In this country, at least.

Simon Johnson, co-author of "13 Bankers" describes the rise of concentrated financial power and the threat it poses to economic well-being. He explains that over the past three decades, a handful of banks became spectacularly large and profitable and used their power and prestige to reshape the political landscape. He argues that the largest banks have become more powerful and more emphatically "too big to fail," with no incentive to change their behavior in the future. Is this setting the stage for another financial crisis, another government bailout, and another increase in our national debt?

REALLY EXPLAINS THE LAST 10 YEARS OR EVEN 20....AND PREDICTS!

Hillary Clinton just can’t catch a break. As her self-inflicted imbroglio over erasing 30,000 emails involving her time as Secretary of State continues to command press attention, the April issue of Harper’s Magazine is focusing gasp-worthy attention on the “loan-sharking” business that Bill Clinton, as President, assisted in transforming into the too-big-to-fail Citigroup that played a leading role in bringing the country to the brink of financial collapse in 2008.

Janet Yellen’s Fed can’t be too happy either about the revelations. The Fed just gave Citigroup a clean bill of health last week under its so-called rigorous stress tests and is allowing the bank to spend like a drunken sailor, raising its dividend 400 percent with permission to buy back as much as $7.8 billion of its own stock. The Fed’s qualitative portion of the stress test is said to look at both risk controls and the internal culture of the bank. Citigroup remains under multiple criminal investigations for money laundering and involvement in rigging currency markets. Apparently, in the Fed’s eyes, this is now de rigueur on Wall Street.

Harper’s six-page article jolts the reader with nugget after nugget unearthed from Citigroup’s unseemly history – facts that both the Clintons and the Fed would no doubt prefer to stay buried. This epistle to greed and excess and regulatory hubris is written by Andrew Cockburn, Harper’s Washington Editor and a man well credentialed to do it justice. Cockburn and his wife, Leslie Cockburn, co-produced the documentary, American Casino, which provided an in-depth look at the players behind the 2008 financial collapse. Cockburn’s father, Claud Cockburn, was on the scene in 1929, covering the epic crash for the London Times. (His memoir of Black Thursday on Wall Street in 1929 can be read here.)

The Harper’s article is subtitled “The catastrophic incompetence of Citigroup,” obviously a tongue-in-cheek assessment since Cockburn meticulously documents the serial charges of crimes at Citigroup as a business model....

http://wallstreetonparade.com/2015/03/the-clintons-and-the-fed-are-gasping-over-the-april-issue-of-harpers/

http://www.cnbc.com/id/102519842?__source=yahoo|finance|headline|headline|story&par=yahoo&doc=102519842

How do you improve the culture of Wall Street and restore faith in finance? Personally punish the industry's bad apples, according to two longtime observers.

"I think we need to personalize the penalties for those who are sinners. It's got to hurt them individually," Charles Ellis, a prominent investment consultant and author, said at an event this week in New York on improving the financial industry. Ellis, who founded institutional advisor Greenwich Associates, said that new laws after the financial crisis didn't go far enough because companies—usually via public stock owners—still pay penalties for misbehavior, not people. "We've got to get past the idea of sending it against shareholders and writing it off the balance sheet," Ellis said.

John Rogers, former CEO of the CFA Institute and previously a top Invesco executive, agreed.

"Making senior management personally responsible resonates with me. That's true for actors down inside the banks too. They need to be apprehended, tried and punished," Rogers explained, speaking alongside Ellis. Rogers added that misbehavior would happen again, making existing oversight mechanisms important. "To think that the banking system is ever going to have just white hats on is unfortunately not going to happen. That's why there are safety nets in place to help deal with that," he said. The safety nets that Rogers referred to include federal oversight put in place after the financial crisis, including higher cash reserve requirements for banks. While Ellis took a harder tone, he did note that most people on Wall Street are ethical. "It's a very small fraction of people, and usually with a very small fraction of their time, that did things that were really crummy," he said. Still, Ellis was highly critical of certain behavior before the financial crisis. "We have had some real SOBs," he said.

Ellis gave the examples of former Lehman Brothers CEO Richard Fuld, who now acts as a deal consultant at a small firm he founded, Matrix Advisors in Manhattan. He also called the "former CEO of Merrill Lynch"—presumably Stan O'Neal—"probably one of the most despicably behaved human beings we've ever seen in this country." O'Neal famously left Merrill Lynch with $161 million in accumulated benefits as the bank fell into crisis. O'Neal has largely disappeared from public view besides serving on the board of metal company Alcoa. (The next CEO was John Thain; Ellis later declined to clarify which executive he meant.) "You think, what penalties have they paid? Maybe a little embarrassment with their kids' friends who all know what happened, sort of," Ellis said. "Most of it has been a free pass."

Ellis also mentioned former Goldman Sachs trader Fabrice Tourre, who was punished. Tourre was found liable for defrauding investors in mortgage-backed securities; he paid a fine and is now pursuing a doctorate in economics at the University of Chicago. Ellis said if Tourre's supervisors had been more afraid of personal penalties, they would likely have spotted and prevented his actions.

A spokesman for Bank of America Merrill Lynch declined to comment. A spokesman for Goldman Sachs did not respond to a request. Fuld did not respond to a request for comment left with his assistant at Matrix. Tourre did not respond to an email. Attempts to contact O'Neal were unsuccessful.
MORE

http://wolfstreet.com/2015/03/17/gdpnow-nowcast-drops-to-near-zero-escape-velocity-investment-structures-oil-drilling-rigs/

It’s hard to measure the growth rate of a vast, complex economy with just one number, accurately, and on a timely basis...The Chinese found an ingenious solution. They decree the growth rate and announce it in advance, and that’s about what the number says when it comes out. It’s faster than any other major country can produce its GDP numbers. It avoids nasty surprises and doesn’t need messy revisions. Whether or not establishing statistical data by decree is an accurate reflection of reality is a hotly disputed topic. But then, the accuracy of any statistical data is a hotly disputed topic.

In the US, it’s a slog to get to the final answer. Quarterly changes in GDP, as measured by the Bureau of Economic Analysis, come in a series of estimates. The first estimate gets all the press, but subsequent revisions in the second and third estimates can be significant. Further revisions follow over the years. By the time the BEA has a fairly good handle on what actually happened back in the day, no one cares anymore...So the Atlanta Fed started a new approach in 2011. The forecasting model is supposed to reflect a more immediate picture of the economy. Taking into account economic data when it is released, the model adjusts its GDP forecast accordingly and closer to real time. It has plenty of quirks. It’s jumpy as it reacts to incoming monthly data that is itself highly volatile and subject to revision. But it’s a good indication of where the economy has been going over the past few months.

And according to this “nowcast,” as the Atlanta Fed calls it, the economy is going to heck.

The economic reports that filtered into the model over the past few months ranged from mediocre to very lousy, with the exception of the jobs reports, which were considered “robust.” The most recent set of reports, released over the last few days, dragged the GDPNow forecast to an annualized growth rate of a near-zero 0.3%. A couple more crummy reports, and this may turn negative...The blue area in the chart below is the range of the so-called Blue Chip consensus forecasts. Now even the most pessimistic among these forecasters are way too enthusiastic, though they’re also dialing down their exuberance:



The biggest culprit?

Turns out, the oil bust is being felt despite assurances last fall from our preeminent economic gurus, who’d postulated that the oil bust – the lower price of gasoline – would act like a stimulative tax cut. Which I have been debunking ever since they first brought it up. It was one of the simplest things to debunk. It was just basic math...So today, the Atlanta Fed specifically mentioned drilling activity in the oil patch, as measured by the collapse in the count of drilling rigs. This collapse in drilling activity knocked the category, “investment in structures” down from an already terrible negative growth rate of -13.3% to an even worse -19.6%. These non-residential investments in structures are important factors in GDP. And one of the most prolifically investing sectors in recent years, oil drillers, has been slashing these investments. Drillers are trying to make their cash flow less negative so that they don’t run out of money before the bust is over. They want to survive...Investments in residential structures also deteriorated from a growth of +0.1% to a decline of -3.2%. And goods exports skidded further...So this is what the eternal promise of “escape velocity” looks like when it collides with reality in real time. Wall Street keeps holding up the promise that “escape velocity” would soon be reached in order to rationalize irrational stock prices. It has worked wonderfully for six years. Stocks have soared, while “escape velocity” has remained a false promise. But now we have in fact “escape velocity,” only this one, at least for the moment, is headed in the wrong direction: it’s headed south.

And there are deeper problems: a sudden Lehman-Moment-like spike, but worse than in October 2008.

http://www.marketwatch.com/story/6-investing-lessons-from-the-federal-reserve-2015-03-20

Forget ‘Fedspeak’ — watch what the central bank does

For years, investors have profited living by the credo “Don’t fight the Fed,” so when the central bank made changes in its verbiage this week — hinting that it could raise rates later this year — it sent investors into a bit of a tizzy. That said, investors might be better off trying to live by their own version of the Federal Reserve’s words, rather than focusing on its actions...“Fedspeak” first came into the public lexicon under former Chairman Alan Greenspan, who was famous for making cryptic comments using obtuse word choices. Princeton economics professor Alan Blinder defined Fedspeak as “a turgid dialect of English.”...The latest focus on Fedspeak has revolved around one word, “patient,” but in the past the spotlight has been on everything from “irrational exuberance” and “policy accommodation” to “measured” and “data-dependent.”

Individual investors, of course, are their own central banker, setting their own policies. If that policy is “don’t fight the Fed,” then you typically would be backing away from stocks now, because when the Fed increases rates, it takes that step to prevent the economy from overheating, which could fuel inflation, and rising rates historically have preceded bear markets and recessions. But rather than focus on your strategy in the face of the Fed’s wording change this week — because even with the change in language this week, plenty of observers don’t think the Fed will actually hike rates until 2016 — consider instead the Fed’s words that should be the linchpins of your personal policy. From central bank to your bank account, they don’t change much; what matters is how you define them and apply them. With that in mind, here are six examples of Fedspeak and how they might apply to your own investments:

1. ‘Patient’

In Fed world, this is a euphemism for “things aren’t changing.” While the Fed was being patient, rates were not going to rise. It’s important to recognize, however, that excluding the word did not mean the central bank was moving all the way to “impatient.” In an individual’s lexicon, being patient, therefore, amounts to sticking with an investment versus putting it on the “watch list.” When patience starts wearing thin, it’s a sign that you might want to reconsider an investment, shorten the leash that you give a fund manager or a stock when it comes to disappointing performance, and start to think of what your next move might be.

‘Data dependent’

In Fedspeak, this means that any decision made today holds until there’s some quantifiable reason to change the policy. It’s no different for individual investors. For example, consider the simple question of “Should I rebalance my portfolio?” Someone who is not data-dependent considers rebalancing — where holdings are adjusted to put the portfolio back onto its target asset allocation — a regular chore and does it annually, regardless of market conditions. A data-dependent investor would say the move isn’t necessary until the portfolio is 5% or more off of its targets and profit-taking seems prudent. Investors have to decide which part of their investment program they follow regardless of market conditions, and what moves are dependent on the data, whether that means personal numbers like the return of a portfolio, or big-picture numbers like how they will invest when they finally see a rate hike.

‘Measured’

Dating back to the Greenspan days — when the former Fed chairman said low-rate policies could be reversed at a measured pace — this is a term that, for individuals, describes slow, considered movements. For example, an investor nervous about the market being near all-time highs and having been without a significant downturn in more than six years could take the measured response of taking some profits, culling winners and slowly making their portfolio more defensive. While investors would always like to believe their responses to market conditions are measured, the truth is that many are knee-jerk, in-or-out, all-or-nothing moves. That can be fine — if you believe market conditions call for you to be on the sidelines completely, selling everything could be a “measured” response — but most individual investors want to avoid extremes, so a truly consistent, compromise position tends to work best.

‘Considerable time’

In Fedspeak, this was used by former chair Ben Bernanke and current chair Janet Yellen to signify “for the foreseeable future.” For individuals, however, a considerable time is more like “enough time.” You want to stick with a new fund manager for enough time to prove that he or she can do as well as the predecessor, you want to make sure your investment strategy is not over-reacting to the nearly random day-to-day machinations of the market. Ideally, any time an investor makes a move that moves their portfolio in a different direction, they would have given the old strategy — and they’re prepared to give the new one — considerable time to work. Depending on the strategy, the number of days in “considerable” is flexible, but individuals should have their own definition for it in advance.

‘Accommodation’

This is what Greenspan called a policy that was making the most people happy. For individuals, sometimes you need to make your own accommodations, taking actions that might not be textbook perfect, but that work for you. For example, if you have a diversified portfolio but you’re not comfortable with investing in, say, emerging markets or small-cap stocks, you can avoid those asset classes. Yes, it will affect overall portfolio performance and volatility, but you can make that accommodation so that you sleep better at night. The more comfortable you can be, the easier you can stick with a strategy that you believe will pay off over time.

‘Irrational exuberance’

Perhaps the most famous example ever of Fedspeak, it was Greenspan’s way of warning that excessive enthusiasm for a roaring bull market was short-sighted. By comparison, “rational exuberance” is something investors should strive for; it’s the excitement someone should feel if they have a strategy that they truly believe will help them reach goals in due time. If the market is making you giddy, you should know that feeling can’t last forever, but it’s okay to be in high spirits when your plans appear to be working.

ONE DOWN....

http://www.bloomberg.com/news/articles/2015-03-19/ex-moore-trader-rifat-gets-19-months-in-jail-for-insider-trading

Former Moore Capital trader Julian Rifat was sentenced to 19 months in jail by a London judge for insider trading following the biggest probe of its kind by British regulators. Rifat was fined 100,000 pounds ($147,300) and ordered to pay about 159,000 pounds in legal costs at the hearing on Thursday after pleading guilty in November to trading using illegal tips in companies including Barclays Plc, Volkswagen AG and Metro AG.

Judge Alistair McCreath said he must “have regard to the effect of this offense, this behavior, on confidence in the market” in determining the sentence. “Public confidence in the integrity of the market is plainly of the highest importance and insider dealing of this kind impacts adversely upon that,” McCreath added.

Rifat, 45, was arrested in March 2010, on his 41st birthday, and is one of the most high-profile people the U.K. Financial Conduct Authority has pursued. Rifat passed inside information to Graeme Shelley, a broker at London-based Novum Securities Ltd., who then traded for their joint benefit, according to the FCA. Profits from the transactions exceeded 285,000 pounds. The men were arrested in the U.K.’s largest insider-trading probe, dubbed Operation Tabernula. The investigation started after the Financial Services Authority -- as the regulator was then known -- stepped up its efforts to prosecute the offense in the wake of the financial crisis. Tabernula is Latin for “little tavern.” Shelley pleaded guilty in March 2014 and received a two-year suspended sentence. He also pleaded guilty to insider trading with former Legal & General Group Plc equities trader Paul Milsom, who was sentenced to two years in prison in 2013.

Rifat, once named in a list of “Institutional Investors That Matter,” held a “pivotal” role at Moore, making him privy to market sensitive information, the judge said, another factor he took into account in the sentencing. Rifat “exploited financial markets during a particularly challenging time just as they were taking steps to recover from the 2008 crisis,” Georgina Philippou, the FCA’s acting executive director of enforcement and market oversight, said in a statement Thursday. “The smooth running of our financial markets requires market professionals to play by the rules – Mr. Rifat knew the rules, but he abused them for his own benefit.”

http://www.reuters.com/article/2015/03/18/usa-housing-bailout-idUSL2N0WJ2L520150318

U.S. housing finance companies Fannie Mae and Freddie Mac could require more bailouts from U.S. taxpayers as risks are rising due to shrinking reserves, an internal watchdog for the firms' regulator said on Wednesday.

Washington bailed out the two firms in 2008 at the height of the financial crisis and has since seized all their quarterly profits while demanding the firms reduce their capital buffers.

"Future profitability is far from assured," Federal Housing Finance Agency Office of Inspector General said in a report, pointing out that the firms could again chalk up losses on their derivatives portfolios, similar to those they reported in the fourth quarter.

&quot This) increases the likelihood of additional Treasury investment," the report stated

.

Fannie Mae's chief executive issued the same warning in February when the firm announced it would make its smallest payment to taxpayers in more than four years...The possibility of another taxpayer draw raises pressure on the U.S. Congress to overhaul housing finance laws, although a real push on legislation is not expected anytime soon...Taxpayers pumped $116.1 billion into Fannie Mae following the U.S. housing market collapse, while Freddie Mac was propped up with $71.3 billion. Both firms have already paid in dividends more than they received in aid.

The government-run companies do not lend money directly, but underpin the U.S. housing market by guaranteeing most new mortgages in the country. Fannie Mae and Freddie Mac purchase loans from lenders and package them into securities that are then sold to investors.

http://qz.com/366494/the-us-almost-sued-google-in-2012-for-the-same-reasons-europe-is-now-investigating-the-search-giant/

The US government almost sued Google in 2012 over its anticompetitive tactics, including allegations it boosted the search rankings of its own properties over that of competitors. Ultimately, the Federal Trade Commission decided to close its investigation after the company—which attracts 64% of all search traffic in the US, according to comScore—agreed to alter some of its practices.

An FTC report, which was reviewed by the Wall Street Journal, focused on four major issues that the agency says “has resulted—and will result—in real harm to consumer and to innovation in the online search and advertising markets”:

• Ranking Google’s own properties above rivals: The FTC noted that Google “adopted a strategy of demoting, or refusing to display, links to certain vertical websites in highly commercial categories,” and instead favored its own properties.
  
  
• Threats to remove sites from its search results: Google reportedly scraped content illegally from sites including Yelp, TripAdvisor, and Amazon. When these companies complained, Google wielded its power, allegedly lobbing threats that it would remove their links from its search engine. Google now lets websites opt out, so their content is not included in special search results, without affecting their rankings.
  
  
• Restrictions on advertisers: The company reportedly did not let advertisers use data derived from Google ad campaigns to run ads on other sites. CEO Larry Page insisted on the limitations, according to the report, which noted the policy was changed in 2013 after discussions with the FTC.
  
  
• Restrictions on websites that publish search results: The report also said that Google imposed contract restrictions on websites that publish its search results from working with competing search engines, such as Microsoft and Yahoo.

Many of these themes have been raised before. In particular, the European Commission highlighted the first three issues in an ongoing, four-year antitrust probe into Google.

Quartz has reached out to the FTC and will update this post as warranted.
Update: Here is the full text of the statement Google issued about the report.

http://theconversation.com/explainer-what-makes-the-spring-equinox-31962

...The equinox is a midpoint. It’s around now that day and night become equal in length (but more about that later). It’s also around the equinox that the sun does what we think it always does – it rises due east and sets due west. And at the equinox the sun’s path sits mid-way between the extremes of summer and winter, as marked by the solstices.



A moment in time

But the equinox itself is a specific moment in time; Spring officially arrived at 6:45 p.m. EDT on Friday, March 20, 2015 IN NYC. To understand what this means, we must take a different view of the Earth and the sun, one where the Earth holds centre stage...Imagine for a moment that the Earth is at the centre of a sphere of stars, known as the celestial sphere. Of course, this isn’t physically correct but it’s a useful device. For example, it’s the basis of the equatorial coordinate system that maps the stars onto a fixed celestial grid in the same way that we use longitude and latitude to map the Earth.



On the celestial sphere, the north celestial pole is directly above the Earth’s north pole and the south celestial pole is directly below the Earth’s south pole. The celestial equator is the projection of the Earth’s equator out onto the celestial sphere. It splits the celestial sphere into a northern half and southern half. In this reference frame where the Earth is fixed, the sun appears to orbit the Earth. It follows a path known as the ecliptic, which tracks the sun’s motion against the background stars. Importantly, the ecliptic is tilted relative to the celestial equator. This is because the Earth spins on an axis that is titled by 23.5° relative to its orbital plane.

Having set this all up, it’s now possible to see the exact time of the equinox. It is the moment when the sun crosses the celestial equator. At the spring equinox the sun is heading NORTH of the celestial equator. While at the autumnal equinox the sun is heading SOUTH.



It’s all due to the tilt

We have such wonderful changing seasons on Earth because the Earth spins on a tilted axis. When the NORTH pole is tilted towards the sun, the sun’s path is high in the sky and it is summer. Six months later, when the NORTH pole is tilted away from the sun, the sun’s path is low and it is winter.



At the equinox neither the north pole or the south pole is tilted towards the sun – remember it’s the mid-point. This means that the Earth’s terminator or the line that separates day from night, runs from the north pole to the south pole. It’s the only time when the terminator aligns with the rotational axis of the Earth. This is captured brilliantly in the time-lapse video below which shows a whole year in just 12 seconds. The footage is from a geostationary satellite operated by the European Organisation for the Exploitation of Meteorological Satellites (EUMETSAT). The satellite has a constant view of Africa and it’s amazing to watch the terminator shift position as the Earth travels along its orbit around the sun.

https://www.youtube.com/feature=player_embedded

What makes an “equal night”?

The term equinox is derived from Latin and means “equal night”. But surprisingly, the day of the equinox is not actually the day when daylight hours match those of night. Instead, on the day of the equinox, it is the centre of the sun which is above the horizon for 12 hours...So if not at the equinox, when are day and night equal in length? It depends on the latitude of your location...At the equator, it doesn’t happen at all. There, the length of a day doesn’t vary much across the year. But due to the way we experience sunrise and sunset, a day at the equator is always around 14 minutes longer than the night.

NOTE: THIS POST IS FROM AUSTRALIA....HENCE SPRING IN SEPTEMBER, AUTUMN IN MARCH IN THE ILLUSTRATIONS....

The whole world's going mad, worse than ever before. I just hope it gets over it in my lifetime. I would hate to think this is the new normal.

http://www.nytimes.com/2015/03/20/opinion/paul-krugman-trillion-dollar-fraudsters.html?_r=0

By now it’s a Republican Party tradition: Every year the party produces a budget that allegedly slashes deficits, but which turns out to contain a trillion-dollar “magic asterisk” — a line that promises huge spending cuts and/or revenue increases, but without explaining where the money is supposed to come from. But the just-released budgets from the House and Senate majorities break new ground. Each contains not one but two trillion-dollar magic asterisks: one on spending, one on revenue. And that’s actually an understatement. If either budget were to become law, it would leave the federal government several trillion dollars deeper in debt than claimed, and that’s just in the first decade. You might be tempted to shrug this off, since these budgets will not, in fact, become law. Or you might say that this is what all politicians do. But it isn’t. The modern G.O.P.’s raw fiscal dishonesty is something new in American politics. And that’s telling us something important about what has happened to half of our political spectrum.

So, about those budgets: both claim drastic reductions in federal spending. Some of those spending reductions are specified: There would be savage cuts in food stamps, similarly savage cuts in Medicaid over and above reversing the recent expansion, and an end to Obamacare’s health insurance subsidies. Rough estimates suggest that either plan would roughly double the number of Americans without health insurance. But both also claim more than a trillion dollars in further cuts to mandatory spending, which would almost surely have to come out of Medicare or Social Security. What form would these further cuts take? We get no hint. Meanwhile, both budgets call for repeal of the Affordable Care Act, including the taxes that pay for the insurance subsidies. That’s $1 trillion of revenue. Yet both claim to have no effect on tax receipts; somehow, the federal government is supposed to make up for the lost Obamacare revenue. How, exactly? We are, again, given no hint. And there’s more: The budgets also claim large reductions in spending on other programs. How would these be achieved? You know the answer.

It’s very important to realize that this isn’t normal political behavior. The George W. Bush administration was no slouch when it came to deceptive presentation of tax plans, but it was never this blatant. And the Obama administration has been remarkably scrupulous in its fiscal pronouncements....O.K., I can already hear the snickering, but it’s the simple truth. Remember all the ridicule heaped on the spending projections in the Affordable Care Act? Actual spending is coming in well below expectations, and the Congressional Budget Office has marked its forecast for the next decade down by 20 percent. Remember the jeering when President Obama declared that he would cut the deficit in half by the end of his first term? Well, a sluggish economy delayed things, but only by a year. The deficit in calendar 2013 was less than half its 2009 level, and it has continued to fall.

So, no, outrageous fiscal mendacity is neither historically normal nor bipartisan. It’s a modern Republican thing. And the question we should ask is why. One answer you sometimes hear is that what Republicans really believe is that tax cuts for the rich would generate a huge boom and a surge in revenue, but they’re afraid that the public won’t find such claims credible. So magic asterisks are really stand-ins for their belief in the magic of supply-side economics, a belief that remains intact even though proponents in that doctrine have been wrong about everything for decades...But I’m partial to a more cynical explanation. Think about what these budgets would do if you ignore the mysterious trillions in unspecified spending cuts and revenue enhancements. What you’re left with is huge transfers of income from the poor and the working class, who would see severe benefit cuts, to the rich, who would see big tax cuts. And the simplest way to understand these budgets is surely to suppose that they are intended to do what they would, in fact, actually do: make the rich richer and ordinary families poorer. But this is, of course, not a policy direction the public would support if it were clearly explained. So the budgets must be sold as courageous efforts to eliminate deficits and pay down debt — which means that they must include trillions in imaginary, unexplained savings. Does this mean that all those politicians declaiming about the evils of budget deficits and their determination to end the scourge of debt were never sincere? Yes, it does. Look, I know that it’s hard to keep up the outrage after so many years of fiscal fraudulence. But please try. We’re looking at an enormous, destructive con job, and you should be very, very angry.

... Beijing has played a key role in launching initiatives such as new development bank (NDB) and the new Silk Road Fund, which are designed to increase infrastructure financing for developing countries. But while the AIIB is just one of these initiatives, it seems to be rapidly gaining global traction. More than 30 countries have already announced their intention to join the China-led development bank as founding members, including some of Europe's largest economies.

On Tuesday, March 17, France, Germany and Italy stated they would follow Great Britain's lead and join the proposed institution despite skepticism from Washington, which has voiced concerns over looser lending standards as well as environmental and social safeguards. South Korea, Switzerland and Luxembourg were also considering joining, according to China's official Xinhua news agency...

... Analysts argue that while these nations have their own differing explanations for joining the AIIB, they all believe that the possible benefits from a stronger relationship with China, the world's second-largest economy, outweigh whatever perceived negatives such a decision entails.

For instance, Margot Schüller, a senior research fellow at the Germany-based GIGA Institute of Asian Studies, points out that all of these European countries have not only strong economic ties with China and other Asian countries, but also long-term experiences in development finance which they offer to the new regional development bank. So given the huge unmet demand for power, transportation, water and communication, European companies will also be eager to join in the construction of modern infrastructure in Asia...

... Nicola Casarini, a senior fellow for Asia at the Rome-based Istituto Affari Internazionali, argues that China has not hidden its intention to challenge the Western-dominated financial system. "The AIIB could indeed become a rival to USD-based Western institutions such as the World Bank," he said, adding however, that this would depend on the evolution of China-US relations in the coming years...

... However, the most interesting aspect probably comes down to how much pressure Beijing will be facing in terms of handling its new "multilateral" profile. "China was probably not really prepared for the high public attention and the difficulties of becoming a creator of new multilateral frameworks," said Huotari, adding that inside China intense debates were taking place over how these new financing instruments should be used to maximize Chinese interests and how they fit into China's foreign policy and economic agenda...

/More... http://www.dw.de/why-europe-defies-the-us-to-join-a-china-led-bank/a-18322773

(I was beginning to think it was me, something I said)


Yeah, the USA is toast. All the groaning, massive financial infrastructure (prisons) of the New World Order will be ashes and dust in another Presidential term. And Obama and his predecessor W (and their Rubin-spawned technocrats) will be more responsible than most for its destruction. Such a sweet irony!

The wallpaper is peeling off faster than they can paste it up.

Besides, I'm reaching the big 6-0 next month. My days for "optimism" are over.

... So of course, these four pillars of power of the world before have never screamed as loudly as now. And the ear-splitting grating of these blunt tools creates real dangers:

. As regards the media, whilst displaying real attempts at reinvention, the temptation exists to ideologize even more, even permitting itself to counter the very official propaganda of the Russian media machine, for example(11).

. the banks, financial markets, statistics, the size of fines and profits, and especially the increasingly improbable increases in stock prices, fill the pages of the financial media and minds hypnotized by the chasm that separates these astronomical sums from economic reality; but the power which these staggering numbers give authorizes the banking and financial system to lay down its law to the central banks and governments for a while yet.

. the oil price collapse puts the oil producing powers at bay even more at the centre and with a real pressing need for reorganization: Saudi Arabia at the forefront, trying to grab the region through its daesh Islamic armies spreading Wahhabism in the Middle East(12).

. as for NATO, it attempted a military coup on Europe in 2014 taking advantage of an inept management of the EU’s neighbourhood relations. The fact is that it isn’t easy to ask for the wallet of the person who holds the gun… The Western military-industrial complex’s strategy is simple and perfectly logical therefore: capitalize on, or even create conflicts to make itself indispensable and able to maintain/increase its budgets.

Thus the considerable weakening of the tools of power which remained the prerogative of a sick world before, still runs significant risks for the planet for some time to come, namely: risks of war (oil, NATO), risks of a Western camp confining itself ideologically (media), risks of economic collapse (financial markets)…

/... http://geab.eu/en/2015-media-finance-oil-system-military-industrial-complex-qe-the-narratives-war-2/

(11). Our teams have seen a hysteria about the alleged media war between the West and Russia, which seems to allow the use of propaganda speeches to balance the forces present. Media like Ukraine Today, for example, was created in the Ukrainian Western camp with the official objective of producing counter-propaganda (which is propaganda, of course). It’s interesting to read what the BBC has to say on these issues.(03/03/2015)

(12). Source : New Statesman, 27/11/2014

GEAB - Global Europe Anticipation Bulletin

"The GEAB’s mission since January 2006 is precisely this: helping its readers to look beyond the obvious and the dominant noise and try to get closer to the reality of profound changes."

MAYBE BECAUSE WE HAVEN'T HAD ANY? WHO WRITES THESE HEADLINES, ANYWAY?



http://www.bloomberg.com/news/articles/2015-03-20/wages-haven-t-been-this-crucial-to-u-s-economy-in-half-century


When it comes to U.S. economic growth, wages may never have been this important.

The link between earnings and consumer spending has been tighter in this expansion than in any other since records began in the 1960s, according to calculations by Tom Porcelli, chief U.S. economist at RBC Capital Markets LLC in New York.

Wages have become even more critical as households, still shaken after being caught with too much debt when the recession hit, remain unwilling or unable to tap home equity or let credit-card balances balloon to buy that new television or dishwasher. By not overextending themselves again, Americans are only spending as much as their incomes will allow, meaning that 70 percent of the economy is riding on how fast pay rises.

“In an environment where credit is not being used in a material way, the fate of wages matters,” Porcelli said. “They’re doing all of the driving from a consumption perspective.”

FOOL ME ONCE, SHAME ON ME...NOT GONNA GET FOOLED AGAIN!

http://www.theautomaticearth.com/2015/03/debt-rattle-march-21-2015/

A few weeks back we commented on the rather disturbing news that repeat foreclosures jumped in January:



Here’s what the trend looks like:

Now, a new report from Zillow seems to offer further evidence that the US housing market may not be the picture of health after all (as if we needed more proof after housing starts cratered 17% in February). The percentage of homeowners underwater in the US was flat from Q3 to Q4 which doesn’t sound all that terrible until you consider that this figure had fallen for 10 consecutive quarters. Things look particularly bad in Florida and the midwest where Zillow notes more than 25% of borrowers are sitting in a negative equity position. Here’s more:




Click on the image for interactive version AT LINK: http://www.zillow.com/research/negative-equity-2014-q4-9223/

Zillow goes on to note that we have entered a new era in the US housing market: the era of the underwater homeowner. Even better, the report goes on to note that in a number of cases, borrowers will likely be “in negative equity forever”:



The good news (and this seems to synch with what we saw in the latest UMich Consumer Sentiment print), is that rich people are doing ok:



Now it’s starting to make sense to us why we were having trouble understanding the notion that a “recovery” was well underway in the US. It’s because we didn’t understand that a recovery was usually characterized by an epochal shift towards deeply underwater homeowners and where negative equity becomes a permanent fixture in the market.

HE FORGOT THIS:

Legal Experts: Greece Has Grounds for WWII Reparations

http://greece.greekreporter.com/2015/03/19/legal-experts-greece-has-grounds-for-wwii-reparations/

A growing number of legal experts are supporting Greece’s demands over the German war reparations from the country’s brutal Nazi occupation during World War II. Despite the official German refusal to address the issue, legal experts say now Athens has ground for the case. The hot issue is expected to be brought up by Greece’s newly elected Prime Minister Alexis Tsipras during his official visit to Berlin on Monday, where he is scheduled to hold a meeting with the German Chancellor Angela Merkel.

The tension between the two countries have recently rose to unexpected levels and a series of events with the Finance Ministers of Greece and Germany, Yanis Varoufakis and Wolfgang Schaeuble respectively, and the war reparations issue — mainly by the Greek side — has significantly affected the already negative climate. The Greek leftist-led coalition government has repeatedly raised the issue causing Germany’s firm reaction as expressed by German Finance Minister Wolfgang Schaeuble, who recently warned Athens to forget the war reparations, underlining that the issue has been settled decades ago. Central to Germany’s argument is that 115 million deutschemarks have been paid to Greece in the 1960s, while similar deals were made with other European countries that suffered a Nazi occupation.

At the same time, though, lawyers from Germany and other countries have said the issue is not wrapped up, as Germany never agreed a universal deal to clear up reparations after its unconditional surrender. The German answer on that is that in 1990, before its reunification, the “Two plus Four Treaty” agreement was signed with the United Kingdom, the United States, the former Soviet Union and France, which renounced all future claims. According to Berlin, this agreement settles the issue for other states too.

“The German government’s argument is thin and contestable. It is not permissible to agree to a treaty at the expense of a third party, in this case Greece,” international law specialist Andreas Fischer-Lescano said, as cited by the Reuters. Mr. Lescano’s opinion finds several other experts in agreement. One of them, the Greek lawyer Anestis Nessou, who works in Germany highlighted that “there is a lot of room for interpretation. Greece was not asked, so the claims have not gone away.”

Parallel to the above, another separate and still open issue regards the forced occupation loan taken from the Bank of Greece (BoG) in 1942, in order to fund the Nazis military campaign in northern Africa. The official German position is yet again the same: This is already covered. “The view of the German government is embarrassing. The Nazi regime even calculated how high the repayments should be on the loan,” historian Hagen Fleischer told Germany’s ARD television. What the experts say is that Greece could take the forced Nazi occupation loan to an international court, while increasing voice in support of the Greek demands are also heard in the Bundestag, the country’s federal Parliament. “It is about recognizing the fact that we committed a serious injustice in Greece,” the chairwoman of the Social Democratic Party (SPD) Values Committee, Gesine Schwan, told Der Spiegel last week.

http://rt.com/business/242641-eu-greece-unused-funds/

The European Commission has made $2 billion of unused funds available to Greece to help the country avert a cash crunch, EC head Jean-Claude Juncker says. The offer was made a day after crisis talks between Greece's new Prime Minister Alexis Tsipras and European leaders on Greece's EU-IMF bailout.

Greek authorities said on Friday they were gradually moving towards meeting the requirements of international creditors on a more detailed reform plan, after Prime Minister Tsipras said his coalition would intensify work to avert the country’s bankruptcy. Austerity policies have been the focus of a standoff between Greece and its troika of creditors. Promises to end the era of drastic cuts helped Tsipras win power two months ago, but since then his stance has weakened. Greece’s western creditors have been insisting the country needs to reform its economy and start cutting its own expenses, if it wants to get new money for its ailing economy.

The Troika of creditors said in February they were ready to extend the current bailout program until June 2015, but a general agreement hasn’t been reached yet. Tsipras has sharply criticized the Troika methods calling them arm-twisting. He blames them for his country’s unprecedented recession.

Greece received two bailouts from the EU in 2010 and 2014 totaling €240 billion. Having taken on austerity measures, Greece saw its economy losing a quarter of its value, with a third of Greeks living below the poverty line and unemployment exceeding 30 percent.

Experts say the money Greece has now will only last till the end of March.

http://rt.com/business/242489-bank-greece-donation-account/

Cash-strapped Greece has maybe given up hope that the EU will solve its financial woes, and is seeking direct handouts from benevolent donors via its central bank website.

The bank set up an account called ‘Solidarity Account for Repayment of Public Debt’, which has been open for contributions since March 5. The account will accept “voluntary deposits, to be used exclusively for the repayment of Greece’s public debt" according to the bank's website.

DONATE AT http://t.co/6vkBzYanJd

MORE AT LINK

http://yanisvaroufakis.eu/2015/03/20/of-greeks-and-germans-re-imagining-our-shared-future/

HOW MANY MINISTERS OF FINANCE, OR ANYTHING ELSE, FOR THAT MATTER, HAVE THEIR OWN BLOG SITE? GO READ!

http://www.zerohedge.com/news/2015-03-19/central-banks-will-not-be-able-control

The biggest issue facing the financial system today is the US Dollar rally. The Fed and other Central Banks are trying to maintain the illusion that they have everything under control by talking about interest rates, but the reality is that the US Dollar carry trade is ABOVE $9 trillion in size. That is almost as big as ALL of the money printing that occurred between 2009 and 2013. And it's imploding as we write this. Globally, the world is awash in borrowed money… most of it in US Dollars. The US Dollar carry trade is north of $9 trillion… literally more than the economies of Germany and Japan COMBINED.

When you BORROW in US Dollars you are effectively SHORTING the US Dollar. So when the US Dollar rallies… you have to cover your SHORT or you blow up. And the US Dollar has been rallying… HARD. Indeed, the move that began in July 2014 is already larger on par in scope than that which occurred during the 2008 meltdown.



Moreover, this move has occurred with little to no rest. The US Dollar barely corrected 2% after rallying a stunning 16+% in a matter of months before beginning its next leg up.



You only get these sorts of moves when the stuff hits the fan. CNBC and the others are babbling about the Fed’s FOMC changes, but all of that is just a distraction from the fact that a $9+ trillion carry trade, arguably the largest carry trade in history, has begun to blow up. Rate hikes, QE, all of this stuff is minor in comparison to the carnage the US Dollar is having on the financial system. Take a look at the impact it’s having on emerging market currencies:

Here are the monthly charts for the USD/ Aussie (black line), USD/ Brazilian Real (blue line), USD/South African Rand (red line), and USD/ Mexican Peso (green line) pairs. The carnage over the last six months has been extreme with double digit moves across the board.



The US Dollar took down Oil, commodities, even emerging market currencies. Stocks will be next. The first REAL sign that the 2008 Crash was coming occurred when the US Dollar began to skyrocket in the summer of 2008.

http://www.reuters.com/article/2015/03/20/ukraine-bond-idUSL6N0WM1ER20150320

The Republic of Ukraine has sent out a request for proposals (RFP) to banks for a new US government-guaranteed bond, according to three sources. This is the second time the US government has thrown its financial backing behind a Ukrainian international bond issue. In May 2014, the US guaranteed a US$1bn Ukrainian bond maturing in 2019 through the US Agency for International Development (USAID).

That bond was given a credit rating in line with the US sovereign at Aaa by Moody's, AA+ by Standard & Poor's and AAA by Fitch. This is a far cry from Ukraine's credit rating, which stands at Caa3, CCC and CC with the same three agencies.

The RFP comes just over a week after Ukraine agreed a new four-year US$17.5bn bailout facility with the International Monetary Fund. As part of the IMF agreement several institutions - including the European Union, World Bank and US - have agreed to provide around US$7.5bn between them, according to analyst estimates, to the war torn country.

It is not clear whether the US-backed bond forms part of the US contribution.

Meanwhile, Ukraine is obligated under the IMF agreement to restructure at least US$15.3bn of outstanding debt. Ukraine's finance minister Natalia Yaresko confirmed during an investor call last week that bondholders will see haircuts to principal, as well as maturity extensions and changes to interest payment.

Russia, which holds US$3bn of Ukrainian debt that comes due in December this year, will not be exempt from the cuts, Yaresko said.

A clause in the debt owed to Russia allows it to accelerate bond payments if Ukraine's debt-to-GDP ratio breaches 60% - a number that has been passed largely because Ukraine's industrial power centre Donbass has ground to a halt under sustained conflict. Russia has repeatedly said that it would not accelerate the debt.

WHY ISN'T THIS A PUBLIC (AS IN, KNOWN BY THE PUBLIC) SCANDAL?

It's true. People here at DU have told me so!

And, no matter what Yaresko says, parties involved have to agree to such cuts. And if Russia doesn't agree, a few others are likely to hold out too.

You broke it--you bought it! Or at least, you pay for it.

http://www.theautomaticearth.com/2015/03/theres-brussels-and-then-theres-real-people/

Once again, a look at Greece and the Troika, because it amuses me, it angers me, and also because it warms my cockles, in an entirely metaphorical sort of way. The Troika members love to make it appear (and everyone swallows it whole) as if in their ‘negotiations’ with Greece all sorts of things are cast in stone and have no flexibility at all. Humbug.

First, another great piece by Rob Parenteau (via Yves Smith), who lays it out in terms so simple they can’t but hit the issue square on the nose. For Europe and the Troika, there’s Greece, and then there’s the rest. No money for the Greeks lining up at soup kitchens (not even for the soup kitchens themselves), but $60 billion a month for the bond market. The $200 million anti-poverty law – a measly sum in comparison – that Athens voted in this week is a no-no because Greek government has to ask permission for everything in Brussels first, says Brussels, no matter that that only prolongs the suffering. It’s not about money, in other words, it’s about power, and the Greeks must be subdued.

Both the financial and the political press have by now perfected their picture of Yanis Varoufakis as a combination of some kind of incompetent blunderer on the one hand, and a threat the size of Vladimir Putin on the other, while the rudeness of German FinMin Schäuble is not discussed at all. The media are no longer capable of reporting anything outside of their propaganda models. The ‘middle finger’ video turns out to be a fake, but who cares, it’s done its damage. Parenteau:



Some are more equal than others, in other words. That is true also of Ukraine, which gets to issue bonds guaranteed by the American taxpayer. If Greece could do that, they‘d have a way out of the dark pit austerity has thrown it in. And Greece isn’t even killing its own people…. But then Kiev doesn’t need to be subdued, it’s already being ruled exclusively by US stooges.

What, Again? The ink hasn't even dried on the IMF loan and guess who needs more money? (Besides me)!

Ukraine needs more bailout financing than currently promised to help jump-start the embattled nation’s economy, Finance Minister Natalie Jaresko said Monday in an interview with The Wall Street Journal.

"The package that we have is going to stabilize the financial banking system, but it’s not enough to seriously restart growth and promote growth," Jaresko said after meetings with U.S. Treasury Secretary Jacob Lew.

The newspaper said that in meetings with senior U.S. Treasury, State Department and White House officials and lawmakers, Jaresko this week is making the case that backing Ukraine will pay geopolitical dividends.

"If, for whatever reason, one of our partners is not willing to come up with, or not able to come up with defensive military support, then provide us with financial support," Jaresko said.

But aside from promising to guarantee $2 billion of new Ukraine debt and working with the World Bank, Europe and other international lenders to provide support, U.S. officials haven’t indicated they are prepared to cough up any more cash, the newspaper said.

"Right now the coalition seems to be unified," the finance minister said.

Complete story at - http://en.interfax.com.ua/news/economic/255503.html

Good morning, Matt! How's the weather, and every little thing? Our warm sunny weekend has been canceled, but at least it's not snowing.

There's too much news--and I'm hungry. Breakfast!

2:20 PM, 11C, that's about 50ish.

Spring definitely came early here this year and the junta is taking advantage. We've heard they've already cut off heat to parts of Kiev. The normal off day for heat is April 15, if I remember correctly.

A little something to mark the first part of the theme.

The visuals on this would have fit last week's theme perfectly too!

but it's all of 45F (7 C), perfect pneumonia weather with dampness, stiff breeze and no sun. And it's into the 20's every night....

and the Kid is sneezing her head off, I have to go make chicken soup. (before I succumb to her germs)


We went to see the Claymation film "Book of Life" Ugh. If I were Mexican, I'd be insulted. I hadn't slept through a movie in over a year, but this one I missed the first third or so. It was free, though ( the theater does that). The Kid was happy....and that means I get some peace for the weekend.

Good band, too. I hadn't ever heard of them, but I seldom leave the 19th century...except for the 18th.

Remember when the infamous Goldman Sachs delivered a thinly-veiled threat to the Greek Parliament in December, warning them to elect a pro-austerity prime minister or risk having central bank liquidity cut off to their banks? (See January 6th post here.) It seems the European Central Bank (headed by Mario Draghi, former managing director of Goldman Sachs International) has now made good on the threat.

The week after the leftwing Syriza candidate Alexis Tsipras was sworn in as prime minister, the ECB announced that it would no longer accept Greek government bonds and government-guaranteed debts as collateral for central bank loans to Greek banks. The banks were reduced to getting their central bank liquidity through “Emergency Liquidity Assistance” (ELA), which is at high interest rates and can also be terminated by the ECB at will.

In an interview reported in the German magazine Der Spiegel on March 6th, Alexis Tsipras said that the ECB was “holding a noose around Greece’s neck.” If the ECB continued its hardball tactics, he warned, “it will be back to the thriller we saw before February” (referring to the market turmoil accompanying negotiations before a four-month bailout extension was finally agreed to).

The noose around Greece’s neck is this: the ECB will not accept Greek bonds as collateral for the central bank liquidity all banks need, until the new Syriza government accepts the very stringent austerity program imposed by the troika (the EU Commission, ECB and IMF). That means selling off public assets (including ports, airports, electric and petroleum companies), slashing salaries and pensions, drastically increasing taxes and dismantling social services, while creating special funds to save the banking system.

These are the mafia-like extortion tactics by which entire economies are yoked into paying off debts to foreign banks – debts that must be paid with the labor, assets and patrimony of people who had nothing to do with incurring them.

Complete story at - http://www.alternet.org/economy/how-enslave-country-megabank-few-easy-steps

Because if the PTB think they will be allowed to conduct economic warfare on nations and classes and races, they are sadly ignorant of history and people.

"Springtime for Hitler" from "The Producers"

"Dr. Who" fans may recognize John Barrowman (Captain Jack).

Thanks antigop!

Taxman by The Beatles (written by George)

&spfreload=10

I'm doing okay, just too dern busy these days, and I'm not even sure why...

I'm probably wrong, but did I see you may be closing in on 60? I hit that milestone this year myself. Crazy....

Anyway, thanks for remembering me. And thanks! for doing what you do for the WEE.



back to the House of Cards, better known as our economy.

It's the craziness that bothers me the most. And the House of Cards, that's very disturbing. Glad to know you are all right. Don't be a stranger, now!

http://davidstockmanscontracorner.com/cmon-angela-let-them-greexit/

...When the euro and EU eventually implode it will rattle the bones of every gambler and algo left in the casinos anywhere on the planet. Yes, the school yard name calling and roughhousing now going on in Europe makes it appear that behind the sturm und drang there is some negotiations happening. But the truth is there is nothing to negotiate. Greece is so completely and terminally bankrupt that there is no solution other than default and greexit. To insist that Greece service the entirety of its staggering $350 billion of debt, as does Germany and the troika apparatchiks, is to advocate the extinguishment of democracy in Greece and its reduction to a colonial mandate of Brussels; and in the process, to eliminate any semblance of economic life among the debt serfs who would inhabit it.

Its just math. Sooner or later interest rates must normalize. For a country with Greece’s profligate fiscal history, there is no possibility that the interest carry cost on a public debt load equal to 175% of GDP could be any less than 6-7% in the absence of EU guarantees.That means that the Greek state’s annual interest bill would approach 10% of GDP before paying down a single dime of principal. You can’t govern a democracy when one-quarter of revenues are preempted for debt service. That’s especially the case given the sprawling expanse of the Greek state and the vast dependency of its population on public jobs, pensions and other welfare state entitlements. Indeed, for all the protestations about “austerity” Greece spending ratio to GDP just keeps getting worse. SEE CHART AT LINK

So what Greece’s fiscal equation amounts to is a deathly political food fight over upwards of 60% of GDP which must be funded with nearly an equivalent tax claim on current income—–since Greece has no credit in any known financial market absent EMU advances and guarantees. Throw in the diversion of a substantial share of the punishing taxes needed to finance the current commitments of the Greek state to lenders and coupon clippers and you have a non-starter. But try to manage that impossible equation by the writ of remote bureaucrats and non-Greek politicians and you get the clowns of Syriza now, and an uprising in the streets eventually. So the entire predicate of the current so-called negotiations—–that Greece can fashion, enact and adhere to a fiscal plan that actually adds up and that is acceptable to the “institutions”—–is sheer madness; its recipe for an unending gong show which would pale what has gone before into insignificance.

So why do the Brussels bureaucrats and the German politicians insist? At the end of the day, its not really the fact that Germany is on the hook for upwards of $70 billion of guarantees and bilateral loans. Paying up would undoubtedly elicit a political firestorm in Germany, but it would not be a financial calamity. Even a 100% loss would amount to less than 2% of GDP. No, the reason that Germany persists, notwithstanding the outright political calumny being directed its way by its Greek supplicants, is that its leader, Angela Merkel, an otherwise sober, conservative and upright politician, believes that Europe will stand or fall on the euro. As she said yesterday in laying the ground work for an eventual new round of kick the can with Tsipras,

“If the euro fails, Europe fails,” Merkel told German lawmakers in Berlin Thursday. “The eyes of the world are looking at how we deal with problems and crises in individual countries of the euro zone. The euro is more than a currency.”

What a historic tragedy. The Euro and the ECB is not the health and future of Europe; it is a massive financial calamity waiting to happen. The fact is, the Bundesbanks’s sound money standard has now been irrevocably stolen and perverted by the socialist politicians and self-perpetuating apparatchiks of Brussels. There could be no more powerful evidence for that proposition than the antics of the foolish pretender who now runs the ECB. The last thing that Europe’s profligate welfare state governments need is negative interest rates and a massive monetization of their gargantuan public debts. Yet Draghi apparently believes that by destroying what remains of price discovery in Europe’s financial markets and by eliminating the only real incentive for fiscal sobriety that remains—–the fear of soaring interest rates on the public debt—-he is leading Europe toward economic recovery. In fact, he is leading Europe down a path of sheer monetary and financial madness.

This baleful scenario, of course, is the last thing Merkel would want, as well, if she had a clue about monetary policy and central banking. But the euro has apparently become a magic totem in her mind and that of the German leadership. So Germany stumbles forward pushing the entire project toward an eventual financial and political crash landing. There is really nothing to stop the blind momentum—-not in France or the other financial cripples of the EMU which remain fiscally viable only due to the money printing campaign of the ECB. So unless Angela Merkel comes to her senses, the true crisis will go unrecognized and unattended.

To wit, the real threat to the peace and prosperity of Europe is not the middling harm that would result from sending the Greeks packing—-back to their Drachma and the massive task of reconstituting their international credit and fiscal self-governance. No, the enemy of Europe is actually the euro itself. It’s not “more than a currency”; it’s the pernicious emission of a central bank that has fallen prey to the statist and Keynesian illusion that nations can print their way to prosperity. Worse still, that this can be accomplished among a bickering confederation of welfare states with declining populations, shrinking work forces, punitive levels of taxation and state intervention and debts which are already at the breaking point.

C’mon Angela. Let the greexit happen. That’s the least of Europe’s problems.

A tax haven is a state, country or territory where, on a national level, certain taxes are levied at a low rate or not at all.

It also refers to countries which have a system of financial secrecy in place. It should be noted that, financial secrecy can be used by foreign individuals to circumvent certain taxes (such as inheritance tax on money, and income tax of the interest on the money you have on your bank account). Due to the fact that the requirement of paying taxes on these funds can not be transmitted, as the funds themselves are invisible to the country the individual is from, such taxes can be avoided.

Earnings from income generated from real estate (i.e. by renting houses you own abroad) can also be eliminated this way. Despite this occasional abuse, the countries themselves stand in their right to have a system of financial secrecy in place, and it is up to the individual to fill in the required paperwork (i.e. double taxation forms). If the proper double taxation forms are filled in, and taxes are paid, companies can avoid much taxes, even if they hence pay their taxes legally.

This is because the tax rates on income can be much lower than the tax rate in their own country. It should be noted that some taxes (such as inheritance tax on the real estate, VAT on the initial purchase price of the real estate -aka Transfer tax-, annual immovable property taxes, municipal real estate taxes, ...) can not be avoided or reduced, as these are levied by the country the real estate you own is in, and hence need to be paid just the same as any other resident of that country. The only thing that can be done is picking a country that has the smallest rates on these taxes (or even no such taxes at all) before you buy any real estate.

Individuals or corporate entities can find it attractive to establish shell subsidiaries or move themselves to areas with reduced or nil taxation levels relative to typical international taxation. This creates a situation of tax competition among governments.

Different jurisdictions tend to be havens for different types of taxes, and for different categories of people or companies. States that are sovereign or self-governing under international law have theoretically unlimited powers to enact tax laws affecting their territories, unless limited by previous international treaties.

There are several definitions of tax havens. The Economist has tentatively adopted the description by Geoffrey Colin Powell (former economic adviser to Jersey): "What ... identifies an area as a tax haven is the existence of a composite tax structure established deliberately to take advantage of, and exploit, a worldwide demand for opportunities to engage in tax avoidance."

The Economist points out that this definition would still exclude a number of jurisdictions traditionally thought of as tax havens. Similarly, others have suggested that any country which modifies its tax laws to attract foreign capital could be considered a tax haven.

According to other definitions, the central feature of a haven is that its laws and other measures can be used to evade or avoid the tax laws or regulations of other jurisdictions.

In its December 2008 report on the use of tax havens by American corporations, the U.S. Government Accountability Office was unable to find a satisfactory definition of a tax haven but regarded the following characteristics as indicative of it: nil or nominal taxes; lack of effective exchange of tax information with foreign tax authorities; lack of transparency in the operation of legislative, legal or administrative provisions; no requirement for a substantive local presence; and self-promotion as an offshore financial center.

A 2012 report from the Tax Justice Network estimated that between USD $21 trillion and $32 trillion is sheltered from taxes in unreported tax havens worldwide. If such wealth earns 3% annually and such capital gains were taxed at 30%, it would generate between $190 billion and $280 billion in tax revenues, more than any other tax shelter.

If such hidden offshore assets are considered, many countries with governments nominally in debt are shown to be net creditor nations. However, despite being widely quoted, the methodology used in the calculations has been questioned, and the tax policy director of the Chartered Institute of Taxation also expressed skepticism over the accuracy of the figures.

Another recent study estimated the amount of global offshore wealth at the smaller - but still sizeable - figure of US$7.6 trillion. A study of 60 large US companies found that they deposited $166 billion in offshore accounts during 2012, sheltering over 40% of their profits from U.S. taxes.

1. Nil or only nominal taxes. Tax havens impose nil or only nominal taxes (generally or in special circumstances) and offer themselves, or are perceived to offer themselves, as a place to be used by non-residents to escape high taxes in their country of residence.
   
   
2. Protection of personal financial information. Tax havens typically have laws or administrative practices under which businesses and individuals can benefit from strict rules and other protections against scrutiny by foreign tax authorities. This prevents the transmittance of information about taxpayers who are benefiting from the low tax jurisdiction.
   
   
3. Lack of transparency. A lack of transparency in the operation of the legislative, legal or administrative provisions is another factor used to identify tax havens. The OECD is concerned that laws should be applied openly and consistently, and that information needed by foreign tax authorities to determine a taxpayer’s situation is available. Lack of transparency in one country can make it difficult, if not impossible, for other tax authorities to apply their laws effectively. ‘Secret rulings’, negotiated tax rates, or other practices that fail to apply the law openly and consistently are examples of a lack of transparency. Limited regulatory supervision or a government’s lack of legal access to financial records are contributing factors.

However, the OECD found that its definition caught certain aspects of its members' tax systems (some countries have low or zero taxes and ring fencing for certain favored groups). Its later work has therefore focused on the single aspect of information exchange. This is generally thought to be an inadequate definition of a tax haven, but is politically expedient, because it includes the small tax havens (with little power in the international political arena) but exempts the powerful countries with tax haven aspects such as the USA and UK.

In deciding whether or not a jurisdiction is a tax haven, the first factor to look at is whether there are no or nominal taxes. If this is the case, the other two factors – whether or not there is an exchange of information and transparency – must be analyzed. Having no or nominal taxes is not sufficient, by itself, to characterize a jurisdiction as a tax haven. The OECD recognizes that every jurisdiction has a right to determine whether to impose direct taxes and, if so, to determine the appropriate tax rate.

Three types of tax haven types form a Dutch Sandwich:

1. Primary tax havens: the location where financial capital winds up. Subsidiary shell companies there have obtained rights to collect profits from corporate intellectual property (IP) by transfers from their parent.
   
   
2. Semi-tax havens: locations that produce goods for sale primarily outside of their territorial boundaries and have flexible regulations to encourage job growth, such as free trade zones, territorial-only taxation, and similar inducements.
   
   
3. Conduit tax havens: locations where income from sales, primarily made outside their boundaries, is collected, and then distributed. Semi-tax havens are reimbursed for actual product costs, perhaps with a commodity markup. The remaining profits are transferred to the primary tax haven, because it holds rights to profits due to the corporate IP. By matching outflow to income they do not retain capital and their role, while crucial, remains invisible.

Large multinational corporations may have dozen of such tax haven entities interacting with each other. Each haven can claim that it does not satisfy definitions that attempt to place all tax havens into a single class. Even increased transparency does not change the effectiveness of corporate tax avoidance.

If corporations and the wealthy elites had paid their share of taxes, this country would be in much better condition.

When It's Springtime In Alaska (It's Forty Below) by Johnny Horton:

&spfreload=10

IT'S NOT EASY TO READ, BUT IT'S THOUGHT-PROVOKING AND GIVES INSIGHT INTO WHAT CENTRAL BANKERS ARE THINKING (OR NOT THINKING).

https://www.creditwritedowns.com/2015/03/currency-wars-the-swiss-franc-policy-divergence-and-fed-rate-hikes.html

PUTS ME IN THE MOOD FOR THIS:

https://www.youtube.com/watch?annotation_id=annotation_758004&feature=iv&src_vid=EjMNNpIksaI&v=JG5OsfOuEy0

Free speech does not arise out of commitment to principle, or out of some newspaper’s editorial policy; it arises out competing sources of information and opinion.

&feature=channel_page

Speaking of the Monopoly game, there is a segment in NPR that the game was originally designed by a woman!

3/3/15
The true story of Monopoly begins a few decades before Charles Darrow rolled the dice, with a Washington, D.C., woman named Lizzie Magie. In 1904, Magie patented something called the Landlord's Game, which was, in some great irony, an argument against the concentration of wealth. Her game spread around the country, including to the Quakers of Atlantic City, N.J., who added all their city's street names (Atlantic Avenue, Kentucky Avenue, Park Place). Darrow got his hands on the game through a Quaker friend — and then sold it to Parker Bros. as his own.

Lizzie Magie was a pretty astonishing woman. She was an outspoken feminist, she had acted, she had done some performing, she had written some poetry and she was a game designer. And at the time that she patented her game, it was before women had the right to vote. And I was very surprised: I thought, you know, female game designers, they're getting more traction today but it's still unusual. And at the time she put her patent application in, fewer than 1 percent of patents in the United States came from women.

more...
audio appx 7.5 minutes
http://www.npr.org/2015/03/03/382662772/ever-cheat-at-monopoly-so-did-its-creator-he-stole-the-idea-from-a-woman

The Lost Female Genius Behind Monopoly by Mary Pilon
Included are large drawings of the original Landlord's game as created by Lizzie Magie

https://medium.com/genius-week/the-lost-female-genius-behind-monopoly-62e588c56ab3


The Monopolists: Obsession, Fury, and the Scandal Behind the World's Favorite Board Game
http://www.amazon.com/The-Monopolists-Obsession-Americas-Favorite/dp/1608199630/ref=sr_1_1?ie=UTF8&qid=1377207875&sr=8-1&

This book is also available as an ebook from Amazon/Kindle, Google Ebooks, Kobo, and Nook.

From the Cayman Islands and the Isle of Man to the Principality of Liechtenstein and the state of Delaware, tax havens offer lower tax rates, less stringent regulations and enforcement, and promises of strict secrecy to individuals and corporations alike. In recent years government regulators, hoping to remedy economic crisis by diverting capital from hidden channels back into taxable view, have undertaken sustained and serious efforts to force tax havens into compliance.

In Tax Havens, Ronen Palan, Richard Murphy, and Christian Chavagneux provide an up-to-date evaluation of the role and function of tax havens in the global financial system—their history, inner workings, impact, extent, and enforcement. They make clear that while, individually, tax havens may appear insignificant, together they have a major impact on the global economy. Holding up to $13 trillion of personal wealth—the equivalent of the annual U.S. Gross National Product—and serving as the legal home of two million corporate entities and half of all international lending banks, tax havens also skew the distribution of globalization's costs and benefits to the detriment of developing economies.

The first comprehensive account of these entities, this book challenges much of the conventional wisdom about tax havens. The authors reveal that, rather than operating at the margins of the world economy, tax havens are integral to it. More than simple conduits for tax avoidance and evasion, tax havens actually belong to the broad world of finance, to the business of managing the monetary resources of individuals, organizations, and countries. They have become among the most powerful instruments of globalization, one of the principal causes of global financial instability, and one of the large political issues of our times.

http://www.cornellpress.cornell.edu/book/?GCOI=80140100541250



Paperback Edition– December 14, 2009 available at Amazon

http://www.amazon.com/Tax-Havens-Globalization-Cornell-Studies/dp/0801476127

OF COURSE, THERE HAVE BEEN MANY CHANGES SINCE 2008, WHEN THIS BOOK WOULD HAVE BEEN WRITTEN...BUT THEY COULDN'T COMPLETELY WIPE IT OUT.

AN UPDATE ON THE SUBJECT: http://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=5&cad=rja&uact=8&ved=0CD4QFjAE&url=http%3A%2F%2Flibrary.fes.de%2Fpdf-files%2Fiez%2Fglobal%2F10082.pdf&ei=OmQOVfTlPIGiNvO_hIgF&usg=AFQjCNGqtGbdLrYkLhu3nMz7nIzvmNoG2Q&bvm=bv.88528373,d.eXY

BY MARKUS HENN FROM 2013 IS AVAILABLE IN PDF FORMAT AT THIS LINK

http://thesaker.is/thinking-the-unthinkable/

...In truth, I have to admit that when I studied the theory of deterrence in 1980 my teachers always insisted that this theory of deterrence was predicated on what they called a “rational player”. To put it simply – how do you deter a lunatic? Or a desperate man with nothing to lose? Or a person hell-bent on mutual destruction? The truth is, you cannot. Deterrence assumes a rational actor making a logical decision about unacceptable costs. As far as I know, nobody has ever developed a theory of deterrence applicable to a madman. When I initially wrote my pieces explaining why I believed that a US/NATO/EU attack was impossible a lot readers posted comments saying that while maybe the top US military command was still mainly composed of rational men, the US imperial elites had clearly gone crazy a long time ago and that they were so stuck in their arrogance, their imperial hubris, their delusion of invincibility and their knee-jerk and systematic use of violence that they could no more be considered as rational. At the time I replied that, yeah, sure, maybe, but what is the point of analyzing something crazy? How do you try to make sense of the suicidally insane?

If Hillary's the answer, what's the question again?

Between 2009 and 2013, including when Mrs. Clinton was secretary of state, the Clinton Foundation received at least $8.6 million from the Victor Pinchuk Foundation, according to that foundation, which is based in Kiev, Ukraine. It was created by Mr. Pinchuk, whose fortune stems from a pipe-making company. He served two terms as an elected member of the Ukrainian Parliament and is a proponent of closer ties between Ukraine and the European Union.

In 2008, Mr. Pinchuk made a five-year, $29 million commitment to the Clinton Global Initiative, a wing of the foundation that coordinates charitable projects and funding for them but doesn’t handle the money. The pledge was to fund a program to train future Ukrainian leaders and professionals “to modernize Ukraine,” according to the Clinton Foundation. Several alumni are current members of the Ukrainian Parliament. Actual donations so far amount to only $1.8 million, a Pinchuk foundation spokesman said, citing the impact of the 2008 financial crisis.

The Pinchuk foundation said its donations were intended to help to make Ukraine “a successful, free, modern country based on European values.” It said that if Mr. Pinchuk was lobbying the State Department about Ukraine, “this cannot be seen as anything but a good thing.”

Complete story at - http://russia-insider.com/en/2015/03/22/4792

Article based on a Wall Street Journal article. Everything worthwhile is firewalled there. Would like to see that original article though.

Just Google the subject line of the article: Clinton Charity Tapped Foreign Friends

Then click on the link, and you can read the entire article.

"The foreign donors reached by The Wall Street Journal said they contributed to the foundation for charitable, not political reasons."

Riiight...of course they did.

"The Clinton Foundation swore off donations from foreign governments when Hillary Clinton was secretary of state. That didn’t stop the foundation from raising millions of dollars from foreigners with connections to their home governments, a review of foundation disclosures shows."

"After Mrs. Clinton left the State Department in 2013, the foundation resumed accepting donations from foreign governments. Just after she stepped down as secretary of state, it received a large donation from a conglomerate run by a member of China’s National People’s Congress."

"The foundation has said that if Mrs. Clinton runs for president, it would consider once again restricting donations from foreign governments. Also, under federal election law, foreign governments, individuals and corporations would be barred from giving to her campaign. "

"In 2008, Mr. Pinchuk made a five-year, $29 million commitment to the Clinton Global Initiative, a wing of the foundation that coordinates charitable projects and funding for them but doesn’t handle the money. The pledge was to fund a program to train future Ukrainian leaders and professionals “to modernize Ukraine,” according to the Clinton Foundation. Several alumni are current members of the Ukrainian Parliament. Actual donations so far amount to only $1.8 million, a Pinchuk foundation spokesman said, citing the impact of the 2008 financial crisis."



my god, the cheapest knife job the WSJ ever did, and it's all true!

10 million thrown out the door. Drained out of the local economy as tribute to the Empire, to buy a little power.

It's more than shocking. It's criminal.

It's going back into the teens tonight.

The Kid's staying home, tomorrow. She's sick enough that I don't want her out in that.

They predict it will warm up and rain on Wednesday...we will see. It's practically April! We should at least be above freezing when the sun rises by now!

Too much news, too many tax dodges. That's where all our creative minds are working!

For more breath-taking chutzpah, see the following:

http://en.wikipedia.org/wiki/Double_Irish_arrangement

http://en.wikipedia.org/wiki/Tax_haven

Or alternatively, go outside and enjoy Spring, if you have been lucky enough to get one.