If you're a true crime fan, click over and read the story.
HT: Russ Dogg.
Asked why he expected the U.S. to break up into separate parts, he said: "A whole range of reasons. Firstly, the financial problems in the U.S. will get worse. Millions of citizens there have lost their savings. Prices and unemployment are on the rise. General Motors and Ford are on the verge of collapse, and this means that whole cities will be left without work. Governors are already insistently demanding money from the federal center. Dissatisfaction is growing, and at the moment it is only being held back by the elections and the hope that Obama can work miracles. But by spring, it will be clear that there are no miracles."
He predicted that the U.S. will break up into six parts - the Pacific coast, with its growing Chinese population; the South, with its Hispanics; Texas, where independence movements are on the rise; the Atlantic coast, with its distinct and separate mentality; five of the poorer central states with their large Native American populations; and the northern states, where the influence from Canada is strong.
Whenever destroyers appear among men, they start by destroying money, for money is men's protection and the base of a moral existence. Destroyers seize gold and leave to its owners a counterfeit pile of paper. This kills all objective standards and delivers men into the arbitrary power of an arbitrary setter of values. Gold was an objective value, an equivalent of wealth produced. Paper is a mortgage on wealth that does not exist, backed by a gun aimed at those who are expected to produce it. Paper is a check drawn by legal looters upon an account which is not theirs: upon the virtue of the victims. Watch for the day when it bounces, marked, 'Account overdrawn.'
My Favorite Things
Triple-A tranches and Screech Dirty Sanchez
Naked Mozilos and Coogee Gelatos
African witch doctors' penis theft rings
These are a few of my favorite things
GM and Chrysler and Ford all in trouble
People homeless from the real estate bubble
CEOs violated by cellmates' big dings
These are a few of my favorite things
VPilfs and X-rays of dildoes in cases,
Leveraged homeowners losing their places,
Drunken Joe Biden of Villages sings,
These are a few of my favourite things.
When windows break, investors jump
When it hits the fan
I simply remember how it used to be
Spank you very much Greenspan
Fannie and Freddie and Barney and Chris Dodd,
Fed'ral receivership gobbles up wall street,
Socialist tendencies pushed from up high,
Vandal invasions, your time is well neigh!
With this bailout,
I just need to cry.
To liquidate assets I'll set what I have.
My favorite things, goodbye.
Jing Hua Wu, the engineer who police say fatally shot three executives at a Santa Clara startup company last week just hours after being fired, spent the last few years amassing a large portfolio of investment properties.
According to public records from eight counties in three states, Wu and his wife own at least 19 homes and vacant lots worth more than $2.4 million. One house in Arkansas, which is now being offered for rent by Wu, is in Hot Springs Village, the largest gated community in the nation. It has a screened porch with a golf course view.
But Wu, after his arrest in the Friday slayings of SiPort's chief executive, its human resources manager and its vice president of operations, told the Santa Clara County public defender's office that he could not afford a private attorney, officials said.
While refusing to discuss details, authorities said they are looking into whether Wu's financial situation had been affected by his foray into real estate before the nation's foreclosure crisis. A review of public records does not make clear how much equity the father of three from Mountain View has in the homes or how much debt he is carrying.
The indictment criticizes Cheney's investment in the Vanguard Group, which holds interests in the private prison companies running the federal detention centers. It accuses Cheney of a conflict of interest and "at least misdemeanor assaults" on detainees by working through the prison companies.
More senior citizens are picking pockets and shoplifting in Japan to cope with cuts in government welfare spending and rising health-care costs in a fast-ageing society.
Criminal offences by people 65 or older doubled to 48,605 in the five years to 2008, the most since police began compiling national statistics in 1978, a Ministry of Justice report said.
Theft is the most common crime of senior citizens, many of whom face declining health, low incomes and a sense of isolation, the report said. Elderly crime may increase in parallel with poverty rates as Japan enters another recession and the budget deficit makes it harder for the government to provide a safety net for people on the fringes of society.
On a mild Thursday morning in late September, Kirk Stephenson, a London investment-fund executive, ate breakfast with his wife and eight-year-old son, then drove to a train station about 30 miles from his Chelsea home.
As an express train approached, Mr. Stephenson stepped onto the tracks, according to British Transport Police. The driver applied emergency brakes but couldn't stop in time. Mr. Stephenson, 47 years old, died at the scene.
What was ailing this man who seemed to have it all? He left no suicide note, so the answer remains a mystery. But many friends and business associates in the U.S., London and his native New Zealand say Mr. Stephenson was a casualty of the global financial crisis, his pressures culminating with the failure of Lehman Brothers Holdings Inc.
What a coincidence. While things that have easily observable market prices (i.e. stocks) went down, everything that is valued subjectively went up! Private equity? It does great during a credit crunch when stocks are crashing! Just ask noted private equity players Blackstone Group or Babcock & Brown. And real estate? Well, whose real estate portfolio is not up at least 8% this year?
Nice numbers, CalPERS! Especially considering your investment in toxic waste CDOs at the beginning of the mortgage crisis, and your $1 billion dollar investment in the now-bankrupt LandSource at the peak of the real estate bubble.
Mark my words: CalPERS is lying about its performance, and there will be serious consequences for California retirees and taxpayers.
The value of residential real estate investments owned by the country's largest public pension fund has plummeted 35% -- a paper loss of $3.3 billion for current workers, retirees and their state and local government employers.
The California Public Employees' Retirement System reported Wednesday that in the year ended June 30 its real estate portfolio declined to $6.08 billion from $9.36 billion, based on 461 independent appraisals of its investments in 288,000 housing units across the country.
In one of the economy's darkest hours in decades, it looks as if people are taking Barack Obama up on his exhortations for hope and change. Seven in 10, or 72 percent, voice confidence the president-elect will make the changes needed to revive the stalling economy, according to an Associated Press-GfK poll released Tuesday. Underscoring how widely the public is counting on its new leader, 44 percent of Republicans joined nearly all Democrats and most independents in expressing that belief.
Officials at the University of Southern California -- responding to an inquiry from the [Wall Street] Journal -- told the company that it had no record that Mr. Lanni had earned a master's degree in business administration from the school.
Mr. Lanni said, "I must stress that this issue has nothing to do with my decision [to resign]."
Nov. 13 (Bloomberg) -- President George W. Bush today urged leaders of the world's biggest economies not to abandon free- market capitalism as they seek an escape from the financial crisis, calling it the ``best system'' for delivering growth.
``History has shown that the greater threat to economic prosperity is not too little government involvement in the market, but too much,'' Bush said. ``Our aim should not be more government, it should be smarter government.''
As I assess where we are today, I believe we have taken the necessary steps to prevent a broad systemic event. Both at home and around the world we have already seen signs of improvement. Our system is stronger and more stable than just a few weeks ago.T-Dub was at the press conference, and took this picture.
I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.
I've got your picture of me and you
You wrote "I love you" I wrote "me too"
I sit there staring and there's nothing else to do
Oh it's in color Your hair is brown
Your eyes are hazel And soft as clouds
I often kiss you when there's no one else around
The communist government of the United States of America is going to bailout many, many mortgages because that’s only fair. [ARTICLE] Of course there are some stipulations attached. For example:
"To qualify, borrowers would have to be at least three months behind on their home loans, and would need to owe 90 percent or more than the home is currently worth."
SO, if you were responsible and were paying off your mortgage, as a good citizen of a non-communist country would do, you might owe less than 90% of the mortgage so you wouldn’t qualify. You also are obviously a loser if you did that because you don’t qualify. Only those who got into financially irresponsible situations qualify, as they should in communist societies.
I mean take heartbreaking stories like this because this unlucky responsible citizen doesn’t get to take advantage of this great new plan:
"Indeed, Tuesday's announcement comes too late for Troy Courtney, a 44-year-old San Francisco police officer.
He moved out of his home in Mill Valley, Calif., at the start of this month -- taking his children, three dogs and one cat with him -- after failing at several to attempts to get a loan modification or a short sale -- where the lender agrees to receive less than the loan is worth.
Courtney worked overtime and tapped into his retirement account to try to catch up with two loans on his home. But in the end he couldn't convince Countrywide Financial, which managed the loan for Wells Fargo, to modify the loan.
"I feel like I missed the boat," he said of the new efforts to help more homeowners. "I'm just mad at the whole system.""
A police officer moved to Mill Valley and obviously for reasons beyond his control, like his inability to read his mortgage contract or budget his income, he lost his house. This poor, poor dear who we can assume got in on an ARM and wasn’t able to sell it or refinance like the realtor promised, deserves more than anyone to keep his house in rich Mill Valley. He symbolizes modern America. He's stupid and stupid bankers took a risk on him stupidly.
Our government represents the extreme rich and manipulates the stupid and the poor. Those in the middle - thanks for providing the financing.
The wide-ranging criminal investigation into wrongdoing at Countrywide - once the nation's largest mortgage originator - now includes serious scrutiny of a loan program that provided special mortgage deals to the well-connected and powerful, including two U.S. senators.
NBC News has learned that Robert Feinberg - a former Countrywide loan officer who handled what were known as the "VIP" mortgages - spent six hours last Thursday with a six-person team from the Justice Department. The team included prosecutors from the Public Integrity section, which handles investigations of possible public corruption.
"The Justice Department is making very serious inquiry into any possible wrongdoing that may involve (former Countrywide CEO) Angelo Mozilo, other Countrywide employees, Sen. Chris Dodd, Sen. Kent Conrad, (former Fannie Mae CEO) Franklin Raines or other public officials," said Feinberg's lawyer, Anthony Salerno. "Robert has always cooperated thoroughly with authorities and is strictly a witness in their investigation."
Barry Fox, a research supervisor who worked for nine years at [Bear Stearns], took a drug overdose and then jumped from his 29th-floor apartment the evening in May after he learned he wouldn't be hired by JP Morgan Chase, which was about to buy his firm. A coroner recently confirmed in an autopsy report that the death was a suicide.
Mr Fox was devastated by the implosion of Bear Stearns and the financial hit he was likely to face, says Fred Philippi, his longtime companion. After several personal setbacks, "this Bear Stearns thing happened to be the last straw that broke his spirit," Mr Philippi said in an interview.
Gov. Arnold Schwarzenegger on Thursday proposed $4.4 billion in new taxes and a similar amount in spending cuts to deal with California's worsening fiscal crisis, saying, "We must stop the bleeding."
Much of the new revenue would come from a 1.5-percentage-point increase in the sales tax [on top of the already highest in the nation 7.25 percent]; the Republican governor described the hike as temporary but did not say how long it would last.
"Many Californians have lost their homes, they've lost their jobs ... and everyone is worried about their future," Schwarzenegger said.
The following is a letter from a friend of this blog.
Its time to kiss and make up. I’ve changed my facebook pic. I’ve weeded my garden of partisanship. I’ve oiled my squeaky political wheel. I’ve parked my 1974 Datsun with the 300-pound bull horn on top. This is a time of togetherness. It is time for those of us that put the “Rat” in Democrat to swig the communal bottle of Jack Daniels with those that put the “Pub” in Republican. The proverbial aisle is a short reach for a handshake. Our differences over taxation, human rights, foreign policy, the right to life, domestic energy, national offense and defense and health care are only ideas. And ideas are what breed conversation. Conversation leads to debate. Debate reveals enlightenment. And enlightenment is the path to enjoying each other for our commonality, while respecting our differences. Differences are natural while division is dangerous.
My humble apologies to any of you that I may have pissed off in the last few months. My comments, questions and declarations certainly embodied the spirit of healthy debate, but I know sometimes those things get personal. Thanks for listening to me. Thanks for your responses and rebuttals. My good friend Charlie McDanger once taught me that as a lifelong learner you want to be open to being persuaded in a discussion. Because if you are persuaded in a discussion, it means that you have just replaced your idea or your viewpoint with another which is better. And if you are not persuaded, you have decided that your own view was the better all along. If we are not persuaded from time to time, we stagnate and restrict our growth. I have grown a great deal over the past several months as the national debate, the community debate and our family debate has shaped my views. Thanks for persuading me and educating me on the subjects that are important to you. I am better off for it.
So let us unite under the star-spangled banner that symbolizes our sisterhood and brotherhood. Let us move forward into the future together. It is a future that is uncertain, yet inevitable. It is a future which requires folks of all creeds, religions and sexualities to caucus in our individual neighborhoods and exercise our American privileges with well-vetted grass roots movements that account for the viewpoints of not only our local communities but the collective interests of the entire world. Historic times, these very well may be. I look forward to making history with all of you…all the Democrats, all the Republicans, all the Independents, all the Greens, all the non-voters, all the other folks, all the Joe 6-Packs, all the Joe the Plumbers, even the USC Trojans and the inimitable Sarah Louise Heath Palin, together.
But I have an uncomfortable feeling that this prosperity isn't something on which we can base our hopes for the future. No nation in history has ever survived a tax burden that reached a third of its national income. Today, 37 cents of every dollar earned in this country is the tax collector's share, and yet our government continues to spend $17 million a day more than the government takes in. We haven't balanced our budget 28 out of the last 34 years. We have raised our debt limit three times in the last twelve months, and now our national debt is one and a half times bigger than all the combined debts of all the nations in the world. We have $15 billion in gold in our treasury--we don't own an ounce. Foreign dollar claims are $27.3 billion, and we have just had announced that the dollar of 1939 will now purchase 45 cents in its total value.
Nixon was no movement conservative, but conservatives were told he was conservative enough and certainly better than that bleeding-heart liberal Hubert Humphrey. Same sales pitch for Nixon’s ’72 re-election campaign against that liberal, anti-war peacenik, George McGovern.
And what did eight years of this “better than the other guy” Republican give us…other than Watergate? A little reminder from Wikipedia…“As President, Nixon imposed wage and price controls, indexed Social Security for inflation, and created Supplemental Security Income (SSI). He also had plans to create a universal minimum income and universal health care, but was not able to realize either. The number of pages added to the Federal Register each year doubled under Nixon. He eradicated the last remnants of the gold standard, created the Environmental Protection Agency (EPA) and Occupational Safety and Health Administration (OSHA), promoted the Legacy of parks program and implemented the Philadelphia Plan, the first significant federal affirmative action program.”
Lovely. But remember, Humphrey and McGovern would have been SO much worse. At least that’s the line conservatives were handed.
The GOP had the opportunity to nominate Ronald Reagan, a true conservative, in 1976, but instead opted for moderate Washington insider and war hero Jerry Ford. In the general election, conservatives and libertarians were again told that while Ford was a moderate, we had to vote for him because Jimmy Carter would be SO much worse.
Which, as it turns out, he was.
In fact, Carter was so bad – Iran hostage crisis, double-digit interest rates, unemployment, malaise, misery index, etc. – that the nation tossed him on his keister in 1980 and elected a true conservative POTUS (President of the United States). As a result of Ronald Reagan’s conservative policies over the next eight years, the nation became stronger and safer and economically healthy. Robust even. Turns out government WAS the problem, not the solution, after all. Go figure.
First, let's look at what will be the main problem facing the new president. George Bush came into office with the country already in recession. Over time the economy recovered, albeit somewhat slowly. As I have demonstrated numerous times, the recovery was fueled by Mortgage Equity Withdrawals. Over 2% and sometimes over 3% of GDP growth in 2002-2006 was the result of rising housing prices, allowing consumers to borrow against their homes and spend on whatever they chose.
I have used the chart below on a lot of occasions, but as it is central to today's letter. Let's review it.
The red bars show how the economy would look without that borrowing power. George Bush would most likely have been a one-term president, as the economy would have been in a serious recession for two years, followed by a very slow recovery of less than a 1% growth in GDP in 2003-04. Unemployment would have been dismally high. The slogan would have been "It's the Economy, Stupid" all over again. That was what beat his father in 1992 and would likely have done it to the son in 2004.
But the nation was in fact growing at over 4%, and 9/11 was not so distant a memory. The focus was on the War on Terror, and Bush won a close election.
But that is not the situation today. The economy is in recession. Over one million jobs have been lost in the last 12 months. The preliminary number came out today for third-quarter GDP and it was down by 0.3%, the first negative quarter since the last recession. As it is the preliminary number, and does not really have much data from September, it is likely that future revisions will see the number be even worse. 1% is not out of the question.
The fourth quarter that we are in will again be negative, and even worse than the third quarter. Bush came in with a recession that started in the waning months of the Clinton administration, and he will leave his successor with a much deeper recession and a consumer that is on the ropes.
Let's review this table from a few weeks ago. To understand the real economic problem facing the new administration, you have to understand this table. These are not normal problems that a likely President Obama will be facing. The above chart stopped at 2006. James Kennedy recently updated the data. Notice below how net MEWs have fallen precipitously in 2008, down 95% from three years ago. On this data alone, GDP should be off by 3% this year. No wonder we are in negative economic territory.
In 2005 there was almost $595 billion in mortgage extractions that went into some kind of consumer spending. Remember, according to the graph above, that translated into a 3% rise in GDP. In 2007, MEWs were down to $470 billion, for a boost of 2% to GDP.
The second quarter of 2008 saw an anemic $9.5 billion. At that run rate, we could see a drop-off of well over 90% from 2005! Now, think what the second quarter would have been without the federal stimulus program of $150 billion. It might have looked and felt like this quarter!
In the economic data which came out today, consumer spending was down 3.1%. You have to go back to the intense and deep recession of 1980 to find a worse number. And we are just in the middle innings of what is likely to become a much worse recession.
So, did American consumers cut back on borrowing? Not if they had a credit card! Total loans from commercial banks to consumers grew by $89 billion for the 12 months ending in September. $61 billion of that was credit card debt, and the amount in recent weeks has exploded. Let's look at this analysis from my favorite slicer and dicer of numbers, data-wizard Greg Weldon (www.weldononline.com). Going with a Halloween theme:
"FAR MORE 'telling' is the LOPSIDED degree to which Credit Card balance growth is 'contributing' to total growth in Consumer Loans, a sign of intensifying 'stress' on consumers, amid accelerating job loss, home price deflation, and equity-market paper wealth devaluation.
"Even the raging Frankenstein stops to note the shockingly UGLY data details:
Commercial Banks, Outstanding Credit Card Balances ... SOARED by an eye-opening + $7.1 billion in the WEEK ending October 15th, representing a +1.9% single-week rate of expansion ... or ... nearly ONE-HUNDRED PERCENT annualized (+98.4%).
"Even more 'telling' is the 'read' acquired by contemplating the following pair of data FACTS:
* Credit Card Loans, 10 months Sep07-thru-Jul-08 ... up + $29.1 billion
* Credit Card Loans, 10 weeks Aug-08-to-mid-Oct-08 ... up + $32.3 billion
"In other words, Commercial Bank 'exposure' via the total amount of Credit Card 'loans' outstanding has risen MORE in the last ten WEEKS, than it did in the previous ten MONTHS COMBINED !!!
"Moreover, the growth in the last ten-weeks, $32.3 billion, or about $600 million per 'shopping day' since the beginning of August ... represents nominal growth of + 9.3% ... or ... + 48.3% annualized over the last ten weeks.
"According to American Express, delinquencies on credit payments rose to 4.1% of all credit outstanding in the 3Q, up from 2.5% in 3Q of 2007, with Bank of America's rate rising even more steeply, to 5.9% in the quarter.
"Moreover, the 'pool' of loans deemed 'uncollectable' rose to a high 6.7% in the 3Q, soaring from 3.6% last September."