Das Kapital, Part II: Congress, Presidential Wanna Be's, Wall Street and now Fed Chairman Bernanke all want the government to kiss the mortgage problems and make them go away. Strange place for socialized medicine.
Morton Moment: The cyclone struck Myanmar just as farmers were harvesting the dry-season crop, which accounts for 25% of the country's annual production. Seawater, surging 35 miles inland, deposited a layer of salt, ruining the crop and damaging the land's fertility. First it rained, now it poors..
So Bad It's Good: The Clinton/McCain proposal to suspend the federal gas tax for the summer is a silly idea with two things to recommend it: It won't cost much - $9 billion is a cheap way to calm the populace. And it may keep Congress from doing something much worse.
Shallow End of the Pool : Financial services provider State Street is facing over $7 billion in claims from losses its clients suffered in sub-prime mortgage backed securities. These claims are 12 times the reserves State Street has set aside for such claims.
Junkies : US consumers continue to increase their borrowing - now at a 7.2% annual rate. If you can't ATM your house and you've already hocked the blender, the only thing to do is to hit the plastic - because wages sure aren't going up 7.2% a year. Pay it back?
Going, Going: A survey of bee health reports 36% of the nation's commercially managed beehives have been lost since last year.
Tantrum: The Pentagon says that if Congress does not raise its allowance for wars and toys it will continue to borrow money from the Army's payroll account to fund them. If the parents don't give in, the Pentagon will stop paying the soldiers and hold its breath for a really long time.
Small Cheer: Scientists have rediscovered the greater dwarf cloud rat, which was last seen 112 years ago. It had been long thought be extinct.
Garage Sale: Citigroup continues to "strengthen" its position. After several rounds of stock issues that have diluted stockholder equity, the company is now going to try to get rid of $400 billion in non-core assets. Would 'non-core' a good name for a basset hound?
Optimism: Rep Shimkus (R-ADM) reassures the starving that using corn to make ethanol is only "a bridge (to) cellulosic ethanol, and we can't jettison the present and not get to the future". He did not reflect on jettisoning people.
Hungover: Excess housing construction as a percent of GDP shows the US at a benign 7.1% while Spain's is 24.6% and Ireland's a stupendous 44.3%. It will take a long time for that binge to wear off.
Big Brother's Worried: The US intelligence community says “left unaddressed, climate change may come to represent as great or a greater foreign policy and national security problem” than the war on terror, the wars in Iraq and Afghanistan, energy security, and current economic instability.
Innate It Aint! Young songbirds babble before they can mimic an adult's song, much like their human counterparts. They practice incessantly until they get it right, unlike their human counterparts.
Last Resorts: Fannie and Freddie now back 98% of home loans sold by banks. Together they have over $5 trillion in mortgage business, backed by $90 billion in capital. Simple division: A 2% drop in average mortgage value wipes out their capital. They are not, however, the 'lenders of last resort'. You are.