Daily Digest

Daily Digest - April 28

Wednesday, April 28, 2010, 9:36 AM
  • Obama Urges Bipartisan Effort On Soaring Deficits
  • Moody’s, S&P Lose Bid to Dismiss Rhinebridge Suit
  • ECB May Have To Turn To 'Nuclear Option' To Prevent Southern European Debt Collapse
  • ECB's Trichet: 'Presently Activating' Greek Debt Aid Talks
  • IMF Warns Greeks Face 'Untenable Situation' Without Bailout
  • Harrisburg City Council To Consider Guidelines For Sale Of City Assets
  • Viniar Says Firm Didn’t Negotiate With Treasury on AIG Payments
  • Weak Italian Bond Auction Spurs Greek Contagion Fears
  • Spain’s Debt Rose 33.9% in 2009
  • Portugal, Greece Downgrades Risk Sovereign Debt Crisis, AXA Says
  • NYC Seeks $300 Levy On Once-Free Film Permits
  • Pound Weakens Against Yen, Dollar on Election Deadlock Concern
  • Greece Bondholders May Lose $265 Billion as S&P Sees 70% Loss
  • Stocks Plummet as Market Wakes Up to "Real Crisis," Says Peter Schiff
  • Greek Junk Contagion Presses EU to Broaden Bailout After Rout
  • Asia Bond Risk Surges to Two-Month High After Greece Downgrade
  • California Declares War on State Bond Short-Sellers: Joe Mysak
  • Paterson Presses To Delay Tax Credits, Furlough 100K Workers (New York)
  • Council will delay $1M BOPU payment (Cheyenne)
  • Treasuries Fall as U.S. Prepares $42 Billion Five-Year Auction
  • Puru Saxena China & Peak Oil

Economy

Obama Urges Bipartisan Effort On Soaring Deficits

President Barack Obama said Tuesday Washington must urgently confront unpleasant truths about deficits, while the Federal Reserve chairman said failure to mop up red-ink spending would "ultimately do great damage" to the country. Obama refused to rule out measures that would fight "exploding deficits." This signaled that politically toxic tax increases were options that could be under consideration by members of a panel he tasked with reducing federal deficits that threaten to erode Americans' standard of living.

Moody’s, S&P Lose Bid to Dismiss Rhinebridge Suit

Moody’s Corp. and McGraw-Hill Cos.’ Standard & Poor’s unit lost a bid to dismiss a lawsuit claiming the two rating companies misled investors in a structured investment vehicle known as Rhinebridge..... “The risk that caused plaintiffs’ losses -- that Rhinebridge consisted of toxic assets that would become worthless -- was precisely within the zone of risk concealed by the top ratings” given by the ratings companies, the judge said in a 29-page opinion issued yesterday in New York.

ECB May Have To Turn To 'Nuclear Option' To Prevent Southern European Debt Collapse

The European Central Bank may soon have to invoke emergency powers to prevent the disintegration of Southern European bond markets, with ominous signs of investor flight from Spain and Italy.... Mr Cailloux said the ECB should resort to its “nuclear option” of intervening directly in the markets to purchase government bonds. This is prohibited in normal times under the EU Treaties but the bank can buy a wide range of assets under its “structural operations” mandate in times of systemic crisis, theoretically in unlimited quantities.

ECB's Trichet: 'Presently Activating' Greek Debt Aid Talks

Trichet said earlier in the day that default of an E.U. nation's sovereign debt was "out of the question." However, credit default swap spreads for Greece expanded to record wide levels on Tuesday, reflecting soaring costs for insuring Greek debt against default. Credit default swap spreads also widened significantly Tuesday for Portugal and Italy.

IMF Warns Greeks Face 'Untenable Situation' Without Bailout

The head of the International Monetary Fund warned Tuesday that Greece faces an "untenable situation" if it does not get help to remain solvent, according to the French daily La Tribune. "If we do not help them, they are going to be in an untenable situation," IMF managing director Dominique Strauss-Kahn said in an interview posted on the paper's website and due to appear in Wednesday's edition.

Harrisburg City Council To Consider Guidelines For Sale Of City Assets

One day after Harrisburg City Council members held a special hearing on bankruptcy, the council will decide tonight on one of two resolutions that aim to set guidelines for carrying out the sale or lease of city assets. Each proposal paves the way for greater transparency in the resolution of its $288 million debt.

Viniar Says Firm Didn’t Negotiate With Treasury on AIG Payments

Goldman Sachs Group Inc. received a 100 percent payout on its collateral from American International Group Inc. because “it was what they owed us,” Chief Financial Officer David Viniar said. Viniar, who spoke today at a Permanent Subcommittee on Investigations hearing in Washington, said there was no negotiation with the U.S. Treasury Department over the payout. Viniar said Goldman Sachs received about $12.9 billion in 2008 related to securities-lending and credit-default swap contracts with AIG.

Weak Italian Bond Auction Spurs Greek Contagion Fears

Italy sold EUR9.5 billion in six-month Treasury bills Tuesday. But the Treasury received only EUR9.78 billion in bids, offering a razor-thin margin compared with previous debt sales. Moreover, the average yield jumped to 0.814%, much higher than analysts expected and far above the 0.567% yield offered at last month's auction of the same paper. Italy's coming auction of up to EUR8 billion in three types of government bonds Thursday will now be closely scrutinized for further signs of contagion.

Spain’s Debt Rose 33.9% in 2009

Spain’s outstanding government debt totaled 461.99 billion euros ($619 billion) at the end of 2009, rising 33.9 percent from the level at the end of the previous year due to measures taken to deal with the recession, central bank figures released Monday show. The sharp rise in public debt was a result of programs created to stimulate the economy and deal with the severe recession, the Banco de España said.

Portugal, Greece Downgrades Risk Sovereign Debt Crisis, AXA Says

Greece and Portugal’s downgrades threaten to ignite a sovereign debt crisis throughout the euro region, according to Axel Botte, a strategist at AXA Investment Managers in Paris. “The biggest risk now is that the market speculates against every single indebted peripheral country, and that could lead to a sovereign debt crisis,” Botte said in an interview. “The contagion risk is real. It’s much easier to bail out a bank than to bail out a country.”

NYC Seeks $300 Levy On Once-Free Film Permits

For the first time ever, television and film productions that shoot in New York City will have to pay for permits that have always been free. Mayor Michael Bloomberg's administration is blaming budget woes. Senior Bloomberg administration officials on Tuesday told representatives from Hollywood studios, advertising and labor unions about the proposal. The fee would apply to films, commercials, music videos and television series shot in New York, such as the CBS drama "The Good Wife."

Pound Weakens Against Yen, Dollar on Election Deadlock Concern

The pound fell on growing evidence next week’s U.K. election will produce a government without the parliamentary support needed to trim a budget deficit that is the biggest among the Group of Seven nations..... Rising Deficit The deficit jumped 76 percent in the year through March to 152.8 billion pounds, the largest since World War II, the Office for National Statistics has said. In March, it was 23.5 billion pounds, the most for any month since records began in 1993.

Greece Bondholders May Lose $265 Billion as S&P Sees 70% Loss

Holders of Greek bonds may lose as much as 200 billion euros ($265 billion) should the government default, according to Standard & Poor’s. The ratings firm cut Greece three steps yesterday to BB+, or below investment grade, and said bondholders may recover only 30 percent and 50 percent for their investments if the nation fails to make debt payments.

Stocks Plummet as Market Wakes Up to "Real Crisis," Says Peter Schiff (Video)

"A lot of people were confused – they thought the market going up was somehow ratifying what the government had done – that the stimulus and bailouts were good and the economy was improving – it's not," Schiff says. "The economy is in worse shape than in 2008." Rather than resolved the crisis, all we've done is papered over problems in the banking system with "phony accounting" and "dug ourselves deeper into debt," says Schiff, a longtime deficit hawk.

Greek Junk Contagion Presses EU to Broaden Bailout After Rout

Europe’s worsening debt crisis is intensifying pressure on policy makers to widen a bailout package beyond Greece after a cut in the nation’s rating to junk drove up borrowing costs from Italy to Portugal and Ireland. As German Chancellor Angela Merkel delays approval of a 45 billion-euro ($59 billion) Greek rescue, the crisis is spreading. Portugal’s benchmark stock index yesterday fell the most since the aftermath of Lehman Brothers Holdings Inc.’s collapse, while the extra yield that investors demand to hold Italian and Irish debt over bunds rose to a 10-month high.

Asia Bond Risk Surges to Two-Month High After Greece Downgrade

The cost of protecting Asian bonds from default surged to the highest in two months after Standard & Poor’s downgraded Greece’s credit rating to junk. The Markit iTraxx Asia index of credit-default swaps on 50 investment-grade borrowers outside Japan jumped 10 basis points to 110.5 basis points as of 7:50 a.m. in Singapore, its highest since Feb. 26, according to Deutsche Bank AG and CMA DataVision in New York. “Markets hate uncertainty and the Greek situation has brought uncertainty back in full force,” said Jason Watts, head of credit trading at National Australia Bank Ltd. in Sydney. “The sovereign risk spreading through Europe is having a global impact and Asia-Pacific benchmarks are paying the price.”

California Declares War on State Bond Short-Sellers: Joe Mysak

California wants to know why underwriters take its money to sell the state’s bonds, and then talk trash behind its back. That’s what California Treasurer Bill Lockyer asked in March of six banks that have made $215 million from selling the state’s general obligation bonds since 2007. “We have information that indicates your firm, which sells California GO bonds, may participate in the municipal credit default swaps market,” the letter said. Lockyer wanted to know why, and to what extent. The treasurer posted the banks’ responses on his Web site last week.

Paterson presses to delay tax credits, furlough 100K workers (New York)

New York Gov. David Paterson wants to delay payment of business tax credits and furlough 100,000 state workers, he said on Tuesday. In addition, Paterson is demanding a vote on his budget proposal on Wednesday, before legislators leave town as scheduled. “This crisis is worsening,” Paterson said on Tuesday. “Pass my budget tomorrow, in an up or down vote. Time is of the essence.” Budget talks are barely plodding along, and they’re becoming uglier by the day. The state faces a $9.2 billion deficit, and the state budget is now nearly a month late.

Council will delay $1M BOPU payment (Cheyenne)

Strapped for cash, the city will delay paying a $1 million water bill of sorts for two years. The Cheyenne City Council voted 5-4 in favor of delaying its share of a payment for a 1980s expansion of the city's water system until December 2012. Mayor Rick Kaysen emphasized before the vote this was an extension, "not a forgiveness," and was no different than extending a loan payment or refinancing to keep mortgage payers in their homes. "The city will meet its obligation," Kaysen said.

Treasuries Fall as U.S. Prepares $42 Billion Five-Year Auction

Treasuries fell on speculation yesterday’s biggest rally this year will curtail demand when the U.S. sells $42 billion of five-year notes today. Ten-year yields climbed from near a five-week low, after plunging yesterday when Greece had its debt rating cut to junk and borrowing costs rose in Italy, Portugal and Ireland. The U.S. is also scheduled to sell seven-year notes tomorrow, the last of four sales this week totaling a record $129 billion.

Energy

Puru Saxena China & Peak Oil (Video, via britinbe)

CNBC interview with Puru Saxena (CEO of Puru Saxena Wealth Management) on 26th April, 2010 regarding "China & Peak Oil".

32 Comments

saxplayer00o1's picture
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Re: Daily Digest - April 28

"LISBON — The Portuguese government angrily denounced an "attack from the markets" after its credit rating was downgraded and rejected any comparison to the debt crisis in Greece.

"It is a decisive moment. The country must respond to this attack from the markets," Finance Minister Fernando Teixeira dos Santos said in a statement on Tuesday."

"The price of insuring Greece's debt against default soared to the highest rate in 14 years today as the country's securities regulator banned short-selling in Greek shares to halt a crisis of confidence."

"April 28 (Bloomberg) -- The Czech government is delaying a sale of international bonds after credit-rating downgrades in Greece and Portugal fuelled concern about European sovereign debt, driving investors from assets in emerging markets.

“We are waiting for better conditions” on the market before selling the euro-denominated bonds, Deputy Finance Minister Ivan Fuksa said in an interview in Prague today. "

"SPRINGFIELD - The Teachers' Retirement System is asking lawmakers to reject Gov. Pat Quinn's idea of giving billions worth of IOUs rather than cash to the pension funds in an effort to balance the state budget.

The plan Quinn's administration asked the pension systems to consider would set aside a 1995 law that made pension payments a budget priority, lower next year's required payment by hundreds of millions of dollars and give the systems an IOU.

Retirement system trustees said the effects would be "devastating" on the teachers' pension fund, one struggling from years of underfunding and recent market downturns and is only 15 years into a 50-year plan for financial stability."

"The state's five public employee pension funds are currently carrying a $78 billion deficit and are owed $3.7 billion in the next budget year, which begins July 1. The teachers' pension system is budgeted for nearly $2.36 billion. The system trustees said Quinn's plan seeks to lower that amount to $2.17 billion, a $189 million decrease.

Quinn and lawmakers are trying to find a way to balance a $13 billion budget deficit at a time when there's no support for tax increase and little backing for deep cuts. Last year, they borrowed $3.5 billion to make pension payments. "

"April 28 (Bloomberg) -- Hungary’s forint posted its biggest two-day drop in more than a year and the cost of protecting against a national default jumped on the new ruling party’s call for the central bank president to quit and on credit downgrades for Greece and Portugal.

The forint weakened as much 1.3 percent against the euro, bringing the two-day intraday loss to 3.6 percent, the biggest since March 30, 2009. "

""Lloyd Blankfein has admitted that he believes Goldman Sachs has no moral obligation to tell clients it is betting against a product it is asking them to buy."

The stark admission – made by the bank's chairman at the end of a more than nine-hour marathon hearing before the US Senate – came in spite of his assertion that "I think people trust us" as he tried to fend off accusations that Goldman inflated the US housing bubble.

Senator Carl Levin told the veteran banker that he "wouldn't trust" Goldman as he repeatedly asked whether the bank would disclose its position "when they're buying something you solicit them to buy, and then you're taking a position against them?"

"I don't believe there is any obligation" to tell investors, Mr Blankfein responded. "I don't think we'd have to tell them, I don't think we'd even know ourselves." "

"April 28 (Bloomberg) -- Bonds sold by Greek and Portuguese companies lost the most since at least 2008 as concerns about sovereign defaults start to contaminate the corporate sector.

Greek corporate debt in all currencies has lost 3.99 percent this month, the worst-performing securities in Bank of America Merrill Lynch’s Global Broad Marker Corporate index. Portuguese company notes gave up 1.93 percent, their worst showing since October 2008, a month after Lehman Brothers Holdings Inc. filed for bankruptcy."

"April 28 (Bloomberg) -- The cost of insuring against default on European bank bonds surged on concern the global financial system will be hurt by a “domino effect” triggered by downgrades of Greek lenders to junk status.

The cuts “will force the Greek banks to post a higher amount of collateral, forcing them into a liquidity trap and that could spread the contagion globally through the financial system -- a domino effect,” London-based analysts at BNP Paribas SA wrote in a note to investors."

"LONDON (MarketWatch) -- The cost of insuring Greek and Portuguese government debt against default continued to soar Wednesday amid the deepening euro-zone debt crisis. The spread on five-year Greek credit default swaps widened to 871.5 basis points from 824 basis points late Tuesday, according to CMA DataVision. That means it would now cost an unprecedented $871,500 a year to insure $10 million of Greek government debt against default for five years. The Portuguese five-year CDS spread rose to a record 421 basis points from a close Tuesday of 386 basis points."

"April 28 (Bloomberg) -- Japan’s bond sales may exceed estimates by the Finance Ministry if the Democratic Party of Japan-led government keeps last year’s campaign promises, a DPJ study group said.

The gap between revenue and spending may swell 29 percent to 57.3 trillion yen ($615 billion) in the year starting April 2011, according to estimates by the group, indicating bond issuances of that amount. The Finance Ministry in February forecast a revenue shortfall of 51.3 trillion yen for the year."

  • Other news and headlines:

Beyonce Knowles Gets $425,000 Taxpayer Bailout On Her House In Texas

City officials facing $25 million hole in budget (New Orleans)

City's budget woes will mean more potholes (Los Angeles)

gregroberts's picture
gregroberts
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Re: Daily Digest - April 28

Vote Trackers are people from every state
who are tracking and charting
the voting records of their federal politicians
and spreading these charts throughout the states.

Voters use them when deciding who to vote out
in the State Primaries and November elections.

http://www.votetrackers.com/

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Re: Daily Digest - April 28

Roubini on Greece

Apr 27, 2010 22:14 EDT

Nouriel Roubini, it can be safely said, gives good panel — especially when the subject is the eurozone and the possible disintegration thereof. He’s been bearish on the PIGS in general and on Italy in particular for many years now, but I don’t think it comes as much surprise to him or to anybody else that Greece is the first country really in the firing line.

One of the most interesting things about the status quo post-downgrade is that no one seems to have a clue what the base-case scenario is. Are the markets still expecting Greece to get bailed out, but adding on an ever-increasing yield premium to account for the possibility that it won’t be? Are they, like panelist James McCaughan, expecting an orderly debt restructuring later this year, with an effective haircut in the 20-40% range? They certainly don’t seem to be expecting anything worse than that — Greece’s bonds are trading at high yields, yes, but not at distressed levels, and there’s still room to lose a lot of money on those 2-year bonds if they end up defaulting.

My feeling is that the base case is one of muddling through for the next 2-3 years, with Greece scrounging up enough money from the EU and IMF to avoid a default, and Europe’s banks meanwhile staying profitable enough thanks to the ECB’s monetary policy that they build up their solvency for when the inevitable default does occur a few years down the road.

http://blogs.reuters.com/felix-salmon/2010/04/28/roubini-on-greece/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+felix-all+%28Felix+Salmon+-+All%29

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Re: Daily Digest - April 28

Let's see if I got this straight.  Obama urges bipartisan effort to deal with deficit, after his party created the problem, and controls the level of spending completely.

Take the credit.  Spread the blame.  Got it. 

 

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Re: Daily Digest - April 28

uh-oh....

Spain's Long-Term Debt Rating Is Downgraded by S&P (story developing)

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Re: Daily Digest - April 28

Obama Urges Bipartisan Effort On Soaring Deficits

actually, since it took  years of "bipartisan effort"  to get to this pathetic financial state, why should we trust either party to fix it? 

idoctor's picture
idoctor
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Re: Daily Digest - April 28

why should we trust either party to fix it?

Good point. IMHO it is past the point of being fixable. Now we have to learn to live with it or should I say survive in it. What a mess all this debt for the world is becoming. Throw in a pinch of peak oil & what a toxic mix.

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Re: Daily Digest - April 28

Gordon T. Long is pretty much nailing it...

http://lcmgroupe.home.comcast.net/~lcmgroupe/2010/Tipping_Points-2010-Ma...

The Blob that took over Louisiana...

http://www.businessinsider.com/map-of-the-day-oil-louisiana-2010-4

WTF.... from Victory gardens to this?

http://foodfreedom.wordpress.com/2010/04/24/s-510-is-hissing-in-the-gras...

 

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Re: Daily Digest - April 28

 http://www.cnbc.com/id/36822959

Treasury Auctions 5-Year Bonds at High Yield of 2.54%

 The Treasury auctioned $42 billion of five-year notes on Wednesday at a high yield of 2.54 percent and a bid to cover ratio of 2.75, a key indicator of demand.

 

Long-dated Treasurys fell further after the auction, reaching a session low. Investors also were awaiting a policy statement from the Federal Reserve at 2:15 pm.

The benchmark 10-year note, was down 14/32 half an hour before the bidding deadline for the notes, was down 17/32 after the auction.

Its yield, which moves inversely to price, was 3.75 percent, up 6 basis points from late Tuesday.

A steadying of Wall Street stocks after Tuesday's sell-off also reduced safety bids for bonds, even though acute nervousness lingered over Europe's fiscal woes in the wake of rating downgrades of Greece, Portugal and now Spain.

Investor demand for this week's record $129 billion in coupon-bearing securities sales in the United States has been mixed so far.

 

Bond Yields
4.6033
0.0243
+0.53%
0
3.7358
0.0428
+1.16%
0
2.4794
0.0544
+2.24%
0
1.0277
0.0647
+6.72%
0
0.2436
-0.0004
-0.16%
0
0.1572
0.0052
+3.42%
0

 

Tuesday's rally, with the five-year yield posting its biggest single-day drop in more than a year, may curb appetite for these pricier bonds.

"You are losing some safety bids and you are trying to take down supply at pretty steamy levels," said Russ Certo, co-head of the rates group with BroadPoint Gleacher in New York.

Certo and bond analysts said short-covering was behind the bulk of Tuesday's rally, which has since faded.

While traders and analysts widely expect the Federal Open Market Committee, the Fed's policy-setting group, will holdshort-term interest rates near zero.

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Re: Daily Digest - April 28
printfaster wrote:

Let's see if I got this straight.  Obama urges bipartisan effort to deal with deficit, after his party created the problem, and controls the level of spending completely.

Take the credit.  Spread the blame.  Got it. 

 

Makes sense to me.  He did not need help in spending it, but paying the bill is a different matter.  The Dems are pretty good at spending money.  They now are scratching their heads trying to figure out who they can send the bill to.

Tim

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Re: Daily Digest - April 28
printfaster wrote:

Let's see if I got this straight.  Obama urges bipartisan effort to deal with deficit, after his party created the problem, and controls the level of spending completely.

Take the credit.  Spread the blame.  Got it. 

 

Just to set the record straight, at least 8 Tr of the current 12 Tr Federal debt was run up under Republican administrations.  The last Democrat was the only president since before Reagan to actually make headway on cutting the debt.  That said, it is always a bipartisan effort to run up debt and bipartisan blaming when the debt comes back to bite us.  A pox on all their houses.

Doug

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printfaster
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Re: Daily Digest - April 28

Just to set the record straight, at least 8 Tr of the current 12 Tr Federal debt was run up under Republican administrations

Got it.  Bush did it, so there is no need to be  responsible for anything.  You also forget that the last two years of the Bush administration the Democrats were in charge of all spending, including TARP, and they were the ones that approved of Paulson after Bush tried to have a treasury secretary not under control of Goldman.

Now for

The last Democrat was the only president since before Reagan to actually make headway on cutting the debt

That was largely done by shortening the yield curve and riding on taxation of the internet bubble stock gains.  When Clinton finally departed, Treasury quit issuing 30s or anything longer than 10, and the bubble was over.

 

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Re: Daily Digest - April 28

 

Trying to solve human problems with the same kind of mind that caused them is like asking a destructive tornado to rebuild the town it has just destroyed.  Vernon Howard - 1500 Ways to Excape the Human Jungle

 

 

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Re: Daily Digest - April 28
Doug wrote:

Just to set the record straight, at least 8 Tr of the current 12 Tr Federal debt was run up under Republican administrations.  The last Democrat was the only president since before Reagan to actually make headway on cutting the debt.  That said, it is always a bipartisan effort to run up debt and bipartisan blaming when the debt comes back to bite us.  A pox on all their houses.

Doug

That last Democrat also used the Social Security surplus to balance the budget too. This one would be doing the same, except there is now a deficit in Social Insecurity.

Bush will have doubled the debt in his 8 years, and Obama is on track to do the same in his, gulp, 8 years. The Demopublicans strike again!

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Re: Daily Digest - April 28

Just to set the record straight, at least 8 Tr of the current 12 Tr Federal debt was run up under Republican administrations

Got it.  Bush did it, so there is no need to be  responsible for anything.  You also forget that the last two years of the Bush administration the Democrats were in charge of all spending, including TARP, and they were the ones that approved of Paulson after Bush tried to have a treasury secretary not under control of Goldman.

Now for

The last Democrat was the only president since before Reagan to actually make headway on cutting the debt

That was largely done by shortening the yield curve and riding on taxation of the internet bubble stock gains.  When Clinton finally departed, Treasury quit issuing 30s or anything longer than 10, and the bubble was over.

 

 

Politics is just the smokescreen used to gett the people to argue amongst themselves. By blaming one party or the other you are just being led by the nose. It really does not matter which party is in control of any part of our government. They all make choices based on what is best for large corporations, lobbying groups and the top 2%, not what is best for the citizens.

If you really believe one party is better than the other you have not done your homework.

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Re: Daily Digest - April 28

With all that we've learned here from Chris and others, are we still naive enough to believe in the Democrats & Republicans?

There's enough blame to be spread around.

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Re: Daily Digest - April 28

That Puru Saxena video was unbelievable.  The fundamentals of "Peak Oil" raw, naked and on CNBC, how did that happen?  I also agree with The Black Death; debating the Right vs. Left, Red vs. Blue is a smoke screen, a Red Herring, it is a waste of time.  They are controlled by the same people. They are not where the real decisions are made. 

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Re: Daily Digest - April 28
Nacci wrote:

 I also agree with The Black Death; debating the Right vs. Left, Red vs. Blue is a smoke screen, a Red Herring, it is a waste of time.  

Concur.  As Dr. Chris said at the New Paltz seminar (I'm paraphrasing):  forget about Left & Right.  Think Smart vs. Stupid, Right vs. Wrong, Truth vs. Lies (or Weasels).

Viva -- Sager

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Re: Daily Digest - April 28
SagerXX wrote:
Nacci wrote:

 I also agree with The Black Death; debating the Right vs. Left, Red vs. Blue is a smoke screen, a Red Herring, it is a waste of time.  

Concur.

Me too.....  and EXACTLY the same thing happens in Australia... 

On a different topic, check this out:

Oil spill to be set on fire to save coast

By North America correspondent Kim Landers

http://www.abc.net.au/news/stories/2010/04/29/2885404.htm?section=justin

Crews are poised to set fire to some of the oil slick caused by a leak from the site of an oil rig which exploded and sank last week in the Gulf of Mexico.

The technique is being used to try to reduce the amount of oil that can reach the Louisiana coast.

Vessels are sweeping some of the thickest oil into a remote area where it will be ignited and burned in a controlled manner.

BP's chief operating officer, Doug Suttles, says that may help protect environmentally sensitive areas of the coast.

"We fully expect we'll have a burn today and then hopefully be able to report the results tomorrow," he said.

The slick has spread to about 30 kilometres east of the mouth of the Mississippi River in Louisiana.

The oil is leaking from the well at a rate of 160,000 litres a day and the Coast Guard is warning this could end up being one of the worst spills in US history.

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Re: Daily Digest - April 28
Doug wrote:

Just to set the record straight, at least 8 Tr of the current 12 Tr Federal debt was run up under Republican administrations.  The last Democrat was the only president since before Reagan to actually make headway on cutting the debt.  That said, it is always a bipartisan effort to run up debt and bipartisan blaming when the debt comes back to bite us.  A pox on all their houses.

Doug

Doug,

In the interest of accuracy, what you've said is not quite right. There was some progress under Clinton on the cash-basis deficit.  The accrual-basis deficit, however, is another matter entirely and that spiraled out of control under Clinton just as it did before and after him.

The debt, however, has always and ever, without interruption, grown larger under every adminstration since Reagan including Clinton.  This is easily verified by checking the "debt to the penny" figures at the Treasury site.

Debt and deficit are important to distiguish from one another, and knowing the tricks that are employed to obscure and hide the true nature of the deficit is important as well.  There is a form of mythology out there that persists which routinely translates into "Clinton cut the debt" but this is clearly and provably not true.

Best,

Chris M.

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Re: Daily Digest - April 28

http://business.timesonline.co.uk/tol/business/economics/article7111123.ece

Spain hit as Greek 'illness' spreads over Europe

The crisis affecting the eurozone worsened yesterday when Spain’s credit rating was downgraded less than 24 hours after Greece was sent into financial meltdown.

Fear of contagion gripped Europe’s financial markets when the debt rating agency Standard & Poor’s cut the rating on Spain’s sovereign bonds. The decision — coming after the agency downgraded Portugal’s rating and cast Greek bonds into the scrapyard, designating them junk — sent the euro plunging against the dollar.

The risk that weak eurozone economies might be infected by a Greek financial virus added pressure to an emergency meeting in Berlin, where the heads of the International Monetary Fund and the European Central Bank considered a proposal to triple the size of a bailout for Greece.

After a meeting yesterday with Dominique Strauss-Kahn, the IMF chief, and Jean-Claude Trichet, head of the central bank, German MPs said that Greece would need €120 billion over three years. That would almost triple the size of the bailout fund agreed in principle by the eurozone states and IMF under which the member states would contribute €30
billion and the IMF €15 billion.

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Holy Cow, UST Is Taking Online Donations To Pay Down the Debt

Unbelievable...

Quote:

As far as we know, this is nothing new, still it's pretty remarkable. The Treasury is taking online donations to pay down the debt.

http://www.businessinsider.com/holy-cow-the-treasury-is-taking-online-do...

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Davos
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Re: Holy Cow, UST Is Taking Online Donations To Pay Down ...
joemanc wrote:

Unbelievable...

Quote:

As far as we know, this is nothing new, still it's pretty remarkable. The Treasury is taking online donations to pay down the debt.

http://www.businessinsider.com/holy-cow-the-treasury-is-taking-online-do...

Pretty remarkable - un-flipping believable! 

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Re: Daily Digest - April 28

So how much are you guys donating LOL.......I need to make sure I don't look to cheap.

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Re: Daily Digest - April 28
idoctor wrote:

So how much are you guys donating LOL.......I need to make sure I don't look to cheap.

Lol, I'll let you know if it takes negative numbers.

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Ken C
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Re: Holy Cow, UST Is Taking Online Donations To Pay Down ...
joemanc wrote:

Unbelievable...

Quote:

As far as we know, this is nothing new, still it's pretty remarkable. The Treasury is taking online donations to pay down the debt.

http://www.businessinsider.com/holy-cow-the-treasury-is-taking-online-do...

 

I keep getting this mental picture of Turbo Timmy standing on the street corner with a tin cup.

 

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wildjo
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Re: Daily Digest - April 28
printfaster wrote:

Just to set the record straight, at least 8 Tr of the current 12 Tr Federal debt was run up under Republican administrations

Got it.  Bush did it, so there is no need to be  responsible for anything.  You also forget that the last two years of the Bush administration the Democrats were in charge of all spending, including TARP, and they were the ones that approved of Paulson after Bush tried to have a treasury secretary not under control of Goldman.

Now for

The last Democrat was the only president since before Reagan to actually make headway on cutting the debt

That was largely done by shortening the yield curve and riding on taxation of the internet bubble stock gains.  When Clinton finally departed, Treasury quit issuing 30s or anything longer than 10, and the bubble was over.

 

It doesn't matter which party is in office--it's all about our unsustainable, selfish, short-sighted effort to maintain the status quo +1 ad infinitum.  We need a cultural shift, not just an election.

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Davos
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Re: Holy Cow, UST Is Taking Online Donations To Pay Down ...
Ken C wrote:
joemanc wrote:

Unbelievable...

Quote:

As far as we know, this is nothing new, still it's pretty remarkable. The Treasury is taking online donations to pay down the debt.

http://www.businessinsider.com/holy-cow-the-treasury-is-taking-online-do...

 

I keep getting this mental picture of Turbo Timmy standing on the street corner with a tin cup.

 

Me too. The problem is the 535 +/- clowns that he gives the money to, they will blow the cash on their vice. It won't go to debt.

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ashvinp
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Re: Daily Digest - April 28
wildjo wrote:

It doesn't matter which party is in office--it's all about our unsustainable, selfish, short-sighted effort to maintain the status quo +1 ad infinitum.  We need a cultural shift, not just an election.

Well said. As a society we love to point the finger at anyone but ourselves.

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britinbe
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Re: Daily Digest - April 28
idoctor wrote:

So how much are you guys donating LOL.......I need to make sure I don't look to cheap.

Aside for the political union differences, how is Greece different from say California, does one interest rate policy fit the entire US, are some states less competitive than others??  A real problem yes, but how much gloating is going on from analysts focussing on someone elses problems rather than their own??

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Davos
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Re: Daily Digest - April 28
britinbe wrote:

 

Aside for the political union differences, how is Greece different from say California, does one interest rate policy fit the entire US, are some states less competitive than others??  A real problem yes, but how much gloating is going on from analysts focussing on someone elses problems rather than their own??

California, Michigan, Florida and many, many other states are in the same boat. Harrisburg PA is close to filing chapter 9. The US will follow - or lead, with sovereign default. They are dreaming if they think they can have enough inflation and gently debase the currency without winding up like Zimbabwe. Remember, we are talking about utter and absolute delusional morons here.

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jamesdvetter
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Posts: 51
Re: Daily Digest - April 28
Davos wrote:
britinbe wrote:

 

Aside for the political union differences, how is Greece different from say California, does one interest rate policy fit the entire US, are some states less competitive than others??  A real problem yes, but how much gloating is going on from analysts focussing on someone elses problems rather than their own??

California, Michigan, Florida and many, many other states are in the same boat. Harrisburg PA is close to filing chapter 9. The US will follow - or lead, with sovereign default. They are dreaming if they think they can have enough inflation and gently debase the currency without winding up like Zimbabwe. Remember, we are talking about utter and absolute delusional morons here.

 

As usual, couldn't have said it any better than Davos

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