SAR #12153

These things are always complicated but some of it is about money.

Up, Up & Away? Spain has seen nearly €100bn in capital – 10% of the country's GDP – flee the country in the first three months of the year. Losses in the current quarter are expected to be even more dramatic.

Gut Reaction: Economists are puzzled when the great unwashed dislike inflation – don't they know that wages “are the biggest component of the price level”? No, they don't. People think that inflation lowers their real wages and steals their savings. Why would they think that? Well, because it does.

Eye On The Prize: Is the main goal of the current European kerfuffle the real integration of Europe, fiscally and politically? Keep in mind that the real integration of the American colonies didn't get started until the Civil War and has not yet been completed. Before Europe can pull itself together, it may be necessary for it to come quite seriously unglued. And soon.

Asundered: A federal appeals court in Boston found the US Defense of Marriage Act to be unconstitutional.

Bless You, My Child: Ireland's voters have decided the country should commit suicide and ratify the European Union's deficit-fighting treaty, which will make it easier for Germany to dictate Irish budgetary and tax policy until the country is completely destitute because the treaty does nothing to create jobs or to provide meaningful assistance to Ireland, Portugal, Greece and Spain (and Italy will soon join this list of countries in thrall to Bonn).

Never Satisfied: Last month, GM deliveries rose 11%, Chrysler’s climbed 30% and Nissan’s 21%. The results missed analysts’ estimates, so they were disappointed.

Blackmail: Berlusconi says that Italy should say “ciao, euro” if the ECB doesn’t start printing money to tackle the debt crisis. He also suggested that Germany should quit the euro if it won’t back a bolder role for ECB. He was echoing Prime Minister Monti's call for Merkel to drop her opposition to allowing the euro region’s rescue mechanism to lend directly to banks.

What's A Government For? In Montreal, after weeks of student demonstrations followed by the government's imposing a draconian law curtailing the public's right to assemble and present their grievances, the two sides sat down to negotiate. After four days of frustration, the talks broke down. Nightly protests continue, while the government seems truly befuddled, not realizing the mistake they made trying to criminalize democracy.

I Cannot Tell A Lie: The computer viruses attacking Iran were set loose by President Obama, it what must be considered an act of war. Apparently cyberwarefare does not need Congressional advise and consent.

Ups & Downs: The NY Fed reports that student loan debt grew $30 billion in 1Q2012, and now stands at $904 billion. Consumers overall continued to deleverage, reducing their indebtedness by $100 billion to only $11.44 trillion.

A Little Off The Top: JPMorgan has (already) cut its estimate for 3Q2012 GDP growth from 3.0% to 2.0%. And that was before the jobs data fell off the table.

Daily Doomster: Raoul Pal, former co-manager of hedge funds sales for Goldman Sachs, co-manager of GLG Global Macro Fund, sees a major European bank failure within six months, followed by the collapse of the European banking system and the essential bankruptcy of most continental governments. Then the UK joins the collapse, followed by Japan, then China, and ultimately the US. That will be the end of the fractional reserve banking system and of fiat money. There is about six months left, he claims, before the strings come untied. Remember to wear your beanie.

Jailhouses Rock: The United States incarcerates more of its citizens (an a higher percentage of them) than any other country. Any. Other. Country. US = 730 per 100,000. Russia, 513. Ukraine, 339. Iran, 333. South Africa, 310. Everyone else, far fewer.

Porn O'Graph: Mary, Mary, How's the garden?

The Parting Shot.

Queen Ann's Lace.