The race to the bottom. But this time the supporters of the ideology that is leading the race to the bottom are not hiding behind slogans such as "small government", "government is the problem" or "trickle down economics". No, no, they are coming right out in the open. For example this New York Times article: here.
The authors of this article don't waste any time. Check out the first paragraph:
American workers are overpaid, relative to equally productive employees elsewhere doing the same work. If the global economy is to get into balance, that gap must close.
But it gets better:
The big trade deficit is another sign of excessive pay for Americans. One explanation for the attractive prices of imported goods is that American workers are paid too much relative to their foreign peers.
Here's the money quote from the SIGTARP report, right in the summary:
The original terms of federal assistance to AIG, including the high interest rate it adopted from the private bank’s initial term sheet, inadequately addressed AIG’s long term liquidity concerns, thus requiring further Government support.
Ben Bernanke has come out with a now, now, there, there on the falling dollar:
The Federal Reserve is monitoring currency markets “closely” and will conduct policy in a way that will “help ensure that the dollar is strong”, Ben Bernanke said on Monday in rare comments on the US currency.
The Fed chairman also indicated that the US central bank would not ignore the impact of rising commodity prices when evaluating the outlook for inflation. He said he would not rule out using interest rates to combat new asset price bubbles, even though he did not see obvious mispricing in the US at this stage.
Hmmmm, no obvious mispricing. Does that include the oil speculative bubble of 2008?
Meanwhile Gold is through the roof, in part due to the dollar decoupling.
The Italian Banking Association (ABI) on Wednesday decided to allow mortgage holders who are in serious economic difficulty to suspend payments for up to one year.
Local media said the measure will go into effect in January and will apply to three categories of mortgage holders who are now unemployed following the economic downturn.
To benefit from the payment deferment mortgage are holders who have simply lost their jobs, who are on temporary lay-off plans, who were self-employed but have fallen out of business and who have lost family members whose income supported the entire family.
So what it's true? A Chinese official trashed our currency, so the dollar is down and gold reaches another high.
"The continuous depreciation in the dollar, and the U.S. government's indication that, in order to resume growth and maintain public confidence, it basically won't raise interest rates for the coming 12 to 18 months, has led to massive dollar arbitrage speculation," Liu Mingkang, chairman of the China Banking Regulatory Commission, said Sunday in Beijing at the International Finance Forum, according to news reports.
This is a different type of gold rally, with support coming from both sides of the market -- investment [and] fundamental," said Darin Newsom, a senior analyst at Telvent DTN.
The New York Times has gotten hold of emails proving speeches are written by corporate lobbyists. Now if they would only expose how many bills are as well.
E-mail messages obtained by The New York Times show that the lobbyists drafted one statement for Democrats and another for Republicans.
The lobbyists, employed by Genentech and by two Washington law firms, were remarkably successful in getting the statements printed in the Congressional Record under the names of different members of Congress.
Personally I've know this for some time. The public relations techniques of lobbyists are notorious. There are so many lobbyist press kits and white papers, it must look like snow.
Based on my best judgment, it is most likely that the unemployment rate will peak close to 11% and will remain at a very high level for two years or more.
Some economists are predicting a unemployment rate peak of 13%.
Roubini is calling for bold action.
There's really just one hope for our leaders to turn things around: a bold prescription that increases the fiscal stimulus with another round of labor-intensive, shovel-ready infrastructure projects, helps fiscally strapped state and local governments and provides a temporary tax credit to the private sector to hire more workers.
This should be no surprise. TARP expires at the end of the year, so of course the Obama administration is considering extending it.
The Obama administration is leaning towards extending the troubled asset relief programme into next year, retaining part of the $700bn war chest in case of another financial emergency.
Although no final decision has been made, officials in the Treasury are wary of letting the fund expire as scheduled at the end of the year and are seeking to allay criticisms and fears about the future use of Tarp, which has been tapped to provide capital injections in a variety of companies from Citigroup to General Motors.
It wasn't enough to bailout the financial conglomerates with $12 trillion and then provide a first-time homebuyer tax credit that helps them and homebuilders. No, that wasn't enough. Homebuilders needed something more direct and definite. How about huge corporate tax refunds? That's the ticket.
That's right - huge tax refunds to another industry that benefited tremendously from the cheap money that was flowing like water. Now they are helped on the down side And what about us - fu*k the little guy - foreclosures and unemployment keep increasing.
ON Nov. 6, President Obama signed the Worker, Homeownership and Business Assistance Act of 2009 into law, extending unemployment benefits by 20 weeks and renewing the first-time homebuyer tax credit until next April.
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