Daily Digest

Daily Digest - October 4

Sunday, October 4, 2009, 10:00 AM
  • September Unemployment
  • Kenneth Langone Says U.S. In Horrible Economic Storm
  • Max Keiser and Stacy Herbert -- Mum's the word on derivatives at G20 
  • Personal Bankruptcies up 41% YoY 
  • The Real Reason the Giant, Insolvent Banks Aren't Being Broken Up
  • The Fed Fighter: DealBook’s Ron Paul Interview 
  • On Point – Unemployment Report…
  • U.S. Sept non-farm payrolls plunge 263,000
  • ‘TARP’ Turning Out to Be Largest Taxpayer Swindle in U.S. History
  • Systemic Failure Series
  • Deflation warning? Treasury bond yields plunge amid new rush for safety
  • Pimco’s Gross Buys Treasuries Amid Deflation Concern
  • Let's Get Bill Gross In A Debate With Jim Rogers
  • Bilderberg Plan in Action?
  • Musings: Crude Oil Prices Track Stock Market Performance 


September Unemployment (Skylight MT)

But the Household Data is VASTLY worse than reported. Here are the month-over-month changes, and they're in the realm of frightening. (all numbers in thousands) Civilian Labor Force: 154,879 to 153,617 this month. Employed: 140,074 down to 139,079 this month. That's a loss of 995,000 jobs, not 263,000, and the labor force contracted by 1,262,000 people!

The participation rate was absolutely decimated, down 0.6% this last month alone. The people "not in the labor force" rose by a staggering 1,516,000 in the last month. The government doesn't count people as "unemployed" who have given up and exited the labor force, but as I have repeatedly noted whether the government counts them or not the corner store owner sure as hell does! The fact of the matter is that nearly 1 million fewer people were working in September as compared to August; there has been absolutely no improvement in that trend whatsoever.

Kenneth Langone Says U.S. In Horrible Economic Storm (anonymous)

Home Depot Co-Founder: "If we did in business what the government's doing about saying "it's getting better, it's getting better," we'd go to jail for manipulation or fraud. It's not getting better and it shouldn't get better." (Video on page)

Max Keiser and Stacy Herbert -- Mum's the word on derivatives at G20 (Video, Musings_From_The_Fringe)

Max Keiser and Stacy Herbert discussing the G20's failure to do anything about derivatives. Instead, Larry Summers' attempted to pin the blame on overspending Americans and oversaving Chinese, saying all would be well if only the two came more into "balance".

Personal Bankruptcies up 41% YoY (Skylight MT)

Consumer bankruptcies totaled 1,046,449 filings through the first nine months of 2009 (Jan. 1-Sept. 30), the first time since the 2005 bankruptcy overhaul that filings have surged past the 1 million mark during the first three calendar quarters of a year, according to the American Bankruptcy Institute (ABI), relying on data from the National Bankruptcy Research Center (NBKRC). The filings for the first three-quarters of 2009 were the highest total since the 1,350,360 consumer filings through the first nine months of 2005.

The Real Reason the Giant, Insolvent Banks Aren't Being Broken Up (Vinny A.)

Why isn't the government breaking up the giant, insolvent banks? We Need Them To Help the Economy Recover? Do we need the Too Big to Fails to help the economy recover?

The Fed Fighter: DealBook’s Ron Paul Interview (Vinny A.)

The fallout from the credit crisis has put the financial system of the United States under a microscope. Banker pay, lending practices and regulatory oversight are now topics of mainstream interest for the first time since the Great Depression. As Congress debates whether or not to give more power to the Federal Reserve to watch over the financial system, Ron Paul, the Republican congressman from Texas, is arguing, as he has for years, for the government to go in the opposite direction and actually cut the Fed’s powers. In an interview with DealBook on Thursday, Mr. Paul discussed his new book, “End the Fed,” as well as his views on Wall Street. The outspoken lawmaker contends that the government is essentially controlled by the Fed and in collusion with Wall Street, and has created an unsustainable economic system through the excess printing of money. He predicts that the system will eventually break down and the dollar will collapse, creating economic chaos. Here are edited and condensed excerpts from DealBook’s talk with Mr. Paul.

On Point – Unemployment Report… (Vinny A.)

“Czar Point,” a regular commenter on the Economic Edge, gave two very pointed posts on how he views the numbers inside this morning’s employment report. The numbers are STUNNING, and they are the TRUTH. Math does not lie and cannot be spun… statistics can be, but not simple math. Point simply takes out his calculator and adds them up. You will be shocked…

U.S. Sept non-farm payrolls plunge 263,000 (Vinny A.)

WASHINGTON (Reuters) - U.S. employers cut a deeper-than-expected 263,000 jobs in September, lifting the unemployment rate to 9.8 percent, according to a government report on Friday that fueled fears the weak labor market could undermine economic recovery. The Labor Department said the unemployment rate was the highest since June 1983 and payrolls had now dropped for 21 consecutive months.

Analysts polled by Reuters had expected non-farm payrolls to drop 180,000 in September and the unemployment rate to rise to 9.8 percent from 9.7 percent the prior month. The poll was conducted before reports, including regional manufacturing surveys, showed some deterioration in employment measures.

The government revised job losses for July and August to show 13,000 more jobs lost than previously reported. Preliminary annual benchmark revisions, released together with September's employment report showed that total non-farm payroll employment for March would have to be revised down about 824,000.

‘TARP’ Turning Out to Be Largest Taxpayer Swindle in U.S. History (Vinny A.)

CONGRESS AND THE WHITE HOUSE have been busy lately patting themselves on the back for staving off financial armageddon by handing out taxpayer money to Wall Street like it was Halloween candy. But while they’re trumpeting the fact that some financial firms have returned a tiny portion of the trillions of dollars that were given to banks, reality is setting in that Americans will never see that money again and will be paying it off for many, many years to come.

In late September, legislators quietly assessed whether they should begin phasing out some government aid programs like the Troubled Asset Relief Program, or TARP, which appropriated $700 billion— all of which had to be borrowed from bankers and foreign countries—to purchase bad investments, known as toxic assets, owned by financial firms.

Systemic Failure Series (C. Watcher)

Systemic Failure Series Jim Willie (kingworldnews, audio interview) (c.watcher) In this interview, part 1 of the 4 part “Systemic Failure Series” Jim discusses insolvency problem plaguing the United States, the housing bust albatross, accounting fraud in the banking system, the worst banks acquiring and consolidating other banks, perpetuation of this vicious cycle and much more.

Deflation warning? Treasury bond yields plunge amid new rush for safety (C. Watcher)

Money is pouring into Treasury bonds today, driving yields sharply lower as investors start the fourth quarter with another rush into what they perceive to be safe. Falling market yields mean bond prices are rising. That should give a big boost today to the most popular bond mutual fund, Pimco Total Return, which has been loading up on long-term Treasuries in recent weeks, as detailed by portfolio manager Bill Gross.

Pimco’s Gross Buys Treasuries Amid Deflation Concern (C. Watcher)

“We’ve exchanged our mortgages for the government’s check” as the Federal Reserve winds down purchases of agency debt, Gross said today. “Mortgages are expensive compared to Treasuries and other vehicles.” Fed policy makers last week committed to complete their $1.45 trillion in purchases of mortgage securities and extended the end of the program to March from December.

Let's Get Bill Gross In A Debate With Jim Rogers (C. Watcher)

Gross explains to a skeptical panel of pundits why he has shifted into longer-dated bonds (i.e., 10-year treasuries): the fed typically will not tighten (i.e., raise short-term interest rates) until unemployment has be going down for at least 12 months—we have a lot of jobs to create before that. The new normal is a slow growth outlook of 1-2 percent per year with deleveraging, deregulation and deglobalization.)

Bilderberg Plan in Action? (Michel S.)

In May of 2009, I wrote an article covering the Bilderberg meeting of 2009, a highly secretive meeting of major elites from Europe and North America, who meet once a year behind closed doors. Bilderberg acts as an informal international think tank, and they do not release any information, so reports from the meetings are leaked and the sources cannot be verified.

However, the information provided by Bilderberg trackers and journalists Daniel Estulin and Jim Tucker have proven surprisingly accurate in the past. In May, the information that leaked from the meetings regarded the main topic of conversation being, unsurprisingly, the economic crisis. The big question was to undertake "Either a prolonged, agonizing depression that dooms the world to decades of stagnation, decline and poverty ... or an intense-but-shorter depression that paves the way for a new sustainable economic world order, with less sovereignty but more efficiency."


Musings: Crude Oil Prices Track Stock Market Performance (Samuel A.)

I actually heard about this on Japanese TV first... I have a really hard time imaging how these people see this as a good thing.


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Re: Daily Digest - October 4


Will California become America's first failed state?    Perhaps, but it won't be the only one.    Several more next in line so California won't be too lonely.


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Re: Daily Digest - October 4

That  Angela Davis speach started out interesting and empowering.  Wow, we don't have to be heros to effect change, we can make the world better all by ourselves!


Then she went to a really icky place, where at about the 30 minute mark she started glorifying communism and insisting that everyone should receive a living wage as a gift.  No sense of who was going to FUND that living wage, or what it does to humans when you remove the requirement that they obtain their basic necessities of life through their own efforts or family ties.  It started sounding to me like someone saying, "yeah, and you can get ALL THE MONEY YOU WANT if you just hold up gas stations!  It's WONDERFUL!"

So, what was your POINT in posting this?  To identify what zombies sound like?

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Inflation / deflation -Amerman

Interesting and easy to understand  post for the ongoing inflation/ deflation debate-


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BLS Update: Unemployment For Sept Is 785,000, not 250,000

One of the posters on Nate's site, Joe, noticed this update to the Civilian Unemployment Numbers this morning,

The federal reserve of St Louis has updated their household data charts with last week's jobs data. Attached is the YoY change in civilian employment in the US. The economy lost 785,000 jobs last month, not the 250,000 that was reported. All told, we've lost 7.8 MILLION jobs since the peak in November 2007. The government LIES to us.

Chart 1

Chart 2

Chart 3

Holy Cow, thats a huge difference!


(edit: fixed chart links)

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Re: Daily Digest - October 4


I found this speach very interesting, which does not means I support everything Angela Davis says.

As for the communist reference, she just says something like "despite failing to bring social and political democracy, they succeded to provide free and good heathcare and education for everyone."

Some figures might question the benefits of a capitalist-profits-oriented heathcare, education... in "some" countries vs "socialist" public services.

List of countries by infant mortality rate

Rank Country or territory Infant mortality rate (deaths/1,000 live births) Under-five mortality rate (deaths/1,000 live births) 

1 Iceland 2.9 3.9

2 Singapore 3.0 4.1

3 Japan 3.2 4.2

4 Sweden 3.2 4.0

5 Norway 3.3 4.4

6 Hong Kong 3.7 4.7

7 Finland 3.7 4.7

8 Czech Republic 3.8 4.8

9 Switzerland 4.1 5.1

10 South Korea 4.1 4.8

11 Belgium 4.2 5.3

12 France 4.2 5.2

13 Spain 4.2 5.3

14 Germany 4.3 5.4

15 Denmark 4.4 5.8


28 Cuba 5.1 6.5


33 United States 6.3 7.8

Human Poverty Index

Ranking Country HPI-2 Probability at birth of not surviving to age 60 (%) People lacking functional literacy skills (%) Long-term unemployment (%) Population below 50% of median income (%)

1 Sweden 6.3 6.7 7.5 1.1 6.5

2 Norway 6.8 7.9 7.9 0.5 6.4

3 Netherlands 8.1 8.3 10.5 1.8 7.3

4 Finland 8.1 9.4 10.4 1.8 5.4

5 Denmark 8.2 10.3 9.6 0.8 5.6

6 Germany 10.3 8.6 14.4 5.8 8.4

7 Switzerland 10.7 7.2 15.9 1.5 7.6

8 Canada 10.9 8.1 14.6 0.5 11.4

9 Luxembourg 11.1 9.2 - 1.2 6.0

10 Austria 11.1 8.8 - 1.3 7.7

11 France 11.2 8.9 - 4.1 7.3

12 Japan 11.7 6.9 - 1.3 11.8

13 Australia 12.1 7.3 17.0 0.9 12.2

14 Belgium 12.4 9.3 18.4 4.6 8.0

15 Spain 12.5 7.7 - 2.2 14.2

16 United Kingdom 14.8 8.7 21.8 1.2 12.5

17 United States 15.4 11.6 20.0 0.4 17.0

List of countries by literacy rate

Rank Country Literacy rate [b]

1 Cuba 99.8

1 Estonia 99.8

1 Poland 99.8 [j]

4 Barbados 99.7 [j]

4 Latvia 99.7

4 Slovenia 99.7 [l]

7 Belarus 99.6

7 Lithuania 99.6

9 Kazakhstan 99.5


Countries that no longer measure literacy statistics

In the United States, according to Business magazine, an estimated 15 million functionally adults held jobs at the beginning of the 21st century. The American Council of Life Insurers reported that 75% of the Fortune 500 companies provide some level of remedial training for their workers. All over the U.S.A. 30 million (14% of adults) are unable to perform simple and everyday literacy activities. [1] 

In the UK, according to the Daily Telegraph (14 June 2006) "one in six British adults lacks the literacy skills of an 11-year-old". The UK government's Department for Education reported in 2006 that 47 percent of school children left school at age 16 without having achieved a basic level in functional mathematics, and 42 percent fail to achieve a basic level of functional English. Every year 100,000 pupils leave school functionally illiterate in the UK.[2]

France 9% functionally illiterate adults

Germany 11.2% functionally illiterate adults

 BTW all our so-called "developped" countries have quite high functionally illiterate rates. Shame on us.

List of countries by incarceration rate

Rank Country Prisoners per 100,000 population

1 United States of America 760

Total general government expenditure - (% of GDP) 2007

Sweden 52.5

France 52.3

Denmark 51.0

Hungary 49.7

Austria 48.7

Belgium 48.3

Italy 47.9

Finland 47.3

Portugal 45.8

Netherlands 45.3

Germany 44.2

Greece 44.0

United Kingdom 44.0

Czech Republic 42.6

Slovenia 42.4

Poland 42.1

Bulgaria 41.5

Norway 40.9

Spain 38.8

Romania 36.6

Ireland 35.7

US approx 35

Slovakia 34.4

Switzerland 32.2

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