Daily Digest

Daily Digest 9/14 - Our Defining Moment, Peak Everything, Retiring Later Difficult For Laborers

Tuesday, September 14, 2010, 9:54 AM
  • Our Defining Moment
  • M2 Surges By $30 Billion In Past Week To Highest Ever, Even As Monetary Base Declines
  • Those Who Fail to Plan, Plan to Fail
  • Making The Grade
  • Pennsylvania Speeds Aid to Its Struggling Capital
  • Retiring Later Is Hard Road for Laborers
  • Peak Everything: An Interactive Look At How Much Of Everything Is Left
  • BP And The Gulf Disaster: The Case For The Defence

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Economy

Our Defining Moment (Davos, joemanc)

Embedded in the article is an unspoken assumption that the lower classes need to take pay cuts and layoffs so global bondholders and Chase bankers can be paid in full. That’s so…uh…20th century. If astute bloggers don’t start educating politicians by injecting into the political debate what they clearly know when they engage in market debate, the coming downward mobility for everyone but the bondholders is going to be galactic.

M2 Surges By $30 Billion In Past Week To Highest Ever, Even As Monetary Base Declines (pinecarr)

Is the recent leakage in M2 higher, coupled with a contraction in MB the critical step that all the inflationists have been dreading (yet at the same time expecting)?

Those Who Fail to Plan, Plan to Fail (Ilene)

The IMF also plays on the theme of "thinking ahead" by pointing out that we pretty much have a crisis once every decade so, next time - why not plan for it? The IMF proposes a "precautionary credit line" The Fund’s member countries have asked its staff to explore options for overlapping layers of protection for the global economy as well as working on establishing synergies in terms of lending and surveillance with key regional financing arrangements.

Making The Grade (jdargis)

Microfinance for students presents two specific problems. Micro-entrepreneurs tend to be from families embedded in communities that can exert strong peer pressure to repay. By contrast “students come from remote villages, no one knows them, they have no reputation to lose,” says Mr Hutagt. Student loans are also much longer-term—up to five years—than the one-year maximum of traditional microfinance business loans. This makes them riskier, especially as microlenders generally rely on short-term funding.

    Crash Course DVDJoin us in creating a future of True Prosperity – share the Crash Course today (NTSC or PAL)

Pennsylvania Speeds Aid to Its Struggling Capital (jdargis)

To help the city with its cash flow, the state is fast-tracking payments, which were already in progress, of $1 million for fire protection and $2.6 million for an annual pension fund payment, according to a news release from the governor’s office.

This month, Harrisburg said it did not have the money to make a scheduled bond payment of $3.3 million on Sept. 15. City Council members met in early September to discuss a possible bankruptcy declaration, a rare step for a city.

Retiring Later Is Hard Road for Laborers (jdargis)

After years of debate about how to keep Social Security solvent, the White House has created an 18-member panel to consider changes, including raising the retirement age. Representative John A. Boehner, Republican of Ohio and the House minority leader, has called for raising the age as high as 70 in the next 20 years, and many Democrats have endorsed similar steps, against opposition from some liberal groups. The panel will report by Dec. 1, after the midterm elections.

Energy

Peak Everything: An Interactive Look At How Much Of Everything Is Left (Sean H.)

Generally speaking, regardless of whether one believes in peak oil or not, the facts are that stores of natural resources are disappearing at an increasingly alarming pace. And instead of the world's (formerly) richest country sponsoring R&D and basic science to find alternatives, the US government continues to focus on funding a lost Keynesian cause, debasing the dollar and perpetuating a system that will do nothing to resolve any of these ever more pressing concerns. Furthermore, as by 2020, the US will have around $23 trillion in debt (per CBO estimates), the government will be far too focused on using anywhere between 50-100% of tax revenues to cover just interest expense, than funding science and research.



Then again it is probably only fitting that future generations will be saddled with not just $100 trillion in total sovereign debt, but will be running out of water, will see sea levels rising ever faster, will have no flat screen TVs, and will be using Flintstonemobiles to go from point A to point B.

Environment

BP And The Gulf Disaster: The Case For The Defence (jdargis)

BP’s investigators say the tragedy unfolded in four acts, each containing several errors. In the first, hydrocarbons penetrated the well. In the second, people failed to spot that oil and gas had got in and were rising rapidly. In the third the rig was wrecked by explosions. Finally, the blowout preventer failed to cut off the flow of oil as the rig toppled and its connection to the well below broke open.

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2 Comments

DavidLachman's picture
DavidLachman
Status: Silver Member (Offline)
Joined: Jul 4 2008
Posts: 153
Catch-22: Older retirement age means higher unemployment

"Representative John Boehner, has called for raising the retirement age as high as 70 in the next 20 years"

I'm sure he would like to keep working in Congress that long, but adding 5 years to the retirement age just means 5 more years that the workforce will have to wait for those jobs to become available.  Another catch-22, help fix the retirement system and it worsens the employment system which feeds back to further the government funding problem which hurts the economy which increases unemployment......  Maybe having a Ponzi scheme model for retirement funding is something we should replace instead of trying to fix. 

Poet's picture
Poet
Status: Diamond Member (Offline)
Joined: Jan 21 2009
Posts: 1892
Re: Catch-22: Older retirement age means higher ...
DavidLachman wrote:

"Representative John Boehner, has called for raising the retirement age as high as 70 in the next 20 years"

I'm sure he would like to keep working in Congress that long, but adding 5 years to the retirement age just means 5 more years that the workforce will have to wait for those jobs to become available.  Another catch-22, help fix the retirement system and it worsens the employment system which feeds back to further the government funding problem which hurts the economy which increases unemployment......  Maybe having a Ponzi scheme model for retirement funding is something we should replace instead of trying to fix. 

Considering that the imaginary IOUs in the Social Security "trust fund" can be "cashed in" until the 2030s at full benefits, and even after that is supposed to be able to handle about 80% payouts, this idea of pushing the retirement age to 70 is really a disguised attempt to stave off facing the hard truth: that government has already spent ALL the money and left just IOUs in the "trust fund" file cabinet.

It's the equivalent of me paying you a visit, eating up all the apples in the refrigerator that you had worked hard to pick all afternoon for your evening dinner, promising to pay you back later when in reality I'll be gone and safely out of your reach, and proposing that you defer your apple eating apples to breakfast-time instead while suggesting that you go pick a few more apples in the meantime.

There are other issues, of course. Americans are already poor savers in general, so even with Social Security, many may still have to work to 70 anyway. At the same time, many are taking Social Security at 62 instead of 67 or 70 - either because they can't find a job or they're comfortable enough to live on reduced benefits. Longer life expectancies battle against rampant obesity. Will retiring workers allow younger ones to get into the work force? More likely those jobs will be outsourced, outdated, or the replacement workers be earning far less (it's already happening for Ford union workers and new teachers, etc.). But the biggest issue of all is that there's no money and the retirement-at-70 idea is really an attempt by politicians to kick the can further down the road.

Poet

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