The Founders Didn't Believe In American Exceptionalism: They Sought To Be Equals In The World

"When in the Course of human events, it becomes necessary for one people to dissolve the political bands which have connected them with another, and to assume among the powers of the earth, the separate and equal station to which the Laws of Nature and of Nature's God entitle them, a decent respect to the opinions of mankind requires that they should declare the causes which impel them to the separation."

Rush Limbaugh: The Big Boob On The Right

It's Monday and you know what that means. If Rush Limbaugh is talking about numbers on a Monday he's going to slaughter them.

I counted two major instances today of getting it totally backwards.

The first, on Janet Yellen, is totally missing from the transcripts. He had said she will completely reverse the Bernanke policy and tighten when everyone knows she'll do no such thing. Someone must have called him to correct him, and then he reversed what he had said previously, and corrected it (here) to avoid looking like the total boob that he is:

I was misinformed by a self-professed market expert.  Anyway, my bad.  I got 'em reversed.  That's why the market's doing well today. It is because the priming of the stock market pump is scheduled to continue unabated if this Yellen woman ends up being the chairman of the Fed.  Now, I'll give you the stats on all this quantitative easing. It's basically $85 billion a month.  What it is, is they're not really printing the money.

In other words, the man with the golden EIB microphone doesn't have the brains to discern the one position from the other, nor is any real knowledge about the subject he may possess anything but completely derivative. He relies on what other people whom he trusts tell him, and can't reason it out for himself, not even by checking the stock market before he goes on the air. And for that reason what he says is no good to his audience. He's just quoting an authority figure. But what is really shameful is that he simply blamed his error on someone else when the privilege of holding a microphone going straight into the ears of millions should be viewed by him as a great responsibility which rests on him, not on his sources. Instead he treats his public position, and his hearers, with contempt by blaming someone else.

The second major blunder was that Rush stated that the US created $18 trillion out of thin air during the financial crisis, when that figure is the estimate for global borrowing, and certainly is not money printing:

The overall amount of priming that the federal government and the Federal Reserve along with several other central banks all over the world have done, the amount of money that they put in to the global economy... What was it I heard? It's $18 trillion, and that's just the US number. That's what it is. It's $18 trillion all told for $1 trillion worth of growth.  So in order to get $1 trillion of economic expansion in the past five years, the Fed has spent $18 trillion.  It's been classic Keynesian economics. ...

The bottom line was, folks, that $18 trillion was created out of thin air -- $18 trillion.  I mean, this doesn't even get lopped on to the national debt because this is not money authorized by the federal budget by US Congress.  This is just the Federal Reserve just decided to print money wherever they wanted and send it wherever they wanted, all ostensibly to save the world economy.  All it did was bail out the best and the brightest from the mistakes that they had made. 

Then during a break another panicked phone call comes in from the trusted source and Rush again quickly corrects himself, putting the $18 trillion figure on the global effort, not on the US alone, and designating it as "borrowed" not "printed":

It's $18 trillion. The G7 nations borrowed $18 trillion since the financial crisis and have only $1 trillion in economic growth to show for it.  That's it.  That's what it's bought us. There was $18 trillion borrowed, and a lot of it's gonna be forgiven and not have to be paid back.  By the way, if you want to know what happens to that money, say hello to tax increases down the line.

I'm sure by this time the rubes are completely confused by their hero. There's no point in explaining any of this to Rush because he gets this stuff wrong no matter how many times it is explained to him, which just shows he has no desire to learn it or simply lacks the mental equipment.

In which case he ought to just shut up about it. Spreading falsehoods is bad for the country and bad for the cause. 

Debt To The Penny Has Been $16.738 Trillion For 74 Days Straight

View Debt to the Penny for yourself here, and count the days.

It's really remarkable, because the debt was in the $16.8 trillion range for many days in April, and backed down from there and stayed at the current level, a few hundred million dollars here and there notwithstanding.

Under Obama Identifying As "Lower Class" Reaches Highest Level Ever: 26 Million

400 homeless encampments in Marin County in 3 years

As reported here:

Roquemore is among the small but surging share of Americans who identify themselves as "lower class." Last year, a record 8.4% of Americans put themselves in that category — more than at any other time in the four decades that the question has been asked on the General Social Survey, a project of the independent research organization Norc at the University of Chicago.

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The September 11th story excerpted at left details the ongoing problems of homelessness and poverty in Marin County, California, during the last three years and concludes that there are about 630,000 Americans living like this throughout the country as we speak.

Read it, here.

The Crony Capitalist Banks: The Biggest Winners Since The Crash

And we, of course, are the biggest losers.

Tom Petruno for The LA Times:

In the second quarter of this year U.S. banks earned a total of $42.2 billion — the biggest industry profit in history, and double the earnings of the same period in 2010. It's no accident that the banks have prospered mightily since the crash, said Neil Barofsky, who was the watchdog over the U.S. bank bailout program launched in September 2008. "We turned the entire resources of the nation toward one goal: setting up a situation where the banks could earn their way out of this," said Barofsky, now an attorney at Jenner & Block in New York. The plan was not, he lamented, "about holding institutions accountable" for the debacle. ...

[I]n the longer run, TARP was less significant for many banks than the aid of the Federal Reserve under Chairman Ben S. Bernanke. By hacking short-term interest rates to near zero and holding them there since the end of 2008, the Fed has slashed bankers' cost of money — particularly deposits — to well below what they earn on loans and investments. Hence, record profits. ...

The Fed's decision to keep short-term interest rates near rock bottom for nearly five years has devastated the income of tens of millions of Americans. In the mid-2000s, savers in banks were routinely earning 4% or more on one-year bank certificates of deposit, or $2,000 in annual interest on a $50,000 nest egg. The average rate now: 0.23%, according to Bankrate.com. The same $50,000 nest egg earns just $115 a year in interest at that rate. "And after inflation they're actually losing ground," said Andrew Lo, a finance professor at MIT in Cambridge, Mass.

Read the rest from Tom Petruno, here.

Larry Summers Officially Not A Candidate For Fed Chair, S&P500 Futures Soar 20

The Bernank will be replaced by a clone, according to the market players.

Another dark day for the free market, an ecstatic one for those first in line for money.

Food Stamp Recipients In June Edged Up Again To Near Record Level

The number of people receiving food assistance edged up again in June to 47,760,285, just shy of the record in December 2012 which was 47,792,056.

The reports may be viewed here.

Data is through September 6th.

15.18% of America's population of 314.69 million receives government food assistance, or 1 in 6.6 individuals, each receiving less than $133 per month or $1.47 per meal.

To Us Obama's A Dictator, To Liberals An "Executive-Power Extremist"

You won't find the traditional words "king", "tyrant", "usurper" or "dictator" in Conor Friedersdorf's Atlantic column, "Obama Acts Like He Doesn't Know He's An Executive-Power Extremist", here, because, before dictatorship disarms the population, it has to disarm the language first.

And it has:

The grammer is priceless. Who "put more and more war-making power in the hands of the president"? In Obama's telling, "a decade" put the executive power there. ... We know that Obama is an executive-power extremist in his actions. ...  [I]s he fooling himself, because he likes to think of himself as [a] more prudent and moderate man than he is? Can he not bear the truth that he's a Cheneyite extremist?

There it lies, limp as a dick. 

NSA Poses As Google To Spy

G.NSA.NSA.G.L.E.

'Brazilian site Fantastico obtained and published a document leaked by Edward Snowden, which diagrams how a "man in the middle attack" involving Google was apparently carried out.'

Story here.

Completed Foreclosures In July Still 133% Of Pre-2006 Averages, Starts Down To 7.25% Above Normal

Corelogic reports here at the end of August that completed foreclosures in July 2013 ran at a level of 49,000. The pre-2006 average level was 21,000. Though still highly elevated, July 2013 is a big improvement over July 2012 when completed foreclosures were at 65,000. That means conditions have improved by almost 25% in the last year.

Corelogic puts completed foreclosures since September 2008 at 4.5 million, with 949,000 homes presently in some state of foreclosure.

Separately CNBC and AP Obama here are happy to report that foreclosure starts are almost back to 2005 levels and are within 7.25% of normal at 55,775 in August:

Lenders initiated foreclosure action in August against the fewest U.S. homes for any month in nearly eight years, a trend that should help reduce the number of homes lost to foreclosure in the months ahead. Some 55,775 homes entered the foreclosure process last month, a decline of 8 percent from July and down 44 percent from August last year, foreclosure listing firm RealtyTrac Inc. said Thursday.

Muslims Submit 5 Times A Day, Americans Not Even Once

"Stand up to Islam".

Australian Conservative Victory Was Backlash Against Carbon Tax

WUWT, here:

"Many Australians are celebrating the win of Tony Abbott and his coalition government as a vote by the populace against the much hated Carbon Tax ramrodded by former prime minister Julia Gillard."

Low Jobless Claims "Not At All Inconsistent With ... Maximum Market Risk"

So says John Hussman, here:

"[W]hile the low level of initial claims for unemployment has been a bright spot, the simple fact is that initial claims are almost always depressed at major market peaks, which contributes to the optimism and euphoria at those highs. ... the recent pattern of new claims for unemployment ... is not at all inconsistent with previous instances of maximum market risk."

Absolute Strategy Research Survey Finds 11% Think This Is Still A Depression, 25% A Recession

The survey may be viewed here.

Look on the bright side: Since February almost 20% fewer think the economy is still in recession, and over 30% fewer think the economy is in a depression.

I guess we'll have to try harder.

Average Weekly Hours Haven't Been "Full-Time" For 12 Back-To-Back Months Since 4/'80

The last time average weekly hours averaged full-time, that is, 35 hours or above, for 12 consecutive months or more was in April 1980.

ObamaCare's 30-Hour Full-Time Rule, A Depression Era Idea Going Back To 1937 And Hugo Black

In 1935, Black became chairman of the Senate Committee on Education and Labor, a position he would hold for the remainder of his Senate career. In 1937 he sponsored the Black-Connery Bill, which sought to establish a national minimum wage and a maximum workweek of thirty hours. Although the bill was initially rejected in the House of Representatives, an amended version of it, which extended Black's original maximum workweek proposal to forty-four hours, was passed in 1938 (after Black left the Senate), becoming the Fair Labor Standards Act.

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Even before Roosevelt was inaugurated, Black introduced legislation to establish a minimum wage and to limit work in most large industries to 30 hours a week in order to spread available jobs to millions of workers who lost their jobs in the Great Depression. Six years later, Black's substantially revised legislation became the Fair Labor Standards Act, America's first minimum-wage law. Black's Senate committee investigations prompted the reorganization of the nation's airline and utility industries. While most Southern members of Congress selectively supported New Deal proposals, Black usually voted for Roosevelt's policies and often complained that the administration did not go far enough to help the lower classes.

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Senator Hugo Black of Alabama, a champion of a 30-hour workweek, agreed to sponsor the Administration bill on this subject in the Senate, while Representative William P. Connery of Massachusetts introduced corresponding legislation in the House. The Black-Connery bill had wide Public support, and its path seemed smoothed by arrangements for a joint hearing by the labor committees of both Houses.

Generally, the bill provided for a 40-cent-an-hour minimum wage, a 40-hour maximum workweek, and a minimum working age of 16 except in certain industries outside of mining and manufacturing. The bill also proposed a five-member labor standards board which could authorize still higher wages and shorter hours after review of certain cases.

Proponents of the bill stressed the need to fulfill the President's promise to correct conditions under which "one-third of the population" were "ill-nourished, ill-clad, and ill- housed." They pointed out that, in industries which produced products for interstate commerce, the bill would end oppressive child labor and "unnecessarily long hours which wear out part of the working population while they keep the rest from having work to do." Shortening hours, they argued, would "create new jobs...for millions of our unskilled unemployed," and minimum wages would "underpin the whole wage structure...at a point from which collective bargaining could take over."

Government Statistics Will NEVER Capture The ObamaCare "Part-Timing" Trend

The long term trend in average weekly hours is down, down, down.

And the reason is simple and devious by design, in order to escape detection: Anyone working less than 35 hours is already part-time as far as the government statistical agency, the Bureau of Labor Statistics, is concerned, so if hours are reduced from say 34 to 29 to comply with ObamaCare's new definition of part-time, that will never show up in the part-time numbers because that will not make the slightest bit of difference. People working 34 hours were already part-time as far as the BLS is concerned, so if they are cut back to 29 they will still be so. 

The BLS here defines full-time as 35 hours or more per week, and part-time as anything less than 35:

"[Part-time] Refers to those who worked 1 to 34 hours during the survey reference week and excludes employed persons who were absent from their jobs for the entire week."

This is a well known fact. But it is little appreciated that as ObamaCare deviously defines full-time as 30 hours or more, that will by definition not make a difference to the BLS' statistical presentation, which doesn't begin counting full-time until hours are 35 or more.

It's as if the 30 hour rule were designed to exploit the bureaucratic inertia behind the different definition and fly under its radar.

The only way we'll be able to observe the perverse scaling back of employee hours is in the hours statistics. Unfortunately, the long-term trend in hours is down, down, and down, and it will be difficult to detect the new downward trend within the old downward trend. Besides, average weekly hours are up since ObamaCare passed, obviously because the economy is slowly improving from a great deficit, ObamaCare notwithstanding. Average weekly hours are actually up 2% since ObamaCare passed.

The Senate healthcare bill, like the Senate itself since the passage of the 17th Amendment, is a Trojan Horse meant to destroy the country as we once knew it. It were almost better if the Senate no longer existed, and the House expanded to the proportions it had formerly before the Reapportionment Act of 1929, itself a grievous offense against the liberties of the people.

Average weekly hours are up 2% since ObamaCare passed.

The Workforce Depression Of 2007 Remains 4.19 Million In The Hole According To Social Security

The size of the workforce earning wages for Social Security purposes went into multi-year depressions since 1990 three times: 1990, 2001 and 2007.

The 1990 depression saw the workforce shrink by 1% and not recover in size until the third following year.

The 2001 depression saw the workforce shrink by 0.4% and not recover in size until the third following year.

The 2007 depression saw the workforce shrink by 3.3% and as of 2011 still has not recovered, four years later. The depression in workers through 2011 is 4.19 million, and since the bottom in 2010 982,000 workers have been added through 2011. 2012 figures will be available in mid-October 2013.

The depression in jobs designated "usually full-time" is 5.35 million, 4.3% below its 2007 peak. 

Sorry, But We Aren't Talking About A Lot Of People Not Counted In The Unemployment Numbers

I'd estimate the number not counted in the unemployment numbers to be between 1.5 million and 3.2 million, max.

9.784 million have left the labor force under Obama and are not counted as unemployed since he was elected 4.75 years ago. That's a lot of people, 75% more than left the labor force under George Bush. Not quite 9.5 million left under Bush, but that was over 8 full years.

Who are they who have left the labor force? And should any of them be counted as unemployed as many critics keep maintaining?

The people who should not be counted as unemployed from that total include the 1.1 million who retire every year, so subtract 5.2 million over the period, leaving 4.584 million. Those not in the labor force with a disability are up 1.4 million since 2008. Subtract them and that leaves 3.184 million.

As for the people who should be included in the unemployment number but aren't, they include the number leaving the labor force who wanted to work and searched for a job but were not counted as unemployed. But they were counted by the government. That number has increased by about 1 million since the beginning of the 2007 recession, as shown in the graph (h/t Mish). Then add in those not in the labor force who weren't discouraged workers but looked for work for other reasons and you add another 475,000. They weren't counted in the unemployment numbers either, but they were counted by the government.

So subtracting those 1.475 million from 3.184 million, you get 1.7 million unaccounted for who might or might not need to be included with those 1.475 million who perhaps should be. Many of those 1.7 million are probably like a lot of Americans who became sole proprietors in the aftermath of losing their regular jobs and involuntarily went into business for themselves, making lots less money than before in many instances, typically as contract employees and freelancers, supplementing their incomes from their savings and practicing frugality. The US Census Bureau might agree, having just reported here in May that between 2008 and 2011 alone the number of such "businesses" is up 1.2 million in the aggregate. That leaves you with a minimum expansion of the unemployed to 12.8 million from the current 11.3 million, and a maximum expansion to 14.5 million, but based on the Census data on sole proprietorships, I'll lean to the under.

The real unemployment rate would therefore be something a little higher than the current 7.3%,  between 8.3% and 9.4%, but probably closer to 8.3%. I'll go with 8.6% unemployment based on an additional 1.975 million not in the labor force who could very well be in it.

That's almost 18% worse than the government says unemployment is right now, but based on what I see regularly from government estimates of things, that's routinely good enough for them.

After all, hasn't it been called "good enough for government work" for decades for a reason?

Usually Full-Time Under Obama Has Nearly Recovered, Just 564,000 Jobs Short Of The 11/08 Level

The graph shows usually full-time from November 2008 to present. Full-time jobs, contrary to what you may have heard, have nearly recovered to the level they were at when Obama was first elected.

Full-time is cyclically higher in summers, so expect a decline in this metric by Christmas. If the pattern of shallower cyclical lows persists, expect a dip to 116 million.

The country is still a long way from a full full-time jobs recovery, however. Peak full-time in 2007 had been in excess of 123 million jobs.