Senators’ Chinese junket is shrouded in secrecy

If it’s Passover, it must be Hong Kong. If it’s Easter, it must be Beijing. If it’s spring break, it must be a week-long jaunt by a large Senate delegation to China, led by Majority Leader Harry Reid (D-Nev.).

Ten senators, coming off a tough legislative session, plus spouses, staffers and military escorts, landed in the Middle Kingdom on Monday to begin a fine tour to Hong Kong, Chengdu, Xian and Beijing. The Senate news release calls it an “informational trip throughout China,” which Loop Fans know is a tip-off that this is going to be an excellent time.

There will be “site visits of American investments and clean energy projects,” and they are going to discuss “the global economy, security, trade, currency and foreign policy.”

Yes, indeed. There will be no time for shopping in Hong Kong and hardly any time to tour the giant panda’s native habitat in Chengdu or see the ginormous Buddha at Leshan. Not a minute for the Terra Cotta Warriors in lovely Xian, a walled city and the gateway to the Silk Road.

They’ll be so rushed gathering facts, they won’t have a chance to see the wonderful mausoleum of the Western Han emperor Liu Qi and his wife, a site out by the Xian airport that in some ways is more interesting than the famed warriors. But they’ve got to eat, so a stop at that dumpling restaurant just outside the wall is a must. You can tell what’s inside the dumplings because they’re shaped like pigs, cows, ducks, etc. And forget the Great Wall.

The trip is called a “senior” Senate delegation because, in addition to Reid, second-ranking Democrat Dick Durbin (Ill.) and other major players are on board: Democrats Barbara Boxer (Calif.), Chuck Schumer (N.Y.), Frank Lautenberg (N.J.), Jeff Merkley (Ore.) and Michael Bennet (Colo.) and Republicans Richard Shelby (Ala.), Mike Enzi (Wyo.) and Johnny Isakson (Ga.).

Can’t say whether the delegation, to show Washington’s concern over human rights, will be celebrating Good Friday or Easter with any of the Christians in Beijing who’ve been arrested on recent Sundays in the latest Communist crackdown on religious groups.

We can’t say because, when we tried to get more details on the itinerary, we were told no more could be disclosed because of “security concerns.” Over the years this arrant foolishness has become a major dodge to hide what lawmakers are going to be doing no matter where they travel abroad. (More details are released after the trips, but usually not complete itineraries.)

China, after all, is generally about as dangerous as McLean. The only security threat in Xian might be if one of the Terra Cotta guys came alive, yelled “Hey! It’s Jeff Merkley!” and smacked him upside the head.

Fellow travelers

At least 17 (that’s seventeen) senators are in Asia this week. (Surely others must be headed to St. Peter’s Square, no?)

In addition to the Reid delegation, there’s a five-member group led by Senate Minority Leader Mitch McConnell (R-Ky.) on a week-long trip stopping in South Korea to discuss trade matters and then going on to some other to-be-disclosed destinations.

McConnell is joined by GOP Sens. Rob Portman (Ohio), Mike Johanns (Neb.), John Hoeven (N.D.) and Jerry Moran (Kan.). Spouses will be on the fine military jet but may not be going with the lawmakers to all locations.

Sen. Carl Levin (D-Mich.), after a private trip in the region with his wife on his own dime, meets Sen. Jim Webb (D-Va.) in Hong Kong. Webb, on a two-week tour starting in South Korea and Vietnam, joins Levin for a trip to Guam, Okinawa and Tokyo. This has to do mainly with issues involved in moving the Marines from the base in Okinawa to a new facility in Guam under a recent relocation deal with the Japanese. Unclear whether Webb’s wife is traveling on the earlier parts of the trip.

And now, the winners

And now, the winners of the In the Loop Naming Opportunities contest for 2011. This was to rename Iraqi streets, towns, rivers and such, or places at the sprawling U.S. Embassy there to honor American officials for their efforts in that country in recent years.

1. “Bed, Baath and Beyond Boulevard,” submitted by Marty Siegel, a retired Coast Guard civilian employee from Alexandria.

2. “Known Knowns Avenue, with a cross street named Known Unknowns,” which would yield “Known Knowns Known Unknowns Square,” submitted by Steve Hein, marketing director at a military services organization.

3. “The Dick Cheney ‘Welcome Liberators Arch,’ which serves as the majestic back entrance to the new open-air Baghdad public shooting range.” Submitted on background by a Senate Republican aide.

4. “Bremer Bridge to Nowhere — a sister bridge to that great American symbol in Alaska.” Submitted by federal employee Martin O’Connor of Round Hill, Va.

5. “The Bush Hanging Gardens, featuring the Wolfowitz Water (Boarding) Slide and the Douglas Leap of Feith bungee jump (you keep going up and down).” Submitted on background by a career Foreign Service officer from Maine.

6. “Lockheed Martin Northrup Grumman Boeing Raytheon Rockwell Dynamic Plaza,” submitted by Carroll Publications news editor Matt Neufeld of Greenbelt.

7. There were many entries focused on former CIA director George Tenet’s unfortunate “slam dunk,” used in describing to our colleague Bob Woodward the likelihood of Saddam’s having WMD. The judges were divided on which entry to pick, but we liked a small side street that could be called “Slam Dunk Court,” submitted by John Nemeth, a research analyst for the federal government.

8. And there were many entries riffing off “cakewalk.” The judges liked the “Dr. Ken Adelman Cakewalk Way,” submitted by Michael Doyle, a reporter in the McClatchy Newspapers bureau here, in honor of Adelman’s prediction that the Iraq invasion would be a “cakewalk.”

9. The Iraq University gym’s exercise and weight-loss equipment could be named the “Weapons of Mass Destruction,” suggested Steven Koenig of Fortaleza, Brazil.

10. “Richard Perle Gateway,” submitted by Navy civilian employee Harvey Kipper of Arlington.

Other fine entries that didn’t make the cut included an Iraqi soccer stadium named “Curveball Coliseum,” with a scoreboard that can fabricate numbers more to your liking, and “Bring ’Em On Boulevard.”

Congratulations to the winners and thanks to all for entering. A special thanks to our judges, Washington Post master researcher Lucy Shackelford and graphics guru Karen Yourish.

More from The Washington Post

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U.S. Debt Default Would Not Be The End Of The World

Dean Baker:

The NYT had a piece on the implications of the United States hitting its debt ceiling and running the risk of defaulting on its debt. The article exclusively presented the views of people who portrayed hitting the debt ceiling and defaulting on the debt as being an end of world scenario.

It would have been useful to present the view of people who do not consider a default on the national debt to be the worst possible outcome. While there can be little doubt that a default on the U.S. debt would lead to a financial crisis and would likely permanently reduce the role of the U.S. financial industry in world markets, it is also likely the case that the United States would rebound and possible rebound quickly from a default.

The experience of Argentina may be instructive in this respect. Argentina defaulted on its debt at the end of 2001. Its economy fell sharply in the first quarter of 2002 but had stabilized by the summer and was growing strongly by the end of the year. By the end of 2003 it had recovered its lost output. Its economy continued to grow strongly until the world recession in 2009 brought it to a near standstill.

While there can be no guarantee that the U.S. economy would bounce back from the financial crisis following a default as quickly as did Argentina, it's unlikely that U.S. policymakers are too much less competent than those in Argentina.

Readers should be made aware of the fact that countries do sometimes default and they can subsequently recover and prosper. Many people may consider the short-term pain stemming from a debt default to be preferable to the long-term costs that might come from policies adopted to prevent default.

For example, if Congress were to approve a Medicare plan along the lines proposed by House Budget Committee Chairman Paul Ryan, this would be subjecting tens of millions of middle class retirees to a retirement without adequate health care insurance and potentially devastating medical bills. Plans being put forward to cut Social Security could have similar consequences. Compared to these outcomes, a financial crisis and the subsequent slump that follows may seem like a relatively small cost.

It is also worth noting that two of the people whose views were presented in this article, Jamie Dimon, the CEO of J.P. Morgan (JPM) and Robert Rubin, a former top executive at Citigroup (C), are both individuals whose situation is likely to make them view a debt default as an end of the world event. Both institutions would likely not survive a debt default. For the people whose wealth depends on the health of Wall Street financial firms, a default on the U.S. debt is probably one of the worst conceivable events in the world, however this group is a tiny minority of the U.S. population.

###

Why We Must Freeze the Debt Limit

By CATO Economist Jagadeesh Gokhale

Excerpt

They all assert that failing to increase the debt limit could sharply undermine the economic recovery.

But that view could be wrong. A temporarily frozen debt limit could instead signal U.S. lawmakers' resolve to get our fiscal house in order. It may even reassure investors about long-term U.S. economic prospects.

With the national debt at $14.27 trillion and rising, Congress must soon approve an increase in the legal debt ceiling — now at $14.29 trillion — so that the Treasury can continue conducting the nation's fiscal operations.

Given the imbalance between obligations and revenue from taxes and other sources, the Treasury would technically be in default within a matter of weeks if it fails to obtain the legal authority to issue additional Treasury securities. Government officials fear that this outcome will cause financial markets to seize up and impede the economy's fragile recovery.

Ordinarily, a Treasury default would have a considerable negative effect on international financial markets. This could be heightened now — given the potential for an early end to the Fed's QE2 asset purchase program and continuing speculation about when (not if) the Fed will begin increasing its overnight borrowing rate.

Some private investors are already shorting Treasuries in anticipation of a decline in their prices. Others fear that if the debt limit is not increased soon, the expected gradual withdrawal from Treasury securities — the normal response during economic recoveries as investors begin to tolerate greater investment risks — may turn into a stampede.

How valid are these concerns? Not very.

Freshman House Republicans, however, insist that their mandate is to rescue the nation from the negative outlook that S&P is predicting could eventually cause a real debt default.

In contrast, the current prospect of a technical default, from failing to increase the debt limit, would not be due to any real national insolvency. Given today's low interest rates, the federal government could easily raise the resources needed to meet today's contractual government obligations.

The correct description for the technical default from Congress' failure to increase the debt limit, therefore, should be "a temporary suspension of fiscal operations to promote a more prudent fiscal course."

http://www.cato.org/pub_display.php?pub_id=13031

Dollar hits 15-month low against euro

The dollar took a beating Wednesday, losing ground to a range of currencies, and falling to its lowest level against the euro in 15 months.

And that's pretty much been the trend in recent months. At the start of the year, the euro was trading at $1.33 against the dollar, but has since surged to $1.45 against the beleaguered greenback.

The dollar index, which measures the U.S. dollar against a basket of currencies, has fallen 5% so far this year to around 74, as jittery investors flocked to the dollar for safety. That's down from a high near 87 in June of 2009.

The continued weakening of the dollar -- if you go by reputation -- is a little puzzling. The dollar is thought of as a safe haven asset in times of turmoil. If you look at the past four months, it's hard to find anything but unsettling events. Japan. Egypt. Libya. Eurozone debt.

But the dollar has failed to appreciate.

One reason the dollar is suffering is the continued strength of equity markets. On Wednesday, the Dow was up triple digits, as investors flocked to riskier investments.

Plus, you've got the expansive monetary policy of the Fed, which some experts say weakens the dollar, and a dysfunctional U.S. political system that has put investors on edge.

Still, investors might want to hold off on hitting the panic button. The dollar remains about 8% above its all-time low against the euro set in July 2008. But more trouble might be ahead.

On Monday, Standard & Poor's turned pessimistic about the chances of a near-term resolution of the deficit problems. Gold and Silver (safe haven assets) shot up. The dollar languished.

Win Thin, global head of emerging-market strategy at Brown Brothers Harriman, said currency traders aren't particularly worried about the S&P warning. At least not yet.

He said there is little hope for a debt reduction deal before 2013, something that S&P seems to suggest as well.

"We get a bit of a pass for now," Thin said. But if politicians continue to drag their feet, and S&P actually downgrades U.S. debt, that's when the bottom will fall out for the dollar.

"If the U.S. loses its AAA rating, all the metrics go away," he said.

Bankruptcy in America

Many banks are insolvent, yet are allowed to stay in business. Being allowed to keep two sets of books is obscuring their real estate loan problems. This is the shadow inventory you sometimes hear about. Those millions of homes “that exist, but they don’t.” They presently admit to owning some 1 million homes they cannot sell, which is almost 25% higher than last year. If you put everything together you could be looking at an 8-year supply. Making matters worse lenders are holding homes on the books at values 40% higher than what they are worth. This is very similar to what is going on in Spain presently. We’ll say this one more time. Most major banks and some middle tier and small institutions are broke and you are being lied to regarding their condition.

Distressed home sales make up about 50% of all sales and they are sold at rock bottom prices, which drives down the value of all homes. This condition could last another ten years. In California and Nevada such sales are some 70% of sales. This inventory will continue to suppress prices for some time to come, so do not even think about buying a home. Those lower foreclosure figures are a mirage caused by legal action against lenders. Those foreclosure numbers will grow higher soon, because these criminals are cutting a deal to pay fines, so no one goes to jail. Only in America. That foreclosure activity could come back slowly due to major changes in the industry.

As foreclosures pick up following a deal with the government the shadow inventory will build, banks will sell more homes, prices will fall further, losses to the banks will grow and the banks inadequate loan loss reserves will become evident. Then there are the ongoing lawsuits against the banks and their creation known as MERS, which has no further legal standing. We could see millions of mortgages being cancelled that is unless the crooks in Congress pass a forgiveness bill to relieve the banks of their fraud. The bottom line is many more banks are going under and some will be major banks.

As we predicted in June of 2005 that the housing market would crash we also predicted a 10 to 40 year fall and consolidation in housing. Most people can reflect on these past six years, but cannot perceive the future for housing. Market activity has fallen by almost 1/3rd, as housing prices fell ever lower. Although we do not see an increase in official interest rates we can easily see mortgages at 5-5/8% by the end of the year and 6-1/2% at the end of 2012. Lenders are going to have to demand 10% to 20% down. That will not only further decrease sales volume, but it will further depress prices. These rates may seem high, but inflation will be between 14% and 30% over that 1-1/2 to 2 year span.

Since 2006 house prices are down 32% and over the next year they will probably fall close to 40% from their highs. The Fed may have temporarily saved banking and Wall Street, but little has been done to solve the unemployment problem. If you have no job you cannot buy a house, not with real unemployment at 22%. As a result new home sales fell 28% in February, as their inventories rose to 8.9-month’s sales. Our question is with such a tremendous home inventory overhang, why are builders building more homes, some 550,000 a year. They have to be dumber than rocks. Existing houses for sale rise every day plus there are more than a million in the foreclosure crisis. House prices still have to hit bottom and that is probably 30% lower and probably 3 years away. It is hard to get real estate going with unemployment at 20% and forced part-time employment at 10 million workers. Deceptive government statistics can only hold back reality for so long. People are finally seeing the truth of what unemployment and under-employment really are. Labor deterioration is accompanied by gas and food inflation. People at work paying steeply higher prices are in no position to buy a home. Feeding the family comes first. As a result of forced Fed policies we also have a falling dollar that increases prices for imported goods.

If all this wasn’t bad enough municipalities and states are in serious financial trouble.

Their working force makes up 15% of overall employment and 70% of costs. That means to cut costs you lay people off first. That increases unemployment and disqualifies future homebuyers and puts more underwater homes into foreclosure, which compounds lenders’ losses. Do not underestimate these layoffs, because they will have a strong negative affect on the overall economy. This year was really the beginning of these municipal and state layoffs. Looming in the shadows is the possibility of hundreds of municipal bankruptcies; 35 states are in the same position with no end in sight. Very few people really understand how serious the overall situation really is. These events take a terrible toll on consumer confidence. These were supposed to be lifetime jobs. What happens when pension checks stop due to bankruptcy? That has to slow the economy. 90% of state and local costs are for education. That means more layoffs and doubling class sizes to 40 children. Children are learning very little in school and their success is held down by the quality of students. It will be pandemonium with giant class sizes and many of the best teachers will resign.

The government supplies 35% of wages. Food stamps are helping to feed 44 million Americans. Government wants to cut Social Security, which people have paid into, but is erroneously allowing thousands in under disability. Medicare is a shamble, and Medicare is worse. In spite of the current problems 75% of Americans do not support cuts to Medicare and Social Security. In spite of that, if Wall Street and banking want less benefits, that is what Americans will get. America is accelerating to a welfare state.

Corporate America is in a dilemma. They are facing higher costs for petroleum products and food. This affects profits, if not passed on, business will eventually have to pass these costs on. In that environment there can be little hiring and little if any job growth. If they hold back price increases when increases do come they’ll be very large.

Each day statements from the Fed get more bizarre. One of the latest ones is the Fed has to be accommodative because the central bank remains blow its targets for inflation and employment. Inflation is somewhat high and employment is dreadful.

Bob Chapman is a frequent contributor to Global Research. Global Research Articles by Bob Chapman

Propaganda From Re/Max CEO Margaret Kelly: We've Been Wrong Every Month For 5 Years, But Now Is REALLY The Time To Buy (Bloomberg Interview)

http://tinyurl.com/3pcgvxj

Two things to keep in mind. She is on the Board of the Kansas City Fed, which is Hoenig's bank. And she is wrong about home ownership being the American Dream. Read this from Bank of America CEO Brian Moynihan.

Read the full story at Bloomberg

Video - April 20 - Margaret Kelly, chief executive officer of Re/Max International Inc., talks about the outlook for the U.S. housing market.

OUTRAGE: Taxpayer Funded Job Center Spent Tens Of Thousands On Superhero Capes For The Unemployed

Before you do anything else watch this video that your tax dollars helped pay for...

• WFC Cape Video

WCF or Workforce Central Florida gets $24 million annually from federal taxpayers and accomplishes virtually nothing based on their own statistics.

Federal and state job training is overfunded, disorganized, and practically useless. There are over 100 federal job-training programs, all pet projects, none of them coordinated.

---

Raw Story

The jobs agency plans to distribute the superhero capes to residents taking part in the agency's "Cape-A-Bility Challenge" by trying to vanquish "Dr. Evil Unemployment."

Residents of central Florida can win a cape by becoming a Workforce Central Florida fan on Facebook, taking a Facebook quiz, having a photo taken with a foam cutout of Dr. Evil Unemployment, tweeting a job posting, or using LinkedIn to recommend someone using the word "super."

The agency also spent about $2,300 on 12 five-feet-tall foam board cutouts of Dr. Evil Unemployment.

--

Source - Orlando Sentinel

In addition to the $14,200 for capes, Workforce will spend about $24,700 on media buys, $15,000 for billboards and $5,000 on social media.

Just $2,000 will go for prizes and only two prize packages — one for an employer, one for a job seeker — will be awarded.

Michelle Burman, an out-of-work customer service rep, was incredulous.

"OK, $73,000 for the 'Cape-A-Bility Challenge' and $14,000 for capes?" she said. "And this will be helping who?" Burman wondered if the capes would "have some sort of magical powers to obtain a job faster" and predicted few would rush to join the ranks of the "Super Unemployed."

Stuart James, a laid-off construction manager, was more direct.

"That," he said, "is absolutely absurd."

Workforce is a federally funded labor development agency that last year received almost $24 million in public money. It is a private, nonprofit organization governed by more than 40 Central Florida business leaders.

Between July 1, 2009, and June 30, 2010, the agency says it served more than 210,000 job seekers and helped place more than 58,500 into jobs.

Sullivan defended the campaign, saying it will spread the agency's message. The capes, she said, are a direct tie-in to the larger effort.

"Some people will wear them, and others will ask 'How do I get one?'" she said.

She said Workforce was "in no way" trying to minimize the difficulties of unemployment. The agency is trying to "create the face of unemployment and allow people to have a little fun with it,'' she said.

"Everyone," Sullivan said, "is a superhero in the fight against unemployment."

The One-Percenters

"The upper 1 percent of Americans are now taking in nearly a quarter of the nation's income every year. In terms of wealth rather than income, the top 1 percent control 40 percent.

"Their lot in life has improved considerably. Twenty-five years ago, the corresponding figures were 12 percent and 33 percent."

So I discover in a piece by Joseph E. Stiglitz in the new issue of Vanity Fair. These facts confirm my impression that greed is now seen as a virtue in America. I'm not surprised by the greed of the One-Percenters. I'm mystified by the lack of indignation from so many of the rest of us.

Day after day I read stories that make me angry. Wanton consumption is glorified. Corruption is rewarded. Ordinary people see their real income dropping, their houses sold out from under them, their pensions plundered, their unions legislated against, their health care still under attack. Yes, people in Wisconsin and Ohio have risen up to protest these realities, but why has there not been more outrage?

The most visible centers of these crimes against the population are Wall Street and the financial industry in general. Although there are still many honest bankers, some seem to regard banking and trading as a license to steal. Outrageous acts are committed and go unpunished. Consider this case of money laundering by Wachovia Bank, now part of Wells Fargo. This Guardian article reports: "The authorities uncovered billions of dollars in wire transfers, traveler's checks and cash shipments through Mexican exchanges into Wachovia accounts."

The bank paid fines of less than 2% of its $12.2 billion profit in 2009. No individual was ever charged with a crime. We need not doubt that Wachovia executives received bonuses over the period of time when they were overseeing these illegal activities. Permit me to quote one more paragraph:

"More shocking, and more important, the bank was sanctioned for failing to apply the proper anti-laundering strictures to the transfer of $378.4 billion -- a sum equivalent to one-third of Mexico's gross national product -- into dollar accounts from so-called casas de cambio (CDCs) in Mexico, currency exchange houses with which the bank did business."

If a third of the Mexican GNP passes through your bank and you don't ask the questions required by law, you are either (1) a criminal, or (2) incompetent. I can't think of another possibility.

Stories like this have become commonplace. Two of the most common types of news stories about banks recently have involved their losses, and the size of their executive bonuses. Bloomberg News reports: "JPMorgan Chase & Co. gave Chief Executive Officer Jamie Dimon a 51 percent raise in 2010 as the bank resumed paying cash bonuses following two years of pressure from regulators and lawmakers to curb compensation."

And here's more, from the Wall Street journal: "$57,031. That's about what the average U.S. archaeologist made last year. It's also what J.P. Morgan CEO Jamie Dimon made every day of last year -- $20.8 million total, according to the firm's proxy filing this week. Anyone who has doubts about the resiliency of Wall Street banks and brokerages should ponder that figure for awhile. The J.P. Morgan board also spent about $421,500 to sell Dimon's Chicago home. And they brought back the big cash bonus, doling out $30.2 million in greenbacks to Dimon and his top six lieutenants."

The CEOs of the venerable trading firms that were forced into bankruptcy were all paid bonuses. In a small recent case, executives of Borders intended to pay themselves $8 million in bonuses until a U. S. Trustee objected. A company spokesperson said, "The proposed programs were designed to retain key executives at Borders as we proceed through the Chapter 11 reorganization process." In short, retain those whose management bankrupted the corporation.

Corporations in theory are managed to benefit their shareholders. The more money Wal-Mart can make by busting unions and allegedly discriminating in its hiring practices, the happier its shareholders become. Yet obscene bonuses penalize even the shareholders. Isn't that, in theory, their money? Wouldn't it be decent for the occasional corporation to put a cap on bonuses and distribute the funds as dividends?

I have no objection to financial success. I've had a lot of it myself. All of my income came from paychecks from jobs I held and books I published. I have the quaint idea that wealth should be obtained by legal and conventional means--by working, in other words--and not through the manipulation of financial scams. You're familiar with the ways bad mortgages were urged upon people who couldn't afford them, by banks who didn't care that the loans were bad. The banks made the loans and turned a profit by selling them to investors while at the same time betting against them on their own account. While Wall Street was knowingly trading the worthless paper that led to the financial collapse of 2008, executives were being paid huge bonuses.

Wasn't that fraud? Wasn't it theft? The largest financial crime in American history took place and resulted in no criminal charges. Then the money industries and their lobbyists fought tooth and nail against financial regulation. The Republicans resisted it, but so did many Democrats. Partially because of the Supreme Court decision allowing secret campaign contributions, our political system is largely financed by vested interests.

We know that Bernie Madoff went to jail. Fine. No Wall Street or bank executive has been charged with anything. It will never happen. The financial industries are locked an unholy alliance with politicians and regulators, all choreographed by lobbyists. You know all that.

What puzzles me is why there isn't more indignation. The Tea Party is the most indignant domestic political movement since Norman Thomas's Socialist Party, but its wrath is turned in the wrong direction. It favors policies that are favorable to corporations and unfavorable to individuals. Its opposition to Obamacare is a textbook example. Insurance companies and the health care industry finance a "populist" movement that is manipulated to oppose its own interests. The billionaire Koch brothers payroll right wing front organizations that oppose labor unions and financial reform. The patriots wave their flags and don't realize they're being duped.

Consider taxes. Do you know we could eliminate half the predicted shortfall in the national budget by simply failing to renew the Bush tax cuts? Do you know that if corporations were taxed at a fair rate, much of the rest could be found? General Electric recently reported it paid no current taxes. Why do you think that was? Why do middle and lower class Tea Party members not understand that they bear an unfair burden of taxes that should be more fairly distributed? Why do they support those who campaign against unions and a higher minimum wage? What do they think is in it for them?

If it is "socialist" to believe in a more equal distribution of income, what is the word for the system we now live under? A system under which the very rich have doubled their share of the nation's income in 25 years? I believe in a fair day's work for a fair day's pay. Isn't that an American credo? How did it get twisted around into an obscene wage for shameless plunder?

One of the challenges facing the One-Percenters these days is finding ways to spend their money. Private residences grow as large as hotels, and are fitted out with the amenities of luxury resorts. Fleets of cars and private airplanes are at their owners' disposal. At work, they sink absurd mountains of money into show-off corporate headquarters that have less to do with work than with a pissing contest among rival executives. Private toilets grow as large as small condos, outfitted with Italian marbles and rare antiques. This is all paid for by the shareholders. One area of equality between the One-Percenters and the rest of us is that we sit on toilets of about the same size. What's different is the size of our throne rooms.

I find this extravagance unseemly in a democracy. Many of today's One-Percenters feel no more constraint than Louis XIV. A culture of celebrity has grown up around these conspicuous consumers, celebrating their excesses. I believe rewards are appropriate for those who have been successful. I also believe a certain modesty and humility are virtuous. I find it unbecoming that those who fight most against social welfare are those most devoted to their own welfare.

In America there is an ingrained populist suspicion of fats cats and robber barons. This feeling rises up from time to time. Theodore Roosevelt, who was elected as a Trust Buster, would be appalled by the excesses of our current economy. Many of the rich have a conscience. Andrew Carnegie built libraries all over America. The Rockefeller and Ford Foundations do great good. Bill Gates lists his occupation as "philanthropist."

Yet the most visible plutocrat in America is Donald Trump, a man who has made a fetish of his power. What kind of sick mind conceives of a television show built on suspense about which "contestant" he will "fire" next? What sort of masochism builds his viewership? Sadly, I suspect it is based on viewers who identify with Trump, and envy his power over his victims. Don't viewers understand they are the ones being fired in today's America?

20 Signs That A Horrific Global Food Crisis Is Coming

#1 According to the World Bank, 44 million people around the globe have been pushed into extreme poverty since last June because of rising food prices.

#2 The world is losing topsoil at an astounding rate. In fact, according to Lester Brown, “one third of the world’s cropland is losing topsoil faster than new soil is forming through natural processes”.

#3 Due to U.S. ethanol subsidies, almost a third of all corn grown in the United States is now used for fuel. This is putting a lot of stress on the price of corn.

#4 Due to a lack of water, some countries in the Middle East find themselves forced to almost totally rely on other nations for basic food staples. For example, it is being projected that there will be no more wheat production in Saudi Arabia by the year 2012.

#5 Water tables all over the globe are being depleted at an alarming rate due to “overpumping”. According to the World Bank, there are 130 million people in China and 175 million people in India that are being fed with grain with water that is being pumped out of aquifers faster than it can be replaced. So what happens once all of that water is gone?

#6 In the United States, the systematic depletion of the Ogallala Aquifer could eventually turn “America’s Breadbasket” back into the “Dust Bowl”.

#7 Diseases such as UG99 wheat rust are wiping out increasingly large segments of the world food supply.

#8 The tsunami and subsequent nuclear crisis in Japan have rendered vast agricultural areas in that nation unusable. In fact, there are many that believe that eventually a significant portion of northern Japan will be considered to be uninhabitable. Not only that, many are now convinced that the Japanese economy, the third largest economy in the world, is likely to totally collapse as a result of all this.

#9 The price of oil may be the biggest factor on this list. The way that we produce our food is very heavily dependent on oil. The way that we transport our food is very heavily dependent on oil. When you have skyrocketing oil prices, our entire food production system becomes much more expensive. If the price of oil continues to stay high, we are going to see much higher food prices and some forms of food production will no longer make economic sense at all.

#10 At some point the world could experience a very serious fertilizer shortage. According to scientists with the Global Phosphorus Research Initiative, the world is not going to have enough phosphorous to meet agricultural demand in just 30 to 40 years.

#11 Food inflation is already devastating many economies around the globe. For example, India is dealing with an annual food inflation rate of 18 percent.

#12 According to the United Nations, the global price of food reached a new all-time high in February.

#13 According to the World Bank, the global price of food has risen 36% over the past 12 months.

#14 The commodity price of wheat has approximately doubled since last summer.

#15 The commodity price of corn has also about doubled since last summer.

#16 The commodity price of soybeans is up about 50% since last June.

#17 The commodity price of orange juice has doubled since 2009.

#18 There are about 3 billion people around the globe that live on the equivalent of 2 dollars a day or less and the world was already on the verge of economic disaster before this year even began.

#19 2011 has already been one of the craziest years since World War 2. Revolutions have swept across the Middle East, the United States has gotten involved in the civil war in Libya, Europe is on the verge of a financial meltdown and the U.S. dollar is dying. None of this is good news for global food production.

#20 There have been persistent rumors of shortages at some of the biggest suppliers of emergency food in the United States. The following is an excerpt from a recent “special alert” posted on Raiders News Network….

Read More: http://www.silverbearcafe.com/private/04.11/foodcrisis.html

Body of 'dead alien' is found in frozen wastes of Siberia after claims of UFO hurtling to Earth... but is it an elaborate hoax?

It just seems too strange to be true.

But in the frozen wastes of Siberia two walkers claim to have found the body of an alien.

On its side with its mouth slightly agape, the slender, badly-damage body lies half-buried in snow close to Irkutsk, Russia.

The area is a known UFO hotspot and video of the alien's corpse has become a massive worldwide hit with hundreds of thousands of followers after being posted on the internet.

Alien life? This strange 'body' was discovered by two walkers close to Irkutsk, Siberia, in a renowned hotspot for extraterrestrial behaviour

Reports of aliens crashing to Earth as in the 1947 Roswell incident have led to images purporting to be of extraterrestrials (left) circulating the internet. Popular fiction and Hollywood films, such as ET (right), continue to tap into the public's appetite for stories and conspiracy theories around alien life-forms

The corpse of the badly-damaged creature which resembles ET is 2ft-high.

Part of the right leg is missing and there are deep holes for eyes and a mouth in a skull-like head.

UFO fans believe the body could have been left behind by ET visitors after an accident, or missed by Russian military alien experts clearing up after a crash.

The area is a known UFO hotspot with dozens of sightings reported every year.

It follows reports of a UFO hurtling towards Earth in the nearby Irkutsk region of Siberia one month ago.

'We couldn't believe it when we saw it. And what was spooky is that there was no sign of the spaceship. Perhaps that was taken away and the body overlooked,' said Igor Molovic, one of the pair that uploaded the video.

The clip has now been seen by nearly 700,000 people within a few days.

Cynics claim the video is a fake using a carefully staged model for the alien's body.

But one fan wrote': 'It's so lame how people always get thrilled by having another excuse to shout "Fake! fake!" every time something weird shows up. Unless proven otherwise, this is in fact plausible.'

'If this is fake - then they are masters at models/puppets. I think it's real - one of the very few, great vid.,' said another.

UFO fans believe the body could have been left behind by ET visitors after an accident, or missed by Russian military alien experts clearing up after a crash

The purported existence of aliens featured heavily in the hugely successful TV series The X Files, starring David Duchovny and Gillian Anderson (pictured)

Finnish election has implications for euro crisis

Commission notes that Finland is already committed to Portugal bailout

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The result of Sunday’s Parliamentary elections in Finland pushed the country into the centre of the crisis of the euro zone.
Much could be riding on Finland. If the new Finnish government and Parliament do not give their backing to the EUR 80 billion loan package approved for Portugal, the whole bailout plan will collapse.

The rules of the temporary crisis fund, the European Financial Stability Facility (EFSF), are clear: A decision on providing funding for a euro country in trouble – Portugal in this case – needs to be made unanimously.
The European Commission noted on Monday that Finland is already committed to helping Portugal. Finland gave its political commitment to using the EFSF at a meeting of EU ministers of finance just over a week ago in Gödöllö in Hungary.

According to the European Commission’s main spokeswoman, Pia Ahrenkilde Hansen, the Commission has full confidence that Finland will meet its obligations.
“Nothing has changed from our point of view”, Ahrenkilde Hansen said in response to speculation that there may be a contingency plan.

Finland needs to clear up its view on helping Portugal by mid-May at the latest. It is at that time that the EU foreign ministers are to agree on the Portuguese bailout package and how it is to be financed.
Special arrangements to accommodate Finland are not in the cards. If Finland does not start helping Portugal along with the others, it will cost Finland dearly in political capital.
On Monday, the Commission and the euro zone countries were careful not to add to pressure on Finland. Ahrenkilde Hansen, who serves as the spokeswoman Commission President José Manuel Barroso, a Portuguese citizen himself, said that Finland should first draw up a government programme.

Economic and Monetary Affairs Commissioner Olli Rehn will have his work cut out for him after the surprising result of the Finnish elections.
Last week, Rehn had said in Washington that the rescue operation for the euro zone is practically a done deal.
However, the success of the True Finns and the Social Democrats in the elections changed the situation overnight. The uncertainty was reflected on financial markets as well.

It will now depend on Finland if the negotiation results are implemented in the summer.
Wilfred Martens, chairman of the European Peoples Party, said on Monday that he is sure that Finland is, and will remain committed to European and Nordic values. Shortly before that, he had expressed regret over the success of the True Finns.
Fifteen of the EU’s heads of government are members of the centre-right EPP. If Jyrki Katainen of the National Coalition Party becomes Prime Minister, the number will be 16.

Governor Dictatorship and Communism in Full Speed and Full View! U.S. is becoming Communist in Federal and State Levels! Michigan Police Tech.

Did our Forefathers sign the Constitution for naught? At what point will "We the People" stand up for our Forefather's Ideals for the Nation Under God which they founded?

I don't agree with how Rachel Maddow will say "Left versus Right". I don't believe there is a Left or Right anymore. I believe all in elected office have the same agenda: POWER! Giving the Power over to corporations is being done by both the Republicans and Democrats! Both side have a communist agenda, they just play their parts, it is the same people controlling both sides!

The Republican Governor of Michigan is not even hiding his communist agenda or Corporation takeover of the state in the least! He has taken away elected officials powers on the local level and is now even taking over a public park and giving it to a corporation to build a high end golf course and luxury homes!


People need to understand the left and right that the media plays up, is all BullS*&^! They are all the same, it would not matter who got in office anywhere, when an elected official is bought and sold by the same corporations and banks they do as they are told!

When will people WAKE UP to the fact we have NO CONSTITUTION ANYMORE! It has been taken from us in the Federal Level and the State Levels are now working the communist Agenda in!


Besides the fact the Governor of Michigan has become a dictator in taking elected officials rights he has now allowed unconstitutional grabs of all technology information off people's phones by the State Police during simple pull overs!

Portion of Police being allowed to Scan all technology without warrants!

Michigan: Police Search Cell Phones During Traffic Stops

ACLU seeks information on Michigan program that allows cops to download information from smart phones belonging to stopped motorists.

CelleBriteThe Michigan State Police have a high-tech mobile forensics device that can be used to extract information from cell phones belonging to motorists stopped for minor traffic violations. The American Civil Liberties Union (ACLU) of Michigan last Wednesday demanded that state officials stop stonewalling freedom of information requests for information on the program

"Complete extraction of existing, hidden, and deleted phone data, including call history, text messages, contacts, images, and geotags," a CelleBrite brochure explains regarding the device's capabilities. "The Physical Analyzer allows visualization of both existing and deleted locations on Google Earth. In addition, location information from GPS devices and image geotags can be mapped on Google Maps."

Rachel Maddow's complete Expose of the Michigan's Governor's Communist Agenda!

Visit msnbc.com for breaking news, world news, and news about the economy

Edit - Detersbb left this link in a comment below - it is the Executive Order taking over Benton Michigan for "Financial Reasons" and relieving the Mayor and all the Elected officials of their duties and enacting a dictatorship for the area! Thank you Detersbb!

http://www.revolutionaryviews.com/chris/Eclectablog/JoeHarrisOrders.pdf

“PEACE MONGERS” IN SHEEPS CLOTHING

2

TWO OF THESE AND YOU HAVE A CIRCLE... SORT OF

THE EXTREME RIGHT MAKES A HARD “LEFT” TURN INTO UNFAMILIAR TERRITORY

By Gordon Duff / Veterans Today

There are at least two ways to look at the UN/NATO intervention in Libya. From an egalitarian standpoint, there is a resolution from the United Nations Security Council authorizing the use of force against the Gaddafi regime. Russia and China could have easily vetoed it but chose to abstain. They stayed out of it to cover their backsides. They know what Gaddafi, a known psychopath, is capable of but they also know what the US, Britain, France and Italy can do also. Gaddafi isn’t the only psychopath.

As to vital national interests, Libya hardly counts. That the Mediterranean has long been accepted as an “American lake,” does loosely imply both American responsibility and complicity in anything that happens there as multiple interventions in Lebanon attest to. The world has one of those “since you are there anyway….” views about the US in the Mediterranean.

(On a side note, Saudi Arabia decided today to cut oil production, all the while oil is heading for the highest prices in history. More on this in a bit. The oil problem isn’t Libya but rather speculation in oil futures meant to bleed the US economy dry. The recent attack on the dollar is partially driven by oil speculation.)

A key security component, not taken into account by most, is the enmity between Libya and Egypt, nations that share a common religion and absolutely nothing else, that has “fertilized” a decades old “marriage of convenience” between Israel and Libya, one we saw signs of during the early days of the current rebellion.

That “second” way is to oppose any US involvement. For some, it makes sense, a clear result of moral and political views. However, many of the new “peace mongers,” are a different lot, more “chickenhawk” than “dove.”

For the “left,” reasons could be a love of peace, of which there is none, a sign of less than deep understanding of the issues, or a mistrust and even hatred of the United States and a belief that anything America does is driven by sinister intentions.

There certainly is a long and well established history of America acting with sinister intentions, no question about it. Suspicion is always reality based.

Then again, we now have inside the “no Libya intervention” group these very inexplicable “scavengers,” certainly not “predators,” who have taken on the mantle of “moral leadership,” something that may add a new and strange dimension to their resumes.

Our problem is that those leading the pack in damning the United States as a colonialist and aggressor is the same group supporting the policies of endless war in Afghanistan, a new war on Iran, unquestioned support for Israel’s predatory policies and the horrific human rights violations the United States has engaged in for years, kidnapping, torture and blanket assassinations, the “dronings.”

CALL TO ARMS OR GATHERING OF COCKROACHES

Subsequent to US involvement in Libya, orders went out to Americans known as “Israeli firsters.” With little education and background, particularly for those serving in congress, as we all know only too well, none questioned the idea of helping Israel by supporting a vicious dictator that has spouted violent threats and spewed Antisemitism for decades. None asked why he has never been targeted, why he has gotten a free ride from the media for so long.

No “deep thinkers” were called on.

Our ‘friends” were to mount a “cover operation” to defend the Gaddafi regime because of its strategic relationship to Israel and its close financial associations with US banking houses and oil companies. Gaddafi had become a goldmine for, not only “big oil” but defense companies as well. Libya became the second biggest lobbying force in Washington, next to Israel. While other nations, like China, are castigated for any involvement in American politics, Libya is given ‘carte blanche.” For a nation some imagine to be a threat to the security of Israel,

This was no simple task, particularly in light of recent events.

News reports from every source report the use of cluster bombs, artillery and rockets against civilian target in rebel held areas. Deaths are mounting up and there is a very real human disaster in the making, no one disputes that.

SEXUAL PERK FOR JOINING THE "LEFTY" ANTI-WAR CROWD

For those who follow Islamophobic pundits and the Zionist pro-war, “sacrifice Americans without thought” mindset, the idea of going “soft” on a brutal Muslim extremist dictator should seem a contradiction yet no one notices the 180

degree turn around. Curious. Perhaps years of conditioning paid off and the armies of rednecks and militia types quickly joined the “loafered lefties” on the “peacenik picket lines.” Are our “tobbacky chawing” friends looking for “hot hippie chicks?”

This has been a hoot!

WATCHING IT PLAY OUT

Where, then, does the controversy come into play? Why has the “right,” initially clamoring for an attack on Gaddafi as early as February now done a 1000% turnaround?

Let’s take a look at the positions held by this new anti-war group.

Note that there is no call for leaving Afghanistan, nobody got the word out that Afghanistan is a war too. Call our friends “careless.”

The only war they are against is Libya? Remember, this is the group that pushed for the attack on Iraq, in fact it is the same group that is pushing actively for an attack on Iran, a military action judged by Pentagon officials responsible for our “war plans” as larger than both Vietnam and Korea combined.

Think of this as moral and political schizophrenia.

This new anti-war crowd wants to crush Iran, beginning with attacks on nuclear facilities (reported as “peaceful” by international inspectors), spreading radiation across Asia, followed, of course by a massive ground invasion. Why do we talk of schizophrenia? How many contradictory views can a mind with so little reasoning capacity hold at one time?

This is a group that calls America’s actions in Libya, or rather “Obama’s” actions in Libya “war crimes” but, not only supported torture and rendition under Bush but still support it. Another oversight. Our new “pro-human rights” advocates seem to have only one human on their list, Colonel Gaddafi. The rest of the world can be waterboarded, gang raped and tossed into a mass grave like was done in Afghanistan to 2000 POWs early in the war.

This is the group that has lobbied to keep Guantanamo open, then turn around attacking Obama for not closing Guantanamo.

BORN AGAIN ANTI-NUKE ACTIVISTS AND SCANNER LOVERS

Though opposing DU use in Libya, not by Gaddafi who we have found has used Depleted Uranium munitions in his own country against his own people, though that relationship seems somewhat strained of late, but by the US only, our new ‘anti-nuke’ activists seem to hold even more contradictory views. They love airport scanners and think they are totally safe. Not everyone agrees with this, however.

In a report from the Daily Mail:

Dr David Brenner, head of Columbia University’s centre for radiological research, said about airport scanners:

• he is urging researchers to carry out more tests on the devices to look at the way they affects specific groups who could be more sensitive to radiation.

• the most likely risk from the airport scanners is a common type of skin cancer called basal cell carcinoma

• If there are increases in cancers as a result of irradiation of children, they would most likely appear some decades in the future. It would be prudent not to scan the head and neck,’

• the low level beam does deliver a small dose of radiation to the body but because the beam concentrates on the skin – one of the most radiation-sensitive organs of the human body – that dose may be up to 20 times higher than first estimated.

The same “anti-war” group is now actively against the use of Depleted Uranium munition in Libya. That the same individuals are closely aligned and many actively lobby for the nuclear power industry, in fact, none have come out for increased regulations even monitoring of nuclear power facilities in light of the disaster in Japan that has flooded the United States with deadly radiation brings up a point of odd contradiction to the point of hypocrisy.

However, Colonel Gaddafi also has depleted uranium munitions. Has anyone asked if he is using them? He is certainly using his cluster munitions, genuine certified Weapons of Mass Destruction, reported by Veterans Today early last month and by the mainstream press 4 days ago.

Israel is using Depleted Uranium in Gaza along with cluster munitions and white phosphorous, which causes deadly burns. That seems to be OK also, anything is OK, anywhere and by anybody as long as it isn’t against Colonel Gaddafi.

You would think Gaddafi had billions of dollars and was buying off New York and Washington wholesale. Did you know that $35 billion of the “Fed’s” bail out money went to Gaddafi personally? The Bank of Libya got that much bailout money and the Bank of Libya is Gaddafi’s personal ‘piggybank.’ 8 years ago, Gaddafi was considered a terrorist. Now he seems to have become a member of the Rothschilds family.

Imagine the friends in Washington and elsewhere that helped pull that off.

One of the more amusing things we are hearing is about how Obama is plotting to steal oil from Libya by overthrowing Gaddafi. There is real humor in this, of course. Until 2004, Gaddafi was on our “axis of evil” list. Then Gaddafi got an offer he couldn’t refuse. We offered to kiss his behind if he agreed to grease a few palms here in the US.

Gaddafi became a neocon.

This was the deal:

• Turn Libya’s oil over to British and American companies
• Turn all oil and gas exploration and equipment business over to Vice President Cheney’s company, Haliburnton
• Donate money to GOP candidates
• Donate more money to “friends” in France and Italy
• Join as a full partner in the imaginary Global War on Terror
• We will pretend we have certified your WMD programs as ended and
• You can do as you please from now on, we certainly do!

America has been in Iraq for years, is still there. Hundreds of supertankers of crude were taken from Iraq through both the Gulf, Basra Lite and the ports south of Ceyhan, Kirkuk Lite. No one counted, no one checked, they just loaded it up, took it to refineries and sold it to the American people as though they had paid real money for it. It was paid for all right, 5000 Americans died fighting in Iraq and 3000 more were murdered on 9/11. They paid for the oil, have no doubt about that.

What kind of threat is Obama making against Libyan oil?

His real threat, if you have been paying attention, is to end Republican Party control of Libyan oil. Other than defending Gaddafi at any cost, how are the GOP geniuses planning to save America?

They are learning to use photoshop:

YOU WOULD THINK EVEN GADDAFI COULD FIND BETTER FRIENDS THAN THE FOLKS WHO DID THIS

Gordon Duff is a Marine Vietnam veteran. A 100% disabled vet. He has been a featured commentator on TV and radio including Al Jazeera and his articles have been carried by news services around the world. He has been a UN Diplomat, defense contractor and is a widely published expert on military and defense issues. Duff is Senior Editor at one of the most widely read Veterans Online publications Veterans Today

Read more

• GORDON DUFF: PRESIDENT OBAMA, “GET REAL” ON 9/11 AND PHONY TERROR

• GORDON DUFF : ENOUGH IS ENOUGH, IS AMERICA WORTH DEFENDING?

Diagnosis Negative: Severe case of debt, contagion risk high

Ron Paul: Spending Cuts Are Meaningless Without Transparency Into The Shadow U.S. Government Run By The Federal Reserve

http://tinyurl.com/3ntoanq

Video - Texas Straight Talk - April 18, 2011

AUDIT THE FED - SIGN THE PETITION

--

By Dr. Ron Paul

Congress focused on issues surrounding government spending this week as talk of deficits, the national debt, and the debt limit saturated the airwaves. This is a positive development. In years past, there was very little concern over how much was spent here in Washington, how it was spent, or how much of our gross domestic product was being consumed by government. That blissful ignorance naturally resulted in decades of government spending with impunity, bringing us to where we are today: trillions in debt with astronomical entitlement obligations that will be impossible to fulfill in the not too distant future. So it is a good thing that there is so much political pressure now on our leaders to actually put the brakes on runaway spending.

However, even the most generous estimate of the spending cut passed this week – $38.5 billion – is a paltry 3.5% of the $1.05 trillion in spending through the next 5 months. This hardly makes a dent in our government's mountain of debt. Even worse than that, the non-partisan Congressional Budget Office (CBO) stripped away the accounting sleights of hand and scored it as only $352 million in cuts, which works out to less than half of one percent of spending. Still, the tiniest cut is better than the massive increases we have become accustomed to in federal budgets.

Of course, our disastrous wars in Afghanistan and Iraq are not even included in this budget as they are considered emergency spending. They constitute $3.3 billion in spending in the same period of time, so they more than cancel out any small cuts the warmongers may crow about.

I voted against the legislation funding government for the remainder of this year, as well as next year's budget because, as in years past, government spends far too much on unconstitutional programs. In spite of any rhetoric about fiscal responsibility, a point three percent (0.3%) cut does not suddenly make the rest of the spending constitutional or responsible. And, if the American people do not continue to hold the politicians' feet to the fire, you can be sure we will see massive spending increases again in the future.

In addition to Congress' spending, many Americans are finally paying attention to the spending done by unelected banking cronies at the Federal Reserve. Recently the Fed was forced to reveal some details of loans given out during the financial crisis of 2008 and they are truly shocking. Matt Taibbi points out in a recent Rolling Stone article that two very well-connected Wall Street wives got together and formed a real estate investment company that garnered $220 million in so-called "loans" (free money) from the Fed. Compare this number to the $352 million in spending cuts the CBO says are in the current budget! A few months later, one of the wives bought a $13.5 million personal residence with her husband, the CEO of Morgan Stanley.

The unelected, unaccountable Fed hands out as much or more money this way as our federal government spends, and yet receives hardly any attention. This is why I believe transparency of the Fed is a critical step to regaining control of our financial situation in this country. We can never get meaningful reforms if all eyes are on the $352 million so-called cuts, and transactions like the $220 million given to Wall Street cronies are done in the shadows. This is why I have reintroduced my Audit the Fed bill to this Congress. HR 1207 is now HR 459 and is essential to true fiscal reform and responsibility.

##

Matt Taibbi On Washington's "Shadow Budget" That Exists To Benefit Wall Street (Grazie Bernanke)

http://tinyurl.com/3ecoe25

Video - Matt Taibbi with Cenk - April, 15, 2010

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Existing Home Sales in U.S. Rise on Growing Demand for Distressed Property

Sales of U.S. previously owned homes rose in March as a mounting supply of properties in or near foreclosure lured investors.

Purchases increased 3.7 percent to a 5.1 million annual rate, exceeding the 5 million median forecast of economists surveyed by Bloomberg News, figures from the National Association of Realtors showed today in Washington. All-cash deals accounted for 35 percent of transactions, the most on record, the group said.

Unemployment, falling property values and stricter loan rules may push the number of households losing their homes to a record level this year, a sign the market will take time to recover. Even with last month’s gains, housing may remain a weak component in the economic recovery that began in June 2009.

“We continue to just tread water along the bottom,” said John Herrmann, a senior fixed-income strategist at State Street Global Markets LLC in Boston. “The housing market is fairly depressed. We think home prices will fall further.”

Stocks climbed as sales at companies from Intel Corp. to Yahoo! Inc. exceeded estimates and commodity producers gained. The Standard & Poor’s 500 Index rose 1.3 percent to 1,329.69 at 12:37 p.m. in New York.

Estimates for March existing home sales ranged from 4.59 million to 5.4 million, according to the median of 74 forecasts in the Bloomberg survey.

Paying Cash

The share of all-cash transactions is the highest since monthly tracking began in August 2008, Lawrence Yun, chief economist at the Realtors’ association, said at a news conference today in Washington. Yearly figures before 2008 showed the share at about 10 percent, Yun said.

Distressed properties, which include foreclosures and short sales, accounted for 40 percent of all deals last month, according to Yun. Purchases by investors climbed to 22 percent of transactions last month, up from 19 percent in February.

“This is part of the cleansing process that needs to occur,” Yun said, referring to distressed sales. “Home sales are strongest in the very-low price range” of less than $100,000, he said, reflecting the increase in demand by investors paying in cash.

Sales rose in three of four U.S. regions in March, led by an 8.2 percent gain in the South. The West fell 0.8 percent.

The median sales price fell 5.9 percent from March 2010 to $159,600 last month as less-expensive properties became a bigger share of the market. Sales of houses priced at $100,000 or less were up 9.6 percent from March 2010, compared with a 6.3 percent drop for the market as a whole, the report showed.

More Supply

The number of previously owned homes for sale climbed to 3.55 million. At the current sales pace, it would take 8.4 months to sell those houses compared with 8.5 at the end of the prior month. Supply in the eight months to nine months range is consistent with stable home prices, the group has said.

Federal Reserve officials, in a statement following their March 15 monetary policy meeting, said that while the “economic recovery is on a firmer footing,” residential real estate is still “depressed.” The central-bank committee is scheduled to next meet April 26-27 in Washington.

Home prices dropped in the 12 months to January by the most in more than a year, according to the S&P/Case-Shiller index of home values. In 20 cities, prices fell 3.1 percent, the biggest year-over-year decrease since December 2009, the group said March 29.

Foreclosures

Some underlying home values are less than the mortgages on the properties. CoreLogic Inc. last month estimated that about 1.8 million homes were delinquent or in foreclosure, a so-called “shadow inventory” set to add to the 3.5 million existing homes already on the market.

Cheaper homes and distressed properties are making homebuilders pessimistic. Builders overall are not optimistic. The National Association of Home Builders’ confidence fell to 16 this month, according to the group’s gauge released this week. A reading under 50 means a majority of builders view conditions as poor.

KB Home, the Los Angeles-based homebuilder that targets first-time buyers, this month reported a bigger-than-expected loss for the quarter ended Feb. 28 as orders plunged.

“We do not anticipate a net profit for 2011,” Chief Executive Officer Jeffrey Mezger said during a conference call with analysts on April 5. “The economy is continuing to improve. Even so, this recovery has yet to include significant job growth and has not spilled over into housing.”

Warning Signs of a Coming Currency Crisis

Dees Illustration

Greg Hunter
USA Watchdog

Gold hit an all-time high this week—again. The yellow metal briefly topped $1,500 an ounce before falling back down a few dollars. The world has become increasing nervous about the size of the growing U.S. debt. Just this week, America’s debt topped $14.3 trillion (also an all-time high) which is close to the limit Congress can legally borrow. A recent CNSNews.com report shows why the $38 billion, that was just cut, is a drop in the budgetary bucket. The report said, “Friday’s $34.54-billion jump in the national debt almost equaled the $38.5 billion the Republican House leadership said would be cut from spending for the remainder of this fiscal year by the continuing resolution that the Congress passed on Thursday and President Obama signed Friday. The federal government is now perilously close to hitting its legal limit on debt.” (Click here for the complete CNSNews.com story.) Odds are the debt ceiling will be raised by more than $1 trillion. Meanwhile, the Fed is printing more than $75 billion a month to finance 70% of the U.S. budget. The math of this screams currency crisis 2011!

Even key members of the Fed are openly worried about America’s sea of red ink. A few weeks ago, Dallas Federal Reserve Bank President Richard Fisher said, “If we continue down on the path on which the fiscal authorities put us, we will become insolvent, the question is when . . . I look at this as a tipping point.” (Click here to read the complete story from CNBC.) Mr. Fisher said we are just at the beginning of correcting our budget problems and “it’s going to be very painful.” What do you bet “painful” will mean forced budget cuts and high inflation.

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