STOCK MARKET WATCH -- Tuesday, 14 August 2012

[Tansy_Gold]

[font size=3]STOCK MARKET WATCH, Tuesday, 14 August 2012[font color=black][/font]

SMW for 13 August 2012

AT THE CLOSING BELL ON 13 August 2012
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Dow Jones 13,169.43 -38.52 (-0.29%)
S&P 500 1,404.11 -1.76 (-0.13%)
[font color=green]Nasdaq 3,022.52 +1.66 (0.05%)


[font color=red]10 Year 1.66% +0.01 (0.61%)
30 Year 2.75% +0.01 (0.36%) [font color=black]


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[font size=2]Market Conditions During Trading Hours[/font]
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[font size=2]Euro, Yen, Loonie, Silver and Gold[center]

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[font color=black][font size=2]Handy Links - Market Data and News:[/font][/font]
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Economic Calendar
Marketwatch Data
Bloomberg Economic News
Yahoo Finance
Google Finance
Bank Tracker
Credit Union Tracker
Daily Job Cuts
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[font color=black][font size=2]Handy Links - Economic Blogs:[/font][/font]
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The Big Picture
Financial Sense
Calculated Risk
Naked Capitalism
Credit Writedowns
Brad DeLong
Bonddad
Atrios
goldmansachs666
The Stand-Up Economist
The Automatic Earth
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[font color=black][font size=2]Handy Links - Government Issues:[/font][/font]
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LegitGov
Open Government
Earmark Database
USA spending.gov
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[font color=black][font size=2]Handy Links - Videos:[/font][/font]
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Charlie Rose talks with Roubini
Charlie Rose talks with Krugman
William Black: This Economic Disaster
Bill Moyers with Kevin Drum and David Corn
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[font color=red]Partial List of Financial Sector Officials Convicted since 1/20/09 [/font][font color=red]
2/2/12 David Higgs and Salmaan Siddiqui, Credit Suisse, plead guilty to conspiracy involving valuation of MBS
3/6/12 Allen Stanford, former Caribbean billionaire and general schmuck, convicted on 13 of 14 counts in $2.2B Ponzi scheme, faces 20+ years in prison
6/4/12 Matthew Kluger, lawyer, sentenced to 12 years in prison, along with co-conspirator stock trader Garrett Bauer (9 years) and co-conspirator Kenneth Robinson (not yet sentenced) for 17 year insider trading scheme.
6/14/12 Allen Stanford sentenced to 110 years without parole.
6/15/12 Rajat Gupta, former Goldman Sachs director, found guilty of insider trading. Could face a decade in prison when sentenced later this year.
6/22/12 Timothy S. Durham, 49, former CEO of Fair Financial Company, convicted of one count conspiracy to commit wire and securities fraud, 10 counts of wire fraud, and one count of securities fraud.
6/22/12 James F. Cochran, 56, former chairman of the board of Fair, convicted of one count of conspiracy to commit wire and securities fraud, one count of securities fraud, and six counts of wire fraud.
6/22/12 Rick D. Snow, 48, former CFO of Fair, convicted of one count of conspiracy to commit wire and securities fraud, one count of securities fraud, and three counts of wire fraud.
7/13/12 Russell Wassendorf Sr., CEO of collapsed brokerage firm Peregrine Financial Group Inc. arrested and charged with lying to regulators after admitting to authorities he embezzled "millions of dollars" and forged bank statements for "nearly twenty years."




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[font size=3][font color=red]This thread contains opinions and observations. Individuals may post their experiences, inferences and opinions on this thread. However, it should not be construed as advice. It is unethical (and probably illegal) for financial recommendations to be given here.[/font][/font][/font color=red][font color=black]

[Demeter]

1. That cartoon REALLY fits my mood.

We are all so screwed.

[DemReadingDU]

26. Same here

And I can't get anyone to understand why my mood is so dark.

I tried, again, to explain to spouse that things can't continue the way they have for the past few decades, it isn't normal. His response is that this is what people are used to.

I believe AnneD calls this the 'Normalcy bias'
http://www.democraticunderground.com/?com=view_post&forum=1116&pid=2368

[Demeter]

2. How Badly Does Wall Street Want A Romney Presidency?

http://www.zerohedge.com/category/tags/algorithmic-trading

Does Wall Street really want a Romney Presidency?

Or could Wall Street not care less, because they know that both sides will gladly do their bidding?

After all it’s not like Obama has tried to jail corrupt bankers — Corzine, who after raiding segregated accounts is surely up there with the most corrupt guys on Wall Street — has been bundling for Obama as recently as April.

Ignore the chickenshit donations.

If markets fall significantly between now and November — 1300, 1200, 1100, 1000 — the powers that be on Wall Street want a Romney presidency. After all, it’s not only possible but extremely easy to deliberately crash the market. No S&P crash? They’re happy to stick with Obama.

I REALLY HATE TO THINK WHAT KIND OF STUPID "GIMMES" ARE GOING ON OVER THIS WHITE HOUSE.

ALL THESE FUCKERS SHOULD BE SHOT FOR TREASON.

[Demeter]

3. The Fourth Turning BY William Strauss and Neil Howe

http://www.zerohedge.com/contributed/2012-08-13/fourth-turning-finally

It is... a fifteen-year old book, http://www.amazon.com/gp/product/0767900464/ref=as_li_tf_tl?ie=UTF8&camp=1789&creative=9325&creativeASIN=0767900464&linkCode=as2&tag=prophet-20

and I imagine much of it was written around 1995 or so, during the feel-good Clinton years. When the book came out in 1997, the authors made clear that they were currently in the Third Turning, and that the Fourth Turning - the final quarter of a cycle that they postulate recurs throughout modern human history - was coming around 2005 or so.

Strauss and Howe write:

Over the past five centuries, Anglo-American society has entered a new era - a turning - every two decades or so....Together the four turnings of the saeculum comprise history's seasonal rhythm of growth, naturation, entropy, and destruction:

+ The First Turning is a High; an upbeat era of strengthening instutitions and weakening individualism;

+ The Second Turning is an Awakening, a passionate era of spirtual upheaval, when the civic order comes under attack from a new values regime;

+ The Third Turning is an Unraveling, a downcast era of strrengtening individualism and weakening institutions;

+ The Fourth Turning is a Crisis, a decisive era of secular upheaval, when the values regime propels the replacement of the old civic order with a new one.

As they anticipated the next "Turning", they referenced its start point around 2005, in the middle of the "Oh-Oh" decade (which I've now heard referred to as the "Naughts&quot :

The next Fourth Turning is due to begin shortly after the new millenium, midway through the Oh-Oh decade. Around the year 2005, a sudden spark will catalyze a Crisis mood...Political and economic trust will implode...severe distress that could involve questions of class, race, nation, and empire...the very survival of the nation will feel at stake. Sometime before the year 2025, America will pass through a great gate in history, commensurate with the American Revolution, Civil War, and twin emergencies of the Great Depression and World War II.

I would suggest, and I'm sure many would agree, that the attacks of 9/11 were the "sudden spark". Early in the book, the authors describe how there have, through human history, been three general ideas about the path of time in our lives - chaotic, cyclical, linear. The entire basis of the book is that the cyclical perception of the world is the accurate one, and the human species continues to move its way through this quartet of cycles, totalling about the length of a human life, called a Saeculum. We are presently in The Millennial Saeculum, which is broken down into these four parts:

+ The American High (1946-1964);

+ The Consciousness Revolution (1964-1984);

+ The Culture Wars (1984-2005?);

+ The Millennial Crisis (which, when the book was published, was yet to arrive)

If you consider the four quarters of a Saeculum to the time "axis" of the grid, the other is made of the human archetypes, whose character depends on their generation as well as what portion of the Saeculum is currently running. The present archetypes are described as follows:

+ The Boom Generation (Prophet archetype, born 1943-1960);

+ The 13th Generation (Nomad archetype, born 1961-1981);

+ The Millennial Generation (Hero archetype, born 1982-?);

+ The Artist archetype is being born now

I'm a member of what they dub the 13th Generation, so-called simply because it is the 13th generation of Americans that they track.

Many of the predictions about the near-future that were offered are eerily accurate, whereas others are embarassingly wrong, such as the supposition that, to celebrate the year 2000, "Others will board a chartered Concorde just after midnight and zoom back through time from the third millennium to the second." Of course, I can't fault the authors for not anticipating the fiery end of the Concorde fleet!

I am, of course, most interested in the Crisis era, since that is supposedly what we're in the midst of living; the authors declare the Crisis can be constructed with this morphology:

+ A Crisis era begins with a catalyst - a startling event (or sequence of events) that produces a sudden shift in mood

+ Once catalyzed, a society achieves a regeneracy - a new counter-entropy that reunifies and reenergizes civic life.

+ The regenerated society propels toward a climax - a crucial moment that confirms the death of the old order and birth of the new.

+ The climax culminates in a resolution - a triumphant or tragic conclusion that separates the winners from losers, resolves the big public questions, and establishes the new order

Here again, I would think most would agree the 9/11 attacks would serve the definition of "catalyst" quite well. As the book draws to a close, it delves into greater detail about what could be forthcoming from the perspective of someone writing in 1997. I've emphasized a few items in bold:

Sometime around the year 2005, perhaps a few years before or after, America will enter the Fourth Turning.....a spark will ignite a new mood...In retrospect, the spark might seem as ominous as a financial crash, as ordinary as a national election, or as trivial as a Tea Party......the following circa-2005 scenarios might seem plausible:

+ A global terrorist group blows up an aircraft and announces it possesses portable nuclear weapons......Congress declares war.....Opponents charge that the president concocted the emergency for political purposes.

+ An impasse over the federal budget reaches a stalemate. The President and Congress both refuse to back down, triggering a near-total government shutdown.....Congress refuses to raise the debt ceiling. Default looms. Wall Street panics.

As superb as these projections were, the authors hasten to add - ironically - "It's highly unlikely that any one of these scenarios will actually happen." On the contrary, these guesses about the future (which, let's face it, required the authors to really go out on a limb) were excellent. They continue (although I am using ellipses to replace large chunks of text, since I'm not in the mood to re-type an entire book):

Time will pass, perhaps another decade, before the surging mood propels America to the Fourth Turning's grave moment of opportunity and danger: the climax of the Crisis.....the molten ingredients of the climax, which could include the following:

+ Economic distress, with public debt in default, entitlement trust funds in bankruptcy, mounting poverty and unemployment, trade wars, collapsing financial markets, and hyperinflation (or deflation)

+ Social distress....

+ Cultural distress......

+ Technology distress, with cryptoanarchy, high-tech oligarchy, and biogenetic chaos

+ Ecological distress....

+ Political distress....

+ Military distress.......

This is a thoughtful, well-articulated, and engrossing book. As with any text that makes broad sociological assertions and generalizations, the authors have opened themselves up to plenty of criticism about the plausibility of their prophecy. Taken as a whole, I think this book provide an enlightening blueprint of both the present and the near-future. I strongly recommend it.

The Strauss-Howe generational theory, created by historians William Strauss and Neil Howe, identifies a recurring generational cycle in American history. Strauss and Howe lay the groundwork for the theory in their 1991 book Generations, which retells the history of America as a series of generational biographies going back to 1584. In their 1997 book The Fourth Turning, the authors expand the theory to focus on a fourfold cycle of generational types and recurring mood eras in American history.

The theory was developed to describe the history of the United States, including the 13 colonies and their Anglo antecedents, and this is where the most detailed research has been done. However, the authors have also examined generational trends elsewhere in the world and identified similar cycles in several developed countries. Academic responses to the authors have been mixed—some applauding Strauss and Howe for their "bold and imaginative thesis," and others criticizing them for their unrepresentative sampling methods.

History

Strauss and Howe’s partnership began in the late 1980s, when they began writing the book Generations, which tells the history of America as a succession of generational biographies from 1584 to the present. Each had previously written on generational topics: Strauss on Baby Boomers and the Vietnam War draft, and Howe on the G.I. Generation and federal entitlement programs.[6] The authors’ interest in generations as a broader topic emerged after they met in Washington, DC, and began discussing the connections between each of their previous work.

They wondered why Boomers and G.I.s had developed such different ways of looking at the world, and what it was about these generations’ growing up experiences that prompted their different outlooks. Strauss and Howe also wondered whether any previous generations had acted along similar lines, and their research showed that there were indeed historical analogues to the current generations. The two ultimately identified a recurring pattern in Anglo-American history of four generational types, each with a distinct collective persona, and a corresponding cycle of four different types of era, each with a distinct mood. The groundwork for this theory was laid out in Generations in 1991. Strauss and Howe expanded on the theory and updated the terminology in The Fourth Turning in 1997.

Generations helped popularize the idea that people in a particular age group tend to share a distinct set of attitudes and behaviors because they all grow up and come of age during a particular period in history. In the mid-1990s, the authors began receiving inquiries about how their generational insights could help solve strategic problems in organizations. Strauss and Howe were quickly established as pioneers in a growing field, and started speaking frequently about their work at events and conferences.

In 1999, Strauss and Howe founded LifeCourse Associates, a publishing, speaking, and consulting company built on their generational theory. As LifeCourse partners, they have offered keynote speeches, consulting services, and customized communications to corporate, nonprofit, government, and education clients. They have also written six books on how the Millennial Generation is transforming various sectors, including schools, colleges, entertainment, and the workplace.

On 18 December 2007, William Strauss died at the age of 60 from pancreatic cancer. Howe has continued to expand LifeCourse Associates and to write books and articles on a variety of generational topics. Each year Mr. Howe gives about 60 speeches, often followed by customized workshops, at colleges, elementary schools, and corporations....WIKIPEDIA

[Demeter]

4. Like everything else, it even has a website

http://www.fourthturning.com/

and a bunch of fora that puts DU3 to shame...

http://www.fourthturning.com/forum/index.php

[Demeter]

5. Apocalypse Now: Do We Have A Global Death Wish?

http://www.alternet.org/apocalypse-now-do-we-have-global-death-wish?akid=9203.227380.LVtRnB&rd=1&src=newsletter691462&t=13&paging=off

It's the end of the world as we know it. And some of us are really looking forward to it....Suppose Europe’s debt crisis leads to a fracturing of the eurozone and the ripple effect leads to a global depression worse than the one we’re slowly climbing out of. And suppose as a result of the economic chaos, there are riots in Europe and the U.S., with right-wing militias in a near civil war with failing governments, mass disruptions in the food supply, perhaps even global economic collapse and a breakdown of the social order...Somewhere in that chain of events, most readers stopped supposing. But many others, if the statistics are right, are still with me, and might go further still, envisioning a massive breakdown and/or revolution in the world order, in very short time.

The latter view is a secular form of millennialism, the scholarly term for the belief that a wholesale transformation of the world, for better or for worse, is imminent. And as two massive new tomes, Richard Landes’ Heaven on Earth and the The Oxford Handbook of Millennialism edited by Catherine Wessinger, very helpfully demonstrate, our own beliefs and fears about politics, economics, and the environmental crisis, are not so distant from ancient apocalyptic prophecies about the end of the world, the Second Coming, or the rapture. Sure, our anxieties may be grounded in ‘facts,’ but the ancients thought theirs were too. What’s more important is the pattern of millennial thinking, which has always been with us and, unless the world is about to end, likely always will be...The term “millennialism” does not refer to the year 2000, or the turning of the millennium. Rather, it takes its misleading name from the Christian belief that Christ will return to Earth and rule for one thousand years. The apocalypse, rapture, Second Coming—these are specific events in specific forms of millennial ideology. Millennialism itself is, in Wessinger’s definition, “the audacious hope that in the imminent future there will be a transition—either catastrophic or progressive—to a ‘collective salvation’ which will be accomplished by a divine or superhuman agent and/or by humans working in accordance with a divine or superhuman plan.” Following the pioneering scholar of millennialism Norman Cohn, Wessinger states that the millennialist salvation is collective, earthly (i.e., it will happen in this world), imminent, transformative, and supernaturalist in nature.

The twenty cultural studies in the Oxford volume and the dozen in Landes’ book make this point clear: millennialism is a pattern of human thinking that is universal, and depends little on whether the “superhuman plan” is polytheistic, monotheistic, or atheistic in nature. Our fears about Y2K (remember that?) and New Age predictions about December 21 of this year are not different in kind from Harold Camping’s ridiculous (and widely ridiculed) “calculation” that the apocalypse would take place on May 21 (and then October 21) of last year. Nor, claims Landes, are utopian claims of a transformed economic or political order, such as Shimon Peres’ now nostalgic vision of a “new Middle East” or a jihadist’s vision of a purified umma. Even clocking in at 500 pages, Landes’ book is only half a volume, for it consciously does not deal with the best-known forms of millennialism: Christian and Jewish ones. This is like writing about soft drinks without mentioning Coca Cola. Yet the dozen cases Landes studies in depth, ranging from the 1856 Xhosa Cattle-Slaying to Marxism and Global Jihad, offer a series of mirrors through which to see more familiar religious and secular movements alike. It’s easy to say that millennialism is for the weird and wacky; it’s quite another to recognize millennial thinking in our own minds.

Of course, concurrent with the view that the world is soon to be greatly transformed is the notion that we ought to do something about it. Some of these actions are harmless, or may have positive side effects; growing one’s own food, for example, out of fear of global economic collapse. And what Wessinger calls “progressive millennialism” may be nothing more than the belief that humanity is (or should) be evolving toward a more just and peaceful future. But others are downright sinister: 9/11, UFO cults preparing to be taken away, the Jehovah’s Witnesses selling their property prior to the 1974 rapture, the Millerites (the parent sect of today’s Seventh Day Adventists) going up on a hill to await the second coming on October 22, 1844, up to one-third of European Jews preparing to move to the Land of Israel with the messiah Sabbetai Zevi in 1666, the Xhosa slaughtering their animals and committing a kind of national suicide, the Nazis exterminating the Jews, the Aum Shinrikyo sect gassing people in the Tokyo subway—once millennial beliefs take hold, they inspire the strongest of human actions, often at terrible cost.... For example, within the evangelical world—which, let’s remember, includes between 30% and 40% of all Americans—there is a split between postmillennialists, who believe that Christ’s peaceful reign on Earth will follow a gradual improvement in human life, and the more familiar premillennialists, who believe that Christ will suddenly come back, destroy the current order, and replace it with a new one. From a progressive perspective, both of these views can be problematic. Many postmillennialists insist that we must transform America into a theocracy before Christ can come again, and are devoting considerable resources to doing so (which, of course, means oppressing women and sexual minorities). Many premillenialists, on the other hand, are so pessimistic that they are pursuing what some of us might consider a self-fulfilling prophecy of doom. Many Christian Zionists, for example, believe that a massive war in the Middle East is unavoidable, imminent, and part of the divine plan for humanity—and are supporting policies that raise the probability of just such a war...

[newfie11]

27. K for later read

[Fuddnik]

34. Then, there's always the happy ending.

Extinction of all life on Earth scheduled for 2031-2051

Last edited Sun Aug 12, 2012, 07:01 PM USA/ET - Edit history (1)

Abstract

Although the sudden high rate Arctic methane increase at Svalbard in late 2010 data set applies to only a short time interval, similar sudden methane concentration peaks also occur at Barrow point and the effects of a major methane build-up has been observed using all the major scientific observation systems. Giant fountains/torches/plumes of methane entering the atmosphere up to 1 km across have been seen on the East Siberian Shelf. This methane eruption data is so consistent and aerially extensive that when combined with methane gas warming potentials, Permian extinction event temperatures and methane lifetime data it paints a frightening picture of the beginning of the now uncontrollable global warming induced destabilization of the subsea Arctic methane hydrates on the shelf and slope which started in late 2010. This process of methane release will accelerate exponentially, release huge quantities of methane into the atmosphere and lead to the demise of all life on earth before the middle of this century.



http://arctic-news.blogspot.com/p/global-extinction-within-one-human.html

It takes more energy to melt ice than it takes to heat water once the ice is melted. After the arctic ice is gone (in 2015-2017) the heating of the arctic water will increase exponentially, releasing more methane, and putting in motion a positive feedback loop that will mean the end of all life on Earth by mid-century.


http://www.democraticunderground.com/112721718

[DemReadingDU]

43. I read something similar elsewhere

Scary.

Now there is no reason to clean my house. Well all be extinct and no one will see the dirt.

[Ghost Dog]

86. I'll jump in here: L. Cohen interview (+ 2hr concert)... "Life, Death, Women... Taxes."

The full castrophe. (cf. Zorba).

PLUS: Something about Seferad:

http://www.rtve.es/alacarta/videos/entre2aguas/entre2aguas-capitulo-10/1269434/

[Demeter]

6. A moment of peace and hope--it's raining, gently

I am hopeful that the drought has broken for Michigan, at least.

[Demeter]

7. Missing in the Welfare Debate: Reform is Dependent on Full Employment By Ryan Cooper

WELL, EITHER FULL EMPLOYMENT, OR GENOCIDE....UNFORTUNATELY, I SUSPECT THEY ARE PLANNING ON GENOCIDE...

http://www.alternet.org/hot-news-views/missing-welfare-debate-reform-dependent-full-employment?akid=9201.227380.mNRn3F&rd=1&src=newsletter691067&t=30

When welfare reform was implemented back in the nineties, the idea was that if people on welfare are incentivized to work, they can be slowly moved into the workforce and off the government rolls. Liberals liked it because it seemed like a technocratic, free-markety way to get people out of poverty, and conservatives liked it because they think everyone on welfare are dependent parasites who just don’t know the value of a hard day’s work and don’t deserve any government money. (Traditionally, this is loaded with a lot of race-baiting about “welfare queens,” “strapping young bucks,” etc.)

For awhile in those high-velocity times, it seemed to work. Welfare rolls plunged, and the unemployment rate crept lower and lower. Hooray, bipartisan success. Left unsaid in the whole formulation for welfare reform is that it is utterly dependent on full employment to have even a chance to work. That is, it has to be the case that (roughly speaking) everyone who makes an honest effort to find a job can get hired. But there are times when that isn’t the case: depressions, when there are way more job-seekers than jobs for a prolonged period. That ratio has been over 4.3 for 29 consecutive months.

Welfare recipients, in general, are at the back of the employment line. If there are four people apiece ahead of them after four years, it is mechanically impossible they’ll be employed in significant numbers. All the incentives in the world are only going to result in people rooting through the trash for recycling, selling their blood plasma, and their children starving.

True to form, conservatives are uninterested in the actual outcomes of any policy. Instead, they remain fixated on government policy making the correct moral gesture. Welfare recipients, they say, though welfare rolls have plummeted even in the midst of a depression, are even lazier than ever. Romney’s new ad is a lying, Nixonian, race-baiting throwback darkly insinuating about how those people are getting free money from the government. (It would be nice, by the way, if Obama would stop embracing the conservative frame on this.) If I had my druthers I’d pick full employment before fixing welfare, because it would help the poor and everyone else at once. But since we’ve picked depression, it is monstrous to have children growing up hungry and stunted in the richest country on earth.

Washington Monthly http://www.washingtonmonthly.com/

[Demeter]

8. Obama Surrenders to Goldman Sachs

http://www.alternet.org/obama-surrenders-goldman-sachs?akid=9201.227380.mNRn3F&rd=1&src=newsletter691067&t=15

Rarely does one see a more perfect illustration of the Obama administration’s tortured relationship with Wall Street:

On August 9, the Justice Department and the SEC both announced the end of investigations into potential criminal behavior related to Goldman’s handling of mortgage-backed securities in the runup to the financial crisis.

That same day, the Center for Responsive Politics reported that Goldman employees had switched from giving 75 percent of their campaign donations to Democratic candidates in 2008 to giving 70 percent of of their donations to Republicans in 2012.

That’s called having your mortgage fraud cake and eating it too.

Whether motivated by sheer pique at Obama’s mildly derogatory comments about “fat cat” bankers, or annoyed by his calls to raise their taxes back to the perilous heights of the Clinton years, or simply incensed at Dodd-Frank’s potential inroads against Goldman’s profit machine, the much-put upon employees of the world’s most famous investment bank are giving Democrats the cold shoulder. And at the very same time, a Democratic administration is sending up the white flag of surrender, acknowledging that it simply can’t bring Wall Street to account for its misdeeds before and during the financial crisis.

And misdeeds there were. The 635-page Levin-Coburn report on the financial crisis released in April 2011 makes that clear beyond any reasonable doubt. Goldman knew that the mortgage-backed securities it was packaging together were crap, sought out suckers to sell the trash too, and cashed in by betting that the products they were packaging and selling off would implode in value. Sure, everyone on Wall Street was engaged in the same games — the big difference with Goldman was that they were much, much better at it, and got out while the getting was still good.

Unfortunately, what seems clearly obvious to the normal person does not appear to translate into a slam-dunk court case, in the judgment of Department of Justice prosecutors faced with the daunting prospect of tackling the best-money-can-buy legal defense sure to be marshaled by Goldman. There’s surely a nugget of truth there — Wall Street did a very effective job in the 80s and 90s of ensuring that the rules governing their behavior were as lax as possible. But it still feels pusillanimous. And the cowardice completes a circle — because one of the key reasons why Goldman’s campaign contributions are now flowing to Romney is his promise to repeal the Obama administration’s primary effort to prevent future financial sector misbehavior — Dodd-Frank.

[Fuddnik]

42. Who doesn't he surrender to?

If there weren't clearer cases of participating in a "Continuing Criminal Enterprise", under the RICO statutes (which has no statute of limitations), I don't know where you would find them. You can also seize all of their assets under the statute, and let them fight for 40 years not to get them back. Just like they do to Grandma who got caught selling nickel bags of pot to supplement her catfood.

When yo only make them give back 10% of their ill-gotten gains as punishment, that's no deterrent, it's an incentive.

Seize it all, plus more, and pass out a few FRSP's. That'll work.

[Demeter]

47. No Surrender to Reason or Ethics to Date

and certainly not to Progressives!

Unfortunately, I doubt that it will ever come to the White House being RICO'd as it should be.

[Demeter]

9. Liberate! The Radical New Movement You Need to Know About

http://www.alternet.org/activism/liberate-radical-new-movement-you-need-know-about?akid=9201.227380.mNRn3F&rd=1&src=newsletter691067&t=9&paging=off

...A housing liberation movement is brewing in Chicago. The idea is simple: Tens of thousands — possibly hundreds of thousands — of vacant, bank-owned homes are a large part of what is making the poorest neighborhoods of Chicago into semi-forsaken tracts ridden with crime and blight. These houses are so bad that Mayor Rahm Emanuel recently announced that he’d spend $4 million just to tear some down. Meanwhile, there are more than 20,000 homeless adults and tens of thousands of additional homeless youth in the city fighting through life as capitalism’s refugees. (They aren’t receiving any additional mayoral funding.) The supposed truism of supply and demand seems to have gone haywire. Many no longer recognize the banks’ claim to ownership. The only definition of these so-called assets that makes sense is their immediate capacity to serve as homes for families.

“This is how we can house the city of Chicago,” said Thomas Turner, who has worked with Occupy Chicago and was homeless before he liberated and renovated four homes since the summer began. When a local property owner saw what Turner was during, she donated three more.

“You know this economic situation isn’t getting any better,” he continued. “So just like Harriet Tubman, Marcus Garvey, MLK — all the people that stepped in and made our lives better today, we’re working for — how do you say it? Our living aspects of life. It’s a domino effect — and when it all falls down, we’re going to have a big beautiful design.”

The liberation movement is organized into a loosely connected network of cells that collaborate — and compete — to see how many houses they can free from bank control and open for homeless families, particularly single women with children. There’s no official count of liberated houses in Chicago to date, but there are well over 25, maybe more than 50. The majority of organizers are themselves currently or formerly homeless, working under a variety of banners, including the Chicago Anti-Eviction Campaign, a group that grew out of the Cabrini Green housing project, and Take Back the Land, a national network centered on making housing a human right. Other groups choose to operate under the radar of media attention (a choice I have respected by keeping participants and their actions anonymous). Some hold no organizational affiliation; they are just members of the community who see this work as the best hope to save their city....Since 2008, the housing liberation movement has been building nationally, with actions in Miami, Madison, Detroit, Raleigh, New York and other cities. Nowhere has it expanded as rapidly as in Chicago, though, where various factors have made it the leading place for home liberation. Firstly, 55 percent of the city’s adult African American men have been branded as felons for life, barring them from access to public housing and often private housing as well....

[Demeter]

10. $25 Billion Mortgage Lending Settlement Failing Miserably

http://www.alternet.org/hot-news-views/25-billion-mortgage-lending-settlement-failing-miserably?akid=9199.227380.aitGnv&rd=1&src=newsletter690823&t=14



Last winter’s highly touted $25 billion settlement between state attorneys general and the country’s largest home mortgage lenders has utterly failed to help distressed borrowers, a coalition of progressive advocates said Thursday, saying federal bank regulators and the biggest banks have obstructed efforts to restructure loans and revive the economy.

“Housing is an essential part of our economy. Housing finance is an essential part of our economy. All of this is disrupted because of what the banks did and what the banks got away with, and what remains absolutely problematic about their behaviors and their procedures,” said Simon Johnson, an ex-Intentional Monetary Fund Chief Economist, speaking Thursday at a press conference for Campaign for Fair Settlement.

“Just from a point of view from repsonsible economic policy, of resuming growth and generating jobs, we need a full, fair and complete settlement around everything to do with mortgages and all the misbehavior os financial institutions in the run up to 2008, and in terms of what they did after the crisis broke.”

But that accounting has not only not happened, according to the homeowner advocates, the situation for distressed borrowers arguably has become worse in the six months since the nation’s attorney’s general announced their nationwide settlement with the banks....

[Demeter]

11. Almost Half of Americans Die Close to Penniless

http://www.alternet.org/hot-news-views/sobering-almost-half-americans-die-close-penniless?akid=9180.227380.0pRWOd&rd=1&src=newsletter689054&t=31

A new economic study has found that nearly half of Americans reach the end of their lives with virtually no assets, relying entirely on government programs like Social Security, Medicare and Medicaid. The results indicate that any changes to these safety net programs would indeed threaten the welfare of older Americans.

From MIT (h/t Huffpo):

Indeed, about 46 percent of senior citizens in the United States have less than $10,000 in financial assets when they die. Most of these people rely almost totally on Social Security payments as their only formal means of support, according to the newly published study, co-authored by James Poterba of MIT, Steven Venti of Dartmouth College, and David A. Wise of Harvard University.


That means many seniors have almost no independent ability to withstand financial shocks, such as expensive medical treatments that may not be covered by Medicare or Medicaid, or other unexpected, costly events.

Given the costs of funerals, it's fair to say that less than $10,000 is virtually penniless. The study also confirmed, but couldn't pinpoint, the relationship between wealth and longevity:

The study also revealed a “strong correspondence” between wealth in 1993 and the length of time that people lived. That relationship held true across a variety of asset classes: People whose homes were worth more, who had larger retirement incomes, and who had more financial savings all tended to live longer than those who had fewer assets.

While there is, Poterba observes, a “very active debate” among social scientists about the precise causal relationship between wealth and health, the study helps confirm, he notes, that “the patterns of health status in these years are quite persistent.”

Finally, the replacement of fixed-pension plans with 401Ks may make this situation even more dire in the future, as market fluctuations hurt individual finances.

[Po_d Mainiac]

12. Someone got pushed to far?

snip
College Station city spokesman Jay Socol said authorities were still investigating Caffall's background. It was unclear whether Caffall was renting the home or was being evicted for nonpayment of a mortgage, he said.

More at link
http://www.reuters.com/article/2012/08/14/us-usa-texas-shooting-idUSBRE87C0V220120814?feedType=RSS

[Fuddnik]

46. An example of really smart Republican planning.

Make sure that the people you're about to screw are armed to the teeth. They'll only use those guns to hunt deer and squirrels after you've taken their life's work away from them and they're homeless.

[Demeter]

13. humor from dilbert--I think we need some

[Demeter]

14. The Downgrade A Year Later By Ed Kilgore

http://www.alternet.org/progressive-wire/downgrade-year-later?akid=9172.227380.Jdb5Zr&rd=1&src=newsletter688063&t=16


Remember the famous Standard and Poor's downgrade of the U.S. federal government's credit rating? You know, the incident a year ago that, depending on your point of view represented (a) a warning to gridlocked politicians in both parties to get their act together on long-range budget decisions, (b) a protest against a profligate government heading in the direction of debt-strapped Greece, or (c) a highly irresponsible act of partisanship by a rating agency with a really bad recent record.

[xchrom]

15. 2a.m. wake up calls 2 days in a row

[Demeter]

35. Think about all those people who don't wake up...

lucky sods.

[xchrom]

16. German Provinces Struggle to Lure Skilled Workers

http://www.spiegel.de/international/germany/german-provinces-struggle-to-lure-southern-european-workers-a-849778.html

he potential pillars of the German economy arrived on Ryanair flight FR 5406 from Madrid, which landed on time at Eindhoven Airport in the southern Netherlands. Then, in pouring rain, they traveled by minibus to the northwestern German town of Papenburg. Upon arrival, they learned that northern Germany and southern Spain are very different places, and not just in terms of climate.

When the 15 young men and women from Murcia and Albacete in southeastern Spain completed "taster" internships in German companies in May, they also found out what people in northern Germany do in their free time. Together with local business owners and politicians, they went on bike trips between the villages of Sögel and Haselünne, and they even attended a tractor-pulling contest on a field in nearby Harpendorf.
The hosts did their best to show the young Southern Europeans a good time, as part of an effort to convince them to begin vocational training programs in the northern German regions of Emsland and East Frisia. The economy in the region along the A 31 autobahn, known locally as the Friesenspiess, has been growing for years.

Metal-processing businesses and construction contractors have many orders, and the companies need more workers. "We can't find enough personnel here, so we're trying to convince young Spaniards and Portuguese to come to our region to live and work," says Dirk Lüerssen, managing director of "Ems-Axis Growth Region," an economic development initiative. Lüerssen began his search in Murcia and Albacete, where one in three people is unemployed.

[xchrom]

17. Investors Prepare for Euro Collapse

http://www.spiegel.de/international/business/investors-preparing-for-collapse-of-the-euro-a-849747.html

Otmar Issing is looking a bit tired. The former chief economist at the European Central Bank (ECB) is sitting on a barstool in a room adjoining the Frankfurt Stock Exchange. He resembles a father whose troubled teenager has fallen in with the wrong crowd. Issing is just about to explain again all the things that have gone wrong with the euro, and why the current, as yet unsuccessful efforts to save the European common currency are cause for grave concern.

He begins with an anecdote. "Dear Otmar, congratulations on an impossible job." That's what the late Nobel Prize-winning American economist Milton Friedman wrote to him when Issing became a member of the ECB Executive Board. Right from the start, Friedman didn't believe that the new currency would survive. Issing at the time saw the euro as an "experiment" that was nevertheless worth fighting for.
Fourteen years later, Issing is still fighting long after he's gone into retirement. But just next door on the stock exchange floor, and in other financial centers around the world, apparently a great many people believe that Friedman's prophecy will soon be fulfilled.

Banks, investors and companies are bracing themselves for the possibility that the euro will break up -- and are thus increasing the likelihood that precisely this will happen.

[Demeter]

36. Definition of Insanity applies here

[xchrom]

18. FRENCH ECONOMY SEES ZERO GROWTH IN Q2

http://hosted.ap.org/dynamic/stories/E/EU_FRANCE_FINANCIAL_CRISIS?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2012-08-14-04-54-51

PARIS (AP) -- France's economy was stagnant in the second quarter, the government said Tuesday, amid worries that Europe's No. 2 economy is hovering on the edge of a new recession.

The preliminary estimates released Tuesday by the state statistics agency Insee mark the third straight quarter without growth.

The figures were in line with Insee's earlier forecast for no growth in domestic product for the quarter. But they were better than estimates by France's central bank, which had forecast a 0.1 percent contraction in the second quarter and a continued drop in the third quarter.

Finance Minister Pierre Moscovici expressed hope for growth in the second half of the year despite the lackluster first half. Speaking on Europe-1 radio, he acknowledged that the economy is "too weak" but stressed that France is staying stable even as "most of its partners" are in recession, including Spain, Italy and Britain.

[xchrom]

19. GERMAN ECONOMY GROWS 0.3 PERCENT IN Q2

http://hosted.ap.org/dynamic/stories/E/EU_GERMANY_ECONOMY?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2012-08-14-03-43-09

BERLIN (AP) -- Germany's economy, Europe's largest, grew a larger-than-expected 0.3 percent in the second quarter from the previous three-month period as consumer spending and strong exports helped stave off effects of Europe's debt crisis, the Federal Statistical Office said Tuesday.

The consensus in the markets was that Germany's economy would grow by only 0.2 percent during the quarter, down from the 0.5 percent recorded in the first three months of the year.

A clearer breakdown of the quarterly performance will not emerge until later this month. However, the statistics office said exports and public consumption combined with lower unemployment to lift growth. One downbeat indicator was a fall in investment in machinery and equipment, a possible sign that firms are getting less confident about the future.

"The economy remains the stronghold of the eurozone -however, another strong quarter merely glosses over the fact that even the stronghold has already caught the euro crisis virus," said Carsten Brzeski, an economist with ING bank in Brussels.

[xchrom]

20. IOWA BROKERAGE CEO INDICTED IN $200M FRAUD SCHEME

http://hosted.ap.org/dynamic/stories/U/US_FAILED_BROKERAGE_INDICTMENT?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2012-08-13-19-23-58

IOWA CITY, Iowa (AP) -- The founder of a bankrupt Iowa-based brokerage was indicted by a federal grand jury Monday on 31 counts of making false statements to regulators in connection with a $200 million fraud scheme.

Peregrine Financial Group Inc. CEO Russ Wasendorf Sr. could face up to 155 years in prison if convicted on all counts, prosecutors said. His attorney didn't immediately return a phone message Monday, and the date for an arraignment, where Wasendorf will enter a plea, has not been set.

Wasendorf, 64, was arrested last month while hospitalized in Iowa City following a failed suicide attempt outside Peregrine's office in Cedar Falls. Authorities said Wasendorf left a detailed suicide note in which he confessed to a 20-year scheme to commit fraud and embezzle customer funds.

Regulators said Wasendorf's company cannot account for more than $200 million in customer funds that it was supposed to be holding. Peregrine has filed for bankruptcy and is liquidating its assets, meaning more than 24,000 customers who used the company to invest in commodities ranging from corn to gold don't have access to their funds.

[xchrom]

21. Fear In The Market Has Evaporated, And That Means Stocks Are Poised For A Selloff

http://www.businessinsider.com/fear-in-the-market-has-evaporated-and-that-means-stocks-are-poised-for-a-selloff-2012-8

From the latest note from BTIG's Dan Greenhaus comes an important observation about the VIX, the index which measures how much investors are willing to pay for downside protection via options. It's sometimes called the fear index because it rises with more fear.
Anyway, lately it's been stunningly mellow, witht the VIX dropping day after day.
Says Greenhaus:
Lastly, we just wanted to pass along an observation that was making the rounds here at BTIG other than today being the lightest volume day of the year. The VIX index has declined on six of the last eight days and stands at less than 14 and is at the lowest level since the summer of 2007. Front month VIX futures though have fallen below 16, something that has happened a few times since early 2008 (see table below chart). Each of the last times this has happened, the S&P 500 has embarked on a losing streak of varying amounts but generally lasting at least one month. This is a good time to remind clients that August and September are not good months historically speaking.
He adds this table:


Read more: http://www.businessinsider.com/fear-in-the-market-has-evaporated-and-that-means-stocks-are-poised-for-a-selloff-2012-8#ixzz23VjkWnqB

[Demeter]

37. Could it mean that everybody is OUT of the Market?

The machines are just swapping bits between themselves.

[tclambert]

53. You're saying Skynet and Colossus have already taken over, and we humans

will soon be relegated to the obsolete pile? Wait, how do I know any of you posting here are real persons? Clearly, xchrom is some kind of machine. No human could post so much so fast.

[Demeter]

57. I post faster than X, and all too human

But I'm thinking more that it's VACATION in Europe, and the Elites, hanging together, have probably universally bugged out for a breather.

[xchrom]

22. Awful Spanish Housing Chart

http://www.businessinsider.com/spanish-housing-down-112-year-over-year-2012-8

Just look at this horrible chart of the year-over-year change in Spanish housing, which is down 11.2% YOY and 31% from peak.

[Tansy_Gold]

55. Hmmm, maybe I should take another look

at my dream of moving to Spain. . . . . . . . .

[xchrom]

56. I had the exact same thought. Nt

[Tansy_Gold]

58. . . .

www.kyero.com

[Demeter]

60. Now I'm drooling

Those look like very reasonable prices...

[Tansy_Gold]

63. Me, too.

Prices are obviously a lot better than they were a few years ago when i started looking/dreaming.

Houses and rooms are smaller than what most Americans are used to, but we're gluttons that way and should stop being so greedy.

Fuengirola is beautiful, or at least it was back umpteen years ago when I was there. If I could easily liquidate assets, take my dogs and my "stuff" with me, I'd go tomorrow.

I need to get rid of "stuff."

[xchrom]

72. it's bilbao for me ...or madrid. nt

[Warpy]

75. I just checked out central Madrid

and the prices are quite doable. I can take in more Spanish than I can spit out, but that's doable, too.

If only the cost of shipping the crap that I'd keep (antiques and hobbies) weren't so huge.

[xchrom]

76. shipping to europe is a monster.

i wish it wasn't so much.

i'd love to be in central madrid -- beautiful place.

[Demeter]

78. Could you not store it?

And maybe bring one piece at a time?

[Warpy]

82. That's actually more expensive than cramming everything

into an 8X8X12 container and having it shipped over.

The real estate prices are extremely tempting, though.

[Tansy_Gold]

83. A few antiques, but

LOTS and LOTS and LOTS of hobbies. ............

:::sigh:::

I really need to clean out some stuff. . . . . .

[Warpy]

85. I'm a fiber artist

Tell me about it...

[Tansy_Gold]

87. fibers don't weigh as much

and they can be compressed, you know, like with those space-saver vacuum bags?

Try doing that with 78 plastic shoe boxes and 27 5-gallon pails of rocks. . . . . . .

about 1500 lbs of ironwood and mesquite logs. . . . ..

a full-size bandsaw, a table saw, a drill press, a lathe, a rock saw, a faceting machine, assorted small power tools, hand tools. . . . . .

all the sewing "stuff," like fabrics and sewing machines and patterns and. . . .

not to mention 4,000 books. . . . . . .


Yes, I need to get rid of some. . . . . stuff.

[Warpy]

88. Those bags don't work, they lose vacuum within days if not hours

Ever see a Mexican rug loom?

[Tansy_Gold]

90. Oh, well, in that case. . . . .

I guess we're in the same boat -- and I think it's a tramp steamer!

[DemReadingDU]

91. I think I am in that boat too, way too much stuff

But it's good stuff, mostly books!
and spouse has lots of tools

[Tansy_Gold]

92. Tools, books,

Rocks, fibers, wood....

It's all good!


Welcome aboard!

[xchrom]

71. i found this too -- i can't afford it -- but

http://www.spainhouses.net/en/bilbao/sale/flats/flat-sale-bilbao_d857139.html

[Demeter]

59. We could start a DU colony

Hablo un poco espan~ol.

And I could look up my ex-in-laws, and tell them I told you so.

But I think Iceland has a smarter, more politically and economically savvy population. And natural hot tubs!
Lots of indoor sports. No fear of sunburn.

[Tansy_Gold]

61. I've been to both places

I'll take Spain, thank you very much. Iceland has natural hot tubs but also volcanoes. I don't do snow and I REALLY don't do volcanoes.



http://www.kyero.com/property/1821227-villa-for-sale-fuengirola

[xchrom]

73. a little hotel we could run! help americans who want to move

fund the nooks and crannies.

i have a friend who does that in italy.

she's done a lot of different things in order to live there -- clean houses, took people around the area -- and now she has a food book coming out.

[xchrom]

74. my outfit for changing the rooms...

[xchrom]

23. China's winning strategy in Africa

http://www.atimes.com/atimes/China/NH15Ad01.html

Contention between China and the United States is extending far beyond the current hot spot of the South China Sea. As China's economy continues its rapid expansion, a truly global realignment of power is taking place. Regions that were dominated by the West for centuries are now coming into China's orbit, challenging America's position at the top on a once-unipolar world.

This trend is particularly evident in Africa. The United States is now seeking to counter China's economic and political inroads in the African continent. The Africa policies of both the US and China are important not only in their own right, but also because these policies serve to indicate the significant differences in these two powers' general foreign strategies and world views.

US Secretary of State Hillary Rodham Clinton has been quick to question China's relationship with Africa, and highlight the



purported difference in Africa policy between the US and China. During her visit to Senegal (the first stop of her African tour), she promoted "a model of sustainable partnership that adds value, rather than extracts it". She went on to promise: "America will stand up for democracy and universal human rights even when it might be easier to look the other way and keep the resources flowing." [1]

These comments have been widely understood as thinly disguised swipes at Chinese efforts in the region. Chinese state media reacted swiftly, saying Clinton's words constituted "cheap shots". An editorial from the official Xinhua news agency, titled "US plot to sow discord between China, Africa is doomed to fail" stated:

'China's booming economic relations with Africa have stemmed both from their time-honored friendship and complementary needs of development. Its genuine respect of and support for African countries' development paths are lauded and welcomed across the continent. The friendly and mutually beneficial interaction between China and Africa gives the lie to Clinton's insinuation. [2]'

[Demeter]

38. While China was building in Africa, the US was bombing Libya and Droning

Too late now.

[xchrom]

24. A Brotherhood coup in Egypt

http://www.atimes.com/atimes/Middle_East/NH15Ak04.html

Egypt's ostensibly inexperienced president Mohammed Morsi accomplished nothing short of a coup d'etat on Sunday when he replaced the men who were widely seen as Egypt's rulers - Field Marshal Mohammed Hussein Tantawi and Lieutenant general Sami Anan, among others - and shredded the latest constitutional amendment issued by the Supreme Council of the Armed Forces (SCAF).

The SCAF, its rule undercut by the collapse of authority in the Sinai peninsula and by last week's cross-border terror attack (which cost the lives of 16 soldiers and caught the Egyptians unprepared despite a "detailed intelligence warning&quot , conceded. However, it is uncertain what its true motives and intentions are, as is the precise magnitude, in practical terms, of the Muslim Brotherhood's spectacular victory. Many eyes, both in the region



and farther away, are fixed on Egypt as the intrigue unfolds.

It remains unclear what exactly transpired in the days and hours prior to Sunday afternoon's surprise announcement. The fact that General Abdel Fattah al-Sisi, Tantawi's replacement as defense minister and army chief, is nearly two decades younger than him has raised the possibility of an internal army coup. The sharp generational divide in the army's higher echelon and the unwillingness of the older generals to share some of their power with younger colleagues has been a liability for the SCAF since the ouster of former Egyptian president Hosni Mubarak, himself an octogenarian air force general.

As Shadi Hamid from the Brookings Doha Center wrote on his Twitter account, "What we saw today in Egypt increasingly seems like a mix of a civilian counter-coup and a coordinated coup within the military itself."

[xchrom]

25. Eurozone economy shrinks by 0.2%

http://www.bbc.co.uk/news/business-19252724


The economy of the eurozone shrank 0.2% in the three months from April to June compared with the previous quarter.

The figures from Eurostat covering the 17 countries that use the euro followed zero growth in the previous quarter.

Europe's biggest economy, Germany, grew by 0.3% in the second quarter, helped by exports and domestic consumption.

France announced its economy had recorded zero growth in the period, which was better than had been expected.

[xchrom]

28. No money for old stones

http://www.presseurop.eu/en/content/article/2502011-no-money-old-stones

?1344603712

The euro crisis and the Peloponnesian War are rarely compared. But look beyond the dark suited men or visionaries in white, and today's financial crisis is indeed as much a threat to the world now as the ancient Greek conflict was back then.

Europe may be saved, but it won’t be the same; neither its citizens nor its heritage. When there is no money for pensions, it seems frivolous to demand it to protect stones. The stones of Greece, however, also deserve respect. On them there took root a political system of universal aspiration called democracy, and above them there arose a certain idea of Europe.

Now, the stones are under threat. Curiously, the cradles of Western history and art today are countries being battered and half-drowned by the succession of crisis followed by cuts followed by yet another crisis. Greece, Italy, Spain and Portugal together are home to 122 UNESCO World Heritage sites, or 13 per cent of the global total.

Glorious past
A glorious past which may turn into a twisted future, like that of the Roman Coliseum? The amphitheatre of Vespasian is losing stones, probably because of too much traffic, and is leaning over by 40cm on its southern side, to the horror of the Italians.

[xchrom]

29. Paul Ryan sold shares on same day as private briefing of banking crisis

http://www.guardian.co.uk/world/2012/aug/13/paul-ryan-sold-shares-banking-crisis

Paul Ryan, Mitt Romney's vice-presidential running mate, sold stock in US banks on the same day he attended a confidential meeting where top level officials disclosed the sector was heading for a deep crisis.

The congressman on Monday denied profiting from information gleaned from the meeting on 18 September 2008 when Federal Reserve chairman Ben Bernanke, then treasury secretary Hank Paulson and others outlined their fears for the banking sector. His office said he had no control over the trades.

Public records show that on the same day as the meeting, Ryan sold stock in troubled banks including Wachovia and Citigroup and bought shares in Goldman Sachs, Paulson's old employer and a bank that had been disclosed to be stronger than many of its rivals. The sale was not illegal at the time.

Not long after the meeting, Wachovia's already troubled share price went into free fall. It plunged 39% on the afternoon of 26 September alone as investors worried the bank would collapse. It was eventually taken over by Wells Fargo for $15bn, a fraction of its former value

[Tansy_Gold]

54. So what?

IOKIYAR

[xchrom]

30. Hedge Funds Have $74 Billion As Europe Fire Sale Delayed

http://www.bloomberg.com/news/2012-08-13/hedge-funds-have-74-billion-as-europe-fire-sale-delayed.html

Hedge funds and private-equity firms have amassed an unprecedented 60 billion euros ($74 billion) to invest in distressed debt in anticipation that Europe’s sovereign-debt crisis will push banks into the biggest fire sale in history. The problem is few are selling.

Apollo Global Management LLC (APO), Oaktree Capital Group LLC (OAK), Avenue Capital Group LLC and Davidson Kempner Capital Management LLC are among U.S. firms that have flocked to Europe, setting up offices and raising funds to benefit from the most severe period of distress in the region. The money raised for distressed-debt funds gives the firms about 100 billion euros to spend on deals including leverage, according to PricewaterhouseCoopers LLP

European Central Bank PresidentMario Draghi has cut interest rates three times to a record low and flooded the financial system with cash since taking over at the helm of the central bank in November, taking pressure off banks to sell their assets at depressed prices. The European Banking Authority said last month that banks have been able to shore up their balance sheets over the past year without “fire sales.”

“There are quite a lot of opportunities, but the problem is whether banks are selling,” Christopher Hart, president elect of TMA UK, a trade organization representing turnaround specialists, said during a London industry gathering in June. “As the adage goes, ‘a rolling loan gathers no loss.’”

[xchrom]

31. EUROPE ON THE EDGE OF RECESSION

http://hosted.ap.org/dynamic/stories/E/EU_EUROPE_ECONOMY?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2012-08-14-06-23-55

EUROPE ON THE EDGE OF RECESSION

LONDON (AP) -- Europe is edging closer to recession, dragged down by the crippling debt problems of the 17-country euro bloc, official figures showed Tuesday.

Eurostat, the European Union's statistics agency, revealed that the economies of both the eurozone and the wider 27-country EU shrank by a quarterly rate of 0.2 percent in the second quarter of the year. In the first quarter, output for both regions was flat. A recession is officially defined as two straight quarters of falling output.

Europe's stumbling economy is making it harder for other economies around the world to recover. The region is the U.S.'s largest export customer and any fall-off in demand will hit order books - as well as President Barack Obama's election prospects.

"The big picture is that the economic growth required to bring the region's debt crisis to an end is still nowhere in sight," said Jonathan Loynes, chief European economist at Capital Economics.

[xchrom]

32. GREECE RAISES MONEY TO PAY OFF BOND NEXT WEEK

http://hosted.ap.org/dynamic/stories/E/EU_GREECE?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2012-08-14-05-46-43

ATHENS, Greece (AP) -- Greece's debt management agency says it has raised (EURO)4.06 billion ($5.01 billion) in an auction of short-term debt, money it will use to repay a bond next week.

But the debt-crippled country saw its borrowing costs rise, while demand for the 13-week treasury bills was much lower than in last month's issue.

The interest rate in the auction was 4.43 percent, up from last month's equivalent 4.28 percent. The auction was 1.36 percent oversubscribed as against 2.12 times last time.

Tuesday's successful treasury bill auction means Athens will not have to seek emergency funding to pay off a (EURO)3.2 billion bond that matures Aug. 20 and is held by the European Central Bank.

[xchrom]

33. The Lewis Powell Memo - Corporate Blueprint to Dominate Democracy

https://www.commondreams.org/view/2011/08/25-9

Forty years ago this week, on August 23, 1971, Justice Lewis F. Powell, Jr., an attorney from Richmond, Virginia, drafted a confidential memorandum for the U.S. Chamber of Commerce that describes a strategy for the corporate takeover of the dominant public institutions of American society.

Powell and his friend Eugene Sydnor, then-chairman of the Chamber’s education committee, believed the Chamber had to transform itself from a passive business group into a powerful political force capable of taking on what Powell described as a major ongoing “attack on the American free enterprise system.”

An astute observer of the business community and broader social trends, Powell was a former president of the American Bar Association and a board member of tobacco giant Philip Morris and other companies. In his memo, he detailed a series of possible “avenues of action” that the Chamber and the broader business community should take in response to fierce criticism in the media, campus-based protests, and new consumer and environmental laws.

Environmental awareness and pressure on corporate polluters had reached a new peak in the months before the Powell memo was written. In January 1970, President Nixon signed the National Environmental Policy Act, which formally recognized the environment’s importance by establishing the White House Council on Environmental Quality. Massive Earth Day events took place all over the country just a few months later and by early July, Nixon signed an executive order that created the Environmental Protection Agency (EPA). Tough new amendments to the Clean Air Act followed in December 1970 and by April 1971, EPA announced the first air pollution standards. Lead paint was soon regulated for the first time, and the awareness of the impacts of pesticides and other pollutants-- made famous by Rachel Carson in her 1962 book, Silent Spring – was recognized when DDT was finally banned for agricultural use in 1972.

[Demeter]

39. A Question of Improper Money Flows

"IMPROPER?" THAT'S A WUSSY WORD FOR WHAT THEY DID...

http://www.nytimes.com/2012/08/14/opinion/a-question-of-illegal-money-flows.html

Standard Chartered, the London-based bank, may soon reach a settlement with bank regulators to resolve charges that it violated American banking rules that restrict transactions with Iranian clients. The rules are intended to impede money flows that might finance terrorism and weapons of mass destruction.

The bank has said it “strongly rejects” allegations that it improperly processed $250 billion of transactions for Iranians. The claims were leveled last week by New York’s Department of Financial Services, a regulatory agency recently formed by merging the state’s banking and insurance departments. But if the bank does not settle the charges, its officials will have to rebut them this week at a meeting called by Benjamin Lawsky, the former federal prosecutor who leads the department. It seems a safe bet that the officials would rather settle than have to defend the bank’s actions, with specificity, before the authorities.

A settlement would speak to the strength of bank regulation in New York. Since the charges were detailed in a 27-page order, Mr. Lawsky has been criticized for pushing his case ahead of the Federal Reserve, the Treasury and the Department of Justice, all of which were also reviewing Standard Chartered’s Iranian transactions.

While authorities usually act together in such cases, the feds have been on the Standard Chartered case for years without bringing charges or reaching a conclusion....

YES, WE'VE NOTICED

[Demeter]

40. On Wall Street, the Rising Cost of Faster Trades

http://www.nytimes.com/2012/08/14/business/on-wall-street-the-rising-cost-of-high-speed-trading.html

For several years, the Wall Street wizards who built a faster, more fragmented stock market justified their creation by pointing to the benefits it yielded for investors in the form of lower trading costs. But as the speed and complexity of the markets have continued to change at a rapid pace — with trade times now measured in millionths of a second — a growing number of studies and market participants suggest that those benefits to investors have stalled or even started to reverse.

Research from the broker Abel/Noser indicates that the total cost for an investor to get into and out of a single share of stock fell by more than half between 2000 and 2010, to 3.5 cents. Since then, though, the cost has leveled off and then ticked up in the most recent quarter to 3.8 cents, confirming a trend that has also been visible in recent data from Credit Suisse Trading Strategy and from Celent, a consulting firm specializing in financial markets.

The advantages of the nation’s increasingly high-speed stock market are under the microscope after a number of recent trading malfunctions underscored the risks and instability that have come with the rapid changes. This month, one of Wall Street’s most important trading firms, Knight Capital, lost $440 million in 45 minutes after installing faulty software designed to keep up with an evolving market. As the battle to introduce more sophisticated technology continues, raising the specter of more problems like Knight’s, the diminishing returns flowing back to investors are making even longtime proponents of innovation question whether the competition to make the market faster and more efficient is now doing more harm than good.

“They’ve reached the point where the competition is measured in microseconds and there are essentially no benefits to the public at that level,” said Lawrence E. Harris, the former chief economist at the Securities and Exchange Commission, and now a professor at the University of Southern California.

[Demeter]

41. Paul Ryan is With Unions on One Lone Issue (It Affects His Family, Of Course)

http://www.alternet.org/hot-news-views/paul-ryan-unions-one-lone-issue-it-affects-his-family-course?akid=9209.227380.jms3mu&rd=1&src=newsletter692553&t=24

It probably wouldn't surprise you to learn that Paul Ryan, like many or most Republican politicians, has not always been a big supporter of unions. What might come as more of a surprise is that sometimes Ryan actually has been union-friendly, specifically construction union-friendly.

One of the laws building trades unions care most about is the Davis-Bacon Act, under which federally funded construction projects must pay the prevailing wage in an area. And Paul Ryan has repeatedly voted to protect Davis-Bacon, even as he supported Wisconsin Gov. Scott Walker's assault on public workers and has accumulated a 16 percent lifetime average on the AFL-CIO legislative scorecard (the 16 percent of good votes are overwhelmingly on Davis-Bacon).

Suzy Khimm explained Ryan's anomalous support for construction unions last year:

Both Ryan's supporters and detractors point to his family ties to the construction industry to make sense of his position. His great-grandfather established Ryan Incorporated Central in 1884, and the company is currently run by his cousins. Ryan Inc. Central—which has been a signatory to the International Union of Operating Engineers since 1966—once employed Ryan as a consultant. Like other companies using unionized labor to carry out public projects, his family firm would suffer a big blow if Davis-Bacon were repealed, as federal contractors could drastically underbid the firm.

A good vote from a Republican is still a good vote. But when you compare Ryan's votes on this one issue, you have to wonder if his votes are only incidentally union friendly, and are more geared at protecting the profits of his family firm. Because otherwise, the stray pro-union statement notwithstanding, the fact is that Paul Ryan wants to undercut the livelihoods of construction and other workers in myriad other ways—seeking to gut Medicare and Social Security, voting against workplace safety bills and financial reform and equal pay and Trade Adjustment Assistance and more.

Ryan's votes to protect the Davis-Bacon prevailing wage requirements help millions of construction workers. But his hero, Ayn Rand, would be disgusted with him if helping workers was his motive in those votes. She'd be proud, on the other hand, if his motive was his own family's profit.

[Roland99]

50. Otherwise, he's a huge Ayn Randian

Paul Ryan Book Club: Shrugging Off Ayn Rand?
http://news.yahoo.com/paul-ryan-book-club-shrugging-off-ayn-rand-100022763--abc-news-politics.html

[div class="excerpt" Ryan, you see, is the country's most powerful Randian. At least, he used to be. More on that in a moment. First, a look at his adoring relationship with the work of Russian emigre novelist Ayn Rand, author of "Atlas Shrugged" and "The Fountainhead."

It began, according to a 2005 speech Ryan gave to the The Atlas Society, when he was still a student. It guided his thinking on monetary policy decades later:

"I grew up reading Ayn Rand and it taught me quite a bit about who I am and what my value systems are," he told the group. "It's inspired me so much that it's required reading in my office for all my interns and my staff."

...

He continued: "But the reason I got involved in public service, by and large, if I had to credit one thinker, one person, it would be Ayn Rand. And the fight we are in here, make no mistake about it, is a fight of individualism versus collectivism."

[Demeter]

44. Congressional leaders near budget deal to keep government running

http://www.washingtonpost.com/politics/congressional-leaders-near-deal-to-keep-government-running/2012/07/30/gJQA9ryWLX_story.html

House and Senate leaders are nearing a temporary spending deal that would keep the federal government running for the first half of the next fiscal year, which will begin in October, aides in both parties said Monday, an effort to avoid a messy government shutdown fight on the eve of the November election...The deal would come with two months to spare, an unusually early resolution of Washington’s annual budget fight for a Congress that has repeatedly run up against do-or-die deadlines and nearly forced shutdowns.

It is a sign that Republicans, in particular, understand the political peril of risking a budget fight in late September and would prefer a strategic retreat now, denying Democrats a chance to use a possible shutdown as a political cudgel at the height of the campaign season. Under the deal, agency spending for the first half of the year would rise at a pace that would not exceed a $1.047 trillion limit that both parties agreed to in last summer’s debt deal, a senior House aide said. That level represents a significant concession by conservatives, who had wanted to cut spending much more deeply.

House Budget Committee Chairman Paul Ryan (R-Wis.) had set agency spending levels at $1.028 trillion in the budget document he presented in the spring, a compromise with fiscal hard-liners who wanted to go even lower. The House has spent months passing spending bills for different agencies geared toward the lower Ryan budget number, in the face of objections from Senate Democrats and a White House veto threat for any spending measure that cuts more deeply than the debt-ceiling agreement. But some conservatives in recent weeks signaled that they could temporarily accept the higher levels, freeing Republican leaders to negotiate the deal. If the GOP is victorious in November, conservatives would aim to use their party’s control of the White House and the Senate to revisit spending in the new year.

A senior Senate Democratic aide called the negotiations between the two chambers “very productive...The guys who spoil for a fight for the sake of a fight seem to be losing on this one,” he said....Meanwhile, a senior GOP House aide said a deal would help Republicans. “It would eliminate the possibility of Washington Democrats trying to force a shutdown fight in September, hoping to benefit politically,” he said...The aides spoke on the condition of anonymity because the deal is not final and the talks are confidential.

A six-month resolution, which would expire at the end of March, would remove the basic discussion about keeping the government running from a much broader December fiscal debate about how to handle expiring tax cuts and deep automatic spending reductions set to take effect in January...With basic agency spending settled, some Republicans might even push to skip a post-election lame-duck session should the GOP prevail in November, postponing major decisions until after control of the White House turned over in January.

NOTHING LIKE COUNTING YOUR CHICKENS BEFORE THE EGGS HAVE HATCHED...

About The Budget Agreement Posted by Daniel Horowitz FROM THE OTHER SIDE OF THE AISLE

http://www.redstate.com/dhorowitz3/2012/08/01/about-the-budget-agreement/

Yesterday, it was announced that John Boehner and Harry Reid had reached an early agreement on the FY 2013 budget in order to avoid a government shutdown on October 1. Pursuant to the agreement, both chambers will vote on a 6-month continuing resolution after returning from the August recess in September. The CR will provide spending for discretionary programs set at the $1.047 trillion level agreed upon in last year’s debt ceiling agreement instead of the $1.028 trillion figure prescribed in the House-passed budget. It will also continue funding for Obamacare...

The Strategy:

Earlier this month, Senator DeMint penned an op-ed with Senators Graham and Johnson calling on leaders of both parties to pass a CR that would fund government into 2013, while “leaving major issues for the newly elected president and Congress.”

There are several motivations behind his strategy. First, these conservatives want to avoid a scenario in which everyone is pressured into supporting a bad piece of legislation – perhaps a massive omnibus bill that contains new policies – under the duress of beating the clock in September. Republicans tend to capitulate when pressured for time, especially with the major elections looming just 5-6 weeks later. While DeMint would love to have a fight about Obamacare and spending right before the election, he recognizes that leadership will either shirk from the fight or bungle it, leaving us incorrigibly humiliated. It’s better to defer the fight than prosecute it poorly.

Second, he wants to avoid a lame duck session, which is notorious for GOP capitulations. In 2010, Republicans (many of whom were on their way out the door) agreed to pass the START treaty, a massive FDA food takeover, repealed don’t ask don’t tell, and agreed to a tax extenders deal that undercut their superior leverage, setting us up for future problems that we are still dealing with today. By kicking the budget fight into 2013, we will avoid a scenario in which the budget bill is used as a vehicle to pass other bad legislation, most notably, a bad tax extender deal. It will also give us the leverage to shut down the lame duck session altogether, and preclude the Senate from passing bad treaties.

Third, and most obvious of all, they are hoping that we win back all branches of government next year. All things equal, it’s better to wait until 2013 to make all the important decision, so we’ll have more power and leverage...

IS IT ARROGANCE? OR IS THE FIX IN?

[Demeter]

45. As ‘fiscal cliff’ looms, debate over pre-Election Day layoff notices heats up

http://www.washingtonpost.com/business/economy/as-fiscal-cliff-looms-debate-over-pre--election-day-layoff-notices-heats-up/2012/07/30/gJQAxNlSLX_story.html?hpid=z1#

The deep federal spending cuts scheduled to take effect at the start of next year may trigger dismissal notices for tens of thousands of employees of government contractors, companies and analysts say, and the warnings may start going out at a particularly sensitive time:

Days before the presidential election.

By law, all but the smallest companies must notify their workforce at least 60 days in advance when they know of specific job cuts that are likely to happen.

Obama administration officials say that the threat of layoffs is overblown and that Republicans are playing up the possibility rather than trying to head it off. The Labor Department said Monday that it would be “inappropriate” for contractors to send out large-scale dismissal notices, because it is unclear whether the federal cuts will occur and how they would be carried out.

Republicans reacted with fury, saying it is the White House that is playing politics...

[Fuddnik]

77. If they're going to cut wasteful spending.

Send pink slips to every member of congress.

[Demeter]

48. There's more, but I can only take so much hypocrisy before breakfast...

Tempus fugit...see you all later! If there is a later....

[Demeter]

49. Once Upon a Trickle Down: The Rise and Fall of Supply Side Economics MARK FIORE

&list=PLE94797B76A25D240&index=1&feature=plcp

[Roland99]

51. US Futures up decidedly on stronger than expected retail sales rise

S&P 500 +0.4%
DOW +0.4%
NASDAQ +0.5%

[Roland99]

52. Retail sales rise stronger-than-expected in July

http://www.marketwatch.com/story/retail-sales-rise-stronger-than-expected-in-july-2012-08-14?link=MW_home_latest_news

Sales at U.S. retailers increased 0.8% in July to a seasonally adjusted $403.9 billion, the Commerce Department estimated Tuesday. This is the biggest gain since February and the first in four months. Sales fell a downwardly revised 0.7% in June compared with the initial estimate of a 0.5% drop. Details of the July report were strong across-the-board. Ahead of the report, economists surveyed by MarketWatch expected total sales to rise 0.2%. Excluding the 0.8% rise in motor vehicle sales, retail sales rose 0.8%. Economists had expected ex-auto sales to rise 0.3%. Core sales, excluding autos, gasoline and building materials, rose 0.9% in July. This was the biggest gain since January

something's rather weird with this, imho.

[Demeter]

62. Market seems to think so, too

[Roland99]

66. ** It's all in the Seasonal Adjustment **

http://www.zerohedge.com/news/mystery-july-retail-sales-beat-solved-it-all-seasonal-adjustment

The July retail sales beat came as a surprise to many: an 0.8% increase (full series here) at a time when the data was supposed to grow at less than half this would surely be indicative of a potential turnaround in the US economy. Then we decided to do a quick spot check if maybe the Census Bureau had not adopted one of the BLS' worst habits: fudging seasonal adjustment factors. The reason for this is because we happened to notice that Not Seasonally Adjusted (full series here) retail sales data in July actually declined by 0.9% from $405.8 to $402 billion. Of course, if the Census Bureau was using a consistent, or at least remotely comparable July seasonal adjustment factor as it has in the past, this would make sense and we would move on. So we decided to look at what the July seasonal adjustment variance over the past decade has been.

What we found would have shocked us if indeed this is not precisely what we expected: with the July seasonal adjustment factor routinely subtracting a substantial amount from the NSA number, averaging at -$5.2 billion, in 2012, for the first time this decade, the seasonal adjustment not only did not subtract, but in fact added "value" to the NSA number, resulting in a seasonally adjusted number that was $1.9 billion higher than the NSA number at $403.9 billion.

[Roland99]

64. U.S. June business inventories up 0.1%

[Roland99]

65. US 10-year Treasury yield back over 1.7%... 1.715%

wanna know why?

I started yet again on a refi for my house!

[Fuddnik]

68. That will do it every time.

Now I'm gonna wash my car.

[Roland99]

70. ha! I did that a couple weeks ago (and waxed them, too)

yeah...the yields are up a full 10bps since I app'd late last week. Never fails.

Hopefully I can lock very soon and keep the 3.25% rate (a full 2% below the current mortgage's rate!)

[Roland99]

67. Romney campaign — with a WSJ assist — explains how to pay for tax cuts

http://blogs.marketwatch.com/election/2012/08/14/romney-campaign-with-a-wsj-assist-explains-how-to-pay-for-tax-cuts/

The Mitt Romney campaign on Tuesday glowingly sent out an email touting this Wall Street Journal editorial , in which the newspaper rejected an assertion from the Brookings-Urban Institute Tax Policy Center that the exclusion of interest on tax-exempt municipal bonds and the exclusion of interest on life insurance savings won’t be touched.

...

Since the campaign is sending the op-ed along, one must assume that this is in fact the Romney position. To strip out the double and triple negatives, then, the Romney team is proposing taxing interest from municipal bonds and from life insurance savings.

...

The answer is, roughly $70 billion a year. According to a Congressional Research Service estimate, which used Joint Committee on Taxation estimates, tax exempt-tax credit bonds are set to cost $42.7 billion in fiscal 2014 and the exclusion of inside buildup, insurance is set to cost $27.7 billion for the same year. The WSJ op-ed cites a bigger number, $90 billion, using American Enterprise Institute figures.

But in either case, if the Romney campaign is putting these items on the table — and they seem to be saying they will — it would offset much or all of the $86 billion shortfall the Tax Policy Institute asserts and that the Obama campaign has seized upon to argue that Romney’s tax-cut plans will actually lead to middle-class tax hikes.

[Fuddnik]

69. Joke

Heaven & Hell Be careful what you ask God for.....


While walking down the street one day a Corrupt Senator (that may be redundant) was tragically hit by a car and died.

His soul arrives in heaven and is met by St. Peter at the entrance.

"Welcome to heaven," says St.. Peter. "Before you settle in, it seems there is a problem. We seldom see a high official around these parts, you see, so we're not sure what to do with you."

"No problem, just let me in," says the Senator.

"Well, I'd like to, but I have orders from the higher ups. What we'll do is have you spend one day in hell and one in heaven. Then you can choose where to spend eternity."

"Really?, I've made up my mind. I want to be in heaven," says the Senator.

"I'm sorry, but we have our rules."

And with that, St. Peter escorts him to the elevator and he goes down, down, down to hell.

The doors open and he finds himself in the middle of a green golf course.

In the distance is a clubhouse and standing in front of it are all his friends and other politicians who had worked with him.

Everyone is very happy and in evening dress. They run to greet him, shake his hand, and reminisce about the good times they had while getting rich at the expense of the people.

They played a friendly game of golf and then dine on lobster, caviar and the finest champagne.

Also present is the devil, who really is a very friendly guy who is having a good time dancing and telling jokes.

They are all having such a good time that before the Senator realizes it, it is time to go.

Everyone gives him a hearty farewell and waves while the elevator rises.

The elevator goes up, up, up and the door reopens in heaven where

St. Peter is waiting for him, "Now it's time to visit heaven...

So, 24 hours passed with the Senator joining a group of contented souls moving from cloud to cloud, playing the harp and singing. They have a good time and, before he realizes it, the 24 hours

have gone by and St. Peter returns.

"Well, then, you've spent a day in hell and another in heaven. Now choose your eternity."

The Senator reflects for a minute, then he answers: "Well, I would never have said it before, I mean heaven has been delightful, but I think I would be better off in hell."

So St. Peter escorts him to the elevator and he goes down, down, down to hell...

Now the doors of the elevator open and he's in the middle of a barren land covered with waste and garbage.

He sees all his friends, dressed in rags, picking up the trash and putting it in black bags as more trash falls to the ground.

The devil comes over to him and puts his arm around his shoulders.

"I don't understand," stammers the Senator. "Yesterday I was here and there was a golf course and clubhouse, and we ate lobster and caviar, drank champagne, and danced and had a great time.

Now there's just a wasteland full of garbage and my friends look miserable. What happened?"

The devil smiles at him and says, "Yesterday we were campaigning,

Today, you voted.."

[just1voice]

79. One solution to the completely corrupt financial system

http://www.alternet.org/economy/theres-only-one-solution-might-fix-our-corrupt-financial-system?paging=off

-----The simple truth is our giant banking system is metastasizing throughout our economy. It’s sucking away our wealth. And it’s out of control.

...We’ve seen our bankers commit every kind of financial crime imaginable. They trade on insider information. They manipulate markets. They rig bets. They fix prices. They sell securities that are designed to fail so that they can bet against them. They launder money for rogue nations. They create too-big-to-fail banks that gamble with impunity knowing that we will bail them out again and again. And they collectively crashed the economy causing 8 million workers to lose their jobs.

...Rather than bust them up into smaller privately owned pieces, I think it’s time to take them over and run them as public utilities, paying decent civil service salaries and no more. Rather than one big national bank, we should consider chartering many state banks (the number depending on the size of the state). North Dakota still has one and it runs just fine. Then our public-employee bankers could concentrate on moving savings into good investments rather than moving the chips around their rigged roulette wheels.-----

[Demeter]

81. Second that notion!

[Fuddnik]

84. But, what about the FRSP's?

I was so looking forward to that!

[Demeter]

93. I'm sure there will be a need, regardless

Never fear. Wouldn't want to disappoint you.

[Ghost Dog]

96. .

Last edited Tue Aug 14, 2012, 08:34 PM - Edit history (1)

[Demeter]

80. Can the Credit Union Industry Survive -- Its Regulator?

http://www.zerohedge.com/contributed/2012-08-14/can-credit-union-industry-survive-its-regulator

It is axiomatic that regulators never act before a crisis. But the public still does not understand the degree to which regulators encourage acts of willful idiocy for political purposes. Witness the recent track record for The National Credit Union Administration, the supposed regulator of the credit union industry, which has become an engine of systemic risk in this small but significant credit sector. The credit union industry is a bit over $1 trillion in assets, mostly in very small institutions around the country. The NCUA has a federally insured insurance fund. The skew towards very small institutions in the world of credit unions is even more severe than among banks, where 6 out of every seven depositories is a community bank.

The NCUA took an especially severe kicking in the subprime mess, with several corporate credit unions gutted by losses on subprime securities. A tab measured in the tens of billions of dollars still awaiting a final resolution. See my comment in American Banker, “Say No to More Lending Power for Credit Unions,” describing how the largest corporate credit unions dug an amazing financial hole by speculating on subprime debt – with the full knowledge of the NCUA and other federal regulators. This fiscal black hole created by the NCUA is guaranteed by US taxpayers and now threatens the existence of little credit unions around the nation. My esteemed friend and business partner Dennis Santiago, CEO of Institutional Risk Analytics, recently published ratings for credit unions as part of The IRA Bank Monitor. For example, let’s look at the Doe Run credit union in Brandenberg, KY. The Doe Run depository is rated “Good” by IRA, but is also quite fragile in terms of its ability to absorb loan losses. The $8.8 million asset depository had 20% of its assets and most of its liquid reserves invested in corporate credit unions at the end of 2011, of note. In good quarters, this little credit union in KY does about 0.4% ROA. In 2011, assessments for the NCUA corporate credit union “stabilization” fund were consuming more than $6,000 out of the Doe Run credit union’s $20,000 or so in income for the year. Retail credit unions like Doe Run are captive of the badly run corporate credit union vehicles, which are mismanaged under the watchful eye of the NCUA.



The NCUA still cannot or will not tell its member institutions the true scale of the losses due to mismanagement at corporate credit unions. Suffice to say that the corporate credit unions bought some particularly nasty toxic waste from the subprime zombie swamp. This crisis affecting credit unions is one of the least recognized and reported aspects of the financial crisis. Assessments needed to repay the Treasury could cripple the capital generation of credit unions for years. Keep in mind that the NCUA has been audited repeatedly by the GAO and internal auditors over the past decade and found severely deficient in terms of internal systems and controls. Nobody really, even today, knows the full extent of the losses in the NCUA. But this is also why the back-door effort by the NCUA to allow business lending by credit unions is especially ill advised. The NCUA has allowed credit unions to make loans to small businesses under several loopholes known as member business loans or “MBL,” this in an effort to increase income in the industry. Why? Income is needed to fill the yawning deficit in the NCUA insurance fund due to the financial speculation by the now defunct corporate credit unions and several others on life support. Allowing expanded MBL lending is essentially a strategy to “double down” on the risk taken by credit unions, institutions which lack the people and the systems to effectively monitor small business credit. Loan losses at credit unions will likely increase as a result, putting increased stress on these lightly capitalized banks. Jeff Gerhart, chairman of the Independent Community Bankers of America, put it simply:

“The MBL cap was not set arbitrarily. Its purpose, as described by the Senate Banking Committee, is ‘to ensure that credit unions continue to fulfill their specified mission of meeting the credit and savings needs of consumers, especially persons of modest means, through an emphasis on consumer rather than business loans.’ With the NCUA’s sweeping expansion of MBL authority, which is sure to harm community banks and significantly increase risk to the National Credit Union Share Insurance Fund, why is MBL legislation needed at all?”

The push to give business lending authority to credit unions is a red flag. Let’s recall that most regional and community banks are not equipped to deal with significant business lending exposures. Banks have larger profits to support such activities than do credit unions, yet most banks stay away from business lending. All but the largest credit unions are simply too small to justify the people and resources needed to underwrite and service small business loans in a safe and sound manner. Small business loans are often too small to be profitable. Keep in mind too that most banks are already fleeing small business lending, so the idea of credit unions jumping into the gap and actually making money is truly madness. But if you are a regulator like the NCUA facing a financial black hole in your insurance fund and members of Congress anxious to promote growth, what do you do? You double down on the bad bet and allow credit unions to expand small business risk exposures. This is easy to sell up on Capitol Hill under the rubric of “job creation,” but the effect on the credit union industry and the economy will likely be negative when the full cost is totaled. The real question, though, is whether the credit union industry can survive the continued operational chaos inside the NCUA.

[DemReadingDU]

97. I'd suspected credit unions had issues

There really is no safe financial institution.

[Fuddnik]

89. Florida Homeowners Associations foreclosing on banks.

South Florida homeowner associations are foreclosing on some of the nation's largest banks, accusing the lenders of failing to pay thousands of dollars in maintenance fees on repossessed properties.

The foreclosure filings are a growing trend as associations become more aggressive in going after delinquent fees that have crippled HOA budgets during the housing bust.

Banks owe a portion of the past-due maintenance fees and the full amount from the date they take title to the property, attorneys said. If the lenders fall behind, they're subject to foreclosure just as an individual owner would be.

In one Broward County case, Deutsche Bank didn't pay maintenance fees for nearly three years on a townhome it repossessed in September 2009 at the Southbridge development in Pembroke Pines, said Ben Solomon, a lawyer for the association.

The Southbridge HOA filed for foreclosure against Deutsche Bank last year. The bank finally paid $25,553 in June — and only then because it had to convey clear title to another buyer, Solomon said.

"They expect payment from their customers, but once they become our customers, they don't want to pay us," said Marc Lebron, treasurer of the Southbridge HOA. "It's ironic, isn't it?"

Solomon is representing dozens of other South Florida homeowner associations that have filed foreclosures against Deutsche Bank, JPMorgan Chase, Citibank and others. He expects more than 100 similar cases to be filed by the end of the year.

(snip)
http://www.sun-sentinel.com/business/realestate/fl-hoa-foreclose-banks-20120810,0,5206219.story

[Demeter]

94. The Co-op (from which I resigned because they wouldn't listen to me)

is going to try to foreclose on Fannie Mae, for violating the terms of the settlement, to wit: they have to sell the bloody property! They just reneged on the second customer for the unit. Totally withdrew the property.

I am guessing Ed DeMarco didn't think he was getting enough out of the short sale....

[Fuddnik]

95. That should do wonders for your sanity.