Sunday, November 29, 2009

Dubai debt woes may hit US property market

Cloudy future? Heavy fog rolls by early in the morning near the Dubai Marina. — Reuters pic

NEW YORK, Nov 28 — Dubai’s debt woes could further unhinge an already fragile US commercial real estate, as it illustrates the importance of that tiny country to global investors in an increasingly interconnected world.

A state-owned investment conglomerate Dubai World, with US$59 billion (RM200 billion) of liabilities, set off a global stock market selloff this week after it said it wants to restructure its debt, including at its property subsidiary Nakheel.

“This downturn has had more of a global impact,” said Tony Ciochetti, chairman of Massachusetts Institute of Technology’s Center for Real Estate in Cambridge, Massachusetts.

“As I try to explain to my students, with a global economy, we’re all attached at the hip financially in some way, shape or form,” he added.

The Dubai news also cast doubt over the strength of the fledgling US economic recovery, and the prospects for a bottoming of property prices.

Yesterday alone, the Dow Jones US Real Estate Index fell 2.9 per cent, nearly twice the decline of broader US market indexes.

“Dubai may have to unload some very prestigious properties at distressed prices and this will drive the price of all commercial real estate lower,” wrote Richard Bove, a banking analyst at Rochdale Securities in Lutz, Florida.


In the United States, Dubai World’s portfolio includes several well-known properties, and the fallout could have a larger impact on the entire real estate market.

The company is a partner with casino operator MGM Mirage in the US$8.5 billion CityCentre project, which would add 6,000 rooms to a Las Vegas Strip gambling corridor already saturated with unoccupied hotel rooms.

Nakheel, perhaps best known as the developer of Dubai’s palm-shaped islands, also carries the Mandarin Oriental and W hotels in New York in its portfolio, and has a 50 per cent stake in the Fontainebleau Miami Beach resort.

And, through its Istithmar affiliate, Dubai World controls the upscale retailer Barneys New York Inc.

The main threat to US commercial property from Dubai World woes may be “potential for contagion,” said Sam Chandan, chief economist at Real Estate Econometrics LLC in New York.

“It has the potential to spill over into the broader perception of real estate development and real estate as being a very risky area for exposure,” Chandan said.

Many have already been burned.

US commercial real estate values have already fallen 42.9 per cent from their 2007 peak, Moody’s Investors Service said.

Last month, delinquencies on US commercial real estate loans that were packaged into commercial mortgage-backed securities reached 4.8 per cent, more than six times the year earlier level, according to Trepp LLC in New York.

In a November 23 report, Moody’s analyst Nick Levidy said prices could bottom at 45 per cent to 55 per cent below their peak, implying an additional 5 per cent to 28 per cent decline, but in a “stress case” could drop 65 per cent from their peak.


Like US investors, foreign investors were enticed through much of this decade to buy US real estate aided by cheap credit and the hope that property prices would steadily rise for a long time.

Currency fluctuations also provided a boost.

And the US dollar lost about one-third of its value against a basket of currencies since late 2002, making it easier for foreign investors to scoop up US real estate even when valuations grew too rich for investors at home.

Dubai World’s holdings go far beyond real estate. It has a 20 per cent stake in Canada’s Cirque du Soleil, and also invests in the global bank Standard Chartered Plc and New York boutique investment bank Perella Weinberg Partners.

Other investments go farther afield — or under water. Dubai World is suing a former executive in a case arising from a wayward foray into submarine financing.

But Ciochetti suggested it is premature to quantify Dubai World’s impact on US commercial real estate.

“It is hard to focus on any one particular participant and then generalise about the whole market,” he said. “It illustrates that very few places and participants in the commercial real estate market are totally exempt from the global economic crisis.” — Reuters

How the Bank of England made £62bn 'disappear'

How easy is it to hide £62 billion? That is the question that has been flummoxing the City today. For it transpires that last autumn, to the almost complete ignorance of most of the City (and, I admit, most of the journalists who, like myself, keep a pretty close eye on the UK economy), the Bank of England lent a staggering amount of cash to Royal Bank of Scotland and HBOS.

I was dumbfounded when I found out. Not because there was any surprise about RBS or HBOS needing the cash – we know now from the fact that they had to be semi-nationalised. In the event, as Paul Tucker admitted at the Treasury Select Committee, the £61.6bn (it was actually a moving sum, and peaked at this level around 17 October) was only good to buy them time, in HBOS’s case for a snap merger, in RBS’s for nationalisation. We knew that they and most of the other British banks were in dire straits.

No, the reason I was surprised is that it ought not to be so easy to hide such an enormous loan from the general public. This was not merely my conclusion: the Northern Rock episode (with the details of its emergency loan being leaked to the BBC) had convinced some in authority, and some in the Bank, that it was nigh on impossible to get away with a properly covert lender of last resort operation in the modern world, with 24 hour news, markets that are extremely sophisticated and a democracy that demands instant disclosure. How wrong we all were.

This is an important issue for all of us. For a period of time in late ‘08 and early ‘09, British taxpayers’ cash was at a significant risk (although the money lent out by the Bank was not backed up by its own debt so this was rather more like quantitative easing than Government debt). But hardly anyone in Government, Parliament, the City or the general public had a clue. For the conspiracy theorists out there this information will prove extremely worrying (or exciting, depending on whether these things make you tick).

But none of this answers the question of how the Bank managed to keep the details a secret. Although those I have spoken to about it today are painfully tight-lipped about the whole thing (as one would expect), I have a few hunches about where they squirrelled away these numbers.

The first thing to remember that in the wake of the Northern Rock fiasco the Government enacted a number of laws which allowed the Bank to withhold certain information about the constitutent parts of its balance sheet if it judged that this would help it improve financial stability. This meant that it could legally be rather more discrete about where in the balance sheet these sums would show up. However, as it pointed out in its Annual Report last year, it is still obliged to disclose the overall picture of its balance sheet, and this would not be complete without including the £61.6bn of cash it lent to these two banks. The money could not simply disappear into a black hole of its own making.The first thing to remember that in the wake of the Northern Rock fiasco the Government enacted a number of laws

The likelihood instead is that it was helped in its effort to disguise the cash by the fact that there was an awful lot else going on with its balance sheet at that particular time. Whereas Northern Rock occurred before the crisis had reached a fever pitch, these loans happened when central banks around the world were doing everything they could to stem the pain in financial markets. Among those measures were special currency swap operations in which the Bank swapped cash with the Federal Reserve and the European Central Bank. These operations helped swell the Bank’s balance sheet.

In order to hide the emergency loan, all it had to do was, when printing the details of its balance sheet, to plop the loans in the same category as these currency swaps. Voila, no-one could be sure that all that fizzing in the Bank’s accounts wasn’t just due to those volatile currency swaps.

You can see the results in these graphs, which show the make-up of the balance sheet in recent years.


I’ve used my elementary Photoshop skills to add those blue lines that mark where the emergency loans for the banks began and ended. Look at the right hand graph – the assets side of the balance sheet – and in particular the purple bit that denotes “other assets”. That includes the currency swaps and, according to Simon Ward of Henderson (the City’s big expert on these complex central bank balance sheets), most likely the emergency loans as well. And, indeed, note how there is a pretty big bulge between October 08 and late January 09 – the precise period when the loans were being issued.

So the answer is that hiding this much money is actually pretty damn easy when there’s all manner of financial chaos going on. It is a finding that will definitely cheer the Bank of England, which rather likes the idea that it can step in and save a bank without anyone finding out and causing another Northern Rock. Not that RBS or HBOS ended up in a much better state in the end, but that’s another story.

Incidentally, as a footnote I should add that this deduction is the author’s own and not from the Bank of England themselves: they have been as evasive as possible when it comes to this, which given the circumstances is pretty understandable.

The Gasification of Indiana

When the Indiana Gasification plant was first proposed for Rockport by the Daniels administration in November 2006, the price of natural gas was on the rise at around $9/mmbtu. Suddenly taking coal's hydrocarbons and converting them to usable "syngas" seemed to make sense, at least until you got to the details.

That is presumably why the legislature passed a law telling the state's gas utilities that they had to negotiate thirty year contracts with Indiana Gasification on a "take or pay" basis that forced Indiana ratepayers to use syngas no matter what the cost.

Then, Indiana Gasification trotted before the Indiana utility Regulatory Commission with their proposal while negotiations were taking place. Sadly for them, the utilities soon discovered that even with prices for natural gas on the rise, that the required price for syngas was just too high to be competitive with even volatile natural gas, which by early 2008 had risen to $13.

The something big happened. New drilling technology, called hydro fracturing quickly developed for securing natural gas. The result was huge "discoveries" of natural gas in both the west and the eastern regions of the US.

Gas producers found they could produce nearly unlimited supplies of natural gas if the price remained somewhere between $4 and $5/mmbtu.

Indiana Gasification had a problem. The cost just to produce their inferior "syngas" which ultimately emits far more CO2 than natural gas when consumed was at least 50% higher than natural gas and that price did not include capturing and sequestering the enormous carbon emissions the use of coal as feedstock cause or retiring any of the massive multi billion dollar debt to build such a facility.

Indiana gas utilities ultimately walked away from the venture and soon thereafter, Indiana Gasification withdrew their IURC petition knowing they had another plan.

In short order, IG had secured support from State Rep, Russ Stilwell and Senator, Brandt Hershman for a bill that more resembled the business model of communist China than the US.

Since they could not gain utility approval for their project, they decided that legislative fiat forcing the State to purchase their more expensive syngas was in order. Our pro coal legislature readily agreed with a measure that puts the state in the business of buying all the syngas output of the plant and forces gas utilities to pass it along to Hoosier gas customers, who would then pay a hefty premium for the privilege of using coal derived gas instead of natural gas.

But IG was not done with the financial screw they were inserting into the public trough. They also sought to incur nearly zero risk in their project by securing a “loan guarantee” from the federal government so that they were protected both from the risk of building an ill fated venture as well as forcing Indiana customers to buy their product at a premium.

On December 3, the US Department of Energy is holding a hearing in Rockport (pop. 2068), a community that already emits more toxic pollution that New York, Atlanta, Chicago, Pittsburgh, Philadelphia, Indianapolis, Seattle, Los Angeles and San Diego, (pop.34 million) combined. The purpose of the hearing is to take public comment on what should be included in the Environmental Impact Statement required before the Federal Government issues the dubious loan guarantee.

So here we have a company that wishes to take zero risk to develop a technology that has never been competitive since its first use in the 19th Century. They want to do it in one of the most polluted small towns in America and of course they hope to make millions for themselves on the backs of Hoosier gas customers who will pay considerably more for their product than the “free market” would allow.

The sad thing is that this is being done with the blessings of state politicians like Mitch Daniels who like to call themselves conservatives and oppose any sort of effort to help clean, renewable energy by saying those sources should make it in the private sector instead of relying on what they call “socialized” energy.

There is obviously something terribly wrong with this picture.

Unfortunately, citizens remain n the dark as to what exactly is being proposed. IG has yet to file a construction permit application with IDEM and a Freedom of Information Act request that Valley Watch and Sierra Club filed with DOE in back in June regarding IG’s loan guarantee application has gone unanswered although DOE is required by Federal Law to respond within ten working days.

We suspect the secrecy is due to the fact that both DOE and IG know that this project is not viable economically unless they can find a “patsy” like the state of Indiana to take their risk for them.

However, several groups are determined to keep this atrocity from happening. Valley Watch, Sierra Club, Citizens Action Coalition and a newly formed Spencer County Citizens for Quality of Life are and will continue to stand in their way, in an effort to bring both environmental and health justice to the region as well continually seeking to hold a line on rates Hoosiers must pay for their electricity and gas.

Please join us by contacting us at:

John Blair is a Pulitzer Prize winning photographer who serves as president of the environmental health advocacy group Valley Watch in Evansville, IN. He is a contributor to Red State Rebels: Tales of Grassroots Resistance from the Heartland, edited by Jeffrey St. Clair and Joshua Frank. (AK Press) His email address is

Audit would hurt US economic prospects, says Bernanke

WASHINGTON, Nov 28 — Federal Reserve Chairman Ben Bernanke said yesterday congressional proposals to audit the Fed and strip it of regulatory powers as part of post-crisis reforms could damage prospects for economic and financial health in the future.

“These measures are very much out of step with the global consensus on the appropriate role of central banks, and they would seriously impair the prospects for economic and financial stability in the United States,” Bernanke wrote in a column posted on the Washington Post’s website.

The rare newspaper column by a Fed chairman comes shortly before Bernanke testifies before a Senate panel on his re-nomination to serve a second four-year term at the helm of the central bank and answers a series of steps on Capitol Hill that could diminish the central bank’s role.

Lawmakers are angry with the Fed over its emergency bailouts of major financial firms and its failure to prevent the contagion of mortgage delinquencies that crashed the financial system. A proposal to audit the Fed’s monetary policy deliberations won a committee vote recently over the objections of House Financial Services Committee Chairman Barney Frank.

Frank’s Senate counterpart, Banking Committee Chairman Christopher Dodd, is himself the author of a proposal to consign the Fed solely to making decisions about setting benchmark interest rates.

Bernanke, in his column, conceded the Fed had missed some of the riskiest behavior in the lead up to the crisis. But he said the Fed had helped avoid an even more damaging economic meltdown and has stepped up its policing of the financial system.

“The Fed played a major part in arresting the crisis, and we should be seeking to preserve, not degrade, the institution’s ability to foster financial stability and to promote economic recovery without inflation,” he said.

Bernanke acknowledged that lawmakers are responding to public anger over the government’s response to the turmoil.

“The Federal Reserve, like other regulators around the world, did not do all that it could have to constrain excessive risk-taking in the financial sector in the period leading up to the crisis,” he said.

However, the central bank has moved “aggressively” to fix the problems, Bernanke said. The Fed’s knowledge of complex financial institutions is invaluable in supervising them, he said.

The Fed’s ability to slash interest rates to combat a recession without fuelling inflation depends on its political independence he said. Allowing audits of its monetary policy — as proposed legislation would do — would increase the perceived influence of Congress on interest rate decisions, he said.

That, in turn “would undermine the confidence the public and the markets have in the Fed to act in the long-term economic interest of the nation,” Bernanke wrote.

Frank has said the audit provision is likely to be revisited as legislation winds through both houses of Congress.

Dodd has said his proposal is a starting point for debate. — Reuters

Tax Court Awards $323k in Attorneys' Fees to Two Kersting Tax Shelter Investors Because of IRS Misconduct

The Tax Court on Wednesday awarded $322,693 in attorneys' fees (after a 33.3% reduction for "overlawyering") and $15,290 in expenses under § 6673(a)(2)(B) to two Kersting tax shelter investors (Kersting v. Commissioner, T.C. Memo. 1999-197 (June 17, 1999)) for expenses incurred during the remand proceedings stemming from IRS misconduct. Hongsermeier v. Commissioner, T.C. Memo. 2009-273 (Nov. 25, 2009). Prior TaxProf Blog coverage:

Three Trillion Dollars

The Hidden Cost of War

In 2003 Donald Rumsfeld estimated a war with Iraq would cost $60 billion. Five years later, the cost of Iraq war operations is over 10 times that figure. So what's behind the ballooning dollar signs? Joseph E. Stiglitz and Linda J. Bilme's exhaustedly researched book, "The Three Trillion Dollar War: The True Cost of the Iraq Conflict," breaks down the price tag, from current debts to the unseen costs we'll pay for years to come.

Video Posted November 27, 2009

Time to Stick the Knife In

K, time to stick the knife in.

In two recent posts, "Remarkably Naïve" and "Economists: Wrong Again," I derided claims by Paul Krugman and other economists with a dilettante's knowledge of how financial markets work that low yields on U.S. government bonds "can be seen as validation of Washington's aggressive policy of spending and borrowing to 'rescue' the crisis-hit U.S. economy."

For another (almost real time) example of the spuriousness of such logic, I present the following snippet from a report in today's New York Times, "Dubai Debt Woes Raise Fear of Wider Problem" [italics mine]:

For now, most of the pain from Dubai is being felt by the holders of the Islamic bonds of Nakheel, the developer owned by Dubai World that is known for the palm-themed islands it built.

On Dec. 14, $3.52 billion in Nakheel bonds come due. One of the largest Islamic group of bonds issued, the deal was snapped up by Western and regional investors. In a reflection of how sure investors were that Dubai would meet these payments, the bonds were trading at a 10 percent premium to face value earlier this week. They are now trading at around half of face value.

For the sake of your fellow men (and women), l kindly request that economists -- Nobel prize winners or otherwise -- keep their ignorance about financial markets (and whatever other ivory tower nonsense about how the world works they've acquired through the years) to themselves.

More on this topic (What's this?)
406 Days Until This Market Crashes…

China Losses Inevitable as Dollar Weakens, Ex-PBOC Adviser Says

Nov. 26 (Bloomberg) -- China’s foreign-exchange reserves face a “triple whammy” as inflation, oversupply and the “inevitable” decline of the dollar threaten to erode the value of its holdings of U.S. Treasuries, said Yu Yongding, a former adviser to the Chinese central bank.

China needs to divert its trade and investment surpluses away from U.S. debt if it is unable to reduce them, Yu, a member of the central bank’s monetary policy committee from 2004 to 2006, said in a speech in Melbourne last night. The nation, with the world’s largest foreign-exchange reserves of $2.3 trillion, is the U.S.’s biggest creditor, holding $798.9 billion of Treasuries as of September.

“Capital losses -- let alone obtaining decent returns -- seem inevitable,” said Yu, a member of the Chinese Academy of Social Sciences. “There is no question whatsoever that the U.S. dollar will go south, which started in April 2002 and, after a short interval, restarted in March 2009.”

The dollar traded near a 14-year low against the yen as the Federal Reserve signaled it will tolerate a weaker greenback and Russia’s central bank announced plans to add Canadian dollars to its reserves to reduce its reliance on the U.S. currency. Russia, holder of the world’s third-largest foreign currency reserves, and China this year suggested the world economy would perform better with an alternative reserve currency to the greenback.

A 10 percent slide in the greenback would cut the value of China’s dollar-denominated assets by about 1.5 trillion yuan ($220 billion), exceeding Chinese central government spending under the nation’s $586 billion stimulus plan, Yu said Oct. 28 at a forum in Beijing.

The U.S. dollar has declined against all 16 of the most- traded currencies this year. It traded at $1.5125 per euro as of 9:22 a.m. in Tokyo and has weakened 8.3 percent against the currency this year.

By Candice Zachariahs

US food charities overwhelmed by demand

As the holiday season begins, charities across the US are reporting unprecedented demand for food assistance. Driving the increased demand is the unemployment crisis, the charities say. They also cite state budget cuts, the foreclosure crisis, and the ineffectiveness of the federal-state food stamp program, the Supplemental Nutrition Assistance Program (SNAP).

Feeding America, a national food assistance organization, recently released details of an economic impact survey of some of its 63,000 member food charities. It found that between summer 2008 and summer 2009, demand for food assistance increased by over 30 percent nationally. Ninety-nine percent of participating charities reported an increase in demand and 92 percent witnessed an increase of newly unemployed workers seeking assistance.

Food banks and food pantries are reporting that those seeking assistance describe themselves as “middle class” or say that “never thought they would have to ask for help.”

“We’re hearing from more and more middle class who have never in their life gone to a food pantry,” Diane Doherty, director of the Illinois Hunger Coalition told the Associated Press. “They’re very, very frustrated and angry.”

Ninety-one percent of food banks report unemployment as a primary cause in rising demand, while another 79 percent report underemployment—those working short hours—as a contributing factor to increased hunger, the survey reveals. In contrast, in May 2008 43 percent of food charities reported unemployment as a critical factor, while 90 percent reported the high price of fuel and food.

The survey concludes that the nation’s food charities are not able to meet the needs of the hungry. Fifty-five percent of surveyed charities report that within the last year they have had to turn away those seeking help, and one in five did so “frequently.” Over three fourths say that they have had to reduce the quantity of food they give away, and about a third report that they did so often.

The shortfall comes in spite of a record number of volunteers and a record distribution of food between July of 2008 and July 2009. Feeding America’s network distributed 2.63 billion pounds of food in that time span, an increase of about 21 percent over the previous year.

Feeding America reported a similar 30 percent increase in demand one year ago.

The new report comes on the heels of a recent US Department of Agriculture (USDA) study revealing a record 49.1 million Americans in 17 million households lacked dependable access to adequate food in 2008—even before the full onset of the economic crisis. The Feeding America report suggests that the level of hunger in the US has risen rapidly since then. (See: A record 49 million Americans faced hunger in 2008.)

The Obama administration has responded to the mounting evidence of mass malnourishment in the US by calling on Americans “to help feed their neighbors.”

Obama will modestly increase the appropriation for the food stamp program by $4.3 billion and that for school lunches by $1.9 billion this year. These sums, which no one expects to reverse the growth in hunger and malnourishment, are minuscule compared to the trillions of dollars Obama has doled out to the finance industry and the estimated $1 trillion his proposed “surge” in Afghanistan will cost over the next ten years.

“[T]he money is just part of it,” Agriculture Secretary Tom Vilsack sanctimoniously declared. “It is important for people in communities across the country to understand that this is a problem in their community.”

Responses to the Feeding American survey from local charities make clear that the scourge of hunger has spared no region of the country. They paint a portrait of a nation in the throes of a social crisis without parallel since the Great Depression.

The Harry Chapin food bank of Fort Myers, Florida, reported that it is serving 130 percent more people than two years ago. “Most of these clients are what the media describes as the ‘new poor,’ people that never had to ask for help before,” it reports. It blamed unemployment and the inadequacy of the joint federal-state food stamp program for the increase.

“Our pantries report they are serving more ‘working’ people,” a Peoria, Illinois food charity wrote. “The problem is by the time they pay their basic bills, such as gas bill, electric, clothing, etc., there is no money left for food.”

An Oklahoma food charity reported a 50 percent increase in demand. “Our rural areas are being particularly hard hit because of plant closings, layoffs, downturn in drilling in the energy sector and crop prices,” it wrote. “People are teaching each other how to build fire pits in their back yards to cook because their utilities are turned off. Families are finding themselves needing food for the first time in their lives and our partner agencies’ resources are being stretched to their limits.”

Gleaners Community food bank of Detroit described a desperate situation. It calculates that a staggering 600,000 residents of Southeast Michigan “are believed to be at risk” of hunger, and fears that 250,000 children will go hungry next summer after the school year ends—and with it free and reduced-price lunch programs. Gleaners estimates that area charities can now feed fewer than 90,000 of these children. “To compound the crisis, in December an estimated 90,000 residents in Southeast Michigan will see their unemployment benefits expire,” it added. “The non-profit sector is asked to be the safety net for increasing numbers of people in crisis.”

Second Harvest food bank of Duluth, Minnesota said unemployment was the biggest factor in increased demand for its services. “The Iron Mines throughout Northeast Minnesota have laid of hundreds of workers,” it explained. “Duluth based companies such as an aircraft design company and those working with them have also laid off workers. Our increase is primarily unemployment and underemployment.”

A similar report came from a food charity in Maine. Describing the cause of increased hunger, it listed “Mill layoffs in Millinockett, Ashland closure, Marsadis layoffs, Baileyville layoff, Old Town layoffs, Washington County has high unemployment rate and no new jobs.”

And this from Montana: “Several lumber mills, railroads and oil refineries [have closed] since January of 2009. Many of the families displaced by the closure of those businesses are new to the emergency food system in Montana. All three industries provided decent living wages to families and have left them with nothing. Due to the vast area of our state and our relatively low population, individuals and families find it difficult to relocate or seek alternative forms of employment. It was only recently that minimum wage was raised from $6.15 to $6.90. This is what most individuals can expect to earn, if they are fortunate enough to secure employment at this time.”

A food bank in Elizabethtown Kentucky reported it was struggling to feed the hungry in its area, citing unemployment and a 66 percent falloff in corporate donations. “Agency managers report daily how their demand is increasing every day; a demand that they are not able to satisfy with the dwindling food bank product we have available to provide them,” it wrote.

Demand for food relief increased sharply in California and Nevada, where local charities coupled joblessness with the foreclosure crisis as the main culprits.

Food charities in Los Angeles and Orange country reported 30 percent increases in demand. Further down the coast in San Diego, the increase was more marked. “In Summer 2008 we served 46,000 individuals,” Feeding America San Diego wrote. “In Summer 2009 we are serving 109,822 individuals, this is a 138% growth.”

A Fresno, California, food bank saw a doubling of its clients. “We are experiencing higher than national average unemployment, nearing Depression era rates upwards of 40 percent,” it wrote. “This year a severe drought impacted the West side of Fresno County where over 600,000 acres were left fallow as a result. Thousands of our clients each week stand in line for hours at a time in triple digit weather just so they can have something to feed their families because their agriculture related jobs have disappeared and their communities lack meaningful employment alternatives.”

Las Vegas saw an increase in demand for food assistance of between 121 and 168 percent. A local charity described the situation in the following terms:

“Las Vegas has one of the highest foreclosure rates in the nation, and Nevada now has the third highest unemployment rate of all the states...Much of the housing assistance that has been passed doesn’t help homeowners here...For a family to lose a job, then not be able to pay for the mortgage, then lose the house...all these factors can be crippling to families who otherwise would be getting by...The situation is just very bad here. Unemployment continues to rise, property tax values are poised to go down (reducing revenue for county social services), the expected wave of commercial property foreclosures has yet to hit, construction will soon be finished on the last major Strip property undergoing work, there’s talk of a special State Legislative Session to cut the budget yet further.”

The Fredericksburg Area Food Bank of Virginia noted the foreclosure crisis as a prime cause of hunger, and pointed out that the Obama stimulus package had done nothing to help. “Challenges include foreclosures, unemployment, and homelessness,” it said. “Some people are just trying to keep the roof over their heads and need food to make ends meet. School just started and agencies are getting calls all the time for everything, including school supplies. Foreclosures are still very much on the rise and people are being forced into hotels and whole families, even employees, are living in one hotel room. There is no help for these people in the economic stimulus package, no one is helping these people to keep their homes.”

A New York City food charity, the Community Kitchen and Food Pantry of West Harlem, reported that 250 of the 1,000 people who come each day are first time users. “The line has grown so long that when you walk outside, it’s overwhelming,” said Jesse Taylor, senior director at the pantry, told the Associated Press. “A lot of people are coming out in suits, they’re carrying brief cases.”

Thanksgiving, a holiday associated with food bounty, saw reports from across the US of long lines outside food pantries.

Hundreds lined up at food banks in the central Washington towns of Richland and Kennewick. “If this is any indication of the volume of individuals we’ll have during Christmas, it’s going to be a real challenge,” John Neill, deputy executive director for the Tri-Cities Food Bank told the

A Hartford, Connecticut soup kitchen, Loaves and Fishes, was full ten minutes after it opened its door on Thanksgiving, with a line outside. “Everyone is feeling the effects,” Cynthia Hudson, who was at the soup kitchen with her brother, told the Hartford Courant. “It’s bad. It’s really bad on the poor.”

“We’re seeing people come in who normally wouldn’t be using our services,” said Judy Hart, Hartford coordinator for the Salvation Army. “It’s getting to a point where this is their survival.”

In west Texas, the Andrews Food Pantry was able to provide a Thanksgiving meal box for all comers. Some in nearby towns were not so fortunate.

“We have one agency that had to close because they couldn’t handle the need, they served 21 in January, and it went up to 92 in August,” Executive Director for the West Texas Food Bank, Hyta Folsom told a local news station. “Need has exploded this year.”

Woman's leg amputated by mistake following false cancer diagnosis

(NaturalNews) Word to the wise: Be careful of what doctors tell you to cut off following a cancer diagnosis. Submitting to cancer surgery can cost you an arm... or a leg.

Increasingly, cancer surgeons are recommending that woman have their healthy breasts surgically removed as a way to prevent cancer -- even when those women have no cancer! But recently, an even more bizarre story surfaced: According to a BBC report (, a UK woman had her leg amputated by a cancer surgeon who claimed her leg showed signs of a malignant cancer tumor. She naively agreed to undergo the surgery and awoke with quite a shock: Not only was her leg missing, but the doctor told her she never had cancer in the first place.

I'm trying to figure out who made the bigger goof here: The doctor who claimed there was cancer, or the patient who agreed to let a doctor amputate her leg without getting a second opinion...

Here's what the doctor reportedly said upon her regaining consciousness: "I've got a bombshell to tell you - I'm very sorry, but we shouldn't have taken the leg off."

At that point, I think the patient should have picked up that amputated leg and beat the snot out of the surgeon with it. But that's just me...

The finest medical care in the world

The leg amputation patient was offered a settlement of roughly US$158,000, much of which ended up being used to buy a prosthetic leg. This is how the medical system generates business these days: First they harm patients with one procedure (drugs, chemo or surgery), then they make even more money treating the harm they caused in the first place. It's quite a clever system for repeat business.

The Royal Orthopaedic Hospital, where this surgery took place, denied it had been negligent. (That must be some creative excuse-making.) The leg amputation was approved by "a group of clinical experts - three of them world-renowned in their particular fields," according to statements published by the BBC. (None of them lost their jobs over the incident.)

Is that a relief? It would be far more comforting to think this was a mistake made by bumbling idiots who had no idea what they were doing. But no, this leg amputation error was made by the best doctors and surgeons around! These are the smart ones!

I'd hate to think what some lesser-educated members of the medical profession might have done. Perhaps they would have resorted to the tactics of masochistic U.S. breast cancer surgeons and recommended that the women remove both legs just to make sure she never gets cancer there in the future.

And why stop at that? Chop off the arms, legs, testicles, breasts, colon and reproductive organs -- all just to make sure no cancer appears there. Soon, you're left with the Black Knight from Monty Python, a wiggling torso with an animated head that insists he's just fine and can still fight.

You gotta wonder, by the way, why this victim settled for a mere $158,000. Isn't your leg worth much more? I don't know about you, but I need both legs because there are still too many practicing cancer surgeons who need a good swift boot to the head!

Need a CT scan? Here's the "Hiroshima special..."

Oh, and just in case you think the craziness of modern health care is limited to surgeons who remove the wrong body parts, here's something else you need to know. As the LA Times reports




























































世界唯一的七星級酒店──Burj Al-Arab酒店是迪拜的地標。迪拜世界的債務違約危機,宣告了“迪拜新話”的破滅。(圖:法新社)



























倫敦Cantor Fitzgerald的全球股票首席分析家波普指出,迪拜倒債危機雖會減緩復甦力道,但不至於像雷曼兄弟倒閉引發全球股市如墜深淵,或讓經濟再次陷入衰退。

















華僑銀行財管理部副總裁Vasu Menon認為,香港上週五狂瀉4%,新加坡週一早上開盤會疲軟,可能掉2%。














李冰冰( 中) 封后情緒激動,黃渤(右)和張家輝並列影帝感言幽默。( 圖:法新社)






























金馬獎主持人陶晶瑩今年背負重任,如果超時要扣錢(4小時為上限),她一開場就走精簡風,話少 卻很中肯,指台下蘇有朋“看乖乖虎已變成大腕級演員了”,瘦身有成的她還大開美嗓唱開場《historia de un amor》,接下來各組頒獎人都遵循她的模式,致詞精簡扼要,戴立忍和張榕容幾乎沒有廢話,一上台就頒獎。得獎人也很配合,每一組都很節制,進度感覺還有 點超前。


最佳美術設計:李天爵、Patrick Dechesne、Alain-Pascal Housiaux《臉》
最佳造型設計:克利斯瓊拉夸、王佳惠、Anne Dunsford《臉》

Hundreds of icebergs drifting toward New Zealand

23 Nov 09 - More than 100, possibly hundreds, of Antarctic icebergs are floating toward New Zealand, prompting a maritime alert to ships in the south Pacific Ocean.

16 Nov 09 photo released by the Australian Antarctic Division

The alert comes three years after cold weather and favorable ocean currents brought dozens of icebergs to within 25 km (15.5 miles) of New Zealand's southern coast for the first time since 1931.

“Measuring up to 200 meters (650 feet) across and 30 yards (meters) tall, the icebergs are part of a "flotilla" of icebergs that can be seen on satellite images, said Australian glaciologist Neal Young.

“It is rare for whole icebergs to drift so far north before melting,” said this article on Yahoo, "but a cold snap around southern New Zealand and favorable ocean currents have again combined to push the towering visitors to the region intact.”

“Icebergs are formed as the ice shelf develops. Snow falls on the ice sheet and forms more ice, which flows to the edges of the floating ice shelves. Eventually, pieces around the edge break off.”

Young said that having the icebergs end up near New Zealand is not necessarily linked to global warming … and then went on to link them to global warming.

I wonder if the 1931 icebergs were also a result of global warming?
And if New Zealand becomes entirely surrounded by icebergs, will
that be even more proof of global warming? How about if all of New
Zealand's glaciers should double in size? More proof?

See entire articles:

Keiser Report: Markets! Finance! Scandal! - November 26, 2009

Click this link .....

Senator Wants to Know if the Dead Osama will be Read Miranda Rights

New Jersey Sen. Robert Menendez wants to put a dead man on trial in a U.S. civilian court. Menendez has told CNSNews that Osama bin Laden should be brought to justice and prosecuted in civilian court, where he will most certainly be convicted.

“When we catch bin Laden, should he be Mirandized? Should he be read his Miranda rights? If there’s going to be a civil proceeding, the attorney general said it wouldn’t matter,” Matt Cover of CNSNews asked Menendez.

“As far as I’m concerned he should be prosecuted, brought to justice, and hopefully – and I fully expect – convicted,” declared Menendez.

CNSNews asked the question after Sen. Lindsey Graham of South Carolina grilled Obama’s attorney general on how the administration would handle terrorists caught in the future. “If we captured bin Laden tomorrow, would he be entitled to Miranda warnings at the moment of capture?” said Graham.

Eric Holder wasn’t sure how to answer Graham’s question. He said it “all depends” if Osama bin Laden would be read his Miranda rights. Holder’s apparent confusion is rather perplexing coming from the top cop in the country.

Graham understands the law better than Obama’s attorney general. “Well, it does not depend,” Graham replied. “If you’re going to prosecute anybody in civilian court, our law is clear that the moment custodial interrogation occurs, the defendant – the criminal defendant – is entitled to a lawyer and to be informed of their right to remain silent.”

Not that Graham believes accused terrorists deserve a day in court. He believes Holder is guilty of “making bad history” in his decision to send Khalid Sheikh Mohammed and his supposed co-conspirators to New York for trial in civilian court.

“We’re making bad history here,” Graham said during a Senate Judiciary Committee hearing on November 18. “The big problem I have is that you’re criminalizing the war…. I think you’ve made a fundamental mistake here.”

Holder’s “bad history” fits in the larger context of an invented history. Khalid Sheikh Mohammed and his cohorts are prized patsies for the official 9/11 fairy tale used to launch the global war on terror and turn the United States into a surveillance and police state.

Osama bin Laden was a CIA asset who died in December, 2001. “Usama bin Laden has died a peaceful death due to an untreated lung complication, the Pakistan Observer reported, citing a Taliban leader who allegedly attended the funeral of the Al Qaeda leader,” Fox News reported on December 26, 2001. “Bin Laden, according to the source, was suffering from a serious lung complication and succumbed to the disease in mid-December, in the vicinity of the Tora Bora mountains. The source claimed that bin Laden was laid to rest honorably in his last abode and his grave was made as per his Wahabi belief.”

On October 26, 2002, CNN reported on a London-based Arab news magazine publishing Osama’s will. “He did write the will as someone saying good-bye,” Hani Nakshabandi of the Arab news magazine Al Majalla told CNN.

According to the former dictator of Pakistan, Pervez Musharraf, Osama died because he was unable to get treatment for a kidney disease. “I think now, frankly, he is dead for the reason he is a … kidney patient,” Musharraf told CNN on January 18, 2002. “I don’t know if he has been getting all that treatment in Afghanistan now. And the photographs that have been shown of him on television show him extremely weak.”

In February of 2002, CNN terrorism analyst Peter Bergen said Osama bin Laden had “aged enormously between ‘97 and October” of 2001. “This is a man who was clearly not well. I mean, as you see from these pictures here, he’s really, by December he’s looking pretty terrible.”

Dr. Sanjay Gupta, CNN medical correspondent, concurred. “You can look [at pictures from a December 2001 video] and notice that he has what some doctors refer to as sort of a frosting over of his features—his sort of grayness of beard, his paleness of skin, very gaunt sort of features. A lot of times people associate this with chronic illness. Doctors can certainly look at that and determine some clinical features…. The sort of frosting of the appearance is something that people a lot of times associate with chronic kidney failure, renal failure, certainly someone who is requiring dialysis would have that,” said Gupta on January 21, 2002.

“Of course, by the time Gupta had made his prognosis, the CIA asset bin Laden was dead and buried, as patients with chronic kidney failure do not fare well in the Afghan outback without a kidney dialysis machine, unless we are to believe Osama’s helpers ferried one in, or maybe the ISI did by way of the CIA’s Air America transport,” this correspondent wrote with a measured degree of sarcasm on September 9, 2007, after a spate of supposed Osama videos appeared, more than a few with the assistance of the SITE Institute, a documented Mossad propaganda front (SITE shares an IP address with another Israeli intelligence front, MEMRI).

In September of 2007, a revitalized Osama appeared in a video complete with a Grecian Formula makeover. The new Osama was a stark contrast to the sickly Osama and the fat Osama supposedly confessing to the 9/11 attacks in a video made public on December 13, 2001.

Hamid Karzai, the former employee of the oil company Unocal and current handpicked president of U.S. occupied Afghanistan, told CNN in October of 2002 that Osama bin Laden was “probably dead.”

“The more we don’t hear of him, and the more time passes, there is the likelihood that he probably is either dead or seriously wounded somewhere,” said Karzai seven years ago.

Dale Watson, the head of the FBI’s counter-terrorism unit, said in July of 2002 that Osama was “probably” dead. “It is thought to be the first time a senior US law-enforcement official has publicly offered an opinion on whether Bin Laden, the prime suspect believed to be behind the 11 September attacks, is dead or alive,” the BBC reported.

Israeli intelligence said Bin Laden died in the U.S. military campaign in Afghanistan in December. The Israelis went so far as to declare the purported Osama videos that have appeared since December, 2001, are fabrications.

Sen. Robert Menendez and the neocon Sen. Lindsey Graham have a vested interest in keeping the dead nemesis Osama bin Laden alive. The trial of Khalid Sheikh Mohammed will be an orchestrated and highly controlled farce that will perpetuate the contrived war on terror.

It remains to be seen if the notorious KSM will be asked about his dubious confession via waterboard, in particular his assertion that he planned the bombing of the Plaza Bank.

“Khalid Shaikh Mohammed’s alleged confession testimony has been thoroughly discredited after it emerged that one of the targets he identified, the Plaza Bank, was not founded until 2006, four years after the alleged Al-Qaeda mastermind’s arrest,” Paul Joseph Watson wrote on March 16, 2007.

by Kurt Nimmo

World Wide Military Expenditures

CountryMilitary expenditures - dollar figure Budget Period
World$1100 billion 2004 est. [see Note 4]
Rest-of-World [all but USA]$500 billion 2004 est. [see Note 4]
United States $623 billion FY08 budget [see Note 6]
China $65.0 billion 2004 [see Note 1]
Russia $50.0 billion [see Note 5]
France $45.0 billion 2005
United Kingdom $42.8 billion 2005 est.
Japan $41.75 billion 2007
Germany $35.1 billion 2003
Italy $28.2 billion 2003
South Korea $21.1 billion 2003 est.
India $19.0 billion 2005 est.
Saudi Arabia $18.0 billion 2005 est.
Australia $16.9 billion 2006
Turkey $12.2 billion 2003
Brazil $9.9 billion 2005 est.
Spain $9.9 billion 2003
Canada $9.8 billion 2003
Israel $9.4 billion FY06 [see Note 7]
Netherlands $9.4 billion 2004
Taiwan $7.9 billion 2005 est.
Mexico $6.1 billion 2005 est.
Greece $5.9 billion 2004
Singapore $5.6 billion 2005
Sweden $5.5 billion 2005 est.
North Korea $5.0 billion FY02
Iran $4.3 billion 2003 est.
Pakistan $4.3 billion 2005 est.
Belgium $4.0 billion 2003
Norway $4.0 billion 2003
Chile $3.9 billion 2005 est.
Colombia $3.5 billion 2005
Poland $3.5 billion 2002
Portugal $3.5 billion 2003
South Africa $3.5 billion 2005 est.
Denmark $3.3 billion 2003
Vietnam $3.2 billion 2005
Algeria $3.0 billion 2005 est.
Kuwait $3.0 billion 2005 est. [see Note 2]
United Arab Emirates $2.7 billion 2005
Egypt $2.5 billion 2005
Malaysia $2.5 billion 2005
Switzerland $2.5 billion 2005 est.
Morocco $2.3 billion 2005 est.
Czech Republic $2.2 billion 2004
Qatar $2.2 billion 2005
Thailand $2.0 billion 2005
Angola $2.0 billion 2005 est.
Finland $1.8 billion FY98/99
Argentina $1.8 billion 2005
Venezuela $1.6 billion 2005 est.
Austria $1.5 billion FY01/02
Romania$1.5 billion 2005
Jordan $1.4 billion 2005 est.
Indonesia $1.3 billion 2004
Iraq $1.3 billion 2005 est.
Hungary $1.1 billion 2002 est.
New Zealand $1.1 billion 2005 est.
Bangladesh $1.0 billion 2005 est.
Yemen $992 million 2005 est.
Syria $858 million N/A [see Note 3]
Philippines $837 million 2005 est.
Peru $829 million 2005 est.
Nigeria $738 million 2005 est.
Ireland$700 million FY00/01
Cuba $694 million 2005 est.
Serbia and Montenegro$654 million 2002
Ecuador $650 million 2005 est.
Bahrain $628 million 2005 est.
Croatia $620 million 2004
Ukraine $618 million FY02
Sri Lanka $606 million 2003 est
Libya $590 million 2005
Sudan $587 million 2004
Lebanon $541 million 2004
Tunisia $440 million 2005
Belarus $421 million 2006
Slovakia$406 million 2002
Uruguay $371 million 2005 est.
Slovenia $370 million 2005 est.
Bulgaria $356 million FY02
Madagascar $329 million 2005 est.
Botswana $326 million 2005 est.
Azerbaijan $310 million 2005
Ethiopia $296 million 2005 est.
Brunei $291 million 2003 est.
Kenya $281 million 2005 est.
Cyprus $280 million 2005
Gabon $254 million 2005 est.
Oman $253 million 2005 est.
Cote d'Ivoire $247 million 2005 est.
Bosnia and Herzegovina $234 million FY02
Luxembourg $232 million 2003
Lithuania $231 million FY01
Cameroon $230 million 2005 est.
Kazakhstan $222 million FY02
Eritrea $220 million 2005 est.
Uganda $193 million 2005 est.
New Caledonia $192 million FY96
Dominican Republic $191 million 2005
Turkmenistan $173 million 2005
Guatemala $170 million 2005 est.
El Salvador $162 million 2005 est.
Estonia $155 million 2002 est.
Equatorial Guinea $152 million 2005 est.
Panama $150 million 2005 est.
Namibia $150 million 2005 est.
Armenia $136 million 2005
Bolivia $130 million 2005 est.
Macedonia, FYR $130 million 2005
Zimbabwe $125 million 2005 est.
Afghanistan $122 million 2005 est.
Zambia $122 million 2005 est.
Guinea $120 million 2005 est.
Senegal $117 million 2005 est.
Nepal $105 million 2005 est.
Congo, Democratic Republic of the $104 million 2005 est.
Benin $101 million 2005 est.
Latvia $87 million FY01
Congo, Republic of the $85 million 2005 est.
Ghana $84 million 2005 est.
Costa Rica $83 million 2005 est.
Mozambique $78 million 2005 est.
Burkina Faso $75 million 2005 est.
Cambodia $74 million 2005
Chad $69 million 2005 est.
Liberia $67 million 2005 est.
Trinidad and Tobago $67 million 2003
Albania $57 million FY02
Uzbekistan $55 million 2005
Rwanda $54 million 2005 est.
Honduras $53 million 2005 est.
Paraguay $53 million 2003 est.
Mali $50 million FY01
Maldives $45 million 2005 est.
Malta $45 million 2005 est.
Niger $45 million 2005 est.
Burundi $44 million 2005 est.
Swaziland $42 million FY01
Lesotho $41 million 2005 est.
Burma $39 million FY97
Fiji $36 million 2004
Tajikistan $35 million FY01
Bahamas, The $32 million 2005
Nicaragua $32 million 2005 est.
Jamaica $31 million 2003 est.
Togo $30 million 2005 est.
Djibouti $29 million 2005 est.
Haiti $26 million 2003 est.
Georgia $23 million FY00
Mongolia $23 million FY02
Somalia $22 million 2005 est.
Tanzania $21 million 2005 est.
Belize $19 million 2005 est.
Kyrgyzstan $19 million FY01
Mauritania $19 million 2005 est.
Guyana $17 million 2005
Papua New Guinea $17 million 2003
Central African Republic $16 million 2005 est.
Malawi $16 million 2005 est.
Seychelles $15 million 2005 est.
Sierra Leone $14 million 2005 est.
Comoros $13 million 2005 est.
Mauritius $12 million 2005 est.
Laos $11 million 2005 est.
Guinea-Bissau $9.5 million 2005 est.
Moldova $8.7 million 2004
Bhutan $8.3 million 2005 est.
Suriname $7.5 million 2003 est.
Cape Verde $7.2 million 2005 est.
East Timor$4.4 million FY03
Bermuda $4.0 million 2001
Gambia, The $1.6 million 2005 est.
San Marino$700,000 FY00/01
Sao Tome and Principe $580,000 2005 est.
Antigua and Barbuda$NA N/A
Barbados$NA N/A
Dominica$NA N/A
Falkland Islands [Islas Malvinas] $NA N/A
Faroe Islands$NA N/A
French Guiana$NA N/A
Gaza Strip$NA N/A
Grenada$NA N/A
Kiribati$NA N/A
Marshall Islands$NA N/A
Nauru$NA N/A
Palau$NA N/A
Saint Kitts and Nevis$NA N/A
Saint Lucia$NA N/A
Saint Vincent and the Grenadines$NA N/A
Samoa$NA N/A
Solomon Islands$NA N/A
Tonga$NA N/A
Tuvalu$NA N/A
Vanuatu$NA N/A
West Bank$NA N/A
Western Sahara$NA N/A
SOURCE [unless otherwise noted]:
  • Field Listing - Military expenditures CIA - The World Factbook 2002 -- The Military expenditures dollar figure entry gives current military expenditures in US dollars; the figure is calculated by multiplying the estimated defense spending in percentage terms by the gross domestic product (GDP) calculated on an exchange rate basis not purchasing power parity (PPP) terms. Dollar figures for military expenditures should be treated with caution because of different price patterns and accounting methods among nations, as well as wide variations in the strength of their currencies.
  • Field Listing - Military Expenditures CIA - The World Factbook 2006
  • World Military Expenditures and Arms Transfers (WMEAT) The 28th edition of "World Military Expenditures and Arms Transfers" (WMEAT), released on February 6, 2003, is the second published by the Department of State following integration with the U.S. Arms Control and Disarmament Agency, the previous publisher. The report covers the years 1989 through 1999 -- that is, the end of the Cold War and its aftermath.
  • SIPRI data on military expenditure
  • IISS - The Military Balance 2006
  • Note 1 - The officially announced figure is $24.6 billion, but actual defense spending more likely ranges from $45 billion to $85 billion for 2004
    Note 2 - Kuwait has changed its fiscal year; the above figure is for be April-March 2005.
    Note 3 - based on CIA Factbook data that may understate actual spending
    Note 4 - Non-US aggregate real expenditure on military worldwide in 2007 remained at approximately the 1998 level, about half a trillion dollars. US spending increased from about $280 billion to about $625 billion.
    Note 5 - CIA & SIPRI provide no estimates
    Note 6 - The FY2008 budget requests $481.4 billion in discretionary authority for the Department of Defense base budget, an 11.3 percent increase over the projected enacted level for fiscal 2007, for real growth of 8.6 percent; and $141.7 billion to continue the fight in the Global War on Terror (GWOT)

    The fiscal year (FY) 2004 Department of Defense (DoD) budget request was $379.9 billion in discretionary budget authority -- $15.3 billion above FY 2003. The fiscal 2004 National Defense Authorization Act, passed by Congress 07 November 2003, authorizes DoD to spend $401.3 billion. The fiscal 2004 Defense Appropriations Act, which actually provides the money, became law 30 September 2003.

    On April 16, 2003 President Bush signed the FY2003 $79 billion wartime supplemental to cover the needs directly arising from Operation Iraqi Freedom and the reconstruction of Iraq. The Defense Department received $62.6 billion as a result of the emergency supplemental bill.

    On Nov. 6, 2003 President Bush signed the FY2004 $87.5 billion supplemental appropriations bill for military operations in Iraq and Afghanistan. The bill provides $64.7 billion for military operations in Iraq, in Afghanistan and elsewhere, including about $51 billion is for Operation Iraqi Freedom, and $10 billion for Operation Enduring Freedom. The remaining $22.8 billion in non-DOD monies will cover costs with Operation Noble Eagle and support for allies in the war on terror.
    Note 7 - 2006, $7.2 B national budget + $2.2B US assistance