sâmbătă, 12 martie 2011

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis


Michael Moore Manipulates Student Fools Who Buy His Self-Serving Socialist Message; Mooore Declares "War" and Calls for "Student Walkout"

Posted: 12 Mar 2011 09:13 AM PST

Several seriously misguided socialist fools sent me links to a Michael Moore video clip appearance on the Rachel Maddow Show. They thought the video was some kind of "proof" that public unions were being mistreated.

Please consider Michael Moore Reacts To Wisconsin Union Vote: "This Is War"
Michael Moore is enraged after the Wisconsin State Senate voted to strip public unions of the ability to collectively bargain. Speaking on MSNBC's "Rachel Maddow Show," Moore said "they think they can get away with this."

Moore also calls for a "student walk-out" across the nation on Friday in response to the Wisconsin vote.

"This has to continue day after day and these governors have to step down," Moore declared.

"The rich have committed these crimes and the people will demand your ass is in jail," Michael Moore said with a pair of handcuffs on the set of Maddow's show.


Moore also shocked the audience by telling the rich and bankers that "we have a right to your money!"
Self-Serving Claptrap

Please click on the above link to see the video.

The sad reality is Moore makes hundreds of millions with his self-serving political claptrap and students are all the worse off for it. Student loans and public unions drive up the cost of education.

Moreover, public unions drive up taxes and that is why parents of many of these kids are in serious economic trouble.

Finally, as noted in Paul Krugman, Stephen Colbert, Bill Maher, others, Ignore Extortion, Bribery, Coercion, and Slavery; No One Should Own You! the issue is one of slavery.

No matter what grievances (legitimate or not) that Moore may have, slavery is never the answer. Yet Moore supports slavery as the solution.

If this is "War", I say it's about time. The nation needs to abolish slavery, and the action in Wisconsin is a good start.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List


European "New Deal" Debt Agreement is Same Useless Peer Pressure Model

Posted: 12 Mar 2011 12:52 AM PST

Eurozone leaders met in Brussels on Friday hoping to solve the European sovereign debt crisis. At the last minute Europeans Reach New Deal to Fight Debt Crisis.
European leaders agreed early Saturday to new measures intended to end the euro zone debt crisis, offering the debt-laden Greece a cut in its interest rate and injecting more flexibility into the way a bolstered bailout fund for the euro can be used.

The deal, which went further than had been expected at Friday's meeting of 17 euro zone leaders, came after a fierce dispute over corporate tax — pitting France and Germany on one side against Ireland on the other.

Because of the standoff, Ireland, which like Greece has accepted a bailout from the European Union and the International Monetary Fund, has not been offered a reduction in its interest rate, now about 6 percent.

The early morning agreement came alongside a deal on a pact called for by Germany and France to tighten discipline in the euro zone.

As expected, the current, temporary fund will be extended to allow it to lend its full 440 billion euros ($608 billion). The permanent fund that will replace it in 2013 will grow to 500 billion euros.

Under the latest agreement, the European Union's bailout fund will be able to buy bonds on the primary market but not on the secondary one.

However, those seeking a more comprehensive solution had pressed for more far-reaching changes, such as allowing the bailout fund to extend lines of credit to countries or letting it be able to buy bonds on the secondary market. Those ideas were not accepted.

Greece was given a concession on the length of its loan repayments to 7.5 years and agreed to a package with the European Union under which it would raise around 50 billion euros through privatization to cut its debt.
Trichet's Rulebook Two-Step

In clear violation of the "no-bail-out clause" in the Maastricht Treaty, the group voted to allow the ECB to directly purchase sovereign bonds.

Note that the ECB is is already stuffed with sovereign bonds. It bought them in the secondary market because buying them in the primary market was against the rules.

Flashback May 4, 2010: Trichet, a Monetarist Pussycat at Heart, Throws ECB Rulebook Out the Window
While the ECB is prohibited from buying assets directly from authorities, it can buy them on the secondary market. Trichet said on May 2 that "at this stage, we have absolutely no decision on the purchase of government bonds."
I said at the time "No Decision" means pussycat-hearted Trichet is considering it. And so it was. "No decision" quickly became a decision, in clear violation of the intent of the treaty.

With strong objections from German central bank president Axel Weber, Trichet started loading up the ECB's balance sheet with garbage.

Now the EU has voted to allow the ECB to buy bonds in the primary market but not the secondary one.

As noted above, this bond buying debacle is not part of the Maastricht Treaty. Thus German voters need to ratify this provision. In effect, German Chancellor Angela Merkel just sold Germany down the river to meet her political goals. She will not survive this.

Greece Gets Interest Rate Reductions, Ireland Doesn't

The EU group also decided to stick it to Ireland, refusing to lower its interest rate although it did agree to modify the terms for Greece.

Bloomberg reports Europe Boosts Bailout Fund With Primary-Market Purchases, Eases Greek Pact
Euro-area leaders retooled their rescue fund to stamp out the debt crisis, authorizing the facility to spend its 440 billion-euro ($611 billion) capacity and enabling it to buy debt in primary markets, while cutting the cost of bailout loans to Greece.

The officials rejected Ireland's bid for relief as Prime Minister Enda Kenny refused to yield to calls to raise its 12.5 percent company tax rate. The leaders also declined to permit the fund to finance bond buybacks of debt-strapped states.

The accord was unexpected, coming at the end of a session that began after 5 p.m. following daylong talks among the 27 European Union heads on a response to the uprising in Libya. Officials in Germany and France this week said they didn't expect a comprehensive agreement until a summit March 24-25.

In return for the euro region acceptance of her conditions on controlling debt, Merkel swung Europe's biggest economy behind plans to allow greater flexibility and firepower in the EU rescue fund, the European Financial Stability Facility.

With two weeks to the March 24-25 summit endgame, Merkel and Sarkozy clashed with Kenny over corporate taxes. They had insisted on a common corporate tax base as the condition for agreeing to ease the terms of Ireland's 85 billion-euro bailout. Kenny rejected that position, calling it "harmonization of taxes through the back door."

Ireland's main corporate tax rate is 12.5 percent, compared with an EU average of about 23 percent and even higher rates in Germany and France, which it has used to lure companies such as Hewlett-Packard Co.

The European Commission, the EU's executive body, will present a proposal on a common corporate tax base in the coming weeks, the agency said. Ireland will think it over and come back to the rest of the EU within two weeks, Merkel said.

Talks on a deal for Ireland "will be difficult and detailed but I am convinced and remain convinced that there will be that we can find a way forward," Kenny said.
Kenny Holds The Line

Will the real Kenny please stand up? The previous article makes it appear Kenny is about to collapse. A second Bloomberg article below makes it appear otherwise.

Please consider Ireland Bid for EU Relief Rejected as Kenny Holds Line on Increasing Taxes.
Euro-area leaders rebuffed Irish Prime Minister Enda Kenny's bid for easier bailout terms, demanding that Ireland raise tax rates in return, as they rewarded Greece with a cut in its rescue-loan costs.

"We weren't really satisfied yet today with what Ireland pledged," German Chancellor Angela Merkel said after a summit that ended about 1:30 a.m. in Brussels. "We can only offer the interest-rate cut when we have something in return."

Kenny, arriving for his first summit as Ireland's leader, refused to buckle under pressure from Merkel and French President Nicolas Sarkozy as he pushed for relief on the 5.8 percent interest rate the country pays on the 85 billion-euro ($115 billion) rescue package it received in November.

On raising the tax rate, "I made it perfectly clear on many occasions that this is not something that I could or would contemplate and didn't this evening," Kenny said. He said talks would continue through a summit scheduled for March 24-25.

Ireland's main corporate tax rate is 12.5 percent, compared with an EU average of about 23 percent and even higher rates in Germany and France, which it has used to lure companies such as Hewlett-Packard Co. to set up in the country.

"We're not asking Ireland to put up their corporate taxes to the European average, but to make some effort," Sarkozy said.
Raising Corporate Taxes a Foolish Tradeoff

Kenny is a fool for putting himself in this position. Somehow the discussion is about pissy reductions in interest rates in return for unwise corporate tax hikes. The discussion ought to be on how big the haircuts will be. If Kenny comes to his senses, which is by no means certain, he should put the issue of haircuts to a vote.

I think somewhere in the neighborhood of 15 cents on the dollar is about right. If put to a vote, German and French banks would be lucky to see anything at all.

Watered Down Proposals

In spite of all this talk about agreement to a new deal, no real issues were solved.

It makes little difference if the ECB stuffs itself with garbage via the primary or secondary market. Neither way makes any sense.

Moreover, Germany wanted strict rules on raising retirement ages, aligning corporate tax rates and on debt limit enforcement mechanisms.

Instead, "after objections from a host of smaller countries, the proposals were loosened to allow countries to set their own targets. Sanctions are not envisaged, and the commitments nations enter into will be subject to peer pressure instead."

Agreement To Do Nothing

One way to get agreement is to agree to do nothing, which is essentially what happened.

There is no agreement on tax rates, on retirement age, or on sanctions. As before, everything boils down to "peer pressure". Yet one of the reasons Europe is in a mess is that peer pressure does not work.

Also note that we have not yet heard from Irish citizens who will be irate over favoritism to Greece. Perhaps they will force Kenny to get a backbone.

The same applies to Merkel's willingness to play loosey-goosey with German voters and the Maastricht Treaty.

Thus, for all the brouhaha about a "New Deal", nothing has changed except Greece has a slightly lower interest rate, and a few more years in which to "not" pay back its debts. Odds are still high that Greece and Ireland default. The only question is whether default occurs sooner rather than later.

For additional information, please see yesterday's article ECB Stuck in Sovereign Debt Garbage, Seeks German Help to Unload It; Anger in Greece, Ireland; Germany Sets High Price for Bailout Changes

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List


Your Weekly Address: Women’s History Month and Fair Pay

The White House Your Daily Snapshot for
Saturday, March 12,  2011
 

Your Weekly Address: Women’s History Month and Fair Pay

The President pays homage to former First Lady Eleanor Roosevelt, commends the great strides that have been made to create a more equal American society, and reaffirms his resolve to pass the Paycheck Fairness Act.

Watch the video.

Weekly Address

Weekly Wrap Up

Earthquake in Japan and Tsunami Preparedness: The President and First Lady express their deepest condolences to the people of Japan as the President meets with senior officials to discuss how the US can help, and how it may affect U.S. states and territories.

Conference on Bullying Prevention: The President and First Lady host the first-ever White House Conference on Bullying Prevention dispelling the myth that bullying is just a harmless rite of passage or an inevitable part of growing up. See their video message on the issue.

Chat About America's Great Outdoors: Join Secretary of Agriculture Tom Vilsack and Secretary of the Interior Ken Salazar for a live chat about conservation and getting involved.

A New Voice for Students: The Consumer Financial Protection Bureau (CFPB) creates an office for students to provide you with tools for you to make the best decisions about credit.

Better Budget, Better Government: The President creates the President’s Management Advisory Board and proposes more than 200 terminations, reductions, and saving to cut our deficits while investing in the areas critical to long-term economic growth.

New Photostream: Go Behind the Scenes in February.

West Wing Week: "Law School in 15 Seconds"

Vice President Biden in Russia: The Vice President hails the successful “reset” of U.S.-Russian relations and reiterates his call for broader economic cooperation between the two countries.

International Women's Day: First Lady Michelle Obama and women from around the world to celebrate the 100th Anniversary of International Women's Day.

A New Ambassador to China: President Obama names current Secretary of Commerce Gary Locke his new ambassador to the People's Republic of China.

100 Youth Roundtables: The President announces 100 Youth Roundtables happening around the country. Host a roundtable in your community!

Patent Reform Explained: Austan Goolsbee's back on the White Board to explain the President's plan to reform the patent system.

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Seth's Blog : Your SXSW agenda (or any conference, for that matter)

Your SXSW agenda (or any conference, for that matter)

It costs a ton of time and money to go to something like SXSW. Other than having a blast, why go?

Here's an interesting way to think about it, something I've used to change the way I attend events (I don't do many, and won't be there, so have fun without me):

Think back a year ago to the last time you went. What do you remember?

Do you remember the presentations that were later on videotape? Do you remember the special screenings of movies? Do you remember the crowded cocktail parties? Bumping into a net celebrity?  I don't.

So I don't do them. At the last TED, I didn't attend a single session. They're fabulous, but I can always watch them later, on video.

Instead, I focus on what I do remember: the engaged conversations. The one on one discussions of what someone is working on. Helping a friend design a book cover or solve a thorny entrepreneurial problem. Sneaking out to go to a taco stand for lunch with a very cool CEO...

These are the reasons it is worth going. (At least for me). So do more of that, I think.

This isn't easy to do. Most conferences are organized around mass, not around individual interactions that last. It takes an effort to seek out conversations that matter.

Will people miss you if you don't show up next year? Why?

 
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Seth's Blog : Relentlessly smaller

Relentlessly smaller

Some people work overtime to make their jobs smaller.

If your job is smaller you're less likely to make a mistake and more likely to please your boss.

But that's a pretty dumb bargain. You're exchanging your upside, energy, opportunity, growth and excitement for the freedom from thinking and a decrease in self-induced anxiety.

What a shame.

 
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