This was written and posted by Mitchell Hirsch last week at Working America's 'Main Street' blog, where he is a featured guest blogger. Mitch was kind enough to email me his HTML text to cross post it here.
What if Wall Street's financial transactions could be taxed to help fund job creation and economic recovery on Main Street? Politically the idea is vastly appealing, especially in the wake of Wall Street's bailouts and the resurgence of its obscene bonus plans. But as it turns out a financial transactions tax also makes a lot of economic sense.
The basic idea is fairly simple. Impose a small percentage tax of anywhere from .02% to .5% on things like securities trades and derivatives transactions, thereby generating an estimated $150 billion annually.
The Producer Price Index, otherwise known as PPI, rose 1.8% on finished goods for November 2009. Graphs below in two different flavors, percent change for the year and aggregate:
Industrial Production has increased 0.8% from last month. Manufacturing increased 1.1% with gains in both durables and non-durable goods. This is good news. Mines (think about the price of commodities recently), increased 2.1% from last month. Utilities decreased -1.8%, blamed on mild temperatures.
Here is the graph of industrial production since the official start of this recession, the index is now at 2002 levels:
Most of us have been calling for a reinstatement of Glass-Steagall as part of financial reform for some time, supposedly the calls falling on deaf ears.
Glass-Steagall is the 1933 legislation which put a firewall between commercial and investment banking. It was repealed by the notorious Gramm-Leach-Bliley Act of 1999 and has been pinpointed as a major source of economic woe ever since including this recent financial crisis.
Please call your House Representatives and ask them to reinstate Glass-Steagall. To find your Representative, click here. Please call or fax them to demand Glass-Steagall be reinstated.
Figures from the Chicago Mercantile Exchange, often used as a proxy of hedge fund activity, showed investors cut their net short positions in the dollar from 172,367 contracts on December 1 to 107,284 contracts on December 8.
The fall in bets against the dollar, which had a notional value of $9.8bn, was by far the biggest weekly positioning shift of 2009, and the largest since July 2008.
This is partly betting the Fed will wind down loose monetary policy.
So what the hell is naked access? Naked Access allows traders to see what is happening on the exchanges themselves. This gives them a 30 millisecond window (yes trading is performed by sophisticated computer algorithms in the microseconds), to view trades before being executed. Thus, those with the technology, such as Goldman Sachs can execute high frequency and fast trades.....before the rest of investors see the various stock exchange orders.
Naked access gives trading firms, using brokers' licenses, unfetted access to stock markets. The firms, usually high-frequency traders, are then able to shave microseconds from the time it takes to trade.
AP has cranked the 3 year default rate on government student loans and discovered a 21.1% default on for profit schools vs. a whopping 12% 3 year default rate from government student loans overall.
According to this Wikipedia article, 9% of all college students attend for profit schools. There is also an issue of transferring credits to a non-profit educational system, although some for profits have been accredited. A list of for profit schools is here.
For many a post, I've said the U.S. government needs to get into the Venture Capital game, especially for key advanced sectors critical to the national interest. Well, read this Wall Street Journal piece to get a warm fuzzy that someone, somewhere, is doing something right.
The DOE hopes to lend or give out more than $40 billion to businesses working on "clean technology," everything from electric cars and novel batteries to wind turbines and solar panels. In the first nine months of 2009, the DOE doled out $13 billion in loans and grants to such firms. By contrast, venture-capital firms -- which have long been the chief funders of fledgling tech firms, taking equity stakes in the start-ups that will pay off if they go public -- poured just $2.68 billion into the sector in that time, according to data tracker Cleantech Group.
I don't care how Machiavellian you are as an investor, this story is not good and I sure hope all consider donating locally to food banks. While the world has over 1 billion people in hunger and the United States has surged past 35 million on food stamps with half of all children at some time being on them, we have these forecasts:
Rice may surge 63 percent to $1,038 a metric ton from $638 on Philippine imports and a shortage in India, a Bloomberg survey of importers, exporters and analysts showed. The U.S. government says nonfat dry milk may jump 39 percent next year, and JPMorgan Chase & Co. forecasts a 25 percent gain for sugar.
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