Saturday, July 30, 2011
The Fiddlers, our Lords and Masters, whose collective 30 years on recklessness, deception, fraud, manipulation and misrepresentation should put 75% of them in prison doing hard-time, continue to waste our time, resources and futures. Most, not all are motivated by their shallow political careers. A rational response by the American Public, their subjects, if they truly understood the consequences of where we are, would be very ugly.
I predict that the games will be played till a moment where Obama will sieze control of the process and increase the debt ceiling unilaterally. Some of the geldings in Congress and the party hacks will howl but the unhappy result will be that Obama will look to be a strong man of action who saved the nation from financial disaster. The Constitution will be just short of meaningless and the games will continue. We would have a better shot at winning at Three Card Monte.
Thursday, July 28, 2011
"Obama is dividing us as a nation," Langone said. "He's not bringing us together. He's willfully dividing us. He's petulant."
Published: Thursday, 28 Jul 2011 | 8:55 AM
By: Jeff Cox
CNBC.com Staff Writer
President Barack Obama's conduct during the debate over the debt ceiling has divided the country and will inflict damage that will last well after the battle is over, former New York Stock Exchange director and Wall Street stalwart Ken Langone said.
While he believes a debt deal will get done and in fact favors a plan closer to what the Democrats are proposing, Langone told CNBC that Obama's behavior has been "unpresidential."
"He is dividing us as a nation," Langone said. "He's not bringing us together. He's willfully dividing us. He's petulant."
The co-founder of Home Depot [HD 35.88 0.255 (+0.72%) ]sharply criticized the president for promoting class warfare through his repeated attacks against "fat cat" business executives and his targeting of tax loopholes.
In sum, the behavior is symptomatic of Obama's disrespect for the office he holds, Langone said.
"Ronald Reagan would never go into the Oval Office without his jacket on—that's how much he revered the presidency," he said. "This guy worked like hell to be president...Behave like a president. Let me look at you as a model to how we should behave. What does he say? Fat cats, jet airplanes. What is the purpose? Us versus them.
"The thing I fear the most about the future of America is...divide us, we all lose. This has got to stop."
Langone said people with his wealth should pay more taxes, but the debate shouldn't be framed as rich against poor.
"He is not acting presidential. He is behaving in a way designed in my opinion to divide us, to make us look at each other with skepticism, with suspicion. That is the end of America as we know it," he said. "The destruction he is inflicting by his behavior will carry on long after we settle the debt limit."
Nevertheless, Langone said he expects a debt deal to happen as the warring factions will keep battling until the final hour. He suggested that Congress follow the adage of "keep it simple, stupid" when addressing the problem and conveying the solution to the American public.
"The debt ceiling will be raised, number one, by next week," he said. "They'll come to some juncture where they're going to say, 'This is not what I wanted but it's the best I can get.'"
One solution he proposed is higher taxation, particularly for the wealthier in society who are getting benefits they don't deserve from entitlement programs such as Social Security.
Cuts to those programs have been an especially sensitive part in the debate as deficit reducers on the right insist some reform will be needed in entitlements while opponents on the left insist on higher taxes for higher earners.
Langone agrees with the higher taxation argument as long as those revenues are used toward debt reduction.
"People like me have to understand that it isn't business as usual," he said. "I think it's a travesty for a man of my success and my means to get anything from the federal government. I think I should pay more taxes."
Wednesday, July 27, 2011
Tuesday, July 26, 2011
"The consequences of arming Mexican drug cartels seem obvious. But even guns turning up at crime scenes in Mexico wasn't enough for Justice Department officials to arrest straw purchasers and shut down their trafficking operations. Tragically, it wasn't until Fast and Furious guns were found at the murder scene of a Border Patrol Agent that Justice officials finally ended this reckless and arrogant effort," said Issa.
"It's incomprehensible that officials at the Justice Department, the ATF and the U.S. attorney's office would keep their counterparts at the U.S. embassy in Mexico City in the dark about Operation Fast and Furious. Keeping key details secret while straw purchasers continued buying weapons for gun traffickers jeopardized our relationship with our southern ally and put lives at risk," Grassley said.
ATF leadership finally informed the Mexican office that the investigation would be shut down as early as July 2010. Operation Fast and Furious, however, continued through the rest of 2010. It ended only after U.S. Border Patrol Agent Brian Terry was murdered in December 2010 with weapons linked to this investigation. Only then did the ATF officials in Mexico discover the true nature of Operation Fast and Furious. Unfortunately, Mexico and the United States will have to live with the consequences of this program for years to come.
Mr Issa's Committee Report
“That is, I mean, this is the perfect storm of idiocy.”
Monday, July 25, 2011
Universal suffrage is the death-knell of any society. It has totally failed every time that it has been tried.
America can now only defer its debt crisis
Whatever action its politicians do or don’t take this week, the US is already bust, writes Jeff Randall.
The heat is on in Washington and it’s more than just temperatures in the nineties and summer rain making congressmen sweat. Without a deal to raise the country’s $14.3 trillion debt ceiling, the US will default on August 2.
It has come to this: the world’s biggest economy, head of the triple-A club and home of the financial system’s reserve currency, can pay its bills only if it borrows more money. America needs to increase its credit limit by $2.5 trillion simply to get through to next year’s presidential election.
Billions, trillions, schmillions, chill out, why fret over a few more zeros? Well, for context, America’s 2011 GDP (annual output) will be the same as its “official” debt, $14 trillion to $15 trillion.
This doesn’t tell the whole story. The good news is that $4.6 trillion of America’s debt is accounted for by intra-government loans, money the US owes itself. The bad news is that on top of the $9.7 trillion Washington must repay to outside investors ($1.1 trillion to China), it has $60 trillion of unfunded social security and Medicare obligations, ie, welfare pledges to its own citizens for which there is no pot of savings, only the taxes of future generations.
As Dolly Parton nearly said, it cost a lot of money to sink this deep. America’s commercial and military hegemony came at a terrifyingly high price.
In 1835, US federal debt was zero; the country owed nothing. Two centuries later, having become the richest and most powerful nation on earth, America is, quite literally, running out of cash. The problem was explained by Addison Wiggin and Bill Bonner in their best-seller Empire of Debt: not many people can afford to live like Americans; the trouble is, neither can they.
Last year, the difference between what the US paid for imports and received from exports was almost $500 billion. This year, the trade gap with China alone is running at $25 billion a month. As a result of ambitious welfare programmes and military adventures, the Obama administration is running a budget deficit of $1.3 trillion.
According to Warren Buffett, America’s most successful investor, the country has “relied on the labour of others to provide things that can be used every day… this can continue for a long time and on a large scale – but not forever”.
There speaks the voice of common sense. On the other side of the hospital screens, we have media dons, Princeton’s Paul Krugman and British-born David Blanchflower, professor of economics at Dartmouth College, championing fiscal incontinence as the route to salvation.
Aside from their links with Ivy League universities, Krugman and Blanchflower have something else in common: they both admire Gordon Brown, who clocked up £160bn of budget deficits in the boom years of 2003-07. At the core of their thinking, and his, is an unshakeable belief that government spending sparks growth, which is the sine qua non of life, liberty and happiness – and also debt reduction.
But hang on a minute, how come Greece required two multi-billion-euro rescue packages? Did the Greeks economise themselves into penury? Were they guilty of criminal parsimony? Or was it that, thanks to its fraudulent entry into the euro, Athens was able to borrow recklessly, allowing vote-crazed leaders to bribe the electorate with money the country did not have and could never afford? Ah, say the professional spendthrifts, the US is not like Greece. True, it is vastly bigger and so are its debts – and they’re not going away.
A study by Harvard professor Kenneth Rogoff and Carmen Reinhart from the Peterson Institute shows that when public debt tops 90 per cent of GDP it acts as a brake on growth. Their study of 44 countries, going back 200 years, concludes that it would be foolish to interpret today’s low borrowing costs as a green light for further debt. “Politicians everywhere like to argue that their country will expand its way out of debt, [but] our research suggests growth alone is rarely enough to achieve that with the debt levels we have today.”
Boston University’s Professor Laurence Kotlikoff goes further: America is already bankrupt. Writing for Bloomberg, he explained that US debt is much greater than has been declared: “Congress has been very careful… to label most of its liabilities as 'unoffical’ to keep them off the books and far into the future… This is what happens when you run a massive Ponzi scheme for six decades straight, taking ever larger resources from the young and giving them to the old while promising the young their eventual turn at passing the generational buck.”
Ponzi schemes survive as long as they are able to attract increasingly bigger contributions from ever more participants. Eventually they collapse under the burden of impossibility. This is where America is heading. It is beyond the point at which it can cut benefits or raise taxes sharply enough to prevent exponential debt growth.
If Democrats and Republicans can cobble together a compromise this week – and the markets still give them the benefit of the doubt – their fix will be nothing more than crisis deferral. Capitol Hill is in the business of Micawberism. What price the Fed resorts again to printing money?
Sunday, July 24, 2011
Saturday, July 23, 2011
House Speaker John Boehner has walked away from negotiations with President Obama over a deal to raise the debt limit.
"In the end, we couldn't connect. Not because of different personalities, but because of different visions for our country," Boehner said in a letter to colleagues. He said Mr. Obama " is emphatic that taxes have to be raised" and "adamant that we cannot make fundamental changes to our entitlement programs."
"For these reasons, I have decided to end discussions with the White House and begin conversations with the leaders of the Senate in an effort to find a path forward," he said.
House Republican leadership aides told CBS News that Boehner will work with the Senate leadership in an attempt to reach a deal that meets the GOP's two central requirements: That spending cuts are equal to or greater than debt limit increase and that there are no new taxes.
Nguyen Cao Ky, Ex-General Who Ruled South Vietnam, Dies at 80
By THE ASSOCIATED PRESS
Published: July 22, 2011
KUALA LUMPUR, Malaysia (AP) — Nguyen Cao Ky, the former air force general who ruled South Vietnam with an iron fist for two years during the Vietnam War, died Saturday. He was 80.
Mr. Ky died at a hospital in Kuala Lumpur, where he was being treated for a respiratory complication, his nephew in Southern California told The Associated Press.
“He was in good health, but in the last couple of weeks he had been weak,” the nephew, Peter Phan, said. He said Mr. Ky split his time between his home in California and Vietnam.
One of his nation’s most colorful leaders, Mr. Ky served as prime minister of South Vietnam, which was backed by the United States, in the mid-1960s. He had been commander of South Vietnam’s air force when he assumed the post in 1965, the same year American involvement in the war escalated.
He was known as a playboy partial to purple scarves, upscale nightclubs and beautiful women. In power during some of the war’s most tumultuous times, he was a low-key but sometimes ruthless leader.
“It’s true that I did have absolute power when I was made premier,” he said in a 1989 interview with The Associated Press. “You may recall there was no congressional body in South Vietnam at that time. For more than two years, my word was the absolute law.”
From 1967 to 1971, he was vice president under his frequent rival, Gen. Nguyen Van Thieu.
When General Thieu’s government in Saigon fell to North Vietnamese troops in 1975, Mr. Ky fled by piloting a helicopter to a United States Navy ship. He and his family eventually settled in the United States, where he led a quiet life largely away from politics. He made headlines in 2004 when he made a controversial visit back to his homeland, praising the Communists, his former enemies.
Born in Son Tay Province west of Hanoi in 1930, Mr. Ky grew up under French colonialist rule and became involved as a youth in the national liberation movement led by Ho Chi Minh.
He left the movement, however, when he fell ill with malaria. He eventually enlisted in the army, where he trained as a pilot and rose through the ranks during the French fight against the insurgency. He was among the one million who fled the south after France’s defeat at Dien Bien Phu in 1954. The French withdrawal divided the country into the Communist North and non-Communist South.
Mr. Ky rose steadily in South Vietnam’s fledgling air force and was chosen as prime minister by a junta even though he had no political experience.
He was able to end a disruptive cycle of coups and countercoups that had followed the assassination of Ngo Dinh Diem, whose repressive regime was overthrown by military generals in 1963.
But Mr. Ky proved overly optimistic about the American prospects for victory.
In an interview with The New York Times in 1966, Mr. Ky said American airstrikes would “very soon” force the North to request a cease-fire, and said of war critics in the Unites States Senate: “They know nothing about Vietnam. ... They just represent the minority.”
Saying he wanted to end corruption, Mr. Ky threatened to shoot merchants manipulating the country’s rice market. A businessman convicted of war profiteering was executed by a firing squad in March 1966; Mr. Ky attended the trial’s opening session.
But when it came time for the country’s presidential election in 1967, Mr. Ky yielded power to his longtime rival, General Thieu, who at the time held the ceremonial post of chief of state. Mr. Ky served as General Thieu’s vice president until 1971, when he was briefly a rival candidate to General Thieu’s re-election.
He went on to watch General Thieu preside over the fall of Saigon. General Thieu was forced to step down as North Vietnamese troops closed in. He eventually left the country and died in Boston in 2001 at age 78.
The journalist and author Neil Sheehan, who won a Pulitzer Prize for his book on Vietnam, “A Bright Shining Lie,” told The A.P. in 1989 that Mr. Ky and General Thieu were “corrupt Young Turks” who rose to power as American involvement dramatically increased.
Mr. Ky flatly denied the characterization, saying, “If I had stolen millions of dollars I could live like a king in this country, but obviously I don’t live like a king. Believe me, I was a soldier fighting for freedom, not a politician interested in power and money.”
Mr. Ky made headlines in 2004 when, after 29 years in exile, he made a homecoming trip to Vietnam, dropping his vitriolic anti-Communist rhetoric and calling for peace and reconciliation.
Mr. Ky, who was married three times, is survived by six children and, according to his memoir, 14 grandchildren. He had five children by his first wife, a French woman. He and his second wife, a Vietnamese woman, had a daughter, Nguyen Cao Ky Duyen, a prominent Vietnamese-American entertainer. He met his third wife while living temporarily in Bangkok.
Friday, July 22, 2011
Today, it is going to 103F in New York City
It has been worse:
and worse still:
Thursday, July 21, 2011
China to Dive for Buried Treasures
Submersible Is Set to Hunt for Valuable Minerals in Pacific
By JEREMY PAGE
Tuesday, July 19, 2011
Monday, July 18, 2011
Record-high Irish borrowing rates are at 14%.
Unemployment in Portugal is 12.4% (youth: 28.1). The figures for Spain are 20.9% (44.4), Greece 15%(38.5), Ireland 14% (26.5), Latvia 16.2% (32.9). You cannot stimulate growth in an economy with rising real interest rates. This is meltdown, EU-style. Are there any good reasons for a country not to have its own currency?
The Euro is still north of USD 1.40.
Saturday, July 16, 2011
Sen. Everett Dirksen on increasing the federal debt (1965)
HAT TIP: Unconfirmed Sources
Complicated graphs and charts prove the country is now just fine.
President Obama and Congress breathed a collective sigh of relief today as Obama signed into law a budget agreement that would raise the federal debt ceiling from it's current $12 trillion to $120 trillion.
"The country's finances are now in excellent shape", an upbeat Obama said in a prepared statement. "We now have plenty of money for education, health care, social security, NPR and funding for the wars".
House Republicans were initially against raising the debt ceiling until Mitch McConnell, the Senate Republican leader, reminded congress that without the removal of the debt ceiling congress would have to be shut down and they would be unable to vote themselves pay raises.
The President said he has a plan to have the country fiscally sound by the time the $120 trillion debt limit has been reached, which will probably be in about 10 years.
"We will start slowly paying our bills", Obama stated. "We will find ways to reduce the deficit as time goes on but let's enjoy the economic prosperity we have now found!"
Some people interviewed were skeptical of the new plan. "If I go a hundred bucks in debt I have creditors crawling up my ass!" said Ventura California bartender Melvin Grace. "Why can't I go at least a few thousand into debt and be OK?"
"You do as we say, not as we do", Obama reminded Grace.
Thursday, July 14, 2011
China’s rapidly expanding satellite programme could alter power dynamics in Asia and reduce the US military’s scope for operations in the region, according to new research.
Chinese reconnaissance satellites can now monitor targets for up to six hours a day, the World Security Institute, a Washington think-tank, has concluded in a new report. The People’s Liberation Army, which could only manage three hours of daily coverage just 18 months ago, is now nearly on a par with the US military in its ability to monitor fixed targets, according to the findings.
“Starting from almost no live surveillance capability 10 years ago, today the PLA has likely equalled the US’s ability to observe targets from space for some real-time operations,” two of the institute’s China researchers, Eric Hagt and Matthew Durnin, write in the Journal of Strategic Studies.
China’s rapidly growing military might has unnerved its neighbours, many of whom are US allies, while a series of disputes this year with Vietnam and the Philippines have added to the concerns.
China’s military build-up has accelerated in recent years, as it has developed an anti-ship ballistic missile, tested a stealth fighter and is poised to launch its first aircraft carrier. The fast-growing network of reconnaissance satellites provides China with the vision to harness this hardware.
Admiral Mike Mullen, America’s top military official, said at the weekend in Beijing that it was clear that the PLA is focused on “access denial” – a term that describes a strategy of pushing the US out of the western Pacific.
“The US is not going away,” Adm Mullen, chairman of the joint chiefs of staff, said. “Our enduring presence in this region has been important to our allies for decades and will continue to be so.”
China warned the US last month not to become involved in its dispute with Vietnam over the South China Sea. “[China’s] strategic priority is to keep the US out of its backyard,” Mr Durnin told the Financial Times, adding that the satellite technology needed for achieving that goal is now in place.
When China tested missiles near Taiwan in 1996, the US deployed two aircraft carriers to nearby waters. The PLA’s inability to locate the ships was a source of great embarrassment that helped spur China’s satellite programme.
“The United States has always felt that if there was a crisis in Taiwan, we could get our naval forces there before China could act and before they would know we were there. This basically takes that off the table,” said Joan Johnson-Freese, a professor at the US Naval War College in Rhode Island.
China cut-off military relations with the US early last year, after Washington announced an arms sale to Taiwan. The two militaries have been working to repair ties this year, with PLA Chief of the General Staff Chen Bingde visiting Washington in May and Adm Mullen in China until July 13.
Wednesday, July 13, 2011
Most of that from projects that were completed back in the 80's, and have long since been paid for.
Basically, the cheapest electricity in the world.
Wed Jul 13, 11:39:00 AM EDT
Tuesday, July 12, 2011
European shares have fallen further on concerns that the debt crisis in the eurozone may spread to Italy and Spain.
Italy's main index was down 4%, while Spain's was 2% lower. German's Dax had lost 2.3% and the UK's FTSE 100 had shed 1.6%.
The yields on Italian and Spanish bonds also continued to rise as worries over the two countries grew.
On Monday, eurozone finance ministers said they were ready to pass new measures to stop the crisis spreading.
The euro was also lower, falling in early Tuesday trading to a four-month low against the dollar at $1.3958.
The concern is that Italy and Spain may have to follow Greece, Portugal and the Republic of Ireland and seek a European Union and International Monetary Fund (IMF) bail-out.
Eurozone finance ministers said increased efforts to "improve the euro area's systemic capacity to resist contagion risk" would include "enhancing the flexibility and the scope" of the European Financial Stability Facility (EFSF).
This is the bail-out fund to which eurozone member states contribute.
Finance ministers also agreed to look at lowering the interest rates that Greece, Portugal and the Irish Republic have to pay, plus lengthening the maturities of their loans.
Eurozone finance ministers are now due to meet later in Brussels with their colleagues from European Union nations that do not use the euro.
Concern that Italy could be the next country to require a financial bail-out comes as Italy's Finance Minister, Giulio Tremonti, announced that he would leave Tuesday's talks early so he could continue to work on an austerity budget to reduce Italy's public deficit.
He has proposed 48bn euros ($67bn; £42bn) in budget cuts over three years and aims to cut the deficit to zero by 2014 from this year's 3.9% of gross domestic product.
However, financial markets were unsettled by remarks from Prime Minister Silvio Berlusconi, who indicated in a newspaper interview that the austerity plan might not have full cabinet support.
Shares in Italian banks continued to fall, with Intesa SanPaolo down 6.6% and UniCredit 7.1% lower.
Spanish banks also declined further, as did lenders in other countries.
Santander's stock was down 5.4%, Germany's Deutsche Bank was 5.6% lower, and in the UK Lloyds Banking Group dropped 4.7%.
In a sign that investors are growing more risk averse, the yield on Italian 10-year bonds on Tuesday increased to 5.9% from 5.6% on Monday.
Meanwhile, yields on 10-year bonds issued by the Spanish government rose to 6.3%, from 6.1%.
Analysts say both these yields are now close to levels at which the two countries will have problems servicing their debts.
Asian shares had earlier closed lower, with the situation in the eurozone being closely monitored around the world.
Japan's Nikkei index lost 1.4%, while Hong Kong's Hang Seng declined 1.4%. US shares also declined overnight, with the Dow Jones down 1.2%.
Jean-Francois Robin of French investment bank Natixis said: "We find ourselves at one of the worst moments of the European monetary crisis.
"The idea of a contagion from the Greek crisis to other eurozone countries like Italy and Spain is gaining ground."
Eurozone finance ministers also discussed on Monday how, and by how much, banks and other financial institutions could contribute to a new rescue package for Greece.
However, no final decision was reached on this, as it also has to be agreed with the IMF.
Speaking from Washington, IMF managing director Christine Lagarde said it was not yet ready to discuss terms for a second Greek bail-out.
"Nothing should be taken for granted," she said.
Meanwhile, Greece's Prime Minister, George Papandreou, called for a comprehensive solution to his country's debt problems.
"I thus believe it is time now to address our fundamental problems head on and produce a comprehensive package of solutions that clearly signals our determination not to see the European project further damaged or destroyed," Mr Papandreou said in a letter to Jean-Claude Juncker, chairman of the eurogroup of finance ministers.
Sunday, July 10, 2011
US lawmakers vote to kill Hubble successor
(AFP) – 2 days ago
WASHINGTON — In a fresh blow to NASA's post-shuttle aspirations, key US lawmakers voted Thursday to kill off funding for the successor to the vastly successful space-gazing Hubble telescope.
The US House of Representatives Appropriations Subcommittee on Commerce, Justice, and Science approved by voice vote a yearly spending bill that includes no money for the James Webb Space Telescope (JWST).
The move -- spurred on by belt-tightening in cash-strapped Washington -- still requires the full committee's approval, the full House's approval, the Senate's approval, and ultimately President Barack Obama's signature.
But the relatively mild dissents in the committee, which said in a terse statement this week that the project "is billions of dollars over budget and plagued by poor management," suggests the JWST faces an uphill fight to survive.
The vote struck a blow at the National Aeronautics and Space Administration's goals with the space shuttle program about to end after 30 years, and Obama's decision to axe a new plan to return astronauts to the moon.
NASA plans to lay out a budget that "will allow us to launch the Webb telescope in this decade," deputy administrator Lori Garver told reporters at the Kennedy Space Center in Florida.
"We will be working with Congress to assure them we can manage this program and develop the most amazing space telescope," she said, calling the JWST "a perfect example of reviewing the unknown and reaching for new heights."
In February, NASA Inspector General Paul Martin told lawmakers the JWST had careened billions of dollars over budget.
Initial estimates put the cost of the telescope, designed to help the hunt for knowledge about early galaxies in the universe, at $1.6 billion, but now the total price tag has ballooned to $6.5 billion, he said.
AMAZING HUBBLE PHOTOGRAPHS