Wishing our life away is not what we do, but let us say, thank goodness this year is nearly over and the likes of which we hope to never see again: a worldwide financial meltdown and the worst financial crisis since the Great Depression as we find ourselves with a U.S. National Debt standing at $10.6 Trillion dollars ($10,600,000,000,000) and that does not include the unfunded liabilities of Social Security and Medicare. Should you be interested, this is how the government spends our money: http://www.federalbudget.com/
December 31, 2002, the S&P closed at 879.8 and today, December 31, 2008, the S&P closed at 903.25, a gain of 23 points from six years ago and what appeared as forced to get there by the program trading driven market (for after the close, the market sold off). It took only 14 months to wipe out six years of gains and an estimated $7 Trillion dollars of investor money.
There is enough blame to go around: easy money by the Federal Reserve chairmen created a tech bubble and then one in housing; highly leveraged banks and financials and households took on excessive debt and risk; there existed lax lending practices and a lack of oversight and disregard for enforcement of rules and regulations that are in place. The agencies, Congress and the SEC were complicit by choosing to stand aside and do nothing, and they even went so far as to say they didn't see it coming. Hell, they helped create it.
October found Congress having passed a $700 Billion bailout package for financials, and half, $350 billion, was quickly dispersed to banks and brokers and who knows who else. Treasury Secretary Paulson decided to not tell even though he pledged transparency in the use of funds. Bloomberg and Fox News are the few having filed lawsuits against the Treasury in order to obtain the information. We do know money was given to JP Morgan, Citigroup, Bank of America, AIG (insurance), Morgan Stanley, Wells Fargo, Goldman Sachs, Fannie Mae, Freddie Mac... and Bear Stearn, Lehman, Countrywide, Washington Mutual, and Merrill no longer exist. Financials such as Goldman Sachs and credit card company American Express have become bank holding companies so they can get more of what they want. And Paulson says he wants the other half now!
We saw the price of oil rocket to over $147 while Goldman Sachs upped their price target to $200, a $4 dollar cost of gasoline, bankruptcy rise, home loan defaults and foreclosures at record levels, and as loans are now being modifies, half of them are again defaulting. As banks and brokers hoard the money given by the treasury, they unconscionably continue to give themselves bonuses and pay dividends at the expense of the taxpayer. The amount of money being thrown at this catastrophe seems endless. In November the Fed pledged $7.4 Trillion dollars to rescue the financial markets, and Barry Ritholtz has estimated the running total commitment to now being over $8 Trillion.
http://www.ritholtz.com/blog/2008/12/calculating-the-total-bailout-costs/
The failed business models of the big three automakers are being supported up by the Federal government by giving them a big piece of the action, but the UAW says they want more and will wait for Obama to take office for they are not willing to negotiate any terms. GMAC just got $6 billion, and the latest Bernard Madoff $50 Billion Ponzi scheme has wiped out fortunes. So in addition to the $700 billion bailout, we learn the highly leverage Fed balance sheet stands at $2.28 Trillion.
Peter Schiff, Nouriel Roubini, Jimmy Rogers, Robert Shiller, Marc Faber, Meredith Whitney... were among the few who predicted this disaster while the pundits of Wall Street and the CNBC stooges ridiculed many of them for telling the truth. You must buy and hold for the long term... the market always goes up... the stock market bottom is in... things are getting better... all is contained. . . have been the words repeated by mutual fund managers, heads of companies, the Wall Street bosses. . . even government officials, Congress, the Federal Reserve chairmen and Treasury Secretary fiddled while Rome burned.
And rest assured that as our November budget deficit reached a record $164 billion and Treasury receipts declined, and while the jobless claims surge with an unemployment rate at 6.8% and estimated to rise to 8-9%, Congress has seen to it that they will get their annual raise as will the federal judges in this country, and the Federal reserve has taken us to an unprecedented interest rate of zero to .25%.
These are the major highlights written as succinctly as possible, and we can only wish that by writing these words that it would all go away, but the likelihood is there may be more. Newspapers are facing troubling futures, hospitals seem ill from bad credit, credit losses are mounting and spreading to credit cards, and student loans. Commercial and industrial loans and corporate and municipal bonds are viewing the credit and debt crisis' ugly faces.
Our belief is that we have not seen a bottom in the stock market, that there will be rallys and sell-offs from time to time, and that this market may go lower. Many went to cash earlier in the year and await. What we do know is that it takes time to put in a bottom; it is a process and there may be more pain as healing begins.
So at midnight tonight when the champagne corks are popped (and you really should ease the cork out) and we enter a NEW YEAR, we must be optimistic and hope and pray for our brighter future. Patience will be required, but as we work our way through any pain and crisis, we will become stronger and the better for it.
Wednesday, December 31, 2008
Pelosi GTxi SS/Rt Sport Edition
Simply too good to pass up is this mandatory American car so advanced. .
Know that Congress is only looking out for you.
Know that Congress is only looking out for you.
Tuesday, December 30, 2008
Man Made Global Warming Disproved
Christopher Booker writes this morning that "Looking back over my columns of the past 12 months, one of their major themes was neatly encapsulated by two recent items for the The Daily Telegraph.
The first, on May 21, headed "Climate change threat to Alpine ski resorts" , reported that the entire Alpine "winter sports industry" could soon "grind to a halt for lack of snow". The second, on December 19, headed "The Alps have best snow conditions in a generation" , reported that this winter's Alpine snowfalls "look set to beat all records by New Year's Day".
Easily one of the most important stories of 2008 has been all the evidence suggesting that this may be looked back on as the year when there was a turning point in the great worldwide panic over man-made global warming. Just when politicians in Europe and America have been adopting the most costly and damaging measures politicians have ever proposed, to combat this supposed menace, the tide has turned in three significant respects.
First, all over the world, temperatures have been dropping in a way wholly unpredicted by all those computer models which have been used as the main drivers of the scare. Last winter, as temperatures plummeted, many parts of the world had snowfalls on a scale not seen for decades. This winter, with the whole of Canada and half the US under snow, looks likely to be even worse. After several years flatlining, global temperatures have dropped sharply enough to cancel out much of their net rise in the 20th century.
Ever shriller and more frantic has become the insistence of the warmists, cheered on by their army of media groupies such as the BBC, that the last 10 years have been the "hottest in history" and that the North Pole would soon be ice-free. . .
http://www.telegraph.co.uk/comment/columnists/christopherbooker/3982101/2008-was-the-year-man-made-global-warming-was-disproved.html
Perhaps the mounting evidence against warming has finally quelled some of the voices. And too as we find ourselves amidst this worldwide financial meltdown, politicians are realizing they don't have the trillions of dollars to throw at all the schemes that have been devised. This geopolitical frenzy created by computer models and perpetuated by the media and pundits truly speaks to the hubris of people, the egos of man who tell us they can control God and nature.
By the way, global warming seems to have been modified to (softly spoken) climate change. And where is Al Gore and his An Inconvenient Truth of half-truths and skewed data? Is he still flying about in his big jet wasting fuel and selling carbon credits to himself while telling us to conserve, or is he hiding in the basement of his 40,000 square foot house concocting another brainchild about which he can lay claim, like the internet he said he invented?
The first, on May 21, headed "Climate change threat to Alpine ski resorts" , reported that the entire Alpine "winter sports industry" could soon "grind to a halt for lack of snow". The second, on December 19, headed "The Alps have best snow conditions in a generation" , reported that this winter's Alpine snowfalls "look set to beat all records by New Year's Day".
Easily one of the most important stories of 2008 has been all the evidence suggesting that this may be looked back on as the year when there was a turning point in the great worldwide panic over man-made global warming. Just when politicians in Europe and America have been adopting the most costly and damaging measures politicians have ever proposed, to combat this supposed menace, the tide has turned in three significant respects.
First, all over the world, temperatures have been dropping in a way wholly unpredicted by all those computer models which have been used as the main drivers of the scare. Last winter, as temperatures plummeted, many parts of the world had snowfalls on a scale not seen for decades. This winter, with the whole of Canada and half the US under snow, looks likely to be even worse. After several years flatlining, global temperatures have dropped sharply enough to cancel out much of their net rise in the 20th century.
Ever shriller and more frantic has become the insistence of the warmists, cheered on by their army of media groupies such as the BBC, that the last 10 years have been the "hottest in history" and that the North Pole would soon be ice-free. . .
http://www.telegraph.co.uk/comment/columnists/christopherbooker/3982101/2008-was-the-year-man-made-global-warming-was-disproved.html
Perhaps the mounting evidence against warming has finally quelled some of the voices. And too as we find ourselves amidst this worldwide financial meltdown, politicians are realizing they don't have the trillions of dollars to throw at all the schemes that have been devised. This geopolitical frenzy created by computer models and perpetuated by the media and pundits truly speaks to the hubris of people, the egos of man who tell us they can control God and nature.
By the way, global warming seems to have been modified to (softly spoken) climate change. And where is Al Gore and his An Inconvenient Truth of half-truths and skewed data? Is he still flying about in his big jet wasting fuel and selling carbon credits to himself while telling us to conserve, or is he hiding in the basement of his 40,000 square foot house concocting another brainchild about which he can lay claim, like the internet he said he invented?
Monday, December 29, 2008
Caroline Kennedy Failed to Cast Votes
Caroline Kennedy wants to be the next senator from New York, but her voting record is already spotty, the Daily News has found.
According to the City Board of Elections, it appears that Caroline Kennedy failed to vote in many elections since she registered in 1988, including primary races for mayor in 1989, 1993 and 1997 and 2005. . . in fact she skipped about half, almost all of them primaries.
http://www.nydailynews.com/news/politics/2008/12/18/2008-12-18_records_show_caroline_kennedy_failed_to_.html
Does one not wonder about her commitment?
According to the City Board of Elections, it appears that Caroline Kennedy failed to vote in many elections since she registered in 1988, including primary races for mayor in 1989, 1993 and 1997 and 2005. . . in fact she skipped about half, almost all of them primaries.
http://www.nydailynews.com/news/politics/2008/12/18/2008-12-18_records_show_caroline_kennedy_failed_to_.html
Does one not wonder about her commitment?
Sunday, December 28, 2008
White, WVU Bowl Win
Yesterday we watched WVU win over UNC 31-30 in the Meineke Bowl in Charlotte, NC, a close and exciting game and one in which either team could have won. Besides being Mountaineer fans, there is a great fondness for WVU's quarterback Patrick White, who continued in his tradition of out performance yesterday.
Over the years we have seen West Virginia University teams play when games are televised here on the west coast. Quite disturbing was last years messy departure of then coach Rich Rodriguez to Michigan and his decision to leave the WVU players prior to finishing the season with their play in the Fiesta Bowl. Assistant coach Bill Stewart stepped in and fortunately led the players to a bowl victory.
The disruptive departure had to be a disheartening experience for the players and seemingly took some wind out of their sails. On several occasions we had said what a shame it would be to see this fine young quarterback end his career on any down note. Following yesterday's performance, it is quite apparent the team overcame the challenge.
One thing clear as we have observed from our 2750 mile sideline post, is the behavior of one Patrick White: a quiet and seemingly shy young man; his calm and methodical manner, whether on the field or off; the immediate engagement of his fellow players as he exits to the sidelines; his constant focus on teammates and opponents and the game being played; a seriousness and determination of the job he has to do and the positive spirit in which he administers. His leadership and perceptive qualities are apparent, as well as his sense of self.
Yesterday Pat White threw for a career-high 332 yards, but among his many major accomplishments, he is the first quarterback in major college football history to win 4 consecutive bowl games and finishes as the all-time rushing quarterback with 4480 yards. He has passed for 6049 college career yards.
WVU's coach Bill Stewart said, "I think he's the greatest winner today in the game. He's taken this football team on his back time after time after time, game after game after game, injured, when we were struggling, what have you, and willed people -- willed them -- to march down the field to victory. I don't know how you can bottle that up."
http://www.post-gazette.com/pg/08360/937594-144.stm
Immediately following yesterday's game and rather than celebrate himself, White demonstrated something extraordinary by paying tribute to his absent teammate Brandon Hogan, # 22, who was ill and unable to play.
Did you know White had signed a letter-of-intent in February 2004, when he was selected in an amateur baseball draft and offered a six-figure signing bonus, but instead chose to finish college? There seems to be no time for shuckin' and jivin' and high-fivin', as we say, but rather a purposeful judgment and focus upon goals and accomplishment, a role model for young people to follow. There are many pro-athletes who would do well to use him as an example.
Patrick White, our hope in young people is restored by you.
I am proud to be a Mountaineer.
Over the years we have seen West Virginia University teams play when games are televised here on the west coast. Quite disturbing was last years messy departure of then coach Rich Rodriguez to Michigan and his decision to leave the WVU players prior to finishing the season with their play in the Fiesta Bowl. Assistant coach Bill Stewart stepped in and fortunately led the players to a bowl victory.
The disruptive departure had to be a disheartening experience for the players and seemingly took some wind out of their sails. On several occasions we had said what a shame it would be to see this fine young quarterback end his career on any down note. Following yesterday's performance, it is quite apparent the team overcame the challenge.
One thing clear as we have observed from our 2750 mile sideline post, is the behavior of one Patrick White: a quiet and seemingly shy young man; his calm and methodical manner, whether on the field or off; the immediate engagement of his fellow players as he exits to the sidelines; his constant focus on teammates and opponents and the game being played; a seriousness and determination of the job he has to do and the positive spirit in which he administers. His leadership and perceptive qualities are apparent, as well as his sense of self.
Yesterday Pat White threw for a career-high 332 yards, but among his many major accomplishments, he is the first quarterback in major college football history to win 4 consecutive bowl games and finishes as the all-time rushing quarterback with 4480 yards. He has passed for 6049 college career yards.
WVU's coach Bill Stewart said, "I think he's the greatest winner today in the game. He's taken this football team on his back time after time after time, game after game after game, injured, when we were struggling, what have you, and willed people -- willed them -- to march down the field to victory. I don't know how you can bottle that up."
http://www.post-gazette.com/pg/08360/937594-144.stm
Immediately following yesterday's game and rather than celebrate himself, White demonstrated something extraordinary by paying tribute to his absent teammate Brandon Hogan, # 22, who was ill and unable to play.
Did you know White had signed a letter-of-intent in February 2004, when he was selected in an amateur baseball draft and offered a six-figure signing bonus, but instead chose to finish college? There seems to be no time for shuckin' and jivin' and high-fivin', as we say, but rather a purposeful judgment and focus upon goals and accomplishment, a role model for young people to follow. There are many pro-athletes who would do well to use him as an example.
Patrick White, our hope in young people is restored by you.
I am proud to be a Mountaineer.
Saturday, December 27, 2008
Wonderful Evening Meal
Another wonderful evening meal, and to think they were leftovers! Yep, we love leftovers. There is something about fixing a simple but fantastic meal, finding a fine bottle of wine for accompaniment, and as you partake in this experience, the agreement is that there is no restaurant that could substitute for this. . . it doesn't get any better than right here in our own kitchen. Savoring something wonderful and having enough remain for another meal, well, that is a dynamic duo.
For Christmas dinner we had prepared a delicious, cheesy and fresh broccoli casserole; garlic and horseradish mashed potatoes; crimini mushrooms, sauteed very quickly in just a touch of butter and a final sprinkling of kosher salt, and served over a tri-tip, having been seasoned with a dry rub I concoct, then thinly sliced.
We decided upon a '99 Keaten-Reed Cabernet Sauvignon, an Oregon wine we have stored for a number of years. Its jammy aroma and nice aged body was a final touch for the spicy and peppery exterior of the meat.
And last night we got to do it all over again, for it reheated very nicely. The mushrooms were gone, so I sauteed a few more, and since my husband had perfectly grilled the tri-tip for our Christmas dinner, seared on the outside and juicy on the inside, I sliced enough for the two of us and reheated it in the microwave, just enough time to heat through slightly and not impair the pinkness of the meat.
Add another nice Cabernet and Bon appetit! It simply doesn't get much better than this.
For Christmas dinner we had prepared a delicious, cheesy and fresh broccoli casserole; garlic and horseradish mashed potatoes; crimini mushrooms, sauteed very quickly in just a touch of butter and a final sprinkling of kosher salt, and served over a tri-tip, having been seasoned with a dry rub I concoct, then thinly sliced.
We decided upon a '99 Keaten-Reed Cabernet Sauvignon, an Oregon wine we have stored for a number of years. Its jammy aroma and nice aged body was a final touch for the spicy and peppery exterior of the meat.
And last night we got to do it all over again, for it reheated very nicely. The mushrooms were gone, so I sauteed a few more, and since my husband had perfectly grilled the tri-tip for our Christmas dinner, seared on the outside and juicy on the inside, I sliced enough for the two of us and reheated it in the microwave, just enough time to heat through slightly and not impair the pinkness of the meat.
Add another nice Cabernet and Bon appetit! It simply doesn't get much better than this.
Friday, December 26, 2008
Wingsuit Base Jumping
Have you ever dreamed of flying? I mean, in your dream, you were flying solo, like a bird, catching the air current, hovering above ground, drifting, sailing through the air. . . Yes, I have dreamed of that, but not for a long, long time.
Now, understand that I am afraid of heights, and the thing that takes my breathe away is when someone stands near the edge or leans out over, that I tend to hyperventilate, but this film is so unbelievable, and if I weren't older than dirt, I think I'd want to try it. (laughing out loud as I type this.)
Absolutely amazing, you must view this.
wingsuit base jumping from Ali on Vimeo.
I can imagine.
Now, understand that I am afraid of heights, and the thing that takes my breathe away is when someone stands near the edge or leans out over, that I tend to hyperventilate, but this film is so unbelievable, and if I weren't older than dirt, I think I'd want to try it. (laughing out loud as I type this.)
Absolutely amazing, you must view this.
wingsuit base jumping from Ali on Vimeo.
I can imagine.
Tuesday, December 23, 2008
Merry Christmas and Happy Holidays
“The fog embraces the silent voices which grace the landscape,
Yet I hear rejoicing, for in Christmas love is born.
A tenderness of heart, a joy in living, and peace within,
We hope and pray is yours.”
As we wish you a blessed Christmas,
know you are in our thoughts and prayers
and that we love you,
- - - - - - - -
A favorite photo taken of the garden and words which come from our heart, result in this years Christmas card for family and friends, and one we would like to share with you.
Whether you observe Christmas, Hanukkah, the Winter solstice. . . or even do not believe in a celebration, we send our best wishes to you, and hope this winding down of one year and the gearing up for a new one will find yourself guided by much love, joy, and peace.
Sunday, December 21, 2008
Dark Times Ahead
The unusual snow, ice and freezing temperatures this time of year are now but this photo memory as we return to rain and 45 degrees. Seldom do we consider looking forward to rain in the winter months here in the Pacific northwest, for that is what it does in the winter, but we did in fact say that. 
So this early morning finds us doing what we do and that is scanning and reading various online newspapers of the world in an attempt to understand what is going on around us. Quite an interesting perspective and forthright is the following article in Pravda online, Russian internet-based newspaper, regarding U.S. politics and the current situation.Obama Dark Times Ahead
According to this editorial in Pravda.ru, president elect Obama is a mystery, for questions as to who he is and whether or not he is even an American citizen have not been answered.
It is, to say the least, absolutely insane that someone about whom so little is known can be elected president of the US, still the most powerful country in the world, at least in a military sense. Therefore, it is a sad but eloquent comment on the state of US democracy.
There seems to be no difference between the two political parties for one only has to look at many of his cabinet selections, a seamless continuation of his predecessor's policies.
Obama is considered a postmodern politician, one who "... may adopt whatever policy, either because he feels like it himself, but more likely because his handlers tell him what to do... ".
As for Western World politicians: This race of spineless, adaptable politicians sits on top of a pyramid that is composed of individuals like them, also lacking in character. In other words, they are not real persons, just some kind of robots, like the Stepford Wives. You just push the right button and they'll do what you tell them to...
Upon assuming office, Obama will find himself at the head of a bankrupt country. Bankrupt in many senses: financially, socially, ethically, psychologically. The US has become the victim of its own destructive policies. It is now finally being confronted with the consequences of decades of stupidity and ineptitude . . .
http://english.pravda.ru/opinion/columnists/106834-0/
Rather curious that one finds this writing in Russia as opposed to being printed here in the U.S. (the freedom of the press country), for it is what many Americans think. Does it not seem that in this country there has been a transformation from journalism once defined as investigatory reporting, fact finding and reporting the truth, to having become a press that speaks with one voice, single-minded and with orchestrated agendas?
Thursday, December 18, 2008
In Madoff We Trust
Just as Bernard Madoff and his $50 billion Wall Street scheme and Charles Ponzi, for whom Ponzi scheme is named, were able to find the greater fool to pay up - for a period of time, the tech and housing bubbles in our economy were indeed similar, says Peter Schiff.
How is it any different from the Social Security system or the U.S. government's balance sheets and national debt?
The main difference is that while Madoff took elaborate steps to conceal his scheme, the U.S. government operates in broad daylight. It truly is amazing how faith in government is so pervasive that many can believe that politicians will succeed where private individuals fail, and that governments are somehow immune to the economic laws that govern the rest of society. Like those unfortunate to have been duped by Madoff and Ponzi, the world is in for a rude awakening.
Worth reading is this entire article:
http://seekingalpha.com/article/111199-in-madoff-we-trust
How is it any different from the Social Security system or the U.S. government's balance sheets and national debt?
The main difference is that while Madoff took elaborate steps to conceal his scheme, the U.S. government operates in broad daylight. It truly is amazing how faith in government is so pervasive that many can believe that politicians will succeed where private individuals fail, and that governments are somehow immune to the economic laws that govern the rest of society. Like those unfortunate to have been duped by Madoff and Ponzi, the world is in for a rude awakening.
Worth reading is this entire article:
http://seekingalpha.com/article/111199-in-madoff-we-trust
Wednesday, December 17, 2008
Consumers Tightening, Somewhat
Consumers appear to be tightening their belts as the number shopping decreased sharply despite steep price cuts and limited-time only deals for the holiday season, according to data released by ShopperTrak. It seems foot traffic fell nearly 18% last week compared to the previous year.
http://www.reuters.com/article/marketsNews/idINN1734129520081217?rpc=44
However, week over week, there has been an increase. Guess we'll simply have to wait for the final results.
As for us, we are ice and snow homebound, and even if we were not, we still would not be shopping. It became meaningless for us many years ago. If you make it yourself, we would love to have your gift; otherwise, save your money.
Schapiro May Be New SEC Chairman
Mary Schapiro, former CFTC (Commodity Futures Trading Commission) head in the Clinton Administration, may be named by president elect Obama as SEC chairman tomorrow.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aAAg.XK6BesQ&refer=home
Hopefully she can straighten some things out. Wondering if she can tell us how Hillary Clinton made $100,000 from $1000 in cattle futures trading? Probably not, but I just had to say it anyway.
If it is Ms Schapiro, then we do hope she can do good things.
http://www.reuters.com/article/marketsNews/idINN1734129520081217?rpc=44
However, week over week, there has been an increase. Guess we'll simply have to wait for the final results.
As for us, we are ice and snow homebound, and even if we were not, we still would not be shopping. It became meaningless for us many years ago. If you make it yourself, we would love to have your gift; otherwise, save your money.
Schapiro May Be New SEC Chairman
Mary Schapiro, former CFTC (Commodity Futures Trading Commission) head in the Clinton Administration, may be named by president elect Obama as SEC chairman tomorrow.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aAAg.XK6BesQ&refer=home
Hopefully she can straighten some things out. Wondering if she can tell us how Hillary Clinton made $100,000 from $1000 in cattle futures trading? Probably not, but I just had to say it anyway.
If it is Ms Schapiro, then we do hope she can do good things.
Feds Balance Sheet, $2.28 Trillion
The Federal Reserve's balance sheet stands at $2.26 Trillion dollars compared to $868 Billion in July 2007. That’s in addition to the $700 billion Troubled Asset Relief Program, which the U.S. Treasury has used since October to channel about $335 billion of capital injections into banks and other financial companies.
Still, the economy has crumbled, with employers cutting 533,000 jobs from payrolls in November for a total loss this year of 1.9 million, which more than erases the 2007 gain of 1.1 million.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aHtjzkdBhlrI&refer=home
Best save what pennies you can. Problematic. . . our dollar may be like burnt toast.
Still, the economy has crumbled, with employers cutting 533,000 jobs from payrolls in November for a total loss this year of 1.9 million, which more than erases the 2007 gain of 1.1 million.
Credit remains scarce in many markets and major financial institutions worldwide continue to report losses and writedowns totaling $994 billion.
Former president of the St. Louis Fed, William Poole, said the Fed would print money to an unlimited extent until it starts to see the economy expanding.http://www.bloomberg.com/apps/news?pid=20601087&sid=aHtjzkdBhlrI&refer=home
Best save what pennies you can. Problematic. . . our dollar may be like burnt toast.
Tuesday, December 16, 2008
Fed Cuts Rates To Historic Low
History in the making as the Federal Reserve cut the interest rate for the first time in its history to between zero and a quarter percentage point (0-.25%). Actually overnight rates had already been at zero percent, so today's market rally based upon the already much anticipated rate cut, was really not new news.
"The Federal Reserve will employ all available tools to promote the resumption of sustainable economic growth and to preserve price stability," the Fed said in a statement. It added that it expected interest rates to remain low "for some time" and that it was studying other measures, such as purchasing U.S. Treasury securities, to lift the economy.
http://online.wsj.com/article/SB122945283457211111.html?mod=googlenews_wsj
Hopefully this move can help many to refinance their homes at a much lower rate, that is if the banks will participate. And remember, since the consumer is over 70% of the economy, the Fed wants "you" to help by spending more money, not save, but increase your debt and spend, spend, spend. Isn't easy money, debt, and leverage the reason we are in this circumstance in the first place?
We only have one thing to say to Washington: Surely you jest! Us spend more? No thank you. Rather we are saving what pennies we can, for when inflation hits as you decide to crank up the printing press, it is going to cost each of us big. Don't you think the taxpayer is heavily burdened enough?
At this point Fed chairman Bernanke has pretty much shot his wad, so to speak, for you can't get any lower than zero percent! A major concern regarding that zero rate: Does he now reflate the bubble that has just burst? Let us hope and pray not.
"The Federal Reserve will employ all available tools to promote the resumption of sustainable economic growth and to preserve price stability," the Fed said in a statement. It added that it expected interest rates to remain low "for some time" and that it was studying other measures, such as purchasing U.S. Treasury securities, to lift the economy.
http://online.wsj.com/article/SB122945283457211111.html?mod=googlenews_wsj
Hopefully this move can help many to refinance their homes at a much lower rate, that is if the banks will participate. And remember, since the consumer is over 70% of the economy, the Fed wants "you" to help by spending more money, not save, but increase your debt and spend, spend, spend. Isn't easy money, debt, and leverage the reason we are in this circumstance in the first place?
We only have one thing to say to Washington: Surely you jest! Us spend more? No thank you. Rather we are saving what pennies we can, for when inflation hits as you decide to crank up the printing press, it is going to cost each of us big. Don't you think the taxpayer is heavily burdened enough?
At this point Fed chairman Bernanke has pretty much shot his wad, so to speak, for you can't get any lower than zero percent! A major concern regarding that zero rate: Does he now reflate the bubble that has just burst? Let us hope and pray not.
Monday, December 15, 2008
Fred Thompson Explains Our Economy
When you listen to this, you have to shake your head. Comedic aspects, truthfully addressed, and what a sad statement on our government, Wall Street, and the situation in which we find ourselves as a nation.
or http://www.theospark.net/2008/12/fred-thompson-explains-bailouts.html
Makes me feel a bit ill.
or http://www.theospark.net/2008/12/fred-thompson-explains-bailouts.html
Makes me feel a bit ill.
SEC Gave Madoff a Pass
As I gaze out onto the snow covered ground and into the 21 degree F cold abyss, I am stunned by what has occurred and thoughts of the SEC (Securities and Exchange Commission) go something like this, "... as worthless as teats on a boar".
On Friday I wrote about the latest scandal on Wall Street, Bernard Madoff and his alleged $50 Billion dollar Ponzi scheme. Did you know that the SEC had investigated Madoff and reported they found nothing wrong!
And people gave Madoff lots of money to invest and in some instances no questions asked for they took him at his word. It used to be that way you know: someones word used to mean something. But today, when it comes to investing your money. . . some sound advice is being offered in this article.
http://money.cnn.com/2008/12/15/magazines/fortune/madoff.fortune/
This morning HSBC revealed it had a possible $1 Billion at risk with Madoff, while Santander, the euro zone's largest bank by market value, said its clients had $3.1 billion; U.K.'s Royal Bank of Scotland Group, nearly $600 million. . . and the list goes on.
http://money.cnn.com/news/newsfeeds/siliconalley/search/2008_12_bernie_madoff_hosed_client_list.html
Could the man have really done this by himself? Many say, quite doubtful. We have to wonder what follows.
On Friday I wrote about the latest scandal on Wall Street, Bernard Madoff and his alleged $50 Billion dollar Ponzi scheme. Did you know that the SEC had investigated Madoff and reported they found nothing wrong!
And people gave Madoff lots of money to invest and in some instances no questions asked for they took him at his word. It used to be that way you know: someones word used to mean something. But today, when it comes to investing your money. . . some sound advice is being offered in this article.
http://money.cnn.com/2008/12/15/magazines/fortune/madoff.fortune/
This morning HSBC revealed it had a possible $1 Billion at risk with Madoff, while Santander, the euro zone's largest bank by market value, said its clients had $3.1 billion; U.K.'s Royal Bank of Scotland Group, nearly $600 million. . . and the list goes on.
http://money.cnn.com/news/newsfeeds/siliconalley/search/2008_12_bernie_madoff_hosed_client_list.html
Could the man have really done this by himself? Many say, quite doubtful. We have to wonder what follows.
Sunday, December 14, 2008
Early Cold and Snow
The full moon peers inside my studio window this cold morning (35 degrees F), the same as it did yesterday when 
we awoke and found this beautiful picture patiently awaiting our attention. Hm. . . seems someone forgot to remove some tomato cages from a few of the raised beds. . . I'll put it on my list.
Snow and cold temperatures this early in the season is most unusual. Tomorrow's low is expected to be 16 degrees! Ouch. . . for the norm is to have only about one week of freezing during the entire winter.
Day before yesterday, December 12, the moon appeared 30% brighter and 14% larger for it was at its closest perigee in its oval orbit. . . as opposed to it being at apogee (farthest away).
http://news.nationalgeographic.com/news/2008/12/081212-full-moon-biggest.html
As I write, the snow is nearly gone and should definitely be so shortly, as I watch what seems to be rain beginning its crawl from the coastal range toward the valley. Oops. . . seems we have more snow flurries.
Time to bundle up, stay warm, and say Happy Birthday to my friend Ginny! We think it's cold here, what do you think it's like in Minnesota?
we awoke and found this beautiful picture patiently awaiting our attention. Hm. . . seems someone forgot to remove some tomato cages from a few of the raised beds. . . I'll put it on my list.Snow and cold temperatures this early in the season is most unusual. Tomorrow's low is expected to be 16 degrees! Ouch. . . for the norm is to have only about one week of freezing during the entire winter.
Day before yesterday, December 12, the moon appeared 30% brighter and 14% larger for it was at its closest perigee in its oval orbit. . . as opposed to it being at apogee (farthest away).
http://news.nationalgeographic.com/news/2008/12/081212-full-moon-biggest.html
As I write, the snow is nearly gone and should definitely be so shortly, as I watch what seems to be rain beginning its crawl from the coastal range toward the valley. Oops. . . seems we have more snow flurries.
Time to bundle up, stay warm, and say Happy Birthday to my friend Ginny! We think it's cold here, what do you think it's like in Minnesota?
Saturday, December 13, 2008
Two Year Anniversary
We celebrated my husband's birthday this week, and following dinner as we lounged by the fire 
with two of our friends, my thoughts turned to another celebration. . . of course not as splendid as the one having been shared with my beloved, but a significant one I do believe.
Two years ago today marks the beginning of my writing this blog, StrasserTalk. My intention, as is still, was to write about day-to-day things, the economy and markets and as little politics as possible; family, friends and topics of interest - our travel and gardens; and hopefully bring a reasonable voice to some of the misleading articles and bias which exist, for sometimes you must speak out. . . and somebody's gotta say it.
Of late it seems we have been consumed and skewed towards politics, bailouts and crisis of markets and confidence, and as we approach the end of this year, my hope is that we will see more stability and therefore more balance in the atmosphere on these pages.
So thank you for occasionally taking time to visit, and I look forward to seeing you here as we continue to have a voice and attempt to figure out what is going on.
with two of our friends, my thoughts turned to another celebration. . . of course not as splendid as the one having been shared with my beloved, but a significant one I do believe.Two years ago today marks the beginning of my writing this blog, StrasserTalk. My intention, as is still, was to write about day-to-day things, the economy and markets and as little politics as possible; family, friends and topics of interest - our travel and gardens; and hopefully bring a reasonable voice to some of the misleading articles and bias which exist, for sometimes you must speak out. . . and somebody's gotta say it.
Of late it seems we have been consumed and skewed towards politics, bailouts and crisis of markets and confidence, and as we approach the end of this year, my hope is that we will see more stability and therefore more balance in the atmosphere on these pages.
So thank you for occasionally taking time to visit, and I look forward to seeing you here as we continue to have a voice and attempt to figure out what is going on.
Friday, December 12, 2008
Madoff $50 Billion Ponzi Scheme
Washington, D.C., Dec 11, 2008 - The Securities and Exchange Commission today charged Bernard L. Madoff and his investment firm, Bernard L. Madoff Investment Securities LLC, with securities fraud for a multi-billion dollar Ponzi scheme that he perpetrated on advisory clients of his firm. The SEC is seeking emergency relief for investors, including an asset freeze and the appointment of a receiver for the firm.
http://www.sec.gov/news/press/2008/2008-293.htm
This man was a former chairman of the NASDAQ stock exchange! I find myself nearly speechless as I think of the devastating psychology in the markets right now and what other demons may lurk in the financial arena.
And to think that the SEC is seeking emergency relief for these investors is beyond. . . really, the taxpayer should pay for this too?
How disturbing is the financial mess in which we find ourselves, yet I hear people dismiss it with a brush of the palm; since everybody does it, it appears to be a nonevent, all factored in and just one more thing in the string of it. It just doesn't matter.
Sad and indeed a pathetic statement on what our society has become.
http://www.sec.gov/news/press/2008/2008-293.htm
This man was a former chairman of the NASDAQ stock exchange! I find myself nearly speechless as I think of the devastating psychology in the markets right now and what other demons may lurk in the financial arena.
And to think that the SEC is seeking emergency relief for these investors is beyond. . . really, the taxpayer should pay for this too?
How disturbing is the financial mess in which we find ourselves, yet I hear people dismiss it with a brush of the palm; since everybody does it, it appears to be a nonevent, all factored in and just one more thing in the string of it. It just doesn't matter.
Sad and indeed a pathetic statement on what our society has become.
Thursday, December 11, 2008
Pay Raise For Judges
Did you get an automatic pay raise this year. . . a cost of living adjustment? Congress does. They saw to that decades ago. Each year they give themselves more money. And now as part of the $14 Billion bailout plan for the automakers, Senate majority leader Harry Reid decided to tuck in a pay raise for federal judges, giving them nearly $5000 more beginning January 1 and on par with members of Congress.
District judges and lawmakers now earn $169,300 a year but are expected to be awarded a 2.8 percent raise next year.
http://news.yahoo.com/s/ap/20081210/ap_on_go_co/judicial_pay_raise
Record November Budget Deficit
Last week jobless claims surged to 573,000. Millions of jobs have been lost, bankruptcies are on the rise, people's financial assets are being depleted, foreclosures continue their climb, and plants and businesses are closing their doors as banks hoard the approximate $300 billion dollars given to them.
The November budget deficit announced yesterday reached a record $164.4 billion dollars, while receipts into the Treasury declined from $151.1 billion to $144.8 billion, year on year.
The U.S. deficit over the two months of the fiscal year to date now stands at a record $401.6 billion, compared with the most recent official budget estimated for the full fiscal year of a deficit of $481.8 billion.
http://www.xe.com/news/Wed%20Dec%2010%2014:39:00%20EST%202008/123317.htm?categoryId=1¤tPage=1
Surely it does not need to be said for we know that considering our present economic state, a pay raise tucked into the automaker's bailout. . . well, inappropriate comes to mind, for I cannot write that which I truly am thinking.
District judges and lawmakers now earn $169,300 a year but are expected to be awarded a 2.8 percent raise next year.
http://news.yahoo.com/s/ap/20081210/ap_on_go_co/judicial_pay_raise
Record November Budget Deficit
Last week jobless claims surged to 573,000. Millions of jobs have been lost, bankruptcies are on the rise, people's financial assets are being depleted, foreclosures continue their climb, and plants and businesses are closing their doors as banks hoard the approximate $300 billion dollars given to them.
The November budget deficit announced yesterday reached a record $164.4 billion dollars, while receipts into the Treasury declined from $151.1 billion to $144.8 billion, year on year.
The U.S. deficit over the two months of the fiscal year to date now stands at a record $401.6 billion, compared with the most recent official budget estimated for the full fiscal year of a deficit of $481.8 billion.
http://www.xe.com/news/Wed%20Dec%2010%2014:39:00%20EST%202008/123317.htm?categoryId=1¤tPage=1
Surely it does not need to be said for we know that considering our present economic state, a pay raise tucked into the automaker's bailout. . . well, inappropriate comes to mind, for I cannot write that which I truly am thinking.
Wednesday, December 10, 2008
AIG's Black Hole
When does it stop? AIG (American International Group Inc) needs another $10 billion for speculative trades that have soured, according to people familiar with the matter, underscoring the challenges the insurer faces as it seeks to recover under a U.S. government rescue plan.
http://online.wsj.com/article/SB122887203792493481.html?mod=testMod
When I wrote about AIG last month, the Federal government bailout for this company alone stood at about $152 billion. Remember that the total bailout for everyone is $700 billion.
http://strassertalk.blogspot.com/search?q=aig+egregious
And yesterday, according to Bloomberg, AIG offered cash awards to another 38 executives in a retention program with payments of as much as $4 million.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aKIvmgvNl6zA
Absolutely outrageous. Folks, where is the oversight and accountability for all of this money, not just to AIG, but also the banks? One other question: how can banks be allowed to continue paying a dividend?
http://online.wsj.com/article/SB122887203792493481.html?mod=testMod
When I wrote about AIG last month, the Federal government bailout for this company alone stood at about $152 billion. Remember that the total bailout for everyone is $700 billion.
http://strassertalk.blogspot.com/search?q=aig+egregious
And yesterday, according to Bloomberg, AIG offered cash awards to another 38 executives in a retention program with payments of as much as $4 million.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aKIvmgvNl6zA
Absolutely outrageous. Folks, where is the oversight and accountability for all of this money, not just to AIG, but also the banks? One other question: how can banks be allowed to continue paying a dividend?
Tuesday, December 9, 2008
Treasury Yield Below Zero
Have we got a deal for you. . . rather, the government does. Supposedly the safest place to put ones cash today is in treasuries, that according to the media.
The yield this morning on the 3-month treasury fell below zero, a low last seen in 1941. That's right: you give the treasury your money, they use it, and at the end of three months, will return less than you gave them. Not that's quite the deal!
What is wrong with this picture? The banks wouldn't be part of this, now would they? We are wondering where all that cash is that was given them by the Fed over the last several months.
The yield this morning on the 3-month treasury fell below zero, a low last seen in 1941. That's right: you give the treasury your money, they use it, and at the end of three months, will return less than you gave them. Not that's quite the deal!
What is wrong with this picture? The banks wouldn't be part of this, now would they? We are wondering where all that cash is that was given them by the Fed over the last several months.
Monday, December 8, 2008
Automakers $15 Billion Lifeline
A few moments ago it was announced that automakers got a lifeline, $15 Billion (they asked for $34 billion), but it will likely last only a couple months. . . and they are going to have a Federal 'car czar'.
It's hard to say which is more frightening — the idea of the auto industry being run from Washington, D.C., or that experts like Economy.com's Mark Zandi say the Big Three will utilmately need $75 billion to $125 billion in order to avoid bankruptcy.
http://finance.yahoo.com/tech-ticker/article/140964/Big-Three-Bailout:-$15B-Just-a-Start-Whether-GMs-Wagoner-Stays-or-Goes
A broken industry with highly leveraged and unsustainable debt and obligations that cannot be paid, Speaker Pelosi's political posturing is to pretend she is doing a good thing by throwing a little money their way. Who does she think she is fooling with this trickle? Let us hope a waterfall does not await.
It's hard to say which is more frightening — the idea of the auto industry being run from Washington, D.C., or that experts like Economy.com's Mark Zandi say the Big Three will utilmately need $75 billion to $125 billion in order to avoid bankruptcy.
http://finance.yahoo.com/tech-ticker/article/140964/Big-Three-Bailout:-$15B-Just-a-Start-Whether-GMs-Wagoner-Stays-or-Goes
A broken industry with highly leveraged and unsustainable debt and obligations that cannot be paid, Speaker Pelosi's political posturing is to pretend she is doing a good thing by throwing a little money their way. Who does she think she is fooling with this trickle? Let us hope a waterfall does not await.
Homeowner Defaults Continue to Rise
On Friday we learned that 1 in 10 homeowners either fell behind on their mortgage or were in foreclosure as the U.S. economy shed 1.91 million jobs this year. Fed chairman Bernanke would like more taxpayer money to prevent a further slide.
http://www.bloomberg.com/apps/news?pid=20601087&refer=worldwide&sid=a37uyBrX6dvY
Today, Bloomberg's Kathleen Hays interviewed Comptroller of the Currency John Dugan who indicated that new data shows that more than half of the loans that were modified in the first quarter of 2008 fell delinquent within six months.
The new loans re-defaulted:
36% re-defaulted after 3 months,
51% re-defaulted after 6 months,
and 58% re-defaulted after 8 month.
A key question, Mr. Dugan said, is why is the number of re-defaults so high? “Is it because the modifications did not reduce monthly payments enough to be truly affordable to the borrowers? Is it because consumers replaced lower mortgage payments with increased credit card debt? Is it because the mortgages were so badly underwritten that the borrowers simply could not afford them, even with reduced monthly payments? Or is it a combination of these and other factors?”
http://www.occ.gov/ftp/release/2008-142.htm
Seemingly as the government throws more money into the housing situation, the slide continues. And this morning Governor Corzine of New Jersey told Bloomberg News that we should now halt foreclosures, not for 3 months, but 6 month.
Why not just give everybody a house?! How disturbing is it to those who have worked hard, saved, made their mortgage payments on time, and lived within their means and did so responsibly, to now have a government that cannot give enough of the taxpayers money away in order to save those who knowingly could not afford the house they bought and were gaming the system?
Quite frankly, I'm a little more than miffed. Well, somebody's gotta say it.
http://www.bloomberg.com/apps/news?pid=20601087&refer=worldwide&sid=a37uyBrX6dvY
Today, Bloomberg's Kathleen Hays interviewed Comptroller of the Currency John Dugan who indicated that new data shows that more than half of the loans that were modified in the first quarter of 2008 fell delinquent within six months.
The new loans re-defaulted:
36% re-defaulted after 3 months,
51% re-defaulted after 6 months,
and 58% re-defaulted after 8 month.
A key question, Mr. Dugan said, is why is the number of re-defaults so high? “Is it because the modifications did not reduce monthly payments enough to be truly affordable to the borrowers? Is it because consumers replaced lower mortgage payments with increased credit card debt? Is it because the mortgages were so badly underwritten that the borrowers simply could not afford them, even with reduced monthly payments? Or is it a combination of these and other factors?”
http://www.occ.gov/ftp/release/2008-142.htm
Seemingly as the government throws more money into the housing situation, the slide continues. And this morning Governor Corzine of New Jersey told Bloomberg News that we should now halt foreclosures, not for 3 months, but 6 month.
Why not just give everybody a house?! How disturbing is it to those who have worked hard, saved, made their mortgage payments on time, and lived within their means and did so responsibly, to now have a government that cannot give enough of the taxpayers money away in order to save those who knowingly could not afford the house they bought and were gaming the system?
Quite frankly, I'm a little more than miffed. Well, somebody's gotta say it.
Sunday, December 7, 2008
A Compelling Experience
Yesterday proved to be a most beneficial and enlightening day. Our expectation was limited to the description offered when we registered for this 8-hour Basic Handgun Safety Course at OFA, Oregon Firearms Academy. The majority of the day would be in a classroom situation and followed by a few hours on the range.
If you have an opportunity to do so, I would suggest participating in a class such as this, whether or not there is a plan to own or use a firearm, as the principles taught were those which every law abiding citizen should know and respect. It was a reminder of a state police sponsored defensive driving course taken many years ago, and in which I am thankful to have participated, for I do believe it made me a better driver.
Yesterday's content included some of the following:
- The basic understanding of proper, and therefore safe handling, of a firearm;
- Rules and regulations which govern handguns and their use;
- Responsibilities and serious liabilities which might be associated. . .
Paramount for me was the aspect of Awareness:
- Plainly and simply paying attention, in the moment, being constantly cognizant of that which is occurring in ones environment; focusing and not allowing oneself to be distracted so as to unintentionally be placed in harms way;
- being reminded that there are alternatives and choices to be made when one senses that something doesn't seem right;
- maintaining caution and in many cases yielding, but having preparedness (plan) if required to act. . .
Clearly there was so much more and all students carried away different thoughts regarding this outstanding course. The instructors were exceptional and the class exceeded all our expectation - an excellent learning experience and a very thought provoking and philosophical day.
One final note of interest: During one of the breaks another participant and I were discussing a situation in which she found herself recently: I walk with my dog for an hour each night following work, and the other evening I noticed a van parked in the distance on the same side of the road as I, and there was no reason I could think of for it to be there. I didn't want to turn around, so I took out my cell phone and began to talk while crossing to the other side of the road while keeping my sight upon the van and my dog close by. Within a very short time of that, the person and van left.
Whether or not this walker was in a harmful position, she reduced her risk by practicing Situational Awareness and personal safety. Focused, assessing what didn't seem right, an alternate plan was made and a possible conflict or danger averted.
Our hope is that we can all be that aware.
Should you be in the Pacific northwest area, you might consider:
http://www.oregonfirearmsacademy.com
If you have an opportunity to do so, I would suggest participating in a class such as this, whether or not there is a plan to own or use a firearm, as the principles taught were those which every law abiding citizen should know and respect. It was a reminder of a state police sponsored defensive driving course taken many years ago, and in which I am thankful to have participated, for I do believe it made me a better driver.
Yesterday's content included some of the following:
- The basic understanding of proper, and therefore safe handling, of a firearm;
- Rules and regulations which govern handguns and their use;
- Responsibilities and serious liabilities which might be associated. . .
Paramount for me was the aspect of Awareness:
- Plainly and simply paying attention, in the moment, being constantly cognizant of that which is occurring in ones environment; focusing and not allowing oneself to be distracted so as to unintentionally be placed in harms way;
- being reminded that there are alternatives and choices to be made when one senses that something doesn't seem right;
- maintaining caution and in many cases yielding, but having preparedness (plan) if required to act. . .
Clearly there was so much more and all students carried away different thoughts regarding this outstanding course. The instructors were exceptional and the class exceeded all our expectation - an excellent learning experience and a very thought provoking and philosophical day.
One final note of interest: During one of the breaks another participant and I were discussing a situation in which she found herself recently: I walk with my dog for an hour each night following work, and the other evening I noticed a van parked in the distance on the same side of the road as I, and there was no reason I could think of for it to be there. I didn't want to turn around, so I took out my cell phone and began to talk while crossing to the other side of the road while keeping my sight upon the van and my dog close by. Within a very short time of that, the person and van left.
Whether or not this walker was in a harmful position, she reduced her risk by practicing Situational Awareness and personal safety. Focused, assessing what didn't seem right, an alternate plan was made and a possible conflict or danger averted.
Our hope is that we can all be that aware.
Should you be in the Pacific northwest area, you might consider:
http://www.oregonfirearmsacademy.com
Saturday, December 6, 2008
The Velocity Factor
The Velocity Factor
Richard Russell Tribute
We need as much sound reasoning as we can get these days, and one such voice is and has been John Mauldin * who helps us understand the world of economics and investment, politics and science and how they all may come together in the future. To learn more about him, you may read here:
http://www.johnmauldin.com/biography.html
John writes and remits his e-letters to us regularly, and they are free. It is as simple as going to his http://www.frontlinethoughts.com/learnmore site and typing in your email address.
Yesterday's writing begins with a quote from Professor Nouriel Roubini of New York University:
Richard Russell Tribute
We need as much sound reasoning as we can get these days, and one such voice is and has been John Mauldin * who helps us understand the world of economics and investment, politics and science and how they all may come together in the future. To learn more about him, you may read here:
http://www.johnmauldin.com/biography.html
John writes and remits his e-letters to us regularly, and they are free. It is as simple as going to his http://www.frontlinethoughts.com/learnmore site and typing in your email address.
Yesterday's writing begins with a quote from Professor Nouriel Roubini of New York University:
He goes on to write of the money supply in our economy and that which begs for understanding, the velocity of that money supply. . . how it works its way through and affects our economy. To read it in its entirety, please go to his website."A severe global recession will lead to deflationary pressures. Falling demand will lead to lower inflation as companies cut prices to reduce excess inventory. Slack in labour markets from rising unemployment will control labor costs and wage growth. Further slack in commodity markets as prices fall will lead to sharply lower inflation. Thus inflation in advanced economies will fall towards the 1 per cent level that leads to concerns about deflation.
"Deflation is dangerous as it leads to a liquidity trap, a deflation trap and a debt deflation trap: nominal policy rates cannot fall below zero and thus monetary policy becomes ineffective. We are already in this liquidity trap since the Fed funds target rate is still 1 per cent but the effective one is close to zero as the Federal Reserve has flooded the financial system with liquidity; and by early 2009 the target Fed funds rate will formally hit 0 per cent. Also, in deflation the fall in prices means the real cost of capital is high - despite policy rates close to zero - leading to further falls in consumption and investment. This fall in demand and prices leads to a vicious circle: incomes and jobs are cut, leading to further falls in demand and prices (a deflation trap); and the real value of nominal debts rises (a debt deflation trap) making debtors' problems more severe and leading to a rising risk of corporate and household defaults that will exacerbate credit losses of financial institutions."
- Professor Nouriel Roubini of New York University
Friday, December 5, 2008
Automakers Give $50 Million to Congressional Members
Likely we have all had our fill of the automakers, their union representatives and the culture they have created, along with Congress. I chose not to view a repeat performance of today's groveling and sorrow and threats of a collapsing America unless we get more money now, while Congressional members interrogate and chastise as if they are above reproach.
Can you believe it? CBS is actually doing some investigative reporting: "The auto industry spent nearly $50 million lobbying Congress in the first nine months of this year. . . And people tied to the auto industry gave another $15 million in campaign contributions... ".
Senator Carl Levin received $438,304 from the automotive industry. And in the House, Rep. Joe Knollenberg received $879,327. Rep. John Dingell got nearly a million from the industry. All have enjoyed generous support from the auto industry over their careers, with GM and Ford as their two top contributors. Well of course these members of Congress will support a bailout.
But nobody's been a bigger advocate for Motor City interests than Dingell. And for him, the stakes aren't just political, they're personal. There's an actual conflict," said Ryan Alexander of the nonprofit group Taxpayers for Common Sense. "His personal financial health, you know, the wealth of his family is tied up in the car industry."
"Dingell's wife Debbie once worked as a lobbyist for GM. When she married the congressman, she became a senior GM executive at an undisclosed salary. And we found the couple has extensive GM assets. Dingell's current financial disclosure filed in May lists GM stock worth up to $350,000, options worth up to $1 million more, and a GM pension fund. In 2000, among the Dingells' GM assets were stock options worth up to $5 million. And in 1998, the congressman reported selling GM stock options worth up to $1 million dollars. Dingell wouldn't agree to an interview.
http://www.cbsnews.com/stories/2008/12/03/cbsnews_investigates/main4646424.shtml
Doesn't it all simply smell so badly? What a despicable racket we allow in government, and it is all really about money, the payola, isn't it?
Somebody's gotta say it.
Can you believe it? CBS is actually doing some investigative reporting: "The auto industry spent nearly $50 million lobbying Congress in the first nine months of this year. . . And people tied to the auto industry gave another $15 million in campaign contributions... ".
Senator Carl Levin received $438,304 from the automotive industry. And in the House, Rep. Joe Knollenberg received $879,327. Rep. John Dingell got nearly a million from the industry. All have enjoyed generous support from the auto industry over their careers, with GM and Ford as their two top contributors. Well of course these members of Congress will support a bailout.
But nobody's been a bigger advocate for Motor City interests than Dingell. And for him, the stakes aren't just political, they're personal. There's an actual conflict," said Ryan Alexander of the nonprofit group Taxpayers for Common Sense. "His personal financial health, you know, the wealth of his family is tied up in the car industry."
"Dingell's wife Debbie once worked as a lobbyist for GM. When she married the congressman, she became a senior GM executive at an undisclosed salary. And we found the couple has extensive GM assets. Dingell's current financial disclosure filed in May lists GM stock worth up to $350,000, options worth up to $1 million more, and a GM pension fund. In 2000, among the Dingells' GM assets were stock options worth up to $5 million. And in 1998, the congressman reported selling GM stock options worth up to $1 million dollars. Dingell wouldn't agree to an interview.
http://www.cbsnews.com/stories/2008/12/03/cbsnews_investigates/main4646424.shtml
Doesn't it all simply smell so badly? What a despicable racket we allow in government, and it is all really about money, the payola, isn't it?
Somebody's gotta say it.
Thursday, December 4, 2008
Treasury Suggests Subsidized Mortgages
Open your pockets for the Treasury department has another plan. They want to revitalize the housing market. While home prices continue to decline and foreclosures rise, they are considering intervening and subsidizing mortgage rates by offering a lower rate.
Treasury views this plan as potentially halting the slide in home prices by enabling borrowers to afford bigger loans, thus increasing demand and pushing up home values. The lower interest rates would be available only to borrowers who are buying a home, not those refinancing a mortgage.
http://www.smartmoney.com/breaking-news/smw/?story=20081204070212
What happened to allowing markets to dictate price, the fair market value... you know what a willing buyer is willing to pay. . . not a price dictated by the government?!
My ears and eyes cannot believe that which they are proposing now: to intervene and therefore peg the price of housing, create an unnatural floor, in other words, price fixing, manipulate the cost of a house. . . attempt to artificially inflate the housing market!
Plan on opening your wallet, for we could now share in helping someone else buy a house, despite the fact that you may not own one. But should you decide to buy one, pony up at a inflated government-dictated price, or better yet, wait for prices to likely fall again.
How do they come up with these bad ideas? Oh yes, I recall hearing redistribute the wealth.
Treasury views this plan as potentially halting the slide in home prices by enabling borrowers to afford bigger loans, thus increasing demand and pushing up home values. The lower interest rates would be available only to borrowers who are buying a home, not those refinancing a mortgage.
http://www.smartmoney.com/breaking-news/smw/?story=20081204070212
What happened to allowing markets to dictate price, the fair market value... you know what a willing buyer is willing to pay. . . not a price dictated by the government?!
My ears and eyes cannot believe that which they are proposing now: to intervene and therefore peg the price of housing, create an unnatural floor, in other words, price fixing, manipulate the cost of a house. . . attempt to artificially inflate the housing market!
Plan on opening your wallet, for we could now share in helping someone else buy a house, despite the fact that you may not own one. But should you decide to buy one, pony up at a inflated government-dictated price, or better yet, wait for prices to likely fall again.
How do they come up with these bad ideas? Oh yes, I recall hearing redistribute the wealth.
Wednesday, December 3, 2008
Bailout Monitor Sees Lack of a Coherent Plan
In an interview on Monday, Elizabeth Warren, chairwoman of the oversight panel for monitoring the enormous $700 billion bailout package, TARP (Troubled Asset Relief Program), said that the government "seemed to be lurching from one tactic to the next without clarifying how each step fits into an overall plan.
So if the banks are not lending, and they are not, then where is the money that has been pouring into them by the Fed and this program? Are the banks putting it back into the Treasury in the form of Treasury bills and bonds? Take a look at the IShares Lehman 20+ Year Treasury Bond (TLT) at http://stockcharts.com/h-sc/ui?s=tlt. It has gone parabolic in the past two weeks, but for yields that are at historic lows?
Such a game they play: the government takes our (taxpayer) money, gives it to the banks and brokers on Wall Street and in turn Wall Street will lend us back what is already ours and at a higher rate?
http://www.nytimes.com/2008/12/02/business/02tarp.html
Ms Warren, make them accountable.
“You can’t just say, ‘Credit isn’t moving through the system,’ ” she said in her first public comments since being named to the panel. “You have to ask why.”
If the answer is that banks do not have money to lend, it would make sense to push capital into their hands, as the Treasury has been doing over the last two months, she continued. But if the answer is that their potential borrowers are getting less creditworthy with each passing day, “pouring money into banks isn’t going to fix that problem,” she said.So if the banks are not lending, and they are not, then where is the money that has been pouring into them by the Fed and this program? Are the banks putting it back into the Treasury in the form of Treasury bills and bonds? Take a look at the IShares Lehman 20+ Year Treasury Bond (TLT) at http://stockcharts.com/h-sc/ui?s=tlt. It has gone parabolic in the past two weeks, but for yields that are at historic lows?
Such a game they play: the government takes our (taxpayer) money, gives it to the banks and brokers on Wall Street and in turn Wall Street will lend us back what is already ours and at a higher rate?
http://www.nytimes.com/2008/12/02/business/02tarp.html
Ms Warren, make them accountable.
Tuesday, December 2, 2008
The Incompetent Big Three
The big three, General Motors (GM), Ford (F), and Chrysler (private company) again groveled their way to Washington today and warned they could drag the entire industry down if they fail unless they get an immediate cash infusion of $34 Billion. Don't you find it curious that just the other day they requested $25 Billion, and today they raised the ante to $34? Just another $9 Billion! And think about this: GM alone has about $170 Billion in liabilities.
http://biz.yahoo.com/ap/081202/meltdown_autos.html
November 7, 2008, they were on Capitol Hill and sought $50 billion, half of which was meant to pay for healthcare and other benefits for retired autoworkers. They just keep coming back for more.
http://www.freerepublic.com/focus/f-news/2127848/posts
So today is another panic day, similar to the Paulson panic when he first announced the need for $700 billion. That's the way it's done today: scare the public into action, despite their having spent wastefully and known of their circumstance for years.
Consider this: if either you or I were as incompetent as these folks have been over the years in running their business into the ground, and I say knowingly, we would have been bankrupt and out of business a long time ago, and no one would be there to help. And truly they are incompetent and shameful.
http://biz.yahoo.com/ap/081202/meltdown_autos.html
November 7, 2008, they were on Capitol Hill and sought $50 billion, half of which was meant to pay for healthcare and other benefits for retired autoworkers. They just keep coming back for more.
http://www.freerepublic.com/focus/f-news/2127848/posts
So today is another panic day, similar to the Paulson panic when he first announced the need for $700 billion. That's the way it's done today: scare the public into action, despite their having spent wastefully and known of their circumstance for years.
Consider this: if either you or I were as incompetent as these folks have been over the years in running their business into the ground, and I say knowingly, we would have been bankrupt and out of business a long time ago, and no one would be there to help. And truly they are incompetent and shameful.
Monday, December 1, 2008
Lawyers Want International Court For Environment
Frightening, absolutely frightening is this radical proposal for an international court.
A former chairman of the bar council is calling for an international court for the environment to punish states that fail to protect wildlife and prevent climate change. Stephen Hockman QC is proposing a body similar to the International Court of Justice in The Hague to be the supreme legal authority on issues regarding the environment.
2008 Black Friday Weekend
The NRF (National Retail Federation) reported that a survey, conducted by BIGresearch, points to "more than 172 million shoppers visited stores and websites over Black Friday weekend, up from 147 million shoppers last year. Shoppers spent an average of $372.57 this weekend, up 7.2 percent over last year’s $347.55. Total spending reached an estimated $41.0 billion", or so they said.
http://www.nrf.com/modules.php?name=News&op=viewlive&sp_id=610
Why do I find this so hard to believe? It reminds me of the consistently optimistic reports by the National Association of Realtors who for the past year continually said that housing had bottomed as the actual numbers indicated just the opposite.
A former chairman of the bar council is calling for an international court for the environment to punish states that fail to protect wildlife and prevent climate change. Stephen Hockman QC is proposing a body similar to the International Court of Justice in The Hague to be the supreme legal authority on issues regarding the environment.
The first role of the new body would be to enforce international agreements on cutting greenhouse gas emissions set to be agreed next year.
http://www.telegraph.co.uk/earth/environment/climatechange/3530607/Lawyers-call-for-international-court-for-the-environment.html2008 Black Friday Weekend
The NRF (National Retail Federation) reported that a survey, conducted by BIGresearch, points to "more than 172 million shoppers visited stores and websites over Black Friday weekend, up from 147 million shoppers last year. Shoppers spent an average of $372.57 this weekend, up 7.2 percent over last year’s $347.55. Total spending reached an estimated $41.0 billion", or so they said.
http://www.nrf.com/modules.php?name=News&op=viewlive&sp_id=610
Why do I find this so hard to believe? It reminds me of the consistently optimistic reports by the National Association of Realtors who for the past year continually said that housing had bottomed as the actual numbers indicated just the opposite.
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