SAR 9178/Weekender

Things that can't get better, get worse.

California Here We Come: Nearly half the states do not yet have budgets for 2010, and they are due July 1st. Absent a lot of last minute bi-partisanship, state employees may not be paid and many services suspended. But the spirit of bi-partisanship lives, no?

Second Verse: The Obama administration has drafted an executive order reasserting the President's right to clap anyone into irons and keep them incommunicado indefinitely. Why do we bother with elections?

New Business: AIG is going to give the taxpayers $25 billion in stock in insurance companies operating overseas. Maybe Tiny Tim and Uncle Ben can write insurance on the people who now own America's factories...

The Point: We keep being reassured that A has x billion barrels of oil reserves, B nearly that much and so on. Tens perhaps, hundreds of years of petroleum in reserve - proven, probable and possible. But in the post-peak era, the real question is how much of the oil will be exported? And regardless of the size of the energy reserves - be it oil, gas, or coal - the real question is how quickly they can be produced, at what price? Oil locked away in tar sands is a "reserve". It's not energy until it is mined, processed, refined and hauled to some user.

Without Comment: "Church to celebrate carrying of guns."

Eating the Seed Corn: Ultimately, recessions don’t end without rising employment, meaning consumers with money to spend. If the credit card companies keep raising rates, any gains in income resulting from the Obama stimulus will be swallowed by more usurious gouging of the indebted.

Paper or Plastic? Credit card companies are charging off over 10% of their balances as increasing numbers of Americans cannot make their payments. The country charges much of what it buys - think about 10% of that not being paid for. Plastic coated shoplifting.

Holding It's Breath: If the US passes carbon legislation, Big Oil will close refineries, cut capital spending in the US, import more gasoline, and hold it's breath until it gets its way.

Lost, Strayed, or Stolen: We're all aware that our pensions have disappeared, that our wealth has been vaporized, that the US manufacturing giant has been shrunk. But did you know that in the decade since 1999 jobs in the US have only increased by 1.1%? No wonder your kid is still living with you.

Everyone's a Winner: Great Britain has the biggest deficit (by %). Ireland has the most severe recession. Iceland was the first to disappear. Goldman Sacks placed the most alumnae in government offices..

Hummer Dinger: Chinese regulators are likely to block the sale of Hummer to a Chinese company because it doesn't fit in with its new svelte, lower-emission look.

Good News: US house prices will never actually reach zero although it will seem that way as prices keep falling through this year and next and probably into 2012. Without the $8,000 to $15,000 taxpayer gift, and the taxpayer supported FHA, FHLB, Fannie and Freddie, there would be no house sales at all. The only thing holding up any housing market (and thus the banking system) is the continuing generosity of you, my friends and neighbors.

Persistence: Apparently unsatisfied with the lack of action at the recent BRIC meeting, China's central bank again suggested an expanded version of the IMF's Special Drawing Rights replace the dollar as the international currency.

Painful Profits: As we long suspected, health insurers regularly "dump the sick" to improve profits. Insures habitually force consumers to pay for covered bills - often by "fudging" the numbers. Single payer universal coverage would cure this abomination.

Exhaustion: About 300,000 unemployed people run out of their 26 weeks of UI and are dropped from the BLS unemployment statistics. That's a million a month. While some eventually find jobs, they make up a large uncounted section of the unemployed - as many as 3 or 4 million.

Porn O'Graph: Freddie's little delinquents.