Daily Digest

Daily Digest 6/16 - Weak Economy Drives Copper Theft, Is Bernanke Sabotaging The Chinese Economy?, The Long & Short Of Peak Oil

Thursday, June 16, 2011, 9:49 AM
  • Where Did All The QE2 Money Go?
  • What Are The Social Implications Of Economic Collapse?
  • Weak Economy Drives Theft Of Copper Wiring
  • City's Family Shelters Are Filling Up Faster, Sooner 
  • Is Ben Bernanke Sabotaging The Chinese Economy? 
  • Peak Oil: The Long And The Short
  • In Japan, The Recorded Mass Mortality Of Fish
  • Renewable Electricity Generation Continues To Increase
  • Garden Flourishes Beside Asphalt

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Economy

Where Did All The QE2 Money Go? (Darren E.)

In summary, instead of doing everything in its power to stimulate reserve, and thus cash, accumulation at domestic (US) banks which would in turn encourage lending to US borrowers, the Fed has been conducting yet another stealthy foreign bank rescue operation, which rerouted $600 billion in capital from potential borrowers to insolvent foreign financial institutions in the past 7 months. QE2 was nothing more (or less) than another European bank rescue operation!

What Are The Social Implications Of Economic Collapse? (June C.)

Simply put, the United States and much of Europe are borrowing an extraordinary amount of money now just to pay interest on the money they’ve already borrowed. They cannot even self-fund their mandatory entitlement programs without going into the hole, and their options are limited ...

Weak Economy Drives Theft Of Copper Wiring (June C.)

Always a problem, metal scavengers have become more brazen in the economic downturn, authorities said, sometimes endangering public safety across Philadelphia and South Jersey.

They're removing brass fittings from water hydrants and wiring from cellular towers, telephone networks, and railroad lines such as PATCO.

City's Family Shelters Are Filling Up Faster, Sooner (June C.)

With nowhere to go, Goodmond and her two children went to the emergency room at Hahnemann University Hospital. They slept in chairs in the waiting room and slipped out in the morning.

But their welcome was wearing out. On Monday night, Goodmond asked her cousin to watch her 5-year-old daughter for a few days, while turning to her grandmother for help with her 2-year-old son.

Is Ben Bernanke Sabotaging The Chinese Economy? (adam)

In standard monetary theory, a country's currency may fluctuate with the country's balance of trade. If a country is a major exporter, the currency of that country may appreciate, while countries that are major importers might see their currencies fall in value.

As China is a major exporting power, the value of China's currency—the yuan—might be expected to rise to reflect China's manufacturing might.

Energy

Peak Oil: The Long And The Short (JimQ)

Peak oil has been a mathematically predictable occurrence since American geophysicist M. King Hubbert figured out the process in 1956. His model predicted that oil production in the United States would peak in 1970. He wasn’t far off. In 1971, when the U.S. was producing 88% of its oil needs, domestic production approached 10 million barrels per day and has been in decline ever since.

In Japan, The Recorded Mass Mortality Of Fish (guardia)

Mysterious death for nearly 10,000 trout occurred in Japan's Ishikawa Prefecture – Local Asano river for several kilometers is covered with dead fish, ITAR-TASS. The first tests indicate that no oil, no harmful chemicals in the water there. It is located hundreds of kilometers from the emergency NPP Fukushima-1. Increasing levels of radiation or radioactive fallout there is not fixed, but given the difficult situation with the nuclear power station, suspicions fall primarily on her.

Renewable electricity generation continues to increase (NZSailor)

Our high level of renewable generation and the use of gas over coal at the Huntly Power Station has also resulted in the lowest quarterly electricity emission in ten years.

“Our Government has a target of 90 per cent of electricity generation to be from renewable sources by 2025, we are well on our way to achieving that."

Environment

Garden Flourishes Beside Asphalt (joemanc)

In front of the N.D.G. Food Depot's west-end headquarters, herbs, tomatoes, potatoes and turnips are growing in newly built wooden planters.

Inside the grey industrial building on Oxford Ave., mushrooms are growing in plastic buckets and bean sprouts fill glass jars. Volunteer cooks will use the fresh produce to prepare meals for some of the thousands of people who go to the food depot for help every year.

This small-scale agriculture project is part of a bigger plan by the food bank to branch out into practising permaculture, a system of ecological design that includes organic gardening, reducing waste and building strong communities.

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."

13 Comments

saxplayer00o1's picture
saxplayer00o1
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Spanish yields soar after luke-warm auctions

"The 10-year Greek bond yield surged 25 basis points to a new record of 17.59%, with the bond price trading perilously close to half its face value. Spanish and Portuguese bonds also bore the brunt of the souring of sentiment, with Spanish 10-year yields rising by 18 basis points to 5.72%, and Portuguese yields up 14 basis points to 11.17%.

The cost of insuring Greek sovereign debt continued to set records Thursday as Papandreou. At 0727 GMT, the Greek five-year credit default swap spread was 94 basis points wider at 1820 basis points, according to data provider Markit."

.........................1A) Greek Debt Insurance Costs Hit Record Level; CDS At 1820 BPs

.........................1B) EURO GOVT-Greek CDS hits new record at 1900 bps

...........................1C) Greece, Ireland, Portugal Lead Sovereign Credit-Default Swaps to Records

"The Swiss central bank has sounded a warning over the health of the country's two biggest banks, saying they could face "considerable losses" if sovereign debt crises elsewhere worsen.

As southern European neighbour Greece edged closer to the brink of a debt default, Thomas Jordan cautioned that Credit Suisse and UBS could be put at risk."

................2A) UBS, Credit Suisse Must Bolster 'Thin' Capital Buffers, Central Bank Says

"Europe's sovereign-debt crisis washed closer to U.S. shores Wednesday after Moody's Investors Service warned it may downgrade three French banks that rely heavily on U.S. money funds for short-term financing.

Moody's cited the banks' exposure to Greek debt, and added that it may do the same to other euro-zone banks."

"DUBLIN—Bank of Ireland Chief Executive Richie Boucher had eggs pelted at him at a shareholders' meeting Wednesday, as one of Ireland's last surviving major lenders seeks to raise billions of euros more in capital in the coming weeks.

The bank, which is already 36% owned by the Irish government after receiving €3.5 billion ($5.05 billion) in bailout aid, needs €5.2 billion more in capital and new buffer reserves, mainly to make good lending excesses during the boom years."

"Spain had to pay investors a handsome price in the latest test of demand for its debt on Thursday as market tensions over an expected new rescue package for Greece approached fever pitch.

The Treasury sold 1.3 billion euros of a 2019 bond last auctioned in Dec. 2009, and 1.5 billion euros of a 15-year bond last issued via syndication in March. The total was below the middle of its 2.5-3.5 billion euro target.

The bonds were reasonably well received despite a fraught week for euro zone periphery debt, which saw yields on Spanish 10-year bonds soar to 11-year highs on Thursday as politicians struggled to agree on a plan for staving off a Greek default."

...............5A) EURO GOVT-Spanish yields at 11-year high ahead of auction

................5B) Spain Misses Maximum Target at Bond Auction as Yields Surge

.................5C) EURO GOVT-Spanish yields soar after luke-warm auctions

"While fears stirred by Greece’s deepening debt crisis raced Wednesday through global financial markets, a quick check of U.S. banks showed they risk losses on tens of billions of dollars should the Mediterranean nation default on its payments.

U.S. banks had total exposure of $41 billion to Greece by the end of 2010, according to the latest figures from the Bank for International Settlements issued June 9. Most of the financial commitments appear to be indirect.

About 83% is tied to “guarantees” that range from protection for sellers of credit derivative contracts to other obligations owed to third parties. Still the data are murky, according economic consultant Kash Mansori.

“We don’t know exactly what the form of exposure is,” said Mansori, who authors the Street Light blog. “We can only make educated guesses.” "

"Faced with a deepening recession two years ago, the Obama administration injected billions of dollars into Medicaid, the nation’s low-income health program. The money runs out at the end of this month, and benefits are being cut for millions of people, even though unemployment has increased.

From New Jersey to California, state officials are bracing for the end to more than $90 billion in federal largesse designated for Medicaid. To hold down costs, states are cutting Medicaid payments to doctors and hospitals, limiting benefits for Medicaid recipients, reducing the scope of covered services, requiring beneficiaries to pay larger co-payments, and expanding the use of managed care.

As a result, costs can be expected to rise in other parts of the health care system."

.....................7A) Medicaid cuts to force health care costs higher

......................7B) States to lose $90 billion in Medicaid funding

"The Philadelphia Fed's manufacturing index fell from +3.9 in May to -7.7 in June, which is the worst level in 31 months. Economists polled by MarketWatch had forecast a reading of +5.5. The survey's indicators for activity and new orders turned negative this month, while indicators for shipments and employment fell but remained slightly positive, the Philly Fed said. The figures come after a negative reading on Wednesday from a similar New York-area gauge."

  • Other news, headlines and opinion:‎

We're only halfway through seven lean years, warns Governor of the Bank of England

Greek PM says will form new govt after mass protest

Violence in Athens over Greek debt crisis

Ireland seeks to go after Anglo's senior bondholders and Ireland Opens New Front as ECB Battles Against Meltdown

ECB's Wellink calls for doubling bailout fund and Greek Debt Rollover Requires Doubling Rescue Fund, Wellink Says

Biden-led budget talks face daunting odds

Japan buys 1.1 bln euros of bonds to help Portugal

Fitch Downgrades Hawaii GOs to 'AA'; Outlook Revised to Stable

Oakland County's Patterson: We just can't merge with Pontiac ("Patterson said his financial team examined Pontiac’s books and estimated the city will run out of cash within four months")

American Red Cross Announces Layoffs

Asia Bond Risk Rises to 6-Month High, Credit-Default Swaps Show

Tornado clean up strains Missouri budget

IMF official 'concerned', ready to support Greece ("The situation changed very dramatically in the last 24 hours")

Irish Payrolls Drop; Unemployment Falls as Labor Force Shrinks

Greek opposition calls on Papandreou to resign

S Korea Won Falls To 3-Week Low; BOK Likely Intervened To Provide Support

Belarus protesters answer Internet call, defy Lukashenko

UK bank ring-fence plans credit negative-Moody's

Standard & Poor's Fu Says China Home Prices May Fall 10%

Hollywood city manager quits amid budget woes

Santa Rosa facing years of hard budget choices

Deficit hits bus system (SC..."We had no idea we were going to have a shortfall of this magnitude")

Jurist says massive budget cuts will damage court system (California)

Community colleges feel battered by budget (California)

Calif. budget passes — with higher taxes (Scroll down to see details)

Greece riots: RT film crew get caught in Athens street protests (Video)

Thousands protest Greek austerity [CNN: 6-15-2011] (Video)

States Want More in Pension Contributions

School pension system facing dire situation (Pennsylvania)

India Extends Longest Streak of Interest-Rate Increases to Curb Inflation

IEA piles pressure on OPEC to pump more oil

Violent clashes in Chile (Video)

Hungary to Breach EU Budget Limit, Needs Further Steps, IMF Says

IMF seen releasing Greek funds despite EU delay

Canadian Finance Minister Urges US to Cut Deficit

es2's picture
es2
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Nebraska nuke plant totally surrounded by floodwaters

Nebraska nuke plant totally surrounded by floodwaters: How can Omaha levees hold? Dykes designed for a few weeks of water — 3-4 months expected, with 5+ foot rise http://enenews.com/nebraska-nuke-plant-totally-surrounded-floodwaters-om...

Google makes Business Case for Wind http://www.energybiz.com/article/11/06/google-makes-business-case-wind?u...

es2's picture
es2
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Posts: 68
Thanks!

Thanks to everyone that submits news articles!  The DD is a nice resource.

SailAway's picture
SailAway
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Posts: 404
Where Did All The QE2 Money Go?

This ZH post above (this link http://www.businessinsider.com/where-did-all-of-the-qe2-money-go-2011-6)  is just unbelievable!

The financial elites just keep screwing us over and over...

Would love to read Dr Martenson and others comments on this.

 

 

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rjs
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Posts: 445
Biden led budget talks

Being Early to the Party: Bad for Links, But Good for Information

somewhat obtuse, but just follow his links, you'll get it...

 

Damnthematrix's picture
Damnthematrix
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Aussie market's big slide on Greece fears

Aussie market's big slide on Greece fears

Fears over Greece's debt problems have wiped about $25 billion off the Australian share market.

A steep fall of almost 2 per cent dragged the benchmark ASX 200 share index to its lowest level since September last year.

Market analyst Peter Esho from City Index says the index has slipped through an important psychological barrier.

"Today's fall is significant. It's large. We've breached the 4,500 mark," he said.

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cchristian
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r's picture
r
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Posts: 262
Government 'may have hacked IMF'

"Hackers who broke into the International Monetary Fund's computer system may have been backed by a nation state, according to security experts.

They point to the sophisticated nature of the attack and the resources needed to develop it."

http://www.bbc.co.uk/news/technology-13748488
http://www.bbc.co.uk/news/world-us-canada-13740591
http://www.nytimes.com/2011/06/12/world/12imf.html?_r=1&hp

Doug's picture
Doug
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Posts: 3124
Robert Reich....

....explains what's wrong with the economy in 2:38.

http://front.moveon.org/scribbling-sharpie-illustrates-the-truth-about-our-economy/#.Tfo8lV9YPOc;facebook

Doug

ewilkerson's picture
ewilkerson
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Posts: 390
QE2 to Europe

Could soumeone explain to me how the fact that our economy did not get any of QE2 will affect the possibility of hyperinflation?  Thanks

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Nate
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Posts: 572
Doug wrote: ....explains
Doug wrote:

....explains what's wrong with the economy in 2:38.

http://front.moveon.org/scribbling-sharpie-illustrates-the-truth-about-our-economy/#.Tfo8lV9YPOc;facebook

Doug

Robert Reich understands part of the first E and totally missed Energy and Environment.  I think the link should have been moron.org 

mazanda's picture
mazanda
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Posts: 78
Where did QE2 money go?

http://www.businessinsider.com/where-did-all-of-the-qe2-money-go-2011-6

Love to hear Chris Mortensen's take on this artricle.

ewilkerson's picture
ewilkerson
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Posts: 390
Where did QE2 go?

I'd love to get his response to it as well.  We have been operating on the belief that the only thing keeping the economy (i.e. markets) going was QE2.  The money could not have gone both places.

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