Thursday, February 28, 2013

Thursday roundup (02-28-13)


European Recovery Path in Danger as Politics Menace Growth (Bloomberg)

Eurozone inflation down, interest rate cut to follow? (EuroNews)



France’s economy: Austerity stakes: A reluctant government faces the imperative of public-spending cuts (The Economist)

Italy election punches hole in ECB's euro defenses (Reuters)

Italy vote arms critics of Berlin's austerity mantra (Reuters)

Monte Paschi says receives state bailout (Reuters)

Spain recession deeper than previously thought after 0.8 percent Q4 contraction (The Associated Press) Spain's economy shrinks ["for the sixth straight quarter"] under debt pressure in 2012 (Reuters)

EU 'Troika' rule in Ireland worse than British Empire: Ireland's trade union chief has accused the EU-IMF troika in charge of Irish austerity policies of tipping the economy into downward spiral and acting as an imperial oppressor. (The Telegraph)

Cyprus president says committed to stability, swift bailout (Reuters)

Slovenia can avoid bailout, PM-designate says (Reuters)

As Sequester Looms, U.S. Set To Repeat Europe's Austerity Mistake (The Huffington Post blog)

Fed: Consumer Debt increased slightly in Q4, "Deleveraging Process Decelerates" (Calculated Risk blog)

Bernanke’s Credibility on ‘Too Big to Fail’ by Simon Johnson (The New York Times blogs)

Internet banking leads Rabobank to close branches, cut 3,000 jobs (DutchNews)

Caterpillar to cut 1,400 jobs at plant in Belgium, blames high labor costs and sluggish growth (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.

Is it a recovery yet? (Weekly report, 02-28-13)


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.)

"First-time jobless claims dropped more than expected last week to 344,000 and the number of people collecting unemployment benefits fell to its lowest level since mid 2008, the Labor Department said Thursday." (The Los Angeles Times)

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, February 27, 2013

Wednesday roundup (02-27-13)


High unemployment threatens future of the EU - ministers (Reuters)

Draghi Says ECB in No Rush to Tighten as Inflation Slows (Bloomberg)

Euro zone mulls help for Portugal, Ireland market return - sources (Reuters)

Italy's Grillo rules out voting for center-left government (Reuters) In Italy's Disarray, Berlusconi Emerges Anew as a Power (Bloomberg) The Berlusconi Effect: Political Gridlock Wins Italian Elections: First the good news: Silvio Berlusconi didn't win the Italian election. But the bad news is disturbing enough. Center-left leader Pier Luigi Bersani was unable to win control of the Senate, meaning that a stable government in Italy looks unlikely. The results for Europe could be devastating. (Spiegel Online) Italy Investors Will Force Bersani-Berlusconi Deal, Polillo Says (Bloomberg)

Italy turmoil raises questions about ECB backstop (The Associated Press)

Monti Government Mulls Delaying Monte Paschi Bailout (Bloomberg)

Spain’s Bankia-Led Bailout Won’t Spell End of Bank Troubles (Bloomberg)

Slovenia Replaces Premier Amid Battle to Avoid Bailout (Bloomberg) Slovenia’s Economy Contracted Further on Austerity, Survey Shows (Bloomberg)

Economists See [US] Budget Cuts Putting The Recovery At Risk (National Public Radio)

Fitch warns U.S. risks losing AAA debt rating (USAToday)

Bernanke tells Warren ‘too big to fail’ banks ‘will voluntarily reduce their size’ (The Raw Story)

Grand Old Parity by Sheila C. Bair (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.

Tuesday, February 26, 2013

Tuesday roundup (02-26-13)


Italy’s Political Mess: Why the Euro Debt Crisis Never Ended (Time)

Electoral Deadlock in Italy Rekindles Anxiety Over Economies in Euro Zone (The New York Times) Why Italy’s Stalemate Could Mean Chaos for Euro Zone (CNBC)

ECB bond plan in jeopardy as Italy's voters reject conditions: Italy's electoral earthquake is “a catastrophe for the euro and the European Union”, according to Luxembourg’s foreign minister, Jean Asselborn. (The Telegraph)

Italy's anti-austerity vote raises the spectre of a bailout: Current bond yields suggest a touching faith that a workable political fudge will emerge sooner or later. But what if it doesn't? (The Guardian) ‘Ungovernable’ Italy: Debt crisis back on table: More market turmoil as investors deal with ‘worst-case’ outcome (Marketwatch) Elezioni, Bersani sfida Grillo: "Pronti a cambiare, dica cosa vuole fare":  Il segretario del Pd ammette la delusione: "Non abbiamo vinto anche se siamo arrivati primi". Poi, incalzato anche da Vendola, apre all'ipotesi di un governo che cerchi in Parlamento l'appoggio dei grillini su un pacchetto di leggi su "riforma della politica, nuova legge sui partiti, moralità pubblica e privata".  Il coordinamento del partito dà il via libera all'apertura al M5S ma Fioroni ammonisce: "Non inseguiamo i grillini sul loro terreno" (La Repubblica)

Italy must reduce unsustainably high level of debt - EU Commission (Reuters) EU Chiefs Tell Italy There’s No Alternative to Austerity (Bloomberg) Eurozone Commission President Pleads With Europe To Continue Austerity (Think Progress) Italian election: stalemate threat sends shivers through the eurozone: Poll cliffhanger brings fears that outgoing prime minister Mario Monti's austerity programme could be paralysed (The Guardian) ANALYST ON ITALY: 'This Could Become A Major Problem...' (The Business Insider)

Spain extremely worried by impact of deadlocked Italy vote (Reuters)

Portugal opposition chief demands renegotiation of bailout (Reuters)

Bank of England ready to pump more cash into the UK economy: Deputy governor Paul Tucker told MPs he was open to more quantitative easing, depending on the outlook for growth (The Guardian)

[UK] Bank chief raises the prospect of a base rate BELOW zero in bid to kickstart spending (The Daily Mail) Bank of England mulls negative interest rates: Deputy Governor floats plan that could mean new charges for customers (The Independent) Bank of England considers negative interest scheme for high-street banks: Deputy governor hints at move aimed at helping to boost economy through loans to small businesses (The Guardian) Don't worry: the Bank of England will never allow negative interest rates (The Telegraph blogs)

Bernanke Says Fed Reduced Risk of ‘Japanese-Style’ Deflation (Bloomberg)

350 Economists Warn Sequester Cuts Could Kill Recovery (The Huffington Post blog) Bernanke: Spending cuts add 'significant' burden to recovery (CNNMoney)

Elizabeth Warren, Ben Bernanke Clash Over 'Too Big To Fail' (The Huffington Post blog)

The Political Importance of Elizabeth Warren by Simon Johnson (Project Syndicate)

JPMorgan Says Mortgage Unit, Community Bank May Lose 19,000 Jobs (Bloomberg) JPMorgan To Slash 15,000 Mortgage Jobs By End Of 2014, Save $3B (Forbes) J.P. Morgan to cut 4,000 jobs in 2013 (Marketwatch)

     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, February 25, 2013

Monday roundup (02-25-13)


Split Vote Sends One Clear Message in Italy: No to Austerity (The New York Times) Italy vote shows backlash against political establishment: An inconclusive outcome may unnerve investors. Pier Luigi Bersani looks likely to be prime minister, and comedian Beppe Grillo has a stunning success. (The Los Angeles Times) Italy Voters Stay Home as Turnout on Pace for Post-WWII Low (Bloomberg) Elezioni 2013, i risultati dello spoglio: alla Camera maggioranza di centrosinistra. Senato spaccato, è stallo. 5 Stelle primo partito (La Repubblica)

After election win, Anastasiades tackles Cyprus bailout (Reuters)

Is Asia Heading for a Debt Crisis? (Time)

GOP pushes back on Obama sequester warnings, says he should seek deal (The Washington Post) White House releases state-by-state breakdown of sequester’s effects (The Washington Post)

Chicago Fed: "Economic Growth Moderated in January" (Calculated Risk blog)

High Debt Threatens Economic Growth (The Heritage Foundation blogs)

CaixaBank Says 3,000 Jobs May Be Affected by Cost-Cutting Plan (Bloomberg)

Crédit Agricole could cut 1,400 jobs: report (Agence France Presse)

QBE Insurance to Cut 700 Jobs (Dow Jones Newswires)

     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, February 24, 2013

Sunday roundup (02-24-13)


Trade protectionism looms next as central banks exhaust QE: Officials at the US Federal Reserve may be more worried than they have let on about the treacherous task of extricating America from quantitative easing. This is an unsettling twist, with global implications. (The Telegraph) Bernanke's challenge: prime markets for policy turn (Reuters) Crunch Time: Fiscal Crises and the Role of Monetary Policy (The University of Chicago Booth School of Business)

Why Italy Continues to Rain on Europe's Parade (CNBC)

Troika to review Portugal bailout, revisions seen (Reuters)

Cypriot president-elect vows to work for swift bailout deal (Reuters)

Britain’s Economic Malaise Brought Ratings Downgrade (The New York Times) Osborne Sticks With Austerity as Investors See Downgrade as Late (Bloomberg) Moody’s downgrade of the UK doesn’t matter—so why are you reading about it? (Quartz)

Governors say budget cuts will kill economic and job growth, urge Washington to compromise (FoxNews) GOP govs to Hill: Get back to bargaining table (Politico)

Helaine Olen Extended Interview Pt. 1: In this exclusive, unedited interview, journalist Helaine Olen explains the origins of the 401k and personal finance industry. (The Daily Show with Jon Stewart)



Helaine Olen Extended Interview Pt. 2: In this exclusive, unedited interview, Helaine Olen discusses the financial services empire and the economic fallacies driving the tech and real estate bubbles. (The Daily Show with Jon Stewart)



Helaine Olen Extended Interview Pt. 3: In this exclusive, unedited interview, "Pound Foolish" author Helaine Olen calls for a reassessment of the way investments are valued. (The Daily Show with Jon Stewart)



The rich corporate bankers destroyed the Glass-Steagall Act that protected us, the people (Marianas Variety of Micronesia)

     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, February 23, 2013

Saturday roundup (02-23-13)


France to pause austerity, cut spending next year instead: Hollande (Reuters)

Why Italy needs to vote for austerity (The Independent) Italians Vote With Berlusconi Challenging Monti Austerity (Bloomberg) Italian poll leader warns of meltdown 'worse than Greece' (The Irish Independent) Q&A: Investors are wary of the outcome of the Italian elections and the effect on the eurozone (The Washington Post)

Cyprus votes for president as clock ticks on bailout deal (Reuters)

[UK's] Osborne To Continue With Austerity Programme Despite AAA Downgrading (The Huffington Post blog)

Obama on Sequester: "Budget Cuts Will Slow Economy, Eliminate Good Jobs": President Obama pushes alternate plan for avoiding budget cuts in weekly address. (ABCNews)





Unofficial Problem Bank list declines to 809 Institutions (Calculated Risk blog)

Thin Snowpack in West Signals Summer of Drought (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.


Friday, February 22, 2013

Friday roundup (02-22-13)


EU Says Euro Area to Shrink in 2013 as Unemployment Rises (Bloomberg) Euro zone economy to shrink again in 2013, EU says (Reuters) Renewed Signs of Europe’s Economic Weakness (The New York Times) Eurozone still stuck in reverse thanks to austerity (The Independent)

Another warning signal for European capitals: If the latest economic projections from the European Commission are to be believed, expect greater socio-political fragility in 2013 by Mohamed El-Erian (Fortune)

Fed's Tarullo urges global action on regulating banks (Reuters)

The Central Bank Revolution: Hinde Capital: "Central Bankers are the Devil" (Cliff Küle's Notes blog)

Spain, France to miss debt goals as euro zone stays in recession (Reuters)

Rehn Says Spain Must Convince EU on Deficit to Win Delay (Bloomberg)

Portugal Posts Budget Deficit for January as Spending Rises (Bloomberg) Too early to decide on Portugal deficit deadline, EU's Rehn says (Reuters)

Italy vote may bring opposite of what country needs (Reuters)

Mammoth debt hangs over next Italian government (Reuters) Bersani warns country could go the way of Greece: The frontrunner to become the country's next prime minister has warned of a Greek-style social and economic meltdown if austerity measures are not maintained. (The Telegraph)

Moody's strips UK of coveted triple-A debt rating (Reuters) Moody's downgrades United Kingdom from AAA (CNNMoney) George Osborne under pressure as Britain loses AAA rating for first time: Chancellor vows to stick to course after downgrade by Moody's, which blamed subdued growth and rising debt burden (The Guardian)

Japan Reflation Inspired by Braintrust Created by Shinzo Abe (Bloomberg)

Budget Cuts Seen as Risk to Growth of US Economy (The New York Times)

Fed's Bullard: Fed Policy to Stay 'Easy' for 'Long Time' (CNBC) Fed unlikely to curtail stimulus despite rising doubts (Reuters)

Stanley Druckenmiller: "We Have An Entitlement Problem" And One Day The Fed's Hamster Wheel Will Stop (Zerohedge blog) Generational Theft Needs to Be Arrested: A Democrat, an independent and a Republican agree: Government spending levels are unsustainable. (The Wall Street Journal) Automatic Spending Cuts Are a Joke: Druckenmiller (CNBC) (CNBC)



Nouriel Roubini Is Bullish…For Now: “The Mother of All Bubbles” Has Begun [VIDEO] (Yahoo!'s The Daily Ticker)

Credit Suisse faces U.S. probe into mortgage products (Reuters)

Jon Corzine Avoids Lifetime Trading Ban As Regulator Punts To Feds (The Huffington Post blog)

Four Largest Banks Are Now Almost As Big As US GDP: Accounting Hides Risks - Taleb on Fragility (Jesse's Café Américain blog)

Taleb on Markets, Banking Industry, Fiscal Policy: Nassim Nicholas Taleb, a New York University professor and author of "The Black Swan" and "Antifragile: Things That Gain From Disorder," talks about financial markets, the banking industry and fiscal policy. He speaks with Erik Schatzker and Sara Eisen on Bloomberg Television's "Market Makers." (Bloomberg)



ObamaCare: The Neutron Bomb That Will Decimate Employment (Of Two Minds blog)

Bitter Pill: Why Medical Bills Are Killing Us (Time) TIME’s Best Cover Story Ever: Why are the medical bills so high? (Physicians News Digest)

Steven Brill Extended Interview Pt. 1: In this exclusive, unedited interview, Steven Brill explains the large discrepancy between what hospitals charge and what medical services actually cost. (The Daily Show with Jon Stewart)



Steven Brill Extended Interview Pt. 2: In this exclusive, unedited interview, journalist Steven Brill examines the enormous profits reaped by the not-for-profit health care industry. (The Daily Show with Jon Stewart)



Steven Brill Extended Interview Pt. 3: In this exclusive, unedited interview, Steven Brill warns against the combination of profit motive and no accountability that characterizes the health care industry. (The Daily Show with Jon Stewart)



Commerzbank To Cut 1,800 Retail Branch Jobs By End '15; Aims To Avoid Layoffs (Dow Jones Newswires)

     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, February 21, 2013

Thursday roundup (02-21-13)


Europe's Growth Crisis Persists As Debt Crisis Eases (Investors Business Daily)

Austerity Fail: After Massive Spending Cuts, European Countries Fail To Hit Deficit Targets (Think Progress)

GOLDMAN: Europe Needs More Austerity (The Business Insider)

France freezes spending to hit EU targets as slump deepens: France is to freeze spending on defence, higher education and research in a frantic bid to meet European Union deficit targets this year, tightening fiscal policy yet further as the country slides into deep slump. (The Telegraph)

Spain and Italy: The Euro Crisis Gnaws at Europe's Underbelly: The euro crisis may have dropped out of the headlines recently, but Spain and Italy would seem to be doing their best to bring it back. Real estate giant Reyal Urbis' bankrupcy has raised fresh concerns about Spanish banks and many fear that a Berlusconi election victory could drive Rome to seek emergency aid. (Spiegel Online)

EU parliament chief tells Italians not to vote for Berlusconi (Reuters) Berlusconi's last throw of the dice in Italy election (Reuters) A crisis in waiting as Italians prepare to head to the polls (The Globe and Mail of Toronto)

Can Italy Get Back on the Path of Economic Growth? (Yahoo! blogs)

Intesa CEO: 20% of Italy's Firms 'Won’t Make It’ (CNBC)

Italy's best are emigrating at time of crisis (Reuters)

In hard-hit Spain, bartering becomes means of getting by (USAToday)

Don’t Underestimate the Economic and Financial Effects of the Sequester [on the US Economy]: Nouriel Roubini [VIDEO] (Yahoo!'s The Daily Ticker)

Strike Three! The American Consumer Is Out (CNBC)

Credit card debt slows down the economy (WANE)

Chesapeake probe finds no "intentional" CEO misconduct (Reuters)

One In Three Fish Sold At Restaurants And Grocery Stores Is Mislabeled (National Public Radio blogs) Something fishy on your plate: Study finds rampant mislabeling of seafood sold in U.S. (CBSNews) Fake Fish On Shelves And Restaurant Tables Across USA, New Study Says (Forbes) Oceana Study Reveals Seafood Fraud Nationwide (Oceana) [report in pdf] (Oceana)

     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, 02-21-13)


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.)

"Jobless claims increased by 20,000 to 362,000 in the week ended Feb. 16, the Labor Department reported today in Washington." (Bloomberg)

Has The Declining Trend In Jobless Claims Run Its Course? (The Capital Spectator)

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, February 20, 2013

Wednesday roundup (02-20-13)


Rome will burn, regardless of Italian election result (Reuters)

Bad loans at Italian banks reached 125 bln euros at end 2012 (Reuters) Italian bank lending drops to record low: Association warns of more dud loans and deepening recession (Gazetta del Sud)

Portugal May Get Extra Year to Narrow Deficit: Gaspar (Bloomberg)

Euro zone bailout fund says Cyprus a potential contagion risk (Reuters) S&P ratings agency warns that Cyprus faces default (Deutsche Welle)

Losing our AAA rating [in the UK] could mean bank collapse and deflation: Like a condemned man, the British government awaits the sentence. It’s ceased to be a question of whether we’ll lose our AAA rating, but when. (The Telegraph)

Federal Reserve unlikely to end stimulus efforts soon, minutes signal (The Washington Post) Fed Officials Divided on Future of QE (CNBC) Has the Fed Gone Wobbly on QE3?: Most on monetary committee still support asset purchases, but worries are also growing (U. S. News & World Report)

Langone: Fiscal Storm Coming Due to Debt: Home Depot Founder Ken Langone told CNBC that pursuing President Barack Obama's politics are "generational theft of an enormous magnitude (CNBC)



U.S. Banks Bigger Than GDP as Accounting Rift Masks Risk (Bloomberg) Why The Nation’s Biggest Banks Are Even Bigger Than You Thought (Think Progress) THE REAL PROBLEM WITH THE BIG BANKS (The New Yorker blogs)

Spain's Caixabank planning significant job cuts [= 4,000 jobs]: sources (Reuters)

Volvo Cars to Cut 1,000 Jobs in 2013 (Dow Jones Newswires)

Telstra to cut 648 Sensis jobs: Telstra has confirmed that it will cut 648 roles in a restructure of its ailing advertising subsidiary Sensis. (ZDNet)

     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, February 19, 2013

Tuesday roundup (02-19-13)


OECD economies shrank at end of 2012: GDP across 34 Organisation for Economic Co-operation and Development members fell 0.2% in final quarter of last year (The Guardian) OECD economies contract for first time since 2009 (EuroNews)



European Car Sales Fall 8.7% to Record Low (The New York Times)

Possible Berlusconi comeback is nightmare for Merkel (Reuters)

Obama warns Congress over spending cuts: 'People will lose their jobs': President takes tough line against Republicans he says are jeopardising US economic stability by refusing to compromise (The Guardian) Obama presses Congress for stopgap sequester fix (The Washington Post)

Simpson and Bowles Keep Pushing With New Deficit Plan (ABCNews) Memo to Congress, White House: Get serious on debt (Politico) A Bipartisan Path Forward to Securing America's Future (Moment of Truth Project) Erskine Bowles pessimistic about a ‘grand bargain’ (Politico) New Bowles-Simpson deficit plan would cut $2.4 trillion (CNNMoney) Sequestration Is Austerity, but Not Enough for Simpson and Bowles (The Nation blogs)

Wonkbook: So many sequester replacements (The Washington Post blogs)

Democratic Senator Presses Regulators On Why Big Banks Can’t Be Broken Up (Think Progress)

Who will be paying Hillary?: As the former secretary begins a speaking career, we'll learn a lot from her corporate client roster (Salon)

Jack Lew and the Obama Administration’s Finance-Friendly Status Quo: Meet the new Treasury secretary, same as the old Treasury secretary. Lloyd Green on nominee Jack Lew. (The Daily Beast)

Report to call for Detroit emergency manager - city official (Reuters)

Facebook, The Coolest Cutest Corporate Welfare Queen Of Them All (The Busines Insider)

Supreme Court Appears to Defend Patent on Soybean (The New York Times) Download the True Food Shopper's Guide: How to Avoid Foods Made with Genetically Modified Organisms [GMOs] (The Center for Food Safety)

Danone to cut 900 jobs in ailing Europe (Reuters) Danone to cut 900 jobs in Europe (The Financial 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.

Monday, February 18, 2013

Monday roundup (02-18-13)


ECB's Draghi pushes for European bank bailout fund (The Associated Press)

Eurozone not out of the woods yet: ECB must deal with the banks, output and jobs, or a 'big bazooka' may well be necessary. (The Irish Independent) Celebrating the end of the eurozone affair ignores the heart of the matter: 'We are in the middle of the beginning of the end. The crisis has really hit its peak”, former French economy minister and current IMF chief Christine Lagarde told a broadcaster when asked about the eurozone crisis. The only problem: that was in July 2010. (The Telegraph)

French Cite Recession In Delaying Budget Goal (The New York Times)

The New Spanish Debt Stats Will Give You Chills (The Business Insider) Is Spain’s economic contraction now self-perpetuating? (Credit Writedowns blog)

Berlusconi Win May Prompt Italian ECB Bailout, Mediobanca Says (Bloomberg) Italy Elections Could Derail Economy Further (CNBC)

Only One in Three [Brits] Wants UK to Stay in EU (The Financial Times)

India's rice revolution: In a village in India's poorest state, Bihar, farmers are growing world record amounts of rice – with no GM, and no herbicide. Is this one solution to world food shortages? (The Observer)

G20 currency truce shortlived as Japan mulls foreign bond buys: Japan’s premier has left the door open for outright purchases of foreign bonds to weaken the yen, a move that would risk a serious clash with the US and Europe and a fresh escalation in global currency tensions. (The Telegraph)

[US] Consumers rebound from economic crisis, avoid taking on debt (Bank Credit News) [And yet ...] Walmart Senior VP Asks "Where are All the Customers? And Where’s Their Money?"; "February MTD Sales a Total Disaster" (Mish's Global Economic Trend Analysis blog)

POGO [= The Project on Government Oversight] Sticks It to the SEC (Bill Moyers & Company) Dangerous Liaisons: Revolving Door at SEC Creates Risk of Regulatory Capture (POGO)

Bing, council can't turn Detroit's finances around, state-ordered review finds (The Detroit Free Press)

Reader's Digest parent files for bankruptcy (CNNMoney)

United Technologies plans to cut 3,000 jobs in 2013, filing says (The Republican of Springfield MA)

     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, February 17, 2013

Sunday roundup (02-17-13)


Saxo Bank Says Euro Doomed as Currency Woes Resurface (Bloomberg)

German Recovery Hinges on Euro Zone: Company Investment Will Resume if Bloc Is Stable, Economy Minister Rösler Says, as Cyprus Aid Question Looms (The Wall Street Journal)

Anti-austerity protests on Portugal's streets (EuroNews)



Cyprus votes for new president as euro area country seeks bailout to stave off bankruptcy (The Associated Press) Runoff called in Cyprus' presidential election (The Associated Press) Cypriot conservative chief leads in vote, faces runoff (Reuters)

Welcome to Debt Anonymous: Why America Needs to Act Now: Overspending less is still overspending. The deniers ignore the damage reckless government borrowing is doing to our future. Can Obama finally move to do something about the problem? (The Daily Beast)

Federal worker furloughs could start in April: Government says 2.1 million federal workers could begin facing layoffs as early as April. (CNNMoney)

31 days of higher gas prices comes at tough time (CNNMoney)

Fiscal trouble ahead for most future retirees (The Washington Post)

Before Greed: Americans Didn’t Always Yearn for Riches (The Boston Review) An Embarrassment of Riches: Literature and the Ethics of Wealth in the Gilded Age (The Boston Review) Walden: or, Life in the Woods by Henry David Thoreau (Archive) The Rise of Silas Lapham by William Dean Howells (Archive) Ragged Dick: or, Street Life in New York with the Boot-blacks (Archive) The House of Mirth by Edith Wharton (Archive) Tales of New England (containing "Marsh Rosemary) by Sarah Orne Jewett (Archive)

Fewer bees a threat to world's almond supply (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.

Saturday, February 16, 2013

Saturday roundup (02-16-13)


G-20 seeks to allay fear of currency war: The world leaders gathering in Moscow pledge not to target exchange rates to gain a competitive advantage. (The Los Angeles Times) G-20 Takes Harder Line on Currencies (Bloomberg)

Chart of the Week: High Public Debt Damages Economic Growth (The Heritage Foundation blogs)

Covenant Bank, Chicago, IL, Closed By Regulators [as posted here yesterday] (Problem Bank List)

Unofficial Problem Bank list declines to 812 Institutions (Calculated Risk blog)

Who Owns Seeds? Monsanto Says Not You (CNBC)

     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, February 15, 2013

Friday roundup (02-15-13)


Eurozone Economies Declined in 2012: Italy and Spain had especially sharp declines (Morning Edition from National Public Radio)



[US] Financial Crisis Cost Tops $22 Trillion, GAO Says (The Huffington Post blog)

Senator Elizabeth Warren grills regulators, ending quiet first month in office: In first spotlight turn, Warren rips deals with big banks, scolds for settling civil cases (The Boston Globe) Elizabeth Warren's Aggressive Questioning Prompts Anger From Wall Street (The Huffington Post blog) Elizabeth Warren lashes out at regulators: In her first appearance on the Senate Banking Committee, Sen. Elizabeth Warren grilled regulators for not taking Wall St. banks to trial. (CNNMoney)



Former U.S. bailout cop says another crash is inevitable (CNN blogs)



The United States After the Great Recession: The Challenge of Sustainable Growth (The Brookings Institution)

Wal-Mart Executives Sweat Slow February Start in E-Mails (Bloomberg)

Regulators close down Chicago bank, represents 3rd US bank failure of 2013 (The Associated Press) Covenant Bank of Chicago IL had a troubled assets ratio of 334.7%. (BankTracker)

     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, February 14, 2013

Thursday roundup (02-14-13)


Euro-Area Economy Shrinks Most Since Depths of Recession (Bloomberg) Euro zone economy falls deeper than expected into recession (Reuters) Eurozone dragged further into recession as German economy shrinks: The 17-nation bloc slipped far deeper than expected into recession in the fourth quarter as economic giant Germany suffered its sharpest contraction since the height of the global financial crisis in 2009. (The Telegraph) Eurozone economy deeper in recession (EuroNews)



Child poverty rising in five EU countries [Ireland, Greece, Spain, Portugal and Italy] (The Irish Times) Austerity's children becoming Europe's "lost generation" (Reuters)

Europe Is Not "Fixed": Two Charts (Of Two Minds blog)

The US Federal Reserve bailout of Europe: Who knew? (The Washington Times)

German Economy Contracted More Than Forecast in 4Q (Bloomberg)

France Gives Up Lowering Its Budget Deficit (Time) Which way for Mr Hollande?: Elected on the left, France’s president seems to be veering towards the centre (The Economist)

Italian Economy Shrinks Most in Almost Four Years Before Vote (Bloomberg)

Monte Paschi's former finance chief held in Italy (Reuters)

Portugal's recession worsens, tax hikes set to further weigh on demand (Reuters)

Japanese Economy Shrinks and Remains in Recession (The Associated Press) Japan remains stuck in recession as GDP shrinks 0.1pc: Japan's economy contracted for the third consecutive quarter in October-December, showing the country is struggling to escape from a mild recession and adding weight to the new government's push for radical policy steps to revive growth. (The Telegraph)

Small Businesses [in the United States] Still Struggle, and That’s Impeding a Recovery (The New York Times)

Bullard Says Balance Sheet Growth Raises Fed Exit Concern (Reuters)

Senate panel presses financial regulators on Dodd-Frank progress (Reuters) Regulators Urged to Focus on Dodd-Frank Before Too-Big-to-Fail (Bloomberg)

Eight states join lawsuit challenging Dodd-Frank Lawsuit: System to dismantle a big failing bank is unconstitutional: Attorneys-general from eight states have joined a lawsuit challenging the constitutionality of regulations setting up a system to dismantle a big failing bank. (Marketwatch)

Gangster Bankers: Too Big to Jail: How HSBC hooked up with drug traffickers and terrorists. And got away with it (Rolling Stone)

At Senate Hearing, Warren Comes Out Swinging (The New York Times blogs)

Postal Service Debt Set to Hit $45 Billion (The Fiscal Times)

US Airways Leads AMR Merger to Create Largest Airline (Bloomberg) New American Airlines Means 'Big 4' [American, United, Delta and Southwest] Control US Skies (CNBC)

Central bank gold buying highest since 1964 – World Gold Council (Mining Weekly)

     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, 02-14-13)


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 claims for state jobless aid dropped 27,000 to a seasonally adjusted 341,000, the Labor Department said on Thursday." (Reuters)

Jobless Claims in U.S. Fell More Than Forecast Last Week (Bloomberg)

Jobless claims show sharp improvement, near five-year low (MSNBC blogs)

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.