The Mojo is all back in the sixties or the thirties

The Anglo-Irish bank was likely to be bailed out by the Irish government but that is now in doubt with the cost of Credit Default Swaps on Irish bonds having gone through the roof. This will make it extremely difficult if not impossible for Ireland to finance new debt or to recycle their old debt. This is the inevitable result of following the kind of austerity program conservatives are trying to force through in the US. Austerity kills the economy and debt can’t be repaid, the panic spreads until fascism takes over. Ireland and Greece aren’t the real targets here but just a breach in the wall.

Back in the US, stocks were down sharply today and weighing heavily were Bank of America, Citigroup and JPMorgan Chase who all lost around 2.25%. Credit card company American Express slid more than 4%. The official reason for the decline was the rumor that the European banks are in worse shape than the official report prepared by the European Central Bank but more likely it’s because the UK has signaled it will join in on a EU proposal to more heavily regulate and tax the big banks.

This would include the foreign operations of the big Wall Street banks and it probably isn’t that they’re concerned about the modest taxes being proposed but the increased transparency that would result that worries the banking insiders. You see the roaches don’t like it when you turn the light on and some might not avoid being crushed before they get back under the ice box.

Somebody else at the light switch is Securities and Exchange Commission Chairman Mary Schapiro, she stated in speech before Economic Club of New York that the SEC is taking a hard look at Wall Street practice of “quote stuffing”. This is where some stock traders place an average of 90 buy or sell orders for every trade completed.

These quotes are often cancelled within a fraction of a second and are used to manipulate the market creating the illusion of a price move that doesn‘t exist. The unwary trader can find that he has just bought a stock that is moving the opposite direction from what his own computer said it was. This came to light during the investigation of the flash crash in early May but supposedly this wasn’t the cause of those instantaneous through the floor price drops, no official reason has yet been given.

The SEC is also going to look into Dark Pools where huge volumes of stock change hands without going through the official exchanges but are reported as anonymous over the counter trades. This business used to be known as the “upstairs trade”, this term was historically used in the saloon business, (did you ever wonder why Miss Kitty had all those girls working at the Long Branch?). In the old days reputable exchanges didn’t allow this kind of activity but it’s now becoming common with many large banks as well as the exchanges running their own operations. It conceals who is selling what and for how much. That whole Libertarian, let the markets decide everything dogma falls apart quickly when it comes to the real world of separating the suckers from their money.

President “they talk about me like a dog“ Obama has announced he wants to save the US economy by spending 50 billion on infrastructure upgrades. He sounds as silly as Mike Myers when the newly thawed out Dr Evil wanting “one million dollars” to not destroy the world. The Republicans and Clinton neglected two trillion dollars in infrastructure maintenance over the last thirty years, people have already forgotten that a interstate bridge in a major city collapsed. Two trillion doesn’t include increasing capacity to handle the 50 million new Americans since 1980. It also doesn’t provide anything to build a 21st century infrastructure like China is doing, or do anything about energy production or a new manufacturing base to fix the trade deficit.

Not only has Obama been channeling sixties rock icons but he’s using 1960s numbers. Hey, Doctor Evil, tell Congress we need FIVE TRILLION DOLLARS, you’d be just as likely to get it (the party of No is still running things) but at least it would get it across to the American voter just how “freak’n” messed up the Republicans have made this country. Obama needs to go back in time and get his Mojo back or at least start channeling one of the Roosevelts instead of Jimi Hendrix.

This just in: Obama has just said there will be no compromise to extend the Bush tax cuts. These will expire after ten years because they were passed under reconciliation between the House and Senate requiring only 50 votes plus the VP. The Democrats could pass a massive economic program in September this way but they don’t have their Mojo either, instead they continue to hope their bad poll numbers continue to be slightly better than the Republicans.   www.prairie2.com