Baltic Dry Index. 1790 -50 (Down 57.50% since May 26.)
LIR Gold Target by 2019: $3,000.
“What members of both parties realize is that we can’t allow a financial crisis like this one that we just went through to happen again.”
President Obama.
President Obama is a hopeful optimist. Today we take a look at the hidden crisis in America, not that you would know it from the action in US stock markets lately. Up first, the USA for the second year in succession hits a trillion dollar deficit in June, nine months in to the US fiscal year. By the end of the fiscal year, the US federal deficit will be somewhere between 1.3 trillion to 1.4 trillion, a slight “improvement” on last year’s 1.5 trillion deficit. As terrifying as a peacetime budget deficit of 2.8 trillion in 2 years is, it pales in comparison to the planned 9 trillion dollar deficit intended to be run up in the next 9 years. A trillion here, a trillion there, and pretty soon you’re talking monopoly money, to mangle the old saying. Stay long precious metals. Most impartial observers think the actual amount will be closer to 15 trillion over the next 9 years. Fiat currency, the dodgy dollar and the even more dodgy euro, is now out of control.
“Deficits don’t matter,” infamously opined former Vice President Dick Cheney, who also tossed in for good measure “that the American way of life is not negotiable.” He was wrong on both, of course, as the out of control federal deficit relentlessly undermines the American way of life every day. Sadly there is no political will in America to do anything about it. Reform, when it comes, will be forced on America and the world by the collapse of the fiat currencies.
The best way to help the poor is not to become one of them
Lang Hancock. Australian mining magnate
Federal budget gap tops $1 trillion through June
Federal budget gap through June tops $1 trillion amid GOP resistance to more gov't spending
Martin Crutsinger, AP Economics Writer, On Tuesday July 13, 2010, 7:02 pm EDT
WASHINGTON (AP) -- The federal deficit has topped $1 trillion with three months still to go in the budget year, showing the lasting impact of the recession on the government's finances.
In its monthly budget report, the Treasury Department said Tuesday that through the first nine months of this budget year, the deficit totals $1 trillion. That's down 7.6 percent from the $1.09 trillion deficit run up during the same period a year ago.
Worries about the size of the deficit have created political problems for the Obama administration. Congressional Republicans and moderate Democrats have blocked more spending on job creation and other efforts. Republicans also have held up legislation to extend unemployment benefits for the long-term jobless because of its effect on the deficit.
Another failed effort would have provided cash-starved states with money to help avoid layoff of public employees and finance the Medicaid program for the poor and disabled.
President Barack Obama also encountered resistance to further stimulus spending at a meeting of the Group of 20 major industrial nations last month in Toronto.
Obama expressed concerns about the risks to a fragile global recovery from withdrawing spending too soon. But the G-20 adopted targets to cut deficits in half as a percentage of their economies over three years.
The deficit in the federal budget in June totaled $68.4 billion, the second highest June deficit on record, but down from the all-time high of $94.3 billion in June 2009, a month when the government was spending heavily to stabilize the financial system and jump-start economic growth.
June is normally a surplus month as the government collects tax payments from corporations and individuals who make quarterly payments. Only seven years in the past 56 have seen deficits in June.
http://finance.yahoo.com/news/Federal-budget-gap-tops-1-apf-3046787518.html?x=0&.v=13
Staying with America, the FT covers the death of a Presidency. In fairness, the problems were so great that whoever got the job was likely to fail. However, when the leader of the free world gets international press like this, effectively there isn’t any leadership to the free world. Below, the FT on the prospect of President Obama becoming a lame duck one-timer President after November’s election. Will the President’s team opt for a September or October surprise? Anything is possible I suppose, but does America really need another war it can’t pay for?
Always back the horse named self-interest, son. It’ll be the only one trying
Jack Lang – Australian Prime Minister.
Obama faces growing credibility crisis
By Edward Luce in Washington Published: July 13 2010 18:51
Robert Gibbs, Barack Obama’s chief spokesman, got into hot water this week for daring to speak the truth – that the Democrats could lose control of the House of Representatives in November. But it could be even worse than that.
Contrary to pretty much every projection until now, Democratic control of the Senate is also starting to coming into question. While Mr Obama’s approval ratings have continued to fall, and now hover at dangerously close to 40 per cent according an ABC-Washington Post poll published on Tuesday, the fate of his former colleagues in the Senate looks even worse.
In the past few days polls have shown Republican challengers taking the lead over previously safe Democratic incumbents, such as Barbara Boxer in California and Russ Feingold in Wisconsin. Indeed, given the uniformly negative direction in the numbers, it is now quite possible the Republicans could win the Senate seats formerly held by both President Obama in Illinois, and Joe Biden, vice-president, in Delaware.
Add to that the continuing woes of Harry Reid, the Senate Democratic majority leader, in Nevada, where the Republican party’s recent nomination of Sharron Angle, a far-right and highly eccentric Tea Party supporter, appear to have had no positive effect on Mr Reid’s prospects, and the Grand Old party has a good shot at taking control of both houses of Congress. Worse for Mr Obama, political scientists say that at this stage in the calendar, there is almost nothing he can do about it.
“If you ask me where the silver lining is for President Obama, I have to say I cannot see one,” says Bill Galston, a former Clinton official, who has been predicting for months the Democrats could lose the House. “Just as BP’s failure to cap the well has been so damaging, Obama’s failure to cap unemployment will be his undoing. There is nothing he can do to affect the jobless rate before November.”
The direction of the data could hardly be worse. According to Democracy Corps, a group headed by Stanley Greenberg, a liberal pollster who is a close friend of Rahm Emanuel, Mr Obama’s chief of staff, a majority of US citizens see Mr Obama as “too liberal”.
Astonishingly, 55 per cent of citizens think Mr Obama is a “socialist” against only 39 per cent who do not share that diagnosis. The same poll shows 48 per cent support for Republicans against just 42 per cent for Democrats. The numbers are eerily similar to 2006, except that it was George W. Bush’s Republicans who were on the receiving end four years ago.
“The bottom line here is that Americans don’t believe in President Obama’s leadership,” says Rob Shapiro, another former Clinton official and a supporter of Mr Obama. “He has to find some way between now and November of demonstrating that he is a leader who can command confidence and, short of a 9/11 event or an Oklahoma City bombing, I can’t think of how he could do that.”
In private, informal advisors to Mr Obama are almost as negative. According to one, the US public’s loss of confidence in Mr Obama’s leadership is a factor above and beyond their dissatisfaction over the state of the real economy, which continues to slow as last year’s $787bn stimulus starts to run dry. The adviser, who asked to remain anonymous, said the public did not know what Mr Obama really believed.
----Next week, Mr Obama is likely to sign a historic Wall Street re-regulation bill into law. Earlier this year he did the same for healthcare. But polls show the public either does not care, or even opposes these otherwise big reforms. “The longer this goes on, the more it looks like Obama wasted his first year on healthcare,” said the outside adviser. “It’s still the economy, stupid.”
http://www.ft.com/cms/s/0/434315b2-8ea6-11df-8a67-00144feab49a.html
We leave the last word on America this morning to the NY Times. Below the NYT on what passes in DC for reforming the Squids. From far away London, this cure looks as bad as the disease it seeks to cure. More bureaucracy heaped on bureaucracy, with no attempt at reforming the currency, the deficit, the Wall Street crony too big to fail Squids. With the “next Lehman” speeding towards its collapse, though this time round it probably won’t be an American company, 2011 looks to be a bad year to inaugurate gridlock in Washington.
"God, no, we don't club baby seals. We club babies."
Goldmanite. The Times of London. November 8 2009.
Financial Reform Bill Limps Toward Vote
By DAVID M. HERSZENHORN Published: July 13, 2010
WASHINGTON — It was supposed to be the one major piece of legislation this year that Republicans and Democrats could see eye to eye on, and vote aye on together in broad numbers. Instead, the sweeping overhaul of the nation’s financial regulatory system, a response to the economic crisis of 2008, will barely squeak through the Senate.
Senate Democrats on Tuesday said they had cobbled together the bare minimum of 60 votes needed to close off debate and advance to a final vote later this week. Supporters included three Republican centrists from the Northeast, Senator Scott Brown of Massachusetts, Susan Collins of Maine and Olympia J. Snowe, also of Maine.
The three Republicans may be joined by others, but the bill is still certain to fall far short of the wide bipartisan majority that some Congressional leaders had predicted given the unanimous agreement among lawmakers in both parties that the rules for Wall Street needed to be rewritten.
In the House, only three Republicans supported the bill. “I think it’s just the times we’re in,” said Senator Christopher J. Dodd, Democrat of Connecticut and chairman of the banking committee, a main author of the legislation along with Representative Barney Frank, Democrat of Massachusetts and chairman of the Financial Services Committee.
With a fiercely competitive midterm election cycle under way, the shared goal of tightening regulation of the financial industry gave way to charges by Republicans that Democrats were overextending the reach of government and failing to address the root cause of the crisis by not dealing with the mortgage giants Fannie Mae and Freddie Mac.
Democrats levied countercharges that Republican Congressional leaders were more interested in blocking President Obama’s legislative agenda and denying Democratic lawmakers the ability to boast of another achievement during the fall campaign than they were in safeguarding the financial system and protecting consumers.
In the end, even lawmakers known for working across the aisle said they were perplexed — and discouraged — that the financial regulation bill ultimately did not generate wider bipartisan support.
-----The bill seeks to avert future crises by giving government regulators the power to seize control of failing financial institutions, break them apart, sell off the assets and put them out of business, with shareholders and creditors taking losses.
The legislation would create a system risk council comprising the most senior government regulators to try to identify potential dangers in the financial system. It would create a powerful consumer financial protection bureau to be housed in the Federal Reserve and would impose a new regulatory framework on the trading of derivatives, the complex instruments that were at the center of the 2008 downturn.
The bill would also strengthen the Securities and Exchange Commission by giving it new authority over credit rating agencies, hedge funds and private equity companies.
-----The Senate majority leader, Harry Reid of Nevada, said Republicans had turned their backs on Americans by voting against the financial regulatory bill and by blocking an extension of unemployment benefits.
“Wall Street reform is preventive care; unemployment insurance is emergency care,” Mr. Reid said, adding, “I’m grateful that a few brave Republicans are doing the right thing for our country, but it’s still disappointing that you can count on one hand the number of Republicans willing to fix the system that caused the recession.”
A procedural vote on ending debate is scheduled for Thursday morning, and Mr. Reid expressed hope that a final vote could be held later that day. If Republicans object, he said, the vote could be scheduled for Saturday — a highly unlikely prospect in the summer of a midterm campaign year.
http://www.nytimes.com/2010/07/14/business/14regulate.html?_r=1&ref=business
Well not quite the last word. Below, Toyota blames US drivers for all the problems of sticking accelerators and failing brakes. An unusual way of drumming up sales, nevertheless. Actually it’s the Department of Transportation that’s doing the blaming, so I suspect that poor President Obama’s poll numbers are likely to fall again. My cheap suggestion for a quick fix, put a sticker on the windscreen, “brakes on the left, gas on the right,” and just make sure that Toyota buyers can read before selling them a car. Somehow, I don’t see America’s tort bar letting the DOT have the last word.
I know what's wrong, and if I could find it, I'd fix it.
Anon.
JULY 13, 2010
Early Tests Pin Toyota Accidents on Drivers
The U.S. Department of Transportation has analyzed dozens of data recorders from Toyota Motor Corp. vehicles involved in accidents blamed on sudden acceleration and found that the throttles were wide open and the brakes weren't engaged at the time of the crash, people familiar with the findings said.
The early results suggest that some drivers who said their Toyotas and Lexuses surged out of control were mistakenly flooring the accelerator when they intended to jam on the brakes.
But the findings—part of a broad, ongoing federal investigation into Toyota's recalls—don't exonerate the car maker from two known issues blamed for sudden acceleration in its vehicles: "sticky" accelerator pedals that don't return to idle and floor mats that can trap accelerators to the floor.
The findings by the National Highway Traffic Safety Administration involve a sample of the reports in which a driver of a Toyota vehicle said the brakes were depressed but failed to stop the car from accelerating and ultimately crashing.
A NHTSA spokeswoman declined to comment on the findings, which haven't been released by the agency.
The data recorders analyzed by NHTSA were selected by the agency, not Toyota, based on complaints the drivers had filed with the government. Toyota hasn't been involved in interpreting the data.
The initial findings are consistent with a 1989 government-sponsored study that blamed similar driver mistakes for a rash of sudden-acceleration reports involving Audi 5000 sedans.
The Toyota findings appear to support Toyota's position that sudden-acceleration reports involving its vehicles weren't caused by electronic glitches in computer-controlled throttle systems, as some safety advocates and plaintiffs' attorneys have alleged. More than 100 people have sued the car maker over crashes they claim were the result of faulty electronics.
It is unknown how many data recorders NHTSA has read so far. The agency's investigators have been reading the data only since Toyota provided the agency with 10 reading devices in March.
Since then, investigators have responded to accidents involving sudden acceleration when the driver claims to have been stepping on the brakes.
Because the data recorders can lose their information if disconnected from the car's battery or if the battery dies—as could happen after a crash—the agency is focusing only on recent accidents, said a person familiar with the situation.
Normal service resumes tomorrow, with more on those impulsive, socialist, work shy, tax dodging, irascible Europeans. From the continent made for tanks, more on the unloved, one [German] size fits all, Euro. Coming soon thanks to the Greeks, buy one get one free.
If a part can be installed incorrectly, it will be.
Murphy's Law
At the Comex silver depositories Tuesday, final figures were: Registered 52.47 Moz, Eligible 60.11 Moz, Total 112.58 Moz.
+++++
Crooks and Scoundrels Corner.
The bent, the seriously bent, and the totally doubled over.
No crooks or scoundrels today, just Fatso the kind hearted Aussie “saltie” and below that the classic news clip from the 1970s Oregon.
Some mistakes are too much fun to only make once
Anon
Police: Drunk Australian bitten by 'Fatso' the crocodile after trying to sit on animal's back
Published July 12, 2010 Associated Press
PERTH, Australia (AP) — A man ejected from a pub in Australia broke into a zoo and climbed onto the back of a crocodile named Fatso, which bit him on the leg but then let him go. Police say they're surprised the croc didn't inflict worse damage.
The 36-year-old man, who police said had just been thrown out of a pub for being drunk, told officials he scaled the barbed wire fence surrounding the Broome Crocodile Park in remote northwest Australia on Monday night because he wanted to give the 16-foot (5 meter) Fatso a pat.
"He has attempted to sit on its back and the croc has taken offense to that and has spun around and bit him on the right leg," Broome Police Sgt. Roger Haynes said.
The saltwater crocodile then inexplicably let the man go, and he climbed back over the fence to safety, police said.
The man, who was a tourist from eastern Australia and whose name was not released, suffered some "very nasty lacerations" and was taken to a hospital, Haynes said.
"Saltwater crocodiles ... once they get hold of you, are not renowned for letting you go," Haynes said. "He's lucky to have escaped with his life."
Saltwater crocodiles are the world's largest reptile and can grow up to 23 feet (7 meters). They have become increasingly common in Australia's tropical north since hunting that almost extinguished the species was banned in 1971
Drunken Aussies are probably too tough to eat, even for Australia’s fearsome salties, even the non drunk ones are tough enough, as Germany’s Sebastian Vettel found out last Sunday when Australia’s Mark Webber got mad at his second class team treatment and trounced Herr Vettel in style. Probably Fatso was just waiting for some sweet tasting whinging Pom to drop by, the outcome would probably have been one less whinging Pom.
May as well be here as where we are.
Australian Aboriginal saying
The world famous 1970s classic: Oregon’s Exploding Whale.
http://www.youtube.com/watch?v=AtVSzU20ZGk
The monthly Coppock Indicators finished June:
DJIA: +269 Down. NASDAQ: +460 Down. SP500: +290 Down.
The bull market (or bear market rally) that commenced on Nasdaq on 30/4/09 at 1717 has ended. (30/5/09 SP 500 at 919, 30/5/09 DJIA 8500.) While the indicators can flip flop at market turns, this action is rare on the slow monthly indicators.
Help the LIR fight Banksterism, the EU, and for sound money.
If you can, help the LIR stay around and make a difference. Please make a donation at the PayPal link on the website or better still become a sponsor for what looks like an exciting 2010. Capitalism not banksterism. Many thanks to all who have helped.
+++++
Sunspots – A 22 year colder world? (From 2004?)
Spotless Days July 13
Current Stretch:0 days
2010 total: 35 days (18%)
2009 total: 260 days (71%)
Since 2004: 803 days
Typical Solar Min: 485 days
The long minimum seems to have ended, or has it? Despite the record and near record heat waves sweeping the northern hemisphere, I’m beginning to think our new Dalton Minimum of arriving global cooling, might turn out in fact to be a much longer more severe Maunder Minimum. More on the Sunspot page on the website.
No comments:
Post a Comment