SAR #10335

This too shall pass, faster than you might imagine.

Superficial:  Taking his cue from the failed and failing in Europe – and their IMF/Bankster masters, not to mention the GOP and Goldman Sacs - President Obama, in a transparently cynical gesture, proposed a two-year freeze of the salaries of all civilian federal workers – about 2 million workers.  The proposal, which must be approved by Congress, will save the equivalent of a handful of drone attacks on weddings in Pakistan, take the US another step further in the global 'race to the bottom' in wages by setting a standard Big Business will eagerly match, and save $7 billion over two years.  That's all of 0.1% of federal spending.  By the way, how are Great Britain, Greece, Ireland, Portugal etc. doing with that austerity thing?

If/Then:   If an increase in oil consumption indicates an increase in economic activity, then we're in luck.  In September, US oil demand was up nearly 5% y/y.

Place Your Bets:  After the next warm-up bout between the politicians and the bankers – in Portugal – the main match will play out in Spain. My money's on the bankers.

Motive, Means, Opportunity:  A bomb in Tehran killed one Iranian nuclear scientist and wounded another.  Hmm.  Qui bono?

Spot Spotted:  A sizable portion of the 4 million barrels of BP's oil that went astray last summer has ended up in globs on the ocean floor – not harmlessly dispersed as the upbeat would have you believe.

Heresy:  David Stockman, Reagan's budget director, says that the two pillars of current GOP theology – that tax cuts for the richest are necessary and that tax cuts will miraculously pay for themselves – are hokum.  He claimed that the latest Bush administration had destroyed “the last vestige of fiscal responsibility that we had in the Republican Party.”

Worst Case Worser:  Once upon a time, two years ago, there was hope that eventual climate warming might be limited to 2º C by 2100.   Now it is routinely accepted that a rise of 4º C (7.2º F) is inevitable by 2060.  A legacy for my grandaughters.

Quoted:  “My only fear in life, when it comes to money, is what’s happening in the United States of America.  The American dream is dead for the majority of America.  The middle class has disappeared.  We have a highway to poverty and no roads coming out.”  Suzi Orman, financial guru.

Porn O'Graph:  Building the bulge.

SAR #10334

Demographics, a science more dismal than economics.

Apocalypse Now:  By the time you put all the pieces together, you'll see that the latest terrorist attack in the US was instigated by the FBI, planned by the FBI, the bomb was designed by the FBI and the components delivered to the designated patsy by the FBI.   True, the accused seems to have wanted to do something, but he doesn't seem to have been allowed much free will in the matter.  Ah, I love the smell of entrapment in the morning.

Data Mine:  I went to the mall Friday, walked around, didn't even buy a cup of coffee.  Apparently I had lots of company, traffic was up 2.2% but sales were only up 0.3% , small enough to be a rounding error.

In the Pouch:  Why is anyone shocked to discover that US foreign policy is a combination of corruption, bribery, mendacity and double-  It is not news that Pakistan's ISI invented and operates the Taliban, that billions of dollars in 'aid' are immediately stolen when they get to Kabul – if they get that far, that thieves run Russia, or that the Saudi's would love to see Iran bombed to pieces.  That American foreign policy is run by a combination of right wingers and AIPAC is not earth shattering news.  The big news is how insecure State Department security is – even though they seem to have had NSA mount someone mounted a denial of service attack against WikiLeaks – to no avail.

More Wet Water:  “Upper-Class People Have Trouble Recognizing Others' Emotions.” They have even more trouble pretending they might care.

Cart/Horse:  In Ireland they plan on passing a budget that sells the Irish into four years of indebted servitude, then holding a referendum on whether they should have done so.  Heads the banks win, tails the people lose.  Modern democracy.

Bypass:  A pipeline to carry crude from Abu Dhabi's largest oilfields to Fujairah, bypassing the Strait of Hormuz, has been completed.   A small but important step in preparing the global petroleum delivery system for war with Iran.

Holiday Spirit:  As you go through this festive season remember that 43 million Americans are on food stamps – an increase of 15 million since 2007.   That's 14% of the population.  Food stamps today are what soup kitchens were in the 1930's.

Goody Two Shoes:  A lot of the alternative energy puff pieces imply that salvation is just around the corner, that we'll all have electric cars in a few years and the electricity they'll need will come from solar panels somewhere, somehow.  Not true.   The energy infrastructure is so complex and expensive that even as petroleum declines it will command the market.  There have been few signs that alternative energy will be ready to play any significant role for decades, which is too bad because there will be a pretty nasty gap before a resolution is found.

People, speaking:  Of 130 million potential voters, about 65% saw no reason to vote.  Hard to claim a mandate for anything.

Quotas:  The International Commission for the Conservation of Atlantic Tuna is continuing its fight to save the Atlantic bluefin by setting its 2011 tuna catch limit at 12,900 tons, down 600 tons from last year.  Of course tuna fisherman haven't been able to catch even that many because they've caught too many for decades.

Big Boys Don't Cry:  A man in Miami is being charged with “resisting arrest” for covering his head with his arms while two Miami police beat him unconscious while he lay on the street trying to commit suicide, passively.

Bombs, Not Bombers:  TSA should concentrate on stopping bombs, not bombers.  We need a device that will reliably sniff out sufficient quantities of explosive to bring down an airplane.  If someone wants to blow off their foot or castrate themselves while in the air, fine, it won't bring down the plane.  The body scan thing is solving the wrong problem, as does restricting liquids and x-raying shoes and asking if you packed your own suitcase.  The aim should be to detect high explosive in quantities that are sufficient to cause significant damage.  When explosives are found, take the person concealing them out to an open spot on the airport and detonate them – the explosive and the carrier.

His Master's Voice:  In a few well chosen words explain why Homeland Security is shutting down websites without a court order or other legal proceeding.  “Because they can” is not an acceptable submission.

Porn O'Graph:  Bargain Sale, lots of charts – see 2, 3, &4 !

SAR #10332

Fear is a commodity.

Simon Says:  Portugal's prime minister insists there is “no connection” between the Irish rescue and Portugal's situation because “Portugal doesn’t need anyone’s help.” Spain's finance minister agrees, claiming that Spain 'absolutely' does not need a bailout.  Is there an echo in here?

Pay to Play:  China says that if the world wants to keep receiving rare earth shipments, it had best shut up about the manipulation of the yuan and its long and ongoing history of violating international trade rules.   “We are happy to continue a sustainable supply,” they say, “As long as we get out way.”

Push/Shove:  Alaska's governor asks which is more important to you, polar bears or petroleum?  Me, I've seen a polar bear.

Proof/Pudding:  A plethora of plagiarized and out of context data in the Wegman Report, a much-touted denial of climate change championed by Representative Joe Barton, suggests there was less science and more politics than usual in the report.  Golly.

Dance Card:  China is funding a $6 billion petroleum refinery expansion in Cuba, while India is looking to buy five coal mines in the US, Australia and Indonesia, before the Chines do.  Ain't it nice to be wanted?

Endgame:  The culmination of the Deficit Committee and next spring's federal debt limit showdown may be the creation a crisis that 'the experts' say can only be cured by instituting a flat tax on income, along with a value added tax on spending, coupled with abolishing taxes on interest, dividends, capital gains and property.  It would be the ultimate victory of the uber-rich, whose mantra would become  “Your money and your life!”

Correlation/Causation?  It's been noted that, at least in California, increases in energy prices and increases in poverty levels occur in tandem.  Not really surprising in that our whole economy is based on energy consumption.  Energy prices are expected to continue to rise.

Power to the (Right) People:  Republicans are seeking to consolidate all energy and natural resource considerations into one congressional committee, provisionally to be called the Energy and Natural Resources Operations Nexus, or something like that.

Writing Prompt:   Over the next 15 years China is expected to build the equivalent of 10 New York Cities.   1,500 words please, usual prize (No trips!)

Priorities:  Rushing back to the past, Senate Republicans voted unanimously against a bill that would work to ensure fair pay for women.  Despite support by the majority, the Republican filibuster once again allowed the GOP to say No!

Serious People:  You might think that those who lent all that money to the failing Irish banks would take the losses, until you remember that they are bankers and bankers don't take losses.  People do.  In this case, the Irish people who, by 2014, will be paying about 20% of  their taxes directly to the bankers in interest – they'll never get the principal paid off. The serious people (who are the bankers and their IMF cronies) say this is necessary to restore confidence in the banking system that no matter what, they will not have to take losses. Just like in the United States.

Uprooted:  About half of all the people who are delinquent on their mortgages have given up on the putative American Dream and would rather rent than try to buy another house.

Infrastructure:  Increases in the cost of materials, especially asphalt, combined with plunging gasoline tax revenues will cut Michigan's 2012 road construction and maintenance budget in half.  Drive on the left.

Protect and Defend:  A Rasmussen poll found that 44% of Americans think the government operates in unconstitutional ways.

Cold Comfort:  Kjell Aleklett, the Swedish energy expert generally credited with coining the phrase 'peak oil', says not to worry about the global warming effects of burning fossil fuels.  There is not enough oil and coal and gas for us to burn to push the global temperature to 6º C.   Maybe 3 or 4º C, which is sufficient to cause a great deal of mischief, but then they'll be all gone, and with them modern industrialized society.   So don't worry, it'll get warm enough not to have to heat our homes about the time we run out of fossil fuels to heat our homes.

Nightstand:   Michael W. Hudson’s 'The Monster: How a Gang of Predatory Lenders and Wall Street Bankers Fleeced America–and Spawned a Global Crisis.'

Porn O'Graph:  The big letdown.

SAR #10331

One more time: you cannot borrow your way out of debt.

Giving, Thanks:   As estimates of the Irish bailout climb through €200 billion, the average Irish household will owe about £3,000 in extra taxes, while the bailout funds go to global banks in Germany, France, and eventually to Goldman Sachs.  The Irish get wage cuts, social service cuts, VAT increases, and unchanged corporate taxes.  Any questions?

Seconds?  There were 407,000 new unemployment claims this week, bringing the 4 week moving average to 436,000 – the lowest it's been since August 2008.  'Please, sir, I want some more.'

Sign Lanaguage:  A bill before the Australian Parliament would require government approval before a foreign interest can take control of farmland.  For 'foreign' read 'Chinese'.

Over the River and Through:  The average house in foreclosure is 492 days delinquent.   Over 20% of mortgage loans that are over two years delinquent are not yet in foreclosure.  Some 9.20% of all mortgages are delinquent and 3.92% more are already in the foreclosure process – that's 13.2% of all mortgaged homes (4 million) that are circling the drain. October's new house sales were down 8.1% m/m,  to an annualized 283,000.

Day Late, Dollar Short:  CNN wants to know if the US is on the path to permanent war.  On the path?

Tab A in Slot B:  Research shows that older workers who desperately need jobs and have a very difficult time finding them are more willing to work for peanuts than cocky youngsters who are still free-loading off mom and dad.  Imagine.

Way-Back Machine:  Major firms are arguing that they need a two-tier wage system to help bridge the recession.  What they really want is to permanently drive down wages by hiring cheap help and getting rid of older, better paid workers.  Big business is essentially trying to abolish unions, returning workers to their pre 1920 dependence on the largess of the boss.  There will be far more than just two tears.

Silly Question:  Is the stock market rigged?   Depends on how you define 'rigged'.

Anti-Reformation:  In an attempt to intimidate Elizabeth Warren as she sets up the Consumer Financial Protection Bureau, Republicans have sent the inspectors general at the Treasury and Federal Reserve letters suggesting they exert “rigorous” oversight on her activities.  The object, of course, is to prevent – as far as possible – the Consumer Agency from being effective, an example of the GOP using non-legislative pressure to prevent implementation of legislation they opposed.

Word/Wise:  A 5 year study suggests that at least 18% of patients are harmed by hospitals, and the the trend is not getting any better.

Winter of Discontent:  Much of the unhappiness with the Affordable Care Act is that it did not really reform health care – that's what 35% of the electorate say.  The 33% who want to repeal the act tend to be white men over 40 who make more than $50,000 annually. There was no data on what percentage of these men had walked off and left a wife and kids to fend for themselves.

Pull the Other One:  Bush still maintains there were legitimate reasons to invade Iraq, and that torturing people was necessary and legal.

Pelham 123:  Ms. Napolitano says that terrorists will keep trying, so ever stricter security standards will be necessary.  She said that screening passengers using trains and subways and buses and car pool lanes will be phased in so we can all feel safe.

IMF vs Children:  In case you haven't noticed, its the children that lose and the IMF's bankers that win.  Always.  Save the banks at the cost of the people.  Always.

Final Notice:  Americans have been taught to live on their credit cards, carrying huge balances for years.  Now elderly Americans are doing just that, running up credit card debt not just for for health care, but for vacations and ordinary expenses.  And they have no intention of paying of their debt.  If they planned ahead and got a reverse mortgage and run down all their assets, the credit card companies will really get stiffed.  Seems appropriate.

SAR #10328

The Hitchhikers Guide was wrong, it's not harmless.

Falling Leaves:   Existing house sales fell 2.2% m/m and 25.9% y/y in October.  The inventory of existing houses for sale was up 8.4% y/y.  The total months supply of unsold houses was 23 months in August - six months used to be the norm.

Consensus, Redefined:  The Ministry of Truth has decreed that the recent election was a referendum on debt and that Washington received a mandate from the people to cut Social Security, gut Medicaid and Medicare, reform the tax code so the middle class and poor pay more and the rich pay less, abolish health care, and to stop pandering to the long term unemployed.  Isn't that what your vote meant? Apparently 'consensus' still means “made up by the Republicans”.

All You Need To Know:  From the horse's mouth: “Greed Beats Fear in US...”  Common sense ran last.

Cry havoc …  When the government wants to extend its grip on the population it applies the always successful 'be afraid, be afraid' card.  No evidence is required, just the repeating the mantra “terrorists, terrorists”.  As my mother used to say, it's for your own good.

Perception:  The markets don’t seem impressed by the Irish bailout.

Plan B:  Relentless budget shortfalls are prompting states to consider dropping out of Medicaid.  Not that any state is actually considering total abandonment of the program, but a series of severe 'what if's' are being examined.  The most popular is rejecting federal funds (57% of the cost) so the state can dramatically redefine eligibility and coverage – starting with nursing home payments.

Cousins:  Researchers now report that fish shrink during cold weather.  I know the feeling.

Pin the Tail on the Donkey:  The BEA's second guess at 3Q2010 GDP was raised from 2.0 to 2.5% growth, with the increase stemming mostly from an increase in state and local government expenditures, net exports, and personal consumption.  Non-residential structural investment dropped from a 3.9% increase to a 5.7% decrease.

Free Enterprise:  An impostor posing as a top Taliban commander held secret talks with Afghan and NATO officials, was paid a lot of money and then disappeared.  One bag, or two?

Then We Went to War:  Our casualties and loss of troops and expenditures of wealth in Afghanistan do not contribute to our national security.  Remember that just before we invaded Iraq we declared victory in Afghanistan?  Why are the neoconservarives who told these fabulous lies still in control in Washington?  The “war on terror” is now in its tenth year.  When will it end? Never?  What is it really all about? Is the “war on terror” designed to create enough fear in the US to allow continued expansion of the police state?

Chasing Cars:   Animal rights activists are seeking good homes for a thousand rats.  See, it's the old problem of what do you do once you've caught the car.

Windsock:  To gauge the general nature and direction of the Simpson-Bowles Fiscal Commission's proposals, note that its proposals would lead to an average $7000/year tax cut for the top 1% of America’s richest and about a $600/year tax increase for the working and middle classes. See the chart.

Clarification: The headline, “FBI Widens Insider Trading Probe”, has nothing to do with air travel.

Dog Days:  Here's some filler on a slow news day: TV personality, wilderness guide, author, taxation guru and would-be governor vice-president president politician Sarah Palin has lobbied ABC's "Dancing With The Stars" on behalf of perennial Senate candidate, witch, evolutionary expert and sometime sex adviser Christine O'Donnell.  Palin pointed out that Bristol's success shows that neither talent nor ability is required – much like Tea Party politics.

Unclear on the Concept:  A defrocked Catholic priest has been arrested for hiring a hit-man to kill a teenager he is accused of abusing.

SAR #10327

When you see “credit” think “debt”.

Human Nature 101:  Just as the American public wants Washington to cut the deficit and balance the budget without new taxes and without cutting Social Security, Medicare, Defense spending or much else, they want to be safe when they fly.  Safe, but not inconvenienced.  Search the other guy.

Present, Tense:  Neither the Republicans nor the Democrats have any interest in actually governing, and the Tea Party folks haven't a clue as to how it might be done.  All of which is just as well because at this juncture it may be a lost cause.  With every passing day, America is coming more ungovernable .

Ponder This:  Portugal's biggest creditor is Spain.

Speaking Up:  "Today the Irish Government sold its citizens into debt slavery by agreeing to guarantee stupid loans made by German, British, and US banks.  Those loans fueled one of the biggest property bubbles in the world.”  (This is exactly what happened in the US, too, with taxpayers footing an enormous bill for Fannie Mae, Freddie Mac, the TBTF banks and AIG.)  German Chancellor Angela Merkel has said that the banks and bondholders should pay for the bailouts, which were caused by their bad investments and general greed.  I'm with Angie, who may be getting her way.

Lot 49:  Barron’s reports that the banks that palmed off over $2 trillion in MBS bonds may have to pay as much as $134 billion in 'put-backs'.  Others think $134 billion is just the opening bid.

Bureaucracy:  All new cars sold in the US must have an EPA fuel economy label.  But the EPA hasn't yet figured out how to determine 'fuel economy' for all-electric cars.  So GM dealers can't sell the Chevy Volt because...

Quoted:  “...our nation is in much worse shape, much closer to a political breakdown, than most people realize.”   The real tragedy is the number of people in Washington who are looking forward to it.

Bookmark This One:  The Best of The Oil Drum 2005-2010

Burp:  After months in the doldrums, declining 3 to 4% each month, commercial property prices rebounded a bit, rising 4.3$ y/y in September.  A few high-ticket sales drove up the indexes.  Apartment buildings have led the pack, rising nearly 16% in Q3 from the previous year.  Retail properties have fallen about 12% in the same period.  People who lose their houses become renters, not customers.

Difference:  How does a rescue by the IMF differ from a rescue by the EMS?  The EMS are there to help people.

Operation Iraqi Freedom:  The Iraqi government has run out of money to fund widows' benefits, pay for farm crops and other programs for the poor.  It can barely pay the elected lawmakers their $180,000 each and keep the bribes flowing.  George Bush always claimed we were going to bring democracy to Iraq, and we have.  American democracy, where the rich get to stand at the head of the line.

Revisionism:  After spending several decades as an essential nutrient required for good health, chromium has been retired after studies showed it had no nutritional value whatsoever.

Cohorts and Contemporaries:  Unemployment for 20 – 24 year olds is 15.2%. In the US today only half of those with BA degrees are working in jobs that require a 4 year degree. The banks require they keep paying on their student loans, so that brings a little certainty to their lives.

Mr. Potato Head:  The US launched an enormous 'secret' satellite Sunday.  Analysts suspect that it is another giant electronic ear sending everything it can scoop up back to NSA.

SAR #10326

The light at the end of the tunnel is moving away. Michael Panzner.

Honesty:  As the mini-series continues, with Iceland, Greece and now Ireland brought to their knees in the drive to keep European banks and financial giants solvent, all attention will turn to slaughtering the peasants in Portugal.  In celebrating its Irish victory, IMF chief Strauss-Kahn demanded that European nations cede even more of their sovereignty to Brussels, for the time has come for centralized control and reform of European labor markets.  Yet support in EU countries for continued EU membership is close to the lowest levels ever.  It is becoming clear that the euro experiment will end in inevitable collapse. Facing this failure, expect European political and financial leaders to concentrate on promoting the interests of multinational corporations.

The Quote:  “The disconnect between the American body politic and reality grows larger every day.”

Truth in Packaging:  Mexico's National Hydrocarbons Commission has told Pemex to either produce more evidence supporting their claimed 17 billion barrel in reserves in the northern region, or to lower it by 50%, reducing the country’s total claimed reserves by 17%.  Wonder how they feel about a road trip to Saudi Arabia?

Sauce/Goose/Gander:  China has unveiled 25 new models of unmanned aerial vehicles, offering them for sale to the international market.  Previously the US and Israel were  the world leaders in killing civilians silently from pilotless drones.  Maybe we can sell some of ours to India.

Definition:  An optimist is someone who expects anything to come out of the global meeting on climate change being held in Cancún next week.

Use the Library:  Insurance companies are now going to data-gathering companies to find out what you've been Googling.  Done a search on breast cancer? Uninsurable.  Looked up info on that disease your neighbor died of?  Uninsurable.  Next time you want to look up some medical condition, visit your local library, use their computers. And an alias.

Are We That Dumb?  Could Palin become president in 2012?  You Betcha.

Privatization:  The financial services industry is applying the full court press to get Congress to remove property records from county courthouses paper records to digital blips on a privately owned for-profit computer system with no paper trail. And to make it retroactively effective back to about 2005.  What could go wrong?

Take Two, They're Small: A rare pink diamond went for $46 million, because “the demand for rare gems as a portable form of wealth” has pushed up prices.  In portable form.

Tyranny.  Senator Mitch McConnell has pledged to bring a Senate vote on “full repeal” of the health care bill, calling the bill's provisions requiring individuals to purchase health insurance a 'path to tyranny'.   McConnell should be careful – the GOP does not control the Senate and thus does not set its priorities, and the health insurers are pretty damned happy with the individual mandate because it delivers tens of millions of new customers to them.

I've Got Mine: Billionaire Warren Buffett, now that he's richer than everyone but god and Bill Gates, thinks that the rich should pay more in taxes and the lower and middle classes pay less.

Impervious:  We think we are entitled to our current way of life, that we can live on buried sunlight forever.  We pretend that change will leave us untouched, that our complexly interconnected delicately balanced economy is invulnerable, that we can keep borrowing from our future forever. Even those who think the whole thing is going to collapse somehow believe they themselves will be magically spared.

Good Question:  Who will get the naming rights to the Treasury, AIG or Goldman Sachs?

Calculus:  US states, led by California, are moving ever closer to bankruptcy, borrowing ever more with no plausible way to ever get out of the hole.  Eventually the US will bail them out, with strings attached.  But the US is doing the same, with the same endless hole gaping far into the future.  Internationally 15 leading nations will have to borrow more than $10 trillion next year.  That's twice the entire world's annual savings.  Anybody got a happy ending?

Smarter Grid:  Some long-term good may come from the use of Smart Meters, but their initial value is to let utilities charge you more for using electricity when it is convenient.  Oh, and they get to charge you for installing the meter.

SAR #10324

Economics trumps reality, but only for a while.

Playing Hangman:  The most astounding part of this long, slow charade is that the rescues of the banks and bond holders keep being described as sovereign bailouts. Nonsense.  No one cares if Ireland or Greece or Portugal fail as countries and their people suffer grinding poverty for decades.  The object of the exercise is to keep the European financial system going, just a little bit longer.  Certainly they don't expect us to believe that forcing Ireland ever deeper in debt is going to attract new investors – as Roubini says, ain't no-one coming from Mars to bail them out.  It's just another set of bank bailouts on the sly.

For Whom The Bell Tolls:  To mark the 18^th month since the end of the recession, NYC is laying off 6,201 city employees and leaving another 4,165 jobs unfilled.  That's 10,000, do I hear 12?

Progress:  The war in Afghanistan is going so well that the Army, for the first time, now feels it is safe to bring in heavily armored Abrams main battle tanks.

Show me Your Business Plan:  An outfit down in Houston called NRG Energy plans on building a $10 million network of electric vehicle charging stations throughout the city next year.  I hope someone told them that Grab & Run makes its money off soda and beer.

Unrenewable Energy:  After years of rapid growth through government cash, the renewable energy industry faces a grim reality: without the cash flow from Washington few if any alternative energy projects can attract enough investors to go forward.  So we'll go backward.

Sharecroppers:  Remember the old days when the landlord advanced the money and had first dibs on the harvest?  And the harvest was never quiet enough to clear the debt.  And so the farmer got poorer and poorer, until he had nothing.  Substitute Citibank as the landlord and your own name as the tenant farmer/sharecropper.  There are two things the banks fear – that you will not pay your monthly installments on your debt promptly, or that somehow, against all odds, you manage to pay it off.

Warm-up Question:  What's more important to the GOP? World peace or making Obama look weak?

Sliding Scale:  On Dmitri Orlov's 5 step scale for the collapse of society, the economy, and pretty much life as you know it,  Stage 1, the financial collapse is well underway.  2, the commercial collapse is just getting started as is  3, the loss of credibility of the political system. What remains are the two end states -  4, social collapse and  5, the fulll meltdown of cultural collapse.  Maybe Obama can appoint a commission.

Another Dumb Question:  'Is the US the largest systemic threat to global stability?'  Of course, haven't you been paying attention?

For Sale:  Toyota is going to pretend to be green in 2012 when it starts offering an environmentally friendly (if you don't count the coal burned to make the electricity) plug-in hybrid.  They hope to sell 50,000 of them at $36,000 each. It's either that or a $6,700 six year old Ford F-150.

Whistling in the Wind:  Ambac claims the banks that put together the poorly performing mortgage backed bonds that bankrupted the company should pay for Ambac's poor judgment in insuring them.

Previews:  An 'industrial action' planned for November 24^th will be the largest coordinated strike in Portuguese history as the workers protest a 10.7% unemployment rate with 600,000 unemployed.   Finance Minister, Teixeira dos Santos said that fiscal consolidation will be “harsh and demanding” with wage cuts of 10%, but it must be done or “the nation’s situation will be much worse than people imagine”.  Meanwhile the Catholic run charity Cáritas Portuguesa reports that the number of people seeking assistance has grown from 5,000 to 62,000 in a year.  The National Food Bank is currently sustaining some 280,000 Portuguese.  Cáritas Portuguesa has warned that “the blackest phase of the crisis has not yet occurred” as unemployment will continue to rise and become a long-term issue.

Politics, Explained:  Congressmen are getting richer, you are not.

SAR #10323

Feeling richer does not actually make you richer.

Get a Job, Yada Yada:  Republicans in the House are blocking renewal of unemployment benefits in order to get an extension of the Bush tax cuts for the wealthy and force those freeloaders getting $310 a week to see the light and go beg for a job at the Grab and Run.  Oh, right.  They're not hiring.

Weekly Lotto Numbers:  Initial unemployment claims = 439,000, a slight increase from last week and nowhere near being good.  The unemployment rate remained at 9.6 percent, while 151,000 new jobs were added to the economy last month.  In that the economy needs about 120,000 new jobs each month to keep up with population growth, not much headway is being made.

The Unexamined Life:  The world-wide bailout-based economy continues as stock markets rally, commodities rebound and bondholders smile in anticipation of the EU/IMF rescue of Irish Banks and their European bondholders.  Who's going to pay for all this?  Who cares?

The Grand Tour:  Does the grand European experiment with the euro and the European Community end with a slow motion bank run in Ireland?  Let us hope not if only because such an outcome would be unimaginably disastrous.  The cost to the Europe for propping up Ireland, Portugal, Greece, and Spain is miniscule compared to the costs of dissolving the EU.

Amateur Hour:  Ben Bernanke, trying out a new routine for his stand-up comedy act, now claims that the $600 billion QEII purchases of Treasury Bonds from private banks will create a million jobs.

Through the Mirror:  Nobel Peace Prize winner Barack Obama has awarded the Presidential Medal of Freedom to Warren Buffett for his lifetime achievement of amassing more money than it would take to rebuild Haiti.

Asked and Answered:  Will the examination of the Mortgage Electronic Registration System (MERS) be a whitewash?  Yes, of course.

American Family Values:  Reacting to Sergeant Salvatore Giunta's receipt of the Medal of Honor for saving the lives of American soldiers, Bryan Fischer, director of the American Family Association, claimed “We have feminized the Medal of Honor.  So the question is: when are we going to start awarding the Medal of Honor once again for soldiers who kill people and break things so our families can sleep safely at night?” 

X-Rays and Pat Downs:  Far more public anger has been elicited by the TSA pat downs that was ever expressed over US torture of Muslims.  Depends on whose privates are being pummeled.

Heavy Lifting:  Despite all their noise, do not expect the GOP to vote for deficit reduction. The name of the game is to dodge the blame.  No matter that the GOP beats the drum for austerity, the object is to get the Democrats to pass the measure.  Cutting popular programs and raising taxes – no matter how necessary - will never be greeted with cheers by the voters.

Sideshow:  Portugal's chief spy resigned after the government's austerity budget cut 7 of the Defense Strategic Intelligence Service's 11 foreign offices.  If the US cut the CIA’s budget by 60% would the world be better off?

Pipe Dreams:  Folks are jumping on IEA's admission that peak oil was reached in 2006 as an excuse to spread a lot of misinformation about how turning tar sands into oil will save the day.  Nonsense.  They claim that Canadian oil sands provide North America with more oil than Saudi Arabia.  True, but in 2008 Saudi Arabia produced about 8.5 mbd and Alberta only about 1.3 mbd. It’s the world market that counts. In the US, the Bakken formation's production grew from 100 kbd to 300kbd in only ten years!  That's about how much oil drips onto the parking lot at Cowboy Stadium on any given Sunday. Some claim Alberta has 180 billion barrels of oil hidden in their tar sands.  Maybe so, but that's only a six year supply for the world and they can't get it out that fast.  The hope is to produce 5 mbd from tar sands by 2030 – that'll meet about 5% of the world’s demand.  Sorry about running on, but I get pretty tired of being told that shale oil and tar sands are going to save industrialized civilization.  They are not.  As far as I can tell, nothing is.

Nightstand:  Wendell Potter's 'Deadly Spin' explains in detail how health insurers spend a large part of the public's premiums on profits, propaganda and politicians.

Porn O'Graph: Why is the market going higher as more people cash out of stocks?

SAR #10322

“The real issue is: Will the euro stand under the current circumstances in Ireland?   That's what the Irish government really has to focus attention on." Christine Legare, Fench Finance Minister

Program Note: The best mini-series of the season – When Irish Eyes Are Crying – continues to enthrall viewers from around the world.  Will the government drink the Kool Aid?   Will the Irish bend once more to the yoke of foreign masters? Can the Irish peasantry support both the government (with a deficit equal to 32% of GDP) and the banks and the euro?   Will banks in England, the EU and the USA share in the pain?   Will the EU/IMF demand control of Ireland's economy as the price of rescue? Is this a 'survival crisis' for the euro and the eurozone?   Is Frau Merkel right, is everything at stake?   “If the euro fails, then Europe will fail. And with it fails the idea of European values and unity."  Something will give, if not here and now, then Portugal in a few months and Spain after that.  Dominoes.

Promises, Promises:  Customers polled by Gallup say they are going to spend about 12% more this year than last.  It's in the cards.  Credit cards.

Tag Sales:  Various indexes reporting on house price trends month to month, quarter to quarter, year to year, all show declines from 1.8% to 2.8%.  The take-away number is that house prices are now off 29.2% from the peak and still falling.  Housing starts are down 11.7% month to month.

The Long and Winding Road:  What's the bigger challenge, breaking our addiction to cheap energy or breaking our addiction to government spending?  If the solution to our problems involves personal sacrifice for the greater good, there is no solution.  Not for energy shortages, not for climate change, not for budget deficits.  But the game will not end in a tie – something will come along to resolve these problems. Something.

Asked and Answered:  Will trade wars bring back American jobs?  No.

Lying Eyes:  The Bureau of Labor Statistics (the same folks who bring you the highly doctored unemployment figures) report that consumer price inflation is at its lowest level in 50 years.  That is, if you don't count food and energy.  I'm in great shape too,  if you don't count the extra 40 pounds and my complete lack of muscle tone.

Clear & Present Danger:  The Republicans say they would be more inclined to sign international treaties if it didn't involve agreeing with foreigners.

Guess Who's Not Coming to Dinner:  In the spirit of bipartisanship, President Obama invited the Congressional leadership to the White House for dinner and some discussion of the problems facing the country.  The Party of No declined, said they had more important things to do, but were open to a compromise if the President would check with them before sending out invitations.

Theme Song:  “We’re in a survival crisis.  We all have to work together in order to survive with the euro zone, because if we don’t survive with the euro zone we will not survive with the European Union.”  EU President Van Rompuy. Eurozone finance ministers agree that what has been tried so far hasn't worked and that other measures are needed.  No one seems to know what these 'other measures' might be.

Profit Motive:  Insurers spent $80 million trying to kill healthcare and even ran a secret campaign to trash Michael Moore's 'Sicko'.   Gee, I wonder why...

Math Quiz:  Nissan says it will be selling 500,000 electric cars a year by 2013.  That's world wide, of course.  If they sold all these electrics to the US, how many years would it take to convert the US light vehicle fleet to all-electric? _____ (Hint, there are 246 million light vehicles in the US fleet.)

One Trick Pony:  A report in the Washington Times claims that all of the population changes among the states in the last ten years are the result of personal income taxes. States with lower income tax rates gained population. But maybe people were moving so they could pay higher sales taxes – because states have to get their money somewhere and if not from the paycheck, then at the cash register. A silly piece of propaganda trying to demonize income taxes. Remember, traffic on the Brooklyn Bridge causes the tides to rise and fall – if you pick the right days.

SAR #10321

The Bill of Rights apparently protects ignorance and stupidity.

Irish Ayes: The Irish Troubles drag on.  The country so far refuses an IMF-EU bailout - it has seen what IMF bailouts do to countries and wants no part of it.  Nonetheless, hit squads from the IMF, the ECB and the EU are en route to twist arms.  What the Irish bankers want is for the EU to guarantee a public bailout of the private banking sector, as Washington did for Wall Street, with few strings attached. In the end Ireland may be held down and forced to swallow the cure, lest the euro world convulse.

Down In The Valley:  S&P sees house prices dropping another 7 to 10% during 2011.

Ministry of Truth:  CBS claims to have a poll that says that 81% of Americans think that using x-ray machines to screen airline passengers is a good idea.  The report did not indicate how many of these people had ever flown.  Nurse Napolitano, from atop the Homeland Security pyramid, asked for “cooperation, patience and a commitment to vigilance in the face of a determined enemy.”  She did not specify precisely who the enemy was, but Capitan Sully is on the list.

Word/Bond:  The word is that California will have a $25 billion gap in its budget through 2016.  That caused people holding California bonds to get antsy and start heading for the doors.  Curiously, the state – by law – must close each of these budget gaps through either cuts or tax increases.  Any idea why Jerry Brown wanted to be governor?

Fairgounds:  President Obama awarded the medal of honor to Army Staff Sgt. Salvatore Giunta at a White House ceremony on Tuesday.  In Arizona he'll still have to show them his passport.

By the Numbers:  The core Producer Price Index for Finished Goods for October was up 0.4%, about half the gain that was expected.  Take away the food and energy sectors and the PPI was down 0.6%.  Both industrial production and capacity utilization rates were flat m/m from September. At 74.8%, capacity utilization is far below normal.

Just This:  State AGs are ready to take some pocket change from the banks, accept a few token principal reductions (not to mention the principle reductions) and proclaim the great mortgage foreclosure fraud over.

Moment Of Silence:  There he was, on TV, smugly admitting that he had ordered water-boarding and other tortures, was proud of doing so, and would do so again – to protect the American way of life.  And we sat and watched and drank our beer.  Then the news came on and we learned that no criminal charges will be filed against those who destroyed the evidence of CIA abuse of prisoners.  Of course not, it was done in the name of the people. And Obama says that he and Bush and the men in the shadows are beyond the reach of the courts.  In the name of the people.

A Rose Is A Rose:  Obama’s promised change is nearly complete.  Just one or two more concessions and he'll be a Republican.

Usual Suspects:  By 2030 the demand for water in India will exceed possible supply by more than 40%.   A public/private group recommends that the distribution of free water cease and that India's water supplies be privatized and allocated based on the ability to pay. Farmers who cannot afford water will quit growing crops.  Customers that can't afford water or the more expensive crops grown with expensive water will die.  Those who control the water will get richer.  Win-win.

... and the Deep Blue Sea:  It is possible to cut enough government activities to eliminate the deficit.  It would be possible to raise taxes and cut spending sufficiently to – over a few years – pay off the national debt.  But these steps would require severe cutbacks and another, deeper recession.  And America would become some other, more Dickensian, place.

Quoted:  “The problem isn't that TSA has bad practices, the problem is that the TSA exists.”

SAR #10320

America's worst addiction may be lying to itself.

House Rules:  Hamid Karzai believes that as President he has some say about what goes on in Afghanistan.  Naturally General Petraeus, who is actually in charge, was surprised when Karzi said he wanted to send a lot of US troops home pretty damned soon and wanted the rest of them to stop knocking down doors at 3 AM.  Petraeus claimed that this would undermine whatever it is the US hopes to do there over the next decade or so.

Stirrings:  Retail sales were up 1.2% m/m and 7.3% y/y in October.  Without car sales, the increase was only 0.4%. S ales are back to within 2% of the pre-recession peak.  Where's the money coming from?

Day Care For Adults:  One way to cut government waste would be to dismantle TSA.  (1) True.  (2) Very True.  (3) Step over here...

Thimblerig:  Last Friday the government pointed at a shell and told you an incredible number of jobs had been created by the economy in October.  They also told you not to pay any attention to the stodgy old household survey, which didn't agree.  Turns out the pea wasn't under that shell – instead, they changed the way 'seasonal adjustments' are made and created 100,000 jobs.  Right out of thin air, just like dollars.

Bottom Line:  Rather than extend the Bush tax cuts to everyone including the obscenely rich, it would be far better to let the cuts expire for everyone.  The rich benefited most from the cuts and would lose the most from their expiration.

Special Pleading:  According to Vikram Pandit,  “There is a point beyond which more is not necessarily better.  Hiking capital and liquidity requirements further could have significant negative impact on the banking system, on consumers and on the economy.”  Mr Pandit should have added “and especially on Citigroup”, of which he is the head.  Add salt as necessary.

Flailing:  It really isn’t going to end, is it?   Not in Iraq in 2011.  Not in Afghanistan in 2014. Not ever.  Yemen's just getting underway.  Wars without end, Amen.

Reality Check:  The simple fact is we are spending too much on health care.  The health care cost discussion remains facile, avoiding the hard edges of the decision-making process. Health care costs consist of  1) profits, mainly those of insurance companies and for-profit hospitals,  2) administrative costs, and  3) the cost of health care itself.  We can cut 1 and 2 by going to a national single payer system and reverting back to community owned non-profit hospitals, ambulances, and clinics.  Controlling the actual cost of health care would require rational rationing (instead of rationing by money, which is what we have now) and a strong, tough-love approach to preventive health to cut the costs of obesity, diabetes, slothfulness and nutritional suicide.  And yes, death with dignity as opposed to plug 'em in and let 'em linger would have to be part of the solution.

Actions, Not Words:  Senator John Ensign (R-NV), who voted against the health care bill and speaks often and loudly against earmarks, got a $960,000 health care earmark for the University of Nevada.

Feedback Loop:  Science makes progress by discovering that it had previously made mistakes.  For example scientists have thought that the gigantic ice sheets in Greenland would take thousands of years to melt and that the seas would only rise a few inches, maybe a foot in a century.  Recent studies show that ice sheets know a few tricks about melting that the scientists are just learning, and that makes them pretty sure that the change in sea level will be at least three feet by 2100.  And while that's bad enough, check back in a little while – there is every chance that the three feet will become six.

Quoted:  "The only way you generate wealth is you make it, you mine it or you grow it.  Just exchanging things back and forth, services, it doesn't generate wealth. It just moves it.”

SAR 10319

The “will of the people” is an American myth.

"Clueless":  It’s never a good thing when another country calls your financial policy clueless.  It’s particularly bad if that other country is one of the world’s leading economies. It’s even worse when it happens to be right.  The fact that the rest of the world is beginning to see through the US charade suggests that the future is not going to be pretty.

Terminal:  It is inevitable. In the end you might as well relax and enjoy being ogled and felt up patted down by a bunch of ex-convenience store clerks.  Wear a hospital gown and some paper slippers.  Body cavity searches are only for flights of over 3 hours.

President Dangerfield?  All Obama brought home from his 10-day trip was a lousy T-shirt and a bunch of postcards. South Korea – which is still a US military outpost – refused to sign a free trade deal with the US, even though it has done so with Europe (and an Asian free trade area is in the works).  The G-20 ignored the US agenda, especially on 'rebalancing' currencies.  Is the fat lady practicing her scales?

Mulligan:  John McCain says he isn't willing to accept the Pentagon study showing that US troops are ready for DADT to be repealed because it came up with the wrong answers.

Revisionism:  The banks are encouraging Obama and the Washingtonians to retroactively legitimize the defacto replacement of county courthouses with the privately operated MERS system.  No more old fashioned paperwork filed and recorded in deed books, a permanent paper track of who owned what property.  States are suing MERS and the bankers claiming they are owed several billion in unpaid mortgage recording fees.  The banks say they don't need no stinking paperwork and want Washington to rule that they don't need to pay all those filing fees.  After all, who needs the money, Wall Street or all those county budgets out in the hinterland?

Dithering:  The Obama administration has decided not to decide to try KSM while continuing not to decide to decide not to try him and the other alleged 9/11 co-conspirators.  The same decision not to decide has also been made concerning possible trial by military commission at Guantanamo.  At least they decided something.

Good News for Dieters:  "In 20 years chocolate will be like caviar.  It will become so rare and so expensive that the average Joe just won't be able to afford it."

No Confidence:  “... with no solutions, all kinds of strange creatures started creeping out of the shadows. ...fraud has become a recognized if not quite admired way to wealth.  The political system is probably heading toward a real breakdown.  If you want a happy ending, you probably shouldn’t follow our political system too closely in the next few years.  Go see a Disney movie.”

Easy Come, Easy Go?  Civilizations do not collapse for a single reason but rather from a confluence of systemic crises like the seven confronting us: climate change, energy shortage, economic upheaval, terrorism, growing food insecurity, over population and a highly militarized world.  But we're all worried about getting our Social Security in 2047.

Bias:  The more effort that goes into preparing a meal, the better it tastes... to the cook.

Scratch That One:   Now the genetic geniuses have let loose male mosquitoes with an altered gene which causes their potential offspring's gene-reading machinery to malfunction, causing the embryo to mutate and die.  Don't worry, they're only going to release a few million of these critters into the environment - the altered gene won't get begin disrupting the development of human embryos for at least a decade.

Essay Question:  In as few words as possible  (one will probably do)  explain why 7 of the 10 richest counties in the US are those surrounding the District of Columbus.

SAR #10317

Things can be replaced. People can't.

Love Hurts:   Stop what you’re doing right now and go watch this video over at creditwritedowns!

At Ease:  A Pentagon study shows that most US soldiers have no problem with having gays serve openly and would support the end of Don't Ask Don't tell.  Now if the homophobes in Congress would only get the message.

To See Ourselves:  “American society is breaking apart. Millions of people have lost their jobs and fallen into poverty.  Help is not in sight: their government and their society have abandoned them.  Wall Street is chasing new profits again, yet for large sections of the nation that old myth of working your way up, of bootstrap success and its ultimate prize, home ownership, has evaporated.  The middle class, the America's backbone, is crumbling. The American Dream has turned into a nightmare...  The number of long-term unemployed keeps rising.  Worst off are families with children.  Every fifth child in the US lives in poverty today... And nobody seems to care.  And that's the view from the capital - of Germany.

Oil Is So Yesterday:  The International Energy Agency's new report says that it is most probable that conventional crude oil production "never regains its all-time peak of 70 million barrels per day reached in 2006."

For, By and Of the People:  About 60% of the electorate want us to get out of both wars, so of course the Administration plans on hanging onto both for a few more years despite promises to withdraw.  And to pay for these, we'll have to cut Social Security, gut Medicare and downgrade veteran's benefits.  I'm not really sure who won the election but I'm pretty sure who lost.

What's the Problem?  Iceland has joined Denmark, Finland, Norway and Sweden in investigating the extent to which the US is illegally spying on their citizens.  The US doesn't understand the fuss, says it has been doing so for a decade and intends to continue.

Be Careful What You Wish For:  If you are demanding austerity budgets and fiscal responsibility and no more deficit spending, you might want to check how many of your investments depend on government contracts – national, state and/or local.  Like Cisco. Wait till they cut the defense budget...

Numbers Crunching:  If the 'discouraged' workers get motivated to return to the workforce, it will take an additional 3.3 million new jobs just to keep unemployment under 10% - and that's without the 120,000 a month needed to accommodate population growth. At our current minimal rate of job growth, how many years will that take?

Left Hand, Right:  China's National Bureau of Statistics has been accused of understating inflation -- by another part of the Chinese government.  The Chinese Academy of Social Sciences says that Chinese inflation has been under-reported by over 7% over the last five years.  And you thought it was just the Bureau of Labor Statistics.

The Right is Right:  A Pew poll found that 66% of Republicans want their representatives to "stand up to Obama," and shut down the government early and often.  Just keep their Social Security checks coming, and don't mess with health care.

It's A Gas:  A subsidiary of Cheniere Energy wants to ship liquefied natural gas from Sabine Pass, Louisiana to China.  At least it's not tea.

Death Duties:  The main purpose behind estate taxes is to level the playing field somewhat and prevent the generational accumulation of ungodly wealth and the establishment of a royalty of wealth.  We wouldn't need estate taxes if we could find a way from keeping a tiny fraction of us from accumulating most of the nation's wealth.

SAR #10316

Remember, 95% of world's population are not Americans.

Game On!  Obama's visit was not enough to budge the long-stalled free trade talks between the US and South Korea.  Progress has been hampered by the US lack of understanding that it cannot negotiate from a position of power when doesn't have any.  European Union signed a free trade agreement with South Korea last month.  The G20 group of countries agreed to avoid  ”competitive devaluation" of currencies but fell short of backing the US push on China's currency.  Just another sign that the trade and currency wars are warming up.

One Way Wall Street:  Small investors have once again become convinced that stocks only go up up up, and that's  bad, bad, bad.

The Good News Is Bad:  Don't let the 4% decline in foreclosures in October fool you. The cause was not a sudden strengthening of the economy, it was the pause in forging fraudulent paperwork.  As soon as the robo-signing is legitimized (of course it will be, don't be naïve) it'll be off to the races again.

Shortcut:  The Debt-Reduction Commission plan has been released. There is no point in concerning yourself with these proposals, because not a one of them will survive the political process. Several won't even pass the laugh test.  Worry about something else for a while.

Strategic Withdrawal:  The Obama administration has decided to “de-emphasize” the promise to begin withdrawing from Afghanistan in July 2011 and to replace it with the vague suggestion that a withdrawal beginning in 2014 might be possible.  But the military is also talking about establishing “an enduring partnership with Afghanistan”.  Beats saying things are falling apart and we're planning on occupying the country indefinitely.

Prescience:  In the six months before Cisco announced that it expected revenue growth to slow by 50%, Cisco insiders sold 6,620,000 shares – 60% of their holdings.  Coincidence, just rebalancing their portfolios.

Eat Your Veggies:  Big Pharma plans to begin embedding microchips in medications, so that the pills can tell the doctor if the patient is taking the medicine properly.  A few modifications will be required before the pills will tell Homeland Security where you are and what you are up to – but you can bet they’re working on it.   They say it's for your own good – don't swallow that.

Extensions:  Social Security data shows that since 1977 the life expectancy of wealthy males at age 65 has grown 6 years, while those in the bottom half of the income curve have only added 1.3 years.  Guess who gets screwed when the retirement age gets raised, the janitors or the investment bankers?

How Safe Is Safe?  The government says that seafood from the Gulf is just fine.  Multiple independent tests disagree.  "I wouldn't eat shrimp, fish or crab caught in the Gulf," is the verdict from one research scientist.

Out Damned Spot:  If the Republicans get their way, government spending on science will be drastically cut: NASA by 15%, NIH down 9%, NOAA cut 34%, and NSF 19%. Republicans appeal to a constituency that neither understands nor trusts science, fearing that it will undermine religious faith.  (Don't need to waste money on science when you don't plan to use the results... )

Privatization:  Cops and other emergency vehicles have transmitters that tell traffic signals to turn green for them.  How long before some tax-starved city starts selling these devices to drivers who find red lights annoying?  California already has "Lexus Lanes" on freeways that restricted to drivers who pay a toll to use them.

Illegal Immigrants:  Genetic markers indicate that the people who introduced farming to Europe 8,000 years ago came from the Near East, and they brought their pigs with them.

Heads & Tails I Win:  If a mortgagee fails to keep the property insured, the loan servicer can – on behalf of the mortgage holder's interest – buy comparable insurance.  So far so good.  But what if the servicer owns the insurance company?  And what if the new policy costs 8 times what the lapsed one did?  And what if this enormous fee for the servicer is added onto the loan?  Well, then it's just business as usual in the mortgage foreclosure game.

Porn O'Grpah:  Nude descending a staircase.

SAR #10315

1981 – the last year we we discovered more oil than we consumed.

Angels on a Pin:  Representative John Shimkus, expected Republican chair of the House Energy Committee insists that we should not worry about global warming because  “The planet won't be destroyed by global warming because God promised Noah” it wouldn't happen again.  Nope, it's the fire next time.”

Squeaky Wheel:  Goldman Sachs expects oil prices to be “substantially higher” by 2012 as demand rises as the global economy recovers and Asian consumption expands while stockpiles shrink and production drops.  The flood of dollars released by the Fed's quantitative easing will also chase commodities higher, including petroleum.  Studies continue to warn that oil supplies will progressively fall short of demand (global production of crude oil peaked in 2004) long before substitutes for it are viable – especially as a transportation fuel.

Opinions Vary:  China's leading financial rating agency has downgraded the US from 'AA' to 'A+', citing “serious defects” in the US economic model and fear of a long-term US recession.  It also cited a “drastic decline” in the US government's intention to repay its debts. Some agree.  Others pointed out that interest rates show that US debt is considered to be among the safest investments in the world., which isn’t saying much these days.

Things to Worry About:  Global Warming,  Peak Oil,  Population Growth,  Resource Depletion, and Coronal Mass Ejection.  That's right, coronal mass ejection.  And read the comments.

Banking on Bankruptcy:  Ambac, which went bankrupt making bad bets, is suing to prevent the IRS from seizing $700 million from the company.  It does not argue that it does not owe the money, just that paying the taxman would be an inconvenience.   Try that at home – tell the IRS you can't pay them because you have other uses for the money.  Let me know how it works out.

Rush to Judgment:  The Republicans have announce they intended to eliminate the TANF Emergency Fund - which was designed to expand state level work-focused programs. They claim this will save $25 billion over the next decade.  Okay, but the program ended a while back.

Breaking it Gently:  “The unceasing declines in home values signal that we’re in for a long, bleak winter.”  Zillow reported an “unprecedented decline in house prices, no hints of stabilization...”  A record 23.2% of mortgages are now underwater.  Rather than a double dip, housing is “entering an unprecedented free-fall.”

Voo Doo Too:  The Bush tax cuts (and most of the rest of his economic policy) were a complete failure. They did not work then, they will not work now, and – according to the CPO – they will not work in the future. S o of course the Republicans will try to extend them .  Permanently.

Porn O'Graph:  Sisyphus.

SAR #10314

“What's good for GM is good for America” used to be just a slogan. It might even have been true.

Missremberinged:  A former had of the British House Intelligence committee and the current home shadow secretary both say that Bush's claim that information from waterboarding torture saved British lives is less than accurate.

Follow Me!  Germany's Finance Minister says the US should emulate Germany and increase its exports, decrease its imports.  Good idea. We could begin by not buying any more BMWs.

Humor:  The AP has discovered that the US may not leave Iraq at the end of 2011 after all. But it requires “a functioning Iraqi government” to ask for the invaders to stay, and Iraq hasn't had a functioning government in quite some time.

Horse/Water:  For the last couple of years the Fed has been pumping money into the banks, hoping to entice them to make more loans.  Two things – the banks can invest in US risk free Treasuries and few of the banks one-time customers either want to borrow money, or could meet the banks new standards.  Don't tell Ben, it'd upset his whole day.

Two to Tango: One way to lower the unemployment rate is to have more people drop out of the workforce.  Good news, unemployment is declining.  Guess what: People are dropping out of the labor market in droves.

Here Come da Judge:  GOP Representative Issa, the next chairman of the House Oversight and Government Reform Committee, plans to hold “seven hearings a week, times 40 weeks.”  But he promises not to wage partisan attacks even though Obama is “one of the most corrupt presidents in modern times.”  Fair and impartial, like FOX.

Reality Check:  The real unemployment rate is probably well over 20% if one ignores all the BLS gimmicks.

Nothing Down:  Earlier reports suggested that the $492.6 billion in deleveraging by consumers was pretty well accounted for by the $476 billion in bank write offs.  Now the NY Fed reports that the 2000 – 2007 annual average consumer borrowing of $330 billion has turned into a $150 billion annual reduction in debt.  That's $500 billion a year less in consumer spending.  There go a few stocking stuffers.

Fall Lineup:  Home prices fell 5% nationally over the last three months, after being on a plateau over the summer. Mortgage defaults increased for the first time this year.

Teaching Points:  There are 11.5 million homeowners in default (not the 4 million usually cited) and facing eventual foreclosure.  Even prime mortgages are facing an 18% default rate.  If these 11.5 million default, few US banks will be solvent.  Can you say “principal writedown”?  Neither can the banks.

Porn O'Graph:  Optimism, yet to be found or developed.