Welcome to the weekly roundup of great articles, facts and figures. These are the weekly finds that made our eyes pop.
Overnight Food Inflation in the United States
“On Feb. 8, the U.S. Department of Agriculture reported prices of $22.95-24.95 for two-layer cartons of 4x4, 5x5 and 5x6 vine-ripe field-grown tomatoes from Mexico, up from $6.95-9.95 the week before and $5.95-7.95 the year before.”
Amazing this story isn't front page news. From a local news station in Oregon:
Get ready to pay double or even triple the price for fresh produce in the coming weeks after the worst freeze in 60 years damaged and wiped out entire crops in northern Mexico and the southwestern U.S.
The problem started less than a week ago, when our nation was focusing on the Superbowl and sheets of ice falling from Texas Stadium.
Farmers throughout northern Mexico and the Southwest experienced unprecedented crop losses. Now devastation that seemed so far away, is hitting us in the pocketbooks.
"We've had to double and triple some prices and consumers come in and it's quite a shock to them," said Rusty Peake, GM of Food4Less in Southeast Portland.
"Increase, increase, increase," said produce manager Troy Winterhalter as he watched urgent messages coming across his laptop computer. "Peppers, zucchini, cucumbers, asparagus, the entire asparagus crop was wiped out," said Winterhalter.
Roma tomatoes have more than doubled in price since Thursday and very soon they may not be available at all.
About the only produce not impacted by the freeze in the coming weeks are things grown right here in the Northwest like potatoes, onions and apples.
The situation is so dire, some stores can't honor certain advertised prices, which were ordered in local newspapers long before the freeze.
Dismissing the Employment Crisis
It never ceases to amaze me how some so called economists attempt to dismiss away the jobs crisis. Krugman calls out the latest in structural impediment.
Even the usually deadly accurate and unbiased Calculated Risk is getting into the game, this time with the labor participation rate. While Calculated Risk's data is accurate, just because we have a decline pattern going on before the Great Recession does not mean those people do not need a job anymore. I hate to tell you, but illegal immigrants working in unskilled labor jobs has a strong correlation to the lower labor participation rates for those between 16-24. Also, the older crowd, there is no pension funded retirement for them to drop out of the labor force on. Lots of problems with these assumptions.
The End of Freddie Mac & Fannie Mae
Yesterday the Obama administration put out a report to end Freddie Mac & Fannie Mae:
The Obama administration plans to wind down bailed-out Fannie Mae and Freddie Mac over the next five to seven years, Treasury Secretary Timothy Geithner said Friday.
The taxpayer-owned mortgage giants, which were effectively nationalized in 2008, guarantee nine of every 10 new mortgages along with other government agencies. Delinquencies on home loans backed by the two companies have cost taxpayers more than $150 billion.
The troubled housing market, and the key role sour mortgages played in causing the financial crisis, has led to calls for the federal government to radically reform the way home mortgages are financed. The role of the government in funding those mortgages must also be altered, policy makers, bankers and investors say. Administration officials have vowed to reform the market. In a report delivered today to Congress, the administration outlined its goals for the future of housing finance, and three broad options for legislators to pursue.
Supposedly Economist Mark Zandi will release a report which states if mortgages are fully privatized it will result in a 10% drop in home prices and a 1% mortgage interest rate increase.
Sure 'nuf, the report came out and private loan insurers & servicers on mortgages stock jumped 13%. All hail the banks, bummer they have screwed so many customers, I'm not quite sure who is left to buy a home.
Labor as a Commodity
Naked Capitalism does a latest attitude call out in this piece ripping the New York Times. It's really true, U.S. businesses treat the American worker like disposable diapers and views people as something to trade, like bushels of corn or wheat.
Stop Breathing Damn It!
This one came via Naked Capitalism, it's a CO2 simulation, based on the birth/death rate. That's greenhouse gases, global warming. Yes Virginia, the planet has too many people, along with too many cows, pigs, goats and sheep for the people to eat. Bottom line, in spite of the political correctness muzzling agendas with various special interests goals behind them, to not talk about population and migration, population does affect all things, including labor markets and the environment.
Peterson Institute Debt Hysteria Call Out
James K. Galbraith has done a nice call out on the never ending debt and deficit spins to cover up alternative agendas.
The Fiscal Solutions Tour is the latest Peter G. Peterson Foundation effort to rouse the public against deficits and the national debt — and in particular (though they manage to avoid saying so) to win support for measures that would impose drastic cuts on Social Security and Medicare. It features Robert Bixby of the Concord Coalition, former Comptroller General David Walker and the veteran economist Alice Rivlin, whose recent distinctions include serving on the Bowles-Simpson commission. They came to Austin on February 9 and (partly because Rivlin is an old friend) I went.
Mr. Bixby began by describing the public debt as “the defining issue of our time.” It is, he said, a question of “how big a debt we can have and what can we afford?” He did not explain why this is so. He did not, for instance, attempt to compare the debt to the financial crisis, to joblessness or foreclosures, nor to energy or climate change. Oddly none of those issues were actually mentioned by anyone, all evening long.
The debt is real, the agenda to destroy whatever is left of American social safety nets due to some money and power grab is also real. This one is a must read, it's one thing to deal with deficits and it's an entire other agenda to destroy anything left for the U.S. middle class and citizens of this nation.