Daily Digest

Daily Digest 5/21 - Rules May Let Overseas Yuan Return, Peak Oil Market Forecast, Japan Utility Head Resigns Over Nuclear Crisis

Saturday, May 21, 2011, 9:47 AM
  • Treasury Prepares To Plunder Another $45 Billion From Retirement Funds As It Issues $110 Billion More Debt Next Week
  • Rules May Let Overseas Yuan Return: Central Bank
  • Fight intensifies to replace Dominique Strauss-Kahn as head of IMF
  • Libya Revolt Sidelines Women, Who Led It
  • Peak Oil Market Forecast at ASPO Conference in Brussels
  • Japan Utility Head Resigns Over Nuclear Crisis
  • A River’s Crest Arrives, and Is Set to Linger
  • Submerged: Photos from a century of flooding along the Mississippi River

Our 'What Should I Do?' guide has steps to cook, see & stay warm in times of power outage

Economy

Treasury Prepares To Plunder Another $45 Billion From Retirement Funds As It Issues $110 Billion More Debt Next Week (pinecarr)

Now that it has finally been made clear that in order to accommodate the debt ceiling by adding marketable debt, the Treasury has no choice but to literally plunder retirement accounts, we now know that in order to fit in the just announced $110 billion in new bond issuance over the next week, Tim Geithner will have to reduce US retirement funding (the bulk of which, the Social Security Trust Fund already lost $1.1 trillion in the past year) by at least $45 billion.

Rules May Let Overseas Yuan Return: Central Bank (pinecarr)

China is drafting rules to allow overseas companies to invest in yuan on the Chinese mainland as part of efforts to boost the currency's global footing, a central bank official said yesterday in Shanghai.

Fight intensifies to replace Dominique Strauss-Kahn as head of IMF (pinecarr)

The fight for the leadership of the International Monetary Fund (IMF) has intensified after a day that saw investors dump Greek bonds amid concerns of a damaging policy vacuum.

Libya Revolt Sidelines Women, Who Led It (jdargis)

For a revolutionary movement that was started by women — the female relatives of men killed in one of Colonel Qaddafi’s jails — their exclusion at the highest levels is alienating longtime democracy activists and has added to concerns about decision-making in the three-month-old movement, which seems to grow more inscrutable by the day.

Energy

Peak Oil Market Forecast at ASPO Conference in Brussels (Erik T.)

Erik Townsend on ASPO Brussels

Japan Utility Head Resigns Over Nuclear Crisis (jdargis)

Fuel rods appear to have largely melted at three of the plant's reactors after a March 11 earthquake triggered a tsunami that knocked out cooling systems — the world's worst nuclear crisis since Chernobyl. Leaking radiation has prompted the evacuation of thousands of residents, and the perilous struggle to contain the reactors is expected to continue into next year.

Environment

A River’s Crest Arrives, and Is Set to Linger (jdargis)

Police officials here said Thursday that a man pulled from the water earlier in the week had died in the hospital. They said they were still trying to determine whether the death of the 69-year-old man, who had been trying to wade through the floodwaters, was caused by drowning.

Submerged: Photos from a century of flooding along the Mississippi River (jdargis)

The Mississippi River, Mark Twain once wrote, is so uncontainable that "ten thousand River Commissions, with the mines of the world at their back, cannot tame that lawless stream."

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."

22 Comments

HowardBeale's picture
HowardBeale
Status: Member (Offline)
Joined: Mar 4 2010
Posts: 10
Townsend's Presentation

Summary: I thought that, but now I think this. Anything can happen. Things can  go up or down. Thank you. Invest in this.

Poet's picture
Poet
Status: Diamond Member (Offline)
Joined: Jan 21 2009
Posts: 1891
What’s Driving Projected Debt?

 

What’s Driving Projected Debt?
A look at the drivers behind the debt.
http://www.offthechartsblog.org/what%E2%80%99s-driving-projected-debt/

Going deeply into debt to go to war, and cutting taxes at the same time. Well over half of each year's budget deficit ($900 billion to $1 tillion) can be explained by these two ongoing expenses, War in Iraq and Afghanistan alone costing $800 billion above and beyond the pre-war military budget, and tax cuts reducing revenues by even what a Heritage Foundation analyst estimates to be $180 billion a year.

It's like a stupidity Kool-aid our government drank and even today, many politicians refuse to admit it and want instead to focus on everything else in the deficit except the big elephant and calf.

If Brazil had done that to fight Columbia and Peru, everyone would have laughed at and ridiculed the Brazilians and their economy and currency would have tanked! Oh wait...

Poet

 

ewilkerson's picture
ewilkerson
Status: Gold Member (Offline)
Joined: Jul 18 2010
Posts: 390
Somehow people can't

Somehow people can't understand that if you cut taxes BEFORE the same amount of spending you are going to get deficits.  This idiocy started with Reagan.  His budget director even says the Republicans have made it a religion, and it is harming the country.  Cutting spending is the hardest part, so do it first.   If you go and look at charts the VAST majority of debt has been under Republican Presidents.  But oh, "There was a Democratic Congress sometimes."  Does anyone really believe Congress is going to go against a President who wants to  cut their taxes.

We would have been far better off with slightly higher taxes and money spent on our infrastructure.  We would have more jobs and an infrastructure that doesn't need $2-$3 TRILLION spent on it which we don't have.

Well, I could go on but I'll get off my soapbox.

Doug's picture
Doug
Status: Diamond Member (Offline)
Joined: Oct 1 2008
Posts: 3125
zero hedge article

Tyler has this one wrong.  It isn't the SS trust fund that is being plundered, that has been happening right along to the point there is no SS fund money that isn't in the form of Treasury securities.  Now they are plundering Federal employees' retirement funds.  I have some questions about that, but SS recipients can rest comfortably, they ain't plundering what ain't there.

There now, don't we all feel warm and cozy?Cool

Doug

idoctor's picture
idoctor
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Posts: 1731
Somehow people can't

Somehow people can't understand that if you cut taxes BEFORE the same amount of spending you are going to get deficits.

Somehow some people don't understand that when you cut some tax rates the Govt collects more total tax revenue do to more total transactions occurring.

Poet's picture
Poet
Status: Diamond Member (Offline)
Joined: Jan 21 2009
Posts: 1891
You Know What Their Priorities Are By What They Focus On
idoctor wrote:

Somehow people can't understand that if you cut taxes BEFORE the same amount of spending you are going to get deficits.

Somehow some people don't understand that when you cut some tax rates the Govt collects more total tax revenue do to more total transactions occurring.

Idoctor

It was specifically for objections such as yours that I noted the conservative Heritage Foundation's own analysis, that even factoring in the potential revenue-reducing impact of increasing taxes, there would still be $180 billion in additional annual revenue if the Bush tax cuts were repealed.

So, how about the war costing $800 billion over and above pre-war military spending? Why don't we see more opposition from budget hawks on the biggest white elephant in the room? Why the focus instead on more tax cuts and on other programs that individually cost vastly less?

Poet

praxeologue's picture
praxeologue
Status: Member (Offline)
Joined: May 21 2011
Posts: 5
Fukushima

Chris,

I share many of your fears but the Fukushima articles you are posting seem to be like those one with a view is searching to find articles that support.

This is the bio of the man who wrote the piece 'Harvey Wasserman, a co-founder of Musicians United for Safe Energy, is editing the nukefree.org web site. He is the author of SOLARTOPIA! Our Green-Powered Earth, A.D. 2030, is at www.solartopia.org. He can be reached at: [email protected]'

The Japanese have dealt poorly with the crisis but I'd rather focus on expert scientists rather than people with an agenda like this. Thorium nuclear reactors, in non quake zones, in non tsunami zones... let reason prevail.

 

idoctor's picture
idoctor
Status: Diamond Member (Offline)
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Posts: 1731
Ok I get it now...the more

Ok I get it now...the more the Govt takes in the more they fix everything...got itCool.

Poet's picture
Poet
Status: Diamond Member (Offline)
Joined: Jan 21 2009
Posts: 1891
Our Politicians' Priorities
idoctor wrote:

Ok I get it now...the more the Govt takes in the more they fix everything...got itCool.

Idoctor

I don't recall saying that! :-)

I think it's a two-parter for government just like it is for you and me. If we need to balance our budget, we either need to earn more, or we need to spend less.

But what we see from our politicians is going into debt to spend more, while cutting taxes at the same time. And now we see from certain of our politicians that we need to just spend less - but only of some things, so that we can continue to spend more on war.

I'm not asking for the government to take more. I just think it should:

  1. Stop borrowing to spend on war.
  2. Go back to what it was charging before it decided to enact a temporary set of tax cuts that they originally intended to have ended in 2010.

Even #1 would cut our deficit by almost half. Then we can really have some breathing room to address other things we can cut. But certain politicians (and people) are focusing not on the #1 and #2 factors, but instead of they are focusing on the #10, #43, #159, and #307 costs that together don't even add up to half of the cost of #1!

Poet wrote:

So, how about the war costing $800 billion over and above pre-war military spending? Why don't we see more opposition from budget hawks on the biggest white elephant in the room? Why the focus instead on more tax cuts and on other programs that individually cost vastly less?

Again, I ask you, Idoctor, what do you think of the logic of spending $800 billion (half of our annual deficit) on war? It's the biggest elephant in the room and some might argue is currently almost as big as everything else combined. And yet you haven't even addressed it. I guess it's not as high a priority for you as defending tax cuts originally designed to sunset in 2010, right?

Poet

littlefeatfan's picture
littlefeatfan
Status: Silver Member (Offline)
Joined: Jul 20 2009
Posts: 141
Weekly summary of 3E links and cartoons posted

http://3es.weebly.com/

Tommygun's picture
Tommygun
Status: Bronze Member (Offline)
Joined: Apr 21 2009
Posts: 65
tax cuts

So I am led to believe that the Bush tax cuts allow people to keep much of their capital gains. And that when the wealthier keep their capital gains, then they spend more money that they now have because of the tax cuts and then the economy gets better through trickle down economics?

Still waiting for the trickle down to get here.

I say hand out money to the poor. Take the money from where ever it is today. Hand it to the poor. You sure as heck know they can't hang on to it. The poor at least let the money fly out of their hands and into the economy left and right. The wealthy only think of acquiring more for the sake of more in and of itself. How can I make more dough$ ?

There is no peace in wealth and there is no peace in poverty.

 

Neither theory seems to work well.

Tommy

idoctor's picture
idoctor
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Posts: 1731
Ooh for Christ sake Poet I

Ooh for Christ sake Poet I only see two comments I made...not three LOL. As to the logic of spending $800 billion (half of our annual deficit) on war. Hey I wish all the people all over the world would starve the beast of revenue (lower taxes LOL) so none of them would have the revenue to even think of going down this path.

Nate's picture
Nate
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Posts: 573
According to John Williams

According to John Williams (Shadow Stats), if the federal government used GAAP and taxed workers and corporations at 100%, we would still have deficits.  This calculation does not include state or local taxes.  The 0th law of thermodymanics says that which cannot be sustained won't be sustained.

Nate

idoctor's picture
idoctor
Status: Diamond Member (Offline)
Joined: Oct 4 2008
Posts: 1731
One Trillion Seconds =

One Trillion Seconds = 31,688 Years, 269 Days, 1 Hour, 46 Minutes, 40 Seconds.

Wonder if I will live long enough to see the end game LOLLaughing??

Read more: http://wiki.answers.com/Q/How_many_years_is_1_trillion_seconds#ixzz1N1yMaPR8

phecksel's picture
phecksel
Status: Silver Member (Offline)
Joined: May 24 2010
Posts: 204
PLEEEZE We're arguing over a

PLEEEZE

We're arguing over a few billion dollars when the probem is a few thousand billion dollars?

Poet's picture
Poet
Status: Diamond Member (Offline)
Joined: Jan 21 2009
Posts: 1891
Soon We'll Be Talkin' About Real Money Here...
phecksel wrote:

PLEEEZE

We're arguing over a few billion dollars when the probem is a few thousand billion dollars?

I thought I was arguing over $1,000 billion each year (cost of war alone and cost of Bush tax cuts combined)  when the problem each year is $1,600 billion.

Poet

rhare's picture
rhare
Status: Diamond Member (Offline)
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Posts: 1323
Not sure where your getting that $1000B number....
Poet wrote:

I thought I was arguing over $1,000 billion each year (cost of war alone and cost of Bush tax cuts combined)  when the problem each year is $1,600 billion.

Wars since 2001: 1.2T or about  112B/yr

Bust tax cuts: 1.35T over 10 years or about 135B/yr

Looks like $247B/yr not 1,000B.  Not chump change but ending the wars and ending the tax cuts still a long ways from a solution.

CBPP - not exactly non-partisian group.....

TD's picture
TD
Status: Bronze Member (Offline)
Joined: Jun 7 2009
Posts: 51
the cost of war

I've often wondered about how the cost of war is calculated... perhaps someone can help me out?

There is the cost of having a standing military... one that is not at war. All the manpower, the equipment, the training, the bases, the ammo and the fuel used in practice. So once this military force goes to war, is the cost of war the expenses incurred above this standing armed force? or suddently does the cost of keeping a standing army become incorporated into the cost of war?

TD

ewilkerson's picture
ewilkerson
Status: Gold Member (Offline)
Joined: Jul 18 2010
Posts: 390
War, Taxes, Debt

I agree Poet.  GW is the first major leader in 2000 years to cut taxes while going into a war.  We have been completely irresponsible.

idoctor's picture
idoctor
Status: Diamond Member (Offline)
Joined: Oct 4 2008
Posts: 1731
(No subject)

Kinetic Actions & Humanitarian bombs LOL....

rhare's picture
rhare
Status: Diamond Member (Offline)
Joined: Mar 30 2009
Posts: 1323
Cost of war...
TD wrote:

I've often wondered about how the cost of war is calculated... perhaps someone can help me out?

I believe the cost that Poet quoted ($800B) is the total defense budget, so that includes the war and all other defense spending.  Of course it's a bit fuzzy, but for our discussion the numbers are all close enough.  This link breaks down the budget for a total value of $685B which is about right for the $800B with the wars.

The point I tried to make is that when you say $800B for the wars, it was off by almost an order of magnitude.  Now whether you think the current military spending less the wars is acceptable is another discussion. Just want us to at least acknowledge that ending the ways and removing all the bush tax cuts still don't begin to address the problem we face.

Poet's picture
Poet
Status: Diamond Member (Offline)
Joined: Jan 21 2009
Posts: 1891
Yes, I Was Mistaken
rhare wrote:

I believe the cost that Poet quoted ($800B) is the total defense budget, so that includes the war and all other defense spending.  Of course it's a bit fuzzy, but for our discussion the numbers are all close enough.  This link breaks down the budget for a total value of $685B which is about right for the $800B with the wars.

Rhare

You're right. I was obviously mistaken. The cost of war luckily is NOT $800 billion per year. Whew.

Obviously the "oomph" you'd get from stopping the war and allowing the Bush tax cuts to sunset (as the original architects intended it to).

So no longer the hoped for $1,000 billion reduction from the $1,600 billion annual Federal deficit. If only it were that easy.

Still, while almost $250 bilion a year ($112/year and $135/year per Rhare's earlier links) in potential deficit reduciton is nowhere as big as a potential $1,000 billion a year reduction, together they're still a big 15% chunk of the deficit that could be pared down.

(Although according to this link, which draws from the Center for Defense Information, the cost of war in Iraq and Afghanistan was $171 billion and $170.7 billion for Fiscal Years 2010 and 2011, respectively.) In that case, ending the two (war and Bush tax cuts) could bring the deficit down by 19%.)

Poet

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