Producing numbers isn't the same as producing wealth.
Asked and answered: Can Eurobanks survive a Greek default? Probably not, certainly not without massive government bailouts – which seem unlikely to be offered. Société Générale is not enamored of bailing out Greece: “Any 'help' given to Greece merely delays the inevitable break-up of the eurozone.” That's French for 'Let 'em freeze in the dark.' But the problem is not going to go away (although it may be temporarily 'solved'). It may have begun in Greece, but it is spreading to Portugal and Spain. It is contagious and virulent and is unlikely to remain confined to just these small economies.
Seems Like Old Times: US rockets killed 12 civilians in one attack as the search for hearts and minds got started in Helmand province.
Orientation: Some folks – mostly those who make more money than most of us – admit that the US is unequal in terms of income, but claim that the US “is an extremely mobile society from year to year”. Yeah, downward of late.
Name That Tune: The US imports most of its manufactured goods, exports mainly raw materials. It is dependent on foreign loans, has a malfunctioning public health system, has immense disparities between the wealthy and the population at large. Just like most other Third World countries, except they are often kleptocracies.... oh, wait!
Breaking the Good China: A lot of money managers are (still) infatuated with China, pointing to a decade with an average GDP growth of 9%. But that was based on exports. Now the 10% growth is based on lending – a 27% increase in loan-to-GDP ratio. That's a lot of money. It could become a lot of inflation and it certainly is a lot of credit. We know what comes after “a lot of credit.”
Time Marches On: The 5.6 million Americans drawing “extended” unemployment benefits will start tumbling into the mist next month – up to a 5 million will be without any income by June.
Be Very Afraid: Soon the Fed will begin raising short-term interest rates and reducing outstanding bank reserves. But don;t worry, Mr Benanke says “we have the tools to reverse, at the appropriate time, the currently very high degree of monetary stimulus. We have full confidence that, when the time comes, we will be ready to do so." Full confidence, that's what the man is full of. Confidence.
Good News/Bad News: The good news is that you've still got a job. The bad news is that you are paying for all those who've already lost theirs. Or your children will.
Atlas, Shrugged: Rep. Paul Ryan, ranking Republican on the House Budget Committee, has put out a new “Roadmap for America's Future,” which proposes the everyone under 55 should not get Medicare when they retire, but would instead get vouchers with which to enrich private health insurers. But don't worry, Newt Gingrich is there to save the day: “Don’t cut Medicare. The reform bills passed by the House and Senate cut Medicare by approximately $500 billion. This is wrong.” Newt Gingrich?
Whose Counting? The CBO says the US overall debt/GDP ratio will rise from 53% now to 77% by 2020. Moody's says the CBO is being modest and that by 2020 the ratio will be “well over 100%”. Which is well into the danger zone – just ask Greece, Italy, Portugal...
Things That Go Bump In The
Dark Port:: A bunch of aluminum from Africa and South America ended up in some ports in northwestern Japan. Suspicion is that it is Chinese aluminum that has been declared surplus to requirements and quietly dumped. In that Chinese buying has supported the commodities market for the last year, this may be a bad sign for the market. See your doctor if symptoms persist.
Tailoring: Asked about the Bush administration's claim that torture was 'legal' – despite both US and international law to the contrary - Cheney said that the Justice Department arrived at the legal opinions their masters desired.
Mea Culpa: We'd like to blame Wall Street. Or the Government. But today's economic problems stem from our demand that we be pandered to, that we deserve more, that we are entitled, and that we should be able to get without saving, without even working. We wanted to believe in magic, but choices have consequences.