Friday, October 23, 2009

The Naked Man in the Limo Rode Over the Bridge

The Wall Street markets retreated this morning supposedly on the decline of home prices but it probably had more to do with the Fed threatening banks with stricter capital requirements, they would actually need to have some money before they borrow more from the Fed. They already increased the capital requirement to 13 to one, when they all collapsed last year it was 20 to one. This was regular banks, investment banks had been operating at 40 to one or worse. That’s gambling with $2.50 of their money and $97.50 of the public’s money.

If the new requirements are pushed through, the really big banks would have to issue a new class of bonds that would convert to equity if the bank fails, in other words, bonds that would become worthless like stock does. It doesn’t sound like much, but if enforced would force the super rich who buy these bonds to pay for their failures. This assumes that this isn’t all done with a wink and a nod. The rich really lost all their money in the bank crash last year but the rest of us are bailing them out at 100%. George Bush continues to ride in his limo while many of us are living in the old sedan or in a box under a bridge. The bastards.

When I say the rich lost it all last year, what I mean is their Ponzi scheme was revealed for what it is, the wealth the rich hold is just worthless paper. Unfortunately, most people only know what the corporate media tells them and still think the Emperor isn’t buck naked.

Initial unemployment claims are up again, continuing claims are down as another 100,000 or more Americans fell off the rolls and into poverty. One Republican Senator has a hold on the bill extending unemployment benefits, the bastard.
The median price of homes continues to fall, down 8.5% from last year. The government tax credit that has been boosting sales will expire shortly and even if renewed will result in a several month gap that will drive down prices more, putting more homeowners underwater.

The Fed put out its regular Beige Book summary of business activity on Wednesday and said "Reports of gains in economic activity generally outnumber declines, but virtually every reference to improvement was qualified as either small or scattered."
The view from under the bridge: A new CNN poll this week found that 42% of Americans now rate the economy as "very poor" worse than the 35% who did in August. Okay, 42% of Americans have noticed the Emperor has no clothes. www.prairie2.com

Thursday, October 22, 2009

the price of moose meat in Brazilian Reais

Sarah Palin has suddenly discovered the frightening new world of international currency trading. OK, not really, she has no clue why the Dollar is strong or weak or what that means or how it got there. But the headlines say the Dollar is "weak" and that’s a good talkin’ point, you betcha. It makes Obama look weak or evil or something. With the corporate media talking up the so called stock market rally, her kind need something, anything to keep Obama from looking good. They desperately need to blame the steam roller of poverty that is overtaking their followers on Obama and not on the people who are really turning them into corporate serfs.

Palin can rant about how Obama’s pay czar will be cutting their pay but that’s dangerous ground with the growing populist outrage about multi-million Dollar salaries for people who don’t do anything productive. Headlines that say Obama has cut those parasites pay by 50% are hard to spin but tying him to a weak Dollar makes Obama look to be to blame for the pain and suffering on main street since he’s destroying the American Dream. The Dream that your parents can pay $60,000 for you to get a Harvard MBA and pull strings at the country club to get you a job on Wall Street starting at 400,000 and you go on to make billions in the derivative market. You know, just pull yourself up by your bootstraps. Okay, maybe she won’t tell her people that.

Palin could rightly say to her followers that the weak Dollar will make everything they buy at Walmart a lot more expensive since it all comes from China and the Dollar buys less and less everyday. That might be a bit dangerous because at some point her followers might want to know why everything at Walmart comes from China. Instead she will doubtless tell them they will lose their jobs because the weak Dollar will hurt US exports. Of course in theory just the opposite is true. Not that those theories really matter much to those living in the wreckage of our economy. Palin’s followers had better be canning moose meat. www.prairie2.com

Wednesday, October 21, 2009

Round up the usual suspects

The value of the Euro went above $1.50 today for the first time in 14 months. Oil was approaching $80 but fell back on release of inventory data showing a glut of diesel fuel as the collapsing US economy makes it difficult for refiners to cut production far enough to keep the supply down. Traders were hoping to drive oil above $80 so that the large number of pending futures contracts would be activated forcing people to buy oil to cover their positions and driving the price still higher. The usual suspects like the "too big to fail" banks are hoping to make a killing.

Currency traders, also working for these same criminal enterprises, have been driving up foreign currencies by dumping huge amounts of Dollars (the Dollars they got from you and me for free), dumping them in countries with a strong currency like Brazil. This conversely drives down the Dollar and oil goes up ever closer to the triggers on all those futures contracts they own. It takes money to make money. It helps if you get that money for free and have no conscience. Jiminy Cricket is under glass in the CEO’s office with a pin through him. (a bit of history: some of Mickey Mouse’s biggest hits in the 30’s fed on the popular outrage over bankers throwing people out of their homes, the Sheriff was often the bad guy in early cartoons)

You can learn a little bit about how the usual suspects are able to loot and pillage our economy by watching the FRONTLINE episode The Warning that features the adventures of Brookslyey Born as Chairman of the Commodity Futures Trading Commission during the Clinton Adm.

Not to give away the plot but we do know how it all turns out; our heroine Brooksley Born is summoned before the most powerful man in the world and told by the Dark Lord Allen Greenspan that The Market will deal with fraud and she need not concern her agency with such things as enforcing the law. This meeting took place before she suspected that there was any systemic fraud going on. It would be ten years before the Ponzi scheme she tried to stop would grow to more than 600 trillion Dollars (maybe a 1000 trillion) and collapse. (the entire world GDP is less than 60 trillion)

My only problem with the FRONTLINE presentation is that they let Greenspan off as basically just being a fool. The man is a criminal with no equal since Hoover’s Sec. of Treasury Andrew W. Mellon, who single handed created the last Great Depression. Melon had a personal fortune would make Bill Gates look like he digs under the couch cushions for cigarette money. Mellon was put on trial by the FDR Adm. but died before the verdict. Greenspan’s pretense of stupidity is doubtless aimed at avoiding the same fate. Greenspan’s Doctoral Thesis was on land boom of the twenties that precipitated the crash and apparently served as his blueprint for running the Fed and creating the current Great Depression. The only question is do we have a new FDR? Greenspan would look good in an orange jumpsuit. www.prairie2.com

Tuesday, October 20, 2009

The Red Phone is ringing and the Republicans want to cut the wire

The right-wing had a fit over Obama’s canceling of Bush and Cheney’s ABM installations in the former Warsaw Pact countries on Russia’s frontier. Even worse by their thinking he reached an agreement for each side to further reduce their strategic warheads.

Well, the Republicans aren’t done trying to bring on Armageddon, they are doing everything they can to meddle in the negotiations for a new START Treaty replacing one from the Soviet era that will expire in a few weeks. Under the treaty we and the Russians each have 30 inspectors keeping track of the other’s arsenals. The Obama Adm. is trying to negotiate a treaty to further reduce delivery vehicles, bombers, ICBMs and submarines.

The Republicans in the Senate have said "Hell NO" we want new and better bombs. Since no treaty can pass the Senate without at least seven Republicans (2/3 being 67 votes required by the Constitution), so a treaty is out of the question. Sec. Clinton just recently left Russia and hopefully she carries an Executive Agreement for the President to sign that will keep the existing treaty in effect.

The Republicans would like to funnel many billions into building a new production line for a next generation of warhead. New warheads haven’t been built since Reagan’s Peace Keeper missile. These were taken out of service with the SALT treaty but the nose cones were retained. (they shipped some to Taiwan by mistake) These have been used to modernize old Minuteman II missiles and the Russians weren’t very happy about it but Bush dressed up in his codpiece and did as he liked, he didn’t believe Soviet treaties applied to the Russians. That’s why we are coming down to the last minute and Obama has to cobble together a gentleman’s agreement to keep the world from ending. He’s doing this over the Republicans’ objections and they will do everything they can to stop him. They really hate that Peace Prize, it doesn’t have a plutonium core. www.prairie2.com

Freeper Flu

I have a hard time with articles that concentrate on the crazy freeper stuff as if that was the real concern and by refuting them they have dismissed everybody else too.
http://www.factcheck.org/2009/10/inoculation-misinformation/#

I am not opposed to vaccine per se, but I would like them to be tested by a disinterested third party. A study published in Lancet a couple of years ago said no flu vaccine had ever really been tested and the death rate in the elderly does not change from year to year regardless of the composition or availability of vaccine. I'll be interested to see if a real study of this current outbreak is ever undertaken.

The facts are that these vaccines are being made by same old killer corporations so you can't assume they are safe. The government didn't test them for safety or even if they actually worked, just to see if they produce an immune response, that isn't the same thing. I'd like to see a follow up study on people vaccinated. When they say the method used to produce the vaccine is the same "except for the virus"; that is a very big "except". Then we come back to; does the seasonal vaccine work? Finally, even if this vaccine is safe and effective, you still can’t trust these bastards. Even the most corrupt cop will lock up the occasional bad guy, that does not excuse him.

Expecting it to work because it sounds good is not a substitute for actual legitimate studies.

Some actual facts: the H1N1 virus that is going around is a hybrid of swine, human and bird flu. the first H1N1 to be identified was found in hogs in the 1930s hence the "swine" name, until electron microscopes they couldn't "see" viruses and had to infer their properties. The letter/number designation has to do with the shape of the virus and not its source or who or what gets it.

pigs do get this strain and it has been going around in mega hog farms since sometime in the 1990s. Why it jumped to humans in the villages surrounding a million hogs per year Smithfield factory farm in northern Mexico is unknown but probably because the people were exposed repeatedly until a mutation occurred. Flu mutates very easily and can even pick up protein snippets from its host. Unless you keep pigs you probably don't have any resistance to H1N1 since it hasn't gone around in humans since 1918.

The thing that determines how well an individual virus strain spreads is its ability to attach to and absorb blood sugar molecules found in different species. This is why they don't jump easily from birds, pigs, people, etc. They can spread but if they can't absorb sugar easily, they don't survive or reproduce fast enough to cause disease before being destroyed by the immune system. Until it mutates.

Monday, October 19, 2009

Making Money the Old Fashioned Way

The Fed is testing a system for handling transactions designed to suck up surplus cash by issuing special bond instruments called Reverse Repurchase Agreements to securities dealers in exchange for cash. The Fed would guarantee to buy these back for cash after a fixed term at a loss for the Fed. In the meantime Securities dealers could use them as collateral to borrow money from banks. They claim that this would keep inflation down by reducing the amount of liquidity in the money market mutual fund industry and keep down the interest rate that they pay. I’m not sure it really takes money out of circulation but Wall Street will make a lot money in the process.

The Fed has officially pumped 800 billion into bank reserves in the past year and the fear is this could trigger inflation if the banks decide they are willing to part with any of it. The truth is that the Fed has created tens of trillions of new dollars by any number of convoluted schemes and we only get the occasional hint of what they’ve been up to. The goal of all this paper pushing is to make it look like the financial services industry isn’t just a large parasite on the back of the economy sucking us all dry.

This brings us to the situation of a California man who lost his savings to the convicted Ponzi schemer Bernie Madoff. Unlike millions of other Americans he has managed to find work, all be it as door greeter. His boss says he is an inspiration to us all.... But since he has been forced to go back to work at age 95, he should not be an inspiration but a wake up call. There will be many millions of people who won’t be able to retire since their 401k(s) and pensions have been looted by the financial services "industry". Don’t kid yourself that the market is going to stay up. Predatory capitalism needs prey and the hunting is getting thin.

By next year the majority of US workers will be women, this is up from 40% when Ronald Reagan campaigned for a return to 1950 when women were 28% of the work force. He actually ran for President on the idea that too many women were working. Of course, his policies were really aimed at every women having a job so that overall wages could be driven down and the middle class destroyed. In 1980 it was not difficult for a family to live on a single income, now two or three are required to have the same standard of living.
Today, women are increasingly becoming the main breadwinner in families. Not because they are making more money but because the jobs their husbands trained for have either been out sourced or have disappeared entirely with the collapse of the economy. Door greeting simply does not pay that well. Many men (and women too) have retrained several times as career after career disappears and all they have to show for it is student loans they have to repay with ever smaller incomes.

The official advice being passed out to men at state job counseling offices is "Forget about ever getting a job like you had and go after a women's job". Why don’t they tell them to buy Reverse Repo’s with money that came free from the Fed and make a guaranteed return? Oh, that’s right, that’s only for the 1/10 of one percent at the top that made their money the old fashioned way. By stealing it. www.prairie2.com