Daily Digest

Daily Digest 9/25 - 1 In 5 NYC Residents Live In Poverty, Americans More Anxious About Economy, China Growth May Be Slowing

Sunday, September 25, 2011, 9:41 AM
  • Five Banks Account For 96% Of The $250 Trillion In Outstanding US Derivative Exposure; Is Morgan Stanley Sitting On An FX Derivative Time Bomb?
  • U.S. Pushes Europe to Act With Force on Debt Crisis
  • One in Five New York City Residents Living in Poverty
  • Narrative Over Numbers
  • China, Driver of World Economy, May Be Slowing
  • New York police arrest Wall Street protesters
  • Midwest Farmers Are on Alert Against Pig Thieves

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Economy

Five Banks Account For 96% Of The $250 Trillion In Outstanding US Derivative Exposure; Is Morgan Stanley Sitting On An FX Derivative Time Bomb? (Phil H.)

At this point the economist PhD readers will scream: "this is total BS - after all you have bilateral netting which eliminates net bank exposure almost entirely." True: that is precisely what the OCC will say too. As the chart below shows, according to the chief regulator of the derivative space in Q2 netting benefits amounted to an almost record 90.8% of gross exposure, so while seemingly massive, those XXX trillion numbers are really quite, quite small... Right?

U.S. Pushes Europe to Act With Force on Debt Crisis (jdargis)

Recognition is growing that Europe’s debt crisis is now perhaps the largest shadow hanging over the global economy. Although trade with Europe represents only a small share of the American economy, Europe’s problems have repeatedly rattled Wall Street over the last year and a half, eroding confidence and deepening fears of businesses and consumers.

One in Five New York City Residents Living in Poverty (jdargis)

Many New Yorkers were spared the worst of the recession, but the median household income has since shriveled to levels last seen in 1980, adjusted for inflation. Household income declined among almost all groups — by 5 percent over all since the beginning of the recession in 2007, to $48,743 in 2010.

Narrative Over Numbers (jdargis)

We now have a daily index for the United States, the Gallup Economic Confidence Index, so we can pinpoint changes in confidence over time. The index dropped sharply between the first week of July and the first week of August—the period when American political leaders worried everyone that they would be unable to raise the federal government's debt ceiling and prevent the United States from defaulting on Aug. 2. The story played out in the news media every day. Aug. 2 came and went, with no default, but, three days later, a Friday, Standard & Poor's lowered its rating on long-term U.S. debt from AAA to AA+. The following Monday, the S&P 500 dropped almost 7 percent.

Apparently, the specter of government deadlock causing a humiliating default suddenly made the United States resemble the European countries that really are teetering on the brink. Europe's story became America's story.

China, Driver of World Economy, May Be Slowing (jdargis)

On the surface, economists at the International Monetary Fund and most banks are still estimating China’s growth rate to be over 9 percent this year. China continues to run very large trade surpluses. New construction starts have soared with a government campaign to provide more affordable housing.

New York police arrest Wall Street protesters (jdargis)

Det. Brian Sessa, a spokesman for the New York Police Department, confirmed arrests had been made but said the NYPD wasn't able to immediately provide the exact number of arrests or say what they were charged with.

Bruner said the bulk of those arrests came around 2:00pm. The group planned a march from Union Square to the UN building. There was no permit for the march. Bruner said near 12th Street and University Avenue a large number of police officers converged on the group and used orange plastic nets to corral protesters who were then arrested.

Midwest Farmers Are on Alert Against Pig Thieves (jdargis)

Some livestock economists pointed to the thefts in this hog-rich region as one more sign of the grim economy, a reflection of record-high prices for hogs this year and the ease of stealing pigs from the large barns that are often far from the farmer’s house.

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."

18 Comments

saxplayer00o1's picture
saxplayer00o1
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Posts: 4066
IMF’s Resources May Not Be Enough If Global Economy Worsens

 

 

"The International Monetary Fund’s $384 billion lending chest may not be enough to meet all loan requests if the global economy worsens, Managing Director Christine Lagarde said.

“The fund’s credibility, and hence effectiveness, rests on its perceived capacity to cope with worst-case scenarios,” Lagarde said in an “action plan” distributed to the IMF steering committee today. The current lending capacity “looks comfortable today but pales in comparison with the potential financing needs of vulnerable countries and crisis bystanders.”"
 

"New York state faces an extraordinary infrastructure problem as it seeks to repair roads and bridges built decades ago.

The state's crumbling infrastructure isn't going to get better any time soon, and it's going to be expensive to repair.
The state Comptroller's Office estimates that New York needs a remarkable $250 billion to maintain its transportation, sewer and water systems over the next 20 years — but about $80 billion of that total is unfunded."

.........................New York struggles to bridge $80 billion chasm for infrastructure needs

 

EPA: N.J. needs $8B fix to antiquated sewer systems

John Steinsvold's picture
John Steinsvold
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Posts: 16
Let's Have a Future Free of Poverty!
An Alternative to Capitalism (if the people knew about it, they would demand it)
 
Several decades ago, Margaret Thatcher claimed: "There is no alternative". She was referring to capitalism. Today, this negative attitude still persists.
 
I would like to offer an alternative to capitalism for the American people to consider. Please click on the following link. It will take you to an essay titled: "Home of the Brave?" which was published by the Athenaeum Library of Philosophy:
 
http://evans-experientialism.freewebspace.com/steinsvold.htm
 
John Steinsvold
 
--Georg C. Lichtenberg

Perhaps in time the so-called dark ages will be thought of as including our own.

RNcarl's picture
RNcarl
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Posts: 382
One tiny little problem with

One tiny little problem with that idea.

It's called human nature.

Humans can be so self-centered ( greedy ) that the idea won't work. Seriously, ask Cuba, the old soviet union, or any other "socialist" "communist" or any other "ist" where "everyone shares"

If it won't work in kindergarten, why would it work with adults?

John Steinsvold wrote:
An Alternative to Capitalism (if the people knew about it, they would demand it)
 
Several decades ago, Margaret Thatcher claimed: "There is no alternative". She was referring to capitalism. Today, this negative attitude still persists.
 
I would like to offer an alternative to capitalism for the American people to consider. Please click on the following link. It will take you to an essay titled: "Home of the Brave?" which was published by the Athenaeum Library of Philosophy:
 
http://evans-experientialism.freewebspace.com/steinsvold.htm
 
John Steinsvold
 
--Georg C. Lichtenberg

Perhaps in time the so-called dark ages will be thought of as including our own.

fogettaboutit's picture
fogettaboutit
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Posts: 12
New York police arrest Wall Street protesters

 I am quite surprised that this website and others outside the mainstream didn't pick up on this story until MSM did (and of course, that was only after there was some violence). For those of you who are unaware - beginning on Sept 17, a loosely knit group with no real leadership began their campaign to occupy Wall Street. https://occupywallst.org/ They were immediately barred from protesting on the The Street but the owner of a private park, Zucotti Park, which is very close to Wall Street, allowed them to set up there. The group has been camping out there since (in the spirit of Tahrir Square) and conducting daily protests and marches calling out Wall Street for its crimes and its role in the collapse/crisis/whatever you want to call it of the world economy. Estimates of the crowd have varied wildly but I can say that I was in NYC last week and visited with the protesters on Sept 18 and 19. The park was pretty well crowded with sleeping bags and makeshift "homes." I would estimate that there were a few hundred hard-core protestors but I believe the numbers would swell during the day. There was some foreign press, a lot of tourists and a police line around the campout. When I was there, I saw no U.S. MSM press. Some of the protest signs were brilliant but due to the unorganized nature of this demonstration, it would be hard for the unaware to understand what the protest was all about. There was a mixture of what appeared to be Libertarian, Anarchist, and Socialist messages. As the weather deteriorates, as it surely will in the next few weeks, I suspect even the hardcore will give up. What a pity that the U.S. mainstream basically decided to ignore this protest when they were all over the first few hundred protesters in Egypt. I believe the demonstrators, mostly young and no doubt unemployed,  in Zucotti Park are brave indeed. 

 

joeysan's picture
joeysan
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alternative to capitalism

 The alternative suggested--a money free economic allocation of resource by interlocking committees would be an utter failure.  It runs contray to the laws of human behavior and opens the doors to political bias and correctness gone wild.  Capitalism's main flaw is incessant government intervention and micro-management to buy votes.  A fair referee version of capitalism wihtout government medling would be a better way to go than an "utopian vision" that may work on a small scale but would be the most corrupt of systems scaled up to hundreds of millions of people.

thc0655's picture
thc0655
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Wall St. occupation

The occupation of Wall St by kids and anarchists is NOT the civil unrest we've been expecting, though when the real civil unrest starts someone will write that OccupyWallSt was the beginning.  When adults start planning and participating then we'll be on to something.

Furthermore, has no one read about Ghandi and MLK?  Is urban camping the best they can do?  There would be so many strategies and tactics which are completely non-violent that would be very effective in disrupting TPTB and drawing the mainstream's attention and support.  And why provoke the Police, unless you make that part of your plan for a very good reason?  But if you're going to purposely provoke use of force by the Police then by all means don't scream like little girls when you get a little pepper spray in your eyes.  "Take it like a man."   http://www.theburningplatform.com/?p=22025 The adults have to get involved so we get something more than the equivalent of temper tantrums.  We need non-violent direct action wisely targeted at the parts and personalities of The System that have created and maintain the macro problems we're suffering from.

This weekend is a time like I experience more and more often in which I feel like that final straw is going to land on some poor camel's back and events will rapidly spiral out of control.  But it passes and I marvel: how much longer can this go on?  One of these days soon, it won't pass...  We've marshalled our resources and remain on high alert.

Thanks for sharing, one and all!

KugsCheese's picture
KugsCheese
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Posts: 1429
RNcarl wrote:If it won't
Quote:

If it won't work in kindergarten, why would it work with adults?

Great quote.   Everthing you need to learn is learned in kindergarten.

Josey's picture
Josey
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Posts: 40
protests/civil unrest/whatever you want to call it

Those "kids and anarchists" have nothing to lose and are the only way this thing wll get started. This is their fight more than anyone else's and they deserve support from the adults, but I wouldn't expect them to trust us, ...about anything.

Pay attention to the cop on the right in the white shirt.

http://www.commondreams.org/headline/2011/09/25

Josey's picture
Josey
Status: Bronze Member (Offline)
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Posts: 40
protests/civil unrest/whatever you want to call it

Those "kids and anarchists" have nothing to lose and are the only way this thing wll get started. This is their fight more than anyone else's and they deserve support from the adults, but I wouldn't expect them to trust us, ...about anything.

Pay attention to the cop on the right in the white shirt.

http://www.commondreams.org/headline/2011/09/25

maizipeng's picture
maizipeng
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BREAKING OUT OF THE VICIOUS CYCLE OF COST

No matter how one looks at the economic woes plaguing America, in essence they are simply costs of all kinds—costs that keep escalating and accelerating at the same time. Rising unemployment, budget deficits, housing foreclosures, rising energy and food prices, unaffordable healthcare, accumulating credit card debt, bailouts, devaluation of the U.S. dollar, outsourcing, global trades, products built with planned obsolescence and obsolete technologies, global warming, natural disasters, depletion of natural resource, nuclear wastes, wars—all these represent costs, either recurring, periodic, catastrophic, or some other types.

http://investmentwatchblog.com/breaking-out-of-the-vicious-cycle-of-cost/

Damnthematrix's picture
Damnthematrix
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Europe Stunned After Being Told "Obama Is Not In Charge

http://www.eutimes.net/2011/09/europe-stunned-after-being-told-obama-is-not-in-charge/

A new report prepared by Russian Deputy Finance MinisterTatyana Nesterenko about the Eurogroup meeting of the Informal Economic and Financial Affairs Council (ECOFIN) in Wroclaw Poland on the growing European debt crisisstates that EU Finance Ministers were “left stunned” Friday after they were told by US Treasury Secretary Timothy Geithner [photo top right] that President Obama was “not in charge.”

According to this report, the “uninvited” US Treasury Secretary showed up at the ECOFIN conference and engaged in what can only be described as a “temper tantrum” where he slammed Europe’s economic policy makers for their intransigence in provided further bailouts to Greece and when queried by European Central Bank (ECB) Chief Jean-Claude Trichet as to if this was “Obama’s position too” was told by Geithner, “He’s (Obama) not in charge, I am.”

The rest is at http://www.eutimes.net/2011/09/europe-stunned-after-being-told-obama-is-not-in-charge/

Damnthematrix's picture
Damnthematrix
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screw the banks
thc0655 wrote:

There would be so many strategies and tactics which are completely non-violent that would be very effective in disrupting TPTB and drawing the mainstream's attention and support. 

ABSOLUTELY.....  Once people realise that the money they "owe" the banks is Monopoly toy money, maybe they'll start a "stop all mortgage and credit card payments" movement.  I'd give TPTB three days before they are screwed.....

Mike

fogettaboutit's picture
fogettaboutit
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Wall St. Occupation

" The occupation of Wall St by kids and anarchists is NOT the civil unrest we've been expecting, though when the real civil unrest starts someone will write that OccupyWallSt was the beginning.  When adults start planning and participating then we'll be on to something."

Wow, that comment sounds just like the other "adult" comment of movements past. 

I do believe it was a sit down strike in a Greensboro diner by students that, in great part, ignited the civil rights movement and that the young people took the lead. The adults did not enter until the young people demonstrated for several years.

I do believe it was young people that first protested the war in Vietnam. It took the adults a while to pick up that ball.

The young have the most skin in this game and that is all the credibility they need.  I am not sure what the "adults" will do - it seems to me a fantasy to actually think the average American (sheepish) adult would actually decide to stop using the bank's credit, stop paying their mortgage (unless of course there's a benefit to doing that) or purposely adopt any other tactic that would damage the power of those who currently hold it. Heck, I don't think most adults in this country even get it. 

 

Damnthematrix's picture
Damnthematrix
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Posts: 3998
Wall St. occupation

Having seen the video at https://occupywallst.org/ I can see there are lts of old farts like me there!

fogettaboutit's picture
fogettaboutit
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 You're right DTM there are

 You're right DTM there are all age groups profiled on that video, including many older folks. This postis really to thc0655 (wondering if that is a 56 year old who likes pot)...we are divided enough by the PTB. Please, let's not divide ourselves further by generations. (Thc 0655) That is what I found so very odious about your previous post.

heffe's picture
heffe
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Posts: 95
Capitalism, human nature, and outdated beliefs
joeysan wrote:

 The alternative suggested--a money free economic allocation of resource by interlocking committees would be an utter failure.  It runs contray to the laws of human behavior and opens the doors to political bias and correctness gone wild.  Capitalism's main flaw is incessant government intervention and micro-management to buy votes.  A fair referee version of capitalism wihtout government medling would be a better way to go than an "utopian vision" that may work on a small scale but would be the most corrupt of systems scaled up to hundreds of millions of people.

What a sad sight to see this type of thinking, lets discuss a few flaws of your assumptions and illogical fallacies.  This also references RnCarl's post which had similar dispositions towards human behavior.

1) Lets define human nature:  a set of behavior's that are evident in every human regardless of locality, ethnicity, or conditioning. With this definition we see that every instinctual bevavior, every genetic predisposition you assume to happen is subject to the conditioning of environment. Self-Preservation? Kamakazee pilots.  Reproduction? Buddhist Monks/Protestant Nun. Greed is not a universally, evenly distributed characteristic of human behavior. In fact, greed may be more opposed to genetic tendencies than empathy, as traits like collaboration and empathy were required for our 500,000+ years of existence in egalitarian, foraging tribal groups. The issue is that greedy, selfish behavior is reinforced and rewarded by our capitalist mindset, which has become more dogma than credible, demonstrative economic models.

2) The claim that 'capitalisms main flaw is incessant government intervention' is a classic non-sequitor, used as a self reinforcing rhetoric to perpetuate the refusal to research and test alternative systems. Religious belief is defined by its inability to consider opposing views, often resorting to labelling them with demeaning terminology and ridicule.  Just as the church labelled anyone opposing their geocentric view as a heretic, anyone opposing the money-centric view of capitalism must be a Stalin supporting communist.  The examples often sighted as evidence for the necessity of capitalism as an ecomonic model are extreme generalizations, forgetting to take into account the various complexities surrounding each societal system.  'Communist' China is extremely capitalist, as was the Soviet Union (I define capitalism as monetary-market economies).  In fact, communism, as originally defined, is a classless, stateless, moneyless society, of which is the oldest known societal system to the human species. Capitalism, as a gaming strategy for motivating production, distribution, and consumption, is the most destructive, wasteful system to have ever existed, and is the reason for our exponential rates of consumption. The necessity of a consumer based economic model requires rampant consumption.  A steady state economy will have to arise sometime, and its foundation will 'require that it doesn't require' consumption and job maintainance for growth.

 

RNcarl's picture
RNcarl
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Posts: 382
fogettaboutit wrote: " The
fogettaboutit wrote:

" The occupation of Wall St by kids and anarchists is NOT the civil unrest we've been expecting, though when the real civil unrest starts someone will write that OccupyWallSt was the beginning.  When adults start planning and participating then we'll be on to something."

Wow, that comment sounds just like the other "adult" comment of movements past. 

I do believe it was a sit down strike in a Greensboro diner by students that, in great part, ignited the civil rights movement and that the young people took the lead. The adults did not enter until the young people demonstrated for several years.

I do believe it was young people that first protested the war in Vietnam. It took the adults a while to pick up that ball.

The young have the most skin in this game and that is all the credibility they need.  I am not sure what the "adults" will do - it seems to me a fantasy to actually think the average American (sheepish) adult would actually decide to stop using the bank's credit, stop paying their mortgage (unless of course there's a benefit to doing that) or purposely adopt any other tactic that would damage the power of those who currently hold it. Heck, I don't think most adults in this country even get it. 

 

Good point, I think a "few years ago" his comments would have been different. I am actually quite shocked that ANY young people have the guts to protest in the USA today. Good for them. At least it was only pepper spray - not diminishing the criminal act of spraying it by the white shirt on already contained young girls who were no threat... To anyone - at least it was not bullets.... Kent State comes to mind. For those not old enough to remember... Google it.

thc0655's picture
thc0655
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Joined: Apr 27 2010
Posts: 1517
Why OccupyWallSt isn't working

We can do better than OccupyWallStreet.  

http://motherjones.com/mojo/2011/09/occupy-wall-street 

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