Central Perk: 30 dec. 2012

duminică, 30 decembrie 2012

Mish's Global Economic Trend Analysis

Poison Pill and Gold Debate
Ho Hum - Fiscal Cliff Deal Stalls - Republicans Offer More and More Concessions; Poison Pill Nonsense
Online Education and College Degrees at Far Lower Prices is the Future; Virtual Classrooms to Reach 1 Billion People

Posted: 30 Dec 2012 08:15 PM PST

In Ho Hum - Fiscal Cliff Deal Stalls - Republicans Offer More and More Concessions; Poison Pill Nonsense I stated ...

"The real poison pill is allowing Social Security and Medicare costs to escalate unabated. Does anyone in either party want to admit the truth? ... the best hope still remains that all compromises fail."

The above thought prompted Uncle Frank to respond in a comment "Mish relishes chaos and financial ruin for this country so his gold holdings shoot-up in value. Everyone has an ulterior motive you know."

Ulterior Motives?

Since I get accused of this sort of thing quite frequently, please let me point out a few things:

Gold has been sinking, as it should, if Congress is fiscally prudent.
Government Should be Prudent
Government Won't Be Prudent

Should Congress be fiscally prudent (and the fiscal cliff is not close to being fiscally prudent), I would change my stance on gold in one second flat.

Nonetheless, should Congress fail to address the Fiscal Cliff, I would expect the exact opposite of what Uncle Frank suggests.

In short, regardless of my personal beliefs regarding gold (that one would be prudent to buy and hold gold), I actually advocate government and Fed policies that are contrary to my recommendations.

My reasons are easily explained:

Neither the Fed nor the government gives a damn about what is fiscally prudent.
Both the Fed and Congress are highly likely to debase currency, causing gold to rise, even if I think that is bad economic and fiscal policy, which of course I do.

Thus the accusations of Uncle Frank, and countless others before him are 100% baseless. Should Congress actually do what I expect, I think it would not be good for gold.

I recommend governmental actions on the basis of policy merit alone, not based on my stock market positioning. I find it very sad that few others do the same.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

"Wine Country" Economic Conference Hosted By Mish
Click on Image to Learn More

Ho Hum - Fiscal Cliff Deal Stalls - Republicans Offer More and More Concessions; Poison Pill Nonsense

Posted: 30 Dec 2012 05:03 PM PST

Republicans have offered more concessions including an agreement to hike taxes on those making as little as $400,000 (up from the $250,000 sought by Obama). They also backed down on a proposal to slow the growth of Social Security benefits.

They may as well throw out the white flag at this point. While I do not know if they reach a compromise today, it appears Senate Republicans are willing to do more than they should.

The fact remains this is a pathetic effort by both parties to rein in unsustainable budgets.

Please consider Fiscal deal stalls as clock ticks to deadline

Efforts to prevent the economy from tumbling over a "fiscal cliff" stalled on Sunday as Democrats and Republicans remained at loggerheads over a deal that would prevent taxes for all Americans from rising on New Year's Day.

One hour before they had hoped to present a plan, Democratic and Republican Senate leaders said they were still unable to reach a compromise that would stop the automatic tax hikes and spending cuts that could push the U.S. economy back into recession.

"There are still serious differences between the two sides," said Senate Democratic leader Harry Reid.

Progress still appeared possible after the two sides narrowed their differences on tax increases and Republicans indicated they would withdraw a contentious proposal to slow the growth of Social Security retirement benefits.

The two sides were close to agreeing to raise taxes on households earning around $400,000 or $500,000 a year - higher than Obama's preferred threshold of $250,000 - several senators told reporters.

Republicans aim to pair any tax increase with government spending cuts to benefit programs that are projected to grow ever more expensive as the population ages in coming decades.

But their proposal to slow the growth of Social Security benefits by changing the way they are measured against inflation met fierce resistance from Democrats. Obama included the proposal, known as "chained CPI," in an earlier proposal, but many of his fellow Democrats remain opposed.

'POISON PILL'

"We consider it a poison pill - they know we can't accept it. It is a big step back from where we were on Friday," a Senate Democratic aide said.

Poison Pill Nonsense

The real poison pill is allowing Social Security and Medicare costs to escalate unabated. Does anyone in either party want to admit the truth?

Apparently not, but that is hardly news to anyone with an eighth-grade education in math.

As the bargaining continues, it will be up to the House to reject whatever nonsense the Senate comes up with, because if not in December, the Senate will come up with something in January at the current rate of Republican concessions.

Every compromise to date leaves the US worse off than if the fiscal cliff happens. Thus, the best hope still remains that all compromises fail.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Online Education and College Degrees at Far Lower Prices is the Future; Virtual Classrooms to Reach 1 Billion People

Posted: 29 Dec 2012 11:36 PM PST

I received an interesting email from "James in Arizona" today. James offers this comment on online education.

Greetings from Arizona, Mish,

I ran across this website while exploring various online options for my daughter (in high school, but she's very computer savvy, so I'm looking for options to expand her interests/basis). It is EdX, an online education group started by Harvard and MIT, but other universities are joining.

Hopefully this online education program will finally put a torpedo in the expense of college.

Have a wonderful New Year, and thanks so much for the effort you put forth on your blog, and educating those like me.

James in Arizona

Virtual Classrooms to Reach 1 Billion People

The above video is a disappointing infomercial, but the courses available are genuine.

Here is a sample of free courses offered in the link above.

Foundations of Computer graphics
Circuits and electronics
Artificial intelligence
Software as a service
Quantum Mechanics and Quantum Computation
Introduction to Solid State Chemistry

The classes are free but unfortunately you do not get credit hours for them. Eventually you will.

The cost of education will come down for the simple reason it has to. The price of college education is not only ridiculous, but unsustainable.

The plunge in education costs will likely not happen soon enough to help James' daughter but it most certainly will help those with much younger kids.

If you do have kids in high school now, please encourage them to sign up for some of those classes to get a head start.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Damn Cool Pics

A Cure For The Stressed Life Of A College Student [Infographic]

Posted: 30 Dec 2012 01:04 PM PST

Juggling the demands of higher education and life's other responsibilities can create challenges leading to additional stress for students. The American College Association recently reported that 81 percent of college students suffer from extreme exhaustion by the end of their first year. Help, however, might be in the palm of your hand. These sixteen apps will better organize your schoolwork, finances and social life, and assist in alleviating physical stress.

Click on Image to Enlarge.

Via: SNHU Online College

Seth's Blog : Sooner or later

Sooner or later

Tomorrow is the biggest day of the year for charitable giving in the US.

The reason is clear: if you make a donation Tuesday, you have to wait a whole year to get a deduction. Make it today and you get it right now.

Of course, charitable giving shouldn't be driven by the search for a tax deduction, but the knowledge that now is your last chance short-circuits the sooner or later decision.

So, today, before it's too late, why not help build a platform for those that need it, a platform that generates a hundred or a thousand times more pareto-optimal joy. Not because there's a heart-tugging pitch or an external urgency, but because sooner is better than later.

Room to Read, The Acumen Fund, Juvenile Diabetes, DoSomething, Afaya

Sooner rather than later. We'll get there if we all head there.