SAR #11012

The Guantánamo Bay torture center turned 10 yesterday. Happy Birthday.

To The Point:  Bob Woodward became one of the richest and most prominent journalists in Washington by exposing the secrets of government and publishing classified documents in book after book.  And while politicians often found him inconvenient, his fellow journalists simply envied him and tried harder to ferret out the hidden truths.  Yet Woodward was never labeled a terrorist and hauled off for re-education.

Nest Egg:  William M. Daley, the next Obama chief of staff, holds 175,678 shares worth $7.6 million in JPMorgan Chase, where he is vice chairman.

Debt Rattle:  Portugal has rejected the demand from Germany and France that it leap into the embrace of the EU/IMF 'rescue' process, claiming it does not need assistance and is well on the way to getting its problems under control.  Portugal's finance minister suggested that Germany's concern was not for Portugal, but for itself and it's own bankers.  There are reports that “technical talks” between Portugal and the EU/IMF are already underway.  If this reminds you of the final days in Ireland, there's a reason.

It Is and It Isn't:  The Bernank's quantitative easing is adding about 10 cents a gallon a month to the price of gasoline and driving up the price of food, too.  But it isn't inflationary because The Bernank doesn't count energy and food in calculating inflation.  Calculating is the right word.

Compromise:  “We should try to create the society each of us would want if we didn’t know in advance who we’d be.”

Over There/Here:  "Japanese workers´ willingness to accept wage cuts to safeguard their jobs is lowering prices and deepening deflation."  In the US, over half the unemployed who have found new jobs took a cut in pay, most taking at least a 20% cut in wages.

Knee Jerks:  The sale of automatic handguns like the Glock used by Lougner have surged as concerned individuals rush to stock up before additional restrictions – like a sanity exam - are placed on weapons capable of instantaneous mass murder.  Some Arizona lawmakers argue that the shootings are a good reason to expand the carrying of concealed weapons.

Interpretation:  The Ivory Coast says it is taking  'all necessary measures'  to avoid defaulting on $2.3 billion in bonds.  They've crossed their fingers.

Noted:  For the past decade the US has worked to establish a climate of fear.  It has abducted people and disappeared them into secret prisons; shipped them to its “less squeamish allies” to be tortured; thrown them in cages without charges; spied on its own citizens without warrants and arrested them without charges; all with one overarching objective: to create a climate of fear.   It worked.

Depressing:   We've now had 4 1/2 years of declining house prices, with a 5.07% drop y/y in November.  House values have now fallen 26% since the June 2006 peak.  This is more than the 25.9% drop during the Great Depression.  And the slide is not over.

Misdirection:  Newt Gingrich is pushing for federal legislation giving states “the right to file bankruptcy and renege on pension and other benefit promises made to state employees.”   But such a law would be unconstitutional, so one must assume the intent is to paint workers' pensions and union contracts as responsible for the devastation Wall Street has caused.

Anomaly:  For those who reject the idea that the markets are rigged, look at the surge in S&P 500 Futures 4 seconds before the bullish ADP data was released last week.  Lucky guess, right?

Better Late... International bank regulators have agreed to raise worldwide capital requirements whenever an individual country declares a credit bubble.  Given countries records at spotting credit bubbles and their disinclination to mention even an obvious one, this agreement means that once the horses are gone, they'll all yell  “Barn Door! Barn Door!”

Porn O'Graph:  Change in number of workers, or not.