Hhhhmmmm, wonder whats going on here?
From the BBC: What do you get when you mix two Japanese nationals with some fake US government bonds, a slow train to Switzerland and members of the Italian financial guard?
The answer is a $134bn (£82bn; 97bn euros) conspiracy theory which has fired up a whole realm of financial bloggers on the internet. See story HERE
From The Guardian UK: It was fortunate that Andrew MacKay did not encounter one of his elderly constituents when the Conservative MP defied growing public fury to show his face in Bracknell town centre yesterday.
“I can see ordinary people going round with shotguns and shooting them all,” said a pensioner in this industrious Berkshire town. She was so enraged by MPs’ expenses, she said, that she was tempted to shoot the Speaker herself.
The days when Dick Turpin reputedly rested up in a pub where this new town now sprawls have long gone. But voters outside Westminster are increasingly convinced that their representatives have got away with daylight robbery. See full story HERE
From The Telegraph UK: The dollar plunged instantly against the euro, yen, and sterling as the comments flashed across trading screens. David Bloom, currency chief at HSBC, said the apparent policy shift amounts to an earthquake in geo-finance.
“The mere fact that the US Treasury Secretary is even entertaining thoughts that the dollar may cease being the anchor of the global monetary system has caused consternation,” he said. See story HERE
It seems that countries that pay the most in taxes are also the most happy: The Organization for Economic Cooperation and Development says people in Denmark, Finland and the Netherlands are the most content with their lives. The three ranked first, second and third, respectively, in the OECD’s rankings of “life satisfaction,” or happiness.
There are myriad reasons, of course, for happiness: health, welfare, prosperity, leisure time, strong family, social connections and so on. But there is another common denominator among this group of happy people: taxes.
Northern Europeans pay some of the highest taxes in the world. Danes pay about two-thirds of their income in taxes. Why be so happy about that? It all comes down to what you get in return. The Encyclopedia of the Nations notes that Denmark was one of the first countries in the world to establish efficient social services with the introduction of relief for the sick, unemployed and aged. … Simply, you pay for what you get.
Taxes in the U.S. have taken on a pejorative association because, well, we are never really quite sure of what we get in return for paying them, other than the world’s biggest military. Healthcare and other such social services aren’t built into our system. That means we have to worry more about paying for things ourselves. Worrying doesn’t equate to happiness.
The U.S. ranked 11th on the OECD list. In addition to the top three, we were beat out by Sweden, Belgium, Canada, Australia, New Zealand, Switzerland and Norway. See full story HERE from TaxProf Blog.
Hundreds of people across the country stand to lose millions of dollars in what investigators describe as a Ponzi scheme based out of a Fresno equipment-leasing company.
And the man FBI agents believe masterminded it all — John W. Otto, a pioneer in the equipment-leasing industry — committed suicide this week in Palm Desert.
His death complicates what investigators say will be an enormous task: tracking down where all the money went, and whether others in Otto’s firm — HL Leasing — were involved.
FBI agents began looking into Otto and HL Leasing after investors complained that they had not received April interest payments on their investments with the firm. As many as 1,200 victims nationwide could lose the money they entrusted to Otto, investigators say.
“At this point, it does appear to be a Ponzi scheme,” said Steve Dupre, an FBI spokesman in Sacramento. “Right now, from our preliminary review, it appears that $138 million is the potential loss in this case.” See full story HERE
Spain is forecast to be the hardest hit by the “crisis”. The economy has suffered its largest contraction in 50 years SEE HERE and the Spanish have been taking to the streets on a regular bases regarding protection of the jobless SEE HERE . And to top it all off they have found Cocaine in the air SEE HERE . Go figure,
From The Guardian UK: Angry steel workers attacked the Luxembourg headquarters of ArcelorMittal, the world’s biggest steelmaker, during the company’s annual shareholders’ meeting yesterday, setting off smoke bombs and breaking through the front door in protest at temporary layoffs. See fulls story HERE
From The TimesOnline: THE head of Britain’s race relations watchdog says lack of control over immigration has led to a racial “cold war” among rival ethnic communities.
Trevor Phillips, chairman of the Equality and Human Rights Commission (EHRC), believes that the failed policy risks inflaming racism among millions of young mothers and working professionals.
In an address to mark the 40th anniversary of Enoch Powell’s infamous “rivers of blood” speech in which Powell warned of apocalyptic social consequences if the rising tide of immigration were not halted, Phillips will say that the predictions have not come true. But he will warn that mass immigration has caused a different form of “war” that is just as worrying.
“Powell predicted ‘hot’ conflict and violence. However, we have seen the emergence of a kind of cold war in some parts of the country, where very separate communities exist side by side . . . with poor communication across racial or religious lines,” Phillips will say. See full story HERE
From CNN.COM: Some employers treat their help as “not a person but a machine (that) starts in the morning: Put on a switch (and) work consistently right through the day. Take care of the children, washing, cleaning, cooking, right down to cleaning (the) car.”
The exploitation of workers is a huge business worldwide.
Don’t Miss
* ILO: ‘The cost of coercion’
People forced to work without pay collectively lose more than $20 billion a year in earnings, according to a report from the United Nations International Labour Organization released Tuesday.
Global profits from human trafficking and forced labor have reached $36 billion, according to the United Nations, and that sum is climbing.
“Forced labor is the antithesis of decent work,” ILO Director-General Juan Somavia said in a statement as the report became public. “It causes untold human suffering and steals from its victims.”
“It is the vulnerable who suffer the most” in times of economic crisis like the present, the report says.
It took years for governments to acknowledge the problem. Now the biggest challenges, officials say, are the implementation and enforcement of laws.
“Eighty percent of forced labor is in the private economy, but this is very, very rarely been prosecuted, if at all in most countries,” said Roger Plant, one of the authors of the ILO report. See full story HERE
From The BBC: Experts in Islamic finance believe their way of doing business has shielded them from the global credit crisis.
But how does it differ from conventional Western finance?
A former executive director of the International Monetary Fund, Dr Abbas Mirakhor, says wider Islamic economics relies on God’s guidance, handed down almost 1,400 years ago.
There is a “consciousness of a supreme creator and a system that he has provided”, he says.
What we know as the conventional Western way does not have that, which is “really the major difference between the two”, he adds.
In practical terms, the most significant difference is that charging interest is not allowed in Islamic finance.
FEATURES OF ISLAMIC ECONOMY
Dealing in interest, liquor, pork, gambling or pornography are prohibited under Sharia law
Islam forbids all forms of economic activity which it deems morally or socially harmful
Individuals must spend their wealth judiciously and not hoard it, keep it idle or squander it
Muslims have a duty to contribute a percentage of their wealth to deprived and poor sections of Muslim society
Neither are most forms of speculative investment permitted, such as hedging or derivatives trading. See full story HERE
For a decade now, consumers have become accustomed to free access to music, films and information, via the internet. But with many of the media’s big players – including Rupert Murdoch – thinking of charging for content, is the tide about to turn? See story from The Guardian HERE
Faced with losing his home if he cannot find €6,000 (£5,350) by the end of this week, Javier Martínez has resorted to desperate measures: the unemployed father-of-four is selling his own flat and throwing in another, free.
The three-bedroom apartment in Tarazona, near Zaragoza in eastern Spain, is on the market for only €57,000. The former construction project manager is including a one-bedroom flat that he had been letting in an attempt to entice a buyer.
“I need to find the cash by May 15 or I may be declared bankrupt. I must provide for my children,” Mr Martínez said. He is one of hundreds of thousands of Spaniards facing ruin as Spain’s economy heads for meltdown.
The number of Spaniards unable to pay their debts has risen by 26 per cent to 2.7million in 2009, compared with the first four months of last year. During the same period 232,000 companies joined the list of bad debtors, a 67 per cent rise, according to AsNef-Equifax, a Spanish credit agency. See the rest of the story from The Times OnLine HERE
San Francisco police Tuesday asked for the public’s help in finding a bank robbery suspect who reportedly told a bank manager he was angry about corporate bailouts.
The robbery took place at about 12:50 p.m. on April 15, at a Bank of America branch at 50 California St., according to police.
Police said the man initially asked to speak with a manager because he wanted to make “a large withdrawal.”
When he met with the manager, the suspect, who was carrying a black laptop case, explained he worked for an organization concerned about government bailouts of corporations, according to police.
The man then allegedly threatened to detonate a bomb he was carrying with him if the manager didn’t hand over cash.
The suspect smiled throughout the encounter, and told the manager the money “would go to people who deserve it,” police said. See full story HERE
A MACABRE traffic associated with poor countries in Asia and Latin America has sprung up for the first time in western Europe as the credit crunch reduces Spaniards to selling organs to “transplant tourists”.
Spanish “kidney for sale” advertisements have proliferated recently on the internet as people struggle to make ends meet in a country whose 17% unemployment rate is the highest in Europe.
Sergio, a 42-year-old welder and father of four, said he had received an offer of £20,000 from a German couple who needed his kidney for their five-year-old son. If tests showed them to be compatible, an operation would be performed in a “third country” since such transactions are illegal in Europe.
“Apparently, there’s a waiting list of at least five years for a kidney in Germany,” he told a television programme, “but in five years the kid will be dead.” Read full story from The Times Online HERE
The current global crisis is “vastly worse” than the 1930s because financial systems and economies worldwide have become more interdependent, “Black Swan” author Nassim Nicholas Taleb said.
“This is the most difficult period of humanity that we’re going through today because governments have no control,” Taleb, 49, told a conference in Singapore today. “Navigating the world is much harder than in the 1930s.”
The International Monetary Fund last month slashed its world economic growth forecasts and said the global recession will be deeper than previously predicted as financial markets take longer to stabilize. Nouriel Roubini, 51, the New York University professor who predicted the crisis, told Bloomberg News yesterday that analysts expecting the U.S. economy to rebound in the third and fourth quarter were “too optimistic.” See full story from Bloomberg HERE
The European Commission has revised economic forecasts sharply downwards and pushed recovery predictions out to the second half of 2010 in the face of the “deepest and most widespread recession in the post-war era”.
Brussels is now expecting Europe’s GDP to contract by 4 per cent this year, twice the 1.8 per cent predicted just three months ago. The slump will also last longer, with a further decline of 0.1 per cent in 2010, compared with earlier forecasts of 0.5 per cent growth.
Of the major EU countries, Germany will fare the worst, with a 5.5 per cent decline in 2009. But the Commission’s assessment will also make grim reading for the Chancellor of the Exchequer. The UK economy is expected to lose between 4 and 4.5 per cent in 2009, a far bleaker prediction than the 3.5 per cent forecast in Mr Darling’s Budget. Italy is also expected to contract by up to 4.5 per cent, France and Spain by 3 per cent. See more of the story from The Independent HERE
No this story is not from The Onion but is from The Telegraph:Local government officials in China have been ordered to smoke nearly a quarter of a million packs of cigarettes in a move to boost the local economy during the global financial crisis. See full article HERE
An addition to both gun and ammunition sales on the increase in the USA, classes teaching you “survival skills” are also doing good business:
“In today’s tough economic times, when people are contemplating living with less, survival classes are attracting plenty of students who believe the primitive world offers an embarrassment of natural riches that not only can make the difference between life and death but also can expand personal growth.
“Five years ago, I founded Adventure Out. It was just me with a few friends helping to give surf lessons and survival workshops,” says Cliff Hodges of Santa Cruz. “The company grew to 20 employees, and now we run programs all over the state. Now every class fills up with a pretty long waiting list.”
Wilderness survival schools have been around since the 1960s, but interest began swelling during the Y2K scare. These days, people have access to plenty of survival material. They’re watching survival television shows. They’re reading survival books, such as “Survive! Essential Skills and Tactics to Get You Out of Anywhere – Alive” by Les Stroud, host of the Discovery Channel show “Survivorman.” They’re checking out survival schools online and through word of mouth.” See full story from SF GATE HERE
From NPR: Piracy off the coast of Somalia has become an international problem — and an international business. Navy SEALS rescued an American merchant captain earlier this month after Somali pirates raided the Maersk Alabama as it was making its way around the Horn of Africa to deliver aid.
But the issues of criminality and the potential for violence aside, a closer look at the “business model” of piracy reveals that the plan makes economic sense.
A piracy operation begins, as with any other start-up business, with venture capital.
J. Peter Pham at James Madison University says piracy financiers are usually ethnic Somali businessmen who live outside the country and who typically call a relative in Somalia and suggest they launch a piracy business. The investor will offer $250,000 or more in seed money, while the relative goes shopping.
“You’ll need some speedboats; you’ll need some weapons; you also need some intelligence because you can’t troll the Indian Ocean, a million square miles, looking for merchant vessels,” says Pham, adding that the pirates also need food for the voyage — “a caterer.” See full story HERE
From CNN: Gun shops across the country are reporting a run on ammunition, a phenomenon apparently driven by fear that the Obama administration will increase taxes on bullets or enact new gun-control measures.
“In the last two months it’s gotten very, very difficult to find ammunition,” says Richard Taylor, manager of The Firing Line, a gun shop and shooting range in the Denver, Colorado, suburbs.
“There are a lot of rumors floating around that the present government would like to increase taxes on ammunition. I think [there is] just a lot of panicked buying going on.” See full story HERE
WHEN British consumers are compelled to buy energy-efficient lightbulbs from 2012, they will save up to 5m tons of carbon dioxide a year from being pumped into the atmosphere. In China, however, a heavy environmental price is being paid for the production of “green” lightbulbs in cost-cutting factories.
Large numbers of Chinese workers have been poisoned by mercury, which forms part of the compact fluorescent lightbulbs. A surge in foreign demand, set off by a European Union directive making these bulbs compulsory within three years, has also led to the reopening of mercury mines that have ruined the environment.
Doctors, regulators, lawyers and courts in China – which supplies two thirds of the compact fluorescent bulbs sold in Britain – are increasingly alert to the potential impacts on public health of an industry that promotes itself as a friend of the earth but depends on highly toxic mercury.
Making the bulbs requires workers to handle mercury in either solid or liquid form because a small amount of the metal is put into each bulb to start the chemical reaction that creates light. See full story from The Mailonline HERE
Tension over the global economic slump have fuelled May Day protests and riots across Europe with trouble breaking out in Germany, Greece, Austria, Turkey and France. Police in Berlin arrested 57 people while around 50 officers were hurt as young demonstrators threw bottles and rocks and set fire to cars and rubbish bins. There were also clashes in Hamburg, where anti-capitalist protesters attacked a bank.
In Turkey, masked protesters threw stones and petrol bombs at police, smashing banks and supermarket windows in its biggest city, Istanbul. Security forces fired tear gas and water cannon at hundreds of rioters and more than a hundred were arrested with dozens more hurt. There were also scattered skirmishes with police in the capital, Ankara, where 150,000 people marched. See full story from TheTelegraph HERE
More “Crisis” bloodshed? Reminds of the old song with the lyrics “don’t push me because I’m close the edge”….
“Five people were killed and several others hurt in the Netherlands after a car rammed into a crowd of spectators in what police are calling a premeditated attack on the royal family.”
“The motive for the attack was unclear. Dutch media, citing neighbors, said the assailant recently was fired from his job and was to be evicted from his home. Police identified him as a 38-year-old Dutch man with no history of mental illness or police record, but they would not release his name.” More of the story HERE
How is the crisis affecting certain criminal activity’s?
The Mafia in Italy (and I am sure everywhere else) is finding lots to exploit:
“While businesses around the world are hunkering down for survival, the Italian mob is living a golden moment.
Italy’s various organized crime syndicates — often lumped together colloquially as Mafia Inc. — are gobbling up gas stations, muscling in on supermarket franchises, making loans to cash-starved businesses, taking over trattorias and acquiring buildings in swank neighborhoods in Rome and Milan, investigators say.
These mobsters have lots of what is in short supply for many businesses these days — liquidity — as well as centuries-honed expertise in preying on the vulnerable, whose ranks are swelling in the current financial crisis.
It all means the mob is free to sink cash into two areas that lie at the heart of the global meltdown: real estate and credit markets.
The crime syndicates are flush with billions of euros from extortion rackets, drug trafficking and booming sales in fake designer clothing made in China expressly for the Italian mob — an increasingly lucrative trade as hard-hit consumers search for bargains, prosecutors and police said in recent interviews.
For the mob bosses, the global economic meltdown “is only an advantage,” said anti-mafia prosecutor Franco Roberti, in his office in Naples, the chaotic port city that is home to the Camorra, one of the Italy’s major crime syndicates.” See full story HERE
And Brothels in Germany (and again, I am sure in other countries) are offering discounts and “extras” : It has not taken long for the global financial crisis to affect the world’s oldest profession in Germany.
In one of the few countries where prostitution is legal, the industry has responded with an economic stimulus package of its own: modern marketing tools, rebates, discounts and gimmicks to boost falling demand.
Some brothels have cut prices or added free promotions, while others have introduced all-inclusive flat-rate fees. Free shuttle buses, discounts for seniors and taxi drivers, as well as “day passes” are among marketing strategies designed to keep business going.
“Times are tough for us too,” said Karin Ahrens, who manages the Yes, Sir brothel in Hanover. Revenue had dropped by 30 per cent at her establishment, she said, while turnover had fallen by as much as 50 per cent at other clubs. “We’re definitely feeling the crisis. Clients are being tight with their money. They’re afraid. You can’t charge for the extras any more and there is pressure to cut prices.” See full story from The Independent HERE
Spain ends up at the top for highest unemployment.
From the Telegraph:
More than four million Spanish people are out of work. According to the country’s National Statistics Institute a record high figure of 17.4 per cent were unemployed in the first quarter of the year.
Unemployment leapt from 13.9 per cent in the fourth quarter of 2008, the biggest quarterly jump since 1976. Joblessness in Spain has almost doubled in a year.
The Bank of Spain had previously forecast that unemployment would not surpass 17.1 per cent for the year. Alarmingly, 1,068,400 families have every member out of work.
And as the dole queues lengthen, labour unrest is growing. Two hundred pickets yesterday picketed a shipyard in the Basque country to protest at the employment of cheap Romanian and Portuguese workers that is threatening the jobs of 1,100 local workers. See full story HERE
Of course its the working men and woman who feel the brunt of the greedy thieves, and Britain is especially hard hit where “workers in Birmingham on half pay, IT contractors in Yorkshire on slashed rates, office workers in London rehired on 25% less, and the women suffering £400-a-month wage cuts because of equal pay rules”. See full story from The Guardian UK
” HERE
How bad is bad?
“The US economy has begun to deflate for the first time in more than half a century as a slump in demand pushes energy and food costs lower.
The consumer price index fell at an annual rate of 0.4% in March, the first decline since August 1955, figures from the US labour department showed today. It was bigger than the 0.1% drop expected by economists.” See fulls story from The Guardian UK HERE
America is devolving into a third-world nation. And if we do not immediately halt our elite’s rapacious looting of the public treasury we will be left with trillions in debts, which can never be repaid, and widespread human misery which we will be helpless to ameliorate. Our anemic democracy will be replaced with a robust national police state. The elite will withdraw into heavily guarded gated communities where they will have access to security, goods and services that cannot be afforded by the rest of us. Tens of millions of people, brutally controlled, will live in perpetual poverty. This is the inevitable result of unchecked corporate capitalism. The stimulus and bailout plans are not about saving us. They are about saving them. We can resist, which means street protests, disruptions of the system and demonstrations, or become serfs. See full story HERE at TRUTHDIG
Thousands of cross-Channel ferry passengers faced a second day of travel disruption today as French fishermen continued a blockade of ports in protest against EU quotas.
P&O Ferries said it was forced to suspend services from Dover at 6am as protests restarted off Calais, just nine hours after they ended.
Three thousand passengers, including families returning from Easter holidays, had to be helped home overnight after being stranded at the ports.
Blockades at Boulogne and Dunkirk remained in place. P&O advised passengers on day trips to make alternative arrangements while others were told to head to Dover but to get there early because of extra security. The company is planning to sue the French government for compensation for the disruption. See story HERE
Where are those sharpshooters when you really need them?
“City bankers are set to pocket huge bonuses again, despite bringing the world economy to the brink of ruin.
Goldman Sachs yesterday promised thousands of staff – 5,500 of them in the UK – a 33 per cent pay boost after it returned to profit.
Other banks are expected to follow suit after benefiting from trillions of pounds in government bailouts.
Last night angry MPs condemned what they said was ‘business as usual’ for City fat cats. Goldman Sachs was accused of ‘taking the mickey’ out of taxpayers with such massive bonuses during a global recession. “
See full story HERE
From The Financial Times:
Is the US Russia? The question seems provocative, if not outrageous. Yet the person asking it is Simon Johnson, former chief economist at the International Monetary Fund and a professor at the Sloan School of Management at the Massachusetts Institute of Technology. In an article in the May issue of the Atlantic Monthly, Prof Johnson compares the hold of the “financial oligarchy” over US policy with that of business elites in emerging countries. Do such comparisons make sense? The answer is Yes, but only up to a point.
“In its depth and suddenness,” argues Prof Johnson, “the US economic and financial crisis is shockingly reminiscent of moments we have recently seen in emerging markets.” The similarity is evident: large inflows of foreign capital; torrid credit growth; excessive leverage; bubbles in asset prices, particularly property; and, finally, asset-price collapses and financial catastrophe. See full story HERE
Mainland Europe is bracing itself for thousands more job cuts as Philips warned of further restructuring to staunch mounting losses and the German arm of Woolworths filed for bankruptcy.
In Switzerland the country’s biggest bank, UBS, is reportedly planning to axe up to 10,000 more jobs as early as next week as it struggles to regain profitability – and credibility.
And as ArcelorMittal, the world’s biggest steelmaker, confirmed it would cut output by half and mothball several plants, unions urged the group to retain the current workforce in readiness for any upturn.
Dutch group Philips, one of the earliest continental firms to report first-quarter earnings, said it had already axed 5,216 jobs this year and the number of its employees had fallen by 18,030 in a year, with 5,600 due to discontinued operations.
Warning that demand in the current quarter would be weak after slumping more than expected in the first three months, the world’s biggest lighting business and Europe’s biggest consumer electronics firm said: “Consequently, we will accelerate measures to further lower our fixed cost base.” See full story from The Guardian HERE
An Argentine opinion on the Global Financial Crisis, describing the whole Global Financial System as one vast Ponzi Scheme.
See Here
Incredible piece in The New Rolling Stone by MATT TAIBBI:
People are pissed off about this financial crisis, and about this bailout, but they’re not pissed off enough. The reality is that the worldwide economic meltdown and the bailout that followed were together a kind of revolution, a coup d’état. They cemented and formalized a political trend that has been snowballing for decades: the gradual takeover of the government by a small class of connected insiders, who used money to control elections, buy influence and systematically weaken financial regulations.
See full article HERE
Here comes the summer of rage?
A warning of more attacks on UK bankers was made on Wednesday after the home of former Royal Bank of Scotland boss Fred Goodwin was vandalized.
Windows were smashed in Goodwin’s house in the Scottish capital Edinburgh and those of a Mercedes-Benz limousine parked outside.
It is not known if anyone was at home at the time. Goodwin — dubbed “Fred the Shred” by the media for his ruthless cost-cutting — and his family have not been living in the house since it was revealed that the 50-year-old Goodwin was receiving an annual pension of $1 million (£700,000) for life.
A statement issued to media organizations including the Press Association after the attack said: “We are angry that rich people, like him, are paying themselves a huge amount of money and living in luxury, while ordinary people are made unemployed, destitute and homeless.
“Bank bosses should be jailed. This is just the beginning.”
No group was named in the message and it did not explicitly claim responsibility for the attack.
Goodwin took early retirement after RBS nearly collapsed amid the economic crisis and was later part-nationalized.
On the same day as the size of his pension was revealed RBS announced a UK record loss of $34.6 billion (£24.1 billion) for 2008.
Politicians and commentators have expressed fury about the deal and excessive bonuses being given by bailed-out banks. See more from CNN HERE
The Czech government collapsed Tuesday after losing a parliamentary no-confidence vote over its handling of the economic crisis.
It was a huge embarrassment for Prime Minister Mirek Topolanek, coming just days before a planned visit by President Barack Obama and midway through the Czech Republic’s six-month European Union presidency.
The lower house of Parliament voted 101-96 to declare no confidence in the three-party coalition government, after four lawmakers broke rank with their parties and voted with the opposition. Three legislators were absent from the vote.
It was the first time a government has been ousted by parliament since the country came to existence after the 1993 split of Czechoslovakia.
Topolanek said he could resign after a planned trip to Brussels on Wednesday. “I take the vote into account and will act according to the Constitution,” he said.
There has been no indication of whom President Vaclav Klaus might choose to form a new Cabinet. If three attempts to form a government fail, early elections must be called.
Topolanek’s minority coalition took charge in January 2007, after months of difficult negotiations following 2006 general elections that resulted in no clear winner.
The government has struggled to resolve deep divisions within Parliament over whether to allow components of a U.S. missile defense shield on Czech territory, and whether to adopt the EU reform treaty to streamline decision-making in the bloc.
Story continues below
In recent months, opposition lawmakers also said they became frustrated with the government’s response to the global economic slowdown. Before the crisis, the Czech Republic’s export-oriented economy had been growing fast, but the country is expected to enter a recession this year. Annual industrial output fell 23.3 percent in January.
The opposition said the government acted too late and did too little _ approving a stimulus package only last month worth 70 billion koruna ($3.5 billion), including measures for investments in ecology and infrastructure along with tax cuts and loan guarantees.
“The government got what it deserved,” said former Prime Minister Jiri Paroubek, who leads the opposition Social Democratic party. “It was not able to handle the affects of the economic crisis.” Paroubek said, however, that he was not against Topolanek’s government staying in office until the end of the Czech term leading the EU presidency.
The European Union executive said it trusted the Czech Republic would be able to continue its duties in the EU presidency.
“It is for the Czech Republic’s democratic process under the constitution to resolve the domestic political issues; the Commission is confident that this is done in a way which ensures the full functioning of the Council Presidency,” the European Commission said in a statement.
Meanwhile, it will likely be left to a new government to deal with the two other main issues in Czech Parliament _ the proposed U.S. missile defense project and the EU reform treaty.
The Czech Parliament’s lower house has passed the so-called Lisbon Treaty, but the upper house _ controlled by Topolanek’s own Euro-skeptic party _ has yet to vote on it. All 27 EU nations must approve the treaty for it to take effect.
The government’s deal to allow a U.S. radar base near Prague is also up in the air. Topolanek was forced last week to withdraw legislation on the U.S. missile defense plan from lower house because he did not have enough votes to ensure it would pass.
The missile defense shield was likely to be high on the agenda during Obama’s visit April 4-5 to Prague. Obama has never said if the U.S. will go ahead with the deal, brokered under President George W. Bush.
The opposition has argued against the missile defense plan because it could anger Russia, which has vehemently opposed the missile shield within its former sphere of influence. Washington has said the shield, also including 10 interceptor missiles to be housed in neighboring Poland, would protect Europe from attacks by “rogue states” in the Middle East. See more from The Huffington Post
HERE
Technically, the U.S. is already “bankrupt” because it has a debt that is almost four times the size of its economy, says Puru Saxena, CEO of Puru Saxena Wealth Management. He tells CNBC that the U.S. is at risk of hyperinflation. See HERE
France faces a “class war” that could undermine President Nicolas Sarkozy’s reform efforts and spark a period of damaging labour unrest, one of the country’s most prominent business leaders has warned.
In an interview with the Financial Times as France braced for its second national strike in less than two months, Maurice Lévy, head of Publicis, said “people are really angry” over the country’s growing economic hardship and costly bank rescues.
EDITOR’S CHOICE
Workers pile pressure on Sarkozy – Mar-18
Brussels and France resolve auto dispute – Mar-02
France softens plan to deny aid to carmakers – Feb-26
Sarkozy pressed to add social element to plan – Feb-18
Lex: French car industry – Feb-13
French aid to car industry remains under fire – Feb-13
Mr Lévy criticised the government for fanning the discontent. The boss of the advertising group said ministers had failed to explain adequately why the state had bailed out banks while refusing to help consumers with new tax breaks or wage rises.
Unions have promised another record turnout for Thursday’s general strike, with more protests planned across the country than in January when up to 2.5m people came out on to the streets.
The public mood has worsened, with protests becoming militant amid factory closures and as the government struggles to revive the economy. See full story from the Financial Times HERE
A must read from economist James K. Galbraith:
“The most likely scenario, should the Geithner plan go through, is a combination of looting, fraud, and a renewed speculation in volatile commodity markets such as oil. Ultimately the losses fall on the public anyway, since deposits are largely insured. There is no chance that the banks will simply resume normal long-term lending. To whom would they lend? For what? Against what collateral? And if banks are recapitalized without changing their management, why should we expect them to change the behavior that caused the insolvency in the first place?
The oddest thing about the Geithner program is its failure to act as though the financial crisis is a true crisis—an integrated, long-term economic threat—rather than merely a couple of related but temporary problems, one in banking and the other in jobs. In banking, the dominant metaphor is of plumbing: there is a blockage to be cleared. Take a plunger to the toxic assets, it is said, and credit conditions will return to normal. This, then, will make the recession essentially normal, validating the stimulus package. Solve these two problems, and the crisis will end. That’s the thinking.” See more HERE
A revolution is brewing as American patriots and free-market advocates unite in protest against out-of-control government spending – with a wildfire movement of more than 170 nationwide tea parties. See full story and video from World Net Daily HERE
On the heels of the recent ruling changing the laws about accepting large denominations of euros which possibly stimulated the economy and definitely helped the mafias and criminal gangs, comes this:
“Spain is offering impunity for those bringing money into the country from financial havens to buy public debt
The Spanish Government has announced that it has prepared, via a Royal Decree, a method to invest in public debt in Spain bringing in the money from financial havens, which will grant total impunity to the owners of the cash.
In addition such money will not be subject to tax, and the Royal Decree also cancels the obligation to declare the identity of the owner if non-resident, its country of precedence, and the amount involved.”
When a country is so broke that it is practically begging for dirty money, you know how bad things really are.
See full story HERE
From Reuters: Private equity company Blackstone Group LP (BX.N) CEO Stephen Schwarzman said on Tuesday that up to 45 percent of the world’s wealth has been destroyed by the global credit crisis.
“Between 40 and 45 percent of the world’s wealth has been destroyed in little less than a year and a half,” Schwarzman told an audience at the Japan Society. “This is absolutely unprecedented in our lifetime.”HERE
From The Telegraph:
Investors take out short trades when they expect a currency to fall. In recent days, futures traders in the US have significantly increased their bets that the euro will fall against the dollar. Data released by the Washington-based Commodity Futures Trading Commission on Friday showed that the “net short position” of trades against the euro by hedge funds and speculators almost doubled in the week to March 3 to 19,431 contracts from 10,081 contracts a week earlier.
“Quite a significant correction in the euro is coming in the next few months. The European Central Bank (ECB) is behind the curve in getting to grips with its economic problems,” said David Buik of BGC Partners. He added that the eurozone entered recession later than other economies, but policy-makers had been too slow to act, putting the currency at risk.
The global recession means that the euro is facing its strongest test since its launch a decade ago as the less productive countries such as Spain, Greece and Italy have failed to match the efficiency of some of Europe’s faster growing economies. See full story HERE
I really don’t know how much more of this I can take.
The federal agency that insures bank deposits, which is asking for emergency powers to borrow up to $500 billion to take over failed banks, is facing a potential major shortfall in part because it collected no insurance premiums from most banks from 1996 to 2006.
The Federal Deposit Insurance Corporation, which insures deposits up to $250,000, tried for years to get congressional authority to collect the premiums in case of a looming crisis. But Congress believed that the fund was so well-capitalized – and that bank failures were so infrequent – that there was no need to collect the premiums for a decade, according to banking officials and analysts. See story from BOSTON.COM HERE
Take the money (and the cars) and run!
Scores of new cars vanished from a western Nebraska car dealership and a prosecutor said Wednesday that some had turned up in other states and warrants had been issued for three missing executives.
The 81 Fords and Toyotas taken from Legacy Auto Sales in Scottsbluff were valued at about $2.5 million.
The Fords were put on transporter trucks and taken away Saturday and the Toyotas were shipped out late Monday, John Childress, Scotts Bluff County’s chief deputy county attorney, said Wednesday.
Childress said arrest warrants had been issued for owner Allen Patch, controller Rachel Fait and general manager Rick Covello, who are wanted on suspicion of theft.
“Employees were expecting these people to be in Tuesday morning, and they were surprised no one was there,” Childress said. “It is not an expected departure.”
See the rest of the story from FOX HERE
From Bloomberg.com: The value of global financial assets including stocks, bonds and currencies probably fell by more than $50 trillion in 2008, equivalent to a year of world gross domestic product, according to an Asian Development Bank report.
Asia excluding Japan probably lost about $9.6 trillion, while the Latin American region saw the value of financial assets drop by about $2.1 trillion, said Claudio Loser, a former International Monetary Fund director and the author of the report that was commissioned by the ADB. The report didn’t give a breakdown of asset declines in other regions.
“The loss of financial wealth is enormous, and the consequences for the economies of the world will unfortunately commensurate,” said Loser, now the Latin American president of strategic advisory firm Centennial Group Inc.. “There are serious economic and political stumbling blocks that may well cause the recovery to be costly and slow to consolidate.” See story HERE
From AdAge: The economy might be tanking, but firearm sales are going great guns. Despite the weakest holiday season on record, outdoor-products retailer Cabela’s turned in strong fourth-quarter sales, largely as a result of an increase in firearm and ammunition sales. Smith & Wesson is reporting pistol sales up 40%, and Sturm, Ruger & Co. reported an 81% increase in firearm revenue. See story HERE
From Reuters: With “no end in sight” for U.S. job losses amid a recession that could stretch into 2010, American workers will soon have to contend with another blow to their confidence: stagnant, or even falling wages.
Job seekers — already coping with the highest unemployment rate in a quarter century, their savings mugged by a plunging stock market — can also expect lower pay once they land a new job, labor market experts say, because the current downturn shows no signs of turning around anytime soon. See story HERE
From The Telegraph: Thousands of extra therapists are being trained amid Government fears that the financial crisis could drive up levels of mental illness and long-term unemployment. See full story HERE
And in the USA the competition is so bad that a school received over 700 applications for a low paying janitorial job. From Yahoo News: Evidence of the slumping economy is stacking up at an Ohio school which has nearly 700 applications for one open janitorial job.
Officials at Perry Local Schools near Canton in northeast Ohio say they’ve extended the deadline until Monday to accommodate the overwhelming response to the week-old posting. The full-time position at Edison Junior High School pays $15 to $16 an hour plus benefits. See full story HERE
The world economy is on track to post its worst performance since the Great Depression, with developing countries bearing much of the economic pain, the World Bank said Monday.
Those countries face a credit shortfall of up to $700 billion, the bank said.
“The global economy is likely to shrink this year for the first time since World War II,” the bank said, noting that global industrial production, by the middle of 2009, could be as much as 15% lower than in 2008.
Based on those projections, world trade is on track to record its largest decline in 80 years, with the sharpest losses expected in East Asia. More from CNN Money HERE
How long before we see more of these kinds of actions worldwide?
A bomb exploded outside a Citibank branch in Athens early Monday causing damage but no injury.
A police statement said the bomb went off at 3 a.m. local time (0100 GMT) Monday in the Nea Ionia district of the capital. The device had been planted behind the two-story bank building, which suffered moderate damage.
There was no claim of responsibility for the attack, and police said they had received no warning call.
Police said the bomb was detonated from very close to the blast site, with the use of electric cables. A police spokeswoman said the attackers used “a medium-sized improvised device,” and the damage to the building was not severe. She was speaking on customary condition of anonymity.
The target of the attack pointed to Greek far-left militant groups, which have become increasingly aggressive following the police shooting of a 15-year-old boy in December — an incident that sparked the country’s worst riots in decades. See full article HERE
worse than the Depression.
Comments (15)
Some bleak predictions from Morgan Stanley this morning including the forecast that UK profits could fall by 60% in the current downturn – a worse performance than the great depression of the 1930s. See full article from The Guardian HERE
Was Milton Friedman correct in predicting trouble for the Euro?
From The Telegraph:
During the current crisis we have several times heard invoked the wisdom of Milton Friedman about the unfeasibility of the euro as a currency surviving a recession. In an interview not long before his death three years ago, Friedman said: “The euro is going to be a big source of problems, not a source of help. The euro has no precedent. To the best of my knowledge, there has never been a monetary union, putting out a fiat currency, composed of independent states. There have been unions based on gold or silver, but not on fiat money – money tempted to inflate – put out by politically independent entities.” See full story HERE
Is the Ukraine about to face a run on the Banks? From the Financial Times:
Olexander Pavlenko, a young computer programmer, is one of tens of thousands of Ukrainians who cannot get their money out of the bank.
He stood in line in Kiev at Nadra Bank and Ukrprombank, two big troubled banks, planning to withdraw more than $10,000 (€7,950, £7,125). But like many others, he was told the cash was not available.
“I stood in line a couple times with other bank clients who were protesting, crying and screaming. But the bank told me: ‘Sorry, we simply don’t have the money now and can’t help you.’”
With about nine banks now under the central bank’s special control, Ukrainians are increasingly worried.
See story HERE
The global recession is set to be deeper than already pessimistic forecasts, according to the Organisation for Economic Cooperation and Development (OECD), which warned that protectionist measures will only intensify the financial crisis. See full story from THE TELEGRAPH HERE
So much for a compelling display of European unity. A disastrous summit in Brussels at the weekend laid bare what everyone already knew: the global economic crisis is threatening to tear apart both the continent’s single market and the peaceful transition to a prosperous European era after the dissolution of the USSR.
Mirek Topolanek, prime minister of the Czech Republic, one of the first former Eastern Bloc countries to hold the European Union’s rotating presidency, warned of “the greatest crisis in the history of European integration”. Ferenc Gyurcsany, his Hungarian counterpart, spoke of fears that the economic meltdown would lead to the abandonment of poor by rich, of East by West. “We do not want any new dividing lines. We do not want a Europe divided along a North-South or an East-West line … We should not allow a new Iron Curtain to be set up.”
But disputes between East and West were very much in evidence. Germany scoffed at Hungary’s call for a mass bail-out of economies near the brink in eastern Europe. The French, who recently handed the EU presidency to the Czechs, continued to act like disruptive back-seat drivers. Nicolas Sarkozy openly suggested the Czechs were not up to the task of running the EU. See story from THE TELEGRAPH HERE
When the United States sneezed, Old Europe’s banks caught a heavy cold, and New Europe’s mini-tiger economies have succumbed, one by one, to a nasty bout of flu. But in the so-called neighbourhood states immediately to the east, chief among them Ukraine, pneumonia threatens – and the experts’ prognosis is not good.
International financiers will say, without wanting to be quoted, that Ukraine is already, for all practical purposes, bankrupt. They do not like the D-word, default, though that is clearly on their mind. Ukrainian officials like the word still less, smacking as it does of national humiliation. But the taboo was broken in recent days, when a senior IMF official, Marek Belka, director of the fund’s European department, was quoted in the Ukrainian press as rejecting that idea. Which, in many Ukrainian minds, only made the prospect more real.
D-day – in almost every sense – could come as early as next Saturday when Ukraine has to pay its next instalment for Russian gas deliveries under the agreement painfully negotiated in January. It is grimly forecast that Kiev will not be able to pay, so triggering a new cut-off. Even if this particular Armageddon is averted, there is still April – when the warmer days of spring will still be only on the horizon. See story from the THE INDEPENDENT HERE
More than 140,000 manufacturing jobs will be lost this year in the wake of a “dramatic” downturn that continues to cut deeper into British industry, says a report published today.
The Engineering Employers Federation (EEF) said research among almost 800 companies made “grim reading”, with a slump in output and orders, increasing job cuts, huge constraints on cashflow and warnings that the outlook could get worse. See full story HERE
From the Times Online:
Eastern European countries gave an apocalyptic warning yesterday of hordes of unemployed workers heading west as a new Iron Curtain divides rich from poor inside Europe.
Twenty years after the fall of the Berlin Wall, Western leaders were told yesterday that five million jobs could be lost in the “new” European Union countries of the East unless radical action were taken to bail them out.
The spectacular collapse of some of the post-communist tiger economies led to demands at an EU summit in Brussels for a rescue fund of €190 billion (£170 billion) to stop social collapse in the Eastern nations spilling over into the rest of Europe. See more HERE
From The Guardian :
What separates Ireland from Iceland? According to a local joke, the letter C. According to Morgan Kelly, about six months.
The stunning fall of Iceland late last year and the spreading contagion of the financial crisis have ignited fears – fanned by bloggers, analysts and a small group of outspoken economists like Kelly – that Ireland, another small, open economy plagued by deficits and an outsize banking industry with incalculable losses, may suffer a similar fate. See HERE
Fear mongering? Maybe. But then again…
TOP secret contingency plans have been drawn up to counter the threat posed by a “summer of discontent” in Britain.
The “double-whammy” of the worst economic crisis in living memory and a motley crew of political extremists determined to stir up civil disorder has led to the extraordinary step of the Army being put on standby.
MI5 and Special Branch are targeting activists they fear could inflame anger over job losses and payouts to failed bankers.
One of the most notorious anarchist websites, Class War, asks: “How to keep warm during the credit crunch? Burn a banker.” See story
HERE
The sharpest contraction in US growth for more than a quarter of a century, a collapse in Japanese factory output and an emergency package of help for the struggling countries in Eastern Europe provided fresh grim evidence today of the paralysis in the global economy.
Amid fears that the downturn triggered by the credit crunch has turned into the worst slump in output since the 1930s, data from Washington showed that the havoc wreaked by the problems on Wall Street last Autumn was far worse than originally believed. See story from The Guardian HERE
Get the tar & feathers ready!
From The Guardian:
On Tuesday night, 100 billionaires will gather at London’s sumptuous Dorchester hotel, to watch Mr Ted Turner in conversation with Ms Carol Vorderman. Ms Joss Stone will sing, and some model or other will be in attendance. Can you guess the aim of this evening, which I trust you would cross continents to avoid in the infinitely unlikely event that you had been invited? No? Then allow me to assist. The aim is to make the government give tax breaks to the super-rich, in order to tempt them to give the same percentage of income to charity as the poorest 20% of people in this country already do. See full story HERE
Will the neo-cons and Israel finally get what they want? Would it make for a nice diversion from the economic crisis?
With all the anti-Iran stories in the press this past week, I wouldn’t be surprised if an attack on Iran happened soon. Maybe even caused by a nice “false flag”….we will see. See Iran likely has stuff to make nukes, U.S. military chief says
From Bloomberg.com:
German unemployment began to rise last November after almost three years of declines. Deutsche Bank AG Chief Economist Norbert Walter predicts the German economy, Europe’s biggest, may shrink by more than 5 percent this year.
The worst recession since World War II is fueling anger among youths across Europe who “perceive their future as rather precarious,” said Margit Mayer, a politics professor at Berlin’s Free University.
“Whether you look at the Berlin events or these anarchist groups in other European cities and countries, they are all making reference to the deepening economic crisis and how the various governments are dealing with them,” said Mayer, a specialist in urban social and protest movements.
Some groups are “very quick to attack whoever they can make out as responsible for having robbed them of decent life prospects,” according to Mayer. See story HERE
Harvard economic historian Niall Ferguson predicts prolonged financial hardship, even civil war, before the ‘Great Recession’ ends. See interview at The Globe and Mail HERE
A nice observation from over at CHARTING STOCKS.NET:
A few select quotes during the depression years of 1929 to 1931.
Notice the “Expert” opinions which convey optimism, the bank bailouts, government assurances, the Hoover (Paulson) plan, and the deliberate attempt by the main stream media to manufacture consent for bailing out Wall St. Has anything changed?
“There is no cause to worry. The high tide of prosperity will continue”
- Andrew W. Mellon, Secretary of the Treasury. September 1929
Stock Prices Will Stay at High Level For Years to Come, Says Ohio Economist .
-Dr. Charles Amos Dice, professor of business organization at Ohio State October 13, 1929
“FISHER SEES STOCKS PERMANENTLY HIGH”
-Irving Fisher, Yale economist, October 16h, 1929
“BROKERS IN MEETING PREDICT RECOVERY; Partners in 35 Wire Houses at Conference Agree Selling Has Been Overdone.” October 25, 1929
See more HERE
From The Mail Online:
A summer of discontent? It seems a real possibility. Senior officers in the Met are worried. Of course, there are always groups which want to stir up disorder on the slightest excuse or none.
The question in these deeply depressed times is how many people who would normally stay aloof might feel like joining them?
It is difficult to think of a time when so many people of so many ages at so many levels of society have cause to be fed up and fearful for their futures. See full story HERE
In an effort to curb the growing loan deficiencies and defaults, American Express is offering its cardholders a $300 gift card to close their account and pay off the balance by May 1st. See article HERE
Police are bracing themselves for a ’summer of rage’ against the economic crisis, a senior officer warned today.
Superintendent David Hartshorn, who heads the Metropolitan Police’s public order branch, said he feared there could be ‘mass protest’ at rising unemployment, failing financial institutions and the downturn in the economy.
The officer told The Guardian that ‘known activists’ were planning returns to the streets, and intelligence revealed that they may be able to call on more protesters than normal due to the unprecedented conditions. See story HERE
Two videos regarding people protecting themselves and their property, both from the USA. The first one is from Arizona, where a security camera outside a home catches three men armed with guns attempting a home invasion robbery on a home. The homeowner was prepared, and shoots at the assailants, causing them to flee. See video HERE
The second video is a compilation of videos from The LA Rodney King Riots. Its interesting to see, when thinking about how things may go if there are riots caused either directly or indirectly by the worsening economic crisis.
Of special note are the Korean shop owners defending their property with a shoot-out caught live on tape. See HERE
For many immigrants, the Spanish dream is turning into a nightmare as they face layoff risks and increasing higher mortgage payments. See full story from Expatica HERE
“The global economic crisis will create more refugees and fuel xenophobia in some countries, the United Nations refugee chief warned Monday.
Antonio Guterres, the world body’s high commissioner for refugees, told reporters in the Australian capital Canberra that refugees and migrants can expect to be blamed for economic problems that are deepening in many countries.
“In my experience as a politician, I’d say that when things go wrong in a country, there are two potential targets: one is the government, the other is the foreigners,” the former Portuguese prime minister said.
He described the economic crisis as a “generator of xenophobia” in some countries. He did not name any country.
“Xenophobia is an inevitable trend in many parts of the world when the economic situation deteriorates,” Guterres said. See full story HERE
Hundreds of thousands of workers filled the streets of Dublin on Saturday to protest the government response to Ireland’s economic downturn.
Up to 120,000 people attended the peaceful demonstration that included a march from Parnell Square to Merrion Square, Dublin police said. No arrests were made, police said.
The protest was organized by the Irish Congress of Trade Unions (ICTU). Workers from Waterford Crystal and SR Technic, two companies facing economic problems amid the recession, led the march.
Ireland’s economy was booming until last year when it was hit with the most “profound global economic crisis in seventy years,” due in large part to a significant decline in the housing and construction markets, according to the government’s Web site. See full report from The BBC HERE
Over at The Daily Kos a diary on what may be impending doom for Europe. If a 16.3 TRILLION bailout is needed, they will get that money by printing it and you know what that means: See full story HERE
On the edge of a village in south-west France, an expat’s dream is coming to a very public end.
Victoria Butcher has put her house on the market and is also selling all of its contents – everything from the fridge to her children’s clothes.
Even the chickens, so symbolic of the good life, are up for sale (though strictly on the condition that the buyer keeps them for their eggs and does not eat them for Sunday lunch). ‘I am desperate,’ says the softly-spoken 42-year-old, who three years ago left her job with the education authority in Hampshire to seek a better life for her family in France.
‘I am here alone with my three children and I have run out of money. Despite trying for a year, I can’t find a job and can’t sell my house – the buyers have dried up, particularly the British. What else could I do? I have no choice but to sell everything I can.’
And so her neighbours trawl through her belongings, handing over five euros for some
crockery, ten for a wooden chair.
That Victoria’s dream of life in France should come to this is clearly distressing for her. But the sad truth is that she is far from alone.
What the French termed l’invasion anglaise is under serious threat. Across Aquitaine, a region where 30,000 expats live, a silent but steady retreat is being beaten as house contents are packed into removal lorries ahead of the long journey back north.
The British inhabitants here have been hit by a combination of factors. First, France is suffering the effects of the credit crunch like the rest of the world.
Unemployment is already above two million. And when it comes to handingout the few jobs there are, the British aren’t exactly first in line. See story from The Mail Online HERE
A great song by James Mcmurtry that reminds me a little of John Prine, The Boss, Dylan, Lou Reed and Pat Macdonald….
See video and lyrics below
James McMurtry James – We Can’t Make It Here
There’s a Vietnam Vet with a cardboard sign
Sitting there by the left turn line
Flag on his wheelchair flapping in the breeze
One leg missing and both hands free
No one’s paying much mind to him
The V.A. budget’s just stretched so thin
And now there’s more coming back from the Mideast war
We can’t make it here anymore
That big ol’ building was the textile mill that fed our kids and it paid our bills
But they turned us out and they closed the doors
We can’t make it here anymore
See those pallets piled up on the loading dock
They’re just gonna sit there ‘til they rot
‘Cause there’s nothing to ship, nothing to pack
Just busted concrete and rusted tracks
Empty storefronts around the square
There’s a needle in the gutter and glass everywhere
You don’t come down here unless you’re looking to score
We can’t make it here anymore
The bar’s still open but man it’s slow
The tip jar’s light and the register’s low
The bartender don’t have much to say
The regular crowd gets thinner each day
Some have maxed out all their credit cards
Some are working two jobs and living in cars
Minimum wage won’t pay for a roof, won’t pay for a drink
If you gotta have proof just try it yourself Mr. CEO
See how far $5.15 an hour will go
Take a part time job at one your stores
Bet you can’t make it here anymore
There’s a high school girl with a bourgeois dream
Just like the pictures in the magazine
She found on the floor of the laundromatA woman with kids can forget all that
If she comes up pregnant what’ll she do
Forget the career, forget about school
Can she live on faith? Live on hope?
High on Jesus or hooked on dope
When it’s way too late to just say no
You can’t make it here anymore
Now I’m stocking shirts in the Wal-Mart store
Just like the ones we made before
‘ Cept this one came from Singapore
I guess we can’t make it here anymore
Should I hate a people for the shade of their skin
Or the shape of their eyes or the shape I’m in
Should I hate ‘em for having our jobs today
No I hate the men sent the jobs away
I can see them all now, they haunt my dreams
All lily white and squeaky clean
They’ve never known want, they’ll never know need
Their shit don’t stink and their kids won’t bleed
Their kids won’t bleed in their damn little war
And we can’t make it here anymore
Will work for food will die for oil
Will kill for power and to us the spoils
The billionaires get to pay less tax
The working poor get to fall through the cracks
So let ‘em eat jellybeans let ‘em eat cake
Let ‘em eat shit, whatever it takes
They can join the Air Force, or join the Corps
If they can’t make it here anymore
So that’s how it is, that’s what we got
If the president wants to admit it or not
You can read it in the paper, read it on the wall
Hear it on the wind if you’re listening at all
Get out of that limo, look us in the eye
Call us on the cell phone tell us all why
In Dayton Ohio or Portland Maine
Or a cotton gin out on the great high plains
That’s done closed down along with the school
And the hospital and the swimming pool
Dust devils dance in the noonday heat
There’s rats in the alley and trash in the street
Gang graffiti on a boxcar door
We can’t make it here anymore HEREHERE
From Lance Landon at OpEd News
“Could this be an ominous shadow drawing on the end of the United States of America? For years the Federal Government has presumed to be the all-powerful force governing our country, but it just could be that the Federal Government only exists at the pleasure of the state governments and the citizens thereof. States declaring sovereignty sounds like an act of secession and revolution. However the federal government can apparently be dissolved and another one formed anew at the discretion of the states. The existing Federal government may not leave willingly like so many European governments that are replaced routinely and it may engage a military effort with our own soldiers or the likes of a Black Water illegal military invasion to retain total control over us.
United States Federal Government laws are often in violation of the Tenth Amendment, which is perturbing, these events. This is predicated on an earlier provision of the Articles of Confederation, which states that, “Each state retains its sovereignty, freedom, and independence, and every power, jurisdiction, and right, which is not by this Confederation [now Federation] expressly delegated to the United States, in Congress assembled.”
A growing number of states are declaring their sovereignty afforded under the U S Constitution’s Tenth Amendment however the conventional news media are not telling you about what is happening. The State of Washington on Wednesday – 11 February 2009 and most recently, New Hampshire [2009], Montana [2009], Hawaii [2009], Michigan [2009], Missouri [2009], Arizona [2008], Oklahoma [2008], Georgia [1996], and California [1994] all of which have introduced bills and resolutions declaring and reaffirming their sovereignty. Some other states have done this in the past but then let the issue go. Additionally, the states of Colorado, Hawaii, Pennsylvania, Arkansas, Idaho, Indiana, Alaska, Kansas, Alabama, Nevada, Maine, and Illinois are considering similar measures. More well may follow, such as Wyoming and Mississippi. ” See the rest of the story HERE
Renowned investor George Soros said on Friday the world financial system has effectively disintegrated, adding that there is yet no prospect of a near-term resolution to the crisis. See full story HERE
For hundreds of thousands of workers losing their jobs during the recession, there’s a new twist to their financial pain: Even as they’re collecting unemployment benefits, they’re paying bank fees just to get access to their money.
Thirty states have struck such deals with banks that include Citigroup Inc., Bank of America Corp., JP Morgan Chase and US Bancorp, an Associated Press review of the agreements found. All the programs carry fees, and in several states the unemployed have no choice but to use the debit cards. Some banks even charge overdraft fees of up to $20 — even though they could decline charges for more than what’s on the card.
“It’s a racket. It’s a scam,” said Rachel Davis, a 38-year-old dental technician from St. Louis who was laid off in October. Davis was given a MasterCard issued through Central Bank of Jefferson City and recently paid $6 to make two $40 withdrawals. See story from Foxnews HERE
From the New Statesman:
We are living through a crisis which, from the collapse of Northern Rock and the first intimations of the credit crunch, nobody has been able to understand, let alone grasp its potential ramifications. Each attempt to deal with the crisis has rapidly been consumed by an irresistible and ever-worsening reality. So it was with Northern Rock. So it was with the attempt to recapitalise the banks. And so it will be with the latest gamut of measures. The British government – like every other government – is perpetually on the back foot, constantly running to catch up. There are two reasons. First, the underlying scale of the crisis is so great and so unfamiliar – and, furthermore, often concealed within the balance sheets of the banks and other financial institutions. Second, the crisis has undermined all the ideological assumptions that have underpinned government policy and political discourse over the past 30 years. As a result, the political and business elite are flying blind. This is the mother of all postwar crises, which has barely started and remains out of control. Its end – the timing and the complexion – is unknown. See full article HERE
From Tech Ticker:
About 220,000 stores may close this year in America, says our guest, retail consultant Howard Davidowitz of Davidowitz & Associates. As more Americans save and spend less, it’s clear there’s too much retail space. Just visit Web site deadmalls.com and track retail’s growing body count. And luxury retailers? They’re on “life support,” Davidowitz says.
Among the brandname stores Davidowitz says are in trouble:
*
Nordstrom
*
Neiman Marcus
*
Tiffany
*
Jeweler Zale Corp.
*
Saks
*
J.C. Penney
*
Sears
See full story HERE
From Reuters:
Former U.S. Federal Reserve Chairman Alan Greenspan said on Tuesday the current global recession will “surely be the longest and deepest” since the 1930s and more government rescue funds are needed to stabilize the U.S. financial system.See story HERE
From Charting Stocks:
If there’s one thing our readers know, it’s that ChartingStocks.net has made some bold calls in the past which seemed controversial and highly unlikely at the time. Our January 2007 post warned of the coming stock market crash at a time when the market was making new all time highs. In February 2007 we warned about the breakdown of the brokerage stocks and singled out Bear Stearns (Trading at $160), Merrill Lynch (Trading at $87), and Morgan Stanley (Trading at 78). In September 2007, we warned of a selloff in the coming weeks. The market peak and decline began 4 weeks later.
We’re going to make another bold prediction. Bank of America and Citigroup won’t live to see May. The two banks will be nationalized in the coming weeks, and we think that the announcement can come as soon as tomorrow evening (Friday evenings are when major bank announcements and failures occur).See story HERE
From The New York Times:
Cindy Dreeszen and her husband live in one of the wealthiest counties in the United States. They have steady jobs, his at a movie theater and hers at a government office. Together, they earn about $55,000 a year.
But with a 17-month-old son, another baby on the way, and, as Ms. Dreeszen put it, “the cost of everything going up and up,” the couple went to a food pantry last week to ask for some free groceries.
“I didn’t think we’d even be allowed to come here,” said Ms. Dreeszen, 41, glancing around at the shelves of fruit, whole-wheat pasta and baby food. “This is totally something that I never expected to happen, to have to resort to this.”
Once a crutch for the most needy, food pantries have responded to the deepening recession by opening their doors to what one pantry organizer described as “the next layer of people,” a rapidly expanding group of child-care workers, nurse’s aides, real estate agents and secretaries who are facing a financial crisis for the first time. Over all, demand at food banks across the country increased by 30 percent in 2008 from the previous year, according to a survey by Feeding America, which distributes more than two billion pounds of food every year. And while pantries usually see a drop in demand after the holiday season, many in upscale suburbs this year are experiencing the opposite. See story HERE
From The Guardian UK:
A recent outbreak of protests across Russia has led to a great deal of excitement among commentators. Vladimir Putin’s centralised “power vertical” is apparently crumbling; protests are set to sweep the country and lead to his downfall.
After several years of quiet on Russia’s streets, it’s easy to overestimate the protests’ significance. In fact, they are small, sporadic and localised, and do not, as yet, pose a real threat to the leadership. But they do reveal a fundamental weakness in the political system and a threat to its stability.
From Safe Haven:
Milton Friedman famously predicted that the euro would not last past their first economic crisis. This week we look at commentary by Niels Jensen that explores the news from Euroland. Can the euro survive? He explores a number of options which are most definitely not on the radar screen for most investors. It is good to get a perspective from those outside of our own back yard. HERE
A man who told a sheriff’s dispatcher he had money problems strangled his wife and 11-year-old son, then shot and killed himself, authorities said Wednesday.
Theodore Bayly, 39, called the dispatcher around 2 a.m., saying he had already killed his family and was going to take care of himself, Noble County Sheriff Landon Smith said.
Bayly told the dispatcher in a seven-minute call that he was having financial problems and “couldn’t afford it anymore,” Smith said. He told the dispatcher where to find the bodies and then hung up. See story HERE
From Ambrose Evans-Pritchard at The Telegragh:
If mishandled by the world policy establishment, this debacle is big enough to shatter the fragile banking systems of Western Europe and set off round two of our financial Götterdämmerung.
Austria’s finance minister Josef Pröll made frantic efforts last week to put together a €150bn rescue for the ex-Soviet bloc. Well he might. His banks have lent €230bn to the region, equal to 70pc of Austria’s GDP.
“A failure rate of 10pc would lead to the collapse of the Austrian financial sector,” reported Der Standard in Vienna. Unfortunately, that is about to happen.
The European Bank for Reconstruction and Development (EBRD) says bad debts will top 10pc and may reach 20pc. The Vienna press said Bank Austria and its Italian owner Unicredit face a “monetary Stalingrad” in the East.
Mr Pröll tried to drum up support for his rescue package from EU finance ministers in Brussels last week. The idea was scotched by Germany’s Peer Steinbrück. Not our problem, he said. We’ll see about that.
Stephen Jen, currency chief at Morgan Stanley, said Eastern Europe has borrowed $1.7 trillion abroad, much on short-term maturities. It must repay – or roll over – $400bn this year, equal to a third of the region’s GDP. Good luck. The credit window has slammed shut. See the rest of the story HERE
US, UK, Eurozone Banks Face Collapse: Global Banking System Insolvent. Will Eastern Europe drag the rest of down into the abyss? See HERE
A nice read from Richard Florida at The Atlantic:
No place in the United States is likely to escape a long and deep recession. Nonetheless, as the crisis continues to spread outward from New York, through industrial centers like Detroit, and into the Sun Belt, it will undoubtedly settle much more heavily on some places than on others. Some cities and regions will eventually spring back stronger than before. Others may never come back at all. As the crisis deepens, it will permanently and profoundly alter the country’s economic landscape. I believe it marks the end of a chapter in American economic history, and indeed, the end of a whole way of life.
“One thing seems probable to me,” said Peer Steinbrück, the German finance minister, in September 2008. As a result of the crisis, “the United States will lose its status as the superpower of the global financial system.” You don’t have to strain too hard to see the financial crisis as the death knell for a debt-ridden, overconsuming, and underproducing American empire—the fall long prophesied by Paul Kennedy and others. See story HERE
Will the way of life is Spain be changed forever due the crisis?
The Financial Times thinks so:
When a top soccer club in a country as fanatical about the game as Spain fails to pay its players, it is a warning that something may be drastically wrong with one of Europe’s most successful economies.
David Villa (below), scorer of Spain’s first goal in the victory last week over England in Seville, is a member of the Valencia squad whose latest salary payment has been delayed indefinitely by the heavily indebted club. He is just one of the growing number of victims, rich and poor, of a plunge into a recession that is on course to be among the steepest in Europe.
The strains are starting to show in Spain’s normally easygoing society. African residents and street hawkers demonstrated twice last week in the Madrid district of Lavapiés against alleged racism and police raids; it subsequently emerged that police in the capital had been given weekly quotas for arresting illegal immigrants. In Andalucia to the south, thousands of other immigrants without food or shelter flooded into country towns at the start of the winter, hunting in vain for olive harvesting work that had already been taken by Spanish job-seekers. See full story
HERE
And The European Commission has, for the first time, started the process to sanction Spain for breaking through the 3% limit for the public deficit with respect to the G.D.P. predicted in the Pact for Stability and Growth.
This year the deficit is expected to be more than 6% of G.D.P, having reached 3.4% last year. Procedures have also been started against Ireland, Greece, France, Latvia and Malta. See story HERE from Typically Spanish.
From Rueters:
” A senior aide to French President Nicolas Sarkozy warned that countries risked seeing explosions of popular anger comparable with the riots seen in Greece unless governments provided some protection to industry.
Henri Guaino, one of Sarkozy’s inner circle of advisers, told Le Monde that without some commonly agreed rules on reasonable levels of protection and government intervention more uncontrolled outbreaks of populism and xenophobia were likely.
“We should take this risk very seriously,” he said in an interview which appeared on Tuesday.
He said the riots in Greece, strikes in Britain in protest against foreign temporary workers in the energy sector or anti-government protests in Iceland were an example of what could happen in other countries.
“This crisis is already going through all the chapters of an economics textbook. We should be careful that it doesn’t also go through a history textbook as well,” he said. See full story HERE
From The Independent…
As the cold, hard realities of the global economic meltdown hit home in Russia’s remote industrial ‘monotowns’, Vladimir Putin is facing the first serious challenges to his authority. Is anarchy just around the corner? See story HERE
From Yahoo Tech/Ticker….
There’s no question the American consumer is hurting in the face of a burst housing bubble, financial market meltdown and rising unemployment.
But “the worst is yet to come,” according to Howard Davidowitz, chairman of Davidowitz & Associates, who believes American’s standard of living is undergoing a “permanent change” – and not for the better as a result of:
* An $8 trillion negative wealth effect from declining home values.
* A $10 trillion negative wealth effect from weakened capital markets.
* A $14 trillion consumer debt load amid “exploding unemployment”, leading to “exploding bankruptcies.”
“The average American used to be able to borrow to buy a home, send their kids to a good school [and] buy a car,” Davidowitz says. “A lot of that is gone.”…See story HERE
From The Danger Room at Wired.com…
Imagine you’re on a mission for the military in Iraq and Afghanistan. The job is dangerous. The hours are long. And suddenly, you find out that your pay is about to be cut by sixty percent or more.
That’s the situation facing interpreters, researchers and managers, deployed overseas as part of the Army’s social science program, the Human Terrain System. Since the inception of the project in 2006, these specialists have been generously-paid contractors, serving as cultural counselors to combat units. Earlier this week, however, program manager Steve Fondacaro told workers that they’re all becoming government employees — effective almost immediately. Which means that Human Terrain pay is suddenly not all that generous. One linguist, previously pulling in an annual salary $270,000, will now make about $91,000 — if that person continues his warzone work for the Human Terrain project, that is.
“It feels like a stab in the back,” another program employee says. See story HERE
From The New York Times…
“Worldwide job losses from the recession that started in the United States in December 2007 could hit a staggering 50 million by the end of 2009, according to the International Labor Organization, a United Nations agency. The slowdown has already claimed 3.6 million American jobs.
High unemployment rates, especially among young workers, have led to protests in countries as varied as Latvia, Chile, Greece, Bulgaria and Iceland and contributed to strikes in Britain and France.
Last month, the government of Iceland, whose economy is expected to contract 10 percent this year, collapsed and the prime minister moved up national elections after weeks of protests by Icelanders angered by soaring unemployment and rising prices.
Just last week, the new United States director of national intelligence, Dennis C. Blair, told Congress that instability caused by the global economic crisis had become the biggest security threat facing the United States, outpacing terrorism.” See full story HERE
From Chris Hedges at TruthDig…
““roughly a quarter of the countries in the world have already experienced low-level instability such as government changes because of the current slowdown.” He noted that the “bulk of anti-state demonstrations” internationally have been seen in Europe and the former Soviet Union, but this did not mean they could not spread to the United States. He told the senators that the collapse of the global financial system is “likely to produce a wave of economic crises in emerging market nations over the next year.” He added that “much of Latin America, former Soviet Union states and sub-Saharan Africa lack sufficient cash reserves, access to international aid or credit, or other coping mechanism.”
“When those growth rates go down, my gut tells me that there are going to be problems coming out of that, and we’re looking for that,” he said. He referred to “statistical modeling” showing that “economic crises increase the risk of regime-threatening instability if they persist over a one to two year period.”
Blair articulated the newest narrative of fear. As the economic unraveling accelerates we will be told it is not the bearded Islamic extremists, although those in power will drag them out of the Halloween closet when they need to give us an exotic shock, but instead the domestic riffraff, environmentalists, anarchists, unions and enraged members of our dispossessed working class who threaten us. Crime, as it always does in times of turmoil, will grow. Those who oppose the iron fist of the state security apparatus will be lumped together in slick, corporate news reports with the growing criminal underclass. ” See full story
A “second wave” of countries will fall victim to the economic crisis and face being bailed out by the International Monetary Fund, its chief warned at the G7 summit in Rome. See story HERE
Japan sees their worst economy since World War II…
From CNN “Japan is grappling with its worst economic crisis since the end of World War II, the nation’s economic and fiscal policy minister said Monday. The comments from Kaoru Yosano followed news of Japan’s gross domestic product falling 12.7 percent in the fourth quarter in 2008.
“This is the worst economic crisis in the post-war era,” Yosano said at a press conference, according to Japan’s Kyodo news agency.
The global economic crisis has pummeled Japan, which depends largely on its auto and electronics exports. The slump in exports has led to tens of thousands of layoffs across Japan. See story HERE
And Spain is seeing a sharp rise in Unemployement and those that show up at soup kitchens…
In his bar overlooking the Ebro river as it rushed beneath the elegant footbridge designed by the renowned architect Zaha Hadid, Rafael Moreno glumly surveyed the handful of customers picking at their lunchtime food.
“We have already had to lay people off,” he said. “They were meant to start building offices here, but I can’t see it happening any time soon. This crisis is going to last.”
Moreno’s bar, Bocados, opened last year with riotous success amid the euphoria of Zaragoza’s international Expo fair. The city was booming, and so was Spain. It was the country that was creating most jobs and attracting most immigrants in Europe and it was celebrating its fifteenth consecutive year of economic growth.
Now the empty, rubbish-strewn Expo site, with its pavilions half-gutted and Hadid’s expensive bridge fenced off to the public, is a symbol of Spain’s precipitous fall from a bricks-and-mortar boom to a bust that has given it the developed world’s highest unemployment.
In a country destroying jobs at a breathtaking rhythm, once flourishing Zaragoza and the region around it is declining even faster than the national average – with unemployment up 75% in a year. The shock has already sent protesters on to the city’s streets in their tens of thousands. “If this isn’t fixed: Strike! Strike! Strike!”, they chanted at a recent rally.
With Spain’s property developers queuing up to file for bankruptcy and employees at a local General Motors factory waiting to discover whether their jobs will survive a global restructuring plan to be announced this week, the mood becomes bleaker by the day.
Similar stories are being told across recession-hit Spain, with economists predicting that unemployment will rise from its present level of 14% to 20% by the end of the year. See story from The Guardian HERE
Gerald Celente, of The Trends Research Institute predicts total global economic crisis that will be worse than 1929. See interview HERE
