Four Republican Chump Senators Vote To Confirm Hagel

Story here:

The vote was 58-41, with four Republicans joining the Democrats in backing the contentious choice. Hagel's only GOP support came from former colleagues

Thad Cochran of Mississippi,

Dick Shelby of Alabama ...

Mike Johanns of Nebraska ... 

and Rand Paul of Kentucky. ...

[Other] Republicans ... challenged Hagel about a May 2012 study that he co-authored for the advocacy group Global Zero, which called for an 80 percent reduction of U.S. nuclear weapons and the eventual elimination of all the world's nuclear arms.

These men just voted to let a Republican take the blame for dismantling the American military.

They are not on our side.

Secretary Of State John Kerry Causes 11 Letter Pile-Up Between Kyrgyzstan And Kazakhstan, Causing Kyrzakhstan

The former senator from Massachusetts was not seriously injured in the accident, physically.

Story here.

h/t Chris

Retirement Investments Hit New High In Q3 2012: $19.4 Trillion

The Investment Company Institute has all the data, here.

The old high, before the financial crisis, was reached in 2007 at the level of $17.8 trillion. In 2008 the level of total retirement investments in all categories slipped to a total of $14.1 trillion, a decline of almost 21% as the stock market tanked.

By the end of 2010, however, all the losses were recouped as the level bested 2007 at $17.9 trillion. In 2011 the level climbed again, to $18.0 trillion.

The latest reading in Q3 2012 puts all retirement assets at $19.4 trillion, 9% higher than in 2007, not quite five years on.

The biggest pile of dough, $5.3 trillion, remains in Individual Retirement Accounts, followed by Defined Contribution Plans like 401k accounts, with $5.0 trillion.

Roughly 50% of the American population is not participating in this recovery of retirement accounts because they have nothing in stocks, which under Obama have posted their 4th best performance since World War Two. More precisely, the percentage is probably quite a bit higher than that since just 37% of the stock market is owned by "households", while banks own about 32% of the stock market, the two biggest players if "households" really meant retail investors like mom and pops. It doesn't. But that's another story.

h/t Bloomberg, RushLimbaugh

125 Million Americans Are "Close To The Edge Of Ruin"

Story here:

"Nearly a quarter, 24 percent, admit to having more debt on plastic than money in the bank, while 16 percent say they have neither credit card debt nor savings. That puts 40 percent of the population close to the edge of ruin while everyone else seems to be sitting pretty."

(The Three Stooges, "An Ache In Every Stake", 1941, here)

Obama Favors A Jim Crow Law

So says Dean Kalahar, here:

The precursor to the modern minimum wage law began in 1931 with the Davis Bacon Act; which allowed whites to discriminate against blacks in the workplace because it protected the wages of unionized white construction workers from competition with black workers. Stunningly, this remnant of Jim Crow is still on the books. The first federal minimum-wage law, the Fair Labor Standards Act, passed in 1938 under FDR.

Fast forward to today where President Obama asked for the minimum wage to be increased to $9.00 hour in his State of the Union Address. Let's get this straight; the first African American President of the United States advocates a Jim Crow law that increases unemployment to the very low skilled young minorities he claims he wants to help? When did a wage of zero become more of a "fair share" than a job and opportunity? That's just a shameful irony, Machiavellian politics, or shear [sic] ignorance.

Or maybe that's Obama's white half talking.

New York's Puritan Mayor Bans 2-Liter Pop With Pizza Deliveries

Story here.

It used to be conservatism and reaction which in 1950 were said not  to exist as real ideas but only as mere actions or irritable mental gestures. Now it's liberalism and progressivism occupying that role, but without actually resembling ideas. They represent emotions instead, usually of revulsion, especially for people who are fat, or of shame, especially for holding otherwise intelligent opinions critical of other people's culture, way of life and religion.

Rep. Justin Amash Is Poison For The GOP

Once again Rep. Justin Amash illustrates that he's not really a Republican. It's really hard to say what he is, actually. Who knows, maybe he's a Martian. His loyalties obviously lie elsewhere than with the Republican Party. Whatever he is, it's not a team player.

Consider that if it were really true, as he claims below, that the Republicans weren't really serious about any alternatives to the sequester, why would that be anything but good except for the political lying part, seeing that the sequester will force some real cuts to spending? I gather he's against those cuts because they aren't really real cuts because baseline budgeting increases spending automatically and we're just reducing the increase not the net spending year over year, or . . . they just aren't big enough cuts, kind of like voting to defund Planned Parenthood wasn't good enough because the bill didn't defund everyone like Planned Parenthood, so just vote to continue funding the nation's largest abortion provider. Interesting Republicanism.

Here he was at mlive: 

"They've been throwing this at the Democrats, saying we [Republicans] put two proposals on the table to replace the sequester," Amash told the gathering of 75-plus constituents at Gaines Township Hall. "No, we haven't."

The effect of this was nothing more than a poke in the eye to all Republicans, whom he'll never persuade if he keeps acting like that in public. God knows he'll never persuade Democrats in Congress. At some point you just have to shrug your shoulders at Rep. Justin Amash. He won't play nice and he can't persuade anybody, so . . .  what? We elected him so he could go to Washington and just play in the big Congressional sandbox?

Surely there's a good ole country boy up there somewhere on Capitol Hill who can talk some sense into the child. But somehow I think it's going to take more than talk to adjust his attitude.

The Banks Own 32% Of The Stock Market, Households 37%

This Bank of America chart from July 2012 seen here shows bank ownership of the equity markets at 32% in Q1 2012, a stunning number rivalling the household sector's share of 37%. In 1950 households (an elastic category including much more than simply retail investors) held roughly 90% of the market in their hands (admittedly far fewer retail investors than today, but that's another story).

So you've got to ask yourself why ultra cheap loans to banks by the Federal Reserve have gone into markets in such spectacular fashion? To help them recapitalize after the housing implosion, that's why. Banks can't make money the old fashioned way anymore because the owners' equity of household real estate of consumers is down to about 45% (it had sunk as low as 39% in 2010 and 2011), a decline of over 45% since 1950. Think cash-out-refis at artificially low interest rates and HELOCS and the housing market collapse. The banks are left holding the bag, or the Feds are, on 5 million repossessed properties in the last seven years, leaving a huge capital hole in their off-balance-sheet balance sheets. Having plundered John Q. Public by selling him the rope he hung himself with (HELOC reform 1986 Tax Reform, Taxpayer Relief Act of 1997 2-Year Rule on Sale of Principal Residence, Repeal of Glass-Steagall 1999), the government-banking cartel has had to look elsewhere for profits. They're finding them.

Care to buy stocks? 

Why The Shiller p/e Might Mean The Market Has Room To Run

The market might have room to run if excluding the bubble period from the calculation of the Shiller p/e is any guide.

So John Hussman, here:

"Excluding the bubble period since mid-1995, the average historical Shiller P/E has actually been less than 15."

That means the bubble period skews the calculation of today's historical average of 16.46 upward by something like 9%. So with a current Shiller p/e of 23.35 which looks backward incorporating bubble-era p/es into its calculation, a discount of 9% yields a truer Shiller p/e presently of something more like 21.25, which could mean there is still considerable upside potential in the market.

Today's Shiller p/e would have to rise to about 26.4 to reflect the old upper range redline of 24 identified by Hussman as a danger zone.

Interestingly, the March 1, 2009 Shiller p/e of 13.32 was therefore more like 12.1, quite the buying opportunity indeed, though nowhere near the 7 identified by Hussman as that rare thing marking the buying opportunity of a lifetime.

I wish I had had the courage to get in in March 2009. The real average annual rate of return in the S&P500 from then to January 2013 has been +19.14%, simply amazing. But as late as May 2010 people like Richard Russell were telling us to get out of debt and get completely liquid because technical analysis was predicting Armageddon was 6 months away. By August he had changed his tune.

Near term I am somewhat less pessimistic than I was, if only because a real blow-off top looks more definable than before. I'm still keeping my powder dry.

Paul Farrell's Latest AntiCapitalist Mess At MarketWatch Ridiculed Good

In the comments section, here.

"William Sisco" and "J.D." obviously know their stuff.

Buchanan's "The American Conservative" Isn't Conservative

Pat Buchanan's "The American Conservative" isn't a conservative magazine. It never has been, and isn't now. It's editor has endorsed Obama in 2008 and voted for him. That's when I stopped reading. For all I know, he voted for him in 2012.

Now the magazine publishes an article by Mormon Jon Huntsman, former governor of Utah and one time presidential candidate, advocating gay marriage. That makes perfect sense, since Mormons have never subscribed to Christian monogamy except by force of federal intervention. Yes, federal intervention. Utah statehood depended on Mormon renunciation of plural marriage at the dawn of the 20th century. Now here comes a Mormon telling us to redefine marriage once again.

Pat Buchanan should be ashamed of himself.

Ten Years of the Euro v. the Dollar: Up 25%

The Euro/Dollar has gone from 1.06 ten years ago to 1.32 today, up 24.5%, thanks in no small measure to the efforts of the Germanic north.

Forbes' Top 20 Most Miserable Metropolitan Cities For 2013

Here:

20. Youngstown, Ohio

19. Gary, Indiana

18. Poughkeepsie, New York

17. Cleveland, Ohio

16. Atlanta, Georgia

15. Atlantic City, New Jersey

14. Milwaukee, Wisconsin

13. Camden, New Jersey

12. St. Louis, Missouri

11. Toledo, Ohio

10. New York, New York

09. Lake County, Illinois

08. Stockton, California

07. Warren, Michigan

06. Vallejo, California

05. Modesto, California

04. Chicago, Illinois

03. Rockford, Illinois

02. Flint, Michigan

01. Detroit, Michigan

Totals:

Michigan 3

Illinois 3

California 3

Ohio 3

New York 2

New Jersey 2

Missouri 1

Wisconsin 1

Georgia 1

Indiana 1

They Don't Actually READ The Stories At Real Clear Politics

Two People In Washington DC Who Get Reelected For Doing Nothing

Gasoline In Grand Rapids Is Up 25% Since Christmas

Gasoline is up about 25% in Grand Rapids, Michigan, since Christmas to date, just two short months ago. We're actually a little off the highs today. Prices have been erratic at places like Sam's Club where lines are long for what is often the cheapest gasoline in the area (members only). I waited 20 minutes to fill the day after Valentine's, with a bitter cold wind blowing which was not deterring anyone from filling at $3.689/gallon. Today it's $3.769. The price of a fill for me is basically $12 higher today than it was at Christmas.

Molly Ball Doth Espy The Flaccid Organ Called The Senate

For The Atlantic, here:

"The last time a major new piece of policy legislation passed the U.S. Senate was July 15, 2010.

"That's when the Dodd-Frank financial-reform bill came through the Senate. And it was 951 days ago."

Just before the Republicans retook the House in 2010, over 400 bills passed by the then Democrat-controlled House under Speaker Pelosi languished unactioned in Sen. Harry Reid's Democrat-controlled Senate, on which, see here.

Obama Flashback 11/21/11: I Will Veto Any Effort To Stop Sequester

See him say it here, about 3 minutes 55 seconds into the statement made just four months after signing the sequester:

"I will veto any effort to get rid of those automatic spending cuts."

Now, of course, the sequester is no longer his idea and is going to be catastrophic:

Obama cautioned that if the $85 billion in immediate cuts - known as the sequester - occur, the full range of government would feel the effects. Among those he listed: furloughed FBI agents, reductions in spending for communities to pay police and fire personnel and teachers, and decreased ability to respond to threats around the world.

Just ask the Fed to monetize some debt and move on already, will ya buddy?

What You Get When Santa's Hearing Aid Batteries Die

You asked for a GPS unit . . .

. . . but you got a PMS unit instead.

Rush Limbaugh Nonplussed By Caller, Expunged From Record

Rush Limbaugh received a call today from an impertinent listener who suggested that the sequester hubbub about cutting spending by $85 billion a YEAR was completely meaningless since the Federal Reserve has been buying securities in similar amounts every MONTH in the various quantitative easing iterations. We could cut the spending, the caller suggested, and just turn around and recreate the money since the Fed is doing it all the time anyway and no one would ever be the wiser.

The caller was correct, but Rush was completely nonplussed and nervously dismissed the call and cut to commercial (which is why all calls are taken just before commercial breaks, in case they go Egypt). Since I can't find a record of it in the transcripts tonight, I'm guessing it really did disturb Rush enough to make sure the memory of it went straight into the circular file.

But think about it. The Democrats, especially Obama, are screaming the spending cuts are draconian and will hurt necessary jobs and the economy's growth. The Republicans are screaming that unless we cut spending, the world as we know it may come to an abrupt end because of the way a huge mountain of debt threatens to crush growth. Meanwhile the Federal Reserve has expanded its balance sheet from about $500 billion before the crisis to $3 trillion today by purchasing all manner of MBS and Treasury securities and what have you. Over four years that comes to a rate of about $52 billion a MONTH of funny money fed intravenously into the banking sector because it is still as good as dead in its bed.

That threatens everything Rush believes and says about the banks, how they were forced to take TARP, didn't really need it, paid it all back, are now healthy, blah blah blah. When the real story is that the losses they have taken on housing are gargantuan and have left huge holes in their balance sheets (you know, the off-balance-sheet-balance-sheets). The virtually free money from the Fed is designed to help them profit to get back on their feet. For public consumption the Fed says it is doing this to make mortgages cheaper so that housing revives, so that employment revives, neither of which is the real reason. The real reason is to throw banks a life line to allow their private trading desks to make money speculating in the stock markets et alia and restore their capital base.

It's government of the banks, by the banks and for the banks. The rest is just a sideshow.