Economist Christina Romer serves up dismal news at her farewell luncheon
Economist Christina Romer serves up dismal news at her farewell luncheon
Christina Romer, chairman of President Obama's Council of Economic Advisers, was giving what was billed as her "valedictory" before she returns to teach at Berkeley, and she used the swan song to establish four points, each more unnerving than the last:
She had no idea how bad the economic collapse would be. She still doesn't understand exactly why it was so bad. The response to the collapse was inadequate. And she doesn't have much of an idea about how to fix things.
What she did have was a binder full of scary descriptions and warnings, offered with a perma-smile and singsong delivery: "Terrible recession. . . . Incredibly searing. . . . Dramatically below trend. . . . Suffering terribly. . . . Risk of making high unemployment permanent. . . . Economic nightmare."
Anybody want dessert?
If this is who is running our country, we should be really, really scared.
She had no idea how bad the economic collapse would be
The economic collapse will be really bad... possibly ending like the Weimar Republic because the system is designed to fail, utterly. It's only a matter of time before the props are seen for what they are.
The exponential is exponential
She still doesn't understand exactly why it was so bad
This is easy. The US monetary system is a ponzi scheme and the value is being called upon at a time when we need it but they have stolen.
The response to the collapse was inadequate. And she doesn't have much of an idea about how to fix things.
Correct and, wow, she's an idiot. Anything short of bringing our monetary in line with our Constitution is inadequate. This means getting rid of the privately owned and operated Federal Reserve and, short of amending the Constitution, returning to the gold standard. I am a fan of amending but it also needs to be a properly designed monetary system where money is value instead of being debt with interest rates. Debt is not money and we currently are treating it like money.
This time it won't be the same.
Hard-nosed Fed sends global markets reeling
Hard-nosed Fed sends global markets reeling
More ominously, some Fed officials fear the central bank is already "pushing on a string" and does not have the means to revive the economy. Whether or not they are right, this comes as a psychological shock for investors schooled by the "Greenspan Put' into thinking that there is a deus ex machina in the wings.
What goes up must go down... especially in a world being depleted of resources faster than ever.
Goldman Sachs said the yen was now overvalued by 20pc, or two "standard deviations" out of kilter
This is the most interesting aspect of this article. This implies that Goldman's algorithms for calculating prices aren't working any more. This has several very important meanings.
- The High Frequency Trading Algorithms used by the banks aren't or can't take into account macro economic trends.
- Their algorithms are much less effective at controlling the market now.
- Most importantly, the markets have broken out of long and old trading patterns.
Add in that their algorithms have known bugs or purposeful defects, as was demonstrated by the Flash Crash, and this is a recipe for disaster. Now, anything could happen.
Here is a good example of the problem:Demonstrating An HFT Algo Gone Apeshit
Well, today we just experienced another mini flash crash, after some algo went apeshit and decided to hit every bid on the way down, all the way to 0.0001 (gotta love that sub penny quoting just above zero). Below we show how this algorithm pushed the stock price of Core Molding from its normal price of $4.12 all the way down to $0.0001 in the span of one second, after an HFT program went ballistic, and would have kept on hitting the subpenny $0.0001 bid in perpetuity. It must have been swell to be a CMT holder: one second your stock is worth $4.12, the next, it is worth $0.0001 (and no, not $0.0000, how else will the computers game the NBBO in subpenny increments).
Corporations were Never People
Can we stop them now? The case just needs to be completely read through by the Supreme Court and all the logic built upon that what people think of as that case can be thrown out.
Toll privatization bill in Michigan gives more than just revenue to corporations
This bill is designed to cover a systemic revenue shortfall in Michigan. It's only a temporary fix that removes more long term revenue due to more restrictive intra-state travel and really makes the employment prospects in Michigan worse.
It should be killed on economic grounds alone. Just wait and see what the employment numbers in Michigan do when that money is sucked out of the state economy to feed the national and international money vampires.
Reposted from qbit.cc:
Toll privatization scheme in Michigan HB 4961 amounts to a tax paid directly to private corporations, without representation
Update (May 26/ 2010 7pm) This bill has passed the house, 56-51 and is going to the Senate.
Michigan House Bill 4961 [pdf] boils down to Taxation without Representation – turning the State’s right to levy taxes over to private international corporations, essentially ceding sovereignty over critial infrastructure. The corporations will be able to levy highway tolls without oversight or regulation on US citizens, should this bill pass.
At an absolute minimum it allows the creation of a single high occupancy toll lane. After the next repaving of an entire highway, tolls can be collected on all lanes.
Now that the financial elite have tanked our economy, they’re trying to buy up our infrastructure and property using their international corporations that operate above the law.
Some important exerpts from the bill:
… to abolish the office of state highway commissioner and the commissioner’s advisory board and to transfer their powers and duties…
TO PROVIDE FOR PUBLIC-PRIVATE TRANSPORTATION FACILITIES; TO AUTHORIZE PUBLIC-PRIVATE AGREEMENTS RELATING TO … TOLLING, OPERATING, OR MAINTAINING A PUBLIC-PRIVATE TRANSPORTATION FACILITY
[allow private corporation to tax the use of public "transportation facilities" ... but what constitutes a transportation facility?]
“TRANSPORTATION FACILITY” MEANS ANY NEW OR EXISTING HIGHWAY, ROAD, BRIDGE, TUNNEL, OVERPASS, RAMP, INTERCHANGE, FERRY, AIRPORT, VEHICLE PARKING FACILITY, VEHICLE TRANSPORTATION FACILITY, PORT FACILITY, LOCKS FACILITY, RAIL FACILITY, INTERMODAL OR OTHER PUBLIC TRANSIT FACILITY, OR ANY OTHER EQUIPMENT, ROLLING STOCK, SITE, OR FACILITY USED IN THE TRANSPORTATION OF PERSONS, GOODS, SUBSTANCES, VEHICLES, …
[Wait for it, wait ....]
INFORMATION, OR MATTER OF ANY KIND…
[data cables are included in "transportation facilities?!" This bill would allow sale and private taxation of network (internet/data) infrastructure as a "transportation facility" based on "congestion." Data cables are already leased by big cable/telcos so what does this mean for them?]
… INCLUDING THE SALE OF REVENUE BONDS …
[turn the business holdings into a fiat financial market; enable fractional lending based on expected future revenue, destabilizing the business]
…
“INSTRUMENTALITY OF GOVERNMENT” MEANS A LEGAL PUBLIC ENTITY CREATED OR EMPOWERED TO CARRY OUT FUNCTIONS COMMONLY CARRIED OUT BY UNITS OF GOVERNMENT
…
THE AGREEMENT SHALL PROVIDE THAT THE OWNERSHIP OF A TRANSPORTATION FACILITY WITHIN THIS STATE SHALL BE VESTED IN AN INSTRUMENTALITY OF GOVERNMENT AND THAT TITLE TO THE TRANSPORTATION FACILITY SHALL NOT BE ENCUMBERED
[the corporation will have complete "unencumbered" control]
…
NO PROVISION OF A PUBLIC-PRIVATE AGREEMENT SHALL ALLOW THE PUBLIC TO BE DEPRIVED OF THE USE AND BENEFIT OF A TRANSPORTATION FACILITY EXCEPT AS NECESSARY TO IMPLEMENT TOLLS OR OTHER CHARGES …
[the corporation has the authority to deny access if you don't pay the toll]
A TOLL MAY BE IMPOSED ON A HIGHWAY ONLY IF IMPOSED FOR THE USE OF NEW HIGHWAYS, OR THE USE OF EXPANDED HIGHWAY CAPACITY BEYOND HIGHWAY CAPACITY IN PLACE ON THE EFFECTIVE DATE OF THE AMENDATORY ACT THAT ADDED THIS SECTION.
[tolls may be levied for any expansion or heavy traffic (?)]
TOLLS AND OTHER CHARGES IMPOSED FOR THE USE OF A TRANSPORTATION FACILITY ARE NOT SUBJECT TO REGULATION BY ANY OTHER GOVERNMENTAL AGENCY.
[the tolling will not be regulated by the government]
NOTHING IN THIS SECTION SHALL BE CONSTRUED TO ALLOW THE CONVERSION OF ANY NONTOLL OR NONUSER-FEE LANES EXISTING ON THE EFFECTIVE DATE … WITH THE EXCEPTION OF A HIGH-OCCUPANCY VEHICLE LANE THAT MAY BE OPERATED AS A HIGH-OCCUPANCY TOLL LANE FOR VEHICLES NOT OTHERWISE MEETING THE REQUIREMENTS FOR USE OF THAT LANE.
At a minimum, if this passes, the corporation(s) will create high occupancy toll lanes. Initially this allows them to just take one lane and turn it into a private toll lane. If we let this pass, how easy will it be to expand it to 2 “managed lanes,” or 3, or the whole highway?
When the highway needs repaving, will the private company dictate who gets the contracts? And how do we select which private company gets to take control in the first place? Well, anything goes according to this:
ANY COMPETITIVE SELECTION PROCESS THAT THE DEPARTMENT DETERMINES TO BE APPROPRIATE OR REASONABLE … USING A COMPETITIVE SELECTION PROCESS WHEN TO THE EXTENT PRACTICABLE
….
INFORMATION SUBMITTED UNDER SUCH A PROMISE OF CONFIDENTIALITY SHALL NOT BE SUBJECT TO DISCLOSURE UNDER THE FREEDOM OF INFORMATION ACT
[The bidding process will be competative to the extent that the government determines is "reasonable," but you'll never know because whatever we say is "private negotiations" will be exempt from FOIA requests]
A newer version of the bill (pdf) has been released that is substantially the same but provides for “public hearings” to receive user input; amounting to no real oversight or accountability.
THE COMMISSION SHALL CONDUCT A PUBLIC HEARING AT LEAST ONCE EVERY 5 YEARS TO RECEIVE PUBLIC COMMENT AND INPUT WITH REGARD TO THEN EXISTING PUBLIC TRANSPORTATION FACILITIES ….
After the next repaving, all highway lanes can be turned into toll lanes. Signing this bill will inevitably turn our Michigan highways into private revenue streams for multinational corporations, not to mention ports, rail, and network infrastructure. This is infrastructure we’ve already paid to build, and need to maintain ourselves in order to sustain the local economy by hiring local workers and companies.
People from Michigan, it is absolutely critical that we reject this bill. We can not let them hand our infrastructure over to international corporations as many other states have. In the long run Michigan will lose on this deal in a big way.
They mean business and will do whatever is necessary including paying off our elected officials. Call your representatives and let them know we’re watching!
- – - – - – - – - – - – -
From MI Rep Paul Opsommer:
OUT-OF-STATE MEDDLING WORSENS HB 4961
May 24, 2010
State Rep. Paul Opsommer today criticized Canadian and Ohio officials for pushing legislation that would allow the Michigan Department of Transportation to toll virtually anywhere in Michigan.
“At the end of the day, whose law is this anyway?” asked Opsommer, R-Dewitt. “Canada’s understandable need to be part of border discussions is now being eclipsed by their off-base efforts to support the Ontario pension fund, and now we have resolutions being introduced involving the Ohio Legislature as well. If we pass laws in Michigan that give MDOT unilateral tolling power in our state it should be because that is what the Michigan Legislature feels is right, not because of pressure from other states or countries.”
Opsommer made his comments in response to a recent news story that officials in Ohio are advocating for their resolution SR 223 in support of the Detroit River International Crossing. The bill in Michigan that would allow for that, HB 4961, would also give new power to MDOT at the expense of the Legislature. HB 4961 is also criticized for allowing “instrumentalities of government” from other countries and states to enter into contracts that could potentially determine the tolling rates and eminent domain decisions taking place in Michigan.
“It has been a conscious decision by MDOT to wrap the DRIC bridge up into broad public-private partnership legislation that would not only allow for the DRIC but would cause the Legislature to give up its authority to statutorily authorize tolling anywhere else in the state,” Opsommer said. “I don’t know if this is because the governor wants to use the bill as leverage to keep Canada happy with the DRIC, or if she simply wants to have the unilateral ability to impose tolls on taxpayers with no other checks and balances, but either way it’s wrong.”
The Ambassador Bridge, Blue-Water Bridge and all other tolled facilities in Michigan received their tolling authority through stand alone bills authorized by the Legislature. Opsommer cited a recent letter from the attorney general’s office that concurs that MDOT currently only has the ability to toll where the Legislature has given its formal approval.
“Whether tolling is done directly by MDOT or a private contractor, you want someone who has been elected by the people determining where to use that tool,” Opsommer said. “In cases where it is being done by a private contractor who is using toll rates not just to break even but also to create profits, I would think you would want to keep voter accountability even more. If toll rates go unfairly through the roof, who are taxpayers supposed to turn too? The Legislature will be powerless at that point; it would actually be players from outside of the state who would have the final word.”
Opsommer also pointed to international pressure from Canada as having an unfair influence on the process.
“If it wasn’t for the fact that the main potential investor in all of this, the Ontario pension fund OMERS, was recently granted expanded powers by the Canadian government to provide investment management services I am not sure we would even be here,” Opsommer said. “We shouldn’t be making decisions on tolling Michigan taxpayers based off of the financial needs and a quest for high returns by a Canadian pension fund. The DRIC and HB 4961 should be treated as two entirely separate issues.”
The National Motorists Association has endorsed a substitute version of HB 4961 that would ensure the Michigan Legislature still retained its tolling authority over MDOT and other instrumentalities of government from outside of the state.
“It is essential to not pass any version which does not provide for specific legislative approval for any public-private partnership that will involve direct tolling for the users,” said Jim Walker of the National Motorist’s Association. “Should the H-6 unfortunately pass in the House, I hope the Senate will have the courage to fix this issue.”
Oliver Stone’s Wall Street sequel
'Wall Street' sequel is an omen of U.S. collapse
So, Just like Michael Moore's Capitalism: A Love Story, Oliver Stone has lost focus on the individual: What you can do in your own life to at least try to combat these evil forces. There are two kinds of actions to be taking right now.
- Corrective Actions to change society so it doesn't happen
- Damage Control Actions to minimize your own risk should something happen
The problem isn't capitalism. Capitalism is actually a very fine system. It works wonders when it is actually real. Our system we have today is not capitalism: it's fascism. It's government for and by corporations. banks and large corporations have so much power that they have taken over. They can manipulate markets and governments and thus you and me. So the question is, how many of the problems does Stone touch upon? The banks? monetary policy? constitutionality? capitalism? corporatism? cronie-democracy? the one party system (Republicrats)? fascism?
The Federal Government is way way out of line. They have taken so much liberty when the founders of the nation intended the Federal Government to be extremely limited and have each state govern itself.
The Federal Deficit vs. The Federal Reserve
I'd like to point out the EXTREME conflict of interest that Congress has with the Federal Reserve. The Federal Reserve directly or indirectly is funding a great part of the Federal Deficit authorized by Congress. Thus, until the Federal Deficit is wiped out we are holden to our Providers. Congress "can't" audit the Federal Reserve because they need the Federal Reserve.
Here is the kicker. Congress doesn't need the Federal Reserve for money. They have the Constitutional Power to create it themselves. Switching the system would be too disruptive to the powers that fund the Senators.
So they won't. So sad.
Keiser Report №17: Markets! Finance! Scandal!
We've been at financial war with China for many, many years. No one talks about the Chinese only letting us go through the kindness of their communist heart. At some point China is going start selling their worthless dollars, which will show just how little they are actually worth.
It's amazing that Goldman Sacks PROFITED from the hiding the Greek debt through derivatives and manipulating market prices. This only shows that derivatives really should be regulated. How exactly I don't know but maybe putting a cap on a derivative at $100 million would be a good idea. If banks move off shore to do this business so be it, would that put enough distance to be safe should the speculation hysteria burst?
I couldn't agree more with Keiser. The sooner and faster, the better. The more we delay the harder it will be. And there are some significant changes needed. Fiat money needs to go which is going to change a lot of things. But this is the only way to actually fix things.
If we don't fix this problem, then the banks will take everything because we all are using their future money which we need to pay back. The system is designed to make people fall off because not enough value has been, or ever could be, created to pay off their debt money with interest.
This is not a system of stable value. More money must be created to support the base of money in existence, with interest. This is an ever growing problem because the value represented by the dollar, the economy, needs to keep pace in order to stabilize the value. For decades they've created a little more money than created in the economy but now the economy has no more steam and cannot continue growing except through the shadow banking economy to which we are not allowed access. There has been extraordinary market distortions since the creation of the Federal Reserve and fiat money. That whole big mess needs to unwind before we get back on a sustainable track. This means a lot of changes which could be a complete mess if not actually planned by the government.
Not only that, but let me remind you that fiat money in the USA is actually unconstitutional.
Debt is everywhere because it is what we use as money! If you have money, it is really possessing other people's debts which they have to get back from you because, ultimately, it must go back to the bank with interest. We are literally slaves to our money system. Wasn't slavery made unconstitutional at some point?
The odd thing is that the money you do have usually lives at the bank. If you read the fine print of a new account document you'll see that it is really a loan to the bank. In exchange you get numbers in an account and the ability to (hopefully) get it back at some point in the future. Alas, they use this money as reserves to create new money and perpetuate the system.