If all printers were determined not to print anything till they were sure it would offend nobody, there would be very little printed. -- Benjamin Franklin
In a new appeal to the Christian right, Newt Gingrich told OneNewsNow that President Obama's proposed changes to the charitable deduction for top earners amounts to a "war against churches and charities," deliberately designed to discourage the successful from donating money to churches and make us all dependent on the government.Lowering the tax breaks on charitable contributions only for the wealthiest Americans is somehow a war on God, Jesus, Buddha, and the Flying Spaghetti Monster. His delusions are fascinating."I think there's a clear to desire to replace the church with a bureaucracy, and to replace people's right to worship together with a government-dominated system," said Gingrich.
The proposal itself is to lower the deduction that people making over $250,000 receive for itemized charitable contributions, from its current 33% or 35% down to 28%. Obama has defended the proposal by saying: "I'm assuming that that shouldn't be the determining factor as to whether you're giving that $100 to the homeless shelter down the street."
Here's the logical (read: nuts) conclusion to the fast-growing Poor-Ted-Stevens movement:My full statement is as follows: Alaskan Republicans are clinically insane.Via Think Progress, a press release from the Alaska GOP:
The Alaska Republican Party further believes that current Senator Mark Begich should resign his position to allow for a new, special election, so Alaskans may have the chance to vote for a Senator without the improper influence of the corrupt Department of Justice.The only reason Mark Begich won the election in November is because a few thousand Alaskans thought that Senator Ted Stevens was guilty of seven felonies. Senator Stevens has maintained his innocence and now, even the Department of Justice acknowedges it's [sic] wrong doing.
Let's see what Begich's response is...
Late Update: Here's the full statement.
One of the first things we learned about the insurance world is that the concept of “shifting risk” for a variety of business and regulatory reasons has been ongoing in the insurance world for decades. Finite insurance and other scams have been at least visible to the investment community for years and have been documented in the media, but what is less understood is that firms like AIG took the risk shifting shell game to a whole new level long before the firm’s entry into the CDS market.And I don't believe for a microsecond that Helicopter Ben and Timmy didn't know exactly what was going on. They knew full well that the largest insurance company on Earth was running the largest insurance fraud on Earth, and the cost of taking these guys down still remains the fact that if AIG's counterparty obligations collapse, the entire global financial system collapses with it.In fact, our investigation suggests that by the time AIG had entered the CDS fray in a serious way more than five years ago, the firm was already doomed. No longer able to prop up its earnings using reinsurance because of growing scrutiny from state insurance regulators and federal law enforcement agencies, AIG’s foray into CDS was really the grand finale. AIG was a Ponzi scheme plain and simple, yet the Obama Administration still thinks of AIG as a real company that simply took excessive risks. No, to us what the fraud Bernard Madoff is to individual investors, AIG is to the global financial community.
As with the phony reinsurance contracts that AIG and other insurers wrote for decades, when AIG wrote hundreds of billions of dollars in CDS contracts, neither AIG nor the counterparties believed that the CDS would ever be paid. Indeed, one source with personal knowledge of the matter suggests that there may be emails and actual side letters between AIG and its counterparties that could prove conclusively that AIG never intended to pay out on any of its CDS contracts.
The significance of this for the US bailout of AIG is profound. If our surmise is correct, the position of Feb Chairman Ben Bernanke and Treasury Secretary Tim Geithner that the AIG credit default contracts are “valid legal contracts” is ridiculous and reveals a level of ignorance by the Fed and Treasury about the true goings on inside AIG and the reinsurance industry that is truly staggering.
It's extortion. Instead, Helicopter Ben has to print trillions up and destroy the dollar in order to pay off all the bullshit that AIG owed. It owed more than the GDP of several countries, folks. It got Too Big To Fail, and if it fails, we all fall with it.
As it is, fixing the problem will almost certainly lead to massive hyper-inflation in the coming months as we have no choice but to print our way out of the hole we're in. They have no options left. Much like those scary sci-fi films where an asteroid is heading towards Earth, we're pretending that the financial system is still solvent. It's not. It's built on air and rot on a foundation of quicksand and mirrors.
In the end, we were killed by greed.
The U.S. Attorney’s office said this morning it plans to make an announcement about a “significant criminal matter’’ later today, which sources said is the indictment of ex-governor Rod Blagojevich. The indictment will likely be handed down within the next several hours.This should be fun. Wonder how many people he'll take down with him, Chicago style.Blagojevich and his then chief of staff John Harris were arrested Dec. 9 on corruption charges. Blagojevich was accused in a criminal complaint of trying to sell President Obama’s open Senate seat. He was also accused of trying to shakedown firms seeking state business for campaign cash before a Jan. 1 law went into effect banning the practice. Charges also included an alleged plot to have Chicago Tribune editorial board members fired in exchange for helping Tribune Co. structure a state-backed deal to sell Wrigley Field.
Once in a great while, there are key turning points in a policy debate. This might be one of them.They don't know any better, and the next morning at 8:30 AM Eastern, they get the crap kicked out of any credibility they've gained in the week with the weekly unemployment numbers showing that the Republican plan of "let the economy fix itself" is a sick joke.GOP Whip Eric Cantor ... accused Democrats of "overreacting" to the economic crisis by embarking on a federal spending spree.
The Virginia Republican, speaking to reporters at the Christian Science Monitor breakfast Thursday morning, praised Rush Limbaugh for his "ideas" and for avoiding the Democratic error of "overreacting, as they often will, to crisis."
He went on to criticize Treasury Secretary Tim Geithner's recent statement that the biggest danger was "doing too little" to deal with the meltdown.
"Doing too much has huge, huge pitfalls as well," he said.
This explains quite a bit. Why have Republicans refused to take the economic crisis seriously? Why have they offered the same tired, failed economic ideas they've been spouting for decades?
Would take over three years to achieve price stabilityThere will not be any recovery in the economy until the housing collapse abates. There will be no housing market recovery until the massive number of homes on the market lowers. There will be no stabilization of home inventories until the economy recovers.
The problem is that prices do not begin to stabilize until we break below eight months’ supply – and they tend to deflate 3% per quarter until that happens. So as impressive as it is that the builders have taken single-family starts below underlying sales, their efforts are just not sufficient to prevent real estate prices from falling further. In fact, even if the builders were to declare a moratorium immediately – that is taking starts to ZERO – demand is so weak and the unsold inventory so intractable that it would now take over three years to achieve the holy grail of price stability in the residential real estate market.
A lethal deflationary combination
The combination of a 10% savings rate and 10% unemployment rate is a lethal deflationary combination that the Obama dream team of economists seems prepared to fight hard against, and we wish them good luck, but we think we are in for another year of very weak economic growth that warrants a focus on safe income wherever you can get it, and a focus on high-quality assets and defensive sectors in the equity market.
S&P 500 will hit new lows, in our view
We remain of the view that the risk of earnings disappointments will take the S&P 500 to new lows before the bear market runs its course. Based on the outlook for corporate profits and the typical trough P/E multiple that characterized recession bear markets, it would not surprise us to see the S&P 500 gravitate in a 475-650 range for an extended period of time.
Yesterday, the Wonk Room’s Ben Furnas noted that House Minority Leader John Boehner (R-OH) and Senate Minority Leader Mitch McConnell (R-KY) have been attacking a cap-and-trade proposal before Congress, falsely claiming that the measure would cost American families over $3,000 per year in extra taxes.In other words, Republicans are flat-out lying again and again to the American people in an effort to scare them on climate change legislation, making up complete fabrications so that Americans rally against the bill.They base their claim on a 2007 MIT study. However, after interviewing one of the study’s researchers, MIT professor John Reilly, PolitiFact reported on Monday that the GOP claim is false, giving it a “pants on fire” rating on the website’s “Truth-O-Meter.” According to Reilly, the report actually finds that any tax burden resulting from the bill’s enactment wouldn’t be felt until 2015 — at $31 per person and $79 per family per year, not $3,100.
It's the worst sort of irresponsible propaganda from a group of professional liars. The study they are using to promote the lies has now been proven to have been misused and misinterpreted according to the author of the study itself.
But what do you expect from the GOP in 2009? Accuracy? Integrity? Fairness? Hey Dems, let's get on this one before the Village picks it up as fact, shall we?
The jobless rate in Hickory-Lenoir-Morganton jumped to 15.7 percent, a 9.3 percentage point increase in the area located about 60 miles northwest of Charlotte. About one-third of all jobs in Hickory are at manufacturing plants, said Scott Millar, director of the Catawba County Economic Development Corp., which recruits new businesses.You pretty much figure the U-6 total for the area is well above 20% and approaching 25%, which would be Depression-era numbers. A nearly 10% jump in just plain reported unemployment in 12 months is devastating, but this part of NC has arguably the last broad-based manufacturing plants in the country. Many different types of plants made it a solid town to grow up in during the 70's and 80's. In the 90's, when the cable manufacturing plants and the dot-com boom came, the area really took off. We got a minor league baseball team, a new science and arts center and a new library, made some national headlines as a new center of manufacturing in the Clinton years."I think part of the issue we're dealing with is pure math as the nation changes into a services oriented economy," Millar said.
The local layoffs accelerated at furniture makers and textile producers that have been shifting work to low-cost overseas producers for a decade, and at auto suppliers battered by slumping car sales. Even the fiber-optic cable manufacturers that once seemed to be the region's hope are suffering from a lack of orders. Corning Cable Systems in February said it would eliminate about 200 jobs as it shut an optical assembly plant in Hickory.
Then the textile plants closed, the GE generator plant moved to Mexico, the cable plants got hurt badly when the dot-com bubble crashed and with the housing markets and the auto markets dead and gone, the last holdovers of auto parts makers and furniture plants are dying too. I lived there as recently as three years ago. Boom times even then as new housing developments, lots of work, low unemployment, international companies like Corning Cable and Getrag Gears and all the furniture plants were filling those shiny new homes across America that people couldn't afford with furniture they couldn't afford either. Those places needed IT work done, and I was good at it. Now? Unemployment has nearly tripled in one year. I guess in hindsight when the small business I worked for got bought out and I was laid off, I was lucky. I got a head start here in the Cincy area.
Hickory is going to be a very, very different place another 12 months from now. I wouldn't be surprised if the U-3 rate hit 20% before the end of the year, meaning the U-6 would be pushing 30%. Unemployment on that scale will lead to mass emigration out to other areas of the country, it's simply unsustainable. People will just move away and look for work elsewhere. That will almost certainly lead to another wave of rising unemployment as commercial and service jobs are cut to meet the new lower demand across the board. Lower property tax revenues, fewer services, abandoned property all over the place.
It's ripe for a ghost town scenario. Things will be a lot worse soon. Of course, it's a lot worse everywhere.
And it'll be a long, long time before things get better.
It's unclear exactly what changes the FASB plans to make on Thursday, but none is expected to be radical enough to have an immediate impact on stocks. Still, most investment experts say bank stocks should be avoided until the full impact can be weighed.That's fancy MBA talk for "We're lying and we made this too complex for you peons to figure out on purpose, so take our word for it."Advocates of mark-to-market rules say they provide a clearer picture of troubled assets' value because they are priced according to their present worth in the marketplace. The alternative, known as mark-to-model, allows banks to price the assets at a model determined by the institution and at times not easily in view of the investing public.
With the rise of derivatives used to package now-distressed mortgages, mark-to-market opponents say the rules need to be changed because there is no fair market value for the bad assets. The current bid offer in the marketplace is at a level that would wipe out some banks if they had to sell at those prices, some analysts say.So, the banksters want a mulligan. They want their assets to be what their models predict, and not what they are actually selling for right now in the marketplace. If they have to sell at these near worthless prices (and they have to sell at these worthless prices because the toxic assets really are nearly worthless) they they go under.
This is what I mean by America's major banks are insolvent. They are holding pieces of paper that are worth 20 cents on the dollar when the banksters say they are worth 100. But we can't call the banks out on them because they will collapse the entire global financial system if they are forced to go under.
Which means Obama's boys are letting the banksters lie about what these assets are worth. And how are these banks Too Big To Fail? Why, the Gramm-Leach-Bliley Act, which allowed these huge megabanks to form into ravenous cancers on our economy. So what's Obama's response to this regulatory nightmare?
Why, hiring the guys who created it in the first place! Larry Summers, Robert Rubin, Tim Geithner, and now we learn the nominee for Geithner's second-in-command is the guy who did the legwork on the GLB Act:
Tim Geithner’s new nominee for number two at the Treasury Department, Neal Wolin, played a key role in drafting legislation in the late 1990s deregulating the banking system, a former Treasury Department official confirms to us.Failing upwards is apparently not just a prerequisite to be in the Bush administration, but one for the Obama administration too. We're already seeing the influence of the deregulators on the banksters and in a major way: virtually no accountability and despite all of Obama's tough talk, the reality is the banksters will continue to get free trillions until we inflate our way into a banana republic. These are the same guys that pitched the notions that the Depression-era protections on Too Big To Fail were antiquated nonsense, and that housing values would go up forever. Now they're calling the shots on Obama's economic policy. Why should we expect anything different?The law that Wolin helped draft has been blamed by some critics, many of them Democrats, for easing up regulatory pressure on huge financial institutions, tangentially helping create today’s mess — and his role drafting it could come under questioning at his upcoming confirmation hearings.
Our reporter, Ryan Derousseau, came across Wolin’s role in researching our big profile of Wolin at WhoRunsGov.com. Stuart Eizenstat, a deputy Treasury secretary under Bill Clinton, confirmed that as Treasury’s general counsel at the time, Wolin “provided the technical and legal drafting” for the Gramm-Leach-Bliley Act.
As Ryan writes, the Act hasn’t been directly blamed for today’s meltdown. But it did pave the way for the birth of huge financial companies like Citigroup that were deemed “too big to fail” when their mortgage bets went belly-up and the credit market evaporated. The government, of course, had to bail out these institutions with billions in taxpayer dollars.
Wolin — who was picked after several other candidates passed on the slot — did the legal work under then-Treasury Secretary Larry Summers, who is now Obama’s head of the National Economic Council. The difference here is that Summers’ post, unlike Wolin’s, is a non-confirmable one, so he hasn’t been pressed publicly on Gramm-Leach-Bliley. The question now is whether Wolin will come under sharp questioning over his role in creating it.
Only 10 percent of American voters say executives who received bonuses from companies helped by the government should keep the bonuses. Other choices are:Nice. And there's this on Obama's budget:
- 22 percent want the government to ask the executives to voluntarily give the money back;
- 30 percent want the government to cut off funding until the bonuses are repaid;
- 16 percent say tax the bonuses at 90 percent;
- 2 percent say sue the executives to get the money back;
- 13 percent say launch criminal investigations to get the money back.
American voters approve 58 - 31 percent of the job President Barack Obama is doing, compared to 59 - 25 percent in a March 4 Quinnipiac University poll. Support is strongest, 69 - 26 percent, among voters 18 to 29 years old and declines with age. Voters approve 55 - 37 percent of the way President Obama is handling the economy and approve 56 - 25 percent of the way he is handling foreign policy.So he's not doing too much, they support his budget, and the only thing the voters don't like is the Geithner Plan.
Voters disapprove 59 - 30 percent of the job Republicans in Congress are doing and disapprove 49 - 40 percent of the job Democrats in Congress are doing.
Obama is trying to do too much, too soon, 35 percent of voters say, but 59 percent say the issues need swift action. Even voters over 65 say 46 - 44 percent that swift action is needed.
Voters say 47 - 28 percent, with 21 percent undecided, that Obama's call for higher taxes on those making more than $250,000 a year is good for the economy. Voters in that higher income bracket disagree 41 - 29 percent, with 27 percent undecided.
By a 50 - 43 percent margin, voters oppose the plan to spend $1 trillion to buy up bad loans from banks, but voters split 37 - 35 percent, with 28 percent undecided, in their approval of the job Treasury Secretary Timothy Geithner is doing.
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