Daily Digest

Daily Digest 7/28 - What Now For Debt Ceiling, Why Silver Is Set To Explode, Bernie Sanders And The Fed

Thursday, July 28, 2011, 10:41 AM
  • New Jersey's U.S. Attorney's Office looks for volunteer help
  • Debt Ceiling: What Now?
  • California Counties Reel From Tax Hit
  • Eric Sprott on the Silver Take-Down and Why Silver is Set to Explode
  • Katz Worried By Shortfall In Philadelphia Pension Fund
  • The $1 Billion Armageddon Trade Placed Against The United States
  • Bernie Sanders And The Fed
  • Eleven Teams In Air Racing Dike

Crash Course DVDOwn the Crash Course Special Edition Set with Presenter’s Pack (NTSC or PAL)

Economy

New Jersey's U.S. Attorney's Office looks for volunteer help (June C.)

"As people leave, we can't replace them," said Fishman, whose staff typically includes 147 lawyers but is down 10 percent because of a hiring freeze. "We're going to start interviewing people on an ongoing basis and hope to have some on board by mid-fall."

Debt Ceiling: What Now? (Joe P.)

Republicans have a vivid memory of what happened to the first President Bush when he backed away from his 1988 campaign pledge, “Read my lips—no new taxes.” Voters did not give him credit for compromise and for addressing the budget deficit. Instead, he got “credit” for being an unreliable negotiator and one who did not keep campaign promises. That was part of the reason he lost to Bill Clinton in the 1992 presidential campaign.

California Counties Reel From Tax Hit (Phil H.)

Declining home prices are starting to slam California harder than the rest of the nation, in part due to a state law that sets a ceiling—but no floor—on property taxes. Angels Camp, Calif., pictured, is part of Calaveras County, which has seen a big decline in its property-tax rolls in the wake of the housing bust.

The toll is evident here in Calaveras County, a largely rural area about 100 miles east of San Francisco. Over the past three years, it has seen among the biggest property-tax roll declines of any California county, with the total value of taxable properties down about 5% from last year—and 18% over the past three years—to $5.67 billion. Statewide, assessed values declined 1.8% last year from a year earlier, according to state data

Eric Sprott on the Silver Take-Down and Why Silver is Set to Explode (adam)

Jim welcomes Eric Sprott, Founder of Sprott Asset Management back to Financial Sense Newshour and discusses silver manipulation, and why he sees silver as the investment for the next decade.

Katz Worried By Shortfall In Philadelphia Pension Fund (June C.)

"There have to be solutions or [the pension-fund deficit] is going to choke the city," Katz told reporters Tuesday. "When you think that $500 million a year in an operating budget of $3.6 billion goes to pay benefits for services rendered in the past, that's a tough place for a city to be. . . . We're strangling in our own pension juices."

The $1 Billion Armageddon Trade Placed Against The United States (RW)

This had the hallmarks of one of the largest bond shops in the world knowing something the rest of the market didn't.

The number of shops or even central banks that can take on this level of market risk is extremely small. Some that come to mind are hedge fund manager John Paulson, Bill Gross's PIMCO, and the U.S. and Chinese central banks.

Paulson already scored big – about $6 billion big – on a similar trade years ago when he bet against subprime mortgages, the investments that helped bring down Lehman Bros. and many other investors. Whoever was behind it wanted a trade on ASAP, and didn't care about the ripples they would cause.

Bernie Sanders and the Fed (Doug A.)

While the world waits with baited breath on the Contrived Drama of the Debt Ceiling, the real show has already been played out,secretly and behind the scenes. The first audit of the privately owned and foreign owned Federal Reserve by the GAO,has turned up $16 Trillion dollars of loans all over the world to prop up the global fiat empire. This massive money creation is over and above Hank Paulson’s $700 billion dollar heist of the American public. It is also in addition to QE1 and QE2 that resulted in an illusionary recovery of the economy. All of this money printing has done nothing to create any economic growth and it never will. The scary part is that this was done with no oversight or accountability . (Thank God we have someone like Ron Paul to hold these Elite accountable and expose their crimes before the collapse.)

Eleven Teams In Air Racing Dike (R&J)

Eleven teams from different parts of the world have registered for the Racing Aeolus 2011, which will be held on Saturday, August 20th on the Sea Dyke between Lands End and the village of Huisduinen.

An equal amount of vehicles, powered by wind energy, will compete, starting at 11:00 a.m. each other for the title: Who will be first to cross the finish line in a race AGAINST the wind?

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."

20 Comments

saxplayer00o1's picture
saxplayer00o1
Status: Diamond Member (Offline)
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Posts: 4192
Gov't: Health tab to hit $4.6 trillion in 2020

"Italy sold 2.7 billion euros ($3.9 billion) of its 10-year benchmark security, less than the maximum target of 3 billion euros. The debt was priced to yield 5.77 percent, higher than 4.94 percent the last time the securities were sold on June 28."
"Italian 10-year bond yields rose 16 basis points to 5.92 percent as of 10:46 a.m. in London. The 4.75 percent security due September 2021 fell 1.105, or 11.05 euros per 1,000-euro face amount, to 91.83. That pushed the difference in yield, or spread, to 10-year German bonds 19 basis points wider to 330, the most since July 19."

  • Other news, headlines and opinion:

U.S. will pay for half of all health care costs by 2020 and Gov't: Health tab to hit $4.6 trillion in 2020

Roach Says Chinese Officials ‘Appalled’ by Impasse on Raising Debt Ceiling

China's Xinhua Criticizes U.S. Leaders' Actions .

Insurance Cost Against US Default Hits Record

Credible deficit cuts being proposed by US Congress: S&P official

Japan MOF Sakurai: Y10 Trillion May Not Be Enough For Extra Budget

Layoff Notices Top 3,000 As Unions Prepare To Vote (Connecticut)

Trenton Laying Off 108 Police Officers

IMF warns France on deficit and slowing growth

Cost of Treating Veterans Will Rise Long Past Wars

States Count Cash While Hoping Congress Reaches Deal to Raise Debt Limit

Ireland Introduces New Household Tax

HSBC may cut more than 10,000 jobs: report

MERS Bows Out of Foreclosure and Bankruptcy Proceedings

China’s Dagong set for another U.S. downgrade

 

ao's picture
ao
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that odor is familiar

The 1 billion dollar "Armageddon" trade mentioned above has a familiar smell.  Substitute Soros for Kilgore and money for napalm.

.

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Johnny Oxygen
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Re: Eric Sprott on the Silver Take-Down

Great Interview

Thanks for the post Adam.

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Poet
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Posts: 1891
Goldman's New Money Machine: Warehouses

Storing metals in warehouses, charging rent, and limiting outflow severely while allowing unlimited inflows to cause prices on the market to rise much higher... Now where have we seen this before with other commodities?

Special Report: Goldman's New Money Machine: Warehouses
"A string of warehouses in Detroit, most of them operated by Goldman, has stockpiled more than a million tonnes of the industrial metal aluminum, about a quarter of global reported inventories. Simply storing all that metal generates tens of millions of dollars in rental revenues for Goldman every year. There's just one problem: only a trickle of the aluminum is leaving the depots, creating a supply pinch for manufacturers of everything from soft drink cans to aircraft."
http://www.reuters.com/article/2011/07/28/us-lme-warehousing-idUSTRE76R1...

Poet

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jerryr
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$16 Trillion in loans from the Fed??

The first audit of the privately owned and foreign owned Federal Reserve by the GAO,has turned up $16 Trillion dollars of loans all over the world to prop up the global fiat empire.

What the GAO report actually says is that this $16 trillion amount is the running total of all loans made during the financial crisis, but many of these loans were for very short terms, such as overnight.  For example, if a $100 million overnight loan was renewed for 100 days to the same institution, this would count as $10 billion in loans, even though the outstanding amount was never greater than $0.1 billion.

If the loan amounts are adjusted for the term of the loans, the loans were the equivalent of $1.139 trillion over a period of one year.

Here is the link to the GAO report.  Look at pp. 130-133 for the information about the loan amounts. 

http://sanders.senate.gov/imo/media/doc/GAO%20Fed%20Investigation.pdf

saxplayer00o1's picture
saxplayer00o1
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Damnthematrix's picture
Damnthematrix
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There is no debt crisis in

There is no debt crisis in the USA. It is an elaborate PR scare campaign designed to secure re-election funding for Obama in 2012, and to transfer billions from social security programs to the wealthy bankers and corporate robbers of wall street.

'President Obama is relying on substantial campaign contributions from the business community to finance his re-election campaign. Many business people are anxious to see the major government social programs (Social Security, Medicare,
and Medicaid) rolled back. They see the crisis created around the raising of the debt ceiling as a unique opportunity to accomplish this goal.

It also allows Obama to avoid talking about the housing bubble – the real cause of this debt "crisis". This is a topic that he seems anxious to avoid, since many large contributors to his re-election and to the Democratic Party profited enormously from the bubble."

http://www.counterpunch.org/baker07282011.html
http://michael-hudson.com/2011/07/debt-ceiling-for-progressive-repealing/

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rhare
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Progressive blinders?
Damnthematrix wrote:

There is no debt crisis in the USA. It is an elaborate PR scare campaign designed to secure re-election funding for Obama in 2012, and to transfer billions from social security programs to the wealthy bankers and corporate robbers of wall street.

Debt Ceiling Set For  Progressive Repealing wrote:

Of course the government will have enough money to pay the monthly Social Security checks. The Social Security administration has its own savings – in Treasury bills. I realize that lawyers (such as Mr. Obama and indeed most American presidents) rarely understand economics. But this is a legal issue. Mr. Obama certainly must know that Social Security is solvent, with liquid securities to pay for many decades to come.

Mike,

With comments like yours (assuming that's yours) and the one from the article, are you sure you have watched the crash course?  Particularly chapters 12 (Debt) and 13 (A National Failure To Save).  Let's take your comment, the crash course clearly shows that the promises of the social programs can not be met.  They are vastly over promised and underfunded as are most retirement plans.  In addition anyone who even refers to SS as having savings is at best clueless - since they are simply more debt obligations of the federal government.  The SS trust fund is an accounting gimmick used to fund past spending that must be paid with future taxes.

Let looks at part of that comment "Social Security is solvent, with liquid securities to pay for many decades to come.".  Really?  From the SS FAQ:

[quote=Trust Fund FAQ]

By law, income to the trust funds must be invested, on a daily basis, in securities guaranteed as to both principal and interest by the Federal government. All securities held by the trust funds are "special issues" of the United States Treasury. Such securities are available only to the trust funds.

In the past, the trust funds have held marketable Treasury securities, which are available to the general public. Unlike marketable securities, special issues can be redeemed at any time at face value. Marketable securities are subject to the forces of the open market and may suffer a loss, or enjoy a gain, if sold before maturity. Investment in special issues gives the trust funds the same flexibility as holding cash.

So they can't be sold on the market and the government has to redeem them for cash.  Question - where does the government get the cash when they are redeemed?

I think the crash course also shows that while the housing bubble was a big contributor it was simply a symptom of the long term faulty/fragile economic/monetary system.

While I may have many disagreements with you on political viewpoints, I'm trying to understand how you can believe these things and if you don't why you would you post them.  Progressive blinders?

Poet's picture
Poet
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Neo-Conservative Blinders?
rhare wrote:

Progressive blinders?

Y'know, I think that's kinda condescending and a low-level insult. It'd be the same as if someone remarked the opposite to you.

It does an injustice to him and his more complex views.

Poet

Damnthematrix's picture
Damnthematrix
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Posts: 3998
Peak Oil about to bite Australia

http://www.bloomberg.com/news/2011-07-27/shell-to-cease-processing-at-australian-refinery-by-mid-2013-1-.html

Shell to Cease Processing at Australian Refinery by Mid-2013

Royal Dutch Shell Plc (RDSA), Europe’s largest oil company, will halt refining operations at its Clyde plant in Sydney before mid-2013 and convert the facility into a fuel-import terminal.

The refinery, which processes about 79,000 barrels a day, is no longer regionally competitive against Asian “mega- refineries,” the Hague-based company said in an e-mailed statement today. The plan was first mooted in April.

Shell intends to reduce global refining and marketing costs by $1 billion by the end of next year as it seeks to accelerate production growth through 2014, it said in March. The company, which also operates a second refinery at Geelong in Victoria state, acquired Clyde in 1928. The Clyde plant supplies about 40 percent of Sydney’s petroleum needs.

“The decision to convert Clyde into a terminal is consistent with Shell’s strategy to focus its refining portfolio on larger assets and to build a profitable downstream business here in Australia,” Andrew Smith, vice president of the company’s Australian downstream unit, said in the statement.

The plan to end oil refining wasn’t prompted by Australia’s proposed tax on carbon emissions, Shell said.

Damnthematrix's picture
Damnthematrix
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Progressive blinders?
rhare wrote:

Mike,

With comments like yours (assuming that's yours) and the one from the article, are you sure you have watched the crash course?

I've easily watched the CC at least a dozen times, having shown it publicly on more than ten occasions.......  and no, I didn't write that crap, it's from the sources I posted.  I just thought some of you might be interested in what people "out there" are thinking, and no wonder we're in such deep doodoos...

 

Mike

rhare's picture
rhare
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Posts: 1328
If not progressive blinders....
Poet wrote:

Y'know, I think that's kinda condescending and a low-level insult. It'd be the same as if someone remarked the opposite to you.

Your right it was a bit condescending and I didn't really intend it to be that way (maybe a little).  Just wondering how Mike could see any of the stuff in those two articles as reasonable assuming he agrees with the crash course.  The articles were strictly progressive propaganda and not based on reality - IMNSHO.  Anyway, if you were going to say I have blinders on, you would be much more accurate with 'Libertarian blinders' as I'm very far from being a neo-conservative.

At any rate, progressive ideals are one thing, but saying we don't have a debt crisis, and SS trust fund sound because it holds special US treasuries was just a bit too much.  Just curious, did you find those articles reasonable?

[quote=The Weird Battle over the Debt Ceiling]

the Congressional Budget Office (CBO), the country's most respected official forecasting agency,

That is another doozey from one of the articles I find most amusing given CMs latest blog "The Foul Choice Facing Investors"  where he discusses how "silly" and faulty the projections are from the CBO.

I also wonder why Mike gives so much political commentary on the US when he isn't a US citizen.  That also goes a bit against my Libertarian leanings for non-interventionist in other countries affairs.  Of course I do realize that telling others how to live their lives no matter where they live seems to be a progressive/statist ideal - both flavors of progressives - Republican and Democrat (not sure what they are called in Australia).

 

 

rhare's picture
rhare
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Posts: 1328
Glad you haven't lost your mind!
Damnthematrix wrote:

I've easily watched the CC at least a dozen times, having shown it publicly on more than ten occasions....... 

It was actually a rhetorical question, since I assumed you had.

Damnthematrix wrote:

and no, I didn't write that crap, it's from the sources I posted.  I just thought some of you might be interested in what people "out there" are thinking, and no wonder we're in such deep doodoos...

Whheww, I thought you had lost your mind!  You might want to state that your showing these as examples of nutjobs, since the way you posted it, they appear to be your comments and your beliefs.  I do agree we are in deep doodoo because of the inability of most of those debating the debt ceiling to do math.

Sorry if I was too harsh, it's been stressful watching the idiots in DC performing the political theater.  It's time for a vacation away from it all.....

dps's picture
dps
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Posts: 442
Damnthematrix wrote: rhare
Damnthematrix wrote:
rhare wrote:

Mike,

With comments like yours (assuming that's yours) and the one from the article, are you sure you have watched the crash course?

I've easily watched the CC at least a dozen times, having shown it publicly on more than ten occasions.......  and no, I didn't write that crap, it's from the sources I posted.  I just thought some of you might be interested in what people "out there" are thinking, and no wonder we're in such deep doodoos...

 

Mike

 

I'm glad to see the Mike I expect back.  That post was confusing.  hugs ... dons

Poet's picture
Poet
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Posts: 1891
Reasonable?
rhare wrote:

Just curious, did you find those articles reasonable?

If you don't know my stance already, feel free to check out my writings on this site and on my web site that I mentioned a while back.

Poet

Damnthematrix's picture
Damnthematrix
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Posts: 3998
rhare wrote: I also wonder
rhare wrote:

I also wonder why Mike gives so much political commentary on the US when he isn't a US citizen.  That also goes a bit against my Libertarian leanings for non-interventionist in other countries affairs.  Of course I do realize that telling others how to live their lives no matter where they live seems to be a progressive/statist ideal - both flavors of progressives - Republican and Democrat (not sure what they are called in Australia).

 

You call that intervening?  get real.....  I'm simply fascinated by all the crapola going on in your country.  I no longer have opinions on all this garbage, it's simply too late, it will all unravel in its own time....

Mike

SailAway's picture
SailAway
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Posts: 404
IMF warns France on deficit and slowing growth

Isn't there some irony from Christine Largarde now head of the IMF? Just a few weeks ago she was still France finance minister and she's now making comments about the lack of growth over there? Easier indeed to give lessons than addressing the problem...

saxplayer00o1's picture
saxplayer00o1
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Posts: 4192
Today's news and reposting request

 

It would have helped if I would have posted this on the correct day.

Here's today's news.

Poet's picture
Poet
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You Object?
rhare wrote:

I also wonder why Mike gives so much political commentary on the US when he isn't a US citizen.  That also goes a bit against my Libertarian leanings for non-interventionist in other countries affairs.

Hey, if we can discuss Greek bonds and the Euro here, I fully expect Mike to be able to discuss America's debt ceiling debate and National Debt and anything else he wants to discuss. Especially since this site is Ameri-centric.

Besides, what happens here affects him over Down Under, too. I'm really surprised that you would object or even mention your mild distaste, Rhare.

C'mon! If you've got libertarian blinders on, you shouldn't be objecting to his freedom of speech - it doesn't harm you. Mike can't intervene just by talking. And any economic impact his words or his pocketbook might have on the overall outcome is insignificant.

Poet

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Johnny Oxygen
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Posts: 1443
Re: You Object?

Hey, if we can discuss Greek bonds and the Euro here, I fully expect Mike to be able to discuss America's debt ceiling debate and National Debt and anything else he wants to discuss. Especially since this site is Ameri-centric.

+1

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