We've seen this movie before.
Peace In Our Time: The US market is all excited, thinking the weekend's action was progress. The plan calls for Greece (and Spain and Portugal) to cut costs and prices – but this means lower wages and lower employment and lower GDP and higher taxes. All of which means deflation. Does anybody believe the Greeks and their Iberian cousins are going to suffer years and years of grinding poverty just to keep German and French bankers happy? But as long as someone kicked the can down the road a month or three, everything's great. Can you say “downward spiral”?
Game, Set & Match: Goldman Sachs made money on every single trading day of the first quarter And on 31 of the 63 days it made over $100 million. How'd you do?
Letter Home: In its quarterly letter to the family, Fannie Mae admitted she lost $11.5 billion in the first quarter – which was better than the $15.2 billion frittered away in the last quarter of 2009. Along the way Fannie picked up 61,929 more houses through foreclosure and sold off most of them at a loss. While business is brisk, no profits are seen for the “indefinite future", so she'd like a $8.4 billion advance on her allowance, now, before the bankruptcy sets in and the whole $7 trillion gets frittered away.
Keeping Score: Food stamps are reaching only 40 million of the 60 million Americans eligible to receive them – 1 in 5.
Identity Crisis: Wall Street used to pretend its raison d'être was to provide a place for business to raise capital for its undertakings. But today less than 1% of trades return any money to the issuing company. Once they've issued the shares, all of the stock trading has nothing at all to do with the company and everything to do with gambling. And the game is rigged.
Resumé: Used to be employees were rewarded for their loyalty and performance and productivity with things called raises and promotions. Today the reward, if there is any, is to let workers work harder and longer for less pay. Having cut all of the jobs they could, companies are now generating profits by cutting the salaries of those who remain. Or better yet, hiring back the fired at half pay with no benefits – now that's management!
Time Saver: The headline read “Exchanges agree in principle to new rules.” Knowing that the exchanges have no principles, I didn't read the article.
The Biggest Investment of Your Life: More than 20% of US mortgage holders should walk away – their homes are worth less than they owe. 6.67% of mortgage holders are at least 2 months behind on their payments. Nationwide 1 out of every 1000 houses was repossessed in March, as house prices fell another 3.8% in the first quarter and one out of three houses sold for less than its owner had paid for it. Bank repossessions rose 35% from a year earlier.
Page 2: While the traders and the markets are spilling stuff racing to get in on the new bullish trend, the OECD announced that its composite leading indicators “point to a slowdown in the pace of economic activity." Party poopers.
Pacified: A series of attacks killed over 100 people across the Iraq so successfully pacified by General David “I'm-Not-Running-For-President” Petraus. The government blamed al-Qaida in Iraq for violence in Baghdad, “despite security gains by Iraqi and U.S. forces over past years.”
Distance: A US District Judge has ruled that being tortured doesn't mean that what's left of you cannot be tried. Brings new force to habeas corpus .
Porn O'Graph: Check's in the mail.