the US, Britain, and Europe risk a deflationary slump along the lines of Japan’s Lost Decade (two decades really), I am ever more wary of his calls for Keynesian spending a l’outrance.Such policies have crippled Japan. A string of make-work stimulus plans e_SEmD famously building bridges to nowhere in Hokkaido e_SEmD has ensured that the day of reckoning will be worse, when it comes. The IMF says Japan’s gross public debt will reach 240pc of GDP by 2014 e_SEmD beyond the point of recovery for a nation with a contracting workforce. Sooner or later, Japan’s bond market will blow up.Error One was to permit a bubble in the 1980s. Error Two was to wait a decade before opting for monetary “shock and awe” through quantitative easing.The US Federal Reserve has moved faster but already seems to think the job is done. “Quantitative tightening” has begun. Its balance sheet has contracted by almost $200bn (£122bn) from the peak. The M2 money supply has stagnated since January. The Fed is talking of “exit strategies”.Is this a replay of mid-2008 when the Fed lost its nerve, bristling over criticism that it had cut rates too low (then 2pc)? Remember what happened. Fed hawks in Dallas, St Louis, and Atlanta talked of rate rises. That had consequences. Markets tightened in anticipation, and arguably triggered the collapse of Lehman Brothers, AIG, Fannie and Freddie that Autumn.The Fed’s doctrine – New Keynesian Synthesis – has let it down time and again in this long saga, and there is scant evidence that Fed officials recognise the fact. As for the European Central Bank, it has let private loan growth contract this summer.The imperative for the debt-bloated West is to cut spending systematically for year after year, off-setting the deflationary effect with monetary stimulus. This is the only mix that can save us.My awful fear is that we will do exactly the opposite, incubating yet another crisis this autumn, to which we will respond with yet further spending. This is the road to ruin.

Obama is a wolf in sheep’s clothes he’s really a neo-con putting free market idealism before hungry people- he should be hung!

I sure won’t argue the intelligence ratios, and there are plenty of concerned citizens with more mouth than information.On the other hand, I really do believe we would get a better class of candidates if the financial bar were lowered – dramatically. There are so many really good people whose voices never get heard, but they are the local worker-bees at the civic/volunteer level, with great ideas, experience, and reputations in the commmunity. The way the game is played now, not only do most not qualify financially, most don’t care to be reviled when the other side goes into atack mode with their special interest money.It’s little woder we get the crap we do for candidates, is it?Independent Contractor

Paulson reveals private conversations with US Congress and his concerns of breakdown in law and orderBy Stephen Foley in New York, Friday, 17 July 2009The Bush administration and Congress discussed the possibility of a breakdown in law and order and the logistics of feeding US citizens if commerce and banking collapsed as a result of last autumn’s financial panic, it was disclosed yesterday.Making his first appearance on Capitol Hill since leaving office, the former Treasury secretary Hank Paulson said it was important at the time not to reveal the extent of officials’ concerns, for fear it would “terrify the American people and lead to an even bigger problem”.Mr Paulson testified to the House Oversight Committee on the Bush administration’s unpopular $700bn (£426bn) bailout of Wall Street, which was triggered by the failure of Lehman Brothers last September. In the days that followed, a run on some of the safest investment vehicles in the financial markets threatened to make it impossible for people to access their savings.Paul Kanjorski, a Pennsylvania Democrat, asked Mr Paulson to reveal details of officials’ concerns, which were relayed to Congress in hasty conference calls last year. The calls included discussion of law and order and whether it would be possible to feed the American people, and for how long, according to Mr Kanjorski.”In a world where information can flow, money can move with the speed of light electronically, I looked at the ripple effect, and looked at when a financial system fails, a whole country’s economic system can fail,” Mr Paulson said. “I believe we could have gone back to the sorts of situations we saw in the Depression. I try not to use hyperbole. It’s impossible to prove now since it didn’t happen.”The Oversight committee is investigating the takeover of Merrill Lynch by Bank of America, a deal forged in the desperate weekend that Lehman Brothers failed, and which later required government support because of Merrill’s spiralling losses.Mr Paulson defended putting pressure on Bank of America when it had last-minute doubts about the deal in December. Not to have done so could have rekindled the “financial havoc” the bailout had calmed.What Paulson tells the public at the time…

“America is a strong nation. We are a confident and optimistic people. Our confidence is born out of our long history of meeting every challenge we face. Time and time again our nation has faced adversity and time and time again we have overcome it and risen to new heights. This time will be no different……President Bush has directed me to consider all necessary steps to restore confidence and stability to our financial markets and get credit flowing again. Ten days ago Congress gave important new tools to the Treasury, the Federal Reserve and the FDIC to meet the challenges posed to our economy. My colleagues and I are working creatively and collaboratively to deploy these tools and direct our powers at this disruption to our economy.Today we are taking decisive actions to protect the US economy. We regret having to take these actions. Today’s actions are not what we ever wanted to do – but today’s actions are what we must do to restore confidence to our financial system……While many banks have suffered significant losses during this period of market turmoil, many others have plenty of capital to get through this period, but are not positioned to lend as widely as is necessary to support our economy. Our goal is to see a wide array of healthy institutions sell preferred shares to the Treasury, and raise additional private capital, so that they can make more loans to businesses and consumers across the nation. At a time when events naturally make even the most daring investors more risk-averse, the needs of our economy require that our financial institutions not take this new capital to hoard it, but to deploy it……These three steps significantly strengthen financial institutions and improve their access to funding, enabling them to increase financing of the consumption and business investment that drive U.S. economic growth. Market participants here and around the world can take confidence from the powerful actions taken today and our broad commitment to the health of the global financial system.We are acting with unprecedented speed taking unprecedented measures that we never thought would be necessary. But they are necessary to get our economy back on an even keel, and secure the confidence and future of our markets, our economy and the economic well-being of all Americans.

Sorry about the negativity Arthur & 0067, but here is but the most minute example of the lying, hubris, deceitful pabulum that comes from Goldman-Sachs-trained “American values” Washington types. We are sooooo screwed.http://www.independent.co.uk/news/business/news/paulson-reveals-us-concerns-of-breakdown-in-law-and-order-1750076.htmlhttp://online.wsj.com/article/SB122398807077532387.html

So the past few years I/we’ve bought some household things. Latest was a Poulon self propelled mower. After 2 months, broke- bring it back and hope they fix it. Computers that break after a year or two. Cell phones that break after a year or so as if they were designed to blow up at a specific time- (motorola). Washing machine that goes kaput after lil more than 2 years. Countless other items too that seem to self destruct after a year or two. Where are the days when stuff lasted with reasonable care.so back to the lawn mower- i blurt out to others – do We in the US make anythign anymore that does’nt break in short order. So i thought a little more and most of the stuff is built with cheap parts from you guessed it- China,Asian countries, etc… not all the components/parts are form overseas but enough so that the Stuff breaks.So now if we go back to making American things again, producing things again, will they be any good? or will they be just like the junk we import now. Will it be because our hourly wage we pay to produce things contunues to plumment and people care less of what they make or what thier part is in in producing things.Is there anything that works anymore? or is this jsut becoming the new normal where eveything breaks and bubbles and breaks and bubbles. Our cost of health care is a disaster, our housing industry is a dasaster, our education system is a disaster, our employment opportunties and NO JOBS is a disaster, our banking system is a disaster, our Debt problems are a disaster, Is there anythign that is not broke.F..king Lawn mower…. LOL

From link above By economicminor on 2009-07-18 19:10:00State Tax Revenues at Record Low, Rockefeller Institute FindsPublished: July 17, 2009The anemic economy decimated state tax collections during the first three months of the year, according to a report released Friday by the Rockefeller Institute of Government. The drop in revenues was the steepest in the 46 years that quarterly data has been available.Skip to next paragraphMultimediaGraphicA Sharp Decline The blow to state coffers, which the report said appeared to worsen in the second quarter of the year, reflects the gravity of the recession and suggests the extent to which many states will probably have to resort to more spending cuts or tax increases to balance their budgets.Over all, the report found that state tax collections dropped 11.7 percent in the first three months of 2009, compared with the same period last year. After adjusting for inflation, new changes in tax rates and other anomalies, the report found that tax revenues had declined in 47 of the 50 states in the quarter.All the major sources of state tax revenue — sales taxes, personal income taxes and corporate income taxes — took serious blows, the report found.As more people lost their jobs, took pay cuts or worked fewer hours, personal income tax collections fell 17.5 percent in the quarter. Weak retail sales sent sales tax collections down 8.3 percent. Corporate income tax collections, which are often highly variable, declined 18.8 percent.States in the Far West had the largest declines in tax revenue, the report found. Arizona reported the largest drop in personal income tax collections, at 56.1 percent. Alaska experienced the largest overall drop in tax collections, 72 percent in the first quarter, and that was attributed to the state’s unusually high revenue collections in recent years because of high oil prices.Local governments have fared better during the downturn. The report found that local tax collections rose 3.9 percent in the first quarter, largely because of increased property tax collections, which tend to be relatively stable and which are often based on assessments of value that do not keep pace with true market conditions.As bad as the first quarter was, the second quarter is shaping up to be even worse, the report said. Preliminary data for the first two months of the quarter, April and May, collected from 45 states, indicated that tax revenues declined by 20 percent compared with the same period last year.That will force states — many of which are already raising taxes or fees, resorting to layoffs or furloughing employees — to come up with more ways to raise or save money.“The continuing sharp decline in revenues will likely force more unwanted choices for states in the months ahead,” wrote the report’s authors, Donald J. Boyd and Lucy Dadayan.

The States and Obama can raise them all they want now, but who will be payign them, all the Unemployed people, all the Companies who have decling revenues becasue they keep laying off because no one wants or can afford what they make these days…. One big Ponzi scheme in a full blown collapse… But with Turbo’s help, with Obamas help, With Bens help we will make sure that GS, MS, BAC and all the corrupt other financial houses and Big oil will all be kept afloat…tick tock, tick tock….check the clock… http://www.usdebtclock.org/

I would rather belive a foreigner who speaks English better than most locals, who’s also fluent in Italian and Farsi, was offered to do his Ph.D at Harward, was given a professorship post in one of the best univerisities in the US, and “accidently” predicted the current economic situation two years before it actually happened.Now let us hear WTF you are???P.S. If you would have followed Rubini’s prediction than the current stock market “rally” wouldn’t even matter for your 401k.Ha-ha-ha

Certainly what you say makes sense. How did that come about? Because Americans vote on the basis of looks and personality (remember, in America it’s good to do things for *stupid* reasons–stupid is good), and the corporate interests figured that out long ago. Indeed, Bush was hand-picked by Rove based on his looks and personality. Likewise, Reagan was all looks and personality. This corroborates my thesis that Americans like ‘stupid’. Our definition of ‘smart’ is good-ol-boy smart, like Uncle Jeb in Dukes of Hazzard (a series which I adored, by the way, and not just because of Daisy Mae), out-smartin them fancy folks from out-of-state. If you look at the American Math Competitions for High School students, for instance, the only ones who win are Jews and Asians. Our local boys is too busy analahzin female derriers, drinkin, and seein who can piss the farthest. So that’s how the corporate interests took over. Now, from that point on, I agree with you, IC. Perhaps the place to start is at the state level.

thanks for a detailed response subgenius. The wind power using kites is an idea I seem to like the most of the alternative energy ones (if it is the same one theoildrum a few day back, i think kitegen) as it has the best net energy return & least materials impact.Regarding the oil supplies regardless of the fact whether we have reached a peak production or not one thing is clear, that most of the global oil production is going to come from fewer & fewer countries going forward. To me that translates to much more vulnerability to price manipulation by individual players. so I would expect wider swings in the oil prices & I suspect that is what most IBanks are gunning for as there is not much else growing. so basically you can throw any commodity futures reform out the window for now.For the folks not so familiar with oil supply issues following clip should serve as a good starting point. This is a speech given by Fatih Birol the chief economist of IEA a few months back. The reason this should be of special importance is because IEA has traditionally been quite bullish on energy supply forecast but this year they had a dramatic reversal in stance (again I wonder why!!!).http://www.youtube.com/watch?v=m377Is4tGF0PS: First 15 minutes should be enough if you don’t want to watch the whole speech. But I recommend you do.

Right on MMCA!!!Bought Trot-Bilt lawn mower and hedge trimmer not even used 5 times and back in the repair shop.OK so I go to the simple life with manual tools. I can’t a single rake whose handle doesn’t break after a season of use.Same with the push brooms.I would take this junk on the shooting range and demolish it with my Barrett 82A1 but the bullets are so damned expensive.

Of course you are. You just haven’t figured it out yet. Don’t you ever feel used?

How did things get so bad so fast?Easy when the economy has become a Command and Control Monopoly game with the Winners so intent upon winning the game that they can’t think past winning. Remember “Greed is Good!” and “Trickle Down”?The stage is set and the players have their lines well rehearsed. We are at or nearing the final act.What happens in Monopoly when someone wins? Two choices, fold up the board and go home or redistribute the money and start again. Usually the first as the winners are exhausted and the losers are pissed or discouraged.The game of Monopoly is not much different than Kondratieff’s K wave theory. Or Minsky’s theories on risk. No one has proven them wrong. The wave/game is just playing itself out. And we are just on the slight downward slope of Kondratieff’s big wave. Wait until this really gets going. The only way to fix the problems is to write down over indebtedness on a massive scale. The curve needs to be near the bottom for a recovery, not just slightly off the top.

m,your spirit and sense of humor are not a disaster.

That is what we are told, and perhaps emergency action was needed for about a 10 day period. There are skeptics, and I believe the jury is still out on this issue.Of concern to me is how that $700,000,000,000 was used. Of greater concern is the $12,000,000,000,000 committment that came afterward and continues today.Sorry, but this Alice in Wonderland scenario/nightmare can be laid at the feet of the FED and Treasury Department, which are both intertwined with GS. The solutions these theives keep coming up with are not working because they put themselves first. And they are not going to work, either.In a free market society, it as simple as this: Everything is driven by demand, and demand has collapsed. There will be zero improvement until demand returns. Demand cannot be mandated, and they know it. They are in a box and don’t know how to get out of it – without extreme pain for themselves. You see, they are trying to steal all they can before it blows up, but it is harder now that so many are paying attention. In addition, they are becoming fearful that blame will actually be assigned this time, and there might even be punishment.The box is getting smaller and they(we) are running out of time. They give money to banks (far too much), and it does nothing to create demand. The money they gave to consumers (far too little) did not do much, either, as it was used largely for debt relief and daily living expenses.ALL of this bailing out of private corporations is wrong and futile. None it it creates demand, which only comes from the consumer. Any and all bailout money should go directly into the pockets of private citizens. Like it or not, that is the ONLY way to provide real stimulus and get the economy to stop the free fall it is in and begin the long road to some semblance of recovery.Independent Contractor

You have to pay twice as much as consumer brands and buy what the professionals buy to get good quality. Honda still makes good products as does Stihl and Kabota. There are some others too. But I own the above and have years of service from them. My friends who use these brands in commercial work are still buying them.

US – any of us, rich or poor, educated or uneducated. US will never get rich being an employee, except for a just a handful, GS employees is a great example.There are many success stories out there, US just has to take notice, and right now there are literally thousands of opportunities for the taking, but instead most people will instead lay blame on why US can’t take take advantage of them. There are so many small business owners that can’t successfully manage their businesses for various reasons (mostly because they are aging and tired) and want to sell, and in this environment will sell for far less than their companies’ future economic value. Need a job? Create your own and buy a business. No money? Negotiate a deal. Many states offer financial assistance similar to unemployment benefits to those starting a new business. Check with the SBA, more money is being funneled into these programs.People need to wake up to the fact that there are 300 million people in this country and most are still spending money, albeit at a slower pace. The population continues to grow and successful business owners will find their niche, grow their business, and find immense satisfaction being in control of their own destiny.US needs to stop blaming and making excuses why this and that is against US, and instead take charge and dream the dream. Don’t expect to be a Warren Buffett or Bill Gates overnight, but instead build a company that is sustainable and that can offer continuous employment over the long-term for hard-working and creative employees. Be the employer you once dreamed to work for, or once worked for, and raise the bar for other companies so that all of US can stop worrying about whether or not US will have a job next week.

What do you expect from those who live in castles built above the clouds? They suck up all the resources and send their sh@T back down but have no other connection to the masses living below.Why would you expect them to make a decision that would benefit us? When they know nothing about us.I’m not going to absolve us from our part though. We The People fell hook line and sinker for their BS and put ourselves into the debt slave position. AT least many of our citizens did. They made extremely poor decisions and choices and relied upon those living above the clouds to have empathy or at least concern for us. As anyone who is paying attention to the Sotomayor hearings know that those at the top abhor even the idea of empathy. They are totally of the dog eat dog Privileged Set who believe we should climb over each other’s backs to obtain the positions they now hold. For the position of power and immunity above the law with its Privilege is more highly prized than any ideal, person or even god.The PTB are amoral and have no concern for any of us. Even Obama’s health care plan appears to be just another way for them to suck up our precious resources and not a plan that has any real beneficial effects for society as a whole. They say it does but we all know who and what are the problems with the existing system are and those players are being promoted not restricted or better yet eliminated. How can you fix a system that way? You don’t! Just another sympathy play that sounds good. We are going to fix Health Care! Yeah, just some more BS IMHO.

It is now Casino Night in the Disaster Capitalism Casino!Which way has GS bet on CIT?We cannot run a society based on this kind of disaster opportunities casino. The pattern has been that every new innefficient market or privatization yields high profit opportunities. A boring society of productive capitalism without manipulative speculation is not in the cards for humanity. The time has come to change the software. Banks must become utilities and Casino Speculators cannot be subsidized as banks(GS).

Yep. The Guvernator will not raise taxes. California’s going to sink, and not into the ocean. Gawd help those folks out there.

Whats the deal?You can hit little balls with a stick even whit 89.

http://trueslant.com/matttaibbi/2009/07/16/on-goldmans-giganto-profits/If this Matt Taibbi piece was published in the op-ed section of Major Newspapers, there would be righteous indignation and we would wake up.However, you make a great point. There are no true believers in anything amongst us(myself included). When society has no true values and 1 out 6 people in the world are starving, we deserve what is coming to us(myself included).What is coming to us is very predictable. Go to any third world slum and you will see the future. There will be enclaves for the cloudminders and slums for the rest.

Most of the low-priced made-in-China tools are made of relatively soft, non-hardened steel which requires less energy to make. Examples include pipe wrenches that lose their grip after being used only two or three times, and screw drivers that bend or break easily. The cheaply made tools look good in the store but are much more rust-prone than expensive, high-quality tools.

The nation’s healthcare problems could be solved by extending Medicare insurance coverage to all citizens. Medicare is a pre-existing, non-profit system, so simply extending its coverage to all age groups would prevent the needless expense and complexity of designing a new system. Private, for-profit insurance companies could still serve those who can pay the prices, as they do now, but the new government system would make healthcare available to everyone, regardless of ability to pay.

Well said Geust!

BEarthright – the Economics of FreedomConsider this….Without access to this planetand its resources you can’t eat, breathe,walk, sleep, work or play.Land is more than somewhere to live – it is life itself. Without exception, everything around you, EVERY SINGLE THING you use and consume in the process of leading your life are products of the land.These are the simple facts: If you have no land to live from, you are dependent on money to purchase the products of the land; if you have no money to live from, you depend on employment to gain the money; if you have no employment, then you’re dependent on the State; if the State refuses you, you beg for the charity of the rich; no charity, you steal or you die.Such is the chain which binds us to each other, and to the land.Whose Planet are we living on?To live is to use Land – To own Land is to own Life itself.Every inch of our planet is now owned by some person or organisation.The majority population (60% to 90%) in EVERY inhabited country are landless – own no part of the planet whatsoever, not even their own homes.The richest 5% in every nation, rich and poor, North and South, East and West, now own between 70% and 95% of their own countries.If you do not own enough of this planet to support yourself, and you cannot support yourself without this planet…Who is it who supports you?And do they support you…or through their owning the land that supports youdo they now own you, own your work, own your space,own your freedom to live as you choose?If you own no land to support yourself, you must rent, hire or buy it from those that do, so that you may both live and make a living.If you cannot use the planet to feed, clothe and provide for yourself then to stay alive, you must choose to either work for those who own your planet, to become a thief or a beggar, or to die.This servitude has taken on many forms throughout history:slavery, serfdom, day-labour, employment. The only variation being the share of the wealth produced left to the planet borrowers by the planet owners.This simple reality underlies much of today’s poverty, inequality, lack of freedom, unemployment and powerlessness, experienced as the sheer struggle to get by that looms so large in so many peoples’ lives.These latter day pharaohs, the planet owners, the richest 5% – allow the rest of us to pay day after day for the right to live on their planet. And as we make them richer, they buy yet more of the planet for themselves, and use their wealth and power to fight amongst themselves over what each posesses ~ though of course it’s actually us who have to fight and die in their wars.Land is not property ~ land is life.Land is not created by people ~ it creates people.We need land ~ but land doesn’t need us.These are the Powers in the Gift of the Land -the Land Owner owns life: (food, living space, materials ~ fortools, building homes, cities, technology)the power to create or destroy people: (famine & war, plenty & opportunity)and to cut people off when no longer needed: (unemployment, homelessness, poverty, starvation).The Power in the land is the Power OF the Land95% of the USA is owned by the richest 3% of Americans60% of El Salvador is owned by the richest 2% of El Salvadorians86% of South Africa is owned by the white minority74% of United Kingdom is owned by the richest 2% of Britons84% of Scotland is owned by the richest 7% of ScotsWhose Planet are we living on?The Earth is the mother of our being,for everything we have and everything we areis created from her.Gaia ~ our land, our planet, our only home.To own land is in essence, to own reality.http://www.geocities.com/RainForest/3046/index.html

And when they have stolen it all? And won the Monopoly game? Then what?What will they have except anger and loathing from the general public? Fear and more fear because they acted in their own self interests against the interests of We The People.They may have fine lifestyles today but they have put their own futures at risk because there will be a day when incomes can not pay all the burdens imposed upon the working class and the working class will revolt.This is a similar syndrome as when Europe had its entrenched aristocracy and the people were no more than surfs or poor working class.

VERY GOOD POINTS MM CAIn Obama’s favor though, I’d state that the Boeing 767 was mostly developed using mostly homegrown/local Seattle kids with like 1-2 yrs of college [and paying them decent wages] and having the other 30% of the degreed workforce do layouts and checking. It worked wonderfully and Boeing’s 767 was a rousing success, compared to today’s mostly outsourced 787 failure.We don’t need more degreed professionals in an US Bureau of Labor Standards 2006-2016 top 30 occupations country where only 20% of these jobs require a degree….I know the 4 yr colleges state “ya got have a degree” to survive; but the past actuals refute this allegation.I’m highly educated/degreed and worked with some of these local domestic Yankees in tech fields from local CCs and can tell ya….they deserve the higher pay and they made the company and its stock holders mass bucks too.That’s the trouble with America today IMO, we need to rediscover our own magic, instead of killing it off by being cheap and demanding only 4 yr degrees, especially when we outsource to countries that simply can’t invent out of the book like good ole Yankees.Remember the old axiom: “Ya get what ya paid for”.

Just a quick note to nod in agreement with the necessity of getting single-payor healthcare and reclaiming our duty and right to print our own money. Will be back later today, but have to finish picking and preserving produce from my garden right now – and it’ll take a while.If only we could figure out how to share cucumbers, peas, beans, tomatoes, zuccini, herbs, and peppers online, I’d happily give you guys some!Anybody like gooseberry pie?Anyways, Hava good afternoon…

g,many hands make very light work.

This has been driving me crazy recently: the presumption that we are going to “recover from this recession” per the quote from above, “There are two parts to the problem. First, over the next decade or so, even once we recover from the recession, federal revenues will fall far short of federal spending….”I don’t think anyone in the press actually entertains the notion that we are not going to recover from this DEpression. That the only reason GDP isn’t declining in double digits is because of statistical manipulation and a massive increase in government spending; however, the increase in spending isn’t being allocated to generate new means of production for sustainable growth – it is basically giving short-term funds out for people to use in consumption to pop short-term numbers.Unless a paradigm shift occurs that suddenly starts to create wealth and jobs in a manner that reduces TOTAL debt/GDP well below the most recently calculated 360%, this depression is going to gain momentum. We will not recover. It is like saying of the Madoff ponzi scheme – well, after the ponzi scheme started falling apart, investors lost a lot of money, but once it recovers then we’ll be seeing new issues…We are in the middle of the biggest Ponzi collapse in history. The current government spending is supporting the final round of that scheme. When it collapses, there is no recovery, there is a massive default, and, as I’ll keep saying until I’m blue in the face, the US dollar will totally collapse in value, and the entire global financial system will fail. The geo-political fallout is going to be a monumental disaster.The fact that everyone in the press indicates, as a total foregone conclusion, that we will end this recession and there will be a recovery, does a disservice to us all. It means that very few are actually able to learn of this highly probable outcome, and thus, very few are acting toward preventing it.It just gets so frustrating sometimes. Real things need to be done, and the idea that the loudest voices use the fallacy of assumption to just make it appear as a foregone conclusion that recessions will always end in recovery is maddening!!! Don’t they see that it’s different this time???–Brian

@Economicminor.Your class warfare BS is getting to be too much. Will you please knock it off? It’s really tiresom.

ICYou are correct about the “Small Business person and their employees” They are being expected to pay MORE than their way .You have it right,Statisticly it is true…Farnorth5

It was nice when the best products were American-made, AJ.SWK

No one is forcing you to read it, Comrade.

Brian :To answer your question,they dont either believe or understand or want to admit that what happened and is happening is not a conventional Recession,but a DEBT MANAGEMENT DEPRESSION,brought on by increasing the total debt 10% per year for the last ten years and having the National GDP only increase by 3-4% per year.The truth is a Debt pyramid was created ,just like in the 1920,s and then as now, the QUALITY of the debt in the pyramid was ignored .(Everyone at the top was having too much fun making stacks of money ,based on the artificial debt creation)So nothing new here.No one is going to admit the “Difference” this time from other recessions since the Second World War as it brings up the subject of “Who was in charge and who is responsible for the unnecessary mess ,including 6 Million out of work and rising???

You should not post after the 3rd Martini.Independent Contractor

I just heard about a comment from an old neighbor of mine. There’s a house for sale on that block, priced at least $150K over where it should be in that modest middle-class neighborhood. It’s been on the market for months and the current owner was heard to remark that she might just have to take it on the market and wait until the price comes back up IN ANOTHER YEAR OR SO.People still think that home prices are going back to the bubble levels, folks.

Just canned my 35th quart of beans, and 50th quart of pickles. Wish I could do something with 2000 cherry tomatoes.

SWK, you are right, as you most often are. My following post to EconomicMinor addresses the issue on a fact based basis.

We froze them last year and used them for soups and spag sauce all winter long. Still got some in the freezer, which is a win because this year`s cropwill be late.

The big push we are being subjected to is to believe that a “recovery” is about to occur. This gives us CONfidence so that we may SPEND more freely and as such SAVE less. This then would of course restore life to the service economy where manufacturing is far less job impacted than say retail or financial services.The so-called logic holds that once “green shoots” are seen this must mean than decline has not only halted but new growth is apearing.After the theft of several Trillions of taxpayer dollars that was force fed by the US Govt into the Banksters pockets, one would expect that Banking Armageddon would have at least been put off. And so it does seem. This then forms the first part of the great mirage- We Are Saved.With all those Trillions is it a wonder that a stock market rally of substantial proportions has occurred? Look- Profits at Banks! Non Farm Payrolls now under 600K per month! Are those not GREEN SHOOTS???!!!Economic collapse postponed err halted, green shoots and now naturally the inevitable following carraige in the train- RECOVERY! And they even have Roubini to lean on for that.Of course this is all a fabricated mirage.The US Govt is complicite with the MSM in spinning the “recovery” meme and all to some good effect. The fact that it is a mirage nonetheless should not be lost on us though , even if Arthur thinks otherwise.Since WW2 the story of the US economy has been written by the Baby Boomers. The 60′s, 70′s, 80′s 90′s and this decade- all have the unmistakeable and immutable driving and controlling force of the Boomers in the shaping of economics, investing and political strategy. In short, there was not a single economic or investment outcome that was not a result of Boomer behaviour. If the Boomers are not buying into it, it won’t fly. More to the point, if the Boomers and I daresay their immediate offspring who they so activey support don’t buy into the BS or “Recovery”, then recovery as it is being spun to us won’t materialize. I’t cannot. And these 2 articles illustrate in detail why there is NO RECOVERY without the Boomers.http://seekingalpha.com/article/148505-boomers-in-trouble-the-unheralded-economic-mega-trend-part-1?source=feedhttp://seekingalpha.com/article/149049-boomers-in-trouble-the-unheralded-economic-mega-trend-part-2

Just something for everybody to think about overnight.Do any of you see any similarities between the `hate Goldman` attitudes in these difficult economic times, to the anti-Semitic sentiments in pre WW2 Germany?

And that’s why I don’t use a microwave any more. Got tired of buying one a year. Just say “NO” and use the freakin’ stove! Saving $100+ a year pays for a lot of burner time.

NR predicts primary tendency, not secondary, nor 3th…

That’s a very good point where the German people mistakenly blamed all Jewish people for the poverty of the nation when they should have gone straight for theJewish bankers who were pillaging the country. I think it’s important to only specifically go after the evil bankers right now and not all Jewish people. But don’t kill anyone just imprison the ceo’s and top management of the big banks/federal reserve which just so happen to be mostly Jews but don’t preclude any other religions just get the bankers period whatever religion they happen to be because evil is evil!!!

And, believe or not, NR is a optimist…

I will try stay liquid, wait the inflation starts, then run to buy land and assets of “inelastic” products… But if i find some bargain in the way… Stocks is like a “horn”…

“V_” shape is my bet for primary. I think the will be slower and deeper than the V. So im preparing my finances for this… The time of high profits is over. Now is the time to keep what you have in safe place…

NR predict years average (primary), not months… The game in bull is different than bear… In bull you can sleep and let your shares alone… In bear you have to keep the eye aways open…

American Billionaires in Red China?The only one I know has six estates around the world and wouldnt be found dead in “RED CHINA”,however his companies staff are very happy to do business there.His favorite places are on Islands where similar people visit each other from their gated communities.

AMEN GSM AMEN:If it wasn,t for the German Politicians ,the German Banksters would not have had the legal ability to do what they did.Another political tradeoff.You would have to see who gave the Politicians the money to finance the country,All those lovely WAR MATERIALS and MODERN EQUIPMENT THAT RESULTED..At the end of the day the rule of law is what matters…

I am just trying to have a dialogue about what happened and why. I applaud your getting ahead. I did myself. My parents scraped by and I did when I was a young adult. That doesn’t change what is happening today. Because we benefited by our brains and labor does not mean a thing in the big picture. While we were getting ahead, many others were falling behind but those at the top of the pyramid were jumping forward by leaps and bounds by using immoral or amoral methods.First off the total taxes paid by the wealthiest is a misnomer and very misleading. In most cases, the figures used neither captures social security taxes or the untaxed benefits of the corporate leaders. Many of these people drive corporate owned vehicles or are picked up by company cars. Most of their travel, including for pleasure is paid for or not taxed. Lots of expenses that everyday people pay out of their own after tax pockets are covered by the wealthiest. Even their health care is free to them. The untaxed benefits are ignored by most tax *research* while the taxes paid by the working class are often not counted as taxes because they may receive a benefit some day.None of the above account for the mandatory costs imposed upon the workers vs their incomes either. When most working people get done at the end of the month, they are in the hole. When the wealthiest people get to the end of most months, they have more. AND it isn’t working out for either the wealthy or the workers.The numbers don’t lie, the top 1% has a larger share of the pie now than ten years ago and the average worker is much further in debt. The wealth gap has grown dramatically.The result of the policies, accounting methods, tax research BS have had consequences and that is showing up in defaults, foreclosures, falling retail sales and lower taxes received by the government. The working class has been increasingly squeezed for 30 years now and is now in full retreat. This is affecting the incomes of the elite but the entire foundation of our way of life is crumbling because of it. It doesn’t work and if that means you have to have less income so that 20 other people can survive, then so be it. To bad for you and me to.

Dr. Roubini is an economist not a stock market cycle analyist. His forecasts are the perfect fundamentals to Elliot Wave cycles. The best Elliott Wave person in the world is Robert Prechter at Elliott Wave International. They timed the top perfectly in 10/07. The markets completed a 5 Wave top of Cycle Degree in 1/2000 from a beginning in 1932. a 68 year bull market is being “corrected” over a period of about 14-16 years into 2014-2016. The correction will take a three wave shape labled A,B,C starting in 2000. The A and B are complete, and we are now in wave C. Inside of wave C will be 5 waves down. We have completed wave 1 (17 months long) and are now in wave 2 and have 3,4,5 left to complete wave C. Look at a 80 year chart of the Dow to clearly see the 5 waves up from 1932. Usually the A,B,C corrects the whole 5th wave (1974-2000, 26 years) The support is in the 4th wave (1966-1974,8 years of flat sideways movement) Thats below a 1000 points on the Dow. These deflationary events have happened before in 1720-1780, 1837-1842, and 1929-1932. Mr. Prechter thinks this actually ia also a wave 4 partner to wave 2 from the Super Cycle degree which was the wave 2 in 1720-1780 which means this is a bigger correction than the 1929-1932 depression and so far the data supports this. (“rate of decline” of employment, SP500 profits, real estate deflation, dividend cuts to match profit decline) The Elliott Wave Cycles always complete themselves. They are a fractal math patern that move with fibinoci realtionships to each other and are a representation of social mood of investors in the market. The nickname for wave 2 in a bear market decline is “hope springs eternal” by R.N. Elliott himself 75 years ago. We are in a wave 2 of C now, thus the hopefull comments we are now hearing everywhere. Dr. Roubini has it right. The next wave 3 down will start before the comments change.

So, we impeach Obama and we get Biden. So we impeach Biden … if we waited long enough to see who he names as VP, we get the Democratic version of Gerald Ford, else we get Pelosi. And the chain of misery continues … no, I think I’ll stay with the devil I know.

NEW YORK (MarketWatch) — I’m amazed: Grousing about Goldman Sachs, and fury at the financial sector, is actually reaching the point where something might happen — maybe even answers to questions we’ve been asking for a while.http://www.marketwatch.com/story/is-grousing-about-goldman-reaching-critical-mass

The bottom line is that Goldman’s blowout quarter is good news for Goldman and the people who work there. It’s good news for financial superstars in general, whose paychecks are rapidly climbing back to precrisis levels. But it’s bad news for almost everyone else.Paul Krugman, The Joy of Sachshttp://www.nytimes.com/2009/07/17/opinion/17krugman.html?scp=3&sq=krugman&st=Search

Some would say it was the Boomers who got us into this mess ….

who is carrying whom, you ignoramus

Are you saying that posters who do not agree with the consenus on this site should not contribute? Much of what Arthur wrote is actually the same as Roubini’s ideas. Arthur said that he was not bullish and that the stock market would only move sideways for several years. That is more or less what Nouriel is saying. I think that Arthur has probably died of his heart problem. If so, we won’t hear from him again.

v,scary thought. see bottom region. below.under this. scroll. etc. scary song..http://www.bobdylan.com/songs/not-dark-yet

j,his heart problem was all in his mind. i hopehe is fine and enjoying something beautiful forthe sake of his heart/mind “problem”.

I shall be watching your future posts for just the slightest grammatical error, Jason B.As they say, it takes one to know one!

the point is he’s always changing his message. it has nothing to do with 2 yr vs 4 yr. but the $yr college system her ein Californai is getting ripped to shreds because of no money. 40,000 being denied this coming spring. CC’s dont have the room. k-12 gettign destroyed.he’s a bait and switch. Just like his promise to creat 3-4 million jobs became create and SAVE. and guess what that out come is – NO JOBS!

Actually, I think this site is great, even if it does get a bit tired at times. Good old Arthur got things stirred up last week and I decided to make my posts a little more edgy.The post about pre WW2 in Germany was to address the mood that is growing, if this site is a reflection, of the mood in the country. As another poster said, there is evil amongst us and it should be rooted out. I have friends that have worked at GS and they are decent human beings. I don`t like seeing them tarred with the same brush, much like Germany`s Jewish population were leading up to the war.And by the way, Anonymous, I don`t regard myself as being beaten `by words and facts`, I think I more than hold my own.Have a good day.

i don’t believe Obama is evil I think he’s just really that stupid and so enamored and proud of the success he’s achieved he’ll continue doing what got him there kissing TPTB’s a$$. He believes brown nosing and education is how you achieve success however as the playing field becomes more and more inequitable no amount of education or brown nosing will work. All of my friends have either 4 year or masters degrees and most have been laid off or taken a 10-30% pay cut, education didn’t save them. Now all of them are going back to school at 40-45 years old to get another degree. Keeping us all in school is the elites justification for not paying us-no body’s ever qualified enough to warrant paying or have security-it’s the ultimate scam and system of obfuscated slavery.

I would say there has been more than a little of this at work already … do you really think the poorest of America’s poor could drag down the whole world economy without some oomph behind them?

One of The next bubbles bursting… so what will all the unemployed do when they are out of benefits? They may start getting a little angry i suspect.. the heat is on…500,000 Will Exhaust Unemployment Benefits by September, 1.5 Million by Year-endThe Emergency Unemployment Compensation (EUC) program began in June 30,2008. Benefits under the act have now been extended twice. Unless Obama extends the program a third time, it’s the end of the line for many receiving unemployment benefits.Please consider First wave of jobless exhaust unemployment benefits.Thousands of jobless Pennsylvanians are joining the growing ranks of people around the country who are exhausting unemployment benefits, as some experts worry about another blow to a stumbling economy.Gov. Ed Rendell said 17,800 Pennsylvanians exhausted their jobless benefits in the week that ended Saturday, the first big wave of Pennsylvanians to do so. He urged legislators to pass a bill to extend the benefits.Around the country, the number of people exhausting their benefits is piling up. By the end of September, more than 500,000 people will exhaust their benefits checks, with the biggest groups in Pennsylvania, California and Texas, according to estimates by the National Employment Law Project, an advocacy group for low-wage workers based in New York City. That number will nearly triple by the end of the year, the group said.New York Qualifies For Extended BenefitsAs some states exhaust extended benefits other now qualify. In New York, Benefits Extended As State Unemployment Numbers Rise.The number of jobless New Yorkers across the state jumped significantly during the month of June, according to state Department of Labor statistics released Thursday.The unemployment rate increased from 8.2 percent in May to 8.7 percent in June. That’s the highest level since October of 1992.In New York City, the rate increased from nine percent in May to 9.5 percent in June — the highest level in more than a decade. That translates into more than 850,000 people out of work in the state.”Because of our 8.7 percent unemployment rate, we will qualify for an additional seven weeks of unemployment insurance benefits,” said New York State Labor Commissioner M. Patricia Smith. “So right now New Yorkers will be eligible for 79 weeks of unemployment insurance benefits.”Unemployment benefit extensions are expected to help an additional 47,000 jobless New Yorkers who would have lost their benefits in August.79 Weeks is a long time to be without a job. Yet it’s happening in mass.President Obama claims he will save 3.5 million jobs. When? Who gets to count? The reality is no one is counting and the number is fabricated. It is impossible to count “saved jobs” so Obama can pick any number he wishes.How did Obama arrive at 3.5 million? Simple – It was the largest number he thought he could get away with.Meanwhile bear in mind that the continuing claims number does not include those on EUC. I posted several charts of EUC in Unemployment Claims: How Bad are the “Real” Numbers? to show what the real continuing claims number is.Here is one of the charts.Continuing Claims + EUC Extended Benefits from 2000-2009click on chart for sharper imageNote the dips in the EUC numbers and the corresponding dips in the total numbers. Compare to double extensions in emergency benefits:”The original extension passed in July 2008 paid up to 13 weeks of additional benefits. Effective November 23, 2008, we can pay up to 7 additional weeks of benefits. Effective December 7, 2008, we can pay up to another 13 weeks of benefits.”The above chart was from July 10th. New Weekly Unemployment Claims figures came out on July 16.Note the huge drop in continuing claims and the 4-week moving average of continuing claims. Two factors account for the drop.1) Extended benefits expiring2) A huge seasonal adjustment factor beyond the ordinary related to auto manufacturing plant shutdowns skewed the seasonally adjusted numbers.The key point now is the number of people whose benefits have expired or are about to, and those people will not show up at all in the above weekly unemployment releases.Unemployment Insurance Exhaustion RateDave Rosenberg has an interesting chart of expiring benefits in Breakfast with Dave on July 17.The Bureau of Labor Statistics said that the move in claims has nothing to do with any improvement in the economy. I think this is all about the fact that with GM and Chrysler in bankruptcy and all the permanent shuttering of plants and workers, there are fewer of these employees left that go though the normal seasonal shutdowns. So, fewer seasonal layoffs in the auto sector, I firmly believe, are behind these recent declines in initial jobless claims. We will know if this thesis is correct in a few weeks. (Also keep in mind that the shutdowns happened in June this year, not July, as is normal, and hence this is giving a skew downward to the claims data. To reiterate, these numbers are telling us nothing about the economy.)Claims dropped 47,000 to 522,000 in the July 11th week, on top of a 48,000 slide the week before — combined falloff of 95,000. At the same time, the non-seasonally adjusted data soared 108,000 over the past two weeks. Go back to the same two weeks in 2008 and you will see that a similar decline in unadjusted claims (-115,000) translated into an 18,000 drop in the seasonally adjusted data.So something with the seasonal factors is at play here; not the economy. Note that in the month after the seasonal auto effects ran their course last year, claims popped up more than 80,000.To be sure, continuing claims plunged a record 642,000 to a still-high 6.273 million but this actually reflected bad news in the sense that it likely reflects the end of the up-to-20 weeks extended benefits that President Obama provided under the stimulus plan. These people are certainly not going to be doing very much spending over the next little while.Also note that the claims data would be much higher if a record number of unemployed folks weren’t seeing their benefits cut off — see the chart below for an illustration of what we are talking about.Take a good look at that chart. It’s 50,000 now. It is expected to be 500,000 by September and 1.5 million by the end of the year. What are the odds Obama creates 1.5 million jobs by the end of the year? I suggest the answer is zero.Mike “Mish” Shedlockhttp://globaleconomicanalysis.blogspot.com

The new racial laws made it illegal for Jews to own property, and many German companies were Jewish-owned. The anti-Jewish racial laws were enacted to facilitate the pillaging by forced sale of property, primarily as a source of money for rearmament but also to serve Aryan-owned companies that wanted to acquire Jewish-owned businesses at about one-tenth of their fair market value. For example, racial laws enabled the forced sales of Jewish-owned German media companies, such as those owned by the Ullstein and Mosse families, who had to sell under threat of being sent to prison for owning property. Jewish-owned media were especially targeted because they were among the most liberal of the German publishers – Nazism is a far-right, extreme anti-liberal political movement, similar in many ways to today’s American far right. Once the oppositional publishers and political parties, including Communists and Socialists, were outlawed and their assets sold, Germany quickly became a one-party state, totally under control of the fascists. Furthermore, during the 1930s, there was significant support for Hitler in the U.S. Among his American supporters was Henry Ford, who published his “The International Jew” in support of Nazi Germany.

The first sentence should read `..,the politicians learned they could use a tool`Sorry for the error.

well said! We have 3 branches of govt who are hired by us to check one another and to fairly regulate and enforce the laws of this country. The continual circumvention and manipulation of these laws by those with great wealth and power ultimately hollows out the image of the U.S. by changing it from a democracy run by the people to a hypocracy run by oligarchs.

“That is a problem with our tax system, it punishes effort and success.”That depends on one’s definition of “effort” and “success”. Wage slavery and wealth accumulation isn’t everyone’s idea of accomplishment and prosperity. Arguably it is the meme that feeds the machine, though.

“And in these difficult times, `people` think that the government can come to their aid. As has been posted before, governments provide nothing, they create no wealth.”NO! “People” want government to fulfill its role as representatives of “The People” … not Wall Street.

Visions of things to come?History does indeed repeat itself.

Your `representatives`represent themselves only. They are all feeding at your trough. Its been that way for a very long time.

Amen, guest. That little difference is the difference between night and day.Independent Contractor

I would take issues with your timing of the mental change in America. It was not during the early to mid 70′s. We were very divided socially during that period, and busy with the war. Then we got the oil shock and the country freaked.What came next was the Reagn/Bush era of greed, divisivness, deregulation, and corruption. I remember it well.Independent Contractor

From above – So do people still believe in Stock markets as an honest way of investing?Matt TaibbiJul. 16 2009 – 12:31 pmThe real price of Goldman’s giganto-profitsSo what’s wrong with Goldman posting $3.44 billion in second-quarter profits, what’s wrong with the company so far earmarking $11.4 billion in compensation for its employees? What’s wrong is that this is not free-market earnings but an almost pure state subsidy.Last year, when Hank Paulson told us all that the planet would explode if we didn’t fork over a gazillion dollars to Wall Street immediately, the entire rationale not only for TARP but for the whole galaxy of lesser-known state crutches and safety nets quietly ushered in later on was that Wall Street, once rescued, would pump money back into the economy, create jobs, and initiate a widespread recovery. This, we were told, was the reason we needed to pilfer massive amounts of middle-class tax revenue and hand it over to the same guys who had just blown up the financial world. We’d save their asses, they’d save ours. That was the deal.It turned out not to happen that way. We constructed this massive bailout infrastructure, and instead of pumping that free money back into the economy, the banks instead simply hoarded it and ate it on the spot, converting it into bonuses. So what does this Goldman profit number mean? This is the final evidence that the bailouts were a political decision to use the power of the state to redirect society’s resources upward, on a grand scale. It was a selective rescue of a small group of chortling jerks who must be laughing all the way to the Hamptons every weekend about how they fleeced all of us at the very moment the game should have been up for all of them.Now, the counter to this charge is, well, hey, they made that money fair and square, legally, how can you blame them? They’re just really smart!Bullshit. One of the most hilarious lies that has been spread about Goldman of late is that, since it repaid its TARP money, it’s now free and clear of any obligation to the government – as if that was the only handout Goldman got in the last year. Goldman last year made your average AFDC mom on food stamps look like an entrepreneur. Here’s a brief list of all the state aid that is hiding behind that $3.44 billion number they announced the other day. In no particular order:1. The AIG bailout. Goldman might have gone out of business last year if AIG had been allowed to proceed to an ordinary bankruptcy, as AIG owed Goldman about $20 billion at the time it went into a death spiral. Instead, Goldman gets to call upon its former chief, Hank Paulson, who green-lights this massive, $80 billion bailout of AIG (with Lloyd Blankfein in the room), at least $12.9 billion of which went straight to Goldman. Moreover, let’s not forget this: both Goldman and Bank Societe Generale had been tattooing AIG with collateral calls in the period before AIG’s collapse, with Goldman extracting a full $5.9 billion from the company during that time. It was those collateral calls that really killed AIG.Now, ask yourself: exactly how big would Goldman’s profits be this year, if they had to fill a still-extant $13 billion or even a $20 billion hole on its balance sheet from AIG’s collapse? You think it would still be $3.44 billion? What if Hank Paulson had elected to save Lehman instead of saving AIG/Goldman, how big would Goldman’s profits be then? Is anyone even asking this question?I keep hearing people say, “Well, so what — it’s only fair that Goldman got paid off for its deals with AIG. After all, AIG was contractually obligated to Goldman. Goldman deserves that money, because it was doing the right thing in buying insurance from AIG in the first place.”That’s bullshit, too. As Rich Bennett over at the hilarious monkey business blog pointed out to me the other day, Goldman was insane and reckless in making those deals with AIG. Goldman wasn’t removing risk from its books by buying CDS protection from AIG, they were exchanging one kind of risk for another kind of risk, counterparty risk. “If you have too much risk to one entity and they go bust, you’re shit outta luck,” Rich says. “They took AIG for a ride, and when the music stopped, they and their partners were going to be taking up the proverbial tookus.”So to review: Goldman makes insane bets, runs wild on AIGFP’s house idiot Joe Cassano for a while, sticking him with $20 billion in risk, and when it all went to shit — as it inevitably had to — they drove a big stake through AIG’s heart and got the government to step in and pay them off using our money. How’s that for market capitalism? Just like Adam Smith drew it up, right? They’re just smart guys!2. TARP. Much discussed, no need to really review here. Goldman got its $10 billion. It paid off its $10 billion. Good for them. However, there’s one thing to note here, and it hasn’t been mentioned really at all in the press. It is continually reported that now that Goldman has repaid its TARP money, it no longer has restrictions on its executive compensation. That’s actually not true. The government still holds warrants from Goldman and other companies that it acquired during the TARP process, and until the banks pay off those warrants (and they’re all already trying to pay them off at below market prices), the Treasury still technically has the authority to prevent lavish bonuses. Not that that will happen, of course, and this is yet another government handout — a firmer government would be hard on Goldman to the end of the process, while this government is doing its matador job and waving through these massive bonuses early on in the repayment schedule.3. The Temporary Liquidity Guarantee Program. So Goldman last year converts from an investment bank to bank holding company status, which now makes it eligible for a new program that gives commercial banks FDIC backing for unsecured debt. This is not a direct subsidy in the sense of us actually handing over a bunch of money to Goldman, but it’s almost better, in a way. This basically hands over a free AAA rating to the big banks and allows them access to mountains of cheap money, with all of us on the hook if something went wrong. This is the equivalent of telling Exxon it can take crude from the Strategic Petroleum Reserve at below-market rates during an energy crisis and then turn around and sell it on the market at whatever price it wants, and pocket the difference, for the good of God and country. Goldman took full advantage of this deal, issuing $28 billion in FDIC-backed debt after its conversion. Exactly how hard is it for a bank to make a profit when it has unlimited access to virtually free money? It is almost impossible for banks to not make money when their cost of capital sinks this low.Ask yourself this question: has borrowing money gotten any cheaper for you this year? Did someone from the government walk up to you after you foreclosed on your house or missed payments on your charge card and, as a favor, just because you’re so cool, jack your credit score back up to the 99th percentile and invite you to start all over again? Because that’s what happened to these assholes. They made every bad move you can think of and they not only got a clean credit slate but a vitually ceiling-free spending limit.4. The Fed Programs. By converting to a bank holding company, Goldman also became eligible for a whole galaxy of new bailout programs administered through the federal reserve like the Term Asset-Backed Securities Loan Facility (TALF); it also became eligible to borrow cheap money from the Fed’s discount window. There is so much to cover here that it would take forever to get to all of it, but the key number to remember here is $2.2 trillion (not billion, trillion). That’s how much the Fed has lent out in assistance since this crisis started and we have no idea how much of it went to Goldman or any other firm, thanks to Ben Bernanke, who refuses to disclose this information. But you can bet that Goldman has taken full advantage of all the various programs designed to relieve the banks of the worthless crap assets they acquired while they were playing roulette the past ten years or so. We just have no idea how much crap they unloaded on the Fed, or how much they borrowed. Would you really bet that it wasn’t much?5. The TARP Repayment Bonanza. See the story at the top of this piece. As part and parcel of the TARP program, the banks that received money had strict guidelines imposed on them by the state in the area of how they could raise the money to repay. TARP recipients had to issue new equity according to certain parameters, and guess who one of the only major equity underwriters left on Wall Street is? That’s right, Goldman, Sachs. So say International Reckless Dickwad Bank needs to issue $100 million in new stock to pay off TARP; they hire Goldman to do the deal, and since the fee for equity underwriting is 7%, Goldman gets, in essence, a state-mandated $7 million fee. Because so much money was lent out under TARP, the underwriters on Wall Street made a massive bonanza on all the new bank stock. As noted above, Goldman’s equity underwriting department hauled in $736 million this quarter. Does this happen without the bailouts? No. Do the bailouts happen if banks like Goldman hadn’t blown up the universe in the first place? No. You do the math; this is another subsidy.And that’s just some of the help they’ve gotten. Should we bother to count Goldman’s status as one of just 17 remaining primary dealers in U.S. Treasuries, which naturally did a crisp business last year as the U.S. borrowed its way out of a hole the banks had themselves created? Should we count the ban on short-selling Goldman asked for and got last year? Or how about the seemingly obvious fact that the bank used all of this state assistance and guarantees as a crutch to prop up lots of new risk-taking activity, which was the exact opposite of what was supposed to have been achieved by the bailouts, which were supposed to usher in an new era of austerity and temperance?As Felix Salmon notes, Goldman last year, after it converted to bank holding company status, announced that it was “taking steps to reduce leverage.” But what’s happened since then is that Goldman has actually been emboldened by all its state backing to borrow more and gamble more than ever. This is the equivalent of a regular casino gambler who hears that the house has doubled down on his credit line and decides to stay up at the tables all night, instead of going home and sobering up. Just look at Goldman’s VaR, or Value at Risk, which measures the amount of money the bank puts at risk on any given day: it’s soared since last year.Taken altogether, what all of this means is that Goldman’s profit announcement is a giant “fuck you” to the rest of the country. It is a statement of supreme privilege, an announcement that it feels no shame in taking subsidies and funneling them directly into their pockets, and moreover feels no fear of any public response. It knows that it’s untouchable and it’s not going to change its behavior for anyone. And it doesn’t matter who knows it.There are going to be some people who say that some of this stuff isn’t government subsidy so much as ordinary government contracting. After all, do we criticize Boeing for making airplanes or Electric Boat for making submarines during a war? If we don’t do that, then why should we be pissed about Goldman making a profit underwriting TARP repayment stock issuances, or Treasuries?The difference is that Boeing and Electric Boat didn’t start the war. But these guys on Wall Street causesd this crisis, and now they’re raking in money on the infrastructure their buddies in government have devised to bail them out. It’s a self-fulfilling cycle — beautiful, in a way, but at the same time sort of uniquely disgusting. That they’re going to get away with it is bad enough — that they’re getting praised for it, for being such smart guys, is damn near intolerable.

a lot of the “stimulus money” has been going to fund extentsions, food stamps, etc…

And the Housing recovery is well under way. is this how they are going to reinflate new housing construction… just start over?Bank ‘walkaways’ from foreclosed homes are a growing, troubling trendPosted by Sandra Livingston/Plain Dealer Reporter July 19, 2009 09:00AMJohn Kuntz/The Plain DealerA pair of boarded up windows are overgrown with vines on a foreclosed home on the city’s East Side. Banks are backing away from properties they have foreclosed on creating a new set of issues for neighborhoods.Renetta Atterberry thought she had lost her East 102nd Street house. So she was shocked to learn in January — five years after her mortgage company filed for foreclosure — that it was still in her name.Worse, the long-vacant rental home had been vandalized and she faced a raft of housing code violations. Since then, she has been saddled with debts of about $12,000 to pay for demolition and back taxes.”I thought I had nothing else to do with that home,” said Atterberry. “I was so embarrassed and humiliated by this.”Her mortgage company didn’t buy the house and never took it to sheriff’s sale to see if somebody else would, leaving Atterberry the legal owner, responsible for upkeep and taxes.These so-called “bank walkaways” are another troubling development in the foreclosure crisis, particularly in cities like Cleveland with weaker housing markets, say housing advocates and government officials.Lenders or mortgage companies decide they don’t want homes they have already foreclosed on, sometimes because the value has plummeted or they believe the homes could become costly liabilities if they are socked with housing code violations.But without that sale, the property can languish abandoned and ripe for vandalism. As liens and liabilities mount — creating a so-called “toxic title” — it becomes even harder to transfer the property. Neighborhoods and local governments are left to deal with the mess.”It’s a growing issue. It’s all over the state. It’s not just Cleveland,” said State Rep. Mike Foley. “That kind of lack of respect for communities that banks have made a ton of money off of in the past is infuriating.”Properties left in ‘legal limbo’Joseph Schilling, associate director of the Metropolitan Institute at Virginia Tech and an expert on abandoned property, said the issue of bank walkaways is increasing. Lenders may decide that given low prices and their mounting inventory of foreclosed property, it makes sense to walk away.”But as a result, it leaves the property in this type of legal limbo and it leaves the community and local government really holding the bag,” Schilling said.The problem has gotten the attention of government officials who are trying to fill a void in Ohio law and force companies that foreclose on property to act.State Rep. Dennis Murray of Sandusky is drafting a bill he hopes to introduce in the next two months that would require lenders or mortgage service companies to take foreclosed properties to sheriff sale within a certain time — or see their mortgage lien erased.The lender wouldn’t be required to buy the property — only to take it to sale. More time could be given to lenders working to keep people in their homes by restructuring the mortgage.Under Murray’s plan, property that doesn’t sell could go to a local land bank.”We’re saying fish or cut bait,” Murray said. “You can either take it to sheriff’s sale . . . or if you’re going to walk away from the property, do it now so the land bank process and the reclamation can get started.”Separately, Cuyahoga County Common Pleas Judge Nancy Margaret Russo recently began ordering those granted a foreclosure decree in her courtroom to file the paperwork for a sheriff’s sale in about 30 days — or face being ordered to court for a contempt hearing.”I think it’s a big problem,” Russo said. “It’s creating more abandoned homes with nobody responsible for taking care of them.”It’s not clear whether she has the jurisdiction to issue such orders. But Russo — who was not aware of Murray’s initiative when she began hers — believed it was time to start a discussion.Beachwood lawyer James Sassano, who represents mortgage servicing companies in foreclosure cases, said he doesn’t believe Russo has the jurisdiction but understands that she wants to get properties into the hands of people who would be responsible for them. And while he hasn’t seen Murray’s draft legislation, he questions whether it would be constitutional to erase the mortgage holders’ lien.Frank S. Alexander, a professor at Emory University School of Law, said he’s not aware of any state with a remedy similar to what Murray is proposing.”I happen to like it,” said Alexander, after being told about Murray’s plans. “And it would require lenders to act more cautiously in foreclosing.”And he noted that many states are looking to tighten their foreclosure laws.”I think Ohio because of the magnitude of the problem — particularly in Cuyahoga County — and the longevity of the problem, is out in front on trying to come up with creative solutions.”Practice draws academic interestHow often these walkaways happen isn’t clear, and there are mortgage companies that work to hasten sales.But researchers at the Center on Urban Poverty and Community Development at Case Western Reserve University are studying the issue after noticing that foreclosure filings in Cuyahoga County remained about the same in 2007 and 2008 but that sheriff’s sales were down last year.Researcher Michael Schramm said they also began hearing from people in various cities and neighborhoods about homes languishing in foreclosure without being sold.Schramm said that Cuyahoga County saw more than 14,000 foreclosure filings both in 2007 and in 2008. In 2007 there were nearly 10,000 sheriff’s sales, but the number dropped in 2008 to about 8,000.Lenders or mortgage service companies may decide not to seek a sheriff’s sale because they’re working to restructure a mortgage or the homeowner has gone into bankruptcy. But there’s no doubt they’ve also walked away from homes when it’s in their financial interest to do so.”In the old days when values were much higher, it made a lot more sense to press the foreclosure sale,” said Dave Sarver, whose Cleveland Heights-based Sarver Realty specializes in selling properties taken back by banks at sheriff’s sales.But now, he says, when a growing number of properties are worth only a few thousand dollars, it doesn’t make sense for mortgage companies to take title to properties with little value and the potential for costly city code violations.In Cuyahoga County, foreclosed homes that lenders or mortgage companies bought at sheriff’s sales have recently sold for as little as 30 percent of the home’s previously appraised value, according to the Center on Urban Poverty and Community Development.In the city of Cleveland the numbers are even worse — with lenders selling foreclosed homes for just 15 percent of their former value.Another slice of the dismal pie: In Cleveland more than 60 percent of the foreclosed homes sold by mortgage companies went for $10,000 or less.Some lenders also lose interest during the foreclosure process.”The property becomes abandoned while the foreclosure is pending and it becomes stripped, vandalized, damaged or deteriorated to the point where it just doesn’t make sense to spend money to have it offered at sheriff’s sale,” said Larry Rothenberg, a lawyer with Weltman, Weinberg & Reis, a large creditors-rights firm based in Cleveland.But those business decisions don’t sit well with those left to deal with them.”They have a responsibility,” said Cleveland City Councilman Tony Brancatelli. He said that if lenders or mortgage companies start a foreclosure, they should finish it. Or they should take off the mortgage lien so that the title can be cleaned up and the property transferred into responsible hands.’I see shocked people every single week’Some of the fallout that results when properties languish vacant and abandoned shows up in Cleveland Housing Judge Raymond Pianka’s courtroom.”I see shocked people every single week,” Pianka said. “They thought the burden was lifted because they filed bankruptcy or because somebody somewhere told them they’re no longer responsible, and then they’re pulled back in facing criminal code violations.”His court also has worked with such owners on moving the property into the hands of another owner such as a nonprofit agency, the city land bank or the next door neighbor.But trying to transfer a problem to somebody else can become a thorny and protracted process if the long-gone owner can’t be found or the foreclosed house is saddled with so many financial obligations that it is too expensive to touch.Some transfers have been helped along when lenders remove the lien or agree to what’s called a short sale and accept less than what’s owned on the mortgage.Shawn Martin doesn’t know what will happen to his property on Reno Avenue in Cleveland, where a foreclosure was filed on the two-family rental house in 2006.The sheriff sale had been scheduled, and Martin figured his lender took possession after he drove by and saw the windows boarded up and a tarp on the roof. But nobody bought it — not even his mortgage company.”They backed out on it and just left it without even telling me,” Martin said. “It just sat there and decayed without me even knowing about it.”The house has been demolished and Martin is worried about being stuck with the bill.”This is a nightmare,” he said.Carol Zung’s two-family rental property on Adams Avenue in Cleveland is still standing — and that presents its own set of problems.A few months ago she got a call from police that the empty house had been ransacked, a call that reached her in Savannah, Ga., where Zung moved to find work after a cascade of financial troubles.The house had been foreclosed on and set for sheriff’s sale in November 2007.Whether it even went to sale can’t be gleaned from the court docket, which Zung has been checking in the hopes that this incredibly frustrating burden will be transferred off her 69-year-old shoulders.Now there’s another wrinkle. During a recent check, Zung learned her mortgage holder had gotten the foreclosure decree vacated and the case dismissed. But the property is still in her name and she owes around $37,000 on the mortgage. Zung has been through bankruptcy and said she has no money.”What do I do now?” she said. “There’s part of my mind that’s given up. Let other people figure out this mess.”It is not just the homeowners who are affected when the property languishes.Neighbors can be left to suffer with vandalism and diminished property values, and taxpayers may be left with the costs of removing nuisance and blighted conditions.”Those are the people who are picking up the tab for the business practices of calculated abandonment, ” said Kermit Lind, a clinical professor at Cleveland State University’s Cleveland-Marshall College of Law and an expert on foreclosures.Sarah Butler knows the fear of living next door to a foreclosed and vacant house. From her home on Reno she watched as vandals and trespassers descended on Martin’s two-family after the renters moved out.She saw looters strip the house of everything from gutters to the refrigerator. Once, one of her back windows was broken. And sometimes people would pull into the driveway at 3 a.m. and wake her up with all their noise.”You’ve got to leave, nobody lives here,” she’d shout from her window.Homeowners, too, sometimes walk away — for their own financial reasons or because they feel eviction from their foreclosed homes is inevitable. Once they’re gone they may be hard to track down.But others, like Renetta Atterberry, abandon a house in the belief that it’s no longer theirs. She doesn’t know why she didn’t get notices about what happened.It’s not clear how her housing nightmare will end.She said she’s on a payment plan with the county treasurer’s office for the back taxes and would like to donate the property to a land bank — but said she was told that can’t happen as long as the $48,000 mortgage lien remains on the now-vacant property.”I was totally devastated with all of this being dumped on me,” she said.

There is no recovery underway Guest. Who can argue with the below by Ritholz. As for Cramer, why does he still have a show.======================================On Saturday, I posted this chart and wondered why “Some people were calling for a housing bottom.” That generated a ton of emails asking about for further clarification.The people I referred to were the usual happy talk TV suspects (i.e., Cramer) who have been perpetually wrong about Housing for nigh on 3 years. I not only disagree with them, but don’t respect their opinion — essentially headline reading gut instinct big-money-losers. No thanks.Then there were the slew of MSM who insist each month on reporting that 3% (+/- 11%) is a positive integer. We disposed of that silliness on Friday.But the crux of the email was over this post. There are a handful of people whom I disagree with, but nonetheless have a great deal of respect for their methodology and process. Over the past year, these have included Doug Kass and Lakshman Achuthan and Bill of Calculated Risk. We may reach different conclusions about a given issue, or disagree on timing, but these are the folks whose opinions force me to sharpen my own.When I tossed up that chart yesterday, I had not yet seen Bill’s comments on the subject (McCartney!) but he is one of those people I can respectfully disagree with. We simply have reached different conclusions about the timing and shape of the eventual Housing lows.There are a plethora of reasons why I believe we are nowhere near a bottom in Housing prices or activity. Here are a few:• Prices: By just about every measure, Home prices on a national basis remain elevated. They are now far off their highs, but are still remain about ~15% above their historic metrics. I expect prices will continue lower for the next 2-4 quarters, if not longer, and won’t see widespread Real increases for many years after that; Indeed, I don’t expect to see nominal increases for anytime soon;• Mean Reversion: As prices revert back towards historical means, there is the very high probability that they will careen past the median. This is the pattern we see after extended periods of mispricing. Nearly all overpriced asset classes revert not merely to their historic trend line, but typically collapse far below them. I have no reason to believe Housing will be any different;• Employment & Wages: The rate of Unemployment is very likely to continue to rise for the next 4-8 quarters, if not longer. This removes an increasing number of people from the total pool of potential home buyers. There is another issue — Wages, and they have been flat for the past decade (negative in Real terms), crimping the potential for families to trade up to larger houses — a big source of Real Estate activity. Plus, more unemployment means more . . .• Foreclosures: We likely have not seen the peak in defaults, delinquencies and foreclosures. Many more foreclosures — which are healthy in the long run but wrenching during the process of dislocation — are very likely. These will pressure prices yet lower. And Loan Mods are not working — they are redefaulting in less than a year between 50-80%, depending upon the mod conditions themselves.• Inventory: There is a substantial supply of “Shadow Inventory” out there which will postpone a recovery in Home prices for a significant period of time. These are the flippers, speculators, builders and financers that are sitting with properties that they do not want to bring back to market yet. Given the extent of the speculative activity during the boom years (2002-06), and the number of foreclosures so far, my back of the envelope estimates are there are anywhere from 1.5 million to as many as 3 million additional homes that could come to market if prices were more advantageous.• Psychology: The investing and home owning public are shell shocked following the twin market crashes and the Housing collapse. First the dot com collapse (2000-03) saw the Nasdaq drop about 80%, then the Credit Crisis of 2008 saw the unprecedented near halving of the market in about a year. Last, Homes nationally have lost about a third of their value since the 2005-06 peak. Total losses to the family balance sheet of these three events are about $25 trillion dollars. These losses not only crimp the ability to make bigger purchases, it dramatically curtails the willingness to take on more debt and leverage. Speaking of which . ..• Debt Service/Down Payment: Far too many Americans do not have 20% to put down on a home, have poor credit scores, and way too much debt. All of these things act as an impediment to buying a home. At the same time, to get approved for a mortgage, banks are tightening standards, including 1) requiring higher Loan to Values for purchases; 2) better credit scores to get approved for a mortgages; 3) Lower levels of overall debt servicing relative to income for applicants. Yes, the NAR Home Affordability Index shows houses as “more affordable,” but it conveniently ignores these real world factors.Deleveraging: For the first time in decades, the American consumer is in the process of saving money and deleveraging their balance sheets. After a 40 year credit binge, its long overdue. The process is likely to go on for years, as a new generation is losing confidence in the stock market, Corporate America and their government. Think back to the post-Depression generation that were big savers, modest consumers, who eschewed credit and borrowing. The damage is going to take a while to repair.There are more reasons I expect the Real Estate market to remain punk for many years, but these are a good place to start when considering the question.The Housing Boom & Bust, and the 2002-07 credit bubble created massive excesses. More than anything, it is going to take time to resolve them.

dang. fresh produce being time-sensitive, i’m still scurrying about my busy kitchen and my prolific garden and can’t post again yet – but i can hardly wait to come back and more clearly and fully expose the illogic, omissions, inept and flawed reasoning, and self-contradiction in 67′s post about worker A and worker B.for the moment, and with apologies to deserving others who remain un-heralded by me for now: To IC, yours is a very valuable voice here, and thanks ever for contributing it.

Don`ttease me like that, Geust!

prepare to be hoisted on your own petard, 67

Coming soon to a Theatre near you… if this is true, does anyone think we are not screwed? so much for Obamas transparency…Now how did we go from 11-13T to this? It will be interesting to read this when it comes out.Now playing : Total Bailout = $23.7 TRILLIONHere’s a crazy stat for you. The total amount of US backstops and bailouts has reached a staggering $23.7 billion!How do we know? Because TARP watchdog Neil Barofsky is going to say so in his fresh report, and that report was leaked to many top media outlets, like WaPo and Dow Jones. If it’s available to the public, we certainly can’t find it on the SIGTARP website. The last report that’s up is from April, 21.Presumably, one of Neil Barofsky’s main goals is to promote transparency within TARP. He could start by increasing transparency in his own office, instead of playing footsie with the same old media pals.http://www.businessinsider.com/total-bailout–237-trillion-2009-7===================================WASHINGTON -(Dow Jones)- Government support aimed at cushioning the effects of the financial crisis in the U.S. could reach $23.7 trillion, a special inspector general overseeing U.S. bailout efforts plans to tell Congress on Tuesday.In prepared testimony for a hearing of the House Committee on Oversight and Government Reform, Special Inspector General Neil Barofsky writes the figure includes spending and commitments for several agencies that have implemented programs aimed at supporting the economy and the U.S. financial system.”TARP does not function in a vacuum,” he writes, referring to the government’s $700 billion Troubled Asset Relief Program – its most visible effort to counter the financial meltdown.Still, the committee’s ranking member Darrell Issa, R-Calif., blasted the figure provided by Barofsky, saying “If you spent a million dollars a day going back to the birth of Christ, that wouldn’t even come close to just $1 trillion – $23.7 trillion is a staggering figure.”Barofsky in his testimony provides a breakdown of the government’s TARP expenditures in his testimony, saying Treasury has disbursed $441 billion of the nearly $700 billion authorized under TARP legislation.The government has called the programs investments, but officials have conceded some of those investments – such as $2.3 billion provided to the CIT Group – could result in losses for taxpayers.-By Meena Thiruvengadam, Dow Jones Newswires;

Who is the most stupid and ignorant person? Obama, Reid, Pelosi?

WE’RE IN A RECESSION WITH CHRONIC DEFLATIONWhen did toxic waste loans get hidden in a bunch of globalist alphabet soup acronyms [I'm not going to even pretend I understand it, because talking to banking professionals and financial advisors, they don't either]?I believe this banking mess was started about the time when Seattle protestors were wrongfully arrested during the late 90s WTO brainwashing to get the IMF funded for globalism and let China produce with no environmental or wage restrictions. It was also about the time NAFTA was touted as the godsend for Mexico/America and subsequently China grabbed all the jobs we sent Mexico anyway [that we lost], subsequently sending unemployed Latino into America in hoards to work for our globalist bent slave labor employers and put more and more regular American citiizens on the unemployed lists.Of course most of the horrifying unemployment of globalism in America was covered up around the late 90s when the unemployment rate no longer counted those forced into severely lower wages or severely lower hrs/week. Very convenient timing for the whole Ponzi Scheme to fool most of us.

RETIRE…LOLHow will the boomers do that on 1% money markets or 12 month 25-30% casino losses at the stock market; let alone 20-50% losses in their RE investments?The only retirement investment a good percentage the boomers have that’s worth anything [like several thousand a month income to live on witghout using the principle] is Social Security and its as good as America’s IOUs.I think the work until you die era we had in the great depression is back.

Amen & thanks for sharing your comment.

Here is very good speech by Atlanta Fed President Lockhart. It mostly agrees Nouriel’s view of slow recovery and CRE risk, and provides a good summary of inflationary/deflationary forces. So much better than Bernanke BS.http://atlanta.bizjournals.com/atlanta/stories/2009/07/20/daily13.html?s=du&ed=2009-07-20&ana=e_du_pap&page=3#tp_newCommentAnchor

Bring on your wet squib, Geust.

Well said EconomicminorWhen the amended Federal Policies get to the point that the whole economic system crashes ,it doesnt take too much thought to come to the conclusion that someone “GAMED” the financial system,to their groups short term personal benefit.No one is saying there shouldn,t be income differentials between groups based on a number of well known factors,such as Education ,experience and training ,but when you see the US 2008 Income average wage at $40.00 per hour based on a 40 hour work week,what is this current crap going on? It is not to the benefit of society in general.

THE DONOR AND THE RECEIVER:Govt.’s potential Wall Street, bank support $24TWatchdog: US government potential support of financial sector could approach $24 trillionBy Jim Kuhnhenn, Associated Press WriterOn Monday July 20, 2009, 4:04 pm EDTBuzz up! 17 PrintWASHINGTON (AP) — The federal government has devoted $4.7 trillion to help the financial sector through its crisis, a watchdog report said Monday.Under the worst of circumstances, the report said, the government’s maximum exposure could total nearly $24 trillion, or $80,000 for every American.The figures are part of a tough new quarterly report to Congress from special inspector general Neil Barofsky, who accuses the Treasury Department of repeatedly failing to adopt recommendations aimed at making one component of the government financial rescue effort more accountable and transparent.The $4.7 trillion commitment to the industry equals about one third of the overall U.S. economy and takes into account about 50 initiatives and programs set up since 2007 by the Bush and Obama administrations as well as by the Federal Reserve. Barofsky oversees one of the initiatives — the $700 billion Troubled Asset Relief Program.Much of the government assistance is backed by collateral and Barofsky’s $23.7 trillion estimate represents the gross, not net, exposure that the government could face. No one has suggested that the full amount will be used.Because of declining participation in short-term loan programs and because some infusions of money have been repaid, the maximum amount actually spent has declined to a current outstanding balance of $3 trillion, Barofsky said.The agencies and the programs assisting the financial sector include a newly created Federal Housing Finance Agency, increased deposit insurance initiated by the Federal Deposit Insurance Corp., and 18 support programs created by the Fed under the special powers it can deploy to address a systemwide financial crisis.Banks have cut back on their use of the Fed’s emergency lending program as well as other programs to ease credit stresses. Given that, the Fed has reduced the amount it will lend to financial institutions under two programs and it has decided to let a program to support money market mutual funds to expire as currently scheduled at the end of October.Barofsky’s $23.7 trillion estimate represents the maximum exposure that the government would face if all eligible applicants requested the maximum assistance at the same time. It does not account for the fees and other costs that some of these programs charge and for the collateral that many of the programs require that participants provide.”While quantity and quality of the assets backing all of these programs vary, ignoring that side of these programs misrepresents ‘potential exposure’ associated with them,” Treasury spokesman Andrew Williams said.In his report, Barofsky says Treasury has accepted some of his recommendations for greater accountability, but says the department has not taken steps to require all TARP recipients to report on their actual use of funds. He said Treasury also should report the values of its investments in banks and other financial institutions, disclose the identity of borrowers under a nonrecourse loan program and disclose trading activity under a public-private investment fund.Barofsky says Treasury’s inaction means taxpayers have not been told what the financial institutions that have received assistance are doing with the money.Barofsky’s conclusion is contained in a quarterly report to Congress and in testimony he is prepared to give Tuesday to the House Oversight and Government Reform Committee.”The very credibility of TARP (and thus in large measure its chance of success) depends on whether Treasury will commit, in deed as in word, to operate TARP with the highest degree of transparency possible,” Barofsky said.

Many thanks, Geust!The time I can spend here is very limited and tends to come in spurts, but I do treasure it. Often, there is a conflict between taking time to post and just trying to keep up with the conversation. Like many others on this site, I have many opinions, a few facts, and lot’s of experience, defined as ‘what you get when you don’t get what you thought you would get’.And as for you, 067…keep the temperature elevated, and don’t hesitate to correct my grammer and spelling, too. Maybe one day I will be able to write as smoothly as SWK. When I compare my comments to his, it’s pretty obvious which of us is the street fighter and which is the ajudicator.Independent Contractor

Hi IC, I don`t have any beefs with you as you are clearly a straight shooter and have a ton of life experience. Don`t we all wish we could write with the eloquence of SWK. When I compare his posts with my own, I am a little embarrased.The spelling correction thing was in response to that pup, Jason B, who chided me for the use of the word who instead of whom in one of my posts last evening. Called me an ignoramus, no less, an then proceeded to make 3 spelling mistakes in his next post. I just couldn`t let it pass.

none- i thought of including him too but what was the point.

http://www2.nict.go.jp/y/y223/simulation/realtime/MorbidIts ratcheting up again… wow the sun is a bit active lately

Traded away for a make-believe economy, the real US economy is deadBy Paul Craig RobertsOnline Journal Contributing Writer.http://onlinejournal.com/artman/publish/article_4918.shtmlJul 17, 2009, 00:16.”There is no economy left to recover. The US manufacturing economy was lost to offshoring and free trade ideology. It was replaced by a mythical “New Economy.”The “New Economy” was based on services. Its artificial life was fed by the Federal Reserve’s artificially low interest rates, which produced a real estate bubble, and by “free market” financial deregulation, which unleashed financial gangsters to new heights of debt leverage and fraudulent financial products.The real economy was traded away for a make-believe economy. When the make-believe economy collapsed, Americans’ wealth in their real estate, pensions, and savings collapsed dramatically while their jobs disappeared.The debt economy caused Americans to leverage their assets. They refinanced their homes and spent the equity. They maxed out numerous credit cards. They worked as many jobs as they could find. Debt expansion and multiple family incomes kept the economy going.And now suddenly Americans can’t borrow in order to spend. They are over their heads in debt. Jobs are disappearing. America’s consumer economy, approximately 70 percent of GDP, is dead. Those Americans who still have jobs are saving against the prospect of job loss. Millions are homeless. Some have moved in with family and friends; others are living in tent cities.Meanwhile the US government’s budget deficit has jumped from $455 billion in 2008 to $2,000 billion this year, with another $2,000 billion on the books for 2010. And President Obama has intensified America’s expensive war of aggression in Afghanistan and initiated a new war in Pakistan.There is no way for these deficits to be financed except by printing money or by further collapse in stock markets that would drive people out of equity into bonds.The US government’s budget is 50 percent in the red. That means half of every dollar the federal government spends must be borrowed or printed. Because of the worldwide debacle caused by Wall Street’s financial gangsterism, the world needs its own money and hasn’t $2 trillion annually to lend to Washington.As dollars are printed, the growing supply adds to the pressure on the dollar’s role as reserve currency. Already America’s largest creditor, China, is admonishing Washington to protect China’s investment in US debt and is lobbying for a new reserve currency to replace the dollar before it collapses. According to various reports, China is spending down its holdings of US dollars by acquiring gold and stocks of raw materials and energy.The price of one-ounce gold coins is $1,000 despite efforts of the US government to hold down the gold price. How high will this price jump when the rest of the world decides that the bankruptcy of “the world’s only superpower” is at hand?And what will happen to America’s ability to import not only oil, but also the manufactured goods on which it is import-dependent?When the oversupplied US dollar loses the reserve currency role, the US will no longer be able to pay for its massive imports of real goods and services with pieces of paper. Overnight, shortages will appear and Americans will be poorer.Nothing in Presidents Bush and Obama’s economic policy addresses the real issues. Instead, Goldman Sachs was bailed out, more than once. As Eliot Spitzer said, the banks made a “bloody fortune” with US aid.It was not the millions of now homeless homeowners who were bailed out. It was not the scant remains of American manufacturing — General Motors and Chrysler — that were bailed out. It was the Wall Street banks.According to Bloomberg.com, Goldman Sachs’ current record earnings from their free or low cost capital supplied by broke American taxpayers has led the firm to decide to boost compensation and benefits by 33 percent. On an annual basis, this comes to compensation of $773,000 per employee.This should tell even the most dimwitted patriot who “their” government represents.The worst of the economic crisis has not yet hit. I don’t mean the rest of the real estate crisis that is waiting in the wings. Home prices will fall further when the foreclosed properties currently held off the market are dumped. Store and office closings are adversely impacting the ability of owners of shopping malls and office buildings to make their mortgage payments. Commercial real estate loans were also securitized and turned into derivatives.The real crisis awaits us. It is the crisis of high unemployment, of stagnant and declining real wages confronted with rising prices from the printing of money to pay the government’s bills and from the dollar’s loss of exchange value. Suddenly, Wal-Mart prices will look like Nieman Marcus prices.Retirees dependent on state pension systems, which cannot print money, might not be paid, or might be paid with IOUs. They will not even have depreciating money with which to try to pay their bills. Desperate tax authorities will squeeze the remaining life out of the middle class.Nothing in Obama’s economic policy is directed at saving the US dollar as reserve currency or the livelihoods of the American people. Obama’s policy, like Bush’s before him, is keyed to the enrichment of Goldman Sachs and the armament industries.Matt Taibbi describes Goldman Sachs as “a great vampire squid wrapped around the face of humanity, relentless jamming its blood funnel into anything that smells like money.” Look at the Goldman Sachs representatives in the Clinton, Bush and Obama administrations. This bankster firm controls the economic policy of the United States.Little wonder that Goldman Sachs has record earnings while the rest of us grow poorer by the day.”…and this too…..”Myths and legends die hard in America. We love them for the extra dimension they provide, the illusion of near-infinite possibility to erase the narrow confines of most men’s reality. Weird heroes and mold-breaking champions exist as living proof to those who need it that the tyranny of “the rat race” is not yet final.”– HUNTER S. THOMPSON, 1937-2005.the rat race, the final frontier? ha.

and after further inspection it became clear thatthese quotes have once again and belatedly founda new home…….”We are turning into a nation of whimpering slaves to Fear—fear of war, fear of poverty, fear of random terrorism, fear of getting down-sized or fired because of the plunging economy, fear of getting evicted for bad debts or suddenly getting locked up in a military detention camp on vague charges of being a Terrorist sympathizer.”—”Extreme Behavior in Aspen,” February 3, 2003.”In a nation ruled by swine, all pigs are upwardly mobile—and the rest of us are fucked until we can put our acts together: not necessarily to win, but mainly to keep from losing completely. We owe that to ourselves and our crippled self-image as something better than a nation of panicked sheep.”—The Great Shark Hunt, 1979.”There are times, however, and this is one of them, when even being right feels wrong. What do you say, for instance, about a generation that has been taught that rain is poison and sex is death? If making love might be fatal and if a cool spring breeze on any summer afternoon can turn a crystal blue lake into a puddle of black poison right in front of your eyes, there is not much left except TV and relentless masturbation. It’s a strange world. Some people get rich and others eat shit and die.”—Gonzo Papers, Vol. 2: Generation of Swine: Tales of Shame and Degradation in the ’80s, 1988

.The trouble with moneyBy Kéllia RamaresOnline Journal Associate EditorJul 15, 2009, 00:22.The current economic crisis is bringing monetary reform movements such as End The Fed, to the fore. These movements bring to light what is wrong with our current monetary system, i.e., it is the instrument by which people are held in debt slavery.But these movements often call for a return to the backing of paper money with gold and silver. In other words, that we should be able to redeem our paper money for gold and silver – though I can’t think of why we would want to do that — gold and silver are too heavy to carry around. No more paper currency should be in circulation than can be backed by precious metal, according to the proponents of “real money.”But returning to a gold/silver standard for currency will not stabilize our economy. The real problem with our currency is not its fiat nature. Gold and silver are themselves fiat currencies. Long ago, certain cultures decided that these metals were valuable and could be used to transact business. Cultures that did not have access to these metals used something else: shells, feathers, rocks, etc. to facilitate exchange. The decree of some ancient king to use gold and silver as currency is just as much a fiat as the decision of the US Government to use Federal Reserve Notes. We just don’t consider gold and silver as fiat currency because the decision to use them as currency was made millennia ago. The value of gold and silver is a fundamental assumption, part of our “racial memory” that we do not question. But there is nothing in the natural order of the world that decrees that these metals are valuable. It is only an ancient consensus, still honored, that makes them so. Thomas Nast, the great 19th century American political cartoonist, and a “hard money” enthusiast, was right when he drew a cartoon saying that Congress could declare soft soap to be the currency. Indeed, if Ancient Greece and Rome had made such declarations, I wonder what we would be washing ourselves with today.The immediate problem with our currency is not its fiat nature. The trouble with money is interest. Ancient religions forbade interest — Islam still retains that proscription. They saw time as a gift from God. But that consensus broke down and interest as a payment for the time a lender would be without his money came into being. Interest is what has made every business transaction into one of debt. It also requires the world’s economy to be in a state of permanent growth because growth is needed to expand the money supply in order to pay back loans PLUS interest. If there were no interest and people with surplus money loaned it to those who needed it, the repayment would simply be the return of the sum loaned and the money supply would not need to grow just so that each loan can be repaid with interest. This is not unheard of; it’s something friends do amongst each other.As the foes of fiat currency correctly point out, increasing the money supply decreases the value of each dollar in circulation. They would propose to limit inflationary increases in the money supply by tying paper currency to the limited supply of gold and silver. But that could cause the problem of needlessly restraining real growth because of an insufficient money supply. I say, attack the problem of inflation at the taproot by abolishing interest. (A way to eliminate interest and still provide incentive for money to circulate is the focus of the book “Interest and Inflation Free Money: Creating an Exchange Medium That Works for Everybody and Protects the Earth” by Margrit Kennedy. It’s published by New Society Publishers).The need to always grow the economy to pay interest is unsustainable. No system grows forever. The linear view of the Universe is not natural. Nature operates in circles and spirals, not in straight lines. The human hubris that we have dominion over the earth and can subdue it is folly. Mother Nature bats last. We are playing on her field.And Her game is about resource depletion — not just oil, but other resources, such as potable water — brought about by a species that thinks that infinite growth on a finite planet is possible and desirable. Interest is how that species puts its belief into action.Ecology and economy are two words that come from the same root. We must remember this whenever we hear politicians say that we can’t take certain measures to protect the environment because they will hurt the economy. Without the environment, there is no economy. Therefore, we must abandon the belief in the possibility and desirability of infinite growth. We must also abandon the demand for compensation for every instance of use of anything valuable that we possess, including and especially time. (Contrast the copyright battles over usage of one digital product across several pieces of equipment with the way you freely share time and resources with your social circle). Once we abandon those old ways of thinking, the wisdom of eliminating interest, which is based on those old ways, will be self-evident.And what will happen to the people who make their living from lending at interest? I say to them what the working class has been told time and again in the face of outsourcing: RETRAIN.Of course, the elimination of interest is only one step toward what should be the ultimate goal: the elimination of money. That, too, can be accomplished with a massive change of thinking leading to a new consensus that no longer supports monetary systems. But for now, one thing at a time.Copyleft 2009 Kellia Ramares. Non-profit distribution with credit is highly encouraged.Kellia Ramares, 53, is a freelance journalist in Oakland CA, who is tired of seeing how lack of money impedes good work. She can be reached at kelliasworld@yahoo.com. She can also be followed on twitter.com/kelliasworld and friended at facebook.com/kelliasworld. Her web site, Kellia’s World, is at http://kellia.ning.com.

g,we, as in, “we the people”.

w,correct.

Quite the point Softwarengineer. There is no recovery to speak of, not now and not for many years because precisely the Boomers will be absent. They have been roundly screwed as the articles outline and therefore will not participate in the spending needed to create a US economic recovery.Recover, in fact for the US, is a myth. Flatlining or a long series of ever lowering ledges in economic activity for a decade and more is more likely.

And this will provide the motivation to spend into a recovery?http://www.mybudget360.com/negative-equity-nation-for-1-out-of-5-homeowners-the-psychology-of-the-10-million-american-homeowners-with-zero-equity/”Recovery” is a myth. A fairytale. Hopium for the masses.

Does it rank pari passu with Social Security and Medicaid ?

Utter non-sense. I guess we could all go back to living in grass huts that we made ourselves, but do we really want to go there?

Pelosi, pretty much all democrats are clueless morons.

Hi, RichI just had a great weekend after a long, stressful period of intense work. It was sooooo relaxing – and yes, it did help me regain perspective on the world. Nothing is ever as good or as bad as it first appears.As for the dollar, I have been watching too. The inverse correlation between equities and the dollar has been a very striking feature of the past year’s action. I’m expecting that just as in Q4 last year, when the global markets crash again (what the MSM calls “risk aversion”), the dollar will strengthen again (what the MSM calls “flight to quality”) as US banks/investment banks loot global markets to pay themselves huge margin calls and derivatives resets in advance of culling further the global competition. Those with memories will recall that this was the off-the-screen action behind the Lehman take down.As for timing, it will likely be just when Washington and Wall Street are most fearful of a Treasury auction failing – and will likely be combined with a few of those political events (riots, assassinations, bombs) and financial events (revelations of fraud, margin call defaults, etc.) which marked the last round in 2008. This time I think they’ll add attacks on government debt in Europe, undermining UK, Ireland and other soft targets.If I had to guess, I’d say early October, so they can ramp up again before closing the books at the end of the year with some more leveraged taxpayer money.I’m glad to be out of the markets with a day job for now. I’m in cash, and looking to hold that as safely as possible.

IC and 0067:Thank you for your respective compliments, which are acknowledged and very much appreciated.Kindest regards to you both,SWK

something is not making sense. Tax revenues accross the board are tanking, unemployment is rising, yet the indcators they put out are better? just like the banks and financials i Have to believe they are manipulating numbers everywhere these days.US state budgets hit by shrinking tax takefrom FT Times.Sharply falling tax revenues across the US have left states facing fresh budget shortfalls and threatening further painful spending and service cuts following previous multiple rounds of belt-tightening.In the first quarter of the calendar year, tax collections dropped by 11.7 per cent, the largest fall on record, according to the Rockefeller Institute of Government. Of 50 states, some 45 reported declines.Early figures for April and May show an overall decline of nearly 20 per cent for total taxes, “a further dramatic worsening of fiscal conditions nationwide”, says the institute.Billions of dollars of federal stimulus funds, combined with cuts to state employee jobs, school districts, healthcare and even the US prison system, have so far failed to close the budget gaps.“The states are constantly trying to recalibrate their budgets to deal with a shrinking revenue base,” said Susan Urahn, managing director of state policy initiative at the Pew Center on the States.It raises questions about how deep the decline in services may go, the direction of tax rates, and whether the federal stimulus measures are working.Interactive graphic: Deficits in US state budgets – Jul-20Obama refuses to stall on health drive – Jul-20“Clearly, states are enacting cuts in spending that are reducing aggregate demand and slowing down the recovery,” said Nicholas Johnson, director of the state fiscal project at the Center on Budget and Policy Priorities, a research group that focuses on fiscal policy and public programmes that affect low- and moderate-income families and individuals.“While they are not as great as they would be without the first round of stimulus, they do raise the question of whether additional federal aid is appropriate,” Mr Johnson said.Most US states must enact balanced budgets, and 46 of the 50 have fiscal years beginning on July 1. Already individual states from Maryland to Colorado are warning that deficits have reopened.California has resorted to issuing IOUs for payments such as welfare checks amid a stalemate over how to close its $26bn (€18.3bn, £15.7bn) shortfall.“Lawmakers just close gaps and more open ahead of them,” said Corina Eckl, director of the fiscal affairs programme at the National Conference of State Legislatures, a bipartisan research group for the states. “We still have a long way ahead of us on these problems.”The US had faced a projected cumulative budget gap of $143bn for fiscal 2010, according to data released on Monday by the NCSL.The problems do not end there: nearly two-thirds of states are projecting budget gaps for 2011, when far less stimulus will be available, and at least 15 states are already projecting gaps as far out as 2012, when federal aid is minimal, the NCSL study shows.In reply to a question on the need for a second stimulus at a June 23 press conference, President Barack Obama said: “Well, not yet, because I think it’s important to see how the economy evolves and how effective the first stimulus is.”The Obama administration’s $787bn stimulus package dedicated about $165bn to the states, including $87bn for Medicaid, $48bn in a special fund for education, childcare and community development.A third prong consists of funding for infrastructure projects, meant to boost state economies by producing jobs, offsetting but not plugging budget gaps.Analysts who specialise in state finances say the stimulus is filling up 30 to 40 per cent of the budget deficits, which is slightly less than had been anticipated because economic conditions turned out to be worse had been expected.Texas and Nebraska filled nearly all their budget gaps with stimulus money while Kentucky, South Carolina, Vermont and New Mexico closed half of their budget gaps with federal money, the NCSL said.The recession is putting enough of a drag on employment and spending that tax receipts throughout the country are successively worse than expectations, which means lawmakers must keep cutting back.“It appears that the state budget is once again being overwhelmed by the deteriorating economy,” Warren Deschenaux, the main fiscal analyst for Maryland’s General Assembly, wrote in a letter to state lawmakers earlier this month warning of a $700m shortfall.Maryland’s governor is working on a slew of new cuts. To fill a previous $2bn gap, the budget already included $1bn of stimulus funds, 1,000 state job cuts and a 23 per cent reduction in spending for centres for the disabled. That is after $2.2bn in spending cuts the year before. The state has decided to borrow money it needs for housing and environmental projects, among other things.Mr Deschenaux projects a $1bn shortfall for next year. “The situation confronting Maryland is extremely challenging,” he wrote, “and will only get more so as the stimulus is withdrawn.”

He has no Strategy. Big oil is effectivley crushing the Solar industry now too. Most Green energy Companys have been downgraded recently. I wonnder why? Now who would want to go into that industry to start a company?I’m neither a Dem or a Rep and Obama is starting to make Bush look smart and he was the dumbest president we ever had. as some one wrote above about Obama, Pelosi, reid, et al being stupid and ingnorant, I have to agree. Doesnt mean they are not nice people, thye jsut don’t have a clue.Obama’s Strategy to Reverse Manufacturing’s FallDouglas Bartlett recently closed his printed circuit board factory, Bartlett Manufacturing Company in Cary, Ill., because the property taxes were no longer affordable.If the Obama administration has a strategy for reviving manufacturing, Douglas Bartlett would like to know what it is.The United States ranks behind every industrial nation except France in the percentage of overall economic activity devoted to manufacturing — 13.9 percent, the World Bank reports, down 4 percentage points in a decade. The 19-month-old recession has contributed noticeably to this decline. Industrial production has fallen 17.3 percent, the sharpest drop during a recession since the 1930s.So far, however, Mr. Obama’s administration has not come up with a formal plan to address the rapid decline. Instead, it has pursued ad hoc initiatives — bailing out General Motors and Chrysler, for example, and pushing green energy by supporting the manufacture of items like wind turbines and solar panels.”Bush and Obama,” Mr. Bartlett said scornfully, “one is as bad as the other in terms of manufacturing policy.”rest:http://www.nytimes.com/2009/07/21/business/economy/21manufacture.html?_r=1&ref=economy

and MSM is putting a POSITIVE spin on CAT’s numbers as well as the market??? Have they all gone “Koo Koo for cocoa puffs?”

they are fixing 12 Billion of this with accounting tricks and trying to collect taxes early. Duh- taxes are tanking… look at the hit to Education and “community Colleges” (Was’nt Obama hanging his hat on this last week how important it was). A post earliar in this talks about the destruction to College education. look at K-12 hit. California, the largest state with the most kids in school is already ranked 49th in quality. So what will the largest state now be contributing to Americas future and economic health? already less than 65% of the kids graduate HS. They are counting on local and County revenues, Well guess what, taking form them only passes problems to them.By November Calif will be back in the news with at least another 20 Billion shortfall. Already the current problem was well over 30 Billion, they just dont know it or refuse to acknowledge that tax colelctions are tanking.This is just another example of living to fight another day, just like all the other Bailouts.California hopes to end IOUs with budget agreementSACRAMENTO, Calif. — California may soon be able to stop printing IOUs now that Gov. Arnold Schwarzenegger and legislative leaders have agreed on a compromise plan to close the state’s $26 billion shortfall without tax increases.The governor and lawmakers announced the compromise late Monday, nearly three weeks after the state began issuing pay-you-later warrants to thousands of state contractors and vendors. Many recipients had trouble finding someone to take them after several major banks stopped accepting IOUs.The four legislative leaders will begin selling the plan to other lawmakers Tuesday as the best way to get the state back on firm financial ground and prevent further sinking of the state’s credit rating, already the lowest in the nation. A contentious vote is expected Thursday.The agreement composed of cuts, borrowing and fund shifts was not expected to resolve California’s financial problems as the economy continues to struggle and tax revenue lags far behind the level of the boom years.”This is, of course, one of the most difficult economic times to face our state since the Great Depression, so none of these were easy choices,” said Assembly Minority Leader Sam Blakeslee, R-San Luis Obispo. “I think we selected a path which will lead the state back to the point where we will be strong.”Personal income fell this year in California for the first time in 70 years, leading to a 34 percent plunge in income tax revenue during the first half of the year.The $26.3 billion shortfall amounts to nearly 30 percent of the state’s general fund, the account that pays for day-to-day state services. The sheer size of the deficit meant that any effort to balance the state’s books would be felt throughout the state, from college students seeing a sharp increase in fees to local police and fire departments that face cuts as the state takes about $4 billion from city and county governments.Monday’s agreement reduced general fund spending from $92 billion to $88 billion, taking California back to 2005 levels.The compromise includes billions in cuts to education, health care, prisons, welfare and other programs. The rest of the deficit will be made up by a combination of borrowing from local governments, shifting money from other government accounts and accelerating the collection of certain taxes.The cuts include $6 billion to K-12 schools and community colleges. Nearly $3 billion will be cut from the California State University and University of California systems, while the state prison system will be cut by $1.2 billion.Medi-Cal, the state’s health program for the poor, will be cut by $1.3 billion.Welfare, in-home support services and a health care program for low-income children also would suffer cuts but would not be eliminated as Schwarzenegger had originally proposed.In exchange, the budget includes some of the reforms to social programs Schwarzenegger desired, including changing the duration that welfare recipients can continuously receive benefits.Schwarzenegger also succeeded in having a proposal to expand oil drilling off the Southern California coast included in the budget agreement.Under that plan, drilling would be allowed from an existing rig off the Santa Barbara coast, generating about $1.8 billion in revenue over time. The proposal, opposed by many conservation groups, would be the state’s first new offshore oil project in more than 40 years.The governor will get authority to sell some state assets, such as the Orange County Fairgrounds and state office buildings. He initially proposed selling high-profile properties such as San Quentin State Prison and the Los Angeles Memorial Coliseum, but those sites were not included in the agreement.Some state parks also will have to close, but the majority of the 220 initially scheduled to be shut down will remain open.”This is a sober time because there isn’t a lot of good news in this budget,” said Senate Majority Leader Darrell Steinberg, D-Sacramento. “We have cut in many areas that matter to real people but I think we have done so responsibly.”Small business owner Linda Rhodes praised Schwarzenegger for holding out for a budget that didn’t raise her taxes, even though her business is staying afloat with state-issued IOUs.”I do not want them to raise taxes. I will take vouchers over them raising our taxes,” said the owner of Rhodes Consolidated Inc. in Galt, 30 miles south of Sacramento.The family firm has just four employees: Rhodes, her husband, Fred, and their two adult daughters. It supplies state agencies with plumbing and electrical equipment like air conditioners, along with other hardware.Vendors were not the only ones affected by the cash crisis.Some 200,000 state government employees already have been ordered to take three days off a month without pay, the equivalent of a 14 percent pay cut. Those furloughs will continue through next June, shutting many government offices for three Fridays a month.The leader of the largest state employees union declared the furloughs “just plain wrong,” and criticized Schwarzenegger and lawmakers for refusing to include tobacco and oil taxes in the plan.”We’re furious about the failed leadership in Sacramento,” said Yvonne Walker, president of the Service Employees International Union Local 1000. “Their decision shows a lack of political courage to stand up to corporate giants and wealthy special interests.”Associated Press Writers Don Thompson, Juliet Williams and Samantha Young contributed to this report.

Blindman See-er, have you ever read Alfie Kohn’s “No Contest – How we lose in our race to win”? (you can read the first 4 chapters online for free)I swear it’s a book that could and should change the world all by itself…and I’d dearly love to know what you think of it.If I could be world dictator for five minutes, I’d make it law the whole world reads that book and whoever doesn’t forever holds their tongues.

At least in France you can get good cheese and other delicacies from non-GMO source materials that still have flavor and won’t leave you sterile.

Tax the value of land and tax nothing else, and all your offshoot troubles from failing to do this sensible thing go away.

I have to be missing something. I have been looking at the numbers of these companies reporting and I see it differently. Tanking revenues/Sales, major cost control intitiatives in the form of job cuts, non-exisistant forward looking projections or weak or no growth projections. In the old days these would all be reasons not to own a stock. And add Small and Medium size buisness {that account for 70% of the US Economy/and jobs and what we produce) and the fact they are going out of buisness at an alarming rate – I have to be missing something.

Ben’s Testimony – He comments on Fed Transparency and accountability at the end.http://www.federalreserve.gov/newsevents/testimony/bernanke20090721a.htm

AND I SIT HERE AND LISTEN TO BERNAKE THIS MORNING SPEWING ALL HIS BS LIES… UNBELEIVABLE… I DONT CARE WHAT THEY ARE SAYING ABOUT A RECOVERY, IM SMART ENOUGH TO KNOW THEY ARE SCREWING US FOREVEER NOW AND THAT THIS WILL BE MANY TIMES WORSE THAT THE “GREAT DEPRESSION” FOR MANY YEARS TO COME! And if people think that’s negative, i’ll leave a scorecard when I pass in about 30-40 years and we’ll see who was right.The Cumlative damage of everything that has happened is inescapable! The lies, the BS, the “fixes” the “printing”, the “policies” they are killing what What Average Joe American has stood for over 200 years…

IS THIS THE PLAN or do things just randomly happen?At this point in time, it appears that a tremendous consolidation in nearly every industry is occurring leaving those standing with very little competition. Will we become a country subserviant to the whims of Goldman Sachs, JPM, BoA and Walmart?

@SWKRe your exchanges with 0067 about taxes, the following piece was included in today`s Gartman Letter. It was written by Ms. Terry Savage, who writes a column for the Chicago Sun-Times. I`d appreciate your thoughts.As we hear more talk about “tax increase on the wealthy” to fund various proposals, I thought you might like this perspective on the history of tax cuts vs. tax increases.Economists, philosophers, and politicians have understood this simple bit of common sense throughout the ages – and surely, so should you. It defies political parties, demagoguery, and dictatorship. It is intuitive, understandable – and provable. Yet it is forgotten in the heat of the moment, and must be relearned by every generation — a very costly lesson.Raising tax rates above a certain level actually reduces tax revenues!President John F. Kennedy said it clearly on November 20, 1962:”It is a paradoxical truth that tax rates are too high and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now …Cutting taxes now is not to incur a budget deficit, but to achieve the more prosperous, expanding economy which can bring a budget surplus.” Under Kennedy, the top personal tax rate was cut from91 percent to 70 percent. He didn’t live to see the socalled “Kennedy boom” that followed. But in the four years following the Kennedy tax cuts, federal tax revenues grew at 8.6 percent, four times the rate of the four years preceding the tax cuts.The idea of collecting more tax revenues from lower tax rates has its roots in antiquity. In the 14th century, the Muslim philosopher Ibn Khaldun, wrote in his 14th century work The Muqaddimah: “It should be known that at the beginning of the dynasty, taxation yields a large revenue from small assessments. At the end of the dynasty, taxation yields a small revenue from large assessments.” And the great economist, John Maynard Keynes, wrote in 1942 about the British economy: “Nor should the argument seem strange that taxation may be so high as to defeat its object, and that, given sufficient time to gather the fruits, a reduction of taxation will run a better chance than an increase of balancing the budget.” By the time the Laffer Curve was popularized by economist Arthur Laffer during the Reaganadministration, the common sense idea that the way to increase tax revenues is to cut tax rates, had been embraced through the centuries and around the world.The 1981 Reagan tax cuts (Kemp-Roth) cut marginal tax rates 25 percent across the board, over a threeyear period. The top tax rate immediately dropped from 70 percent to 50 percent. Allowing for the delay in response because of the delayed impact of the tax cuts, in the four years before 19823, Federal tax revenues had fallen at an annual rate of 2.6 percent. After the tax cuts were fully phased in, deral revenues grew at 2.7 percent. And tax revenues from the wealthy increased, despite the huge cut in the top tax rate. (For detailed statistics and background on the above, please use this link to a fascinating paper written by Dr.Arthur Laffer:http://www.yorktownuniversity.com/documents/The_Laffer_Curve_Past_Present_and_Future.pdf.History tells us what happens when sensible tax policies are enacted. Tax cuts produce increased tax revenue and economic growth. Politicians (both parties) produce spending – and deficits! Historyshows that to be true in practice as well as in theory.The Temptation of Taxes.There’s a double temptation to raising taxes, in spite of the lessons of history. The first is that simple belief — though proven wrong by experience – that raising taxrates will bring in more tax revenue. The second temptation is the belief that raising tax rates on the wealthy will bring more “equality” or “fairness” to the system. Again, history shows that doesn’t work in practice, though it might sound attractive in theory. People who are smart (or lucky) enough to earn more, tend to besmart enough (or get financial advice) that enables them to change their earning patterns, actually paying less in taxes.The Beatles famously wrote about the “Taxman” – who said “19 for you, and one for me” – referring to the confiscatory top 95 percent tax rate in Britain at the time. And they left. In 1971 the Rolling Stones left England for France to escape high taxes. When Swedish taxes soared, tennis star Bjorn Borg and Ikea founder Ingvar Kamprad fled the country, taking their money with them. Don’t think that leaving will be an option in America. Just a year ago, in the “Heroes Act” passed by Congress in June, 2008, Congress resolved that anyone voluntarily giving up his or her citizenship will be taxed on all of his assets as if he or she had sold them — paying capital gain on assets that have increased in value, even though they have not beensold. Leaving America would be a drastic step. But certainly, higher tax rates will cause smart, wealthy people to rearrange their work habits. It’s not a bad decision to value leisure over work, if you are doing most of your work to pay for someone else! And in high tax states like New York, some of the current proposed tax increases on the top brackets would put the total tax bite near 60 percent.An Interesting ProposalDid you happen to notice an interesting op-ed piece in the Wall Street Journal on Tuesday, July 14th? Peter Ferrara of the Institute for Policy Innovation (and a former White House aide to President Reagan) wrote about a radically different solution to our tax problem.He proposes a zero tax rate for the bottom 60% of earners! In exchange, they would no longer receive all those “refundable credits.” That proposal, says Ferrara, would actually be revenue-neutral–that is, it would produce the same revenues, but with far lower costs and much less bureaucratic paperwork. And for the remaining top 40% of income-earners, Ferrara proposes a flat 15% tax–something he also says would be revenue-neutral, if you take into account the fact that people do change their behavior to respond to incentives. That is, instead of hiding money or quitting work because of high tax rates, the most productive people would get incentives to work harder, start more businesses, and earn more money–becausethey could keep 85% of what they earn! The result of lower rates would be higher tax revenues. You can read more about Ferrara’s proposal at http://www.ipi.org.What to Do NowBut the lines have been drawn politically, which is truly unfortunate. It’s difficult to stand against the desire to have government give us things which we truly need. That includes guarantees against loss of money in the bank, benefits to mitigate the loss of jobs and family income, help to finance mortgages on homes that have fallen below the value of the loan, and now healthinsurance for all. And I fear that the lines are hardening socially, as well as politically.We are in the midst of a great national debate about healthcare and other issues that matter deeply and are truly goals worthy of our society. But they can be paid for only through economic growth. And higher taxes have worked against growth throughout history. As thephilosopher Santayana said: “Those who cannot remember the past are condemned to repeat it.”

Lighten up Kilgores. A lot of the comments here are far from the product of thinking adults. Who are you, the blog cop?

Next ticking time bomb here in Calif. Calpers lost 56 Billion last year – down 23%… California’s largest public pension fund. hold on to your cash all you CA retirees and if your not retired you should be worried…

MM CA New jobs being created below.Mobile ice cream vendors on a rocky roadTruck drivers’ sales have fallen amid the recession, while job cuts are drawing more people to the business, boosting competition.After he was laid off last fall from his job driving a delivery truck, Ricardo Lara couldn’t find another full-time position that would pay the bills. So he went into business for himself driving an ice cream truck.The trade group doesn’t track industry data, but Mike Johnston, president-elect of the association and owner of distributor Southern Ice Cream Corp. in Stafford, Texas, said the industry had seen an increase in newcomers mostly where unemployment rates are high.That would include Los Angeles County, whose official unemployment rate soared to 11.3% in June from 7.4% a year earlier.Continental Ice Cream Co. in Los Angeles is an ice cream products distributor and one of the 34 overnight parking locations approved for ice cream trucks by the Los Angeles County Health Department. Almost all of Continental’s 70 parking spots are rented, manager Mauricio Funes said.A sister company of Continental has boosted its supply of ice cream pushcarts because of demand from people looking for unskilled work, he said. Last year, the company was running about 15 carts a day. On a recent weekend, 50 of the 55 carts were spoken for, he said.”This year, a lot of people come and ask for a job,” said the former ice cream truck driver.LA Times

psst psst kilgores – a savvy Florida lawyer wrote this a while backCATALOGUE OF BOGUS CONSERVATIVE IDEAS________________________________________Ann Coulter tells us that if liberals had any ideas or knew any facts they would stop being liberals. In fact, conservative ideas have been put to the test lately. They haven’t held up very well. Here is a short list of bogus conservative ideas. As I worked through these, I realized that they flow one into the other. It makes for a nice orderly destruction of the entire conservative ideology.Bogus Conservative Idea #1. Cutting taxes stimulates the economy and leads to increased revenue. A corollary of this is that higher taxes strangle economic growth.Of course, we now have two distinct examples of tax cuts that directly led to deficits. The conservatives say that those deficits were caused by a failure to reduce spending. But that contradicts the theory of “voodoo economics”. Economic stimulation is supposed to drive up revenues and pay for the tax cuts. Hasn’t happened yet.Then there is the experience following Clinton’s deficit reduction act. You will recall that act contained the “largest tax increase in history”. The result was a dramatic increase in revenue — far more pronounced than the eventual increases in revenue under Reagan, that basically tracked increases in GDP. The conservatives say that economic growth drove up those revenues, but again this undercuts voodoo economics. Clinton raised tax rates on the top, and the economy boomed anyway.”Voodoo economics” is dead as a hammer. Even conservatives are now reduced to arguing, “well, deficits aren’t so bad”.And of course, the “facts” that justify the liberal interpretation are found at a conservative web site. Perhaps you’ve heard of it. It’s called the “Heritage Foundation”.[LINK](see the link at bottom of this post)Bogus Conservative Idea #2. Deficits “aren’t so bad”. There are several ways to debunk this nonsense.First of all, tax cuts that lead to deficits aren’t tax cuts at all. They’re tax deferments. They postpone the day when today’s expenditure must be paid for. Sooner or later, the bill has to be paid — with interest. Whatever evil results from raising taxes, sooner or later you will have no choice. In fact, we can think of Clinton tax increases as Reagan’s tax increases, since we had deferred paying them while Reagan was President. Unfortunately that isn’t really accurate, since the increase in debt under Reagan is still with us — Dubya having decided that paying down our debts wasn’t a priority.Second is the drain deficits place on finance capital. It’s actually somewhat hard to fathom why deficit driven tax cuts would stimulate the economy. Government spending takes money out of the private economy one way or the other, either as taxes, or as money spent buying government bonds. Only the bonds have to be repaid with interest. Meanwhile, some economists believe that deficit spending drives up interest rates. This is supported by the fact that structural interest rates were much higher under Reagan and Bush. Clinton enjoyed the lowest interest rates in a generation, after he balanced the budget.But if you doubt the eventual inflationary pressure of deficits, you need to wake up to an ominous fact of life. The dollar is weakening against foreign currencies. US bonds have been a traditional “safe haven” investment for years. A weakening dollar changes that. If the dollar weakens too much, the government may be begging hat in hand for finance capital, raising its bond yields, with other interest rates following suit.Can you say inflation? Can you say fiscal crisis from hell?Bogus Conservative Idea #3. Liberalism is “destroying America”. Other variants include, “liberals are “collectivists”, “socialists”, “communists” “Stalinists”. Insert your totalitarian reference here. If this were just rhetorical hyperbole, I wouldn’t pay any attention to it. But some of these conservatives appear to actually believe it. In fact, I have presented the facts — you know the things we liberals don’t have any of — and I still see this utter hogwash mouthed by conservatives.First of all, as I have pointed out elsewhere, it helps to know what “communism” really is. A few of the highlights. Communist countries have no or very little private business. The Communist manifesto calls for the abolition of land ownership. Centrally planned “command economies” are a central feature of Communist governments. And of course, Communist governments all have a “gulag” like police state.So where is America’s gulag? How many political prisoners did FDR, Truman, LBJ or Bill Clinton have? What was the name of our central planning agency? And when have Democrats even advocated — much less passed — anything like abolition of land ownership. Our FHA has in fact broadened land ownership, not restricted it. And how many personal fortunes have been built since the beginning of the New Deal in 1933. Where are your “facts” conservatives, to support this “liberals are really communists” crapola?As for destroying the country, consider these unemployment numbers. This is the unemployment rate on the last day of the Truman, Johnson and Clinton administrations, respectively. 2.5%, 3.5% 4.5%. Under Clinton’s presidency, unemployment dropped below 5 percent for the first time in 27 years. Yes, I know about Jimmy Carter, he left with 7.5%, the same percentage he came in with. Now look at unemployment on the last day of the Hoover, Eisenhower, Ford, Reagan, and BushI adminstrations. 25%, 6.5%, 7.5%, 5.5%, 7.5%. For Hoover that’s twenty five not two point five. Only Reagan left office with lower unemployment than he inherited, and his finishing unemployment rate pales beside that of Democratic administrations. Pitiful isn’t it?And of course, we know about the explosion in deficit spending under Reagan, BushI and now BushII. Under Clinton, he ended his presidency with a budget surplus, low interest rates, low inflation, and low unemployment — the same conditions that prevailed in every other Democratic administration except for one. Kennedy/Johnson sent men to the moon, in the age of the Detroit “muscle car”. The modern suburban middle class was born after the war, when Democrats controlled Congress and occasionally the White House. New Deal and Great Society initiatives are so popular, even George W. Bush praises them.All of which proves that we liberals sure are doing a lousy job of “destroying America”. Patriotic conservatives on the other hand, what with high unemployment and huge deficits, seem to be doing a much better job — of “destroying America” that is.Ouch!Bogus Conservative Idea #4. “Trickle down” economics. This is the underlying philosophy behind those “voodoo” tax cuts. Its simple really. Put more money in the pockets of the rich, and they will invest in business, creating jobs. So why didn’t it work in the wake of Dubya’s tax cuts? And why didn’t Clinton’s tax increases shut down economic growth? [Those are facts, conservatives. Sorry, if you can't handle them.]The reason it didn’t work is simple. It’s horseshit. Investors don’t invest in new businesses, expanding businesses, new equipment, research and development or anything else if there’s no demand. Demand drives the economy, not supply. Why would you invest in greater production capacity if no one is out there with money to spend? Besides, there are plenty of other investments that send no money into increasing production facilities or new businesses. You can invest in commodities, foreign exchange, and government bonds. Even the stock market is mostly an aftermarket, with people buying stock owned by other people. No money goes into business expansion there. And of course, you can “short sell”, that is, bet on the market to decline.If the economic history of the United States proves one thing it is that money in the pockets of little man stimulates the economy. Why do you think there was so much prosperity under Roosevelt, Truman, Kennedy, Johnson and Clinton? Their policies put money in the pockets of the people on the bottom, creating demand and stimulating investment. Wealth doesn’t “trickle down”, it flows up from the bottom.Bogus Conservative Idea #5. The wage earner depends on the wealthy investor for his prosperity. There is nothing more personally entertaining to me than to listen to conservatives talk about “wealth”. They seem to get almost misty eyed about the whole concept. They think that “wealth” is something real — and that the first responsibility of the government is to protect the “wealth” of the “haves”.But what is “wealth”, really? What is the tangible value of that picture of Benjamin Franklin in your pocket? What is “stock”, “equity”, “debt”. Hell, what are property rights? Here’s the answer conservatives. Refute it if you can. “Wealth” is nothing more than a set of abstract ideas that organize distribution of what labor produces. Labor is the thing that is real.Everything used by the person with symbols of wealth is produced by a wage earner. The tools and equipment he uses are produced by a wage earner. The buildings are produced by wage earners. The roads that lead to your house, your office, or your factory are produced by “wage earners”. Wealthy investors who call themselves “producers” make me laugh.That’s why Adam Smith said, “the annual labor of a nation is the fund which supplies the necessaries and conveniences of life that a nation annually consumes.” It is also why Abraham Lincoln said, “Labor is the superior of capital and ought to be given much the greater consideration.” Labor — and not those symbols and social conventions called “wealth” — is the engine of the economy. Leave it to the conservatives to figure out why the man who owns pieces of paper gets whatever he wants, while the man who actually produces has to take what he can get.Bogus Conservative Idea #6. Government is “bad” and has no role in creating wealth or prosperity. Of course, the conservative, who fails to see the all-important role of labor in the creation of “wealth”, likewise fails to perceive the central role of government in its creation. It is certainly true — as conservatives point out — that government doesn’t do the work of production. But government does create the “rights” the property owner relies on the take “ownership” of what somebody else produces. Government creates, enforces and regulates the symbols and concepts of “wealth”. It creates property rights, a court system to enforce those rights, the currency, the banking system, unique forms of business organization called “corporations”, securities, contract rights, and indeed the entire legal infrastructure of capitalism.You don’t hear conservatives complaint about those functions of government. They just claim that those are the only functions of government. Government can do nothing, to hear the conservatives tell it, to benefit the people who do all the actual work of production.And of course, the conservatives completely overlook all of the other infrastructure created by government. They don’t perceive the value of something as simple as a system of roads and highways in creating business opportunities. Every single day, conservatives — like all of the rest of us — make use of technology created by or with the assistance of government. Their computers, TV sets, telephones all make use of microchips first developed by engineers working for government contractors. They make use of communication satellites, placed in orbit by government engineers and technicians. They use materials and technology developed at public universities with government funding.And they are completely oblivious to all of it. They don’t even appreciate all of the commerce and economic stimulation made possible by government assistance and infrastructure for the benefit of wage earners. What sort of economy would we have without the minimum wage and unions creating vast markets for goods produced in capitalist business enterprises. What would our construction industry look like without FHA guaranteed mortgages?But if they’re still not convinced, here is the question they never answer. Show me one “minimalist government” paradise. Just one. We have them. There are places with no social security, no welfare, no unions, no minimum wage, no OSHA, no environmental protection. There are places where the only thing the laws and the government do is protect the interests of the wealthy. They have names like “Guatemala”, “Bolivia” and “Chad”. Every first world economy, without exception, has a substantial public sector. Every one. Show me one that doesn’t conservatives, or the shut the fuck up.Bogus Conservative Idea #7. Conservative believe in “less government”. As you should be able to see, conservatives believe in “less government” for them, more government for you. They believe in less government for the already prosperous. They also believe in more prison, more executions, more power for the police, more spending for the pentagon, more “discretion” for the FBI and CIA. They believe in “harsh” sentencing. They never saw a military intervention they didn’t like.But just let the government tell them to put scrubbers on their smokestacks, or pay their help a living wage. “It’s tyranny, I tell you. ENOUGH’S ENOUGH!”Bogus Conservative Idea #8. Conservatives are “patriotic” whereas liberals are “traitors”. Of all of the conservative posturing, this is the most obnoxious. As we have seen, conservatives utterly fail to appreciate the role of labor in the creation of fortunes. They fail to see the role of government. They fail to acknowledge that the government that creates and enforces their rights, can also create and enforce rights for other people as well.No, the conservative has it all figured out that you, the wage earner, are “on your own”. Ask them what will happen when there are no unions, no minimum wage, no OSHA requirements, no safety net, and in general no government infrastructure that favors anybody but them. What will happen to living standards for American wage earners?Most conservatives I have confronted with this question are pretty straight up. Your living standard will decline. It seems the conservative thinks that you are “overpaid” and “pampered”. So they don’t have any problem with American corporations moving overseas to avoid taxes, environmental regulations, and paying a living wage. They also don’t any problem with free trade agreements like GATT that can only be described as a surrender of American sovereignty. They also support those deficits, funded by bonds, that represent a transfer of wealth from American taxpayers to wealthy bond holders to the tune 300 billion dollars a year.But conservatives don’t believe in a system of government that works to benefit the vast majority of Americans who work for a living. They believe in a system of government that benefits and handful of people who are independently wealthy. So while they pursue policies that benefit the few at the expense of the many, they wrap themselves in the flag, spout selective clauses from the Constitution, put their hands over their hearts and pledge allegiance to “the flag”.They say they love America. But what do they love? The Constitution? Not the one we live under. They love a wooden constitution as it applied to the country before the invention of the telegraph. Do they love the United States Government? Only the agencies of it that kill people. The agencies that do anybody any good are “communist”. And as for the people of this country, well they don’t have very much use for a good three quarters of them — starting with the half of the country who are Democrats. And we know what they think about our “pampered” wage earners?Some patriots, these conservatives. Ship American jobs to third world dictatorships, finance the government with massive debt, saddle future generations with the obligation to pay interest to tomorrow’s millionaires, drive down wages and living standards for ordinary working Americans — and then call the liberals “traitors”.But don’t worry. People are waking up.They are starting to catch on that conservative ideas are bogus.http://www.conceptualguerilla.com/bogusideas.htm

Gee, I wonder if I know the guy? Thank you, Pitbull. That was rich indeed!SWK

That Conceptual Guerilla is one angry dude!

You’re the one with ad-hominem arguments and unacceptable language, SWK.Perhaps you are the one with the weak arguments? You can please stop trying to narrow the set of acceptable statements here.

Here you can buy the cheese imported from France. I only buy cheese made outside North America, for just that reason. The local US (or Canadian?) product is cheaper but may have residues of growth hormones and antibiotics.

fluffy…,i will read it asap , just because yourname is fluffykins the beauty wonder dog.that is one of the best i have ever heard.

Liberal screed and much untruth. Yes deficits are a problem. No, taxes are not too low, but spending is certainly too high. As for the appropriation of property and the implementation of a police state, these things do not happen overnight. You have to admit that getting millions of Americans to walk away from their mortgaged houses is a clever way to set the ball in motion.

2525476 beers on the wall.

Nice Post…

I saw this really great post this morning….

I together with my pals were actually looking at the great hints from your website then all of the sudden came up with a terrible feeling I never expressed respect to the website owner for those tips. Those young men happened to be so excited to learn all of them and now have really been tapping into these things. Thank you for getting quite accommodating and for using this sort of incredibly good themes most people are really wanting to learn about. My very own sincere regret for not saying thanks to you sooner.

Man that was very entertaining and at the same time informative.:’.:`

I will invite all my friends to your blog, you really got a great blog.**”`,

I’m new to your blog and i really appreciate the nice posts and great layout.:~,;”

Hey, what kind of anti-spam plugin do you use for your blog.:;*,:

Oh i really envy the way you post topics, how i wish i could write like that.””;”

Thanks for the great post on your blog, it really gives me an insight on this topic.~.`,”

I always visit new blog everyday and i found your blog.’,”‘*

You can also put a chatbox on your blog for more interactivity among readers.;~,”*

You can also put a chatbox on your blog for more interactivity among readers.,~:;”

Only a few blogger would discuss this topic the way you do.*’,,,

Your blog never ceases to amaze me, it is very well written and organized.`,-”*

RSS Feeds on your blog sometimes does not work.;`;,’

I always visit your blog everyday to read new topics.~.:`’

What would be your next topic next week on your blog.*:~’,

Perhaps you should also a put a forum site on your blog to increase reader interaction.`”:;,

Wow, you seem to be very knowledgable about this kind of topics.:~*”~

Oh i really envy the way you post topics, how i wish i could write like that.::`”‘

A blog like yours should be earning much money from adsense.-”~;:

What would be your next topic next week on your blog..*-~*

You can also put a chatbox on your blog for more interactivity among readers…`:,

I love reading your blog because it has very interesting topics.:;*;”

Top post. I count on reading much more. Cheers

Your blog never ceases to amaze me, it is very well written and organized.“’:*

However, most partners arent willing to pay for.

You are so cool man, the post on your blogs are super great.,.,”~

You can increase your blog visitors by having a fan page on facebook.-”-`;

I would really love to guest post on your blog.-.’:-

It indeed does take quite some time to find fantastic information such as this. Thank you very much.

I just put the link of your blog on my Facebook Wall. very nice blog indeed..*`’*