Wednesday, January 19, 2011

2011 Financial Meltdown Fast Approaching

Despite the best efforts by the American mainstream financial media, the eager PR division of the United States Dollar Ponzi Scheme, to paint the rosiest of rosy pictures for blindly optimistic readers, the stubborn image of a debt-swollen jobless behemoth economy slowly toppling persists. No matter how much U.S. departmental data is primped, polished, and primed, no amount of lipstick is going to transform this fat pig into a princess.

This week’s top harbinger headline points to the fact that the United States is once again bumping its fat head on the ceiling of its spectacularly stratospheric debt ceiling of $14.3 TRILLION dollars. That means an act of congress is once again necessary to lift that limit. The alternative is either a) a revaluation of the U.S. Dollar to reflect the depreciation inherent in Quantitative Sleazing as part of a debt restructuring, or b) default.

Default? Could it be?

Never, according to bright-eyed Harvard educated economists and Forexperts.

“The likelihood of a restructuring of US sovereign debt is zero,” says MF global currency and fixed income analyst Jessica Hoversen. “As for a downgrade, while it’s theoretically possible, it is still extraordinarily unlikely.”

Well that’s one opinion.

The U.S. is Smoking Crack
The rate at which U.S. debt is growing is well beyond what it could repay, even if the economy were to start growing at 10% per year. That’s because the rate of U.S. debt growth in the last 3 years is well over that figure, and since 2002, the debt has more than doubled.

This is the mathematical certainty that is assiduously kept out the press by accommodating editorial boards.

Lets try to sift through the contradictory headlines and see if we can’t discern something a little more reminiscent of reality.

First off, the United States Federal Reserve, apparently a private corporation whose self-declared mandate is to be “the central bank of the United States, that provides the nation with a safe, flexible, and stable monetary and financial system”, has been “buying” Treasury bills, the source of U.S. monetary supply, at the rate of, on average, $75 Billion a month.

But that process has resulted in the Fed being exposed in no insignificant way to major losses from credit exposure. But Ben Bernanke, the Fed’s embattled leader, suggested last week that the risks were minimal, because “if the liabilities on the Fed’s balance sheet were to exceed its assets, it would only be so because of rising interest rates in the context of a thriving economy.”

Huh? What kind of pie-in-the-sky theoretical postulation is that?

According to a Reuters article earlier today:

“..the Fed’s newfangled policy steps and the potential for credit losses raises, for some experts, the prospect that the Treasury may actually be forced to ‘recapitalize’ the Fed — economist-speak for what others might call a bail-out.”

Bottom line: The Fed, who capitalizes the treasury by buying treasury bills, now needs to be ‘recapitalized’ by the treasury, who will now write cheques to the Fed, so it can continue to write cheques to the Treasury.

This is no oversimplification – this is reality.

The Fed is broke, and so is the Treasury. The ability of the Fed to ‘stimulate’ the economy in such a condition does not exist. If the only way to inject capital into the asset-stimulating portion of the economy is to encumber the current account of the same economy with an exponentially greater quantity of debt, the result can only be, at some point, default. Somebody needs to stand up and admit that these two lines, debt growth and economic recovery, are permanently divergent, and the economist-generated stipulation that they can one day cross in a self-fulfilling prophetic law of delusional economic prophecy is preposterous. That is one of the events that is pushing the U.S. towards financial annihalation. That will be the primary catalyist in triggering the 2011 financial crisis.

China is Smoking Opium
Even after the horrible catastrophe of the 2008 financial meltdown, exacerbated by opportunistic banks attacking each other in a global cartel-induced moment of weakness, China emerged as the economic juggernaut that was indestructible. Why, even for 2011, the International Monetary Fund pegs China’s growth at 10.5%.

But just as the U.S. puffs and puffs away at its crack pipe burning U.S. dollars, the drug of choice and path to ruin for the United States economy, so China deeply inhales at regular intervals its own pipe carved from jade and stuffed full of smouldering yuan. In fact, China is so confident in the unassailable virtue of its centralist and therefore free-of-political-interference monetary policy that it positions itself increasingly as global economic grandfather. It generously subscribes to the debt auctions of economically hobbled nations like Greece and Portugal, Ireland and Spain, while doling out paternal advice and admonishments to the U.S. and Europe.

But just how sound is China’s future?

No at all sound, if Mark Harte of Corriente Advisors in the United States is to be believed. He is the American hedge fund manager who made millions predicting the sub-prime crisis and the European sovereign debt crisis. His new fund is betting that China’s economic machine may be showing signs of seizing up, and he’s definitely not alone.

Last week, Lombard Street Research put out a note warning of China’s “already dangerously home-grown inflation”.

Corriente Advisors stated, “We expect the economic fallout from a slowdown of China’s unsustainable levels of credit and growth to be as extraordinary as China’s economic outperformance over the past decade.”

Whole cities are vacant in areas of China, built on credit that has yet to be repaid, and in the expectation that the massive migration of rural residents to gleaming new cities would continue. But house prices remain out-of-reach for most Chinese, averaging 22 times disposable income in Beijing alone.

According to one analyst, Chinese banks have lent US$1.7 trillion to local state entities that are not themselves commercially viable, and who have use inflated land and real estate values as collateral.

Sound familiar? These are the exact conditions that existed in the United States real estate market just before the bubble burst in 2008.

If China growth were to slow to just 5%, commodity prices for coal, copper, steel and cement would plummet by as much as 20%, according to one study.

Gold is now under fresh assault by the biggest banks who successfully lobbied for the defeat of position limits in both the gold and silver derivative markets. Now free to build up the huge short positions against gold and silver that have to date been the source of most of the negative pressure on those monetary metals’ prices since 2000, the prices of both have descended to new monthly lows.

Consider that a gift. With the sheer scale and scope of the next economic collapse threatening to dwarf that of 2008, holders of gold and silver will be in a much better position to whether the imminent tempest far better than holders of U.S. dollars or Chinese yuan.

MidasLetter Premium Edition identifies 5 stocks on the first Sunday of each month from the TSX Venture Exchange that are expected to double within 12 to 18 months, 9 out of 10 times. Subscribe now for $49 per month, or $499 for one year, at 30 day instant refund period from your first subscription day if not 100% satisfied.

Neighboring states gleeful over Ill. tax increase

SPRINGFIELD, Ill. – While many states consider boosting their economies with tax cuts, Illinois officials are betting on the opposite tactic: dramatically raising taxes to resolve a budget crisis that threatened to cripple state government.

Neighboring states gleefully plotted Wednesday to take advantage of what they consider a major economic blunder and lure business away from Illinois.

"It's like living next door to `The Simpsons' — you know, the dysfunctional family down the block," Indiana Gov. Mitch Daniels said in an interview on Chicago's WLS-AM.

But economic experts scoffed at images of highways packed with moving vans as businesses leave Illinois. Income taxes are just one piece of the puzzle when businesses decide where to locate or expand, they said, and states should be cooperating instead trying to poach jobs from one another.

"The idea of competing on state tax rates is . . . hopelessly out of date," said Ed Morrison, economic policy advisor at the Purdue Center for Regional Development. "It demonstrates that political leadership is really out of step with what the global competitive realities are."

By going where no other state dares to tread, Illinois could prove itself to be a policy pacesetter or the opposite — a place so dysfunctional that officials created a jaw-dropping budget crisis and then tried to fix it by knee-capping the economy.

Illinois faced a budget deficit of $15 billion in the coming year, equivalent to more than half the state's general fund. Officials warned that state government might not be able to pay its employees. It certainly would fall further behind in paying the businesses, charities and schools that provide services on the state's behalf.

Read Full Article

Home price drops exceed Great Depression: Zillow

Home prices fell for the 53rd consecutive month in November, taking the decline past that of the Great Depression for the first time in the prolonged housing slump, according to Zillow.

Home prices have fallen 26 percent since their peak in 2006, exceeding the 25.9 percent drop registered in the five years between 1928 and 1933, the housing data company said in a report on Monday. Prices fell 0.8 percent over the month.

It is a dubious milestone for the U.S. housing market which has failed to gain much traction despite a host of government programs to reduce delinquencies and encourage demand with temporary tax credits and lower interest rates. Many economists expect further price drops, even if there are some anecdotal signs of growing demand, such as in pending home sales data.

"For the next six to nine months, the larger factors affecting the housing market that will produce more home price declines will be the excess inventory of homes, high negative equity and foreclosure rates, and weakened demand due to elevated employment, Stan Humphries, Zillow's chief economist, said in a blog post.

Read Full Article

JPMorgan's 2010 "record profits...evidence of a broad-based economic recovery...

"JPMorgan Chase’s profit report for 2010, released Friday, has become the occasion for a celebration by the American plutocracy of the return of the good old days before the Wall Street crash of 2008.

"Jamie Dimon, JPMorgan’s CEO, summed up the general mood of the financial elite when he declared the bank’s record profits to be evidence of a 'broad-based economic recovery,' adding, 'I think the future is extremely bright.'

"The very fact that Dimon can speak this way in the midst of the worst social crisis since the Great Depression without any repercussions from the government or the media is an expression of the immensity of the chasm separating the modern-day aristocrats from the people.

Read on here if you want more of the definition of arrogant disconnect...

« TARP Watchdog Report: Decision to bailout Citigroup was 'based on gut instinct and fear of the unknown' and NOT on any objective criteria »

New Citigroup story from ProPublica based on Barofsky's TARP report released last week, which we covered in this piece...

Related links...

Complete story below.


By Marian Wang

Source - Propublica

The government’s decision to bail out Citigroup during the financial crisis was made in a “strikingly ad hoc” manner—based on “gut instinct and fear of the unknown” and not on any objective criteria, according to a government watchdog report [PDF] released Thursday.

While the 2008 bailout of Citi served to immediately stabilize the company and strengthen it long term, the bank remains “an institution that is too big, too interconnected, and too essential to the global financial system to be allowed to fail,” the report by the Special Inspector General to the TARP said.

In all, the government handed over $45 billion to shore up Citigroup during the financial crisis. The Treasury recouped its investment last month, earning a total profit of more than $12 billion. (See our Citigroup bailout page for the details.)

But despite the seeming success of its Citi bailout, the report concludes that the government’s actions created a moral hazard and further increased the existing market advantage of big financial institutions by serving as a backstop for risky behavior. From the report:

  • When the Government assured the world in 2008 that it would not let Citigroup fail, it did more than reassure troubled markets – it encouraged high-risk behavior by insulating risk takers from the consequences of failure.
  • Unless and until institutions like Citigroup can be left to suffer the full consequences of their own folly, the prospect of more bailouts will potentially fuel more bad behavior with potentially disastrous results.

The report’s findings were echoed over the weekend by a post on Washington’s Blog, a financial blog, which argued that the government’s failure to break up the big banks will hamper economic recovery and continue to encourage risk. The post pointed to a number of independent economists and financial experts who have spoken similarly.

The Dodd-Frank financial reform bill passed last year aimed to end bailouts of large banks by giving the FDIC a framework for winding down “systemically significant” financial firms.

  • Despite these new powers, the report notes that Treasury Secretary Timothy Geithner told the report's authors that future shocks to the financial system could mean having “to do exceptional things again.”

A Citigroup spokeswoman told Bloomberg that Citi “is a fundamentally different company today.” “We have bolstered our financial strength, overhauled our risk management, reduced our risk exposures, defined a clear strategy and made Citi a more focused enterprise by returning to banking as the core of our business,” she said.


Barofsky with Neil Cavuto in November of 2010...

Video - Barofsky says that the Obama bailouts are failures of transparency...


Cattle Network Warns Farmers: Big Time Inflation Is Coming and You Better Have an Explanation

The insiders know, they see it coming. A spike in food prices is just around the corner. Here's what Drovers Cattle Network is telling farmers:
Americans have spent less than 10 percent of their disposable income on food for many years now. That’s about to change. Food prices are on the rise and there will be new records set for some, actually many goods, this year. Meat, dairy and poultry prices are among the products on pace to set records.

While the general inflation rate was nearly zero in 2010, food and fuel presents another story. Predictions for 2011 food inflation range from 3 percent to 6 percent, with some estimates in recent days pushing into the double digits.

This will come at a time when gasoline and energy prices also are on the rise—oil is projected to reach beyond $100 per barrel....Consumers will see higher prices in the supermarket and hear about record commodity prices and will perceive you as riding waves of money.
Part of this is the current supply and demand dynamics for food products, but it is also the Ben Bernanke printing press. It's going to be a perfect storm of events pushing food prices much higher. DCN is talking about 3 percent to 6 per cent inflation, but I think it will be over 10 percent. It's going to be pretty ugly out there. And some will blame the farmers. DCN is telling farmers:
News stories are already outlining this year’s higher food prices. In recent days, I’ve seen coverage on ABC, NBC, cable news and a National Public Radio business show. Still, nothing drives the point home like actually feeling it in your wallet, and that is yet to come in a significant way. I believe consumers are in for some sticker shock, and they’ll wonder what the heck has happened.

They will point to “big, greedy, modern farmers.” Never mind that globally, there are 1 billion more people to feed than in the 1990s, as well as more who’ve upgraded their previous diets.

My point is with rising food costs on the horizon, consumers will again look at farmers with jaundiced view. So, polish up your talking points about the reality of farming, finances and food production today and be prepared to explain the truth to consumers in a calm, thoughtful way.
If you have a big freezer, fill it with meat right now.

Nigel Farage on 'Monster' Eurozone: Bailout Reinforcing Failure

Public backlash as UK bailed-out bank bonuses culture continues

MICHAELS: China-style dictatorship of climatologists

NASA's Hansen prefers rule by decree to fight 'global warming'

November's election made it quite clear that the people of the United States do not want to radically change our society in the name of global warming. Pretty much every close House race went to the Republicans, while the Democrats won all the Senate squeakers. The difference? The House on June 26, 2009, passed a bill limiting carbon-dioxide emissions and getting into just about every aspect of our lives. The Senate did nothing of the sort.

The nation's most prominent publicly funded climatologist is officially angry about this, blaming democracy and citing the Chinese government as the "best hope" to save the world from global warming. He also wants an economic boycott of the U.S. sufficient to bend us to China's will.

NASA laboratory head James Hansen's anti-democracy rants were published while he was on a November junket in China, but they didn't get much attention until recently. On Jan. 12, the hyperprolific blogger Marc Morano put them on his Climate Depot site, and within hours, the post went viral. In a former life, Mr. Morano was chief global-warming researcher for Sen. James M. Inhofe, Oklahoma Republican.

According to Mr. Hansen, compared to China, we are "the barbarians" with a "fossil-money- 'democracy' that now rules the roost," making it impossible to legislate effectively on climate change. Unlike us, the Chinese are enlightened, unfettered by pesky elections. Here's what he blogged on Nov. 24:

"I have the impression that Chinese leadership takes a long view, perhaps because of the long history of their culture, in contrast to the West with its short election cycles. At the same time, China has the capacity to implement policy decisions rapidly. The leaders seem to seek the best technical information and do not brand as a hoax that which is inconvenient."

Read The Rest of the Article at

Jim Rogers: Easy to blame the Chinese for America's problems

« CHART UPDATE: Fed's balance sheet hits record high in latest week on new bond purchases - Fed Weekly Report »

After flattening out, it headed higher 8 straight weeks with QE2, until dipping just slightly last week, and then exploding to a new, all-time record high this week.

When the Fed wants to sell MBS and other securities, who's gonna buy?

The rest of the Fed's weekly report is inside, including foreign holdings.


Full Weekly Fed Report Is HERE - Including Reports From Past Weeks


(Reuters) - The U.S. Federal Reserve's balance sheet rose to a new high in the latest week as the U.S. central bank increased its holdings of Treasury securities as part of its $600 billion quantitative easing program, Fed data released on Thursday showed.

The balance sheet -- a broad gauge of Fed lending to the financial system -- expanded to $2.451 trillion in the week ended Jan. 12 from $2.418 trillion the prior week.

The central bank's holdings of U.S. government securities totaled $1.062 trillion on Wednesday, up from $1.031 trillion last week.

Meanwhile, the Fed's overnight direct loans to credit-worthy banks via its discount window averaged $23 million a day in the week ended Wednesday, less than the $100 million daily pace last week.

Continue reading at Reuters...


More Fed headlines...

Foreign central banks' U.S. debt holdings fall - Fed

Jan 13 (Reuters) - Foreign central banks' overall holdings of U.S. marketable securities at the Federal Reserve fell in the latest week, data from the U.S. central bank showed on Thursday. The Fed said its holdings of U.S. securities kept for overseas central banks fell $8.99 billion in the week ended Jan. 12 to $3.346 trillion.


Swaps with foreign cenbanks total $70 mln - NY Fed

(Reuters) - The Federal Reserve in the latest week provided $70 million of liquidity to the European Central Bank via its swap lines for foreign central banks, the New York Fed said on Thursday. The ECB was the sole institution to tap the swap lines in the week ended Jan. 12, swapping the full amount. The terms for the ECB swap were 7 days at 1.18 percent, the New York Fed added.


Full Weekly Fed Report Is HERE - Including Reports From Past Weeks


Answer this important question Bernanke:


More charts:


Related stories...

Alan Grayson - Congratulations America! You Own Bankrupt Red Roof Inns

Fed's Maiden Lane Spins Crap Assets Into Tungsten

CHART SHOCK: The REAL Unemployment Rate Is 22%

Not So Well Known - Tracking The Fed's OTHER Debt Purchase Program



True State Of The Economy - You'd Better Be Darn Scared

The damnable lies that continue out of lazy, corrupt media mouthpieces regarding the true state of the economy is nothing short of reprehensible. We expect politicians to lie every time they open their mouths. We expect ethically bankrupt crooks like Ben Bernanke and Timothy Geithner to lie every time they open their mouth to protect their banking interests. However, a free media is supposed to be the watch dog for government corruption and report the facts, not propaganda. Not so for a long, long time for what is known as the "mainstream" media. Fools they are because like tens of millions of others, they will also be reduced to penury. Lackeys for their corporate masters no longer question numbers; perhaps they are as ignorant as the majority of adults in this country when it comes to fiat currency and taxation.

The pathological liar camped out in the White House recently upchucked, "'We're digging ourselves out of a hole"' when the fake unemployment numbers allegedly show the jobless rate had dropped to the lowest level for 19 months. Bernanke, master in the art of deception, was pumping more false hope last month: "The Chairman of the Federal Reserve Ben Bernanke says until the U.S. economic system is completely stabilized, the country will be slow to climb completely out of its latest recession and that could mean high unemployment rates for a few more years. A native of Dillon, Bernanke made the remarks during a rare interview on CBS, "60 Minutes, which aired Sunday night."

Geithner says the U.S. government is broke, but look at his role in facilitating the coming collapse! Everything done by the private banking cartel [FED] with the full cooperation of Geithner is exactly the same destructive path taken by FDR. One of the most accurate and comprehensive writings on how the "New Deal" made the situation even worse back during the "Great" Depression is a piece by Lawrence W. Reed titled, Great Myths of the Great Depression. You will see the same programs touted by the communist in the White House are near twins of the failures promoted by FDR. While Lawrence's piece is 16 pages, it is well worth the time to get a good education on what didn't work and actually prolonged the depression by a decade. We are reliving history.

More lies from the media:

"The nation's unemployment rate is 9.8 percent. South Carolina's unemployment rate stands at 10.2 percent. Bernanke says what concerns him now is the length of time many America's have been out of the workforce."

Unemployment in this country is at depression levels. By 1933, unemployment peaked at 25%. The criminal syndicate out in DC ("our" government) claims unemployment is 9.8%. Really? The "official" unemployment number is 14, 443,867 Americans out of work. The actual number is 25, 684,164. Staggering numbers. 25.6 MILLION Americans have no jobs thanks to the Outlaw Congress and reckless spending by the states.

Stabilize the economy? Pray tell, Bernanke, how will do you that without jobs being created? How will you do that when ONE MILLION homes were foreclosed on last year and an estimated 20 MILLION homeowners will have underwater mortgages by the end of 2011? Someone tell me how you grow the economy with those numbers when the only real wealth for most Americans is their home?

Read the rest of Devvy's column at


Deep layoffs take effect in struggling NJ city

CAMDEN, N.J. – Some firefighters turned in their helmets and police officers their badges Tuesday as part of deep municipal layoffs destined to further erode the quality of life in Camden, already one of the nation's most impoverished and crime-ridden cities.

About 335 workers, representing one-sixth of the local government work force, lost their jobs, according to Mayor Dana Redd. It was worst in the public safety departments, where nearly half the police force and close to one-third of the city's firefighters were laid off.

Laid-off firefighters walked eight blocks together from the police union hall to Fire Department headquarters, snaking past City Hall, then lined up their helmets in front of the building, picked them back up and started to turn them in along with their other gear.

"It's one of the worst days in the history of Camden," said Ken Chambers, president of the firefighters union.

Redd blamed the public safety employee cuts on their unions, saying they have not been willing to make job-saving concessions or accept the reality that the state government will no longer bail out the city as it has for the past two generations.

"Instead of protecting and serving the city, the residents of Camden, they're choosing to protect their high salaries," she said.

The mayor said she was willing to continue negotiating with unions to try to reach cost savings that would allow the city to bring back some of the laid-off workers.

Redd said a proposal to the rank-and-file police union, the Fraternal Order of Police, was to be voted on Wednesday. She would not say exactly what the proposal entailed or how many jobs it could save. But she said that if the unions agree to concessions, about 100 police officers and most of the firefighters could be brought back.

Chambers said residents should not expect to be safe as the number of fire companies is reduced. He said the union will continue to meet with city officials to try to reach a deal under which some firefighters could be brought back.

Police officers had begun turning in their badges Monday as it became clear that no last-minute deal was going to save many jobs.

Located directly across the Delaware River from Philadelphia, Camden is rampant with open drug-dealing, prostitution and related crimes. More than half of Camden's 80,000 residents, mostly black and Hispanic, live in poverty.

A local pastor says "the fear quotient has been raised," and a police union took out a full-page newspaper advertisement last week warning that Camden would become a "living hell" if layoffs were not averted.

The city was the nation's second-most dangerous based on 2009 data, according to CQ Press, which compiles such rankings. Camden ranked first the previous two years. In 2009, the city had 2,380 violent crimes per 100,000 residents — more than five times the national average, the FBI said.

The anti-crime volunteer group Guardian Angels says it will patrol Camden, as it has Newark, where there were major police layoffs in November.

The Fire Department has already been relying on help from volunteer departments in neighboring towns. Interim Fire Chief David Yates, who retired Jan. 1, has warned that that layoffs will increase response times.

« Texas lawmakers faced with $27 billion budget shortfall »

Video - In her January 2011 revenue estimate, Texas Comptroller Susan Combs explains how she got it so wrong - allow me to summarize - she was an idiot...


Check out the slideshow...

Heads up - Fans of women's swimming (and high heel shoes) might want to make sure to see pic #4...


AUSTIN, Texas (AP) — Texas lawmakers will have a revenue shortfall of at least $15 billion for general-purpose spending for the next two-year budget compared to current state spending, according to figures released Monday.

Some analysts say the true shortfall could be much higher — closer to $27 billion — if lawmakers intend to maintain spending at current levels and still pay for enrollment growth in public schools and on Medicaid rolls, cost increases and other variables. That figure amounts to almost a third of discretionary state spending in the current budget.

The Texas Legislature will begin to grapple with the bleak budget picture when the session opens Tuesday.

"The recent recession has had its impact on the state revenue outlook as major revenue sources, such as the sales tax generated less money in the last couple of years," state Comptroller Susan Combs told reporters. "While we have turned the corner to an economic recovery, the revenue estimate I'm releasing today is for moderate growth."

The numbers cover the 2012-2013 budget, and include a $4.3 billion deficit in the current state budget.

Texas also will have about $9 billion in the so-called Rainy Day Fund, but that money can't be used without a two-thirds vote of the Legislature — a hurdle that may be too high with the new wave of fiscally conservative freshman Republican lawmakers.

The estimate, which gives the Legislature a roadmap as it embarks on the budget-writing process, has for months been the topic of election-year rhetoric, with Republican incumbents trying to downplay the severity of the budget mess.

"I don't think we have a budget hole," Gov. Rick Perry said in an interview with The Associated Press on Monday. "I think we have a budget of $76.5 billion and we're going to live with that. . . . It's only a budget hole when somebody has wished that they had more money."

Because of the recession, state tax receipts for the 2010 budget year have fallen behind projections, leaving a deficit in the current budget. The state is also on the hook to fill a hole of about $11 billion left by federal stimulus money and other state savings that were used last year but are no longer available. Added cost pressures from increased enrollment in public schools and health care programs for the poor and disabled, and spikes in health care costs, will compound the massive hole.

"When increased population and higher costs are taken into account, Texas is at least $26.8 billion short of the general revenue needed to provide for current services into the next biennium," said F. Scott McCown, executive director of the Center for Public Policy Priorities, which advocates for needy Texans. "In other words, we are short by at least 25 percent."

Continue reading....


Texas is $27 billion short...


Video - Incoming Texas house members discuss the budget shortfall...

Complete story inside including video, links and more. I also built a little Texas slideshow once I started finding so many potential photos for this story.

Check out the slideshow...

Editor's Note - Fans of women's swimming might want to make sure to see pic #4...


« Bankruptcy of U.S. is ‘Mathematical Certainty,’ Says Professor & Former CEO of Nation's 10th Largest Bank »

Video: John Allison - Runs 2 minutes - More on the National Debt...

Great clip. Quotes transcribed inside.

( - John Allison, who for two decades served as chairman and CEO of BB&T, the nation's 10th largest bank, told it is a “mathematical certainty” that the United States government will go bankrupt unless it dramatically changes its fiscal direction.

Allison likened what he sees as the predictable future bankruptcy of the United States to the problems at Fannie Mae and Freddie Mac, whose insolvency he also said was foreseeable to those who studied their business practices and financial situation.

“I think the first thing we have to realize is where we’re going and to face it objectively,” Allison told, when asked about the trillion-dollar-plus deficits the federal government has run for three straight years, the more than $13 trillion in federal debt, and the $61.9 trillion long-term shortfall the government faces (according to the analysis of the Peter G. Peterson Foundation) if the government is to pay all the benefits it has promised through entitlement programs.

“If you run the numbers, on all those numbers that you just talked about, which I think are accurate, very accurate, in 20 or 25 years, the United States goes bankrupt,” said Allison. “It’s a mathematical certainty.

“It reminds me very much of that story I told you about Freddie Mac and Fannie Mae,” said Allison. “We were running the numbers, and Freddie Mac and Fannie Mae went bankrupt, and we got there. In 20 or 25 years, the United States goes bankrupt.

“Now, countries don’t go bankrupt the way companies do,” said Allison. “They don’t file bankruptcy. They usually hyper-inflate. They print a bunch of paper money, or they become Third World economies like Argentina--unless we change direction. So, we absolutely have to change direction. And the irony of that is it requires an interesting combination. It requires both discipline, but it also requires a focus on growing our economy. And it means a fundamental philosophical change from where we are today, from the idea of redistributing wealth to the idea of creating wealth.”

In his interview with Allison said that when belonged to the Financial Services Roundtable they examined Fannie Mae and Freddie Mac and determined they were going bankrupt. Congressional leaders, however, did not heed their analysis.

“I was on a committee, a Financial Services Roundtable, for nine years trying to do something about Freddie Mac and Fannie Mae,” said Allison.

“You couldn’t help but see it coming,” he said. “You ran the numbers, particularly the last several years, and it was mathematically certain Freddie and Fannie were going bankrupt.”

“We met with Congress. We met with [House Financial Services Chairman] Barney Frank and [Senate Banking Chairman] Chris Dodd and they absolutely wouldn’t see it,” said Allison.

Allison became president of BB&T in 1987 and was elected chairman in 1989. He remained CEO through 2008. He is now distinguished professor of practice at the Wake Forest University Schools of Business. By 2009, according to rankings done by SNL Financial, BB&T had grown into the nation's 10th largest bank.


Allison: Give Young People Option to Get Out of Social Security


Check out the newest slideshow...

Editor's Note - Fans of women's swimming might want to make sure to see pic #4...


Portal » Board index » Economics » Economics genrally

Wonderful rant by Mike Rivero

So, an mp3 file which now costs 90 cents will soon cost $2.00 becauser of the costs for all this new enforcement and legal process.
This seems to continue a trend in which the United States makes less and less and compensates for it by adding more and more pointless layers to each product to run up the price.

So, the owner of the cattle farm decides he wants to sell the manure for fertilizer, but the government imposes a ban in just shoveling it into a sack and requires testing the cows for contagious pathogens, then the manure itself for parasites, then to make certain that the manure contains the USDA minimum required things that manure is supposed to have, then OSHA stops by to make certain the correct shovels are being used to harvest the product and that the bags are "up to code" for the estimated weight of the manure they will carry. Lawyers then stop by to inspect the manure and make certain that it does not conflict with the intellectual property rights of the farm down the road which sells a similar product. Great care is exercised in regards to the "look and feel" of the product and that it conform, to industry standards! Finally, the graphics and design on the bags are checked to make certain they represent the contents accurately and do not offend any recognized minority groups.

And in the end, the product is still the exact same thing. It is a sack of shit. But because of all the tinkering added to it in order to employ a bunch of lawyers and bureaucrats who otherwise would be on the unemployment lines, it is now an OFFICIAL (and very much more expensive) sack of shit. And the farmers who need to buy that sack to fertilize their own crops will pay a higher prices, which must then be passed onto their customers (along with all the overhead from the lawyering and plastering of government stickers they themselves must endure).

This is why American products cost so much more without being any better, and why you pay far more for prescription medicines than the Canadians do, or why dentists in Mexico can do a better job but cost far less than here in the US. You are not paying for just the medicine, or the dental bridge, or the sack of shit; you are paying a huge markup for all the regulatory jobs created out of thin air to conceal the fact that the United States just doesn't manufacture much of anything any more. We are a nation running in circles and trying to look busy, without actually getting much of anything done.

This new law on mp3s will not stop the pirates. It is just a way of conning the law-abiding consumer into forking over more money for their products under the illusion that paying $20 for a $5 bag of shit makes them morally superior to the rest of the world


Obama Launches Rule Review, Pledging to Spur Jobs, Growth

WASHINGTON—President Barack Obama plans a government-wide review of federal regulations, aiming to eliminate rules that stymie economic growth.

In an article published in the opinion pages of The Wall Street Journal, Mr. Obama said he intends to issue an executive order initiating a review to "make sure we avoid excessive, inconsistent and redundant regulation," focusing on rules that "stifle job creation and make our economy less competitive." He also suggested future regulations must do their job "while promoting economic growth."

The move is the latest effort by the White House to repair relations with corporate America, hoping to spur investment by the nation's largest multinationals and reduce unemployment.

Business leaders say an explosion in new regulations stemming from the president's health-care and financial regulatory overhauls has, along with the sluggish economy, made them reluctant to spend on expanding and hiring. Companies are sitting on nearly $2 trillion in cash and liquid assets, the most since World War II.

In recent weeks, the administration has made new efforts to push stalled free-trade agreements with Korea and others through Congress, and signaled its eagerness to consider an overhaul of the U.S. corporate tax code. The president invited chief executives to the White House last month, where they formed task forces to work on specific issues, including export growth and taxes.

On Feb. 7, Mr. Obama will visit the U.S. Chamber of Commerce—a chief opponent to his administration's regulatory approach—for a discussion on how the White House can work with the group to create jobs. The efforts are designed to give companies more confidence in the president's stewardship of the economy, and bolster his re-election prospects among a wealthy constituency not traditionally allied with Democrats.

In Tuesday's article, the president defended his administration's efforts to strike "the proper balance" between protecting the public and not interfering with economic growth.

The president said the government sometimes failed to meet its "basic responsibility to protect the public interest," citing the run-up to the financial crisis. He also acknowledged the cost of regulation and said that sometimes "rules have gotten out of balance, placing unreasonable burdens on business—burdens that have stifled innovation and have had a chilling effect on growth and jobs."

He also said: "Where necessary, we won't shy away from addressing obvious gaps: new safety rules for infant formula; procedures to stop preventable infections in hospitals; efforts to target chronic violators of workplace safety laws. But we are also making it our mission to root out regulations that conflict, that are not worth the cost, or that are just plain dumb."

For close to a year, the White House has been asking leading business groups in the capital to identify regulations they believe are obstacles to job-creating private investment. But these efforts are being dwarfed by complaints about the administration's unfriendly rhetoric toward the financial industry and large corporations, and regulations stemming from its legislative agenda.

Even some of the president's corporate allies have joined criticism of the White House's regulatory and tax policies. The Business Roundtable, an association of chief executives of many of the largest U.S. corporations, last year compiled a 54-page report that includes proposals to streamline rules proposed by the Environmental Protection Agency and the Federal Communications Commission, among scores of others. It was accompanied by public criticism from the Roundtable, whose members have frequently advised the White House on the economy.

At the same time, the administration faces pressure from the left not to appear to be too close to Wall Street and corporate interests. Liberals were irked most recently when Mr. Obama tapped political veteran and J. P. Morgan Chase & Co. executive William Daley as his chief of staff.

Marc Faber : Mature economies to beat EMs, food inflation worrying

Click this link ......

精武门之打Q一个大马 Part 1

精武门之打Q一个大马 Part 2

精武门之打Q一个大马 Part 3

精武门之打Q一个大马 Part 4 (完结篇)