Thursday, January 31, 2013

Thursday roundup (01-13-13)


[Global] Water Demand for Energy to Double by 2035 (National Geographic)

Cyprus Presents Systemic Threat to Euro Area, Merkel Ally Says (Bloomberg)

France could join list of eurozone casualties in a fresh crisis: New figures lay bare growing disparity with Germany as jobless rate hits 15-year high and consumer spending stagnant (The Guardian blogs)

Suspension of [US] debt limit wins final congressional approval (Reuters) Congress passes debt ceiling increase that prevents nation going broke - but lawmakers must pass budget or lose their pay (The Associated Press)

No Budget, No Pay Act: A small step on the deficit, a giant leap toward accountability (The Hill blogs) The Senate May Have Passed 'No Budget No Pay,' But Congress Will Still Get Paid No Matter What (The Business Insider)

Ken "Ain't Different" Rogoff Crushes The Infinite Dream Of Crude Keynesian Stimulus (ZeroHedge blog)

Student Loan Debt: New Reports Find 'Unsustainable' Trend Dragging Economy (The Huffington Post blog)

Critical Warning No. 7: Banks crash economy again: Time to jail the bankers (Marketwatch)

Ex-Peregrine Chief Sentenced to 50 Years in Prison (The New York Times blogs)

Alps Electric Jumps on 3,000 Jobs Cuts to Stem Losses (Bloomberg)

Harman Intl FY Q2 Misses; To Cut Up To 1,000 Jobs (Forbes)

Sears Canada lays off 700 workers (The Canadian Press)

For 40 Years, This Russian Family Was Cut Off From All Human Contact, Unaware of World War II: In 1978, Soviet geologists prospecting in the wilds of Siberia discovered a family of six, lost in the taiga (Smithsonian Magazine)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Is it a recovery yet? (Weekly report, 01-31-13)


A recovery would be indicated by weekly initial jobless claims holding below 500,000. (See this post.)

IT'S A RECOVERY! (And it has been a recovery for every week since the Nov. 25, 2009 report, with the exception of the Aug. 19, 2010 report.)

"Initial jobless claims rose 38,000 in the week ended Jan. 26, the most since Nov. 10, to 368,000, the Labor Department reported today in Washington." (Bloomberg)

Initial jobless claims jump a week after falling to five-year low (The Los Angeles Times)

Initial jobless claims jump 38,000 to 368,000: Number of people applying for benefits back to late 2012 levels (Marketwatch)

SEE LAST WEEK'S POST HERE.

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Wednesday, January 30, 2013

Wednesday roundup (01-30-13)


Spain's recession deeper than thought (The Associated Press) Spain's economy shrinks again and remains deep in recession: GDP contraction of 0.7% raises doubts of government-heralded recovery as hard-up consumers continue to cut back spending (The Guardian)

Catalonia asks Spain for further 9bn euros bailout (The BBC)

Italy risks political crisis as MPS bank scandal turns 'explosive': Italian magistrates investigating losses at Banca Monte dei Paschi say the mushrooming scandal has taken a dramatic turn, with political fallout that threatens to rock the country’s elections next month and upset eurozone plans for a banking union. (The Telegraph) Monte Paschi ignored warnings over risk, documents show (Reuters)

Japan's coming debt crisis as an ageing population eyes retirement: Shinzo Abe's policies will provide a short-term lift in economic activity, but are unlikely to create a sustainable recovery by Satyajit Das (The Independent)

U.S. Growth Halted as Federal Spending Fell in 4th Quarter (The New York Times) U.S. Economy Unexpectedly Contracts in Q4 (Iacono Research) One more like that and it’s a ‘recession’ (The Washington Post blogs) Analysis: GDP report doesn't mean recession (USAToday)

Pa. budget chief says pension reforms essential (Bloomberg)

Stuck in reverse, Detroit edges closer to bankruptcy (Reuters)

Daimler Trucks Unit to Cut Up to 2,100 Posts to Boost Profit (Bloomberg)

Time Inc. cuts 500 people, 6 pct of workforce (The Associated Press)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Tuesday, January 29, 2013

Tuesday roundup (01-29-13)


JPMorgan bet against itself in "Whale" trade (Reuters)

Here We Go Again, Underpricing Europe Debt Risk (Bloomberg)

France 'totally bankrupt', says labour minister Michel Sapin: France's labour minister sent the country into a state of shock on Monday after he described the nation as “totally bankrupt”. (The Telegraph)

Spain's crisis strategy under fire as economy buckles again: Spain’s economy has tipped into an accelerating downturn as sales data and the money supply flash serious warnings, calling into question Madrid’s high-risk strategy of refusing an EU-IMF rescue. (The Telegraph) Spanish retail sales slump 10.7% as austerity hurts consumers: Retail figures in Spain have fallen for 30 successive months, the decline accelerating since latest austerity measures applied (The Guardian) Spain Budget Goal Relaxation Signaled Possible by Rehn (Bloomberg)

EU official's remarks [to the effect that Berlusconi did not "respect commitments"] stir Italian political storm (The Associated Press)

Italy’s Billion-Dollar Gambling Epidemic: The economic crisis in Europe is driving people to slot machines and video poker games. (Newsweek)

Mario Draghi confronts Berlin over contagion from Cyprus default: Leading European Union officials have warned Germany it would be a grave mistake to let Cyprus default or to impose losses on private creditors, fearing a repeat of errors made when Greece first flew out of control. (The Telegraph) ECB Warns of Euro-Zone Risk: Draghi Clashes with Berlin Over Aid to Cyprus: The head of the European Central Bank, Mario Draghi, warned German Finance Minister Wolfgang Schäuble last week not to dismiss Cyprus as not being 'systemically relevant' and said a failure to bail out the island nation could threaten the wider euro zone. (Spiegel Online)

Fitch: UK Faces 'Significant' Risk of Downgrade (CNBC)

Japan Cabinet Approves Record Budget (The Wall Street Journal) Japan okays $1-trillion budget for 2013: Will increase defence spending and public-words projects (The Associated Press) Why Japan should not fight deflation (The Cobden Centre)

Consumer Confidence in U.S. Falls to Lowest Level Since 2011 (Bloomberg) Consumer Confidence Plunges in January (Iacono Research) Will consumer pessimism plunge the U.S. into recession?: Consumer confidence is at its lowest level in more than a year. Now's not the time for austerity economics by Robert Reich (Salon)

US debt headed toward 200 percent of GDP even after 'fiscal cliff' deal (The Hill blogs)

Scholar At Conservative Think Tank Basically Tells Other Conservatives To Shut Up About The National Debt (The Business Insider)

How’s the deficit doing? Depends on your timeframe. (The Washington Post blogs)

The Non Zero-Sum Society by Robert Reich (The Huffington Post blog)

Why Employment in the U.S. Isn't Coming Back by Charles Hugh Smith (Of Two Minds blog)

Two U.S. senators [one Republican, one Democrat] press Justice Department on bank prosecutions (Reuters) Sens. Brown, Grassley Press Justice Department On "Too Big To Jail": Senators Question Whether “Too Big to Fail” Status of Some Wall Street Megabanks Undermines Government’s Ability to Prosecute Large Financial Institutions, Impose Appropriate Penalties (The United States Senate) [Their letter] (The United States Senate)

Triple-Digit Oil in Sight as Global Economy Heals (CNBC) Ten Reasons Why High Oil Prices are a Problem (Our Finite World)

Chesapeake CEO McClendon is leaving (Reuters) McClendon Out At Chesapeake - Is A Takeover Next? (Forbes) Chesapeake's McClendon will not receive 2012 bonus (Reuters)

Mayor Bloomberg plans to slash 2,500 teaching positions through attrition in proposed new $70.1 billion budget: No layoffs or tax increases are planned but schools could face cuts to staff and supplies (The New York Daily News)

Boston Scientific plans [up to 1,000] job cuts, 4Q tops St. view (The Associated Press)

Royal Liverpool Hospital trust 'to cut 600 jobs' (The BBC)

Mexico City's Mile-Deep Aquifer Tapping Suggests U.S. Is Polluting Water It May Someday Need (The Huffington Post)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Monday, January 28, 2013

Monday roundup (01-28-13)


Court backs Iceland over failed bank's debts (Reuters) News Iceland was not to blame for catastrophic 2008 bank collapse, rules European court (The Daily Mail) Iceland wins compensation case: Iceland does not owe money over Icesave collapse. (New Statesman)

Scandal of Italy's Monte Paschi means questions for Draghi (Reuters)

Postage Prices Rise, But USPS Teeters on Edge of Ruin (NBCNews)

JCPenney Is Eliminating All The Receptionists At Its Salons — Perhaps 1,000 Employees (The Business Insider)

VMware to cut 900 jobs, focus on strengths: The cloud infrastructure company will exit of certain lines of business and consolidate facilities. (ZDNet)

Lufthansa Technik to cut 650 jobs by 2015 (Air Transport World)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Sunday, January 27, 2013

Sunday roundup (01-27-13)


Preparing for a Perfect Storm: Stagnation in the developed world, uncertainty in China, and political instability in the Middle East could make for a rough 2013. by Nouriel Roubini (Slate)

Europe: No retreat from austerity [-- that was the message from the just-concluded World Economic Forum at Davos, Switzerland] (CNNMoney)

Basking in the shadows? Regulators are watching you [you = shadow bankers] (Reuters)

Failure to reach ECB could be catastrophic for Ireland, [Foreign Minister] Gilmore warns (The Irish Independent) Ireland plans to redo bank debt proposal (Reuters) Gilmore tells leaders of 'urgent' need for deal with ECB on debt (The Irish Times) Rescheduling our [Irish] debt won't help – we need a write-down: We must restore confidence so that consumers start spending again (The Irish Independent)

Clegg: [The UK] Government will not change course on austerity: Deputy prime minister Nick Clegg has said there is no 'Plan B' on tackling the economy despite seeing stagnant growth in 2012. (The Telegraph)

US Facing Fresh Financial Shock to Economy (The Financial Times)

The Untouchables: FRONTLINE examines why no Wall St. execs have faced fraud charges for the financial crisis (PBS Frontline) The Untouchables (PBS Frontline)


Watch The Untouchables on PBS. See more from FRONTLINE.


The Avengers: Will they be the ones who make the banks pay for the mortgage mess? [The American Lawyer via] (Patterson Belknap Webb & Tyler LLP) "1. In mid-2006, Bear Stearns induced investors to purchase, and Ambac as a financial guarantor to insure, securities that were backed by a pool of mortgage loans that -- in the words of the Bear Stearns deal manager -- was a 'SACK OF SHIT.'" [pdf launches as download] (Orrick)

Making Them Pay (and Confess) (The New York Times)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Saturday, January 26, 2013

Saturday roundup (01-26-13)


Davos summit ends with warnings on global economy (The Associated Press)

Carney says next two years decisive for banks (The BBC)

Italy central bank approves Monte Paschi bailout request (Reuters)

George Osborne's austerity plan 'risks lost decade' for UK economy: Top Goldman Sachs banker Jim O'Neill joins growing criticism of chancellor's pursuit of deficit reduction in face of stagnation (The Guardian) Soros hits out at Osborne's austerity programme: Economies face a prolonged period of “go-stop” as the massive injections of liquidity to deal with the financial crisis are unwound, George Soros, the billionaire financier and philanthropist said at the World Economic Forum in Davos, Switzerland. (The Telegraph)

Carney to put growth top of list: The new Governor of the Bank of England has signalled that he will put growth at the heart of his approach to the job and is willing to see higher inflation for longer in order to support the economy. (The Telegraph)

Exposed: The regime of fear inside Barclays - and how the boss lied and shredded the evidence (The Daily Mail)

Staggering Debts Have Wrecked Our Economic Future [in the US] (Problem Bank List)

S&P cuts Illinois credit rating to A-minus over pensions -- ["to the lowest level among all states and said it could fall further"] (Reuters)

Unofficial Problem Bank list declines to 825 Institutions (Calculated Risk blog)

Through The Wire: Reuters Layoffs [Amount to 3,000] (The New York Observer)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Friday, January 25, 2013

Friday roundup (01-25-13)


Quote of the Day:

[Speaking of Britain:] "What is blatantly evident is that the economy continues to find it very hard to generate even modest sustainable growth." -- Howard Archer, chief economist at research firm IHS Global Insight. (CBSNews)

Britain's economy flirts with "triple dip" recession (Reuters) UK heading for triple-dip recession as GDP shrinks 0.3% in fourth quarter: UK economy not expected to regain peak level for another two years – marking slowest recovery in a century (The Guardian) Britain halfway to triple-dip recession as manufacturing sector stalls: Government aim of rebalancing economy away from financial services towards manufacturing appears to have foundered (The Guardian) George Osborne firm on austerity as UK growth contracts: George Osborne said a deeper-than-expected contraction in UK growth in the fourth quarter would not deter him in his drive to reduce Britain's deficit. (The Telegraph) George Osborne ignores IMF's warnings on austerity plans: Chancellor advised to moderate austerity programme as Nick Clegg concedes that capital spending was cut too quickly (The Guardian)

'Stealing to eat' cases increase as [UK] austerity bites: Charities and police report rise in people shoplifting for groceries such as baby milk and food (The Guardian)

Defying campaign to beat deflation, Japan’s consumer prices fall 0.1 percent in 2012 (The Associated Press)

[US] Economy Feeds on Workers Who Delay Retirement (USAToday)

The jobs numbers have been terrific lately. Can we believe them? (The Washington Post blogs)

Hurricane Sandy, drought cost U.S. $100 billion (USAToday)

Choice of Mary Jo White to Head SEC Puts Fox In Charge of Hen House (Rolling Stone blogs)  [versus] Mary Jo White Is a Great Appointment: Chris Whalen [VIDEO] (Yahoo!'s The Daily Ticker)

Tim Geithner’s legacy: an unpopular bailout that helped save the economy (The Washington Post) Geithner's Legacy: Contention Through Financial Storms (The Associated Press)

The Road to Debt-Serfdom by Charles Hugh Smith (Of Two Minds blog)

Lufthansa Maintenance Unit Outlines 650 Job Cuts by 2015 (Bloomberg)

Hasbro 4Q revenue misses, to cut [about 550] jobs (The Associated Press)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Thursday, January 24, 2013

Thursday roundup (01-24-12)


The Global Economic Disease in 8 Points and the Cure in 4 Points by Charles Hugh Smith (Of Two Minds blog)

Dr Doom says quantitative easing will create zombie banks, firms and borrowers: Nouriel Roubini said at Davos that central bankers risked saddling the economy with debt-burdened QE addicts (The Guardian)

Italian bank seeks to calm investors over trades (The Associated Press) Monte Paschi plunges on derivatives loss (EuroNews)



Spanish Jobless Rate Hits Record After Rajoy’s First Year (Bloomberg)

Rising bad loans signal more pain for Spanish banks (Reuters)

[UK's] Austerity plan is failing, IMF tells Osborne: IMF's Olivier Blanchard suggests UK needs reassessment of fiscal policy including changes to tax and public spending (The Guardian blogs)

[In the US] We Need a Politician Like Carter Glass (American Banker)

[In Juneau, Alaska:] City, State balance sheets face $11 billion in unfunded retirement (Juneau Empire)

Symantec Seen Possibly Cutting More Than 1,000 Jobs in Restructuring - Analysts (Dow Jones Newswires)

United Continental to cut 600 jobs; reports loss (The Chicago Sun-Times)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Is it a recovery yet? (Weekly report, 01-24-13)


A recovery would be indicated by weekly initial jobless claims holding below 500,000. (See this post.)

IT'S A RECOVERY! (And it has been a recovery for every week since the Nov. 25, 2009 report, with the exception of the Aug. 19, 2010 report.)

"Applications for unemployment insurance payments decreased by 5,000 to 330,000 in the week ended Jan. 19, the fewest since the same week in 2008, the Labor Department reported today in Washington." (Bloomberg)

U.S. jobless claims drop to 5-year low; labor market healing (Reuters)

SEE LAST WEEK'S POST HERE.

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Wednesday, January 23, 2013

Wednesday roundup (01-23-13)


I.M.F. Forecast: Global Economic Growth Modest at Best (The New York Times) IMF: Pace of global economic growth is slowing (The Washington Post) IMF Cuts Global Forecasts on Second Year of Europe Contraction (Bloomberg)

Global jobless to hit record 200 million this year: ILO (Reuters)

Eurozone debt burden stayed high in 3rd quarter, barely changed at 90 percent of output (The Associated Press)

Austerity Fails: European Nations See Debt Grow Despite Deep Spending Cuts (Think Progress)

Ireland’s debt levels make for sobering reading (The Irish Independent) Eurostat says Irish debt growing faster than any other EU state (The Irish Times)

Bank of Spain Says Recession Deepened After Latest Cuts (Bloomberg)

Spain's Catalonia misses 2012 public deficit target: Catalonia posted Tuesday a 2012 public deficit equal to 2.3 percent of its gross domestic product, surpassing the 1.5 percent target set by Madrid for Spain's 17 autonomous regions. (Agence France Presse)

U.S. Budget Discord Is Top Threat to Global Economy in Poll (Bloomberg)

House Votes to Temporarily Suspend U.S. Debt Ceiling (Bloomberg) House votes to suspend debt limit (The Washington Post)

Does The U.S. Have Enough Water to Frack Its Way to Energy Independence? (Cliff Küle's Notes blog)

Italy's Unipol plans to shed 2,200 jobs: trade union (Reuters)

[Italy's] Unicredit to cut up to 1,000 jobs in Germany by end-2014: source (Reuters)

Lloyds Confirms 940 More Banking Job Cuts: Lloyds Banking Group confirms it is to axe more jobs, taking the estimated total of redundancies to 1,300 within just a few days. (Sky News)

[Off topic:] Beyoncé DIDN’T lip-sync at the inauguration. BUT… [while ". . . she did sing along with a pre-recorded backing . . . the live vocal is the one most people heard."] (Production Advice) Beyoncé Wasn’t Lip-Syncing: A professional musician goes deep in on the inaugural non-scandal. [warning: article contains gratuitous obscenity] (Slate) Raw: Beyonce's National Anthem Performance (The Associated Press)



     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Tuesday, January 22, 2013

Tuesday roundup (01-22-13)


Bank of Japan Moves to Fight Deflation (The New York Times) Bank of Japan in boldest attempt yet to revive economy (Reuters) Credit-easing steps taken by Bank of Japan, Fed and other central banks, at a glance (The Washington Post) Back in Power, Abe Aims to Spend Japan Back to Economic Vitality (The New York Times blogs)

Central bankers should be brought to heel by elected parliaments: Intellectual fashion is changing. Central bankers around the world no longer command the charisma of a high priesthood. (The Telegraph) The Bank of Japan is coordinating policy with the Japanese government. That is a big deal. (The Washington Post blogs)

Bundesbank Chief Warns of Threat to Central Bank Independence (Agence France Presse) Weidmann says BoJ policy risks a currency war (City A.M.) Japan's Abe risks a familiar debt debacle (The Business Spectator) Euro zone has no general to fight a global currency war (The Globe and Mail of Toronto)

'Old people should hurry up and die', says Japan deputy leader: Taro Aso, Japan's deputy prime minister, has been forced to pedal back from a suggestion that old people should "hurry up and die" to save the state the cost of providing them with medical care. (The Telegraph) Let elderly people 'hurry up and die', says Japanese minister: Taro Aso says he would refuse end-of-life care and would 'feel bad' knowing treatment was paid for by government (The Guardian)

Rehn Backs Loan Extension for Ireland, Portugal (CNBC)

[UK] Austerity latest: spending up, deficit up. (The Spectator blogs)

Budget experts say prolonged debt-ceiling debate [in the US would be] a 'big mistake' (The Hill blogs) Suspending the debt ceiling is a great idea. Let’s do it forever! (The Washington Post blogs)

Fed President: Dodd-Frank Made 'Too Big To Fail' An Even Bigger Problem (The Huffington Post blog) Dallas Fed’s Fisher proposes restructuring of too big to fail institutions (Bank Credit News)

FDIC’s Hoenig urges removal of non-bank safety net, return to Glass-Steagall (Bank Credit News)

[UK] Defence Cuts: 5,300 Soldiers To Lose Jobs: A third round of redundancies will see the Army shrink to 80,000 soldiers - its lowest level since the 18th century. (Sky News)

Blockbuster to close [300] stores and cut [about 3,000] jobs (CNNMoney)

Cons on the rise as money troubles bite: Financial pressures on individuals have led to a resurgence in smaller-scale fraud, a new study suggests. (The Telegraph)

Nassim Taleb Talks Antifragile, Libertarianism, and Capitalism's Genius for Failure (Youtube)



     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Monday, January 21, 2013

Monday roundup (01-21-13)


Greek eurozone exit still likely despite European leaders resolve, warn economists: Greece is still likely to leave the eurozone, according to leading economists, but it could take several years as the European leaders resolve to save the debt-laden country has been underestimated. (The Telegraph) IMF sees up to 9.5 billion euro Greek funding gap in 2015-2016 (Reuters)

Troika Travails: Split Emerges Over Cyprus Bailout Package: Cyprus is in urgent need of money from the euro rescue fund, but the troika responsible for the bailouts is split over how it should be structured. The IMF is worried that the country's debt load is not sustainable. (Spiegel Online)

Heavy Snow Heightens Risk of Triple Dip [in the UK] (The Financial Times) Never mind the snow – it's austerity that's disrupting the economy: Tory economic policy has encouraged a fall in productivity over five quarters: if that carries on, it means a structural crisis (The Guardian)

Jim Cramer Was Right—They Knew Nothing! (CNBC) Wall Street Crying (Youtube)



State [of Minnesota] pension plans underfunded by over $16 Billion: Minnesota's public pension plans for government employees are underfunded by $16.7 billion — a deficit that's $4 billion larger than it was when lawmakers took steps to fix the problem in 2010. (The Associated Press)

Illinois Democrats still eye borrowing to pay down $9 billion in overdue bills (The Associated Press)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Sunday, January 20, 2013

Sunday roundup (01-20-13)


EU approach to solving state solvency problems is baffling and inconsistent: The Cypriot bailout will be bigger than Greece, Portugal and Ireland's – yet it may be about to get sizable haircuts (The Irish Independent)

EU doubts put pound's 'safe haven' status at risk, traders warn: The pound risks losing the 'safe-haven' status it has enjoyed among international investors as doubts grow over Britain's future in the European Union, one of the world's largest currency traders has warned. (The Telegraph)

Big Banks’ Biggest Foe Says It’s Time to Break Up (The Fiscal Times) Mr. Fisher Goes to Washington (The Economic Populist) Ending 'Too Big to Fail': A Proposal for Reform Before It's Too Late (With Reference to Patrick Henry, Complexity and Reality) by Richard W. Fisher (The Federal Reserve Bank of Dallas)

QBE poised to cut hundreds of jobs [= 700]: report (The Australian Associated Press)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Saturday, January 19, 2013

Saturday roundup (01-19-13)


Euro zone to tackle thorny question of aid for banks (Reuters)

Nostradamus Predicted: Max Keiser will cause WW3 [in reality, comments on Germany's request for its gold] (Russia Today)



German Gold Move Has Traders Worried: Two of the Fast Money traders explain why they're worried that Germany wants to reclaim a lot of its gold from the vaults of the New York Federal Reserve (CNBC)



“The Yen Is Doomed”: For Japan, This Time Really Is Different, Merk Says [there is a video, but The Daily Ticker has not enabled embedding for it] (Yahoo!'s The Daily Ticker)

How to Cut Megabanks Down to Size (The New York Times) Dallas Fed: Small Banks Key to Financial Stability (Yahoo! Finance blogs)

Unofficial Problem Bank list declines to 826 Institutions (Calculated Risk blog)

Blockbuster UK administrators to shut 129 stores, cut 760 jobs (Reuters)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Friday, January 18, 2013

Friday roundup (01-18-13)


Euro zone’s debt crisis and austerity policies continue to tamp down growth – UN report (UN News Centre)

IMF chief urges big world economies to promote growth (Reuters)

Is the eurozone's core cracking up?: Political uncertainty has always surrounded a German-led solution to the crisis – but Berlin's economic woes mean it may soon no longer be plausible (The Guardian)

Greece to need more EU debt help as soon as next year: IMF (Agence France Presse) IMF Says Greece Will Need More Money, Has Elevated Risks (Bloomberg)

Italy’s Recession to Be Deeper Than Expected, Central Bank Says (Bloomberg) Bank of Italy sees gloom deepening for economy (Reuters)

Italy Needs 9 Billion Euros for Deficit Goal, Official Says (Bloomberg)

IMF says eurozone needs Portugal to stick with its austerity program despite hardship (The Associated Press)

[US] Consumer Sentiment Falls Again (Iacono Research)

House Republicans agree to vote on bill to raise debt limit for 3 months (The Washington Post) Raising the Debt Ceiling, Inch by Inch (The New York Times blogs) Difficult Choices on Debt if the U.S. Hits the Ceiling (The New York Times)

The Trillion Dollar Coin: Joke or Game-Changer? by Ellen Brown (TruthDig)

Geithner says history will validate unpopular Wall Street bailouts (The Hill blogs)

Days Before Housing Bust, Fed Doubted Need to Act (The  New York Times) Fed Slow to Grasp Crisis in 2007 as Yellen Sounded Alarm (Bloomberg) Janet Yellen for Fed Chair! (CNN) Federal Reserve was blind to crisis in 2007 (CNNMoney) FOMC: Transcripts and Other Historical Materials, 2007 (Board of Governors of The Federal Reserve System)

Leveling the Playing Field: Financial reform must be redirected. The government’s financial safety net for the biggest banks should cover only their essential banking activities and their role in the payments system. Once that occurs, market discipline can reassert itself, and all institutions — large and small — can compete on a more level playing field. (The Dallas Fed)

Regulators shut down small lender in Minnesota, representing 2nd bank failure of 2013 (The Associated Press) 1st Regents Bank of Andover MN had a troubled assets ratio of 335.1%. (BankTracker) 1st Regents Bank, Andover, MN, Closed By Regulators (Problem Bank List)

Cargill meatpacking plant cuts 2,000 jobs in Texas (The Associated Press)

State Street Corp. discloses plans to cut 630 jobs (The Boston Globe)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Thursday, January 17, 2013

Thursday roundup (01-17-13)


A new Gold Standard is being born (The Telegraph blogs)

S&P sees deeper house price falls in eurozone as slump engulfs core: Europe’s housing slump is engulfing large parts of the eurozone core as recession deepens, with prices to keep sliding for another two years, Standard & Poor’s has warned. (The Telegraph)

Germany’s Entire Gold Hoard At The Fed May Already Be Gone (King World News blog)

Britain has more debt than the eurozone, says Germany's Wolfgang Schaeuble: Germany's finance minister Wolfgang Schaeuble has said that the problem of high indebtedness is not limited to the crisis-hit eurozone and that the situation in Britain and the US is worse. (The Telegraph)

U.S. Financial Position Worsened in 2012 on Higher Debts (Bloomberg)

Philly Fed Manufacturing Survey Shows Contraction in January (Calculated Risk)

Debt-ceiling economics and politics (Econbrowser)

Fed's Fisher: Reorganize banks that are 'too big to fail' (Reuters)

Banking Safety Net Makes Wall Street Dangerous by Thomas M. Hoenig, vice chairman of the Federal Deposit Insurance Corp. (The American Banker)

The Legacy of Timothy Geithner by Simon Johnson (The New York Times blogs)

Social Security Cliff in Sight; Retirees Will Outlive Trust Fund; Ramifications of Nonmarketable IOUs and Privatization (Mish's Global Economic Trend Analysis blog)

Commerzbank to Propose Cutting Around 6,000 Jobs (Dow Jones Newswires)

Deutsche Telekom to Cut 1,200 Jobs in Germany (Dow Jones Newswires)

Nokia slashes another 1000 jobs in Finland (Neowin)

[Finland's] UPM to slash nearly 900 jobs worldwide (YLE)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Is it a recovery yet? (Weekly report, 01-17-13)


A recovery would be indicated by weekly initial jobless claims holding below 500,000. (See this post.)

IT'S A RECOVERY! (And it has been a recovery for every week since the Nov. 25, 2009 report, with the exception of the Aug. 19, 2010 report.)

"Initial jobless claims fell sharply last week to 335,000, the lowest level in five years in a hopeful sign for the labor market as the new year begins." (The Los Angeles Times)

"... but the drop likely stemmed from a beginning-of-the-year quirk whose effects may soon fade and push first-time filings back up." (Marketwatch)

Jobless Claims in U.S. Fell to Lowest Level in Five Years (Bloomberg)

SEE LAST WEEK'S POST HERE.

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined.

Wednesday, January 16, 2013

Wednesday roundup (01-16-13)


The World Bank Just Slashed Its Forecasts For Global Growth (The Business Insider)

Europe drawn into global currency wars as slump deepens: The world is edging closer to all out currency conflict as Europe’s politicians join a chorus of policy-makers across the globe pushing for devaluations to fight for market share. (The Telegraph) Russia Says World Is Nearing Currency War as Europe Joins (Bloomberg)

EU launches search for most dangerous financial product (The Telegraph) Competition: Europe seeks the most dangerous financial product (Dangerous Financial Products)

The Re-emergence of Europe: The Fallout From Europe's Debt and Banking Crisis (The Huffington Post blog)

Deutsche Bank co-CEO says eurozone crisis not over (Reuters)

Germans to Repatriate Much of their Gold [numerous links presented in this report] (Iacono Research)

Draghi’s Bond Rally Masks Debt Doom Loop Trapping Spain (Bloomberg)

Irish PM warns UK exit from EU would be 'catastrophic' (Agence France Presse)

Lloyds and RBS need billions more capital, BoE says: Britain's bailed-out banks need billions of pounds more capital to shore up their balance sheets and support the economy, senior Bank of England officials have warned. (The Telegraph)

Too big to fail and too big to bail out: New report argues that the financial crisis [in the UK] has exposed the risks associated with a large financial sector. (FT Adviser) Don’t bank on it: The financialisation of the UK economy (The Institute for Public Policy Research)

IMF’s Zhu Says Japanese Debt Overhang Is Getting More Serious (Bloomberg)

GOP holding U.S. economy hostage on debt (CNN) Now It's the Debt, Politicians and the Economy, Stupid (CNBC)

Geithner expects debt ceiling breach in February or March (USAToday)

In latest debt-ceiling move, Treasury to tap Thrift Savings Plan money (The Washington Post)

BofA sees recession threat from ‘few weeks’ at debt ceiling (Marketwatch)

Debt ceiling: Is Social Security at risk? (CNNMoney)

Freshmen in Congress worth $1 million more than you (CNNMoney)

Reports foresee trillion-dollar spending gap for U.S. infrastructure (The Washington Post) The Cost of America's Crumbling Roads and Bridges (CNBC)

Crop insurance could cost record $16 billion: Taxpayer-subsidized program has drawn widespread criticism, but Congress has resisted efforts to reduce spending. (The New York Times)

Unfunded retirement obligations for Alaska at $11 billion (Alaska Dispatch)

[Japan's] Renesas to Cut More Than 3,000 Additional Jobs Under Rescue Plan (Bloomberg)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.

Tuesday, January 15, 2013

Tuesday roundup (01-15-13)


The Eurozone Crisis Is Over, but the Eurozone Economy Is Worse Than Ever (Slate) Euro-zone debt crisis enters challenging new phase: Central bankers win battle, but not the war (Marketwatch)

German Economy Probably Contracted 0.5% in Fourth Quarter (Bloomberg) German Economy Slows Sharply as Crisis Hits Home (CNBC) Slowdown in Germany Worries Euro Zone (The New York Times)

Bundesbank to pull gold from New York and Paris in watershed moment: Germany’s Bundesbank is to repatriate gold reserves held abroad to tighten control and combat currency crises in the future, pulling a chunk of its holdings from New York and all its bullion from Paris. (The Telegraph) It Begins: Bundesbank To Commence Repatriating Gold From New York Fed (Zero Hedge blog)

UK's AAA credit rating under 'significant pressure', warns Fitch: Ratings agency says slow recovery and fiscal consolidation leaves Britain vulnerable to fresh economic shocks (The Guardian)

[Meanwhile, back at the ranch:] Fitch warns that debt-limit delay could hurt U.S. credit rating: The company says lawmakers should not use raising the nation's debt limit as leverage to get government spending cuts. (The Los Angeles Times) Credit Rating Agency Warns of Downgrade if Debt Limit Is Not Raised (The New York Times blogs)

4 Ways to Avert the Debt Ceiling (and the Most Likely Option Is the Scariest): Here's why Ben Bernanke killed the platinum coin, and what it means for the debt-ceiling showdown (The Atlantic)

US Postal Service faces ruin without rescue from Congress, watchdog warns: Inspector general David Williams says cash-strapped service, saddled with debt and low revenues, is in 'very serious trouble' (The Guardian)

Anglo platinum arm sheds 14,000 jobs, risking unrest (Reuters)

Air Berlin to cut 900 jobs in savings drive (Reuters)

Renault to Cut 17% of French Jobs on European Car Market [= 7,500 positions] (Bloomberg)

     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest an energy shock may be coming much closer in time than is generally imagined.