Daily Digest

Daily Digest 11/3 - The Inevitable Jubilee, BofA Renegs On Debit Card Fees, Renewable Energy Held Back By Fossil Fuel Subsidies

Thursday, November 3, 2011, 9:48 AM
  • Lessons to Learn - Global Bullion Exchange - Gold and Silver Scam Exposed
  • The Inevitable Jubilee
  • Bad Moon Rising
  • In Retreat, Bank of America Cancels Debit Card Fee
  • Would You Buy a Nissan Leaf or Chevy Volt?
  • Renewable Energy Being Held Back by Fossil Fuel Subsidies - IEA
  • South African Rural Schools to Receive Solar Powered Internet
  • Reactor in Japan Restarts, a First Since the Tsunami

Learn how to protect your wealth against the Three E forces using our 'What Should I Do?' guide

Economy

Lessons to Learn - Global Bullion Exchange - Gold and Silver Scam Exposed (adam)

By offering "leverage accounts" investors were sold via greed. They were told that by utilizing additional financing to buy more metals, they could then see more upside and higher returns on their investments. These folks were most probably not warned about their account's liquidation in a short term sell off.

The Inevitable Jubilee (adam)

For most of us, there’s absolutely no way we could finance our current standard of living without either borrowing or living off credit. This simple fact of life for those who live in societies where lending and credit are freely available—which also drives up prices—may find it hard to understand that other “less developed” countries don’t live like we do. That is, quite surprisingly, they used hard-saved cash for their purchases rather than borrowing from a bank or “money lender” and paying interest.

Bad Moon Rising (JimQ)

The ECRI has called the last three recessions with no instances of false alarms. Last week, the Conference Board announced the Consumer Confidence Index plummeted to two and a half year low of 39.8, last seen in March of 2009. The Dow Jones was trading at 6,500 in March 2009, some 47% below today’s level. It is an interesting dichotomy between how the average American feels about the world and how the Wall Street elite feel about their Ben Bernanke sheltered world. The Consumer Confidence Index was 110 in 2007 and 140 in early 2001. We’ve come a long way baby.

In Retreat, Bank of America Cancels Debit Card Fee (jdargis)

“We have listened to our customers very closely over the last few weeks and recognize their concern with our proposed debit usage fee,” David Darnell, co-chief operating officer at Bank of America, said in a statement. “As a result, we are not currently charging the fee and will not be moving forward with any additional plans to do so.”

Energy

Would You Buy a Nissan Leaf or Chevy Volt? (JRB)

"We forget to take into account the energy used to produce the electricity that recharges batteries. Electric vehicles look clean, but they simply move the energy source out to an electric power plant in someone else's backyard. Also, if we look at the entire thermodynamic equation, from the materials used in batteries to the end devices, an electric vehicle just doesn't make sense in terms of overall energy use.

Renewable Energy Being Held Back by Fossil Fuel Subsidies - IEA (James S.)

The IEA blames electricity/heat generations and transportation as the major culprits of nearly two-thirds of carbon dioxide emissions. IEA's World Energy Outlook 2011 report, to be released in early November, the agency recommends a halt on fossil fuel subsidies to reduce emissions and encourage renewable energy development.

South African Rural Schools to Receive Solar Powered Internet (James S.)

According to Samsung Electronics Africa, the Solar Powered Internet School can be trucked to remote areas and is designed to work in harsh weather conditions, while solar panels obviate the need for grid electricity supplies. Designed to run for nine hours a day, the most enduring aspect of the project is that its storage batteries will allow the Solar Powered Internet School to operate for one and a half days without any sunlight at all. Samsung Electronics Africa has ruggedized the Solar Powered Internet School, replacing the glass photovoltaic panels with ones made of rubber to better cope with Africa’s less than perfect roads.

Reactor in Japan Restarts, a First Since the Tsunami (jdargis)

Yasushi Furukawa, the governor of Saga Prefecture, has wavered on whether to allow restarting two idle reactors at the Genkai Nuclear Power Plant. Seen as a bellwether for the rest of Japan, Mr. Furukawa had appeared to be moving toward allowing two of the reactors to restart but his decision was put off after revelations of a scandal over faked supportive e-mails sent by employees of the local Kyushu Electric Power Company posing as pro-nuclear citizens.

Article suggestions for the Daily Digest can be sent to [email protected]. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."

11 Comments

saxplayer00o1's picture
saxplayer00o1
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rjs's picture
rjs
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Posts: 445
Someone should really do something

YESTERDAY, the Federal Reserve released a new statement in which the only real change from the previous meeting's statement was that the language concerning the outlook for the economy got a little brighter. Then they released new economic projections:

You'll note that the Fed's forecast has—yet again—been revised downward. The central bank now anticipates that the unemployment rate will be around 8% in 2013. That's 6 years after the onset of recession, 4 years after the beginning of the recovery, and that's 2 full percentage points above the Fed's upper-end estimate of the long-term natural rate of unemployment. Given this clear and substantial admission of its own continued failure, the Fed obviously opted to do more, right?

No, in fact, you'll be shocked to learn that it did not. Ben Bernanke complained about fiscal policy in yesterday's press conference, but that, in a way, is more damning still. The "independent" institution with the best chance of eliminating the aggregate demand shortfall so painfully obvious in its forecast is pleading with others to do its job for it. I half wish he'd have the decency to argue that unemployment was all structural. At least then we could blame the Fed's failure on ignorance rather than incompetence, or cowardice.

wtrbfflo's picture
wtrbfflo
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Posts: 3
what can be done?

I was under the impression that the FED is out of bullets and no QE3,4....1000 could do anything.  If he attempts to eliminate the "aggregate demand shortfall" does he not just pull demand forward by removing future demand? 

Poet's picture
Poet
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Questions for RJS

RJS

How exactly is the Federal Reserve supposed to generate more demand? For what? Are you saying the Fed should print more money? Won't that devalue our currency and devalue people's hard-earned savings? Has previous printing solved the recession/depression?

 

rjs wrote:

The "independent" institution with the best chance of eliminating the aggregate demand shortfall so painfully obvious in its forecast is pleading with others to do its job for it. I half wish he'd have the decency to argue that unemployment was all structural. At least then we could blame the Fed's failure on ignorance rather than incompetence, or cowardice.

RogerA's picture
RogerA
Status: Silver Member (Offline)
Joined: Jun 18 2009
Posts: 106
Preparing for the crisis.

Some quotes from the news here. Translated, no link, since it is in norwegian.

The crisis in the EU may affect Norway with dramatic force already before Christmas. Minister of finance Sigbjørn Johnsen is prepared for the worst.

- The day Greece does not pay its debt, many European banks do not get their money. I believe interest rates on Spanish and Italian bonds will skyrocket and trigger a crisis that will affect Norway overnight, he said.

- It will in the short term be more expensive and more difficult for households in Norway to get a loan, said chief economist Frank Jullum in Fokus Bank.

rjs's picture
rjs
Status: Gold Member (Offline)
Joined: Aug 8 2009
Posts: 445
answering your question?
Poet wrote:

RJS

How exactly is the Federal Reserve supposed to generate more demand? For what? Are you saying the Fed should print more money? Won't that devalue our currency and devalue people's hard-earned savings? Has previous printing solved the recession/depression?

 

rjs wrote:

The "independent" institution with the best chance of eliminating the aggregate demand shortfall so painfully obvious in its forecast is pleading with others to do its job for it. I half wish he'd have the decency to argue that unemployment was all structural. At least then we could blame the Fed's failure on ignorance rather than incompetence, or cowardice.

i'm not saying that; that is a link from Ryan Avent at the Economist's blog; i posted it more for the Fed's forecasts than the accompanying rant...

myself, i'm skeptical that monetary policy can accomplish much; but the past few weeks there have been a plethora of economic blog posts advocating that the Fed initiate NGDP targeting after a goldman sachs economic note which recommended the Fed abandon their low inflation target and instead target nominal GDP, which was subsequently endorsed by paul krugman, almost as a last resort...this isnt a new idea, in fact, it's been advocated for years by a couple market monetarists who've i've always thought to be somewhat quixotic, scott sumner and david beckworth...if you want more info on that, check out the daily links section at mark thoma's economist's view; it seems almost every day he has articles about it...

Poet's picture
Poet
Status: Diamond Member (Offline)
Joined: Jan 21 2009
Posts: 1892
Thanks For Clarifying, RJS

Okay, RJS. Thanks for clarifying.

While sometimes borrowing to spend into a recession can help, it only works if it's a recession we can truly recover from, based on there being much more available exploitable resources out there to bring into the economy to make up for the stimulus/debt.

Today, we don't have vast new frontiers that feature a potential for vast new growth that could make the massive debt overhangs negligible. This makes Keynesian stimulus and debt a fatal toxin (as it isually is in most cases). Just like borrowing on credit cards to cover living expenses - if you find a new and better job soon, great. If not, you're even more royally screwed.

Poet

rjs wrote:
Poet wrote:

RJS

How exactly is the Federal Reserve supposed to generate more demand? For what? Are you saying the Fed should print more money? Won't that devalue our currency and devalue people's hard-earned savings? Has previous printing solved the recession/depression?

i'm not saying that; that is a link from Ryan Avent at the Economist's blog; i posted it more for the Fed's forecasts than the accompanying rant...

myself, i'm skeptical that monetary policy can accomplish much; but the past few weeks there have been a plethora of economic blog posts advocating that the Fed initiate NGDP targeting after a goldman sachs economic note which recommended the Fed abandon their low inflation target and instead target nominal GDP, which was subsequently endorsed by paul krugman, almost as a last resort...this isnt a new idea, in fact, it's been advocated for years by a couple market monetarists who've i've always thought to be somewhat quixotic, scott sumner and david beckworth...if you want more info on that, check out the daily links section at mark thoma's economist's view; it seems almost every day he has articles about it...

rjs's picture
rjs
Status: Gold Member (Offline)
Joined: Aug 8 2009
Posts: 445
further clarification

government debt is not like a personal credit card or home loan that an individual must eventually pay off...any long lived institutions, such as governments or corporations, can carry large amounts of debt indefinitely....

 

In 1831, the National Debt Burden per Capita, or rather the ratio of the United States' national debt per capita and GDP, multiplied by 1 billion), dropped below a value of 3 for the first time in its history [1]. In 2011, the U.S.' National Debt Burden per Capita has risen above that level.

Let's look at what happened to the U.S.' National Debt Burden per Capita in between, shall we?

U.S. National Debt Burden per Capita

MrEnergyCzar's picture
MrEnergyCzar
Status: Bronze Member (Offline)
Joined: Oct 14 2010
Posts: 54
Volt helps me Prepare for Peak Oil...

The Volt may take enormous energy to make thus isn't a "solution" but if you want to hedge your family against rising energy prices, it makes sense.  I drove 1,300 miles in one month on my first gallon with the Volt.   I plan on saving 30k over 9 years versus my former SUV.  I attached my review of the Volt here....

MrEnergyCzar

 

 

saxplayer00o1's picture
saxplayer00o1
Status: Diamond Member (Offline)
Joined: Jul 30 2009
Posts: 4239
California deficit may reach $8 billion: Assembly memo

 

 

"California's government could face a budget gap of up to $8 billion in its next fiscal year, substantially more than the $3.1 billion shortfall projected by Governor Jerry Brown's office, The Sacramento Bee said on Thursday, citing a memo from Assembly budget officials."

KennethPollinger's picture
KennethPollinger
Status: Platinum Member (Offline)
Joined: Sep 22 2010
Posts: 656
China's long-term role in the decline of America

 Why isn't this Crash Community commenting on China's role in all these upheavels?

I recently read Red Alert: How China's Growing Prosperity Theatens the American Way of Life, by

Stephen Leeb, Ph.D.   Regardless of what happens with Europe, China is buying up most natural

resources around the world and it's State Capitalism strategy is causing the prices of many

commodities to shoot up now and especially in the future.  Already they "control" rare earth

elements and the solar industry, not mentioning how they have 5-10-15 year plans to become

the world's most "alternative energy" nation, while we fiddle away our opportunities in this area.

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