I spent probably a good 4 hours on this post, trying to find exactly what was modified by "accounting changes" and what specific, nebulously referred to "accounting changes" were meant by each corporate earnings calls.
I mean digging through transcripts, statements.
This was a good as I could dig and this post is actually 2 days late too.
So, it leaves me deeply wondering what other kinds of toxic assets and hidden losses are on the books, enabled by relaxed accounting rules?
It would be interesting to do a graphic comparison/contrast to Japan in the same time window from the start of it.
I wouldn't be surprised to see a curve overlay and so on.
State Foreclosure Prevention Working Group, a collection of 12 state attorneys general and three state banking supervisors, have a new study (don't see the link)
but concludes it's a failure to write down principle.
You might want to do a "follow up" if it has a lot of stats, graphs and such?
Zero percent interest rates, a historically steep yield curve, massive government support, a huge stock market rally, and yet they still can't manage a profit?
This sounds exactly like Japan circa 1990's.
Did you see any specifics on the probability of sovereign default and a time line?
I saw their credit default swaps soar through the moon but are we going to really get a domino crash and burn?
Have you noticed when it comes to the Zombie banks, everyone runs around and says "OMG, it's Economic Armageddon, we must bail them out! But when a country fails, it's oh, sign, oh well, what can we do, they have to cancel their entire social structure, go bankrupt, wipe out their social safety nets, yada, yada.
What's wrong with that picture?
(how can we allow these glorified chips of doom to be traded and piled on to pay out when something really bad happens? Major need to look into CDS on Sovereign debt )
Where I live property is reassessed every 3 years. Right now our assessors office is inundated with appeals. In some counties if you can show at least 3 comparable arms length/non-foreclosure sales you can get your property reassessed lower.
This isn't debt repayment; it's reparations. It's penalties imposed on the losers in the economic wars. And we know from experience how well reparations work. The 1930 payments sent the Weimar Republic into a death spiral that led to Hitler and pushed France into the Great Depression.
My town sped up its revaluations so they could avoid criticism.
My house was valued by Zillow at $724,000 at its peak in 2007.
The local tax evaluated it at $525,000 in the summer of 2009 and at that point Zillow showed it at $325,000.
One has nothing to do with the other. The local tax evaluations have more to do with what they need rather than what the homes are worth at least thats been my own experience.
We are also seeing the ramifications of 'don't worry it always goes up' and out of control entitlement programs that didn't exist when taxes were much much higher.
This is more than municipal and state jobs. This goes to basic services including law enforcement. States and municipalities are about get hit really hard when real property starts being reassessed lower because of real estate prices including commercial.
I agree about raising taxes but now is not the time - we need counter cyclical measures right now.
We are seeing the ramifications of "tax cuts ALL the time every time".
Citi was bailed out in the early ninties on the QT at the time and they have never been the picture of health.
I have a picture of them partying in their corporate tower while a lowly gas company employee is turning the gas off in the basement because Citi can't pay the bill as the mailman passes him carrying notices to several million citi card holders that their rates are being increased to 60% because, well no reason given.
They should have been seized by the FDIC last fall. We have protected the wealthy shareholders at the expense of taxpayers and the overall health of our economy now dependent on zombie banks.
So we'll be left with a huge federal tax bill to maintain employment for state workers? This is just a regurgitation of the stimulus package which is targeted at keeping a specific group of people employed while sending the bill to everyone.
At some point this putting off till tomorrow what we can do today way of doing things has to end.
If the politicians do not have the cohones to raise taxes back to where they were before Reagan then we have to cut entitlement programs and on the state level cut employment. My state gives a 3% annual cost of living increase for all retirees and doesn't tax state pensions either. I can't get that in my business because someone has to pay the bills.
We cannot have our cake (supporting entitlement programs, bailing out the financial system and maintaining high government employment levels with golden retirements) and eat it too (lowering taxes for the wealthy)- something has to give.
My state like Illinois has also put off payments on their pension funds in order to balance budgets. Its going to catch up on us. Its catching up to us right now.
Oregon has ballot measures, 66, 67 to raise taxes. The problem is they are misrepresenting the taxes, even in the ballot pamphlet.
It took me forever to figure this out. They are literally taxing gross receipts, i.e. gross income, i.e. gross sales.
So, if a business does $500k in sales, regardless if their operating costs are $1 M, they are going to get taxed.
i.e. taxed even with a $500k yearly loss.
I swear to God, do Democrats know how to screw something up or what? They didn't bother to just close the loopholes which enables corporations to write off things that shouldn't be written off to avoid taxes, esp. using other state and national tax codes to do it...
they didn't bother to really analyze the state corporate tax code...
nope, they did this, which of course is going to shut down a host of small businesses who hire workers.
This is with around a 11% unemployment rate.
BTW: this is why all corporate tax codes tax net, not gross....because of course all businesses have major expenses, operating costs ....like salaries, wages, benefits, retirement they must pay for and so no one in their right mind would want to tax those because if a business has problems and doesn't turn a profit, they now have an additional tax liability on top of things.
Honestly, I didn't believe it and normally never listen to those "anti-tax" rants and I think everyone on this site knows I've been pro a host of new tax innovations....
but this is just stuck on stupid.
It's no wonder to me voters keep flipping parties since neither one can do anything that makes plain common sense.
On this one, I had to go dig out the actual legislation and it took forever to analyze for I couldn't believe someone would put together a tax that was so obviously detrimental to job growth and small business.
A $500 per capita Federal distribution to all the States to sustain employment in essential services, service debt, and reduce the need for State tax hikes. This can be repeated at perhaps 6 month intervals until GDP surpasses previous high levels at which point state revenues that depend on GDP are restored.
Good deal! I'm trying to get these code modifications done, I keep having to deal with other stuff, to get the site upgraded.
People are complaining and rightly so, on the CAPTCHA, and a huge part of the upgrade is better security that isn't so obnoxious!
So, ya all, if you're in the mood to write up blog posts, Instapopulists, now is the time for myself, I've got a pipeline and each one takes a good 3 hours of research to be worth a damn, really behind in the queue!
Also, Rebel, the reason I give you so much $hit on "Progressive" is we're really linked into the economics blog communities and also to not "turn off" someone to read the post details due to political labels. i.e. they see political terms instead of the plain good ole fashioned ripoff details and kind of just bypass the post due to association with political terminology instead of economic terminology or "rip off info" terminology.
Hope that makes it more clear as to why I'm pinging on political labeling.
Instead of "class warfare" it is truly a war over economic policy. Monetarism and neo-liberalism is great for certain groups including corporations (and those who control them). The foundation or logic behind neo-liberalism is a re-direction of income from low & middle income families to corporations and upper class.
As for Ayn Rand, it is scary and too many people truly don't understand it. Objectivism is a utopian society and it runs contrary to our Constitution. Objectivism and libertarianism may work if everyone were equal and had the same opportunities. We are far from that.
Thanks for that excellent addendum. And great remark on Iceland. I was pointed in that direction by Prof. Michael Hudson (who, along with Steve Keen, and the last decade or so, Paul Craig Roberts, has been correct in all his long-term macroeconomic pronouncements, as well as always getting those piddling details correct).
In looking at Iceland, and more so deeply due to that Norwegian-French lady magistrate who has been investigating their banking practices, the entire government and banking system appears to have been highly, highly securitized. They truly bought into the securitization/credit derivatives scam in a major way.
Regarding Milton Friedman, I will never, ever comprehend who anyone regards him as anything other than a looney tunes. Everything he ever commented on (OK, one exception about those central bankers not being reliable) was so truly bizarre, as well as the fact he never walked his talk (everyone else should exist in a "right-to-be-immediately terminated" status, except him, who had tenure).
What's even worse, his ignorance on the mitigating factors of the Great Depression. Anyone who professes to be an economics or economic history scholar of that period, yet doesn't grasp the importance of securitization back then leading up to the Great Crash of '29, is strictly out to lunch.
The sad thing about the American public today is that sales of books written by Ayn Rand have really exploded recently! During the Great Depression at least a large number of Americans had a grasp on what was taking place; today far too many are oblivious, befuddled and can't even begin to understand who their enemy is in this scenario!
Basically we are "the people", therefore Populist is whatever we say it is! ;)
Officially it's a "catch all" which is another reason to grab it.
Populism usually means the majority of the people want something and also yes, there are a few trying to co-opt the term but it's really from way back in the early part of this century, last part about 1896 and this was kind of a similar movement to the Progressive moments of that time, i.e. TR, etc.
But you're right and "Populism" has been used for about every movement that was an upstart or not the establishment, including some pretty scary ones.
But officially it's a "by the people" sort of deal and since EP is a non-partisan, anyone can write as long as they have their facts on straight and are cited, credible....kind of fit.
Also picked it so people would feel free to buck whatever the party line was if it didn't make a lot of economic sense.
In regards to trade, the problem we have is HOW we engaged globalization not whether to engage or not. Isolation would be crazy but unfettered "free trade" is also crazy.
That's pretty damn vague frankly. One can claim some policy is "opportunity" when in reality it's a disaster. Take joining the WTO as an example...that was sold on a host of so called "progressive" values and look at the results.
This is a primary point of EP....I should add it to the FAQ...no vague adjectives allowed. ;) Seriously, how many times have the American people be sold some corporate lobbyists' wet dream on some nice sounding claims?
The point of EP is to get to the real statistics and details and this is why....trojan horses. Unless one digs in deep, you do not realize what's really going on.
I know I'm giving you a hard time, but this is seriously important. I cannot tell how many times I've seen something labeled as "fill in the blank" political flavor to look at the details and realize it was policy which would significantly hurt the U.S. national economic interest, middle class, American workers and so on.
Even some of my favorite blow hards have their weaknesses on some policy areas.
Speaking of this, I noticed HuffPo has Pat Choate on the business blog columnists, which is good. I believe Choate is either an ind. or even possibly a conservative...
but on economics, he's got some of the best statistics I have seen to date, which is probably how he got a column.
I spent probably a good 4 hours on this post, trying to find exactly what was modified by "accounting changes" and what specific, nebulously referred to "accounting changes" were meant by each corporate earnings calls.
I mean digging through transcripts, statements.
This was a good as I could dig and this post is actually 2 days late too.
So, it leaves me deeply wondering what other kinds of toxic assets and hidden losses are on the books, enabled by relaxed accounting rules?
It would be interesting to do a graphic comparison/contrast to Japan in the same time window from the start of it.
I wouldn't be surprised to see a curve overlay and so on.
HuffPo lists a new study that just came out.
State Foreclosure Prevention Working Group, a collection of 12 state attorneys general and three state banking supervisors, have a new study (don't see the link)
but concludes it's a failure to write down principle.
You might want to do a "follow up" if it has a lot of stats, graphs and such?
Zero percent interest rates, a historically steep yield curve, massive government support, a huge stock market rally, and yet they still can't manage a profit?
This sounds exactly like Japan circa 1990's.
Did you see any specifics on the probability of sovereign default and a time line?
I saw their credit default swaps soar through the moon but are we going to really get a domino crash and burn?
Have you noticed when it comes to the Zombie banks, everyone runs around and says "OMG, it's Economic Armageddon, we must bail them out! But when a country fails, it's oh, sign, oh well, what can we do, they have to cancel their entire social structure, go bankrupt, wipe out their social safety nets, yada, yada.
What's wrong with that picture?
(how can we allow these glorified chips of doom to be traded and piled on to pay out when something really bad happens? Major need to look into CDS on Sovereign debt )
Where I live property is reassessed every 3 years. Right now our assessors office is inundated with appeals. In some counties if you can show at least 3 comparable arms length/non-foreclosure sales you can get your property reassessed lower.
RebelCapitalist.com - Financial Information for the Rest of Us.
This isn't debt repayment; it's reparations. It's penalties imposed on the losers in the economic wars. And we know from experience how well reparations work. The 1930 payments sent the Weimar Republic into a death spiral that led to Hitler and pushed France into the Great Depression.
My town sped up its revaluations so they could avoid criticism.
My house was valued by Zillow at $724,000 at its peak in 2007.
The local tax evaluated it at $525,000 in the summer of 2009 and at that point Zillow showed it at $325,000.
One has nothing to do with the other. The local tax evaluations have more to do with what they need rather than what the homes are worth at least thats been my own experience.
We are also seeing the ramifications of 'don't worry it always goes up' and out of control entitlement programs that didn't exist when taxes were much much higher.
This is more than municipal and state jobs. This goes to basic services including law enforcement. States and municipalities are about get hit really hard when real property starts being reassessed lower because of real estate prices including commercial.
I agree about raising taxes but now is not the time - we need counter cyclical measures right now.
We are seeing the ramifications of "tax cuts ALL the time every time".
RebelCapitalist.com - Financial Information for the Rest of Us.
Citi was bailed out in the early ninties on the QT at the time and they have never been the picture of health.
I have a picture of them partying in their corporate tower while a lowly gas company employee is turning the gas off in the basement because Citi can't pay the bill as the mailman passes him carrying notices to several million citi card holders that their rates are being increased to 60% because, well no reason given.
They should have been seized by the FDIC last fall. We have protected the wealthy shareholders at the expense of taxpayers and the overall health of our economy now dependent on zombie banks.
So we'll be left with a huge federal tax bill to maintain employment for state workers? This is just a regurgitation of the stimulus package which is targeted at keeping a specific group of people employed while sending the bill to everyone.
At some point this putting off till tomorrow what we can do today way of doing things has to end.
If the politicians do not have the cohones to raise taxes back to where they were before Reagan then we have to cut entitlement programs and on the state level cut employment. My state gives a 3% annual cost of living increase for all retirees and doesn't tax state pensions either. I can't get that in my business because someone has to pay the bills.
We cannot have our cake (supporting entitlement programs, bailing out the financial system and maintaining high government employment levels with golden retirements) and eat it too (lowering taxes for the wealthy)- something has to give.
My state like Illinois has also put off payments on their pension funds in order to balance budgets. Its going to catch up on us. Its catching up to us right now.
Oregon has ballot measures, 66, 67 to raise taxes. The problem is they are misrepresenting the taxes, even in the ballot pamphlet.
It took me forever to figure this out. They are literally taxing gross receipts, i.e. gross income, i.e. gross sales.
So, if a business does $500k in sales, regardless if their operating costs are $1 M, they are going to get taxed.
i.e. taxed even with a $500k yearly loss.
I swear to God, do Democrats know how to screw something up or what? They didn't bother to just close the loopholes which enables corporations to write off things that shouldn't be written off to avoid taxes, esp. using other state and national tax codes to do it...
they didn't bother to really analyze the state corporate tax code...
nope, they did this, which of course is going to shut down a host of small businesses who hire workers.
This is with around a 11% unemployment rate.
BTW: this is why all corporate tax codes tax net, not gross....because of course all businesses have major expenses, operating costs ....like salaries, wages, benefits, retirement they must pay for and so no one in their right mind would want to tax those because if a business has problems and doesn't turn a profit, they now have an additional tax liability on top of things.
Honestly, I didn't believe it and normally never listen to those "anti-tax" rants and I think everyone on this site knows I've been pro a host of new tax innovations....
but this is just stuck on stupid.
It's no wonder to me voters keep flipping parties since neither one can do anything that makes plain common sense.
On this one, I had to go dig out the actual legislation and it took forever to analyze for I couldn't believe someone would put together a tax that was so obviously detrimental to job growth and small business.
Interesting idea:
RebelCapitalist.com - Financial Information for the Rest of Us.
Good deal! I'm trying to get these code modifications done, I keep having to deal with other stuff, to get the site upgraded.
People are complaining and rightly so, on the CAPTCHA, and a huge part of the upgrade is better security that isn't so obnoxious!
So, ya all, if you're in the mood to write up blog posts, Instapopulists, now is the time for myself, I've got a pipeline and each one takes a good 3 hours of research to be worth a damn, really behind in the queue!
Also, Rebel, the reason I give you so much $hit on "Progressive" is we're really linked into the economics blog communities and also to not "turn off" someone to read the post details due to political labels. i.e. they see political terms instead of the plain good ole fashioned ripoff details and kind of just bypass the post due to association with political terminology instead of economic terminology or "rip off info" terminology.
Hope that makes it more clear as to why I'm pinging on political labeling.
Instead of "class warfare" it is truly a war over economic policy. Monetarism and neo-liberalism is great for certain groups including corporations (and those who control them). The foundation or logic behind neo-liberalism is a re-direction of income from low & middle income families to corporations and upper class.
As for Ayn Rand, it is scary and too many people truly don't understand it. Objectivism is a utopian society and it runs contrary to our Constitution. Objectivism and libertarianism may work if everyone were equal and had the same opportunities. We are far from that.
RebelCapitalist.com - Financial Information for the Rest of Us.
Thanks for that excellent addendum. And great remark on Iceland. I was pointed in that direction by Prof. Michael Hudson (who, along with Steve Keen, and the last decade or so, Paul Craig Roberts, has been correct in all his long-term macroeconomic pronouncements, as well as always getting those piddling details correct).
In looking at Iceland, and more so deeply due to that Norwegian-French lady magistrate who has been investigating their banking practices, the entire government and banking system appears to have been highly, highly securitized. They truly bought into the securitization/credit derivatives scam in a major way.
Regarding Milton Friedman, I will never, ever comprehend who anyone regards him as anything other than a looney tunes. Everything he ever commented on (OK, one exception about those central bankers not being reliable) was so truly bizarre, as well as the fact he never walked his talk (everyone else should exist in a "right-to-be-immediately terminated" status, except him, who had tenure).
What's even worse, his ignorance on the mitigating factors of the Great Depression. Anyone who professes to be an economics or economic history scholar of that period, yet doesn't grasp the importance of securitization back then leading up to the Great Crash of '29, is strictly out to lunch.
The sad thing about the American public today is that sales of books written by Ayn Rand have really exploded recently! During the Great Depression at least a large number of Americans had a grasp on what was taking place; today far too many are oblivious, befuddled and can't even begin to understand who their enemy is in this scenario!
Viva Tanta !!
http://www.calculatedriskblog.com/2008/12/in-memoriam-doris-tanta-dungey...
Basically we are "the people", therefore Populist is whatever we say it is! ;)
Officially it's a "catch all" which is another reason to grab it.
Populism usually means the majority of the people want something and also yes, there are a few trying to co-opt the term but it's really from way back in the early part of this century, last part about 1896 and this was kind of a similar movement to the Progressive moments of that time, i.e. TR, etc.
But you're right and "Populism" has been used for about every movement that was an upstart or not the establishment, including some pretty scary ones.
But officially it's a "by the people" sort of deal and since EP is a non-partisan, anyone can write as long as they have their facts on straight and are cited, credible....kind of fit.
Also picked it so people would feel free to buck whatever the party line was if it didn't make a lot of economic sense.
Some would argue that tea-bagger movement is a populist movement.
RebelCapitalist.com - Financial Information for the Rest of Us.
What matters are the policies and actions.
In regards to trade, the problem we have is HOW we engaged globalization not whether to engage or not. Isolation would be crazy but unfettered "free trade" is also crazy.
RebelCapitalist.com - Financial Information for the Rest of Us.
That's pretty damn vague frankly. One can claim some policy is "opportunity" when in reality it's a disaster. Take joining the WTO as an example...that was sold on a host of so called "progressive" values and look at the results.
This is a primary point of EP....I should add it to the FAQ...no vague adjectives allowed. ;) Seriously, how many times have the American people be sold some corporate lobbyists' wet dream on some nice sounding claims?
The point of EP is to get to the real statistics and details and this is why....trojan horses. Unless one digs in deep, you do not realize what's really going on.
I know I'm giving you a hard time, but this is seriously important. I cannot tell how many times I've seen something labeled as "fill in the blank" political flavor to look at the details and realize it was policy which would significantly hurt the U.S. national economic interest, middle class, American workers and so on.
Even some of my favorite blow hards have their weaknesses on some policy areas.
Speaking of this, I noticed HuffPo has Pat Choate on the business blog columnists, which is good. I believe Choate is either an ind. or even possibly a conservative...
but on economics, he's got some of the best statistics I have seen to date, which is probably how he got a column.
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