Friday, January 18, 2013

Republicans blink, sort of

The Republicans gave in to raising the debt ceiling, but only for three months worth. They want to attach a bunch of nonsense to it about passing a budget as if the House is able to do that. The Ryan budget that they've passed twice is just crap, and they aren't likely to pass one unless the same Republican block that voted with Pelosi and the Dems on the Fiscal Cliff will cross the aisle again. Since an actual budget isn't necessary to pass out money to their cronies, don't hold your breath.

This does mean however that Obama continues to have the upper hand, this is a solid victory. The Republicans will continue to cast about for some reason to impeach him but they're not likely to find one. So we can probably forward to this nonsense every few months, or maybe they will just give up. What's happening now is good to the extent that it does give Democrats something to campaign on. Perhaps President Warren will have a solid majority to work on getting real reform.

Thursday, January 17, 2013

Sometimes you're chumming the water and realize you need a bigger boat

Jobless claims fell by 35,000 last week to a five year low, and the number of people leaving jobs voluntarily is way up. This indicates that there is enough competition for workers that people can again feel comfortable about changing jobs. In theory this should drive up wages, but of course the Mitt Romney class continues to target good paying jobs for export.

Walmart claims it will ad $50 billion in additional American made products, but this is over the next ten years. On a yearly basis this is really only 1% of their current sales. Some things are simply cheaper to make here, with Walmart's growth rate they will outsource far more jobs in the next ten years than that $50 billion represents, even if they keep to the letter of their 'commitment' to buy American. Every new Walmart results in 200 local middle class jobs being permanently reduced to 'working poor', this doesn't count the factory jobs lost or the local jobs they supported.

The Republican planned default by America is less than four weeks away. It more tricky this time around to calculate the exact moment of the Apocalypse with tax refunds going out this time of year complicating the government's cash flow. How much the IRS pays out can vary from tens of millions one day to tens of billions on another day.

It's too bad they nixed the platinum coin plan, my own crazy idea would be to mix trace amounts of platinum into the check printing ink, then just print coin shapes on the checks and let banks redeem them at the Federal Reserve. The platinum could then be easily recycled.

The righties like to screech that we borrow a quarter of the Federal budget from China, we don't of course. The communists haven't purchased any significant amount of Treasury bills since 2006, and even then they paid for them in USD. If we were really borrowing from China your tax refund would be denominated in Renminbi (the People's currency). The other name for Red Chinese currency is the Yuan which means simply 'round'.

The only reason Greece is in trouble is that they let billionaires get away without paying taxes. Who would be stupid enough to do something like.... oh yeah our Republicans do that, and tell us that's a good thing for 'job creation'. The Greeks don't have their own currency, they use German Euros.

That's right I called them 'German' Euros. Germany is the Great White Shark in the goldfish bowl, and they're doing just fine. Greece is now obliged to literally sell the entire country for pennies on the euro to the fat cats. Who would be stupid enough to sell the country's entire infrastructure to the private sector for pennies.... oh yeah, here the Republicans do that and call it 'privatizing' like it was a good thing.

Germany's central bank is moving a big part of their gold reserves to Germany. The Bundesbank is 'repatriating' 375 tons from Paris, and 300 of the 1500 tons that they have on deposit with the NY Federal Reserve. There's no official reason why they're doing this, other than German pride. They lost all their gold after the war of course, and this represents accumulated foreign currency reserves. They moved a thousand tons from the Bank of England in 2001 because the Brits were charging them for storage. This had been a secret that only came out recently in an audit report. The US and France don't charge for keeping it, but the Germans are moving it anyway.

Gold is up about $20/ounce this week, but probably not over this German action. It's still about $200/oz below its peak. The rightwing 'experts' still want to sell you gold, guns and dehydrated food. That Mayan panic might be passe, but the Kenyan troops are coming any day and you need to be prepared, or was it Mayan troops? I can't keep the crazy talk straight. That's not to say that I'm recommending you lean over the side of the boat when applying chum. There are things out there that will get you, but they're the same sharks that put out the rightwing talking points every morning.

PS Harpoons on ebay (this is true) start a 19.99, a good one is only $70. Guaranteed to penetrate the rightwing blubber, or your renmindi back.

Tuesday, January 15, 2013


The mega store chain Walmart, that one that likes to drape itself in Red, White and Blue in order to better sell its Communist Chinese goods, has announced it will 'create' 100,000 jobs for military Veterans. Why will it push 100,000 already poor people out of the way in favor of giving poverty wage jobs to the veterans of George Bush's imperialist follies? Because it will get hundreds of millions in cash from the government for doing so. They wouldn't do it otherwise, this isn't without risk. These people are trained in combat, and have served under fire...

Even more risky for Walmart is that these people have been instilled with certain 'liberal' values. Things like real teamwork, where all pull together for the whole, and 'no one is left behind', the kind of thinking the Walton family really doesn't want their workers to even dream about. After all the five Walton heirs have accumulated in just 30 years more wealth than the bottom 40% of the entire United States of America, and they're only getting started.

Back in Washington, Republicans are dearth to talk about any actual cuts to the budget, but one thing that keeps bubbling up is Medicaid. Republicans can't resist a chance to kill some poor people by denying medical care, but with 2/3 of the budgets for corporate owned extended care facilities dependent on Medicaid, it's a real dilemma.  These institutions are everything from the local nursing home and the small town hospital up to the specialist corporate hospitals that really, really make a lot of money. Their budgets will essentially evaporate if Medicaid were to be cut to any degree.

Conservatives constantly harp on the notion that charity should only be done by churches, but Christian charities also get 2/3 of their budgets from the Federal government. Why do you think the Bishops were outraged by the Ryan budget? If you are cynical about their true motivations, you might think it's because it would put them out of business.

The notion that there would suddenly be more money in peoples' pockets to give to charity, if there were no government, is absurd on the face of it. Massive unemployment, collapsing economy, deflation, and so much more.... They'll tell you that anyway, they aren't big on that math stuff. Numbers have a liberal bias, as do colors and shapes. Never mind what that 'liberal' gravity will do to the conservative 'true believer' who thinks he can fly.

In short Republicans don't want to cut any real money out of the budget. Sure they want to make as much misery as they can, but the money still has to keep flowing to the 'disaster capitalists'. They have to take care of the very rich who hold the remote control to that electrically charged clamp around their privates. The good news is that Anonymous is working on getting the activation codes....

Monday, January 14, 2013

The end of the world, within the margin of error

President Obama did a press conference today where he proceeded to beat up the school bully, I mean call out the Republican slackers who don't want to pay for the spending that, well the spending that they did. It's disgusting how many Americans think that the President simply spends money as he wishes. In fact he can't spend a single penny without authorization from Congress, most of it is mandatory spending that he can't refuse to act on.

President Obama, "These are bills that have already been racked up, and we need to pay them. ... So ... Republicans in Congress have two choices here: They can act responsibly and pay America's bill or they can act irresponsibly and put America through another economic crisis."

In fact if Obama were to allow things to play out the way Republicans swear that they want them to, it could well end Western Civilization. This is not hyperbolic ranting from your economics correspondent, less than this has done more damage. If you think the 'rich' won't let that happen, you haven't been paying attention. Most of the 'very rich' got that way by employing 'disaster capitalism', or simply screwing people weaker than them. Hoarding cash and then buying real wealth for 10 cents on the dollar is a tried and true method, and they are angling to do that now. The founders of this nation warned against cycles of inflation and deflation brought on by bankers, calling them more dangerous than armies. Holland had collapsed a 150 years before, and France was collapsing at the time. Indeed the US went through many of these cycles. The New Deal ended all of that until Reagan unleashed the demons again, and they still run amok.

The good news is that clearly Obama is no Herbert Hoover, he will act. He's says he won't invoke the 14th Amendment or mint any platinum coins. The thing about this, is that his rhetoric is right out of the 14th Amendment, word for word. 

There are any number of possibilities for paying the bills with something that is 'not currency' that the Federal Reserve could redeem for cash, so him dismissing the coin option doesn't mean he won't do essentially that in the end.  

Obama is backing the Republicans into a corner hoping that they will simply give in as they did on the Bush tax cuts. His statement that he might accept 'modest' cuts to Social Security is scarring the crap out of liberals for no good reason. He's offered that before, and for all the rightwing rhetoric the Republicans don't go for it. How could they? Congressional Republicans literally rank below gonorrhea in popularity polling. Also, Obama isn't running next year, and they are. I hope they are stupid enough to agree to Social Security cuts, and Obama signs them. That would end the Republican party forever. 

In the end the Republicans will back down, they are already on the ropes. It's just noise that they are making for their brain dead base. When I say it's just noise, I mean I'm 99.9% certain we'll get a 'good' outcome. You should probably be ready for civilization to end, just in case. The Mayans could have been off by a few months, compared to the thousand years since the made their calender, they could be dead on.