Former President Bush’s library officially opened last week in Texas.
Last week saw the opening of the George W. Bush Presidential Library and Museum – the 21st such structure erected to the memory of a former president in this country. While the act of erecting what amounts to a shrine to one’s legacy is something one might expect to be relegated to historical dictatorships in Ancient Egypt, at least former Presidents aren’t looked to as gods in their own right – even if some politics find themselves deified for decades to come.
As one would expect, the library is not merely dedicated to Mr. Bush and the events of his eight years in office, but they are conveniently whitewashed for the sake of future generations – the only thing helping Mr. Bush’s poll numbers these days being the actual distance in time between him and January of 2009. You will find plenty of exploitation of the September 11th terrorist attacks, but you’ll also find that since that time Mr. Bush kept the country safe so net-net, that’s a good thing. You’ll find a large painting of he and former British Prime Minister Tony Blair – his #1 ally on the international scene when it came time for the Iraq invasion. Mr. Blair can probably not even count on similar admiration back home, the monarchy at least providing the one good service of preventing chief executives being anything more than the mere politicians they should be.
There is no wing of the library dedicated to his opposition for a woman’s right to choose. There’s no shrine to squeezing as much bigotry and hatred toward same-sex couples as he could from the countryside, riding that national tide of religious-based ignorance to a victory in 2004. Speaking of victories, there’s also nary a peep of the circumstances under which Mr. Bush first assumed office – complete with the legally mystifying ”this counts today and then it’ll never count again” ruling by the Supreme Court in the 2000 Bush v. Gore case.
There is a war room though!
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Job figures for the month of march will be released at the end of this week. The consensus is that job growth will continue at its slow, creeping pace – likely under 200,000 for the month just ended. For the time being, the United States remains a somewhat remarkable positive economic story in a world that is filled with continuous streams of troubling news from the European Union through Japan.
Visually, the continued improvement looks as follows:
Monthly Job Data Since The Great Recession
Of course, there’s still a very long road to go until a full recovery.
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President Obama & Speaker of the House John Boehner are the key players in the “fiscal cliff” negotiations.
In the summer of 2011 there was a rather productive conversation about the national debt and a previously simple Congressional procedure known as the raising of the debt ceiling. The conversation was productive in that it showed off how one of the two main political parties in the United States abjectly failed to comprehend how the United States spends money, borrows money, how debt markets work, and just what the effect of debt markets is on more tangible markets that you or I could touch via our paychecks or the unemployment line.
Whether on purpose or through their own embracing of anti-intelligence, the Tea Party wing of the Republican party managed to become the state personification of a crazed old person calling their credit card company daily and repeating “you know I’m really not sure if I feel like paying my bills anymore”. Stock markets reacted negatively. Businesses reacted by sharply curtailing spending and hiring since they really began to wonder just how far down the rabbit hole partisan politics were going to take us. Bond markets would have reacted negatively if there wasn’t even a larger continuous train wreck going on across the pond in Europe with their continued experiment of “let’s pretend to be a country up until the point we have to make a tough decision” with the Euro.
Eventually there was a deal, the debt ceiling was raised, and the Tea Party did not tank the fragile global economy. The deal, by the way, was to kick the can down to the end of 2011. Professional can kickers were anointed, known as the Super Committee. They proudly stood up and kicked the can even farther away, to the end of 2012. It is now December of 2012, and we’ve found the can.
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Sanford Weill, former chairman at Citigroup and one of the chief proponents of neutering the Glass-Steagall Act, appeared on CNBC last week to suggest maybe megabanks should be broken up after all.
One of the more eager and vocal proponents for ending the New Deal-era Glass-Steagall act in the 1990s was Sanford Weill. Mr. Weill was a former chairman at Citigroup – a company that was, for all intents and purposes, illegally created in 1998 by the merger between the bank Citicorp and the insurance giant Travelers. Firewalls were erected by the Glass-Steagall Act that prevented commercial banks from merging with insurance companies and investment banks – preventing potential conflicts of interest that could lead to massive amounts of corruption and a bubble-and-burst cycle that could do serious damage to the economy, as had happened in the 1920s. Had the Glass-Steagall Act remained, Citigroup would have been forced to spin off its insurance business (the company Travelers) within a two-to-five year period. That never came to pass though – within a little more than two years after Mr. Weill oversaw the Citigroup merger, Congress would bring down the firewalls that kept those institutions from merging with each other. Citigroup was validated and, amazingly enough, massive amounts of corruption and a bubble-and-burst cycle that did serious damage to the economy soon followed.
A net worth in the millions and very comfortably secured from the economic realities of what he lobbied for in the name of profit, Mr. Weill has made headlines in recent days over his mea culpa-esque pronouncement that the big banks created directly as a result of the neutering of Glass-Steagall should themselves be broken back up. In an interview on the subject with CNBC, Mr. Weill said the following:
I am suggesting that [big banks] be broken up so that the taxpayer will never be at risk, the depositors won’t be at risk, the leverage of the banks will be something reasonable… I want us to be a leader… I think the world changes and the world we live in now is different from the world we lived in ten years ago.
Irony in his statement laid on very thick since President Clinton heralded the death of Glass-Steagall’s teeth in 2000 with the announcement:
Today what we are doing is modernizing the financial services industry, tearing down those antiquated laws and granting banks significant new authority.
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Somewhere on the right half of this chart may be the one of the largest financial scandals of the 21st century.
We have for some time lived in a world where a bit above all of our heads exists a rather complex financial world. Far beyond “I’ll trade you this paper for that thing”, it spirals into quotes of value’s value of value which by the time whatever ‘it’ was makes its way back to the real world, it comes in the form of the interest rate you might pay on a loan for a house, your credit card, student loans – or what your local and state governments might pay on loans to issue debt. “Debt” might have a negative connotation to certain tricorne hat-wearing really concerned citizens but it has very useful and practical purposes. Issuing short-term debt, for example, is how many companies of all shapes and sizes make payroll, purchase equipment, fund transactions – do business. Far from a credit-addicted hoarder that it may sound, the debt is needed to bridge the gap from now until money is received for whatever is sold.
A scandal has emerged in the public light this month in which some of the biggest banks in the world apparently colluded on the reporting of a key rate that had direct and tangible effects on the pricing of literally hundreds of trillions of dollars of assets – including but not limited to every sort of loan that you could possibly imagine. It would be the manipulation of one of the key pillars of the economy as it works today, and lawsuit liabilities could decimate the profits of these large banks for years to come – not to mention further shattering the confidence that the public has in the financial sector, not that the events of The Great Recession have left us with much to begin with.
What has begun with a probe in England could end up realizing the most flagrant-sounding charges from skeptics of our financial system: maybe the whole thing is a game and it is rigged, after all.
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Health care workers have joined the chorus against austerity for some time. Like all other requests for the policy to stop, though, their wishes go unanswered.
In the same vain as the story about TB making a comeback in the state of Florida, helped along by cuts to medical facility funding in the name of austerity, we would be remiss to not revisit austerity’s live and furthest along test bed: Greece.
Last October, The Lancet released a report on how quality of life has deteriorated in Greece as austerity’s grip continued to tighten on the country. With universal health care a basic right for every citizen of Greece, the demands from wealthier European nations that Greece gut all social spending without care to the rammifications means that said health care system was savaged by the demands. Those negative effects of less care and worsening quality available to the average Greek citizen made its way down through society with tragic, yet very predictable results.
For all the information that follows, keep in mind this was back when Greece’s unemployment was “only” 16.3% (start of 2011 4th quarter) – it has since increased to 22.6% for the 2nd quarter of 2012. GDP annual growth rates declined by another 5% in Q4 2011, 7.5% in Q1 2012, and 6.5% in Q2 2012. The economic situation in Greece has not only worsened since the time of this report, it has done so dramatically.
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53 months into the employment recession and you are here. You will remain here for a long time to come.
It has now been more than 53 months since the start of the employment recession that precluded the full on economic one. Four years and five months ago the unemployment rate was hovering around 4.5% – still stubbornly high when viewed against the previous good times in the late 1990′s, when that number reached as low as 3.9%. Our sights seemed to be set so much higher back then. Back then, an unemployment rate north of 5% seemed like a bad thing, something that should be avoided. Economic collapse and a sluggish recovery later, getting back down to 5% unemployment would seem like the glory days personified. Heck, anything under 6% would feel like paving the streets in gold.
Some 53 months ago marked the start of this employment recession, and it very well might be another 53 months before things return to previous lows, if they ever do.
Hiring has slowed down in recent months, leading to an even slower and more anemic pace of recovery. All things considered, the amount of new jobs created has lagged the number of new people entering workforce eligibility, so job “losses” are actually on the increase again. For the past three months the number of new jobs have failed to crack the 100,000 per month level, with a minimum of 135,000 – 150,000 needed per month needed just to keep up with population growth. The last time those sorts of positive numbers were seen were back in March.
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Antonis Samaras of the New Democracy party is the new Prime Minister of Greece after an electoral victory and successful coalition formation with two other parties.
The 17th of June came and went, and since the financial world still seems to exist, it is apparent that the Greek elections did not go as “disastrously” as possible. Actually the result, much like the one in May, wasn’t that conclusive. The difference this time was that with the threat of a Greek exit from the Euro or “Grexit” on the before-the-end-of-the-month horizon, parties that were previously known for bowing their heads to European pressures and accepting austerity terms decided that they would once again bow their heads, accept austerity terms, but also promised to try extra hard to get in a “please don’t hit me so hard” to those dictating the terms.
This little bit of wiggle room helped Greece realize a new majority coalition, as the center-right New Democracy party hooked up with the austerity-backing socialist PASOK and the relatively new slightly-left-of-left-of-center DIMAR party. On the outside looking in includes the anti-austerity Coalition of the Radical Left (SYRIZA), the right wing Independent Greeks, the Communist Party, and the neo-Nazis. The neo-Nazis occupy 18 seats (↓3) of the new parliament, or 6% of the government. Heartwarming.
Ironically the parties that wound up sitting down at the table to form this new government could have done the exact same thing last time around. Coalition partners totaled 168 of 300 seats, but this time that number was slightly bumped to 179. While that leaves a “so why’d we have to go through all that” taste in the mouth, one thing is for sure – the political leanings of those sitting across the table from European negotiators as more details of austerity continue to be hashed out are really not going to look that much different from the pols who were there before this year’s elections and all the way down to this place. The new boss same as the old boss indeed.
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Posted by jad
on 2012 June 8
Construction spending on residential properties is the lowest it has been since early 1997.
A long time ago people built houses. They built them because they needed or wanted a house. They built them with the idea of moving out of wherever they currently lived, turning over that property or rental to whomever claimed it next. People who never owned or rented before also wanted a house. They were just starting out, perhaps. Maybe they bought the house that people building a house sold, or maybe they had one of their own built. In any case, people built houses, and it was good.
Along came a scheme, a scheme to make a whole lot of money, continually, “forever”. The value of land and the value of homes did a lot more than just creep up as it had in years past. Fueled by the carefree 1990′s, the seeds of a boom began. Soon homes weren’t being built for a new place to live for the next 30 years to a lifetime, homes were being built so someone could move into a larger, more expensive home, “flipping” their old one and pocketing the reward that progressively higher values offered. The houses were flipped to more people who had no other intention than flipping on their own. Here and there people who wanted to move into a house for the legitimate home purpose got caught up in the excitement – and by excitement I mean elevated mortgage price.
Soon most of the people who wanted a home long term were priced out of the market. They weren’t interested in flipping, so they ignored the bank’s calls for lower mortgage rates and exciting opportunities oh if only they’d just call back. The people left with the progressively newer and newer homes were just the flippers – playing a progressively higher stake game of hot potato, though they didn’t know that just yet.
One day the music stopped. Nobody wanted the homes anymore. No one could afford them. The banks couldn’t afford to lend anymore. The roller coaster was pointed down. There was no one left to throw the potato to, and it all came tumbling down.
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Posted by jad
on 2012 June 7
State and local government employment has been on a steady decline since 2009.
Thankfully in the most stressful times of the 2008 financial crisis, those who were in power – on both sides of the isle – decided against a strict policy of austerity unlike our counterparts in Europe. One can only imagine how much more devastating unemployment would have been if the government decided to start the wholesale slashing of jobs in the waning months of 2008. At the time the debate was between those who wanted to bail out various segments of the private sector vs. those who were in favor of some targeted bailouts but a more broad-based government spending program to get us through this.
Kneecapped, we still know that broad-based government spending as “the stimulus”. Depending on your disposition to the facts you either figure it softened the blow somewhat, prevented a second Great Depression, or was a horrible government handout fest something something where’s his birth certificate. (Sorry, going forward I will pretend all sides arguing this are rational actors. It’s too much credit for Washington, but it will have to do.)
The effects of the stimulus began to run out in 2009 as unemployment continued to rise. Thanks to carefully AstroTurf’d public relations campaigns, the mood in the country was turning decisively against additional large injections of monies into the real economy. The Federal Reserve was still able to run off with the quantitative easing that did… something… but as for dollars for main street? That was a waste. Or socialism. Or both.
Hands were wrung in despair last week as the Bureau of Labor Statistics announced that the unemployment rate was back on the rise. The economy added a paltry 63,000 jobs and once again it seems like the recovery is stalling. Unemployment rose to 8.21% from 8.1% with 12.7 million people on the unemployment rolls – up from 12.5 million. That said, what if I told you the very same unemployment report could have read a rate of 7.84% with an extra 573,000 people not on the unemployment rolls? What if I told you that with a very careful policy of not shooting one’s foot off, it’s still obtainable?
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