Category: Economy

Where did our 2 TRILLION dollars go, Ben Bernanke?

   Watch Senator Bernie Sanders as he spoke today for almost a half and hour in one of the greatest speeches the Senate has ever seen.

    I will be adding some quotes from this video in updates. I wanted to get this video published fast, because I think this is a matter of utmost importance.

    Are we looking at a Huge Scam?

~ Senator Bernie Sanders (I-VT)

    The American people have a right to know where TRILLIONS of dollars of their tax payer dollars are going!

~ Senator Bernie Sanders (I-VT)

    Why did the Fed argue that this information must be kept secret as a matter of National Security?

~ Senator Bernie Sanders (I-VT)

     Congress required the Treasury Department to disclose who received TARP money, why is it wrong to demand the same of the Federal Reserve?

   

Crude Oil Futures: Crude Oil Tops $100 for 2018 on Threat From BP Spill

Energy Markets

Margot Habiby, Bloomberg – May 5, 2010

Crude oil futures for delivery in 2018 surged above $100 a barrel this week as the BP oil spill in the Gulf of Mexico led the government to consider a halt in future drilling.

The crude oil futures contract dated furthest into the future jumped after President Barack Obama said no new offshore drilling leases should be issued until a “thorough review” of the April 20 rig explosion. […]

Crude oil futures for delivery in December 2018 rose to $100.38 a barrel May 3 on the New York Mercantile Exchange, the highest settlement since Jan. 20. […]

“You may not pay today, but we will pay tomorrow,” Phil Flynn, vice president of research at PFGBest in Chicago, said in a report.

[…]

“That $100 oil equates to pretty close to $4 a gallon gasoline” in the U.S., said Bruce Bullock, director of the Maguire Energy Institute at Southern Methodist University in Dallas. “We know when it hit $3 a gallon two years ago drivers started to get concerned, and at $4 a gallon demand evaporated.”

  The financial crisis that grips our nation’s states and cities has a malicious source, and Governor Tim Pawlenty recently named that source: public school teachers.

 “It used to be that public employees were underpaid and over-benefited. Now they are over-benefited and overpaid compared to their private-sector counterparts.”

 The school teacher, the policeman, the firefighter – these are now the faces of what is wrong with America today. It doesn’t matter that studies by the Bureau of Labor Statistics say otherwise, America can no longer afford their overpaid, middle-class salaries.

  At least that is what the right-wing media is telling us. Tea party members also want to see a drastic pay cut for the same people who teach their children. A familiar comment on the internet is, “I took a pay cut last year. Why shouldn’t they?”

  This attitude goes beyond schadenfreude and goes straight to the crabs in a bucket mentality. Strangely enough this attitude of “if I can’t have it, neither should you” only extends to working class people who live next door. For some reason none of the jealousy and malice is reserved for the people who actually broke the budgets of the states and cities, i.e. the people who deserve it.

This was a stunner.  

With all the hoopla about how America desperately needs to become “Energy Independent” — and SO the “urgent need” to Drill off OUR Shorelines — well it turns out, all that Drilling and Spilling, is just for Barrels of Oil, destined for resale on the World Markets!

Turns out — “Our” Gulf Oil is just another “fungible global commodity“!

Huh, what?  Fungy-what?   Does that mean it’s “more fun”?

No.  Fungible simply means something is “interchangeable”.  That One unit of something (like a barrel of Oil) is worth just as much as any other Unit of that same something.  One Ounce of Gold, is exchangeable with any other Ounce of Gold.

Or as Chris Hayes succinctly put it:

There’s NO barrels marked somewhere, “Foreign.”

Say What?  I thought we were risking our precious Ecosystems, to “free ourselves” from the need of Foreign Oil — to increase our “Domestic Reserves”?

If British Petroleum, can pump it and dump it, on the Global Marketplace, where one Barrel of Oil is identical to every other Barrel (assuming no disastrous spills of course) —

Then what the Hell is the Point?

Cross-posted many places including DailyKos.

On Thursday afternoon the AFL-CIO held a rally to protest the banking bailout and demand a peoples’ bailout. There was a call for not just regulating the banks that almost took this nation down but also doing an about face and forcing the bankers to bailout the people.

Do you think Wall Street should pay for the jobs they destroyed?

“People in New York and across the country who did nothing wrong and want to work have paid for the misdeeds of the big banks with their jobs, homes and retirement savings,” said Richard Trumka, the A.F.L.-C.I.O. president.

Do the elected officials of this nation think Wall Street should pay for the jobs they destroyed?

See a few photos and read some people’s stories below.  

  These are strange days. There was a time when there was a clear divide between fiction and reality, but those days are passing. For instance, this amusing article from Andy Borowitz.

  (The Borowitz Report) – Eleven indicted Somali pirates dropped a bombshell in a U.S. court today, revealing that their entire piracy operation is a subsidiary of banking giant Goldman Sachs.

  There was an audible gasp in the courtroom when the leader of the pirates announced, “We are doing God’s work.  We work for Lloyd Blankfein.”

 The article was meant to be snarky and not taken seriously, but those are the kind of stories you have to keep the closest eye on. They tend to have a way of transforming from punchline to headline.

“I have always noticed that people will never laugh at anything that is not based on truth.”

 – Will Rogers

Healthy Economies are based on Minimizing Costs, while Maximizing the Social Benefits.   Or at least they should be.

Yet our Corporate-driven Economic system, far too often focuses on Discounting the Costs, while Maximizing their Profits.   Profits for the enlightened owners, NOT for Society at large. Both the long-term and local Costs, generally get swept under the rug, in such a competitive landscape.

And that is a recipe for long-term Planetary Disaster.

Every economic transaction is some sort of trade-off between Cost vs Benefits.   Problems arise however, when most of those Costs (to the Planet and to Society) remain Hidden, just below the surface — completely “External” to any quick-hit P&L calculations and Statements.

The accurate Pricing of such “External” factors — both short-term and long-term — is KEY to whether or not, WE leave the world a better place than we found it.

“Externalities” have a way of creeping up on you, and “extracting payment”, sometimes when you least expect it.  

Crossposted at Daily Kos

THE WEEK IN EDITORIAL CARTOONS

This weekly diary takes a look at the past week’s important news stories from the perspective of our leading editorial cartoonists (including a few foreign ones) with analysis and commentary added in by me.

When evaluating a cartoon, ask yourself these questions:

1. Does a cartoon add to my existing knowledge base and help crystallize my thinking about the issue depicted?

2. Does the cartoonist have any obvious biases that distort reality?

3. Is the cartoonist reflecting prevailing public opinion or trying to shape it?

The answers will help determine the effectiveness of the cartoonist’s message.

:: ::

Bill Day, Comics.com (Memphis Commercial-Appeal)

  The news started today with S&P downgrading Greek bonds to junk. It wasn’t just the sovereign debt that became junk, but also the debt of many of the major Greek banks as well.

  This dramatically increases the risk of default because junk rated bonds cannot be swapped for Euro-backed bonds, and this has markets very worried.

 Investors in Greek bonds may get back between 30 percent and 50 percent of the value of their holdings should the government default or restructure its debt, S&P said.

Warren Buffet gave a prophetic pronouncement back in 2003 about the Derivatives market, seeing the exponential dangers of this “paper-thin” type of investment.

Buffet did not mince words. He called them “financial weapons of mass destruction“:

Buffett warns on investment ‘time bomb’

BBC – 4 March, 2003

The derivatives market has exploded in recent years, with investment banks selling billions of dollars worth of these investments to clients as a way to off-load or manage market risk.

But Mr Buffett argues that such highly complex financial instruments are time bombs and “financial weapons of mass destruction” that could harm not only their buyers and sellers, but the whole economic system.

[…]

Some derivatives contracts, Mr Buffett says, appear to have been devised by “madmen”.  […]

http://news.bbc.co.uk/2/hi/bus…

These types of announcements have been coming now on an almost regular basis and not only as to the States leaders but out of the Veterans Administration as to Stimulus money, some with added budget funds if there, being used to add VA Clinics, new VA Hospitals or upgrade those already in existence, State and Federal Veterans Cemeteries expansions and new ones.

  Over a year ago Fed Chief Ben Bernanke made a very clear statement for what needed to be done.

 “If actions taken by the administration, the Congress, and the Federal Reserve are successful in restoring some measure of financial stability — and only if that is the case, in my view – – there is a reasonable prospect that the current recession will end in 2009 and that 2010 will be a year of recovery,” Bernanke said in remarks to the Senate Banking Committee in Washington.

  It seemed to make sense. The collapse of the financial system was what caused the Global Recession, so stabilizing the financial system appeared to be a necessary condition to get out of it.

  Eight months later the IMF declared that stability was returning to the financial system. There certainly are signs that the financial system, because of massive government intervention, is repairing itself. Borrowing costs have dropped. Securities markets have reopened. Large banks are better capitalized.

 But is that the whole story? I’ve taken a look at the raw numbers and they show something very different.