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Monday, May 07, 2012

Turmoil in Europe: Belgistan, France, Greece and Russia






89 comments:

  1. (Reuters) - European shares fell to 4-1/2 month lows on Monday after election results in Greece and France that reflected public anger over austerity measures and cast doubt on the euro zone's ability to resolve its debt crisis.

    Investors and technical strategists said key European indices could fall further over the week, as uncertainty over the already ailing European economy grows.

    In France, Socialist Francois Hollande won the presidency from right-wing incumbent Nicolas Sarkozy, but investors expressed more concern over Greece.

    The only two major Greek parties to have supported an EU/IMF aid program to keep the country afloat failed to win enough votes to form a ruling coalition.

    "France is not the problem - the bigger problem is Greece," said Francois Savary, chief investment officer at Swiss private banking firm Reyl, which manages more than 5 billion Swiss francs ($5.5 billion) of assets.

    The Euro STOXX 50 index .STOXX50E of top euro zone blue chips was down 0.5 percent at 2,236.95 points by 1000 GMT, having fallen as much as 1.9 percent to 2,204.73 - its lowest level since late December 2011.

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  2. U.S. growth in the first quarter fell to 2.2 percent, a disappointment. But in Europe, that news would have caused general rejoicing. For consider the gathering crisis on the old continent.

    With negative growth now for six months, Britain has fallen back into recession. “I don’t think we’re anywhere near halfway through the eurozone crisis,” said Prime Minister David Cameron this weekend.

    Romania’s government fell last week. The Czech government barely survived a vote of no confidence. In the capital cities of both countries, tens of thousands have angrily protested the new austerity.

    The Dutch government also fell last week, when the Freedom Party of right-wing populist Geert Wilders abandoned the governing coalition.

    Wilders refuses to support spending cuts and new taxes needed to meet the hard deficit target of 3 percent of gross domestic product set by the European Union for 2013.

    The Rome government of Silvio Berlusconi is history. New Prime Minister Mario Monti says Italy cannot sustain the austerity being imposed upon her.

    In Spain, unemployment has hit 24.4 percent. Half her young are jobless. “Spain is undergoing a crisis of enormous proportions,” says Foreign Minister Jose Manuel Garcia-Margallo. He compares the EU to the Titanic.

    French elections are Sunday. Most observers believe they will end the career of President Nicolas Sarkozy and install in the Elysee Palace a socialist, Francois Hollande, who has pledged to impose a 75 percent tax on incomes above 1 million euros.

    With a week to go, the French campaign calls to mind the 1930s.

    Sarkozy, says The New York Times, is focusing on “patriotism, protectionism, French values,” attacking immigrants who do not assimilate.

    ”I do not want to let France be diluted by globalization,“ Sarkozy declared Sunday. ”Europe has given in too much to free trade and deregulation. … I do not want France to be isolated in the world, but I want frontiers respected. … France expects a Europe that protects the European people.“

    The far-left candidate, Jean-Luc Melanchon, defeated in the first round, is charging Sarkozy with using the language of Pierre Laval and Marshal Philippe Petain, both convicted of collaborating with the Nazis.
    {…}

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  3. {…}(Page 2 of 2)

    ”To be treated as a fascist by a communist is a compliment,” says Sarkozy.

    ”In 2012, the issue is borders, and I will put them at the center of the debate,“ Sarkozy said Sunday in Toulouse, where an Islamist fanatic recently murdered four Jews, including three children, and three French soldiers.

    ”Without borders, there is no nation, there is no Republic, there is no civilization,” he told 10,000 cheering supporters. “We are not superior to others, but we are different.”

    Sarkozy is on “a mad path,” says Hollande. “The issue in France and in Europe is the fight against extremism.”

    Greek elections are also scheduled for Sunday, with the center-left Pasok Party and center-right New Democracy having lost half of their support since 2009.

    Ireland votes May 31 on the eurozone fiscal pact that calls for austerity among Europe’s most indebted nations. Polls are predicting a yes vote. But Sinn Fein’s Gerry Adams has ridden a rising tide against the pact to make his party the second-most-popular in Ireland.

    ”The rise in political extremism in Europe,“ writes Financial Times columnist Wolfgang Munchau, ”is in part the consequence of stubbornness and stupidity among centrist elites.“

    Where is Europe going?

    Larry Summers is probably right, ”Again Europe and the global economy approach the brink.“

    With the demonstrations, riots, and governments falling like dominoes, Europe’s ruling elites are losing the confidence of the people and its ruling parties are bleeding support to the more militant left and right.

    What does this portend for Europe?

    Probably an easing up of austerity – of the tax hikes and budget cuts for payrolls, pensions and health care – demanded by Germany’s Angela Merkel and her fiscally hawkish allies. And it probably means an effort to stimulate the dormant economies of Europe without sending buyers of Europe’s bonds fleeing for the exits out of fear of inflation or default.

    But the vision of One Europe that dates back to the 1950s and Jean Monnet seems to belong to yesterday.

    Transnationalism, the idea of sacrificing the national interest for the greater good of Europe, is dying. Not one of the four leading French parties in the first round of voting was making the case for Europe.

    Second, the idea of a multicultural Europe open to immigration from beyond its borders seems to be dead.

    Third, the ideology of Occupy Wall Street has crossed the pond.

    The senior Catholic cardinal in Britain is demanding that Cameron accept a ”Robin Hood tax“ on large financial transactions to make ”banks and large financial institutions pay their fair share,“ with the tax money going to the poor.

    The One Percenters are in the gun sights everywhere. Rarely was Yeats’ couplet more apposite.

    Things fall apart; the centre cannot hold;

    Mere anarchy is loosed upon the world.


    PAT BUCHANAN

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  4. All this and you are still painting BN as the boogeyman??? If iran gets nukes nothing is going to stop sharia from taking over europe. no one will have the guts
    to stop it. but Bibi N. is the one who is dragging us into war. Deuce you are a charlatan and go ahead and delete away to prove my point.

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    1. By the way genius, a Charlatan is a fraud as in someone that talks about someone with “guts” and then hides behind “Anonymous” in order to cast an insult.

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    2. thank you but i am not a genius nor am i alan. can you please tell me what is in a name?
      what is so brave about making up a fictitious name? now if you think going by your real name and SS number is brave, have at it and see how that works for you.

      My opinion is that these statements you make are fraudulent as you post videos of real
      Dangers of sharia taking over Europe (of course this could never drag us into a war) but
      B.Net is the real war menace in your own colorful words.

      Delete
  5. I will continue to delete your comments when you are emotionally out of control and make personal attacks instead of acting like an adult. The new policy is I am no longer going to bother inspecting your comments one by one. If I find one comment on a thread that does not comply with the policy, I will delete all of them. That will prove my point.

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  10. This zeroing in on BN really reminds me of an experience I had after getting out of the service. Working for the navy as a contractor, the civil servant heading the department was obsessed with blaming that “shitty” country for things. So when the Murrah federal building was blown up in Oklahoma he made it a point to walk into everyone’s office to libel that “shitty” country as being behind it so we would hate muslims and fight a war on their behalf. This reminds me so much of you. So, when it turned out it was Mcveigh, a white irish/germanic American he acted like he never said anything. The lesson here is that being white and serving in the military does not mean you are a good American.

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    1. Alan Wake up, the previous post was about a special prison for veterans. No one on this blog has ever claimed being white and a veteran make one a good American. As to the zeroing in on Bibi, what other head of state is trying to drag the US into another ME war?

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  11. The dickhead doesn't write on this fine blog.

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  13. Bibi isn't your dad.

    'sides, my Dad wasn't a dickhead.

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    3. .

      I have the license on the word 'dickhead'.

      If you want to use it, it will cost you.

      .

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    4. send the bill to logos, he used it 1st...

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  14. And, This post is about Europe, and how it is becoming unraveled. This is something of which we need to be very interested. In some ways, on our present course, our problems are going to be very similar to Europe's present problems. In other ways we are quite dissimilar.

    So, we need to get a good handle on exactly what is the "major malfunction" over there. Is it an issue that we're going to be facing in the, perhaps near, future?

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  15. I'm looking at Greece is to Germany as Mississippi is to New York. The taxpayers of NY routinely transfer Millions to the "U.S. Citizens that reside in Ms" every year. Without that "aid" the standard of living of the citizens of the State of Mississippi would be forced to live much different lives.

    If the state of Ms. was forced to provide similar benefits to its citizens as NY, but to do it on its own dime it couldn't do it. It could borrow the money for awhile, but, eventually, it would have to declare bankruptcy, Or Be Bailed Out.

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    1. That should tell you something about the wisdom of living off the dole and the proper place for rent seekers and their progressive patrons in a rational society. But it won't. Because you are yourself a committee of nameless progressives plucking and pinching and waving a sock puppet.

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  16. The Transfer of Wealth from the citizens of NY to the citizens of Ms is accepted by the former because "we're One Country."

    It isn't accepted by the citizens of Germany, because Greece and Germany are Two Separate, and Distinct Countries."

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  17. Just this. In all the phoney ardour and heat, no one is paying any attention to the two facts that make nonsense of this supposed debate – which is not a debate. The first is that the assumption which all the principal parties have chosen to share is wrong. Relying on the free market to support a vast system of entitlements (whichever of the two you choose to make your first priority) is not sustainable. The market economy simply cannot afford the enormous cost of the social security programmes that are now regarded as politically untouchable in Europe and in the US – as both of their political elites are painfully discovering.

    The second, and even more critical point, is that the economy has become so globalised that it is beyond the control of any national government, and therefore outside the reach of democratic accountability.

    LINK

    Two points.

    1. The USA is not EUrope.

    2. The global economy is controlled by Wall St and the central banks. The politicians lost control in 2008. "Democratic accountability" is an artifactual and quaint notion.

    But I enjoy watching the EU intellectuals join the fun, especially the part where they (predictably) add: "EUrope ... AND USA" must/will/face/failed [fill in the blank.]

    BTW her entire thesis in incorrect ... at least here in USA. EUrope is another geography/culture/matter.

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  18. The only country in Europe that is "worth dick" in trade is Germany. They are powerful beneficiaries of the Euro (that is much lower-valued than the D'Mark, itself, would be.) The rest of Europe is powerfully constrained by the insular, and protectionist Euro Trade Policies.

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  19. The U.S. also benefits from a continued strong tension between the "Union," and "Non-Union" States. They, to a large extent, keep each other in line.

    Europe, on the other hand, has swung way too far into the "Unionist" Camp. It's almost impossible to Fire anyone in Europe; as a result, Companies are loathe, even in the best of times, to "Hire" new people.

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  20. No, you're right, Max; we're not Europe.

    The question is: How far can we go down the road to "Socialism/Social Justice" without becoming Europe in its worst.

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  21. And, then, there's "Energy."

    Ah, I can feel the heat from Q's rising blood pressure from here. :)

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  22. I think I'll skip "Energy," today. Even I get tired of it after awhile. :)

    Except to say that the only thing that's up today in the energy space is Nat Gas. Up $0.06. In the "lift-off" stage of a Moonshot, I believe.

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  23. The question is: How far can we go down the road to "Socialism/Social Justice" without becoming Europe in its worst.

    I may have overdosed on Pajamas Media, (probably no "may" about it, I still have flashbacks and my hands tremble), but ...

    I think that is the wrong formulation - the hand-wringing angst over the looming threat of socialism, in modern terms, the dangers of an unrestrained coercive State whose powers derive from pursuit of the General Welfare and/or The Commons. It *is* a danger, and probably always will be, (and it is a major component of EUrope's current crisis), but it is *not* the problem we (USA) currently face.

    One can approach it from a couple of different directions.

    One is energy, as you well know. If USA ever manages to get to the "lift-off" stage of a true energy revolution, those who search for "social justice" will be reduced to their proper level within the collective hierarchy of human activity - just another player. The heavy "boot" of socialism only gains traction when the economic machinery is stalled/broken. And energy revolution coupled with a free people will leave the social justice crowd in the dust. (A few more things are needed but that is a general outline of the two biggest drivers.)

    Second, the need for constraining The State pales in comparison to the need for constraining the money guys, if it's not too late. I posted a link to some investor out of Texas named Richard Finger who identified four items for reinvigorating the financial industry as a supporting institution in the free market capitalist system, instead of a separate entity as it is now. His targets were capping executive compensation, prosecuting law-breakers, reform the ratings agencies, and regulate the derivatives space. Get these guys back in the fold and I guarantee you that the social justice people won't be going anywhere - too much of the population will be out there hustling for money and prosperity.

    Third, is roping in the money that drives politics. I have to laugh at the people who wring their hands about socialism in this country. Cripes almighty. Have to leave soon so shorten it up and say that I hope SCOTUS reverses its Citizens United decision. It's a start.

    Those three things make me think that Janet Daley and people like her are all wet. EUrope might think they "see" things more clearly than their hackneyed, barking black sheep if not outright crazy cousins across the pond, but I beg to differ. The EUrope problems boil down to a tiptoe-through-the-tulips elitism. In USA, it's the industrial strength corruption.

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  24. Not much to disagree with there, Max.

    Although, I might be a little less optimistic about our "near-term" energy outlook. :)

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  25. About right Rufus. In the meantime, back to things that really matter:

    Let the Oval Office take care of your Oval Office.

    LINK

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  26. If pressed, I might back down from calling it a broad-based, full frontal "War" on Women but you have to wonder, what's in the water in Virginia?

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  27. The economic slowdown in India is one of the world’s biggest economic stories, but it is commanding only a modicum of attention in the United States.

    ...

    What is disturbing is that much of the decline in the growth rate is distributed unevenly, with the greatest burden falling on the poor. If the slower rate continues or worsens, many millions of Indians, for another generation, will fail to rise above extreme penury and want. The problems of the euro zone are a pittance by comparison.

    China commands more attention, but Scott B. Sumner, the Bentley College economist, has pointed out it is India that is likely to end up as the world’s largest economy by the next century.

    LINK

    A lot can happen in a year or a century.

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  28. I am out the door, but I've been wondering, where is Goldman Sachs et al in the EUrope "crisis?" And no that's not a sarcastic question (likely naive but not sarcastic.) Why can't the bankers "structure" some transition vehicles to help sustain the EUrope during the crisis resolution? Sh^t. I can't even follow the stuff they do anymore but it seems like they're the ones to be consulting. Seems to me like that derivatives space could be put to useful work.

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  29. Same to you, Max.



    As for Goldman/Eu, etc. I think the problem is: They don't know what a "resolution" looks like. For instance, Greece is just flat unsustainable in its present make-up.

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  32. Wow touchy....

    Hate the fact you might be wrong?

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  34. I have the proud honor of being the most censored at this blog...

    Jews need not speak...

    they will be censored.

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  36. No, I warned you that any more baseless slander and I will use a new application by Google that allows me to remove your content effortlessly.

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  45. There has never been one comment on this blog calling for the elimination of the state of Israel. Not one.

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    1. love the way you can delete my answers to your pointed statements...

      kinda like setting the rules as you play eh?

      Delete
    2. Love the way you dismiss Israel's right to be a nation and you think that you are immune to criticism

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  49. why?

    you delete every comment I make and allow others to call me names?

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  50. One standard for all not one standard for the jew and no standards for anyone else

    grow up

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  51. Answer this post deuce really...

    Israel is attempting not to be destroyed by an irrational, jihadist nation

    Obama has declared that Iran will not be allowed to acquire a nuclear weapon.

    So have many leaders in the west.

    Israel has been BEGGING for 12 years for the west to apply strong sanctions, something that STILL has not occurred.

    If Israel is pushed into the corner and the world decides NOT to have a spine?

    Then Israel will do what it needs to do for it's survival.

    After all the world has never lifted a finger to stop genocide of the jews before, why should it start now?

    But what is a genocide of the jews to you deuce?


    there is no baseless slander, it's a real question...

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  52. Is it slander to point out that you have NEVER had a Jew as a bartender?

    You have had openly jew hating people...

    You have had fake lesbian israel haters...

    But never a Jew, not once.... Not Allen, Nor I, Nor Matt...

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    1. I agree with this. WiO should have been a bartender long back in the days when rat and he were going at it day after day. It stuck out like a sore thumb. WiO's posts on the mid east are the most informed here. He called the Egyptian uprising, for instance.

      b

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    2. Matt was a tiresome johnny-one-note and a tedious little sniveling progressive who couldn't stand the heat when he was called for being a collectivist.

      Allen just needed to get laid more. I hope he is now.

      Deuce is a slow learner, but maybe there's a glimmer of hope when the proprietor begins to enforce some sensible rules, albeit long overdue. But civilization didn't occur overnight, either.

      Is this a bar or an outpatient mental clinic?

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    3. You should grab a handle anon and join the (occasional) fun.

      Quite likely the only time I will echo the Patient With ACD.

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    4. Mat wasn't a one-note. He had his ideas on politics, the economy, religion, the environment, and how cities ought to be laid out. Maybe a little extreme sometimes but we all are that. Mat is a good guy.

      b

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    5. .

      Yes, Matt had many ideas, most of them picked and chosen from,

      The Mammoth Book of Cover-Ups: The 100 Most Terrifying Conspiracies of All Time

      Talk about letting the lunatics run the asylum.

      .

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    6. Au Contraire, anon-b, Matt was a noisome little person whose prescriptions when fully examined for their ultimate effects were nothing but socialist dictums veiled in the gauze of progressivism. He never tired of telling everyone else how they should live their lives. But, his batteries were low, it seems.

      You were fond of him for your own reasons, but you never were particularly astute. Maybe you were just lonely and wanted a free tour guide in Israel. Nothing wrong with that, but I'd opt for a hot sabra woman before a conceited pudgy little ex-pat dentist from Toronto.

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  53. .

    Krugman vs Bernanke

    There might have been room for debate a couple years ago; but, IMO, the FED has shot its bullets and has little power to effect the economy in a positive manner right now.

    .

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  54. .

    Obama says that his views on Gay Marriage are still 'evolving'.

    One wonders what his views are on inter-species marriage or is that to politically dangerous also?

    or

    I Robot

    .

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    1. We know, Quirk, we know. You are attracted to the idea of a robot mate because she can be programed to never say 'no'.

      b

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    2. .

      I can see where a guy who recently admitted to being attracted to a lady old enough to be his mother (grandmother?) might say that; however, once again you would be wrong for three reasons.

      During the period I was chasing the ladies, the 'no' rarely entered the picture, at least, not enough to make a difference. And since I left that stage where it could be referred to as the 'sine qua non', I've been perfectly happy with life at home.

      In addition, both you and me will likely be dead by the time they achieve something along the lines of Cheery 2000 or Blade Runner, something that might really make it interesting.

      Finally, how spontaneous could you really get?

      Cherry 2000

      .





      http://www.youtube.com/watch?v=Y6KJtFZoflc

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    3. Good Lord Quirk that is too weird.

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  55. Why does Obama have a Connecticut Social Security card when he has never lived in Connecticut?

    http://www.wnd.com/2012/05/obamas-conn-social-security-number-hits-rush/


    b

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    1. Maybe for the same reason your wife was thinking of voting in Ohio?

      Or the same reason a dog licks his balls?

      Because she/he can?

      Do you find life is so much more pleasant when you stay on your meds, anon-b?

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    2. Go away anon, go back to lurking. You don't fit in here at the out-patient lounge.

      b

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    3. "You don't fit in here..."

      ???????????????????????????????????????????????????????????????????????

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    4. .

      Go away Anon...



      Damn, Bob, even you ought to see the irony in that.

      They are ALL feakin ANONYMOUS.

      .

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  56. ... IMO, the FED has shot its bullets and has little power to effect the economy in a positive manner right now.

    Two points.

    First, "many" argue that the Fed has put its finger in the dike until the political class (re)discovers its proper path and executes legislative action that has thus far been delayed as the Tea Party Congress prolongs its ideological battles with the Beltway establishment.

    Second, one can argue that the central banks can do little of consequence, but (a) neither can governments *near term*, the 'way back' being long and difficult' (but not impossible) and (b) central banks *can* stabilize the interim which allows the one percenters, to use the shorthand, to protect their investments.

    Central banks are very much "front and center" in the current environment. To the extent they retain their prominence in the decision-making hierarchy remains to be seen. But right now, the banks are holding it all together. In USA.

    While the politicians ......

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    1. .

      I disagree.

      The FED's job is to control inflation and promote growth. That's their charter. On the other side they have responsibility for regulating the banks.

      The Fed is controlling nominal inflation (as defined by the FED) but not real inflation as it affects people who are currently getting zip on their investments in government bonds, CD's, etc, i.e. the elderly and those individual Americans who pulled out of the market after 2008 (most Americans).

      Those benefitting by the FED actions are:

      1. The Banks. The banks borrow money at 0% interest and lend it out at a premium with little or no risk. What incentive do they have to take on risk by lending to small companies and start-ups, the real incubators for jobs. Or, they barrow at 0 percent and invest in either derivatives or in foreign debt where they can make some real money.

      2. The FED under Bernanke has also indicated it will support the stock market (which IMO is not included in its mandate). Some might say that might be part of the FED's attempts to promote GDP growth. I say bull. At best, its affects are tangential at worst non-existent currently for most Americans. Indirectly, it may provide some benefit, since over 70% of the markets are owned by institutional investors some of which are pension funds, etc. However, any direct effects remain to be seen. Corporations who benefit are currently sitting on $Trillions rather than investing in jobs.

      3. A sad part of FED regulatory history is that rather than acting as regulators for banks it has more often acted as an advocate.

      However, if by "holding it together" you mean protecting their own, I guess I would agree. Money for nothing and the chicks are free.

      As far as the politicians, they have all the power they need to turn things around. All they lack is the integrity and the balls.

      .

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    2. Of course the Fed action is benefiting the banks. I never said nor implied otherwise.

      Of course the political sector must act. I actually did say as much directly.

      Regarding the Fed mandate, yes, one can argue that QE is an intellectual stretch. My argument in support is that it is a responsible thing to do until Congress finds a road map to their "integrity and balls" (and the Tea Party learns something about governing.)

      We'll have to agree to agree.

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  57. Did you know the US Department of Education has a SWAT Team?

    'Tis true.

    What is the Department of Education doing with a SWAT Team?

    b

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