Faber is the man!!

I do agree with the professor – there is little chance that the consumer (remember them? 70% of the US economy) will rebound anytime soon. The savings rate is still very small, credit is much tighter than it was (and getting more expensive for consumers with credit card rates climbing), and their assets are worth less on the whole than they were 2 years ago.I don’t think the consumer bounces back in any near future. At least not in a way that pulls the economy out of its hole.Think slow, barely visible recovery if any at all.

So Faber is saying that even though the system is not healthy, per se, the more money that is printed, the higher the stock market could go.

Because the average American is naive, deluded, and confused by right and left political babble. If you ever have a conversation with most average Americans it’s pretty astonishing how stupid the population is at large. For example somehow health care is taking center stage when the bankers should be burning at the stake.

Isn’t that the point Michelle made over and over?

Make that 3 Trillion in loses and climbing… The Banks are INSOLVENT period!CHART OF THE DAY: Home Prices Collapsing Even FasterJoe Weisenthal and Kamelia Angelova|Aug. 12, 2009, 4:36 PM|5PrintTags: Economy, Chart Of The DayThe Case-Shiller has been signalling an improvement in the second derivative of housing prices for a few months, and in the latest report it even showed a sequential increase. But check out the NAR’s numbers for all of Q2. The year-over-year drop in the median sales price of single family homes showed its worst decline ever. They didn’t even have a second derivative gain improvement.http://www.businessinsider.com/chart-of-the-day-sales-price-of-existing-homes-2009-8

All I can say is that in my neighborhood, which is in a very stable area, the downward trend in prices over the last few months has been shocking. Previously, the decline seemed to be nowhere near what was being seen in other area. My area has a lot of big pharma, which is consolidating and cutting a large number of jobs. These are really good jobs that are being cut. What are they supposed to be replaced with?

I think what the banks are doing is too force deflation by restricting credit and causing businesses to suffer trauma. Then, these failing businesses can be bought for nickles and dimes on the dollar – with tax payer money of course.

This is a valid and ominous theory. Basically, we, the people of the United States, gave trillions to the banks to “bail them out.” The took our money and are using it to drive us out of our homes and jobs, deflate the value of small, medium, and large businesses and in the end buy everything of value by fire sale prices using our trillions. There is a certain beauty in this combination, isn’t it? Is my logic correct or I should be ashamed of myself and try to be “more optimistic?”

Saw this link tonight on http://www.survivalblog.com. Anyone more knowledgeable than I care to comment? Is the author a respected authority?http://rockcreekfreepress.tumblr.com/post/153948922/the-second-wave-of-the-depression-hyperinflation

When “the borrower is servant to the lender,” and the borrower increases borrowing, the inevitable result is that the lender ends up owning everything. Nothing new under the sun on this front.So why is the American consumer so dumbed-down? Simple. We’re no longer in touch with the source of this universe’s wisdom. And what is that source? I’ll let you bloggers tell me.Hint: Where does the quote “The borrower is servant to the lender” originate? Guesses any guest?Chignos

Watch the video… Who you going to beleive, people like this or Giethner, Bernanke, Obama, et al….The Banks are INSOLVENT!Elizabeth Warren “We Have A Real Problem Coming”Submitted by Tyler Durden on 08/12/2009 17:13 -0500Bailout Banks Congressional Oversight Panel Elizabeth Warren MSNBC REALElizabeth Warren, head of the Congressional Oversight Panel, which yesterday released quite a sobering report on the true state of the banking industry, explains what is really going on with the increasingly irrelevant balance sheets of the bailout banks (all of them). Once again underscores what a farce the stress test was, the complicity of the accountants in making the transparency initiative a sham, and why the banks are still as underwater as they ever were. Compliments of Shanky’s Tech Blog.http://www.zerohedge.com/article/elizabeth-warren-we-have-real-problem-coming

I reread Webster Tarpley’s article and found it very interesting, especially his historical analysis of the Depression. He’s a bit too utopian–his prescriptions imply everything will be ok if…………we just do as he suggests.No one knows the future that well. Also, Tarpley’s societal medicine is a little suspect since the prescription has absolutely no chance of being filled.Still, there may be elements of his thinking that have a good chance of being adopted, especially a tax on derivatives.

All my pension fund money has been on a money market account at TIAA-CREF with YTD interest of 0.11%. In the same period two of my credit card companies notified me about raising their rates by 2-3% and my medical insurance has risen 12%. How many suckers in similar situation will resist the temptation to change from MM to the stocks?

Force Their Hand!The U.S. govt has clearly decided to preserve the existing elitist financial powers at all costs. Their answer to the cries for greater transparency, regulation and accountability is to shake their head yes while enabling the same old practices to continue. If every citizen would simply remove their assets and do no business with these banks and the businesses which do business with them, it would force the govt’s hand and open the door to real progress’ otherwise prepare yourself for a repeat of even larger crises in the future.

It will end when the Fed takes away the punchbowl, until then, and who knows how long that will be, take advantage of this opportunity while keeping your eyes and ears open for liquidity tightening.My apologies for sounding like a broken record.

Niall Ferguson;”Mega-deficits as far as the eye can see are bad politics. They could be even worse economics. The nightmare scenario is that mounting fears over US creditworthiness push up long-term interest rates, thereby choking off the nascent recovery. After all, the great deleveraging still has a very long way to go. In relation to GDP, household net worth has slumped back to where it was 20 years ago. But household debt is still close to record highs at about 130 per cent of disposable income. Anyone expecting private consumption to bounce back is dreaming; real personal spending actually fell in June. Moreover, the property crisis is far from over. The number of prime borrowers behind on mortgage payments rose 13.8 per cent between March and June. The business default rate is already above 11 per cent and is heading towards 13 per cent. The contribution of the stimulus to growth (monthly spending as a proportion of GDP) has now passed its peak and by January 2010 will be zero. The public-private partnership to buy toxic bank assets has flopped. The official jobless rate conceals a surge in long-term unemployment to a postwar record.Remember: this remains a global crisis. Any big external shock (for example, a European banking crisis) could abort economic stabilisation just as surely as the 1931 failure of Creditanstalt gave the world two more years of depression.”http://www.ft.com/cms/s/0/c24385ce-85ef-11de-98de-00144feabdc0.html?nclick_check=1

What does debt deflation mean, GSM? Debt does not deflate. Assets inflate or deflate, depending on your use of the terms inflation & deflation. We have been calling asset inflation growth. What you refer to as debt deflation I prefer to see as contraction. And of course you can print all the money you want in that environment and not see it as >CPI. Similarly, you can print all you want and not see >CPI when supply increases faster than demand. That has been the environment for the last 20 years. Inflation, as measured by CPI, is hidden in those environments. The better measure is money supply. I know there are arguments with that too. But when money grows faster than economy that is inflation. See the link to Stephen Becker above.An argument can be made that during times of contraction proper monetary policy should be expansive (Keynes). But our problem is that we want expansive monetary policy all the time. The Fed is claiming just yesterday that they will start to withdraw liquidity by Oct. Not likely. The political reprecussions of doing so will be terrible. And the Fed a political appointees.The real worry is when money moves away from depreciating dollars.

This is exactly the same scenario that played out in the dot.com bubble.Fact, Fiction, Farce and Lies! What happened to the Bank Bears? (by Reggie Middleton, published Thursday, 13 August 2009 00:00)… Accounting boards, banks, media and sell side analysts in general appear content to ignore the facts, change the way we count losses (after all, losses are,,, well,,, losses. Right???!!!), and generally sweep the banking problems under the rug in anticipation of bubbling our way out of the problem or at least concealing it long enough through accounting shenanigans to allow accounting profits to somehow paper over economic losses. Good luck with that. Underlying fundamentals are still deteriorating, albeit potentially at a slower pace, as share prices are literally flying through the roof. Those who are in the market and are bullish or not market neutral are, in my opinion, playing with fire. It is gambling to buy stock just because the stocks prices are going up. I know it feels good when the prices go higher after you buy the stock, but the underlying fundamentals are atrocious and if one were to get caught in a nasty correction, one could not have said it was “impossible to see coming”. This is exactly the same scenario that played out in the dot.com bubble. Bulls were justified because share prices went higher, not because underlying values increased. When reality hit (and it always does hit, that’s whey they call it reality) folks were literally wiped out.

excellent point. at my kids school they have a class in Media Manipulation. How television advertising gets you to feel bad about yourself and how their product will fill that need.They are taught that these networks are owned by the same people that manufacture weaponry.(GE, Westinhouse) They want you to feel powerless and not to think too deeply. Like don’t think we could have saved Trillions over the last 25 years if we invested in mass transit rather than Mass Destruction.

Dear Professor:I just saw the CNBC piece with you and Taleb on the Huffington Post. You are obviously a rational business executive/economist that needs to balance your views and hedge future events in your analysis. I understand this. However, we are in a serious situation where leadership is key. Somebody has to point out that the banksters are holding the global economy hostage. Serious change has to take place or the banksters will continue to take advantage of the crisis and milk it for MEGAPROFITS. You know they are sucking these “stimulus measures” dry. You knowthat nothing has been fixed and all we have is trillions of opportunities for the banksters to further mamimize profits. You know that Bernanke and company will continue to rob us blind. This was not an accident. William Black is even more to the point than Taleb. This was engineered, because crises yield tremendous profit opportunities. I have readyour prescriptions from the beggining and you know that everything is being done wrong and that the global aggregate demand can only decrease. You arebusiness wise in hedging, but you have a responsibility to give us the true prescriptions to fix the global economy. The banksters must be removed from power not empowered further to hypermaximize their profits at the population’s expense. We now need to change the system to steer the banks away from the “speculation casino” to harnessing the productive capitalism potential of this country. Nassim Taleb and William Black are both right that we must have radical solutions. These are revolutionary times and we need personal sacrifice to save the global economy. Show us your precise prescriptions for a sustainable and self sustaining global economy. Summers and Geithner are following the Central Bank prescription of preserving the Old Order at the expense of the people. You are a supreme intellectual, but you must find some warrior in you to help the effort. Professor! “Use the force”! Look within and chosethe middle path, there is only material gain in the path of the Old Order. There is spiritual glory in your original path. I know that sometimes you feel that you are throwing pearls at the swine, but have faith.

The Federal Reserve is ImmoralWednesday, August 12, 2009During the first few days of each month comes a task that is increasingly approached with dread around here and, unfortunately, that condition is likely to persist for some time.Shortly after banks make their month-end update to various short-term savings accounts that we hold, these balances are queried, only to find that, almost without exception, interest credited is less than it was in prior months and far less than it was eight or ten months ago.Why?Largely as a result of the Federal Reserve keeping short-term interest rates pegged to zero.You see, aside from some Certificates of Deposit that were locked up late last year which, today, provide the strangest of feelings during a very strange period in history (i.e., feeling lucky to get about 2.5 percent interest for a one-year CD), it’s nearly impossible to get more than a two percent return these days on any kind of an FDIC-insured account and, more likely than not, you’ll get less than one percent.Speaking as one who knows from experience, there’s a big difference between one or two percent and five or six percent, what used to be the “minimum” rate of return for a super-safe savings account backed by the government.More importantly, if this is causing us angst every month, I can only imagine what it’s doing to the budgets of other savers whose finances are far less comfortable than ours.Put simply, the freakishly low short-term interest rates that the Federal Reserve is jamming down everyone’s throat are immoral and, maybe, just maybe, a lot more people are beginning to see this, along with other practices of our central bank that are just not right.Maybe, just maybe, something will finally be done about reforming (or, as suggested by Rep. Ron Paul, abolishing) this banking cartel – hopefully before the Fed celebrates its 100-year anniversary in a few years.Just to be clear on the terminology here, Merriam-Webster offers the following:immoraladjectivenot moral; broadly : conflicting with generally or traditionally held moral principlesmoraladjective1a: of or relating to principles of right and wrong in behaviorSetting aside questions about the dark veil of secrecy surrounding who and how much the central bank has been helping with their problem loans, problem assets, and problems staying solvent, there are at least three ways that the organization David Wessel calls “the fourth branch of government” is acting badly these days – by punishing savers, by enriching the banks, and by fleecing the poor.Of course, none of this is really new – it all just seems a whole lot more relevant today than ever before given the current state of affairs in this country and around the world.Punish the SaversAs noted above, it used to be that you could always count on getting five or six percent interest in a “no-risk” savings account backed by the FDIC. In fact, going all the way back to 1955 (when the interest rate data at the Fed’s website stops), the average short-term lending rate is right between those two marks – 5.66 percent.Ever since I was a teenager, I can remember thinking, “If I could somehow amass a million dollars, that would surely generate enough money to live on for the rest of my life”.Well, welcome to the 21st century, where the asset bubbles keep a-poppin’ and the interest rates keep a-droppin’.Over most of the last hundred years, aside from the dollar losing more than 90 percent of its purchasing power (versus a loss of zero during the prior ten decades), there hasn’t been too much to complain about in the Fed’s management of money and interest rates but, since asset bubbles and the attendant “mopping up” process have become a way of life, the rate of return on savings has been abysmal.With the exception of the “baby-steps” rate raising campaign a few years ago, the Fed funds rate has been below two percent since 2002 – after the decade’s first asset bubble met its pin.Now, if there was a good reason for keeping rates so low, this might all make some sense to senior citizens who have looked disappointingly at their bank statements for years, but given the fact that the low-rates in 2002-2004 led to the housing and credit bubbles forming and then bursting a few years later, and here we are with even lower rates today, all of this should make anyone with half a brain realize that there is something seriously wrong with the system as it currently operates.In a nation in dire need of internal savings, the fact that savers are being punished as never before is just plain wrong – immoral – and the idea that we live in an era of “low inflation” is just salt rubbed in the wounds of senior citizens who, year after year, watch prices for health care and energy rise by some multiple of the one or two percent they can earn on their savings.Twenty years from now (perhaps sooner), they’ll look back on today’s monetary policy and say to themselves, “What were they thinking, punishing the savers like that when the U.S. desperately needed savings?”Enrich the BanksAs if it weren’t bad enough that savers are cheated every time the Federal Reserve lowers interest rates, the worst part is that banks are the beneficiaries.You see, in addition to buying up many of the bad assets previously held on bank’s books over the last year or so – the result of waves of imprudent bank lending – when the Fed lowers interest rates it helps to make the business of banking much more profitable and, conventional wisdom has it that our financed-based economy will then begin to recover.And when the banks can borrow at these super-low rates, that means that savers can’t earn much more in interest.Banks come first and savers are far down on the list.Why does the system work this way?Well, most people haven’t got a clue what the Federal Reserve is or what it does (though, understandably, there is growing interest in this topic, ever since the wheels fell off of the global economy last fall), but the crucial bit of information that the now-slightly-more-curious public should learn quickly is that the central bank was not set up to help the people or the government, but, rather, to help the big banks.In fact, according to G. Edward Griffin, who happened to write a whole book on the subject, the very reason that the Federal Reserve was formed back in 1913 was so that big banks could wrest back control of the banking system from the many small, fledgling, independent banks all around the country that were taking away their business.Look around you today. You might see lots of little banks failing, but only a few large ones ever go under and none of the country’s biggest banks ever fail.The Fed was created by the big banks, for the big banks, and its unwritten “mission statement” is to do whatever it takes to ensure the survival and profitability of those big banks, getting the government to step in with public money when necessary for “the greater good”, effectively socializing the losses while keeping the gains in private hands.That’s why what we have today – a wholly unsustainable system of ever-expanding credit and debt dominated by a handful of “too big to fail” banks – keeps getting propped up.The masses are led to believe that credit is the “lifeblood of the economy” when, in fact, credit is the lifeblood of a banking system that has, over time, sucked the life out of the economy.It’s hard to imagine anything that is more immoral than the Federal Reserve’s role in this process, now almost a hundred years in the making.Fleece the PoorIn arriving at the third and final way that the Federal Reserve is immoral, clearly, that last thought in the previous section was premature.In fact, there is one very good example of something being done today by the central bank that is even more immoral than a nearly century long wealth transfer from the public sector to the private banking system – the ongoing assistance being provided by the Fed in helping the banking system reach out and find new customers so that every possible dollar can be extracted from them.You see, the country’s big banks (along with the central bank that serves their interests) would much prefer that poor people all across the country not go to a place like you see to the right and, for a small fee, convert their paycheck into cash and forever live within their means.Bankers would much rather see the nation’s poor open up checking accounts and then venture further into the world of modern day banking, quickly learning to spend well beyond their means.Left unsaid in the Fed’s many efforts to reach out to the “unbanked” is that checking accounts are a sort of “gateway drug” for many people – a road to debt serfdom where, in addition to paying interest on money borrowed to buy stuff that they don’t need, these “newly banked” poor will also be fleeced by a bewildering array of fees and charges in a system that is set up to systematically suck as much money out of as many people as possible.Over the years, the Federal Reserve has made great efforts to attract new customers for banks, in some cases providing cartoon characters to make the whole idea of debt serfdom seem like a friendly sort of condition, much in the same way that Joe Camel once attracted new smokers.Under the guise of “education” and with “consumer protection” as its goal, the Federal Reserve might seem to be “looking out for the little guy”, but they’re not. They’ve had the power to do this for many years now but, for obvious reasons, have exercised their “power to protect” the consumer only sparingly, allowing millions of subprime borrowers to give the housing bubble one last giant hurrah before it finally burst.Fortunately, it appears that the Obama administration would like to see the American consumers’ interests watched over by some other group and for good reason. A report earlier in the week in the Financial Times detailed how big banks in the U.S. plan to extract almost $40 billion in overdraft fees from American consumers whose balance sheets haven’t been bolstered by government bailouts.It seems that, with the collapse of the mortgage finance bubble, big banks are now reverting to a profit model that is driven more by extracting fees from their customers wherever possible and overdraft fees from the cash-strapped are “the mother lode”.A full 90 percent of overdraft fees come from just 10 percent of all checking accounts and most of this 10 percent have low credit scores and/or are recent entrants to the world of mainstream banking.Not surprisingly, the highest overdraft fees come from the biggest banks – Citigroup, Bank of America, JP Morgan Chase, Wells Fargo, SunTrust, and Citizens Bank.For banks, overdraft fees are a low risk, high profit part of their business, not something that is usually mentioned as part of the Fed’s outreach programs. It is a sophisticated, large scale sort of “payday loan” system that many Americans fall prey to and, as long as customers have their payroll checks automatically deposited, the bank will always have first crack at the money and people will continue to spend more than they make because, when you get down to the very basics here, most people aren’t very good at math.But, banks are.Maybe Ron Paul is right – the Fed should be abolished.Then markets could set interest rates, banks would have to fend for themselves, and there would be one less group helping to extract what little money the poor have left.http://themessthatgreenspanmade.blogspot.com/2009/08/federal-reserve-is-immoral.htm

“So why is the American consumer so dumbed-down?”TELEVISION. owned and operated by those in ‘control’.

47 economists in a Wall Street Journal survey, and 53 in a Bloomberg one, say the recovery is here and the recession is over. That would add up to a nice even 100, but I’m afraid many might be the same. When reading through the two articles about the surveys, I find it -literally- hard to see what the optimism is based on. There is talk of confidence indices, the Obama stimulus gets mentioned, as does a Fed $1.45 trillion mortgage debt purchase. The consensus expectation is for unemployment to stay below 10%, but there’s no reason(ing) provided for that.The closest thing to a concrete fact I can find in either piece is the “better-than-expected employment report for July, where employers cut 247,000 jobs and the jobless rate fell for the first time in 15 months”. And yes, that does sound nice, but those numbers cover just one month, and so many if’s, but’s and maybe’s have been pointed out since they were published that they can only be a very slim foundation to base so much optimism on.So I have to say, I don’t know why the 47+53 club expects economic growth, recovery, any of that. There may well be better formulated grounds, but in the absence of such grounds, I feel left quite cold and alone with faith-based “economics”. Of course, what I’ve left out thus far is what may well be the main reason for the hosanna feeling: the surge in stock markets. Still, I’m sure at least some of the economists would recognize that rising share prices are, all on their own, a questionable indicator for an economy that’s been mired in recession/depression for, depending on your calendar, 10 or 20 months.Now, I vividly remember many separate occasions on which many separate economists have alluded to two distinct sectors of the economy as the most important, make or break, ones. Those two are housing and employment, obviously. So if both those surveyed and the reporters writing about the survey fail to come up with concrete examples, I’d humbly suggest looking there.Sure, officially “only” 247,000 people lost their jobs in one month, and the continuing jobless rate fell a bit. But first of all, anyone who can read by now understands that these BLS slash goverment numbers are not the undisputed final word on the topic. And moreover, let’s see: one third of all America’s jobless are long term unemployed, as in longer than 26 weeks. That’s 4.4 million people. By December, 1.5 million will be out of a job for longer than any extended benefit timeframe will cover, i.e. on average a year or more. The number who fall off the back end of these stats make the data that claim the continuing jobless rate went down look suspicious.It’s not going to stop with those 1.5 million more or less perpetually hopeless. In fact they’re merely the vanguard of an abundant legion that is being raised in the nation of people who are not just jobless, but simply and outright hopeless. What happens to the official U3 unemployment rate remains to be seen, but, again, one month does not a summer make, even if the numbers would be taken at face value. It would be much more useful for every reporting party to switch to the U6 data, since they encompass such large groups of people that we would all intuitively see as unemployed, but I digress for now.Still, the unemployment stats hardly seem to point straight at recovery and growth. Everyone agrees the numbers will keep going up, the only real discussion is by how much.The second pivotal indicator, besides jobs, is housing. For that, we can turn to today’s news. Home sales in the 2nd quarter rose 3.8% from the first. That looks like good news, but not so fast. Home prices, for existing homes, fell by a record 15.6% over last year, the most in 30 years of record keeping. Yet another record was set by the number of foreclosure filings. 360,000 homes received such a filing in July, in one single month! And that’s with state and federal anti-foreclosure programs in place.So, excuse me, but no, I don’t see a reason for optimism in housing either. I think the 47+53 economists have just proven once more that their field is very far away from being a science, that they are selling religious messages. And of course you can say: hey, it works for Christianity, so why not give it a go. But not even priests pretend to be scientists.Luckily for all of us there are still analysts around, albeit not that many, who don’t feel satisfied with just stories and belief systems.Harry Markopolos predicts a major implosion in the CDS market. We don’t know what he bases that on, and we don’t want to slip into faith as well, but such an event is on the way, be it sooner or later. Nassim Taleb sums it up like this (as assembled by Clusterstock):We’re all in denialWe’re replacing private debt with public debt.We’re not dealing with the cancer in our banking system.We’re not making the structural changes we need to make.We’re not being aggressive enough about restructuring debt (debt for equity swaps).Bernanke is a wimpy Greenspan sycophantObama’s rewarding the fools who got us here (Summers, Bernanke, Geithner)The banksters are taking over againWhile Elizabeth Warren (surprisingly dark for a government employee) adds these pointers:The banks are still insolvent.That little tweak to mark-to-market accounting a couple of months ago has allowed us all to plunge into deep denial.Now that the banks are allowed to lie about what their toxic assets are worth, they’ll never sell them (because if they did they would have to write them down).The smaller banks are undercapitalized and will have to raise another $12-$14 billion.And Robert Prechter finishes off the position of the not-so-rosy:Yes, the late 2007-early 2009 market debacle was just a warm-up to what Prechter believes will be the bear market’s main attraction. In this regard, he says the current cycle will echo past post-bubble periods such as America in the 1930s and England in the 1720s, after the bursting of the South Sea bubble.The 2000 market peak market a “major trend change” for the market from a very long-term cycle perspective, and the downside is going to continue to be painful well into the next decade, Prechter says. “The extreme overvaluation, the manic buying and bubbles in the late 1990s [and] mid-2000s are for the history books – they’re very large,” he says. “The bear market is going to have to balance that out with some sort of significant retrenchment.”How significant does Prechter think that retrenchment will be?”This is the kind of top, the kind of degree, that we haven’t seen for a couple of hundred years.”Yup. We’re in for nasty weather. The markets are up 45%, while all serious indicators in the economy have worsened substantially, since their lows 5 months ago. Now, if you were a practical person, if you wanted proof instead of stories that “the worst may be over”, where would you think those markets are likely to be headed?It’s still all about the toxic debt, nation. That is where the answers lie. Useless mortgage backed securities mixed with lost wagers on everything under the sun. Markopolos may or may not have the correct call on CDS revelations. But what’s certain is that if home prices drop at record levels, so do the securities written on them. That means the toxic debt continues to become even more toxic, not less.But, yes, I know, faith is a tempting proposition for the fickle human mind.One more thing: I said when the crash started that you don’t need the banks that were then starting to be bailed-out, that what you need is access to your money, plain and simple, which the government could guarantee through post office or supermarket. Today, Elizabeth Warren says this:”The question of whether or not you think the world as we know it has ended, depends on what you think the world IS as we know it. If you think the world as we know it are a handful of huge financial institutions, the dinosaurs that roam the earth, then you’re right; they’re not going to exist without HUGE infusions of government money.On the other hand, if what you really believe is our economy and our world is [..] 115 million American households that are out there, that need jobs, you start to see it very differently, you think: the dinosaurs are gone, and [there’s still a lot of stuff to be done.]“http://theautomaticearth.blogspot.com/

Help me understand this: We (the current and future US Taxpayers)just backstopped asset valuations to avoid a deflationary depression. However, doesn’t 1% of the population own/control somewhere between 70%-90% of those assets? So, we have just underwritten assets for the wealthiest 1% on the backs of the 99%, incurring interest-bearing debt to ourselves as compensation. Sounds like we got shafted. That is a preservation of wealth for the 1%, not a redistribution of wealth to the 99%! Where are the Obama debates about that? The taxation we will need to endure in servicing only the interest on the massive stimulus (also known as interest bearing debt)will be perpetual. Don’t forget the gang-bankers foreclosing and charging late fees and overdraft fees on credit cards too. Did you know that after they trash your credit score, it will be next to impossible to get a job. Perpetual debt…perpetual unemployment…there’s got to be a better way!

you got it! Hardworking American’s dollars have gone to save the top 0.1%. This creates several monumental changes for the mega corps: many of their competitors are now gone and desperate Americans will have no choice but to work for less money; all resulting in huge profits and greater power for the elite. Until the majority of people wake up and smell the “poisoned coffee”, we are all in big trouble!

http://news.yahoo.com/s/ap/20090813/ap_on_go_ca_st_pe/us_clunkers_not_so_greenDemocrats are environmental friendly? Forget it, Obama, Pelosi, Geithner, and Democratic Congress all dirty scumbag and liars. YES WE CAN SCREW ENVIRONMENT AND PLAY INNOCENT.

Banks are buying shares of stock? Is that what you are saying?

It’s quite astounding, once you get outside of the protected big banks, how ugly the rest of the banking sector is looking.Elizabeth Warren is totally right to be sounding the alarm — plenty of small banks, by virtue of collapsing loan value — are in serious trouble, and need either bailouts or FDIC-backed winddowns. Of course, the FDIC is going broke, and it may be understaffed, just based on the sheer volume of banks that are shutting down.Karl Denninger points to this Bloomberg Piece about Regions Financial (RF):Check out the footnotes to Regions Financial Corp.’s latest quarterly report, and you’ll see a remarkable disclosure. There, in an easy-to-read chart, the company divulged that the loans on its books as of June 30 were worth $22.8 billion less than what its balance sheet said. The Birmingham, Alabama-based bank’s shareholder equity, by comparison, was just $18.7 billion.So, if it weren’t for the inflated loan values, Regions’ equity would be less than zero. Meanwhile, the government continues to classify Regions as “well capitalized.”While disclosures of this sort aren’t new, their frequency is.That’s not a tiny, little bank. And it’s not the only one having problems. Others like Colonial (CNB) and Guaranty (in Texas) are all in the same direction. Again, not small banks.

carrot or big stickMake the cost of wage increases deductible from corporate income tax and make the savings from layoffs taxable as corporate income.http://www.atimes.com/atimes/Global_Economy/KE27Dj07.html

“FREE TIBET”-You have it right .”BUT OUR PROBLEM IS WE WANT EXPANSIVE MONEY POLICY ALL THE TIME”Yes that is correct.That is the basis of the Politicians looking at the Fed Reserve to “Lower Interest Rates for the next year “, SO WE CAN GET RE-ELECTED,because of the temporary artifical prosperity, from the increase in money supply..It truly is a two edged sword ,the so called INDEPENDENT Fed Reserve and the trade off,s by the Politicians with the Fed Reserve Board.Everyone involved knows the game and how it is played.The Public simply dont count when it involves the manipulation of the money supply..We just get to argue amongst ourselves as to what we all should or should not earn.Meanwhile the 20% Cream is taken off the top.

you are crazy. stock market is not ponzi. you call IBM or Oracle ponzi, you crazy. what is ponzi is $USD, short/long gov/state/local debt, municipal, agency paper are ponzi. those all can be originate out of thin air.

I need some more help…I would like to find out how much (total)interest we pay as a people (nation)annually. What is the total public and private interest expense to all creditors? (Consumer, Corporate, Local, State, Federal Government) Anyone?

When was the last time 300 million americans bought something from IBM or Oracle? they sell only to thier other corporate friends who think they need all the stuff they make… last thing maericans bought form ibm were thier laptops which they solf 3-4 years ago to Lenovo… look inside the homes (soon to be 50% of which are underwater) of all americans and see how much IBM and oracle products they have in them…

Economic SceneThe Looting of America’s CoffersBy DAVID LEONHARDTPublished: March 10, 2009Sixteen years ago, two economists published a research paper with a delightfully simple title: “Looting.”Skip to next paragraphExplaining the Science of Everyday LifeGo to Economix » Readers’ CommentsReaders shared their thoughts on this article.Read All Comments (58) »The economists were George Akerlof, who would later win a Nobel Prize, and Paul Romer, the renowned expert on economic growth. In the paper, they argued that several financial crises in the 1980s, like the Texas real estate bust, had been the result of private investors taking advantage of the government. The investors had borrowed huge amounts of money, made big profits when times were good and then left the government holding the bag for their eventual (and predictable) losses.In a word, the investors looted. Someone trying to make an honest profit, Professors Akerlof and Romer said, would have operated in a completely different manner. The investors displayed a “total disregard for even the most basic principles of lending,” failing to verify standard information about their borrowers or, in some cases, even to ask for that information.The investors “acted as if future losses were somebody else’s problem,” the economists wrote. “They were right.”On Tuesday morning in Washington, Ben Bernanke, the Federal Reserve chairman, gave a speech that read like a sad coda to the “Looting” paper. Because the government is unwilling to let big, interconnected financial firms fail — and because people at those firms knew it — they engaged in what Mr. Bernanke called “excessive risk-taking.” To prevent such problems in the future, he called for tougher regulation.Now, it would have been nice if the Fed had shown some of this regulatory zeal before the worst financial crisis since the Great Depression. But that day has passed. So people are rightly starting to think about building a new, less vulnerable financial system.And “Looting” provides a really useful framework. The paper’s message is that the promise of government bailouts isn’t merely one aspect of the problem. It is the core problem.Promised bailouts mean that anyone lending money to Wall Street — ranging from small-time savers like you and me to the Chinese government — doesn’t have to worry about losing that money. The United States Treasury (which, in the end, is also you and me) will cover the losses. In fact, it has to cover the losses, to prevent a cascade of worldwide losses and panic that would make today’s crisis look tame.But the knowledge among lenders that their money will ultimately be returned, no matter what, clearly brings a terrible downside. It keeps the lenders from asking tough questions about how their money is being used. Looters — savings and loans and Texas developers in the 1980s; the American International Group, Citigroup, Fannie Mae and the rest in this decade — can then act as if their future losses are indeed somebody else’s problem.Do you remember the mea culpa that Alan Greenspan, Mr. Bernanke’s predecessor, delivered on Capitol Hill last fall? He said that he was “in a state of shocked disbelief” that “the self-interest” of Wall Street bankers hadn’t prevented this mess.He shouldn’t have been. The looting theory explains why his laissez-faire theory didn’t hold up. The bankers were acting in their self-interest, after all.•The term that’s used to describe this general problem, of course, is moral hazard. When people are protected from the consequences of risky behavior, they behave in a pretty risky fashion. Bankers can make long-shot investments, knowing that they will keep the profits if they succeed, while the taxpayers will cover the losses.This form of moral hazard — when profits are privatized and losses are socialized — certainly played a role in creating the current mess. But when I spoke with Mr. Romer on Tuesday, he was careful to make a distinction between classic moral hazard and looting. It’s an important distinction.With moral hazard, bankers are making real wagers. If those wagers pay off, the government has no role in the transaction. With looting, the government’s involvement is crucial to the whole enterprise.Think about the so-called liars’ loans from recent years: like those Texas real estate loans from the 1980s, they never had a chance of paying off. Sure, they would deliver big profits for a while, so long as the bubble kept inflating. But when they inevitably imploded, the losses would overwhelm the gains. As Gretchen Morgenson has reported, Merrill Lynch’s losses from the last two years wiped out its profits from the previous decade.What happened? Banks borrowed money from lenders around the world. The bankers then kept a big chunk of that money for themselves, calling it “management fees” or “performance bonuses.” Once the investments were exposed as hopeless, the lenders — ordinary savers, foreign countries, other banks, you name it — were repaid with government bailouts.In effect, the bankers had siphoned off this bailout money in advance, years before the government had spent it.I understand this chain of events sounds a bit like a conspiracy. And in some cases, it surely was. Some A.I.G. employees, to take one example, had to have understood what their credit derivative division in London was doing. But more innocent optimism probably played a role, too. The human mind has a tremendous ability to rationalize, and the possibility of making millions of dollars invites some hard-core rationalization.Either way, the bottom line is the same: given an incentive to loot, Wall Street did so. “If you think of the financial system as a whole,” Mr. Romer said, “it actually has an incentive to trigger the rare occasions in which tens or hundreds of billions of dollars come flowing out of the Treasury.”Unfortunately, we can’t very well stop the flow of that money now. The bankers have already walked away with their profits (though many more of them deserve a subpoena to a Congressional hearing room). Allowing A.I.G. to collapse, out of spite, could cause a financial shock bigger than the one that followed the collapse of Lehman Brothers. Modern economies can’t function without credit, which means the financial system needs to be bailed out.But the future also requires the kind of overhaul that Mr. Bernanke has begun to sketch out. Firms will have to be monitored much more seriously than they were during the Greenspan era. They can’t be allowed to shop around for the regulatory agency that least understands what they’re doing. The biggest Wall Street paydays should be held in escrow until it’s clear they weren’t based on fictional profits.Above all, as Mr. Romer says, the federal government needs the power and the will to take over a firm as soon as its potential losses exceed its assets. Anything short of that is an invitation to loot.Mr. Bernanke actually took a step in this direction on Tuesday. He said the government “needs improved tools to allow the orderly resolution of a systemically important nonbank financial firm.” In layman’s terms, he was asking for a clearer legal path to nationalization.At a time like this, when trust in financial markets is so scant, it may be hard to imagine that looting will ever be a problem again. But it will be. If we don’t get rid of the incentive to loot, the only question is what form the next round of looting will take.Mr. Akerlof and Mr. Romer finished writing their paper in the early 1990s, when the economy was still suffering a hangover from the excesses of the 1980s. But Mr. Akerlof told Mr. Romer — a skeptical Mr. Romer, as he acknowledged with a laugh on Tuesday — that the next candidate for looting already seemed to be taking shape.It was an obscure little market called credit derivatives.E-mail: Leonhardt@nytimes.com

I bought a Chinese Acer laptop at Walmart about 1 1/2 yrs ago:It didn’t last a month before it started crashing, requiring multiple warranty work, problem is, Acer’s warranty work means dropping it off at Circuit City….they went bankrupt.I even wrote the VP of Acer on this anomaly and the Washington State Attorney General….they teamed together and told me to go to Hades…LOL…of course Walmart’s management told me the same thing.Don’t buy an Acer laptop is my advice….but are any of the Chinese electronics’ warranties any good?

Well said Pecos.Do you remember when all Scientists were shown in the media/film/T V as a “White Coat”,never to be trusted or valued in our society.Great pains were taken after the Second World War to paint all “Refugees” of the Educated Class as somehow inferior to the locals.We have not done ourselves any service by deliberately downplaying Knowledge as a value.Except of coarse,those few children of the upper middle class, who have no choice but tostay on a path of Knowledge.

Well National Debt and State Debt are the easy ones.E.G. At the end of the last Budget Period -FederalNational Debt $10 Trillion times average rate of interest (3.5%) EQUALS = $350 Billion in Interest Expense.I assume everyone knows the National Debt is just a revolving line of credit and NO Principal Payments are included in the Federal Budget.Hows that for starters.Every time a Bond issue comes up for Redemption staff simply issue a new issue to raise the cash to pay off the old one.Hence the comment- The National Debt is just a revolving line of credit.(Initially intended for the purchase of physical Infrastructure the Feds are responsible for.)The real question for Govt.is:Is the DEBT to GDP Ratio being kept under 50%YES or NO ??? This applies to both State and Federal.Anything else you technically slip to Second World Country Status.100% -Third World /Junk Bonds.No Mystery .All Grade Six Math,notwithstanding all thoses Zero,s…..

http://www.hightowerlowdown.org/node/1959.From the frontlines of the global financial meltdown:Q: What made Wall Street implode? A: They were making too much money to stop.Did you have a piggy bank when you were a child? Mine was a cheery, round pig–made of brown pottery, as I recall. For parents of that time, having their children feed pennies, nickels, and the occasional dime into these toy banks was a sweet lesson in frugality–a Kodak moment for many families.Today, though, the term “piggy bank” has a wholly different connotation. …….my comment: don’t miss the cartoon at the link.ha …ha ….ha.

“Risk of Double-Dip Recession Not Quite Past Yet”- What an idiot Roubini is. He might as well say “Risk alien invasion could still happen” or “Risk that Hitler is going to revive the Third Reich not quite past”.You missed the recovery Nouriel; you have shown yourself to be a false prophet. Now you are demeaning yourself by cavorting with lunatics like Marc Faber, patheticly chasing appearnce fees whilst sprouting nonsense and being fully invested in the market while you frighten others out of it. Your university should dismiss you.

Guest,I think we all feel the same way you do and nothing will change until we set term limits and boot the crooked politicians to the curb.I wish you a speedy and complete recovery. We need you alive and well so you can spread your message to those who will listen. Now go get some rest.

Free markets more efficient than government?… Not from what I can clearly see, my aunt the 3rd grade school teacher makes 85k a year and president Obama makes 400k a year a roughly 75% salary increase and justifiably so considering it is the most important job in the world. Now the Walmart ceo makes 10 million a year and their employees earn 7 dollars an hour, how is that an efficient form of capital distribution amongst a society? Based on the evidence i see the government is the most efficient business on the planet!

http://www.youtube.com/watch?v=1jHdcKiarbQ... as i have heard said..” here is a song fromold time passed.” ? not so fast with the passed.from j zizzle. and it was said the author could killfascists with such, so “hear” goes. here!Woody Guthrie – Jolly BankerFrom the album, “Library of Congress Recordings”LYRICS[--Jolly Banker--]My name is Tom Cranker and I’m a jolly banker,I’m a jolly banker, jolly banker am I.I safeguard the farmers and widows and orphans,Singin’ I’m a jolly banker, jolly banker am I.When dust storms are sailing, and crops they are failing,I’m a jolly banker, jolly banker am I.I check up your shortage and bring down your mortgage,Singin’ I’m a jolly banker, jolly banker am I.When money you’re needing, and mouths you are feeding,I’m a jolly banker, jolly banker am I.I’ll plaster your home with a furniture loan,Singin’ I’m a jolly banker, jolly banker am I.If you show me you need it, I’ll let you have credit,I’m a jolly banker, jolly banker am I.Just bring me back two for the one I lend you,Singin’ I’m a jolly banker, jolly banker am I.When your car you’re losin’, and sadly your cruisin’,I’m a jolly banker, jolly banker am I.I’ll come and forclose, get your car and your clothes,Singin’ I’m a jolly banker, jolly banker am I.When the bugs get your cotton, the times they are rotten,I’m a jolly banker, jolly banker am I.I’ll come down and help you, I’ll rape you and scalp you,Singin’ I’m a jolly banker, jolly banker am I.When the landlords abuse you, or sadly misuse you,I’m a jolly banker, jolly banker am I.I’ll send down the police, to keep you from mischief,Singin’ I’m a jolly banker, jolly banker am I…..

Don’t forget, we have about $2.5 trillion in what the Fed calls consumer debt. What is the debt service at 10% average rate? $250 billion. What about corporate and small business debt? School loans? Residential and Commercial mortgage debt? I would guess we pay in interest only, between $1.5 and $2.0 trillion dollars on all debt service in this country. Maybe more. Can you say opportunity cost? Cui Bono?

The global economic crisis is wreaking havoc on shipping: Demand and prices have collapsed and ports are filling up with fleets of empty freighters. The crisis has fueled cut-throat competition and not all companies will survive. Germany’s Hapag-Lloyd alone needs 1.75 billion euros to stay afloat.Container ships and bulk carriers parked off the coast of Singapore: Roughly 450 container ships are now idle worldwide as a result of the crisis — about 10 percent of the global fleet.Hamburg-based Hapag-Lloyd, founded 160 years ago, became one of the world’s leading shipping line operators. But today it finds itself in an existential crisis and needs as much as €1 billion in government loan guarantees to ensure its survival.Empty ships parked in Hamburg’s harbor: The sense of panic is more palpable here than almost any place else in the world.Shipping companies like Hapag-Lloyd currently receive only about $500 to ship one container from Asia to Europe — about $300 less than they need to cover their costs. A year ago, shipping companies were still collecting more than $1,500 per container. Still, German consulting firm Roland Berger says the company is “well positioned” for the future.Experts at Drewry Shipping Consultants estimate it will take until 2012 before container turnover at the Port of Hamburg and elsewhere around the world returns to 2008 levels.http://www.spiegel.de/international/business/0,1518,641513,00.html

a,you are double blessed!

m,true, in a manner of interpretation, for me too.

You are confusing the misdeeds of those who profess to be Christians with Christianity. True Christians do none of the above. Please try not to be so knee-jerk in your responses. You can’t tar everyone wit the same brush.The deeds above are inherent to humans of all faiths & no faith. Human nature leads to those transgressions, if you are dedicated to doing evil you are not Christian, no matter what you profess.

it would be funny if the government did do something like that and then Americans believed that it was real……actually they did put up a show during 9/11 that many still believe was done by terrorists…

I agree absolutely.The opinion of Nouriel is too political for me.

The way manufacturing labor is treated in Asian countries bothers me to the core.

Money is NOT the root of all evil.The LOVE of money is not the root of all evil.The root of ALL evil is the love of having OTHER-earned money.Loving having self-earned money is all good: it is as good as loving eating the vegetables you grew yourself.And by the way – the American Dream, from the start, ALWAYS included BOTH freedom of religion AND freedom FROM religion.Getting our country’s most basic history correct before you spout nonsense would be nice.

Good. At least somebody here has made the effort to think these things through. Thank you. I admit to not understanding those counter-monetarist arguments well and that the monetarist argument probably appeals to me because of it’s simplicity and my simple mind. Example: 2 commodities. One with intrinsic value the other without. If we wish to create an artificial construct in which we describe or compare the value of one to the other we can construct a relationship. i.e. The total quantity of one commodity is equal to the total quantity of the other. Right. In our world with multiple commodities, each with its own intrinsic value and the perception of those values continually changing, trying to compare all those to one commodity without intrinsic value is complicated. But enough of that.I understand your example with the liquidation of annuities in a falling interest rate environment. But surely it’s a small part of today’s world which must be why it seems to contradict our experience. So, at least from the perspective of our common experience it has been asset inflation that has caused the distortion in our balance sheets. We have discovered that we have miss-measured the value of those assets and must now re-appraise them. Should we be terming that deflation? We didn’t call it inflation on the way up. I have _always_ thought Greenspan an idiot, but he was right about the difficulty of detecting asset inflation. Asset inflation is easy to hide in valuation methodologies. As I indicated above, when supply increases faster than demand prices cannot rise. Is that deflationary? Normally we don’t use deflation in that sense. I’m sure we could dwell a long time on these semantics as a lot of academics might do.“According to Fekete, producers see an increase in the liquidation value of their debt each time interest rates are lowered…” Let me state that differently. Producers of dollar denominated commodities see an increase in the liquidation value of their debt each time the value of the dollar is lowered. And there is our problem. Inflation is what devalues the dollar. The dollar does not exist in isolation. The US economy does not exist in isolation. US banking does not exist in isolation. You tell me. Surely, your first day on the job every banker is taught the importance of honoring your commitments and earning the confidence of your creditors. Where did Ben spend his first day? There are already rumblings of dissatisfaction and concern the US won’t honor its commitments. I’m afraid Ben’s helicopter has over-shot! And TG branding our creditors manipulators? Talk about the pot calling the kettle black. Those rumblings are precursors to changes which are yet to come. Trust me. None of this happens in isolation. That much I am quite sure of.

ps.spouting nonsense i believe is a protectedright under the constitution.(as long as noone is being harmed) it is alsovery lucrative for many in the various professions.exactly how we got here in the first place.the problem arises when we take the nonsenseand turn it into dogma when we should justenjoy it for its entertainment value or inspirational potential. actually, nonsenseis a necessary precursor to sense. as i’m sureyou are aware. just wanted to say hi!

Hi, blindman. A world ruled by nonsensical misinformation and irrationality will perish. Our happiness and safety are utterly dependent on our ability to think rationally: our own ability and the ability of those around us to be rational.As long as there is the community project of division of labor, there will be trade, and money is not going away, nor should it.

A Guest said this months ago on this blog, and I saved the good comment:”Extreme inequality is at the root of this crisis and all capitalist crises. There are a lot of people here who want to solve this problem while protecting their privilege and leaving everything intact. All you do is talk in circles, while limiting the solutions and the parameters of the debate. And you re-post articles from the talking mouths who have a serious interest in things remaining just as they are. Stop thinking like Americans and start thinking about humanity.”

Collapse in the Wake of the Fed’s Wall Street Bubble?Market Reviewby Bob Chapman“History records that the money changers have used every form ofabuse, intrigue, deceit, and violent means possible to maintain theircontrol over governments by controlling money and it’s issuance.”James MadisonThe Fed’s Wall Street bubble, as we forecast in January, will need at least $2 trillion more in 2010, if theeconomy is to just stay on an even keel. The massive debt liquidation particularly in banking, Wall Streetand in insurance demands many more trillions of dollars. $23.4 trillion is not going to be enough.Presently the Fed is in the process of monetizing $2 trillion in Treasuries, Agency paper, such as FannieMae and Freddie Mac and collateralized debt obligations held by lenders. It is a secret what the Fed ispaying for this almost worthless paper. Is it any wonder the public has lost trust and confidence in theseplayers and our government?In order to escape from this global expansion of debt from government, corporations, banking, WallStreet and even state indebtedness, the bubble has to be maintained. The longer it lasts the worse will bethe collapse when it bursts. Does anyone really believe that this can continue indefinitely?People talk about robust inflationary environments in China, Asia and emerging markets In America theFed’s game of lowering interest rates and increasing money and credit and monetizing paper will end overthe next two years, maybe three. What is already in the system guarantees inflation.Many believe American re-flation boosts real estate values. Not a chance. The recovery is not goinganywhere. Americans are starting to save and pay down debt, and that means eventually consumption, asa percentage of GDP will fall to the long-term mean of 64.5%.The stock market and major market players are again highly leveraged even after 50% gains. They do notseem to understand that the sustained injection of trillions of dollars in money and credit is not going towork. It is not creating anything. Wild speculation is fine; it’s the leverage that kills. As a broker I neverhad a margin account. The market is not discounting a rosy future, but the players do not understand that.Prices are simply disconnected from reality. Short covering and the reversal of derivative positions cannotgo on indefinitely. Market performance is led by second and third tier companies that are in seriouspositions, some on the edge of bankruptcy. This is a very frustrating but temporary phenomenon. You areshort failing companies, and good companies languish. This is one of the unpredictable parts of themarket. All we can say is that current stock market action is a reflection of the current dysfunctionalfinancial chaos that we are trapped in. Mis-pricing is legion. All we can say is it is not going to work.Your only alternative is to back in the safety of gold and silver related assets.The same elements that were responsible for the collapse of the market in 2000 are at work today.Incidentally we recommended selling in the second week of April, two weeks after the top. Only 2% ofanalysts accompanied us. Then again, we called the top at 14,100. That element was interest rate carrytrades. The players are taking advantage of the ability to borrow cheap dollars, yen and euros to buy otherhigher yielding currencies, which in turn strengthens their currencies, making their exports uncompetitive.South Africa and Turkey are such examples. Thus, currency appreciation caused by differing interest ratesis reigniting third world countries. Free trade and globalization are having some unintendedconsequences. The dollar is headed down and at the G-20 meeting in London on September 4-5; the USwill ask China and others to cut it more slack, because they cannot now reverse the reversal of fortune.When we called the top on the dollar at 89.5 on the USDX a few months ago we never expected its decentto be as sharp as it has been. As we write it is 79, up from 77.60 in a normal bear market rally assisted bya temporary manipulation by the US government that will be of no lasting consequences. You might callthis a normalization process, as a result of the unwinding of dollar gains in the de-leveraging process. Thespeculators got out and the banks are still upside down. The unwinding process is only half complete andthat means the dollar will test 71.18 on the USDX by yearend and probably by the end of October. Thebanks have to reduce leverage and that makes it a lock. They are still leveraged 40 to 50 times deposits.You talk about stupid. Even Mr. Bernanke tells us tightening by raising interest rates is a long way off. Inaddition, world central banks are dollar sellers, even if only in a minor way. As long as the US Congressrefuses to enact tariffs on goods and services the dollar will remain chronically and perpetually weak. Asan aside, the further the dollar weakens the more expensive it will be for the US to purchase foreigngoods, which will lead to higher inflation. That will force further dollar selling. Thus, you can moreclearly see how this combination of events, accompanied by others, will continue to suppress the dollarsvalue.The result has been that second and third world currencies are strengthening against G-20 currencies, aresult of unintended consequences in the elitists grab for profits and power. What they have done via freetrade and globalization, offshoring and outsourcing is to allow China, Brazil, India and Russia to taketheir places at the head of the table. The developed economies have dug their own graves as theyexperience staggering unemployment and dollar depreciation simultaneously. It may not be evident nowbut it is every man for himself sooner than you think. Already officially manipulating their currencies areSweden, New Zealand, Australia and the Swiss. This does not create a fair playing field and it pulls theunderpinnings out from under the WTO, the World Trade Organization, which is the major element in thedestruction of the industrial power of Japan, Canada, the US and Europe. All it really was created for wasa redistribution of wealth from the first to the second and third worlds in the early 1960s. We wrote aboutthis in the American Mercury in 1967, but, of course, no one was listening. A massive socializationprocess, a leveling if you may, so that the inhabitants of the world, and particularly the citizens of themore powerful nations, would accept world government. This did not just happen. It was donedeliberately by design. As a result of this plan currently these second and third tier nations are growing50% faster than the G-20, or more specifically Canada, the US and Europe.We are going to see strong resistance to currency appreciation in the future and increases in subsidies inmany nations – first, second and third tier currencies. Perhaps even currency wars. The damage done viafree trade and globalization is vastly underestimated when related to the first world, which brings us backto the dollar and other carry trades that are a result of this. It is not only the dollar that will be destroyed,but also all major currencies. That accomplished, the elitists will then attempt to implant worldgovernment. That is what this is all about and few have the foresight to listen. Most do not even recognizethe enemy at the Council on Foreign relations or at the Bilderberger meetings, because he or she wears a$3,000 suit and they look like nice people. When are people going to wake up and stop allowingthemselves to be propagandized? Is the fog so thick that they cannot see what is being done to them? Dothey not understand why they are unemployed; have to take mandatory swine flu shots; why socializedmedicine will destroy our medical system; why Cap and Trade is a scam by Goldman Sachs to increasetheir taxes 20% or that our privately owned Federal Reserve is totally corrupt? This is part of a major planto destroy the major nations, as we now know them. The carry trade, derivatives and massive injections ofmoney created out of thin air are but nails in our coffins and if we do not stop these evil people it willmean destruction.Last March net wealth declined from a peak of $22 trillion to $12 trillion and due to a bear market rally ithas moved back to about $15 trillion. During the past two years consumer debt is about the same, but themarket has gotten hit hard. Household equity is off about 90%, and had it not been for the personalstimulus package it would have fallen much more.What is surprising to most but not to us was that the money in money market funds increased as themarket fell. That means that leverage via borrowed money was what has driven the market rally, alongwith short covering and government manipulation. The Fed was the biggest factor in rigging this bearrally. We have probably seen all the public investor buying we are going to see. The US and Europeanbanks were probably given the funds by the Fed with strict instructions to push the equity market higherand use as much leverage as possible. This rally has not enticed the public to spend more and in fact,retail sales are off 6% and still falling, thus, no recovery except in the minds of Wall Street andWashington.Further to the unemployment figures, the birth/death ratio should have been 113,000 job losses higher orabout 350,000. This year the B/D model has added 879,000 jobs and that figure should be 992,000,during the worst employment environment since the ‘Great Depression”, which is simply beyond belief.Then to have short-term unemployment fall from 9.5% to 9.4% is incredulous. You ask how did they dothat? It was due to the fact 637,000 people were dropped from the labor force, not from an increase inemployment, but they did end up on the U6, which officially is 16.8% unemployment, but if you extractthe B/D ratio you end up with unemployment of 20.8%. What we have witnessed is more lies andpropaganda, as the administration tries to use smoke and mirrors to regain public confidence to get themto increase spending. Barry and advisors, it isn’t going to work. They are not that dumb.Home prices continue to fall nationwide. Portland, OR is a good example. It reported a record decline inhome values for the 17th straight month in May and month-on-month saw a 16.3% fall, the biggestdecline in the index’s 22-year history. Since the July 2007 peak prices have fallen 21% and that is thelowest level since May 2005.We see the summer pause as natural and as unemployment rises, now by U6 at 20.8%, they’ll be moreforeclosures and lower prices. The depression is only pausing to catch its breath.Bob Chapman is a frequent contributor to Global Research. Global Research Articles by Bob Chapman

mog,first, while it is in my nature to argue, i amaware that it is counter productive, buti would say people do care, they are just notinclined to believe that they have any powerto change “the system”. the people who believethey can influence the system do so to createfurther imbalance in their own favor. problem.?so the conditions brought about by the imbalanceswill have to serve to awaken the careless totheir carelessness as no one benefiting fromthe imbalances is going to come to the rescue.after all this is only reality. people need towake up and speak up to save themselves. it is aslow process but it is an organic one, unstoppable as the tide or the rain!. as has been said balance and imbalance are temporary states in a complex and dynamic systemand systems , living, always integrate, one way orthe other, within their ecology.the greater the imbalance the greater the effects of the correction…. which your plan addresses… and…i like your plan. if i can live with this currentmess i could certainly live in the system youdescribe, i think. maybe then i could give upthis economic blog and get back to playing mybanjo… doo dah.ps.i want you to laugh! not when you’re seeinginjustice but when your gaze falls upon yourmany miracles and wonders. mog.peas.

g,this same scenario was suggested around october, 2008on this blog.

The Roubini-Faber video, in my opinion, doesn’t provide a high level of confidence that current Federal Reserve policies will be putting the American economy on track to good health.Professor Roubini, a supporter of heavy Fed printing and bailing to this point, twice on the video warned that the Fed could be successful only by applying just the right approach with exit policies. Too weak would mean recession; too strong would lead to an asset and credit bubble, and stagflation.Dr. Marc Faber, a severe critic of recent Fed policies, said central bankers are nothing less than “money printers” and they are dangerous to the health of the economy. “They created first an asset bubble and then the housing bubble and now they want to create another bubble to bail them out. And that, of course, is not the recipe for healthy, stable growth.”On the video, Roubini asks Faber what he means by an approaching financial crisis suggesting that Faber means something different from an anticipated market correction. Faber says a recession is supposed to clean out the financial system. And the bailouts have been accomplished for “ largely useless financiers and dealers,” with huge rewards and with little benefit for the “simple man” or the economy.“What has happened underneath Bernanke and the treasury in the U.S.,” says Faber, “has made the transparency even worse than before. It has bailed out people that have nothing to do with essentially the man in the street and the economy. It has bailed out the financial system. What does the simple man gain from bailing out all the derivative markets? Let the derivative players go bankrupt. And then the system is clean. And in my view, the big crisis is ahead of us. It may come in 4 or 5 years’ time, maybe only in10 years’ time, but the total breakdown of the system is ahead of us and it will devastate the global economy.”Faber said, “Today employment in the United States is lower than it was in 1999, so it is basically a lost decade. In the meantime, the financial sector has made billions of dollars and has compensated its largely useless financiers and dealers with huge rewards. And the simple man in the United States, the typical household, is no better off than he was 10 years ago.”A final question was directed to Faber saying that, considering current Fed policies directed to an exit strategy, would not the Fed after all do the right thing?“I don’t think so,” Faber replied. “The Fed and the other central bankers will leave interest rates far too low for far too long, and that actually the budget deficit of the U.S., the household deficit, will increase from this year’s approximately two trillion dollars. Next year could be two and one-half trillion dollars.”If the excess had been cleaned out of the system, says Faber, some additional investment bankers would be bust, but in general, the system would be healthier because debt load and the burden on taxpayers would be reduced. “Either you trust [unclear] the market mechanism or you don’t,” says Faber, “and for the central bankers of this world, and in particular. Mr. Greenspan and Bernanke, the market mechanism is all right as long as prices go up, except for oil, that’s the object. But when it goes down they feel they have to intervene…”

You think you can beat NATURE at her own game?NATURE decreed that working to get food – sacrificing time and energies to get food – would be the first, essential, inescapable fundamental condition of life – of being and staying alive. This constitutes a LIMIT imposed by NATURE. NATURE simultaneously decreed that ALL individuals’ sacrifice of time and energies is LIMITED.FAILING to LIMIT personal fortunes to the amount of wealth an individual is capable of creating by his own work, is the biggest, baddest LIMIT we could ever have placed on ourselves. We most definitely and severely LIMIT our happiness and safety and security and peace and freedom and ability to have a future, by NOT LIMITING personal withdrawals from the finite pool of wealth to the amount an individual is capable to contribute.Get a clue, Dr. Roubini. And hurry up about it. The current human situation is giga-critical, Sir!Just when will you economists admit that economics as practiced is nothing but a list of attempted excuses for the overpayunderpay that is killing us all and this planet???? No, I am not waiting for you to save us; it is us who will have to save you from yourself, I know. But why are you damn economists so unable to see the big picture, the reality??

BEING 100% FOR YOURSELF IS PERFECTLY GOOD AND PERFECTLY SANE AND PERFECTLY RIGHTEOUS. BEING 100% FOR YOURSELF IS YOUR DUTY. BEING 100% FOR YOURSELF CANNOT BE SEPARATED FROM CARING ABOUT WHAT HAPPENS TO THE 6+BILLION OTHER PEOPLE WHO ARE YOUR ENVIRONMENT. IT’S NOT A CASE OF EITHER/OR, OF CARING FOR YOURSELF OR OTHERS!! THE TWO THINGS ARE ONE THING; THE TWO THINGS ARE TWONE – TWO, ONE: TWONE.

@pecos banker and free tibet above,my impression from this reading is that theultimate deflation from zero ing interest ratesis a result of destruction of production causedby altering the financial playing field, resulting in practical deflation of assets and products in general..existing producers who have made financial commitments, going into debt to buy means of production, machinery, labor commitments, real estate etc.have exactly that! commitments. their optionshave become limited. their direction and purposeis locked in so to speak.when money becomes “cheaper” their competitionbecomes greater. their entire evaluation oftheir place in a market can change overnight. their product can become worth less, yet theiroverhead does not diminish it remains or increases,driving them further into debt. initially they produce more and search for more outlets or marketsfor the products hopefully growing to produce moreproduct and anticipated profit through debt financing. multiply this by millions of producersin a competitive market. lots of speculation, debtand production and then add a period of slack demand. you will have failures and products on themarkets at liquidation prices further debilitatingremaining producers who must cut costs to surviveand in this way i can see a deflationary spiraldeveloping regardless of how much money is available. it is destruction of production from competition and market saturation. demand destroyed by its ownsatisfaction.?? or..i need a place. i find one. bingo, demand destroyed! i don’t need another one.give me a million dollars, credit. i buy a boat.take away my credit, i sell it. deflation.give me credit, inflation, deny it, deflation.the current interest rate is all about recapitalizing those who made an industry out of refusing to do credit checks, the banks.why? 1) they want financial transactions, public and private, to take place on an interestpaying basis.2) somehow a population of many millions need beintegrated / incorporated into the resourceambitious world of todays and tomorrows elites.tap the resource and capture the value at a distanceand institutionalize and normalize it!3) the factions of elitism are many, all withtheir egotistic and social strutting needs. likeanything that exists, structure and function, there are costs associated with maintenance andreplacement parts, upgrades and product linereplacement. frequent overhaul due to accelerating technological revolutions. very expensive anddeflationary as old product has not even leftthe shelf by the time it is written off? but isfunctional.or….back to trends…..ie. free money for them. theyspend money, you pay interest on your debt. and spend their credit.something like that….

Well,yes but no problem .The truth is all seriously overpopulated countries abuse their workers ,because they have no negotiating power.We as outsiders can officially make use of that lack of power,through Manufacturing Offshore or use and abuse them when they come to our shores as Domestics.The fundamental question is one of serious overpopulation in their home countries.Examples; China,India,Malaysia,Phillipines,Mexico.Mexico really is hurting the North American Continent,but we certainly never think in terms of supplying Family Planning Assistance at their OPTION.There are Millions of rural families who still think it is the right thing to do,once moved into a large City to continue with 8 to 12 Births per Family,Instead of 0 to 4 births,which is required with Modern Sanitation and Health Care in order to have a relatively stable Municipal Population and Infrastructure .World Physical Planning truly is inadequateboth with the Environment and People themselves.

oh look another last minute bulls**t save to prevent the day ending more than 100 down

http://www.youtube.com/watch?v=E48ErKvaAksIf you want to feel cheered up by telling it like it is, check out Max Keiser. A jubilee for all mortagea nd credit card debt would have saved the day as well as biling out the bad decisions of the un-banks, would not have yoked the public to covering for it for generations and would have gotten economy back on track. But the president lacked the balls (ie was beholden to the kingmakers).

Socialism is godless, based on Statism. Socialism is an activity whereby the individual turns over his support and responsibilities and property and freedom to the state. Socialism is a departure from Christianity. Under Socialism, the State is God.Capitalism, truly practiced as an economic system, is free enterprise with an emphasis on the achievement and independence and worth of the individual. It is based on contract and good will, where a man can progress for his and his family’s and his community’s benefit. Capitalism has led to an increase in charity and support for the less fortunate and a growth in the health of civilization; it has raised the standard of living for all. This is something that godless Socialism, evidenced by Trotsky, Lenin, Stalin and Hitler, has proven that it cannot provide.Christ’s moral message that all men, be they slaves or freemen, are equal in the sight of God swept the world. It was that message that set the captive free, it was that message that changed man’s view of himself and his place in the world. It is the light in that message that the opponents of God—the Godless who would rule men with a whip–must extinguish by the heel of a boot on man’s face if their darkness is to prevail. Every time Socialism has been allowed to gather a foothold, it has led to tyranny. Socialism is state control and state control means dictatorship. Its main complaint with Christianity is Christianity’s regard for the worth of the individual, for the right of a single man to voice his opinions, to stand for his rights, to work for his own enterprise and property rights, to achieve self government–and to regard God as his final authority.Socialism cannot allow God-centered religion: under Socialism the State is the final authority. Therefore, Socialism cannot allow individual freedom, including freedom of religion that opposes its universal decree that only the State can provide. Thus, under all such dictatorships, Christianity cannot be tolerated; it is forbidden.Any nation that puts into practice the economic and moral principles outlined by God in the Bible, such as those upon which America’s prosperity was based, is a nation that has prospered. Any nation that defies those laws is a nation that has not.

Nathan A. Martin on Nathan’s Economic Edge had this to say regarding Bloomberg’s report today: Toxic Loans Topping 5% May Push 150 Banks to Point of No Return.“Bloomberg is reporting that more than 150 banks have toxic loans that make 5% or more of their loan portfolio. I think that’s conservative, and I think that if portfolios were market to market it would be nothing but terrifying. It’s outright scary as it is:”Here are excerpts from the story, using Nate’s emphases:Aug. 14 (Bloomberg)—More than 150 publicly traded U.S. lenders own nonperforming loans that equal 5 percent or more of their holdings, a level that former regulators say can wipe out a bank’s equity and threaten its survival.The number of banks exceeding the threshold more than doubled in the year through June, according to data compiled by Bloomberg, as real estate and credit-card defaults surged. Almost 300 reported 3 percent or more of their loans were nonperforming, a term for commercial and consumer debt that has stopped collecting interest or will no longer be paid in full.Bloomberg’s list was compiled by screening U.S. banks for nonperforming loans of 5 percent or more, and then ranked by assets. The list excluded U.S. territories and lenders that have already failed. Also left out were the 19 lenders that underwent Treasury’s stress tests in May; they were deemed “too big to fail” and told by regulators that government capital was available to keep them in business…About 2.6 percent of the $7.74 trillion in bank loans outstanding in the U.S. at the end of March were nonaccruing, the highest in 17 years, according to the most recent data from the FDIC. Nonaccrual loans peaked at 3.27 percent in the second quarter of 1991, during the savings and loan crisis, and averaged 1.54 percent over the past 25 years.“The numbers are off the charts,” said Blake Howells, an analyst at Becker Capital Management in Portland, Oregon, referring to the nonperforming loan levels at companies he follows. Banks are losing the “ability to try and earn their way through the cycle,” said Howells, who previously spent 13 years at Minneapolis-based U.S. Bancorp….The FDIC doesn’t comment on lenders that are open and operating and doesn’t disclose which banks are on its problem list. The agency will probably impose an emergency fee on the more than 8,200 banks it insures in the fourth quarter to replenish the insurance fund, the second special assessment this year, Chairman Sheila Bair said last week. The FDIC attempts to sell deposits and assets of seized banks to healthier firms to avoid eroding the fund, said agency spokesman David Barr…While 5 percent can be “fatal” for home lenders, commercial real estate lenders may be able to withstand higher rates, said William K. Black, former lawyer at the Federal Home Loan Bank of San Francisco and the OTS. Commercial loans carry higher interest rates because they’re riskier, he said.“At the 5 percent range, you’re probably hurting,” said Black, as associate professor of economics and law at the University of Missouri-Kansas City. “Once it gets around 10 percent, you’re likely toast.”Says Nate: Most are already toast. The FDIC is toast. The Federal Government of the United States is toast.The FDIC collects money from the banks in exchange for “insurance.” The only problem is that this “insurance company” does not have ANY RESERVES WHATSOEVER. Sure, they have a very little amount of money left ON PAPER, but none in reality. You see, the FDIC’s money is not placed into a trust fund, it is placed in the general fund and SPENT. In return, the Fed offers the FDIC a ledger entry…an I.O.U. Of course we all know that the Fed is good for it right? Sure they have the power of taxation and the power of the press.Of course readers here know that we have reached the limits of both. The FDIC is functionally bankrupt itself, the only way this music continues to play is on the back of printed money. When the music stops, I hope you have a chair.http://economicedge.blogspot.com/

g,m.k. statement. yes!

g,you tell me.??

Anti-Intellectualism in American Life by Richard Hofstadter. 1964 Pulitzer prize winner & a great read. IMHO many of our top universities are overrated, even more so in a global context.

Reading and posting on this board was fun, but I know when it’s time to go. Now on to my first love, college football. Need to study up on 120 Div. 1A teams’ stats and see how my top 25 ranked alma mater stacks up to the competition. Chat with ya after the BCS championship game.

AMERICAN IDIOTS by James QuinnAugust 14, 2009 | FINANCIAL SENSE EDITORIALS |(see link for seven statistical charts such as Median Income Levels that accompany article)According to the CDC, 66% of adults over the age of 20 are overweight or obese. That is approximately 140 million adults. Somewhere between 15 and 20 million Americans can be classified as alcoholics. As many as 50% of those on welfare are alcoholics. There are 225 million people over 18 years old and 32 million of them do not have a high school degree. There are 32 million adults or 14% who are illiterate (23% in California, 22% in New York, 20% in Florida, 17% in New Jersey). The United States’ spending per pupil in public schools at $9,266 is in the top 5 in the world. New York and New Jersey spend $14,000 per pupil and one-fifth of their adults are illiterate.Forrest Gump, when asked “Are you stupid or something”, responded “Stupid is as stupid does”. A person’s appearance does not prove they are stupid. It is their deeds and actions which prove whether they are stupid or not. The terms stupid and idiot are not politically correct in today’s America. Intellectually challenged, IQ disadvantaged, aptitude deficient, brain power wanting, and acumen poor might satisfy the PC police. Let’s take a look at their definitions according to Webster’s Dictionary and assess whether they might apply to anyone in the increasingly socialized United States of today.Stupid – slow of mind; given to unintelligent decisions or acts; acting in an unintelligent or careless manner; lacking intelligence or reason; lacking in power to absorb ideas or impressions; implies a slow-witted or dazed state of mind that may be either congenital or temporary.Idiot – a foolish or senseless person; a person of subnormal intelligence; a person lacking intelligence or common sense.Besides describing George W. Bush, these definitions sadly describe millions of Americans. As a wise person I know likes to say, “It is a sad state of affairs”. Our citizens have failed to heed the wise words of our Founding Fathers:“Reason obeys itself; and ignorance submits to whatever is dictated to it.” Thomas Paine“Knowledge will forever govern ignorance; and a people who mean to be their own governors must arm themselves with the power which knowledge gives.” James Madison“Education is a better safeguard of liberty than a standing army.” Edward EverettThe American people’s ignorance, stupidity, and disinterest in the governance of this nation have allowed an oligopoly of politicians, bankers, and powerful corporations to seize control of the country and loot its riches for their personal gain. By failing to educate themselves, millions of ignorant Americans have lost all of their power and are now dictated to by the few with knowledge. The elite who dictate the path of our country do not want the masses to become educated. Their power would be in jeopardy. The American public school system insures the retention of their power and wealth.“Anyway, no drug, not even alcohol, causes the fundamental ills of society. If we’re looking for the source of our troubles, we shouldn’t test people for drugs, we should test them for stupidity, ignorance, greed and love of power.”P.J. O’RourkeThe Ugly NumbersEducational attainment is the single biggest determinant of lifetime income. As of 2008, 14% of Americans over 18 years old haven’t graduated high school, 31% have achieved a high school degree, 27% have earned a bachelor’s degree, and only 9% have earned an advanced degree. The median household income in the U.S. is $46,326. The median household income of Asian households [in America] is 24% higher at $57,518. The median household income of Black households is 35% lower at $30,134. Asian households have a fantastic educational achievement, with 49% of Asians achieving a bachelor’s degree or higher. Black households have a higher percentage with no high school degree (18%) than they do with a bachelor’s degree or higher (17%). Hispanic households have even more dreadful levels of educational attainment with only 12% achieving a bachelor’s degree or higher, while a full 37% of Hispanics have not graduated high school. Even though 69 million Americans have attained a high school degree, many are functionally illiterate as our public school system has just matriculated them through the system.If you make the effort and earn a bachelor’s degree or master’s degree, the likelihood of making it into the top 10% to 20% of earners goes up dramatically. Drop out of high school and you guarantee that you will remain in the bottom 25% of earners, making less than $22,500 per year. There are approximately 111 million households in the United States. Only 5.6 million households earn more than $167,000. On the other end of the scale, there are 36.6 million households making less than $30,000. The middle is occupied by another 36.6 million households making less than $62,500. The bottom is occupied by high school graduates or dropouts. The top is occupied solely by college graduates. Those with knowledge and money are able to use their power to generate more money and consolidate that power by manipulating the ignorant poor masses. The U.S. public school system insures a continuous flow of ignorant masses.Liberal Waste of Money“In the first place, God made idiots. That was for practice. Then he made school boards.” Mark TwainThe United States takes in excess of $500 billion per year from its citizens through income taxes, real estate taxes, and school taxes to educate our young people in the public school system. The local and state bureaucrats along with the thousands of government officials responsible for the U.S. public education system believe that a half a trillion dollars is not nearly enough. There are 50 million students enrolled in 97,000 public schools in this country. The U.S. Department of Education spends $59 billion of your tax dollars and employs over 5,000 bureaucrats to guide our top notch world class educational system. There is no country on earth that spends close to the amount spent by the U.S. With this level of spending, we must have the smartest, best educated, most motivated students on the face of the earth.Somehow, despite the billions “invested” in our children, millions graduate and can’t add or subtract. Cashiers in most retail stores would not know how to give you change from a dollar if the cash register didn’t tell them. Even then, it is often times a struggle. The Mathematics literacy of our 15 year olds is well below the world average and 10% to 15% below the leading Asian countries. We did beat Russia, Italy and Mexico. Any cost benefit analysis of what we spend versus what we get would conclude that our educational system is a complete disaster. It should be clear even to a high school dropout that our government bureaucrats haven’t spent our tax money efficiently or effectively. Our public schools are either not teaching the right things or not using the right techniques.The liberals who are clamoring for more money and more government control of education have proven beyond a shadow of a doubt that their methods have failed. According to the U.S. Dept. of Education the per pupil spending in 2005 was $9,266, up 128% since 1971. This means that from the time a child enters 1st grade until he/she graduates from high school (if they graduate), it costs taxpayers $111,000. You would think that with that investment, more than 33% of high school graduates would go to college. A study of public school students from 1991 to 2002 by the Manhattan Institute for Policy Research generated disturbing results:· The national high school graduation rate for all public school students remained flat over the last decade, going from 72% in 1991 to 71% in 2002.· Nationally, the percentage of all students who left high school with the skills and qualifications necessary to attend college was 34% in 2002.· The states with the lowest graduation rate in the nation were South Carolina (53%), followed by Georgia (56%), Tennessee (57%), and Alabama (58%).· In the class of 2002, about 78% of white students graduated from high school with a regular diploma, compared to 56% of African-American students and 52% of Hispanic students.· About 40% of white students, 23% of African-American students, and 20% of Hispanic students who started public high school graduated college-ready in 2002.The bureaucrats that allocate the billions in education spending have decided to concentrate on special education, education for the disadvantaged, and closing the “achievement gap” between white students and minority students. The results of these efforts have been dreadful. The facts are:· In 2007, the federal government spent $71.7 billion on elementary and secondary education programs. These funds were spent by 13 federal departments and multiple agencies. The Department of Education spent $39.2 billion on K–12 education. The largest programs in the Department of Education’s elementary and secondary budget were “Education for the disadvantaged” ($14.8 billion) and “Special education” ($11.5 billion).· While spending per pupil has more than doubled, reading scores have remained relatively flat.· The achievement gap persists, with black and Hispanic children still lagging behind their white peers despite decades of federal aid targeted at equalizing opportunities for all students. Similarly, in 2005–2006, the national high school graduation rate for white students (80.6 percent) remained significantly higher than the graduation rates of black students (59.1 percent) and Hispanic students (61.4 percent).· In many cities, spending per student exceeds $10,000 per year, yet graduation rates are below 50%. In Detroit, per-student spending is $11,100 per year, yet only 25% of Detroit’s students are graduating from high school.· According to the National Center for Education Statistics, only 52% of public education expenditures are spent on instruction. This percentage has been slowly decreasing over recent decades.Instead of encouraging excellence in our most gifted children, government bureaucrats spend billions experimenting with the latest educational fads and trying to make sure all students are treated equal. This socialist teaching methodology has accomplished mass mediocrity. The devastating combination of mediocre teaching methods, weak curriculum, disinterested or non-existent parental involvement, lazy unmotivated pupils, and greedy self serving teachers’ unions has led to the poor excuse for a public education system.More Perfect Union“I don’t represent the children. I represent the teachers.”Al Shanker, former president of the American Federation of TeachersOne of the major reasons for poor academic result is non-caring tenured teachers, protected by powerful teachers’ unions. We could use teachers who cared as much as Mr. Hand. It has been 28 years since I was in high school. I had mostly mediocre teachers, but two teachers left a permanent impression on me. Charlie McLaughlin’s and Thomas McGrath’s enthusiasm for learning, knowledge of the subject matter, and concern for the students generated a passion for learning in me. Being inspired by a teacher is what every student needs to get to the next level.The average salary of public school teachers is approximately $53,000. The average salary of public school teachers in California leads the nation at $65,000. This gives the term pay for performance a new meaning. A full 32% of all public school students in California don’t graduate high school. The California public school system doesn’t even prepare the average student well enough to read a newspaper or fill out an employment application at McDonalds. Based on information from the Bureau of Labor Statistics, the following facts can be gleaned:· The average public school teacher was paid 36% more per hour than the average non-sales white-collar worker and 11% more than the average professional specialty and technical worker.· Full-time public school teachers work on average 36.5 hours per week during weeks that they are working. By comparison, white-collar workers (excluding sales) work 39.4 hours, and professional specialty and technical workers work 39.0 hours per week. Private school teachers work 38.3 hours per week.· Compared with public school teachers, editors and reporters earn 24% less; architects, 11% less; psychologists, 9% less; chemists, 5% less; mechanical engineers, 6% less; and economists, 1% less.· Public school teachers are paid 61% more per hour than private school teachers, on average nationwide.· The Detroit metropolitan area has the highest average public school teacher pay among metropolitan areas for which data are available, at $47.28 per hour, followed by the San Francisco metropolitan area at $46.70 per hour, and the New York metropolitan area at $45.79 per hour.With the highest average salary per teacher, Detroit must be turning out the best and brightest. Does a 75% high school dropout rate merit the highest salaries in the country? The district has 15,000 workers, an annual budget of $1.2 billion, and only graduates 25% of the 94,000 students it matriculates through its horrific system. Well done. I’m sure they will get big union negotiated raises this year. There is absolutely no evidence that average teacher pay is related to high school graduation rates. Due to their strong teachers’ unions, salaries, benefits and tenure are fought for, while the interests of the students are disregarded.“A lot of people who have been hired as teachers are basically not competent.”Al Shanker, former president of the American Federation of TeachersExcellent motivated teachers produce excellent motivated students. Incompetent, unmotivated, burnt out, tenured teachers produce dropouts and functionally illiterate students. Tenure allows bad teachers to stay employed for decades. It is virtually impossible to get fired. In ten years, only about 47 out of 100,000 teachers were actually terminated from New Jersey’s schools. Newark’s school district successfully fired about one out of every 3,000 tenured teachers annually. Graduation statistics indicate that Newark’s graduation rate was a fabulous 30.6%. New York City’s Chancellor has revealed that in that city, only ten out of 55,000 tenured teachers were terminated in the 2006-2007 school year. According to the New York Daily News, at any given time in New York City an average of 700 teachers are being paid not to teach (they instead report to “rubber rooms”) while the district goes through the hoops (imposed by the union contract and by law) needed to pursue discipline or termination. A city teacher in New York that ends up being fired will have spent an average of 19 months in the disciplinary process. The Daily News reported that the New York City school district spends more than $65 million annually paying teachers accused of wrongdoing, in addition to the cost of hiring substitutes.One highly destructive feature of the typical teachers’ union contract is a system that forces principals to hire teachers who transfer from other schools within the district. Since these teachers frequently are transferring because of poor performance in their original schools, the practice is called “the dance of the lemons” or “passing the trash.” One problem related to the destructive transfer system is a hiring process that takes too long and/or starts too late, thanks in part to union contracts. Would-be teachers typically cannot be hired until senior teachers have had their pick of the vacancies, and the transfer process makes principals reluctant to post vacancies at all for fear of having a bad teacher fill it instead of a promising new hire. Anywhere from 31% to almost 60% of applicants withdrew from the hiring process, often to accept jobs with districts that made offers earlier. Applicants who withdrew from the hiring process had significantly higher undergraduate GPAs, were 40% more likely to have a degree in their teaching field, and were significantly more likely to have completed educational coursework than the teachers who ended up staying around to finally receive job offers. Another common problem with the union contract is a “bumping” policy that fills schools which are more needy (but less desirable to teach in) with greater numbers of inexperienced teachers. In its report Teaching Inequality, the Education Trust wrote:“Children in the highest-poverty schools are assigned to novice teachers almost twice as often as children in low-poverty schools. Similarly, students in high-minority schools are assigned to novice teachers at twice the rate as students in schools without many minority students.”The nonprofit Education Sector found in a 2007 report that nearly 19% of all public education spending in America goes towards things like seniority-based pay increases and outsized benefits — things that don’t do much to improve teaching quality. If these provisions were done away with, the report found, $77 billion in education money would be freed up for initiatives that could actually improve learning, like paying high-performing teachers more money. Teachers unions push for contracts that effectively cripple school districts’ ability to monitor teachers for dangerous behavior. In one case, school administrators in Seattle received at least 30 warnings that a fifth grade teacher was a danger to his students. However, thanks to a union contract that forces schools to destroy most personnel records after each school year, he managed to evade punishment for nearly 20 years, until he was finally sent to prison in 2005 for having molested up to 13 girls. As an attorney for one of the victims put it, according to The Seattle Times:“You could basically have a pedophile in your midst and not know it. How are you going to get rid of somebody if you don’t know what they did in the past?” Success Stories”There is nothing which can better deserve our patronage than the promotion of science and literature. Knowledge is in every country the surest basis of public happiness.” George WashingtonWhenever I read about failure, my immediate reaction is to look for examples of success. Based on the studies I’ve found, Finland finishes at or near the top of every survey in Math and Science. They must be doing something right. With the pitiful results achieved by the U.S., we should humbly examine what we can learn from the Finnish school system.Some facts about the Finnish school system are as follows:· Pre-school begins at age 6· Comprehensive school: age 7 to 16· Upper secondary school or vocational school: 16 to 19· Pupils in Finland, age 7 to 14, spend fewest hours in school· Higher education places for 65% young people· Second-highest public spending on higher educationThey don’t divide students until they reach 16 years old. Education Minister Tuula Haatainen describes their philosophy:“There is a philosophy of inclusion underlying this system. Widening participation in education is the most effective way of finding the most talented students. It’s like ice hockey. We let all the girls and boys play, not only the best ones. With this fair play, we can give everyone the same chance to practice their skills – and this also gives us the way to find the best ones.”Their methods are based on common sense, personal responsibility, financial support and strong families:· An important ingredient in Finland’s high achievement in reading and writing is a strong culture of reading in the home.· Parents nurture a love of reading among children and this is supported by a network of public libraries.· In the last international education league tables, produced by the OECD, Finland’s 15 year olds were judged to have the highest standards of literacy in the world.· School meals are free to all pupils, there are no university fees and students can stay in the upper secondary stage (loosely equivalent to sixth forms) for up to four years.· Finland has made a conscious effort to have highly-qualified teachers throughout the school system.Other ideas that have worked to improve academic results include private school choice, public school choice, and charter schools. Private school choice policies like vouchers, scholarships, or education tax credits help parents to enroll their children in a private school of choice. Public school choice allows parents more opportunity to choose the best public school for their children by offering open enrollment within the public education system. Charter schools are publicly funded schools that meet certain performance standards set by the government but are otherwise free from the traditional public school system. It is amazing what happens when free market competition is created by school choice. Government bureaucrats and Teachers’ Unions despise these ideas because failure and mediocrity are penalized while success is rewarded.In 2001, Harvard University Economics Professor Dr. Caroline Hoxby studied the effect of school choice options on the performance of public schools. She found that public schools that faced a higher degree of competition from private schools improved their performance compared to public schools that faced less competition. Many surveys and focus groups have found that parents are more satisfied with their children’s learning environment when they can choose their school. That helps to explain why limited voucher programs are usually over-subscribed, with many kids ending up on long waiting lists. In 1998, the non-profit Children’s Scholarship Fund offered private school scholarships to 40,000 low-income students across the country. In all, more than 1.2 million kids applied. Not exactly a vote of confidence in the public school system.Implications of Failure“We have also arranged things so that almost no one understands science and technology. This is a prescription for disaster. We might get away with it for a while, but sooner or later this combustible mixture of ignorance and power is going to blow up in our faces.” Carl SaganAfter spending trillions on education in the last 40 years, we have absolutely nothing to show for it. SAT scores in Reading are lower and Math scores are flat with scores in 1972. The general populace is more ignorant, less informed, less curious, and easier to manipulate than they were in 1970.Our family has sacrificed financially to send our children to Catholic schools. Public schools spend anywhere from $8,000 to $14,000 per pupil and are able to send only 33% onto college. I pay $6,000 per year to send my oldest son to Catholic high school. Of the recent graduating class, 99% went on to college. The teachers are paid less, school spending is half as much per pupil and results are dramatically better. The combination of teachers who are competent and care, parents who are involved and care, and students who work hard and care, leads to success. The failure of public school education has vast negative implications for our society. Those with education and knowledge have pulled farther ahead of the uneducated and stupid. There are 225 million people over 18 years old and 146 million do not have a college degree. Only 20 million have a Master’s degree or better. Those who are educated make more money send their kids to private schools and continue the cycle. Ignorant teenagers who grow up to be ignorant adults, have kids who are brought up ignorant. It is extremely difficult to break this cycle.This is a free country. No one is going to stop you from reading a book. My parents didn’t go to college, but their three kids did. All of our kids will go to college. It is expected and encouraged from the day they are born. The encouragement and involvement of two parents is more important than any other factor. The numbers speak for themselves. Asian children succeed the most because 85% of them are brought up in two parent households. White children are more successful in school because 76% of them are brought up in two parent households. Black children fail because only 38% are brought up in two parent households. The government can spend trillions more in urban public school systems and get no better results because black men have not taken personal responsibility for their children and families.“Ignorance is the curse of God; knowledge is the wing wherewith we fly to heaven.”William ShakespeareThe dumbing down of America has allowed the intelligentsia to retain power and increase their control over the country. Lack of educational achievement doesn’t automatically mean you are easily manipulated, but it sure increases the odds. If you weren’t motivated enough to do well in school, you are unlikely to take your civic duties of voting, understanding national issues, and getting involved in your community seriously. The saddest part is that an enormous quantity of even the college educated is so intellectually lazy that they choose to trust their leaders without question. With 100 million, ignorant, non-thinking, non-questioning, and intellectually lazy zombies occupying space in this country, continued domination by a few thousand highly educated elite remains quite easy. A highly educated citizenry would endanger their power. By socializing public education, encouraging mediocrity, and not rewarding excellence, government bureaucrats insure that the masses remain ignorant and pliable. Those in power know that by keeping the ignorant masses sedated with socialist goodies like welfare, Social Security, Medicare, Medicaid, food stamps, public housing, and easy credit, they can stay in charge. For them it is fabulous, for the country it is a disaster. Winston Churchill summed it up succinctly:“Socialism is a philosophy of failure, the creed of ignorance, and the gospel of envy, its inherent virtue is the equal sharing of misery.”There is no area of ignorance more distressing than in the area of economics and finance. Those with superior knowledge and power are able to mislead the ignorant masses regarding the state of our economic situation because most Americans have no clue about deficits, inflation, or the printing of money out of thin air. I’m reminded of Jeff Foxworthy’s “You Know You’re a Redneck” comedy routine. You know you are ignorant if:· You think Pearl Harbor was attacked by the Germans (Bluto)· You think the Civil War is a Guns N Roses song. · You think Inflation is what you do to tires.· You think the Federal Reserve is a brand of scotch.· You think GDP stands for Got Da Payment from the welfare office.· You think you deserve a $300,000 house when your annual income is $22,500.· You don’t know the names of the guys on the penny, nickel, dime or quarter.· You think the National Debt is a monument in Washington DCJohn Adams predicted the confusion and distress that has arisen in America. “All the perplexities, confusion and distress in America arise, not from defects in their Constitution or Confederation, not from want of honor or virtue, so much as from the downright ignorance of the nature of coin, credit and circulation.”The question is whether we can change our course, properly educate our populace, and take this country back from the entrenched elite. There is no more important issue facing our country today.Bio: James Quinn is a senior director of strategic planning for a major university.http://www.financialsense.com/editorials/quinn/2009/0814.html

My time is too expensive!

So as a consequence companys have to outsource because with a idiotic workforce you can not produce goods.

Do you know what you are talking about or are you just spouting inflammatory rhetoric you blindly follow from misleading articles?

Thanks for that post, Guest. We can’t keep ignoring the growing disparity in income in this country and expect things to get any better for the average person.SWK

no, you are an idiot. bottomline, “can’t cover another 46 million people for free” said by president. how is healthcare cost problem get fixed by covering another 46 million people? how do you keep healthcare cost from rising when doctors/nurses in healthcare center/hospital can just raise price? these guys can raise price, then what is that mean for insurance co? insurance co will need to raise insurance premium. so do you know what the bs you talking about?

idiot

Spinning the Economic NewsBy Paul Craig Roberts | August 11, 2009Last Friday, a Bloomberg.com headline read: “U.S. Stocks Gain, Treasuries Drop as Unemployment Rate Declines.”Let’s have a look at the reported decline in the rate of unemployment. Do you believe that the U.S. auto industry added 28,000 jobs in July amidst the GM bankruptcy, sell-off and close-down of GM auto divisions, and demise of GM suppliers? No? Well, that’s what the Bureau of Labor Statistics reported.The 28,000 new jobs were created by “seasonal adjustments.” July is a month when jobs are automatically added by the BLS to seasonally smooth the layoffs of autoworkers during July’s retooling for the new model year. This year, most of the retooling did not occur, yet the annual seasonal adjustments did. Adjustments are also made for supporting industries, which are partially idled while auto production halts for retooling.More phantom jobs were created by the “Birth-Death Model.” The payroll jobs data contains guesses about the numbers of new startup company hires and jobs lost from business failures. Failed businesses don’t report the lost jobs (deaths), and new jobs from startups (births) are not captured in the reporting. The government estimates these numbers, but the estimates are based mainly on growth periods, not on recessionary times. Consequently, during economic downturns, the Birth-Death Model overestimates the number of new startup jobs and underestimates the job loss.The employment outlook was further improved by pushing another cadre of workers, who have been unemployed for too long, off the unemployment rolls. Remember that, since the Clinton administration, the long-term discouraged (people out of work for more than one year) are not counted as being in the workforce. The length of the current downturn means that short-term discouraged workers, who are counted among the unemployed, are now moving into the long-term discouraged category, which simply erases their existence and lowers the measured rate of unemployment.All sorts of distortions can find their way into the official statistics. For example, industrial production estimates are based on electricity consumption. Unusually hot weather, which causes a jump in air conditioning use, appears in the statistics as an increase in industrial output. Cool weather spells during summer reduces electricity use and results in a phantom drop in industrial output.Nominal retail sales figures can increase from an uptick in inflation.An increase in real gross domestic product can be the result of underestimating inflation.Other distortions come from the year-to-year comparisons. As time passes, new comparisons are no longer with previous peaks, but with more recent lows. Thus, reported declines are less severe than previously, which makes things sound better when they aren’t.By spinning the financial news, the appearance of recovery is created, and this lures people back into the stock and real-estate markets where they can lose the remainder of their wealth.http://www.vdare.com/roberts/090811_economic_news.htm

Healthcare Plan Based on Economic Fantasyby Ron PaulAs the healthcare debate rages on, there is one reality that even the proponents of this hostile takeover of healthcare by government cannot ignore – and that is money. The government simply does not have the money for a new, expansive, public healthcare plan. The country is in a deep recession that will deepen even further with the coming collapse of the commercial real estate market. The last thing we need is for government to increase and expand taxes to pay for another damaging, wasteful program. Foreigners are becoming less enthusiastic about buying our debt, and creating another open-ended welfare program when we cannot pay for what is already in place, will not help. Champions of socialized medicine want to tax the rich, tax businesses that already cannot afford to provide health plans to employees, and tax people who don’t want to participate in the government’s scheme by buying an approved healthcare plan. Presumably, all these taxes are to induce compliance. This is not freedom, nor will it improve healthcare.There are limits to how much government can tax before it kills the host. Even worse, when government attempts to subsidize prices, it has the net effect of inflating them instead. The economic reality is that you cannot distort natural market pressures without unintended consequences. Market forces would drive prices down. Government meddling negates these pressures, adds regulatory compliance costs and layers of bureaucracy, and in the end, drives prices up.The non-partisan CBO estimates that the healthcare plan will cost almost a trillion dollars over the next ten years. But government crystal balls always massively underestimate costs. It is not hard to imagine the final cost being two or three times the estimates, even though the estimates are bad enough…Make no mistake, government control and micromanagement of healthcare will hurt, not help healthcare in this country. However, if for a moment, we allowed the assumption that it really would accomplish all they claim, paying for it would still plunge the country into poverty. This solves nothing. The government, like any household struggling with bills to pay, should prioritize its budget. If the administration is serious about supporting healthcare without contributing to our skyrocketing deficits, they should fulfill promises to reduce our overseas commitments and use some of those savings to take care of Americans at home instead of killing foreigners abroad.The leadership in Washington persists in a fantasy world of unlimited money to spend on unlimited programs and wars to garner unlimited control. But there is a fast-approaching limit to our ability to borrow, steal, and print. Acknowledging this reality is not mean-spirited or cruel. On the contrary, it could be the only thing that saves us from complete and total economic meltdown.http://www.lewrockwell.com/paul/paul566

I believe I posted this previously, but in the context of this discussion, it may bear repeating:____From the ENCYCLICAL LETTER CARITAS IN VERITATE OF THE SUPREME PONTIFF BENEDICT XVI:”36. Economic activity cannot solve all social problems through the simple application of commercial logic. This needs to be directed towards the pursuit of the common good, for which the political community in particular must also take responsibility. Therefore, it must be borne in mind that grave imbalances are produced when economic action, conceived merely as an engine for wealth creation, is detached from political action, conceived as a means for pursuing justice through redistribution.”___SWK

g,elitist bullshit. the uneducated idioticworkforce is capable of anything. you’llnotice that producers throughout historyhave sought out the least educated to work forthem because they are uneducated and can andwill therefore have no problem doing goodwork, repetitively, consistently, reliablyfor almost nothing, while the educated aregenerally useless and more often than notwill get you either sued or cause you tohire multiple law firms to defend yourself.just a counter intuitive thought to startthe day..the obstacle to production is not the uneducatedworkforce. that is the market and part of themeans of production. the obstacle is, as hasbeen said countless times by persons on thisblog and elsewhere, a lack of imagination, integrity, insightand leadership at the highest levels of the socalled “educated”..tunnel vision is the problem. a form ofvisual impairment leading to a state of mindlikened to sleep. it is a consciousness thing.

g or guest if you prefer,i don’t get the gigolo referencebut a well written song is likea poem or a koan, brief and condensed.like a seed, it can develop and grow.ears to hear and all that.kernel of wisdom there be…and…you are wise and just getting wiserme thinks.?

http://www.safehaven.com/article-14199.htmgold has no value? apparently, this idiot hasn’t check the gold chart. apparently, this idiot hasn’t kept up with how governments around the world is trying to illegitimate gold or making illegal to own gold, to support their fiat paper or digital currency (FED just need to type $1,000,000,000,000 = $1 Trillion into the computer.)?

f,here is the point in a nutshell me thinks?first remember the populations are alreadyon the hook for purchases made at price levelsdriven up by no credit check credit extendedindependent of any concern, caution, real riskanalysis, or rational speculation. so we havea financial security problem and everyone mustbe thinking there is some risk out there….somewhere?…as in perhaps the prices in the various markets were and continue to be affectedby all that credit that was spent and is now owed.so how much money must be printed to make theseprice levels hold, if that is even possible?but it is more dynamic in complexity and in timethan my mind can wrap around. but…where will the loose money, the stuff the rich have here and there to “invest” go for safety inthis dynamic, complex and bubble popping environment? if it seeks security, safety etc.the professor describes this … deflation…as the money being produced is 1) not adequateto cover all the crazy credit that was floatingthe bubble boat, and 2) it will mostly flow intothe safe harbor of the bond market…. see below..????? counter intuitive but ……. makes me think of a situation you see inreal estate development. some one buys aperfectly good house on a lot and then destroysit. demo. all that good stuff! trashed becauseit wasn’t what the owner wants. what is the valueof that old kitchen in splinters and whatnot..THE FEDERAL RESERVEAS AN ENGINE OF DEFLATION (sic!)Antal E. FeketeSan Francisco School of EconomicsE-mail: aefekete@hotmail.comIntroductionAlthough the Fed’s open market purchases of securities (always net) affect onlythe short end of the yield curve directly, through the transmission of risk-freebond speculation they will affect the rest of the yield curve indirectly. Thus theentire spectrum of interest rates will keep falling in consequence of the Fed’sopen market purchases of Treasury bills (or equivalent). This is a powerful ifunrecognized force in the economy causing a chain-reaction as follows:(1) risk-free bond speculation causes interest rates to fall,(2) falling interest rates cause a severe erosion of capital throughout theproductive apparatus,(3) erosion of capital causes a falling trend in prices,(4) falling prices further increase the downward pressure on interest rates.Thus a vicious spiral of falling interest rates and falling prices is engaged,threatening to push the economy into the abyss of deflation. Mainstreameconomics lacks a valid theory of speculation. Hence it has a blind spot, failingto see the destructive nature of open market operations……so? i have to re read your comment. but..the period of prior spending of rediculouscredit haunts..many things were made and constructed but notintegrated into anything organic, sustainable.they are on the market, but no one wants them.how can their prices justify inflation, yetsome of it is functional and might be worthsomething in liquidation.?contraction. yea! deflation/inflation?if the population has neither credit or moneyit makes no difference how much “money” existsuntil it makes its way into the real economy.that has been accomplished through lending,the dysfunctional broken leg destroyed byour friends at jpm etc.. you know the smartand well educated elite..what comes after deflation is ceasing of propertyredistribution of assets to the bailout (taxpayersponsored) rightful owners. then the fed willmop up something? cross that bridge and all that..

Guest:I am a Christian, and I do not find socialism incompatible with Christianity at all. I don’t take much stock in anything Marx, Engels, Lenin or Trotsky had to say about socialism, either. The Soviet era is dead, and so is that way of thinking about socialism.Societies can embrace successfully elements of socialism and capitalism at the same time and not threaten democratic processes. For example, the U.S. Post Office Department, established in 1792 pursuant to Article One of the Constitution, created a monopoly for mail services in the government which continued to exist even after the U.S. Post Office was transformed into a quasi-independent federal agency when President Nixon signed the Postal Reorganization Act in 1970. Without getting into the issue of the efficiency the government’s monopoly over the delivery of mail, this is a clear example of how the United States, or any other republic based on democratic principles, can own all of the means of production and employ all of the labor for an industry without, ipso facto, becoming a Stalinist-style totalitarian regime that is contrary to Christian and other religious values.SWKSWK

ExactlyWhen you water down our existing bankrupt health program to cover more people; nurses/doctors don’t get raises, they get less pay and a lot more pink slips too. Patients get less coverage per capita.Its Malthus Theory, but go ahead economists, tell me to go to Hades…LOL

Gold has no inherent value it was just used as an exchange medium for a small portion of history, now it’s value is based on it’s history or perception of being a reliable exchange medium, the problem is who ever runs the military gets to dictate the exchange medium for goods and services- translation your confidence in golds value is misguided.

Speaking of idiots or thieves – look and this 1967 article by Alan GreenspanHe lays out the the exact Austrian School of economics and defends the gold standard. So, somewhere between 1967 and 1987 when President Reagan nominated Dr. Greenspan as a successor to Paul Volcker as chairman of the Board of Governors of the Federal Reserve.I’m guessing he was abducted by aliens and given a brain transplant.As reprinted from the book “Capitalism, the Unknown Ideal” by Ayn Rand with additional articles by Alan Greenspan – 1967.http://www.wscleary.com/website/html/goldeconomicfreedom.html

153rd bank has failed and it’s a big fish…Failure of Colonial BancGroup Inc. is expected to cost the Federal deposit insurance fund an estimated $2.8 billion.Let’s think about that for a moment. Assuming an average home loan of $250,000, that’s 11,200 fraudulent loans (toxic assets on the books).http://www.fdic.gov/bank/individual/failed/banklist.htmlhttp://www.digtriad.com/news/local_state/article.aspx?storyid=128864

WHY IS AMEICA’S HEARATLAND SO ANGRY? by Phillip ParhamWhy is America’s Heartland so furious and finally making their voices heard? Answering the question of who is the Heartland is required when addressing the current emotional response to government intervention.Heartland is defined as “the part of a region considered essential to the viability and survival of the whole, esp. a central land area relatively invulnerable to attack and capable of economic and political self-sufficiency” (dictionary.com). If we apply this definition and add the people who make this statement true, what do we have? We have the people who do the majority of the work, pay the lion’s share of taxes, and hold the core values spelled out in the founding documents. These are the people who still believe and hold dear, the truths found in the Declaration of Independence. “We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable rights, that among these are life, liberty and the pursuit of happiness. That to secure these rights, governments are instituted among men, deriving their just powers from the consent of the governed.That whenever any form of government becomes destructive to these ends, it is the right of the people to alter or to abolish it, and to institute new government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their safety and happiness” (Declaration of Independence). This is one small portion of this great document. In these turbulent times it is paramount, we the people, re-read and remind ourselves the values upon which our country was founded. The recognition of the raping of our founding principles, by the government, defines why I believe the voices heard today are the heartland of America.What are these people so furious about and why now? The answer is not simple, but a combination of past and present government usurpation of power and freedoms. Americans are finally waking from the trance they have been in for virtually two generations, beginning with President Wilson. The stupor was stripped away by the current administration of Obamatrons moving faster then any previous administrations. Previously administrations took small steps as they stole the rights laid out in the founding documents. They used “catastrophes and enemies” to orchestrate the theft of our freedom. By using these Americans believed it in their best interest to give up small freedoms for the greater good. Obama’s administration forgot, or simply ignored, the established method of usurping our freedoms and went straight at America. No longer content with the slow overthrow of our country they deemed this the time to go socialist.Angry, hell yes, and for good reason.The Heartland is now the enemy of the government. Janet Napolitano’s DHS listed America’s veterans as terrorists’ risks. The House of Representatives and Senate passed Cap and Trade legislation which will destroy businesses and productivity against the wishes of the people. America currently faces health care legislation which arguably will destroy the best health care system in the world. People read the bill even though Congress could not bother to do the same. The bill is so complicated, they tell us, and only lawyers can understand its complexities. Nancy Pelosi (Speaker of the House D) and Steny Hoyer (Majority Leader D) called citizens who protest Obamacare un-American. John Dingell (D-MI), “last seen being flummoxed by his own constituents last week. At the time, Dingell dismissed his critics as “infiltrators.” Today, they’re the equivalent of the Ku Klux Klan” (via The Weekly Standard): Arlen Spector (D) telling constituents he does not have to deign them with his presence to explain anything. Rep. David Scott (D) “shouting down a constituent, a doctor for daring to question him on healthcare in a public forum.” Rep Gabrielle Giffords (D) who refuses to hold town hall meeting with her constituents and admits her decision is final on healthcare. Why should she bother talking to voters? “Asked if she will have a town hall meeting in the county during this month’s congressional recess to specifically address rural health care, Giffords said no. If a town hall meeting were held, it would probably turn into an event where people would not want to listen,” she said (Sierra Vista Herald). Let’s not forget Obama promising Mexico on August 10, 2009 his next step is tackling immigration reform. Political doublespeak for amnesty to the millions of illegal aliens currently sucking billions out of the American economy and sending it to Mexico. He must repay the illegal vote for his elevation to supreme ruler. This is a sampling of an out of touch congress which deems the Heartland of America the enemy.The Heartland of America is furious and is finally finding its voice. It is time for the slumbering populace to wake up, read the founding documents, remind themselves of the truths of our country and fight this illegal usurpation of power by an out-of-control federal government. America is at a crossroads. Will the Heartland take back its country or is it destined for collapse? You decide.Phillip Parham is a retired US Army Sergeant Major. He has an MBA and is a Project Management Professional. Read his blog at usarmyguyretired.com. He and his family live in the southwest, where they strive for self-sufficiency.http://www.lewrockwell.com/orig10/parham1.1.1.html

I am a retired educator and I’m too old to take umbrage at the remarks of the critics of our education system. I take prune juice instead. To criticize our teachers without mentioning the home environment of the students or the lack of parental support for the educational process is not only unjust, it is inaccurate and useless with regard to any attempt at reform. Our school systems are a product of our society. The evils and ills of our society will always manifest themselves in our educational systems. If the Finnish had a society replete with all the social history and components that comprise the sociology of the United States, I don’t believe their record would be so exemplary. There is no free lunch when it comes to social injustice or having to pay the piper for centuries of racism and ethnic descrimination. The road to equality will be long and arduous. It will be frought with mistakes made with good and bad intentions, by people of good and bad will. Do you really believe it is an easy task to give a child in a single parent, poor urban household, the values necessary to delay gratification for future rewards? Do you really think a child who risks his or her life daily just leaving the home, can relax and concentrate on assimilating often tedious information necessary for success the next day in class? Do you believe a child can control the urge to assert him or herself when every one of their peers is constantly trying to gain advantage over them by putting them down whenever they can? Do you believe the reason for the high rate of recidivism at our state juvenile detention centers is because those kids come from an idyllic, drug free non- violent neighborhoods, or do you rather believe that African-Americans kids and Mexican-American kids are criminally insane and therefore incorrigible.If you believe the latter, then it is encumbent on you to first remove all the toxic environmental stimuli from these chidren’s environments so that you can then prove your argument. Until you do that, I’d like you to keep your big racist traps shut. I’d like you also to keep your remarks about the quality of our teachers to yourselves as well. As you can see, I took no umbrage. Now for some well deserved prune juice.

Wild Bill, you are a wonder. Bless you a thousand times.

Well put, WB.

Selections from REFLATION CONTEMPLATION by Doug Noland |PrudentBear.com Credit Bubble BulletinAugust 14, 2009Government Finance Bubble Watch:August 11 – Wall Street Journal: “Much to their dismay, Americans learned last year that they ‘owned’ Fannie Mae and Freddie Mac. Well, meet their cousin, Ginnie Mae or the Government National Mortgage Association, which will soon join them as a trillion-dollar packager of subprime mortgages. Taxpayers own Ginnie too. Only last week, Ginnie announced that it issued a monthly record of $43 billion in mortgage-backed securities in June. Ginnie Mae President Joseph Murin sounded almost giddy as he cheered this ‘phenomenal growth.’ Ginnie Mae’s mortgage exposure is expected to top $1 trillion by the end of next year—or far more than double the dollar amount of 2007… Ginnie’s mission is to bundle, guarantee and then sell mortgages insured by the Federal Housing Administration, which is Uncle Sam’s home mortgage shop. Ginnie’s growth is a by-product of the FHA’s spectacular growth. The FHA now insures $560 billion of mortgages—quadruple the amount in 2006. Among the FHA, Ginnie, Fannie and Freddie, nearly nine of every 10 new mortgages in America now carry a federal taxpayer guarantee.”Central Banker Watch:August 12 – Wall Street Journal (Lingling Wei and Jon Hilsenrath): “The Federal Reserve, with $900 million on the line, is getting actively involved in the biggest hotel bankruptcy, an awkward role for the central bank… On one hand, the Fed is clearly concerned that the bankruptcy of the 680-property Extended Stay Inc. chain has exposed major fault lines in the commercial real-estate market… On the other, the Fed’s role is tricky because it is facing off against financial firms it has to deal with in other rescue matters.”Fiscal Watch:August 12 – Bloomberg (Rebecca Christie): “The U.S. budget deficit reached a record for the first 10 months of the fiscal year and broke a monthly high for July… The shortfall so far for the fiscal year that ends Sept. 30 totaled $1.27 trillion compared with a $389 billion y-t-d gap in 2008… The excess of spending over revenue for July climbed to $180.7 billion… Spending for the month of July rose 26% from a year earlier to $332.2 billion, while revenue fell 6% to $151.5 billion… For the fiscal year that ends Sept. 30, the Office of Management and Budget forecasts the deficit will reach a record $1.841 trillion, more than four times the previous fiscal year’s $459 billion shortfall.”MBS/ABS/CDO/CP/Money Fund and Derivatives Watch:August 11 – Bloomberg (Dan Levy): “Almost one-quarter of U.S. mortgage holders owed more than their homes were worth in the second quarter and that figure may rise to as much as 30% by mid-2010 as job losses and foreclosures climb, Zillow.com said… ‘The negative-equity rate will rise and spin off more foreclosures,’ Stan Humphries, Zillow’s chief economist, said… ‘I see a substantial downside risk to prices and don’t think we’ll see a bottom until the middle of next year.’”Real Estate Bust Watch:August 13 – Bloomberg (Dan Levy): “Foreclosure filings in the U.S. climbed to a record for the third time in five months in July as falling home prices and the recession left more homeowners unable to keep up payments or refinance. A total of 360,149 properties received a default or auction notice or were seized last month, according to… RealtyTrac Inc. One in 355 households got a filing, the highest monthly rate in RealtyTrac records .dating to January 2005.Reflation Contemplation:Stock prices traditionally lead economic recoveries. Securities markets tend to react swiftly to loosened monetary conditions, while it takes some time for loose Credit to work its way through to the bowels of the real economy. Highly speculative markets react haphazardly, sloshing liquidity out and about. As is commonly understood, employment conditions are a somewhat lagging economic indicator. Most analysts have been content to read nothing of significance from ongoing poor jobs and housing data. Overwhelmingly, the bulls rely on faith – and history – that surging stock prices are discounting the usual “V” rebound.Data this week should have those of the bullish persuasion on edge. July retail sales were much weaker-than-expected (down 0.1% vs. expectations of a rise of 0.8%). Retail Sales excluding auto sales were down 0.6% for the month (down 8.1% y-o-y), the largest drop since March’s 1.1% fall. Looking back, there was no mystery surrounding first quarter consumer weakness. But even after a dramatic stock market recovery, July’s Department store sales were down a dismal 1.6% for the month (down 9.6% y-o-y). Even Wal-mart management commented that their customers were “selective” and remained keenly focused on value.Today’s preliminary report on August University of Michigan Consumer Confidence was also a big disappointment. The consensus called for this confidence reading to jump three points to 69. The actual report came in down to 63 – to the lowest level since those dark days of March. Readings on both “Economic Conditions” and “Economic Outlook” dropped to five-month lows.Yesterday, RealtyTrac reported that U.S. foreclosures jumped to a record 360,149 in July. This was up almost 7% from June and 32% higher than the year ago level. And there’s no relief in sight. American Bankruptcy Institute data had 126,000 Americans filing for bankruptcy in July, up 34% from a year earlier. It is now expected that 1.4 million will file for bankruptcy this year.Meanwhile, the economic optimists take comfort from this week’s readings on Non-farm Productivity, Wholesale Inventories, Industrial Production, and Capacity Utilization. Positive data out of Europe and Asia also seem to confirm that some type of global economic recovery has taken hold.From my perspective, this week’s data confirm important aspects of Credit Bubble analysis. First, ongoing headwinds will restrain rebounds in U.S. housing markets and household consumption – for an extended period. Second, the overall U.S. consumption-based economy will lag those of most of our more manufacturing-oriented trading partners. In short, we are witnessing anything but typical reflation dynamics, and those expecting a typical U.S. recovery will be disappointed. Our economy remains overly exposed to U.S. consumption, while having insufficient manufacturing capacity (and resources) of the type to benefit significantly from heightened global demand.Returning to the stock market, I see nothing typical going on there either. With the Morgan Stanley Retail Index and the Morgan Stanley Cyclical Index up 56% and 49%, respectively, the marketplace apparently has no issue with the recovery. I suspect these gains have been inflated by short covering. Indeed, market dynamics likely explain much of the divergence between ongoing weak underlying economic fundamentals and robust stock prices (especially in the consumer arena).Unusually large bearish hedges and bets had been placed against the (consumer-driven) U.S. economy. Unprecedented fiscal and monetary policy crisis response stabilized the Credit system, setting in motion a self-reinforcing unwind of “bearish” positions. In the past, such a reflationary dynamic would have seen stock prices for the most part accurately discount the future direction of economic activity. Stated differently, the reversal of bearish positions (and resulting short “squeeze”) would traditionally have (reflating) stock prices portending recovery and a return to the previous trajectory of economic performance. In general, a rejuvenated Credit system – and the resulting recovery of financial flows – would ensure that the “bear” case was proved wrong.This time may be different. I would not be surprised if the confluence of unusually large bearish positions, unprecedented policy response, and a resulting major “squeeze” created a backdrop where the stock market was turned into a rather poor foreteller of future prospects. From my vantage point, I certainly don’t believe stock prices today generally provide an accurate reflection of underlying company fundamentals. And from an economic perspective, I suspect the stock market is missing some key underlying dynamics that will shape future economic performance.In particular, equities seem to be discounting a return to business as usual when it comes to the U.S. economy. Retail and the “consumer discretionary” sectors have been among this year’s stellar performers. And, yes, this does fly in the face of my analysis of new economic realities and a permanently downsized role for household consumption in the U.S. economy. At this point, I view this as an anomaly at least partially explained by the hastened reversal of bearish positions. But I also recognize that massive fiscal and monetary stimulus has been implemented with the policy goal of sustaining the existing economic structure. The market has been content to play this dynamic expecting policymaker success.As I attempted to explain last week, I view the impairment of the stock market discounting mechanism as a key facet of Monetary Disorder. The reversal of bearish plays not only created huge buying power throughout the markets, it decisively reversed The Greed and Fear Factor. Notwithstanding today’s sell-off, the bulls are greedy and the bears are on the run. And the more that inflated stock prices entice shorting, the more games that can be played to “squeeze” the timid bears.The end result is a highly speculative stock market increasingly detached from reality and vulnerable to wild swings in sentiment. Yet I don’t expect the emerging global reflation to this time disprove the U.S. bearish thesis, although it will no doubt be a wild market ride.The bond market was happy with this week’s developments. The Fed confirmed it will be especially unhurried in raising rates and ending quantitative easing. Weak U.S. economic data was seen as confirming the bullish bond view. To be sure, low market yields at home and abroad are imperative for global reflation to gain a head of steam. And I would argue that (over-liquefied) bond markets are subject to their own pricing anomalies. In contrast to stocks, bonds have been fixated on U.S. economic vulnerabilities and the Fed, while content to downplay reflation risks. This week’s data doesn’t have me second-guessing the thesis of bond market vulnerability to global reflation dynamics. For bonds as well, the backdrop is set for a wild, speculative market ride.http://www.prudentbear.com/index.php/creditbubblebulletinview?art_id=10259

The BEST Summary W.B.Now go take that prune juice and keep up the good work .America Needs you badly…

Schiff to run for Dodd’s seat in 2010–Peter Schiff: Rising Stocks Not A Sign of Recovery | Digital JournalAugust 10, 2009 — Peter Schiff, President of Euro Pacific Capital and Author of Crash Proof, predicted this current economic collapse and is now saying that higher stocks does not meant recovery.The current rise in the stock market in the United States has ventured many analysts, including President Barack Obama, to declare that recession is nearing its end however; one man does not think it is coming to an end but just beginning.Peter Schiff told Money News Monday, “In fact, relative to the meteoric rise of foreign stock markets over the past six months, U.S. stocks are standing still. If anything, it is the strength in overseas markets that is dragging U.S. stocks along for the ride.”The Hang Seng Index has been rising dramatically since March with 10,000 points. German Dax has doubled since March. The Shanghai Composite Index has also doubled since February.For years now, Schiff has been investing abroad and moved out of the U.S. Dollar and the U.S. economy because of its “phony wealth” practice. Schiff called the recession two years before it was officially declared by the government.Schiff explained at goldseek.com that there is an unfathomable but widely held belief that stock market movements are indicators of present and future economic conditions, “Reality is clearly at odds with these optimistic assumptions. In the current cycle, neither the market nor its cheerleaders saw this recession coming, so why should anyone believe that these fonts of wisdom have suddenly become clairvoyant?”On Fox News, CNN, CNBC and other mainstream news networks, analysts laugh and scorned Schiff for his doom and gloom views on the American economy however, years later, he is right, “If they could not even forecast a recession that had already started, how can they possibly predict when it will end?”Analysts now state that the recession is coming to a halt and to be bullish on the economy, Schiff believes the worst is yet to come and that hyperinflation is the next major factor to draw concern for Americans.He has advised people to buy commodities, specifically gold and silver to protect against inflation, and invest abroad in places like China, Australia, Canada and Singapore and to buy Swiss Francs, Australian Dollars and Singapore Dollars.Peter Schiff will be running for Senator in the state of Connecticut against the current five-term Senator Chris Dodd in 2010.http://www.digitaljournal.com/article/277370

Well, it will certainly drive down your cash. Here are a few fees by states, with or without insurance, plus additional doctors’ fees. All need to be updated to 2009 charges:Arkansas Average Inpatient Charges – Top 30 hospital stays (pdf)Average charges (prices) per patient for the Top 30 hospitalizations (DRGs), such as newborn and maternity delivery, psychoses, rehabilitation, heart failure, pneumonia, COPD, digestive disorders, hip or knee replacement, chest pain, diabetes, stroke, hysterectomy (DRG 359), septicemia, Kidney failure, UTI, back problems and more. Overall, prices were over $18,000 per case ($3603 per day) in 2006. For reference, a normal delivery for mother & baby cost over $7400 ($4400 higher for C-Section without complications); a 12-day rehabilitation stay cost $19,600; hip or knee replacement averaged almost $34,000 (over $8600 per day); stent DRG 558 was $20,000 per day for $34,116 per case on average. Summer 2008 report by the Arkansas Hospital Association shows 2006 data.Florida – Average Charges for Inpatient Hospital Stays (Top 15 DRGs) (pdf)Average charges (price) & Length of Stay for top 15 types of hospital stays, such as childbirth (vaginal delivery without complicating diagnoses was $8708 plus newborn charges of about $2100) and Cesarean section; psychoses; heart failure, chest pain; joint replacement (e.g. hip and knee) surgery [average nearly $52,000], COPD, pneumonia, GI problems, stroke, kidney failure, septicemia and GI hemorrhage. While the top 15 averaged $17,925 per case, the average charge when all of Florida’s 2.6 million cases were examined was $31,218. Report by the Florida Hospital Association; 2007 data found on page 3. Updated 2008Sepsis in Nevada – 2001-2005 (pdf)Nevada’s Center for Health Data and Research summary report on Septicemia, sepsis and septic shock – showing a staggering average price of $118,494 in 2005 and over two weeks’ stay in the hospital. Babies under one year accounted for 18% of cases. Mortality rate was 24%; in 2005, septicemia was Nevada’s ninth leading cause of death. February 2007 report geared to administrators and leaders.http://www.consumerhealthratings.com/index.php?action=search&keywords=septicemia

Well, Consumers are not holding odd CASH FOR CLUNKER (car or home) big purchase. it is not because consumers are out of money, look at all the money on sideline, they are all looking for a killing in purchase like CASH FOR CLUNKER. situation is not all dark like you described.

and …uncontroversial and universally accepted. It describes the effect from the pointof view of the creditor. Yet people find it hard to comprehend the equivalentproposition describing the very same effect from the point of view of the debtor,namely, that the liquidation value of debt varies inversely with the rate ofinterest, in particular, lowering the rate of interest will increase the liquidationvalue of debt. There is no difference between the meanings of the twostatements. The bond price is just the liquidation value of debt evidenced by thebond. Falling interest rates make the burden of debt increase.The depreciation quota of a producer good is an accounting tool revealinghow much of its value is being ‘used up’, and needs to be replaced throughamortization, in any particular year. It is comparable to the annual yield ofcapital invested in a bond. When looked at in this way, it becomes clear thatfalling interest rates should make the revision of depreciation quotas upwardsmandatory. If this rule is ignored, there will be a shortfall in amortization.Sufficient funds will not have been set aside to pay for the purchase of thereplacement at the end of the useful life of producer goods.Present accounting standards ignore both effects (i) and (ii). This is thecause of concealed capital erosion acting insidiously. Losses are masked asprofits, and phantom profits are paid out as dividends and managerialcompensation. The process of capital erosion is accelerated. Inevitably, theresult is deflation, depression, or worse.

Never miss a chance to listen to Steve Keenhttp://www.themonthly.com.au/new-times-new-approaches-steve-keen-australias-economic-prospects-p3-1894

30-year bonds and hedging inflation risk through the CDS market…YIKES!

A 90% population reduction would solve a lot of problems. Then maybe we evolve some more.

get rid of lousy teachers that have tenure, then I will listen to you…..

gigolo is that you again?

That there are bad teachers with tenure is undeniable. I know this to be a fact because as a union official, I was called upon to defend them. I would have loved to get rid of them.That there are bad cops is undeniable. The PBA defends them and many get to keep there jobs in spite of their infractions or shortcomings.That there are bad lawyers is undeniable. The Bar Association does not have the will or the where-with-all to get rid of them.That there are bad doctors is undeniable. The A.M.A. may sanction them or slap them on the wrist, but most of them are still practicing.That there are bad politicians is undeniable. etc. etc.That there are bad bankers is undeniable. etc. etc. etc.The validity of my arguments is not predicated on the existence or not of lousey teachers. One can argue for reform and against hate-filled, ignorant criticisms even if bad teachers are present, just as we can reform our health care system even if there are some bad doctors. The same is true for lawyers, law enforcement, banking, politics etc.Rather than holding to a rigid prerequisite before objectively investigating the complex causes of educational underperformance, fling that prerequisite far away from you. It is blinding you and preventing you from seeing the profound and complex web of inhumanity that is at the root of the problems we are talking about.There is no good reason to hang on to your conditional attitude before you will “listen to me”, unless you are using it as a shield so you don’t have to confront the truth and all the accountability that may go with it.

You don’t get it. Unreal.

Ron Paul is comfortable with people starving in the streets? Don’t get your own moniker, Guest; you’re so nuts, you’ll be ignored instantly.

Just listen to MOG and you’ll know everything about everything because “NATURE” has revealed all knowledge to MOG.

I been reading your comments for quite a while now…and I think I finally get it. Are you saying there are no jobs?

MOG……….pay justice does not cause happiness.

Human conflict arises neither from political, nor social, nor economic injustice. It arises from the human heart.

How about this proposition?The history of the every nation/people is the history of their unique reaction to God’s plan for this universe as revealed in the Bible and through the life, death and resurrection of His son Jesus Christ.America a Christian nation…….well, maybe, at least in part. I have to agree that America’s success as a nation is/has always been determined in direct proportion to the faith Americans have shown.

clever ideas! The sad part is that the wealthy are too selfish to ever consider them and the middle class and poor are too weak to do anything about it.