Weekday NEWS to Comfort the Disturbed and Disturb the Comfortable.

Tuesday 08.31.2010

The Summer the Recovery Went Missing
By Bill Bonner - DailyReckoning.com
08/30/10 Paris, France - Let's see, what happened this summer? Easy question. The recovery went missing.
Ben Bernanke said so last weekÉor almost. He noted that the economy wasn't quite as spiffy as he had hoped and that the Fed stands ready, willing, and able to provide more help.
The stock market liked the news. After falling for many days, it rallied 164 points on Friday. Gold was flat.
The New York Times reports:
THE American economy is once again tilting toward danger. Despite an aggressive regimen of treatments from the conventional to the exotic - more than $800 billion in federal spending, and trillions of dollars worth of credit from the Federal Reserve - fears of a second recession are growing, along with worries that the country may face several more years of lean prospects.

Figuring out the Real Importance of Gold
By Rocky Vega - DailyReckoning.com
08/30/10 Stockholm, Sweden - Gold remains in high demand among individual investors, hedge funds, and central banks all swapping cash for the yellow metal. This past weekend, an FT reportage looked into what the latest money flows into gold can tell us about it's real importance.
Among others, the Financial Times spoke with Texas Republican Congressman Ron Paul:

"'We were in a financial crisis and inflation was high,' Paul recalls. 'But the Federal Reserve wasn't interested. I remember Paul Volcker [then president of the Federal Reserve] walking into a room in 1980 - at the height of the financial crisis, when gold went up to more than $800 per ounce - and saying, "What's the price of gold?"' According to Paul, 'Everyone knows a high gold price is a vote of no-confidence in paper. That is why governments will manipulate and try to give you an artificial price for gold.'

Gold Poised for Biggest Monthly Advance Since April on Demand
By Kim Kyoungwha
Aug. 31 (Bloomberg) -- Gold is set for the biggest monthly advance since April as signs that the global economic recovery may be faltering prompt investors to boost their holdings to try to preserve their wealth.
Gold for immediate delivery was little changed at $1,236.90 an ounce at 9:15 a.m. in Singapore, having climbed 4.7 percent this month. The metal reached a record $1,265.30 in June. The December contract was also little changed today at $1,237.70.

Gold Bullion Likely to Pull Back Then Rocket Higher
By David Banister - Minyanville.com
Back in late June I forecasted a big top in gold, mostly due to the five wave structures up from the October 2008 lows to June highs, and the five waves up from February lows to June highs converging. We then dropped from $1243 at the time of the forecast to $1155, which was one of my potential "A wave down" rally pivots. I expected a countertrend rally or "B" wave up to $1212-1225. So, all of that worked out pretty well, until we hit $1238. Now, $1238 is a 78% Fibonacci retracement of the drop from $1265 to $1155. Normally, a retracement in a weaker market or sector is capped at 61.8% or 50%.
The strength of that countertrend move caused me to go back and review my patterns a few more times. Most of this is pure instinct and experience, but I think $1155 was the low of the correction. It also looks like that was an ABC correction to $1155, and with the strong rally, it means we're likely beginning a new set of five waves up from $1155.

The Death Of Cash?
All Over The World Governments
Are Banning Large Cash Transactions
TheEconomicCollapseBlog.com
Are we witnessing the slow but certain death of cash in this generation? Is a truly cashless society on the horizon? Legislation currently pending in the Mexican legislature would ban a vast array of large cash transactions, but the truth is that Mexico is far from alone in trying to restrict cash. All over the world, governments are either placing stringent reporting requirements on large cash transactions or they are banning them altogether. We are being told that such measures are needed to battle illegal drug traffic, to catch tax evaders and to fight the war on terror. But are we rapidly getting to the point where we will have no financial privacy left whatsoever? Should we just accept that we have entered a time when the government will watch, track and trace all financial transactions? Is it inevitable that at some point in the near future ALL transactions will go through the banking system in one form or another (check, credit card, debit card, etc.)?

Failed bank's 'White House' for sale
By J. Scott Trubey - The Atlanta Journal-Constitution
Who says the White House can't be bought?
No, not the real one, nor even the famous Atlanta replica off Briarcliff Road.
This White House is the former home of the failed American United Bank in Lawrenceville. And it's on the market, though a price hasn't been set.
The 13,000-square foot bank building, modeled after the president's residence, lacks the Oval Office and stately Rose Garden, but 1888 Old Norcross Road does have something 1600 Pennsylvania Ave. doesn't: a drive-through window.

Why Bernanke's attempts to fix the economy are only a façade
By Eric Fry - DailyReckoning.com
08/30/10 Laguna Beach, California - America has an economy that produces about $13 trillion of activity each year. America also has a Federal Reserve Chairman that produces about 13 trillion raised eyebrows each year.
Last week, in Jackson Hole, Wyoming, Bernanke raised a few more eyebrows by asserting that the Federal Reserve remains in control - more or less - of economic conditions here in the United States.

Is Ben Lost?
by Andrew Butter - LewRockwell.com
The much awaited speech by Ben Bernanke, on Friday, was a bit of a non-event. It was interesting, however, to see the 30-year bounce, from 3.55% to 3.7%, the moment that Ben explained his cunning plan to push long-term interest rates down. But at least we learned that $140 billion of the $1.25 billion the Fed advanced to buy agency debt and MBS, got repaid.
One question Ben: "How much did you pay for the $140 billion that got repaid? Did you make a profit, or are you going to wait until Ron Paul's audit before you let us know how that went?."

***** Timely interview *****

Interesting take on the American economic situation from the Asian point of view by Canadian, Benjamin Fulford, in Japan. The whole financial system needs 'rebooting' and it will happen. Decisions are being made now, and this financial expert has some excellent ideas about how to deal with America's 204 trillion dollar debt through restructuring and issuing new currency (not the Amero) - listen to the 3rd segment, if nothing else. . .

Benjamin Fulford on Rense - August 25 2010 Part 1/3

Benjamin Fulford on Rense - August 25 2010 Part 2/3

Benjamin Fulford on Rense - August 25 2010 Part 3/3

Backlash over China curb on metal exports
By Ambrose Evans-Pritchard - Telegraph.co.uk
China's draconian export curbs on rare earth minerals needed by the rest of the world for frontier technologies is escalating into a serious diplomatic and trade clash with the United States and other leading powers.
Japan's foreign minister Katsuya Okada issued what amounted to a formal protest at top-level meeting with Chinese officials in Beijing over the weekend, saying the sudden cut-off was "affecting the global production chain".
It is the latest sign of rising pressure after angry complaints by companies outside China that rely on this family of 17 metals for hybrid cars, mobile phones, superconductors, navigation, and a host of high-tech industries.

Lehman Derivatives Records a 'Mess,' Barclays Executive Says
By Linda Sandler
Aug. 30 (Bloomberg) -- Barclays Plc had no idea how big Lehman Brothers Holdings Inc.'s futures-and-options trading business was when it considered taking over the defunct bank's derivatives trades at exchanges in 2008, a Barclays executive said.
"Lehman's books were in such a mess that I don't think they knew where they were," Elizabeth James, a director of Barclays's futures business, testified today in U.S. Bankruptcy Court in Manhattan. James worked on Barclays's purchase of Lehman's brokerage during the 2008 financial crisis.

Treasuries Set for Longest Monthly Winning Streak Since 2008
By Candice Zachariahs and Wes Goodman
Aug. 31 (Bloomberg) -- Treasuries headed for a fifth monthly gain, the longest winning streak since March 2008, before reports this week forecast to show employers cut jobs for a third month and manufacturing growth slowed.
Two-year note yields were within five basis points of a record low before the Institute for Supply Management is predicted to say tomorrow that factories in the U.S. expanded at the weakest pace in close to a year. The unemployment rate rose in August, the Labor Department will likely say Sept. 3.

Financial Crises Linked to Central Bank Stupidity
By The Mogambo Guru - DailyReckoning.com
08/30/10 Tampa, Florida - It was an interesting psychological phenomenon when I read where Michael Kosares of USAGold.com wrote, "Private citizen, Alan Greenspan, could afford to be blunt," but I interpreted it in my Mysterious Mogambo Mind (MMM) to mean, "Private citizen, Alan Greenspan, should be afforded a blunt instrument applied with extreme prejudice to his stupid head, over and over, as he is the moron that, as chairman of the Federal Reserve from 1987-2006, created all the money and credit to finance the now-busting booms in stocks, booms in bonds, booms in houses, booms in derivatives, and booms in the size and cost of governments, and if there is one sorry, worthless bastard who can be singled out as guilty, guilty, guilty, it is Alan Greenspan."

China: Rumors of the Central Bank Chief's Defection
Stratfor Global Intelligence
Rumors have circulated in China that People's Bank of China (PBC) Gov. Zhou Xiaochuan may have left the country. The rumors appear to have started following reports on Aug. 28 which cited Ming Pao, a Hong Kong-based news agency, saying that because of an approximately $430 billion loss on U.S. Treasury bonds, the Chinese government may punish some individuals within the PBC, including Zhou. Although Ming Pao on Aug. 30 published a report on its website indicating that the prior report was fabricated by a mainland news site that had attributed the false information to Ming Pao, rumors of Zhou's defection have spread around China intensively, and Zhou's name has been blocked from Internet search engines in China.

Obama Calls for Congress to Pass Small-Business Bill
As Soon As Possible
By DANNY KING - DailyFinance.com
In an attempt to help spur hiring and cut the unemployment rate, President Barack Obama on Monday pushed Congress to make the small-business bill a priority when it returns from summer break next month, the Associated Press reported.
The package of tax cuts and incentives intended to help small businesses is "fully paid for," said Obama, who referred to Senate Republicans' opposition to it as "partisan politics," according to the wire-service story.

Credit is finally available, but no one wants it
by Nin-Hai Tseng - CNNMoney.com
FORTUNE -- Finally, nearly two years after they were bailed out by Congress, big banks are beginning to ease lending standards for individuals and small businesses. But it's not exactly having the reception many believed it would. Just when credit becomes more available, there's little evidence of a surge in demand for it.
Since the financial crisis, banks have been blamed for slowing the pace of economic recovery because of their reluctance to lend. Unlike larger companies that can borrow from bond markets, small businesses and consumers mostly depend on loans from banks. Federal officials have said tight credit has kept households from spending more and small businesses from hiring more.

A year ago, cash-for-clunkers spurred sales, but did it work?
By Sharon Silke Carty, USA TODAY
DETROIT - When August auto sales come out Wednesday, it isn't going to be pretty.
The year-over-year sales decline for the month will look terrible - down an estimated 30% - because the comparison will be with the buying frenzy fueled last August by the government's cash-for-clunkers program.
The program gave as much as $4,500 to buyers who traded an older car or truck for a new car with higher fuel economy. Its aim was a shot in the arm for auto sales at a time when consumers were not buying because of growing job losses, bank failures, automaker bankruptcies and tight credit. Without that government boost, supporters say, the auto industry - and the U.S. jobs dependent on both domestic and foreign makers - would have imploded and dug the economy into an even deeper hole.
Did it work?

5 reasons why falling home prices will be good for the economy
Higher homes values does not mean higher home equity, financial sector profits back up to 30 percent of all corporate profits, the mortgage debt equation.
DoctorHousingBubble.com
A recent report shows that 11 million homeowners with a mortgage are underwater with a deep red line item on their household budget. Add into the mix those with less than 5 percent equity and we realize that 28 percent of all "homeowners" are either in a negative equity position or teetering close to it. States like California have negative equity rates of 33 percent thanks to the growth of highly questionable mortgage products. Yet California looks like a saint when compared to Nevada with an underwater rate of 68 percent! If we want to examine the core premise of the debate surrounding the bailouts, it is that higher home values by default are good for the economy. I would argue that having high home values as a mission is misguided if that is the only goal we are seeking (and that is basically what we have been doing for the last few years). In fact, the majority of Americans would benefit from lower home prices. A market with higher home values is only beneficial if incomes and the economy move along in synchronization. Popping the last few balloons of the housing bubble is a good thing for most. Let us examine five reasons why falling home prices will be a good thing for the economy moving forward.

Obama Administration Plans Mortgage Aid, HUD's Donovan Says
By Holly Rosenkrantz
Aug. 30 (Bloomberg) -- The Obama administration plans to set up an emergency loan program for the unemployed and a government mortgage refinancing effort in the next few weeks to help homeowners after home sales dropped in July, Housing and Urban Development Secretary Shaun Donovan said.
"The July numbers were worse than we expected, worse than the general market expected, and we are concerned," Donovan said on CNN's "State of the Union" program yesterday. "That's why we are taking additional steps to move forward."

Mortgage closing costs 37% higher
By Stephanie Armour, USA TODAY
A new federal rule this year requiring mortgage lenders to give borrowers reliable estimates of closing costs appears to be working - whether it's also costing borrowers more money is uncertain.
A recent survey by Bankrate.com found that, on average, origination and third-party fees on a $200,000 purchase mortgage added up to $3,741 - a 37% jump over last year's average of $2,739.
The fees can include appraisals, credit reports, a closing or settlement attorney and surveys.

One in Six Americans Is Now on Medicaid
By MELLY ALAZRAKI - DailyFinance.com
A record one in six Americans is on Medicaid, the government's health program for the poor, according to USA Today. And Medicaid is just one of several government anti-poverty programs that have seen large increases in caseloads and in costs.
Millions of Americans lost their jobs during the recession, and large numbers of those have lost their employee-sponsored health insurance, too. COBRA subsidies notwithstanding, those job losses have cost most the ability to pay for private health insurance as well.

Cash-Poor Governments Ditching Public Hospitals
By SUZANNE SATALINE - WSJ.com (free)
Faced with mounting debt and looming costs from the new federal health-care law, many local governments are leaving the hospital business, shedding public facilities that can be the caregiver of last resort.
Officials in Lauderdale County, Ala., this spring opted to transfer their 91-year-old Eliza Coffee Memorial Hospital and other properties to a for-profit company after struggling to satisfy an angry bond insurer.
"We were next to knocking on bankruptcy's door,'' said Rhea Fulmer, a Lauderdale County commissioner who approved the deal with RegionalCare Hospital Partners, of Brentwood, Tenn, but with trepidation. She said the county had no guarantee the company would improve care in the decades to come. "Time will tell.''

Huge verdict shakes up nursing home industry
By PAUL ELIAS - AP -
$677 million decision has advocates of tort reform taking notice
SAN FRANCISCO - During Cindy Cool's almost daily visits to the nursing home, she would routinely find her Alzheimer's-suffering father wearing urine-soaked clothes.
The Blue Lake, Calif. resident said it would take upwards of 20 minutes for the apparently short-handed staff of Eureka Healthcare and Rehabilitation to respond and help Cool clean her father. Other patients fared worse, she said.
"A lot of times I walked out of there crying because of the things I saw," Cool said an interview.
She provided key testimony before a Humboldt County jury last month slammed the owners of her father's nursing home with a $677 million verdict, sending shock waves through the industry and rekindling calls for tort reform.

Savings rate inches lower in July, U.S. data show
Consumers' spending outpaces growth in personal incomes
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) -- The savings rate for U.S. households fell in July to the lowest level in three months as spending outpaced income, the Commerce Department estimated Monday.
Consumer spending rose 0.4% in July while personal income increased 0.2%.
The report was mixed in terms of market expectations. Incomes rose less than the 0.3% expected, while spending was stronger than the 0.3% gain expected by economists surveyed by MarketWatch.
U.S. stocks opened moderately lower after the report. See Market Snapshot.

Thinking about raiding your 401(k) plan? Don't do it
By Sandra Block
It's no secret that millions of Americans haven't saved enough to finance a comfortable retirement. Now comes even more worrisome news: Thousands of workers are raiding their retirement-savings plans to pay their bills.
In the second quarter, a record 2.2% of participants in 401(k) plans managed by Fidelity Investments took hardship withdrawals from their savings, up from 2% a year earlier. In addition, 45% of participants who took a hardship withdrawal a year ago took another one in the second quarter.

Made in USA - For now
Despite the odds, these businesses have managed to stay truly all-American. But for how long?
Aegis Bicycles
Headquarters: Camden, Maine
Products: High-end bicycles
"Made in USA still matters." That is, and will remain Aegis' motto, even if it ultimately becomes the death knell for the company, promised owner Pete Orne.
Orne bought the business in 2004 and like so many domestic businesses, it's hanging on by a thread.
Three years ago, Aegis was selling about 800 frames a year for between $3,000 to $4,000 each, making as much as $3 million a year. Then the recession hit.

California students get tracking devices
by Alex - TheIntelHub.com
RICHMOND, Calif. - California officials are outfitting preschoolers in Contra Costa County with tracking devices they say will save staff time and money.
The system was introduced Tuesday. When at the school, students will wear a jersey that has a small radio frequency tag. The tag will send signals to sensors that help track children's whereabouts, attendance and even whether they've eaten or not.

Radio Frequency Identification (RFID)
a key part of the global surveillance society
a technological advancement over Nazi tattooing of prisoners
Radio Frequency ID chips will soon be in cash, credit cards, your drivers license, cheap crap at grocery stores, cars, car tires, possibly under your skin.
Wal-Mart is mandating its adoption by its suppliers, which will force all of corporate "america" to switch from bar codes, which merely track what kind of product something is, with RFID, which uses an 18 digit number to track which specific product it is. Bar codes track an model of car tire, RFID would track the specific tire -- which could then be cross-referenced in the great Homeland Insecurity Totalitarian Information Awareness uber-database. Simple RFID readers will probably be set up just about everywhere that will then read all RFID chips in the vicinity for plugging into the system. This is far, far more intrusive than the nightmarish vision of George Orwell's 1984.

Wal-Mart Radio Tags to Track Clothing
By MIGUEL BUSTILLO - WSJ.com July 23, 2010 (free)
Wal-Mart Stores Inc. plans to roll out sophisticated electronic ID tags to track individual pairs of jeans and underwear, the first step in a system that advocates say better controls inventory but some critics say raises privacy concerns.
Starting next month, the retailer will place removable "smart tags" on individual garments that can be read by a hand-held scanner. Wal-Mart workers will be able to quickly learn, for instance, which size of Wrangler jeans is missing, with the aim of ensuring shelves are optimally stocked and inventory tightly watched. If successful, the radio-frequency ID tags will be rolled out on other products at Wal-Mart's more than 3,750 U.S. stores.

Deadly denial of 'Core Exit.' Evacuations. Griff's Agenda 21 facts.
Deborah Dupré - Human Rights Examiner
Agenda 21's written goals are the same as the outcome of their actions in the Gulf of Mexico." A.C. Griffith
Deadly Denial of Core Exit
Denial that Americans are under a planned chemical warfare attack by their own own government gassing Gulf coast residents is resulting in a deadly slow-kill, rendering it impossible for most locals to self-relocate. Project Gulf Impact filmmaker has learned from government officials that "forced evacuation will begin within days" as Agenda 21 escalates, impacting not only Gulf Coast residents but also, in a domino effect, the entire nation equally in denial due to the unprecedented petrochemical-military-industrial-complex (PMIC) cover-up of the continuing U.S. crime against humanity for its ultimate "Full Spectrum Dominance."

High Seas Delay BP's Work at Gulf of Mexico Well
By Jim Polson and Mark Chediak
Aug. 30 (Bloomberg) -- BP Plc's effort to permanently plug the Gulf of Mexico well that caused the largest U.S. offshore oil spill in history probably will be delayed two or three days by rough seas, National Incident Commander Thad Allen said.
Waves up to 8 feet (2.4 meters) make it unsafe to remove and replace heavy valve assemblies a mile below the water's surface, Allen said in a conference call today while aboard a ship at the well site. Storms may persist another three days at the Macondo well, he said.

The Gulf Blue Plague is Evolving - Part II:
Corexit + Bacteria = Mutated Viruses
by Michael Edward - TheWorldVisionPortal.org
Without a doubt, the Gulf Blue Plague is evolving biologically as you will see factually set before you here. In all probability, this is the primary reason the mainstream media (MSM) has been silenced, especially with regards to local media outlets along the Gulf Coast.
The Gulf of Mexico is a biological time bomb that is undoubtedly evolving into a chemically induced breeding ground for mutating viruses. All the aspects exist in the Gulf right now and have been established for over three months. Their ongoing manipulated evolution into a viral plague or viral epidemic is evident, yet has been ignored.
THE CATALYIST: COREXIT DISPERSANT CHEMICALS

Obama Widens North Korea Sanctions on Nuclear Funding
By Flavia Krause-Jackson
Aug. 30 (Bloomberg) -- President Barack Obama widened U.S. financial sanctions on North Korea today in an effort to cut off sources of income that fund the nuclear weapons program of the regime's leader, Kim Jong Il.
The U.S. will freeze the assets of four North Koreans, three of the country's companies and five government agencies suspected of "illicit and deceptive activities" that support the regime's weapons industry, according to an executive order posted on the Treasury Department's website.
Those blacklisted bought luxury goods on behalf of the regime and are suspected of drug trafficking, money laundering and currency counterfeiting, the U.S. said.

Obama goes out on a limb for Middle East peace talks
By Christi Parsons and Paul Richter, Los Angeles Times
The president personally coaxed the Israeli and Palestinian leaders to agree to talks, even as some advisors questioned the wisdom of him linking so visibly to an intractable conflict.
After 18 months of faltering efforts to launch Middle East peace negotiations, President Obama is dramatically increasing his personal stake and his own political risk by hosting direct talks this week.
Obama personally helped coax Israeli Prime Minister Benjamin Netanyahu and Palestinian Authority President Mahmoud Abbas to come to Washington to meet with him Wednesday and resume talks the next day.

Obama's Department of Justice Puts Out Master Patriot Hit-list
Alex Jones Tv 1/5

Obama's Department of Justice Puts Out Master Patriot Hit-list
Alex Jones Tv 2/5

Obama's Department of Justice Puts Out Master Patriot Hit-list
Alex Jones Tv 3/5

Obama's Department of Justice Puts Out Master Patriot Hit-list
Alex Jones Tv 4/5

Obama's Department of Justice Puts Out Master Patriot Hit-list
Alex Jones Tv 5/5

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Monday 08.30.2010

Banks back switch to renminbi for trade
By Robert Cookson in Hong Kong - FT.com
A number of the world's biggest banks have launched international roadshows promoting the use of the renminbi to corporate customers instead of the dollar for trade deals with China.
HSBC, which recently moved its chief executive from London to Hong Kong, and Standard Chartered, are offering discounted transaction fees and other financial incentives to companies that choose to settle trade in the Chinese currency.
"We're now capable of doing renminbi settlement in many parts of the world," said Chris Lewis, HSBC's head of trade for greater China. "All the other major international banks are frantically trying to do the same thing."

In Toledo, the 'Glass City,' New Label: Made in China
By JAMES T. AREDDY - WSJ.com (free)
The Toledo Museum of Art's $30 million Glass Pavilion is a symbol of America's "Glass City," and reflects the legacy of its local glassmakers.
A smudge on the image: The pavilion glass was imported from China, the new global powerhouse of the glass industry.
No one in the U.S. had the capability to satisfy cutting-edge architectural specifications for the curving pavilion, even though the 2006 job involved techniques advanced decades ago by Toledo inventors: bending and laminating glass. The pavilion features 360 thick glass panels, each up to 13.5 feet tall, eight feet wide and weighing over 1,300 pounds.

Three Flashpoints to $220 Oil
By Byron King - dailyreckoning.com
08/27/10 Pittsburgh, Pennsylvania - With oil sitting comfortably at $73 a barrel this morning, we cast a nervous eye toward the Middle EastÉwhere three little-noted developments are setting the stage for a return to triple-digit prices. Maybe very soon.
1) On the surface, this looks like a pretty routine Iraq story: An ambush there yesterday killed six members of a Sunni militia known as the "Awakening Councils."
But the background the media didn't supply makes this much more interesting - and ominous. See, the Awakening Councils are Sunni Muslims the US government paid off in 2007 so they'd stop shooting at US troops.

The Fed Is Still Clueless About Bubbles and So Is the WSJ
cepr.net - Center for Economic and Policy Research
The economists and central bankers attending the annual meeting of central bankers in Jackson Hole, Wyoming apparently have not noticed the collapse of the housing bubble and the wreckage it has caused. This is the only plausible explanation for a WSJ article that told readers about a paper on a new approach to fiscal policy that argues:
"fiscal policy could benefit from the more scientific approach taken by monetary policy over the past two decades."
The article continues:
"The former U.S. Federal Reserve economist [the person presenting the paper] noted how monetary policy has improved after central banks started to adopt goals such as inflation targeting and as central bankers started to articulate the 'science' in public speeches."

Full Text of Ben Bernanke's Fed speech
DAYTON BUSINESS JOURNAL
The following is the full text of Federal Reserve Chairman Ben Bernanke's speech at the annual Fed symposium in Wyoming:
The Economic Outlook and Monetary Policy
The annual meeting at Jackson Hole always provides a valuable opportunity to reflect on the economic and financial developments of the preceding year, and recently we have had a great deal on which to reflect. A year ago, in my remarks to this conference, I reviewed the response of the global policy community to the financial crisis.1 On the whole, when the eruption of the Panic of 2008 threatened the very foundations of the global economy, the world rose to the challenge, with a remarkable degree of international cooperation, despite very difficult conditions and compressed time frames. And when last we gathered here, there were strong indications that the sharp contraction of the global economy of late 2008 and early 2009 had ended. Most economies were growing again, and international trade was once again expanding.

Policy Solutions, Part Three of Four
By Bill Baker - dailyreckoning.com
08/29/10 Baltimore, Maryland - The printing of money used to replenish the financial system may cause inflation - whether or not this series of radical measures is adopted. It will monetize public and private debt, and the key to not letting the surge in inflation become embedded permanently will be the taking of a credible stance to redraw our system with reduced liability going forward. While we are printing money, our government should quietly (if possible) buy gold with which it would promise to redeem dollars beginning at some point when our economic recovery is certain. No doubt this would be at a price that might shock the world today: perhaps $5,000, $10,000, or higher. Let the market bracket the possibilities; perhaps gold ETFs or digital gold accounts such as those at goldmoney.com would be our new private currency, and we could get out of the money-printing business once and for all.

America's Top Military Chief: Debt is Main Threat to U.S. National Security ... Pentagon Must Cut Spending
Washington's Blog
In February 2009, the head of U.S. intelligence - Dennis Blair - said that the global financial crisis was the largest threat to America's national security. All of America's intelligence agencies apparently agreed.
The same month, the chairman of the Joint Chiefs of Staff - Admiral Mullen - also agreed.
Now, Mullen is focusing on a specific economic threat. Specifically, Mullen is focusing on the debt:
The national debt is the single biggest threat to national security, according to Adm. Mike Mullen, chairman of the Joint Chiefs of Staff. Tax payers will be paying around $600 billion in interest on the national debt by 2012, the chairman told students and local leaders in Detroit.

Debt, Depression, Default. America is in Deep Trouble
By Eileen F. Toplansky - AmericanThinker.com
Consumers are spending less. Small retailers are closing shop -- even cable television subscriptions are seeing a loss in revenue. Mike Shedlock of globaleconomicanalysis.blogspot.com cites reports by Jacqui Cheng of Ars Technica, Mercedes Cardon of Finance Daily, and Jon Chavez of the Toledo Blade, highlighting America's economic woes with the following:

Everything is OK [satire / spoof]

Fed ready to take 'unconventional measures'
By Hibah Yousuf,
NEW YORK (CNNMoney.com) -- Federal Reserve chairman Ben Bernanke bluntly acknowledged that the U.S. economic recovery has lost considerable steam, but said the central bank has the necessary policy tools to support continued growth.
"The issue at this stage is not whether we have the tools to help support economic activity and guard against inflation," Bernanke said at the Fed annual symposium in Jackson Hole, Wyo. "We do."
Making his first public comments since the central bank announced it would buy additional long-term Treasurys to boost the recovery, Bernanke said that the pace of economic growth is "somewhat less vigorous" than expected, but remained optimistic for a pickup in 2011.

The All But Forgotten Self-Governing Economy
By Joel Bowman - dailyreckoning.com
08/28/10 Alexander City, Alabama -
GDP growth revised downward to an "anemic" 1.6%É
Jobless claims rise more than forecast ...
Home sales fall off a cliffÉworse than economists expectedÉ
Faced with a slew of deteriorating economic data points, Fed Chairman Ben Bernanke delivered a speech on Friday designed to assure investors that he has the fate of the nation's economy under control.
The Fed, said he, "is prepared to provide additional monetary accommodation through unconventional measures if it proves necessary, especially if the outlook were to deteriorate significantly."
Come again, Mr. Bernanke? "Deteriorate significantly"? What happened to the recovery? What happened to the "substantial progress" you had so earnestly forecast at last year's annual Federal Reserve retreat?

Fed stands by to boost US growth
By Alan Rappeport in New York - FT.com
Ben Bernanke, Federal Reserve chairman, said on Friday that weaker-than-expected consumer spending growth and a "depressed" housing market had slowed the pace of the US recovery and promised that the central bank was ready to take "unconventional" steps to stimulate the economy if needed.
In a speech at a gathering of central bankers in Jackson Hole, Wyoming, Mr Bernanke acknowledged that the pace of economic growth had been "less vigorous" than the Fed was expecting and that the pace of the labour market's recovery had been "painfully" slow.

Government at the heart of the crisis
The Economist.com
I'M FINDING the exchange on the financial crisis illuminating in a number of ways, but especially as it lays bare the ideological assumptions and motivations we each bring to these questions. In his latest assay, my esteemed colleague seeks to absolve government from any significant responsibility for the meltdown. (We seem to have moved beyond the question of inequality, which is fine by me.) Having concluded that "the CRA was largely irrelevant" and that "Fanny and Freddie were also-rans", he finds it "hard to understand how one could put government at the heart of the crisis." Let me try to help.

A Chat With Steve Forbes
Written by Mad Hedge Fund Trader - OilPrice.com
I sat down with Forbes magazine publisher and perennial Republican presidential candidate, Steve Forbes, whose father, Malcolm, I knew from my journalism days in the seventies. He was there formally to promote his new book, Power Ambition Glory, but I couldn't help but sense his loftier goals.
He says that the crash was a failure of government. It was caused by the Fed, which pursued a weak dollar policy, kept interest rates too low for too long, and printed too much money. Our central bank should pursue a strong dollar policy which will bring a revival of the credit markets. We have the most hard left president and congress in history, and they are on the cusp of getting what they want. Lifting the rules on upticks and naked shorting threw gasoline on the fire

Citigroup Is Cooking the Books
By Charlie Gasparino - FOXBusiness
An all-out war has broken out between Citigroup CEO Vikram Pandit and a prominent securities analyst who is saying that the big bank may be cooking the books by inflating its earnings through an accounting gimmick, FOX Business Network has learned.
The analyst, Mike Mayo, of the securities firm CLSA, has been telling investors that Citigroup (C: 3.72 ,+0.06 ,+1.78%) should take a writedown, or a loss on some $50 billion of "deferred-tax assets," or DTAs. That is a tax credit the firm has on its financial statement that Mayo says is inflating profits at the big bank by as much as $10 billion.

John Williams on the Revised GDP Number
JESSE'S CAFÉ AMÉRICAIN
John Williams' comments on the GDP number were short and to the point. I am still not on board with his hyperinflation forecast preferring to stick with a pernicious stagflation, although what he sees is certainly possible, as is a Japan style deflation. That is what 'fiat' is all about.
The correlation in stocks across the various indices today is remarkably uniform. Do you need to buy a vowel?
John Williams of ShadowStats
Economic Data Will Get Much Worse.
The kindest thing I can say about a stock market that rallies on the "stronger than expected" news that annualized growth in second-quarter GDP was revised from 2.4% to just 1.6%, instead of to the expected 1.4% (keep in mind those numbers are quarterly growth rates raised to the fourth power), or that gyrates over meaningless swings in seasonally-distorted weekly new unemployment claims, is that it is irrational, unstable and terribly dangerous.

Gerald Celente on Mitch Henck 26 Aug 2010
on the bailout bubble, unemployment, and equity crisis of 2010

Economist Shiller Sees Potential for 'Double Dip' Recession
By SIMON CONSTABLE - WSJ.com (free)
With the U.S. economic recovery losing steam, the chances of a second phase of a slowdown are increasing, according to a leading economist.
Speaking in The Wall Street Journal's The Big Interview show, Robert Shiller, professor of economics at Yale University, said he thought the second dip down of a so-called double-dip recession "may be imminent."
Earlier this month, he told the Wall Street Journal he thought the chance of a double-dip recession, which he noted is a rare event, was greater than 50%.

How does double dip recession affect Gold?
By Julian D.W. Phillips - CommodityOnline.com
What is the likelihood of a Double-Dip Recession?
Nearly all the commentary we have heard on this question says the same. "Yes, the prospects of a Double-Dip recession have increased but it remains unlikely that it will happen". We feel that there may be just a hint of self-interest in these answers. The shockwaves that will reverberate should some say it is going to happen, or if the news confirmed that it had started would rattle the markets hugely. Despite the ability to disseminate news instantly, we have to wait a month before reliable figures are published to confirm one way or the other that this is or is not the case.

Why gold price is rising
By Dan Norcini - CommodityOnline.com
The equity bulls were salivating over the prospect of watching another episode of "let's take the shorts out and slaughter them all" as the world eagerly awaited the giving of the law from Mt. Jackson Hole. With claps of thunder in the background and with flashes of lightning interrupting his keen observations upon the state of the US economy, (some swear that they saw the angelic host), the prophet of Monetary religion sounded forth his prognostications and then looked upon his handiwork. He then saw that his work was good and sat down and rested on the seventh day.

Gold may hit new high in coming weeks
by B G Shirsa - Business-Standard.com
Gold is likely to hit a new high with gold futures for December delivery expected to breach the June 21 high of $1,266.50 an ounce in the next two to three weeks. The October futures traded on the Multi-Commodity Exchange (MCX) is expected to cross Rs 19,200 in the coming weeks. The Federal Reserve chairman's assessment of the US economy on Friday confirms the view of most gold traders that the metal is likely to continue working its way higher in the weeks ahead

Why hasn't gold hit $2,000/oz? Doug Silver blames U.S. dollar
If gold really is supposed to shine during tough economic times, former International Royalty Corp. founder Doug Silver wonders why gold prices haven't soared much higher by now.
Author: Dorothy Kosich - MineWeb.com
If gold does best during times of uncertainty and fear, Balfour Holdings Chief and private investor Doug Silver said it should be doing much better.
In his annual talk to the Geological Society of Nevada, Silver, the founder of International Royalty Corp. (IRC) and founder of Denver-based mining analysts Balfour Holdings, said, "If we ever wanted a time for gold prices to take off, we are there." Silver sold IRC to Royal Gold earlier this year in a Cdn$749 million cash-and-shares deal.
Silver told his audience of exploration geologists that he is "quite surprised that gold hasn't gone to $2,000/oz."

Silver To Make A Major Move On Breakout
Jeb Handwerger - SilverBearCafe.com
Silver had very powerful break out Wednesday as investors are seeking assets that are safe and will retain value during a debt crisis. Silver is seeing demand at these price levels as it is historically cheap relative to gold. If the ratio came down to the levels it was in 2006 it would be close to $27 an ounce. Silver is soaring because investors are realizing this is a hard asset, it is money and it is historically cheap compared to gold.

The Billionaire Right-Winger
By Joe Conason - Truthdig.com
Despite the kaleidoscopic proliferation of political media over the past decade, most of what Americans hear and read about the workings of our democracy can be politely termed superficial. Only very rarely does journalism fully penetrate the glittering illusions created by partisans on every side to reveal the grittier realities. When a reporter does blast through the usual scrim of deception, that is worth noting-as in the case of Jane Mayer's investigation in the current issue of The New Yorker of the Koch family and its malign influence.
For decades, the Koch brothers, billionaire heirs of one of the largest privately held companies in the United States, have covertly sought to promote their hard-right ideology through third parties, think tanks, foundations and front groups. Their late father, Fred, having earned a fortune assisting the nascent Soviet oil industry, eventually became a right-wing extremist and member of the John Birch Society. His sons, especially David Koch, have not only expanded the family business but infiltrated their father's political views into the mainstream.

They Go or Obama Goes
By Robert Scheer - Truthdig.com
Barack Obama and the Democrats he led to a stunning victory two years ago are going down hard in the face of an economic crisis that he did nothing to create but which he has failed to solve. That is somewhat unfair because the basic blame belongs to his predecessors, Bill Clinton and George W. Bush, who let the bulls of Wall Street run wild in the streets where ordinary folks lived. And there was universal Republican support in Congress for the radical deregulation of the financial industry that produced this debacle.

Ninety Seven Percent of All Americans are Brain Dead
Economic Rant - SilverBearCafe.com
If you still think we have a two party system in this country please look at the chart below.
Carter (not on chart) far outspent all previous presidents and put us into hyperinflation. Pseudoconservative Reagan outspent all previous presidents. Bush Sr. outspent him. Clinton went nuts. Bush Jr. continued the insanity. Obama is now King of the Spenders. The National Debt will be paid in the form of the Much Greater Depression. Each man, woman and child in America owes $200,000. Every family of four (including infants) owes $800,000. It's hopeless folks. All debts get paid in the end, either by the buyer or the seller. Always.
TriOptima just reported there are $450 trillion in derivatives worldwide. Derivatives are basically a complex scam based on smoke and mirrors.

The Death of the First Amendment and
The Nazification of the United States
Paul Craig Roberts - SilverBearCafe.com
Chuck Norris is no pinko-liberal-commie, and Human Events is a very conservative publication. The two have come together to produce an important article, "Obama's US Assassination Program."
It seems only yesterday that Americans, or those interested in their civil liberties, were shocked that the Bush regime so flagrantly violated the FlSA law against spying on American citizens without a warrant. A federal judge serving on the FISA court even resigned in protest to the illegality of the spying.

On the Edge with Joern Berninger (1/2)

On the Edge with Joern Berninger - 27 August 2010 (2/2)

China's banking system shows disturbing, U.S.-style cracks
By Kathy Chu, USA TODAY
HONG KONG - Off-balance-sheet liabilities. Bad mortgage loans. Uncertain growth prospects.
These issues, which nearly toppled the U.S. banking industry and triggered the financial meltdown, are increasingly threatening the stability of Chinese banks.
Last week, a slew of Chinese banks - including Industrial & Commercial Bank of China, Bank of China and Agricultural Bank of China - reported strong profits. ICBC, the country's largest, earned $12.4 billion in the first six months of the year, above analysts' expectations. But rather than providing reassurance about banks' health, the positive numbers are fanning fears of what's yet to come.

Blockbuster bankruptcy is imminent
THE BUSINESS JOURNAL OF MILWAUKEE - BY Dallas Business Journal
Blockbuster has plans to file for a pre-packaged bankruptcy in September, the Los Angeles Times is reporting.
The paper is quoting unidentified sources who claim executive management is going the route of a pre-packaged bankruptcy filing, which will allow the company to reorganize in court and shed its debt burden.
Michael Pachter, an analyst with Wedbush Securities, said there's no reason not to believe the news report. He added that Blockbuster has no way of reorganizing out of court given its current debt load. "They have senior secured debt and unsecured debt," he said. "If you do anything out of bankruptcy to change the terms of the debt on one, it triggers a default on the other."

US stocks gain on stimulus hopes
By Hannah Kuchler in New York - FT.com
US shares regained ground on Friday and remained higher as investors digested Ben Bernanke's speech to central bankers in Jackson Hole, Wyoming. The Fed chief's pledge to take action, if necessary, to safeguard the economic recovery was viewed positively.
Stocks had originally rose as investors were cheered by a revised GDP figure which, though lower than the original number, was not quite as bad as they feared, before falling after news of a reduced forecast from Intel.

Small businesses hold off spending while waiting for aid
By Laura Petrecca, USA TODAY
Small businesses have put hiring, supply buying and real estate expansion on hold as they wait out the vote on a small-business-aid bill that stalled in the Senate earlier this summer.
The much-debated legislation offers tax breaks and waived loan fees. But it also comes with more divisive components, such as a $30 billion fund that would help community banks give loans to small businesses. Opponents say the fund would be a mini version of the often-criticized TARP large-bank bailout program.

Business Pulse: A third are thinking of quitting their jobs
DENVER BUSINESS JOURNAL - BY Mark Harden
A third of denverbusinessjournal.com readers who answered our latest Business Pulse question say they're thinking of quitting their jobs over the next year.
The results of our non-scientific survey echo national polling indicating that many workers who stuck out jobs they don't like through the recession -- along with pay cuts and boosted work hours -- are now beginning to think of finding something better.
A Rasmussen survey released Aug. 11 said 27 percent of U.S. adult workers are looking for a job outside their current company, the highest percentage in over a year.

US consumers split into two camps
By Greg Farrell and James Politi - FT.com
Consumer spending in the US has turned into a tale of two cities in 2010, with an entire segment of consumers splurging confidently on the finer things in life, while another segment, concerned about unemployment and with little or no discretionary income, spends only on bare necessities.
This bifurcation of the US consumer has become apparent across the spectrum, from restaurants and grocery stores to products such as coffee and beer.

Charlotte-area unemployment DIPS to 11.2%
CHARLOTTE BUSINESS JOURNAL
Unemployment in the Charlotte metro area dropped to 11.2 percent in July from an adjusted 11.4 percent rate in June, according to the N.C. Employment Security Commission.
The ESC says 95,788 residents were unemployed in July in the Charlotte-Gastonia-Concord area.
The Hickory-Lenoir-Morganton metro area had an unemployment rate of 12.7 percent, down from 13.1 percent in June. The ESC says 21,091 residents in that area were unemployed in July.
Mecklenburg County's jobless rate rose to 10.4 percent from 10.3 percent in June.

Commercial real estate failures are easier to spot
than residential woes
By SHERYL JEAN / The Dallas Morning News
Ann Strain walks Junebug, a Boston terrier, past a ghost town - hundreds of abandoned apartments with broken windows and weeds.
Neighbors think squatters have lived at times at the Signature Pointe apartments on Lovers Lane, just east of North Central Expressway. The Dallas police SWAT team trains there.
The apartments were emptied of tenants at least 2 ? years ago to make way for new rental units and retail, but that never happened. Now a bank owns the 13 acres.

Foreclosures of million-dollar-plus homes on the rise
By Lauren Beale, Los Angeles Times
The number of homes in the $1-million-and-up slice of the market that have become bank owned has tripled during the last three years in Los Angeles County, and the trend has shown little sign of slowing.
Foreclosure is blind.
After the mortgage meltdown and the plunge in home prices, record numbers of ordinary houses tumbled into foreclosure across Southern California as borrowers became unable or unwilling to pay their mortgages. But the rich aren't so different after all: Million-dollar-plus homes have reverted to lender ownership in increasing numbers - previous sales prices, prime locations and even celebrity pedigrees have provided no immunity.

Time to let home prices fall?
By Tom Petruno - Market Beat - LATimes.com
Many expect another wave of foreclosures to further deflate prices. The government could offer new incentives - or let market forces rule.
You can't force someone to buy a house.
But as a society we've long tried to make homeownership an offer you couldn't refuse.
And since the real estate mega-bubble burst three years ago, the government has tried even more tricks to get people to sign home purchase contracts.
Now, a grim reality has set in: Despite the still-rich basket of tax breaks for residential property owners, and the lowest mortgage rates in a generation, the pool of willing or able buyers is dwindling.

Housing's new nightmare
By Tami Luhby - CNNMoney.com
NEW YORK (CNNMoney.com) -- In another ominous sign for the economy, the number of people falling behind on their mortgages for the first time is on the rise.
This grim statistic is only the latest bad news for the reeling economy. Home sales are in free fall, initial jobless claims remain high and the gross domestic product slowed to a near halt in the second quarter, government reports issued this week showed.
The increase in short-term delinquencies is leaving some experts wondering whether a new round of foreclosures is on the horizon, even as the current wave begins to ebb.

Mortgage-loan modification marathon starts today in West Palm Beach
Event is being held at Palm Beach County Convention Center
in West Palm Beach
By HARRIET JOHNSON BRACKEY
Sun-Sentinel Staff Writer
Today at 9 a.m., is the official opening for the Neighborhood Assistance Corp. of America major mortgage modification event in West Palm Beach.
When NACA was last in West Palm Beach, in February, its counselors worked on 24,000 loans and modified 16,097 of them.
The association held an event in Miami Beach in April, helping about 15,000 people get loan modifications.
People will be lined up overnight, waiting for the Save The Dream Tour to open. Things will probably start getting busy Thursday. At 1 p.m. West Palm Beach Mayor Lois Frankel plans to hold a news conference with NACA Chief Executive Officer Bruce Marks to announce the event.

from April 2010 - a partial solution we haven't heard much about

The Right to Rent Plan
BY DEAN BAKER - CEPR
Millions of families face the loss of their homes over the next few years. While there is a long list of complicated and sometimes convoluted proposals to address the country's foreclosure crisis, there is a simple solution: Congress and the Obama Administration can give families facing foreclosure the right to rent their homes at the market rate for a substantial period of time.
This Right to Rent plan1 would prevent families from being thrown out of their homes as well as help reduce the neighborhood blight that is devastating communities with high levels of foreclosures.

This legislation is still in committee
H.R.5028
Title: Right to Rent Act of 2010
Sponsor: Rep Grijalva, Raul M. [AZ-7] (introduced 4/15/2010) Cosponsors (12)
Latest Major Action: 4/15/2010 Referred to House committee. Status: Referred to the House Committee on Financial Services.

Could the Right to Rent Stop the Foreclosure Hurricane?
Greg Kaufmann - TheNation.com
When the foreclosure hurricane first hit, subprime borrowers absorbed the brunt of it. Homeowners who had been fooled with teaser rates suddenly faced balloon payments they couldn't afford. Others couldn't refinance because of prepayment penalties they hadn't been aware of. And some people had made bad decisions and were now paying for it with their homes.
The crisis has now morphed - it's hitting everyone with an equal-opportunity kind of vengeance - the prime, subprime, underwater and unemployed. And that makes passing the Right to Rent Act introduced by Democratic Representatives Raœl Grijalva and Marcy Kaptur, and cosponsored by House Judiciary Committee Chairman John Conyers among others, all the more critical. It would give homeowners who would otherwise by kicked out of their homes the right to rent for five years.

Social Security: The Futile Fight For What's Been Promised
Bill Bonner - SilverBearCafe.com
No discussion of the upcoming collapse of the bond market would be complete without a mention of Social Security.
At least, after they've lost their money in stocks, real estate and bonds, Americans will at least have Social Security to live on, right? Wrong!
You know all that money you pay in Social Security taxes? Where do you think it goes? Into current expenses and US bonds!
That's right, the feds just use the money to finance whatever fool scheme they've got going at the moment...and give the Social Security Administration a bond in return. In theory, the SSA has assets. In practice, all they've got is the hope that the feds can squeeze enough money out of taxpayers to meet their obligations.

Obamacare Might Kill Off College Students' Health Plans
There's an easy fix: Repeal Obamacare, and replace it with real reform.
BY JEFFREY H. ANDERSON - The WeeklyStandard.com
According to President Obama, "If you like your health-care plan, you can keep your health-care plan. Period. No one will take it away. No matter what." You can keep your plan, that is, if your employer doesn't decide to dump it in the wake of Obamacare's passage (as many major employers are already considering doing), if you aren't one of the estimated 51 percent of American workers (66 percent of workers in small businesses) - according to the administration's own figures - whose plans would have to be changed or dropped under Obamacare, and if you don't have a Medicare Advantage plan or a consumer-driven (high-deductible, low-premium) plan. Now it appears that another type of plan might well be on the chopping block: college students' health plans.

TOTAL TYRANNY is staring us in the face
News Stories from The Strange Stack - Alex Jones Tv
Listen to part about RFID chips (WalMart) and recycling in Celeveland, Ohio, eavesdropping by Google in your homes, And people loosing their homes for less than $100. fines.

The Government Can Use GPS to Track Your Moves
By Adam Cohen - Time.com
Government agents can sneak onto your property in the middle of the night, put a GPS device on the bottom of your car and keep track of everywhere you go. This doesn't violate your Fourth Amendment rights, because you do not have any reasonable expectation of privacy in your own driveway - and no reasonable expectation that the government isn't tracking your movements.
That is the bizarre - and scary - rule that now applies in California and eight other Western states. The U.S. Court of Appeals for the Ninth Circuit, which covers this vast jurisdiction, recently decided the government can monitor you in this way virtually anytime it wants - with no need for a search warrant.
It is a dangerous decision - one that, as the dissenting judges warned, could turn America into the sort of totalitarian state imagined by George Orwell. It is particularly offensive because the judges added insult to injury with some shocking class bias: the little personal privacy that still exists, the court suggested, should belong mainly to the rich.

Environmental Protection Agency Reviewing Petition to Ban Lead Bullets
Will the EPA infuriate gun owners--
and seal the fate of Democrats on Nov 2nd?
BY JOHN MCCORMACK - The WeeklyStandard.com
Will Environmental Protection Agency Administrator Lisa Jackson make a back door move to ban lead bullets the day before the November 2 elections?
Several environmentalist groups led by the Center for Biological Diversity (CBD) are petitioning the EPA to ban lead bullets and shot (as well as lead sinkers for fishing) under the Toxic Substances Control Act (TSCA). Although EPA is barred by statute from controlling ammunition, CBD is seeking to work farther back along the manufacturing chain and have EPA ban the use of lead in bullets and shot because non-lead alternatives are available. But here's the catch: the alternatives to lead bullets are more expensive. A ban on the sale of lead ammunition would force hunters and sport shooters to buy non-lead ammunition that is often double the cost of traditional lead ammunition. A box of deer hunting bullets in a popular caliber could be upwards of $55.

Glenn Beck Cult Holds Creepy Revival at Lincoln Memorial in DC
Andrew Steele - infowars.com
People gathered Saturday in DC at the Lincoln Memorial as part of an event that Glenn Beck was hosting. The rally was a hybrid neocon pep rally/religious revival, consisting of pictures on a giant TV screen of famous moments from American history, along with inspirational music, waving flags, and talk of destiny and God from a loudmouth Fox News preacher who hides the insincerity in his eyes behind a thick layer of glasses while weeping in breathy sobs to mask his laughter.

Beck Says Rally Showed Discontent With U.S. Direction
By Lisa Lerer and John McCormick
Aug. 29 (Bloomberg) -- Fox News commentator Glenn Beck said the hundreds of thousands who attended his rally yesterday in Washington were expressing a deep dissatisfaction with the direction of the country under the Obama administration.
"People aren't happy about things," he said in an interview on the "Fox News Sunday" program. "A good number of people are not happy with the direction we're going."
The "Restoring Honor" rally was billed as a "nonpolitical" celebration of the military, patriotism and American heritage. Beck, 46, shied away from the partisan commentary that has made him famous during yesterday's rally, focusing instead on religious themes.

We Need A Revolution, Not A Movement
Chuck Baldwin - infowars.com
The elections of 2008 (and the early elections of 2010) produced two significant phenomena: the "Ron Paul Revolution," and the "Tea Party Movement." And, mark it down: both of them will have profound effects upon the upcoming November electionsÐand upon the 2012 elections as well. Call them what you want, however, America doesn't need another movement; it needs a genuine revolution.
The Tea Party movement, while still a force with which to be contended, has already been diluted and compromised. The primary elections plainly reveal the reality of this fact. The high spots so far are the defeats of Arlen Specter in Pennsylvania and Bob Bennett in Utah. The low spots so far are the reelection of John McCain in Arizona and the election of Dan Coats in Indiana.

Obama could kill fossil fuels overnight with a nuclear dash for thorium
By Ambrose Evans-Pritchard - Telegraph.co.uk
If Barack Obama were to marshal America's vast scientific and strategic resources behind a new Manhattan Project, he might reasonably hope to reinvent the global energy landscape and sketch an end to our dependence on fossil fuels within three to five years.
We could then stop arguing about wind mills, deepwater drilling, IPCC hockey sticks, or strategic reliance on the Kremlin. History will move on fast.
Muddling on with the status quo is not a grown-up policy. The International Energy Agency says the world must invest $26 trillion (£16.7 trillion) over the next 20 years to avert an energy shock. The scramble for scarce fuel is already leading to friction between China, India, and the West.

Corporate Media Dismisses Castro's Bin Laden Claim As Far-Fetched Conspiracy Theory
Paul Joseph Watson - PrisonPlanet.com
The corporate media wasted little time in seizing upon controversial Cuban leader Fidel Castro's comments about Osama bin Laden being a U.S. spy to deride the claim as a far-fetched conspiracy theory, and yet the fact that Bin Laden was once a CIA protŽgŽ and has been used time and again to the benefit of the U.S. governmentÕs geopolitical agenda is a documented fact.
It sounds like Fidel Castro has been reading Prison Planet.com, but the Guardian claims that the notorious revolutionary has "gone too far" in claiming Osama Bin Laden is a U.S. double agent.
The Cuban leader cites Wikileaks for his contention that Osama bin Laden is a CIA asset, but he went further in pointing out the fact that Bin Laden was routinely used by the Bush administration as a convenient boogeyman.

Cybersecurity Act of 2010 Passes Senate Committee
by Sharon Fisher - daniweb.com
S.3480 -- Protecting Cyberspace as a National Asset Act of 2010
This year's version of the Cybersecurity Act was approved by the Senate Committee on Homeland Security and Governmental Affairs after amending it to limit the president's authority in the event of a cyber emergency, reported The Hill.
The bill, sponsored by Sens. Joe Lieberman (I-Conn.), Susan Collins (R-Maine), and Tom Carper (D-Del.), is an update to a bill from last year that was also worked on by Senator Jay Rockefeller (D-West Virginia) and Senator Olympia Snowe (R-Maine). At that time, people were concerned about reports that it would give the President a "kill switch" to shut down the Internet, though the technical details of exactly how a single switch could shut down the Internet were not specified.
"Giving government, especially the president, unprecedented control over America's trunk line of information, over electronic free speech and over business activities simply invites suspicions about whether it would be used politically to frighten people at election time-as did the color-code alerts-and to trample on constitutional rights like the Patriot Act did," wrote the Idaho Mountain Express, noting that Lieberman said he had modeled that aspect of the bill on governmental rights in Communist China.

Mexican cop investigating murders of 72 migrants is dead
USAToday.com
The Mexican detective heading the investigation into the murders of 72 migrants has been found dead near the massacre site along with another officer, Britain's Guardian reports, citing local media.
Roberto Suarez has been missing since Wednesday. A local officer was with him. "I am almost certain my husband and the other man were kidnapped," his wife told the BBC.

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Friday 08.27.2010

Is It Just Me Or Is 2010 Feeling A Lot Like 2008?
Graham Summers - SilverBearCafe.com
Haven't we been here before?
One of the strangest aspects of history is that it not only repeats itself but that the repeats often come in rapid succession. Today, the entire financial world is repeating the 2008 debacle on a sovereign basis and few if any commentators seem to sense it.
Weird isn't it? The 2008 Autumn debacle happened less than two years ago. The policy response to it was to simply shift garbage debt from Wall Street to the Federal Reserve, suspend accounting standards, and pump the financial system with TRILLIONS of Dollars (NONE of which fundamentally addressed any of the problems causing the crisis) and yet grown adults with fancy titles and degrees actually believed that the issues were FIXED.

Fed in emergency bid to put bailout ruling on hold
(Reuters) - The Federal Reserve asked a U.S. appeals court to delay implementing a ruling that would force the central bank to disclose details of its emergency lending programs to banks during the financial crisis.
Wednesday's emergency request for a 90-day delay came after the U.S. Second Circuit Court of Appeals on August 20 denied a motion by the Fed to rehear the case, which had been brought by Bloomberg LP, the parent of Bloomberg News, and News Corp's Fox News Network.
A stay would give the Fed and the Clearing House Association, a group of major U.S. and European banks, until November 18 to appeal the ruling to the U.S. Supreme Court.
The Fed programs were designed to shore up the financial markets, and more than doubled the central bank's balance sheet to well over $2 trillion, especially after the September 2008 collapse of Lehman Brothers Holdings Inc.

Bernanke, Trichet Economic Paths May Diverge at Jackson Hole
By Simon Kennedy and Scott Lanman
Aug. 27 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke and European Central Bank President Jean-Claude Trichet, who united to fight the worst global recession in six decades, may be diverging over the outlook for their economies.
The Bernanke-led Fed, while saying U.S. growth would be slower than anticipated, announced on Aug. 10 it will buy Treasuries to set a $2.05 trillion floor on its balance sheet and keep interest rates from rising. Trichet said Aug. 5 that the euro-area economy was surpassing forecasts, which may pave the way for the ECB to look at phasing out its emergency lending measures.

In Jackson Hole, a laid-back retreat with some serious policymaking
By Neil Irwin - WashingtonPost.com
JACKSON, Wyo. -- I'm in Grand Teton National Park for the Federal Reserve Bank of Kansas City's annual economic symposium, one of the most important events for the world's makers of monetary policy.
The conference itself begins this evening, though participants started trickling in last night. It is an odd scene here in the lobby of the Jackson Lake Lodge, which is an awfully good place to be for economic groupies (if such people exist). Right now, Axel Weber and Allan Meltzer are in quiet conversation across the room. Nearby is a guy trying to get his kids organized to go hiking, almost certainly oblivious to the fact that he is standing next to the second-most powerful central banker in Europe and the leading historian of the Federal Reserve.

Fed Seeks Delay of Bank Data Release While Considering Appeal
By Bob Ivry and David Glovin
Aug. 26 (Bloomberg) -- The Federal Reserve Board sought to delay the court-ordered release of documents identifying banks that might have failed without the U.S. government bailout while it considers an appeal to the U.S. Supreme Court.
The Fed asked the U.S. Court of Appeals in New York yesterday to delay implementation of a ruling that compels the central bank to release the documents.
"The stay is necessary to permit the board to consult with the Department of Justice regarding an appeal to the Supreme Court," Fed spokesman David Skidmore said.
The appeals court on Aug. 20 denied the Fed's request to reconsider its decision requiring it to release records of the $2 trillion U.S. loan program.

Audit the Fed!!!
Posted by WARREN MOSLER - MoslerEconomics.com
The Fed should offer full transparency. These are the reasons the Fed gives for secrecy:
"The Fed argued that allowing disclosure could stigmatize banks, causing a loss of confidence that could lead to deposit runs, bank failures and damage to the economy."
The fact that the Fed fears a liquidity crisis is evidence that it doesn't understand banking.
With the FDIC offering deposit insurance for up to 100% of any bank's liabilities, it should be clear to the Fed the liability side of banking is not the place for market discipline. Liquidity should not be an issue and it should be provided in unlimited quantities at all times, much like most of the rest of the world's central banks have been doing for a long time.

Fresh flight to Swiss franc as Europe's bond strains return
By Ambrose Evans-Pritchard - Telegraph.co.uk
The Swiss franc has surged to an all-time high against the euro on capital flight from the eurozone after Irish, Greek, and Portuguese bonds came under renewed fire.
Yields on 10-year Swiss bonds fell to 1.02pc as investors flocked into the ultimate safe-haven asset, now outperforming gold.
No country in the developed world apart form Japan has ever seen 10-year yields drop below 1pc. Rates remained significantly higher during the two great depressions of the 1870s and the 1930s.
Within the eurozone investors turned to German Bunds, pushing yields to an historical low of 2.11pc. The search for safety seems driven by swirling mix of fears over a double-dip recession in the US, austerity overkill across the West, and sovereign debt worries on the eurozone periphery.

Fed's Bernanke Running Out of Options
WRITTEN BY BOB ADELMANN - The New American
When Fed Chairman Ben Bernanke speaks on Friday at the Fed's annual meeting in Jackson Hole, Wyoming, Fed-watchers from around the world will be hanging on his every word, phrase, and nuance for clues. They'll be listening to hear that the chairman knows what's happening in the economy, and that if things get worse, he has a plan.
The economy continues to suffer as shown by weak demand for housing, high unemployment, and declines in hard goods manufacturing. As Randall Forsythe put it, "Every data point on employment and housing since midyear has fallen short of expectations, in some cases, far short." The numbers just released by the National Association of Realtors for July were horrific, despite the Fed's efforts to "re-flate" the housing market, as Tom Eddlem pointed out.

Cancer & Desperation of QE2
By: Jim Willie CB, GoldSeek.com
History is being made. The American public has never been so nervous, perhaps fearful of something dreadful and imminent. The global monetary system is crumbling. The typical stimulus has failed to jumpstart the USEconomy. The 20 months of near 0% short-term official interest rate has failed to revive the moribund US housing market. The phony FASB accounting rules has failed to accomplish anything except a stay of execution for the big US banks, which do not lend much. In fact, the US banks are largely dead entities showing enough life for to receive USGovt largesse aid. Witness the failure of the US financial sector. Witness the climax chapter of failure for the Fascist Business Model. The US banker brain trust, which possesses only a modicum of economic wisdom, analytic prowess, or foresight, finds itself in a desperate corner. Their talk of an Exit Strategy in the last several months was summarily dismissed as nonsense, propaganda, and wishful thinking by the Jackass here on a consistent irrefutable basis. The US Federal Reserve is ready to embark on the second round of Quantitative Easing. The monetization of US$-based bonds of many types will be done on a second initiative, on cue. Here is the irony, the stupidity, the insanity, the recklessness, the tragedy. What failed, they will do again, maybe even bigger! At risk is global confidence and trust, hardly a zero cost item.

UK bank accounting rules 'fatally flawed',
warns influential watchdog
By Louise Armitstead - Telegraph.co.uk
The Government has been warned of a "regulatory fiasco" in which British banks have apparently adhered to flawed reporting standards for more than five years.
An influential watchdog has written to the Department of Business listing a catalogue of staggering regulatory errors that allegedly contributed to the collapse of several banks in 2008 - and still threatens the system today.
While reviewing the proposed expansion of the International Financial Reporting Standards for accounting, Tim Bush, a member of the "Urgent Issues Task Force" that scrutinises the work of the Accounting Standards Board (ASB), claims to have uncovered "fatal" and "dangerous" flaws in the system.

Economy Entering 5-Year Period of Stagnation?
U.S. News and World Report's Rick Newman argues the U.S. economy has entered a period of no growth.

Gold demand robust in 2010
CommodityOnline.com
Demand for gold will remain robust during 2010 as a result of accelerating demand from India and China, as well as increasing global investment demand driven by continuing uncertainty over public debt and economic recovery, the World Gold Council (WGC) said.
According to the WGC's Gold Demand Trends report for Q2 2010, published today, demand for gold for the rest of 2010 will be underpinned by the following market forces:

My Take on Gold
Richard Russell - SilverBearCafe.com
Dennis Gartman is an experienced commodity trader. Dennis has been very cautious about gold; he "sort of" likes gold, so he calls himself a "gold agnostic." For this reason it's most interesting to read what Dennis says about gold in today's report.
"Turning, then to gold and other metals, prices turned sharply for the better yesterday as the world rushed out of equities and looked for any safe harbors that were available. Certainly the rush to the Swiss franc was obvious, as noted above, and so too the rush into sovereign debt securities. But frankly, the rush was on to gold once again. We remain long what we have referred to as an 'insurance' position in gold, but we own it in terms of EUROs and /or of British pounds sterling, otherwise we remain an agnostic. To assuage our friends who are gold-bug-leaners, we shall not be short of gold. Nothing likely shall ever turn us manifestly bearish of it. But for the moment we are simply hard upon the sidelines, owning only this small 'insurance' position and comfortably in that position.

Precious metals decouple from Dow
NEW JERSEY (Commodity Online): Precious metals have now decoupled from the Dow Jones Industrial Index with Dow falling 6.1% from its high on August 9th, along with both gold and silver rising by about 3.3% during the same period.
A year ago we would consistently see precious metals and stock market prices rise and fall in parallel, according to National Inflation Association (NIA).
The Dow Jones to gold ratio is now down to 8.1, near its low for 2010 of 7.9. The gold to silver ratio still remains at a historically high level of 66. However, silver was up today by $0.65 to $19.03 per ounce, its biggest one day gain since early June. We expect silver to significantly outperform gold in the months to come.

Silver Prices Now Rising Faster Than Gold
By: Peter J. Cooper - SilverSeek.com
August is usually a quiet month in the precious metals market but this month is different. Silver has started behaving 100 per cent like a precious metal and not as an industrial commodity, and while stocks and Dr Copper have been falling, silver has been outperforming gold which is also on the up.
What is going on here? This is actually fully consistent with the bullion market rumors about the bank cartel unwinding its silver futures positions in the quietest month of the year.

The Ethics of Gold
By Ron Robins - alrroya.com
The rising price of gold stands as the ethical barometer of the mismanagement of our fiscal, monetary, and currency systems. Gold is in the early stages of re-asserting its historic role of helping to bring order to monetary and currency chaos. Its price has risen more than fourfold over the past ten years as a result of investors anticipating the predictable financial and currency chaos we have today-and what is likely yet to come.
The central banks and government treasuries, particularly those of the US, Europe, and Japan, have been weakened and our trust in them eroded. For decades they assured us that only they and their paper currencies and fractional reserve banking systems can keep our economies growing forever. They are now failing for all to see. And before the ships of state sink and economies further submerge they bail out their banking friends.

The Economy When Debt Is Everywhere
Bob Chapman - The International Forecaster
Greece forced into a harsh reality, madness, next is Spain, Portugal and Italy to be sold to IMF servitude for decades, twenty countries now headed into bankruptcy, no relief from unemployment, reduced US GDP, a million jobs to be lost... nightmares for the economy ahead.
Debt is everywhere and it certainly is onerous. We all have heard about the sovereign debt crisis, the debt of Greece and the debts of Ireland, Spain, Portugal and Italy. During that process the euro fell from $1.50 to $1.187; which gave euro zone exporters quite an advantage. The euro has since rebounded to a high of $1.33 and for now settled in near $1.28. Business confidence is back, but in the meantime the next course of action is to be higher taxes and austerity. Even consumers believe things are not going to improve. They all probably see the advantages of a cheaper euro. Even the CDS premiums have disappeared, which means at least for now the crisis has been arrested with a Band-Aid called loans - loans that will take these countries years to repay accompanied by years of depression. As a result, Greece is on the edge of revolt.

Bob Chapman on Radio Liberty 23 Aug 2010

Obama confers with economic team
by Mike Memoli - The Swamp - Chicago Tribune
President Obama was silent yesterday as the White House punched back at House Minority Leader John Boehner, who in a major speech called on the president to dismiss his economic team.
Today, the White House released a so-called "readout" of a call Obama held with that team, which seemed in part another response to Boehner's remarks and a vote of confidence for his advisers.

Dollar May Extend Decline to Below 70 Yen
By Yoshiaki Nohara and Hiroko Komiya
Aug. 27 (Bloomberg) -- The dollar may drop to less than 70 yen, surpassing a record low reached in 1995, Mizuho Corporate Bank Ltd. said, citing trading patterns.
A weekly ichimoku chart shows the U.S. currency has been in a downtrend since it reached this year's high of 94.99 yen in May, said Hiroyuki Tanaka, chief technical analyst in Tokyo at the unit of Japan's second-largest bank. A daily ichimoku chart signals any gains in the dollar will be limited as the currency stays below the so-called conversion line and baseline, he said.

Blackstone urges court to throw out IPO appeal
By Jonathan Stempel -
(Reuters) - Blackstone Group LP urged a federal appeals court not to revive an investor lawsuit accusing it of hiding bad investments before raising $4.7 billion in its 2007 initial public offering.
A lawyer for the private equity firm argued that U.S. securities laws did not require the private equity firm to disclose expansive details about hundreds of investments that it believed the investors sought.
But investor's attorney David Brower countered that U.S. District Judge Harold Baer was wrong to dismiss the lawsuit in September 2009.
"Blackstone has the obligation to report significantly negative, and even significantly positive, results," Brower, a partner at Brower Piven PC, told the U.S. Second Circuit Court of Appeals in New York.

Economic Armageddon:
Ladies and Gentlemen, the Double Dip is Here!
Pravda.ru [caveat lector]
The worst nightmare forecast by economic specialists over the previous years has come true: new research by economic gurus in the United States of America has revealed a bleak scenario: the United States' economy is in a state of depression. Yes, it is the Double Dip, a roller-coaster ride to economic catastrophe and it has arrived. To come: massive debt default, the failure of entire nations and widespread starvation in the western world.
The research referring to the works of a number of leading economists (David Rosenberg, Fred Harrison, Arthur Laffer, Nobel Prizewinner Paul Krugman, Robin Griffiths) is revealed in the article by US based analyst and writer, Terrence Aym*. And it makes terrifying reading.
While these leading economists represent different views from opposite ends of the political spectrums both in the USA and the UK, on one thing they agree: the decade ahead is going to get worse.

The Rise and Fall of the U.S.S.A.?
WRITTEN BY CHRISTIAN GOMEZ - The New American
In the latest issue of Trends Journal Gerald Celente, the founder and director of Trends Research Institute and also bestselling author of Trends 2000 and Trends Tracking, writes that the United States is walking down the same road of demise as the former Soviet Union.
Celente further elaborated on this point in a recent video "tech-ticker" interview, available online at Yahoo! Finance, saying, "In a lot of ways it's empire decline; they ran the Cold War race and they lost, we're still in the race..."

China Buys Euros as Fear of World Depression Grows
By Webster G. Tarpley
The US Treasury has just announced that China's official holdings of U.S. Treasury securities declined by about $30 billion between April and May of this year, from about $900 billion to some $868 billion. According to the US authorities, this means that Chinese holdings of US government paper are now at the lowest level in the past year. A 2% to 3% decline in a month does not qualify as massive dumping, but simply means that China is in the process of diversification. It is also very likely that China has more U.S. Treasury bonds than this official count would indicate, quite possibly through proxy purchases via Hong Kong and other places.
With the sales of existing homes in the United States falling by 27% this morning, together with disastrous statistics regarding unemployment and foreclosures, it ought to be obvious that the US economy is in depression. Even experts interviewed on CNBC are beginning to wake up to this obvious fact.

Goldman Looks to Move Proprietary Trading Desk

Foreclosures Fall, but Rise in Delinquency Causes Concern
By DAVID STREITFELD - NYTimes.com
The foreclosure crisis finally began to improve in the second quarter, but with the continued weakness in the economy and the recent deterioration of the housing market the gains may prove fleeting, data released Thursday indicated.
For the first time since 2006 the number of loans in the process of foreclosure fell, the Mortgage Bankers Association said.
But the group's chief economist, Jay Brinkmann, said any conclusion that the improvements would continue was premature. "It's more of a hope than anything at this point," he said.

28% of Ga. mortgages underwater
ATLANTA BUSINESS CHRONICLE
Some 28 percent of homeowners in Georgia were underwater in their mortgages in the second quarter.
CoreLogic reported Thursday 449,969 negative equity mortgages out of the Peach State's 1,601,921 total mortgages.
A borrower is in negative equity if he or she owes more on the mortgage than the home is worth.
CoreLogic also reported 11 million, or 23 percent, of all residential properties with mortgages in the United States were in negative equity at the end of the second quarter, down from 11.2 million and 24 percent from the first quarter of 2010. Foreclosures, rather than meaningful price appreciation, were the primary driver in the change in negative equity.

One in 10 mortgage holders faces foreclosure
by Alan Zibel - AP -MSNBC.MSN.com
Government aid efforts having little impact stemming housing crisis
WASHINGTON - One in 10 American households with a mortgage was at risk of foreclosure this summer as the government's efforts to help have had little impact stemming the housing crisis.
About 9.9 percent of homeowners had missed at least one mortgage payment as of June 30, the Mortgage Bankers Association said Thursday.
That number, which is adjusted for seasonal factors, was down slightly from a record-high of more than 10 percent as of April 30.

Real Estate: No New McMansions Sold in July
By DAN BURROWS - DailyFinance.com
Not only did new-home sales plunge in July to a record low going back to 1963, but the McMansion market saw no activity whatsoever -- for the second month in a row.
As David Rosenberg, the presciently bearish chief economist and strategist at Canadian asset manager Gluskin Sheff told clients Thursday: "The high-end market, in particular, is under tremendous pressure. In fact, it is becoming non-existent."
Not a single new home priced above $750,000 sold in July or June, Rosenberg notes. As for houses priced between $500,000 and $750,000, only 1,000 new units were sold last month. When it comes to new homes that did find buyers in July, more than 80% were priced under $300,000.

Procrastination on Foreclosures, Now 'Blatant,' May Backfire
By Jeff Horwitz and Kate Berry - AmericanBanker.com
Ever since the housing collapse began, market seers have warned of a coming wave of foreclosures that would make the already heightened activity look like a trickle.
The dam would break when moratoriums ended, teaser rates expired, modifications failed and banks finally trained the army of specialists needed to process the volume.
But the flood hasn't happened. The simple reason is that servicers are not initiating or processing foreclosures at the pace they could be.

Foreclosures fall but new delinquencies up: MBA
By Al Yoon
(Reuters) - The number of U.S. homes headed for foreclosure fell during the second quarter, marking the first such drop since the housing slump began in 2006, but the improvement may be fleeting as the number of newly delinquent homeowners rose, a banking group said on Wednesday.
The percentage of loans in the foreclosure process declined last quarter to 4.57 percent from 4.63 percent in the first quarter, partly because of lender efforts to ease payments for homeowners and the impact of temporary home purchase tax credits, the Mortgage Bankers Association said in a report.

New home sales fall to record low
By Alejandro Lazo, Los Angeles Times
July's annualized sales rate of 276,000 units was the lowest since the government began keeping track in 1963.
Sales of new homes unexpectedly sank 12.4% in July to the lowest point since government records starting being kept in 1963. It underscored continued weakness in the housing market, which tanked after the expiration this spring of a tax break for home buyers who were already facing a stagnant job market.
The Commerce Department said Wednesday that new single-family houses in July were sold at a seasonally adjusted annual rate of 276,000 units. It marked a 32.4% drop from the same month a year ago.

Keiser Report No:72

Credit Card Rates Push the Envelope
By: Rick Ackerman - GoldSeek.com
You've got to wonder what the banks have in mind now that they've raised credit card rates to an average 14.7 percent, up 160 basis points from a year ago. Are lenders perhaps trying to tell us that they are no longer interested in advancing cash to users of plastic? After all, what shopper or diner would borrow a dime with a credit card if it carried such an exorbitant interest charge? And even if there were borrowers at such usurious rates, how many of them could be counted on to service their loans indefinitely (which is how long it would take to pay off such loans)? It's not as though the banks can go after delinquent borrowers with such time-honored tools of the loan shark as baseball bats, brass-buckled belts and straight razors.

10 Big Retailers Closing Stores
By MERCEDES CARDONA - DailyFinance.com
Your next shopping trip may not be as convenient as it used to be. The second quarter earnings season brought news from several major retailers that they will be shutting down stores. Both Saks (SKS) and Abercrombie & Fitch (ANF) said they were closing stores in several parts of the country. Meanwhile, other stores like the struggling Blockbuster video rental chain, continue to slash stores by the dozens. American Apparel (APP), which is close to defaulting on its loans, just may be next.
Consumers just aren't shopping the way they used to. Even Wal-Mart Stores (WMT), which typically fares well during tough economic times, is worried. "The slow economic recovery will continue to affect our customers, and we expect they will remain cautious about spending," said president and CEO Mike Duke in a statement that was released during the company's second quarter earnings report.

Blockbuster tells Hollywood studios it's preparing for mid-September bankruptcy
LATimes.com
After dominating the home video rental business for more than a decade and struggling to survive in recent years against upstarts Netflix and Redbox, Blockbuster Inc. is preparing to file for bankruptcy next month, according to people who have been briefed on the matter.
Executives from Blockbuster and its senior debt holders last week held meetings with the six major movie studios to discuss their intention to enter a "pre-planned" bankruptcy in mid-September, said several people familiar with the situation who requested anonymity due to the sensitivity of ongoing talks.

America's Millionaires Are Feeling More Bearish
Tim Iacono - SeekingAlpha.com
U.S. investors with assets in seven or more figures are not feeling nearly as chipper about the domestic state of affairs as they were over the last year or so, that is, when stock prices were generally rising. Reuters reports on how their mood has soured.
The Spectrem millionaire investor confidence index fell to its lowest level in more than a year in August as wealthy U.S. investors worried about politics and unemployment, according to Spectrem Group.

Desperate Consumers Stop Paying Mortgages
in Order to Pay Credit Cards
By CHARLES WALLACE - DailyFinance.com
Normally, it would be considered a positive sign that people are reducing their credit card debt load. But a series of statistical releases this week confirms an ominous new trend among desperate consumers: They have stopped paying their mortgages but are continuing to pay off their credit cards so they can continue to buy staples, like food.
"People are trying to free up cash so they have it on a daily basis," says Theodore W. Connolly, a bankruptcy attorney in Boston who has just published a new book on the problem, The Road Out of Debt: Bankruptcies and Other Solutions to Your Financial Problems. "People are getting fearful again and are worrying about just paying for their groceries and doing the laundry."

The Hidden Income Tax Surcharge
By James Schaefer - WeElectedYou.org
Think you are in the 15% tax bracket, or the 25% tax bracket? Think again.
The tax rates for Social Security and Medicare total 15.3%, and have been at that level for the past twenty years. Most workers only see half that figure deducted from their paychecks, but if your employer didn't have to give 7.65% of your salary to the government he could give it to you.
The $2.5 trillion Social Security trust fund doesn't really have $2.5 trillion in it, because all the money is invested in Treasury Bonds. A Treasury bond is a loan to the government, and it goes without saying that our congressmen spent the borrowed money as soon as they got their hands on it. Future payments to Social Security beneficiaries will have to be paid from future taxes.

The Social Security Obligation
By James Schaefer - WeElectedYou.org
Dr. Krugman's comment about "people who . . . are itching to dismantle Social Security" is an interesting one. It would appear that government has already done this over the past forty years, using the Social Security trust fund to cover federal budget shortfalls. The well is now dry, and making Social Security solvent can only be done at additional future expense to taxpayers.
Taxpayers will now have to pay twice to fund Social Security, the first time out of their paychecks during their working years, and - starting this year - yet again, to pay back the IOUs to keep the system running.

The U.S. Labor Force Is Being Killed Off
Ever wonder what Obama really means by a "jobless recovery"? It means that the British are killing off the U.S. labor force with their Nazi policies of "creative destruction," and trying to convince you that it's good, and that we're in a "recovery."
How bad is real unemployment? Worse than the Great Depression of the 1930s, and rapidly deteriorating. Most people try to determine unemployment by accretion of categories: official unemployment + underemployed + part time workers + discouraged workers + this + that. But that misses the actual picture, which only emerges when you take the top-down approach developed by LaRouche's science of physical economy.

Obama jobs death toll watch: More health care layoffs
By Michelle Malkin
I said yesterday in my Beltway Chainsaw Massacre column that the GOP needs to track the Obama jobs death toll and tell the victims' stories far and wide.
But there's no need to wait for the GOP. I'll keep doing it right here.
The first story of the day comes from the Fort Worth Star Telegram in Texas, where a health insurer called Health Markets has laid off 70 workers and expects up to 180 more as it braces for the costs of Obamacare and other government mandates:
HealthMarkets, the North Richland Hills-based seller of health insurance, laid off 70 employees this month and expects to trim 180 more positions by the end of the first quarter of 2011, according to a recent federal filing.

Health Insurer Cash Shifts to Favor Republicans Before Election
By Drew Armstrong
Aug. 26 (Bloomberg) -- Health insurers led by WellPoint Inc. are backing Republicans with campaign donations by an 8-to - 1 margin, favoring the party that's promised to repeal President Barack Obama's health-care overhaul if it wins back Congress.
WellPoint, along with Coventry Health Care Inc. and Humana Inc., gave Republican candidates $315,000 from May through July, according to U.S. Federal Election Commission records. That compares with $41,000 given to Democrats by the three companies as the parties near November elections that will determine who controls the U.S. House and Senate next year.

Can GOP Repeal Parts of Health-Care Reform?
Galen Institute President Grace Marie Turner on what measures in the health-care law a Republican House might be able to overturn.

A Relativist, Wrapped in a Muslim, Inside an Agnostic
George Neumayr - The American Spectator
Why does a significant chunk of the American electorate think Obama is a Muslim? Let's count some of the reasons: he speaks of his "Muslim roots," says he hails from "generations of Muslims," was born to a line of Muslim males and given by them an Arabic name, went to a Muslim school in Islamic Indonesia, speaks glowingly of Islam whenever he gets the chance, holds a Ramadan dinner in the White House, tells his NASA head to turn the space agency into a Muslim outreach program, and last but not least insults doctrinal Christians routinely.
The voice of the people is the voice of God, the pander bears and demagogues of the left usually say. But not on this one. With great impatience they have appeared on cable shows this week to lecture the American people on Obama's "real" religion. Has the left-wing chattering class ever been more eager to pronounce a president Christian?

Rotten Eggs and Our Broken Democracy
By Amy Goodman - Truthdig.com
What do a half-billion eggs have to do with democracy? The massive recall of salmonella-infected eggs, the largest egg recall in U.S. history, opens a window on the power of large corporations over not only our health, but over our government.
While scores of brands have been recalled, they all can be traced back to just two egg farms. Our food supply is increasingly in the hands of larger and larger companies, which wield enormous power in our political process. As with the food industry, so, too, is it with oil and with banks: Giant corporations, some with budgets larger than most nations, are controlling our health, our environment, our economy and increasingly, our elections.

Sheriff Babeu:
It's 'An Outrage' Obama Stopped Building Border Fence
By Terence P. Jeffrey, Editor-in-Chief - CNSNews.com
(CNSNews.com) - Sheriff Paul Babeu of Pinal County, Ariz., says it is "an outrage" the Obama administration has stopped building the double-fencing needed to assist the Border Patrol in securing the U.S.-Mexico border and says it is time for the United States to begin fighting illegal immigration and drug smuggling directly at the border instead of within the country where it harms American citizens and communities.
By the time Obama was inaugurated in January 2009, according to the Justice Department, only 108 miles of the 262-mile-long Arizona portion of the 2,000-mile-long U.S.-Mexico border had been fenced.

Debt Burden for Squirrels
by Michael Smith - WeElectedYou.org
Just watched an ABC News feature on the rope bridges Arizona will construct to keep Mount Graham red squirrels from becoming roadkill. The bridges are expected to save five squirrels per year, at a cost of $1.25 million. The funding will be provided by-wait for it-the Federal Highway Administration!
Show of hands here-who would borrow money from China to do this?

Gulf Oil Spill: Rick Steiner Got BP Disaster Right From The Beginning, Warns Crisis Is Far From Over
Dan Froomkin - SilverBearCafe.com
I first spoke to Rick Steiner more than three months ago - about two weeks into the Deepwater Horizon disaster - after a source recommended I talk to him for a story I was writing about the spill as a teachable moment. Steiner is a marine conservationist and activist in Alaska who started studying oil spills when the Exxon Valdez ran aground in 1989, and never stopped.
What Steiner said to me during that first interview was blunt, depressing - and struck me as having the ring of truth. Little did I know how true.
"Government and industry will habitually understate the volume of the spill and the impact, and they will overstate the effectiveness of the cleanup and their response," he told me at the time. "There's no such thing as an effective response. There's never been an effective response - ever - where more than 10 or 20 percent of the oil is ever recovered from the water.

"We're seeing way more dispersant than ever before" Large, thick oil plumes, freshly sprayed with poison!
by Alex - The IntelHub.com
Today, Project Gulf Impact is out on the waters in and around Orange Beach Alabama. What they have found is exactly the opposite of what BP and the federal government have told the American people. Not only did they find oil but they apparently found what looks to be freshly sprayed dispersant, still in powder form.
Why is this toxic dispersant still being sprayed? Warnings from scientists and independent journalists have indicated that Corexit could effect the gulf for at least twenty years.

Gulf Chemist: Mercenaries Hired By BP Are Now Applying
Toxic Dispersant at Night and In an Uncontrolled Manner -
Which BP Says It No Longer Uses
Washington's Blog
Bob Naman is an analytical chemist with almost 30 years in the field, based in Mobile, Alabama. When WKRG News 5 gave Naman samples of water from the Gulf of Mexico, Naman found oil contamination, and one of his samples actually exploded during testing due - he believes - to the presence of methane gas or Corexit, the dispersant that BP has been using in the Gulf: [see video]
But the story only starts there.
A few days ago, Naman was sent a sample of water from Cotton Bayou, Alabama. Naman found 13.3 parts per million of the dispersant Corexit in the sample: [see video]
That's a little perplexing, given that Admiral Thad Allen said on August 9th that dispersants have not been used in the Gulf since mid-July:
We have not used dispersant since the capping stack was put on. I believe that was the 15th of July.

BP's Wells Says He Doesn't Know Who Was in Charge
By Joe Carroll and Katarzyna Klimasinska
Aug. 26 (Bloomberg) -- BP Plc'sKent Wells, a senior vice president who joined the Gulf of Mexico oil-spill response two days after it began four months ago, said he doesn't know who was in charge aboard the Deepwater Horizon drilling rig when it exploded in April.
Wells told a federal panel today in Houston that he was concentrating on halting the spill and coordinating the cleanup, rather than examining who may have been at fault in the disaster that killed 11 people and spewed an estimated 4.9 million barrels of crude from the damaged Macondo well.

Key Karzai Aide in Corruption Inquiry Is Linked to C.I.A.
By DEXTER FILKINS and MARK MAZZETTI - NYTimes.com
KABUL, Afghanistan - The aide to President Hamid Karzai of Afghanistan at the center of a politically sensitive corruption investigation is being paid by the Central Intelligence Agency, according to Afghan and American officials.
Mohammed Zia Salehi, the chief of administration for the National Security Council, appears to have been on the payroll for many years, according to officials in Kabul and Washington. It is unclear exactly what Mr. Salehi does in exchange for his money, whether providing information to the spy agency, advancing American views inside the presidential palace, or both.

Is Iraq About to Fall to Iran?
By Joel Hilliker | theTrumpet.com
Iraq is headless, and America is leaving.
Since 2003, the U.S. has sacrificed over 4,400 of its soldiers and spent over a trillion dollars in Iraq. What is there to show for these enormous costs?
Iraq is bedlam. Violence continues to percolate. July was the country's deadliest month since May 2008. Five and a half months after elections, a government still has not formed. In the meantime, the prime minister has agreed not to make any major decisions about Iraq's future.
This is a shell of a country. Ripe for conquest.

The U.S. Wants to Save the World From Terrorism,
Who Will Save the World from the U.S.?
Iza’as Almada is a writer and columnist for the NR
The arrogance and the false air of superiority with which the U.S. government behaves in the contemporary world, besides tiring, are becoming a danger to the survival of humanity. To my knowledge, except for the few countries whose governments maintain a totally submissive stance to the interests of Americans (and I refer to the heads of Colombia, Costa Rica, Saudi Arabia and South Korea as the most significant examples), none of us mortals gave procuration to Washington to think and act on our behalf.
This "fight against terrorism," to "defend democracy" and the "war on drugs" already does not convince anyone. Who wants to cheat Uncle Sam? Fight against terrorism? But who armed the Taliban? Who created Osama Bin Laden? Who tortures innocents in Guantanamo Bay? Who supported the majority of the military coups in Latin America in the '50s, '60s and '70s and the recent coup in Honduras? Who supported Operation Condor and practiced terrorist attacks in the Southern Cone? Who financed terrorists like Posada Carriles, who lives in exile in the U.S.?

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Thursday 08.26.2010

Relax America, The Global Elites Love You
By Giordano Bruno - Neithercorp Press
In the grand scheme of history, in the great wash of the collective American cosmos, in the midst of the day to day howls and earth rattles of towering financial and political giants, many of us tend to see ourselves as "the little people". We consider ourselves inconsequential in the wake of epic events that appear to rise and fall like irregular tides and determined by some frenetic force of chance; a great cultural roulette wheel. In fact, we are often encouraged to emulate this belief. Better to roll with the river of difficult times than to fight against the current in a fruitless attempt at changing its direction. Better to let more important and more powerful men blaze the trails that we will later follow, right...?
Human beings have a strange attachment to the concept of the "decision makers vs. the decision followers", even in the U.S. The Declaration of Independence was meant to herald the birth of a society which dissolved the separation between the rulers and those who are ruled. Our country was built upon the premise that every citizen has a right to participate in the making of his own providence, to play a part in the decisions that directly or indirectly affect his future. Of course, those were the days when average Americans saw themselves as giants, as innovators of history, not as little people.

USA a failed state? It may be closer than you think
By Paul Wallis - DigitalJournal.com
There's only one common factor in the failure of great nations: Mismanagement. The USA is heading down a well traveled road to its own Armageddon. Rome, China, Russia, the British Empire and others have all been there before.
The Caligula- like state of the US as a corporate entity is hardly a secret. Caligula made his horse a god, the US media has made dis-informative demagogues gods. Any factually inaccurate piece of information has a fairly good chance of becoming accepted as gospel truth in this environment.

Putting the Brakes on ObamaCare
How a Republican Congress could begin the process of repealing this unpopular law. By GRACE-MARIE TURNER - WSJ.com
If Republicans take control of one or both houses of Congress this fall, many will have been elected with a promise to "repeal and replace" ObamaCare. But what are their options, really? There likely will be an initial showdown, but President Obama will surely veto any challenge to the law, and it would be hard to imagine mustering the votes to overturn it.
Information is the key weapon. Republicans can use congressional hearings to explain what ObamaCare is doing to the economy and the health sector. Their strongest cases would be built around jobs, the cost of health care, and the rising deficit.

Headlines Sound the Alarm about Deeper Economic Problems
By: Paul Mladjenovic - Safehaven.com
The following three headlines are alarming symptoms of the economic insanity unfolding before our eyes:

1. "Philly requiring bloggers to pay $300 for a business license"
2. "LA unveils $578-Million school, costliest in the nation"
3. "Record Number Of Americans Using Retirement Funds As Source Of Immediate Cash"

Yes, those are actual headlines. They may seem like random and disjointed stories but really they are connected to the same economic and financial crisis that is here now and threatens to get much worse.
Philadelphia is forcing bloggers that make little or no money cough up $300 for what is annoyingly labeled a "Business Priviledge Tax". The struggling city is searching for new revenue to pay for their over-spending. This silly tax may yield some modest revenue for the city but the unintended consequence will be to chase away budding entrepreneurs. In other words, they will get much less revenue than they think. This is at a time when they desperately need to attract and encourage entrepreneurs.

The Nonsense Recovery
By Bill Bonner - The DailyReckoning.com
08/25/10 Ouzilly, France - Eventually, investors are going to realize that the discussion of a "recovery" is nonsense. The economy can never recover the pace and frenzy of the bubble years - and so much the better. It has to move on to something new. The big question is: What will this new economy look like?
One important detail: in this new economy US stocks are not likely to be as highly prized as they are now. That is not to say that companies won't make money. They will - especially those that are taking advantage of strong rates of growth overseas. But investors are likely to appreciate them less regardless. That's what happens in a bear market: the price-to-earnings ratio falls. Earnings do not necessarily go down; but the multiple investors are willing to pay for each dollar of earnings does.

The trillion dollar bailout you didn't hear about
Commercial real estate values plummet again yet banks hide losses. A $3.5 trillion financial disaster in the making.
We are now proud owners of an AMC theater and Chick-fil-A.
MyBudget360.com
The latest data on existing home sales should tell you exactly where we are in this so called recovery. Average Americans are unable to purchase big ticket items without massive government subsidies. It is also the case that all the too big to fail banks are standing only because of the generous support of taxpayer money. Without large tax credits and the Federal Reserve buying down mortgage rates the housing market is extremely weak. Yet very few of the housing "analysts" actually bother to ask why they are weak in the first place. The employment market is in disarray and wages have fallen for everyone outside of the top 1 percent of income earners. The bailout fatigue is running out of steam but banks are using clandestine methods to offload trillions of dollars of commercial real estate to taxpayers. The next giant bailout is already happening but you probably haven't heard about it.

10 Practical Steps That You Can Take To Insulate Yourself
(At Least Somewhat) From The Coming Economic Collapse
TheComingEconomicCollapseBlog.com
Most Americans are still operating under the delusion that this "recession" will end and that the "good times" will return soon, but a growing minority of Americans are starting to realize that things are fundamentally changing and that they better start preparing for what is ahead. These "preppers" come from all over the political spectrum and from every age group. More than at any other time in modern history, the American people lack faith in the U.S. economic system. In dozens of previous columns, I have detailed the horrific economic problems that we are now facing in excruciating detail. Many readers have started to complain that all I do is "scare" people and that I don't provide any practical solutions. Well, not everyone can move to Montana and start a llama farm, but hopefully this article will give people some practical steps that they can take to insulate themselves (at least to an extent) from the coming economic collapse.

1. Get Out Of Debt:
2. Find New Sources Of Income:
3. Reduce Your Expenses:
4. Learn To Grow Your Own Food:
5. Make Sure You Have A Reliable Water Supply:
6. Buy Land:
7. Get Off The Grid:
8. Store Non-Perishable Supplies:
9. Develop Stronger Relationships:
10. Get Educated And Stay Flexible:

Morgan Stanley: Government Defaults Inevitable
JESSE'S CAFÉ AMÉRICAIN
In addition to "It's different this time" one of the deadliest assumptions is "It can never happen here."
Morgan Stanley says what we have all known for some time. There will be government defaults of various types on debts which have become unmanageable.
As we see in a UK Telegraph story today, a report claims the Tories are placing the greatest pain in managing their budget gaps on the backs of the less well to do, presumably protecting their more well to do constituency. No surprise to anyone if it is true. And yet this may not be enough unless the economy recovers and the great mass of the public can regain some reasonable level of organic economic activity.

Roubini Says Third Quarter Growth in U.S. to Be "Well Below" 1%
By Bob Willis
Roubini Sees U.S. Growth Below 1%,
Chance of Double-Dip Recession at 40%
Aug. 25 (Bloomberg) -- Nouriel Roubini, the New York University economist who predicted the global financial crisis, said U.S. growth will be "well below" 1 percent in the third quarter and put the odds of a renewed recession at 40 percent.
Roubini, chairman of Roubini Global Economics LLC, said his forecast assumes the government will lower its estimate for growth in the second quarter to an annual rate of 1.2 percent "at best."
"All the growth tailwinds of the first half of the year become headwinds in the second half," he said in an e-mail message, including the government's $814-billion stimulus plan, hiring for the census, and incentives such the cash-for-clunkers program and tax credits for first-time home buyers.

The Fed's Biggest Bubble
By: Michael Pento - Safehaven.com
I've made a living out of exposing economic fallacies, but there's one whale that I can't seem to harpoon. Even top-flight Wall Street analysts seem to believe that the Fed's doubling of the monetary base after the credit crunch has not had an inflationary impact on our economy. Their logic can be summed up like so: "The money the Fed created and dropped from helicopters has all been caught in the trees." In other words, the Fed is creating money, but it is just being held as excess reserves by the banking system instead of being loaned to the public. Therefore, the money supply hasn't truly increased, there is no money multiplier effect, and aggregate price levels are behaving themselves.

As economy slows and Fed voices conflict, markets look to Bernanke for guidance By Neil Irwin - Washington Post Staff Writer
With the housing market retreating, unemployment lingering and top officials at the Federal Reserve in open disagreement over what to do, Fed Chairman Ben S. Bernanke is under rising pressure to offer solutions in an address Friday that is likely to be his most important since the end of the financial crisis.
The central bank's policy intentions have been unusually muddled in the past two months, according to a widespread view among economists and people in the financial world. They say it is unclear how likely it is that the Fed will undertake major new efforts to try to support the economy, what economic conditions would trigger such actions and what form those actions would take.

The Idiots Guide to Repairing an Economy
By Bill Bonner - The DailyReckoning.com
08/25/10 Ouzilly, France - Too bad Thomas Friedman has stopped writing about the economy. We could use a good laugh this morning. Chilly winds are blowing across this part of France. The children have all gone. The sun is low and cool. It's quiet here, and a bit sad.
But Friedman has moved on to giving bad advice on other subjects.
So, this morning we turn to Bob Burnett, "retired Silicon Valley executive." Mr. Burnett is writing on a site that we believe is part of The Huffington Post. His photo shows a man who seems affable. At least, he's smiling. The edges of his mouth curl up, revealing the incipient insanity of the self-assured. He knows what he knows; too bad that what he knows isn't so.

Earth to Bill Gross:
We Chickens Know You Are The Fox Minding the Henhouse
NakedCapitalism.com
Boy, when you think you've seen the worst in utterly shameless, self serving tripe, someone manages to outdo it. Admittedly, it's awfully hard to beat Steve Schwarzmann's recent one-two punch of utter canard wrapped in tasteless hyperbole, that of Obama proposals that private equity kingpins pay taxes on what is really the fruits of their labor like other working stiffs was a "warÉ like when Hitler invaded Poland in 1939."
But no, Pimco's Bill Gross bests Schwarzmann in making it clear to the great unwashed his unabashed belief that what is good for him is good, period. Schwarzmann is a tad less horrid by at least limiting his grandiose claims to his own industry. Gross is marginally less offensive to good taste (although a discussion of his body odor in an investment piece is certainly a novel wrinkle), but makes it up by insulting his audience's intelligence, namely, by presenting himself as a staunch ally of the little guy.

Recession Double Dippers In The Ascendancy
By: PaddyPowerTrader - MarketOracle.co.uk
US stocks declined Tuesday, sending the S&P 500 Index to a seven-week low, as a record plunge in home sales cast further doubt on the viability of the economic recovery as the battle between "moderators" and "double dippers" is currently being won hands down by the latter. Existing US home sales where a real horror show - resales dropped a record 27.2 percent-nearly twice as much as analysts had expected - to an annual rate of $3.83 m in July, the National Association of Realtors said Tuesday. Meanwhile, inventories rose to 12.5 months from 8.9 months in June, pressuring already depressed home prices. Inventories are at their highest level in more than a decade.

Silver and Gold Breaking Out As Safe Haven Buying Continues
By: Jeb Handwerger - Safehaven.com
Silver had very powerful break out today as investors are seeking assets that are safe and will retain value during a debt crisis. Silver is seeing demand at these price levels as it is historically cheap relative to gold. If the ratio came down to the levels it was in 2006 it would be close to $27 an ounce. Silver is soaring because investors are realizing this is a hard asset, it is money and it is historically cheap compared to gold.
Gold has reached overbought conditions from my July 28th buy signal. Right now gold is a bit overbought while silver is at an interesting buy point, having found support for the fourth time at its long term 200 day moving average. Today's breakout of the symmetrical triangle, a very bullish chart pattern, is a sign that silver has built up a lot of internal strength and could break out into new three year highs. Remember, silver is significantly below all time highs while gold has already broken into new highs.

Gold May Gain to $1,252 an Ounce
By Wendy Pugh
Aug. 26 (Bloomberg) -- Gold may climb to as high as $1,252.35 an ounce, as long as prices do not drop below the 55- day moving average for two consecutive days, according to a report from Commerzbank AG technical analyst Axel Rudolph.
The precious metal has rallied from a three-month low on July 28 as concern that the global economic recovery is slowing boosted investment demand. Spot gold closed at $1,240.05 yesterday, the highest price in eight weeks and 2 percent from the record $1,265.30 reached on June 21.

How Financial Instruments Suppress Silver's Value
By: Dr Jeff Lewis - MarketOracle.co.uk
One fact is very, very clear: the silver markets are horribly suppressed. As we reported months ago, it was discovered in May that the silver futures market is purely paper, and there is an actual whistleblower to tell the tale. However, that testimony was subsequently squandered when the closed circuit TV had "technical errors," and days later Andrew Maguire, the famed whistleblower, was in a hit and run accident.
However, not all of the suppression talk need be reserved for so called "conspiracies," as silver is suppressed right before your eyes.

Gold and Silver Protection From Economic Cancer and Desperation of QE2 By: Jim Willie CB - MarketOracle.co.uk
History is being made. The American public has never been no nervous, perhaps fearful of something dreadful and imminent. The global monetary system is crumbling. The typical stimulus has failed to jumpstart the USEconomy. The 20 months of near 0% short-term official interest rate has failed to revive the moribund US housing market. The phony FASB accounting rules has failed to accomplish anything except a stay of execution for the big US banks, which do not lend much. In fact, the US banks are largely dead entities showing enough life for to receive USGovt largesse aid. Witness the failure of the US financial sector. Witness the climax chapter of failure for the Fascist Business Model.

Safe-haven buying lifts gold to 8-wk highs
Reuters - businessday.co.za
Gold rose for a second day on Wednesday to eight-week highs near $1240 an ounce as the dollar fell against the euro and concern over economic growth hit equities, sparking interest in the metal as a safe haven
Gold rose for a second day on Wednesday to eight-week highs near $1240 an ounce as the dollar fell against the euro and concern over economic growth hit equities, sparking interest in the metal as a safe haven.

You'll Buy Gold Now and Like It!
By: Jeff Clark - Safehaven.com
I get this question a lot: "Should I buy gold now, or wait for a pullback?"
It's a valid question. For nearly two years, gold hasn't had a serious decline. There have been pullbacks, of course, but nothing assumption-challenging. In fact, since October 2008, gold's largest price drop is 10.6% (based on London PM fix prices), and yet the average of all declines since 2001 is 13% (of those greater than 5%). The biggest pullback we've seen this summer is 8.2%. Technically the summer's not over, but I'll admit I'm surprised we haven't had a better buying opportunity.

GOLD RUSHING ON
Submitted by Frank Holmes - FinancialSense.com
The World Gold Council's latest quarterly recap of the gold market confirms much of the big-picture story we already knew: demand is strong (up 36 percent from a year earlier), supply is not keeping pace (up 17 percent), and global economic worries are driving investors toward gold as a safe haven.
Drilling down a little further turns up a number of interesting points:

China's Gold Demand: Saving, Not Spending
By: Adrian Ash - Safehaven.com
What jewelry-selling Western consumers have discovered about China's gold buying...
WHATEVER the reasons for China's massive household savings rate (Western economists blame the lack of social security, so you can guess their cure), the World Gold Council's Gold Demand Trends today showed private consumers putting ever-more money into physical gold.
Compared to household savings, in fact, revised forecasts here at BullionVault this morning put likely gold purchases in 2010 at the equivalent of almost 1.7% - over twice the level of five years ago.

Ron Paul Calls for Audit of US Gold Reserves
TEXAS (Kitco News): U.S. Rep. Ron Paul, R-Tex, plans to introduce a new bill next year that will allow for an audit of US gold reserves, he told Kitco News in an exclusive interview.
Paul dropped the news in the interview, indicating that the bill still does not have an official name yet but will be unveiled at the start of the new U.S. Congress.
"If there was no question about the gold being there, you think they would be anxious to prove gold is there," he said of the Federal Reserve.
This is not the first time the congressman has made his pitch. "In the early 1980s when I was on the gold commission, I asked them to recommend to the Congress that they audit the gold reserves - we had 17 members of the commission and 15 voted not to the audit," said Paul. "I think there was only one decent audit done 50 years ago," he said.

Inflation versus Deflation Debate Part 2
By: Fred Sheehan - MarketOracle.co.uk
Inflation versus deflation discussions are the rule for columnists, economists and BubbleTV. This false distinction is potentially harmful for investors and shoppers who think they must decide between the two, then act. Inflation and deflation act contemporaneously. The relative movement of what is inflating and what is deflating (e.g., common stocks vs. gas, bonds vs. bread) influences, and possibly changes, the way we live.

Inflation Follows the Stimulus Boom
By: The Mogambo Guru - Savehaven.com
Peter Schiff of Euro Pacific Capital notes that the Federal Reserve, and the idiots like Paul Krugman who genuflect at the altar of Keynes, is not done with destroying the economy, but that "Bernanke and his supporters have said that their stimulus will be withdrawn as soon as the recovery takes hold in earnest." Hahaha!
I laugh because this makes me think of my dad saying, in answer to my constant whining, "Shut up! I'll buy you a motorcycle when your Uncle Raymond pays me back the money I loaned him,' which finally got to be a family joke because Uncle Ray never came across with a dime because he was a penniless mooch all his life! Hahaha!

Fed to Outline Future Actions Friday
By SEWELL CHAN - NYTimes.com
WASHINGTON - With fresh signs that the housing market is weakening, the Federal Reserve chairman, Ben S. Bernanke, on Friday will offer his outlook on the economy, explain the Fed's recent modest move to halt the slide and possibly outline other actions.
Mr. Bernanke's speech, at an annual Fed symposium in Jackson Hole, Wyo., will be his first public comments since the Fed announced it would invest proceeds from its holdings of mortgage bonds to buy more long-term Treasury securities to prop up the recovery.

Goldman's Hatzius Says Fed Will Move Toward Additional Stimulus
By Bob Willis and Tom Keene
Aug. 24 (Bloomberg) -- The Federal Reserve will probably ease monetary policy further as the U.S. economy weakens, said Jan Hatzius, chief U.S. economist at Goldman Sachs Group Inc. in New York.
"The Fed will eventually move to additional monetary stimulus via asset purchases or other unconventional measures," Hatzius said in a radio interview today with Tom Keene on "Bloomberg Surveillance." Should the Fed opt for more securities purchases, he said, there is "no point in doing anything less than" $1 trillion.

Top book in China hammers Goldman Sachs
Calls company source of crisis
By Elaine Kurtenbach - Associated Press - WashingtonTimes.com
SHANGHAI | Goldman Sachs & Co., reviled in the U.S. for its role in the financial crisis, is now getting hammered in the world's No. 2 economy with a sensationalist new book accusing the investment bank of trying to destroy China.
The "Goldman Sachs Conspiracy," which has sold over 100,000 copies since it was released in June, reaching popular website Sina.com's top 10 list, follows another by author Li Delin, "Eliminate All Competitors - How Goldman Sachs Wins Over the World," published last year.

Debt crisis just beginning, Morgan Stanley says
by Colin Barr - Fortune CNN
This spring's bond market tussle in Europe was just a warm-up, Morgan Stanley says.
The investment bank warns in a report Wednesday that the sovereign debt crisis is far from over -- and won't end till deeply indebted rich country governments give holders of their bonds a good soaking.
The remarks amount to the latest warning issued to investors who have herded into government bonds this month, following a downturn in U.S. economic indicators and a series of anxious-sounding comments from Federal Reserve officials. The yield on the 10-year Treasury bond has plunged to a recent 2.45% from the already low level of 3% at the end of last month.

Obama should get rid of Geithner, Summers
It's time for a new economic theory
By Darrell Delamaide
WASHINGTON (MarketWatch) -- At last, an economic strategy that can muster truly bipartisan support: House Minority Leader John Boehner's call this week to fire Treasury Secretary Timothy Geithner and White House economic adviser Larry Summers.
Boehner, who was not previously known for his insights into economics, found a surprising resonance in the press with his call to get rid of President Barack Obama's top two economic aides.

Despite Reform, Banks Have Room for Risky Deals
By NELSON D. SCHWARTZ and ERIC DASH - NYTimes.com
When Congress passed a new financial regulation bill last month, it sought to prevent federally insured banks from making speculative bets using their own money. But that will not stop banks from making bets that some critics deem risky, even as the rules go into effect over the next few years.
That is because many such bets - on the direction of the stock market or the price of coal, for example - are done on behalf of clients. So, the banks say, they will continue to be allowable despite the new restrictions.

SEC backs labor on corporate board votes
By Patrice Hill - The Washington Times
Business groups denounce move as burdensome, favoring special interests
The Securities and Exchange Commission on Wednesday handed labor and social-activist groups a big victory by approving rules making it easier for them to put allies on corporate boards throughout the country.
The measure was approved on a 3-2 vote by a divided commission, with Republican members warning that the change may not pass muster in the courts. It is the first major regulation from last months landmark financial-reform law to win approval.

Chronicle - The Foundation
The Patriot Post
"We must not let our rulers load us with perpetual debt." --Thomas Jefferson
Editorial Exegesis
Obama's fiscal plan
"Speaking last Wednesday in Columbus, Ohio, President Obama asked, 'How do we, over the long term, get control of our deficit?' Good question. Here's the answer suggested by last Thursday's semi-annual budget summary from the Congressional Budget Office: Stop spending so much. CBO's mid-year review largely reinforces the bad news we already knew -- to wit, that spending has exploded since Democrats took over Congress in 2007, first with the acquiescence of George W. Bush and then into hyperdrive after Mr. Obama entered the White House. To appreciate the magnitude of this spending blowout, compare CBO's budget 'baseline' estimate in January 2008 with the baseline it released Thursday. The baseline predicts future spending based on the law at the time. ... In a mere 31 months Congress has added more than $4.4 trillion to the 10-year spending baseline. ... As recently as 2005, total federal spending was only $2.47 trillion.

Housing still at heart of our problems
Prices could fall a lot more before it's over
By MarketWatch
WASHINGTON (MarketWatch) -- How in the world can Americans feel secure or confident in the economy when the value of their single-biggest asset is dropping?
Americans have already lost more than $6 trillion, on paper, on the value of their homes. Millions have lost something more tangible: the roof over their heads.
Now, four years after the housing bubble began to explode, it looks like home owners may have to accept further losses before it's all over.

Plunge in Home Sales Stokes Economy Fears
By SUDEEP REDDY And NICK TIMIRAOS - WSJ.com
U.S. home sales plummeted in July to a level not seen in more than a decade, spurring fears of renewed weakness in housing prices and the broader economy.
Sales of previously owned homes fell 27.2% from June to a seasonally adjusted annual rate of 3.83 million, the National Association of Realtors said Tuesday, the lowest level since the industry group started its tally in 1999.
The expiration of a home-buyer tax credit in the spring was expected to damp buying, though less severely. Economists said the sales drop - together with a corresponding rise in the inventory of unsold homes - meant another decline in housing prices was on the horizon. House prices had stabilized last year after declining since 2006.

Recovery in Danger as Firms, Homebuyers Cut Back
By: AP - CNBC.com
The economic recovery appears to be stalling as companies cut back last month on their investments in equipment and machines and Americans bought new homes at the weakest pace in decades.
Overall orders for big-ticket manufactured goods increased 0.3 percent in July, the Commerce Department said Wednesday. But that was only because of a 76 percent jump in demand for commercial aircraft.

US mortgage lenders report profit despite home woes
By Dave Clarke
WASHINGTON, Aug 25 (Reuters) - The U.S. thrift industry reported $1.49 billion in profits for the second quarter, a slip from the previous quarter, but up from a $94 million loss a year ago.
It was the fourth consecutive profitable quarter for the industry, which reported a profit of $1.72 billion in the previous quarter.
The industry still faces challenges from delinquent loans, the Office of Thrift Supervision said on Wednesday.

Housing: The Lost Half Decade
BespokeInvest.com
While it has been a 'lost decade' for equities, housing isn't too far behind. The sector is now in the midst of a lost half decade and counting. Following up on yesterday's downright awful release of existing home sales, today's new home sales report for July came in at a seasonally adjusted annualized rate of just 276K, which is a record low dating back to 1963. Since peaking in July 2005, new home sales have now declined by more than 80% in five years. As seen in the chart, while the slope of the rally in housing was steep, the decline has been even steeper.

The Housing Mirage
By John Frisby - LuxLibertas.com
Homeowner subsidies have only delayed the day of reckoning.
Yesterday's news that sales of existing homes fell a record 27% in July did not trigger the end of civilization. Instead, while stocks generally declined on the news, shares of home building companies rallied on the chance that this market has finally found a bottom.
We make no predictions on whether the expected rebound in August or autumn sales will come to pass, after more than four years of a declining market and numerous federal programs delaying the inevitable correction. The trigger for yesterday's decline was the expiration of the $8,000 first-time home buyer tax credit, a political gimmick that altered the timing of some sales, provided a larger tax benefit to many people who were going to buy anyway, and did nothing to change the fundamental supply and demand for housing.

Existing Home Sales Plunge!
By Chuck Butler - The DailyReckoning.com
08/25/10 St. Louis, Missouri - An awful Existing Home Sales report yesterday is causing more people to jump on my bandwagon... You know, the one about the double dip recession, which will be fueled by another housing slump... Of course I call it a double dip, but in reality, I truly believe it to be a "single scoop," for I don't believe like our government officials, and Fed Heads that we "came out of the recession."... But that's just me, thinking logically, as always!
Did you strap yourself in for the Existing Home Sales for July report yesterday like I warned you to do? Good thing, because, July Existing Home Sales fell -27%!!!!! (Consensus was for a -12% decline!)

The Subprime Mortgage Crisis on Trial
Peter J. Henning - White Collar Watch - NYTimes.com
The financial crisis has led to only a few civil and criminal cases against executives, and even those focused on peripheral issues: Goldman Sachs's peddling of a credit derivative obligation and the communications of two former Bear Stearns hedge fund managers.
But the Securities and Exchange Commission's securities fraud action against Angelo R. Mozilo, former chief executive of Countrywide Financial, promises to feature the aggressive mortgage practices of what was then the nation's largest mortgage lender.

U.S. Economy: Durables, Housing Signal Recession Risk
By Timothy R. Homan and Courtney Schlisserman
Aug. 25 (Bloomberg) -- Orders for durable goods in the U.S. increased less than forecast in July and sales of new homes unexpectedly dropped, increasing the risk of a renewed recession in the world's largest economy.
Bookings for goods made to last at least three years rose 0.3 percent, figures from the Commerce Department showed today in Washington. Excluding transportation equipment, demand fell by the most in more than a year. Purchases of new dwellings fell 12 percent to an annual pace of 276,000, the weakest since data began in 1963, figures from the same agency showed.

Inventory Explodes Past the Worst of the Housing Crash
by Michael David White - HousingStory.net
Soft demand for existing homes pushed up inventory to a record 12.5 months of sales and easily broke the previous high of 11.3 months scored in April 2008. By this basic measure, the price of homes may reasonably be expected to fall at the most torrential pace seen during our four-year-old crash.
Yet you will see only the most tepid warnings of this risk as described by the mainstream media with results released today being worse than the most pessimistic forecast of economists surveyed by Bloomberg News. Please review the chart (above) and note that it is in record territory for the history of months-of-inventory for sale.

The Five Stages of America's Housing Bubble
by Michael David White - HousingStory.net
See charts

Budget hits families and pensioners twice as hard
Telegraph.co.uk
Pensioners and families with children will be the biggest victims of George Osborne's emergency Budget, according to an analysis published today.
The Institute for Fiscal Studies says the two groups will lose much more of their income than childless couples over the next four years because of the Coalition's tax and benefit changes.
According to the institute, the country's leading economic think tank, this is because the increase in VAT and other taxes combined with changes to the benefit system will disproportionately affect pensioners and families.

Disabled Face Sharply Higher Jobless Rate
By SARA MURRAY - WSJ.com
The government's first detailed look at disabled workers' employment shows they are far more likely than the overall work force to be older, working part-time or jobless.
The average unemployment rate for disabled workers was 14.5% last year, the Labor Department said Wednesday, well above the 9% rate for those without disabilities. By the Labor Department's count, there were roughly 27 million Americans 16 years or older with a disability last year.
The employment situation doesn't appear to have improved this year: The unemployment rate for those with disabilities had risen to 16.4% as of July.

We Killed The Goose That Laid The Golden Egg
And Now The Number Of Americans Receiving Long-Term Unemployment Benefits Has Risen A Whopping 60 Percent In Just One Year TheEconomicCollapseBlog.com
For middle class Americans, the new global economy has provided mountains of cheap products made in China, India and dozens of other nations, but it has also killed the goose that laid the golden egg. Millions of American workers have been discovering that the price for all of those inexpensive foreign-made goodies is their jobs. Now we have so many long-term unemployed workers in the United States that we are inventing new terms (such as "the 99ers") to describe them. Unemployment is on the rise again (we'll get to the figures in a minute) and everyone seems perplexed at the continuing inability of the "greatest economy in the world" to provide jobs for everyone. But the truth is that this has been coming for a long time. The debt-fueled prosperity of the past couple of decades allowed us to live far beyond our means and provide very high levels of employment for a while, but now economic reality is setting in. The millions of middle class jobs that have been shipped overseas are never coming back. Unfortunately, the existence of a large class of chronically unemployed Americans that are struggling just to survive is going to quickly become "the new normal".

Retiree Ponzi Scheme Is $16 Trillion Short
Commentary by Laurence Kotlikoff
Aug. 25 (Bloomberg) -- Social Security just celebrated its 75th birthday. Love it or hate it, it has done its job and should retire. We need a new system, the Personal Security System, which retains Social Security's best features, scraps the rest, and covers its costs.
Social Security's objective -- forcing people to save for retirement -- is legit. Otherwise millions of us would seek handouts in our old age.
But Social Security has also played a central role in the massive, six-decade Ponzi scheme known as U.S. fiscal policy, which transfers ever-larger sums from the young to the old.

Seniors may be forced to swap health care plan
By Ricardo Alonso-Zaldivar - AP - WashingtonTimes.com
More than 3 million seniors may have to switch their Medicare prescription plan next year, even if they are happy with it, as a result of an attempt by the government to simplify their lives.
The policy change could turn into a hassle for seniors who hadn't intended to switch plans during Medicare's open-enrollment season this fall.
And it risks undercutting President Obama's promise that people who like their health care plans can keep them.

California to Delay Payments Sooner than Expected
AP - CNBC.com
Gov. Arnold Schwarzenegger, California's state controller and treasurer, decided Monday to delay $2.9 billion a month in payments to school districts and counties sooner than expected so the state can meet debt and pension obligations.
The leaders issued a joint letter notifying state lawmakers of their decision to begin withholding the payments in September instead of October.
The move reflected the limited resources the state has to work with as the impasse over California's $19 billion budget shortfall has dragged on for nearly two months.

Google Is Offering Phone Calls via Gmail
By CLAIRE CAIN MILLER - NYTimes.com
SAN FRANCISCO - Google entered a new businesses beyond Internet search on Wednesday with a service within Gmail to make phone calls over the Web to landlines or cellphones.
The service will thrust Google into direct competition with Skype, the Internet telephone company, and with telecommunications providers. It could also make Google a more ubiquitous part of people's social interactions by uniting the service for phone calls with e-mail, text messages and video chats.

The dirty little secret about Google Android
Author: Jason Hiner - TechRepublic.com
Google Android began with the greatest of intentions - freedom, openness, and quality software for all. However, freedom always comes with price, and often results in unintended consequences. With Android, one of the most important of those unintended consequences is now becoming clear as Google gets increasingly pragmatic about the smartphone market and less and less tied to its original ideals.
Here's the dirty little secret about Android: After all the work Apple did to get AT&T to relinquish device control for the iPhone and all the great efforts Google made to get the FCC and the U.S. telecoms to agree to open access rules as part of the 700 MHz auction, Android is taking all of those gains and handing the power back to the telecoms.

Cell Towers For the Home Work Best in Worst Sites
by Walter S. Mossberg - AllThingsD
If you have lousy cellphone reception in your house, you may have wished you had a cellular tower nearby. Well, now you can buy your own and plant it right inside your home.
Verizon (VZ), Sprint (S) and AT&T (T) all have started selling gadgets that act as mini-cell towers, broadcasting wireless phone service just like a real cell tower does, though over a much smaller area: a single house.

Chinese Authorities Move to Ease Jam
By SHAI OSTER - WSJ.com (free)
BEIJING - Emergency measures appeared Wednesday to have eased congestion on a main route into the capital that was the scene of a massive traffic jam that lasted more than 10 days and drew widespread media attention.
Still, trucks remained backed up at the border between Inner Mongolia and Hebei province, about 150 miles from Beijing, as authorities there held back traffic to help clear a badly blocked stretch of road closer to the city, state media said.

Mexican Military Finds 72 Bodies Near Border
By DAVID LUHNOW and JOSE DE CORDOBA - WSJ.com (free)
MEXICO CITY - Gunmen from a drug cartel appear to have massacred 72 migrants from Central and South America who were on their way to the U.S., a grisly event that marks the single biggest killing in Mexico's war on organized crime.
Mexican marines discovered the 72 bodies - 58 men and 14 women - on Tuesday after the lone survivor of the massacre, a wounded migrant from Ecuador, stumbled into a Navy checkpoint the previous day and told of being shot on Monday at a nearby ranch, Mexican officials said on Wednesday.

Two minutes to midnight?
By Tony Karon - AsiaTimes
America's march to a disastrous war in Iraq began in the media, where an unprovoked United States invasion of an Arab country was introduced as a legitimate policy option, then debated as a prudent and necessary one. Now, a similarly flawed media conversation on Iran is gaining momentum.
Last month, TIME's Joe Klein warned that Barack Obama administration sources had told him bombing Iran's nuclear facilities was "back on the table". In an interview with CNN, former Central Intelligence Agency (CIA) director Admiral Mike Hayden next spoke of an "inexorable" dynamic toward confrontation, claiming that bombing was a more viable option for the Obama administration than it had been for his predecessor, George W Bush.

BP frozen out of Arctic oil drilling race
Terry Macalister in Nuuk -guardian.co.uk,
British energy giant BP forced to abandon hopes of Greenland exploration owing to tarnished reputation from Gulf oil spill
BP has been forced to abandon hopes of drilling in the Arctic, currently the centre of a new oil rush, owing to its tarnished reputation after the Gulf of Mexico spill.
The company confirmed tonight that it was no longer trying to win an exploration licence in Greenland, despite earlier reports of its interest. "We are not participating in the bid round," said a spokesman at BP's London headquarters, who declined to discuss its reasons for the reverse.

BP executive says blowout preventer was not connected properly
By David S. Hilzenrath - WashingtonPost.com
As BP and Transocean officials struggled to contain the oil gusher in the Gulf of Mexico, they discovered that the plumbing on the blowout preventer was connected improperly, a BP executive testified Wednesday.
"It would mean that the pipe rams could not be closed," said Harry Thierens, BP executive vice president for drilling and completions. "I was frankly astonished that this could have happened."
Thierens was testifying in Houston before a federal panel investigating the April 22 disaster.

John McCain wins Arizona Republican primary
Ewen MacAskill in Washington - guardian.co.uk
Former presidential candidate triumphs against Tea Party-backed talkshow host with a little help from Sarah Palin
The former Republican presidential candidate, John McCain, has repulsed a challenge from rightwing conservatives by defeating a talk-radio personality in the Arizona primary.
The Tea Party activists had hoped to claim their biggest scalp of the Republican primary season but McCain - seeking a fifth term as senator - saw off JD Hayworth, a former congressman and conservative radio talkshow host.
At the end of a bruising campaign, one of McCain's spokesmen on Tuesday morning described Hayworth "as dead as Elvis".

Murkowski trails tea party foe in Alaska
Joe Miller ahead in Senate race
By Sean Lengell - The Washington Times
Alaska Sen. Lisa Murkowski trails a "tea party"-backed challenger by a slim margin in the state's Republican primary held on Tuesday that's still too close to call.
If the results hold, Mrs. Murkowski would join a growing list of Republican Party insiders who have fallen to political upstarts in primary elections in a year that has featured an unusually high level of GOP infighting.
"It was really her race to lose, and she's almost lost it," said University of Alaska at Fairbanks political science professor Jerry McBeath. "It's going to be very difficult for her to come through."

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Wednesday 08.25.2010

The Fed Can Create Money, Not Confidence
Inflation - or stagflation - remains the more serious danger than deflation. By GEORGE MELLOAN - WSJ.com (free)
A report by the Federal Reserve Bank of New York last week showed that consumers are having difficulty climbing out of the debt hole they dug for themselves before the credit bubble began to deflate in late 2007. The report gives support to the fears of those asset managers and economists who believe the U.S. is facing deflation.
Bill Gross, manager of the $239 billion Pimco bond fund, is one. His evidence is that the Consumer Price Index (CPI), annualized over the last two years, has fallen slightly.

This Economy Is Ripping The Dignity Of Millions
Of Unemployed Americans To Shreds
TheEconomicCollapseBlog.com
If you can still put a roof over your head and food on the table for your family, you should consider yourself to be very fortunate. There are millions of Americans out there right now that are really, really suffering. The cold, hard reality of it is that there aren't even close to enough jobs out there for everyone right now. It is almost as if we are all caught in a really bizarre game of musical chairs where the losers get stripped of their tickets to the middle class. What this horrible economy is doing to the dignity of millions of middle class Americans is incredibly saddening. There are a lot of very highly educated and very hard working Americans who cannot seem to get jobs no matter what they do and now find themselves doing whatever they can just to survive. It can be really hard to keep your dignity when you played by all the rules and you worked as hard as you could all your life and now you find yourself a half step away from being homeless. Those of us who are still doing okay should never look down on those who are struggling in this economy, because the truth is that any of us could be next.

THE TRUE NATIONAL DEBT
By Jim Quinn - TheBurningPlatform.com
When I read Paul Krugman and the other Keynesian boneheads saying that our debt is not a problem, they quote figures about our debt of $13.3 trillion versus our GDP of $14.6 trillion not being so bad. That is only 91% of GDP. They point to World War II when our national debt reached 120% of GDP. They say everything worked out after that.
Well lets analyze that comparison for just a second. In 1945, Europe, Russia and Asia lay in ruins. The devastation was epic. The United States stood alone as the only unscathed country in the world. America became the manufacturer to the world. We rebuilt Europe and Asia. Our GDP soared, as our National Debt declined from $269 billion in 1946 to $255 billion in 1951, remaining below $300 billion until 1963.
Today our reported National Debt is $13.362 TRILLION. This is the first big lie.

The Multi-Trillion Dollar Debt and What It Mean
to Your Standard of Living Right Now
by Robert Wenzel - EconomicPolicyJournal.com
Current U.S. debt stands at $13,363,228, 000, 000. This number is often broken down on a per capita basis, currently $44,000.
I have always thought of the per capita number as somewhat misleading. I'm guessing that most people who don't have $44,000 in the bank, shrug and think, "Good luck with collecting that from me."
But the way the $13,363,228, 000, 000 should be looked at is debt that results in that much money not being available for private sector business to borrow. It boggles the mind to think what research could be conducted and products produced and created if that money was available for the business sector. In this fashion, the huge debt is impacting the person, right now, who doesn't have $44,000 in the bank, by the products that haven't been created because of the debt. One has to wonder how higher a standard of living a person would face, who doesn't have $44,000 in the bank, but who would live in a world where government borrowed so aggressively.

Economy Caught in Depression, Not Recession: Rosenberg
By: Jeff Cox - CNBC.com Staff Writer
Positive gross domestic product readings and other mildly hopeful signs are masking an ugly truth: The US economy is in a 1930s-style Depression, Gluskin Sheff economist David Rosenberg said Tuesday.
Writing in his daily briefing to investors, Rosenberg said the Great Depression also had its high points, with a series of positive GDP reports and sharp stock market gains.
But then as now, those signs of recovery were unsustainable and only provided a false sense of stability, said Rosenberg.

Recession or Depression?
David Rosenberg, Gluskin Sheff & Associates chief economist, discusses his belief that we are in a depression, a prolonged recession, despite the government's best efforts.

Dow Faces Bouncy Ride to 5,000
By: CNBC.com
The Dow Jones Industrial Average will lose about half of its value over the next couple of years as it follows a Nikkei-like pattern of several sharp rallies in an overall decline, according to Charles Nenner, founder and president of Charles Nenner research.
Stocks are currently in a bear-market rally, and looking at charts and past trends, unemployment and leading indicators suggest the Dow will drop to 5,000 in the next two to two-and-a-half years, Nenner told CNBC in an e-mail.
Deflation will arrive, along with a sharp double-dip recession, pushing the Dow lower, although, like the Japanese market, stocks will see several jumps of 30 percent to 40 percent, he said.

Charles Nenner on CNBC: Dow 5,000 (Interview with Maria Bartiromo - July 2010)

Precipitous market drop will be bullish for Gold
CommodityOnline.com
Addicted to Profits Newsletter Writer David Skarica has an addiction that might just benefit you. David is addicted to making himself and his subscribers money. In this exclusive interview with The Gold Report, David predicts that the U.S. economy will decline very slowly, describing the process as "Chinese water torture." David says any precipitous market drop will be pre-empted by further quantitative easing. And this, he says, will be bullish for gold. He also names some companies that might help folks suffering David's sweet affliction.

Rethinking Gold: What if It Isn't a Commodity After All?
Jeff D. Opdyke - SilverBearCafe.com
This won't sit well with some people: Gold isn't a commodity. There. I've said it.
But before you fire off an angry response, hear me out. The facts might change your view of gold's role in a portfolio.
For a long time, we've all heard that gold is a commodity - no different, really, from silver or wheat or pork bellies. Its price ebbs and flows (supposedly) with inflation, which historically drives commodity prices.
Odd, then, that gold's elevated price hasn't fallen in response to tepid U.S. inflation numbers. The Consumer Price Index as of July pegged inflation at just 1.2% for the previous 12 months, not counting seasonal adjustments. Nor has gold reacted to what Mohamed El-Erian, Pimco's chief executive, recently called "the road to deflation" on which he sees the U.S. traveling.
Data show that gold closely mirrors the movement of the U.S. dollar.

Silver plays double regardless of economic conditions
By Richard Mills - CommodityOnline.com
As a general rule, the most successful man in life is the man who has the best information in the time of the ancient Babylonians - long before the periodic table - there were seven sacred metals: gold, silver, copper, iron, tin, lead and mercury.
In Roman and Greek Mythology, the First Age was called Golden, the Second Age Silver. Apollo, the god of truth and light, and teacher of medicine, carried a silver bow.

Peter Schiff and Marc Faber on CNBC 8/23/10:
Time to Flee U.S. Treasuries!

Bancor:
The Name Of The Global Currency
That A Shocking IMF Report Is Proposing
TheEconomicCollapseBlog.com
Sometimes there are things that are so shocking that you just do not want to report them unless they can be completely and totally documented. Over the past few years, there have been many rumors about a coming global currency, but at times it has been difficult to pin down evidence that plans for such a currency are actually in the works. Not anymore. A paper entitled "Reserve Accumulation and International Monetary Stability" by the Strategy, Policy and Review Department of the IMF recommends that the world adopt a global currency called the "Bancor" and that a global central bank be established to administer that currency. The report is dated April 13, 2010 and a full copy can be read here. Unfortunately this is not hype and it is not a rumor. This is a very serious proposal in an official document from one of the mega-powerful institutions that is actually running the world economy. Anyone who follows the IMF knows that what the IMF wants, the IMF usually gets. So could a global currency known as the "Bancor" be on the horizon? That is now a legitimate question.

"Enron Accounting" Has Bankrupted America:
U.S. Deficit Really $202 Trillion, Kotlikoff Says
by Peter Gorenstein - TechTicker
The Congressional Budget Office (CBO) forecasts the U.S. budget deficit will hit $1.3 trillion this year. An astronomical figure, to be sure, but that's lower than was projected in March. It's also less than last year's record $1.41 trillion deficit, which was close to 10% of GDP.
And, that's the good news.
As the deficit grows so does the national debt, which is currently more than $13.3 trillion, according to official figures.
But the situation is actually much, much worse, according to Boston University economics professor Laurence Kotlikoff.

Boehner: Geithner and Summers should go
'Virtually' no one in the White House has run a small business
By Ronald D. Orol, MarketWatch
WASHINGTON (MarketWatch) -- President Barack Obama should call for the resignation of both Treasury Secretary Timothy Geithner and Larry Summers, the head of the White House's national economic team, House Minority Leader John Boehner said Tuesday.
"President Obama should ask for -- and accept -- the resignations of the remaining members of his economic team, starting with Secretary Geithner and Larry Summers," Boehner (R., Ohio) said in an economic address to the City Club of Cleveland.
The comments came as Republicans prepare their economic line of attack ahead of mid-term elections for Congress.

Boehner: Obama economic team should resign
By thomas Ferraro - Reuters via MSNBC.com
John Boehner urges Obama to oust economic team
WASHINGTON - The top Republican in the House of Representatives called on Tuesday for President Barack Obama to fire his economic team in a campaign-style speech meant to focus voters on the weak American economy.
House Republican leader John Boehner said Obama should begin clearing house by replacing Treasury Secretary Timothy Geithner and White House economic adviser Larry Summers.
"It's time to put grown-ups in charge. It's time for people willing to accept responsibility," Boehner told a civic group in Cleveland.

Geithner Resignation Calls May Increase as 2010 Election Nears
By Robert Schmidt and Lorraine Woellert
Nov. 20 (Bloomberg) -- U.S. Treasury Secretary Timothy Geithner, as part of a grilling on Capitol Hill yesterday, was asked by a Republican lawmaker to resign. It is a call he is likely to hear again and again as next year's election campaign heats up.
Earlier in the week, a Republican challenger for a U.S. Senate seat in Connecticut had demanded Geithner quit, lambasting him for being "cozy" with banks bailed out by the federal government. Two other Republicans have requested hearings into Geithner's handling of the bailout of insurer American International Group Inc.

Why Bernanke Isn't Having a Nervous Breakdown
by Robert Wenzel - EconomicPolicyJournal.com
The short answer is that he is too delusional.
WSJ has a detailed report about the inner thinking of various Fed members, here.
Bottom line: The deliberating body of the Federal Reserve doesn't have a clue. It does not appear most of the members understand how Bernanke's new tools work. It does not appear that most members understand the difference between low interest rates and Fed money printing. Further, the confusion is multiple and from many different directions.
But what really caught my eye in the WSJ report was this snippet:

Before the meeting, officials at the Federal Reserve Bank of New York, which manages the Fed's portfolio, had grown concerned, according to people familiar with the matter. The Fed's portfolio of mortgage-backed securities was about to begin shrinking much more rapidly than anticipated, as low mortgage rates led more Americans to refinance their mortgages. That in turn meant the mortgage-backed securities held by the Fed were being paid off.

Call in the Helicopters:
What We Need to Stimulate the Economy
By CHARLES HUGH SMITH - DailyFinance.com
What if the U.S. Treasury and the Federal Reserve stopped trying to stimulate the economy by encouraging more borrowing with quantitative easing -- and instead dropped money into household bank accounts?
In an era of rising concern about massive Federal deficits, such a policy may seem like the wrong idea at the wrong time, but proponents have an interesting argument, which the country should understand without dismissing out of hand.
While the economics jargon can get very heavy in discussions of monetary and fiscal policy, the basic ideas aren't that difficult to understand.

Hard-nosed Fed sends global markets reeling
By Ambrose Evans-Pritchard - Telegraph.co.uk
The global bond markets and the twin havens of the yen and Swiss franc have been flashing warning signs for weeks, tracking leading indicators as they topple like dominoes. They always sniff trouble first.
Wall Street and Western bourses have until now brushed aside worries that recovery in the US, Japan and southern Europe may be stalling - as have commodity markets - betting the lords of finance will come to the rescue with more liquidity if needed.
Equity investors learned this week that they had misjudged the risk of a relapse as fiscal stimulus wears off, and misread the willingness of the US Federal Reserve to respond. Wrongly viewing Ben Bernanke's Fed as a soft touch, they took a fresh blast of quantitative easing for granted before it was agreed.

St Louis Fed Explains Why The Fed Has Cornered Itself
Between Deflation And (Hyper) Inflation
by Tyler Durden - ZeroHedge.com
In its September Monetary Trends letter titled "The Monetary Base and Bank Lending: You Can Lead a Horse to Water..." the St Louis Fed analyzes the phenomenon that has all monetarists up in arms, namely the surge in the monetary base and the very muted increase (and outright alleged drop in the case of the M3) of monetary stock, going back to the core topic at every debate over hyperinflation/deflation: the money multiplier, and its current reading of well below 1. What is the reason for this discrepancy: as the St Louis Fed explains: "The answer centers on the willingness of depository institutions (banks) to lend and the perceived creditworthiness of potential borrowers. A deposit is created when a bank makes a loan. Ordinarily, bank loans-and hence deposits-increase when the Fed adds reserves to the banking system. How ever, despite an increase in reserves of over $1 trillion, total commercial bank loans were some $200 billion lower in May 2010 than in September 2008. Banks added to their holdings of securities, which resulted in a modest increase in deposits and the money stock, but many banks were reluctant to make new loans." And herein lies the rub: if and when the economy ever picks up, and at this point that looks like an event that may well never happen, "Many economists worry that bank lending and monetary growth will eventually surge and, ultimately, cause higher inflation."

Fed divided over policy direction, WSJ reports
By MarketWatch
TEL AVIV (MarketWatch) -- At its Aug. 10 meeting, at least seven of 17 Federal Reserve officials opposed or hesitated over the decision to stimulate the economy by keeping the Fed's securities portfolio from winding down, The Wall Street Journal reported Tuesday.
At issue was whether to reinvest principal payments to the Fed back into the markets.
The Wall Street Journal report said Fed members were divided into two camps.
New York Fed President William Dudley, Boston Fed President Eric Rosengren, San Francisco Fed President Janet Yellen and others were concerned about the economy and "more inclined to act," it said.

Fed Split on Move to Bolster Sluggish Economy
By JON HILSENRATH - WSJ.com
WASHINGTON - The Aug. 10 meeting of top Federal Reserve officials was among the most contentious in Ben Bernanke's four-and-a-half year tenure as central bank chairman.
With the economic outlook unexpectedly darkening, the issue was a seemingly technical one: whether to alter the way the Fed manages its huge portfolio of securities.
But it had big implications: Doing so would plunge the Fed back into the markets and might be a prelude to a future easing of monetary policy, moves that divided the men and women atop the central bank.

* * * * * Important! * * * * *

Indymac Boys Get Sweetheart Deal
Those Indymac boys were given deal by the FDIC, and borrowers were strong-armed. February, 2010.

FDIC Insurance Limits and Indymac Bank Loan Modifications
from September, 2008.

Stocks Drop After Sharp Fall In July Home Sales
NEW YORK (AP) - Stocks are falling after another disappointing report on the housing market renewed worries about the economy.
The Dow Jones industrial average is down 60 points in midday trading Tuesday following news that sales of previously occupied homes fell to their lowest level in 15 years. The National Association of Realtors says sales plunged 27 percent last month to an annual rate of 3.83 million.
Investors seeking refuge from the latest stock swings piled back into Treasurys, sending interest rates lower.

Carts and Horses
Peter Schiff - SilverBearCafe.com
In a CNBC debate last week, former Labor Secretary Robert Reich presented a set of contradictory beliefs that unfortunately reflect the conventional wisdom of modern economists. In a discussion with Wall Street Journal columnist Stephen Moore, Reich correctly and comprehensively listed the reasons why American consumers could spend so lavishly before the crash of 2008 and why they can no longer keep up the pace. But instead of making the logical conclusion that former levels of spending were unsustainable and that spending should now reflect current conditions, he advocated that government take on additional debt so that tapped out consumers can spend like they used to.
To achieve this, Reich called for lowering taxes on working Americans and raising taxes on the rich. He argued that middle-income Americans are more likely to spend additional dollars while the rich are more likely to save and invest. As a "demand-side" economist, Reich made clear that spending is superior to savings and investing as a catalyst for growth.

Corporate America, it's time to spread the wealth
Businesses are sitting on a record hoard of cash, but they're not using it to hire workers or pay existing ones better wages. Broadly distributing the fruits of economic growth is the only way to sustain that growth.
ByMichael Hiltzik - LATimes.com
Corporate America must be in a bad way. Job growth has stagnated, the prospects for hiring, at least in the near term, seem grim, and the polls of top executives sound universally glum.
And yet, operating earnings of companies in the Standard & Poor's 500 index jumped 38.4% in the second quarter compared with a year earlier, according to Thomson Reuters, and companies are sitting on an estimated $1.8 trillion in cash -- by some measures, a record mound of cash.
Somebody's making money in this economy. Unfortunately, it's not the middle class or the working class. And that's our real problem.

The fallacy of cheap home prices and the two income trap
dual income households underscore massive housing inflation.
Nationwide home prices overvalued by 25 percent.
DrHousingBubble.com Blog
Housing inflation has run at an elevated pace since the 1970s and ramped up starting in the 1990s. Yet what masked much of the pain was access to easy credit but also the rise of the two income household. The housing bubble is worse than many expect and probably for the wrong reasons. Many readers make the wrong assumption that because we are largely a two income household nation that home values had to rise simply because of this transition. It was a simple 2 plus 2 calculation. This is wrong and it is more likely that home values grew in the last decade more on the introduction of exotic mortgage products that didn't rely on income measures. There is little debate that many cities in California are still in major housing bubbles. Yet nationwide home values are still overpriced by 25 percent. Let us examine why.

Why nobody wants to buy a house
With government bribe money gone, so is any sane demand
By MarketWatch
CHICAGO (MarketWatch) -- Nobody wants to buy a house. Nobody in their right mind, anyway.
Oh, sure, a lot of gullible first-time buyers got lured into the market over the last 18 months to take advantage of an $8,000 federal tax credit (not realizing how little difference that money will make when the first property-tax bill hits at the same time the roof springs a pesky leak and the city hits you with a special assessment for sidewalk repair). But that tax credit has expired -- and, with it, any semblance of demand for homes.

Home buyers scatter in July after incentives end
BUSINESS FIRST OF COLUMBUS
The expiration of federal tax-credit incentives led Central Ohio home shoppers to tap the brakes in June, but slam on the pedals in July, according to new statistics from the Columbus Board of Realtors.
The board on Tuesday reported sales of 1,483 single-family homes and condominiums last month, down 28 percent from 2,057 a year ago. Home sales dropped 36 percent from June after a modest 4 percent monthly decline from May.

Housing in 'Double-Dip': Economist Zandi
By: Michelle Lodge - Special to CNBC.com
The US housing market is in a double-dip recession, Moody's Analytics chief economist Mark Zandi told CNBC Monday.
"Tomorrow we are going to get an existing home sales number that that I think is going to be very, very weak, closer to 4 million units, which I think would be a new low in this cycle," said Zandi, who is also the author of forthcoming Paying the Price.
"We probably, almost assuredly, will experience more house price declines. By those two criteria, I think that would qualify as a double dip."
Home prices fell 5.1 percent in June to an annualized pace of 5.37 million homes, the weakest since March.

Sales of previously occupied homes plunge
By Dina Elboghdady - WashingtonPost.com
Purchases of previously built single-family homes plunged in July to their lowest level since May 1995 as job fears trumped today's low mortgage interest rates and relatively affordable home prices.
The sales of existing single-family homes, condominiums and townhouses fell to a seasonally adjusted annual rate of 3.83 million, the National Association of Realtors reported Tuesday. That's a 27.2 percent drop from June, about twice as much as analysts surveyed by Bloomberg expected. That's also a 25.5 percent drop from the same time a year ago. The sales of all these housing types combined was the lowest since the group started tracking the numbers in 1999.

Existing-home sales plunge 27.2%
Inventory of unsold homes jumps to 11-year high
By Jeffry Bartash, MarketWatch
WASHINGTON (MarketWatch) -- The sale of existing U.S. homes sank 27.2% in July -- the biggest one-month drop ever -- largely because of the phase-out of a federal tax credit, according to an industry trade group.
The National Association of Realtors said existing-home sales fell to a seasonally adjusted annual rate of 3.83 million in July from 5.26 million the month before. Sales of single-family homes fell to the lowest rate in 15 years.

Diving home sales stoke new worries about economic recovery
U.S. sales fall for the third consecutive month to the lowest rate since 1999, pushing down stocks and fueling fears of a 'double dip' in the housing market.
By Alejandro Lazo, Los Angeles Times
The end of a popular government stimulus program drove home sales in July to their lowest levels in more than a decade, fueling fresh concerns about the economic recovery.
Home sales fell 27.2% nationwide from a month earlier, the National Assn. of Realtors reported. That was a much bigger drop than expected, as the boost evaporated from a now-expired federal tax credit that had been driving sales this spring. The plunge came despite rock-bottom rates on home loans.
Concern over the summer swoon reverberated from Wall Street to the White House. The Dow Jones industrial average briefly slid below the 10,000 benchmark and was down 1.3% on the day.

Existing Home Sales Hit 15-Year Low;
Housing Market Weakens
By: Reuters and AP - CNBC.com
Sales of previously owned U.S. homes dropped more steeply than expected in July to their lowest pace in 15 years, an industry group said Tuesday, implying further loss of momentum in the economic recovery.
The National Association of Realtors said sales dropped a record 27.2 percent from June to an annual rate of 3.83 million units, the lowest level since May 1995. June's sales pace was revised down to a 5.26 million-unit pace.
The record drop in existing U.S. home sales in July showed that the country must still do more to improve the economy, White House spokesman Bill Burton said Tuesday.

Goldman Sachs-Its Class WarFare. Oct 2009
Webster Tarpley talks about how there is 1 million new foreclosure claims as the bailout boyz from Goldman Sachs,JP Morgan Chase,Morgan and Stanley BOA,Wells Fargo are still paying top bonuses to their employees..

Housing Slide in U.S. May Drag Economy Into Recession
By John Gittelsohn and Bob Willis
Aug. 23 (Bloomberg) -- Housing led the U.S. out of seven of the last eight recessions. This time, it may kill the recovery.
Home sales collapsed after a federal tax credit for buyers expired in April. Since then, the manufacturing-led expansion, which began in the second half of 2009, has been waning, with jobless claims rising and factory orders falling.
"If foreclosures continue to mount and depress home prices, that could send the economy back into a recession," said Celia Chen, an economist who tracks the industry for Moody's Analytics Inc. "The housing market and the broader economy are closely intertwined."

States Show Few Gains in Fight Against Unemployment
By: Joseph Pisani - CNBC News Associate
State unemployment rates have shown only minimal improvements, with 18 states and the District of Columbia reporting decreases in July, 14 showing increases and 18 with no change at all, government data released Friday showed.
Just a month before, 39 states and the District of Columbia saw their rates decrease.
Nevada had the highest jobless rate in the nation for the third month in a row, since dethroning Michigan for the top spot in May, according to the report released by the Labor Department.

State tax hikes could go too far
By Ben Rooney
NEW YORK (CNNMoney.com) -- Some U.S. states facing steep budget gaps have resorted to tax policies that could be harmful over the long term, a non-profit research group said Monday.
In a review of 2010 changes in state tax policy, the Tax Foundation said certain states have targeted tax increases on high-income earners, smokers and out-of-state business transactions. These taxes may be politically convenient, but the foundation said that relying too heavily on such sources can lead to problems over the long run.

US Said Preparing New Laws
To Seize Americans Retirement Accounts
Posted by EU Times
First They Destroy Private Healthcare in America - Yes, the socialist Democrats won their first battle to destroy the private healthcare system in the US but the automatic IRA bill now in Congress is their next attack to also control, confiscate and destroy the private retirement system. Ultimately, nationalizing healthcare is designed to create a major new government revenue stream by replacing private health insurance with a nationalized, mandatory, government program and their goal is identical with your retirement plan.
Washington will decide the annual forced healthcare premiums on all Americans with the middle and upper wage earners paying far higher premiums than the subsidized voting constituencies who will be the primary beneficiaries of the program. Their goal is to allow Washington to steal much of the annual health premiums (taxes) for current revenue needs and to bailout and subsidize with your premiums the health programs for the voting blocks of poor and underemployed, illegals, unions and the millions of city, county, state and federal government employees. Eventually there will be no private competition available except for the very wealthy and Washington will constantly increase premiums just as they raise taxes today.

Ron Paul on CNN American Morning 8/24/10:
The NYC Mosque Sideshow

Does Barack Obama want to be re-elected in 2012?
By Toby Harnden - Telegraph.co.uk
Few Americans consider themselves bigger than the presidency but Obama might be one of them. The man in the Oval Office, argues Toby Harnden, may already be preparing for a role as a post-president in a post-American world.
When David Plouffe, President Barack Obama's 2008 campaign manager, wrote recently that his former boss was "not concerned with his re-election", there was predictable scepticism.
After all, it has long been a truism that every politician wants to cling to power and a reality that presidential campaigns are planned years in advance. Pronouncements about not looking at polls and concentrating on getting things done are, moreover, standard fare from poll-driven, election-obsessed politicians and their apparatchiks.

The Disappearing Gulf Oil Plumes Redux
Ronald Bailey | Reason.com
Remember the rosy scenario report by the Obama administration that 75 percent of the oil from the BP oil blowout had disappeared. Then a week ago came a somber report in Science declaring that the crude was still lurking Jaws-like below the surface in giant greasy plumes. This report provoked some policymakers and environmentalists to denounce the Obama administration for making stuff up about dire environmental situation in the Gulf of Mexico.
Now comes another research report in Science that says that previously unknown bacteria just love dining on the plumes with the result that the plumes are now completely undectectable. As Science News reports:
In May, researchers began reporting that the massive jets of crude emanating from BP's damaged Deepwater Horizon well were creating deep, diffuse plumes of oil in the Gulf of Mexico. Since then, chemical oceanographers have been probing the plumes for indirect clues about how quickly native bacteria might be gobbling up the oil.

Red Alert! Attack on the Coasts and Fisheries of Norway!
William B. Fox - SilverBearCafe.com
Dear Fellow Norwegians and Norwegian-Americans:
Contrary to reports that we see in mainstream media that British Petroleum has the "Gulf spill" under control, we see numerous credible reports in alternative media that massive amounts of oil and gas continue to rise from the sea floor at a horrendous rate from over ten locations outside of the main drill hole, which has been badly fractured in many locations beneath the ocean floor.1
We also see many reports of massive clusters of dead fish now washing up on shores all over the East Coast, from Florida to Massachusetts. 2 Many experts fear that a highly toxic stream of contaminated ocean water is now flowing in the Gulf Stream towards Northern Europe, where it could cause severe damage to Norway's fisheries and fjords within about six months if nothing is done. 3 In addition, the 9 Aug 2010 article Special Post - Gulf Stream & North Atlantic Current Dying by Lord Stirling cites concerns by Italian theoretical physicist Dr. Giangluigi Zangari that pollution has already broken the Gulf Loop Current, resulting in a "dramatic weakening in the vorticity of the Gulf Stream and North Atlantic Current, and a reduction in North Atlantic water temperatures of 10C." 4 This in turn means that Ice Age conditions could advance on Norway.

The Gulf Crisis is Not Over
Anne McClintock - SilverBearCafe.com
Slow Violence and the BP Coverups
Three vanishing acts are being played out in the Gulf: the disappearing of the oil from the ocean surface by Corexit, the disappearing of the story by the media blockade, and the disappearing from view of the shadowy private contractors who are making a mint helping BP and the Coast Guard keep a cover on the clean-up. This triple vanishing trick, collectively choreographed by BP and sundry federal agencies, culminated on August 4th in a report released by NOAA that claimed 75% of the oil spill had been captured, burned, evaporated or broken down. The White House hailed the report as something to celebrate. Energy advisor Carol Browne announced: "the vast majority of the oil is gone."
A clamor of outrage immediately rose from the Gulf, as residents refused to dance the crisis-is-over, happy-feet dance. Hundreds of locals furiously insisted that they were still seeing masses of oil on ocean, beaches and marshes, and dead fish, dolphins, sharks, birds and other marine life washing ashore. Then on August 18th scientists from the Universities of Georgia and South Florida produced an open challenge to the White House report, asserting that 70% to 79% of the oil in the Gulf still remained in the water. Charles Hopkinson, a professor of marine science at the University of Georgia declared: "The idea that 75% of the oil is gone and of no concern to the environment is just absolutely incorrect."

A blunt view of Afghan deadline
Does Obama's plan help the enemy?
By Mark Mardell - BBC.com
The man in charge of the United States Marines, who has just returned from a tour of Afghanistan, has said President Obama's plan to start withdrawing troops next summer has given sustenance to the enemy.
General James Conway said that it will be a few years before the time is right to hand over to Afghan forces in some key areas.
The assessment by the Commandant of the Marines, who are fighting in the most critical areas of Afghanistan, is the most blunt so far from a senior military figure.

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Tuesday 08.24.2010

The taxman cometh
By Palash R. Ghosh - IBTimes.com
Prospects for higher taxes in 2011 and beyond will retard the pace of economic recovery in the U.S.
Milton Ezrati, senior economist and market strategist, said that the tax increases both planned (and threatened) by the current administration over the next few years will likely cut GDP growth.
Consider the plethora of tax hikes on the horizon:
The tax cuts initiated by George W. Bush in 2001 and 2003 are scheduled to expire at the end of this year. The President and Congress will probably extend the cuts for all but the two top brackets of wealthier Americans, thereby letting the tax brackets rise from their present levels of 35 percent and 33 percent, respectively, to 39.6 percent and 36 percent.

ObamaCare's Tax on Taxes
WSJ.com - $$
The latest gambit to punish for-profit health insurers.
Lately a lot of Democrats are taking the ObamaCare walk of shame, and not only those whose votes may return them to the labor market this fall. Liberals still think the bill didn't raise taxes enough.
So they've cooked up a virtuoso new scheme. A phalanx of powerful committee Chairmen - including Henry Waxman (House Commerce), Max Baucus (Senate Finance) and Sander Levin (Ways and Means) - want to tax the taxes that the health insurance industry already pays.

The Decline in American Optimism
By Richard Posner
I don't put much weight on public opinion polls that show a drop in Americans' optimism about the economic future of the country. Optimism and pessimism are personality traits that condition people's reaction to uncertainty, but they are also influenced by uncertainty. This was one of Keynes's insights. When a sharp economic downturn creates the kind of uncertainty about economic prospects that we're now observing, people's "animal spirits" (his term for optimism) droop; hoarding increases and entrepreneurship flags. These are rational responses to uncertainty, but they do not predict a nation's future economic performance.

79 Common Sense Reasons For A Gold Standard
By: Toni Straka - Safehaven.com
The world enters the final stage of financial destruction thanks to a one-sided application of John Maynard Keynes' equation because politicians and central bankers did a terrific job in deficit spending since the USA defaulted on its gold obligations in 1971, but never followed Keynes advice to build reserves in surplus years. This is a direct result of a fiat money system that allows to create money at essentially no cost, to quote Fed chair Ben Bernanke from his infamous 2002 speech.
IMHO the heated discussion about a new gold standard will follow philosopher Arthur Schopenhauer's saying: "All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident."

Will The Price Of Gold Reach $5,000?
By: Marvin Clark - iStockAnalyst.com
All the current chatter these days on whether or not to reduce a portfolio's exposure to gold is, to put it bluntly, a short term trader's conversation. A crowded trade, whales exiting a crowded trade, is it deflation or inflation? Gold is the inferior commodity to soft commodities such as wheat; gold's current price elasticity, and more, all sound reasonable.
However, if you are a trend position builder and/or a long term investor of gold, we shall now review other important long term considerations that transactional traders omit from discussions.

Why Gold Is Not In A Bull Market
By: Julian D. W. Phillips - Safehaven.com
What is a 'Bull' market? It is a market in an upward price phase of a market with the expectation that it will be followed by a 'Bear' or downward phase of a market. This mindset is common to all markets. Sayings like, "everything that goes up must come down" is pretty standard and taken as part of life itself, but few examine it to see if it is really true. Why should everything that goes up come down? For some years now gold has been thought of as moving in the opposite direction to the U.S. Dollar. So if gold goes up it must come down must also mean that if the Dollar goes down it must come up? Is that true? The history of currencies in the last few thousand years tell us something quite different. Currencies have gone down and never come up again, just disappeared. Gold has always retained a monetary value. Since the eighties to 1999, gold has gone down and in this century has gone up. So we take issue with the saying, in the light of the history of gold. Even though the 'powers that be' have tried to discredit gold and underlying money, the vast majority of central banks have retained most of their gold because they believed it to be a very valuable reserve asset.

China Ditches US Currency - Are Times Changing?
By: Shae Smith - Safehaven.com
We all know the US flogs its debt to anyone willing to buy it. And up until recently, that's been China.
Very slowly, over the past twelve months China has been lowering its exposure to US treasuries. In fact, in the last twelve months, they've offloaded about USD$100 billion dollars worth.
Some of this has been by simply not purchasing more bonds upon maturity. While some of it has been by turning those US dollars into precious resources. Instead of waiting for bonds to mature, it has used the cash to buy up natural gas stores, investing in oil rigs and even throwing money into companies with large iron ore mines.

How Hyperinflation Will Happen
by Gonzalo Lira
Right now, we are in the middle of deflation. The Global Depression we are experiencing has squeezed both aggregate demand levels and aggregate asset prices as never before. Since the credit crunch of September 2008, the U.S. and world economies have been slowly circling the deflationary drain.
To counter this, the U.S. government has been running massive deficits, as it seeks to prop up aggregate demand levels by way of fiscal "stimulus" spending-the classic Keynesian move, the same old prescription since donkey's ears.
But the stimulus, apart from being slow and inefficient, has simply not been enough to offset the fall in consumer spending.

Hyperinflation is a Fiscal, Not Monetary Phenomenon
By: Jordan Roy-Byrne - Safehaven.com
Months ago we wrote about the true causes of hyperinflation. We proceed to expand upon our views as we disagree with the views put forth by John Mauldin, Mike Shedlock and now Jim Rickards who all focus on velocity and/or bank lending as important causes of hyperinflation.
The reality is that hyperinflation is first and foremost set in motion and driven by a deteriorating fiscal situation. In fact, significant economic weakness and deflation is a precursor to hyperinflation. Too many analysts believe that there has to be some economic demand or some consumption to stimulate inflation or hyperinflation. Printing money to try and stimulate your economy or excessive credit growth is what leads to inflation. Printing money because you are broke and can't service your debts is what leads to hyperinflation.

SEC suspends trading in more stocks this year
By Matt Krantz, USA TODAY
Regulators are stepping up efforts to weed out some of the smallest and most questionable publicly traded companies.
Hoping to prevent investors from being misled by companies with big promises but little financial information, the Securities and Exchange Commission suspended trading in 202 stocks this year, already topping the 183 stocks that were suspended through the end of the third quarter of 2009. The SEC suspended a record 234 companies for all of 2009, a level that will be easily surpassed this year at the current clip. Suspensions are way up from the 183 and 98 in 2008 and 2007, respectively, a USA TODAY analysis of SEC data shows.

Fed Loses Bid for Review of Bailout Disclosure Ruling
By Bob Ivry
Aug. 23 (Bloomberg) -- An appeals court refused to reconsider a decision compelling the Federal Reserve Board to release documents identifying banks that might have failed without the U.S. government bailout.
The full U.S. Court of Appeals in New York, in a docket entry dated Aug. 20, denied a May 4 request by the Fed to review a three-judge panel's unanimous March 19 decision requiring the agency to release records of the unprecedented $2 trillion U.S. loan program begun primarily after the 2008 collapse of Bear Stearns Cos.

Lunch with the FT: Adam Fergusson
By Jonathan Ford - FT.com
As befits a man who has written an acclaimed book about money and prices, Adam Fergusson starts our encounter by eyeing the menu beadily and asking who will be paying the bill. "Milton Friedman said the most efficient way of spending money is to spend your own, and the least efficient way is to spend other people's," he says. "If you go out to lunch and have to pay your own bill, you have what you want and can afford. If someone else is paying, you may as well have the lobster."

BoA sees US double-dip danger from 'fiscal chicken'
By Ambrose Evans-Pritchard - Telegraph.co.uk
Bank of America has accused the Democrats and Republicans in Congress of endangering the US economy in a game "fiscal chicken", risking a grave policy error by tightening too early.
Ethan Harris, the bank's chief North American economist, said early data for August suggest that "an already weak recovery is getting weaker" with a rising risk of a relapse into recession, yet the two parties seemed determined to outbid each other with austerity measures.
"Politicians are clamouring for quick action, not to stimulate a dangerously weak economy, but to bring down the budget deficit. We strongly support efforts to bring down the deficit, but only once the economy is on a healthy growth trajectory," Mr Harris said.

Global Shivers Mean That Nobody Escapes
the Worsening Economic Cold
By Irwin Stelzer - WSJ.com
The U.S. economy grows smartly-at an annual rate of 5.6% in the last quarter of last year-but when the final figures are in America will have recorded a growth rate of less than 2% in the most recent quarter. Meanwhile, in that recent quarter Germany grew at an annual rate of close to 9%, and powered the euro-zone annual growth rate to almost 4%. But in part because America has now slowed, the Bundesbank and other experts are forecasting much lower growth rates in the second half of the year. In short, America spurts, Europe slows, so America slows; Europe spurts, America slows, so Europe slows. Coincidence? Not likely.

CFR: China Poised to Shock the Oil Market
And Its Possible Consequences for Hyperinflation
I found this paper published by the Council on Foreign Relations to be a plausible argument in favor of the exhaustion of cheap oil, also known as Peak Oil. This growth in Chinese oil consumption into the 'knee of the curve' given its growing per capital income could very well cause an oil shock as the title of the paper suggests. As you may recall it was an oil shock that triggered the stagflation of the 1970's, a black swan event if there ever was one.

Stimulus round 2 waiting in the wings: PineBridge
By Hao Li - IBTimes.com
A second round of stimulus is waiting in the wings, ready to be deployed if the economy further deteriorates, said PineBridge Investments, an investment adviser with $78 billion in assets under management.
If the Chinese economy does not glide into the "soft landing" engineered by their regulators, PineBridge believes their government will resort to fiscal stimulus near the end of 2010. For the U.S., regulators are gearing up for another round of quantitative easing if the economy worsens, said PineBridge.

Fed's Hoenig Says Big Banks Benefit From Safety Net
By Steve Matthews
Aug. 23 (Bloomberg) -- The largest U.S. banks have an implied government safety net that gives them a lower cost of capital compared to community banks even after a congressional overhaul of banking regulation, Kansas City Federal Reserve President Thomas Hoenig said.
"Despite the provisions of the Dodd-Frank Act to end too- big-to-fail, community banks will continue to face higher costs of capital and deposits until investors are convinced it has ended," Hoenig said today in testimony to a congressional hearing in Overland Park, Kansas.

Investors Shake Up Funds With Record Bond Love Affair
By Charles Stein
Aug. 23 (Bloomberg) -- Retail investors in the U.S., burned by two market crashes in a decade, have shunned stocks for the longest stretch in more than 23 years, upsetting the balance of power in the $10.5 trillion mutual-fund industry.
Bond funds attracted more money than their equity counterparts in 30 straight months through June, according to the Investment Company Institute, a Washington-based trade group. Preliminary data show the trend continued in July, matching the streak posted by bonds from 1984 through 1987.

Greek Banks Pressured to Merge as Economic Slump Hurts Profits
By Niklas Magnusson
Aug. 24 (Bloomberg) -- Greek banks are under growing political pressure to merge as second-quarter earnings probably slumped on rising loan losses and worsening asset quality in the debt-burdened country.
National Bank of Greece SA, EFG Eurobank Ergasias SA, Alpha Bank SA and Piraeus Bank SA, which will report results within the next week, have been called upon to consider partnerships by Greek Finance Minister George Papaconstantinou and Bank of Greece Governor George Provopoulos. Profits at the lenders probably fell more than 60 percent, according to analysts' estimate.

U.S. Judges Sound Off on Bank Settlements
By BINYAMIN APPELBAUM - NYTimes.com
WASHINGTON - Everything was rolling along traditional lines. A bank broke the rules. The government found out. The company agreed to pay a fine and improve its behavior.
And then the judge assigned to approve the deal blew his top.
In a scene that is becoming increasingly common, Judge Emmet G. Sullivan of Federal District Court chewed out federal prosecutors at a hearing in Washington last week for a proposed settlement with Barclays.
"Why isn't the government getting tough with banks?" he asked.

Now That's Rich
By PAUL KRUGMAN - NYTimes.com
We need to pinch pennies these days. Don't you know we have a budget deficit? For months that has been the word from Republicans and conservative Democrats, who have rejected every suggestion that we do more to avoid deep cuts in public services and help the ailing economy.
But these same politicians are eager to cut checks averaging $3 million each to the richest 120,000 people in the country.

Paul Craig Roberts: America is Truly being Destroyed by Design - 1

Paul Craig Roberts: America is Truly being Destroyed by Design - 2

Paul Craig Roberts: America is Truly being Destroyed by Design - 3

Commercial foreclosures revisit Chicago Loop
Office tower at 500 W. Monroe flirts with foreclosure again
By: Eddie Baeb and Thomas A. Corfma - ChicagoBusiness.com
The owner of a downtown skyscraper that managed to stave off foreclosure last year is on the hot seat again as the commercial real estate market continues to sag.
A Georgia firm that holds two junior mortgages on the 46-story tower at 500 W. Monroe St. says the building's loans went unpaid when they came due this month and that the company may foreclose and take control of the property.

How States Hide Their Budget Deficits
By John Frisby - Lux Libertas
The SEC's charges against New Jersey for misleading investors should warn other states against sweeping the truth under the rug.
Article By STEVE MALANGA
In April, the New York State Comptroller, Thomas DiNapoli, issued a damning report on the Empire State's financial practices. Albany's budgets, he observed, increasingly employ "fiscal manipulations" to present a "distorted view of the State's finances." Money shuffled among accounts to hide deficits, loans made by the state to itself, and other maneuvers Mr. DiNapoli called a "fiscal shell game" are meant to "mask the true magnitude of the State's structural budget deficit."
The comptroller's report produced yawns. Last week, however, the Securities and Exchange Commission (SEC) filed fraud charges against New Jersey for misrepresenting its financial obligations, particularly its pension obligations, and misleading investors in its bonds. New York - and many other states - had better sit up and take notice.

Americans Using Their Rainy Day Savings to Live
BY CHUCK - RebelTraders.net
Recently I commented on the outflow of money from mutual funds and the increase in 401K hardship withdraws.
Today the New York Times carries the story further by stating that investors have simply given up on the stock market. While this may indeed be true that investors simply don’t trust it anymore, and who could blame them, I contend that there is still a significant percentage of those pulling money from stocks who need the funds to live.
Investors withdrew a staggering $33.12 billion from domestic stock market mutual funds in the first seven months of this year, according to the Investment Company Institute, the mutual fund industry trade group. Now many are choosing investments they deem safer, like bonds.

How low can we fall this fall?
TheAutomaticEarth.com
. . . . A society cannot buy its way out of a debt-driven depression by taking on more debt, or at least not when a number of vital necessities are entirely lacking. When there's no (rise in) productive capacity, or in consumer spending, and when exports can't go up substantially, in other words, when every penny written off has to be replaced by another penny borrowed just to stand still, it doesn't really matter what all sorts of statistics seem to indicate, that society is no better off for it, and can thus not be said to be out of its recession.

Housing's Second Leg Down
by PAUL JACKSON - HousingWire.com
Home prices have fallen 34% from their peak in the middle of 2006, according to Standard & Poor's HPI data - but is that enough? Or is there further to go? How much further could we fall?
It's worth noting that the question of what happens next with home prices isn't merely an academic exercise. With CoreLogic estimating that more than 11.2 million U.S. borrowers were underwater on their mortgages at the end of the first quarter, the direction of U.S. home price trends over the next few years will have a direct impact on bank and related financial balance sheets the world over.

Housing Slide in U.S. May Drag Economy Into Recession
By John Gittelsohn and Bob Willis
Aug. 23 (Bloomberg) -- Housing led the U.S. out of seven of the last eight recessions. This time, it may kill the recovery.
Home sales collapsed after a federal tax credit for buyers expired in April. Since then, the manufacturing-led expansion, which began in the second half of 2009, has been waning, with jobless claims rising and factory orders falling.
"If foreclosures continue to mount and depress home prices, that could send the economy back into a recession," said Celia Chen, an economist who tracks the industry for Moody's Analytics Inc. "The housing market and the broader economy are closely intertwined."

The Costs of Homeownership Drive First-time Buyers Away
by CHRISTINE RICCIARDI - HousingWire.com
The costs of owning a home can substantially outweigh the benefits because of issues such minimal home equity retention and an owners desire to "flip" a home on the market quickly, researchers Wenli Li and Fang Yang said in their report American Dream or American Obsession? The Economic Benefits and Costs of Homeownership, published Friday by the Federal Reserve Bank of Philadelphia.
"One thing that is certain," the two analysts said, "is that homeownership is not for everyone, and thus, based on economic benefits, the case for trying to achieve a nation of homeowners needs to be rethought."

Let the Housing Market Normalize!
By: Ron Paul - Safehaven.com
Recently there have been some encouraging signs that Congress is finally willing to admit what should have been evident two years ago. Even after a $150 billion bailout, Fannie Mae and Freddie Mac are still bankrupt and should be abolished. Indeed Rep. Barney Frank, a longtime champion of Fannie and Freddie has made a few statements alluding to this and I have signed on to a letter asking him to clarify his remarks and hold hearings on this topic. There seems to be a growing consensus in favor of abolishing Fannie and Freddie. This is the good news.

Mortgage Fraud Is Rising, With a Twist
Adopting to Tighter Rules After Collapse,
Scammers Turn to More Complex Plots
By ROBBIE WHELAN - WSJ.com
New data suggests that mortgage fraud - which got tougher to pull off after the collapse of the U.S. real estate market - is returning in a big way.
Data prepared for The Wall Street Journal by research firm CoreLogic, examining about seven million home loans made by hundreds of lenders, show that losses from mortgage fraud - ranging from falsified credit reports to identity theft - rose 17% last year after declining 57% in the two years after its 2006 peak.
In 2009, $14 billion in loans, or about 0.7% of all mortgage loans made in the U.S., were originated with fraudulent application data.

Oregon loses 10,600 jobs in last year
PORTLAND BUSINESS JOURNAL
Oregon has lost 10,600 jobs in the past year, ranking No. 42 among all 50 states and the District of Columbia for job retention, according to the latest figures from the U.S. Bureau of Labor Statistics.
Thirty-one states increased their nonfarm employment totals between July 2009 and July 2010. Nineteen states - including Oregon - suffered declines, while Wyoming was unchanged.
Texas enjoyed the biggest increase in raw numbers, adding 134,600 nonfarm jobs during the past year. The runners-up were Indiana (up 47,600 jobs), Massachusetts (up 36,600) and Minnesota (up 23,200).
California suffered the biggest decline and lost 103,900 jobs in the past year.

Will the Next Generation be Better off Than Their Parents' Generation?
By Gary Becker
The great majority of parents would like to see their children become better off economically than they are, and that hope would be even more common among the children. Yet, polls for a while have suggested that neither the majority of children nor parents in the United States are confident that this progress will happen. Despite frequent recent commentary on these polls, little systematic analysis has been presented of what determines whether the average child will be better off than the average parent, and why pessimism about such progress has apparently grown in the US.

Credit-Card Rates Climb
Levels Hit Nine-Year High as New Rules Limiting Penalty Fees Help Fuel Rise By RUTH SIMON - WSJ.com - (free)
Interest rates continue to tumble for the U.S. Treasury, companies and home buyers alike. But for a large portion of 381 million U.S. credit-card accounts, borrowing rates have been moving only one way: up.
And average rates are likely to climb further in the near future.
New credit-card rules that took effect Sunday limit banks' ability to charge penalty fees. They come on top of rule changes earlier this year restricting issuers' ability to adjust rates on the fly. Issuers responded by pushing card rates to their highest level in nine years.

President: poor jobs numbers stem from inaction in Senate
By Joseph Picard - IBTimes.com
President Obama reacted to the grim news on job loss by calling on Congress to pass the Small Business Jobs Bill.
"In the final few months of last year, small businesses with fewer than 50 employees accounted for more than 60 percent of the job losses in America," Obama said. "These are the businesses that usually create most of the jobs in this country."
The president said that "if we want this economy to create more jobs more quickly, we need to help them."

Americans confused about healthcare reform
By Julie Steenhuysen - Reuters.com
(Reuters) - Julia Wood, a 51-year-old mother of 12 from Chicago's East side, has some health insurance through a state program -- but is so worried she may lose it she asks not to give her real name.
Wood's husband, a plumbing contractor, watched his business dry up in 2008 with the mortgage crisis.
"The economy hit us," said Wood in an interview at the not-for-profit Chicago Family Health Center.
Like millions of Americans, she is waiting for healthcare reform legislation signed into law by President Barack Obama in March to take effect. But like millions of Americans, she is not sure what it will do for her.

SB1070 critics boycott Budweiser, Hensley
PHOENIX BUSINESS JOURNAL - BY Mike Sunnucks
A Hispanic group opposed to Arizona's Senate Bill 1070 immigration measure has launched a boycott of Budweiser beer and the Phoenix-based Anheuser-Busch distributorship headed by Cindy Hensley McCain.
Hensley McCain is the chairwoman of the Hensley & Co. distributorship and the wife of U.S. Sen. John McCain, R-Ariz.
Somos America said today it wants consumers to boycott Budweiser beer until Hensley denounces SB 1070. The law has police determine the immigration status of those they have already detained and whom they suspect are illegally in the U.S.

Obama's Islamic agenda
He embraces the Muslim world and turns his back on us
By Jeffrey T. Kuhner - The Washington Times
President Obama has revealed his true nature. After 20 months in the Oval Office, he still remained a largely unknown figure. A picture is coming into focus now, and it should trouble all Americans. It is widely known that Mr. Obama is a post-national progressive. Yet he is also a cultural Muslim who is promoting an anti-American, pro-Islamic agenda. This is the real meaning of his warm - and completely needless - embrace of the Ground Zero Mosque.
At an Iftar dinner celebrating Ramadan at the White House, Mr. Obama told Muslim-Americans that he supports the building of an Islamic community center and mosque just two blocks away from where the Twin Towers were destroyed and nearly 3,000 Americans were murdered on Sept. 11, 2001. He later tried to back away from those comments. Mr. Obama said he was defending the right of religious freedom but not the "wisdom" of erecting the mosque.

Feinberg Says Spill Victims May Be Able to Sue Some Companies
By Jim Snyder
Aug. 23 (Bloomberg) -- Kenneth Feinberg, who today will start drawing from a $20 billion escrow fund for Gulf oil spill victims, hasn't decided whether they must waive their right to sue companies involved if they accept final reimbursement.
"The question of whether or not a final payment will require a claimant to release one defendant, BP Plc, or all defendants, has not yet been resolved by me," Feinberg said yesterday in a telephone press conference with reporters.

Germany to roll out ID cards with embedded RFID
International Business Times
The production of the RFID chips, an integral element of the new generation of German identity cards, has started after the government gave a 10 year contract to the chipmaker NXP in the Netherlands. Citizens will receive the mandatory new ID cards from the first of November.
The new ID card will contain all personal data on the security chip that can be accessed over a wireless connection.
The new card allows German authorities to identify people with speed and accuracy, the government said. These authorities include the police, customs and tax authorities and of course the local registration and passport granting authorities.

Is Tony Robbins Right About The Coming Economic Collapse?
By Michael Snyder - DailyMarkets.com
It seems like almost everyone is warning of a coming economic collapse these days. Do you remember Tony Robbins? He is probably the world's best known "motivational speaker" and his infomercials dominated late night television during the 80s and 90s. He was always urging all of us to "unleash the power within" and to take charge of our lives. Well guess what? Now Tony Robbins is warning that an economic collapse is coming. In fact, he has issued a special video warning about what he believes is about to happen. Considering the incredible connections that he has at the highest levels of the financial world, it makes a lot of sense to consider what he is trying to warn us about. Robbins says that a "major retracement" is coming to financial markets and that the coming collapse is going to be a "painful process" as we go through it.

Tony Robbins Economic Warning 1-2

Tony Robbins Economic Warning 2-2

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Monday 08.23.2010

Something smells (STINKS) in Chicago, at the ShoreBank . . .
Read articles two, three, and four VERY CAREFULLY.

ShoreBank, Seven Others Shuttered as 2010 Failures Reach 118
By Dakin Campbell and James Sterngold
Aug. 21 (Bloomberg) -- ShoreBank Corp., the Chicago lender operating under a Federal Deposit Insurance Corp. cease-and- desist order for 13 months, and seven other banks were shut by regulators as 2010 bank failures climbed to 118.
ShoreBank's 15 branches, including those in Chicago, Cleveland and Detroit, will open as Urban Partnership Bank, according to statements from the FDIC.
"The good news is that the bank, under this new management, will still be there and serving the South Side community," said Dory Rand, referring to Urban Partnership's William Farrow. Rand is president of the Chicago-based Woodstock Institute, a non-profit that studies community lending."They have made the South Side a decent place to live and work and do business."

Obama's Renewable Energy and Climate Change Agenda
Karl W.Miller - fool.com
This is an interesting story put together from various articles and TV shows by the British Times paper. It shows what Obama and his friends are really all about. It's not hope and change, it is money.
I warn you, the first part is a little boring, but stick with it. The second part connects all the dots for you (it will open your eyes). The end explains how Obama and all his cronies will end up as multi-billionaires. (It's definitely worth the read. You will not be disappointed).
A small bank in Chicago called SHORE BANK almost went bankrupt during the recession. The bank made a profit on its foreign micro-loans (see below) but had lost money in sub-prime mortgages in the US . It was facing likely closure by federal regulators. However, because the bank's executives were well connected with members of the Obama Administration, a private rescue bailout was arranged. The bank's employees had donated money to Obama's Senate campaign. In other words, Shore Bank was too politically connected to be allowed to go under.

The shady ShoreBank bailout
By Michelle Malkin
"No more bailouts, no more greed, how many profits do you need?"
That’s been a signature chant of community organizers and Big Labor thugs who have stormed bank offices and financial executives’ private homes decrying corporate welfare over the past several months. But now that the federal government and a coalition of big banking interests are poised to bail out a crony Chicago bank with longtime ties to the Obama administration, Saul Alinsky's avenging angels are nowhere to be found.
ShoreBank is a Windy City investment bank with all the right (or, rather, left) ties. Its stated progressive mission isn’t merely to make good lending decisions, but to engage in Barack Obama-esque social engineering to "create economic equity and a healthy environment." The ShoreBank corporate slogan: "Let's change the world."

Feds Looking into ShoreBank Connections
By Charlie Gasparino | FOXBusiness - Aug 4, 2010
As if ShoreBank doesn't have enough problems, the financially troubled but politically connected Chicago-based community lender is now facing a federal investigation into whether political pressure was applied to force several major Wall Street firms to bail out the bank before it was liquidated by banking regulators, FOX Business has learned.
Neil Barofsky, the Special Inspector General for the Troubled Asset Relief Program, or TARP, which has agreed to earmark $75 million to help ShoreBank survive, has now bowed to pressure from Congressional Republicans and has agreed to investigate charges that key officials in the Obama White House, as well as FDIC chief Sheila Bair, pressured Wall Street firms to donate money to keep ShoreBank alive.

Regulators shut down big Chicago bank, seven others
WASHINGTON (AP) - Regulators on Friday shut down a big community bank based in Chicago that has been known for its social activism but racked by financial troubles in recent months. A consortium funded by several of the biggest U.S. financial firms is buying its assets and pledging to operate the new bank by the same principles.
The Federal Deposit Insurance Corp. took over ShoreBank, with $2.16 billion in assets and $1.54 billion in deposits. Urban Partnership Bank, the newly chartered financial institution, agreed to assume ShoreBank's deposits and nearly all its assets.
The FDIC also seized seven other banks Friday, bringing to 118 the number of U.S. bank failures this year amid the recession and mounting loan defaults.

OneCalifornia Bank buys Shorebank Pacific
PORTLAND BUSINESS JOURNAL
ShoreBank Pacific will be acquired by OneCalifornia Bank.
ShoreBank, a community bank based in Ilwaco,Wash., employs 17 people and has about $80 million in assets. Its largest office is in downtown Portland.
OneCalifornia and ShoreBank announced the stock purchase agreement Saturday evening. Terms of the transaction were not disclosed.

Little Timmy, the Goldman boy after all
At Treasury, Geithner Struggles to Escape a Past He Never Had
By JACKIE CALMES - NYTimes.com
WASHINGTON - Timothy F. Geithner has been misidentified as a former Wall Street insider from Goldman Sachs so many times since he became the Treasury secretary that he and his advisers had taken to joking about it. Then the joke backfired.
Earlier this month, Mr. Geithner had breakfast in Manhattan with Mayor Michael R. Bloomberg and Robert Steel, a deputy mayor and former Treasury official in the Bush administration who had previously worked at Goldman. Facetiously, a Geithner aide said Mr. Steel and Mr. Geithner knew each other from the investment bank.
Later that day at a public event, the mayor in all seriousness referred to Mr. Steel and Mr. Geithner, and added, "They both worked at Goldman." Oops.

Gerald Celente On the Edge with Max Keiser - 20 August 2010

America no longer needs Chinese money, for now
By Ambrose Evans-Pritchard - Telegraph.co.uk
As the Sino-American showdown in the South China and Yellow Seas escalates into the gravest superpower clash since the Cold War, the United States cannot wisely rely on China to help fund its budget deficit for an
The cacophony of voices in Beijing questioning or mocking the credit-worthiness of the US is now deafening, from premier Wen Jiabao on down. The results are in any case manifest: US Treasury data show that China has cut its holdings of Treasury debt by roughly $100bn (£65bn) over the past year to $844bn.
ZeroHedge reports that net purchases by the big three of China, Japan, and the UK (Mid-East petro-dollars) have been sliding for two years. In August they bought the least amount of US debt this year.

Wall Street debates prospect of bond bubble
By Adam Shell, USA TODAY
NEW YORK - Is a bubble brewing in the normally sedate U.S. government bond market?
That's the big debate raging on Wall Street. Heavy buying of 10-year Treasury notes by investors in search of a safe place to park cash, as well as higher yields than available on certificates of deposit, is pushing prices of government-issued debt sharply higher - and knocking yields down to levels last seen 17 months ago in the depths of the financial crisis.
In early April, the 10-year note yielded nearly 4%. On Friday, it was 2.62%, and last week, it hit its lowest yield since March 2009. Its all-time low yield was 2.06% in December 2008, three months after the collapse of Lehman Bros. nearly sparked a global financial meltdown.

Greek crisis refuses to go away
By Ambrose Evans-Pritchard - Telegraph.co.uk
The European Commission has approved the next €9bn (£7.4bn) tranche of loans for Greece but the underlying economy continues to deteriorate as Greek banks suffer a record loss of deposits and output contracts at a quickening pace.
A report by HSBC said banks had lost 8pc of their entire deposit base in the five months to May. "The Greek market has never, since the first data in 2001, experienced such attrition," said banking analyst Joanna Telioudi.
While some withdrawals point to capital flight by wealthy Greeks, it is clear that households and companies are running down savings to make ends meet. The Athens Chamber of Commerce warned yesterday that its members are in "dire straits", with a majority facing a liquidity threat.

Ratio Analyses Suggest Gold and Silver Will Go MUCH Higher!
By: Lorimer Wilson - GoldSeek.com

1. Dow/Gold Ratio Suggests Possible Future $10,400 Gold!
2. Gold/S&P 500 Ratio Suggests Possible Future $6,000 Gold
3. Gold/Silver Ratio Suggests Future Price for Silver Somewhere Between $75 and $650
4. World Gold Mining Index/Gold Ratio Suggests Much Higher Prices for Gold and Silver Mining Shares
5. Gold/Oil Ratio Suggests Possible Future Prices for Gold and Oil in Excess of $3,150 and $250 Respectively

Ron Paul: Gold is Money!
The Dollar's Value is Destined to Go Down

The Best Gold Interview of 2010
Jeff Clark, Casey's Gold & Resource Report
Much of what passes for "insider" information these days is often conspiracy-edged or largely conjecture. True inside information is actually hard to come by. So what follows is the refreshingly candid and uncut version of my talk with a first-hand participant in the murky and little-understood world of gold bullion, mints, and bullion dealers.
Customarily, when considering a company for a potential recommendation, I hold a series of discussions with management. It was during one of these vetting procedures that I spoke with Andy Schectman of Miles Franklin - and heard some disturbing reports about supply that every investor should know. Andy is a bullion seller, so you're welcome to take his comments with a grain of salt. On the other hand, what he sees week after week and what he hears from his high-level industry contacts might just make you pull back on that salt shaker and re-inventory the number of ounces you own...

Silver Velocity- The Coming Bullet
Money can lose its value through excessive abundance, if so much silver is coined as to heighten people's demand for silver bullion. For in this way the coinage's estimation vanishes when it cannot buy as much silver as the money itself contains... The solution is to mint no more coinage until it recovers its par value -- Copernicus
Silver Velocity to rise
Our Hinde Silver Trend model has reached a significant low that usually precedes a dynamic move. This move can be lower or higher but our other technical indicators signal a move higher is the most likely scenario.

Peter Schiff - Dollar, CBO, Reich, Freddie & Fannie, Refis

Why Quantitative Easing is Likely to Trigger
a Collapse of the U.S. Dollar
John P. Hussman, Ph.D. - HussmanFunds.com
A week ago, the Federal Reserve initiated a new program of "quantitative easing" (QE), with the Fed purchasing U.S. Treasury securities and paying for those securities by creating billions of dollars in new monetary base. Treasury bond prices surged on the action. With the U.S. economy predictably weakening, this second round of quantitative easing appears likely to continue. Unfortunately, the unintended side effect of this policy shift is likely to be an abrupt collapse in the foreign exchange value of the U.S. dollar.

What Problems Lie Ahead for the U.S. Dollar?
By: Julian D. W. Phillips - GoldSeek.com
The recent history of the Dollar
China is the largest holder of the U.S. Dollar in its foreign exchange reserves at $2.45 + trillion. This is an impossible number to trade on foreign exchanges. So they're stuck with them until they can spend them. But, as long as the U.S. Dollar is the world's sole reserve currency, these reserves are useful to buy any asset in any country. It is vital that they retain their buying power. Buying power is defined by its exchange rate value and inside the U.S. relates to the inflation rate. A prime task of the Federal Reserve is to maintain price stability, i.e. buying power stability. So when China expressed concern over the value of the Dollar [and its buying power], we all became concerned. There are many reasons to be concerned about the future of the Dollar. We shall look at some of these in this article.

Inflation, not deflation, Mr. Bernanke
World divides into ice-cold and red-hot economies
By Andy Xie
BEIJING (Caixin Online) -- In the wake of a barrage of bad economic data, the yield on two-year U.S. Treasury notes has tumbled to 0.5% and the 10-year note to 2.8%, almost reaching the levels after Lehman's collapse. Pundits in the U.S. and other Western countries are talking about deflation again.
The decline in the consumer price index for the past three months gives this view ammunition. The Fed is coming under pressure to resume quantitative easing (QE). In anticipation of the Fed resuming QE -- nicknamed "QE 2" -- the dollar has declined quickly by 10% from its recent high. Both the Treasury and currency markets have already priced in "QE 2."

The Economy is in Big Trouble
By MIKE WHITNEY - CounterPunch.org
Imagine the reaction at the White House when the Department of Labor released its weekly unemployment figures on Thursday. Jobless claims rose by 12,000 to 500,000 in the second week of August. There's been no improvement in the jobs market in 9 months and now unemployment is edging upwards again. This wasn't supposed to happen. The Obama administration had bet everything that the economy had turned the corner and would gradually get better. Many economists saw less than a 10 per cent chance that the economy would tip back into recession. After all, double dip recessions are "extremely rare". Now more people are losing their jobs and Team Obama is caught in the headlights. There is no back-up plan, no Plan B. The Democrats will face the midterms with no stimulus to create new jobs and with an economy that is steadily deteriorating. It's going to be a massacre and they know it.

It's doom and gloom all over again
Survey sees fear trumping greed in the market
By Howard Gold
NEW YORK (MarketWatch) -- Investors are scared--really, really scared.
That's what our latest MoneyShow.com Investors' Sentiment indicator tells us, in big, bold, red letters:
HELP!
Our most recent survey of the active, mainly self-directed investors who use MoneyShow.com showed the highest bearish ratings we've ever seen--far greater than back in February 2009, just before the market bottomed. Read MoneyShow's "Investors Aren't Believers."

Cost of this time down: Stagflation
Bubbles burst, and no amount of clever labels can change that fact. Recovery is going to take a while, and we can expect low growth and inflation while we wait.
By Bill Fleckenstein - MSN Money
Gauging the mood of the market over recent weeks, the dominant sentiments seem to be uncertainty and angst. Certainly there are a number of possible explanations: a weak economy, the ugly employment picture and deflation worries, to name a few.
But it was the lead editorial in the Aug. 12 New York Times, headlined, "When the Fed speaks," that I think most aptly put its finger on the recent bout of fear and unease.

And Now We're Headed For The GREATEST Depression,
Says Gerald Celente
by Henry Blodget - TechTicker
The fake "recovery" was nice while it lasted, says famous apocalyptic forecaster Gerald Celente, founder of the Trends Research Institute. But now the fun's over, and we're headed for what Celente describes as the "Greatest Depression."
Specifically, the always startling Celente says the country is headed for rising unemployment, poverty, and violent class warfare as the government efforts to keep the economy going begin to fail.

Abercrombie & Fitch to close 110 stores by 2011
SAN FRANCISCO BUSINESS TIMES - BY Sarah Duxbury
Abercrombie & Fitch said it would close up to 110 stores over the next 18 months.
Most closures will come through expiring leases, and will affect the Abercrombie Kids and Abercrombie and Fitch brands. The Ohio-based company said that it will close 60 U.S. stores over 2010 and an additional 50 U.S. stores in 2011.
Abercrombie currently operates 1,098 stores under the Abercrombie & Fitch, Abercrombie Kids, Hollister and Gilly Hicks brands.

Nevada unemployment grows in July
Some areas of Nevada economy are showing signs of stability
By JENNIFER ROBISON - LAS VEGAS REVIEW-JOURNAL
If you're waiting for an end to Nevada's 16-month string of record unemployment, well, hunker down and dig in.
Experts say it'll be at least half a year before the hiring picture stabilizes, and the Silver State could easily see jobless gains through the end of 2010.
"It really comes back to consumers," said Jered McDonald, an economist with the state Department of Employment, Training and Rehabilitation. "As long as consumers worry about maintaining a job and taking pay cuts, they're just not going to spend on a trip to Las Vegas, and until those folks can start coming back in greater numbers, we're probably going to remain on a negative economic trend."

Cochrane Sees U.S. Jobless Rate Exceeding 10 Percent

Fascism, American Style:
'Too Big to Fail' Is Killing the Middle Class, Celente Says
by Peter Gorenstein - TechTicker
August has been a hot bed of merger & acquisition activity, including:

• Intel to buy McAfee for $7.7 billion
• Mining giant BHP Billiton wants to takeover agricultural goliath Potash for $40 billion.
• Dell to buy 3PAR for about $1.2 billion in cash
• First Niagara Financial Group agreed to buy Connecticut's

NewAlliance Bancshares Inc. for about $1.5 billion in cash and stock.
M&A activity is generally viewed as a good sign for the market and economy.
To the contrary, says Gerald Celente, director of the Trends Research Institute. "This country went from a nation of Main Street, mom and pop businesses to Wall Street and 'too big to fails'," he tells Tech Ticker in this clip. ("Not only were they 'too big to fail,' they were 'too big to jail'," he says of Wall Street execs.)

This Is Why There Are No Jobs in America
By: DailyWealth - MarketOracle.co.uk
Porter Stansberry writes: I'd like to make you a business offer.
Seriously. This is a real offer. In fact, you really can't turn me down, as you'll come to understand in a moment...
Here's the deal. You're going to start a business or expand the one you've got now. It doesn't really matter what you do or what you're going to do. I'll partner with you no matter what business you're in - as long as it's legal.
But I can't give you any capital - you have to come up with that on your own. I won't give you any labor - that's definitely up to you. What I will do, however, is demand you follow all sorts of rules about what products and services you can offer, how much (and how often) you pay your employees, and where and when you're allowed to operate your business. That's my role in the affair: to tell you what to do. Seriously. This is a real offer. In fact, you really can't turn me down, as you'll come to understand in a moment...

U.S. Mortgage Relief Effort Is Falling Short of Its Goal
By DAVID STREITFELD - NYTimes.com
The Obama administration's mortgage relief program, originally intended to shield three million households from foreclosure, now looks as if it will permanently help as few as one-sixth of that number.
While millions say they need help avoiding foreclosure and many struggling households applied, data released Friday showed the dropout rate from the Making Home Affordable Program was very high: 96,000 trial modifications were canceled by lenders in July. The number of canceled trials now exceeds 616,000.

Post-Mortgage Meltdown, Where Do We Go Now?
NPR.org
For more than 20 years, the mantra in Washington has been "more, not less" when it comes to Fannie Mae, Freddie Mac and the expansion of homeownership.
But in light of the financial crisis and Fannie and Freddie's near-collapse, policy leaders are also rethinking the government's role - and many Americans are starting to question whether homeownership is the only path to the American Dream.
Fannie and Freddie function by buying, bundling and then stamping a government guarantee on mortgages. Then they sell them to investors. It keeps the banks happy because it keeps capital flowing, and it keeps consumers happy because it makes low, fixed-rate mortgages possible.

Rense and Celente prepare for the worst

Mortgage Fraud Is Rising, With a Twist
Adopting to Tighter Rules After Collapse, Scammers Turn to More Complex Plots
By ROBBIE WHELAN
New data suggests that mortgage fraud - which got tougher to pull off after the collapse of the U.S. real estate market - is returning in a big way.
Data prepared for The Wall Street Journal by research firm CoreLogic, examining about seven million home loans made by hundreds of lenders, show that losses from mortgage fraud-ranging from falsified credit reports to identity theft - rose 17% last year after declining 57% in the two years after its 2006 peak.
In 2009, $14 billion in loans, or about 0.7% of all mortgage loans made in the U.S., were originated with fraudulent application data.

Housing Diagnosis: Still Weak
By DAVID REILLY - WSJ.com - $$
Talk of mortgage-market reform has started percolating in Washington. But housing numbers this week are likely to reinforce the notion that the market is still far too weak for radical surgery.
Existing-home sales for July, due Tuesday, are expected to come in at a seasonally adjusted annual rate of 4.63 million, which would mark a nearly 10% decline compared to a year earlier and the first time since June 2009 that the rate has fallen back below 5 million units. Credit Suisse economists believe the figures could reach their lowest level since at least 1999. New-home sales figures due Wednesday, meanwhile, are expected to stay flat with the previous month, at a near-record low of about 330,000 units.

Hard Times Are Getting Harder: Why The Silence?
By Danny Schechter - NewsDissector.com
WHO IS TALKING ABOUT WHAT MATTERS?
We know we live in hard times that are on the verge of getting harder with 500,000 new claims for unemployment last week, a recent record. The stock market may be over for now as fear and panic drives small investors out. Big corporations hoard stashes of cash rather then hire workers.
Foreclosures are up, and the Administration's programs to stop them are down, well below their stated goals, only helping 1/6th of those promised assistance.
And here's a statistic for you: 300,000. That's the number of foreclosure filings every month for the past 17 months. This year, 1.9 million homes will be lost, down from 2 million last year. Is that progress? In July alone, 92, 858 homes were repossessed.

Ron Paul - Discussing Austrian vs. Keynesian Economics

Housing Fades as a Means to Build Wealth, Analysts Say
By DAVID STREITFELD - NYTimes.com
Housing will eventually recover from its great swoon. But many real estate experts now believe that home ownership will never again yield rewards like those enjoyed in the second half of the 20th century, when houses not only provided shelter but also a plump nest egg.
The wealth generated by housing in those decades, particularly on the coasts, did more than assure the owners a comfortable retirement. It powered the economy, paying for the education of children and grandchildren, keeping the cruise ships and golf courses full and the restaurants humming.

A housing fix
Entice investors back to MBS mart
By JONATHON TRUGMAN - NYPost.com
On Aug. 17, the Treasury Department held a "conference" on the future of housing finance. Just a mere two years after the seismic fall, It comes after Healthcare and Fin-Reg. Priorities, huh?
So, Treasury Secretary Tim Geithner and Shaun Donovan of Housing and Urban Development held court with a dozen pre-selected panelists.
Not much really new came out of this confab except for the call by one to nationalize the industry and another to let the divine being sort things out (sort of).
Well, both are unrealistic. In the real world we need good, pragmatic solutions that work. This is serious stuff and so far the "A" Team hasn't come up with much.

California Short Sales and Foreclosures, Part 1 of 3

California Short Sales and Foreclosures, Part 2 of 3

California Short Sales and Foreclosures, Part 3 of 3

5 most (and least) affordable housing markets
First place: Syracuse, N.Y.
Median home price: $88,000
Median income: $64,300
Affordability score: 97.2%
This upstate New York City rocketed to the top of the most affordable major metro areas. More than 97% of all homes sold during the three months ended June 30 were within the reach of families earning the city's median family income.
Affordability is so high in Syracuse not because people make more money there -- the area's median income closely matches the national median of $64,400 -- but because home prices are so low. The median home sells for just under $65,000.

'Cash for clunkers' car dealers investigated
By Gregory Korte, USA TODAY
WASHINGTON - The government is investigating at least 20 car dealerships it claims violated the rules of last year's cash-for-clunkers program. Government auditors say up to $94 million in rebates may be ineligible because they lack the proper documentation.
One year after the $3 billion car-buying frenzy, the National Highway Traffic Safety Administration has reached an enforcement phase. Nine dealers have paid a total of $71,500 in fines.

Obama's GM bailout may destroy capitalism
Porter Stansberry - SilverBearCafe.com
I'm not going to get into what's fair. That's for individual bondholders to decide," explained new GM CEO (and former CFO) Fritz Henderson. Fair? There's nothing fair about doing business with the government or the unions...
Few people, especially in government and big business, seem to remember one of the founding principles of Western civilization and capitalism: private property. If you borrow someone's private property, you have to pay it back. It's not optional. GM has borrowed $27 billion from its bondholders - and Fritz Henderson was the person who arranged nearly all of these loans while he was CFO. Fritz promised lenders they would be repaid. If GM cannot repay these debts on time with interest, then according to all the laws of this country and 1,000 years of common-law tradition, GM's assets are legally transferred from the company's equity investors to the bondholders through bankruptcy. Them's the rules. But apparently, OBAMA! has other ideas about how things should work...

Fixing Social Security "Relatively Simple" But Pension Crisis Will "End in Tears," Mauldin Says
by Peter Gorenstein - TechTicker
Social Security turns 75 this month. A pillar of the New Deal era, Social Security remains vitally important to Americans and shapes the way many plan for retirement. "Half of Floridians on Social Security rely on the benefit for half their income. Some 25 percent count on Social Security for at least 90 percent of their income," notes a recent St. Petersburg Times story.
At 75, however, Social Security is showing its age. Based on current projections the program will fail to pay 100% of promised benefits in 2037. ItÕs also suffering a crisis of confidence among younger Americans. That same St. Pete Times article sites a recent USA Today-Gallup Poll that found 75% of those 18 to 34 "don't expect to get a Social Security check."

Fidelity: Withdrawals From Retirement Accounts Hit Record High
By HUGH COLLINS - DailyFinance.com
The number of workers making hardship withdrawals from their retirement accounts reached a record high in the second quarter as the sagging economy drains household wealth.
High unemployment, fewer working hours and reduced amounts of overtime have hit the take-home pay of many workers, The Associated Press reported.
"People tend to be taking home less," Beth McHugh, vice president of marketing insight at Fidelity Investments, told the AP. "As a result the percentage of individuals initiating hardship distributions is one of the things we're concerned about."

The Erosion of America's Middle Class
by Thomas Schulz - LewRockwell.com
While America's super-rich congratulate themselves on donating billions to charity, the rest of the country is worse off than ever. Long-term unemployment is rising and millions of Americans are struggling to survive. The gap between rich and poor is wider than ever and the middle class is disappearing.
Ventura is a small city on the Pacific coast, about an hour's drive north of Los Angeles. Luxury homes with a view of the ocean dot the hillsides, and the beaches are popular with surfers. Ventura is storybook California. "It's a well-off place," says Captain William Finley. "But about 20 percent of the city is what we call at risk of homelessness." Finley heads the local branch of the Salvation Army.

Understanding America's Class System...
Honk if you love caviar
Joe Bageant - SilverBearCafe.com
How about them political elites, huh? Five million bucks for Chelsea Clinton's wedding, 15K just to rent the air-conditioned shitters - huge chrome and glass babies with hot water and everything. No gas masks and waxy little squares of toilet paper for those guys.
Yes, it looks big time from the cheap seats. But the truth is that when we are looking at the political elite, we are looking at the dancing monkey, not the organ grinder who calls the tune. Washington's political class is about as upwardly removed from ordinary citizens as the ruling class is from the political class. For instance, they do not work for a living in the normal sense of a job, but rather obtain their income from abstractions such as investment and law, neither of which ever gave anybody a hernia or carpal tunnel. By comparison, the ruling class does not work at all.

How Many Laws Have You Broken Today?
by Mark Nestmann - LewRockwell.com
If you're like most Americans, you violate numerous laws each day, probably without even knowing it.
As I wrote in a blog entry nearly three years ago, in New Jersey, you can be arrested for driving by your own home. In Florida, a man was sentenced to six years in prison for carrying cash. In Pennsylvania, a woman faces prison for yelling obscenities at her clogged toilet. You can even be imprisoned for the crime of withdrawing lawfully earned currency from your own bank account.

Ron Paul: The American Empire Can't Afford Another War!

Top Expert: Geology is "Fractured", Relief Wells May Fail ...
Washington's Blog
BP is Using a "Cloak of Silence", Refusing to Share Even Basic Data with the Government
Few people in the world know more about oil drilling disasters than Dr. Robert Bea.
Bea teaches engineering at the University of California Berkeley, and has 55 years of experience in engineering and management of design, construction, maintenance, operation, and decommissioning of engineered systems including offshore platforms, pipelines and floating facilities. Bea has worked for many years in governmental and quasi-governmental roles, and has been a high-level governmental adviser concerning disasters. He worked for 16 years as a top mechanical engineer and manager for Shell Oil, and has worked with Bechtel and the Army Corps of Engineers. One of the world's top experts in offshore drilling problems, Bea is a member of the Deepwater Horizon Study Group, and has been interviewed by news media around the world concerning the BP oil disaster.
Washington's Blog spoke with Dr. Bea yesterday.

Scientists Question Government's Gulf Oil Findings

On the Death of Matthew Simmons
Tom Whipple - SilverBearCafe.com
Last week Matt Simmons, who was America's preeminent proponent of the idea that world oil production was about to peak, died at the age of 67. Simmons was unique among those talking and writing about peak oil in that he came from the very heart of American capitalism, a self-made investment banker for the oil industry. Unlike most who are outspoken on the issue of peak oil, Simmons was a Republican, an energy advisor to President George W. Bush, and commanded the attention of the financial and mainstream media.
Whenever the price of gasoline got a little too high for comfort, the worthies of the Fourth Estate would summon the unorthodox-but-acceptable Simmons to explain to obviously skeptical interviewers just why he believed that cheap gasoline would not be around much longer.

Is Barack Obama Really A Saudi / Muslim "Plant"
in the White House?

Israelis and Palestinians Plan Direct Peace Talks

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Archived Page Link
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Friday 08.20.2010

Iran watch . . . updated Friday mid-day

Is War with Iran imminent?
by Claude Salhani - OilPrice.com
Iran, it is believed, is on the fast track to develop nuclear weapons which Israel sees as a direct threat to not only its security, but to its very existence. The question is just how real is the threat of a nuclear-armed Iran?
Would the Islamic Republic deploy nukes against the Jewish state? In spite the rhetoric from its leadership, primarily its president, the possibility of an Iranian strike against Israel is most unlikely. Iran knows the repost will be instantaneous and devastating.

A major military surprise is close.
Galant scandal a smokescreen
DEBKAfile Special Report
War preparations are reported by DEBKAfile's military sources in Tehran and Damascus, DEBKAfile's military sources report.
In Tehran, Iran's Revolutionary Guards announced Friday, Aug. 20: "IRGC is in full readiness to encounter firmly with the stupidity of the US and the Zionist regime."
In Damascus, Syrian prime minister Naji al-Otari gathered his ministers and heads of security and emergency services Thursday and ordered them to place all their services on immediate war readiness.
And sources close to the Palestinian Authority leader Mahmoud Abbas quoted him as saying that direct talks with Israel were not in the offing because "a big military surprise awaits the Middle East."

Worst-Case Scenarios: Possible Strike Plans for Iran Involve Risky Options
By Judson Berger - FOXNews.com
At some point, military leaders in the United States and in Israel will have to decide: Which is more dangerous -- an Iran capable of launching a nuclear weapon? Or an Iran that just got hit with tons of artillery and is out for revenge?Ê
Both scenarios are frightening, particularly to the Israelis. U.S. officials have described the prospects of a nuclear-armed Iran and a military confrontation as equally terrible, particularly at a time when the Obama administration is trying to end nearly a decade of war in Iraq and Afghanistan.
But the thought of military action is not far-fetched. The United States acknowledges it possesses an attack plan for Iran, and the Israelis reportedly have drawn up specific scenarios for a strike.

Gulf States Pushing for Attack on Iran
by Hillel Fendel - IsraelInternationslNews.com
First it was the United Arab Emirates ambassador in Washington, now it's a Saudi Arabian editorial, and John Bolton says the entire Persian Gulf feels the same: an attack on Iran is the only option - if it's not too late.
An editorial in an official Saudi Arabian newspaper indicates that a military attack against Iran might be the only way of stopping it from obtaining nuclear weapons. "Tehran is moving its conflict with the international community into high gear," the Al Madina daily wrote this week, "and [in this case] some may consider the military option to be the best solution."

Israelis Conducting Covert Maritime Operations in Persian Gulf
by Wayne Madsen - OilPrice.com
Chinese and Japanese intelligence agencies, which closely monitor events in the Persian Gulf due to the dependence of both countries on oil from the region, report that Israeli Navy commandos have recently been active in creating maritime incidents in the Gulf that could be blamed on Iran.
The five incidents that have Israel under the scrutiny of the intelligence services of China and Japan, the world's second and third largest economic powers, respectively, are the "robbery" attacks on four merchant ships off Basra, Iraq on August 8 and the July 28 explosion on the Japanese supertanker MV M. Star in the strategic Strait of Hormuz.

Al-Qaida prepares for Israel-Iran war
By JPOST.COM STAFF
Report: Al-Shehri warns against "the greater state of Israel."
Al-Qaida is ready to exploit a war "by the Jews against Iran," the Sunni group's second-in-command in Yemen, Saeed al-Shehri, said in an audio message this month, according to the Daily Beast.
The mostly Shi'ite nation of Iran is an enemy to Al-Qaida, and al-Shehri predicted that after Israel attacked Iranian nuclear installations, Iran would blame Saudi Arabia - which reports say may let Israel fly through its airspace to attack Iran - and use the opportunity to seize the holy cities of Mecca and Medina in Saudi Arabia.

U.S. Assures Israel That Iran Threat Is Not Imminent
By MARK MAZZETTI and DAVID E. SANGER - NYTimes.com
WASHINGTON - The Obama administration, citing evidence of continued troubles inside Iran's nuclear program, has persuaded Israel that it would take roughly a year - and perhaps longer ... for Iran to complete what one senior official called a "dash" for a nuclear weapon, according to American officials.
Administration officials said they believe the assessment has dimmed the prospect that Israel would pre-emptively strike against the country's nuclear facilities within the next year, as Israeli officials have suggested in thinly veiled threats.

Will Israel attack Iran's nuclear reactor?
By Chet Nagle - DailyCaller.com
Russia will begin loading fuel rods into Iran's new nuclear reactor on Friday. Ultimately, the Bushehr complex will produce Plutonium (Pu239) much faster than centrifuges can deliver Uranium (U235), and Pu239 is better material for atomic weapons. But unlike attacks on similar reactors in Iraq (1981) and Syria (2007), the Israelis will not attempt to destroy Bushehr in the next two days or, indeed, two months. Why not?
There are sound reasons for Israel to allow the fueling of the complex's first reactor, the Bushehr 1. The main reason is that the Obama administration agreed not to oppose starting Bushehr 1 in exchange for Russia's support of UN sanctions on Iran. Though those sanctions are largely useless, and though Russia, China, and others will continue to cheat on sanctions, Israel will not overtly oppose U.S. policy unless there is a clear and present danger to Israel. To embellish his policy of no military action against the Islamic Republic of Iran, President Obama signaled he wants to talk to Iran's president, Mahmoud Ahmadinejad - a futile wish he has made at least twice before. Echoing that sentiment, the State Department pooh-poohed the latest UN report on Iran's uranium enrichment violations by saying,"We are hopeful that Iran will express a willingness to come to the table. We stand ready to have that dialogue."

America Cannot Go to War for Israel
by Ahmed Moor - HuffingtonPost.com
The mongrel dogs of war are foaming at the bit. For years they've cowered in their damp trenches, bristling in the heat. But they're back now. They've gathered their sagging flesh and cast their milky, crusty eyes at Iran. The mongrel dogs of war are planning another war.
The Zionists Benjamin Netanyahu, Jeffrey Goldberg and George Will want young American men and women to attack Iran on behalf of Israel. These are the same men who wanted young American men to attack Iraq. But Iran is not Iraq, and many thousands of Americans will die in the next war. This will not be a cakewalk or a slam dunk. And no enwreathed children will greet Americans in the streets with lily-white flower petals.

HOMEOWNERS' REBELLION:
COULD 62 MILLION HOMES BE FORECLOSURE-PROOF?
Ellen Brown, WebOfDebt.com
.... MERS was convenient for the mortgage industry, but courts are now questioning the impact of all of this financial juggling when it comes to mortgage ownership. To foreclose on real property, the plaintiff must be able to establish the chain of title entitling it to relief. But MERS has acknowledged, and recent cases have held, that MERS is a mere "nominee" - an entity appointed by the true owner simply for the purpose of holding property in order to facilitate transactions. Recent court opinions stress that this defect is not just a procedural but is a substantive failure, one that is fatal to the plaintiff's legal ability to foreclose.
That means hordes of victims of predatory lending could end up owning their homes free and clear - while the financial industry could end up skewered on its own sword.

REPEALING OBAMACARE: HR 4972 and HR 5444
by William F. Jasper - Liberty News Online
Repealing ObamaCare is not an option - it is absolutely essential. It is absolutely essential, that is, if the United States of America is to survive as a constitutional republic with a federal government of limited powers. Repealing ObamaCare is also absolutely necessary if we hope to avoid national economic collapse.
To those who may think such statements are overblown, we strongly advise that they read, in particular, Thomas R. Eddlem's "Outcome of ObamaCare" as well as Michael Tennant's "The New World of ObamaCare." As these articles amply demonstrate, the mammoth "health care reform" bill that was rammed through Congress last March and signed by President Obama is jam-packed with dangerous language that will provide federal bureaucrats with vast new powers that are compatible with totalitarian systems of government, but not with the American tradition of liberty.

Analysts See $1.3 Trillion Deficit
By THE ASSOCIATED PRESS
WASHINGTON (AP) -- Congress' budget analysts are estimating that this year's federal deficit will exceed $1.3 trillion, slightly below last year's total but still a huge ocean of red ink.

China Dumps the Dollar as Yields Sink
BY DON MILLER, Associate Editor, Money Morning
China cut its holdings of Treasury notes and bonds by the most ever in June, instead favoring the debt of Europe, Japan and Korea. The move has fueled speculation that plummeting U.S. yields are driving away the Asian giant, which has ambitions for its currency, the yuan, to replace the dollar as the world's main reserve currency.
China's holdings of long-term Treasuries fell by $21.2 billion in June to $839.7 billion, a U.S. government report showed recently. Total Chinese investment in U.S. debt declined 2.8% to $843.7 billion, the smallest in a year, following a 3.6% slide in May.
The shift comes as President Barack Obama increases U.S. debt to record levels, making it harder to finance sales to sustain the U.S. economic expansion.

Western profits wilt on China's surging wages
By Ambrose Evans-Pritchard - Telegraph.co.uk
Rising wage and production costs in China are eating into the profits of Western companies and may soon set off an exodus of multinational companies to cheaper locations.
A report by Credit Suisse said the vast majority of US and European companies in China are expecting a "margin hit" over the next 12 months and fear they will not be able to pass on the costs to consumers, with the biggest worries in electronics, clothing, and retail.
The bank said Footlocker, Liz Claiborne, and Office Depot would tip into outright loss in a worst-case scenario, defined as a 20pc rise in costs without any pass-through to customers.

We're Rolling Over Even With The Fed Openly Juicing The Market?
By: Graham Summers - iStockAnalyst.com
Is that all she wrote?
The bulls have gunned for 1,100 on the S&P 500 twice now in the last two days. Both times they got strongly rejected. In fact, yesterday's ramp job failed to even take out the Tuesday high of 1,099. This is hardly a bullish development especially given what's going on "behind the scenes."
As I've mentioned countless times, options expiration week is when the Federal Reserve makes its largest money pumps into the Wall Street banks. In fact, the Fed continued this practice even AFTER QE 1 officially ended in March 2010.

Gold manipulation: Central banks are now in deep trouble
FinanceAndEconomics.org
Central banks have routinely manipulated the gold market since the beginning of fractional reserve banking, but they have always eventually failed in their quest. This time there is circumstantial evidence that we could be on the verge of the most spectacular failure so far.
Physical bullion differs from other investment media because today there is no secondary market. Buyers of bullion are not speculators, or even investors: they take delivery, hoarding it from the market, and are not tempted to resupply it at any price. To some degree this loss from the market has been replaced by newly mined gold and scrap, but the size of the market is such that gold from these sources is now insufficient for hoarding demand. So when the bullion banks try to shake out the bulls, as they have recently, they may manage to reduce their short position in the paper markets; but the lower prices for bullion simply generates extra physical demand. The result is that the size of the paper market has become increasingly dangerous relative to the physical gold actually available.

The Failure of the Second London Gold Pool
By: Adrian Douglas - GoldSeek.com
This article is a sequel to my article entitled "Gold Market is not "Fixed", it's Rigged" which is essential reading before reading this article. The previous article demonstrated that had a trader consistently bought gold on the London AM Fix and sold it the same day on the London PM Fix and repeated it every day from April 2001 through to today the cumulative loss would be $500 per ounce. Yet gold has been in a bull market during that time and a "buy and hold" strategy over the same time period would have returned a gain of $950 per ounce.
I have termed the arithmetic difference between the PM Fix and the AM Fix the "intraday change." Figure 1 shows the evolution of the cumulative intraday change from 2001 to 2010 along with the gold price evolution as expressed by the London PM Fix price.

The Stealth Debt Restructuring: Inflation
By JACK EWING - NYTimes.com
Europe's sovereign debt crisis seems to have gone on holiday along with most of the rest of the Continent during August. But many economists warn that the underlying debt problem is merely in remission and could recur at any moment, once again upsetting world markets.
Joachim Fels, co-head of global economics at Morgan Stanley, talked Thursday about how Europe is ultimately likely to deal with excessive debt in Greece, Spain, Portugal and several other countries. His answer boils down to one word: inflation.

Dying of Money: Lessons of the Great German and American Inflations [Rare book PDF] by Jen O. Parsson
Most of us have at least a general idea of what we think inflation is. Inflation is the state of affairs in which prices go up. Inflation is an old, old story. Inflation is almost as ancient as money is, and money is almost as ancient as man himself.

Top feeds off the bottom
by Yogibear101 - Wall Street Examiner Forums and Bears Chat
You, we and 6 billion others are the bottom
The center of the financial universe is London, it's been in control since a calendar was invented.
Credit is money
No credit=no money
No money=the bottom is dead
The bottom dies=the top dies (in style of course)
If you wish to survive the die back, buy a tent and bic lighters.

The Great American Bond Bubble
If 10-year interest rates, which are now 2.8%, rise to 4% as they did last spring, bondholders will suffer a capital loss more than three times the current yield.
By JEREMY SIEGEL AND JEREMY SCHWARTZ
Ten years ago we experienced the biggest bubble in U.S. stock market history-the Internet and technology mania that saw high-flying tech stocks selling at an excess of 100 times earnings. The aftermath was predictable: Most of these highfliers declined 80% or more, and the Nasdaq today sells at less than half the peak it reached a decade ago.
A similar bubble is expanding today that may have far more serious consequences for investors. It is in bonds, particularly U.S. Treasury bonds. Investors, disenchanted with the stock market, have been pouring money into bond funds, and Treasury bonds have been among their favorites. The Investment Company Institute reports that from January 2008 through June 2010, outflows from equity funds totaled $232 billion while bond funds have seen a massive $559 billion of inflows.
We believe what is happening today is the flip side of what happened in 2000.

Hawker, union to start talks today
WICHITA BUSINESS JOURNAL - BY Chris Moon
Contract talks begin today between the International Association of Machinists and Aerospace Workers and Hawker Beechcraft Corp. - a discussion that could play a pivotal role in the plane-maker's future presence in Wichita.
The two sides are reopening talks after Hawker has said it is considering moving work outside of Wichita and, possibly, outside the United States.
The union's negotiating committee has said not reopening negotiations with Hawker "would be grim, drastically affecting the employment levels and the future of Wichita operations." The union has been talking with Hawker for the past several weeks about reopening negotiations.

NO GOLDEN EGG FROM THIS GOOSE
PowerLine.com
Fox News reports that new applications for unemployment insurance reached the half-million mark last week for the first time since November. According to the Department of Labor, there were no special factors that distorted the numbers. Therefore, this news is more evidence that employers are cutting jobs again as the economy slows.
Many economists had warned that a robust recovery was by no means guaranteed. Now, some are now predicting a double-dip recession and/or a lengthy period of stagnation like the one Japan experienced for about a decade.

Taxpayers on the hook for $3 trillion in pensions
By Hibah Yousuf,
NEW YORK (CNNMoney.com) -- Even if the costly state pension system undergoes reform, taxpayers could get stuck with a hefty bill.
Under the current system, unfunded benefit liabilities -- the amount states owe in promised retirement benefits beyond what they've collected -- exceed $3 trillion.
But even moderate policy changes, which are highly controversial, would only trim that amount by a pinch, according to a recent study released Thursday by Northwestern University economist Joshua Rauh.

Jobless claims rise to highest level in 9 months
By CHRISTOPHER S. RUGABER - AP - MSNBC.com
WASHINGTON - New applications for unemployment insurance reached the half-million mark last week for the first time since November, a sign that employers are likely cutting jobs again as the economy slows.
The Labor Department said Thursday that initial claims for jobless benefits rose by 12,000 last week to 500,000, the fourth increase in the past five weeks. Wall Street economists forecast that claims would drop.

Jobless Data Overshadows Intel Deal on Wall Street
By THE ASSOCIATED PRESS
Shares on Wall Street retreated Thursday after the Labor Department said claims for unemployment benefits rose unexpectedly, renewing concerns about the pace of a recovery.
The disappointing news about the jobs market came minutes after investors learned that the chip maker Intel was acquiring McAfee. The acquisition, valued at $7.68 billion, helped cushion the fall from the rise in unemployment benefit claims. Under the deal, Intel will pay $48 a share in cash, a 60 percent premium over McAfee's Wednesday closing price of $29.93.

Michael Moore: Profits Are Way Up at General Motors ...
So Why Aren't They Hiring?
"If we want a life worth living for ourselves and our kids, we have to go get it ourselves. We can't keep waiting for the cavalry to come. That's because we're the cavalry."
Michael Moore - AlterNet.com
So General Motors is back to making billions in profit. And if the past is any guide, we know what that means: time for some layoffs!
Or maybe not. Back in the '80s and '90s, when GM was consistently posting giant profits, they were simultaneously firing tens of thousands of workers in my hometown of Flint and across Michigan. Right now it looks like the only person being canned is CEO Edward Whitacre. (Only last week Whitacre was saying he wasn't planning to leave anytime soon-kind of ironic that the former president of the Boy Scouts of America failed to Be Prepared.)
But if they're not laying people off yet, they're also not hiring.

Four bankruptcies in Kansas per 1,000 residents
WICHITA BUSINESS JOURNAL - BY Emily Behlmann
There were 4.04 bankruptcy filings in Kansas for every 1,000 residents during the year that ended June 30, 2010, according to data released this week by the Administrative Office of the United States Courts.
The data shows increases in bankruptcy filings nationwide.
Kansas' total means the state had the 32nd highest rate of per-capita bankruptcies nationwide.
Nevada had the highest rate, with 11.74 bankruptcies filed during the year for every 1,000 people.
A majority of bankruptcy filings on the nationwide report - about 90 percent - were by individuals, not businesses.

Four Banks May Face $42B Loss
By: Zacks Equity Research
The four largest U.S. banks may incur losses of up to $42 billion if housing finance giants Fannie Mae (FNMA - Snapshot Report) and Freddie Mac (FMCC - Analyst Report) force them to repurchase faulty mortgages, Fitch Ratings stated on Wednesday.
The four banks are JPMorgan Chase & Co. (JPM - Analyst Report), Citigroup Inc. (C - Analyst Report), Bank of America Corp. (BAC - Analyst Report) and Wells Fargo & Co. (WFC - Analyst Report). According to the rating agency, if these banks repurchase 25% of the mortgage giants' troubled loans, the expected loss would be $17 billion. However, if the government-sponsored entities (GSEs) compel them to repurchase half of their faulty loans, the loss could extend to $42 billion.
Fitch also said that if the scenario becomes extremely worse, the faulty loan amount for these four banks could total $175 billion to $180 billion.

5 Trillion More Dollars To Fix Fannie Mae And Freddie Mac???
TheEconomicCollapseBlog.com
Fannie Mae and Freddie Mac have become gigantic financial black holes that the U.S. government endlessly pours massive quantities of money into. Unfortunately, if the U.S. government did allow Fannie Mae and Freddie Mac to totally implode, both the mortgage industry and the housing industry in the United States would completely collapse. So essentially the U.S. government finds itself between a rock and a hard place. Prior to the financial crisis of the last few years, Fannie Mae and Freddie Mac were profit-seeking private corporations that also had a government-chartered mission of expanding home ownership in America. But now that they have been officially taken over by the U.S. government, they have become gigantic bottomless money pits. It is hard to even describe just how much of a mess Fannie and Freddie are in. However, the unprecedented intervention by Fannie Mae and Freddie Mac in the mortgage market over the past couple of years has been about the only thing that has kept it from plunging into absolute chaos. So what does the future hold for Fannie Mae and for Freddie Mac? Well, according to one estimate, it could take another 5 trillion dollars to "fix" Fannie Mae And Freddie Mac.

Foreclosure rate soars in suburbs
Affluent areas now are among the hardest hit
BY STEVE LAW - The Portland Tribune
While Portlanders continue to be plagued by home foreclosures, the number of distressed homeowners is spiking even faster in the suburbs these days.
Foreclosure actions filed against homeowners in upscale Lake Oswego mushroomed 20 percent the first six months of this year, compared with the same period last year, and rose 10 percent in jobs-rich Hillsboro, according to RealtyTrac Inc., an Irvine, Calif., real estate data services company. RealtyTrac counted nearly 300 Lake Oswego properties socked with foreclosure actions from January through June and more than 500 Hillsboro properties.

Refinancing homeowners are going short
By Bill Briggs - msnbc.com contributor
Many customers take 30-year loans down to 15 or 20
After being blindsided by a job loss last spring, sales exec Ren Chirakos didn't need his new MBA degree to calculate the scary numbers: The math got simple real fast.
Zero income + new COBRA bills + a house payment = something had to give in the Chirakos family budget. The answer: refinancing his 30-year home loan to a shorter mortgage that tapped into the trend of ever-shrinking interest rates.
"I needed to keep my house," said Chirakos, who since has found work at a different company in Cuyahoga Falls, Ohio. His wife is a stay-home mom who cares for their two daughters. "It forces you to look at 'OK, where is our money going?' You start looking for ways to shave fixed expenses. It really gives you cause to think."

Many renters don't ever plan to buy a house
BIRMINGHAM BUSINESS JOURNAL
More than a quarter of people who rent a place to live do not plan to buy a home, ever, according to a survey by real estate information business Trulia Inc.
San Francisco-based Trulia found that 27 percent of renters don't ever plan to buy, and that two-thirds of those who do plan to buy will wait more than two years. Such postponed buying could delay the U.S. housing market's recovery, Trulia said.
Pete Flint, Trulia's CEO, said, "Renters converting into buyers are crucial to turning around the housing slump."

California close to issuing IOUs - again
By Tami Luhby, senior writer
NEW YORK (CNNMoney.com) -- California is once again running out of money and may have to issue IOUs within a few weeks.
The state's financial crunch stems from the fact that it does not have a budget for the current fiscal year, which began July 1. The governor and lawmakers continue to squabble over how to close an estimated $19 billion shortfall.
State Controller John Chiang said Wednesday that the state could have to issue IOUs in two to four weeks to keep the state solvent. He estimates there are $2.2 billion in expenses -- mainly to social service agencies, vendors and schools -- that will go unpaid in August.

Pizza Hut Cuts Prices Again to Counteract the Slow Recovery
By STUART ELLIOTT - NYTimes.com
MONTHS after stirring up the pizza category with promotional price cuts, Pizza Hut is putting its products on sale.
Pizza Hut, part of Yum Brands, plans to introduce a campaign on Sunday for new everyday low prices on its mainstay menu items. Most medium pizzas will cost $8, most large pizzas will be priced at $10 and most so-called specialty pizzas - like the new behemoth Big Italy pie, which has 18 slices - will cost $12 each.

Intel to buy McAfee for $7.68 billion
by Lance Whitney - CNETNews.com
Intel plans to buy security company McAfee for $7.68 billion--the biggest acquisition in its 42-year history.
The chipmaker said Thursday it has entered into a definitive agreement to buy all of McAfee's common stock at $48 per share in cash. McAfee's stock closed Wednesday at $29.93, making Intel's offer a 60 percent premium.
The boards of both companies have approved the deal.
Security has become an essential element of online computing, on par with energy-efficient performance and connectivity, Intel said. But today's security isn't adequately addressing the array of new Net-connected machines on the market, such as mobile devices, TVs, cars, ATMs, and medical gadgets, according to Intel. Offering protection requires a new approach that can tie together software, hardware, and services, the company said.

Court OKs Covert iPhone Audio Recording
By David Kravets - Wired.com
Using an iPhone to secretly record a conversation is not a violation of the Wiretap Act if done for legitimate purposes, a federal appeals court has ruled.
"The defendant must have the intent to use the illicit recording to commit a tort of crime beyond the act of recording itself," (.pdf) the 2nd U.S. Circuit Court of Appeals ruled.
Friday's decision by the 2nd U.S. Circuit Court of Appeals, which involves a civil lawsuit over a secret audio recording produced from the 99-cent Recorder app, mirrors decisions in at least three other federal appeals courts.

Oil Plume From Spill Persists, Data Show
By ROBERT LEE HOTZ - WSJ.com (free)
Oil from the Deepwater Horizon spill formed an underwater plume of hydrocarbons the size of Manhattan, scientists said Thursday, raising fears of a lingering cloud of trace chemicals in the Gulf with an unknown long-term impact.
The new findings from the Woods Hole Oceanographic Institution add to evidence from other research groups this week that the offshore spill - the largest in history - is confounding scientists' assumptions about how the Gulf waters are interacting with the mass of oil.

BP and the Government Are Underplaying the Difficulty of Stopping the Oil Leak - Washington's Blog
While BP and the government say that permanently capping the oil well is no problem, they act like they have little idea of what they're doing.
Indeed, Admiral Thad Allen is now saying "We're concerned about the vital signs of this well":

"Concerned about the vital signs of this well --
We continue to be concerned about the vital signs"

He's also saying that completion of relief well will be delayed until mid-September, at the earliest, and that the government is looking for problematic "material" in the well:

JUST IN: Feds delay completion of relief well until MID-SEPTEMBER... "HOPEFULLY"

What's really going on?
Well, initially, if the well had structural integrity, there wouldn't be concern about the "vital signs" of the well, there wouldn't have been delay after delay in completing the relief wells, there wouldn't be never-ending rounds of new tests, there wouldn't have been an attempt to seal it (or perhaps more accurately, patch it) from the top using cement, there wouldn't be an attempt to remove "material" from the well.

Oil Plumes May Be More Toxic Than Thought, Scientists Warn
By JOHN COLLINS RUDOLF - NYTimes.com
Undersea plumes of microscopic oil droplets extending dozens of miles from the BP wellhead may be more toxic to marine microorganisms in the Gulf of Mexico than previously believed, according to preliminary experimental results from Florida researchers.
Scientists from the University of South Florida, working from a research vessel northeast of the wellhead, found oil droplets scattered in sediment along the gulf floor and in the water column, they said in a report on Tuesday. The dispersed oil appeared to be having a toxic effect on bacteria and phytoplankton, a photosynthetic microorganism that serves as a vital food for fish and other marine life.

The Age of Treason: 1958 Book Exposes Chemical Attack on Humanity
By Daniel Taylor - Old-Thinker News
Dr. R. Swinburne Clymer was in many ways a man ahead of his time, and most certainly controversial. He was attacked by the medical establishment for connecting diet with disease and mental health in his 1917 book Dietetics. Dr. Clymer received his medical degree in 1902 from the College of Medicine and Surgery in Chicago and began practicing Osteopathy. Accusations of fraud surround Dr. Clymer's career, including this 1923 edition of the Journal of the American Medical Association which claims that, "Our records fail to show that this man was ever regularly graduated by any reputable medical college." What Clymer had to say more than likely had something to do with the denouncement that he received from the medical establishment.
Though Dr. Clymer may be surrounded with controversy, his 1958 book Your Health and Sanity in the Age of Treason exposes toxic food additives and fluoride with documentation - the majority of which are mainstream scientific studies - that can be verified many times over. What makes this book unique is the fact that Dr. Clymer was one of the first to point out that statements by the elite indicated that these toxins were to be deliberately released "...for the mental deterioration and moral debasement of the mass..."

Growing number unsure of Obama's religion
by Mike Memoli - The Swamp - Chicago Tribune in Washington
For the first time in its polling, the Pew Research Center finds that more Americans don't know what President Obama's religion is than correctly identify him as a Christian.
All told, more than two-in-five Americans say they aren't clear about the president's religion, up 9 percent from the previous survey in March 2009. Only 34 percent say Obama is Christian, down a whopping 14 percent.

THE GREAT DECEIVER - Mike Fischer

Sheriff's Challenge to Obama:
Give Me Half Hour, I'll Show You How to Secure Border
By Terence P. Jeffrey, Editor-in-Chief
(CNSNews.com) - Sheriff Paul Babeu of Pinal County, Ariz., is issuing an invitation to President Barack Obama: If the president will come and spend a half hour with Babeu in Arizona, the sheriff says, he will convince the president he can succeed in securing the border and thus make himself a hero who transcends partisan politics.
Babeu's southern Arizona county, while not contiguous with the border, has been designated by the Justice Department as part of a High Intensity Drug Trafficking region that is a major route for drug and alien smugglers bringing narcotics and illegal aliens into the United States from Mexico. Babeu has joined with Sheriff Larry Dever of neighboring Cochise County, Ariz.-which does sit on the border - as well as with Arizona's two senators, John McCain and Jon Kyl, in endorsing a ten-point plan for securing the border.

Nearly Half of United States Considering Arizona-Style Immigration Legislation - By Fred Lucas, Staff Writer
(CNSNews.com) - Twenty-two states are now in the process of drafting or seeking to pass legislation similar to Arizona's law against illegal immigration. This is occurring despite the fact that the Obama administration has filed a lawsuit against the Arizona law and a federal judge has ruled against portions of that law - a ruling that is now being appealed.
Next month, two Rhode Island state lawmakers, a Democrat and a Republican, will travel to Arizona to speak with Republican Gov. Jan Brewer, local sheriffs, and other officials about how to better craft their own bipartisan immigration bill for Rhode Island, which already has been enforcing some federal immigration laws.

Mexico Under Siege
Business Heads Plead as Drug Gangs Terrorize Wealthy City
By NICHOLAS CASEY - WSJ.com (free)
MONTERREY, Mexico - A surge of drug violence in Mexico's business capital and richest city has prompted an outcry from business leaders who on Wednesday took out full-page ads asking President Felipe Calderón to send in more soldiers to stem the violence.
The growing violence in Monterrey, long one of Mexico's most modern and safe cities, is a sign that the country's war against drug gangs is spreading ever further from poorer battlegrounds along the border and into the country's wealthiest enclaves.

La Raza: Deporting 12 Million Illegal Aliens
'Not a Realistic Solution' and U.S. Should Stop Trying
By Adam Cassandra
(CNSNews.com) - The United States cannot deport all 12 million illegal aliens in the United States and should stop trying, a spokeswoman for the National Council of La Raza (NCLR) told CNSNews.com last week.
"We have to recognize that our immigration system has been broken for 20 years and there are now 12 million people living and working and praying among us who are here without documents. Many have spouses who are citizens or children fighting for our country," NCLR Immigration Field Coordinator A. Elena Lacayo said in an e-mail response to a question from CNSNews.com.
"Deporting 12 million people is not a realistic solution," she wrote. "It's time we create a rational immigration system, take these people out of the shadows and restore the rule of law."

Stepping Toward Nuclear Armageddon
Brad MacDonald - theTrumpet.com
Mahmoud Ahmadinejad is a step closer to his goal of setting off a nuclear apocalypse.
If reports are accurate, in less than 48 hours the Islamic Republic of Iran will begin feeding uranium into its first and only nuclear power plant.
The moment this "irreversible step" is taken, stated Sergei Novikov, a spokesman for the Russian nuclear agency assisting Tehran, the "Bushehr plant will be officially considered a nuclear energy installation." If all goes well, Iran will be producing fissile material by October.
Across the world, news of Bushehr's activation has been met with emotions ranging from apathy to alarm. The indifferent argue that Bushehr's activation was merely a matter of time, and that the facility will not pose a significant threat because it will be used for the production of nuclear energy for civilian consumption. Many others, such as Michael Anton in the Weekly Standard, are deeply concerned because Bushehr, once fueled and operating, "will produce plutonium 239, which can be used to make nuclear weapons."

Pyongyang on its knees: only potatoes to stave off famine
The capital's population had grown accustomed to a slightly better diet compared to the rest of the country. But the sanctions, the five-year plans and currency reform are beginning to be felt. And the population shows signs of timid protests against the regime.
Seoul (AsiaNews) - The population of Pyongyang, the capital of the Stalinist regime of North Korea, is increasingly frustrated because of the price of basic necessities and lack of basic foods in stores, according to former residents, who have fled to South Korea. They point the finger at the last year's disastrous currency reform and against the five years economic plan, which the regime insists on continuing.
According to one source, "market prices continue to rise. The population is angry, and complains of these factors. According to some estimates, 60% of the population is dissatisfied with the authorities". On the other hand the inhabitants of Pyongyang, given its proximity to political power, were used to having better access to goods passing through the country: now they have to survive on potatoes.

U.S.-South Korea Exercises Rile China
Beijing Says Joint Military Drills in Yellow Sea Risk
Imperiling Chinese National Security and Provoking Pyongyang
By ANDREW BROWNE And EVAN RAMSTAD - WSJ.com - $$
BEIJING-Plans by the U.S. and South Korea to conduct military exercises in the Yellow Sea aimed at North Korea, despite China's strong objections, are ratcheting up tensions between Beijing and Washington, already at loggerheads over sensitive regional security issues.
Chinese officials warn that the exercises threaten a crisis on China's doorstep by provoking North Korea, and could inflame public opinion in China.
"There's a real danger things could get out of control - and that would be a real threat for China's national security," a senior official said.

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Thursday 08.19.2010

Made in the USA! . . .

Eric's cousin, Mark, a special guest on today's show is the owner of
ENERGY SHIELD - Energy Tax Credit Approved
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Time is running out for the West
By Ambrose Evans-Pritchard - Telegraph.co.uk
The Great Recession has dramatically shrunk the time left for the big AAA states to prevent a full-blown sovereign debt crisis as their demographic time-bomb threatens, US rating agency Moody's has warned.
"Genuinely adverse debt dynamics were only expected to materialise in 15 to 20 years. The crisis has 'fast-forwarded' history, eroding all the time available to adjust," said the group's quarterly Sovereign Monitor.
Moody's fears that the US will crash through its safety buffer by 2013 if growth falters (adverse scenario), with interest payments topping 14pc of tax revenues. The debt-to-revenue ratio has already doubled in three years to 430pc.

While the Economists Lied the US Economy Died
Paul Craig Roberts - SilverBearCafe.com
On August 17, Bloomberg reported a US government release that industrial production rose twice as much as forecast, climbing 1 percent. Bloomberg interpreted this to mean that "increased business investment is propelling the gains in manufacturing, which accounts for 11 percent of the world's largest economy."
The stock market rose.
Let's look at this through the lens of statistician John Williams of shadowstats.com. Williams reports that "the primary driver of a 1.0% monthly gain in seasonally-adjusted July industrial production" was "warped seasonal factors" caused by "the irregular patterns in U.S. auto production in the last two years." Industrial production "shrank by 1.0% before seasonal adjustments."

The Boys From Brazil - Revisited
By: CAPTAINHOOK - GoldSeek.com
The economic news just keeps getting worse and worse (and worse), validating the view we spiraling down in another recession within a larger depression. Of course the effect this is having on an ever-decreasing population of traders (only the pros are left and their numbers are shrinking too as the trade patterns become increasingly bizarre) is to become even more bearish and keep on buying puts, because at some point stocks will turn lower to reflect the fundamentals, right? Unfortunately for surface dwellers that think like this they could keep the squeeze in stocks going far longer than most would remain solvent, being just fine with the bureaucracy because this will enable them to keep the illusion alive longer theoretically.

The World Won't Flock to Paper
National Inflation Association
On July 28th, NIA released an article entitled, "Gold and Silver Capitulation is Near". In this article NIA said, "The sentiment on gold and silver has abruptly changed to the negative like nothing we have ever seen before and to us this means the big move to the upside is right around the corner." It turns out that July 28th was the exact bottom for gold and silver prices. Since then, gold prices have risen 12 out of 15 days for a gain of 5.8% and silver prices have risen 11 out of 15 days for a gain of 5.2%.
It was just announced that China cut their long-term U.S. treasury holdings by $21.2 billion in June to $839.7 billion, their largest cut in U.S. treasury holdings in history. China's holdings of U.S. debt are now at their lowest level in a year. Meanwhile, China has more than doubled their holdings of South Korean debt. It speaks volumes that things have gotten so bad in the U.S. that China sees the need to diversify out of U.S. debt to buy the debt of a third-world nation.

Eighteen Signs That America Is Rotting Right In Front Of Our Eyes
The Economic Collapse - SilverBearCafe.com
Sometimes it isn't necessary to quote facts and figures about government debt, unemployment and the trade deficit in order to convey how badly America is decaying. The truth is that millions of Americans can watch America rotting right in front of their eyes by stepping out on their front porches. Record numbers of homes have been foreclosed on and in some of the most run down cities as many as a third of all houses have been abandoned. Unemployment remains at depressingly high levels and the number of Americans on food stamps continues to set new records month after month. Due to severe budget cuts, class sizes are exploding and school programs are being eliminated. In some areas of the U.S. schools are even going to four day weeks. With little to no funding available, bridges are crumbling and street lights are being turned off in many communities. In some areas, asphalt roads are actually being ground up and turned back into gravel roads because they are less expensive to maintain. There aren't even as many police available to patrol America's decaying cities because budget problems have forced local communities across the U.S. to lay off tens of thousands of officers.

10 Signs The U.S. is Becoming a Third World Country
Activist Post
The United States by every measure is hanging on by a thread to its First World status. Saddled by debt, engaged in wars on multiple fronts with a rising police state at home, declining economic productivity, and wild currency fluctuations all threaten America's future.
The general designations of the ranking system for world status date back to the 1950s, and have included countries at various stages of economic development. Since the Cold War, the definition has come to be synonymous with repressive countries where a wealthy class of ruling elites segment society into the haves and have-nots, many times capitalizing on the conditions that follow an economic crisis or war.

China Swallows Obama Stimulus Meant for U.S. Economy
Commentary by Andy Xie
Aug. 18 (Bloomberg) -- The global economy is like fried ice cream: If you don't act fast, it turns into a mess.
American pundits, Nobel laureates included, are predicting Japan-style deflation for the U.S. and Europe. They are urging the Federal Reserve to pursue another round of quantitative easing to stop the onset of an Ice Age for Western economies. The Fed didn't oblige at its last meeting, but it threw a bone to the deflation crowd by promising not to pull money out of its previous round of asset purchases to stimulate a recovery.

Mixed US Data Keeps the Dollar in a Tight Range
By Chris Gaffney - The DailyReckoning.com
08/18/10 St. Louis, Missouri - Chuck headed on a multi stop cross-country trek to get out to San Francisco today, so he left the Pfennig to me. I think he said he had to fly through Dallas to get over to San Francisco; just one of the joys of no longer being a 'hub'airport.
There was a plethora of data releases here in the US yesterday, but the numbers offset each other keeping the markets fairly stable. Surprisingly strong industrial production data was offset by weak housing starts. Other data showed that wholesale costs in the US increased in July for the first time in four months, throwing cold water on those warning of deflation. Commodity prices were the main driver of the increases of 4.2% versus last year. The core price index (ex food and energy) was still up 1.5%, slightly higher than economists' projections. The data will quiet those who are warning about falling prices and will likely keep the boys and girls over at the FOMC on a "steady as she goes" course.

The Capital-Scarce World To Come
Martin Hutchinson - SilverBearCafe.com
The last 15 years in global markets have been marked by one consistent factor: the ready availability, even overabundance of capital. Returns to investors have been driven down to dangerously low levels, both in debt and equity, by over-expansionary monetary policy, while asset values even after crashes have been far higher than their historical norms. Yet this insouciance about capital, this preparedness to waste it in one feckless bubble after another, must have an inevitable result: at some point in the near future we will face a world of capital scarcity, like the late 1930s in the United States, the early 1950s in Europe or the 1980s in Latin America.

Most Bush Tax Cuts Should Be Extended, Pimco's McCulley Says
By Mary Childs and Kathleen Hays
Aug. 18 (Bloomberg) -- President George W. Bush's tax cuts should be extended except for the top two brackets to help bolster the fragile economic recovery, said Paul McCulley, a managing director at Pacific Investment Management Co.
"Congress has to extend them or else the double-dip- recession risk will go up dramatically," McCulley said in a Bloomberg Radio interview with Kathleen Hays on 'The Hays Advantage.'

INFLATION 101
Jim Quinn - TheBurningPlatform.com
I know some of the people who come to this site understand financial concepts very well, but I also think there are many who might be confused by some of the terms we throw around on a daily basis. The most important concept for you to understand is inflation and how the Government and Federal Reserve have used it to screw you. They actually provide all the information you need to understand in one handy dandy chart. Here is the [download .txt file] link to that chart:
This chart provides the Consumer Price Index from 1913 until today. That is convenient because the Federal Reserve was created in 1913.
The CPI on January 1, 1913 was 9.8. Today it is 217.965. This means that a basket of goods that cost you $9.80 to buy in 1913 would now cost you $217.96. That is called inflation.
Another way to look at it is to divide 9.8 by 217.965. This equals .045. This means that a dollar in 1913 is now worth 4.5 cents. This is a 95.5% reduction in the purchasing power of a dollar in less than 100 years. The Federal Reserve has systematically screwed you for 97 years.

Prepare in August for Hyperinflationary Holidays
By: Dr. Jeffrey Lewis - GoldSeek.com
Ben Bernanke and the rest of the Federal Reserve are priming the pump for what could by a hyper-inflationary Christmas. While the Fed continues to build a pile of kindling, the spark could very well be this holiday shopping season.
Imagine that you had a pile of wood put together to make a camp fire. Your goal is to create the hottest fire imaginable, one that will last for quite some time. You start with the smallest pieces, a few leaves, a couple of pine cones, and a few small sticks. Next you throw on the larger timber. A few logs and some old fence posts will do here. Now, in the spirit of getting this camp fire going, you add a few gallons of pure gasoline. That should be enough to do it, right? Wait, what's that? You forgot the matches?!

The Fed Declares War on America
Drew Mason - SilverBearCafe.com
Bond markets aren't as forward-looking as Wall Street may believe
Does this title sound extreme? If you've been one of those Americans who has saved more than you borrowed and think your wealth is safe in savings accounts and bonds, this may not be extreme at all. As bond owners, CD holders and passbook savers, consciously or unconsciously Americans have stored wealth believing that the US government has their back. This week the Fed made it clear that additional quantitative easing is on the way and that savers of dollar-denominated investments won't be protected to any degree by Washington.

US Prepares For Gold Standard
By Bix Weir - GoldSeek.com
I have often written about the US Treasury and US Mint's very strange behavior when it comes to their part in continuing "business as usual" for the fiat monetary system. Although many have chalked up the Mint's rationing of Gold and Silver American Eagle coins to normal behavior of inept government employees and government bureaucracy, I have a much different take on the subject. I believe they are trying to DELAY and LIMIT the American Eagle program until such time as the US is ready to go back on a gold and silver standard.

The Great American Disaster:
How Much Gold Remains In Fort Knox?
by Chris Weber - LewRockwell.com
A Huge Mystery Remains To Be Solved
Yesterday marked the 39th anniversary of the day when the US Government declared bankruptcy. Oh, they didn't call it that at the time. But what happened on August 15, 1971 was that the US defaulted on its promise to pay gold for dollars.
Before that day, gold was the legal linchpin of the world monetary system. Although every currency was defined in terms of the US dollar, the dollar itself was legally defined as 1/35th of a troy ounce of gold.

All That Glitters...
Mary Anne & Pamela Aden - SilverBearCafe.com
It was another action packed month. The volatility never seems to end, at least that's the way it's been for many months now... actually, for the past few years.
The markets have essentially been reacting to the news of the day for what seems like ages. When the news is good, they rise. When it's bad, or perceived to be bad, the markets get nervous, they become vulnerable and they decline. And investors simply don't know what to do. They're still edgy and uncertain. And as long as this continues, the entire outcome could go either way....
Stay With Gold
So what's an investor to do? Stay in gold. Despite its recent volatility, it's the one investment that benefits during times of uncertainty. As you've seen, it does well during good times and bad. That's been true throughout history, and it still is.

Soros favoured gold in Q2, cut US equities
Gold now represents the billionaire investor's fund's biggest holding by dollar value and with the sale of so many other holdings, gold ETFs now represent almost 13% of the firms total equities
BOSTON (REUTERS) -
Billionaire investor George Soros in the second quarter stuck with his big bet on gold but slashed his holdings in dozens of major U.S. companies from Verizon Communications to Pfizer.
Soros also may have sold his entire holdings in Petroleo Brasileiro SA.
In a quarterly securities filing on Monday, Soros Fund Management reported owning substantially fewer U.S. listed stocks than three months earlier. The fund listed $5.1 billion of equities as of June 30, down 42 percent from $8.8 billion at the end of March.

Gold Rises for Third Day in New York as Demand for Haven Gains
By Millie Munshi
Aug. 18 (Bloomberg) -- Gold prices rose, capping a third straight gain, as investors purchased bullion as a haven.
Holdings in global exchange-traded-funds backed by bullion increased for five straight days, data compiled on Aug. 17 shows. That's the longest expansion streak since June 30. Gold reached a record $1,266.50 an ounce in June as investors sought a shield against financial turmoil and currency debasement.
"We're seeing a lot of clients increase their allocation to gold," said William Rhind, the head of U.S. sales and marketing for ETF Securities Ltd. in New York. "We're starting to see the safe-haven trade emerge again as people are uncertain about where growth is heading."

Gold price consolidation - poised for the next move?
Author: Lawrence Williams - MineWeb.com
The gold price appears to be consolidating again and we could well see its high tested and exceeded in September, historically a good month for the yellow metal.
LONDON - The pattern of the gold price over the past few days is for it to move up in steps - it has been reaching a level to prompt profit-taking by less-committed holders and once this profit taking is exhausted it pauses for breath, before moving up another small step. These steps have seemed to be at about $5 intervals of late. But lack of significant holding movement in the ETF sector also suggests the firmer holders are remaining with the precious metal.

Why gold bullion investment is risk free
By Stewart Thomson - CommodityOnline.com
"This is not working, let's try something new."
-approx. quotation from Deng Xiaoping, head of China, circa 1978.
Brilliant observation on Deng's part. Let's have a round of applause for Gman Deng. When you steal the entire wealth of your citizens for yourself, turn them into slaves, and murder millions of those who don't share your "enlightened new era vision," who prefer common sense instead of your Frankenstein Movie, yes, Deng, you need something new. Or maybe you shouldn't have tried to fix what wasn't broken by robbing and murdering millions. Just a "minor" observation on my part.
The past is the past, and Chinese corporations are moving forward, as is the Chinese Gman, (probably temporarily in the case of the Gman). Chinese citizens wonder if a day is coming where the goods in their dollar stores will be made in America. I don't see things going that far. It's a good thing that I don't. The 21st century will be about "the rise of many new major players" more than the new "Empire of China". Click here to read Jim "mighty man" Rogers' latest words on China, a view I not only share, but back up with personal buy action on the Chinese FXI-NYSE, the "Chinese Dow."

Protecting Your Cash, Part II
By Doug Casey - The DailyReckoning.com
08/18/10 Cafayate, Argentina - An Interview with Doug Casey from Cafayate, Argentina
Interviewer: Concerning the risk of foreign exchange controls here in the US, do you think people will have any warning at all?
Doug: I think it's going to come out of left field. It always does, with at most an official denial just before it happens. In August 1971, Nixon devalued the dollar, which immediately dropped against gold and all foreign currencies. I think there's a reasonable probability that the government will do that again. Gold may not be part of the equation, but they may decide to put in some sort of fixed exchange rate between the dollar and various foreign currencies.
The reason for thinking this is simple: with all the dollars outside the United States devalued by that much, that much of a liability just vanishes into thin air. And in the short term - it's never a long-term fix - US exports would go up. This would "stimulate" the domestic economy. Imports to the US would go down, which would make for fewer dollars leaving the US and adding to the $7 trillion overhang the US already has.

Gold resumes upward march
By Jeff Nichols - CommodityOnline.com
It looks increasingly likely that gold has already resumed its long upward march and before long could be registering new all-time highs.
Just in the past week or two there has been an important shift in world financial market sentiment and rising anxiety about the U.S. and global economic outlook is now prompting renewed investor interest in the yellow metal as a safe-haven asset.
Moreover, the latest news from the U.S. Federal Reserve, following last week's Federal Open Market Committee meeting, makes it clear that the Fed is resuming "quantitative easing," the Fed's code words for printing more money.

Gold turns volatile on profit selling
SINGAPORE (Commodity Online): Gold prices were slightly up but remained volatile in Asian trade Wednesday as some investors took to profit selling.
Gold for immediate delivery was seen trading at $1225. 81 an ounce at 12.00 noon Singapore time while U.S. gold futures for December delivery were steady at $1,227.5 an ounce.
Analysts however said, the precious yellow metal remained highly volatile and may swung between gains and losses during the day as record prompted some investors to sell to lock in gains.

Demand perspectives: driving the gold price ever higher
Six key demand factors which will come together and help drive the gold price upwards over the next couple of years.
Author: Julian D.W. Phillips - MineWeb.com
BENONI (GOLDFORECASTER.COM) -
At the moment, it appears that the gold price is being linked to the state of the global economic growth or lack thereof. Is it? Or are there other factors that contribute to the rise in the demand for gold? A look at the different types of demand gives us perspective on the real influences on the gold price.
CHINA
We start with this country's contribution to the gold price, because this week saw an announcement that China is now the second largest economy in the world as well as being the world's largest exporter. This is a landmark announcement as this country is headed fast to be the world's largest economy with the world's largest foreign exchange reserves.

Treasury Bonds Rise as Slowdown Fuels Fed Purchase Speculation
By Susanne Walker
Aug. 18 (Bloomberg) -- Treasury 30-year bonds rose, pushing yields to a 16-month low, as investors sought the highest- returning U.S. debt amid speculation the weakening economic recovery may prompt the Federal Reserve to boost debt purchases.
The Fed plans to acquire Treasuries due from 2016 to 2020 tomorrow, after buying $2.551 billion of debt yesterday, to hold borrowing costs down. It announced the purchases Aug. 10, saying it would buy securities for the first time since October using funds from principal payments of its holdings of mortgage-backed debt. Treasury notes erased gains as stocks rose.

Fed Buys $2.551 Billion Treasuries to Aid Economy
By Liz Capo McCormick and Mary Childs
Aug. 17 (Bloomberg) -- The Federal Reserve bought $2.551 billion of Treasuries in the first outright purchase of U.S. government debt since October to prevent money from being drained from the financial system.
The Fed bought 14 of the 25 securities listed for possible purchase. The notes mature from August 2014 to February 2016, the Federal Reserve Bank of New York said in a statement today on its website. The New York Fed conducts open-market operations to implement the policies of the Federal Reserve System.

Government Meddling: Bad News, Unless You're an Investor
By Ian Mathias - The DailyReckoning.com
08/18/10 Baltimore, Maryland - The stimulus debate du jour is how the government will save Fannie Mae and Freddie Mac. More government support is vital, said Treasury Secretary Timothy Geithner, the maestro of yesterday's White House housing summit, "to make sure that Americans can borrow at reasonable interest rates to buy a house even in a downturn." It is, after all, your God-given right.
To be clear, the Treasury "will make sure the GSEs have the resources to meet their financial commitments," Geithner added. Whatever the fate of Fannie and Freddie, it will be financed with tax dollars and controlled by government. Both companies, despite being at the very heart of the financial crisis, were left out of the recent Financial Reform Bill.

YOU WANT THEM TO CONTROL HEALTHCARE?
By Chuck Baldwin - NewsWithViews.com
Among the scariest words ever heard are, "We are from the federal government, and we are here to help you." Shiver me timbers, matey! When you hear those words, pick up your peg leg and RUN, because you are about to get hammered. And that is exactly what is fixing to happen to the American people when the new Obama national healthcare law is fully implemented: we are going to get hammered.

Fannie and Freddie: The Exit Doors are Shut
The Automatic Earth - SilverBearCafe.com
From a purely political point of view, it's a
simple story. Existing homeowners are a far more powerful force at the voting booth than potential owners, homebuyers, are. It's therefore very much in the interest of the incumbent government to keep home prices as high as it can. Let them slide too much and you will pay for that at the next election. For potential buyers you can devise plans that lower interest rates and down payments, but that's all. More affordability simply through power prices is not on the political table.

U.S. Banks May Face $180 Billion in Loan Buybacks, Fitch Says
By Laura Keeley
Aug. 18 (Bloomberg) -- Bank of America Corp., JPMorgan Chase & Co., Citigroup Inc. and Wells Fargo & Co. might face demands to repurchase as much as $180 billion of troubled mortgages from Fannie Mae and Freddie Mac, Fitch Ratings said.
At the end of June, the two government-sponsored loan guarantors held a total of $355 billion of troubled mortgages in their portfolios, of which half were serviced by the four banks, the largest in the U.S., Fitch wrote in a report. While it is "conceivable" that debt eligible for repurchase may surpass $175 billion in "an extremely adverse scenario," the banks are more likely to face lesser demands, depending on foreclosure rates and loan documentation.

Credit default swap deals unnerve California
By Nathaniel Popper, Los Angeles Times
Some say credit default swaps may influence the market for muni bonds.
Reporting from New York - Is Wall Street profiting from California's misery?
That's been a concern of state Treasurer Bill Lockyer, who takes a dim view of financial instruments - known as credit default swaps - that enable speculators to bet against California's ability to pay its debts.
Like other giant Wall Street firms, JPMorgan Chase & Co. helps investors place such bets against California but also earns hefty fees from the state for helping it get the best prices on the bonds it sells to finance capital improvements and other expenses.

Why the U.S. may not be the next Japan
By Paul R. La Monica
NEW YORK (CNNMoney.com) -- The fashionable thing for economists to worry about these days is deflation.
It's hard to go a day without someone proselytizing that the United States is the next Japan and that a Lost Decade looms on the horizon -- or might already have even begun.
The threat of deflation can't be cavalierly dismissed since there are plenty of troubling signs.
The job market is not recovering at a quick enough pace to spur consumers to spend. The housing market is still stagnant. And the Federal Reserve seems hell-bent on keeping both short-term and long-term rates low for the foreseeable future.

Letter from China: Where the consumer is queen
Fortune - CNNMoney.com
Fortune senior editor Jennifer Reingold is filing dispatches from China, where she is traveling with Procter & Gamble CEO Robert McDonald to observe the company's growing emphasis on Asia.
The apartment could be in an wealthy neighborhood in Paris or Manhattan: a gleaming kitchen with coffeemaker, a balcony with a child's bike perched outside, and his and her laptops. Instead, it belongs to an eager representative of China's exploding upper class, a 31-year old bank manager in Shanghai who is watching proudly as Bob McDonald, the CEO of Procter & Gamble (PG), inspects the contents of her bathroom cabinet.

Elephants in the Room
By Bill Baker - The DailyReckoning.com
08/18/10 Baltimore, Maryland -- Is it not heartening to politicians to seize and distribute today's wealth and promise more in future obligations knowing that erosion of the value of fiat currency will reduce the burden of government debt incurred?
Is not their public debt simply a scorecard representing the cumulative transfer of wealth mostly driven by past entitlements, for which politicians lacked the chutzpah to lay at the feet of the taxpayers?
To erase it with excessive printing of money would silently extract value from savers and investors, and most importantly cause capital to flee or be hoarded and essential investment to be foregone.

Tea, Tramadol & Today's Great Depression
By: Adrian Ash, BullionVault - GoldSeek.com
"Even at home there is generally a cup of tea going - a 'nice cup of tea' - and Father, who has been out of work since 1929, is temporarily happy because he has a sure tip for the Cesarewitch..."
- George Orwell, The Road to Wigan Pier (London, 1936)
SEVENTY YEARS AGO last month, just as the Battle of Britain began, tea rationing struck the seat of empire.
Really, Herr Hitler had gone too far this time!
Caffeine mixed with sugar, hot water and milk had fuelled the Industrial Revolution just as surely as did cheap coal and expensive sweat. From back-to-back slum to baronial pile - and starting long before London proclaimed Victoria the Empress of India in 1876 - the daily cares of imperial power had been eased every few hours by a "nice cup of tea". According to one 1749 record, a tradesman's family spent more on tea and sugar each week than they did on the basic staple of bread.

U.S. can no longer afford housing tax breaks
By Paul Wiseman, USA TODAY
WASHINGTON - Federal housing policy offers the wealthiest Americans billions in tax breaks without delivering much bang for the buck in increased homeownership, critics told government policymakers Tuesday.
"We aren't getting our money's worth," Mark Zandi, chief economist of Moody's Analytics, said at a government conference on reforming housing policy.
The government spent $230 billion last year to promote homeownership through tax breaks and spending programs. The biggest chunk - $80 billion - went toward the mortgage interest deduction, according to the Congressional Budget Office.

Loan Officer Survey Offers No Surprises. Credit Standards Still Tight
by Jann Swanson - MND Newswire
Credit appears to be slowly loosening according to the July Senior Loan Officer Opinion Survey on Bank Lending Practices conducted by the Federal Reserve. The change, however, is modest and concentrated on large banks lending in categories particularly affected by competitive pressures. The Fed defines large banks as those with more than $50 billion in assets and small banks as those with annual sales under $50 million. Fifty-seven domestic banks and 23 US branches of foreign banks responded to the quarterly survey.
Loosening of lending requirements was most pronounced in the area of commercial and industrial (C&I) loans. Residential lending was only modestly improved, with nearly as many banks reporting they had tightened credit as had loosened it.

Massive Taxpayer Liability or Somewhat More Expensive Mortgages For Everyone? Hmm, I'll Have to Think About That...
Peter Suderman - Reason.com
Policymakers in Washington held a confab yesterday over the head-scratching question of what to do about government-owned mortgage giants Fannie Mae and Freddie Mac. Discussions like these can sometimes be wonky and impenetrable, but, as this brief passage from The Washington Post's summary of the conference shows, the heart of the debate is actually fairly easy to grasp:
Bill Gross, who runs the world's biggest bond firm, Pimco, argued that the mortgage market should be completely nationalized...Gross's proposal could ensure that mortgages remain affordable for home buyers. That's because the government, which would borrow money to finance the mortgages, faces a relatively low interest rate in the markets. The downside is that taxpayers would be on the line for losses.

Are Federal Employees Compensating for Something?
By The Mogambo Guru - The DailyReckoning.com
08/18/10 Tampa, Florida - The US Bureau of Economic Analysis, an "official" source of news, reported what everybody has already known: Government worker compensation in now an average of more than $120,000, or about twice as much as the average private sector worker making less than $60,000.
I find this particularly interesting because I get a chance to answer some of my critics, who say to me, "Bah! Even though you are absolutely right about the foul Federal Reserve and how their continually creating more and more money is going to ignite an inflation in prices that will destroy us, and you are entirely correct that buying gold, silver and oil are terrific bargains right now because of it, and you are completely spot-on that Obama and Congress are repugnant socialist morons, but you are not as handsome as you think you are, and a lot more stupid, too. And lazy. For instance, you never do any real work."

Jobless millions signal death of the American dream for many
Paul Harris - The Observer - Guardian.co.uk
Even the criminals have fallen on hard times in America's poorest city as the long-term unemployed struggle to keep a grasp on normality
Richard Gaines is one of the best-known faces on Camden's Haddon Avenue. It is a rough-and-tumble street, lined with cheap businesses and boarded-up houses, and is prey to drug gangs. Gaines, 50, runs a barbershop, a hair salon and a fitness business. He works hard and is committed to his community. But Haddon Avenue is not an easy place to make a living in the best of times. And these are far from the best of times.
Just how badly the great recession has struck this fragile New Jersey city, which is currently the poorest in America, was recently spelled out to Gaines. In happier times - whatever that might mean for a city as destitute as Camden - local businesses on Haddon Avenue could at least rely on a bit of trade from those who made their money on the street.

Food Stamps or Paychecks?
by Newt Gingrich - HumanEvents.com
In the 2008 campaign, President Obama gave us all a hint of his socialist leanings when he promised to Joe the Plumber that he would "spread the wealth around." Last week, we found out that his policies and those of the Democrats are delivering on that promiseÉalthough probably not in the way they expected.
The use of food stamps hit a record high in May 2010, according to the U.S. Department of Agriculture, with 40.8 million Americans receiving Supplemental Nutritional Assistance Program (SNAP) subsidies for food purchases. This is more than one-eighth of the population.
Worse, the USDA projects the number of Americans using food stamps will rise to 43.3 million in 2011.

Schwarzenegger Orders Furloughs After Top Court Rules
By Michael B. Marois
Aug. 18 (Bloomberg) -- California Governor Arnold Schwarzenegger said 150,000 government workers must begin taking time off without pay starting Aug. 20 following a court ruling lifting an injunction temporarily blocking the furloughs.
The California Supreme Court, saying it would review the governor's plan, stayed decisions by lower courts that had halted the furloughs. Schwarzenegger directed state workers to take three unpaid days off each month to save cash. The high court set a Sept. 8 hearing on a challenge to the order.

California Budget Logjam May Lead to IOUs Next Month
By Michael B. Marois
Aug. 18 (Bloomberg) -- California may begin paying bills with IOUs in September for a second year in a row as a legislative logjam over erasing a $19 billion deficit prevents passage of a budget.
State Controller John Chiang said the IOUs may be issued in two to four weeks if the budget impasse persists. The warrants will pay for everything from contracted services to health-care clinics so California can preserve funds to make payments on priority items such as bonds.

US says it is not illegal for schools to spy on students at home
Nick Farrell - TheInquirer.net
IT LOOKS LIKE PROSECUTORS are not going to get involved in the bizarre case of the school which switched on laptops to spy on students while they were in their own bedrooms.
US Attorney Zane David Memeger told USA Today, investigators had found no evidence of criminal intent by Lower Merion School District employees who activated tracking software that took thousands of webcam and screenshot images on school-provided laptops.
A student and his family sued the district in February, claiming officials invaded his privacy by activating the software and the civil case is ongoing.
The school has admitted that it captured 56,000 screen shots and webcam images mostly so it could find missing student laptops. But in the case of this student the school appears to have been using the laptops to investigate home drug use.

USDA Rural Housing Program: Where's the Funding?
by Jann Swanson - MortgageNewsDaily.com
When the USDA ran out of money for its Section 502 guaranteed Rural Housing product in April, the program effectively shut down. At that time it was up to the Congress to appropriate the $150 million needed to continue the program through the September 30 end of the fiscal year. A month later, even though the legislation intended to provide the funding had not passed, USDA began issuing commitments for new loans, but there was a caveat: Loan approvals would be "subject to the availability of funds and Congressional authority to charge a 3.5 percent guarantee fee for purchase loans and a 2.25 percent guarantee fee for refinance loans."

California broadband projects pick up $205 million in federal funding
LATimes.com
Rural California will become a little more wired.
California will receive over $205 million in American Recovery and Reinvestment Act funds for seven projects aimed toward bringing fast broadband Internet access to rural and remote communities in the state.
The grants are part of the $1.8 billion in Recovery Act funds announced today by Vice President Joe Biden. The grants were awarded to 94 broadband projects in 37 states.

Fannie's Cozy Ties to Countrywide
by Valerie Richardson - HumanEvents.com
The Obama Administration managed to move financial regulatory reform in July with almost no mention of Fannie Mae and Freddie Mac, a feat that could be likened to cracking down on fast food without mentioning McDonald's. But the latest revelations about the federally backed mortgage giants could give even the most hardened everyone-deserves-a-house-they-can't-afford Democrat pause.
It turns out that Fannie Mae officials weren't just doing business with the execs at Countrywide Home Loans, they were actively schmoozing them. An internal Fannie Mae "Customer Engagement Plan" issued in 2004 outlines strategies designed to "deepen our relationship at all levels with Countrywide," including squeezing into the same foursome at golf tournaments.

Sowing The Seeds Of Starvation
by John Myers - PersonalLibertyDigest.com
"One death is a tragedy; one million is a statistic." - Joseph Stalin
This summer's searing heat has put a fire beneath grain prices. But worse than another round of inflation is the potential for widespread famine, particularly in the former Soviet Union, which has been beset by the worst heat wave in 130 years.
The Ukraine is no stranger to starvation. The Terror-Famine struck the Ukraine in 1932-33 when as many as 10 million starved. It should come as little surprise that Joseph Stalin was the architect of that tragedy.
In the 1920s, Lenin proved his political savvy and made concessions to the peasantry. This led to The New Economic Policy (NEP) and a rethinking by the Kremlin.

GM Files for IPO That Will Reduce Treasury's Stake
By David Welch and Michael Tsang
Aug. 18 (Bloomberg) -- General Motors Co. filed for an initial share offering that will mark the return of what was once the world's largest automaker to public markets a year after it was bailed out by the government.
GM, 61 percent owned by the U.S. Treasury, didn't disclose the number of shares that will be sold in the initial public offering or the price in a statement filed with the Securities and Exchange Commission. The automaker will not sell any common shares itself while offering preferred shares alongside the IPO, the filing showed. The government will sell some of the common shares it owns in GM, according to the filing.

General Motors back from the brink and set for $20bn flotation
Andrew Clark in New York - The Guardian
Share offer comes a year after filing for bankruptcy and will allow some of state loan to be repaid
America's biggest carmaker, General Motors, has taken the first step towards a stock market flotation barely a year after struggling through bankruptcy, in a move that will allow Barack Obama's government to win political capital by recouping some of the billions in public money pumped into the company.
GM last night filed an official application, called an S-1 document, with the Securities and Exchange Commission that paves the way for one of the largest public share offerings in US history. GM did not reveal the pricing of its shares, but the company is likely to seek to raise between $10bn (£6.4bn) and $20bn in capital.

General Motors Files for an Initial Public Offering
By NICK BUNKLEY and BILL VLASIC - NYTimes.com
DETROIT - General Motors filed Wednesday for a landmark public stock offering that would let the federal government begin selling off its stake in the automaker as well as raise money for G.M.'s turnaround.
G.M. said that it would offer both common stock and preferred stock in the offering, which could begin as early as October, when the Obama administration will be seeking to portray its aid to the auto industry as a success before midterm elections in November.
The common shares will be sold by G.M's current shareholders, the largest of which is the federal government. It exchanged about $43 billion in aid to G.M. for a 61 percent interest in the automaker.

Where adults must always buckle up
Half the states require that all adults in a vehicle wear seat belts. In all states, children must be in restraints. - [see map]
States expand seat belt laws to cover rear-seat riders
States are moving to close a deadly gap in seat belt laws that allows rear-seat, adult passengers in half the states to ride legally without buckling up.
Six states - Indiana, Kansas, Louisiana, Minnesota, New Jersey and Texas - have expanded their seat belt laws to cover rear-seat occupants since 2007, according to the Insurance Institute for Highway Safety.
Twenty-five states and the District of Columbia require seat belts for all passengers. "The most important thing you can do in any vehicle at any time is wear your seat belt in all seating positions," says Michele Fields, general counsel at the Insurance Institute. "The gaps with regard to children younger than 16 have almost all been closed. But there are still gaps for adults."

Is the Web Dead? No. But It's at Risk
By SAM GUSTIN - DailyFinance.com
Want to kill the web? There's an app for that.
Wired magazine sure picked a good time to declare "the Web is dead" and herald the foreboding rise of the "Internet" -- by which it means a newly powerful, vaguely malevolent, premium-services-based online world with competing content fiefdoms, controlled by powerful corporate interests.
Wired's vision is prescient because it fits well with what Google (GOOG) and Verizon (VZ) seem to be proposing with their recently announced net neutrality compromise, if the worst of the pessimists' fears are realized. (Net neutrality is the basic concept that broadband providers can't pick winners and losers on the Web or discriminate against rival content.)

Florida May Seek Billion-Dollar BP Payment to Plug Budget Gap
By Jim Snyder
Aug. 18 (Bloomberg) -- Florida may ask BP Plc for an emergency payment of more than $1 billion to plug a hole in its budget after the largest U.S. oil spill, and neighboring Gulf Coast states are weighing their options.
Steve Yerrid, a Tampa lawyer chosen by Florida Governor Charlie Crist to advise him on legal issues concerning the spill, said the state may seek an initial payment in the "lower range" of billions of dollars to make up for lost tax revenue.
"We're hoping rather than jobs being sacrificed or services to Floridians being lost, that we can develop some type of dialogue to get interim relief until state claims can be properly calculated," Yerrid said in a phone interview yesterday.

Collapsing Marsh Dwarfs BP Oil Blowout as Ecological Disaster
By Ken Wells
Aug. 18 (Bloomberg) -- Claude Luke throttles down his 21- foot aluminum work boat. Off to the left, the snout of an alligator disappears near the mouth of a watery gash in the Louisiana marshland.
The 51-year-old Cajun crab fishermen is touring the epicenter of an unfolding environmental disaster that dwarfs the BP Plc spill and predates it by decades, according to state scientists and environmentalists. If unchecked, the destruction threatens to undermine the world's seventh largest estuary and one of the most important U.S. energy corridors.

Tea Party Border Rally Draws Mexican Observers
by Robert M. Engstrom - HumanEvents.com
Editor's Note:
Bob took a lot of great pictures at the rally. They are compiled here for easier viewing.
While Americans attending the United Border Coalition's rally at the border gathered in 100 degree temperatures on a ranch next to the Arizona/Mexican border Sunday, it was clearly visible that illegal border crossers have not been discouraged by SB 1070.
On a hillside less than a mile into Mexico, a group of observers appeared.
There was an earful for the English speakers in the group across the border. Former Rep. J.D. Hayworth and more than a dozen conservative political candidates and Arizona Sheriffs Joe Arpaio of Maricopa County and Cochise County's Larry Dever lambasted the Obama Administration's handling of border security and illegal immigration.

Drones Surge, Special Ops Strike in Petraeus Campaign Plan
By Spencer Ackerman - Wired.com
KABUL, Afghanistan - Ever since the Afghanistan war became a counterinsurgency fight, critics have charged that commanders' cautions about using force only inhibit the fight against the Taliban. But in the shadows, NATO Special Operations Forces are engaged in an intensely lethal war of their own.
According to information provided to Danger Room by Gen. David Petraeus, the top NATO commander in Afghanistan, in just the past 90 days these elite units have captured or killed 365 militant leaders, detained 1,335 insurgent foot soldiers and killed another 1,031 insurgents on top of that.

Where will China's long march end?
By Peter Foster - FT.com
China has gone past Japan to become the world's second largest economy, and is closing in on the United States. But it faces challenges ahead
It's official. Dice the data any way you please, China has now eclipsed Japan as the world's second-largest economy. And if it keeps up its current rate of double-digit, pell-mell growth, it will surpass the US as the world's largest economy by 2020.
Of course, these are artificial benchmarks: if you take into account China's "grey market", its economy passed Japan's some time back. But almost every day seems to provide more evidence of how far and how fast China's rise is reshaping the world, to offer more reasons to believe that China's emergence as a world power is inexorable and inevitable.

*****
Timely interview with Jeri Corsi on possible attack of Iran. Will the world stand at the brink of WWIII?

Coast to Coast AM - 1 of 3 Attack on Iran
George Noory interviews Jerome Corsi

Coast to Coast AM - 2 of 3 Attack on Iran
George Noory interviews Jerome Corsi

Coast to Coast AM - 3 of 3 Attack on Iran
George Noory interviews Jerome Corsi

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Archived Page Link
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Wednesday 08.18.2010

The Undoing of a Legislative President
By MATT BAI - NYTimes.com
Democrats in Washington are divided and somewhat puzzled over President Obama's fading popularity. They reject, of course, the Republican view that the president is basically a closet Socialist whose disdain for free enterprise has alienated voters. But that's about as far as the consensus goes.
In conversations over the past few weeks, some of the party's leading strategists told me that it all comes down to messaging, or - here’s that ubiquitous word again - "framing." The president who ran such a brilliant campaign, they argue, has utterly failed to communicate his successes. They cited factors like the president’s cool demeanor and suggested that he hadn’t used the right words or shown the proper empathy.

The Purpose Behind Engineered Economic Collapse
By Giordano Bruno - Neithercorp Press
"From now on, depressions will be scientifically created." - Congressman Charles A. Lindbergh Sr. , 1913
Everyone loves money. Even people like myself who abhor the abuse of money and commerce, who understand the fraudulent nature of the system we live in, still work hard and save so that we might attain a sense of stability within that system. Many people see money as a focal point to their existence. But is it really money that they are after, or is it something else entirely? In truth, money represents 'security' in the minds of the masses. Money affords us the ability to survive, and the more of it we have, the safer we all feel. Because we subconsciously associate the extension of our very life with the variable health of the economic structure in which we live, we tend to become unwitting devotees to its continued existence, even if it is corrupt and condemned to failure. We gullibly deny the system or the currency that supports it is doomed to the contrary of all evidence because, even though it has beaten us bloody, we have never known anything else.

DC Politicians Beware: Voters Want the Employment Crisis Fixed --
If You Mess with Social Security or Deficits, You're Toast
By Joshua Holland - Alternet.org
A new survey finds a huge majority of Americans are in agreement about our biggest problem. Obama and the Dems better listen up.
Even while the politicians and pundits keep telling us that the federal deficit is a huge and pressing problem, a new public opinion survey finds that a majority of American voters have their own view of what deficits mean to our economy, and how best to deal with our economic woes. They favor progressive strategies for bringing the deficit beast to heel, and a healthy majority rejects the Right's preferred course of balancing the budget on the backs of the elderly and infirm.

D.C.'s Idea of Fiscal Restraint
By Cong. Ron Paul
Texas Insider Report: WASHINGTON, D.C. -
.... One such disaster-waiting-to-happen is one of the revenue generating provisions used to claim that the healthcare reform bill was "paid for". $17 billion in additional tax revenues is supposed to come from an onerous new IRS reporting requirement that any taxpayer with business income who spends over $600 in one year with one business will have to report those expenditures to the IRS.
Mind you, this is a cumulative total of $600 in transactions in one year. This will involve so much extra accounting and paperwork that the IRS claims it will be unable to deal with it effectively, and even the American Institute of Certified Public Accountants (to whom it should be a boon) has come out against it!
Apparently they realize they will actually lose customers, especially small businesses, to bankruptcy because of this!
Gold dealers are especially alarmed by this provision, as most of their transactions easily top $600. This represents a significant outlay of time and paperwork and no additional revenue for businesses with which to hire people.

'Israel has days to strike Bushehr'
By HILARY LEILA KRIEGER - JPost.com
Bolton: Russia to load fuel into reactor on Saturday.
WASHINGTON – Israel has only mere days to launch an attack on Iran’s Bushehr nuclear reactor if Russia makes good on its plan to deliver fuel there this weekend, former US ambassador to the UN John Bolton warned Tuesday.
He said that once Russia has loaded the fuel into the reactor -- slated for Saturday – Israel would no longer be willing to strike for fear of triggering widespread radiation in an attack.
"This is a very, very big victory for Iran" Bolton told The Jerusalem Post. "This is a huge threshold."

Obama Bombing Iran? Don't Be Surprised
The Atlantic.com
This post is part of our forum on Jeffrey Goldberg's September cover story detailing the prospects and implications of an Israeli strike against Iran.
Jeffrey Goldberg's main subject is an Israeli strike on Iran's nuclear program, but in his final paragraphs he turns to whether President Obama might act instead. Jeffrey says he used to believe there was no chance -- but now he thinks there might be. I agree, for reasons political and philosophical.
Two years ago, in July 2008, Obama said this in Berlin:
Now is the time to join together, through constant cooperation, strong institutions, shared sacrifice, and a global commitment to progress, to meet the challenges of the 21st century .... This is the moment when we must renew the goal of a world without nuclear weapons. The two superpowers that faced each other across the wall of this city came too close too often to destroying all we have built and all that we love. With that wall gone, we need not stand idly by and watch the further spread of the deadly atom. It is time to secure all loose nuclear materials; to stop the spread of nuclear weapons; and to reduce the arsenals from another era. This is the moment to begin the work of seeking the peace of a world without nuclear weapons.

Ahmadinejad feels the heat at home
By Mahan Abedin - Asia Times Online
In a sure sign that Iran's factionalized politics is making a comeback, the right-wing and conservative forces that last year engineered the marginalization of the reformists, are slowly splintering. At the center of this latest bout of factional in-fighting is the divisive personality of President Mahmud Ahmadinejad.
While few people expected the political scene to be dominated by a unified conservative front for long, the speed at which the right-wing factions are dividing between pro- and anti-Ahmadinejad camps has caught many analysts by surprise.

Iran to test-fire new missiles on Aug. 22
Tehran Times Political Desk
TEHRAN - The Iranian armed forces will test-fire new missiles on August 22, which is the national Defense Industry Day.
The new generation of Qiam (Uprising) missiles and the third generation of Fateh (Conqueror) missiles will be tested on this day, Defense Minister Ahmad Vahid told reporters at a press conference in Tehran on Tuesday.
Iran will also unveil its first domestically manufactured long-range unmanned aerial vehicle (UAV), called the Karrar, on August 22, Vahidi stated.
Iran inaugurated the production line of two reconnaissance UAVs in February.

This phoney finger-wagging won't talk Iran out of nukes
Lionel Shriver - guardian.co.uk
Drop the moral posturing, Hillary - US hypocrisy will be all too clear in Tehran. Only realpolitik can halt their nuclear ambitions
This weekend Russian specialists will begin loading low-enriched uranium fuel rods into Iran's Bushehr reactor, the initial step in getting its first nuclear power plant up and running. Though Hillary Clinton, the US secretary of state, has criticised the irreversible startup as "premature", Bushehr is in fact a long-delayed fiasco predating the Iranian revolution. By contract, the spent fuel rods, containing weapons-grade plutonium, are to be returned to Russia. Uneasy faith that Iran will keep its promise, if only because it still lacks the technology to process the rods at home, is the sole reason that America and its allies are not hysterical. Whether nominally safe or not, Bushehr foreshadows Iran's more ominous nuclear plans, which the Obama administration's hectoring and cajoling have signally failed to discourage.

22 cities in danger of a double-dip recession
By Hibah Yousuf,
[But not where you might expect]
NEW YORK (CNNMoney.com) -- The chance of a national double-dip recession is hotly debated amid an increasing number of signs that the economic recovery is losing pace, but the risk is particularly troublesome on a local level.
A new report from Moody's Economy.com singled out 22 cities that are at risk of slipping back into a recession in as early as three months. To come to this conclusion, the economists considered dwindling progress in employment, housing starts, home prices and industrial production. (See the map above for the full list.)

US Says Bankruptcies Reach Nearly 5-Year High
By Reuters via CNBC.com
U.S. bankruptcy filings have reached the highest level since 2005, government data released on Tuesday show, as the economy slows and the unemployment rate hovers just below double digits.
There were 422,061 bankruptcy filings between April and June, according to the Administrative Office of the U.S. Courts, up 9 percent from 388,148 in the prior three-month period, and up 11 percent from 381,073 a year earlier.

Gold, headlines, and hot money in inflation mode
Short-term investors shed deflation views, bonds differ
NEW YORK (MarketWatch) -- It only took producer prices rising for the first time in four months and news that another hedge fund was piling into a gold exchange-traded fund for inflation to make its big comeback -- at least in media headlines and, perhaps, at summer cocktail parties where the hot-money crowd gathers.
Eton Park Capital Management LP, a hedge fund, started us off on Monday with a regulatory filing that revealed it took a big stake in the SPDR Gold Trust ETF in June.
In many outlets, the move was portrayed as another hedge fund joining in the big inflation bet: All that government spending and currencies going down will have to lead to inflation eventually, right?

The Point of No Return
BY JEFFREY GOLDBERG - TheAtlantic.com
For the Obama administration, the prospect of a nuclearized Iran is dismal to contemplate- it would create major new national-security challenges and crush the president's dream of ending nuclear proliferation. But the view from Jerusalem is still more dire: a nuclearized Iran represents, among other things, a threat to Israel's very existence. In the gap between Washington's and Jerusalem's views of Iran lies the question: who, if anyone, will stop Iran before it goes nuclear, and how? As Washington and Jerusalem study each other intensely, here's an inside look at the strategic calculations on both sides - and at how, if things remain on the current course, an Israeli air strike will unfold.

Thomas Sowell:
Obama has already brought 'change' to America
By: Thomas Sowell - Washington Examiner
One of the few campaign promises that President Obama has kept was this: "We are going to change the United States of America!"
As in many other cases, those who were thrilled by the thought of "change" seldom seemed to consider whether it would be a change for the better or for the worse. True believers in the Obama cult assumed that it had to be a change for the better.
Now it is slowly dawning on more people that it is a change for the worse-- runaway government spending, under the banners of "stimulus" and "jobs," is not stimulating anything except political pay-offs to special interests. As for jobs, the percentage of the population with jobs keeps on declining, even as the administration points to all the jobs it is creating.

Federal Reserve's shift in policy doesn't change its basic outlook
By Neil Irwin - Washington Post Staff Writer
After the Federal Reserve's policy meeting last week, the drumbeat on Wall Street and among some economists for bold new steps to strengthen the economy got louder.
Don't hold your breath.
The Fed's move last week to make its monetary policy more supportive of growth was a reversal after a year in which the central bank backed away from unconventional steps to stimulate the economy.
Although last week's action reflects a deepening concern at the Fed over the sluggish pace of growth, policymakers remain reluctant to undertake broader efforts to stimulate the economy, viewing their policy tools as uncertain to be effective.

Monkeying Around
By Ralph R. Reiland - The American Spectator.org
Remember those stories about Nero playing the fiddle while Rome burned?
Actually, if he was really playing, it was probably a lyre, a small harp-like stringed instrument. Fiddles weren't around yet.
Well, showing how little the art of governance has improved, we're now borrowing money from China to buy cocaine for monkeys, calling it a jobs program, and running up the national debt to $14 trillion.
Or, perhaps worse, President Obama might get the money here at home for his failing jobs programs by grabbing even more money out of the pockets of America's key job creators.

Warning, bear market 2010: 11 'sells.' Only 6 'buys'
New Normal: Bankrupt nation. Deflation. Zeros. Junk. No jobs. Depression
By Paul B. Farrell, MarketWatch
ARROYO GRANDE, Calif. (MarketWatch) -- Yes, it's going to get worse, a whole lot worse ... Bill Gross warns this is the "New Normal. Forget 10% returns. Think 5%". ... Economist Larry Kotlikoff, author of The Coming Generational Storm, warns: "Let's get real. The U.S. is bankrupt. Neither spending nor taxing will help the country pay its bills" ... Economist Peter Morici warns: "Unemployment is stuck near 10%. Deflation coming. Stock market threatens collapse. The Federal Reserve and Barack Obama are out of bullets. Near zero federal funds rates, central bank purchases, a $1.6 trillion deficit have failed to revive the economy." ... Simon Johnson, co-author of 13 Bankers, warns: "We came close to another Great Depression, next time we may not be so lucky." Why? Because Wall Street's already well into the next bubble/bust cycle -- the "doom cycle."
Warning: More bad news ahead. Welcome to a bleak second half 2010, worse for 2011.

Rick Santelli asks Ron 'Who created the Federal Reserve?"
and mentions Jekyll Island

Gross Urges 'Full Nationalization' of Housing Finance
By Lorraine Woellert and Rebecca Christie
Aug. 17 (Bloomberg) -- Bill Gross, who runs the world's biggest bond fund at Pacific Investment Management Co., said the U.S. should consider "full nationalization" of the mortgage- finance system as the Obama administration plots the revival of a market that was at the center of the 2008 credit crisis.
"To suggest that there's a large place for private financing in the future of housing finance is unrealistic," Gross said today at a U.S. Treasury Department conference in Washington. "Government is part of our future. We need a government balance sheet. To suggest that the private market come back in is simply impractical. It won't work."

Bill Gross Discusses Financing of U.S. Housing Market [video]

Debt Virus Spreads During Make-Believe Recovery
Commentary by Matthew Lynn
Aug. 17 (Bloomberg) -- The euro area is growing again. The banking system has survived its stress tests. The Greeks have implemented their first austerity measures with some success.
The fevered predictions of the early summer that the euro was doomed, and that Europe's sovereign-debt crisis would rip through countries such as Spain and Portugal like a virus, have been forgotten. The crisis appears to be over.
Don't believe it. Under the surface, the cracks in the euro are getting worse. The imbalances in the euro area are growing all the time. The resistance to the bailout package will rise as the terms turn out to be immoral and absurd. And the big-deficit nations are locked in a downward economic spiral.

Our One-Term President
By Tom Bethell - The American Spectator.org
It's a good bet right now that Barack Obama will be a one-term president. The enthusiasm that once shielded this hyphenated American has dissipated. His supporters, although still numerous, have discovered that he lacks Bill Clinton's centrist instincts, and even his charm. The anti-Bush mania that swept the country from 2006-09 finally burned itself out.
It's always possible that the Republicans will nominate a dud. That has happened so often that it should even be considered likely. Not since 1980 has there been an outstanding GOP candidate. But at this stage it's too difficult to predict the 2012 nominee, so I'll drop that subject.

Layoff fears still grip one in four U.S. workers
LATimes.com
More than one-quarter of American workers still live in fear that they will be laid off from their jobs, and nearly 40% remain worried about possible cuts in their benefits, a new Gallup poll shows.
Those percentages are down from a year ago but still sharply higher than they were before the deep recession hit in 2008.
The poll of 1,013 full- and part-time workers, conducted Aug. 5 to 8, found that 26% are worried that they could lose their jobs in the near future.
By contrast, 31% of workers polled by Gallup in August 2009 were concerned about being cut. So the economy's recovery this year has reduced some Americans' fears of becoming jobless.

Forget the Hype: U.S.-Mexico Border Area Is One of Safest Regions in U.S. By Elena Shore - Alternet.org
Much of the fear of border violence comes from people who live away from the border. Those who live near it actually feel safer, an observation corroborated by a recent study.
Crime along the U.S.-Mexico border has been cited to justify everything from Arizona's new immigration law to Congress's decision Tuesday to spend another $600 million on border enforcement. Arizona Governor Jan Brewer has referred to "mayhem" and "headless bodies" found along the border, while Sen. John McCain said that the failure to secure the border "has led to violence -- the worst I have ever seen." And when asked why they supported Arizona's immigration law, SB 1070, many Americans cited security reasons and an increase in violent crime along the U.S. border.
But a new poll says that this is a myth. There has been no increase in violent crime on the U.S. side of the border. In fact, reports show that the U.S. border is getting safer.

Crude Oil, Equities likely to relief bounce
By Chris Vermeulen
Last week was exciting as investments rocketed higher or tank ... We saw Gold and the US Dollar pop while oil and equities dropped sharply with heavy volume.
Just to recap, Wednesday the market went into freefall mode sending traders and investors running for the door. This was obvious from looking at the large percent drop coupled with heavy selling. That day the NYSE showed panic selling with 37 shares sold for every 1 share purchased meaning pure panic. In my Wednesday night report "How to Take Advantage of Panic Selling for SP500 and Gold " I explained how to read these extreme market conditions and what to expect the following sessions.

Why China's Housing Bubble Will End Badly
By CHARLES HUGH SMITH - DailyFinance.com
Imagine that your local city and county controlled all land rights, and the only ownership a private builder or developer could secure was a long-term lease. Now imagine that 40% of the city and county's revenues come from the lease fees paid by developers. Next, imagine a giant real estate bubble has priced most residents out of the market, and that the local governments are reaping huge gains as the development rights and leases they sell are skyrocketing.
Can you say conflict of interest?

The worst bet in real estate today: Construction loans
By Paul Wiseman, USA TODAY
The biggest bank killer around isn't some exotic derivative investment concocted by Wall Street's financial alchemists. It's the plain old construction loan, Main Street banks' bread and butter for decades.
Deutsche Bank has called them "without doubt, the riskiest commercial real estate loan product." The Congressional Oversight Panel, a financial watchdog, has warned that construction loans have deteriorated faster and inflicted bigger losses on banks than any other real estate loans.

Fannie, Freddie should stay big, banking execs say
By Alan Zibel, AP Real Estate Writer
WASHINGTON - The Obama administration invited banking executives Tuesday to offer advice on changing the government's role in the mortgage market. Their response: Stay big.
While executives disagreed on the exact level of support needed, the group overwhelmingly advocated that the government should maintain a large role propping up the nearly $11 trillion market.
Bill Gross, managing director of bond giant Pimco, said the economic recovery required more government stimulus, particularly in the housing market. He suggested the administration push for the automatic refinancing of millions homes backed by mortgage giants Fannie Mae and Fannie Mac.

What's The Future For Fannie, Freddie, and Your Home Mortgage?
By Linda Stern - CBS MoneyWatch
The Federal government will continue to support housing in the future, but that support may be smaller than it was in years past, according to top Obama Administration officials. Their remarks came at a Treasury Department summit today on housing finance, convened as new data was released showing continued weakness in housing starts, building permits, and builder confidence.

Four Ways to Fix Fannie and Freddie
By: John E. Taylor - CNBC.com
As the Obama administration hosts a conference of a select group of housing experts on Tuesday to address the role that Fannie Mae and Freddie Mac will play in the housing market, we should remember that homeownership's promise was ruined by Wall Street's recklessness, not by federal policy.
On Monday, I told CNBC that homeownership is still a good investment for some and can be again for most Americans, if the housing market has adequate oversight.
That's because before Wall Street ravaged our economy by aggressively marketing bad loans and stuffing them into "innovative" products that they sold to investors and then bet against, homeownership was a good way for the middle class to build wealth and for lower-income families to move into the middle class.

FHA has become the new toxic lender of first resort
4 out of 10 loans made in expensive Southern California are FHA backed. FHA now backing apartments in Manhattan with a price tag of $820,000 to $3 million with a 3.5 percent down payment.
DoctorHousingBubble.com
The Federal Housing Administration (FHA) was created in 1934 during the Great Depression to give low to moderate income Americans a chance at pursuing the American dream of homeownership. Even in the best of times, the FHA was only a small fraction of the mortgage market as it was never intended to be a big player. Today the FHA now backs 30 percent of all loans outstanding and is quickly burning through its reserves. You would think that the FHA would try going back to its core mission of helping those it initially set out to help. Instead, it is now being used as a backend tool to fund absurd mortgages that don't fit into any other current government loan programs.

We are subsidizing luxury apartments in Manhattan
Manhattan Luxury Condos Embrace FHA in 'Game Changer'
By Oshrat Carmiel
Aug. 13 (Bloomberg) -- Whitney Gollinger, marketing chief for a Manhattan condo building with an outdoor movie theater and panoramic city views, is highlighting a different amenity to spur sales: the financial backing of the federal government.
The Federal Housing Administration agreed in March to insure mortgages for apartments at the 98-unit Gramercy Park development, known as Tempo. That enables buyers to make a down payment of as little as 3.5 percent in a building where apartments are listed at $820,000 to $3 million.

Special report:
Flipping, flopping and booming mortgage fraud
By Nick Carey - Reuters.com
(Reuters) - The house on the 53rd block of South Wood Street in Chicago's Back of the Yards doesn't look like a $355,000 home. There is no front door and most of the windows are boarded up.
Public records show it sold in foreclosure for $25,500 in January 2009, then resold for $355,000 in October. In between, a $110,000 mortgage was taken out on the home, supposedly for renovations. This June, the property went back into foreclosure.
To Emilio Carrasquillo, head of the local office of non-profit lender Neighborhood Housing Services of Chicago (NHS), the numbers don't add up. He believes this is a case of mortgage fraud.

Gold hovers above $1225 on economic worries
SINGAPORE (Commodity Online) : Gold remained higher in Asian trade Tuesday, on global economic concerns, despite losing some of its gains in early trade.
Gold for immediate delivery was seen trading at $1225.18 an ounce at 12 noon Singapore time while U.S. gold futures for December delivery was at $1,226.7 an ounce on the comex division of Nymex.
Analysts said the precious yellow metal took advantage of weak economic growth around the world that might lead to deflation.

City of Bell lent employees, elected officials nearly $900,000
By Jeff Gottlieb, Kimi Yoshino and Ruben Vives, Los Angeles Times
Former assistant city manager received at least $200,000. Experts say such a city loan program for employees is unusual.
The city of Bell gave nearly $900,000 in loans to former City Administrator Robert Rizzo, city employees and at least two council members in the last several years, according to records reviewed by The Times.
The documents show that Bell's former assistant city manager, Angela Spaccia, received two loans of at least $100,000 each and that council members Oscar Hernandez and Luis Artiga received $20,000 loans. Rizzo, whose huge salary sparked a scandal that forced him and other city officials to step down, received two loans for $80,000 each, city officials said.

Auditors Say Colorado Pension Plan Recovering
CBSNews.com
Auditors Say Colorado Pension Plan On Road To Recovery After Cutting Cost-of-living Increases
(AP) DENVER (AP) - Colorado's pension fund is back on track toward solvency after state lawmakers became the first in the nation to cut retiree benefits to prevent its pension system from going broke, auditors said Monday.
The next few years may be bumpy, however, because of losses from 2008 that are still being absorbed by the pension fund.
Thomas Cavanaugh, an actuary for Cavanaugh Macdonald Consulting, told lawmakers that they would have to spend 40 percent of state payroll on retiree benefits if the pension system runs out of money.
"Your assets over 30 years would get to the point where it's fully funded. If there were no money at all, you'd be looking at 40 percent of payroll," Cavanaugh told lawmakers on the Legislative Audit Committee

'Vultures' Save Troubled Homeowners
By JAMES R. HAGERTY
Anna and Charlie Reynolds of St. George, Utah, were worried about losing their home to foreclosure last year. Then they got a lucky break - from an unlikely savior.
Selene Residential Mortgage Opportunity Fund, an investment fund managed by veteran mortgage-bond trader Lewis Ranieri, acquired the loan at a deep discount and renegotiated the terms with the Reynolds. The balance due was cut to $243,182 from $421,731, and the interest rate was lowered. That reduced the monthly payment to $1,573 from $3,464, allowing the family to stay in their home despite a drop in Mr. Reynolds' income as a real-estate agent. "It was a miracle," says Ms. Reynolds.

Geithner: Housing system needs government support
HUD chief Donovan urges reduced Washington involvement in mortgages By Ronald D. Orol, MarketWatch
WASHINGTON (MarketWatch) -- Without government backing for the housing finance system, future economic downturns could be harsher, Treasury Secretary Timothy Geithner said Tuesday at a conference on the future of housing finance.
"Without such support, the risk is that future recessions could be more severe because the financial system would not have the capital to support mortgage lending on an adequate scale," Geithner said.

Bank repossessions at record high
By Jay Heflin - TheHill.com
Bank repossessions of homes hit a record high during the second quarter, with over 260,000 properties returning to lenders, according to Foreclosure-Support.com, which analyzes home foreclosures.
The figure is up 5 percent from the previous quarter and up 38 percent from the second quarter last year.
Bank repossessions occur after a home has been in foreclosure for quite some time.

Nationwide foreclosure activity jumps by 12,000 from June to July. One in 397 received a foreclosure filing during the month of July.
DoctorHousingBubble.com
In a sign that things are slow going in the housing market, foreclosure notices jumped nearly 4 percent from June to July. Over 325,000 housing units received a foreclosure filing in the month of July. This elevated level demonstrates that the housing market is still far from any sort of reasonable recovery especially with numerous troubled mortgages floating out in bank balance sheets. Keep in mind this high elevated amount of foreclosure activity comes at a time when the government has stepped up programs to h