Turns
out that if you give sick people health insurance, they use it.
Bummer.
Humble
Pie: In an act
of either confession or contrition, SF Fed President John Williams
says that our persistent low interest rates may reflect a serious and
lasting change in the US economy that does not fit with any of the
explanations or expectations of economists or central bankers. In
other words, the guys at the Fed don't know what's going on or what
to do about it. The ECB's
Mario Draghi agrees and cautions that “the slowdown is probably
not temporary.” They're going to be sent to bed without supper.
Secrets
Here And There:
When our gang got around to telling us that the US “would begin
direct action” against ISIS in Syria, “would begin” was
somewhat disingenuous – some US boots have been on the ground there
for some months. And if they were doing things right, it wasn't a
secret to ISIS, just us.
Sad,
But True:
There is no free lunch. “Whether
it’s the lotto or the stock broker or the fantasy sports leagues or
Las Vegas, someone is always ready to take advantage of your desire
for a free lunch. The sooner you start picking up the tab for your
own meals, the better off you will be.”
Reinventing
the Wheel:
The
folks at the Fed claim they are looking for some way to avoid another
taxpayer bailout of the big investment banks. Couple of points:
The taxpayers did not have to bail them out the last time – there was no legal nor moral reason to do so - the
bailout was an enormous fraud.
The way to avoid bailing out the TBTF banks is called
Glass–Steagall,
or used to be. Reinstating Glass–Steagall
and putting a few dozen big bank senior officers in jail for felony
fraud should work quite nicely. And at absolutely no cost to 99% of
taxpayers. Count it as a lesson learned. Twice.
Prey
Day Lending:
There
are companies out there which, apparently legally, con retired
soldiers into selling part their pensions in return for small loans.
Like $5,000 in return for 60 monthly payments of $510 from
their pensions.
That's $30,600, and
is
equal to about
a 43%
interest rate. Someone
ought
to be protecting the ones that have been doing the serving.
Thinking
On Things:
Supply
and demand is supposedly the underlying basis
for our economy. Except in the
housing market. In
the housing market, demand drives up the price and drives down the
supply as people hold their houses off the market expecting bigger
profits later on. And when potential buyers see prices rising, they
hurry to buy and drive the prices up before prices are driven even
higher. So, higher prices increase demand, just the opposite
of what economists
tell us should happen. Either they don't know what they're talking
about, or we are not doing things right. Or both.
Perfection:
In the third quarter US
GDP grew (if that's the term for it) at a 1.5% annual rate, down
sharply from the 3.9% we're supposed to pretend was reached in the
second quarter. For
the first three quarters of the year GDP has risen at a less
than zippy 2.0% annual
rate. Inflation is
conspicuously absent, so the Fed will keep fighting it. They're
getting quite good at solving the wrong problem.
Rules
Is Rules: Back
in the day there were rules prohibiting the use of religious
organizations as cover for espionage. That was before Bush/Cheney.
The good news is their Defense Department did not suborn a real
Christian NGO; the bad news is they created and funded one out of the
basement of the Pentagon and recruited God to spy on North Korea for
them. And that's the Gospel.
Missing
Inaction:
Eight years ago the
world's central banks began lowering interest rates to zero in hopes
of stimulating the economy. If it doesn't work pretty soon, maybe
they'll try negative rates. Oh, wait... Either the economy is
failing, or the economists are.
Shelling
Out: Shell's
third quarter earnings took big hits from continuing low oil prices,
the write-off of the Arctic adventure, and a suspension of
development in a Canadian oil sands project. They also wrote off $2.3
billion as the cost of dumping shale oil prospects in the US.
Don't
Touch That Dial:
Microsoft knows you want Windows 10, so it is going to automatically
download to your Windows 7 or 8 machine. Say goodnight, Gracie.
3 comments:
I am not sure what you mean by the taxpayers did not bail them out the last time.
Aside the admittedly comparatively modest direct bailouts, there were trillions of dollars in value bestowed on the banks in the form of guarantees and subsidies, emergency rules, regulatory forbearance, etc. Much of it impossible to measure in value except that it provided life whee there should have been death.
These were dead banks walking, and the government used every bit of value not nailed down to protect them from a killing blow.
Homeowners did not get this treatment. Unemployed did not get this treatment. Retirees did not get this treatment. Municipalities and pension funds did not get this treatment.
As a result of creating a roving long-term protective bubble around the banks, the government absorbed, bought off, deflected, or legislated away every threat, no matter what the cost to anyone or anything else.
And all of this, these trillions of dollars of value rained on the banks, served the important function of protecting the executives and the shareholders and bondholders.
So the banks live on and grew instead of dying the imploding deaths they deserved. And everyone else sucked eggs.
In doing this, the government upset the order of the universe, they want back in time and violated the butterfly effect (see "Sound of Thunder," Ray Bradbury). And they did so by spending up the taxpayers money and credit and democracy and common wealth.
I am oh so sorry - I was neither clear nor accurate. I meant "bail" not "bill". And that sentence should read something like: "The taxpayers did not have to bail them out the last time – there was no legal nor moral reason to do so - the bailout was an enormous fraud."
The rest of you comment is spot on. That BofA, Citi and Goldman still exist and none of their leadership (nor several then-members of the Fed and Treasury) are still free is the crime of the century.
Yes, and one of the biggest reasons there has been no recovery. All the 'stimulus' went to revive the cancer that is american finance. So now we see part 2 on the horizon, with the added gift of the trillions of debt that went to said stimulus. The parasite is killing the host, it remains to be seen what survives the coming collapse.
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