This video helps explains the ramification....
Saturday, August 28, 2010
Feds Attack An American Hero
What do the Feds think that they are trying to do? The sheriff is just following Federal Laws and the laws of his state.
"Sheriff Joe Arpaio, the Maricopa County, Arizona, man who calls himself “America’s toughest sheriff,” has until Sept. 10 to comply with a Justice Department request to explain his office’s “operations, policies and procedures” involving the arrest and detention of Hispanics, according to a letter obtained by ABC News."
I hope he explains that he is just following the rules of our Country...that it is illegal to enter our country without the propper documents according to FEDERAL LAWS. What do they not understand?
“I now know after the meeting that they involve Hispanics, but they refuse to provide any specific allegations,” said Driscoll [Sheriff's Office attorney]. “This case is pretty unusual, I think. They don’t seem to have any evidence. They already have in their possession reams and reams and reams of materials on what we would speculate is the thrust of their investigation,” he added."
The "Department=(Feds)" seem to be trying to find something they can pinpoint and prosecute.
"The Department is conducting the civil rights investigation under a federal provision that permits the government to scrutinize state agencies that receive federal funding. If the agency is deemed to have engaged in discriminatory behavior it could risk losing federal grants."
Another reason NOT to take Federal monies....let's watch where this goes!
What do the Feds think that they are trying to do? The sheriff is just following Federal Laws and the laws of his state.
"Sheriff Joe Arpaio, the Maricopa County, Arizona, man who calls himself “America’s toughest sheriff,” has until Sept. 10 to comply with a Justice Department request to explain his office’s “operations, policies and procedures” involving the arrest and detention of Hispanics, according to a letter obtained by ABC News."
I hope he explains that he is just following the rules of our Country...that it is illegal to enter our country without the propper documents according to FEDERAL LAWS. What do they not understand?
“I now know after the meeting that they involve Hispanics, but they refuse to provide any specific allegations,” said Driscoll [Sheriff's Office attorney]. “This case is pretty unusual, I think. They don’t seem to have any evidence. They already have in their possession reams and reams and reams of materials on what we would speculate is the thrust of their investigation,” he added."
The "Department=(Feds)" seem to be trying to find something they can pinpoint and prosecute.
"The Department is conducting the civil rights investigation under a federal provision that permits the government to scrutinize state agencies that receive federal funding. If the agency is deemed to have engaged in discriminatory behavior it could risk losing federal grants."
Another reason NOT to take Federal monies....let's watch where this goes!
Wednesday, August 25, 2010
DOW to 5000...Is It Coming?
Charles Nenner thinks the DOW will decline to 5000 over the next two years.
Keep your eyes open and be prepared for this.
Keep your eyes open and be prepared for this.
Friday, August 13, 2010
Are We In A Financial Freefall?
http://www.moneyandmarkets.com/
Here are six reasons for a double-dip recession I extracted from the article.
First, the economic rebound since March 2009 was bought with unprecedented fiscal and monetary stimulus. There has not been a real, market-generated recovery.
Second, despite the huge sums of taxpayer money and serial bailouts, the rebound is the weakest on record.
Third, at least 80 percent of this huge stimulus program has been used up. There isn’t much left to keep the economic engines running.
Fourth, aside from government debt, the wheels of credit creation are still sputtering. And that’s a problem, since former recoveries have always been driven by credit growth.
Fifth, the labor market is still in dire straits — and so is consumer spending. Friday’s disappointing payroll report is a very strong hint that the labor market is again deteriorating.
Following the ECRI data, this is not surprising. Historically, there has been a strong correlation between the ECRI weekly index and payroll numbers. Furthermore, I expect much weaker employment reports in the weeks and months to come.
Sixth, the housing mess has not been cleaned up yet. I expect another huge wave of mortgage debt defaults, leading to another round of falling home prices and problems for the banking sector.
All in all, the big economic picture is pretty grim. Indeed, the economy is at a crossroads here. Unfortunately, though, it seems to be heading down the recession path again.
Here are six reasons for a double-dip recession I extracted from the article.
First, the economic rebound since March 2009 was bought with unprecedented fiscal and monetary stimulus. There has not been a real, market-generated recovery.
Second, despite the huge sums of taxpayer money and serial bailouts, the rebound is the weakest on record.
Third, at least 80 percent of this huge stimulus program has been used up. There isn’t much left to keep the economic engines running.
Fourth, aside from government debt, the wheels of credit creation are still sputtering. And that’s a problem, since former recoveries have always been driven by credit growth.
Fifth, the labor market is still in dire straits — and so is consumer spending. Friday’s disappointing payroll report is a very strong hint that the labor market is again deteriorating.
Following the ECRI data, this is not surprising. Historically, there has been a strong correlation between the ECRI weekly index and payroll numbers. Furthermore, I expect much weaker employment reports in the weeks and months to come.
Sixth, the housing mess has not been cleaned up yet. I expect another huge wave of mortgage debt defaults, leading to another round of falling home prices and problems for the banking sector.
All in all, the big economic picture is pretty grim. Indeed, the economy is at a crossroads here. Unfortunately, though, it seems to be heading down the recession path again.
Is an economic collapse in Americas future?
By Keith R. McCullough, contributorAugust 11, 2010: 2:07 PM ET
FORTUNE -- The Great Depression. Wall Street in 1987. Japan in 1997. Points of economic collapse are generally crystal clear in the rear-view mirror. Professional politicians in Japan have been telling stories for 20 years as to why they can prevent economic stagnation. In the US, the storytelling started in 2007. All the while, stock market and real-estate prices have repeatedly rallied to lower-highs, then collapsed again, to lower-lows.
Despite the many differences between Japan and the US, there is one similarity that continues to matter most in the risk management model my colleagues and I use at Hedgeye, our research firm -- debt as a percentage of GDP. Now that the US can't cut interest rates any lower, the only option left on the table is what the Fed just announced it would start doing -- buying Treasury debt. And that could lead the country to the brink of collapse: According to economists Carmen Reinhart & Ken Rogoff, whose views we share, crossing the 90% debt/GDP threshold is the equivalent of crossing the proverbial Rubicon of economic growth. It's a point from which it's almost impossible to return.
July 2nd, we cut both our third quarter 2010 and full year 2011 GDP estimates for the US to 1.7%. At the time, the consensus around US economic growth estimates was about 3%. Now we're starting to see both big brokerage analysts and the Federal Reserve gradually cut their GDP estimates, but not by enough. Even our estimate for 2011 is still too high.
Slowing growth, both domestically and in China, is core to our bearish views on both the strength of the US dollar and US equities. There will be a downward bias to our US growth estimates as long as debt-financed-deficit-spending continues to be the solution politicians and central bankers turn to as a fix to our financial crisis.
Markets trade on expectations. Yesterday's zig-zag in the S&P 500 was unlike most sleepy August trading days in America. That's because the 'government is good' crowd leaked word that this second round of "quantitative easing," known as QE2, was coming, and that Ben Bernanke was going to respond to our buy-and-hope begging. (The first round of quantitative easing was the Fed's unprecedented purchase of agency debt to prop up the housing market, along with credit facilities for big banks, which began in 2008 and ended earlier this year.)
To think that we have institutionalized market expectations to this degree is downright frightening. It seems impossible but true that all rallies start and end with rumors about what Fed Chairman Ben Bernanke, a humble looking man of government, had to say at 2:15 PM EST yesterday afternoon, or any other day he makes a statement.
So now what?
With 40.8 million Americans on food stamps (record high) and 45% of the unemployed having been seeking employment for 27 weeks or more (record high), what's left if (or when) QE2 doesn't kick start GDP growth? Should we start begging for QE3? Should we cancel the bomb of the National Association of Realtors' existing home sales report, scheduled for public release on August 24th? Or should we bite the bullet and accept that current economic policy dictates 0% returns-on-savings, even as Washington continues to lever-up our future to the point of economic collapse?
Before the Fiat Fools -- Hedgeye's name for political actors and bankers who have placed their hopes of economic recovery in printing endless supplies of new cash -- run out campaigning for QE3, maybe they should analyze some real time market results to yesterday's announcement of QE2:
1)The US dollar is battling for resuscitation after 9 consecutive down weeks -- down 9% since June.
2) US Treasury yields are making record lows on the short end of the curve, with 2-year yields striking 0.49%.
3) The yield spread (in this case the difference in return between 10-year and 2-year Treasury bills, which shows a long-term confidence when high) continues to collapse, down another 4 basis point day-over-day to 223 basis points.
4) The S&P 500 is down below its 200-day moving average (a common signpost for the health of a market or stock) of 1115.
5) US Volatility (VIX) is spiking from its recent stability.
6) In Japan, long time quantitative easing specialists found their markets closing down overnight by 2.7%, which makes them down 11.9% for the year to date.
Lest our doom and gloom seem built entirely on technical measurements, what they boil down to is actually quite simple -- an idea about our country which dates back to 1835. Alexis De Tocqueville, author of Democracy in America, which was published that year, seemed to warn of this day when he wrote: "The American Republic will endure until the day Congress discovers that it can bribe the public with the public's money."
-- Keith R. McCullough is CEO of Hedgeye, a research firm based in New Haven, Conn.
By Keith R. McCullough, contributorAugust 11, 2010: 2:07 PM ET
FORTUNE -- The Great Depression. Wall Street in 1987. Japan in 1997. Points of economic collapse are generally crystal clear in the rear-view mirror. Professional politicians in Japan have been telling stories for 20 years as to why they can prevent economic stagnation. In the US, the storytelling started in 2007. All the while, stock market and real-estate prices have repeatedly rallied to lower-highs, then collapsed again, to lower-lows.
Despite the many differences between Japan and the US, there is one similarity that continues to matter most in the risk management model my colleagues and I use at Hedgeye, our research firm -- debt as a percentage of GDP. Now that the US can't cut interest rates any lower, the only option left on the table is what the Fed just announced it would start doing -- buying Treasury debt. And that could lead the country to the brink of collapse: According to economists Carmen Reinhart & Ken Rogoff, whose views we share, crossing the 90% debt/GDP threshold is the equivalent of crossing the proverbial Rubicon of economic growth. It's a point from which it's almost impossible to return.
July 2nd, we cut both our third quarter 2010 and full year 2011 GDP estimates for the US to 1.7%. At the time, the consensus around US economic growth estimates was about 3%. Now we're starting to see both big brokerage analysts and the Federal Reserve gradually cut their GDP estimates, but not by enough. Even our estimate for 2011 is still too high.
Slowing growth, both domestically and in China, is core to our bearish views on both the strength of the US dollar and US equities. There will be a downward bias to our US growth estimates as long as debt-financed-deficit-spending continues to be the solution politicians and central bankers turn to as a fix to our financial crisis.
Markets trade on expectations. Yesterday's zig-zag in the S&P 500 was unlike most sleepy August trading days in America. That's because the 'government is good' crowd leaked word that this second round of "quantitative easing," known as QE2, was coming, and that Ben Bernanke was going to respond to our buy-and-hope begging. (The first round of quantitative easing was the Fed's unprecedented purchase of agency debt to prop up the housing market, along with credit facilities for big banks, which began in 2008 and ended earlier this year.)
To think that we have institutionalized market expectations to this degree is downright frightening. It seems impossible but true that all rallies start and end with rumors about what Fed Chairman Ben Bernanke, a humble looking man of government, had to say at 2:15 PM EST yesterday afternoon, or any other day he makes a statement.
So now what?
With 40.8 million Americans on food stamps (record high) and 45% of the unemployed having been seeking employment for 27 weeks or more (record high), what's left if (or when) QE2 doesn't kick start GDP growth? Should we start begging for QE3? Should we cancel the bomb of the National Association of Realtors' existing home sales report, scheduled for public release on August 24th? Or should we bite the bullet and accept that current economic policy dictates 0% returns-on-savings, even as Washington continues to lever-up our future to the point of economic collapse?
Before the Fiat Fools -- Hedgeye's name for political actors and bankers who have placed their hopes of economic recovery in printing endless supplies of new cash -- run out campaigning for QE3, maybe they should analyze some real time market results to yesterday's announcement of QE2:
1)The US dollar is battling for resuscitation after 9 consecutive down weeks -- down 9% since June.
2) US Treasury yields are making record lows on the short end of the curve, with 2-year yields striking 0.49%.
3) The yield spread (in this case the difference in return between 10-year and 2-year Treasury bills, which shows a long-term confidence when high) continues to collapse, down another 4 basis point day-over-day to 223 basis points.
4) The S&P 500 is down below its 200-day moving average (a common signpost for the health of a market or stock) of 1115.
5) US Volatility (VIX) is spiking from its recent stability.
6) In Japan, long time quantitative easing specialists found their markets closing down overnight by 2.7%, which makes them down 11.9% for the year to date.
Lest our doom and gloom seem built entirely on technical measurements, what they boil down to is actually quite simple -- an idea about our country which dates back to 1835. Alexis De Tocqueville, author of Democracy in America, which was published that year, seemed to warn of this day when he wrote: "The American Republic will endure until the day Congress discovers that it can bribe the public with the public's money."
-- Keith R. McCullough is CEO of Hedgeye, a research firm based in New Haven, Conn.
Transparency at The White House....Not So Much
Transparency, well not so much!!!
Timothy P. Carney: Obama closes curtain on transparency
By: Timothy P. Carney
Examiner Columnist
August 12, 2010 President Obama has abolished the position in his White House dedicated to transparency and shunted those duties into the portfolio of a partisan ex-lobbyist who is openly antagonistic to the notion of disclosure by government and politicians.
Obama transferred "ethics czar" Norm Eisen to the Czech Republic to serve as U.S. ambassador. Some of Eisen's duties will be handed to Domestic Policy Council member Steven Croley, but most of them, it appears, will shift over to the already-full docket of White House Counsel Bob Bauer.
Bauer is renowned as a "lawyer's lawyer" and a legal expert. His resume, however, reads more "partisan advocate" than "good-government crusader." Bauer came to the White House from the law firm Perkins Coie, where he represented John Kerry in 2004 and Obama during his campaign.
Bauer has served as the top lawyer for the Democratic National Committee, which is the most prolific fundraising entity in the country. Then-Rep. Rahm Emanuel, D-Ill., the caricature of a cutthroat Chicago political fixer, hired Bauer to represent the Democratic Congressional Campaign Committee. In the White House, Bauer is tight with Emanuel, having defended Emanuel's offer of a job to Rep. Joe Sestak, D-Pa., whom Emanuel wanted out of the Senate race.
Another Bauer client was New Jersey Sen. Robert "Torch" Torricelli back in 2001. When one Torricelli donor admitted he had reimbursed employees for their contributions to the Torch -- thus circumventing contribution limits -- Bauer explained, "All candidates ask their supporters to help raise money from friends, family members and professional associates."
Bauer's own words -- gathered by the diligent folks at the Sunlight Foundation -- show disdain for openness and far greater belief in the good intentions of those in power than of those trying to check the powerful. In December 2006, when the Federal Election Commission proposed more precise disclosure requirements for parties, Bauer took aim at the practice of muckraking enabled by such disclosure.
On his blog, Bauer derided the notion "that politicians and parties are pictured as forever trying to get away with something," saying this was an idea for which "there is a market, its product cheaply manufactured and cheaply sold." In other words -- we keep too close an eye on our leaders.
In August 2006 Bauer blogged, "disclosure is a mostly unquestioned virtue deserving to be questioned." This is the man the White House has put in charge of making this the most open White House ever.
Most telling might have been Bauer's statements about proposed regulations of 527 organizations: "If it's not done with 527 activity as we have seen, it will be done in other ways," he told the Senate rules committee.
"There are other directions, to be sure, that people are actively considering as we speak. Without tipping my hand or those of others who are professionally creative, the money will find an outlet."
This perfectly captures the Obama White House's attitude toward disclosure. Sure, the administration publish the names of all White House visitors, but, as the New York Times reported a few weeks back, White House folks just meet their lobbyists at Caribou Coffee across the street. Sure, they restrict the work of ex-lobbyists in the administration, but lobbyists who de-list aren't questioned.
And we've seen just a few of the e-mails former Google lobbyist, now Obama tech policy guru, Andrew McLaughlin traded with current Google lobbyists using his Gmail account, but who knows what else the White House whiz kids are doing to avoid the Presidential Records Act -- Facebook messages? Twitter direct messages?
Did I mention Bauer was a lobbyist? At Perkins Coie, Bauer lobbied on behalf of America Votes Inc., a Democratic 527 funded by the likes of the AFL-CIO and ACORN.
The Sunlight Foundation is also concerned about the fact the White House no longer has anyone whose job is transparency, as Eisen's job was. John Wonderlich, at SunglightFoundation.com, lists a few transparency promises on which the president hasn't followed through, including earmark transparency, a single Web site (Ethics.gov) with all ethics and accountability information, and better lobbying disclosure, among others.
As with his other reformer rhetoric, Obama's transparency is mostly smoke and mirrors.
Timothy P. Carney is The Washington Examiner's lobbying editor. His K Street column appears on Wednesdays.
Timothy P. Carney: Obama closes curtain on transparency
By: Timothy P. Carney
Examiner Columnist
August 12, 2010 President Obama has abolished the position in his White House dedicated to transparency and shunted those duties into the portfolio of a partisan ex-lobbyist who is openly antagonistic to the notion of disclosure by government and politicians.
Obama transferred "ethics czar" Norm Eisen to the Czech Republic to serve as U.S. ambassador. Some of Eisen's duties will be handed to Domestic Policy Council member Steven Croley, but most of them, it appears, will shift over to the already-full docket of White House Counsel Bob Bauer.
Bauer is renowned as a "lawyer's lawyer" and a legal expert. His resume, however, reads more "partisan advocate" than "good-government crusader." Bauer came to the White House from the law firm Perkins Coie, where he represented John Kerry in 2004 and Obama during his campaign.
Bauer has served as the top lawyer for the Democratic National Committee, which is the most prolific fundraising entity in the country. Then-Rep. Rahm Emanuel, D-Ill., the caricature of a cutthroat Chicago political fixer, hired Bauer to represent the Democratic Congressional Campaign Committee. In the White House, Bauer is tight with Emanuel, having defended Emanuel's offer of a job to Rep. Joe Sestak, D-Pa., whom Emanuel wanted out of the Senate race.
Another Bauer client was New Jersey Sen. Robert "Torch" Torricelli back in 2001. When one Torricelli donor admitted he had reimbursed employees for their contributions to the Torch -- thus circumventing contribution limits -- Bauer explained, "All candidates ask their supporters to help raise money from friends, family members and professional associates."
Bauer's own words -- gathered by the diligent folks at the Sunlight Foundation -- show disdain for openness and far greater belief in the good intentions of those in power than of those trying to check the powerful. In December 2006, when the Federal Election Commission proposed more precise disclosure requirements for parties, Bauer took aim at the practice of muckraking enabled by such disclosure.
On his blog, Bauer derided the notion "that politicians and parties are pictured as forever trying to get away with something," saying this was an idea for which "there is a market, its product cheaply manufactured and cheaply sold." In other words -- we keep too close an eye on our leaders.
In August 2006 Bauer blogged, "disclosure is a mostly unquestioned virtue deserving to be questioned." This is the man the White House has put in charge of making this the most open White House ever.
Most telling might have been Bauer's statements about proposed regulations of 527 organizations: "If it's not done with 527 activity as we have seen, it will be done in other ways," he told the Senate rules committee.
"There are other directions, to be sure, that people are actively considering as we speak. Without tipping my hand or those of others who are professionally creative, the money will find an outlet."
This perfectly captures the Obama White House's attitude toward disclosure. Sure, the administration publish the names of all White House visitors, but, as the New York Times reported a few weeks back, White House folks just meet their lobbyists at Caribou Coffee across the street. Sure, they restrict the work of ex-lobbyists in the administration, but lobbyists who de-list aren't questioned.
And we've seen just a few of the e-mails former Google lobbyist, now Obama tech policy guru, Andrew McLaughlin traded with current Google lobbyists using his Gmail account, but who knows what else the White House whiz kids are doing to avoid the Presidential Records Act -- Facebook messages? Twitter direct messages?
Did I mention Bauer was a lobbyist? At Perkins Coie, Bauer lobbied on behalf of America Votes Inc., a Democratic 527 funded by the likes of the AFL-CIO and ACORN.
The Sunlight Foundation is also concerned about the fact the White House no longer has anyone whose job is transparency, as Eisen's job was. John Wonderlich, at SunglightFoundation.com, lists a few transparency promises on which the president hasn't followed through, including earmark transparency, a single Web site (Ethics.gov) with all ethics and accountability information, and better lobbying disclosure, among others.
As with his other reformer rhetoric, Obama's transparency is mostly smoke and mirrors.
Timothy P. Carney is The Washington Examiner's lobbying editor. His K Street column appears on Wednesdays.
Monetizing The Debt
Have you been wondering what monetizing the debt means. Well, I could explain it in writing, but this video does such a good job. Take two minutes and view it. It will open your eyes to what is happening in America.
Survival and Prepardness Forum
Sorry that I have been absent, but I have been busy at survivalandpreparednessforum . If you have not visited this site, I would encourage you to do so. I have made many posts there regarding medicine, economy, unemployement and illegals. There is a lot of info there regarding many different subjects. Check it out, join and get involved.
Wednesday, July 28, 2010
What Big Ben Did NOT Tell CONgress
In his testimony before Congress last week, there wer some things that Ben Bernanke did not say.
There were things he did not discuss and some things he did not truely explain. Why? Why is the economy still in a decline? There are four BOMBSHELLS that need to be discussed and Martin Weiss did so in the above article. Here are some excerpts.
FIRST and foremost, what's CAUSING the economy to sink? The stock market has not yet crashed. Interest rates have not yet surged. Gasoline prices have not skyrocketed. There has been no recent debt collapse, market shock, or terrorist attack.
So what is the invisible force that's suddenly gutting the housing market, driving consumer confidence into a sinkhole, and killing the recovery that Washington was so avidly touting just a few months ago?
Bernanke won't say. But the answer is clear: The recovery had very little substance to begin with. Rather, it was, in essence, a mirage — a dead cat bounce bought and paid for by Washington's massive bailouts, stimulus programs, and money printing.
Put another way, the recession never really ended.
SECOND, Bernanke failed to point how that ...
The U.S. Housing Market Is Now LOCKED Into a Chronic, Long-Term Depression
Housing starts — the most important measure of the housing industry — is still a disaster zone.
Beginning in January 2006, they suffered their worst plunge in recorded history — from an annual rate of 2.3 million to a meager 477,000 in April 2009. Thus ...
In just three years, 79 percent of America's largest industry, impacting more Americans than any other, was wiped away.
Then, despite a series of government agency programs to shore up the industry ... plus $1.25 trillion poured in by the Fed to buy up mortgage-backed securities ... plus a big tax credit for new homebuyers, housing starts perked up ever so slightly: They recovered to an annual rate of 612,000 in January of this year.
But this recovery was so small, it retraced just 7.5 percent of the prior fall. In other words, even after massive government efforts, and even at the highest point in their recovery this year, the housing industry recouped less than one-tenth of its historic three-year bust from 2006 to 2009.
Worse, the housing industry has now resumed its decline.
The most alarming factor: Widespread "strategic defaults" on home mortgages. These are defaults by homeowners who can afford to meet their monthly mortgage payments, but have deliberately decided to stop paying.
They realize their home is worth less than they owe on the mortgage — transforming it into a dead asset they're willing to give up. They know their bank, already overwhelmed with foreclosures, won't get around to evicting them for as long as two years, allowing them to live in the house cost-free. They also know this tactic can give them tens of thousands of dollars in extra cash. So they're defaulting en masse and getting away with it.
End result:
New supplies of foreclosed homes hitting the market as far as the eye can see ...
Bankers who would rather cut their wrists than finance new homes, and ...
A new slump in housing that's worse than even some pessimists were expecting.
THIRD, despite his now-famous quote that this is "the worst labor market since the Great Depression," Bernanke failed to reveal that ...
Official Government Data GROSSLY Understates the Magnitude of Unemployment
Bernanke did not mention that the percentage of long-term unemployed in America is the worst it's been since the government began keeping records in 1948. Two facts:
Fact #1: A record 4.39 percent of the work force — or 46.2 percent of the unemployed — have been out of work for 27 weeks or more. That's DOUBLE the worst level ever recorded and TRIPLE the peak level seen in five of the past six recessions.
Fact #2: On average, America's unemployed have been out of work for 35.2 weeks, also the highest on record.
Bernanke did not remind Congress that, based on the government's own broad measure, the true unemployment rate in the U.S. is not 9.5 percent. It's 16.5 percent — or seven full percentage points more than the figure Mr. Bernanke likes to refer to.
This broader measure includes workers seeking full-time employment, but temporarily settling for lower paying part-time jobs. Plus, it's supposed to also include "discouraged workers" — those who have given up looking for work because there are no jobs to be found.
Nor did Bernanke confess that, during the Clinton administration, discouraged workers were "redefined" to EXCLUDE those who had been out of work for more than a year — and that definition continues to be used to this day.
That makes absolutely no sense. If they're out of work for a year, they're discouraged. But as soon as they're out of work for a year and one day, it's suddenly assumed they're happily going about their life?!
Thus, precisely when economists now recognize that one of the biggest challenges of this Great Recession is long-term unemployment ... the Obama administration, both parties in Congress, and all U.S. government agencies continue to exclude the longest term unemployed from every single one of their unemployment statistics.
This could go down in history as one of the greatest deceptions about the true state of U.S. labor markets. And according to John Williams of Shadow Government Statistics, it's big:
When you add these long-term discouraged workers back into the jobless count, you find that the real unemployment rate in the U.S. is actually 21.6 percent!
FOURTH, Bernanke failed to point out that all this is happening despite ...
The Biggest Government Interventions of ALL TIME!
The full scope of the government's interventions is now official:
In its July 21 Quarterly Report to Congress, the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) tabulates the government's bailouts, stimulus programs, and money printing escapades since the debt crisis struck in 2007, as follows:
According to SIGTARP, at mid-year 2010,
The Fed has pumped in $1.7 trillion through its massive purchases of mortgage bonds, Treasury bonds, and agency bonds.
The FDIC has thrown another $300 billion into the pot, shutting down over 100 banks so far this year.
The Treasury has pumped in a net of $300 billion in TARP money (even after paybacks), plus another $500 billion in money outside of the TARP program.
Plus, several other government agencies have chipped in another $800 billion.
These official numbers are actually LARGER than we were estimating. We had the total pegged at $3.5 trillion (not billion), including the 2009 stimulus package.
SIGTARP has it at $3.7 trillion, excluding the stimulus but including a myriad other rescue programs — by the Federal Housing Finance Agency (FHFA), the National Credit Union Administration (NCUA), the Government National Mortgage Association (GNMA), the Federal Housing Administration (FHA), and the Veterans Affair (VA).
But no matter how you count it, some outstanding facts are absolutely self-evident:
FACT: The enormous magnitude of the government's intervention FAR surpasses anything ever witnessed in the history of humankind.
FACT: It's not working! Housing is still collapsed. Long-term unemployment is the worst ever recorded. And the recovery, already anemic, is aborting prematurely.
FACT: Most important, it's winding down! Through mid-2009, the government intervention programs tabulated by SIGTARP were being ramped up at a furious pace — a total of $3 trillion overall.
So over the 12-month period from mid-2008 through mid-2009, we estimate they were running at the average monthly pace of about $160 billion. But since mid-2009, they have been far slower, running at an average monthly pace of only $58 billion, or just one-third the prior level. And right now, the pace of new funds injected into the economy through these government rescues are merely a trickle compared to their earlier rate:
**No new stimulus is in the works.
**No new TARP funds are forthcoming.
**The Fed has wrapped up its bond buying splurge.
**And the ONLY significant continuing programs are for housing — the one area where the government has admittedly seen the WORST overall results, according to SIGTARP.
Bottom line:
If you were counting on the government to prevent the second major leg in this great double-dip recession, don't hold your breath. To the contrary, the primary CAUSE of the second dip is the government's conspicuous absence from sectors where it was, until now, the biggest mover, shaker, buyer, and financier.
Keep your eyes open and prepare for the future.
There were things he did not discuss and some things he did not truely explain. Why? Why is the economy still in a decline? There are four BOMBSHELLS that need to be discussed and Martin Weiss did so in the above article. Here are some excerpts.
FIRST and foremost, what's CAUSING the economy to sink? The stock market has not yet crashed. Interest rates have not yet surged. Gasoline prices have not skyrocketed. There has been no recent debt collapse, market shock, or terrorist attack.
So what is the invisible force that's suddenly gutting the housing market, driving consumer confidence into a sinkhole, and killing the recovery that Washington was so avidly touting just a few months ago?
Bernanke won't say. But the answer is clear: The recovery had very little substance to begin with. Rather, it was, in essence, a mirage — a dead cat bounce bought and paid for by Washington's massive bailouts, stimulus programs, and money printing.
Put another way, the recession never really ended.
SECOND, Bernanke failed to point how that ...
The U.S. Housing Market Is Now LOCKED Into a Chronic, Long-Term Depression
Housing starts — the most important measure of the housing industry — is still a disaster zone.
Beginning in January 2006, they suffered their worst plunge in recorded history — from an annual rate of 2.3 million to a meager 477,000 in April 2009. Thus ...
In just three years, 79 percent of America's largest industry, impacting more Americans than any other, was wiped away.
Then, despite a series of government agency programs to shore up the industry ... plus $1.25 trillion poured in by the Fed to buy up mortgage-backed securities ... plus a big tax credit for new homebuyers, housing starts perked up ever so slightly: They recovered to an annual rate of 612,000 in January of this year.
But this recovery was so small, it retraced just 7.5 percent of the prior fall. In other words, even after massive government efforts, and even at the highest point in their recovery this year, the housing industry recouped less than one-tenth of its historic three-year bust from 2006 to 2009.
Worse, the housing industry has now resumed its decline.
The most alarming factor: Widespread "strategic defaults" on home mortgages. These are defaults by homeowners who can afford to meet their monthly mortgage payments, but have deliberately decided to stop paying.
They realize their home is worth less than they owe on the mortgage — transforming it into a dead asset they're willing to give up. They know their bank, already overwhelmed with foreclosures, won't get around to evicting them for as long as two years, allowing them to live in the house cost-free. They also know this tactic can give them tens of thousands of dollars in extra cash. So they're defaulting en masse and getting away with it.
End result:
New supplies of foreclosed homes hitting the market as far as the eye can see ...
Bankers who would rather cut their wrists than finance new homes, and ...
A new slump in housing that's worse than even some pessimists were expecting.
THIRD, despite his now-famous quote that this is "the worst labor market since the Great Depression," Bernanke failed to reveal that ...
Official Government Data GROSSLY Understates the Magnitude of Unemployment
Bernanke did not mention that the percentage of long-term unemployed in America is the worst it's been since the government began keeping records in 1948. Two facts:
Fact #1: A record 4.39 percent of the work force — or 46.2 percent of the unemployed — have been out of work for 27 weeks or more. That's DOUBLE the worst level ever recorded and TRIPLE the peak level seen in five of the past six recessions.
Fact #2: On average, America's unemployed have been out of work for 35.2 weeks, also the highest on record.
Bernanke did not remind Congress that, based on the government's own broad measure, the true unemployment rate in the U.S. is not 9.5 percent. It's 16.5 percent — or seven full percentage points more than the figure Mr. Bernanke likes to refer to.
This broader measure includes workers seeking full-time employment, but temporarily settling for lower paying part-time jobs. Plus, it's supposed to also include "discouraged workers" — those who have given up looking for work because there are no jobs to be found.
Nor did Bernanke confess that, during the Clinton administration, discouraged workers were "redefined" to EXCLUDE those who had been out of work for more than a year — and that definition continues to be used to this day.
That makes absolutely no sense. If they're out of work for a year, they're discouraged. But as soon as they're out of work for a year and one day, it's suddenly assumed they're happily going about their life?!
Thus, precisely when economists now recognize that one of the biggest challenges of this Great Recession is long-term unemployment ... the Obama administration, both parties in Congress, and all U.S. government agencies continue to exclude the longest term unemployed from every single one of their unemployment statistics.
This could go down in history as one of the greatest deceptions about the true state of U.S. labor markets. And according to John Williams of Shadow Government Statistics, it's big:
When you add these long-term discouraged workers back into the jobless count, you find that the real unemployment rate in the U.S. is actually 21.6 percent!
FOURTH, Bernanke failed to point out that all this is happening despite ...
The Biggest Government Interventions of ALL TIME!
The full scope of the government's interventions is now official:
In its July 21 Quarterly Report to Congress, the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) tabulates the government's bailouts, stimulus programs, and money printing escapades since the debt crisis struck in 2007, as follows:
The Fed has pumped in $1.7 trillion through its massive purchases of mortgage bonds, Treasury bonds, and agency bonds.
The FDIC has thrown another $300 billion into the pot, shutting down over 100 banks so far this year.
The Treasury has pumped in a net of $300 billion in TARP money (even after paybacks), plus another $500 billion in money outside of the TARP program.
Plus, several other government agencies have chipped in another $800 billion.
These official numbers are actually LARGER than we were estimating. We had the total pegged at $3.5 trillion (not billion), including the 2009 stimulus package.
SIGTARP has it at $3.7 trillion, excluding the stimulus but including a myriad other rescue programs — by the Federal Housing Finance Agency (FHFA), the National Credit Union Administration (NCUA), the Government National Mortgage Association (GNMA), the Federal Housing Administration (FHA), and the Veterans Affair (VA).
But no matter how you count it, some outstanding facts are absolutely self-evident:
FACT: The enormous magnitude of the government's intervention FAR surpasses anything ever witnessed in the history of humankind.
FACT: It's not working! Housing is still collapsed. Long-term unemployment is the worst ever recorded. And the recovery, already anemic, is aborting prematurely.
FACT: Most important, it's winding down! Through mid-2009, the government intervention programs tabulated by SIGTARP were being ramped up at a furious pace — a total of $3 trillion overall.
So over the 12-month period from mid-2008 through mid-2009, we estimate they were running at the average monthly pace of about $160 billion. But since mid-2009, they have been far slower, running at an average monthly pace of only $58 billion, or just one-third the prior level. And right now, the pace of new funds injected into the economy through these government rescues are merely a trickle compared to their earlier rate:
**No new stimulus is in the works.
**No new TARP funds are forthcoming.
**The Fed has wrapped up its bond buying splurge.
**And the ONLY significant continuing programs are for housing — the one area where the government has admittedly seen the WORST overall results, according to SIGTARP.
Bottom line:
If you were counting on the government to prevent the second major leg in this great double-dip recession, don't hold your breath. To the contrary, the primary CAUSE of the second dip is the government's conspicuous absence from sectors where it was, until now, the biggest mover, shaker, buyer, and financier.
Keep your eyes open and prepare for the future.
Saturday, July 24, 2010
North Korea Threatens Nuke To War Exercises
North Korea said it would counter U.S. and South Korean joint naval exercises with “nuclear deterrence” after the Obama administration said the government in Pyongyang shouldn’t take any provocative steps.
US aircraft carrier ups pressure on NKorea. The military drills, code-named "Invincible Spirit," are to run Sunday through Wednesday with about 8,000 U.S. and South Korean troops, 20 ships and submarines and 200 aircraft. The Nimitz-class USS George Washington, with several thousand sailors and dozens of fighters aboard, was deployed from Japan.
Well, Kim Jong Ill is a wild card, so this will be interesting. NKorea has also been in contact with Iran and Pres. Imanutinthehead. Don't know what will happen, but keep your eyes open.
US aircraft carrier ups pressure on NKorea. The military drills, code-named "Invincible Spirit," are to run Sunday through Wednesday with about 8,000 U.S. and South Korean troops, 20 ships and submarines and 200 aircraft. The Nimitz-class USS George Washington, with several thousand sailors and dozens of fighters aboard, was deployed from Japan.
Well, Kim Jong Ill is a wild card, so this will be interesting. NKorea has also been in contact with Iran and Pres. Imanutinthehead. Don't know what will happen, but keep your eyes open.
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