Baltic Dry Index. 2881 +05
LIR Gold Target by 2019: $3,000.
At around 4:00 PM on that September day, 348 German bombers escorted by 617 fighters blasted London until 6:00 PM. Two hours later, guided by the fires set by the first assault, a second group of raiders commenced another attack that lasted until 4:30 the following morning.
This was the beginning of the Blitz - a period of intense bombing of London and other cities that continued until the following May. For the next consecutive 57 days, London was bombed either during the day or night.
September 7th 1940
Yesterday President Obama announced a blitz of sorts to get the US economy working again. As blitzes go it was underwhelming, though the NY Times is sceptical it will even get passed.
I have always felt that a politician is to be judged by the animosities he excites among his opponents.
Sir Winston Churchill.
Obama Offers a Transit Plan to Create Jobs
By SHERYL GAY STOLBERG and MARY WILLIAMS WALSH Published: September 6, 2010
MILWAUKEE — President Obama, looking to stimulate a sluggish economy and create jobs, called Monday for Congress to approve major upgrades to the nation’s roads, rail lines and runways — part of a six-year plan that would cost tens of billions of dollars and create a government-run bank to finance innovative transportation projects.
With Democrats facing an increasingly bleak midterm election season, Mr. Obama used a speech at a union gathering on Labor Day, the traditional start of the campaign season, to outline his plan. It calls for a quick infusion of $50 billion in government spending that White House officials said could spur job growth as early as next year — if Congress approves.
That is a big if. Though transportation bills usually win bipartisan support, hasty passage of Mr. Obama’s plan seems unlikely, given that Congress has only a few weeks of work left before lawmakers return to their districts to campaign and that Republicans are showing little interest in giving Democrats any pre-election victories.
Central to the plan is the president’s call for an “infrastructure bank,” which would be run by the government but would pool tax dollars with private investment, the White House says. Mr. Obama embraced the idea as a senator; with unemployment still high despite an array of government efforts, the concept has lately been gaining traction in policy circles and on Capitol Hill.
Indeed, some leading proponents of such a bank — including Gov. Arnold Schwarzenegger, Republican of California; Gov. Ed Rendell, Democrat of Pennsylvania; and Michael R. Bloomberg, the independent mayor of New York — would like to see it finance a broader range of projects, including water and clean-energy projects. They say such a bank would spur innovation by allowing a panel of experts to approve projects on merit, rather than having lawmakers simply steer transportation money back home.
“It will change the way Washington spends your tax dollars,” Mr. Obama said here, “reforming the haphazard and patchwork way we fund and maintain our infrastructure to focus less on wasteful earmarks and outdated formulas, and more on competition and innovation that gives us the best bang for the buck.”
But the notion of a government-run bank — indeed, a government-run anything — is bound to prove contentious during an election year in which voters are furious over bank bailouts and over what many perceive as Mr. Obama pursuing a big government agenda. Even before the announcement Monday, Republicans were expressing caution.
http://www.nytimes.com/2010/09/07/us/politics/07obama.html?hpw
Improving transportation infrastructure, may or may not be a good idea, depending on whether it becomes a hidden subsidy to a transportation special interest, and I’m skeptical that setting up a government run bank is the right way to go and won’t simply degenerate into jobs for the boys and money for special interest groups, but even assuming it wouldn’t, tossing in an extra $50 billion over a year into a US economy of 14.4 trillion, is simply meaningless. It’s not big enough to make any difference.
Back across the Atlantic, where the world owes everyone a living starting with the three Presidents who head up the “United States of Europe”, has anyone seen Baroness Whats-it recently, Gordon Brown’s Scots joke on the EU’s no expense spared “diplomatic service”, the Brits and the French are getting a re-run of the 1960s and 70s. How we all had such fun as the garbage piled up in the streets, power became rationed, and in France Charles de Gaulle was banished by student rioters into exile in Ireland. Stay long precious metals. This is only the beginning, austerity has hardly kicked in yet.
Strikers in Paris and London Snarl Travel
By THE ASSOCIATED PRESS Published: September 7, 2010
PARIS — French unions started a major strike on Tuesday over unpopular conservative President Nicolas Sarkozy’s plans to raise the retirement age from 60 to 62, with walkouts causing headaches for travelers and commuters.
More than 200 street demonstrations were scheduled throughout France during the one-day movement. Civil aviation authorities asked airlines to cut a quarter of flights at Paris’ airports. Only two out of five fast trains are scheduled to run, and traffic was slowed on subway and suburban transport lines in Paris.
The strike coincides with the start of debate in Parliament over a plan to overhaul the money-losing pension system so it will break even in 2018. The government insists the reform is essential as people live longer, and it has urged people to show “courage” as it tries to chip away at the huge national debt.
Unions say the government is attacking one of France’s most cherished social protections — though a retirement age of 62 would still be among the lowest in Europe. Neighboring Germany, for example, has decided to bump up the retirement age from 65 to 67.
Unions hope to mobilize 2 million street demonstrators at a time when Mr. Sarkozy’s approval ratings hover in the mid-30 percent range. A similar effort on June 24 drew nearly 800,000 protesters.
Labor Minister Eric Woerth has said the government will press ahead with the reform no matter how strong the protest turnout is. Leftist political parties, as well as student associations, have urged members to join in.
The SNCF rail network says travelers can expect 40 percent of TGV fast trains to run, and 80 percent of Thalys trains to Belgium and the Netherlands will not be affected. Eurostar trains to Britain are expected to run normally.
But travelers arriving in London faced further headaches as workers on the struck over proposed job cuts.
Members of two unions walked off the job for 24 hours beginning on Monday evening’s rush hour. The fight focuses on plans to cut 800 jobs, mainly in station ticket offices. But Transport for London, which runs the Underground — known commonly as the Tube — says there will be no compulsory layoffs.
Traffic will vary on the Paris subway, with only one out of two or one out of three trains operating on many lines, the transport authority said. Three buses out of four are expected to circulate. Some suburban trains will be hard-hit: There will be almost no traffic on the RER B line that air travelers take to and from the city, for example.
http://www.nytimes.com/2010/09/08/world/europe/08france.html?hp
Anyone thinking of coming to London for the 2012 Olympics, might want to plan on the communist lead RMT union having London Underground on strike during the games.
We end for today with Australia getting a new socialist government dependent on setting a green agenda. Good luck Bruce and Sheila! Some parts of the green agenda actually make sense, especially if megawatt grid storage now rolling out for full scale testing, manages to turn intermittent power from solar and wind, into on demand base power just like that from conventional power stations. The trouble is that Australia is now very likely to get hit with every nutty green energy scam going, from industry hurting carbon taxes to Wall Street’s favourite carbon futures trading, and all in the name of saving the planet from man-made global warming from CO2, now rebranded “climate change” after the public woke up to the dodgy science that came out of the University of East Anglia’s Climate Research Unit. Suffering a socialist government is bad enough, suffering one blackmailed by a green agenda is a calamity. It puts a cloud over investing in Oz.
A week is a long time in politics.
Prime Minister Harold Wilson.
Australian Labor Party to Form Government
By MERAIAH FOLEY Published: September 7, 2010
SYDNEY, Australia — Two independent lawmakers said on Tuesday they will support Australian Prime Minister Julia Gillard, giving the center-left government a second term and ending more than two weeks of political impasse.
In a dramatic piece of political theater, Rob Oakeshott and Tony Windsor told a room packed with reporters that they would support Ms. Gillard’s government, giving her Labor party a one-vote majority of 76 lawmakers in the 150-seat House of Representatives.
The announcements by Mr. Windsor and Mr. Oakeshott in Canberra, the capital, came after a third independent lawmaker, Bob Katter, earlier in the day threw his support behind Australia opposition conservative leader, Tony Abbott.
----- Mr. Windsor said Labor’s proposals on climate change and creating one of the world’s fastest and widest-reaching broadband Internet networks was critical in winning his support.
The three independents had vowed to try to vote together as a bloc. But Mr. Katter said he decided to announce his own position rather than continue negotiations with the other two.
Earlier on Tuesday, Mr. Katter said he decided to support Mr. Abbott over Ms. Gillard after assessing both candidates’ responses to a 20-point “wish list” on a range of economic and social issues, including greater tariffs on food imports and increased investment in irrigation systems.
Mr. Katter’s sprawling northern Queensland electorate represents mainly agricultural and mining interests. He has been an outspoken critic of Ms. Gillard’s plan to impose a new tax on mining profits and opposes charging polluters for their greenhouse gas emissions.
---- Ms. Gillard and Mr. Abbott had been wooing the support of independent or minor party lawmakers since the election on Aug. 21 failed to deliver a parliamentary majority to either candidate.
Last week Ms. Gillard won the support of two of the five lawmakers, independent Andrew Wilkie and Adam Bandt of the Greens Party.
http://www.nytimes.com/2010/09/08/world/asia/08australia.html?_r=1&hp
"When I warned them (the French Government) that Britain would fight on alone whatever they did, their generals told their Prime Minister and his divided Cabinet, 'In three weeks England will have her neck wrung like a chicken.' Some chicken! Some neck! "
Prime Minister Churchill. Canada December 1941.
At the Comex silver depositories Friday, final figures were: Registered 51.83 Moz, Eligible 58.88 Moz, Total 110.71 Moz.
+++++
Crooks and Scoundrels Corner.
The bent, the seriously bent, and the totally doubled over.
The vampire squids again, how "God's work", meant killing off Lehman.
“The explanation is that a double standard exists. The wealthy get bailed out – the creditors, not the debtors. And even the fraudsters, not their victims.”
Is the Economy as Broke as Lehman Was?
September 4, 2010
The Angelides Committee Sidesteps the Mortgage Fraud Issue
What is the difference between today’s economy and Lehman Brothers just before it collapsed in September 2008? Should Lehman, the economy, Wall Street – or none of the above – be bailed out of bad mortgage debt? How did the Fed and Treasury decide which Wall Street firms to save – and how do they decide whether or not to save U.S. companies, personal mortgage debtors, states and cities from bankruptcy and insolvency today? Why did it start by saving the richest financial institutions, leaving the “real” economy locked in debt deflation?
Stated another way, why was Lehman the only Wall Street firm permitted to go under? How does the logic that Washington used in its case compare to how it is treating the economy at large? Why bail out Wall Street – whose managers are rich enough not to need to spend their gains – and not the quarter of U.S. homeowners unfortunate enough also to suffer “negative equity” but not qualify for the help that the officials they elect gave to Wall Street’s winners by enabling Bear Stearns, A.I.G., Countrywide Financial and other gamblers to pay their bad debts?
There was disagreement last Wednesday at the Financial Crisis Inquiry Commission hearings now plodding along through its post mortem on the causes of Wall Street’s autumn 2008 collapse and ensuing bailout. Federal Reserve economists argue that the economy – and Wall Street firms apart from Lehman – merely had a liquidity problem, a temporary failure to find buyers for its junk mortgages. By contrast, Lehman had a more deep-seated “balance sheet” problem: negative equity. A taxpayer bailout would have been an utter waste, not recoverable.
Only a “liquidity problem,” or a balance sheet problem of negative equity?
Lehman CEO Dick Fuld is bitter. He claims that Lehman was unfairly singled out. After all, the Fed lent $29 billion to help JP Morgan Chase buy out Bear Stearns the preceding spring. In the wake of Lehman’s failure it seemed to gain the courage to say, “Never again,” and avoided new collapses by bailing out A.I.G. – saving all its counterparties from having to take a loss.
Was this not a giveaway? Mr. Fuld implied. Why couldn’t the Fed and Treasury do for Lehman what they did with other Wall Street investment firms and stock brokers: let it reclassify itself as a bank so it could pawn off its junk mortgages at the Fed’s discount window for 100 cents on the dollar, sticking taxpayers with the loss? (And by the way, will these firms ever be asked to buy back these mortgages at the price they borrowed against from the government? Or will they be allowed to walk away from their debts in a Wall Street version of “jingle mail”?)
More.
http://michael-hudson.com/2010/09/is-the-economy-as-broke-as-lehman-was/
“Recent federal bankruptcy proceedings have exposed Lehman’s deceptive off-balance-sheet accounting gimmicks such as Repo 105 to conceal its true position. No fraud charges have yet been levied, but this is the invisible elephant in the Washington committee rooms. “Everyone was doing it,” so that makes it legal – or what is the same thing these days, non-prosecutable in practice. To prosecute would be to disrupt the financial system – and it is Fed doctrine that the economy cannot survive without a financial system enabled to “earn its way out of debt” by raking off the needed wealth from the rest of the economy?”
The monthly Coppock Indicators finished August:
DJIA: +243 Down. NASDAQ: +366 Down. SP500: +243 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. August is the third down month in a row and “crash season” approaches.
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