Tuesday, September 6, 2011
UBS Says Save Us or Tanks In The Streets
UBS - The Swiss bank has come out with a report that declares that "The Euro Should Not Exist,"
which examines the problems of dealing with a Euro breakup. This story was broken by Zero Hedge and can be read here. This report is echoing German sentiment that it is time for the Euro and the European Union to end. However, the UBS report uses the "Hank Paulson Treatment" of a gun to the head of politicians across Europe with scare tactics that demand bail outs or there will be tanks in the streets.
This tactic worked in America in 2008 and we expect that it will work in Europe as well. On Wednesday, the German Federal Constitutional Court will make its decision on the legality of German loans to the ECB for bailouts and if it is legal for the European Central Bank to buy the bonds of failing nations. I expect that the German Federal Court will vote to allow the ECB to buy bonds and let Germany make loans to the ECB. They don't have any choice. If they don't vote to allow bailout money, Europe blows up on Thursday. Even if they do vote for the bailouts, problems persist in Germany.
The German Cabinet may have approved new powers for the Euro's bailout fund and the EFSF but German Chancellor Angela Merkel lost a test vote for the bailout fund yesterday. Greece has been the thorn in the side of the European Union needing bailout after bailout and is putting into question the viability of the Euro as a currency. This is what is driving the problems in Germany. The last two years of crisis have caused the Germans to question the Euro. 76% of Germans question the viability of the Euro, this is up 5% in just the last two months. The German people are tired of carrying Europes economy on their backs. They are still smarting from German Unification and the environmental cleanup of Eastern Germany. They don't want anymore bailouts. The German politicians, aren't listening and don't care. This will make for a caustic mix of priorities that will end up blowing up German politics as we know them.
So what will happen on Wednesday? The German Federal Court will vote to continue bailouts. I think you will start seeing a groundswell of anger towards bailing out Euroland PIIGS in Germany. So much so, that there will be rioting in Germany and Merkel's government will fail, which will be the end of the European Union as we know it today. Look for signs of tension starting next week.
which examines the problems of dealing with a Euro breakup. This story was broken by Zero Hedge and can be read here. This report is echoing German sentiment that it is time for the Euro and the European Union to end. However, the UBS report uses the "Hank Paulson Treatment" of a gun to the head of politicians across Europe with scare tactics that demand bail outs or there will be tanks in the streets.
This tactic worked in America in 2008 and we expect that it will work in Europe as well. On Wednesday, the German Federal Constitutional Court will make its decision on the legality of German loans to the ECB for bailouts and if it is legal for the European Central Bank to buy the bonds of failing nations. I expect that the German Federal Court will vote to allow the ECB to buy bonds and let Germany make loans to the ECB. They don't have any choice. If they don't vote to allow bailout money, Europe blows up on Thursday. Even if they do vote for the bailouts, problems persist in Germany.
The German Cabinet may have approved new powers for the Euro's bailout fund and the EFSF but German Chancellor Angela Merkel lost a test vote for the bailout fund yesterday. Greece has been the thorn in the side of the European Union needing bailout after bailout and is putting into question the viability of the Euro as a currency. This is what is driving the problems in Germany. The last two years of crisis have caused the Germans to question the Euro. 76% of Germans question the viability of the Euro, this is up 5% in just the last two months. The German people are tired of carrying Europes economy on their backs. They are still smarting from German Unification and the environmental cleanup of Eastern Germany. They don't want anymore bailouts. The German politicians, aren't listening and don't care. This will make for a caustic mix of priorities that will end up blowing up German politics as we know them.
So what will happen on Wednesday? The German Federal Court will vote to continue bailouts. I think you will start seeing a groundswell of anger towards bailing out Euroland PIIGS in Germany. So much so, that there will be rioting in Germany and Merkel's government will fail, which will be the end of the European Union as we know it today. Look for signs of tension starting next week.
Blew Through The Debt Ceiling Already
You may not have noticed the Daily Treasury Treasury Statement for September 1st, 2011. This is a daily statement concerning the cash and debt operations of the United States Treasury. Seems we have blown through all of that debt ceiling cash we put aside after all of the rancorous debate in Congress last month. Take a look at the Treasury Chart - Table III-C Debt Subject to Limit - for last week.
Whoa! Looks like that debt ceiling is toast. I guess all of the best minds in Washington D.C. and the big brains at The Fed took great care to find the correct number for the debt ceiling. If you recall all of the politico's agreed that this debt ceiling raise would get us through the next presidential election cycle and into 2013.
Oooooops! Guess not. I guess they will all be saying they didn't see it coming and we had no idea.
If you or I blew through our credit lines like itchy sailors on shore leave, they would take away our credit and charge us with fraud. Not the US Government. They don't have to follow rules or take responsible actions regarding spending.
Their mantra.....DO AS I TELL YOU, NOT AS I, A PUBLIC SERVANT, WHO WANTONLY DISREGARDS THE RULES DOES!
Expect higher taxes and higher costs for goods and services. Gonna have to eat some peas. Mr. Obama and Congress are going to have to eat more crow. Seems like crow is on the menu everyday in Washington.
Whoa! Looks like that debt ceiling is toast. I guess all of the best minds in Washington D.C. and the big brains at The Fed took great care to find the correct number for the debt ceiling. If you recall all of the politico's agreed that this debt ceiling raise would get us through the next presidential election cycle and into 2013.
Oooooops! Guess not. I guess they will all be saying they didn't see it coming and we had no idea.
If you or I blew through our credit lines like itchy sailors on shore leave, they would take away our credit and charge us with fraud. Not the US Government. They don't have to follow rules or take responsible actions regarding spending.
Their mantra.....DO AS I TELL YOU, NOT AS I, A PUBLIC SERVANT, WHO WANTONLY DISREGARDS THE RULES DOES!
Expect higher taxes and higher costs for goods and services. Gonna have to eat some peas. Mr. Obama and Congress are going to have to eat more crow. Seems like crow is on the menu everyday in Washington.
Monday, September 5, 2011
Europe Blew Up Today
DAX down 5.28%
FTSE Down 3.58%
Hang Seng Down 2.95%
Euro banks down
Gold up to $ 1,900.00
Europe down 5% overnight on new recession fears and the global financial
crisis continues.
More pressure on Italy to balance its budget commitments.
Chancellor Angela Merkel of Germany and her Christian Democrats lost 5% of their last count to the Center Lefty Social Democrats.
What does that mean to you?
America has a ton of exposure to Europe through American banks partial ownership of many Eurobanks. Greece is looking for more bailout money
and Germany and Finland are questioning anymore bailout money.
Here Obama will speak to the nation on thursday and propose spending
$2.2 Trillion on Innovative Infrastructure and Sector Specific Relief.
This is Poli-speak for I am giving more money to Wall Street, The to Big to Fail Banks and Businesses who give me big donations and am telling the American people to pay for this plan. Big problem Mr. O, where are we gonna get it? Don't think China or Euroland will be buying our Treasuries any time soon.
Look for more of the same here tomorrow as S & P futures are down 2%.
FTSE Down 3.58%
Hang Seng Down 2.95%
Euro banks down
Gold up to $ 1,900.00
Europe down 5% overnight on new recession fears and the global financial
crisis continues.
More pressure on Italy to balance its budget commitments.
Chancellor Angela Merkel of Germany and her Christian Democrats lost 5% of their last count to the Center Lefty Social Democrats.
What does that mean to you?
America has a ton of exposure to Europe through American banks partial ownership of many Eurobanks. Greece is looking for more bailout money
and Germany and Finland are questioning anymore bailout money.
Here Obama will speak to the nation on thursday and propose spending
$2.2 Trillion on Innovative Infrastructure and Sector Specific Relief.
This is Poli-speak for I am giving more money to Wall Street, The to Big to Fail Banks and Businesses who give me big donations and am telling the American people to pay for this plan. Big problem Mr. O, where are we gonna get it? Don't think China or Euroland will be buying our Treasuries any time soon.
Look for more of the same here tomorrow as S & P futures are down 2%.
Why You Have To Think For Yourself
It is truly amazing to see the lack of insight, understanding and math skills wrapped up in a noble prize winning economist. Yet Paul Krugman of the N.Y. Times proves daily and hourly - in his blog - how woefully lost and out of touch with economic reality he has become.
In today's N.Y. Times piece "On The Inadequacy of the Stimulus" he argues that the Fed didn't spend enough money to get the economy going. That is truly myopic. We didn't just do one stimulus package, we have done 5 since 2008 and everywhere you look pundits and economist's like Krugman are calling for a bigger QE III! Are you all insane!?! What?!? You don't believe we have had 5 stimulus packages?!? Follow the Money...Start with the Original TARP and give away monies to AIG & the Auto Industry. $ 540 billion to backstop money market funds in 2008, Obama's $ 787 Billion TARP II stimulus in January of 2009, QE Lite in August of 2010 and QE II in November of 2010 and they are clamoring for another and most likely will get it. Why hasn't any of this stimulus worked and why won't the next QE work? Simple. Fraud and Greed. The money has been spent on speculation on Wall Street in search of big gains and bigger bonuses and has completely missed Main Street with loans to new businesses and industry. It all about jobs, Mr Krugman, and sitting in an ivory tower pontificating about whether consumers will stop saving and spend again is idiotic. The American public can't spend without a good paying job! They can't buy a house or pay the mortgage without a good paying job! They can't move the economy forward while working at Walmart. Hey Krugman!, It's all about good, family supporting jobs that don't exist in America anymore, they have been outsourced to China & India!
In today's N.Y. Times piece "On The Inadequacy of the Stimulus" he argues that the Fed didn't spend enough money to get the economy going. That is truly myopic. We didn't just do one stimulus package, we have done 5 since 2008 and everywhere you look pundits and economist's like Krugman are calling for a bigger QE III! Are you all insane!?! What?!? You don't believe we have had 5 stimulus packages?!? Follow the Money...Start with the Original TARP and give away monies to AIG & the Auto Industry. $ 540 billion to backstop money market funds in 2008, Obama's $ 787 Billion TARP II stimulus in January of 2009, QE Lite in August of 2010 and QE II in November of 2010 and they are clamoring for another and most likely will get it. Why hasn't any of this stimulus worked and why won't the next QE work? Simple. Fraud and Greed. The money has been spent on speculation on Wall Street in search of big gains and bigger bonuses and has completely missed Main Street with loans to new businesses and industry. It all about jobs, Mr Krugman, and sitting in an ivory tower pontificating about whether consumers will stop saving and spend again is idiotic. The American public can't spend without a good paying job! They can't buy a house or pay the mortgage without a good paying job! They can't move the economy forward while working at Walmart. Hey Krugman!, It's all about good, family supporting jobs that don't exist in America anymore, they have been outsourced to China & India!
Bloody September
Looks like tax income from corporations has fallen off a cliff since June
and there can be no doubt left that we never left the recession.
Lee Adler from the Wall Street Examiner's thoughts follow.
Read More.....
and there can be no doubt left that we never left the recession.
Lee Adler from the Wall Street Examiner's thoughts follow.
Bloody September
The following paragraphs are free excerpts from today’s Wall Street Examiner Professional Edition Treasury update. The subscriber link to the complete report is below.
As I estimated last week, the Treasury needed more cash than originally scheduled, or originally forecast by the TBAC. It announced a big cash management bill on Monday, and another one on Thursday to be auctioned next week. That should be enough for now, but revenues appear to be going off a cliff, with declines in withholding taxes now at the point where withholding is down year to year in real terms. That’s after being up strongly in May. It suggests that the US“conomy” entered recession over the past couple of months. Meanwhile, while the evidence suggests that the conomy has already beenin recession, mainstream conomist pundits continue to argue about whether the conomy will have a double dip or not. While they are trying to figure it out, the damage to the financial markets is fait accompli, and will get worse.
Month to date excise taxes as of August 31 were down by 10%, compared with virtually unchanged at the end of July. Part of this was due to the temporary expiration of the aviation excise tax from July 23 to August 5, when it was reinstated. Since the tax was again being collected since August 7, most of the decline in the tax does appear to be due to less driving, drinking, smoking, air travel, and firearms purchases, in other words, all the fun stuff, among other things. The data suggests that the economy fell off a cliff in August.
Corporate taxes were down 23%, month to date versus last year. This is a sharp deterioration from the year to year change at the end of July when it was only down 17%. Because these are estimations based on the most recent quarterly activity, they suggest weakening economic activity. However, we must note that July and August are not months when quarterly taxes are due. The last big collection month was June. September is the next.
As I estimated last week, the Treasury needed more cash than originally scheduled, or originally forecast by the TBAC. It announced a big cash management bill on Monday, and another one on Thursday to be auctioned next week. That should be enough for now, but revenues appear to be going off a cliff, with declines in withholding taxes now at the point where withholding is down year to year in real terms. That’s after being up strongly in May. It suggests that the US“conomy” entered recession over the past couple of months. Meanwhile, while the evidence suggests that the conomy has already beenin recession, mainstream conomist pundits continue to argue about whether the conomy will have a double dip or not. While they are trying to figure it out, the damage to the financial markets is fait accompli, and will get worse.
Month to date excise taxes as of August 31 were down by 10%, compared with virtually unchanged at the end of July. Part of this was due to the temporary expiration of the aviation excise tax from July 23 to August 5, when it was reinstated. Since the tax was again being collected since August 7, most of the decline in the tax does appear to be due to less driving, drinking, smoking, air travel, and firearms purchases, in other words, all the fun stuff, among other things. The data suggests that the economy fell off a cliff in August.
Corporate taxes were down 23%, month to date versus last year. This is a sharp deterioration from the year to year change at the end of July when it was only down 17%. Because these are estimations based on the most recent quarterly activity, they suggest weakening economic activity. However, we must note that July and August are not months when quarterly taxes are due. The last big collection month was June. September is the next.
Read More.....
No New Jobs In August, You Should Be Scared!
Well the August 2011 BLS Employment numbers came out on Friday and they added a big goose egg to the new employment rolls. That's right! zero, nada, nothing. No new jobs were added! Economists say that you need at least 125,000 to 150,000 new jobs a month to absorb new job seekers into the market. In August we had none. So on top of the 125,000 new job seekers we added in August 2011, we have at least 15 million additional American also looking for a job. Funny enough, the unemployment rate didn't change, but should have gone up at least 1 point with these numbers. It didn't. Thank God for government statisticians!
So how do they save such a bad jobs report?
Also another bit of government slight of hand happens every month in the BLS statistics called the Net Birth-Death model. It adds and supposedly subtracts various job categories to "help" smooth out the job numbers during the year. Yes, the Birth-Death model is used in all of the government numbers, but they are constantly used to lie and deceive. This month the Birth-death model added 87,000 ghost jobs to the figure and they still weren't able to show jobs added to the economy. Since March of 2011 the Birth Death Model has added 700,000 net ghost jobs to the BLS employment numbers while their adjusted numbers numbers are showing 237,000 less Americans employed since March 2011.
Guess which one is closer to reality?! Neither. Shadow Stats numbers that look behind the bogus numbers the government pounds out show that we really have over 22% unemployment and or underemployment in the USA.
We are heading in the wrong direction and the lame QE III stimulus - More debt we can't pay - or bailing out the "To Big To Fail" businesses while ignoring Main Street is creating a economic abyss that neither Congress or Mr. Obama have been willing to openly deal with the American public.
Time to stop asking the people to eat their peas, Mr. Obama, and demand that Congress make wholesale changes and cuts to spending. Time to make Wall Street & The Big Banks eat their peas and stop the defrauding America.
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