A battle within a battle is the additional spice that gives flavour to any cricket series. The 7-match ODI series between India and Australia is the battlefield after India’s first round exit from the Champions Trophy. The tale of two champions, Ricky Ponting and Sachin Tendulkar, is an indirect scrap within the direct clash. Tendulkar has had an indifferent start to the series; failing in the first two games while Ponting, with a first match 74, has started well.

After India’s first round exit from the 2007 World Cup, former Australian captain Ian Chappell in his column for Mumbai-based tabloid Mid-Day wrote: “If he (Tendulkar) had found an honest mirror three years ago and asked the question; “Mirror, mirror on the wall who is the best batsman of all?” It would’ve answered; “Brian Charles Lara.”
If he asked that same mirror right now; “Mirror, mirror on the wall should I retire?” The answer would be; “Yes.”

Ian is an astute reader of the game and his brother Greg a batting legend; but like ordinary mortals they too can and have been proven wrong. The biggest mistake in the 2007 World Cup, in my view, was to push Tendulkar down the order. In 61 innings at number four Tendulkar has 4 hundreds and 15 fifties at 38.84 with a strike rate of 77.08. At the top of the order he has 40 hundreds and 70 fifties at an average of 48.08 with a strike rate of 87.56—the simplest reason for where he should bat is in front.

I’ll come to the Chappell brothers later and pick a few points in the contemporary debate. After 18 Tests, Ponting had 2 hundreds and 6 fifties at 37.25 while Tendulkar at the same juncture had 3 hundreds and 4 fifties at 38.68; not any significant disparity. The difference was in the circumstances and the manner: ‘God is in the details’, as architect Ludwig Mies said.

Tendulkar was a name doing the rounds even before his debut as the cricketing grapevine circulates in Test-playing nations. Cricket journalist Mark Ray wrote in The Sunday Age of how he lingered at the nets to see India’s ‘Boy Wonder’ bat early in the 1992 Australian tour.

The Wisden Almanack report after the Old Trafford Test in August 1990 said: “Of the six individual centuries scored in this fascinating contest, none was more outstanding than Tendulkar’s; which rescued India on the final afternoon. More significantly, after several of his colleagues had fallen to reckless strokes, Tendulkar held the England attack at bay with a display of immense maturity.” He was 17 years and 112 days old at that time.

The legend, though, was born in the fifth Test played at the Western Australia Cricket Association Ground, Perth from Feb 1-5, 1992. The conversation in the Australian dressing room among sweaty and burly hard men turned to a cherubic-faced young boy about three months shy of turning 19 and born and brought up on low and slow Indian wickets. The boy had defied a steaming four-pronged Australian pace attack for over four hours on the fastest and the bounciest pitch in the world with a mixture of grace and power that his opponents found hard to fathom in one so young.

Merv Hughes cracked open a beer and turned to his captain, Allan Border; the tough Aussie credited with rebuilding the side. “This little prick’s going to get more runs than you, AB.”* Tendulkar had announced himself with a 148 not out in Sydney—the debut match of Shane Warne—but it was not until the fifth Test at the WACA, where the ball whizzed around his ears and he scored 114 that he made a major impression. “The one in Perth, he made them in tough conditions and he looked as though he was at home,” Hughes said.

The next time Australia played in a Test match in Perth with four quicks and no specialist spinner was on January 16, 2008 in the third Test against India. The Test where India became the first team from the subcontinent to win at Perth. The boy was too young in 1992 and in 2008 doubts lingered that the man may be too old; it didn’t matter to the man and like the boy he also reached Perth having made runs in Sydney—this time a 154 not out. Tendulkar made an audacious 71 before falling to an unlucky lbw decision. He finished with 493 runs at 70.42; his best ever return from any series.

The little master’s peak years in the mid- and late-nineties, when he decimated bowling attacks all around the world have been well-documented and can be left for this specific argument. On the third of November 2002 Tendulkar had 31 hundreds and 34 fifties at an average of 58.46 in 103 Tests; he was 19 hundreds and 18 fifties clear of Ponting. It was a gap that could only have been bridged if Ponting had a few out of the world seasons and Tendulkar remained stationary. That is how it went, almost.

The incredible passage of play from the Brisbane Test in 2002 to the end of the 2nd Ashes Test in Adelaide 2006 established Ponting as a modern great; he played 48 Tests and scored 21 hundreds and 19 fifties at a phenomenal average of 73.86 in this period. Perhaps the best run for such a lengthy period in the modern era. Tendulkar, in this period, played 30 Test matches and made 4 hundreds at 43.23—an injury-marred passage in which he underwent two surgeries and made three international comebacks.

After Adelaide in 2006 Ponting has played 29 Tests and added 5 hundreds and 13 fifties at 42.97. Tendulkar after December 18, 2006 has played 26 Tests and scored 7 hundreds and 12 fifties at 52.23. In the last two seasons the little master’s graph is again climbing; in the Test matches he has played with a combination of compact technique and eclectic stroke-play.

In the limited overs Tendulkar returned to the opening slot after the 2007 World Cup. In the 46 games after that he has scored three hundreds and 14 fifties at 47.04 and a strike rate of 85.39. All three hundreds have been match-winning knocks and two of them have been in tournament finals; seven of his fifties have been scores of 90 plus. He has scored higher than his overall average since the World Cup match. There is no one in the same vicinity to even think of any comparison here.

Ian Chappell wrote in a 2005 Mid-Day column after the Ganguly-Greg Chappell controversy: “However, if you don’t want to hear the truth, then don’t ask him (Greg) for a frank opinion. Greg Chappell grew up in a household where frank opinions were served up at the breakfast table more often than cereal and fruit juice.”

Being upfront is a virtue that our cricket administration or our administration in general can benefit from and there should be no issue with the Chappell brothers on that count. An honest mirror at this stage, though, would tell Tendulkar that his wish is the only command. He has defied enough studio pundits for any mirror to be able to speculate on his future.

The Chappell brothers, though, can benefit from an honest mirror, as it may tell them frankly that prophecy is not their strong point and they should resist playing soothsayers.

*Sources — Chloe Saltau for The Age and for stats and Wisden Almanack opinions — Crininfo and Cricinfo archives

Bernanke, Geithner y Obama consideran que los activos de los bancos están artificialmente deprimidos por una disfunción de los mercados, que tiene en la falta de liquidez su síntoma principal, y que cuando esos activos salen del lugar donde los ocultan los contables y van al mercado, los inversores pagan por ellos mucho menos de lo que debería ser su justo precio. Incluso aquellas hipotecas titulizadas y facturadas en obligaciones de deuda colateralizada que han recibido una calificación triple A se venden por tan solo un 40% del pretendido valor “real”. En Abril pasado el gobierno suspendió temporalmente la regla contable “Mark-to-market“, que obliga a justipreciar los activos bancarios según el valor que alcancen en el mercado de la fecha. La idea es que cuando la economía se restablezca en todas sus constantes vitales, los activos recuperarán su valor y los bancos dejarán atrás sus números rojos. Krugman anunció no hace mucho en su columna habitual del NYT que, en su opinión, el plan no era viable, aunque últimamente transmite un mensaje más optimista. El pasado 18 de este mes, el Nobel de economía, Robert Merton y dos economistas más publicaron en el Financial Times un artículo pidiendo el regreso de la norma contable. También lo pide el Nobel Myron Scholes en una entrevista para Bloomberg. Obama tiene el precedente de Roosevelt, que también suspendió el “Mark-to-market” en 1938, en plena depresión.

http://www.ft.com/cms/s/0/7eb082d6-8b8e-11de-9f50-00144feabdc0.html

http://www.bloomberg.com/apps/news?pid=20601087&sid=arI9M7cuFWjI&

El WSJ advierte sobre una nueva fase de la crisis en la que los bancos medianos y pequeños correrían peligro de caer en la insolvencia por haber adquirido un exceso de activos colateralizados, hoy muy depreciados, durante la época de la euforia financiera. Hasta ahora, el principal problema para las entidades bancarias han sido los malos prestamos. Recuerda el autor de la nota que el miércoles pasado se produjo la décima mayor quiebra bancaria de la historia en Estados Unidos: Guaranty Financial Group Inc. tiene en sus libros aproximadamente 3.5 mil millones de dólares en ese tipo de obligaciones.

Algo sobre los 13 billones de dólares que el gobierno lleva gastado en el plan de recuperación: http://www.globalresearch.ca/index.php?context=va&aid=14759

by Mike Whitney

Ben Bernanke

Fed Chairman Ben Bernanke is a man who knows how Washington works and uses that knowledge to great effect.  His appearances on Capital Hill are always worth watching. He sits politely with his hands folded in front of him playing the bashful professor while one one preening congressman after another makes a fool out of themself. In contrast, Bernanke looks like a modest and thoughtful academic faithfully upholding the public’s trust.  But things aren’t always as they seem. The Fed chief is sticking it to the American people big-time and no one seems to have any idea of what’s really going on. Former hedge fund manager Andy Kessler sums it up in a recent Wall Street Journal article, “The Bernanke Market”. Here’s a clip:

“By buying U.S. Treasuries and mortgages to increase the monetary base by $1 trillion, Fed Chairman Ben Bernanke didn’t put money directly into the stock market but he didn’t have to. With nowhere else to go, except maybe commodities, inflows into the stock market have been on a tear. Stock and bond funds saw net inflows of close to $150 billion since January. The dollars he cranked out didn’t go into the hard economy, but instead into tradable assets. In other words, Ben Bernanke has been the market.”

What does it mean?

It means the revered professor Bernanke figured out a way to circumvent Congress and dump more than a trillion dollars into the stock market by laundering the money through the big banks and other failing financial institutions. As Kessler suggests, Bernanke knew the liquidity would pop up in the equities market, thus, building the equity position of the banks so they wouldn’t have to grovel to Congress for another TARP-like bailout. Bernanke’s actions demonstrate his contempt for the democratic process. The Fed sees itself as a government-unto-itself.

Over at Zero Hedge, Tyler Durden did the math and figured that the recent 45% surge in the S&P 500 had nothing to do with the fictional economic “recovery”, but was just more of the Fed’s hanky panky. Durden noticed that the money that’s been sluicing into stocks hasn’t (correspondingly) depleted the money markets. That’s the clue that led him to the truth about Bernanke’s 6 month stock rally.

Zero Hedge: “Most interesting is the correlation between Money Market totals and the listed stock value since the March lows: a $2.7 trillion move in equities was accompanied by a less than $400 billion reduction in Money Market accounts!

Where, may we ask, did the balance of $2.3 trillion in purchasing power come from? Why the Federal Reserve of course, which directly and indirectly subsidized U.S. banks (and foreign ones through liquidity swaps) for roughly that amount. Apparently these banks promptly went on a buying spree to raise the all important equity market, so that the U.S. consumer who net equity was almost negative on March 31, could have some semblance of confidence back and would go ahead and max out his credit card. Alas, as one can see in the money multiplier and velocity of money metrics, U.S. consumers couldn’t care less about leveraging themselves any more.”

So, the magical “Green Shoots” stock market rally was fueled by a mere $400 billion from the money markets. The rest ($2.3 trillion) was main-lined into the market via  Bernanke’s quantitative easing (QE) program, of which Krugman and others speak so highly.

Wouldn’t you like to know if Bernanke sat down with G-Sax and JPM executives and mapped out the details of this swindle before the printing presses ever started rolling?

So, how long can this kind of fakery go on before our creditors grow weary of dealing with chiselers and stop buying US Treasuries altogether? Here’s a blurp from Friday’s Wall Street Journal on that very topic:

“Shaky auctions of Treasury notes this week reignited concerns about whether the government can attract buyers from China and elsewhere to soak up trillions in new debt.

A fuse was lit this week when traders noted China’s apparent absence from direct participation in two Treasury bond auctions. While China may have bought Treasurys just before the auctions, market participants read the country’s actions as a worrying sign that China and other foreign investors may be ratcheting back purchases at a time when the U.S. is seeking to fund a $1.8 trillion budget deficit.

This week alone, the U.S. deluged the bond market with more than $200 billion in record-size sales. The U.S. has had little trouble finding buyers in recent months. But that demand is fading, and the Treasury market has become volatile.”

Uncle Sam is goosing the bond market just like he is the stock market. Take a look at Treasury’s latest bit of chicanery which was stuffed in the back pages of the Wall Street Journal back in June:

“The sudden increase in demand by foreign buyers for Treasurys, hailed as proof that the world’s central banks are still willing to help absorb the avalanche of supply, mightn’t be all that it seems.

When the government sells bonds, traders typically look at a group of buyers called indirect bidders, which includes foreign central banks, to divine overseas demand for U.S. debt. That demand has been rising recently, giving comfort to investors that foreign buyers will continue to finance the U.S.’s budget deficit.

But in a little-noticed switch on June 1, the Treasury changed the way it accounts for indirect bids, putting more buyers under that umbrella and boosting the portion of recent Treasury sales that the market perceived were being bought by foreigners.” (“Is foreign Demand as Solid as it Looks, Min zeng)

Nice touch, eh? So, someone doesn’t want you and me to know when foreign demand drops off a cliff, so they just bend-and-twist the definitions so they meet the Fed’s requirements.  How’s that for transparency?. Apparently, Bernanke et al. don’t believe the Chinese have translators who can make sense of all this subterfuge. That may be a miscalculation, however, given recent rumblings from the Orient.

	The Fed’s job is to provide an endless stream of cheap capital to Wall Street. By that standard, Bernanke has performed his task admirably.

A careful reading of Federal Reserve chairman Ben Bernanke’s op-ed in Tuesday’s Wall Street Journal, shows that Bernanke thinks the economy is in a deflationary spiral that will last for some time. Ben Bernanke: “The depth and breadth of the global recession has required a highly accommodative monetary policy. Since the onset of the financial crisis nearly two years ago, the Federal Reserve has reduced the interest-rate target for overnight lending between banks (the federal-funds rate) nearly to zero. We have also greatly expanded the size of the Fed’s balance sheet through purchases of longer-term securities and through targeted lending programs aimed at restarting the flow of credit….My colleagues and I believe that accommodative policies will likely be warranted for an extended period.” No talk of recovery here; just a continuation of the same radical policies that were adopted after the collapse of Lehman Bros. The only sign of improvement has been in the stock market, where Bernanke’s liquidity injections have jolted equities back to life. The S&P 500 is up 40% since March. Conditions in the broader economy have continued to deteriorate as unemployment rises, the states find it harder to balance their budgets, and the real estate bubble (commercial and residential) continues to unwind. The Fed’s policies are Bernanke’s way of saying, “The states are not the country. The banks are the country.” The public seems slow to grasp this message.

Bernanke’s op-ed is a public relations ploy intended to soften the effects of his visit to Capital Hill today. Congress wants to know the Fed chief’s “exit strategy” for soaking up all the money he’s created and avoiding inflation. Bernanke again: “The exit strategy is closely tied to the management of the Federal Reserve balance sheet. When the Fed makes loans or acquires securities, the funds enter the banking system and ultimately appear in the reserve accounts held at the Fed by banks and other depository institutions. These reserve balances now total about $800 billion, much more than normal. And given the current economic conditions, banks have generally held their reserves as balances at the Fed.” This is the core issue. The Fed has built up bank reserves by accepting (mainly) mortgage-backed garbage (MBS) that is worth only pennies on the dollar. Bernanke assumes that investors will eventually recognize their mistake and begin to purchase these toxic assets at a price that won’t bankrupt the banking system. It’s a complete hoax and everyone knows it. In essence, Bernanke is saying that he is right and the market is wrong, which is why he continues to conceal the fact that he provided full-value loans for collateral which the banks will never be able to repay. The costs, of course, will eventually be shifted onto the taxpayer.

• A d v e r t i s e m e n t
• 

Bernanke knows that the country is in a Depression and that inflation won’t be a problem for years to come. It’s all politics. Bank lending is way off and the shadow banking system–which provided over 40% of consumer credit via securitization–is still on life-support. At the same time, the savings rate has spiked to 6.9%–a 15 year high–as consumers cut back on spending to service their debt-load, and try to make up for the $14 trillion in lost household wealth since the crisis began. If the banks aren’t lending and consumers aren’t spending, inflation is impossible.

Bernanke’s zero-percent interest rates and lending facilities have been a total bust. The velocity of money (how fast money changes hands) has stopped. Retail is down 9% year-over-year. Imports/exports down 20%. Rail freight and shipping at historic lows. Travel, manufacturing, hotels, restaurants are all in the tank. The economy is flat-lining. Only Goldman and JPM have done well in this environment, and that’s because the White House is a Goldman-annex. The only Bernanke policy that’s worked so far has been flooding the market with money, which has has sent equities into orbit while the real economy continues to twist in the wind. Here’s how former hedge fund manager Andy Kessler summed it up last week in the Wall Street Journal: “By buying U.S. Treasuries and mortgages to increase the monetary base by $1 trillion, Fed Chairman Ben Bernanke didn’t put money directly into the stock market but he didn’t have to. With nowhere else to go, except maybe commodities, inflows into the stock market have been on a tear. Stock and bond funds saw net inflows of close to $150 billion since January. The dollars he cranked out didn’t go into the hard economy, but instead into tradable assets. In other words, Ben Bernanke has been the market.” (Andy Kessler, “The Bernanke Market” Wall Street Journal) Bernanke’s quantitative easing (QE) has pumped up bank stocks enough so that Geithner won’t have to grovel to Congress for another TARP bailout. The banks now have access to the capital markets and can withstand the stormy downgrades ahead. Thus, the nagging problem of toxic assets has been solved (temporarily) just as Bernanke had planned. Bernanke will continue to monetize the debt (by purchasing more US Treasuries and MBS) until securitization is restored and there are signs of life in the failed wholesale credit-system. That’s the real objective; to keep credit expansion in the hands of privately-owned financial institutions that are beyond the reach of government regulation. The Fed’s so-called mandate of “full employment and price stability” is pure malarkey. The Fed’s job is to provide an endless stream of cheap capital to Wall Street. By that standard, Bernanke has performed his task admirably.

URL to article: http://www.infowars.com/wall-streets-love-affair-with-ben-bernanke/

There should be a modest uptick in GDP in either in the 4th quarter 2009 or the 1st quarter 2010. This will mark the end of the current 20 month-long recession, but not the end of the crisis. The blip in growth doesn’t mean that the troubles are over or that the economy is on the way to recovery. It simply means that Obama’s $787 billion fiscal stimulus is beginning to kick in, giving a boost to consumer spending and generating short-term economic activity. Regrettably, when the stimulus runs out, the economy will slide back into negative territory. That’s because the US consumer has crossed an important threshold and no longer has the ability to drive the economy through debt-fueled consumption. The data indicates a critical change in consumer behavior which portends a shift away from the current model for economic growth. It’s a whole new ballgame.

	The economy is headed for a protracted slowdown with persistent high unemployment and growing social unrest.

From the mid-1980s to 2007, the ratio of debt-to-GDP rocketed from 165% to to over 350%; more than doubling in that same period. The build-up of personal debt follows the exact same trend-line as the aggregate profits of the financial sector; they’re opposite sides of the same coin. Financial institutions increase profitability by expanding credit and inflating asset bubbles, not by allocating capital to productive enterprises. Their business model is inherently flawed. Speculative bubblemaking is Wall Street’s method of shifting wealth from workers to the investor class. It never fails. It’s the reason why 42 states are now facing budget shortfalls, unemployment has risen to 9.5 percent, and $45 trillion has vanished from global equity markets. Financialization has created a global crisis, crushed consumer demand, increased systemic instability, and put the economy into a nosedive.

In the last decade, the shifting of wealth from one class to another has greatly accelerated due to deregulation and the Fed’s low interest rates. Stagnant wages have forced reluctant participants into the market seeking a better return on their savings, while lax lending standards and easy credit have seduced workers into increasing their personal debt-load. All of this has been done by design to ensure the profits for the few over the well-being of the many.

Wall Street has conjured up myriad complex debt-instruments (derivatives and securitization) which have been used to enhance leverage by many trillions of dollars so that financial mandarins and hedge fund managers can skim lavish bonuses and salaries on the front end before the Ponzi scam implodes. In the present crisis, the situation came to a head when two Bear Stearns hedge funds defaulted in July 2007, creating pandemonium in the stock markets while credit markets froze over. As housing prices fell and unemployment rose, households were left with little choice but to slash spending to pay-down debts. The sharp downturn has dramatically changed consumer behavior and lifted the savings rate to 6.9% in the last month, a 15-year high. Savings are expected to continue to increase despite the Fed’s attempts to restart the economy with zero-percent interest rates. A recent “Economic Letter: US Household Deleveraging and Future Consumption Growth” by the Federal Reserve Bank of San Francisco outlines the conditions which have triggered this dramatic change in consumer behavior. Here’s an extended excerpt:

“U.S. household leverage, as measured by the ratio of debt to personal disposable income, increased modestly from 55% in 1960 to 65% by the mid-1980s. Then, over the next two decades, leverage proceeded to more than double, reaching an all-time high of 133% in 2007. That dramatic rise in debt was accompanied by a steady decline in the personal saving rate. The combination of higher debt and lower saving enabled personal consumption expenditures to grow faster than disposable income, providing a significant boost to U.S. economic growth over the period.

In the long-run, however, consumption cannot grow faster than income because there is an upper limit to how much debt households can service, based on their incomes. For many U.S. households, current debt levels appear too high, as evidenced by the sharp rise in delinquencies and foreclosures in recent years. To achieve a sustainable level of debt relative to income, households may need to undergo a prolonged period of deleveraging, whereby debt is reduced and saving is increased.

Beginning in 2000, however, the pace of debt accumulation accelerated dramatically…Rising debt levels were accompanied by rising wealth. An influx of new and often speculative homebuyers with access to easy credit helped bid up prices to unprecedented levels relative to fundamentals, as measured by rents or disposable income. Equity extracted from rapidly appreciating home values provided hundreds of billions of dollars per year in spendable cash for households that was used to pay for a variety of goods and services….Rapid debt growth allowed consumption to grow faster than income.

Since the start of the U.S. recession in December 2007, household leverage has declined. It currently stands at about 130% of disposable income. How much further will the deleveraging process go?

Going forward, it seems probable that many U.S. households will reduce their debt. If accomplished through increased saving, the deleveraging process could result in a substantial and prolonged slowdown in consumer spending relative to pre-recession growth rates. (”U.S. Household Deleveraging and Future Consumption Growth, by Reuven Glick and Kevin J. Lansing, FRBSF Economic Letter”)

Household wealth has dipped $14 trillion since the crisis began. Wages are slowly retreating and unemployment is at 9.5% a 25 year high. Also, the percentage of home equity has fallen below 50% for the first time on record. And—since one-third of homes have no mortgages (100% ownership)–the remaining homes have only 12% equity. If prices continue to drop in 2010, the vast majority of homeowners will be underwater presaging a sharp rise in the number of foreclosures.

In the last 18 months, the ratio of debt to disposable income has only eased to 128%, which means that it will take at least a decade to rebuild balance sheets enough to resume spending at pre-crisis levels. It’s going to be a long hard slog even if the stimulus works according to plan, especially since unemployment is headed for 10% by the end of September and higher by 2010. Household deleveraging will continue regardless of positive developments in the markets, which means that the economy will reset at a lower level of activity. This precludes any chance of a strong recovery. According to David Rosenberg, chief economist for Gluskin Sheff :

“By our estimates, there is up to another $5 trillion of household debt that has to be eliminated in coming years and that process is going to require that consumers go on a semi-permanent spending diet. Companies see this, which is why they are not just downsizing their payroll, but have also cut the workweek to a record low of 33.1 hours. Fewer people are working and those that are still working have seen their hours dramatically cut this cycle….

The op-ed column by Bob Herbert in the Saturday New York Times really hit the nail on the head on this whole ‘green shoot’ issue — how can there be ‘green shoots’ when the labour market is deteriorating at such a rapid clip fully nine months after the Lehman collapse. The full brunt of the credit collapse may be behind us, but please, the other two shocks, namely deflating labour markets and deflating home prices, are very much still front and centre. For every job opening in the USA, there are more than five unemployed actively seeking work vying for those jobs. That is unprecedented and nearly double what we saw at the depths of the 2001 recession. The official ranks of the unemployed have doubled during this recession to 14 million and if you take into account all forms of labour market slack, the unofficial number is bordering on 30 million, another record. For those who still believe that we somehow managed to avoid an economic depression this cycle because of a 13% fiscal deficit/GDP and a pregnant Fed balance sheet, the Center for Labour Market Studies at Northeastern University estimates that the real unemployment now stands at 18.2%, which is actually higher than the posted rate at the end of the 1930…

What makes this cycle “different” is that three-quarters of the workers that were fired over the last year were let go on a permanent, not a temporary basis. A record 53% of the unemployed today are workers who were displaced permanently — not just temporarily because of the vagaries of the traditional business cycle. This means that these jobs are not going to be coming back that quickly, if at all, when the economy does in fact begin to make the transition to the next expansion phase.” (David Rosenberg chief economist Gluskin Sheff)

Rosenberg’s comments should be carefully considered in relation to the scaremongering about inflation by conservatives and alarmists in the media. Inflation is not serious danger for the foreseeable future. The velocity of money has collapsed and deflation is pushing down asset prices and wages. Every sector is contracting. Without stimulus, the economy will remain in negative GDP. Here’s Scott Patterson from the Wall Street Journal:

“A rule of thumb is that inflation doesn’t become sticky until the unemployment rate dips below 5%. Since 2001, the Nonaccelerating Inflation Rate of Unemployment, or NAIRU, the rate at which economists estimate the labor market can trigger inflation, has stood at 4.8% unemployment, according to the Congressional Budget Office.

In the first quarter, the spread between the NAIRU and the actual unemployment rate averaged 3.3 percentage points, the widest spread since 1983, when unemployment hovered around 10%. A high spread suggests the labor market needs to get stronger before inflation is a concern.” (”Inflation fears? Not in this job market”, Scott Patterson, The Wall Street Journal)

• A d v e r t i s e m e n t
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The inflation hobgoblin is a political ploy by the Republicans to derail Obama’s recovery plan. And, in some respects, it’s working. Public support for a second stimulus package has withered, and with it, any hope for sustained rebound. Pressure on wages and prices are growing while the effects of deflation are becoming more and more apparent. Delinquencies, defaults, bankruptcies and foreclosures are all up, while state budgets buckle and joblessness mushrooms. The Republicans are following the neoliberal handbook, trying to crash the economy so that public assets can be privatized and public services terminated They’re being helped in their campaign by bailout-weary citizens who don’t understand that short-circuiting government spending during a deep recession can precipitate a bigger catastrophe.

That said, liberal economists have made poor case for more stimulus. Stimulus is not a panacea; it’s merely a bridge from Point A to Point B. Government spending can take up the slack in demand, but it can’t fix the economy’s underlying problems. That takes policymakers who are willing to do-battle with the big banks and re-regulate the financial system. No one in the Obama administration is willing to perform that task, so the economy will continue its downward drift.

Presently, the banks have more than a $1 trillion in toxic assets on their balance sheets and the wholesale credit markets (securitization) are in a shambles. Nothing has been done to separate commercial from investment banks, force all derivatives onto regulated platforms, unwind insolvent financial institutions, establish prices for complex securities, increase capital requirements, or put an end to off-balance sheet operations.

If the underlying problems are not going to be fixed, than why are liberal economists so eager to use their talents to minimize the effects of the recession? They’re just making it easier for Wall Street huckster’s to start gaming the system again. The job of progressive economists is to promote a more equitable system that reduces inequality and provides for the basic material needs of all its citizens. There’s no sense in cheering on stimulus if it just perpetuates the same dog-eat-dog system.

The subtext of the financial crisis is class warfare, a fact that mainstream economists would rather ignore than invoke the musty imagery of disheveled revolutionaries and Soviet-era repression. Nevertheless, during the Bush years, the chasm between rich and poor widened to levels not seen since the Gilded Age. Now the top 1 percent of wealth holders own more than twice as much as the bottom 80% of the population. All of the real gains in national income, total net-worth, and overall growth in financial worth have gone to the same 1 percent.

But the strides in personal enrichment have come at great cost. The US consumer, long considered an inexhaustible resource, is tapped out. Without job security and access to easy credit; consumer spending will slow, prices will fall, demand will flag and the economy will tank. There won’t be a recovery, because pre-crisis levels of consumption will not return; that much is certain. Sustainable growth requires higher wages and longer working hours; neither of which are likely anytime soon. The economy is headed for a protracted slowdown with persistent high unemployment and growing social unrest. The future is deflation.

URL to article: http://www.infowars.com/the-future-is-deflation/

AP PHOTO: Bill Perry, left, a disabled American veteran from Levittown, Pa. , kisses Nguyen Thi Hong, from Bien Hoa, Vietnam, as she is pushed in a wheelchair followed by Nguyen Van Quy, right, from Thai Binh, Vietnam, also wheelchair bound, as they arrive in New York, Monday June 18, 2007. Nguyen Thi Hong and Nguyen Van Quy are Vietnamese victims of Agent Orange, a spraying chemical used during the Vietnam war. Vietnamese victims of Agent Orange received little encouragement from a federal appeals panel when they sought to reinstate their claim that U.S. companies committed war crimes by making the toxic chemical defoliant available for use in the Vietnam War.

“People need to see what war really is, not the Hollywood version”

by Mike Whitney

Charlie Ehlen is a former Marine now living in Glenmora, Louisiana

Originally, Memorial Day was created to honor Union troops who had died during the “Civil War” but, eventually it was expanded to include all American troops killed in action. At first, it was called Decoration Day and was the traditional day for the running of the Indianapolis 500. Monday through Friday was Race Day. Now, we’ve changed all that so we get a long weekend and businesses can have special holiday sales and make a quick buck. Ain’t America great?

I just finished an article about “Rolling Thunder”, a patriotic group of ex-vets who ride their motorcycles to Washington DC every year to honor the men who died in Vietnam. The article tells how the group “lost their way” in recent years and turned into a pro-war group. The article repeats the myth that vets were spit when they got back from Nam. This is total CRAP! As a veteran of the Marine Corps and Vietnam, I never had any such experience, nor did ANY veteran I’ve ever talked to. It’s a lie, plain and simple.

Another myth is that all Vietnam vets are drugged out criminals who lost all sense of morality.

That’s just more BS. We were not all criminals.

The same crap is being spread about Arabic people today. Why? Because, like the “deranged Vietnam vet” of the 70’s they’re an easy target to blame and abuse. It’s just another way of reinforcing stereotypes and building support for the war.

We don’t see that every person we kill in a foreign country creates more radicals who hate us. It’s like Vietnam all over again, only worse. America is just too bloody stupid to figure it out. We ever learn from our mistakes.

People need to see what war really is, not the Hollywood version. They need to know what it smells like on a battlefield, although that’s impossible to transmit through TV or the movies

Having survived a tour in Vietnam, I’d like for all of these armchair generals and cheerleaders to see what war is really like– the sights, the sounds, and the smells. That would cure them fast!

War is the most pornographic thing humans have ever devised. Trust me on this. Unless you’ve been in a war, you’ll never, really understand what it’s like. It’s beyond your wildest dreams….or nightmares. It’s just something you have to experience yourself. Then you’ll hate it much as I do.

On this Memorial Day holiday, we need to remember not just the troops who have died in our wars, past and present, but all the people who’ve been killed or maimed from war.

semper fi charlie ehlen

_______

Mike Whitney

Source: http://www.smirkingchimp.com

Depressionus Interruptus: Did Bernanke pull the economy back from the brink?

By Mike Whitney

The stock market surge doesn’t help working people who get paid by the hour and don’t have the extra money to bet on equities. They can’t move numbers from one ledger to another and magically show a profit. They have to balance their check books, show up on time, and play by the rules. For these people – the bulk of working Americans – the future has never been grimmer and less certain.

The Patriotic Retirement Plan: “How Would You Fix the Economy?”

By St. Petersburg Times

The St. Petersburg Times Newspaper, Business Section asked readers for ideas on “How Would You Fix the Economy?” This guy nailed it!

So, I’ve been here almost a week.  I love Korea.

Question: What do you get when you have 12 attractive Korean men, standing on a stone balcony, yelling what appear to be insults and degrading requests to two equally as attractive men, in a dusty soccer field, standing in front of a tent?

Answer: Prime time Korean Television

I know I have written before about these particular kind of Koreans who are famous for being famous. Literally, they have no talent except looking attractive, and doing stupid things on Television. Think Mike Whitney (in his hey day) and Tanya Zaetta. But times 1000 and on TV 24/7.

This particular program ended with the two boys in the field being made to hug and pretend to make out in the tent, and then run around tagging each other.

I’ve been in Daejeon since Monday, and will be here till Friday.  Nathan is doing a job whereby he travels to different towns in Korea, and does pretty much a live version of Playschool for small Korean Children. It’s very cute.  So this week I followed him.

I start my first ‘appointment’ next week. I am going to refrain from calling it a job, because… Well, let’s just hope that govornment officials do not stalk dancer’s blogs.

I’ve had a pretty relaxing week. Have spent a bit of time writing and compiling our Australia Council grant, trying to organise my life, and trying not to think about the fact that I have to work with ‘real’ dancers next week.

Nathan and I went back to a bar that I had already been to on tour.  I’ve probably written about it here, because we celebrated Younghee’s Birthday there.  Bar ‘Ethnic’. Or ‘Ethnic Flower’, depending on what sign you read. Actually, the Korean name on the entrance just says ‘꽃’ (flower).  Giema and/or Polly would love the Ethnic Flower.

Last time we were almost kicked out because Jeonghaeng kept spilling drinks, and other crew members kept burning things in the copious candles.  It is actually an ideal venue, and Nathan and I think we may end up owning one very similar.

Discreet stone street entrance (this month covered in a fake hedge and blue led flower wall, but looked better just raw stone), leading to a concrete bunker-like staircase, taking you several flights underground.  When you enter the room, you are met with several attractive staff, and a long, rectangular pool, complete with misty fog, an overhanging tree and literally hundreds of candles and lanterns all around the space.  The walls and floor are varnished concrete, and covered in cushions, mats and little low tables.  Your shoes go in a satin bag that you carry with you, and right at the end of the room, overlooking the pool up on a dais, behind sheer chiffon curtain is a private table where you can have your tarot read.

They have good cocktails, nice music, and a very worm and friendly vibe. Will totes go back next time I’m in Daejeon.

This comes from my friend, Tad…. A worthy set of quotes to consider, in light of where we are economically and how so many people have been duped by so few:

“The study of money, above all other fields in economics, is one in which complexity is used to disguise truth or to evade truth, not to reveal it.” John Kenneth Galbraith

“It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.” – Henry Ford

“History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control over governments by controlling the money and its issuance.”
- James Madison

“Give me control of a nation’s money and I care not who makes her laws.”
- Mayer Amschel Rothschild, Europe’s first internationalist central banker. His descendants control The Fed and the Bank of England today.

“When the President signs this act [Federal Reserve Act of 1913], the invisible government by the money power ~ proven to exist by the Monetary Trust Investigation ~ will be legalized. The new law will create inflation whenever the trusts want inflation. From now on, depressions will be scientifically created.”  -Charles A. Lindbergh, Sr., Congressman (R-MN), father of famous aviator.

“We have what is known as the Federal Reserve Bank System. That system is not owned by the Government. Many people think that it is because it says “Federal Reserve.” It belongs to private banks, private corporations. So we have farmed out to the Federal Reserve Banking System that which is owned exclusively, wholly, one hundred percent to the private banks. We have farmed out to them the privilege of issuing the Government’s money!” – Wright Patman [John William Wright Patman] (TX-D) – Source: Congressional Record (29 Sep. 1941)

“No State shall… coin money; emit bills of credit; make any thing but gold and silver coin a tender in payment of debts….”
- United States Constitution, Article 1, Section 10, Clause 1

“The bank hath benefit of interest on all moneys which it creates out of nothing.” -William Paterson, founder of the Bank of England in 1694, the UK’s privately owned central bank.

The following statements were made during hearings of the House Committee on Banking and Currency, September 30, 1941.  Governor Marriner Eccles was Chairman of the Federal Reserve Board at the time of these hearings:

Congressman Patman: “How did you get the money to buy those two billion dollars worth of Government securities in 1933?”

— Governor Eccles: “Out of the right to issue credit money.”

— Patman: “And there is nothing behind it, is there, except our Government’s credit ?”

— Eccles: “That is what our money system is. If there were no debts in our money system, there wouldn’t be any money.”

— Congressman Fletcher: “Chairman Eccles, when do you think there is a possibility of returning to a free and open market, instead of this pegged and artificially controlled financial market we now have?”

— Governor Eccles: “Never, not in your lifetime or mine.”
More General Quotes:

“Some people think the Federal Reserve Banks are US government institutions. They are not… they are private credit monopolies which prey upon the people of the US for the benefit of themselves and their foreign and domestic swindlers, and rich and predatory money lenders. The sack of the United States by the Fed is the greatest crime in history. Every effort has been made by the Fed to conceal its powers, but the truth is the Fed has usurped the government. It controls everything here and it controls all our foreign relations. It makes and breaks governments at will.” – Louis McFadden (1876-1936) US Congressman (R-PA) (1915-1935), Chairman of House Banking and Currency Committee. McFadden was shot at twice, then poisoned in 1936.

In regard to the current financial collapse surrounding subprime lending:  “The Fed refused to perform its oversight duties because its friends in the banking industry were raking in obscene profits selling sketchy, subprime junk to gullible investors around the world. They knew about the “massive off balance-sheet positions” which allowed the banks’ to create mortgage-backed securities and CDOs without sufficient capital reserves. They knew it all; every last bit of it, which simply proves that the Federal Reserve is an organization which serves the exclusive interests of the banking establishment and their corporate brethren in the financial industry. Surprised?” – Mike Whitney: It’s Time to Dump the Federal Reserve

Our founding Fathers knew of this threat:

“I place economy among the first and most important republican virtues, and public debt as the greatest of the dangers to be feared. To preserve our independence, we must not let our rulers load us with perpetual debt.” – Thomas Jefferson

“If the American people ever allow private banks to control the issue of their money, first by inflation and then by deflation, the banks and corporations that will grow up around them (around the banks), will deprive the people of their property until their children will wake up homeless on the continent their fathers conquered.” – Thomas Jefferson

“If we run into such debts as that we must be taxed in our meat and in our drink, in our necessaries and our comforts, in our labors and our amusements, for our callings and our creeds, as the people of England are, our people, like them, must come to labor sixteen hours in the twenty-four, and give the earnings of fifteen of these to the government for their debts and daily expenses; And the sixteen being insufficient to afford us bread, we must live, as they do now, on oatmeal and potatoes, have no time to think, no means of calling the mismanagers to account; But be glad to obtain subsistence by hiring ourselves to rivet their chains around the necks of our fellow sufferers; And this is the tendency of all human governments. A departure from principle in one instance becomes a precedent for a second, that second for a third, and so on ’til the bulk of society is reduced to mere automatons of misery, to have no sensibilities left but for sinning and suffering…and the forehorse of this frightful team is public debt. Taxation follows that, and in its train wretchedness and oppression.” – Thomas Jefferson

One last quote, again for contextual understanding. I don’t know when it was written or spoken: “Historically, the United States has been a hard money country. Only since 1913 has the United States operated on a fiat money system. During this period, paper money has depreciated over 87%. During the preceding 140 year period, the hard currency of the United States had actually maintained its value. Wholesale prices in 1913… were the same as in 1787.” – Kenneth Gerbino former chairman of the American Economic Council

“Unrestrained capitalism is a form of societal self-mutilation.” John L. Mann

” What is not being said ? What does Bernanke see that he would take the inflationary risk of expanding the Federal Reserve by another 1.2 Trillion ? What is Bernanke not telling us ?

Quite possibly, it’s the fact that the Bank of International Settlements reports a grand total of $57.3 trillion in credit default swaps, more than 28 times larger than AIG’s CDS portfolio !

–

The incompetent Clinton and Dubya administrations, unregulated banksters and Wall St criminals, greedy CEOs, and a no-think economics profession have destroyed America’s economy…….. writes Paul Craig Roberts in this article here.

When globalization was the buzz word, many of us viewed it with some amount of skepticism, while some  poked fun at us saying that it is bound to happen. Integrating yourself with the rest of the world is bound to happen, they said and I would say, our friends who took pleasure in poking fun at us never thought of the extent of this integration. Some of these fun pokers might be quite flummoxed now, seeing the after effects of the present global economic downturn.

So what did this hallowed “opening up” give us? Yes, it did gives an opportunity to take a dig at those “license raj” times our fathers and forefathers lived through. Instead of Nutramul, many of our peers started drinking Nestle products, instead of Goldspot and Limca we got glitzy Coke and Pepsi to quench our thirsts. For a while, let us forget that these companies bought over these products which were available in India, shunned it from the market for a while and brought them back with bang in to the midst of us. The integration did not stop there, we were awarded a slew of Miss World’s and Miss Universe’s and now ,adverts of  cosmetic products have even found a place on our railway tickets . After all railway traveling junta really needs a clean up than the ones who zip through the sky. The list goes on and on and it was party time for the fun pokers and they really did pull up their sleeves and carried out the job with aplomb. The skeptics quivered!

The “opening up” has indeed brought about changes and many who were privileged enough did make most out of it; where as, a whole lot was left behind. But it has really taken us to a point where, some people orchestrate a massive bungle and we are at the receiving end of it. If you have not understood anything about the current financial melt down, then hear this. Some unregulated bankers, Wall Street criminals, fraudsters planned a massive rip off and they are no cheap criminals. These criminals are those who hold great abbreviations like CEO against their names bungled a whole lot off money by securitising a lot of loans and mortgages and started skimming profits from the top. They were given billions of Dollars as bonuses for skimming these profits. Everyone seemed to be happy as long as the securitisation bubble lasted, it propelled the speculation sky high.  At the height of speculation the oil prices shot up, inflation touched their maximum limits and we poor fellas grabbed books about peak oil and contemplated over it. Behind our backs CEO’s and directors who earned billions of dollars orchestrated a massive rip off and i slept off reading about an oil devoid world.

Fun pokers still poked fun – the markets are bound correct and re-adjust themselves. Yeah, you got it right. They will ,but how? It seems this speculative credit will contract up to 30 or 40 %, and will push us to a “great” depression. I dont really want to think of all these doom and gloom and rightfully i will also be tormented if such a situation arises. But who are responsible for this? Why is not anyone pointing fingers towards anyone who orchestrated this rip off? A few thousand people orchestrated this bungle and if they are allowed to sneak out without a punishment, wont they perform this over and over again?

This time around there is a right “Bakra” up there and it is Barak Obama and how true is Mike Whitney when he writes :

That means that credit will probably contract by 30 to 40 percent putting us on the path to another Great Depression. Unless the government takes preventative action to get money into the hands of consumers and restore confidence, the nation will face (what David Brooks called) “grueling scarcity” and widespread panic. That’s probably why all the voting machines and exit polls finally matched up with the election results in the 2008 presidential balloting for the first time in 8 years; because the ruling elites know that they need a popular executive to put in front of the cameras when they try to calm the crowds and keep the country from disintegrating into anarchy. It also explains the nervous smiles on the faces of the money-lenders and graybeards assembled on the stage behind Obama at his first press conference. The American establishment is placing all its hopes for economic survival on the narrow shoulders of their newest posterboy, Barack Hussein Obama.

Integration, one world and global village are nice concepts, if things are fair and square but unfortunately they are not and that is where it goes completely wrong. We all living at another end of this round globe called earth are now equally vulnerable as the hapless middle class Americans who are at the end of this organized rip-off staged by some crooks. The weirdest part of this whole commotion is that nobody seems to be guilty and no one is convicted for organizing such a rip off. The mess created by some handful of wealthy morons eventually is apportioned as the problem of the government and the tax paying people. As long as they go unpunished, these wealthy morons will go on ripping us off from our jobs, easy credit and what not.

7 lakhs workers who are involved in the textiles and garment industry have lost their jobs. Aviation and other sectors are planning for more job cuts, IT and related services have stopped further hiring ,says our NASSCOM, it is just a way of masquerading the reality with soothing words to avoid panic. Many of the fun pokers have had a good enough ride along the crest of this almost illusionary growth bubble . Now it all seems to be getting back to where it was, just that we have more credit card holders, more number of mobile phones and some glitzy gadgetry. Some have not yet stopped poking fun, while they belt out their theories of how guarded our banks are against the global credit crunch and so on.

The fun poking community is surely flummoxed this time around.

This is a clutch article from Mike Whitney at Counterpunch:

“The Bush administration has called for an economic summit to be held by the 20 largest economies sometime after the presidential elections. US and EU officials are hoping to stitch together another Bretton Woods wherein control of the global economic system was delivered to those same nations. It’s likely, however, that the outcome will turn out considerably different than anticipated. Already, under China’s leadership, 12 Asian nations have agreed to set up an 80-billion-dollar fund to protect their economies from currency-runs, capital flight or other financial disruptions. China has the world’s largest reserves at $1.9 trillion followed by Japan at more than $1 trillion. Clearly the two richest nations will set the agenda and play a central role in deciding how best to deal with the global recession.

The November summit in Washington could produce some unwelcome surprises which were hinted at by Thailand’s Deputy Prime Minister, Olarn Chaipravat, who told Bloomberg News:

“The message of this initiative is for China to consider whether or not China would open up its banking system and allow the strongest currency in the world, which is the Chinese yuan, to be the rightful and anointed convertible currency of the world.”

Yesterday, Congress rejected the $700 billion Wall Street bailout proposal, and I for one am thankful that the politicians are actually showing some will power and acting in the interests of the people instead of the Wall Street people. Dennis Kucinich once again brought that heat and put it down for  working and middle class Americans in his speech on the House floor.

The Bushies are proposing using $700 billion in taxpayer money to bailout the Wall Street CEOs who got us into this mess in the first place, effectively letting them off the hook with zero accountability for their terrible decisions and putting the burden on us, the people. Instead of talking about using tax payer dollars to bailout Wall Street as if that is the only option, why don’t we use that money to bailout the taxpayers themselves, by helping them pay off their mortgages?

I thought Mike Whitney’s analysis of the situation on CounterPunch was pretty dope and insightful. He states:

“The reason the system is exploding is because the various financial institutions have been allowed–via deregulation–to act as banks and create as much credit as they choose without a sufficient capital base. When one reads about massive deleveraging, this relates directly to the fact that under-capitalized businesses were operating with too much debt in relationship to their capital. That’s it in a nutshell; forget about the CDOs, the MBSs, the CDS and the whole alphabet soup of derivatives garbage. They were all inserted into the system so Wall Street landsharks could expand credit without supervision and balance trillions of dollars of debt on the back of a one dollar bill. This is why Paulson wants to suspend the rules which would bring credibility and trust back to the system. After all, that might impinge on Wall Street’s ability to enrich itself at the public’s expense.”

It is actually a block of very fired up Republican legislators, as well as progressive Dems like Kucinich and Oakland’s Barbara Lee, who pushed to defeat the bill. What’s even crazier to me is the fact that when I read all the analysis of the situation, I’ve been finding myself feeling the comments made by Republican legislators who voted in opposition to the plan way more than the lame ass Democrats like Nancy Pelosi who are calling for the parties to unite in passing it. For example, Darryl Issa, R-Riverside County, states that “This is a manufactured crisis…the administration already has the tools it needs to inject banks with capital, [which would be] every bit as effective as the bailout.”

We’re in for some crazy times, ya’ll. Brace yourselves.