Tuesday, March 13, 2012

SAR #12073

SAR 12073

Did you immediately think of My Lai, too?

Fool Me Once... The IMF will contribute only 18 billion euros to the second Greek bailout fund. At 14%, this is a sharp reduction from the 27% it put towards the first bailout. It explained that it was “trying to manage a difficult balance between staying involved in the rescue package for Greece while limiting the risk to its own funds.”

Enigma: Bernanke & Company claim they keep giving cheap money to the banks so they could loan it to businesses to expand the recovery. Yet the Fed continues to pay 0.25% interest on the excess reserves the banks keep with the Fed - about $1.6 trillion. In short, the Fed is loaning money to the banks at close to zero interest and paying them 0.25% to not lend it out. This does two things: It acts as a government gift to the banks, and it keeps the money created by the Fed to keep the government running etc, from circulating in the economy and accelerating inflation.

Seeking Clarity: Surveys show that among women, Democrats lead Republics by 25 points. This speaks well of the ladies.

School Solution: Big money Texan Kyle Bass expects bad things to happen, so bad that while he was on the UT board he had the university take physical delivery of $1 billion in gold bullion. He's also buying up nickels because he expects the metal in them to soon be worth more than 5 cents apiece.

Anschluss: The first of the lawsuits seeking return of the money investors lost when Greece defaulted has been filed. There will be more. Things are looking up for the lawyers.

Except: The US net imports of crude oil fell 10% last year - a drop of 1 mbd - and now we import only 45% of our petroleum, down from 2008's 58%. The modest 120,000 barrel a day increase in domestic production y/y did not have much impact. The slowing economy was a far more important factor. It's just as well, the developing economies - think China and India - are outbidding the developed nations for oil, and have been since 2005. It is no longer all about us.

One Thing And Another: About half of Republicans in Alabama and Mississippi are convinced that President Obama is a Muslim, global warming is a hoax, evolution doesn't happen and so on.

No Need: Sanctimonious Santorum says that politicians should not use teleprompters, which probably works well for those with Bible-based, fact-free policies.

Whether Report: The bond swap that just docked private sector investors with 72% losses is not going to cure the problem of Greece's failing economy. Thanks to relentless austerity measures, Greece's GDP has shrunk about 20% since 2008, 25% of businesses in Athens and the Attica region have closed, the tourism industry (which was supposed to be the backbone of the recovery) is nose-diving. The standard of living is collapsing, to the point where half of the most common pharmaceuticals, including antibiotics, are no longer available. There will be a further default, and Greece will leave the euro, at a date uncertain, but not far distant.

D Minus: February, usually the worst month for the Federal deficit because of tax refunds, set a record at $231.7 billion - the largest monthly shortfall on record – which may suggest something about the strength of the recovery.

Contagion: Canadian environmental groups say their government has created an atmosphere of fear and suspicion designed to silence dissent. Like you-know-who,next door.

Porn O'Graph: Running swiftly to stay in place.


rjs said...

Did you immediately think of My Lai, too?

yep. mentioned it in my first correspondence

Anonymous said...

School Solution: Big money Texan Kyle Bass....

Mr. Bass may have a problem disposing of his hoarded nickels. According to this 2006 story, it is ILLEGAL "...to melt pennies and nickels. It is also illegal to export the coins for melting. Travelers may legally carry up to $5 in 1- and 5-cent coins out of the USA or ship $100 of the coins abroad "for legitimate coinage and numismatic purposes.""


So Mr. Bass, how do you intend to tap into the non-currency value of your hoarded nickels?
Someone from the Treasury should visit Mr. Bass and examine his hoard of coinage, which, as the story above explains is a cost, as usual, to the long suffering 99% taxpayer:

""The nation needs its coinage for commerce," U.S. Mint director Ed Moy said in a statement. "We don't want to see our pennies and nickels melted down so a few individuals can take advantage of the American taxpayer. Replacing these coins would be an enormous cost to taxpayers.""

One question to Mr. Bass might be: "Did you get all this coinage through the (bailed out) Banks? If not, where did you get it?" I can imagine the reaction at any bank if Joe Doughnuts offered to buy, say, $50,000 of nickels. Did I hear Homeland Security? But, if your pals run the banks ....

All this seems to illustrate that the 1% are not napping and that the normal rules do not apply to THEM. Hopefully, the more inquisitive and investigative in the contrarian blogging community will see that this story may have legs. For starters, it seems to illustrate that looting the System can take many different forms.