Monday, March 29, 2010

The numbers you don’t want to hear; today’s list only

After well over a year in office, President Obama finally did fifteen recess appointments out of 77 that had been waiting for a Senate vote. But wait, this is much worse than it appears. Another 217 nominees haven’t cleared the respective Senate committees, the 77 have all been approved by the Senators that have oversight. This mushrooms out from there as these people would all hire staff and deputies in lesser positions who would also hire people and so on and so on. The Republicans do know how to make a really big mess, oh that’s right, government doesn’t work!

The security services aren’t having positions filled either, in case you were wondering why they couldn’t connect the dots on that underwear bomber. The only reason we have anybody running the CDC and Health Services is because of the H1N1 scare. The recess appointments were heavy in the DOJ, the Commerce Dept. and Trade Representatives. (a trade war is heating up you know)

Four more banks were closed Friday at a cost of 320 million bringing the total to 41 so far this year. The number of banks the Republicans have driven into the ground is often pooh-poohed as not a big deal. In reality, these are often large chains of banks so any comparison to previous Republican banking disasters is hard to make since the size of banks used to be restricted to keep this from happening again and again.

Remember the Libor rate? London InterBank Offered Rate, this measures what banks are charging one another for money and this trickles down into all corporate money exchanges. The last time we heard from this troll under the bridge was when everything froze in September 2008. Normally credit costs are measured by the difference between Treasury bonds and the Libor rate. Treasury Bonds being considered the “safe” money and Libor not quite “safe” this gives you positive number (always).

Last week it flipped with the Libor dropping below Treasuries. If this continues it will indicate that the market no longer considers the debt of the United States of America to be the “safe” money. Nobody has come up with a good reason why this happened. It could be the big banks are just flexing their muscle to show Obama whose the boss. It could be China throwing their weight around. It could that the economy is too weak to create enough demand for US debt and interest rates will skyrocket. One theory is that they are all just stupid. I like that one.