Daily Digest

Daily Digest 6/6 - Grim Long-Term U.S. Debt Picture, Soaring Deductibles New Normal, Students Pay Credit Card Rates On Loans

Wednesday, June 6, 2012, 9:36 AM
  • ECB To Hold The Line As Euro Crisis Deepens
  • CBO paints grim long-term debt picture for US
  • Global slump alert as world money contracts
  • Tuition Increases At Oregon Universities
  • Soaring deductibles are the new normal for Fortune 500
  • Students pay rates as high as credit cards on loans
  • Japan Lawmakers Push to Curb Central Bank
  • Payless paydays for Scranton near as borrowing halted
  • Portuguese Builders on ’Verge of Collapse,’ Industry Group Says
  • Angry customers confront water district at meeting
  • Euro slumps on Spain warning, G7 fails to raise hopes
  • Alarm grows in Russia as ruble continues to lose

Follow our steps to prepare for a world after peak oil, such as how to store & filter water

Economy

ECB To Hold The Line As Euro Crisis Deepens

nvestors are hoping ECB president Mario Draghi will signal that some sort of rescue effort is in the works, when the central bank holds its monthly meeting in Frankfurt Wednesday.

ECB officials will be meeting amid a deepening banking crisis in Spain and ahead of a pivotal election in Greece that could determine whether the nation remains in the eurozone.

CBO paints grim long-term debt picture for US

The US debt will exceed the size of the nation's economy in 25 years if the federal government doesn't chart a "sustainable fiscal course," the Congressional Budget Office warned in a new estimate on Tuesday.

In its 2012 long-term budget outlook, the nonpartisan CBO said that extending current tax rates and rising health care costs would push the debt to almost 200 percent of gross domestic product in 2037. That is under the CBO's scenario that maintains current policies.

Global slump alert as world money contracts

Growth of the world money supply has dropped to the lowest level since the financial crisis of 2008-2009, heralding a severe economic slowdown later this year unless authorites rapidly take action.

Tuition Increases At Oregon Universities

The combination of increased tuition and decreased fees put SOU's overall increase at a more reasonable 4.2%; meaning, on average, an extra 306 dollars for all of next year. OIT sees 5.3% overall increase leading to an extra $419 a year. 5.1% is what Oregon State students face - bumping tuition up $394 - and Oregon sees a 5.9% increase, meaning Ducks will shell out and extra $521 next school year.

Soaring deductibles are the new normal for Fortune 500

Nearly a fifth of the firms responding to the survey, conducted by Towers and the National Business Group on Health, a nonprofit alliance of large companies, said high-deductible coverage would be the only option in 2013. Half of all workers with employer-sponsored health plans — including those working for the government — could be on high-deductible insurance within a decade, according to a new paper from Rand Corp.

Students pay rates as high as credit cards on loans

JPMorgan Chase & Co. (JPM) charges Mirella Tovar as much as 10.25 percent annual interest on her student loans, a rate as high as a credit card. The 24-year-old aspiring graphic designer, the first in her family to go to college, is among millions of former students paying off high-interest loans to private lenders, among them JPMorgan, SLM Corp. (SLM) and Discover Financial Services. In a good month, Tovar earns $730 as a part-time hostess in a pizza parlor, and most of that money goes toward her debt of $98,000.

Japan Lawmakers Push to Curb Central Bank

A growing number of lawmakers are pushing for greater control over the Bank of Japan, just 14 years after the central bank first won its independence, as a strong yen and runaway deficits darken Japan's economic prospects. The moves come as politicians across the spectrum, and many economists, complain that the BOJ isn't acting aggressively enough to combat the country's persistent deflation, while mammoth borrowing limits the scope of fiscal policy to boost growth. Critics say it could lead to a sharp increase in central-bank purchases of government bonds, possibly triggering a European-style rout on Japan's sovereign debt.

Payless paydays for Scranton near as borrowing halted

City of Scranton employees face payless paydays as early as two weeks from now unless the city is able to borrow $16.5 million, funding the city council jeopardized by refusing to make a city parking authority bond payment, Mayor Chris Doherty said Monday.

Mr. Doherty said the money represents 13 paydays, the equivalent of about half a year of pay for employees, in a year when the city has already struggled four or five times to meet payroll. The city already has enough money to make payroll this Friday, but not yet enough for the next payday, June 22, the mayor said. The city has had to rely on advances of state money or state loans to cover the four or five earlier payrolls, he said. He expects tax collections will "probably get us into July sometime," but not through the summer unless money is borrowed.

Portuguese Builders on ’Verge of Collapse,’ Industry Group Says

Portugal’s construction sector is on the “verge of collapse” and in need of an emergency program to help restructure debt, the country’s biggest industry group said.

The construction industry owes banks about 25 billion euros ($31 billion) and insolvency risks are rising as banks cut back on loans, Ricardo Pedrosa Gomes, president of the Public Works and Construction Association said in an e-mailed statement today. The industry needs an emergency program to promote investment and to help cut and restructure debt, according to the statement.

Angry customers confront water district at meeting (Las Vegas Video)

Small business owners and non-profit leaders showed up at a 9 a.m. meeting at the Clark County Government Center to tell the water district that they simply can not afford the huge increase in their water bills. Some customers are seeing increases of almost 300%.

Euro slumps on Spain warning, G7 fails to raise hopes

The euro fell on Tuesday as Spain's treasury minister said high borrowing costs were closing the country off to credit markets and investors received scant comfort from an emergency conference call of Group of Seven finance chiefs.

The euro, which rallied the previous day on euro zone optimism, fell broadly after the G7 ministers did not unveil concrete actions to address problems in Spain and Greece. That disappointed investors hoping for measures. "None of these meetings have produced anything meaningful, and with debt burdens piling up across the globe, I remain highly doubtful that anything substantive will be implemented, and anything that falls short of fiscal union in Europe will allow the crisis to proliferate," said Christopher Vecchio, currency analyst at DailyFX in New York.

Alarm grows in Russia as ruble continues to lose

The Russian ruble yesterday extended the previous week's losses to reach new three year lows as alarm grew over the effects of the euro zone crisis and the falling oil price on the currency.

Prime Minister Dmitry Medvedev on Saturday ordered the central bank to step up interventions as authorities worried that a sharp depreciation could harm economic stability that is the cornerstone of President Vladimir Putin's rule. The pressure on the ruble, the most serious since it came under sustained attack by speculators in the 2008-2009 financial crisis, has been sparked largely by investors fleeing to safe havens due to the euro zone crisis.

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15 Comments

saxplayer00o1's picture
saxplayer00o1
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thatchmo
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More babies....

I've posted articles before from Mark Morford of the San Francisco Chronicle. Hillarious and irreverant.  His assessment of the Spain crisis from his recent visit.  He gets exponential growth and shares it on "mainstream" media.  Aloha, Steve.

http://sfgate.com/cgi-bin/article.cgi?f=/g/a/2012/06/06/notes060612.DTL&nl=fix

 

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Poet
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68th Anniversary of D-Day

I think we should take a moment to commemorate D-Day.

There are many veterans who say that this opening scene depiction was as close to real as it gets:

Link to above YouTube video:

Compared to that, our immediate situation isn't so dire now, is it?

Poet

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D-Day

Spot-on Poet.  I was blessed to have met a chap about 5 yrs ago who served as a pilot in WWII and was shot down over Normandy, and then he flew in Korea, and finally in Vietnam before someone declared him too old!   When we youngsters ask him the How's & Why's of such service, the humble reply we get is that "It's my duty.  Just serving my country." 

His name was Colonel A.T.Pumphreys and he was from Oklahoma and recenlty passed away this past December.    Favorite anecdote comes from an award ceremony I hosted which he attended - and as the organizer I was concerned for his well-being and comfort and his rough & tumble age of 93.  I welcomed him into the conference room and offered him some ice water and to escort him to his seat.

"Sir would you like some water?" I asked as I offered assistance. 

"Ice water?  Where's the beer???"  was his blunt reply.    

 

 

So its that sacrificial spirit that I know will arise to muscle this country thru whatever mess threatens to overtake us.  Call me an optimist I guess.

Cheers,

Dan

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Australia bucks the trend, yet again...

Federal Treasurer Wayne Swan has described the latest economic growth figures as "stunning" and has declared that they should put an end to the "doomsayers".

The National Accounts figures show the Australian economy grew by 1.3 per cent in the March quarter - significantly higher than what economists were predicting.

"What a great day for Australia and what a stunning set of figures," Mr Swan said.

"It says something very special about our people, about our resilience, about our hard work, and about our capacity to face up to the worst that the world can throw at us."

The growth figures were released less than 24 hours after Opposition Leader Tony Abbott described the domestic economic conditions as "soft".

In responding to the Reserve Bank's decision to cut interest rates, Mr Abbott said: "The stock market is down. Profits are weak. Retail sales are weak. The property market is down."

But Mr Swan says it is now time for sections of the business community and the Opposition to stop talking down the Australian economy.

http://www.abc.net.au/news/2012-06-06/gdp-politics/4055948

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Saving Private Ryan

For anyone who has ever been in a fire fight, this was amazingly accurate.  Made me very uncomfortable watching it.  Listen to Regans 1984 speech at Normandy...dang where are the patriots like him, today?

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Doubling time.

Yes DTM, bucking the trend. This is a cognative dissonance moment for me.

I awoke to hear some paid authority telling me that China's growth had fallen, thats right, fallen to 8%.

There is a blind spot in that they never mention the doubling time that a growth rate entails. 8% growth rate implies a doubling time of a tad more than 9 years. Are we to expect then that in 9 years time China will be twice as big as it is now? And in 18 years 4 times etc and so forth.

An unprintable Australian metaphore springs to mind.

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Poet wrote: I think we
Poet wrote:

I think we should take a moment to commemorate D-Day.

There are many veterans who say that this opening scene depiction was as close to real as it gets:

Link to above YouTube video:

Compared to that, our immediate situation isn't so dire now, is it?

Poet

I most definitely agree.  I just read a detailed book on the Normandy landing given to me by my daughter who visited there about a month ago.  I wanted to visit there as well on our recent trip to France but we just didn't have the time.  She said that seeing Omaha Beach first hand and realizing the carnage that went on there, she began to cry.  I know I tear up every time I see Saving Private Ryan.  The WW2 vets were a special breed and I love those old guys, the few who are still remaining.  They gave their all and asked for very little in return.   

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Poet and ao......
ao wrote:
Poet wrote:

I think we should take a moment to commemorate D-Day.

There are many veterans who say that this opening scene depiction was as close to real as it gets:

Link to above YouTube video:

Compared to that, our immediate situation isn't so dire now, is it?

Poet

I most definitely agree.  I just read a detailed book on the Normandy landing given to me by my daughter who visited there about a month ago.  I wanted to visit there as well on our recent trip to France but we just didn't have the time.  She said that seeing Omaha Beach first hand and realizing the carnage that went on there, she began to cry.  I know I tear up every time I see Saving Private Ryan.  The WW2 vets were a special breed and I love those old guys, the few who are still remaining.  They gave their all and asked for very little in return.   

Good call and thanks for remembering.

Now not to get all parochial or anything, but let's not forget that June 6th was also the last day of the Battle of Midway which was the first defeat of the Japanese Imperial Navy in over 350 years and arguably the turning point in the Pacific Theater.  Granted there was some luck catching the Japanese flat-footed while switching their fighter bombers over to contact fuze bombs which resulted in no fighter cover when US dive bombers from YORKTOWN, HORNET and ENTERPRISE showed up. Travlin is our resident WWII PAC Theater expert so he could wax eloquent for days I'm sure.

ao's picture
ao
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more June remembrances
Dogs_In_A_Pile wrote:
ao wrote:
Poet wrote:

I think we should take a moment to commemorate D-Day.

There are many veterans who say that this opening scene depiction was as close to real as it gets:

Link to above YouTube video:

Compared to that, our immediate situation isn't so dire now, is it?

Poet

I most definitely agree.  I just read a detailed book on the Normandy landing given to me by my daughter who visited there about a month ago.  I wanted to visit there as well on our recent trip to France but we just didn't have the time.  She said that seeing Omaha Beach first hand and realizing the carnage that went on there, she began to cry.  I know I tear up every time I see Saving Private Ryan.  The WW2 vets were a special breed and I love those old guys, the few who are still remaining.  They gave their all and asked for very little in return.   

Good call and thanks for remembering.

Now not to get all parochial or anything, but let's not forget that June 6th was also the last day of the Battle of Midway which was the first defeat of the Japanese Imperial Navy in over 350 years and arguably the turning point in the Pacific Theater.  Granted there was some luck catching the Japanese flat-footed while switching their fighter bombers over to contact fuze bombs which resulted in no fighter cover when US dive bombers from YORKTOWN, HORNET and ENTERPRISE showed up. Travlin is our resident WWII PAC Theater expert so he could wax eloquent for days I'm sure.

And since we're honoring the US Army AND the US Navy, let's not forget another war and another branch of the military, the US Marine Corps.  June 6 was the thick of the Battle of Belleau Wood in WW1 when the Marines earned their reputation as "devil dogs". 

"One of the most famous quotations in Marine Corps legend came during the initial step-off for the battle when Gunnery Sergeant Dan Daly, a recipient of two Medals of Honor who had served in the Philippines, Santo Domingo, Haiti, Peking and Vera Cruz prompted his men of the 73rd Machine Gun company forward with the words: "Come on, you sons of bitches, do you want to live forever?""

Semper fi!

 

 

 

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Semper Fi indeed....

The Navy-Marine Corps team remembers its own......

USS DALY (DD 519)  - 8 World War II Battle Stars, 1 Korean War Battle Star.  Veteran of Leyte Gulf, Surigao Strait, Iwo Jima and Okinawa.

Go Navy, Beat Army!

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Howard
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Major General Smedley

Major General Smedley Darlington Butler deserves a mention on this day.

 

Military awards

In addition to the Medal of Honor and his other American military decorations, Butler received several awards from other countries including the Haitian Medal of Honor and the French Order of the Black Star.

2nd award always stands as separate ribbon
Red ribbon with seven white stars: a row of three stars across the center, and rows of two stars above and belowNavy blue ribbon with central gold stripeWidth-44 white ribbon with width-10 scarlet stripes at edges, separated from the white by width-2 ultramarine blue stripes.
Bronze star
Bronze star
Bronze star

Red ribbon with two broad dark yellow stripes

Width-44 yellow ribbon with two width-12 ultramarine blue stripes each distance 4 from the edge Width-44 golden yellow ribbon with width-2 ultramarine blue stripes at the edges Width-44 ultramarine blue ribbon with width-10 Old Glory red stripes 2 units away from the edges
Width-44 red ribbon with width-10 blue stripes 2 units away from the edges Dark blue ribbon with two red stripes close to the center Red ribbon with two dark blue stripes close to the center Width-44 golden yellow ribbon with width-4 emerald green stripes at the edges and a central width-12 ultramarine blue stripe
Rainbow ribbon with violet at the outer edges and going down the spectrum to red in the center Dark blue ribbon with medium-width dark blue, yellow, and orange stripes at each border Dark blue ribbon with a dim outline of a black rosette in the center
1st row Medal of Honor Medal of Honor
2nd row Marine Corps Brevet Medal Navy Distinguished Service Medal Army Distinguished Service Medal
3rd row Marine Corps Expeditionary Medal service stars Spanish Campaign Medal China Relief Expedition Medal Philippine Campaign Medal
4th row Nicaraguan Campaign Medal (1912) Haitian Campaign Medal (1917) Dominican Campaign Medal Mexican Service Medal
5th row World War I Victory Medal  Maltese cross Yangtze Service Medal National Order of Merit, Officer grade Order of the Black Star, Officer grade

Other awards

  • The USS Butler (DD-636), a Gleaves-class destroyer, was named in his honor in 1942. This vessel participated in the European and Pacific theaters of operations during the Second World War. It was later converted to a high speed minesweeper.

 

He single-handedly faught a fascist take over of the United States in 1934 that could've toppled Roosevelts presidency and changed the history of the world.

 

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RE: CBO paints grim long-term debt picture for US

Federal bonded debt is already more than GDP.

Dogs_In_A_Pile's picture
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Last Weekend, Half of Germany Was Running on Solar Power

I'm guessing there was some liberal license taken in coming up with comparative metrics.  Can any of our German CM.commers shed some more light?

German solar power plants produced a world record 22 gigawatts of electricity – equal to 20 nuclear power stations at full capacity – through the midday hours of Friday and Saturday, the head of a renewable energy think tank has said ... Norbert Allnoch, director of the Institute of the Renewable Energy Industry in Muenster, said the 22 gigawatts of solar power fed into the national grid on Saturday met nearly 50% of the nation's midday electricity needs.

 

http://www.treehugger.com/energy-policy/half-germany-was-powered-solar.html

Doomed to fail here in the US since a whole bunch of knothead, skillet licking Congressmen and Senators woudl screw this one up but good.

ao's picture
ao
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German energy production and conservation measures
Dogs_In_A_Pile wrote:

I'm guessing there was some liberal license taken in coming up with comparative metrics.  Can any of our German CM.commers shed some more light?

German solar power plants produced a world record 22 gigawatts of electricity – equal to 20 nuclear power stations at full capacity – through the midday hours of Friday and Saturday, the head of a renewable energy think tank has said ... Norbert Allnoch, director of the Institute of the Renewable Energy Industry in Muenster, said the 22 gigawatts of solar power fed into the national grid on Saturday met nearly 50% of the nation's midday electricity needs.

 

http://www.treehugger.com/energy-policy/half-germany-was-powered-solar.html

Doomed to fail here in the US since a whole bunch of knothead, skillet licking Congressmen and Senators woudl screw this one up but good.

Rick,

As I've written here before, I was stunned by the number of solar cells covering the roofs of houses, barns, storage buildings, businesses, etc.  that we noted in our trip through southern Germany, especially Bavaria.  This is just one example of other things they are doing:

http://www.power-technology.com/projects/bavaria/

In addition, in hotels, you can see various measures for conservation of electricity (LED lights) and water (in the design of toilets and showers).  Many residences have outside window shutters (which pull down from the inside) which have obvious advantages for heat conservation in the winter and keeping sun out in the summer as well as preserving darkness and quiet at night. 

Plus, with regards to cars and fuel mileage, this fellow's experience parallels mine.

http://video.staged.com/localshops/vw_passat_785_mpg_in_the_uk

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