A Bit Of Good News...Or Not

Housing starts for February rebounded considerably from January's record low.

New U.S. housing starts unexpectedly rebounded in February, surging 22.2 percent, according to data on Tuesday that provided a rare dose of good news for the recession-hit economy and fractured housing market.

The Commerce Department said the jump in housing starts to a seasonally adjusted annual rate of 583,000 units was the biggest percentage rise since January 1990.

Maybe that's just a blip, but again if the supply of houses goes up, the price goes down. If anything, this means there's still a major glut of homes on the market, and the big jump in new houses means there will be even more pressure on prices to drop.

And that's not good news.

Scary Ass Numbers

The number of folks who expect another Great Depression within a year is up to 45% in CNN's latest poll.

"Will the Great Recession turn into another Great Depression? A growing number of Americans think it might," said CNN Polling Director Keating Holland. "Last December, 38% said a depression like the one the U.S. experienced in the 1930s was likely in the next year. Now that number is up 7 points."

Of course if you asked Americans "Do you think Admiral Adama is a Cylon?" 45% of them would say yes too. Still, these are scary numbers no matter how you look at it. Confidence is pretty damn low right now.

The poll described the 1930s' Great Depression as a time in which roughly one out of four workers was unemployed, banks failed across the country and millions of ordinary Americans were temporarily homeless or unable to feed their families.

Nearly nine out of ten people questioned in the survey said economic conditions in the country are poor today, with only 11% suggesting that conditions are good.

And the poll indicates that Americans think it will take time to rebound from the recession, which began at the end of 2007.

"Only one in ten say recovery is likely within a year; one in five predict it will take longer than four years for the country to get back on its feet," Holland said.

And the people will shout "Helicopter Ben, save us!" And Helicopter Ben will whisper, "I think we've averted that risk. I think we've gotten past that."

We'll see. Me? Yeah, count me in that 45%.

Your Liberal Media In Action

Front page on the Washington Post: AIG's bonuses could very well sink the entire Obama administration!(emphasis mine)

President Obama's apparent inability to block executive bonuses at insurance giant AIG has dealt a sharp blow to his young administration and is threatening to derail both public and congressional support for his ambitious political agenda.

Politicians in both parties flocked to express outrage over $165 million in bonuses paid out to executives at the company, demanding answers from the president and swamping yesterday's rollout of his efforts to spark lending to small businesses.

The populist anger at the executives who ran their firms into the ground is increasingly blowing back on Obama, whom aides yesterday described as having little recourse in the face of legal contracts that guaranteed those bonuses.

Wow, not even the GOP could have written a better article. Obama is floundering! He's in over his head! Eight weeks into his failed failure of a failed term he's failing badly! Last Obama aide out of the White House, turn out the lights, please.

But the bonus issue, in particular, is hounding Obama as he pursues his larger goals, in part because of the president's own repeated declarations of outrage -- offered again yesterday -- aimed especially at the firms that are feeding at the public trough.

In February, Obama announced tough new restrictions on executive compensation that promised an end to massive salaries for executives of failing companies. Similar rules were eventually written into legislation and hailed as evidence that executive compensation would be checked.

But reports about the latest AIG bonuses quickly undermined whatever political capital Obama has earned with his past efforts.

Got that? OBAMA IS AN UNQUALIFIED FAILURE AFTER EIGHT WEEKS! Surely the American people have spoken!

President Barack Obama's job approval rating, at 61% in the latest three-day average of Gallup Poll Daily tracking, is slightly above where George W. Bush's and in particular Bill Clinton's were at this point in mid-March of the first years of their administrations.

Umm...what? That can't be! Surely the President's agenda is in deep trouble!

A new Gallup Poll finds just over half of Americans, 53%, favoring a new law that would make it easier for labor unions to organize workers; 39% oppose it. This is a key issue at stake with the Employee Free Choice Act now being considered in Congress.

Ummm....OBAMA IS A SOCIALIST! (storms off)

All winguttian satire aside, there's not a whole lot Obama can do about AIG's bonus situation as I explained yesterday. In fact, a lot more bonus shenanigans and counterparty payoff three card monte is on the way for bailout recipients. However, the notion that AIG has already deep-sixed the President and his agenda is pretty ludicrous. Nobody's blaming Obama for this...except the Washington Post. Funny how that works. Even the wingnuts are blaming, well, AIG for this.

Let's blame AIG for getting themsleves into this mess, needing bailouts from Bush before Obama took office. Course, that hasn't occured to the Village. ITEISATDF. The article glosses over how Treasury has decided it doesn't need to give AIG that latest $30 billion in bailout cash if AIG insists on handing out millions in bonuses.

And while Treasury taking that money out of AIG's bailout is a great idea, there is another option: Plan N. Nationalize AIG and fire people. It really is that simple. If anything, AIG has just brilliantly made the case as to why Plan N needs to be executed now...and the people would certainly back taking over failed companies that required billions and billions of taxpayer money and firing the people responsible for losing all that money in the first place.

The Wonk Room's Pat Garofalo has more on why AIG may have just forced Obama's hand on Plan N. I'm all for THAT action.

StupidiNews, St. Patty's Day Edition

• An Israeli scholar disputes that the Dead Sea Scrolls' "authors" never existed.
• A Florida legislator wants drug tests...for the unemployed.
• GOP aides are ambushing Congressional Democrats with video cameras in order to spur an embarrassing verbal slip.
• The Fed is considering a rapid increase in purchasing bad mortgages to boost the economy.
• Could "Scratch: The Ultimate DJ" do for turntables what "Rock Band" did for guitars?

Another Milepost On The Road To Oblivion

Hey the stock market's up! We're saved!

"Don't count on a consumer-led recovery."

Umm...crap. Case in point, who does that leave, big business?

"U.S. output plummets, manufacturing at record low."

Double crap.

Running Vs. Bunning

While the name most KY Democrats hear as the person to run against Jim Bunning next year is Bob Mongiardo, it looks like Rep. Ben Chandler is interested in the job too.

Chandler says he's being encouraged by supporters and he's been approached by the Democratic Senatorial Campaign Committee about a possible run next year.

Chandler, a Democrat, was at the Kentucky Capitol Friday and had a meeting scheduled with Gov. Steve Beshear. He said they were planning to talk about a variety of issues and politics may be one of them.

Beshear confirmed their meeting, but declined to say specifically what they were talking about.

Chandler is the grandson of Kentucky political icon and Major League Baseball commissioner Happy Chandler. He is a former Kentucky attorney general and was the Democratic nominee for governor in 2003.

Either way, Bunning is in trouble in 2010. Keep an eye on this race.

More On ITEISATDF

As the theory goes, any and every event is either good for Republicans, bad for Democrats, or both. Case in point: The AIG bonuses scandal is...you guessed it, bad for Obama and the Democrats.

The Obama administration is increasingly concerned about a populist backlash against banks and Wall Street, worried that anger at financial institutions could also end up being directed at Congress and the White House and could complicate President Obama’s agenda.

The administration’s sharp rebuke of the American International Group on Sunday for handing out $165 million in executive bonuses — Lawrence H. Summers, director of the president’s National Economic Council, described it as “outrageous” on “This Week” on ABC — marks the latest effort by the White House to distance itself from abuses that could feed potentially disruptive public anger.

“We’ve got enormous problems that need to be addressed,” David Axelrod, Mr. Obama’s senior adviser, said in an interview. “And it’s hard to address because there’s a lot of anger about the irresponsibility that led us to this point.”

It doesn't matter what the event is, it's bad for Democrats, good for Republicans, or both. Stock market goes down, it's Obama's fault. Stock market goes up, Bush is responsible. Price of gas goes up, Obama's environmental and foreign policies are driving up oil. Gas goes down, free market principles employed by Bush are working.

Anyone can play, and only Democrats can lose. Remember, In The End, It's Somehow Always The Democrats' Fault.

Think You're Safe In An Apartment?

...from the housing crisis? Think again (h/t Atrios).

Nicholle Krause first noticed the weeds sprouting in the usually well-manicured grounds of her 320-unit apartment complex in Chandler, Ariz., in December. Soon, signs of neglect began multiplying: Garbage spilled over from the dumpsters, the water in the swimming pool turned a slimy pea green and the grounds were infested by swarms of bees — especially alarming because Krause is severely allergic to bee stings.

“I couldn’t even go outside to enjoy where I live,” said Krause, a 21-year-old office worker who pays $827 a month for a one-bedroom apartment with garage space. “I shouldn’t have to pay $800 a month to live in a … hole.”

It wasn’t until early March that Krause and other residents learned why the complex – the alluringly named Alante at the Islands — was rapidly going to seed. The property owner, Irvine, Calif.-based Bethany Holdings Group, had abandoned the complex and a dozen other large rental properties in the greater Phoenix area after defaulting on hundreds of millions of dollars in loans.

As panicked renters in Arizona began holding public meetings to explore whether they could walk away from leases, recoup security deposits or sue, it became clear that the scale of the mess was far larger than they had realized. Companies under the Bethany umbrella owned at least 60 — and possibly many more — large residential complexes across the nation, all of which are now believed to be in bankruptcy or receivership, potentially affecting tens of thousands of renters.

The Bethany Group meltdown highlights how few protections exist for renters caught in the foreclosure crisis. That’s a situation that some experts say is becoming much more common.

Large apartment complexes are owned by companies who own multiple complexes (I know mine is). These companies have been hit just as hard as homeowners by falling real estate values. They're losing money and are unable to by law in most states to jack up rental prices to make up the difference precisely because values are falling. Some are going under. They are taking thousands, if not millions of apartment renters with them.

You're going to see a lot more of this in 2009. Know who you're writing the checks to if you rent. Do some research. If your rental group landlord goes under, you're out on the street even if you've never been a day late on the rent. Know what the laws are in your state.

Find out what renters' legal protections are in your state now if you're a renter. Strongly consider paying on a monthly basis instead of tying yourself down to a lease.

With this job market and corporate landlords going under, you need flexibility right now.

Heavy Is The Head Tha Wears The Pants In The Family

Mixed (and horribly slaughtered) metaphors aside, breadwinners are worried about their jobs.

Thirty-six percent of people questioned in a CNN/Opinion Research Corp. survey released Monday morning said unemployment is the most important economic issue facing the country today, almost three times higher than the 13 percent who felt the same way last April. Inflation is second at 20 percent, followed by the mortgage crisis at 16 percent, the stock market at 14 percent and taxes at 11 percent.

Last April, 47 percent of poll respondents said rising prices and the rate of inflation were the most important economic issues facing the country, putting that at the top of U.S. economic concerns.

"Last spring, Americans were spooked by rising gas prices," said Keating Holland, the CNN polling director. "Now they're spooked by high unemployment figures and the growing concern that good jobs aren't available."

I forsee that number going a lot higher in the next few months as unemployment increases.

The Last Ten Years In Economic Journalism Explained

...expertly by Steve Benen.

I see. Just so we're clear, here's a helpful guide to the rules of market watching, as they relate to partisan politics:

When the market went down on Bush's watch before the 2008 elections, this was Bill Clinton's fault.

When the market went down on Bush's watch between November 2008 and January 2009, this was Barack Obama's fault.

When the market went down during Obama's first seven weeks in office, this was definitely Barack Obama's fault.

And when the market rallies on Obama's watch during the second week in March, George W. Bush deserves at least some of the credit.

Or to put it even more simply, Village Rule #1: ITEISATDF: In The End, It's Somehow Always The Democrats' Fault.

Needless to say, new tag.

Fish In A Barrel

Josh Marshall has a decent point about AIG's bonus story over the weekend:

Few exchanges have so captured the disconnect that makes this situation so politically explosive. We're collectively taking our country's future in our hands, spending vast sums of money to keep these companies from suffering the consequences of their own folly and (in many cases) criminality. And in return we're receiving cavalier dictates about pay-outs and bonuses from executives who by any reasonable measure work for us -- dictates we promptly accede to. There's a beggars can't be choosers problem there. And the disconnect is so mighty that it fuels the impression that the whole enterprise is not what it seems, not what we've been told, that in addition to picking up the tab we're being played for fools.

And while that's correct, the real problem with AIG is that CEO Edward Liddy can actually tell Timmy and Ben to go intercourse themselves with farm implements because AIG really does have the global economy over a barrel. If AIG goes under, the global financial system goes under with it. Period. Checkmate.

So nothing will be done in the long run. We'll continue to shovel money into the AIG furnace and shut the hell up like good little boys and girls, or the counterparty system will annhilate the entire system of global finance, leading to a total collapse of the whole pyramid. Lehman Bros. was allowed to die, and as a result the global banking system nearly went under. It will not be allowed to happen again with a much, much larger company like AIG.

AIG knows it can do whatever it wants to do right now. It's bulletproof. If it wants to give bonuses, it will. Honestly, what's the government going to do about it? Let the largest insurance company in the world go bankrupt and collapse the world?

Ask yourself how AIG was allowed to get this large and this important in the first place: complete failure of Federal oversight. Those are the people we need to be angry at here, not just AIG...Democrats and Republicans alike.

[UPDATE] Obama is trying to pursue "every legal avenue" to block AIG's bonuses. There's really not much the government can do, frankly, short of mass firings and forcing AIG to break contracts to employees.

[UPDATE 2] Or as Atrios says, if it's a problem, just nationalize the assholes already. If Marcy Wheeler is right over at Fire Dog Lake, they're basically extorting billions from us with this little bonus plan. Pay up or else, they say. The "or else" needs to be "We own you and we're firing all of you. Now."

Why We Need Real Health Care Reform

The US may spend the most per capita on health care, but health care is a much more efficient and cost-effective process in every other major country -- including Brazil, China, and India.

U.S. workers and employers get 23% less value from their health-care spending than those in Britain, Canada, France, Germany, or Japan, and 46% less value than in Brazil, China, or India, according to a Business Roundtable study that examined the cost and performance of the U.S. health-care system.

That value gap exists even though the U.S. spends far more on health care per worker than the other countries examined. The study, released on Mar. 12, found that for every dollar the U.S. spent on health care, Britain Canada, France, Germany, and Japan spent 63¢, yet the health of the U.S. workforce lags by 10% on a composite measure. As for Brazil, China, and India, they spend just 15¢ for each U.S. dollar spent, yet the health of the U.S. workforce lags behind those three by 5%.

And despite all that, nearly one out of every six Americans lacks health insurance period. Big Pharma and Big Insurance has turned the industry into a complete joke. We're the laughing stock of the world, spending nearly $600,000,000,000 a year on health care, and yet we still have millions of Americans who can't afford to see a doctor.

It's gotten to the point where even Big Business is sick of paying for health care benefits that only seem to "benefit" drugmakers, hospital chains, and insurance companies. Businesses want to keep the existing model and just "rein in costs" of course, but only a totally new system will fix the problem.

If it's not fixed, businesses will take their jobs overseas in this economy. It's as simple as that.

StupidiNews!

• Pakistan has decided to reinstate its fired Chief Justice, ending days of protests.
• Actor Ron Silver has died from cancer at age 62.
• The number of MBAs is increasing as out of work business execs go back to school.
• Sony is facing pressure to cut the price of the PlayStation 3 or they could lose even more games to market leader Nintendo's Wii.
  
• Scientists are zeroing in on the Higgs boson particle -- if the Large Hadron Collider can get back on-line.

Last Call

Josh Marshall takes a look at AIG's list of counterparties and comes up with a doozy.

The 'toplines' don't seem terribly different from what had been assumed. European banks show up disproportionately among the highest payouts. Barklays $7B in payments to counterparties by US Securities Lending, $.6B through Maiden Lane III, $.9B in collateral postings under AIGFP CDS.

The biggest recipient seems to be France's Societe Generale for about $12B. Deustche Bank got slightly less.

The one thing I had not heard of previously was $12.1B that went to municipalities in twenty states.

Yesirree Bob, your local government had pension and investment plans with AIG! One billion to California, another billion to Virginia, half a billion to Ohio, almost $300 million to Kentucky...the list goes on. AIG turned around and lost all that money and more. You paid for it after all when they bailed AIG out and they paid off these counterparties. So not only did you pay for it the first time when these governments collected the taxes and then invested it with AIG, you paid for it a second time when you bailed out AIG.

You would think a company like that with billions of state government dollars would attract more oversight.

You'd of course be wrong.

The Cincy Tea Party

Instagoober reports that the Cincy Tea Party rocked the universe and redefined the history of protest! Or not.

Couple thousand people showed up to say "We don't like bailouts or Barack Obama!" These things are popping up all over. Yeah, you have to figure that with a 60ish approval rating, about a third of the public doesn't like the President so far. They're organizing on the internet and peacefully protesting something they don't like. You can do that in America.

But as these same people told people like me over the last eight years, "You guys lost the election. Get over it. He's our President now."