October 2011

Americans Are Awash In Spin

orwellian
I have come to the conclusion that Big Brother's subjects in George Orwell's 1984 are better informed than Americans.
 
Americans have no idea why they have been at war in the Middle East, Asia and Africa for a decade. They don't realize that their liberties have been supplanted by a Gestapo Police State. Few understand that hard economic times are here to stay.
 
On October 27, 2011, the US government announced some routine economic statistics, and the president of the European Council announced a new approach to the Greek sovereign debt crisis. The result of these funny numbers and mere words sent the Standard & Poor's 500 Index to its largest monthly rally since 1974, erasing its 2011 yearly loss. The euro rose, putting the European currency again 40% above its initial parity with the US dollar when the euro was introduced.
 
On National Public Radio a half-wit analyst declared, emphatically, that the latest US government statistics proved that the recovery was in place and that there was no danger whatsoever of a double-dip recession. And half-brain economists predicted a better tomorrow.
 

Japanese Stop Currency Speculation, Not Really

Japan intervened in their foreign exchange rates after the yen hit a post WWII high against the dollar.

The dollar spiked after the intervention as much as 4 percent past 79 yen from around 75.65 yen. The dollar touched a record low of 75.31 yen earlier on Monday.

Finance Minister Jun Azumi said Tokyo stepped into the market for the second time in less than three months on its own at 10:25 a.m. local time (0125 GMT) and would continue to intervene until it was satisfied with the results.

The Yen is considered safe haven and there have been other recent interventions:

Monday’s maneuver was the fourth time in just over a year that Japan has intervened to stem the yen’s rise.

The BBC reports the Yen dropped 5% to the dollar after the move. One must wonder why is such speculation going on with the Yen, which is considered save haven. It seems in spite of the big Greek debt haircut and U.S. Q3 GDP of 2.5%., markets are leery and believe little has be resolved.

It seems speculators are ganging up on the yen in spite of Japan's quantitative easing:

Personal Income Up 0.1%, Consumer Spending Jumps 0.6% for September 2011

The Personal Income and Outlays report for September covers individual income, consumption and savings. Overall the report shows bad news as once again, America's income is rising less than spending. Spending is up 2.2% while disposable income has only increased 0.2% from this time last year.

New European Bail Out Announced - Greek Debt Gets a HairCut

We have another Eurozone bail out. The Euro Summit has released a 15 page statement (pdf) overviewing the agreement. The plan was ratified by all 17 Member States of the euro area.

First, there is a haircut on Greek debt, which while pretending to be voluntary, the volunteer or else threat behind it would allow a complete Greek default, where bond holders would get nothing and banks would probably be ruined.

We invite Greece, private investors and all parties concerned to develop a voluntary bond exchange with a nominal discount of 50% on notional Greek debt held by private investors. The Euro zone Member States would contribute to the PSI package up to 30 bn euro.

The plan is to reduce Greek debt to 120% of GDP by 2020 and is about €100 billion reduction with yet another €100 billion in additional aid.

The CBO Confirms The Rich Get Richer and the Rest of Us Get the Economic Shaft

The CBO has quantified what most of America already knows, the richer got richer while the rest of us are squeezing blood from a financial stone. In a new report, the Congressional Budget Office analyzed after tax household income growth by percentiles for 1995-2007. Guess what they found? The Rich increased their wealth out of the stratosphere in comparison to the rest of us.

Corporations Want Instant Ready Disposable Workers, Not Employees

The Wall Street Journal finally said what most working people know, there is no worker, or skills or talent shortage in America. The real problem is employers, their arcane human resources policies, and the demand for instant ready workers like some sort of ready to eat microwave meal.

disposableworkers, cartoonist unknown

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