Saturday, March 10, 2012

Welcome to the new Troll

We have a brand new Troll today that went through posting the same old talking points. He even posted three separate talking points to the same article, so I suspect he gets paid by the comment. Oh well, it's stimulus for the economy. Clearly he didn't bother to read anything first, as the most of his points don't line up that well, probably just cut and paste. I'm too tired today to tear the guts out of his poorly informed comments, even to hold them up to hear the roar of the crowd. Would anyone else care to do the honors, or is it just too easy?

Friday, March 9, 2012

Remember where you parked

Another month has gone by and Obama the socialist, Kenyan mao-mao Marxist, job destroyer has plunged the country deeper into the Clinton Great Depression, (wait, what’s this) 428,000 new jobs according to the Bureau of Labor Statistics household survey? And now we’ve had two full years of positive job growth? By all that’s holy at Fox News, say it’s not so! You can hear the moans from the ghost of Andrew Breitbart, (Times aren’t so good over at the far right.)

The corporate news doesn’t report the 428,000 new jobs number preferring the employer survey that reported only 227,000 new jobs. Keep in mind that the now non-existent Presidency of George Bush produced exactly zero net jobs in eight years. (Republican historians skip directly from Clinton to Obama these days)

Even the private sector employer survey number is really 6000 jobs greater at 233,000, but the red states continue to shed government workers. The damage this austerity is doing to their economies is becoming ever more obvious, and the redder the state’s governor, the worse it is. Wisconsin, under the notorious Scott Walker (a wholly owned subsidiary of Koch Industries), Wisconsin has the distinction of being the only state with six months of continuous decline.

Walker keeps trying to stall his re-call election, but this may in the end only result in the FBI “recalling” him before the voters can. Half a dozen of his staff are already under felony indictment for running a “pay for play” scheme on taxpayer time right out of his office.

Gas prices leveled off early this week and actually fell back a penny. Oil companies are circulating the talking point that they are merely discounting winter blend gasoline to get rid of it, and prices will resume the march toward $5/gal next week. Wait a minute, I thought gas prices were set by the “market”, what do you mean the oil companies lowered the price?

The fact is that the Wall Street banks have been buying up as much gasoline futures contracts as possible in order to create a phony shortage. They are party to as much as 90% of daily trading, and the hedge funds are hoarding gasoline in every tank farm and offshore tanker that they can get their hands on. But with so much gasoline and such weak demand, they may have already reached their peak of influence.

If Obama were to announce the release of strategic reserves like he did last year, it would burst the bubble. Remember paying $6 at the pump last Labor Day? It was unanimously predicted this time last year and it didn’t happen, and it won’t happen now. In fact some hedge funds may take a real beating having bet heavily against Obama. There could be a lot of that going around this year.

Before anybody sends me nasty emails for being an Obama apologist, let me point out again, that he hasn’t fixed the economy. He’s just holding the Red Sea at bay, the corporate chariots are still bearing down on us. It’s up to the rest of us to get organized and make the crossing to the promised land.  [Now where did I park that cart full of canopic jars?]

Tuesday, March 6, 2012

Coloring between the lines, and only using the red crayon

The stock markets in the US dropped 1.5% today from the renewed sturm und drang over the potential Greek bond default. The Euro zone is trying to force a 50% haircut on the holders of Greek bonds in order to avoid their default, but the catch is that it has to be “voluntary”. If it’s not, it becomes an “actual” default and those CDOs (credit default swaps) start kicking in.

About 15% of Greek debt is held by investors not covered by Greek law, and they can’t be forced to accept the “voluntary” haircut. CDOs are a type of derivative and there are many hundreds of trillions worth of these contracts in existence for all manner of things. The question is whether a Greek default would set off enough of these financial WMDs to create an unstoppable chain reaction.

The problem with these insane contract arrangements is that they can be triggered by any significant down turn, not just by a major default. A down grade in a credit agency’s rating of a bank or a nation state will do it. They’re all done in secret, so we have no real idea what the risk really is. It was a cascade of derivative failures tied to consumer debt (mostly home mortgages) that brought us within a hair’s breadth of ending civilization in 2008.

It was only the printing of trillions of USDs by the Fed that kept things going through the crisis, but we have no way of knowing if that will work a second time or not. At least this time around we have President that doesn’t need to have the briefing books read to him while he colors the pictures.

Unfortunately it’s not clear if the people writing the briefs really know what they are talking about. They have had three years to figure it out, and the Dodd-Frank Act gave them authority to do something about it. The Republicans in Congress however have refused to fund these activities, so we could looking at the conflagration of all time, but the fire trucks are all up on blocks.

Even if this Greek tragedy is avoided, or this simply isn’t the “big one”, we are still not on anything that could be called the right course. The Euro countries other than Germany are in for a rough ten years at best, and there are those who don’t want a happy ending at all. The same people who have been using the IMF to loot and pillage the third world are doing the same to Greece and won’t stop there.

Here in the US, none of the economic fundamentals have been corrected, everything is still being run in favor of the very few. The only good thing is that more people are catching on to the truth of the problem, our economy really belongs to the very many, and needs to be run that way.