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CitiBank - No Questions Asked

Tuesday, November 25, 2008, 3:24 PM

When the Big Three automakers were finally settled in their chairs before the Congressional committee investigating whether they deserved a handout of $50 billion, they were asked a defining question; “How many of you flew commercial airlines to get here?

No hands went up and they were sunk. Somehow the hubris of trotting about on private jets while asking for public money was simply too much for a suddenly stingy Congress.

No such questions were asked of the Citi bankers, in fact no hearings were even held, and they were given access to over $306 billion on the most favorable terms you could possibly imagine. This illustrates the power that the banking industry holds over our political process and it is a ruinous power. Why should Citi receive not only special treatment, but exorbitantly preferential treatment at taxpayer expense? I don’t know, but I’d like some answers.

First, check out the terms of the deal:

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Daily Digest - Nov 25

Tuesday, November 25, 2008, 1:15 PM

Economy

Turkeys Can't Fly 

'In the space of two months, Ben Bernanke has doubled the balance sheet of the Federal Reserve. He is accepting bubble gum wrappers, old shoes, and Dick Cheney's defaced copy of the Constitution as collateral for loans from the Fed. When Paulson and Bernanke were selling their rescue plan in front of Congress in September they stressed transparency, oversight and openness. The total lack of transparency and oversight were the reason that our financial system came to a grinding halt.' 

Sherman's Comments: Of all my reads yesterday, this one was clearly the best. I hope you enjoy it as much as I did.Quinn really nails the "Negative Wealth Affect," I wasn't one hundred percent on-board with the big 3 numbers but my guess is that his university isn't weathering a storm like Harvard's as the result of his insight. Just a guess.

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The Fed Is Out Of Ammunition

Monday, November 24, 2008, 6:09 PM

This title is not mine, but that of an article that appeared in The Wall Street Journal today (Nov 24), which closely mirrors my own assessment of where we are and what is likely coming next. In short, deflation is so unacceptable to a debt-based money system that it will be avoided at all costs. And I do mean all costs.

This was written by an equity strategist in Hong Kong; be sure to catch his startling conclusion at the end. Startling because of where it was printed – in the main circular of the high church of fiat money, a.k.a. the WSJ.

The whole thing is worth a read, and a ponder, but let’s review some of the more relevant bits.

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Daily Digest - Nov 24

Monday, November 24, 2008, 12:29 PM

Economy

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Fed Pledges Top $7,400,000,000,000.00 (trillion) to Ease "Frozen Credit" 

Nov. 24 (Bloomberg) -- The U.S. government is prepared to lend more than $7.4 trillion on behalf of American taxpayers, or half the value of everything produced in the nation last year, to rescue the financial system since the credit markets seized up 15 months ago. 

The unprecedented pledge of funds includes $2.8 trillion already tapped...

..When Congress approved the TARP on Oct. 3, Fed Chairman Ben S. Bernanke and Treasury Secretary Henry Paulson acknowledged the need for transparency and oversight. Now, as regulators commit far more money while refusing to disclose loan recipients or reveal the collateral they are taking in return, some Congress members are calling for the Fed to be reined in.

"Whether it's lending or spending, it's tax dollars that are going out the window and we end up holding collateral we don't know anything about," said Congressman Scott Garrett, a New Jersey Republican who serves on the House Financial Services Committee. "The time has come that we consider what sort of limitations we should be placing on the Fed so that authority returns to elected officials as opposed to appointed ones." 

Sherman's Comment: $24,000.00 per every man woman and child?! That might have stimulated the economy had it have been disbursed differently. In any event monetizing debt of this size will have far reaching ramifications.

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The Daily Digest - Nov 23

Sunday, November 23, 2008, 10:06 AM
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The Daily Digest - Nov 22

Saturday, November 22, 2008, 5:08 PM
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The Daily Digest - Nov 21

Friday, November 21, 2008, 10:40 AM
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Your donations are keeping the site alive

Thursday, November 20, 2008, 5:45 PM

Six weeks ago, I posted a note to this blog introducing myself as the site's volunteer Business Manager, and describing my decision to add advertising to the site to recover some of the site's operating costs. 

That announcement led to some lively discussion, and suggestions from members that we should also consider other options such as an easier-to-use mechanism for direct donations, and an affiliation with Amazon.com. I'm writing today to update you on our progress, and to report that overwhelmingly, direct donations have been of crucial importance to keeping the site just barely running in the black.

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The Daily Digest -Nov 20, 2008

Thursday, November 20, 2008, 1:26 PM

Hello,

Chris here.

I’d like to introduce D. Sherman Okst whom many of you know as Davos on the site. I’ve really liked the links that Sherman has been finding and posting throughout the site and I asked him if he’d be willing to post them directly to a blog where more people might see them. Sherman has graciously offered to do this and so I want you all to welcome him as a contributor at large for the Daily Digest.

Welcome Sherman!

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The Daily Digest

Thursday, November 20, 2008, 11:30 AM

This is a new feature.

It provides news snippets and links on a more frequent basis.  The plan is to try and get this up every day, but we'll see how that goes.  For now, enjoy.


 
Jobless claims jump unexpectedly to 16-year high

WASHINGTON (AP) --

New claims for unemployment benefits jumped last week to a 16-year high, the Labor Department said Thursday, providing more evidence of a rapidly weakening job market expected to get even worse next year.

The government said new applications for jobless benefits rose to a seasonally adjusted 542,000 from a downwardly revised figure of 515,000 in the previous week. That's much higher than Wall Street economists' expectations of 505,000, according to a survey by Thomson Reuters.

That is also the highest level of claims since July 1992, the department said, when the U.S. economy was coming out of a recession.