Last month fewer people were looking for work, this month it increased. That does not negate the fact that more people are not counted as evident by the lame labor participation rate. AP needs to pay some people who know what they are talking about in analyzing government economic reports. They completely blew it on the January one and are again. They don't seem to grasp all things are derived from the civilian non-institutional population either.
and I can understand that, esp. from the BLS, but the truth is one can find the great income inequality, offshore outsourcing, labor arbitrage in these numbers. It's just a matter of knowing where to look.
Check out productivity and the decline in real compensation per hour. It's a horror show.
The difference between PI and GDP is composed of transfer payments, corporate profits largest and fastest growing piece. Transfer payments = SS + SSI + DI and others. What are all the pieces? The answer to this questions is how the poor are getting poorer, evident from the graph above compared to GDP. Overall
Personal Income is growing, that means the income of the rich.
At ground level, I am the only U.S. engineer in a sea of H1s. That sea of H1s cannot do real design, analysis,
or any real technology that requires original thought resulting in a product. The only reason for my own survival is even more interesting. Outsourcing has reached the point where intellectual capital needed right now is exhausted. A critical tipping point is approaching. Either the dysfunctional-State brings the
onshore economy to a near halt or enough on-shore intellectual captital is restored to keep the complete collapse at bay.
Take the anology of Ancient Rome in the Carthagenian Wars (when Rome manufactured its weapons) vs. the invasions of Rome starting with the Visigoths (when all weapons production was outsourced). Ancient Rome was burned to the ground by outsourcing. In World History, there are only 2 great empire-republics.
H1s do not do e-mail. Not one could pass an English proficiency high school standard test. Same with math and computer science. So why not ask the corporate proponents who demand proficiency from our children to
do the same with Visa workers? Make the Visas contingent
on high school standardized tests. Not a single H1 would pass those exams our kids are required to do.
We have major lobbyist agenda going on, this time with the claim of "innovation". It's BS. They are trying to claim that we must flood the labor market with "immigrants" in order to "innovate".
The U.S. has tons of programs already to ensure brilliant people get Visas, green cards and this is just to labor arbitrage even further.
It goes along with H-1B and now they want to turn our education system into a glorified green card machine.
Considering college graduates cannot get a job, including those in STEM, this is not a good idea.
Roberts lists a host of economists who know this and also know, the entire "innovation" mantra is crap. Apple "innovates" yet the real job growth is in China. Foxconn has 1 million workers.
That's because manufacturing scales and even Andy Grove has called this out. "Innovation" is needed and great, but if you don't manufacture, "make things" here in the U.S., all it does is make a few rich and ship more jobs overseas.
The thought occurred to me after reading what you wrote:
Why is Obama pushing everything about unemployment down the road -- when he expects to be in the White House when it all hits?
The unemployment crisis will manifest itself far sooner than later compared to Medicare, Social Security, deficit, or defense spending. Surely there's soon going to be a year more than a million dead broke unemployed and their families will end up on their relatives' doorsteps. Each spring since 2009 millions more new school graduates have been able to find a fulltime job (or even parttime job) and have become all but permanent guests at Hotel of Mom and Dad. Plus eventually there's lots of homeowners who will end up losing their house and/or go bankrupt.
Seriously, can't you just picture that by 2014 the millions of miserable Americans screaming at each other at home will also be screaming at images of President Obama, too, whenever he appear on the television set?
That would apply to other prominent politicians of both parties. Where's their self-preservation instincts?
Give me a break, are you a bank lobbyist? Add up transactions vs. fraud and then see the effect on small business. Sorry, doesn't add up. If the financial sector would stop offshore outsourcing everything remotely related to technology, maybe they would improve and their fraud costs would decrease.
Is the government justifying "charging for money" because of counterfeit? I don't think so, this is just another classic make money from nothing business model of the financial sector and it hurts small business, you cut into their very small profits.
It's expensive to run transactions on the debit card network for small banks and credit unions. The true cost is far higher than 4 cents that everyone keeps quoting. Our true cost is several times higher than that for each transaction.
Another cost not quoted is the cost of fraud. Just look up Michaels Las Vegas Banks in google and look for the articles that quote how thousands of accounts have been cleaned out at their local banks. Banks have to pay for those losses and it is because of the Michaels Breach (a merchant).
Bigger merchants do have lower fees because they are larger and have higher transaction volume - what you would expect in a market economy. As a point of fact, merchant fees have not tripled or quadrupled for debit card transactions in the last 10 years. The rate has actually decreased; however, the number of transactions using debit or credit has tripled or quadrupled.
Merchants that accept face to face transactions with signature or pin, are largely exempt from paying for these fraud losses. So, when my bank has a debit or credit card cloned and they go on a shopping spree in the Vegas mall, we (the bank) get to pay for the fraud losses, not the merchant. That is why we receive interchange - it helps to pay for the fraud losses.
The Chicago Fed just did an analysis claiming 10%-25% of the unemployment rate drop can be attributed to people falling off of the count, running out of benefits.
I didn't post it because I needed to check their assumptions. Seems low actually, but bottom line people not being able to find a job and falling off of the count eventually is one of the reasons the unemployment rate has dropped.
Most of it is labor participation rate, as well as population growth assumptions...
The real thing to look at is the actual number of payroll jobs created.
But I'm sure we'll hear "weather" or all sorts of crap or we might get a solid unemployment report, I don't know.
I'll be pouring all over it to be sure tomorrow. But bottom line, even with a blow out, we have a jobs crisis.
I expect to see something like 60k or so jobs created and I expect the unemployment rate to drop, but only due to the above factors, not actual jobs created.
So one way or the other, you think the report's going to be bad.
I guess there will be silence or the usual empty rhetoric from Obama on down.
After the election Bernancke started speaking up about the full employment not returning for about 5+ years. Haven't heard anything like that from him or anybody else in months.
indeed.com has a good site, job trends from their database.
Now on tech jobs, I can tell you companies will put out tons of ads with no intention to hire.
They are looking for specialty skills and it gets so exacting, they will put out an absurd amount of ads, so one needs to look at the actual growth in jobs for that region as well as occupational jobs.
They also are notorious to use ads to simply import foreign workers instead of giving a U.S. worker even a shot. It's just a legal maneuver to offshore outsource your job de facto.
Sometimes the ADP has really diverged, although I suspect, strongly, we're going to get a crappy employment report on Friday due to initial unemployment claims being above 400k plus some of the GDP numbers coming in that eventually will make up Q2 GDP are looking horrific.
in positions of power are just taking as much as they can and the rest are just following orders. The few who have a conscience and try to blow the whistle get burned.
The off-shoring of jobs is a short sighted quest for profits at best, or at worst, a plan to minimize the power of the middle class in order to protect the power of the ruling elite. Surely, the last thing that the rulers want is for people to realize that they have been enslaved and demand a restoration of our rights to control government and ensure liberty and justice.
Unfortunately, instead of teaching how the Framers intended for us to secure liberty and justice, every school day, the children say a prayer to GOTUS, the giver of liberty and justice, and then, they see a multitude of TV shows where heroic government crime fighters always pursue justice. As a result, most people believe that justice is magically secured if we just beg and plead hard enough, much like the feudal reign which the Framers sought to eliminate.
If you want to know how we were supposed to be able to control the government and secure liberty and justice, see Why Does the Government Ignore Our Wishes? at http://ning.it/arAjdo and don’t miss my short speech at http://markadams.blip.tv/file/2636803/
If you take a look, you’ll learn why those in government and those who can illegally influence them get away with violating our rights, abusing their power, and committing horrible crimes. My article on torture includes a link to the U.S. Supreme Court case which explains how one of our stolen rights makes the difference between justice and injustice, between freedom and slavery.
WARNING: Do not look at this if you cannot deal with reality. It may cause anger, headaches, insomnia, dizziness, difficulty in reciting the pledge of allegiance, a.k.a. the prayer to GOTUS, and result in the awareness that you are not free.
Find the databases and I can put together the graphs. We can also show correlation, I can do regression analysis and so on. We can talk offline about getting some "big picture" data. I wrote up many a piece on derivatives, all during 2008/2009 and then of course we got....swiss cheese called "financial reform". So a deep research piece on where we are now, with data, would be really useful.
Maybe data on the financialization of America and global capital flows would be useful too. I can show, by industry and percentage of GDP, but the data is at best 1 year old. (BEA).
I'll try to do a "big picture" of a lot of these recent economic reports as well as oil.
For now, high oil prices are strongly correlated to recessions and this report is astoundingly horrific in terms of change. We might very well be in for a "double dip", although, I think by any real world person, the "Great recession" never ended. Makes me also think the NBER should reconsider their "business cycle" classifications for those "long term downward trends".
I've seen a chart a few times - I don't remember where - that places securitization volumes on top of Fed C&I loan data. I'll try and drag it up. It is not quite what you want, because it doesn't encompass the multiple credit extensions that existed through both securitization and the use of derivatives as hedges of credit risk. A daisy chain of risk was created from bank to bank around the globe on each original security, and it was this pyramid of credit that collapsed. It's very hard to figure out how much credit was involved, because for example there were such things as CDOs squared which required very large amounts of underlying securities in order to hedge. Then, there were synthetic securities - imaginary bonds that were never issued by any company but were nonetheless the basis for some derivative transaction. That is still going on, by the way.
One reason the Fed never took this seriously is because it did not believe shadow banking had the power to extend credit. Fed economists got into long discussions from 2000 - 20004 with people like Doug Noland, who insisted that shadow banking was every bit as responsible for the explosion in credit as the banks themselves. The Fed was all hung up on its understanding of reserve banking and the multiplier, and lost sight of the reality of credit creation. I think it was only in 2006 that they finally conceded the point. I suspect at some institutional level the Fed knew credit creation was out of control and they wanted to distance themselves from responsibility for the eventual crack-up. That is why they stopped publishing M3, which very clearly showed the effects of shadow banking on the money supply.
My own impression, having been in the thick of banking and derivatives from the beginning of the product, is that around 1995, but sooner for some NY banks, the large banks moved away from keeping loans on their books and began to sell them off to other banks and to investors. This started out slowly, but by 2000 the securitization structure was in place whereby the big banks could keep but a fraction of any large corporate loan or mortgage portfolio that they booked. In fact, approvals on these deals were based on assurances from the loan officers and syndication specialists that a particular amount would be sold in the market. The game of course was to reduce assets, shift revenue away from interest income and on to fee income from churning loans through securitizations, and maximizing bank capital. The end result was that many more loans could be done than previously when the banks had to keep them entirely, and a pyramid of credit could be created through derivatives on top of these loans.
What has to be appreciated is that, since 2008, we are operating in the pre-1995 world. Some securitizations are coming back into the market, but only a fraction of what used to be done, and at much different pricing now that people see the true risks. What also has to be appreciated is that if the big banks want to revive securitization, they will need much higher levels of capital, because the passing of credit risks from one bank to another to another created enormous systemic risk that was never properly priced in the system. Capital may need to be 20% of assets, not 12%. This is about as onerous as the system we have now, where banks can operate with 12% capital levels, but securitization is dead and they therefore have to keep 100% of their loans on their books. Either way, the global lending system is grievously constrained, placing us somewhere back 15 years or more. Imagine what sort of burden that is on the global economy.
Massive unemployment means increased profits and increased campaign contributions. Our corrupt politicians have their hands in this, and only public funding of campaigns will reverse it.
Our trashed economy was due — 100% — to campaign cash changing hands. Absolutely *NOTHING* will fix our system without getting to the root: political corruption. Politicians sharing in the booty by taking campaign bribes, and then rolling over to the industry that wants in the taxpayer's pockets. The recent "crisis commission" blamed everyone except the nation's board of directors -- our CONGRESS -- even when the politicians are 100% to blame.
The key problem is the way we finance elections. There are only two kinds of money: public and private. Private money got us here and nothing will change until we get these legal bribes out of politics. But a fix is vigorously opposed by the political elite that benefit from the existing corruption.
Nothing else matters, regardless of your issue. Nothing is going to change until we have public funding of campaigns. Politicians spend taxpayer dollars because they ARE PAID to spend taxpayer dollars, and robbing the SSI fund and Medicare (as just two examples) gives them the cash needed to attract campaign dollars.
Our problem is NOT government, and it is not R’s or D’s. It *IS* that government is owned by CEOs and corporate interests that want in the taxpayer’s pockets. The 2010 elections were funded by just 1% of Americans, when they should be financed by 100% of taxpayers. And at $5 per taxpayer it would be a bargain. Even at 100 times that.
CEOs want short-term profits to increase their already massive salaries, and are willing to share those profits with the politicians that made it all happen. Thus NAFTA and other laws are passed that enable outsourcing to countries with wage scales one-tenth ours. Or are repealed (like Glass-Seagall) to enable the Fat Cat bankers to rip off the public. And all while deregulation crashes our country, China and India flourish.
In addition to public funding of campaigns, politicians must also (a) be put on a pay-for-performance basis, where if deficits or pork barrel and special interest spending go up, their pay goes down, and (b) they must put their own wealth in a blind trust that blocks political insider trading (which today is rampant). They must also get their health care from Medicare and their retirement from Social Security, and receive it only when they reach 67 or 69 or whatever age the rest of us qualify.
As a former CEO my company would not have survived if I had an employee or board of directors who took money on the side and gave away company assets in return. Our country can’t survive this corruption either.
So the voters change nothing. We elect a new group of politicians and the Fat Cats simply re-direct their bribes as we continue down our spiral. But the problem is that all of these changes must be made by the foxes themselves (congress).
The public's choices are simple: a 100% turnover of politicians until the above fixes are made, or a national revolution is inevitable. And all because our politicians refuse to stop the bribery they benefit from, and the public refused to stop it.
If politicians are going to be beholden to their funders, those funders should be the taxpayers. We MUST demand that our senators and representative pass the bill at: http://fairelectionsnow.org/about-bill
Actually Jobs is back in the political dialog? Just this week the Republicans put forth their "A Plan for America's Job Creators" proposal. From the "roll out" news conference, I gather the core of the plan is tax "relief" for the "poor" exploited corporations.
Talk about Orwellian!
"Here is what the above numbers do not show, the screw job on the poor, as shown by the spike up in the below graph."
There's less relief during a recession for those who have lost their jobs. A marginal increase would be a difference for the poor and that would be an aid to the economy. But no, the Scrooge Principle prevails.
Our leaders should be ashamed of themselves but shame is a concept that doesn't meet their standards.
Last month fewer people were looking for work, this month it increased. That does not negate the fact that more people are not counted as evident by the lame labor participation rate. AP needs to pay some people who know what they are talking about in analyzing government economic reports. They completely blew it on the January one and are again. They don't seem to grasp all things are derived from the civilian non-institutional population either.
and I can understand that, esp. from the BLS, but the truth is one can find the great income inequality, offshore outsourcing, labor arbitrage in these numbers. It's just a matter of knowing where to look.
Check out productivity and the decline in real compensation per hour. It's a horror show.
The difference between PI and GDP is composed of transfer payments, corporate profits largest and fastest growing piece. Transfer payments = SS + SSI + DI and others. What are all the pieces? The answer to this questions is how the poor are getting poorer, evident from the graph above compared to GDP. Overall
Personal Income is growing, that means the income of the rich.
At ground level, I am the only U.S. engineer in a sea of H1s. That sea of H1s cannot do real design, analysis,
or any real technology that requires original thought resulting in a product. The only reason for my own survival is even more interesting. Outsourcing has reached the point where intellectual capital needed right now is exhausted. A critical tipping point is approaching. Either the dysfunctional-State brings the
onshore economy to a near halt or enough on-shore intellectual captital is restored to keep the complete collapse at bay.
Take the anology of Ancient Rome in the Carthagenian Wars (when Rome manufactured its weapons) vs. the invasions of Rome starting with the Visigoths (when all weapons production was outsourced). Ancient Rome was burned to the ground by outsourcing. In World History, there are only 2 great empire-republics.
H1s do not do e-mail. Not one could pass an English proficiency high school standard test. Same with math and computer science. So why not ask the corporate proponents who demand proficiency from our children to
do the same with Visa workers? Make the Visas contingent
on high school standardized tests. Not a single H1 would pass those exams our kids are required to do.
We have major lobbyist agenda going on, this time with the claim of "innovation". It's BS. They are trying to claim that we must flood the labor market with "immigrants" in order to "innovate".
The U.S. has tons of programs already to ensure brilliant people get Visas, green cards and this is just to labor arbitrage even further.
It goes along with H-1B and now they want to turn our education system into a glorified green card machine.
Considering college graduates cannot get a job, including those in STEM, this is not a good idea.
Roberts lists a host of economists who know this and also know, the entire "innovation" mantra is crap. Apple "innovates" yet the real job growth is in China. Foxconn has 1 million workers.
That's because manufacturing scales and even Andy Grove has called this out. "Innovation" is needed and great, but if you don't manufacture, "make things" here in the U.S., all it does is make a few rich and ship more jobs overseas.
The thought occurred to me after reading what you wrote:
Why is Obama pushing everything about unemployment down the road -- when he expects to be in the White House when it all hits?
The unemployment crisis will manifest itself far sooner than later compared to Medicare, Social Security, deficit, or defense spending. Surely there's soon going to be a year more than a million dead broke unemployed and their families will end up on their relatives' doorsteps. Each spring since 2009 millions more new school graduates have been able to find a fulltime job (or even parttime job) and have become all but permanent guests at Hotel of Mom and Dad. Plus eventually there's lots of homeowners who will end up losing their house and/or go bankrupt.
Seriously, can't you just picture that by 2014 the millions of miserable Americans screaming at each other at home will also be screaming at images of President Obama, too, whenever he appear on the television set?
That would apply to other prominent politicians of both parties. Where's their self-preservation instincts?
Give me a break, are you a bank lobbyist? Add up transactions vs. fraud and then see the effect on small business. Sorry, doesn't add up. If the financial sector would stop offshore outsourcing everything remotely related to technology, maybe they would improve and their fraud costs would decrease.
Is the government justifying "charging for money" because of counterfeit? I don't think so, this is just another classic make money from nothing business model of the financial sector and it hurts small business, you cut into their very small profits.
It's expensive to run transactions on the debit card network for small banks and credit unions. The true cost is far higher than 4 cents that everyone keeps quoting. Our true cost is several times higher than that for each transaction.
Another cost not quoted is the cost of fraud. Just look up Michaels Las Vegas Banks in google and look for the articles that quote how thousands of accounts have been cleaned out at their local banks. Banks have to pay for those losses and it is because of the Michaels Breach (a merchant).
Bigger merchants do have lower fees because they are larger and have higher transaction volume - what you would expect in a market economy. As a point of fact, merchant fees have not tripled or quadrupled for debit card transactions in the last 10 years. The rate has actually decreased; however, the number of transactions using debit or credit has tripled or quadrupled.
Merchants that accept face to face transactions with signature or pin, are largely exempt from paying for these fraud losses. So, when my bank has a debit or credit card cloned and they go on a shopping spree in the Vegas mall, we (the bank) get to pay for the fraud losses, not the merchant. That is why we receive interchange - it helps to pay for the fraud losses.
The Chicago Fed just did an analysis claiming 10%-25% of the unemployment rate drop can be attributed to people falling off of the count, running out of benefits.
I didn't post it because I needed to check their assumptions. Seems low actually, but bottom line people not being able to find a job and falling off of the count eventually is one of the reasons the unemployment rate has dropped.
Most of it is labor participation rate, as well as population growth assumptions...
The real thing to look at is the actual number of payroll jobs created.
But I'm sure we'll hear "weather" or all sorts of crap or we might get a solid unemployment report, I don't know.
I'll be pouring all over it to be sure tomorrow. But bottom line, even with a blow out, we have a jobs crisis.
I expect to see something like 60k or so jobs created and I expect the unemployment rate to drop, but only due to the above factors, not actual jobs created.
So one way or the other, you think the report's going to be bad.
I guess there will be silence or the usual empty rhetoric from Obama on down.
After the election Bernancke started speaking up about the full employment not returning for about 5+ years. Haven't heard anything like that from him or anybody else in months.
The unemployed do not give campaign contributions (bribes), only the wealthy do.
indeed.com has a good site, job trends from their database.
Now on tech jobs, I can tell you companies will put out tons of ads with no intention to hire.
They are looking for specialty skills and it gets so exacting, they will put out an absurd amount of ads, so one needs to look at the actual growth in jobs for that region as well as occupational jobs.
They also are notorious to use ads to simply import foreign workers instead of giving a U.S. worker even a shot. It's just a legal maneuver to offshore outsource your job de facto.
Sometimes the ADP has really diverged, although I suspect, strongly, we're going to get a crappy employment report on Friday due to initial unemployment claims being above 400k plus some of the GDP numbers coming in that eventually will make up Q2 GDP are looking horrific.
in positions of power are just taking as much as they can and the rest are just following orders. The few who have a conscience and try to blow the whistle get burned.
The off-shoring of jobs is a short sighted quest for profits at best, or at worst, a plan to minimize the power of the middle class in order to protect the power of the ruling elite. Surely, the last thing that the rulers want is for people to realize that they have been enslaved and demand a restoration of our rights to control government and ensure liberty and justice.
Unfortunately, instead of teaching how the Framers intended for us to secure liberty and justice, every school day, the children say a prayer to GOTUS, the giver of liberty and justice, and then, they see a multitude of TV shows where heroic government crime fighters always pursue justice. As a result, most people believe that justice is magically secured if we just beg and plead hard enough, much like the feudal reign which the Framers sought to eliminate.
If you want to know how we were supposed to be able to control the government and secure liberty and justice, see Why Does the Government Ignore Our Wishes? at http://ning.it/arAjdo and don’t miss my short speech at http://markadams.blip.tv/file/2636803/
If you take a look, you’ll learn why those in government and those who can illegally influence them get away with violating our rights, abusing their power, and committing horrible crimes. My article on torture includes a link to the U.S. Supreme Court case which explains how one of our stolen rights makes the difference between justice and injustice, between freedom and slavery.
WARNING: Do not look at this if you cannot deal with reality. It may cause anger, headaches, insomnia, dizziness, difficulty in reciting the pledge of allegiance, a.k.a. the prayer to GOTUS, and result in the awareness that you are not free.
Find the databases and I can put together the graphs. We can also show correlation, I can do regression analysis and so on. We can talk offline about getting some "big picture" data. I wrote up many a piece on derivatives, all during 2008/2009 and then of course we got....swiss cheese called "financial reform". So a deep research piece on where we are now, with data, would be really useful.
Maybe data on the financialization of America and global capital flows would be useful too. I can show, by industry and percentage of GDP, but the data is at best 1 year old. (BEA).
I'll try to do a "big picture" of a lot of these recent economic reports as well as oil.
For now, high oil prices are strongly correlated to recessions and this report is astoundingly horrific in terms of change. We might very well be in for a "double dip", although, I think by any real world person, the "Great recession" never ended. Makes me also think the NBER should reconsider their "business cycle" classifications for those "long term downward trends".
I've seen a chart a few times - I don't remember where - that places securitization volumes on top of Fed C&I loan data. I'll try and drag it up. It is not quite what you want, because it doesn't encompass the multiple credit extensions that existed through both securitization and the use of derivatives as hedges of credit risk. A daisy chain of risk was created from bank to bank around the globe on each original security, and it was this pyramid of credit that collapsed. It's very hard to figure out how much credit was involved, because for example there were such things as CDOs squared which required very large amounts of underlying securities in order to hedge. Then, there were synthetic securities - imaginary bonds that were never issued by any company but were nonetheless the basis for some derivative transaction. That is still going on, by the way.
One reason the Fed never took this seriously is because it did not believe shadow banking had the power to extend credit. Fed economists got into long discussions from 2000 - 20004 with people like Doug Noland, who insisted that shadow banking was every bit as responsible for the explosion in credit as the banks themselves. The Fed was all hung up on its understanding of reserve banking and the multiplier, and lost sight of the reality of credit creation. I think it was only in 2006 that they finally conceded the point. I suspect at some institutional level the Fed knew credit creation was out of control and they wanted to distance themselves from responsibility for the eventual crack-up. That is why they stopped publishing M3, which very clearly showed the effects of shadow banking on the money supply.
My own impression, having been in the thick of banking and derivatives from the beginning of the product, is that around 1995, but sooner for some NY banks, the large banks moved away from keeping loans on their books and began to sell them off to other banks and to investors. This started out slowly, but by 2000 the securitization structure was in place whereby the big banks could keep but a fraction of any large corporate loan or mortgage portfolio that they booked. In fact, approvals on these deals were based on assurances from the loan officers and syndication specialists that a particular amount would be sold in the market. The game of course was to reduce assets, shift revenue away from interest income and on to fee income from churning loans through securitizations, and maximizing bank capital. The end result was that many more loans could be done than previously when the banks had to keep them entirely, and a pyramid of credit could be created through derivatives on top of these loans.
What has to be appreciated is that, since 2008, we are operating in the pre-1995 world. Some securitizations are coming back into the market, but only a fraction of what used to be done, and at much different pricing now that people see the true risks. What also has to be appreciated is that if the big banks want to revive securitization, they will need much higher levels of capital, because the passing of credit risks from one bank to another to another created enormous systemic risk that was never properly priced in the system. Capital may need to be 20% of assets, not 12%. This is about as onerous as the system we have now, where banks can operate with 12% capital levels, but securitization is dead and they therefore have to keep 100% of their loans on their books. Either way, the global lending system is grievously constrained, placing us somewhere back 15 years or more. Imagine what sort of burden that is on the global economy.
Massive unemployment means increased profits and increased campaign contributions. Our corrupt politicians have their hands in this, and only public funding of campaigns will reverse it.
Our trashed economy was due — 100% — to campaign cash changing hands. Absolutely *NOTHING* will fix our system without getting to the root: political corruption. Politicians sharing in the booty by taking campaign bribes, and then rolling over to the industry that wants in the taxpayer's pockets. The recent "crisis commission" blamed everyone except the nation's board of directors -- our CONGRESS -- even when the politicians are 100% to blame.
The key problem is the way we finance elections. There are only two kinds of money: public and private. Private money got us here and nothing will change until we get these legal bribes out of politics. But a fix is vigorously opposed by the political elite that benefit from the existing corruption.
Nothing else matters, regardless of your issue. Nothing is going to change until we have public funding of campaigns. Politicians spend taxpayer dollars because they ARE PAID to spend taxpayer dollars, and robbing the SSI fund and Medicare (as just two examples) gives them the cash needed to attract campaign dollars.
Our problem is NOT government, and it is not R’s or D’s. It *IS* that government is owned by CEOs and corporate interests that want in the taxpayer’s pockets. The 2010 elections were funded by just 1% of Americans, when they should be financed by 100% of taxpayers. And at $5 per taxpayer it would be a bargain. Even at 100 times that.
CEOs want short-term profits to increase their already massive salaries, and are willing to share those profits with the politicians that made it all happen. Thus NAFTA and other laws are passed that enable outsourcing to countries with wage scales one-tenth ours. Or are repealed (like Glass-Seagall) to enable the Fat Cat bankers to rip off the public. And all while deregulation crashes our country, China and India flourish.
In addition to public funding of campaigns, politicians must also (a) be put on a pay-for-performance basis, where if deficits or pork barrel and special interest spending go up, their pay goes down, and (b) they must put their own wealth in a blind trust that blocks political insider trading (which today is rampant). They must also get their health care from Medicare and their retirement from Social Security, and receive it only when they reach 67 or 69 or whatever age the rest of us qualify.
As a former CEO my company would not have survived if I had an employee or board of directors who took money on the side and gave away company assets in return. Our country can’t survive this corruption either.
So the voters change nothing. We elect a new group of politicians and the Fat Cats simply re-direct their bribes as we continue down our spiral. But the problem is that all of these changes must be made by the foxes themselves (congress).
The public's choices are simple: a 100% turnover of politicians until the above fixes are made, or a national revolution is inevitable. And all because our politicians refuse to stop the bribery they benefit from, and the public refused to stop it.
If politicians are going to be beholden to their funders, those funders should be the taxpayers. We MUST demand that our senators and representative pass the bill at: http://fairelectionsnow.org/about-bill
Jack Lohman …
http://MoneyedPoliticians.net
Actually Jobs is back in the political dialog? Just this week the Republicans put forth their "A Plan for America's Job Creators" proposal. From the "roll out" news conference, I gather the core of the plan is tax "relief" for the "poor" exploited corporations.
Talk about Orwellian!
"Here is what the above numbers do not show, the screw job on the poor, as shown by the spike up in the below graph."
There's less relief during a recession for those who have lost their jobs. A marginal increase would be a difference for the poor and that would be an aid to the economy. But no, the Scrooge Principle prevails.
Our leaders should be ashamed of themselves but shame is a concept that doesn't meet their standards.
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