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Daily Digest - Dec 15

Monday, December 15, 2008, 8:07 AM

Housing wave two (CBS 60 minutes), AIG offers 'retention' pay to larger group of workers, "Don't buy stuff you cannot afford", unemployment funds run out for states, consumer spending to ebb further than expected, Goldman Sachs draws (more) fire.

Economy

Housing, Wave Two (CBS 60 Minutes)

SNL (Humor) Crash Course Simplified (Don't Buy Stuff)

AIG Said to Offer Retention Payment to Bigger Group of Workers

The "retention bonus" equals as much as a year's salary and recipients were ordered to keep the payment secret, said the person, who declined to be named because the plan was labeled confidential. Awards were offered to as much as 10 percent of staff at businesses that are for sale, including plane-leasing and insurance units in the U.S. and overseas, the person said.

States' Funds for Jobless Are Drying Up

Thirty states are at risk of having the funds that pay out unemployment benefits become insolvent over the next few months, according to the National Association of State Workforce Agencies. Funds in two states, Indiana and Michigan, have already dried up, and both states are borrowing from the federal government to make payments to the unemployed.

Consumer spending to ebb more than investors see

The consumer recession will be so "deep and brutal" the U.S. retail industry could lose one out of every 10 stores in coming years, Kravetz said.

Goldman Draws Ire for Advising Default Swaps Against New Jersey

 

In the three months since the New York-based securities firm recommended "shorting municipal credit," the value of the Markit MCDX index of the derivatives' price more than tripled, to as high as 278.33 basis points from 87.75. A basis point on a credit-default swap protecting $10 million of debt for five years is equivalent to $1,000 annually.

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11 Comments

crymoney's picture
crymoney
Status: Member (Offline)
Joined: Sep 5 2008
Posts: 18
Re: Daily Digest - Dec 15

Thanks Davos

The S&L bit was funny because it's too close to reality. 

Max Kaiser made a flick on naked short selling in 07. If anyone else wants an explanation of this practice, Max makes it easy to (sort of) grasp. 

 

 

RussB's picture
RussB
Status: Silver Member (Offline)
Joined: Dec 9 2008
Posts: 101
Re: Daily Digest - Dec 15

Unfortunately, as a New Jersey resident I know NJ probably warrants this.

Still, I'd like to see if Corzine dares to criticize his former company for doing this.

As for AIG, their sheer audacity is mind-boggling. After the flap over the luxury retreats, and after they have repeatedly begged for more and more welfare, and after seeing the banks have to backpedal on handing out bonuses, that they would still do this is proof that they are incorrigible. There is no conceivable way these criminals or this company can ever be a constructive part of civilization.

What we have here is a pathological sense of entitlement. It is psychopathic. And yet no one's going to do anything about it....

crymoney's picture
crymoney
Status: Member (Offline)
Joined: Sep 5 2008
Posts: 18
Re: Daily Digest - Dec 15

Could be this, could be that. But it looks like precious metals are beginning to free themselves from the gravitational pull of the larger market. Just an observation that could be dead wrong. If correct, it is an interesting sign post.

jrf29's picture
jrf29
Status: Gold Member (Offline)
Joined: Apr 18 2008
Posts: 453
Here, let me lend you some of your own money.
Quote:

...states are borrowing from the federal government to make payments to the unemployed.

 

Something about the idea of the states being in debt to the federal government strikes me as destructive to the very basis of our system of constitutional checks and balances.  This infuriates me.  Let me see if I have this right:

The federal government takes money by taxation from the citizens of the fifty states, and then LENDS IT back to them. With interest! The unbelievable audacity of this is almost too much to comprehend.

 

 

 

castlewp's picture
castlewp
Status: Gold Member (Offline)
Joined: Oct 7 2008
Posts: 304
Re: Here, let me lend you some of your own money.

Yes it's called a Ponzi scheme.  Side note:  I was talking with a friend today about the economy and the topics on cm.com and he had the look of a cow watching a train go by.  It amazes me the ignorance and apathy by everyone, the "I don't know and I don't care" attitude is just incredible.  

Sorry just wanted to vent. 

Davos's picture
Davos
Status: Diamond Member (Offline)
Joined: Sep 17 2008
Posts: 3620
Re: Daily Digest - Dec 15

Cartoon Eric G. Lewis

We need to move Paulson and Bernanke behind the pig. 

Mike Pilat's picture
Mike Pilat
Status: Platinum Member (Offline)
Joined: Sep 8 2008
Posts: 929
Re: Daily Digest - Dec 15

Yes, I agree, the utter apathy is absolutely incredible. It's hard for me to be patient sometimes, in all honesty.

The notion of states being indebted to a central government is not only disgusting, it is destructive. There is no possible way that the central government will be capable of micromanaging every aspect of our future as it does now. The Roman Empire really and truly existed and dominated the world. And it really and truly collapsed too.

jerry_lee's picture
jerry_lee
Status: Martenson Brigade Member (Offline)
Joined: Sep 24 2008
Posts: 126
Limerick inspired by castlewp post

I was trying hard to explain,

To a cow who was watching a train,

'Bout the audacious nerve

Of the Federal Reserve.

But she just wasn't feeling my pain. 

castlewp's picture
castlewp
Status: Gold Member (Offline)
Joined: Oct 7 2008
Posts: 304
Re: Limerick inspired by castlewp post

Bob Dylan??

jerry_lee's picture
jerry_lee
Status: Martenson Brigade Member (Offline)
Joined: Sep 24 2008
Posts: 126
Re: Limerick inspired by castlewp post

Dylan HAS written a few train songs and probably a  cow song or two. If he'd just combine the 2, he might make a name for himself.

Humor and music DO help me maintain a balance of sorts during these times. Hey, how about the old Dylan standard "The Times They Are A Crashing"? 

crymoney's picture
crymoney
Status: Member (Offline)
Joined: Sep 5 2008
Posts: 18
Daily Digest joke

This dumb blond joke somehow reminds me of our current economic situation. Fortunately for guys like Mr. Paulson, there are still lots of blonds on the plain. 

A blond was riding on an airplane. All of a sudden, there was a loud noise outside the plane. The captain came on the intercom, "Attention passengers, we just lost one of our engines; but don't worry, the other three will keep us flying. Also, we will arrive at our destination about an hour behind schedule."


Half an hour later, another loud noise sounded from outside the plane. The captain once again came on the intercom, "Attention passengers, do not be alarmed. We lost another engine, but the other two will keep us up just fine. But we will now be arriving about three hours late."

After the captain said this, the blond leaned over to the passenger next to her and said, "If those other two engines go out, we will be up here all day."

 

 

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