Daily Digest

Daily Digest - July 18

Saturday, July 18, 2009, 9:50 AM
  • BIS, The Central Bank of all Central Bankers: The Central Bank WAS Warned in 2003
  • Joe Biden: ‘We Have to Go Spend Money to Keep From Going Bankrupt’
  • Want to Know How to Go Broke? 
  • Treasury Position
  • Glenn Beck and Ron Paul: Goldman Sachs (Video on page)
  • Q&A : Janet Tavakoli (Video on page)
  • CBO Projected Deficit, by Source (Char on page)
  • TIC flows (Treasury International Capital) were NEGATIVE (White paper on page)
  • MSNBC Video: False Economy (Video on page)
  • JPM's Dimon: CRE "Big deal for regional banks"
  • Report: Record Foreclosure Activity in First Half
  • Seasonally-adjusted jobless claims way down but…

Economy

BIS, The Central Bank of all Central Bankers: The Central Bank WAS Warned in 2003

I respectfully suggest reading the entire piece.

  Joe Biden: ‘We Have to Go Spend Money to Keep From Going Bankrupt’

“We’re going to go bankrupt as a nation,” Biden said.

“Well, people when I say that look at me and say, ‘What are you talking about? You’re telling me we have to go spend money to keep from going bankrupt?’” Biden said. “The answer is yes, I’m telling you.”

 Want to Know How to Go Broke? 

I have a very simple program for going broke. Follow this logic and its guaranteed. Nothing like getting in front of the AARP union of old folks and threatening them with spending money to not go broke. Kumbaya, my Lord, Kumbaya…

Treasury Position

The Contractor shall conduct two, 3-hour, Humor in the Workplace programs that will discuss the power of humor in the workplace, the close relationship between humor and stress, and why humor is one of the most important ways that we communicate in business and office life. Participants shall experience demonstrations of cartoons being created on the spot. The contractor shall have the ability to create cartoons on the spot about BPD jobs. The presenter shall refrain from using any foul language during the presentation. This is a business environment and we need the presenter to address a business audience.

Glenn Beck and Ron Paul: Goldman Sachs (Video on page)

Q&A : Janet Tavakoli (Video on page)

CBO Projected Deficit, by Source (Char on page)

TIC flows (Treasury International Capital) were NEGATIVE (White paper on page)

(Treasury International Capital) were NEGATIVE by "only" $66.6 billion ...

MSNBC Video: False Economy (Video on page)

JPM's Dimon: CRE "Big deal for regional banks"

Jamie Dimon: Commercial Real Estate in the United States of America is going to get worse consistently over the next several quarters. That should not be a surprise to anybody. We've got two major Real Estate exposures, we have what we call CTO which is multi-family smaller loans, it's performing fine and-- what we got from WaMu, that's the commercial bank, 30 Billion portfolio from WaMu -- it will get worse but we don't expect it to be significant, materially significant to our numbers, and we also have a more traditional Real Estate portfolio but I would say both the Bank One, JP Morgan and Chase, we've been so conservative of the last eight or nine years it's been doing nothing but in general shrinking other than the acquisition of WaMu [ it’s 12 billion] and losses are, charge-offs were for the Real Estate banking, 186 basis points and the commercial term lending was 36 and both will get worse but they aren't that big a number for us. It [commercial real estate] is a big deal for regional banks.

Report: Record Foreclosure Activity in First Half

RealtyTrac ... today released its Midyear 2009 U.S. Foreclosure Market Report, which shows a total of 1,905,723 foreclosure filings — default notices, auction sale notices and bank repossessions — were reported on 1,528,364 U.S. properties in the first six months of 2009, a 9 percent increase in total properties from the previous six months and a nearly 15 percent increase in total properties from the first six months of 2008. The report also shows that 1.19 percent of all U.S. housing units (one in 84) received at least one foreclosure filing in the first half of the year.

Seasonally-adjusted jobless claims way down but…

On the surface this week’s jobless claims data look very good. Initial claims came in at 522,000, the best since the first week of the year and pulling the 4-week average below 600,000 for the first time in about six months. Moreover, there was a huge dip in continuing claims to 6.27 million, down from the upwardly revised figure of 6.91 million. And the year-over-year trends continue their steady march downward. This is the best weekly data on seasonally-adjusted figures we have seen in months. It’s all good, right?

 

15 Comments

idoctor's picture
idoctor
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Re: Daily Digest - July 18

 Davos here are Joe Biden's own words:  

WOW beyond Amazing!!! Eeeeeeck..... do we even have a chance in hell at a soft landing with these ultra sharp minds working hard for us on our very own hard earned tax payer dollars?

 Also Davos (speaking of other ultra sharp minds (Jimmy's LOL) I ran across this old Time Magazine article on Jimmy vs Inflation. Things looked pretty bad then with 18% but we survived OK. Any thoughts?

 http://www.time.com/time/magazine/article/0,9171,921854-1,00.html

 

Art Cashin: Traders Don't Trust 'Short Term' Earnings

http://www.cnbc.com/id/15840232?video=1185726710&play=1

Joe asks Art what is coming up on June 22-23rd? Art says : a Solar eclipse..we have to see if this changes the ionization in the upper atmosphere.

that pretty well sums it up!

PS Peter Schiff 7/17/2009

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mainecooncat
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Re: Daily Digest - July 18

Concerning the CBO projected deficits over the next ten years, the first comment below the chart says it all for me: "I remember the 2000 election, when Gore and Bush discussed what they would do with the projected $1T surplus for the next 10 years. Those were the days."

Since we have no idea what's going to happen (9/11, subsequent wars in Afghanistan and Iraq, housing bubble, systemic malfeasance, etc.) and usually choose not to prepare for "bad things" because that positioning is seen as too pessimistic, too anti-"morning in America," these CBO predictions might as well be a toss of  the yarrow sticks.

It seems impossible to me that with the multitude of impending crises on the horizon documented by this website (including what could be the greatest wildcard of all: swine flu) that all of a sudden in a year or two the budget deficit will be returning to a mere $200 billion. Just think how much better the US was positioned ten years ago.

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VeganDB12
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Re: Daily Digest - July 18-Why healthcare now?

Guys (and Gals)

I have a question.  This is going to sound real simple. 

Why in the world are they pushing so hard for healthcare NOW?  Isn't it obvious that it will accelerate the collapse of the economy, what am I missing here?

As  you all have pointed out so well Biden's excuse is patently absurd (even if he does believe it!).  A cynical peer of mine thinks it is a way of appeasing the masses in case all other manner of SHTFing (overflow issues related to the pandemic, economic collapse,  and the other things Mainecoonecat points out) causes civil discontent. 

I honestly don't know and I work in healthcare.  The best I can figure is that it is some bizarre combination of power grabbing to control healthcare and socialist agenda to care for the masses.  It makes no sense to do this now. 

The irony is, the AARP'ers stand to get hurt the worst in this, there will have to be rationing and to give a sense for what that might look like you can read Peter Singer's NYT article on hea;thcare rationing if you are interested (it is a tiny bit disturbing in parts especially his views on the disabled) . Registration might be required, I don't know.

http://www.nytimes.com/2009/07/19/magazine/19healthcare-t.html?scp=1&sq=...

Regards and good wishes to all

D

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JAG
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Re: Daily Digest - July 18

Great find on the William White article Davos, I really enjoyed it. Too bad we are the ones to suffer from Greenspan's arrogance. I thought the last paragraph was especially fruitful:

He is familiar with human nature, and he knows how to handle it. White is more concerned about the things he doesn't understand. New Zealand is a case in point. Interest rates were raised early in the crisis there, and yet the central bank was unable to come to grips with the credit bubble. Investors were apparently borrowing cheap money from foreign lenders.

 

This is the sort of thing that worries him. "That's when you have to ask yourself: Who exactly is controlling the whole thing anymore?"

Perhaps his model has a flaw in that regard. Could it be possible that central bankers today have far less influence than he assumes?

Can the Fed "control" human nature? Can anyone?

idoctor's picture
idoctor
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Re: Daily Digest - July 18

NorthWest Economic Expedition - George4Inflation.us & TNT

http://www.youtube.com/user/InflationUS#play/all/uploads-all/1/8MmDacbZ0WA

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A. M.
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Re: Daily Digest - July 18

Denise,

I think it's just a case of "too many chefs spoil the broth".

There are so many agendas that have been pressed into service without being fully thought through, developed or executed that this to me looks like building a hospital on a bridge over a swamp.
That said, most of the nit-wits out there think this is great news! 

The poor folk are thinking "free medical care", and the guys who pay for their medical care are thinking "Lower premiums, on account I don't have to pay for those guys!"

Truly - I think this is just a case of "monkey see, monkey do" with the Obama administration. They look at Europe and say "They did it."

So...? Why not us?

I love it when I hear people say "The government should do ________." where "________" equals "spending money". Why don't they realize that the government only has money because it takes it away from us?
Would they be so loose with their own wallets?

Probably not.

Aaron

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VeganDB12
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Re: Daily Digest - July 18

Aaron

Thank you for your response. It makes sense.  People comparing US to Europe/Canada is really an apples and oranges comparison but I agree they make that argument all the time.  I used to make that argument too.  That was before the crash of the ecnomy. It is shocking that such an effort is being made to push it through even now. I just wanted to say I appreciate your answer.

Regards

D

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Robinson
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Re: Daily Digest - July 18

Here is a lot of good cartoons,  i like the obama call to the money printing press, jaja 

cartoosh.blogspot.com/search/label/Economy

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Re: Daily Digest - July 18

 

Guys (and Gals)

I have a question.  This is going to sound real simple. 

Why in the world are they pushing so hard for healthcare NOW?  Isn't it obvious that it will accelerate the collapse of the economy, what am I missing here?

Denise, I've been having the same issue with this, and the only thing that makes sense to me (with Kunstler's world in view) is the the gov't can't hold the states together any other way. Having a national healthcare program run by the top, enables the gov't to keep the union together. It also gives them something "important" to do as the SHTF.

They can't create jobs. Can't create wealth. And people can fly under the radar with an underground economy. But healthcare? This will unite the Union and force us to participate. Like one giant band-aid to hold regions together.

It does puzzle me, though. How come it's not touted as a War on Health ;)

john

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Re: Daily Digest - July 18-Why healthcare now?
Denise wrote:

 

Why in the world are they pushing so hard for healthcare NOW? 

Hi Denise,

I haven't been following the healthcare issue, so I really have no idea what I'm talking about here specifically, but I can generalize.

Let us assume that by very nature, politicians act only in their self-interest. Now we should take a look at who funded Obama's election:

 

University of California $1,564,490 Goldman Sachs $994,795 Harvard University $854,017 Microsoft Corp $833,617 Google Inc $803,436 Citigroup Inc $699,790 JPMorgan Chase & Co $695,132 Time Warner $589,334 Sidley Austin LLP $588,598 Stanford University $586,557 National Amusements Inc $550,683 UBS AG $543,219 Wilmerhale Llp $542,618 Skadden, Arps et al $530,839 IBM Corp $527,572 Columbia University $526,802 Morgan Stanley $514,881 General Electric $499,130 Latham & Watkins $493,835 US Government $491,420
 

 

I would suggest that somewhere in that public list, one or more of those entities would benefit from the healthcare proposal. Who and how specifically, I have no idea.

I agree that it is extremely frustrating that the administration would force its agenda down the throat of a anemic economy. Maybe we as a people, should put together a fund to lobby our own government to act in our best interest. If everyone pitched in a few dollars, we should be able to "out-lobby" the corporations. If our vote means nothing, then maybe we should just buy our government. 

Sorry to be so negative.

CB's picture
CB
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Re: Daily Digest - July 18

Reflecting on the death of Walter Cronkite Glen Greenwald qouted from a Harpers article following the death of Tim Russert by Lewis Lapham titled "elegy for a rubber stamp" I think it germane to any discussion of news media "reporting" today:

Quote:

On television the voices of dissent can’t be counted upon to match the studio drapes or serve as tasteful lead-ins to the advertisements for Pantene Pro-V and the U.S. Marine Corps. What we now know as the “news media” serve at the pleasure of the corporate sponsor, their purpose not to tell truth to the powerful but to transmit lies to the powerless. Like Russert, who served his apprenticeship as an aide-de-camp to the late Senator Daniel Patrick Moynihan, most of the prominent figures in the Washington press corps (among them George Stephanopoulos, Bob Woodward, and Karl Rove) began their careers as bagmen in the employ of a dissembling politician or a corrupt legislature. Regarding themselves as de facto members of government, enabling and codependent, their point of view is that of the country’s landlords, their practice equivalent to what is known among Wall Street stock-market touts as “securitizing the junk.” When requesting explanations from secretaries of defense or congressional committee chairmen, they do so with the understanding that any explanation will do. Explain to us, my captain, why the United States must go to war in Iraq, and we will relay the message to the American people in words of one or two syllables. Instruct us, Mr. Chairman, in the reasons why K-Street lobbyists produce the paper that Congress passes into law, and we will show that the reasons are healthy, wealthy, and wise. Do not be frightened by our pretending to be suspicious or scornful. Together with the television camera that sees but doesn’t think, we’re here to watch, to fall in with your whims and approve your injustices. Give us this day our daily bread, and we will hide your vices in the rosebushes of salacious gossip and clothe your crimes in the aura of inspirational anecdote.

We are left to our own devices when attempting to parse and divine meaning from public pronouncements and stated policy objectives. Why the push for health care now? Be sure to leave any altruistic motive out of the equation when searching for a rationale. A bone for the masses is as reasonable a choice as any, something to maintain the appearance of doing something of value for the people - while ensuring the maintenance of the status quo as the underlying prime directive.

IMO guaranteed standard healthcare should rightly be the provence of the national government. It should not be left to the whims of private entities driven fundamentally by a profit motive. Maintaining a healthy and well educated populace is surely in the national interest. Just as for a business, investment in plant maintenance and infrastructure, research and development, are critical to future profits, the community at large requires investment in healthcare and education to prosper.

That said I have no faith the current fuss over national healthcare will result in a reasonable, cost effective plan. A likely outcome would be in tune with the "drug benefit" that was passed under Bush that simply guaranteed the existing profit structure for manufacturers. Just as in the "financial services" market, profiting from non-productive inefficiencies is a poor long-term strategy that harms the nation as a whole. Chances of changing the system in fundamentally critical ways? Zero, none, nada - just like the financial crash has brought needed changes...

Given the current state of the economy one can only speculate that either congress and the president have all drunk the same koolaid or that they are trying to divert attention from the impending changes soon to be thrust upon us (dictated by the circumstances of our financial predicament).... or both.

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Re: Daily Digest - July 18

 Hello Denise:

Sometimes I wonder if they are intentionally running it into the ground so they can wipe out the debt through default. I mean, when you here them talk and when you look at their past positions I myself say, these aren't idiots - but based on their actions sometimes I wonder if they are just playing dumb.

Take care

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SagerXX
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Re: Daily Digest - July 18-Why healthcare now?
JAG wrote:

General Electric $499,130  

I would suggest that somewhere in that public list, one or more of those entities would benefit from the healthcare proposal. Who and how specifically, I have no idea.

Well, GE has a massive medical division.  I assume if they'd stand to benefit.

 

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What's the Rush

I've been wondering myself why the rush on both cap-and-tax and Obamacare.  My best explanation is that Obama's star is crashing to Earth in a big hurry.  The public is very aware of (1) the fact that we are broke and (2) the goings on in Congress.  People are really truly paying attention.  These two measures create huge additional burdens on the public, which now knows that they will be forced to pay for the bailouts/stimulus. Now these too?!?!  The voting public has had enough and they are letting their representatives hear their side of things.  I don't see either cap-and-tax as passed by the House, or Obamacare in any form becoming law any time soon.  Obama has lost his clout and he is finally being seen for what he is and always has been.

And people thought Bush, Jr. was an idiot.  How pre tell do people like Joe Biden get elected to the Senate, let alone Vice President of the United States?

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Malden
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Re: Daily Digest - July 18

How can a sovereign nation be broke regarding its own currency? Most of money is made from paper or in pure electronic form. It`s apsurd to say that you are broke! What troubles America and most of the world is a fact that you don`t have sovereignity over national monetary policy and money creation process.

Today, all money is created by private banks (mostly commercial). When they reduce or stop lending, the amount of money in circulation shrinks, because old debts are paid off and there is no new credit to replace them. Without necessary medium of exchange, an economy crumbles. What we have here is a confusion with terminology. Real (fiat) money is a permanent medium of exchange based on law and issued by government (or Congress) for oiling a wheels of the economy with no debt or interest. Credit on the other hand is only temporary and when it`s controled by private entities, it delivers them unspeakable power over society  http://www.monetary.org/toddaltmanreview.htm

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