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Daily Digest 7/12 - Let's Draft Our Kids, Roubini On "Global Perfect Storm"

Thursday, July 12, 2012, 9:54 AM

Economy

Let's Draft Our Kids (VeganD)

revived draft, including both males and females, should include three options for new conscripts coming out of high school. Some could choose 18 months of military service with low pay but excellent post-service benefits, including free college tuition. These conscripts would not be deployed but could perform tasks currently outsourced at great cost to the Pentagon: paperwork, painting barracks, mowing lawns, driving generals around, and generally doing lower-skills tasks so professional soldiers don’t have to. If they want to stay, they could move into the professional force and receive weapons training, higher pay and better benefits.

Report: Some lose homes over as little as $400 (Dana T.)

The rules for property tax sales can be confusing, especially to elderly people who can't keep track of their finances and people in minority-heavy communities that were targeted by subprime lenders. Here's how it works:

— The government files a public document called a tax lien saying that it can seize the property if the taxes remain unpaid.

Many Wall Street executives say wrongdoing is necessary: survey (Dana T.)

"When misconduct is common and accepted by financial services professionals, the integrity of our entire financial system is at risk," Jordan Thomas, partner and chair of Labaton Sucharow's whistleblower representation practice, said in a statement.

Why is Wall Street full of psychopaths? (Chris M.)

What are the symptoms of Wall Street psychopaths?

They "generally lack empathy and interest in what other people feel or think," writes DeCovny, who bases her report on interviews with several trade psychologists. Financial psychopaths are capable of displaying "an abundance of charm, charisma, [and] intelligence," but also possess an "unparalleled capacity for lying, fabrication, and manipulation."

The Impending World Oil Shortage: Learning from the Past (Jason C.)

While Congress debates who is responsible for the closing of 2,000 gas stations across the land and farmers cry that there is not enough fuel to move their tractors this summer, U.S. policy planners are worrying that the worse is yet to come – an absolute worldwide shortage of oil.

Three central banks take action in sign of alarm (Sonya P.)

The Bank of England, whose rates are already at a record low 0.5 percent, said it would restart its printing presses and buy 50 billion pounds ($78 billion) of assets with newly created money to help the economy out of recession.

Nouriel Roubini: “Global Perfect Storm” Leads To Event Worse Than 2008 (David B.)

When asked for his opinion about the best way to manage banker greed, criminal activity and immoral behavior, Roubini didn’t mince words, a refreshing departure from comments made by analysts dependent upon the Wall Street/Washington circle of friends for a paycheck. Criminal behavior should be punished through appropriate and sanctioned criminal proceedings, according to him. That assessment comes following Barclay’s ‘crime of the century’, in which, it appears no one will be criminally prosecuted for jury rigging an estimated $100 trillion worth of debt securities marked to LIBOR+.

Chart Of The Year: The Fed Has Doubled The S&P Admits... The Fed (garden09)

For many years, economists have struggled to explain the “equity premium puzzle”—the fact that the average return on stocks is larger than what would be expected to compensate for their riskiness. In this post, which draws on our recent New York Fed staff report, we deepen the puzzle further. We show that since 1994, more than 80 percent of the equity premium on U.S. stocks has been earned over the twenty-four hours preceding scheduled Federal Open Market Committee (FOMC) announcements (which occur only eight times a year)—a phenomenon we call the pre-FOMC announcement “drift.”

As Evidence Mounts, DC Insiders Worry About Holder's Inaction on Wall Street Crime (Thomas C.)

A growing number of people are privately expressing concern at the Justice Department's long-standing pattern of inactivity, obfuscation and obstruction. Mr. Holder's past as a highly-paid lawyer for a top Wall Street firm, Covington and Burling, is being discussed more openly among insiders. Covington & Burling was the law firm which devised the MERS shell corporation that has since been implicated in many cases of mortgage and foreclosure fraud.

San Bernadino, California Budget Report (Phil H.)

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."

7 Comments

saxplayer00o1's picture
saxplayer00o1
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rjs's picture
rjs
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Posts: 445
financial mismanagement on an epic scale.

 

The world desperately wants to loan us money, by Ezra Klein: The Financial Times reports that there was record demand for 10-year Treasurys this week. “The $21 [billion] sale of 10-year paper sold at a yield of 1.459 per cent, the lowest ever in an auction.” ...

Remember: Low yields means we’re getting the money for a cheap. It means the market thinks we’re a safe bet. And it means we have the opportunity to get capital for almost nothing and invest it productively.

Actually, I got something wrong there. I said “almost nothing.” But ... when you ... account for inflation, it’s not “almost nothing.” It’s “less than nothing.” ... They’re negative. Negative! The market will literally pay us a small premium to take their money and keep it safe for them for five, seven or 10 years. We could use that money to rebuild our roads and water filtration systems. We could use that money to cut taxes for any business that adds to its payrolls. We could use that to hire back the 600,000 state and local workers we’ve laid off in the last few years.

Or, as Larry Summers has written, we could simply accelerate payments we know we’ll need to make anyway. We could move up maintenance projects, replace our military equipment or buy space we’re currently leasing. All of that would leave the government in a better fiscal position going forward, not to mention help the economy.

The fact that we’re not doing any of this isn’t just a lost opportunity. It’s financial mismanagement on an epic scale.

 

pwoody82's picture
pwoody82
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What is your plan?

Tell me rjs, what is your plan when it comes time to pay the money back? Where will the money come from? Where are we going to get the 16 trillion the country currently owes along with the 60 trillion plus in unfunded liabilities like Medicare, Medicade, and Social Security which have already come due and have been or are being financed by such borrowing. The so called trust funds have no money in them, just promises to tax the citizenry which already cannot afford it. The day of reckoning is not far down the road.

saxplayer00o1's picture
saxplayer00o1
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Posts: 4066
Moody's cuts Italy by two notches to Baa2

Moody's cuts Italy by two notches to Baa2

redryder459's picture
redryder459
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http://www.nytimes.com/2012/07/10/opinion/lets-draft-our-kids.ht

I think Gen McCrystal has forgotten how hard we had to work to get folks out of the Army who were unfit for service. That was back when he was a Captain at Ft. Stewart, Ga. in 82-83. Then there is the meaningless little matter of the Constitution. You know, involuntary servitude.

UselessEater's picture
UselessEater
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OITW's picture
OITW
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Posts: 28
I worked for McChrystal for a

I worked for McChrystal for a few years.  A relentless hunter of men, yes.  Also a Harvard Kennedy School grad and a member of the Council on Foreign Relations.  In other words, his program is not ours, or at least not mine.  This proposal?  Better get those unemployed youth doing something before they figure out they've been screwed and turn on us.  Need a guy in uniform with impeccable creds to do it.  Just as before, McChrystal will take the heat as the front man for Petraeus.  Get your popcorn.

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