To make your way in the world today you are going to have to face up to the fact that you need to earn more money. Even if it is enough to pay your phone bill, your groceries and your fuel bills it is surely worth a small investment and a little bit of your time to go out and try something new. Remember, act now before it is too late. The world is changing and we are in a period of adjustment, you must do what you can now it could mean the difference between putting food on the table or not.
This would be the various corporate tax codes which enable the "stashing" of money offshore for tax purposes, the tax brackets, precisely how large corporations pay zero in taxes...
kind of the "big picture" stuff. I've read and written on a few of these in the past, but haven't done much recently. Frankly it's a job. It's like studying for a final exam to write up one blog post overviewing things and then trying to communicate your discoveries in one blog post when you just read 1000 pages.
Not an easy task.
I've thought of including Mish in the middle column, but I find so many posts kind of skewed with some sort of philosophy, i.e. philosophy trumps sanity.
Two things most Americans do not want to deal with...esp. taxes because most people cannot fill out 1040ez.
So, if you want to take it on, I'm sure we'll be most appreciative of a good detailed tax blog post on how these MNCs aren't even paying taxes to more how tax incentives do make a huge difference in what kinds of businesses and activities corporations will pursue.
I've tried to list a few blogs which specialize in solid tax code analysis and then the GAO frankly has some of the best material out there.
Here is something I've noticed. As more and more true policy experts, economists take to the Internets to gain awareness of their work, analysis, recommendations, I'm seeing these very ideas to start popping up into the MSM.
(Great Blog & Catch, BTW) Sure, we are in a decades-long deleveraging spiral, but again the tax structure is being decimated by the neolibs/neocons: around 80% of the American fed tax base derives from the individual taxpayers, whose fed revenues have plummeted by 21% -- corporate taxes ONLY make up about 7% to 7.5% of that remaining 20% and it has plummted down by 58%. (Still need to check on any changes in the normal 12% of expected taxes.) And since those bank stress tests were based upon something in the vicinity of 8% unemployment, we can expect more and more bank failures --- of the smaller variety which usually acts as the small business incubators (i.e., the major job creators).
Plus, with that declining tax base we have the US Congress which appears to want to levy a mandatory private insurance fee upon the citizenry --- together with their push to "revitalize" the securitization (read: ultraleveraging) industry of Wall Street with that carbon offset/carbon derivatives (cap-and-trade, originally supported by Geo. H.W. Bush and, I believe, was created within Enron) legislation which will probably push up commodities even more.
(The Chicago Cubs filing for bankruptcy? Now what president comes from that town?)
We seem determined to unlearn the lessons of history. Scores of banks failed in the Great Depression as a result of unsound banking practices, and their failure only deepened the crisis. Glass-Steagall was intended to protect our financial system by insulating commercial banking from other forms of risk. It was designed to prevent a handful of powerful financial conglomerates from holding the rest of the economy hostage. Glass-Steagall was one of several stabilizers designed to keep that from ever happening again, and until very recently it was very successful.
Senator Paul Wellstone (D-MN)
Jobs offshoring, the neverending bailout of the banksters (securitization and derivates scamming and ultraleveraging) and leveraged buyouts by the private equity vultures: resulting in destroyed companies and ongoing unemployment --- the Unholy Trinity of our collective demise.
May the ghost of Ebeneezer Scrooge look after all those debt-financed billionaires this Holiday Season.
[Nomi Prins' It Takes a Pillage, easily the best of all the economic meltdown explanation (truly covers all points honestly) to hit the market -- highly recommended.]
That's a bummer the New York Times hasn't found the advertising revenue ability of embedded videos, like the dailyshow has because that's literally a documentary online.
Private equity was a big controversy in the 1980's. Oliver Stone's "Wall Street" firm touched upon it and how they use financial games, controlling interest and now this...debt loads to make profits while destroying corporations which add to the real economy and U.S. middle class.
Going through the history of this and what percentage is going on today in terms of corporate destruction would make an exceptional blog post.
If I recall right, a lot of politics at the time, the 80's talking about stopping these corporate raiders from doing these things and like most things in the national interest...
any legislation died in committee.
It goes through how it pays for a private equity firm to take a successful business load it down with debt, and then offload it. These guys trade firms like baseball cards, because each time they make a deal they get a cut.
What's really bad to think about is what happens if these funds are in the "winding up" stage in which they need to get out of investments, and there's no one there to buy the firms up because the private equity market has dried up. That means a new rash of firms that go into bankruptcy.......
The middle column isn't set in stone as well. I just added them. These are blogs which have fast moving content, they write daily and also usually write added insight into various MSM topics and/or original analysis from first principles.
I agree, I've been checking out zero hedge a lot lately, they seem so have some sort of inside track somewhere that appears no where else.
oops, on a sudden dollar collapse, I don't think it will happen but I also believed a total financial Armageddon won't happen (and in fact did not happen, but was a "disaster capitalism" moment) ...I'm a firm believer in the long dark slide to 3rd world status.
What is it about oil that is so hard to understand? It is a completely renewable resource--there will be plenty more in a few million years.
I predict the article is right on track, and rather than a "decrease in global demand" what you are really saying is "decrease in the rate of increase of global demand".
Let us face the situation: we are going to hit this oil crunch at full speed. Our oil addiction, at this point, will have to be broken cold turkey. The withdrawls will be painful.
What we can do about it now is find ways to reward sustainability and long term thinking. We can do it.
But I am still wondering about the (and I guess we're back to that black swan thing again) possibility of a sudden debt default/collapse of the dollar, as in a few weeks.
Unless you are predicting a complete seizing up of the entire world's credit markets, I don't see that happening. A friend once told me that you should never underestimate the ability of the ruling elite to manage a crisis.
Notice he didn't say "fix a crisis", just "manage" it.
OTOH, ZeroHedge (who is becoming one of my favorite bloggers) noticed an interesting little tidbit from the Fed's foreign currency reserves.
Yes, the Fed has foreign currency reserves too. They just never needed them before.
The big question mark at the end of August is when the U.S. International Reserve Position increased by almost 50%. The reason for this: a near quintupling of S.D.R. holdings on the U.S. balance sheet in the span of one week - from August 21 to August 28.
...
By purchasing $40 billion in SDRs virtually overnight, what the Fed has done is to increase the value of the entire basket pro-rata, while in the process reducing the actual value of the dollar (which is a weighted constituent of the SDR basket). This was an operation to reduce the dollar's value: pure and simple. In many ways it explains why the DXY has continued its straight one way decline since the beginning of September, when many pundits assumed the market was finally going to tank on profit taking after Labor day. By performing this dollar adverse transaction, the Fed sent a loud and clear signal what the Fed was going to do going forward vis-a-vis the i) dollar and ii) its derivative, the stock market.
And what is worse, this is not a roundabout or circuitous way of devaluing the dollar: this is head on intervention. It is one thing to print trillions of MBS and Agencies and to monetize Treasuries, where one could say Tim Geithner's claim that the U.S. is for a strong dollar, and the dollar is only weak as a function of supporting housing prices. That could potentially fly as an explanation. However, when the Fed is actively and purposefully destroying the dollar's worth via transactions such as material SDR purchases, then it truly demonstrates Geithner's statement as an bold faced lie to the American public.
Strange sh*t like this provides a field-day for konspiracy-minded people like myself. It makes a person ask questions like: "Just what in the Hell is going on?"
I think its already time for me to write another article about the dollar.
Official attempts to re-inflate the property bubble aren't limited to America. The U.K. government is doing it too.
(Bloomberg) -- Stuart Heathcote and his wife never intended to buy a house this year. Then the U.K. government offered an incentive that changed their minds: a no-money-down mortgage.
...
Easy credit is back in the U.K., and this time the government and homebuilders are making the loans. Seeking to recover from the worst recession in a generation, Britain is helping as many as 10,000 buyers obtain 100 percent financing through a 300-million-pound plan called HomeBuy Direct at a time when mortgages are scarce and, according to Ernst & Young LLC, home prices will “stagnate” for at least two more years.
“It’s a catastrophe waiting to happen,” Robin Hardy, a homebuilding analyst at KBC Peel Hunt, said of the plan. “If the only way a certain bit of the market can work is to lend deposits, those people can’t afford a house. It’s being done for the industry and not for the first-time buyers.”
Do government's have any clue at all what makes an economy work?
esp. in comparisons to some political whatever stuff on some agenda to create a new international language whatever.
I mean seriously....if it's a trivial story, you can bet CNN will cover it, into the ground, on every show, 24/7 and if it has any meat in it...you can bet CNN will put on "experts" who get it usually completely wrong. (this is minus Lou Dobbs, although one suspects he is being muzzled, but he still manages to get some real economists on his show periodically, but he too is fallen into the CNN "noise machine" of useless, triviality and diversionary topics..
). Faux news? Let's not even go there. I might flip on Glenn Beck because I consider that a comedy show.
Take health care....ever see a story on CNN about what's actually in the bills and have that story be accurate? Nope, it's all about the polls and brew ha ha...i.e. the trivialities.
and my impression is they are playing the "save the dollar" to save their U.S. Treasuries and export driven mercantilism. (ooo, another blog post topic, it used to be China was the mythical magic 1.3B consumer market that in reality never materialized so now we can talk about the mythical magic American consumer market that is now living out of cardboard boxes and tent cities!)
But I am still wondering about the (and I guess we're back to that black swan thing again) possibility of a sudden debt default/collapse of the dollar, as in a few weeks.
I don't read Bonddad that much because the predictions are so plain wrong. What can I say.
Ok, I said it. I just scanned the HuffPo post.
Ok, the difference is they are trying to ignore the absolute numbers by claiming there are "trend lines" as if these trends are going to erase the 9.8% official unemployment rate or the number of people dropping off of the count because they are running out of benefits and cannot land a job.
So, one is "trend line" or slope and the other, which I believe myself, midtowng and others are focused on, is the absolute levels.
Also, on initial claims, well, the 4 week moving average is only 9k down, so I'll stick with those rate of change details...and one must realize that in 12/08, Q1 /09 we had a massive "trough" as in depression era level economic trough due to the financial crisis "shock". So, the reality is we are still in deep recession level initial unemployment claims....but if one compares that to the "depression era level unemployment cliff dive"...it looks good...
It's also not just another cyclical lagging indicator this time, as noted by Paul Krugman as well as Brad Delong and others, it's a coincident indicator, it's feeding back upon itself.
So back to Bonddad's graph and IMHO he's cherry pickin'.
Here is that graph with bars:
Now here is the same graph, with lines. Notice the down trend now exposed.
Now, here is that same nonfarm payroll data, graphed not in "rate of change" per month, but in absolute raw numbers (SA, I'm using the exact same economic metric in Bonddad's original graph).
See a "trend" in that last puppy? See employment rolls drop?
To me, someone is having "chart mania" trying to disprove the obvious....uh, unemployment is going to top 10% and those jobs are in deep doo doo. It would take job creation of 250k jobs per month for 5 years to get back to a 5% unemployment rate.
Need I say more? I think we have deep denial in some of certain people's posts trying to justify a wrong prediction, what can I say. Myself, I'm not so into predictions because I'm not that advanced, but I will claim this "V" that was predicted, well, it's now the time we would see evidence of that "V" recovery and very obviously it ain't here....so I would claim those predicting a "V" recovery should fess up and admit they missed it.
Sort of like the frog in the pot of boiling water. The dollar is going to be cooked very slowly, otherwise the working class will notice.
This all started in 2002, but is only slowly being noticed now. The frog is already half-cooked.
The deflation of assets is being offset by the devaluation of the currency. It keeps price deflation from setting in, sort of like what happened in Argentina on a smaller scale.
A recent CNN television broadcast gave the impression that Esperanto aims to be a single global language. The comparison was with a global reserve currency, instead of the US dollar.
See http://www.youtube.com/watch?v=ZpC8mPk4QBM
May I put the record straight? Esperanto intends to be an auxiliary language, or a second language for all.
To make your way in the world today you are going to have to face up to the fact that you need to earn more money. Even if it is enough to pay your phone bill, your groceries and your fuel bills it is surely worth a small investment and a little bit of your time to go out and try something new. Remember, act now before it is too late. The world is changing and we are in a period of adjustment, you must do what you can now it could mean the difference between putting food on the table or not.
You've got to check out this perspective over on Ritholtz's blog, Quarterly review and outlook, by Hoisington Investment Management.
focus in on debt, but he's making no bones about doom & gloom economic projections.
This would be the various corporate tax codes which enable the "stashing" of money offshore for tax purposes, the tax brackets, precisely how large corporations pay zero in taxes...
kind of the "big picture" stuff. I've read and written on a few of these in the past, but haven't done much recently. Frankly it's a job. It's like studying for a final exam to write up one blog post overviewing things and then trying to communicate your discoveries in one blog post when you just read 1000 pages.
Not an easy task.
I've thought of including Mish in the middle column, but I find so many posts kind of skewed with some sort of philosophy, i.e. philosophy trumps sanity.
..but I think old Mish, here, may have beaten me to it.
Two things most Americans do not want to deal with...esp. taxes because most people cannot fill out 1040ez.
So, if you want to take it on, I'm sure we'll be most appreciative of a good detailed tax blog post on how these MNCs aren't even paying taxes to more how tax incentives do make a huge difference in what kinds of businesses and activities corporations will pursue.
I've tried to list a few blogs which specialize in solid tax code analysis and then the GAO frankly has some of the best material out there.
Here is something I've noticed. As more and more true policy experts, economists take to the Internets to gain awareness of their work, analysis, recommendations, I'm seeing these very ideas to start popping up into the MSM.
Now if we could get Congress to pay attention. ;(
(Great Blog & Catch, BTW) Sure, we are in a decades-long deleveraging spiral, but again the tax structure is being decimated by the neolibs/neocons: around 80% of the American fed tax base derives from the individual taxpayers, whose fed revenues have plummeted by 21% -- corporate taxes ONLY make up about 7% to 7.5% of that remaining 20% and it has plummted down by 58%. (Still need to check on any changes in the normal 12% of expected taxes.) And since those bank stress tests were based upon something in the vicinity of 8% unemployment, we can expect more and more bank failures --- of the smaller variety which usually acts as the small business incubators (i.e., the major job creators).
Plus, with that declining tax base we have the US Congress which appears to want to levy a mandatory private insurance fee upon the citizenry --- together with their push to "revitalize" the securitization (read: ultraleveraging) industry of Wall Street with that carbon offset/carbon derivatives (cap-and-trade, originally supported by Geo. H.W. Bush and, I believe, was created within Enron) legislation which will probably push up commodities even more.
(The Chicago Cubs filing for bankruptcy? Now what president comes from that town?)
Recipe for disaster, anyone?
And to channel a great American from the grave:
Jobs offshoring, the neverending bailout of the banksters (securitization and derivates scamming and ultraleveraging) and leveraged buyouts by the private equity vultures: resulting in destroyed companies and ongoing unemployment --- the Unholy Trinity of our collective demise.
May the ghost of Ebeneezer Scrooge look after all those debt-financed billionaires this Holiday Season.
[Nomi Prins' It Takes a Pillage, easily the best of all the economic meltdown explanation (truly covers all points honestly) to hit the market -- highly recommended.]
That's a bummer the New York Times hasn't found the advertising revenue ability of embedded videos, like the dailyshow has because that's literally a documentary online.
Private equity was a big controversy in the 1980's. Oliver Stone's "Wall Street" firm touched upon it and how they use financial games, controlling interest and now this...debt loads to make profits while destroying corporations which add to the real economy and U.S. middle class.
Going through the history of this and what percentage is going on today in terms of corporate destruction would make an exceptional blog post.
If I recall right, a lot of politics at the time, the 80's talking about stopping these corporate raiders from doing these things and like most things in the national interest...
any legislation died in committee.
Glad to see the New York Times covering it.
Showdown IN Chicago
RebelCapitalist.com - Financial Information for the Rest of Us.
piece out.
It goes through how it pays for a private equity firm to take a successful business load it down with debt, and then offload it. These guys trade firms like baseball cards, because each time they make a deal they get a cut.
What's really bad to think about is what happens if these funds are in the "winding up" stage in which they need to get out of investments, and there's no one there to buy the firms up because the private equity market has dried up. That means a new rash of firms that go into bankruptcy.......
Congress is owned and the White House doesn't have the courage to make the necessary (or even propose)policy changes that would transform our economy.
RebelCapitalist.com - Financial Information for the Rest of Us.
The middle column isn't set in stone as well. I just added them. These are blogs which have fast moving content, they write daily and also usually write added insight into various MSM topics and/or original analysis from first principles.
I agree, I've been checking out zero hedge a lot lately, they seem so have some sort of inside track somewhere that appears no where else.
oops, on a sudden dollar collapse, I don't think it will happen but I also believed a total financial Armageddon won't happen (and in fact did not happen, but was a "disaster capitalism" moment) ...I'm a firm believer in the long dark slide to 3rd world status.
What is it about oil that is so hard to understand? It is a completely renewable resource--there will be plenty more in a few million years.
I predict the article is right on track, and rather than a "decrease in global demand" what you are really saying is "decrease in the rate of increase of global demand".
Let us face the situation: we are going to hit this oil crunch at full speed. Our oil addiction, at this point, will have to be broken cold turkey. The withdrawls will be painful.
What we can do about it now is find ways to reward sustainability and long term thinking. We can do it.
Unless you are predicting a complete seizing up of the entire world's credit markets, I don't see that happening. A friend once told me that you should never underestimate the ability of the ruling elite to manage a crisis.
Notice he didn't say "fix a crisis", just "manage" it.
OTOH, ZeroHedge (who is becoming one of my favorite bloggers) noticed an interesting little tidbit from the Fed's foreign currency reserves.
Yes, the Fed has foreign currency reserves too. They just never needed them before.
Strange sh*t like this provides a field-day for konspiracy-minded people like myself. It makes a person ask questions like: "Just what in the Hell is going on?"
I think its already time for me to write another article about the dollar.
Official attempts to re-inflate the property bubble aren't limited to America. The U.K. government is doing it too.
Do government's have any clue at all what makes an economy work?
esp. in comparisons to some political whatever stuff on some agenda to create a new international language whatever.
I mean seriously....if it's a trivial story, you can bet CNN will cover it, into the ground, on every show, 24/7 and if it has any meat in it...you can bet CNN will put on "experts" who get it usually completely wrong. (this is minus Lou Dobbs, although one suspects he is being muzzled, but he still manages to get some real economists on his show periodically, but he too is fallen into the CNN "noise machine" of useless, triviality and diversionary topics..
). Faux news? Let's not even go there. I might flip on Glenn Beck because I consider that a comedy show.
Take health care....ever see a story on CNN about what's actually in the bills and have that story be accurate? Nope, it's all about the polls and brew ha ha...i.e. the trivialities.
and my impression is they are playing the "save the dollar" to save their U.S. Treasuries and export driven mercantilism. (ooo, another blog post topic, it used to be China was the mythical magic 1.3B consumer market that in reality never materialized so now we can talk about the mythical magic American consumer market that is now living out of cardboard boxes and tent cities!)
But I am still wondering about the (and I guess we're back to that black swan thing again) possibility of a sudden debt default/collapse of the dollar, as in a few weeks.
I don't read Bonddad that much because the predictions are so plain wrong. What can I say.
Ok, I said it. I just scanned the HuffPo post.
Ok, the difference is they are trying to ignore the absolute numbers by claiming there are "trend lines" as if these trends are going to erase the 9.8% official unemployment rate or the number of people dropping off of the count because they are running out of benefits and cannot land a job.
So, one is "trend line" or slope and the other, which I believe myself, midtowng and others are focused on, is the absolute levels.
Also, on initial claims, well, the 4 week moving average is only 9k down, so I'll stick with those rate of change details...and one must realize that in 12/08, Q1 /09 we had a massive "trough" as in depression era level economic trough due to the financial crisis "shock". So, the reality is we are still in deep recession level initial unemployment claims....but if one compares that to the "depression era level unemployment cliff dive"...it looks good...
It's also not just another cyclical lagging indicator this time, as noted by Paul Krugman as well as Brad Delong and others, it's a coincident indicator, it's feeding back upon itself.
So back to Bonddad's graph and IMHO he's cherry pickin'.
Here is that graph with bars:
Now here is the same graph, with lines. Notice the down trend now exposed.
Now, here is that same nonfarm payroll data, graphed not in "rate of change" per month, but in absolute raw numbers (SA, I'm using the exact same economic metric in Bonddad's original graph).
See a "trend" in that last puppy? See employment rolls drop?
To me, someone is having "chart mania" trying to disprove the obvious....uh, unemployment is going to top 10% and those jobs are in deep doo doo. It would take job creation of 250k jobs per month for 5 years to get back to a 5% unemployment rate.
Need I say more? I think we have deep denial in some of certain people's posts trying to justify a wrong prediction, what can I say. Myself, I'm not so into predictions because I'm not that advanced, but I will claim this "V" that was predicted, well, it's now the time we would see evidence of that "V" recovery and very obviously it ain't here....so I would claim those predicting a "V" recovery should fess up and admit they missed it.
Sort of like the frog in the pot of boiling water. The dollar is going to be cooked very slowly, otherwise the working class will notice.
This all started in 2002, but is only slowly being noticed now. The frog is already half-cooked.
The deflation of assets is being offset by the devaluation of the currency. It keeps price deflation from setting in, sort of like what happened in Argentina on a smaller scale.
A recent CNN television broadcast gave the impression that Esperanto aims to be a single global language. The comparison was with a global reserve currency, instead of the US dollar.
See http://www.youtube.com/watch?v=ZpC8mPk4QBM
May I put the record straight? Esperanto intends to be an auxiliary language, or a second language for all.
Please see http://www.lernu.net for confirmation.
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