Saturday, January 12, 2013

9-9-9 and other scams

Initial unemployment claims are up by 4000 for last week, but down a 100,000 from this week last year. You remember this time last year, when the 'collapsing' economy made the Republicans certain that Obama would be a one term President, and Herman Cain would save us all with the 9-9-9 plan.

Jack Lew will be the next Sec of the Treasury. On Capitol Hill he's know as the 'negotiator from Hell' from his years in the Clinton Administration budget negotiations with Congress. Newt said that the economy would collapse as a result of the deal Lew got, it boomed instead. On Wall Street he's strikes the sort of fear that an Archangel does among the wicked.

Speaking of the Wicked on Wall Street, it seems the Red Chinese have been running a Ponzi scheme  in the hundreds of billions, many hundreds of billions. Forty or more China based companies listed on the several New York stock exchanges have been simply stealing investor money, mostly from pension funds and small investors.

How do you get a company that has no assets and does no business to have their stock listed on the Dow and Nasdaq exchanges? It appears that lavish bribes will do the trick. All of the major US auditing companies that have branches in China appear to be implicated, as well as all the other so-called 'gate keepers' that are supposed to keep the barbarians on the other side of the wall. Even officials of the exchanges themselves are likely in on it, or are just incredibly stupid.

So far this doesn't seem to be having any effect on the markets, but at some point pension funds will need to raise cash, and the losses they took accounted for. I noticed today that the price of canned goods is up, just say'n....

Negotiating with crazy people

It appears to be official that senior Dems in the Senate are endorsing Obama's intention to just keep paying the bills even if Republicans refuse to raise the debt ceiling. Word is that Treasury has ruled out minting coins to cover the debt, even though that would be perfectly legal. Rumors continue to swirl that Obama will cave in, 'based on past performance' is their claim. The thing about that is Obama has not really given up anything so far. It sort of like the hostage negotiator, he can say what ever he wants, but it's the outcome that matters. The crazy guys in the House holding America hostage don't really have the upper hand, no matter what the talking tea bags in their head are telling them.

Tuesday, January 8, 2013

Reality can be defined as the 'norms' that your community agrees on.... Do you believe in witches and demons? How about 'trickle down economics'? Of course some 'realities' work better than others. The laws of nature tend to favor 'actual reality' over the ones that only exist in certain peoples' twisted world view, but over the short term utter nonsense can seem real, and even drive actual 'reality' to places we can't imagine.

We're in one of those places in time where 'reality' is being defined by consensus. We have a Federal budget in the $4 trillion range, a number that seems like magic to people who count only on their digits (fingers and toes). To be fair, it's not a number you can actually 'think' about. You have to use certain tricks of the mind to make it into a useful concept, or you can just use accounting....

We are creating about $1 trillion a year in new Federal debt, this freaks out the tea baggers. They didn't notice when Bush was creating debt at twice that rate, or when Reagan was doing it at twice that rate in today's dollars. You see it's all about 'creating' reality. Numbers are funny that way.

The Republicans are trying to create the 'reality' where where we simply default on the debt they created. If they can really make this 'happen', then civilization as we know it will end. You see the 'debt ceiling' crisis isn't about paying the 'bills', it's about paying the interest on Ronald Reagan's debt. He ran it up from less than a trillion dollars to 4 trillion while he was President. That would be 12 trillion in today's dollars.  Yeah..... when the right makes a big deal about Obama having a $16 trillion dollar debt, it's really Ronald Reagan's debt that they are talking about. That 'welfare' state that they obsess about? The interest on Reagan's debt comes in at twice what that costs every year, has been for 30 years.

Obama has cut the operating deficit to the point that if the economy were to recover we would be pretty close to running a surplus. The question is whether the economy will be allowed to recover. A default on Ronald Reagan's debt would make that unlikely, that's why the billionaires are trying to make that a 'reality'.

The good news is that Democrats in Washington seem to be catching onto 'reality'. Nancy Pelosi is talking about the 14th amendment, Barack Obama has said that Congress cannot refuse to pay for the spending they've authorized. This is 'reality' talk.

If you haven't heard about the 14th amendment, one of things in it says is that the debt of the United States cannot be questioned no matter how it was incurred. Basically, if Congress says that the Executive Branch should spend the money, they can't refuse to pay the bills later. That amendment was written to cover the debts of the Civil War, but has no limitation. The debts run up for every war since are similarly covered, The Spanish American War, WWI, WWII, Korea, Vietnam, Grenada, Panama, Iraq, Afghanistan, Iraq again, it includes every real, and every phony war that we've ever been involved in. That would also include the war against the middle class by the rich.

We've always paid our debts, going all the way back to the debts run up by the Continental Congress to pay for the exploits of George Washington. If you haven't heard of him, his likeness is on the dollar and the quarter. He was a liberal, that's something else you aren't supposed to know in this 'reality'.

That 'reality' is that we don't have a 'debt problem', we have a revenue problem. Corporations are hoarding 5 trillion in cash, rich people are hoarding more trillions in offshore accounts.

In another area where reality is being redefined, the the average temperature in the US for 2012 was one degree above the previous all time record, and three degrees above the average year in the 20th century. In Australia, scientists have had to add a new range of colors to the weather maps, shades of purple now define temperatures above 130 degrees. Back in the US, Kansas had the distinction of experiencing summer temperatures higher than the normal temperatures of Death Valley. Not in the 'purple' range yet, but the century is young.

In the end we will have the 'reality' that we choose as a community. Have you decided?