Friday, August 30, 2013

Home Buyers Using All Cash Hits All Time High

So says the National Association of Realtors, here:

Walt Molony, a spokesman for the National Association of Realtors, says that the association’s estimates of the share of the market made up by all-cash buyers are lower than the others, at 31% in July, but that they’re still at an all-time high. ... Molony says that investors make up 35% of all-cash buyers (70% of all investors pay cash), while retirees who’ve built up equity in their homes or paid off their mortgages account for 12%. The rest include vacation-home buyers and foreign buyers.

Thursday, August 29, 2013

Obama's Appallingly Bad GDP Reports For The Last 3 Quarters Average +1.23%

Revised GDP Q2 2013 was reported this morning UP at 2.5% from 1.7%. Q1 remains at 1.1% and Q4 2012 remains at 0.1%

Truly abysmal figures, despite the revision.

The news release from the BEA is here:

Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 2.5 percent in the second quarter of 2013 (that is, from the first quarter to the second quarter), according to the "second" estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP increased 1.1 percent.

The GDP estimate released today is based on more complete source data than were available for the "advance" estimate issued last month. In the advance estimate, the increase in real GDP was 1.7 percent. With this second estimate for the second quarter, the increase in exports was larger than previously estimated, and the increase in imports was smaller than previously estimated (see "Revisions" on page 3).


A rate of 2.5% in Q2 is much better than 1.7% to be sure, but hardly commensurate with a recovery. The last three quarters now yield an average report of 1.23% instead of 0.97% prior to today's revised report. Woo Hoo! Compared to 2.8% for all of 2012, Obama's best year (cough), the 2013 figures which yield an average report of 1.8% to date are also appallingly bad.

This would be a good time for the president to begin doing his job, except he has no clue what it is. 

most recent quarterly figures
most recent annual figures

Ironman Arrives At The Same Conclusion Reached By The True Born Sons Of Liberty

TARP is fascism
At Real Clear Markets, here:

The United States would appear to be well on its way to adopting fascist Italy's political-economic system, favoring the politically-connected while starving entrepreneurs out of the economy. Although today in America, we call it "crony capitalism". And the people who practice it "progressives".

Do you think we should start calling it what it really is?


This blog was born of the observation here in 2009, and I think first used the term in the specifically financial sense involving not just banking, but housing, a year later, here. Since those days, however, we've decided England invented fascism long before Mussolini did and founded America on the principle, but the English undoubtedly got it from the great old Roman idea of the patron-client relationship.

Fiscal 2013 Spy Budget Just Under $53 Billion

The heretofore classified figure is now known because Edward Snowden gave it to The Washington Post, which has revealed here.

Previously the best estimate was about $75 billion.

Since 911 more than $500 billion has been spent according to the lengthy WaPo story. Peak spending on spying was in the 1980s at $71 billion in current dollars, according to WaPo.

Jobless Claims Now Average Below 300k For Three Straight Weeks, A New Record For Obama

First time claims for unemployment have never looked so good in 4.5 years under Obama. In the last three weeks not-seasonally-adjusted first time claims have averaged monthly under the 300k mark because claims in the last five weeks have consistently printed below that level. This week's average for four weeks beats last week's by 1000, setting a new record under Obama of 282k average first time claims weekly in the last four weeks.

If ever there were good conditions for adding to the employment rolls under this president, these are those. Sustained for a year, the current average would mean just 14.7 million first time claims per year, not-seasonally-adjusted, a low level on an annual basis not seen since the 20th century ended.

The report is here.

Wednesday, August 28, 2013

Is The Cost Of College Really Up 538% Since 1985? Or 53%?

Gold averaged $317/ounce in 1985. Today it's knocking on the door of $1,430, up 351%. But the cost of a college education is up 538% since then, according to this story from Bloomberg:

"[T]uition expenses have increased 538 percent in the 28-year period, compared with a 286 percent jump in medical costs and a 121 percent gain in the consumer price index. The ballooning charges have generated swelling demand for educational loans while threatening to make college unaffordable for domestic and international students."


I won't quibble about the inflation measure. I show the "all items" CPI July 1985/July 2013 up about 115%, but that just raises the question about what is the correct way to measure inflation.

Arguably the price of gold is the correct measure of inflation in the economy, not the CPI. And by that standard the cost of a college education has risen just 53% more than gold measured inflation has risen in 28 years, not 345% more, while medical costs have actually failed to keep up with inflation as measured by gold over the same period. Some maintain that most of the actual increased cost of college has to do with the increased costs of room and board, not with tuition. That seems entirely plausible. Tuition and fees where I went to school in 1985 are up 300% vs. 350% for gold.

People are finding college to be unaffordable in the same way that they are finding gold to be unaffordable. It's not that the prices are up. It's that the dollar has shrunk, the cruellest tax of all because it takes you 30 years to realize you've been robbed somewhere along the line, but just where you cannot tell.



We report, you decide.

Tuesday, August 27, 2013

The Real Fascist Threat To America Comes From The Left, But Only Because It Won

Dennis Prager, here:

[I]f there is a real fascist threat to America, it comes from the left, whose appetite for state power is essentially unlimited. But because the left has so long dominated American intellectual, academic, artistic, and media life, it has succeeded in implanting fear of the right. ... First, it does not mean, or have anything in common with, Nazism. Nazism may have been a form of fascism. But Nazism was a unique form of fascism and a unique evil. It was race-based and it was genocidal. No other expression of fascism was race-based. And not all fascism is genocidal. So my fear that the American left is moving America toward an expression of fascism in no way implies anything Nazi-like or genocidal. ... Second, it is not liberals or liberalism that presents a threat of fascism. It is the left. Liberals of the 1940s to 1970s such as John F. Kennedy, Harry Truman, Hubert Humphrey, Henry "Scoop" Jackson, Daniel Patrick Moynihan and so many others were not leftists. They were liberals.


I beg to differ in most of the particulars while seconding the main point.

The advent of fascist elements in American life specifically as a phenomenon of the left has gone hand in glove with the advance of liberalism under Wilson, FDR and Lyndon Johnson, in addition to the fact that the left won World War II, not the "right", whatever that is. One can hardly explain the growth of the state to its current proportions nor its growing oppressive reach without that liberalism and its spokesmen's early admiration for people like Mussolini, Hitler and Stalin. Nor can one explain our alliance with left socialism in joining the war on the side of Stalin apart from a natural affinity for that form of it as opposed to the other. "Fear of the right" is an artifact of the victory of Stalin and FDR over Hitler and Mussolini, but should more correctly be styled "fear of right socialism". 

Nor is it conceivable to imagine the rise of liberalism in America without the revolution in theology which immanentized the eschaton in the social gospel movement. For Marx religion may have been the opiate of the people, but to Spengler it was the very grandmother of Bolshevism. Russia and Germany went to war as developed rival socialisms while the majority of Americans resisted becoming involved in a fight where they had not yet a dog. They were still children in the classroom of The State. But now that we have grown up we routinely invade in the name of "freedom" because we have come to believe it is our destiny to impose it everywhere we can while ensuring cradle to grave security for one and all at home.

That's not to say America hasn't been fertile ground for fascism from the beginning, quite apart from the dominating influence of a psychology derived from Christianity and its tendency toward totalitarian-like moral conformity. But that involves the economic history, which Prager doesn't address. The contemporary corporatist model lauded by Wall Street has its roots planted comfortably deep in our origins in English colonialism, going all the way back to the crown's banking operations on behalf of the sea-trading companies. Many of the original American colonial charters were patterned on this model of state sponsorship and were first and foremost state-capitalist business ventures. So it should come as no surprise that American capitalism after independence has become more crony than capitalist as it has gotten so very long in the tooth. You can take the Tory out of England, but you can't take the England out of the Tory. Jeffrey Immelt of GE in his admiration for the Chicoms is no different than Henry Ford in his for Hitler.

Lastly, it is troubling to me that a person such as Dennis Prager, who is a student of communism, doesn't mention the fundamental bloodthirstiness inherent in all socialisms, whether communist or fascist. The "unique" evil of Nazism shouldn't blind us to Stalin's anti-German crimes anymore than it should blind us to Stalin's crimes against Ukraine and the millions "disappeared" during his purges. And where is the serious reflection on left socialism's responsibility for the many millions of Chinese who perished at the hands of Mao, who specifically imitated Stalin? And perhaps more to the point for us, the fact that as fascist socialism advances in America millions of unborn children have paid and continue to pay everyday the price for it, all in the name of "freedom"?

Monday, August 26, 2013

Unlike Past Identifiable Tyrants, Today's Monsters Are Faceless Multinationals

So says Andrea Lunardelli, quoted here at

"It's history, not propaganda," Andrea Lunardelli insisted during an interview on a warm August morning in his family's modest wine cellar where a lone employee was busy attaching labels — Hitler giving the Nazi salute; a portrait of Hitler with his autograph; another portrait with the motto "Ein Volk, ein Reich, ein Führer" (one people, one nation, one leader) — on bottles waiting to be boxed and shipped. ... Bottles with labels from what Mr. Lunardelli, the son of the company owner, Alessandro Lunardelli, describes as the "historical line of products" occupied a shelf on a wall. The discriminating buyer could choose among Mussolini, Lenin and Stalin, indicating that when it comes to despots, Lunardelli wines are equal-opportunity merchandizers. ... These products "are a way of not forgetting history and the monsters it produced, ensuring that they never return," he said. At least the past had identifiable tyrants, he added. "Today's monsters are faceless multinationals." ... Only Che Guevara popped corks when it came to leftist figures. ... Nazi bottles, he acknowledged, are among the company's best sellers. "Eighty percent of the sales are Hitler," he said, or around 20,000 bottles a year, about a quarter of Lunardelli's total production, which consists mostly of table wines using local variety grapes. ... Despite years of complaints about his labels, Mr. Lunardelli pointed out that the law was on his side. Several lawsuits and investigations by public prosecutors have failed to prove in court that the wines are an apologia for fascism or Nazism, which is against the law in Italy.

Obama Draws A Red Line In Syria

Saturday, August 24, 2013

Miles Traveled In June 2013 Show This Is Still A Depression

Miles traveled in June 2013 remain mired at levels first reached in 2004-2005. This is not the result of improved fuel economy! People just travel less by car than they used to, for the obvious reasons: unemployment, high gasoline prices, auto repossession and voluntary cuts to personal spending.

You can believe the propaganda, or the facts on the ground which show that America ain't what it used to be, under Obama. He calls it transformation. He never said it would be good, did he? You just assumed so.

Read the report for yourself, here.

Mortgage Securitization Only Works At The Expense Of Taxpayers And Banks

So says Arnold Kling for The American, here, who provides a useful summary of crony capitalist rent-seeking since World War II:

At this point, all signs point to victory by two of the biggest culprits in the mortgage crisis — the mortgage bankers (firms that originate loans to distribute, not to hold) and the Wall Street investment banks. Both depend on securitization if they are to participate in the mortgage lending process. However, securitization has only been able to compete with traditional bank lending when securities are backed by guarantees from the taxpayers and when bank capital requirements punish banks that hold their own loans.


Arnold Kling is otherwise famous for his firm grasp of the obvious: "Most home owners are not libertarians."

Friday, August 23, 2013

Once Again, It's The Banks Doing The Money Printing, And The Bubble Blowing, Not The Feds

Jeffrey Snider, here:

That is not to say that paper dollars are issued by banks; they are not. Paper currency still takes the form of Federal Reserve Notes, but in the marginal monetary and banking system they are largely irrelevant. Dollars in the banking system, what is called liquidity, are created and dispersed by bank balance sheet accounting. These marginal liquidity units are digital representations of currency, ledger balances that shift daily, even by the minute. Bankruptcy and insolvency are not when you run out of Federal Reserve Notes in your bank vault, they come when you have to settle your accounts with the liquidity provider and there are no positive numbers on the right side of the computerized ledger (or when your ledger does not match your counterparty's, and that counterparty happens to be JP Morgan).

Given that global banks are the primary "money printers" in the dollar trade system (and the dollar swap standard), the Fed's role under interest rate targeting is to backstop the wholesale money markets where banks obtain short-term funding from each other. The implicit promise of interest rate targeting had been enough for the global dollar fraction to expand through accounting, regulatory and derivative leverage, providing the financing for the myriad bubbles of recent decades. The Fed did not create the bubbles directly, just provided the conditions for banks to do it for them.

Thursday, August 22, 2013

Actually Obama's Been This Way Since He Was 25, Not 52

Don't you find that comforting knowing his finger is on the nuclear button?

To Hell With Negotiation: ObamaCare Wasn't Passed In A Bipartisan Manner, So Why Should Defunding It Be?

No Negotiation!
The Democrats held the country hostage to pass ObamaCare, so there's nothing to holding it hostage to defund it, especially since a clear majority doesn't want ObamaCare.

Erick Erickson here:

I have no fall back plan. Defunding Obamacare is not a starting position for negotiation. The Democrats did not negotiate with the American public before subjecting them to this law. I see no reason to negotiate now. The GOP has the power to defund Obamacare and if the Democrats do not agree, it is on them. ... The Democratic Party of the United States and the President himself were willing to sacrifice their majority in order to foist Obamacare on an unwilling populace. If the GOP is not willing to stake its position on repeal of a law most Americans oppose, that makes the Democrats far braver.

Al Gore's Latest Loose Screw Safely Removed From The Roadway By WaPo

To think this guy could have been president, or that some think he would have been an improvement over George W. Bush.

Story in The Washington Post, here.

Real Median Income Falls 4.4% Under Obama, 6% Since 2007

You talkin' to me?
Way to go, Brownie!

Story here:

The median, or midpoint, income in June 2013 was $52,098. That's down from $54,478 in June 2009, when the recession officially ended. And it's below the $55,480 that the median household took in when the recession began in December 2007. The report says nearly every group is worse off than four years ago, except for those 65 to 74.


"It is also advantageous for a tyranny that all those who are under it should be oppressed with poverty, that they may not be able to compose a guard; and that, being employed in procuring their daily bread, they may have no leisure to conspire against their tyrants." -- Aristotle, Politics

Fewest Ever Lose Their Jobs Under Obama In Last Month

First time claims for unemployment have hit a new low under Obama this week. For four weeks in a row initial claims in the not-seasonally-adjusted category have come in well below the 300,000 mark, averaging just over 283,000 per week in the last month. That's the first time that's ever happened under Obama. The seasonally-adjusted figure completely misses the fact and is nearly 17% worse.

If kept up for a year 283k/week would be the equivalent of 14.7 million first time claims for unemployment. Under George W. Bush the actual annual level never got below 16 million.

You could hardly ask for better conditions under which to add jobs, if there were any to add.

In 2011 Head Of FISA Court Ruled NSA Had Already Lied To It Three Times

No wonder Snowden got fed up and blew the whistle.

The New York Times reports here:

The Justice Department had told Judge Bates that N.S.A. officials had discovered that the program had also been gathering domestic messages for three years. Judge Bates found that the agency had violated the Constitution and declared the problems part of a pattern of misrepresentation by agency officials in submissions to the secret court. ... “The court is troubled that the government’s revelations regarding N.S.A.’s acquisition of Internet transactions mark the third instance in less than three years in which the government has disclosed a substantial misrepresentation regarding the scope of a major collection program,” Judge Bates wrote.

Wednesday, August 21, 2013

350 Radioactive Water Storage Tanks At Fukushima Have Rubber Seals, Not Welded, Just Like The One That's Leaking

There's a line in Heartbreak Ridge which updates snafu. That's Fukushima, except there's nothing normal about pools of leaking radioactive water throwing off 100 millisieverts per hour. 

Story here, by Fukushima Diary, and here by the BBC, which regrettably didn't put Mochizuki on the radio.

Hillary Has More Sooty Baggage Than A 90-Car Freight Train

So says Camille Paglia, here:
'It remains baffling how anyone would think that Hillary Clinton (born the same year as me) is our party’s best chance. She has more sooty baggage than a 90-car freight train. And what exactly has she ever accomplished — beyond bullishly covering for her philandering husband? She’s certainly busy, busy and ever on the move — with the tunnel-vision workaholism of someone trying to blot out uncomfortable private thoughts. I for one think it was a very big deal that our ambassador was murdered in Benghazi.'In saying “I take responsibility” for it as secretary of state, Hillary should have resigned immediately. The weak response by the Obama administration to that tragedy has given a huge opening to Republicans in the next presidential election. The impression has been amply given that Benghazi was treated as a public relations matter to massage rather than as the major and outrageous attack on the U.S. that it was. Throughout history, ambassadors have always been symbolic incarnations of the sovereignty of their nations and the dignity of their leaders. It’s even a key motif in “King Lear.” As far as I’m concerned, Hillary disqualified herself for the presidency in that fist-pounding moment at a congressional hearing when she said, “What difference does it make what we knew and when we knew it, Senator?” Democrats have got to shake off the Clinton albatross and find new blood.'

Tuesday, August 20, 2013

Detained In London Limbo Land, David Miranda Didn't Have The Right To Remain Silent

Glenn Greenwald's "wife" detained to intimidate him

As explained here in the UK Guardian:

The reality about schedule 7 of the 2000 [British terrorism] act is that it is a legal power tailored to the half-world of ports and airports. It gives police powers to do things to people in that half-world that they could not do in the real one. In the real world, legal checks and balances apply – in America, ironically, some of these go under the name of "Miranda rights". In the half-world, people can be held and questioned, searches carried out and property confiscated without particular suspicion or legal safeguards. There were 69,000 such stops last year, only a handful of which led to arrests.

And here:

"They even asked me about the protests in Brazil, why people were unhappy and who I knew in the government," said Miranda. He got his first drink – from a Coke machine in the corridor – after eight hours [of detention and interrogation] and was eventually released almost an hour later. Police records show he had been held from 08.05 to 17.00. Unable immediately to find a flight for him back to Rio, Miranda says the Heathrow police then escorted him to passport control so he could enter Britain and wait there. "It was ridiculous," he said. "First they treat me like a terrorist suspect. Then they are ready to release me in the UK."

Monday, August 19, 2013

Sen. McCain Couldn't Find His Own Ass With Both Hands. Neither Could USA Today.

From the most ridiculous editorial about NSA abuses I've read yet, here, in USA Today Away, quoting the senator whom that dope Sarah Palin helped reelect:

"[W]e need more congressional oversight. We need more information."

You mean from Senator Feinstein who is in charge of the oversight in the Senate, who never even had the May 2012 NSA internal audit detailing its own abuses, let alone read it?

Both senators belong in a retirement community, far away from Washington, D.C., reading lifetime subscriptions to that birdcage liner.

UK PM Cameron Joins United Stasi Of America, Tells UK Guardian To Destroy Snowden Files

The Financial Times has the story, here:

"[I]f the material was not handed over or destroyed, the government would try to stop the Guardian’s reporting through a legal route."

30 seconds of truth

Kim Dotcom punks the US Embassy in Berlin July 2013

Sunday, August 18, 2013

TBSOL: McCain Has No Credibility In The American World

(seen at Drudge)

Under Harry Truman Federal Spending Was Slashed More Than Two Thirds

Between fiscal years 1945 and 1948 inclusive federal spending declined 67.85%, from $92.7 billion in 1945 to $29.8 billion in 1948. By the end of fiscal 1952 spending increased back up to $67.7 billion, but still 27% lower than in 1945.

Real GDP declined 9.4% from January 1945 to January 1949, but rebounded 28% by the time he left office four years later.

Who says we can't cut the size of government dramatically and still grow like gangbusters?

Saturday, August 17, 2013

Kudlow Is Right That Obama's Glorious Immediate Post-War Never Existed, But Completely Misses The Spending Cut Angle

Larry Kudlow, here:

[S]peaking in Galesburg, Ill., this summer, Obama served up a convenient historical fairy tale: "In the period after world War II," he said, "a growing middle class was the engine of our prosperity." Presumably he was thinking of a time when high taxes on the rich and industrial-union rule had the middle class soaring. The trouble is, Obama's history is wrong.


Arguably, government spending cuts were the engine of post-war prosperity.

While Truman's record is second only to JFK/LBJ for real GDP growth in the post-war period, it occurred under special circumstances of extraordinarily deep government spending CUTS, which is little appreciated today when politicians and Keynesian and monetarist economists stress the importance of government spending for GDP. The truly remarkable thing under Truman is how the economy soared as spending decreased by TWO THIRDS from 1945 to 1947, as Arnold Kling reminded us here last year. Funny how Kudlow doesn't mention this. I guess they don't teach that at Princeton.

Under Truman's successor Eisenhower, real GDP growth slowed dramatically because of onerous levels of taxation maintained primarily to retire the war debts, but Eisenhower spent almost as frugally as Truman at the same time, making them the two best presidents we've had when it comes to small increases in the US public debt. That said, only the two Bush presidents and Obama have turned in poorer GDP performances than IKE. Funny also how Kudlow mentions only the one Bush. He leaves out the other one. You know, the "read my lips . . . no new taxes" Bush who ended up raising taxes.

Interestingly enough for US public debt growth, JFK/LBJ come in right behind Truman and Eisenhower while introducing the tax cuts which might have made Eisenhower's GDP record better than it was. Despite the guns and butter era under LBJ, the presidents occupying The White House between 1945 and 1968 were the most fiscally responsible we've had in the post-war, and it was a dramatic resetting of the baseline for spending LOWER under Truman which was the foundation of that period's economic growth.

Sen. Diane Feinstein, Washed-Up Geezer, Thinks NSA Oversight Means Overlooking It

Senator Dianne Emiel Goldman Berman Feinstein Blum, I think
Senator Diane Feinstein (D-CA) is supposed to be leading the oversight of the NSA in the Congress, but to her "oversight" means something more like ignoring it. Easy to do during naps.

Conor Friedersdorf for The Atlantic reports here:

The [Washington Post] got its hands on the [internal May 2012 NSA] audit -- more than a year after the fact -- before she did! And the trend? "Despite the quadrupling of the NSA's oversight staff after a series of significant violations in 2009," [Barton] Gellman reports [link added], "the rate of infractions increased throughout 2011 and early 2012."

Friday, August 16, 2013

ObamaMan Spooks "Bill And Hillary Clinton" On SNL Halloween Party In 2007

Video here.

Only we can mock ourselves.

The Immorality Of Keynesianism Explained In A Thought Experiment

From the conclusion of Jeffrey Dorfman for Forbes, here:

"Actions by private individuals that are not beneficial to society do not suddenly become so when the government does them. Ask yourself if government policies [of printing money and income redistribution from the rich to the poor through the tax code] would be legal and have a positive effect if a private citizen did the same thing [by counterfeiting money and robbing banks]. If the answer is no, using government to accomplish the same aims will not change the policy into a good one."

Bernanke's Crime Against The Elderly: He's Cut Their Income 88%

From Kermit Zieg for The Washington Post, here:

The major architect of the recovery of the past five years has been the Federal Reserve System. ... Everyone seemed to win, but that’s not so. Retirees were badly hurt — devastated, in fact. They have not benefited from lower mortgage rates because their homes generally are paid off. They are not in the stock market because of the volatility. They primarily live on savings and the interest earned on these savings. Ten years ago, a retiree could have earned $40,000 annually on $1 million of savings in a bank. Today, that same $1 million would be lucky to earn $5,000 yearly. If a retirement lifestyle was built on expectations of $40,000 in annual interest income and the reality today is $5,000, the improving economy has no relevance. Economic survival in a low-interest-rate market is the focus for retirees.


It is always the defenseless who are the first to go under the bus in this country: unborn children, the unemployed and the old.

Thursday, August 15, 2013

Who's The Conservative? Rush Limbaugh Or The Prophet Jeremiah?

Now, Steve Jobs' version of what [Ashton] Kutcher said in the last sound bite was this: "Your time is limited, so don't waste it living someone else's life. Don't be trapped by dogma -- which is living with the results of other people's thinking. Don't let the noise of others' opinions drown out your own inner voice." Don't let other people talk you out of believing in yourself.  Don't let other people talk you out of believing that what you want to do is valid and good and worthwhile. Don't let other people's structure and formula make you feel second-rate or inconsequential. "And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary."

He said just have the courage, believe and think for yourself, live for yourself. And he's also saying something there that is really true. Your heart will never lie to you.  Your head will all day long, but your heart won't. Steve Jobs said that when you grow up, you tend to get told the world's the way it is and that your life has to be lived inside that world. Try not to get into too much trouble. Get an education, get a job, make some money, have a family, but don't make waves. And Jobs said, to hell with that. Make waves. Everybody else made waves. Change the world.

-- Rush Limbaugh, yesterday here

The heart is deceitful above all things, and desperately corrupt; who can understand it? "I the LORD search the mind and try the heart, to give to every man according to his ways, according to the fruit of his doings."

-- Jeremiah 17:9f.

Jobless Claims Average Plummets Below 300k For First Time Under Obama

First time claims for unemployment, not-seasonally-adjusted, have now averaged just under 298,000 per week in the last four weeks, the first time that's happened under Obama. Today's weekly report of 280,502 is the third in a row below 300,000 and only the fifth time in 4.5 years under Obama that weekly first time claims have been under that level.

The report is here.

The seasonally-adjusted figure at 332,000 doesn't quite capture the current facts on the ground and exaggerates what's going on by over 11% in the latest report. Even so, annualized we're looking at between 15.5 million claims per year to 17.2 million in the last month, conditions which should make it possible to make real improvements in hiring. Under George Bush claims never got below 16.2 million per year.

But there appears to be no driver for jobs anywhere in this depressed economy, just a driver for a golf ball in the hands of the president.

Wednesday, August 14, 2013

My Bazooms Are Bigger Than Hillary's

Sen. Amy Klobuchar (D-MN) is headed to Iowa

Ben Bernanke Is A World Class Thief And Should Be In Jail

The average annual return to cash for the three years since July 2010 has been 0.04%, for example in VMMXX, Vanguard's Prime Money Market Fund, but over that three year period inflation has absolutely raged at 7.18% overall, with the all items CPI soaring to 232.944 from 217.329. With about $10 trillion stuffed away in M2, returns to cash just keeping pace with inflation would have come to $718 billion to savers by now. Instead they've reaped just $4 billion (annually).

In a related note here, the contribution to GDP over the period from the Zero Interest Rate Policy and Quantitative Easing has mirrored the criminal returns to cash:

'But it turns out that the benefits of printing all that new money may have been negligible. According to a new study by two senior US economists, America's second programme of quantitative easing, nicknamed "QE2", boosted economic output by just 0.04pc.'

The rich have gotten richer the old fashioned way: they've stolen it.

Tuesday, August 13, 2013

Senator Rubio Fears Executive Orders Instead Of Fighting Them

He looks to his right, but to us it's left.
Sen. Rubio continues with his mission of disappointing the country and disappointing conservatives, here, expressly ceding his legislative authority to the executive:

“I have been saying now for over a year I believe that this president tempted, will be tempted, if nothing happens in Congress he will be tempted, to issue an executive order like he did for the DREAM Act kids a year ago, where he basically legalizes 11 million people by the sign of a pen,” Rubio said. ... “But we can’t leave it, in my mind, the way it is, because a year from now we could find ourselves with all 11 million people here legally through an executive order from the president, but no E-Verify, no border security, no more border agents — none of the other reforms that we desperately need.”

Bank Robberies: 2003-2011

We just had a bank robbery at a nearby bank this afternoon. The mope who did it is pictured at the left.

You would be wrong if you thought bank robberies are up because of the Obama depression. They are broadly down since 2003, almost 33%.



OK, there was a big spike up in 2008, but still nowhere near the 7556 in 2004.

It's kind of counter-intuitive. People rob banks 'cause that's where the money is. People had more money before the Obama depression. But after all the bank failures there were fewer banks and less money around, right? The FDIC had to come up with $88 billion to bail out all the failures. Anyway, it's still profitable to rob banks. Bank robbers get away with tens of millions every year, even now. That's why they do it.

(Data is from the FBI, here)

Present Savings To Business Of 5.5 Million Fewer Full Time Jobs

There are presently just under 118 million who work usually full time. In 2007 at the peak there were just over 123 million working full time. The difference is over 5.5 million.

Imagine all those workers not making the median salary from 2011, which was almost $27,000 per year. Or imagine all those workers not making the average salary from 2011, which was just over $41,000 per year.

The annual savings to business today in compensation alone because all those people are not working is somewhere between $149 billion and $228 billion. Add in the cost of benefits for each employee and then multiply by about six and you'll understand one of the reasons why stocks of businesses have done so well under Obama.

Flashback To January 2012: ObamaCare's "Not Worth Getting Angry About"

4th Delay Of ObamaCare Provisions Revealed By The New York Times

The case builds for dropping insurance coverage altogether. Its basic cost only soars, and what it covers only plummets. That was the whole point behind ObamaCare, to completely wreck the free market in health insurance, and the entrepreneurs at the heart of it providing the healthcare, the doctors. 

Tip of the hat to Avik Roy of Forbes, here:
"According to the law, the limits on out-of-pocket costs for 2014 were $6,350 for individual policies and $12,700 for family ones. But in February, the Department of Labor published a little-noticed rule delaying the cap until 2015. The delay was described yesterday by Robert Pear in the New York Times."

Monday, August 12, 2013

Economic Stress: Top 10 Selling Cars In July All Get Combined 28-32 MPG

The top 10 selling cars in July 2013 all get a combined MPG between 28 and 32 in their four-cylinder offerings with automatic transmission. In June most consumer spending was on autos and gasoline, and when those were backed-out, remaining retail was actually down 0.1%, the first time in a year. Soaring gasoline prices have no doubt been at work in spending allocated to more fuel efficient vehicles. Gasoline has been averaging above $3.50/gallon nationally since the beginning of February. See Good Car Bad Car here for car sales data by month.

Toyota Camry 28 mpg
Honda Civic    32
Honda Accord 30
Nissan Altima  31
Chevy Cruze    30
Toyota Corolla 29
Hyundai Elantra 32
Ford Fusion (fwd) 28
Hyundai Sonata  28
Ford Focus          31

To Fix The Mortgage Market, Pay Wholesalers And Brokers Over Time, Not Up Front

So suggests Jeffrey Dorfman, here:

"If we want to avoid a repeat of the recent mortgage market meltdown, we would be wise to reform the incentive structure in the mortgage industry. No government regulation is needed to accomplish this. Wholesalers can change the way they pay brokers and investors can require wholesalers to keep some skin in the game by taking at least some of their profits over time along with the investors. Spreading payments over even as little as three to five years would significantly change the incentives.

"If wholesalers and brokers got paid only if the mortgage borrowers made their payments, I suspect that we would have fewer mortgages with repayment problems."

Sunday, August 11, 2013

Real 10-Year Cost Of Being In Cash

With an average annual return of 1.77% in the last 10 years, July 2003 to July 2013, the cost of being in cash in VMMXX comes down to the inflation-adjusted return because inflation has averaged in excess of the nominal returns to cash: 2.43% annually over the period. That results in an average annual real return of -0.644% in cash. Ouch. By contrast, the real rate of return of the S&P500 has been +4.63% annually June 2003-June 2013, dividends fully reinvested. Going back 38 years to the inception date of VMMXX, 6-4-1975, the S&P500 has returned a real rate of 6.83% per annum. Cash has returned a nominal 5.58%, but with inflation averaging 3.95%, the real rate of return in cash has been just 1.568% per annum since 1975.

Your Real Return In Stocks Since 2000? Just 0.32% Per Year!

Sad, but true.

Check for yourself, here.

Friday, August 9, 2013

The Bernank Bombs The Buck

US Dollar Currency Index watchers have been reaching for the gin in recent weeks:

This was supposed to be a summer when the U.S. dollar would stand tall, pumped up by higher interest rates and the prospect of an improving economy.

But instead it's been sagging, with the dollar index losing 3.6 percent to 81.02 since July 10. On that day, Fed Chairman Ben Bernanke clarified the Fed's intentions about what it means to 'taper' its $85 billion a month in bond purchases. He emphasized that even with paring back of bond buying, the Fed would take its time pulling back from easing, and it has no plans to raise short term rates any time soon.

Read the rest from Patti Domm at CNBC here.

Thursday, August 8, 2013

Obama Can See The Gulf Of Mexico From Three Atlantic Ocean Ports

The world's smartest president strikes again:

"If we don't deepen our ports all along the Gulf — places like Charleston, S.C., or Savannah, Ga., or Jacksonville, Fla. — if we don't do that, these ships are going to go someplace else and we'll lose jobs," Obama said.

Video and story here (AP dishonestly added the "(and in)" to the quotation above before the word "places").

Affirmative action in editing.

Wednesday, August 7, 2013

Mark Levin Only Just Discovers TSA VIPR Program Tonight

Mark Levin's recent discovery of TSA VIPR operations reinforces his interpretation of the developing police state, but it's just old news to us.

Welcome anyway, Mark.

40 Million In Individual And Small Group Health Plans Will Be Hit Hardest By ObamaCare

McClatchy reported here in June:

Those two coverage areas – the individual and small group markets – face the biggest rule and cost changes next year, when the main provisions of the Affordable Care Act finally kick in. ... About 24.5 million people have small-group coverage through companies with 50 or fewer employees, according to federal estimates. Just 15.4 million people purchase individual coverage, according to the nonpartisan Kaiser Family Foundation, a nonprofit health care research center.

Learn more at

Conservatives Have Completely Dismissed Sen. Marco Rubio And Rep. Paul Ryan

Poll at

Tuesday, August 6, 2013

Long Term Care Insurance Getting Harder To Get As Firms Exit The Business

So reported CNBC here last week:

Three major plan providers, Metlife, Prudential and Unum, have stopped selling individual policies within the last three years.

"Companies have had a very difficult time hitting profit objectives," said Marc Cohen, chief research and development officer at insurer LifePlans. "Many of the assumptions underlying the pricing of these policies didn't hold true."

Among the assumptions firms made when they began selling plans in the 1990s was that policyholders would let their coverage lapse at about the same rate they do life insurance products. The lapse rate for long-term care has proven to be much lower. Policyholders who buy coverage during their senior years tend to hold onto their coverage and collect on their claims.

"The largest claim that's still open is from a woman," said Slome. "She's been on claim for 15 years. Her insurance policy has paid out one point $8 million to date and it continues to pay. She only paid $881 for three years before her claim began."

The industry has responded to that kind of bad underwriting by tightening qualifications for the coverage, setting caps on benefits and raising prices.

With 76 million baby boomers reaching retirement age over the next decade, the need for long-term care services is expected to surge.

Economic Distress: Average Age Of American Car Climbs To 11.4 Years From 9.9 In 2006

Story here.

Total Public Debt Outstanding Stuck At $16.738 Trillion For Over Two Months

The normal explanation for this would be that redemptions of Treasury securities are running at precise equilibrium with issues, which might imply there has been a big shift away from note and bond purchases by the public since the end of May when Ben Bernanke first floated the possibility of a tapering of Fed purchases in the secondary market. Bond outflows in June of nearly $62 billion dramatically reversed a trend (albeit declining) of purchases in 2013 through May.

Theoretically total public debt outstanding occasionally goes down in the rare cases when redemptions exceed issuances, but the maintenance of a consistent level equilibrium is indicative of a deliberate policy, that is, a policy not to exceed the debt limit of $16.7 trillion. This is effected by recourse to extraordinary measures on the part of the US Treasury Dept.

Tax revenues are also running higher in 2013, helping remove pressure from the situation as is the sequester which is curbing outlays. Revenue has also increased from the GSEs, in excess of $59 billion according to Reuters, here. The Associated Press has reported here for July 18th that the current fiscal year deficit is projected to come in over $300 billion less than last year when all is said and done.

Now you know why Congress felt it could take the traditional August recess without doing anything about the debt ceiling. They'll just let Jack Lew sweat it out.

Monday, August 5, 2013

The Kookiest Jobs Story In Months: Republican House Ways And Means Tallies Just 270k Full-Time Since 1-09

Story here.

What's next, 911 really was an inside job? Paul McCartney did die?

To believe this number you have to believe all the numbers reported all the time by the Bureau of Labor Statistics have been wrong for 4.5 years and that everyone who works there is content to keep a secret, and can, but I'll bet you those are precisely the numbers House Ways and Means have been "crunching" to arrive at the "truth". 

I realize John Crudele at The New York Post is fond of that skeptical pose now that a former BLS official has been talking to him about his skepticism about the numbers, but really, have we all gone off the deep end in order to drive home a political point about what ObamaCare is going to do to the nature of work in America when it's not really yet self-evident? For example, average hourly earnings should be plummeting if Ways and Means is right, but they are not. Wages are up nearly 1.9% in the last year. Nothing to write home about, but completely dispositive of the thesis.

As usual the devil is in the details, which in this case means the word "net", as in net total. Well, net from what benchmark? The all-time high of full-time at 123.219 million under George Bush? Full-time isn't anywhere near recovering to that level, so it's impossible that for the Republicans net means net above the all-time high by the paltry sum of 270,000, as in 123.489 million full-time jobs. Would that the Republicans were right!

Alas, they are not. Usually full-time is presently 117.688 million, 3.873 million above the January 2009 level when Obama took office, not 0.270 million above the January 2009 level. That's the nominal number. Doug Short at Advisor Perspectives could run the population-adjusted figures for us to show us just how far behind we really are in recovering to trendline at the Bush peak. Population has continued to grow causing employment-population ratios to plummet and labor participation rates to tank under truly dismal GDP conditions, so there is value in looking at it from that perspective. It's true. Obama is a total failure at job creation. When he turns his gaze to them, they seem to vaporize. Rush Limbaugh thinks this is on purpose.

Meanwhile the numbers continue to improve because this is a giant capitalist ship with tremendous inertia whose communist captain can't turn her on a dime for another go at the iceberg. He wishes we were China, but we aren't.

God bless the Republican House, but get off the number-of-angels-on-the-head-of-a-pin stuff. It's August, and we have gin to drink.

US Marine Helps Flagging 9-Year Old In 5k Finish Race: "Will You Run With Me?"

The United States Marines, America's finest.

Story here.

Colorado Democrat Faces Recall After Narrow Victory Courtesy Of Libertarian Spoiler

Ross Kaminsky has the story in The American Spectator, here:

Forty-five miles north, Senate President John Morse is in even bigger trouble. Although his senate district includes the quirky (and liberal) town of Manitou Springs, John Morse won his 2010 election by only 252 votes in a race in which a Libertarian candidate won five times that number. In other words, if not for the presence of a third party candidate, Mr. Morse would likely have lost; this is not a safe “blue” seat, despite redistricting since 2010 having made the district lean slightly more Democratic than its prior configuration. ... [P]erhaps most galling, even to Morse’s liberal constituents, were comments he made on MSNBC’s Rachel Maddow show in which he proudly said (while claiming the mantle of Abraham Lincoln) that he counseled fellow Democrat senators to avoid reading e-mails from constituents. To be fair, Morse probably assumed that nobody was watching the show.

"The current state of valuation is as clear as a bell. We're not cheap here."

Joshua Brown, here, who notes that value investors are raising cash:

"In the meantime, many famous value managers are husbanding their cash - either because they can't find compelling values or because they foresee better opportunities ahead."

Sunday, August 4, 2013

Fox News Thinks Abu Ghraib Is In Afghanistan

How soon they forget.

They report, you decide.

Story here.

The Trend To Part Time Jobs Is A Myth, Otherwise Average Hourly Earnings Would Be Down

Earnings are up 1.87% in the last year

So says Jim O'Sullivan, here:

Jim O'Sullivan, chief U.S. economist of High Frequency Economics . . . is not convinced that part-time, low wage jobs are driving the nation's employment growth. Average hourly earnings most of this year have been rising about 2% at an annual rate, notwithstanding a slight dip in July. That's consistent with the rest of the four-year-old recovery. If low-wage jobs were growing much faster than other positions, they should be pulling down average wage growth, O'Sullivan says.


Not only are earnings up modestly year over year, the not-seasonally-adjusted figures for usually full time workers show a year over year increase of 1.55 million jobs, or 1.34%. Usually part time is up more, 1.59%, but that's only a net 430,000 workers.

Saturday, August 3, 2013

The Part-Timing Of America Has Been Slowing Down, Not Speeding Up

The part-timing of workers was a much more severe phenomenon from the 1960s . . . when teenagers used to bag groceries, for example.

That was a good thing. We should have more of it, not less.

Is it a coincidence that as the minimum wage rises over time part-timing decreases?


Usually Part Time Is Up Only 1.25 Million Since Obama Elected In 2008

That's a less than 5% increase in the size of this group over the period, and a less than 1% increase in usually part time compared to the total size of usually part and usually full time taken together in November 2008.