While Chrysler refocuses its capital and development plans on the people of China, it leaves the United States scuttled in its wake.
In a recent statement, it said that electric vehicles would only represent 2% of its sales by 2014. So in a bold move, it is now the only top selling automaker in the U.S. without a hybrid offering.
Chrysler spokesperson Nick Cappa said on Friday that an in-house team of electric car development engineers had been disbanded in favor a more traditional organization.
This after the company took $12.5 billion from the U.S. taxpayer and another $70 million in grants from the Dept of Energy.
Chrysler again disappoints and finds itself on par with the Reserve Bank & friends' abuse of the U.S.A. and its diminishing financial and market oversight.
Who is Karl Denninger? He is like most of us, a normal guy, a computer geek, who happens to enjoy sharing his thoughts on the market and politics among other things.
In a $2.8 trillion municipal bond market that more than doubled in just over a decade, public corruption, officials’ mistakes and lack of disclosure cost taxpayers as much as $6 billion a year, according to data compiled by Bloomberg.
What's going on here?
Nov. 2 (Bloomberg) -- At the end of a March 6, 2000, conference call with the financial adviser David Rubin, city of Atlanta officials disqualified the winning bid for a $453.3 million investment-management contract.
The decision shaved $58,000 off what Atlanta taxpayers would have earned from the $13.5 million high bid and awarded the account to runner-up Bank of America Corp., according to a copy of city documents obtained under the Georgia Records Act.
Only after the Internal Revenue Service investigated five years later did local officials learn that Rubin’s firm, CDR Financial Products Inc., had entered into a secret side agreement with the Charlotte, North Carolina-based bank. CDR’s share would be worth as much as $340,000, based on city and federal records.
This, ultimately, is the sort of result that one can expect when we refuse to stop the looting and start prosecuting.
There have been many over the last two years who said that the "subprime (and stated income) borrowers deserved it" - referring to the loss of their houses, of course.
Perhaps they did.
But the bigger issue here - the societal issue - is how crooked the entire marketplace has become for securities in general. Not just for end-user mortgages but also for securitizations, municipal bonds (as outlined in this article) - virtually everything!
“We need a worldview change about transparency and that includes municipal finance,” said Elizabeth Warren, chairwoman of the Congressional Oversight Panel for the Troubled Asset Relief Program, in an interview with Bloomberg last month.
Indeed. But so far we see zero indication that we're going to get it. Municipal finance is just one tiny piece of the scam-ridden world of financial back-room deals.
Witness the mortgage-backed bond business, where firms such as Goldman Sachs have admitted shorting the very mortgage-backed securities they were packaging and selling! McClatchy ran a story this weekend on the matter which I opined on this morning; the salient factor here being not that McClatchy picked this up, but that it took two years for the so-called "mainstream DC media" to do so!
We continue to see the fraud-and-pony-show throughout Wall Street and Washington DC - and there is no indication anywhere that anyone gives a damn. Amnesty, as given to Bank of America in this case, is an outrage. Remember that the allegation in the instant case is that:
“IRS believes that CDR, Bank of America and possibly others may have colluded to fix pricing,” an unidentified Atlanta employee wrote in an undated internal memorandum after city authorities met with IRS investigators in September 2005.
Got it? Fix prices, and if you're a big bank you get amnesty. Even though what you did is under black-letter law felonious, you will not be prosecuted so long as you are one of the favored few.
How much more of this is hidden under the rock of bribes, er, "campaign contributions" and lobbying? The answer is likely to surprise, but what's also likely to surprise is exactly how little of this we the "little people" will ever hear about.
Sustainable economic growth does not come from scams - it comes from honest deals. So long as the way Wall Street "makes money" is to rip someone off, and those who engage in such activity are given "amnesty" instead of losing their corporate charters we will simply continue robbing the common man for the benefit of the few banksters among the "privileged elite."
First of all I want to thank you for having me as a guest today!
My name is Adam Hewison. You might want to Google Me to confirm what I am about to share with you.
There are plenty of people out there that create “exclusive email courses” with little or no credentials to actually backup their teachings. So, I think it’s right that I share a little bit about myself with you before we even start.
I was a former floor trader on the IMM, IOM, NYFE and LIFFE as well as a risk manager of a large, multinational corporation in Geneva, Switzerland. I also have written books on forex trading and trend following. In 1995, I founded INO.com and later co-founded MarketClub. I’ve been in the trading biz for over three decades and have seen it all. I created this course as a way to give back and share trading tips and techniques that I still use in my trading today.
Rather than repeat what is already here, just look at the article below.
Every success,
Adam Hewison
President, INO.com & Co-Creator, MarketClub
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If thats true, where have they been? My friends have the answer...they tell me that GM and other American car companies have been clowning us all these years. Now that they're status and reputation has dropped to all time lows, they claim that over-night they've found quality!!! Except of course for Ford, whom for many years have proclaimed "At Ford...Quality is #1". So we say, what about outside the Ford facilities? Or do they only really mean that with their F150 line?
Maybe they mean the F150 line here and all their flex fuel car line in Brazil. Americans can be convinced to buy crap if the commercials are both sexy and macho. In Brazil however, Ford doesn't advertise because the people demand of manufacturers that they want highly efficient cars, so voila! you have flex fuel cars which run on highly efficient low cost bio fuel.
In the late ninety's, the State of California on behalf of its people mandated highly efficient vehicles be sold. Voila! GM produced the very popular EV1, only to spend more time and money poo-pooing its own product and only allowing folks to lease, not purchase this coveted car. They couldn't afford having this engineering marvel outsell its other lines. GM couldn't afford to allow the EV1 popularity in California to spread across the U.S.A. They were making too much money producing inefficient, poor quality vehicles which saw more profits from a shorter owner lifespan and a booming parts 'n service business.
Should we applaud car companies for selling us products that leak dollars from our pocket while we drive, then turn around and make a better product only when we stop buying from them? We are not free of blame here however. Business marketing dictates that they will sell and charge what the market will bear. If we are too dumb to demand far better and if we are willing to part with our money for anything less, even using credit, then we're as much to blame here too. The only American car companies who should be applauded are the innovators. Take Tesla for instance. Ok, right, their first car, a very exhilarating, fantastically fun-to-drive model is over $100k. Yet this tiny car company makes one of the fastest cars on the road and it runs on batteries. It can beat nearly any sports car the world over with its 0-60 mph in 3.9 secs. with batteries! It can be fully charged in only 3.5 hours at home. It can go over 240 miles on a single charge! Tesla started out in 2003! Yes, that we can applaud! Tesla is going to produce another model at less than half the price and be more available to the family market. While the price tag sounds ominous to us during the recession; coming from a very tiny company like Tesla, it can be applauded! They don't have the advantages of the economies of scale like Ford and GM, so in comparison, Tesla can be applauded! And they are an American company...yeah!
But GM with their anticipated 2010 release of the Volt, carrying a $40k price tag? Come on! Lets look at Toyota who has been making the Prius Hybrid since 1996. Who still to this day ranks among the most efficient and pollution clean vehicles in the world. Currently they are 2nd behind the Smart Fortwo. Then Toyota places in the winners circle again with the Toyota iQ. Back to the Prius...in price comparison the Prius even when maxed out fully loaded with options, cost a clear $8k less than a base model Volt from GM. Don't need all the bells and whistles? Then you can get the Toyota Prius for a whopping $18K less!!! Mind you, Toyota has been doing this since 1996 with this car, which is now in its 3rd generation. We can applaud a car company who has been doing the right thing for the people and stand as a shining example. Even when GM was busy laying off American workers and closing plants, Toyota was sending employees on leave fully paid! Then when the worst hit, they did it again, but then asked its employees to volunteer in their communities. For this, we can applaud a car company who does right by the people!
Then theres the Ford Fusion. At $27.3k base or $36.6 fully loaded, it gets 41 mpg or possibly 48 if you drive it nicely. Do the same thing with a Toyota Prius and you get about 60 mpg by comparison. Ford was making all electric vehicles all the way back...believe it or not...from 1890 through to 1930. So you tell me that we the people haven't been clowned? We have had the ability but since the advent of dirty, filthy oil, they just didn't want to produce anything that was exciting to the buyer using electric technologies. They could have all this time but instead, we have paid for and paid for, and paid some more, for cars and the service of those cars which just don't last. It took a massive mistake through war (Pearl Harbor), by the Japanese in defeat, to learn that the best way to get to the top is with quality, efficiencies, and caring for its people.
We recently heard that GM has good sales in China. Question...does this help the U.S. side and its workers? No? Ah Shucks! We also heard that GM is going to be building the largest GM manufacturing facility in China. Is that where our bailout money went...to China???? Does this benefit the U.S. taxpayer? No? Ah Shucks! Then why did we bail them out?
Why don't we the people of the United States demand the same of our American companies as with Toyota; as with home grown Tesla? If we would and if they responded...even if mimicking Toyota, who has been doing it all these years, then we could applaud the Americans. But we'd have to ask ourselves, was it worth the wait? Could we have spoken up far far sooner and got a better deal for us and our planet? Why aren't the Americans leading the technological innovations and why must we get the old bits while the rest of most of the world benefit from the newest technologies??? Its because we'll buy anything...we'll buy crap even. We need to clean out our old expectations and start up a new and healthier lifestyle of expectations for our country. And we need to demand it from all our businesses. Will you speak up?
Special thanks to Art for inspiring this story; you really have interesting and great on-target perspectives...and to Gary, burning oil and billowing smoke from his car as he drove down the highway late one night.
There is a company now that has a solar lease product which makes solar affordable now for every homeowner who wishes to save money on their electric bill and reduce their carbon footprint at the same time! This is an exciting discovery...
This next article comes to you thanks to Treehugger. The video at the end shows the visual consequences of this problem as well.
Why is anyone fighting to save these things again? A detailed report in the New York Times just revealed that hundreds of coal plants across the country are routinely dumping thousands of gallons of waste water into rivers and lakes--rivers and lakes that millions of people get their drinking water from.
So here's why all that dumping is going on, in a nutshell--coal plants, as you well know, are extremely heavy polluters. Some plants pollute so heavily, some even spewing sickly yellow smoke, that little coal waste chunks litter nearby residents' yards and coat their property in a thin film. So when a community gets tired of this--and gets sick of the respiratory illnesses and intermittent acid rain the plant creates as well--sometimes they're able to get the state to insist on stricter pollution regulations.
If they're lucky, as in the case of the super-polluting coal plant in Masontown, Pennsylvania, they're successful, and the coal company installs 'scrubbers' that trap up to 150,000 tons of the pollution and keep it from entering the air. Hooray! Right?
Not so fast. Since the scrubbing process creates waste water from all that pollution, it turns out that the coal companies are simply dumping all of into nearby rivers and lakes, many of which Americans get their drinking water from.
And if you're anything like me, you're first reaction will be something like, "how the hell are they allowed to do that?" The answer is, oftentimes they're not. But they're getting away with it unpunished. You see, there's no federal regulation--at all--that specifically determines how much, if any, waste coal plants can dump into water sources. There are state regulations, and restrictions set by the Clean Water Act, but the Times found that while the plants are receiving notices for violations, nothing is being done about it:
Ninety percent of 313 coal-fired power plants that have violated the Clean Water Act since 2004 were not fined or otherwise sanctioned by federal or state regulators.
It also notes those few plants that have had to pay fines--but they're egregiously low, even for excessive violations:
Hatfield's Ferry has violated the Clean Water Act 33 times since 2006. For those violations, the company paid less than $26,000. During that same period, the plant's parent company earned $1.1 billion.
In other cases, there's no existing framework at all to prevent companies from dumping harmful chemicals. This, for example, is particularly alarming:
only one in 43 power plants and other electric utilities across the nation must limit how much barium they dump into nearby waterways ... Barium, which is commonly found in power plant waste and scrubber wastewater, has been linked to heart problems and diseases in other organs.
The atrocities go on and on. No wonder coal companies are balking at the prospect of limiting their pollution under a climate bill--they're evidently entirely unfamiliar with taking the environment and/or people's health into account at all. So allow me to hark back to my opening question: coal plants pollute the air, give people heart and respiratory problems, contribute to climate change, and now, dump tons of dangerous waste into our drinking water every day. Why is anyone trying to save these things?
People that are the closest to the issue say it best: jakkman69 wrote: I live right here. We have our corrupt officials to comfort us and tell us it's all A-OK. As long as those people are rich and happy, we are all OK. ALL the creeks in knoxville run grey with polluted waters. Way Way before this spill happened. We are so polluted u would shit ur pants if you knew what oak ridge and our corrupt officials have done here. Cancer all over the place here. Thank God we have corruption to protect us.......
We don't think CLEANTECH is just a myth; not at all! But from the deplorable action of big oil, coal, and nuclear power companies you'd thing that it was. See the next article (coming soon, above this one) on Coal Companies deplorable reaction to being asked to clean up their act and install air pollution equipment.
Some of what you see on this blog is not new but we'd sure like to help spread the education to those who haven't exactly been finding truths in all the usual places:
The 4 Biggest Lies Told about Alternative Energy
So let's just clear the air. Those public relations hot-shots at Big Oil spent years trying to convince investors and consumers that "cleantech" was really just a myth. A crazy idea with no basis in reality.
It's pathetic, really-- when you think about the depths Big Oil's sunk to in order to keep its massive pockets padded. Of course, their distractions, diversionary tactics, and -- outright lies -- have now been exposed. Take a look. . .
* Outrageous Lie #1 - Wind energy is inefficient and only provides a small amount of electricity.
Absolute hogwash. The U.S. Department of Energy estimates America's wind energy potential to be larger than total U.S. electricity consumption today. Financial News Online estimates the wind sector, which has been developing for more than 10 years in Europe and for about five years in the U.S., could bring in annual revenues of $10 billion to $12 billion.
* Outrageous Lie #2 - Renewable energy can't survive without subsidies
Right. . . that's why "Big Oil" invested more than $58.4 billion of its own money into alternative energy from 2000 to 2008. And, as I mentioned earlier, more than $155 billion was invested in 2008 in clean energy companies and projects worldwide. Does that sound like an industry that can't survive without government handouts? Didn't think so.
* Outrageous Lie #3 - Solar energy can only serve a tiny fraction of U.S. or world electricity needs
Actually, the truth is. . . solar photovoltaic (PV) technology can meet electricity demand on any scale. The solar energy resource in a 100-mile-square area of Nevada could supply the U.S. with its entire electricity demand using modestly efficient commercial PV modules. Bear in mind, the market capitalization for pure-play solar companies has jumped from $1 billion in 2004 to over $118.3 billion today. The carbon based energy companies in the State of Florida which is dubbed the "Sunshine State" keep utility rates artificially low just to thwart interest in alternative energy development. Sad...don't you think? The Sunshine State isn't a model for solar usage in the U.S.A.???
* Outrageous Lie #4 - Geothermal energy is still new and experimental
It's exactly the opposite. Geothermal energy has been used to generate electricity since 1904. Today, the United States has nearly 2,800 MW of geothermal electricity connected to the grid, which generates a yearly average of 15 billion kilowatt hours of power. That's comparable to burning about 25 million barrels of oil... or six million short tons of coal per year.
It's easy to understand why lies like these would be spread.
But now that you know the truth — Want in on a couple more "truths" that might surprise you?
*According to Morgan Stanley, banks will soon become reluctant to lend money to fossil fuel projects. Take a look at this from a Morgan Stanley press release:
Leading Wall Street Banks Establish The Carbon Principles
"The Principles are... Energy efficiency. An effective way to limit CO2 emissions is to not produce them. The signatory financial institutions will encourage clients to invest in cost-effective demand reduction."
Seems that the banks have made their decision — and they're placing their bets squarely on renewable energy.
*Think coal is still our future? Consider this: since 2002, 100 coal plants have been cancelled in the U.S. alone. This trend "demonstrates an undeniable trend of American communities moving beyond coal and toward clean, renewable energy," according to Reuters.
*And don't even think about coal as a possibility in Los Angeles:
"Los Angeles will eliminate the use of electricity made from coal by 2020, replacing it with power from cleaner renewable energy sources, Mayor Antonio Villaraigosa said."
-- Reuters, July 2, 2009
As you can see — the evidence is truly overwhelming. And our future is crystal-clear. Question is; will you be able to find which solar, which wind, which geothermal will shoot to the top of the charts and will you get into the market near the bottom? Or will you catch the wave just before it breaks and miss the next new wave rising from the bottom? This is where most individual investors get in. If you want to make big money, you have got to spend more time researching and watching potentials via a watch-list of ten or fifteen in each category, weeding out one by one as new confirmed data comes in on each company.
The person overseeing the TARP funds says that they can not account for 350 billion of the then 700 billion given out to the financials as bailouts. Much more money is unaccounted for or it could be thought of as simply stolen from the U.S. taxpayer. We say that it is stolen from U.S. Taxpayers since as you now know, all money printed in the United States for the Federal Reserve banking system is a debt immediately attached to the tax payer.
The following is a video about the Pentagon which addresses routinely cooking its books:
Former Federal Reserve Chairman Alan Greenspan says the current crisis is much broader than anyone could have imagined...a state of shock and disbelief. This is the same man that accomplished gross financial deregulation that then translated out into our own financial downfall. A financial deregulation on a scale never before seen.
How can this man, not know what is going on when he and his fellow Fed handlers see what the direct result of deregulation causes across the entire country? He was Fed Chairman during the Saving & Loan debacle. How can he not have seen this economic crisis coming after that? He says that we have the highest standard of living...based on what?...the credit program that has enticed every working man and woman to spend beyond his/her means???
We looked to this man as did the rest of the world, as some financial genius...yet he did not see this coming. This is a lie. And before you blame him directly, let not. He was only face and the mouth for the super secret Federal Reserve Banking System. The same system that is not part of the United States government. The same system that no independantly assigned party nor the U.S. government itself can audit by order of pre-agreement. So how can you believe anything that the Fed reports? How can you stomach the creation of money at your expense, the massive bailouts of financials at your expense, the pushing of credit and mortgage at your expense and peril? With the advent of the Federal Reserve Banking System, we have done away with the Free Market Pricing System of Money which has allowed this financial cartel to make money out of nothing and then charge us for doing so. Its like some kind of fairy tale gone quite mad! We are like Alice in Wonderland, in both awe and confusion at what we see and at what we have happening to us...as if on some kind of drug that we can not say no to (Credit). We then listen in nearly total belief when they say that they are doing something about it and will get things back on track and that things will be better in our lives. When will we stop believing that this is some sort of official report? One that means what the face and mouth of the Fed says? Why do we continue to allow them the power to disrupt our lives in this way?
Its just too easy for reports to say that earnings are coming in above expectations when in the first place; expectations have been lowered to the lowest point in how many years???? And what of the housing situation? They don't seem to be reporting on the rising foreclosures in many areas. What of actual bankruptcies? The non-Fed-family banks are expected to go belly up in the hundreds if not possibly a thousand or so. That would not be happening if it was happy days here again would it?
Americans have been lied to now for so long that you just believe anything you hear on the "Official News" or in the daily news papers. So next report that comes out, don't just believe it. Think about it and know that it is NOT a factual report but that of propaganda-speak. Something that those in power feel that they must do in order to keep the peace.
Americans need to take back the power we've entrusted in such people. We've given away our powers as a people for so long that it has been taken for granted and become corrupted. They tell you what you need to hear in "Official" reports so that you do not rise up, like others the world over when corruption goes too far for too long.
From now on, when you hear that this report or that report came out...you should think about something before you take it to heart. You should think about how many reports come out looking rosy in relation to what actually is. Then, just a week or two or a month later the same report looks quite the opposite. Another kind is where the report says that previous data will be changed (in order to make good the numbers in the current report).
So perhaps it would be in your best interest to view these reports as "What is plausible" or "What we'd like it to say" or "What you want to hear" or "Your Title Here". Because if everything was the way they reported it, things sure would be different around here wouldn't they? Instead these seem to be marketing type reports are made specifically for public consumption, not factual ones which tell it like it is. It seems that those who run the government no longer put out those kinds of reports.
Whatever happened to Just the Facts Jack! ??? Instead we get clobbered 24 hours a day via the media to "think" its okay to part with more of our money and put it into the market because the recession has hit bottom and look to the end of the fourth quarter for happy days here again. Have we hit bottom in the market? Maybe, but that doesn't mean that happy days are here again by a LONG SHOT. What with rail shipments down 20% from last year's levels, UPS package levels down 4.7% from last year's depressed levels, unemployment's continuing new claims (how about the massive number of people no longer on benefits but out of work still? How about those who have only been able to obtain part-time employment?) and all these numbers which are not reported because it would look too close to reality which isn't very good!
Hidden Facts:
The number of unemployed persons increased by 466,000 to 14.9 million, and the unemployment rate rose by 0.3 percentage point to 9.7
The number of discouraged workers in August (758,000) has nearly doubled over the past 12 months.
Big layoffs at major automakers, suppliers and dealers are just one of the latest signs that the recession is still hitting the U.S. economy fully
Related drops in consumer spending will continue to affect corporate earnings that will be hard to continue hiding, perhaps even among financials
The majority of this recession was caused by the greed of Federal Reserve leaders and their banking friends via the whole subprime mess and longstanding credit pushing policies.
There has to be 150,000 new jobs each month just to keep up with population increases. Job growth over the last five years has pretty much been wiped out. It took 4.5 years to recover from the job losses of the 2001 recession. With this being the worst recession since The Great Depression do you think we'll be out of the woods in any less time? We would have to add 17 million jobs over the next five years just to get back to the levels we had in 2007 of 4.5% unemployment. Do you think that is going to happen any sooner? Like in 2010 or 2011 at the latest as they are saying on the boob-tube? Really? Oops! There goes another 12,000 jobs...this time from AT&T.
Add to those numbers all the people that aren't reported on any longer, including those who have only part-time work but want full time and those numbers rise to like 23 million new jobs needed to get back to what is normal. So perhaps those in power will come up with a "New Normal" to define so that we won't fret and get upset at them. But wait until "normal" taxation returns! When the need to return to normal taxation levels can no longer be denied. OMG! What will you think then? Your decreased pay-check, or the pay-check that didn't see a cost of living increase in over five years will suddenly be like...OMG! But then it will come from other taxes as well, not to mention the indirect tax incurred because we have allowed the Federal Reserve to put more and more newly printed money into the system from which you are directly indebted for!
Add to this the baby boomers who, thanks to regulatory decreases in the stock market and financial sector, can no longer "afford" to retire because their investments have been largely wiped out. Which puts us on another topic we won't cover here...programs which will be needed by the elderly but will be cut despite the need. A whole new can of worms opens up here, that which would include new poverty reports, not the "official" ones. The last recession "ended" in 2001 as goes the "official" report but unemployment continued to rise till the middle of 2003. Again, this doesn't bode well for us in this...not this bad since The Great Depression-recession of 2009. If only that ringing of Change which ushered in a new U.S. President could have the power to put this country back in the great race to be #1 again. So far we're being out-performed by the likes of China, Germany, Spain, and even South Korea while we're still stuck, sucking on the oil nipple for all that its worth.
They...the U.S. Oil companies want you to be mad at the Saudis for the price of oil. Who made more money last year than any other time in their history???? (U.S. Oil companies) We are the Saudis!!
We've been told from those in the Mid-west that insurance companies are freezing their own clients out of their Annuities for up to twelve months! If you need money and your sources are dried up, demand a hardship dispensation from your insurance company. Does this sound like happy days??
We've also been reminded of how those on Social Security have received notice that their payments won't be adjusted upwards now for several years. This is being blamed squarely on the baby boomers. But in-fact...Social Security has been raided every year to pay for part of the government debt and received nothing but I.O.U.s which have not been honored in a very long time. So its not the Baby Boomer generation that is the problem with the government not being able to do cost of living increases to SS recipients. Whatever happened to Social-"Security" for the lifetime worker in America???
WAKE UP PEOPLE!
Happy days...normal times...won't be upon us until these numbers return to pre 2008 levels. That is when business is doing well again, and orders are being placed regularly for goods and services by business and by the people. Not just because we've run out of inventory which sat for months and now we have to order more or we'd be completely out of business.
The Auriga Leader, the world's first partially solar-powered pure car carrier vessel, docked at the Port of Long Beach for the first time. The ship has been contracted by Toyota to exclusively carry Toyota, Lexus and Scion vehicles to the west coast from Japan.
The 656-foot, 60,000-ton vessel's deck is outfitted with 328 solar panels that can generate up to 40 kilowatts. Unlike other ships outfitted with solar panels that feed power directly to accommodation and cargo-hold lighting, the Auriga Leader feeds power to the generator, which contributes to the whole ship.
The Auriga Leader, operated by NYK Line, was launched in December 2008 and can transport up to 6200 vehicles. NYK Line has set a goal to reduce car carrier energy consumption by 50 percent by 2010 through solar power generation, ship operation improvement, redesigned hull form, propulsion systems energy savings and improved cargo handling.
We've been getting e-mails and voice mails all asking: "how can you print that the recession is far from over, when the DOW has hit 10,000?
Larry Levin says it best in his daily comments:
Dow 10,000! Uh Really?
This has happened before, not too long ago in fact. Each time I turned the channel from one financial station to the other yesterday and this afternoon, I thought I was watching a scandalous XXX movie. I kept hearing, "Oh Yes!...OH GOD, OH YES! That's the stuff 'Big Ben and Timmah'...you know how I like it. Oh my GOD!!" Was I hearing an audio replay of Mr. Spitzer's liaisons with his high priced call-girls? Nope. I was once again witnessing the on-air hosts experiencing multiple DowGasms.
After all, isn't Dow 10,000 exciting? Dow 10,000? Uh, really? Not so much. As usual, the so-called financial experts are not giving you the whole story. And why would they? The truth sucks.
The truth lies with the value of the US dollar. Another great illustration of the amazing loss of purchasing power by the US public are the recent ignorant statements about the Dow at 10,000. While in absolute terms the Dow may cross whatever the Fed thinks is a sufficient mark before its quantitative easing begins to taper off (Dow crosses 10k just as Treasury purchases expire), the truth is that over the past 10 years (the first time the DJIA was at 10,000) the dollar has lost 25% of its value...TWENTY FIVE percent!
On a real basis (not nominal) the Dow at 10,000 ten years ago is equivalent to about 7,500 today! In other words, not only have we had a lost decade for all those who focus on the absolute flatness of the DJIA, but it is also a decade where the consumer has lost 25% of its purchasing power from the perspective of stocks! You won't hear this fact on TV.
You don't believe me? The value of the US dollar only effects high-flying world travelers you say? Huh - that's odd. Then why did President Obama give a special $15-billion "bailout" to the elderly this past February? It was part of the "spendulus bill" in case you forgot. By definition they're already retired so they haven't lost their employment. They are losing their purchasing power, like you, so the Pres stepped in for a lil' bailout.
What else should we expect with trillions upon trillions of new dollars flooding into the system via the Fed's printing machine? It makes the money supply that was available before the money & credit that was created out of thin air worth less than other wise would be.
President Obama, Helicopter-Ben at the Fed, and Tax-Cheatin-Timmy at the Treasury all apparently want the U.S. currency to be used as Kleenex and toilet paper.
With such a great reaction by the media to Dow 10,000, Big Ben and Tax-Cheatin-Timmy must be receiving many messages: "Hey big boy, voulez vous coucher avec moi?"
Trade well and follow the trend, not the so-called "experts."
Consider this - JPM Chase bought WAMU in September of 2008 for all of $1.9 billion dollars. For that they got a bank with almost $310 billion in assets, $188 billion of it bank deposits. Now Chase will tell you that the deal wasn’t that great as they had to absorb a hemorrhaging mortgage portfolio of $176 billion that they immediately wrote down by $31 billion. That’s true, but hides what really is going on.
If you ignore all the other debt and assets, Chase got $176 billion in home loans for $1.9 billion. That’s just over 1% of face value. Assuming an average loan balance of around $300,000, that’s almost 600,000 mortgages and corresponding homes. That means they paid an average of only $3,000 for each of those loans. Even if they foreclose on the ENTIRE portfolio, do you think they can make money by reselling houses they got for $3,000 each? -Loan Survivor
Fact: US foreclosures jumped to an all-time high of 937,840 in the third quarter. According to RealtyTrac that's a 23% rise from the same time last year.
Fact: According to the Mortgage Brokers Association, 58% of the foreclosure starts are now in Prime Loans, not subprime loans.
Fact: 46% of Option Arms are currently 30 days past due. An Option Arm is A monthly adjusting adjustable-rate mortgage (ARM) which allows the borrower to choose between several monthly payment options.
The bottom line is that far too many Americas, not simply those with low credit scores, have borrowed more money then they are realistically capable of repaying. The credit boom was created by initially low adjustable rate mortgages, interest only, or negative amortization loans, and an appreciating real estate market that allowed homeowners to extract equity to help make mortgage payments. Now that real estate prices have stopped rising, and mortgage payments are resetting higher, borrowers can no longer “afford” to make these payments.
According to the Financial Times, JP Morgan's U.S. credit card division lost $700 million in the quarter, it wrote off $7 billion in noncollectable consumer loans. So how is it that they are making profits? JP Morgan took bailout money, paid bonuses, then played the stock market before paying some of the bailout money back which was the profits it made in the market. They also got some multi-billion worth of mortgages for a song and then wrote down some $31 billion of that which means that their profit was a sure thing from the get-go. Yet despite the bailout, JP Morgan is not lending much of anything to spur the U.S. economy. It made more profits recently trading the stock market instead.
Yes there are two sides to every story, sometimes more. But one thing you can count on is that one is right and the others are wrong. Why are they wrong? Because they are telling you a tale, a fictional story. The tale they tell is intended to lull you into believing everything is working out the way you nearly want it to. Don't Worry...Be Happy! Don't Worry, Be Happy! Its like a trance or a song line that repeats to the point that you can't get it out of your head and eventually, you start saying it over and over to yourself. That was the design of the story and you believed it. Now that you're baited, they can tell you anything. You have become the drone captive audience of their lies. Yes, I know...you've heard it here before, but get it into your head...you've got to question everything that they tell you because much of it is no good, still more of it is not the whole story...not the true picture, just twisted-wrung-out tiny truths that you should question how much is just plain baloney!
Hey! If you don't believe me, then I've got some AAA rated securities from 2007 and 2008 that I'd like to sell you!
The Federal Reserve Bank or Fed (not a U.S. government entity but a private syndicate/cartel/group) wants you to believe in all their stories and diversions from the truth. "Things are now much better" they say. "Don't worry. Everything is going as planned and the recession is soon ending, so give us more of your money (via your credit card purchases) and we'll get back to business as usual. Good times are coming soon." But step away and the reality speaks the real truth in both Asia and the West:
Continued weakness in consumption spending in the world's largest economy, the U.S, the consumer sentiment index unexpectedly declined, economic data released one recent Friday in New York revealed.
Exporters, automakers, trading companies and banks declined on concerns about economic recovery.
In China, sea ports are full of product which are not leaving port because the U.S. consumer is not buying. This has forced closures of Chinese manufacturing facilities which produce goods specifically for the U.S. market.
Bank deposits are on the rise which is no longer a good sign within a financial industry that has grown from encouraging customers to buy what they can't afford using credit cards, home equity loans, and the like. Deposits, (those that come in and don't go out in bill payments) mean people aren't spending. It means that they're doing the right thing for a change. Meanwhile bank's non-performing assets are also on the rise which will continue to hurt these institutions in the coming quarters.
Banks which are not intimately connected to the Fed, hence not one of the Friends of the Fed are going to be failing in large numbers. They aren't privy to the bailouts already given to the Friends of the Fed.
We know that the Federal Reserve has inaugurated a policy of aggressively buying Treasury bills, agency debt, and mortgage-backed securities as part of what is often described as Quantitative Easing. The numbers are hard to absorb: $300 billion of Treasuries, $200 billion of agency debt, and $1.2 trillion of mortgage-backed securities, all between March and September.
The Fed doesn’t tell us whom they buy their Treasuries from, but it seems likely to be the same big banks that serve as primary dealers buying the debt from the government. The primary dealers appear to be holding a slice of this paper for only a short term before selling it on to the Federal Reserve. The net of those transactions becomes a further monetization of the federal debt. So whats going on here?
Lets see:
Banks buy debt and sell it to the Fed for profit.
Banks take the extra money and invest in a distorted market for more profit.
What have they actually done? Essentially nothing. All that really happens is that the banks get free money from the Fed so that they can "legally" make more money. The Fed takes the debt and contracts it to the U.S. Government/The Tax Paying U.S. Citizen. The Tax-Payer is on-the-hook for his/her lifetime including the lifetime of their children. Yet another scheme to make banks even more money!
Remember: The Fed makes money from nothing. It costs them only a few pennies to have their own Federal Reserve Notes (not backed by anything of worth/value, it is FIAT money). They loan out this paper via contract to the government who then guarantees that every U.S. citizen will be taxed in some way and that money will go to the Federal Reserve Banks. The IRS is a tool that exists only to serve the Federal Reserve Bank obligation.
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So even in times of recession or economic downturn, the Federal Reserve & Friends are making money on the backs of the same people it busted in causing the recession, in order to make even more money. I hope that is simple enough for most of you to understand.
The Fed is also buying even more mortgage-related debt. With the government now guaranteeing mortgage-backed securities, those securities are not that much more risky than actual government debt. This gives the Fed further rationale for having purchased almost $600 billion of mortgage-backed securities since March. Which brings us to a likely connection to the speed of the stock market rebound since March 2009. Looking through the evidence today, we can see that the Federal Reserve has purchased close to $250 billion in Treasuries, and that may have provided the liquidity needed for the big banks to turn around and dump new cash into stocks. Goldman Sachs made upwards of $100 million (per day) on many days through its trading activities in just one quarter alone. You can compare the surprising stock market rally to the Fed’s purchases of Treasuries. You can likely suspect despite what they say in the media, that our stock market is far more manipulated than most people realize. As a cautionary note, many of the emergency programs of making direct loans to financial institutions are being wound down by the Federal Reserve at the same time it is focusing on direct purchases in these specific markets. Those countervailing actions have kept the total balance sheet of the Federal Reserve relatively stable since it doubled in the second half of 2008, but that could quickly change if the Fed wanted to launch new programs.
So we are the Fed's important game pieces in a giant profit-making game. The Fed is the game's creator, rule-changer, banker, and extra player, all rolled up into one entity. The Friends of the Fed are additional players in their game. Try as we might, or not so much, the odds are heavily stacked against us (the tax-paying American). In fact, the way the Fed writes the rules, there is no way that You and your family members have any chance to beat the game. And to not play?? Well, its not an option at this point because your leaders have opted you, your family, friends, and co-workers into the game. After all, your leaders are your representatives and they do so on your behalf. Don't you like those odds?
American consumers are in debt to the tune of $2.5Trillion dollars. This is part of what makes the Fed & Friends continue to find new ways to entice you to buy even more of what you can not truly afford. It is why they lower interest rates. It is why they shower you with credit card offers with perks for using them. But what the banks don't want you to do is to save your money and liberate yourself from your credit cards.
What is the fastest way to save money? Stop using credit and pay off your cards. Those little devils in your purse or wallet are constant temptations to buy something today and pay for it tomorrow. Problem is...you pay, and pay, and pay some more for the privilege of a little piece of plastic. Is it really worth it? Since the start of the recession, banks have been raising interest rates on the average consumer. They know that many are in trouble (reduced wages, hours, or both) they know that you will rely on the card for quick cash or that special present to yourself, even groceries this week and next. So they're jacking up the privilege as much as 29.9% for many. Banks aren't your friend, they only pretend to be.
They fill your statement envelopes with more offers and ways to get the most out of that card and to get the most out of you! They'll even offer to have you skip a payment or two...isn't that nice of them? What they will ever rarely do is suggest that you stop using the card and save hundreds to thousands of dollars a year in interest payments. Even carrying a fairly low balance can eat up valuable buying power if your interest rate is in the double digits.
The banks won't tell you to follow their lead. Banks got overly greedy again and continued with criminal-like zest despite the risks. They got themselves in trouble. What to do? Walk away from the problem/or shove it to the consumer, the tax-payer, the hand that feeds them. The very financials that walked off with big bonuses did so at your expense while your buying power diminished further and your investments shriveled under the heat. You could follow one from their own play-book and walk away from this wholly lopsided obligation. Why should you pay when they addicted you to easy credit? These dealers are the bad guys here, not you. You are just weak minded and they like that an awful lot don't you know? So stop paying more interest on owed interest and fee upon fee. Or what about this: How much are all the bailouts worth on a per tax-payer level? Thats your leverage, your credit, your payment towards the account!
War...Its All About Money, Even At The Cost of Lives!
Think of what you could do with all the money you will save by not using credit. My Father never borrowed money. He wasn't interested in credit. He saved for his homes, cars, and vacations. The savings he amassed by not paying for what he could not afford, allowed him to invest and have a decent retirement account for himself and his wife. While he enjoyed working, he did not have to ask his wife to work because of necessity, except in the very beginning, nor did he need to seek part time work to make ends meet. Not borrowing from the banks or living with credit was a financial boon for he and his spouse. Sure they worked
hard and pinched pennies when needed. But in the end, they didn't need to worry about not having enough to take care of themselves.
"Mr. Geithner, in a letter to U.S. lawmakers, said that the Treasury projects that the current debt limit could be reached as early mid-October. Increasing the limit is important to instilling confidence in global investors, Mr. Geithner said. The Treasury didn't request a specific increase in the letter."
Do you think this is a wise move? Our debt with respect to GDP is currently reaching into the 90% range with the U.S. expected to be fully extended by some time in 2010.
It seems that this is a blatantly irresponsible move from a fiduciary standpoint. So I guess the question is: Does Mr. Geithner have an ethical duty to act in the best interests of the people of the United States?
Obviously the Federal Reserve wins by the debt limit being raised again but do the people? What happens when debt to GDP reaches 100% or more?? This means even more than saying that your personal credit is maxed out!
Since the Federal Reserve makes money from absolutely nothing, (we are not on the gold standard anymore) it would be a huge deal to forgive all debt to-date owed to the Fed. It would do an awful lot it seems to help this country out. After all, its not like the Fed is in any kind of financial trouble. After all, they got us in this mess with their money-making schemes. It seems only fair!
Now on the other hand we've been hearing from the media in an almost droning-like way, that the recession is near its end. Even Bernanke says that the recession has ended. They say that all reports indicate this...well, those reports as we all know have had their data skewed and manipulated in order to make things look rosier than they really are. AND...when the new report is dramatically different than the previous report, they have to re-manipulate all the past data to come into line with the current report. See what I mean?
As recently in 2005-2006 Bernanke said that the U.S. Housing Market is fine and is properly valued. He said that the U.S. is on the path to full employment. Bernanke said that we have a strong future economic growth and boom in exports. To that we simply say: HUH??? Whats you talkin about Bennigins? He obviously doesn't have a serious clue in his body about whats going on unless he's told by those who are really running the show. He's just the puppet on the marionette stage.
Then they point to a lower unemployment claims number and say that this is the biggest proof. Well it seems to us that all that means is that the big wave of layoffs deemed necessary by companies as a cost-cutting device is slowing. It does not mean that near 15 Million people are not still out of work, it does not mean their lowered hours, trimmed wages, or reduced benefits have returned. It does not mean that consumer spending in the retail sector has returned either, nor has discretionary spending. How do we know this? Because brand new manufacturing cities in China had their gates closed to workers returning from Holiday.
This means that the west is not buying. Furthermore, sea ports in China have containers stacked as high as they can possible go and they're filled with product for the west. But it isn't being shipped because there are no buyers. Many real estate markets in the U.S. are still seeing record foreclosure rates. Global shipping companies are bobbing in the ocean rather than going full steam ahead because there is little to ship now a days. Banks still are not lending and this is the biggest indicator! Sadly even banks and mortgage companies are being caught trying to lend to people who shouldn't be borrowing. Those financials should be closed and taken over immediately by responsible institutions. When all this reverses, perhaps then we can say that the recession is ended. Why must they put the proverbial cart before the horse?
Others are pointing to the recent stock market rally saying that the per- severance of the bulls is proof that the recession has ended. Seems to me that maybe this is just another but rather longer bear rally. Even though economists are all calling for the end by the fourth quarter of 2009, these folks almost always lag the market with their opinions. Wasn't the economists that were partying over the economy in 2007 when the market was at all time highs? This was also the point where it all started unraveling.
During the Great Depression, there were eight distinct stock market rallies. The rallies lasted an average of 11.3 weeks during which time the average increase was 52.6%.
The rally that began in March of 2009 is now 29 weeks long and has seen the S&P 500 rise 58. percent. Which is to say, it is now double the average duration of the average bear market rally during the Great Depression.
More interesting is that the current rally is eerily parallel to that of the longest bear market rally of that era – a 52% rally that came at the very beginning of the depression and lasted 22 weeks.
Since history has a way of repeating itself as it has time and time again...the folks here at Future1investors group will wait for something much more indisputable before we start saying and writing that the recession has indeed ended. Until then, we are preparing for a longer road back to recovery. A road we feel must include one well traveled by new innovations and technologies that have mass benefits as in things like alternative energy. We are quick to blame the Saudi's for the price of oil, yet our very own American Oil Companies just saw the most profitable year in the entire history of the black gold!
Seems more responsible to work this way rather than throw caution to the wind, only to be let down yet again. Aren't you tired of it?
This was started by a long-time entrepreneur who was forced into corporate service by the Dot.com crash which wiped out $5-Trillion in market value of technology companies from March 2000 to October 2002.
See March post: Deja Vu.
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