Monday, November 30, 2009

Dubai Again

Uh Oh. It seems that the government of Dubai declines to bail out Dubai World. It also seems that exposure to Dubai may be significant for European banks (and maybe some US ones too).

The world economy is spiralling down as one bubble after another collapses. Zero Hedge describes the situation as a "controlled collapse."

A new world order is defintely needed but I worry about what is going to happen to use plebs as our economies collapse.


Sunday, November 29, 2009

Great Web Page

Interested in reading formerly classified government documents that have been declassified and released in response to freedom of information requests? Here is a great cite

Try searching for Operation Garden Plot, which describes the military procedures/policies for use of US military forces domestically.

Saturday, November 28, 2009

Chemicals in Water Alter Gender of Fish

"Pollution Brings Worrying Signs for Fish Populations; Worse, Most U.S. Drinking Water Comes from the Same Sources"

"Something strange is happening to the fish in America's rivers, lakes and ponds. Chemical pollution seems to be disrupting their hormones, blurring the line between male and female.

"And as CBS News national correspondent Dean Reynolds reports, those fish swim where millions get their drinking water."

U.S. Still Running Secret Jails

Dubai Implodes

Dubai World essentially defaulted on its debt.

It is believed that the Dubai government will and is able to back Dubai World. Still, this default is raising concerns about the possibilities for sovereign defaults by emerging nations and the contagion such defaults might pose.

Washington's Blog has a good discussion:

Wednesday, November 25, 2009

Lead Found in Toys Sold at Major Retailers

The Public Interest Research Group found the following, as reported in the Washington Post:

"U.S. PIRG sent 15 children's products to an independent laboratory for testing. Four were found to have excessive lead levels, and two contained phthalates. For example, a charm made by Claire's boutiques was 71 percent lead by weight, when the legal limit is .03 percent. A cloth book for toddlers, "Big Rex and Friends," which was purchased at Toys R Us, contained 0.19 percent lead. After being notified by U.S. PIRG, Toys R Us stopped selling the book, but it is still available through other retailers."

Tuesday, November 24, 2009

Goldman's Moral Pathology

I find it interesting to read the arguments made by capitalists against contemporary capitalism. Many "entrepreneurial" capitalists strongly dislike the type of "crony" capitalism they see operating.

Naomi Klein describes this contemporary crony capitalism as authoritarianism capitalism and observes that the distinctions between Chinese capitalism and U.S. capitalism are slowly dissipating.

Galbraith describes this contemporary capitalism as "predatory capitalism." In his account, corporate interests loot the state and subordinate the state to corporate interests.

Each of these accounts describe a system that is authoritarian, exploitative, and corrupt. Goldman Sachs's relationship with the US illustrates these characteristics.

Monday, November 23, 2009


During the Great Depression, financial institutions were reigned in with the establishment of the SEC and the Glass-Steagall Act.

Today, it appears that the most important reforms are not going to occur.

Those most important reforms include the following:

Break Up the Too Big to Fails

Reinstate Glass-Steagall

Implement a transaction tax on securities transactions. This tax would not hurt average investors but would halt the High Frequency Trading Scam that allows the biggest investment banks to make money using technology and proximity to beat the market unfairly.

Reform the SEC's program of relying on self-regulation by the financial industry

These reforms are not excessive and do not undermine "free" markets. Rather, they help ensure that the market is not biased toward particular agents whose moral hazzard endangers the entire system.

Sadly, it appears that these necessary reforms are not going to happen. See Dean Baker's post today, "Vampire Banks Rise Again"

Sunday, November 22, 2009

Economic Power

Two of my favorite economic commentators, Naomi Kline and Joseph Stiglitz, are interviewed on the subject of economic power. I highly recommend viewing this interview.

Saturday, November 21, 2009

Deficit Spending Again

I've posted quite a few links and comments on deficit spending.

The US federal government is sovereign and therefore does not have to sell debt to finance deficits, counter to popular opinion.

Recently Obama said that the US faced a double-dip recession if the country does not reign in deficit spending.

Quite a few economists responded by explaining the error in his logic.

Today at Naked Capitalism Edward Harrison has a post explaining both the deficit hawk's errors and the different policy options available.

Thursday, November 19, 2009

Worst Case Scenario: Economic Collapse

I've read about this story on the blogosphere but zerohedge actually posted the report.

Societe General, the French Bank, has published a report titled "The Worst Case Debt Scenario: Protecting Yourself Against Economic Collapse"

The report does not actually calculate the risk of "economic collapse" but does offer investors strategies for preserving their wealth in the event of a collapse.

I printed it but haven't yet read it. It should prove to be interesting reading.

And Commercial Real Estate is Going to Go Crashing Down

MyBudget 360:
"Deutsche Bank expects 70 percent of CRE loans to not qualify for refinancing. That comes out to about $2 trillion in commercial real estate that will mature from now until 2013.

"The Fed through TALF has tried to take some of this debt out of the system but now their books are over burdened. Also, many of the commercial real estate loans are junior and don’t even qualify for TALF and these are the real problems. Either way, the reality of the situation is many of these commercial loans are now imploding and many banks are failing on Friday’s like flies running into the light. Unlike the residential real estate bubble, most commercial real estate loans are backed by shorter term financing that is based on 5 to 7 year terms. If prices have fallen by 40 to 45 percent, refinancing becomes impossible"

check out the full article

Record Mortgage Delinquencies/Foreclosures

From Calculated Risk:
"The MBA reports a record 14.4 percent of mortgage loans were either one payment delinquent or in the foreclosure process in Q3 2009. This is an increase from 13.2% in Q2 2009."

It is hard to see how the recession has ended when residential delinquencies and foreclosures continue to grow and when commercial real estate has just begun its (likely to be) catastrophic collapse...

Wednesday, November 18, 2009

China's Suicide--Will it Be Ours Also?

Today's Market Ticker links to a site with some graphic and sobering images of pollution in China. China is suicidal. However, the U.S. is assisting this suicide. US corporations have closed down or re-located into regions of the world with few environmental restrictions.

The downsizing of US based industry hampers our nation's "recovery" and produced the conditions of possibility for China's suicidal pollution (and other nations' as well) as we are the major consumers of China's goods.

Planet earth will endure but humanity is poisoning the resources necessary for its survival...

Tuesday, November 17, 2009

Hunger in America

Today's Washington Post has a very sad article about rising hunger in America. In 2008, 14.6% of households experienced low or very low "food security." The government no longer calls it "hunger."

From the article:
"Among Americans of all ages, more than 16 percent -- or 49 million people -- sometimes ran short of nutritious food, compared with about 12 percent the year before. The deterioration in access to food during 2008 among both children and adults far eclipses that of any other single year in the report's history."

I imagine 2009 data will be even worse.

Monday, November 16, 2009

Back From Vacation

See slideshow on US cities with most underwater mortgages

Meredith Whitney sees a double dip recession, beginning next year.

More news coming....

Monday, November 9, 2009

Elizabeth Warren: Elites Rescued

"We Rescued The Top Of The System, Left The Bottom To Fend For Itself" at Huffington Post (VIDEO)

Exerpt from the article, accompanying the video:

"Elizabeth Warren, the chair of the Congressional Oversight Panel charged with monitoring the bank bailout, was on Morning Joe Friday morning to dig in to the newly released unemployment report. The numbers are bleak -- unemployment has surpassed 10 percent for the first time since 1983 -- and Warren is not surprised.

"'Let's face it,' Warren said, 'This is sort of how we went about the rescue -- we rescued at the top and we left the bottom to kind of fend for itself -- and that's showing up in the unemployment numbers.'

Warren went on to explain that the report is really about the guarantees the Government made to protect banks' assets while leaving the public out to dry."

Sunday, November 8, 2009

Full Spectrum Dominance

John Pilger's speech on silence is worth reading.
Here is an excerpt:

"The US Air Force calls this “full spectrum dominance”. More than 800 American bases are ready for war.

"These bases protect a system that allows one per cent of humanity to control 40 per cent of wealth: a system that bails out just one bank with $180 billion – that’s enough to eliminate malnutrition in the world, and provide education for every child, and water and sanitation for all, and to reverse the spread of malaria. On September 11th, 2001, the United Nations reported that on that day 36,615 children had died from poverty. But that was not news."

Modern Day Versions of Depression Apple Selling

Tim Iacono has an article at seeking alpha addressing the emergence of Anglo day laborers at Home Depot and other such locales formerly inhabited exclusively by immigrant day laborers.

What this trend illustrates is that working class populations of all origins have been utterly impoverished by the contemporary depression.

I have seen homeless Anglo men on roads and by grocery stores. These men are clearly not substance abusers, but rather are individuals whose marginal attachment to the labor force has been severed. Never before have I witnessed this spectacle of dispossession.

I have also seen Hispanic men and families parked on the side of trafficked roads selling tiny potted plants and small numbers of pepper wreaths. Their desperation reminds me of the shoe-lace sellers during the Great Depression. Xenophobic attitudes toward Hispanic immigrant populations are no doubt exacerbating their desperation.

I wonder how many people are depending on food banks for their survival?

Why have we allowed this situation to arise? America still contains vast wealth. The federal government has bailed out financial institutions using trillions of dollars. And yet we allow living standards to deteriorate so much that vulnerable populations have become utterly impoverished and desperate.

The recent mediated spectacles of violence enacted by adolescents (rape, murder, torture) and by military members demonstrate the strain and degradation of humanity that is occurring as our broken (financial and military) empire wages war directly against foreign populations and indirectly against vulnerable domestic populations.

The anger and desperation produced by the assaults of empire are easily subject to manipulation so that rage is directed inward rather than outwards at the true sources of imperial exploitation.

The time has come to demand an end to the financial looting of this nation by elite interests and to demand the end of a failed project of empire that is looting America's wealth and destroying the lives of its citizens and the lives of citizens abroad.

Friday, November 6, 2009

"The Obama Administration is Captured"

Credit Writedowns argues that the administration is captured by financial interests when it comes to the economic governance of the nation. I agree.

Money, Credit and Debt

There are 2 interesting videos to watch that explain the creation of modern modeny and the current debt-based credit crisis.

The first video is Max Keiser's interview with Ellen Brown. Ellen Brown explains how modern money is created. It is created by banks and financial institutions rather than by government. Governments do create money but they are not the major player in that game.

The second video, of the economist Steve Keen, is long but worth watching if you want an in-depth understanding of the current crisis.

From my point of view, what is most significant about Keen's video is his argument that the government ought to have bailed out consumers, rather than the banks. Keen is not sentimental. Rather, his argument is that a bailout of, or debt forgiveness for, consumers is the only effective way forward and out of the current crisis.

The Real Reason

Today's WSJ p. B1

"Baghdad--the Iraqi Oil Ministry has awarded an Exxon-Mobil Corp. consortium the right to develop one of the world's largest oil fields, marking the first time an American-led group has been allowed into the Iraqi oil patch since the U.S.-led invasion began."

Wednesday, November 4, 2009

Former UK ambassador: CIA sent people to be ‘raped with broken bottles’

"The CIA relied on intelligence based on torture in prisons in Uzbekistan, a place where widespread torture practices include raping suspects with broken bottles and boiling them alive, says a former British ambassador to the central Asian country..."


Tuesday, November 3, 2009

Military Industrial Complex and Propaganda

This link is for a video interview with Larry Wilkerson on the Military-Industrial Complex. He is a former military officer and has served in government as well.

His comments echo a conversation I had recently with my class about the use of propaganda to legitimize wars in Iraq and Afghanistan.

Wilkerson argues that energy policy needs to be publicly debated, not cloaked in propaganda used to manipulate the public to support what are fundamentally energy wars.

Wilkerson's interview also echoes Eisenhower's warnings about an entrenched and self-serving military industrial complex.

More Data on Rising Foreclosures, Bankruptcies and Food Stamp Dependence: Long Live the Recovery!


Monday, November 2, 2009

AIG Again

Today, Zero Hedge has an article with the following headline:
"Darrell Issa's Letter To The NY Fed's Bill Dudley Demanding AIG Bailout Disclosure"

Darrell Issa is the ranking member of the Committee on Oversight and Governmental Reform. His letter to AIG demands disclosure of financial information from AIG on additional and backdoor public funding AIG may have received from the Federal Reserve Bank of New York. Here is what Issa says:

"Thus, behind closed doors and with no approval from Congress, the FRBNY [Federal Reserve Bank of N.Y.] may have added an additional $13 billion of debt on the backs of taxpayers. These allegations, if true, amount to NOTHING LESS THAN A BACKDOOR BAILOUT OF AIG'S CREDITORS, including Goldman Sachs, Merrill Lynch, Societe Generale, and Deutsche Bank."

When will the ransacking of the U.S. public end? Why is it allowed to continue? I cannot believe this is happening.