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Friday, December 28, 2012

Fiscal Cliff Q&A: 25wds or less

Its Friday--  the end of the week; the last week of 2012..

The last posting (in all likelihood) for the calendar year...

The "Grasshoppers" are taking their winter vacations with their families; their minds a million miles away from anything meaningful...  Just Fa La La'ing

The "Ants" are also enjoying holiday festivities but also taking the time to check back here and other sites to keep informed on the news of the day..

So to the 'Ants', we dedicate today's posting...

Simple really: a quick Q&A on the Fiscal Cliff 'crisis' with each answer kept purposely to 25 words of less for brevity and to make for a quick weekend read while keeping you up to date...
Q: Will the 'Fiscal Cliff' be averted before January 1st?

A:  Don't bet on it... Anything possible but..  really, don't wager on it.

Q:  What does it mean if no agreement is in place?

A:  Means nothing really..  Any agreement can still made in say mid to late January and then backdated to Jan 1st.

Q:  So that 'deadline' of Jan 1st really was meaningless?

A:  Yes.  There are no sincere 'lines in the sand' where government is concerned.  Its all arbitrary.
Q: What is the Democrats' strategy for playing hardball?

A:  They feel they have political currency i.e. Obama's election-- no motivation to really make drastic compromises; in a way they're 100% correct

Q:  What is the Republicans' strategy for playing hardball?

A: Fear tea party candidates will defeat them in 2014 primaries. Also, they prefer new Congress deal with this; they possess more votes than now

Q:  Why are Republicans so inflexible about tax increases on wealthy?

A:  They honestly (wrongly) believe national wealth and prosperity Only occurs when they possess it in abundance and they trickle it down
Q:  Why does the media hype this non-event?

A:  It is what media does.  Plus it is corporate.  Corporations & wealthy don't want higher taxes.  Neither does Wall Street or Investors.

Q:  Certainly the Republicans know they will have to concede their fight for Bush tax cuts for all as part of an overall agreement, don;t they?

A:  Not necessarily.  Many Tea Party-ites would rather taxes dramatically go up based on no agreement then to make compromises at bargaining table.

Q: Why?

A: 1) The goal is winning midterms while blaming Obama for the supposed new recession; 2) They hate him personally & won't give an inch.
Q:  So what will this do to the overall economy?

A: Not much.  We've been in continual recession since 2007 so little change will be felt by masses.      Stocks will go down, then up, then down...

Q: Repeating from earlier, if what you say is true, why is the media making such a to-do about this situation of going over the 'cliff'?

A: Because taxes on affluent will go up; stock dividends tax rate-- Up... They don't represent mainstream values or economic priorities; They are stock market cheerleaders.

Q: Why does 'A&G' want the nation to drop off the proverbial 'cliff'?

A: After Fifty months of "winning", it is about time Wall Street, Investors and very affluent suffer in some way like the bottom 99% has.  No more catering...
Q:  In conclusion, what's the most important thing people should be taking out of this situation, if anything?

A:  We're all being manipulated; its a show; political posturing.  Reps & Dems... Congress & President-- all buddies and friends; Deal will ultimately be done.

~ We will return on Wed. January 2nd unless there is something relevant or important to write about..   So until then, Happy New Year to All!

Thursday, December 27, 2012

Speaking Frank on Holiday Sales

Its' early Thursday morning.. we're back..  We hope everyone had a lovely Christmas holiday..  And now let's peruse the news...

More fiscal cliff nonsense... Will they?  Won't they?


Some articles on how overall holiday sales have been the worst since the 2008 crisis...  Gotta admit we're a little surprised it was admitted publicly... this is usually the type of news that has a positive twist or which you don't hear about until mid January at earliest..

Gee, we wonder why sales have been so poor?

Hurricane Sandy?   No..  It was terrible and it hit some communities unmercilessly but it was also two full months ago.. so that's a 'No'

Black Friday starting on Thanksgiving evening?   No  It was a poor idea and utterly inconsiderate to anyone who worked for those stores but that really didn't affect overall shopping numbers because statistics compiled based on overall sales and credit card usage isn't based on December alone-- it took Thanksgiving into account..  and Halloween too.
"Holiday-related sales rose 0.7 percent from Oct. 28 through Dec. 24, as compared to last year, according to data from Mastercard Advisors SpendingPulse. That was the lowest growth rate for that period since 2008, at the depths of the recession. " (NBC News)

And why does Wall St care?  It wants everyone spending as much as humanly possible to pump up the quarterly dividends of companies they're actively invested in, which translates to greater profit for them.

So why were sales so low?   People tapped out of cash?  People finally feeling the economic effects of long-term unemployment?  Fear of that pretend 'cliff'?

Possibly...  Maybe... and Doubt it....

We think it was very simple-- the sales were utter crap and people finally caught on to the tricks.

Back in 2008 after the market crashed and such, people were fearful to shop.. Didn't feel comfortable for the future and such really didn't shop in droves.  The department stores and other major retailers were desperate to get rid of inventory so you the consumer saw some genuinely good sales across the board--clothing to electronics to automobiles...
In 2009, these merchants were pissed off and determined to never let their profits be cut into this dramatically again... They had to re-condition the consumer to not expect or look for the sale...

So they drastically cut back quantities especially on higher-end ticket items.  'You want to buy X?  We'll we only have 2 in stock in this color/size so when its gone, its gone'...  and people got "played" by the merchants and basically gobbled this manipulation up..

In addition, at lower end stores, no longer were they going to wait until the 26th to mark merchandise 50% off... They were going to create phony faux sales... 40-50% off sales in early November.. and Black Friday.. and all of December..   just recycle the sales...  Macy's is pro at this...

What do we mean?  Example.. a black sweater retails at $140 so Macys will have a sale --40% off then add some "special" coupons to lower the price to say $65...   This "sale" will be offered on Halloween.. Veterans Day.. pre-Thanksgiving, Black Friday, early-mid December, etc... you get the picture...

So for every 14 days that sweater is available for purchase, perhaps 8 to 10 of them will be "sales"... the exact Same sale... And Only after these 8-10 pretend sales do not move the merchandise, will a store like Macy's perhaps add an extra 10% off
Then you had stores like Kohl's that issue 20% coupons literally every single day in one's email box which add up to 52 "sales" a year...  Trust us.. if you're eternally getting 20% off, that item is eternally inflated by 20%

And so between 2009 -2011, people bought into all this nonsense... And suddenly whether it be people running out of disposable income, feeling depressed by the state of things or just tired of the same bullshit tricks and games, overall people cut back on their spending and decided to wait for "real" sales...

Whether they get them in late December or January.. who knows..  retail stores can be stubborn bastards..  For instance one of our staff visited Target the day after Christmas.. it seems the wrapping paper and bows, etc were 50% off but the holiday candy was only 33% off...

Target stingily wanted to hold on to that 17% price differential as long as possible...  Certainly many people bought holiday chocolates at that discounted price making Target look smart... but then again the store was visited in late afternoon and was told there was "A LOT" of chocolate left considering most other holiday fare at 50% were completely gone.
Not to pick on Target but it made us think... last year on Black Friday, they sold iTunes cards at 20% off which is overall a good sale.  This Black Friday, they sold iTunes 4-packs normally $60 for $50 which works to a discount of 16.7% off.

Miserliness can be a subtle thing.

Holiday sales overall tend to be fake.  For instance, for all the hype and hoopla about "fantastic" Black Friday and Christmas sales on HDTVs, do you know when the best sales of the year Really take place??

Yes-- the week or two right before the Super Bowl.
Do you know when the best prices for laptops and non-Apple tables are offered?  Hint.. its not Black Friday or Christmas...

Yes-- Its the couple weeks in mid-late August before kids go back to school.

Any pay full price for calendars on Dec 24th when they'll be 33-50% off on Dec 25th and 75% off by January 21st?

We hope that stores will learn some lessons and next year offer better and more sincere savings & value to customers or make Black Friday something worthy to stand outside in the cold for...

But we doubt it...

Monday, December 24, 2012

Christmastime Facts N Tidbits

The entire 'Ants & Grasshoppers' team wishes a Merry Christmas to all our loyal readers & followers...

We will return either Wednesday 12/26 or Thurs 12/27 depending on if anything newsworthy occurs immediately after the holiday...

Below is a repost from Christmas 2010 full of interesting facts & tidbits about the holiday... Hope you all enjoy & see you very soon...

~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~
The tradition of burning a Yule log actually has its roots in ancient Scandinavia. Supposedly the Yule log was a source of good luck and its remnants were saved to inspire good fortune throughout the year. It was such a widely held belief that people even threw the ashes in wells to make the water safer to drink.

The annual Christmas pudding was more than just a tasty treat. Small items were placed in them which had the power to predict what the New Year would bring. Coins were associated with a gain in wealth, a ring was a sign of an imminent marriage and a button signified extended bachelorhood.

This idea actually goes back to the middle ages where the cake being served on the Twelfth Night would come complete with a hidden bean. Whoever found this bean was declared “king” for that one night.

If you counted all the gifts that were given in the song “Twelve Days of Christmas” you would realize that the number of gifts being presented were 364 in total, thus a gift was given for each day of the year.

Christmas was illegal in England from 1647-1660. This was enforced by the then leader Oliver Cromwell who believed it was immoral to hold celebrations on one of the holiest days of the year. The celebration of Christmas was therefore a criminal offence which could lead to an individual being arrested if he or she was found guilty of condoning any revelry during the period.

The first President to decorate a Christmas tree was Franklin Pierce- 1856.

The evergreen tree, because it is perpetually green, has been used as a symbol of eternal life since the ancient Egyptians and Hebrews.  The Scandinavians believed that the evergreen could even scare away the devil.  Decorating an evergreen tree in honor of Xmas became popular in the Middle Ages, especially in Germany.  The decorations then consisted of candles and wafers, to symbolize Christ and the Host.

Martin Luther is actually said to be the first person to put candles on a tree.  (The decorated wooden Xmas pyramid was also popular then!) The tree became popular in Europe and America in the 18th century and the Victorians started decorating them with candies and cakes hung with ribbon.

Woolworth (a department store) began selling manufactured Xmas ornaments in 1880 and the custom became big very fast.  The first electronically lighted Xmas tree appeared in 1882.

Rudolph" was actually created by Montgomery Ward in the late 1930's for a holiday promotion
Silent Night was written in 1818, by an Austrian priest Joseph Mohr. He was told the day before Christmas that the church organ was broken and would not be prepared in time for Christmas Eve.

He was saddened by this and could not think of Christmas without music, so he wanted to write a carol that could be sung by choir to guitar music. He sat down and wrote three stanzas. Later that night the people in the little Austrian Church sang "Stille Nacht" for the first time.

Christmas is sometimes referred to as X-Mas because the Greek letter "x" is the first letter of the Greek word for Christ, Xristos. "Xmas" therefore means "Christ's Mass." The abbreviation has been around since at least the sixteenth century and is not, as some people have claimed, an attempt to take the "Christ" out of "Christmas" and make it a secular holiday.
In the midst of World War I, At midnight on Christmas Eve 1914 firing from the German trenches suddenly stopped. A German brass band began playing Christmas carols. Early, Christmas morning, the German soldiers came out of their trenches, approaching the allied lines, calling "Merry Christmas".

At first the allied soldiers thought it was a trick, but they soon climbed out of their trenches and shook hands with the German soldiers. The truce lasted a few days, and the men exchanged presents of cigarettes and plum puddings, sang carols and songs. They even played a game of Soccer.

Many Christmas customs are carryovers from pre-Christian celebrations. Hanging gifts on trees is supposed to stem from tree worship of the Druids, and the belief that the tree was the giver of all good things. The Druids are also partly responsible for the use of mistletoe at Christmastime.

They regarded the mistletoe as sacred, made certain that it never touched the ground, and dedicated it to the Goddess of Love, which explains the kissing that goes on under it. Originally, when a boy kissed a girl, he plucked a berry from the cluster and presented it to her. When the berries were gone, so were the kisses.
A wreath with holly, red berries and other decorations began from at least the 17th century. Holly, with its sharply pointed leaves, symbolized the thorns in Christ's crown-of-thorns. Red berries symbolised the drops of Christ's blood. A wreath at Christmas signified a home that celebrated to birth of Christ.

Hanging the Christmas stocking on the hearth on Christmas Eve in the hope that it will be filled with presents the next morning is a custom that goes back about 400 years. It derived from the custom in Holland of children placing wooden shoes next to the hearth the night before the arrival of St. Nicholas.

 The children would fill their shoes with straw and food for St Nicholas's for the donkey that carried the gifts. In exchange he would leave them a small gift such as small cakes, fruits and other gifts.

Friday, December 21, 2012

Stock Market Like Music Instruments: 'Played'

Many people have expressed over the years, especially in recent times that the market is 'played' or rigged..  And to defend their point of view, they express as Example #1 the Fed's direct interference via the continual injection of tens of billions of dollars monthly...

These people are correct of course...

But if the rigging of the market was limited to issues of liquidity or algorhytmic trading, that would be bad enough..

It seems that the stock market has in addition, the ability to purposely and intentionally plummet at the whim and will of the financial elite.

Normally that would be absurd to believe, but as the reaction to the initial 2008 failed TARP vote and subsequent drop of 1550 pts in 2 days showed, it is quite doable.
As most may or may not know, Republican John Boehner, Majority leader of the House, tried to push forth a horrible 'Plan B' to supposedly solve the 'fiscal cliff' crisis, which narrowly passed the House but was dead on arrival for Senate approval, much less the President and Boehner himself realized he didn't even have enough votes in his own party to gain support..

Pretty embarrassing.

So now what has been the popular discussion at the financial 'water cooler'..

Something akin to 'maybe what we all need to scare these politicians into shape is a dramatic stock market drop like in 2008'

If that was simply empty wishful thinking, we wouldn't care..

But once again we refer back to 2008.
And Investors & money managers definitely reflect positive upon that event because it allowed them and friends/colleagues to receive $700 bn in taxpayer money without any questions as to where it was going or demands of repayment.

The one difference between then and now which may come into play, is back then Treasury Secretary under George W Bush and former Goldman Sachs head Hank Paulson desperately wanted that $700 Bn to be passed so clearly he manipulated things from behind the scenes after the initial failed vote to get such a co-ordinated and controlled market drop.

Currently those who want the market to collapse to scare Washington into a deal are on the outside.. Their 'guy' is neither the President or Treasury Secretary.   Certainly Tim Geithner has plenty of buddies on Wall St but it is not in Obama's interests to sabotage the stock market to force concessions, so that gives hope that the ploy will not be re-orchestrated.

Oh the markets may drop by many points if/once the reality of no cliff deal becomes apparent.  But it will be choppy... disorganized.. and the greed of Investors will trump any desire for unity to make a point..
In other words, without a 'united front', any dramatic drop in stocks will stimulate the mongrels to snap up the discounts which will push the market up and thus no sincere creation of public panic.

But it makes it very clear how dangerous it is for everyday people to place their money in the stock market, even with Bernanke keeping interest rates at near zero till 2015 at least and little other avenues to get a return on investment comparable to inflation.

A very quick word on interest rates..  The Fed can never raise them... Ever...  for every percentage point raised, it would cost the US govt and additional $250 billion in interest alone on their foreign debts.   So don't ever expect to see a return to the good ole' days of 4-5% interest on savings at the bank.

So that's where things stand this Friday, December 21st...

Congress has gone on vacation till after Christmas so let's all do so as well..  put all this in the back of your minds for a few days at least and enjoy this lovely holiday.

Thursday, December 20, 2012

Plan B from Outer Space

Many apologies to those offended by the following statement:

Republican lawmakers are Scum!

Putrid, dirty, filthy, detestable, carcass-ridden scum...

Now we're not saying all Republicans are..  Just the lawmakers.

 "The U.S. House of Representatives on Thursday narrowly passed a bill to cut domestic spending while protecting defense programs from a similar fate next year.

The measure, which Republicans said they crafted as a back-up plan in case broader "fiscal cliff" negotiations with President Barack Obama fail, will die in the Senate, according to Senate Majority Leader Harry Reid, a Democrat.

The bill passed 215 to 209.
The bill was one of two bills the House was set to vote on, which are being referred to as "Plan B" to averting the fiscal cliff."  (AP)

Now like the article states, it will not pass... even if it ever gets through the Senate which it won't, the President will veto it... So that's that..

So what makes the Republican lawmakers scum?

Is it as the first paragraph stated, that their gold is to cut domestic spending (to the bone if the could) while protecting the Defense budget?

Well, sure..

But there's more to it than that...
'Plan B' Would Actually Raise Taxes on the Poor  (CNBC)

Would it now...

"The non-partisan Tax Policy Center found that the average taxpayer earning $1 million or more in cash income would see their taxes go up by an average of $72,000. A small number of those million-plus earners will see a tax cut, due to an anomaly in the Alternative Minimum Tax.

But lower income earners will also see a tax hike. People making between $10,000 to $20,000 will see their taxes go up by an average of $262. People making $20,000 to $30,000 will see their taxes go up by $219."

What Nerve!  What Arrogant Gall!
~ "I vant to suckk poor-people's blood!"

OK.. let's stop there a moment to review...

According to Plan B, some multi-millionaires would pay LESS taxes, and those making $30k or less would pay More, with those making under $20k forced to pay MORE than those just above it..."

Are they Serious?!

Obviously the Republican legislative scum are...

Let's continue...
"Granted, those are minor increases. But drilling down deeper, you find that some of those low-income earners could see a sizable increase. One in five of Americans who earn less than $20,000 a year will see an increase of $1,070 -- a sizeable amount for low-income earners."

In fact, the only taxpayers who will get an overall tax cut under Plan B are those who earn between $200,000 and $1 million. People making between $200,000 and $500,000 will see an average tax cut of $301. Those making between $500,000 and $1 million will see their taxes go down by $164."

It really is infuriating..   Certainly it could be worse-- just imagine if the Evil Republicans controlled both houses and the Presidency!  But the sheer audacity of floating a plan that makes those with the least amount of money pay higher rates while lowering the wealthy... all under a bullshit guise of pushing economic prosperity..

Some people in Washington are rotten to the core...
We thought this statement in the CNBC article at the end was just pathetic..

"This is not to say that Plan B is good or bad."

NO?   You couldn't say?  That difficult to choose, ehh?

Once again, we hope and wish and pray and whatever else needs to happen for a fiscal cliff compromise to NOT be agreed to and that from it, Wall St howls...

And this Republican lawmaker deviance just begs a simple question:

Do they ever hope or wish to win the White House in the future... Ever??

The Needed Smackdown

* If you picture "Wall St" at the receiving end of the wrestling photos in today's blog, you'll enjoy them much better...

None of us here at A&G are really fans of professional wrestling but there's a term that is used in its marketing title which applies so well to what those on Wall Street deserve.

A "Smackdown"!

A very hard, deep-penetrating, intense Smackdown to shake off all the arrogance and hubris; this firmly entrenched notion that they are Superior and only their needs and wants are to be satisfied; where all political decisions must be for their benefit primarily..

And why?

Because 'we're 'Wall Street" my dear boy (or girl)... that's why'...

'And we can crash the stock market any time we wish...'
That was the tone of the intro piece to a 'Daily Ticker' video on the Yahoo Financial news site...  specifically it went something like this (in blue font)...

"Both sides have given up ground in the "Fiscal Cliff" negotiations in Washington, but the surprise tactic of the Republicans to put forth a "Plan B" has suddenly thrown the whole deal into doubt.

Republican House Speaker John Boehner essentially stormed out of the negotiations a couple of days ago and put forth his own bill, which he refers to as "Plan B." This bill extends the Bush tax cuts for all Americans except those making $1 million or more.

Greg Valliere, the Chief Political Strategist at Potomac Research Group, says the Republican ploy is the "worst case scenario" for the negotiations.

Valliere now thinks it is likely that the "deal" will slip into next year and may not happen as early in January as many people expect.

So, what would finally galvanize Washington lawmakers and get them to do what American citizens elected them to do?

A stock market crash.
If Wall Street finally begins to believe that this isn't just kabuki theater--that our leaders really are incompetent and might drive the country off the cliff--the stock market might drop in anticipation of a coming recession... (this) might suddenly wake up the politicians, who would then begin to worry about getting fired because of the crappy economy."

So in case you missed it, the video's introduction stated an opinion by a guest which was used as a 'teaser' that if Wall Street can not get the two sides to work together (to ensure Wall St pays less taxes than it would without an agreement), that is not only a perfectly sound idea to purposely and intentionally sabotage the stock market, but really a necessity.

Pretty scary if it could happen even in mere theory..

Even 'poop one's britches' scarier that it HAS happened before..

This was done specifically in late 2008 when the original TARP failed even though all those corrupt bankers and their bought-and-paid-for political lackies were crying "The world is going to end!" because the sensible ones dared to actually want time to study the 1,000+ page bill first...
We're sure the politicians did feel that way especially since the vast majority were/are multi-millionaires who at the time we're allowed legally to insider-trading info which influenced their investment choices for many years/decades..

So former Treasury Secretary under George W Bush, the super-corrupt former Goldman Sachs CEO Henry Paulson orchestrated behind the scenes for the market to drop around 2,000 points in a span of 4-trading days and magically.. and we do mean Immediately after, the bill was passed..

And within 8 trading days, Wall St recovered those 2,000 pts..

$700 to the Banks with no oversight as to who got what and how repayment was to commence.  They goal then was to give to All banks even if they didn't need the money so you dear people were not to know which banks were in dire straits (and you'd pull your money) and which weren't...

And so this piece of shit... this nobody-nothing Greg Valliere, the Chief Political Strategist at Potomac Research Group is openly advocating the same...

Find a consensus that appeases Wall Street or we'll force you to..
And how that is different than say a spoiled child demanding the biggest slice of the cake or he/she will push it off the table and smush with his/her feet, we really don't see..

Wall Street desperately needs a Smackdown in the worst way... 50+ months of being coddled and protected and insulated from the global economic realities...among them that we are still in recession!   It didn't 'stop'..  its been one continual long slog...

So when the pundits say 'recession if no cliff deal..' they are Liars.. simple.

If you must compile tens of thousands of dollars of student loan debt before you're old enough to step inside a casino so that eventually you work for Staples or such place, then no, there isn't a recovery...

If men and women over the age of 65.. some at 70 still Have to work not because they wish to but out of dire necessity because their savings interest rate has been cut to 1/100th of a percent which by extension ends up blocking the upward mobility of the younger generations, then no, there isn't a recovery...
 If the unemployment rate drops Only because millions upon millions of people have given up looking for work out of frustration and despondency and their only means of survival is a government check, then no, there isn't a recovery...

And Wall Street is to blame...

They.. the financial sector... they screamed and 'squeaked' hard for their wheel to get the grease and once applied, they never let go of the can... simply hid it for the future.. their future..

We hope this nation goes off the so-called 'cliff' and if so, we look forward to hearing the beautiful sounds of thousands of Investors, traders and financiers openly Hiss-Seething...


Wednesday, December 19, 2012

Amused musings

Yesterday we did not post anything new.. Sorry about that.

Unlike mainstream news, we don't write on non-news and non-events and treat them like they are worth concerning oneself over..

And how can we summarize the last two days?

More fiscal cliff irrelevance..  This person conceded this.. and that person conceded that and the market went up over 100 pts based on 'optimism' that a deal could be averted...

A deal that to put as bluntly as humanly possible, would allow those in the financial sector to avoid paying a dramatically heavier tax burden, especially on stock dividends.

So when the market is happy, it means they believe they'll pay less, which means you and we will be making up the difference in increased tax revenue and government cuts.
If the market drops, it means the filth and muck will have their profits cut into more than they like... which is good for health and vitality of the nation.

Most people in the media will say something like 'There is now 12 days to avert a fiscal cliff'...   Honestly, we say '12 days left to hope neither party can come to a working agreement that Congress will pass and President will sign'

Did you know it has been a little over 50 months since Lehman Bros. collapsed?

Did you know with the exception of a mini panic which lasted maybe a week or so, the financial sector and the truly affluent have not had to suffer one iota in the last 50 months?

Any financial losses from the crash have been made up by the affluent, and every corrupt or inept industry from banking to housing to automobiles have been bailed out.. No financial elite bigwig has been arrested..
So who's really suffered in the last 50 months?

Oh well, maybe you the reader but respectfully stated, you don't really matter to the government.  Never did... never will..  And no policy or piece of legislation is ever going to be enacted to benefit you nor we unless 'They' benefit too..

And you should see all the articles written on this topic in financial newspapers, etc..  'How to play the fiscal cliff'.. 'How to profit from the deadlock'.. '   Like it was a game..

But in a sense it is...

Its like all the nonsense every couple years over the fear of raising the debt ceiling.  And the whore media will print every lie that government and the finance sector tells them... about doom and catastrophe if something isn't agreed upon by X date...
And no one really talks about how the Treasury secretary in this situation still has an additional 6 months of leeway if an agreement is not met, to pay on the debt by taking from other sources and then once its agreed, the money is back-dated so there's no real effects on government's operations.

Thus the deadline is an arbitrary one...

Like this one..

All this talk about a deal that must get done by 12/31/12...  (cue dramatic music) Da Da Dummm!  Then next week, the post Christmas clatter-chatter will be how the goal is to simply have a working framework of a deal, thus making the deadline moot...

The beauty of government-- unlike the real world, deadlines and 'lines in the sand' can be shape-shifted as free and haphazard as if it was the wind wisping up the granules.
And unlike the real world, politicians do not have to keep their promises ever..

A President who promised no changes or alterations to Social Security, can simply concede to the Enemy at a drop of a hat to freeze cost of living increases in the future for those receiving it..  Ehh.. what is a measly increase of 1.6% a year in benefits when one is not in a position to receive or live off them?

The modern Marie Antoinetteism: 'Let em' drink Ensure'

And a Congressional leader can betray every core principle of his political party (even if we dislike what that core represents) by conceding tax increase after tax increase...

All to appear to seem like they are working for the people to get things done, when the vast majority of people are concerned with preparing to celebrate the Christmas season with loved ones.
Political egotism doesn't really require an audience anyways..

Only a mirror.

Lesson of the story: Don't get worked up on 'fiscal cliff'.. Don't even think on it... Enjoy this Christmas season and allow the children in Washington to play their games in peace

And now everyone's caught up this fine, festive Wednesday...

Monday, December 17, 2012

Moving closer back to the Wampum economy

~ A Wampum Bracelet

Wampum:  Small cylindrical beads made from polished shells and fashioned into strings or belts, formerly used by certain Native American peoples as currency and jewelry or for ceremonial exchanges between groups; Informal money

Ever notice how all the sneaky stuff always comes on a Friday afternoon?

Like that notice in the mail that your insurance (auto, health,etc) is going up, or your local Doctor's office letting you know they're concerned with the latest blood work results..

Friday is also the most popular day of the work week to fire people... usually around 4p-- gives just enough time for a worker-bee to collect all his/her miscellaneous personables (including some extra pens and if lucky a stapler out of spite) before everyone leaves the office in masse; a nice way for a manager to tidy up loose ends before the weekend..

Its also a day when articles about the True state of our domestic and global economy are written because its often when editors are most lax and not as jumpy about how markets will react.
We found this very informative article via CNBC which was written this past Friday just after markets closed...  Explains in a concise way how beholden we all are to central banks and how the figures spent are so mind-boggling that if those Evil entities ever crashed, there could not possibly be a backstop...

Here's some main points (original article in blue font)

"It's a central bankers' world, and we're all just living in it.

Entities such as the Federal Reserve and the European Central Bank in 2012 took control of global economies like never before. Based on current market and economic behavior it's likely to be years before anything changes.

After all, how can central banks take their foot off the stimulus pedal when there's so much at stake?

In all, 13 other central banks in the world have followed the Fed's lead and set interest rates at or near zero in an effort to keep the liquidity spigots open and prop up their ailing economies. Those 14 economies represent a staggering $65 trillion in combined equity and bond market capitalizations, according to Bank of America Merrill Lynch.
As for the bond-buying programs -- aka quantitative easing -- that dovetail with the low interest rates, the U.S. central bank alone shortly will eclipse $3 trillion on its balance sheet and is expected to end 2013 north of $4 trillion in electronically created money. 

Globally, that figure is, well, a lot.

"When you add up all the central banks in the world, it's going to be over $9 trillion," said Marc Doss, regional chief investment officer for Wells Fargo Private Bank. "That's like creating the second-largest economy in the world out of thin air... We're in open-ended QE across the globe. I don't know what the end game is."

So what to take from that?

1)  The last sentence is quite scary--  open ended QE with no endgame... We keep repeating ourselves but its important people understand-- central banks create money out of thin air which both is created as new government debt to be paid by the public, and it devalues i.e. weakens the currency.
The faster is does, the quicker to hyperinflation you get.   If you don't know what that means, picture pre-Nazi Germany of the Weimar Republic where literal wheelbarrows of worthless money-paper were needed to buy milk, bread and cheese.

2)  It makes all this fiscal cliff debate such utter nonsense-- two parties fighting over mere percentage points.  If a person making 1 million dollars pays 47% taxes vs 45%, its a difference of a mere $20,000 which while to many seems a lot, in the greater maelstrom of Fed-created debt, are mere raindrops in a pond.

In Greece, things are so bad (because they were too Cowardly to default) that now a person making 55k euros is expected to pay 45% in taxes.   Wonder how that would go along here?   Its not going along well there either which is why they're always striking and rioting; something the US media rarely if ever shows on TV unless to play upon the visually sensationalist elements.

Every citizen of every nation pays for its governments' sins i.e. debts.. Unfortunately we're no different.
3)  Even if we had a President in office who Hated the Fed with every breath in his/her being, that person is virtually powerless to stop that Evil Fed Chair (whoever it may be) and the small body of appointed rats who vote for QE 1 to infinity.  

The Fed was created to be independent of government control-- outside of the President appointing someone as a nominee from a pre-selected list every four years and those meaningless monthly visits where the Fed Chair says nothing relevant to Congress,  the Fed does as it wishes and with the sole goal of benefiting banks.

That's who Bernanke works for- not the government or the people's interest..

4)  Personally, we hate doing those gigantic math demonstrations that's supposed to widen your eyes and go 'Wow!' but on this occasion we shall.
There is 'a staggering $65 trillion in combined equity and bond market capitalizations' which is a complex way of saying total outstanding debt...   And there's 7 billion people living at this moment

$65,000,000,000,000  divided by 7,000,000,000 = $9,285

$9,285 is how much each man, woman, child and infant mathematically carries with them in global debt that will have to be ultimately repaid.. Now it may take many centuries.. many millennium to do so..  But, it will all need to be repaid by someone.. or we'll literally be forced to go back to localized trading and commerce..

The wampum economy.