"We're all worried about losing our jobs," Rep. Paul Ryan, a Republican, declared in an impassioned speech in support of the bill before the vote. "Most of us say, 'I want this thing to pass, but I want you to vote for it - not me.' "
There are times when I just can do no more than wonder at how some people's heads work.
Don't worry, TF, we have this kind in NZ as well.
OK, so the premise is -
Pay $2,000 fine.
Pay three years taxes.
Collect free citizenship card.
______________________________
I think that if I were this jolly roger's political representative I might reply in the following terms...
_____________________________
First, Mr Ruppert, you might like to refund to your employer the difference between what you actually earned in the past 5 years as a presumably legal US citizen, and what might be paid to an illegal immigrant.
Right, got that?
Now sell your home, donate the proceeds to charity (along with any tax credits that might be due), and live in low income rental housing for the two years that you want tax free.
Still feeling keen?
Now remember that for the past five years you have been an illegal. You know the stress that you feel when you see that policeman shake his finger at you for exceeding the speed limit? Live like that for the whole 5 years, 24/7, the next police is going to stop you with intent and ask for your cards...
Finally, bear in mind that you could, in that 5 years, be one of the 5% that are caught and deported (in NZ it is closer to 50%). Like in snakes and ladders or monopoly - return to go, do not collect anything, and miss your next 5 turns...
Still want to join in?
Yours truly...
we are seeing what happens when the economy is run by snake-oil medicine men and itinerant side-show freaks.
Forty years ago there were almost no investment banks, securitised debt or derivatives. The huge increase in global liquidity and credit since the early 1980s has been almost exclusively driven by investment banks through the creation of securitised debt and derivatives, which now represent nearly 90 per cent of total liquidity.
At the beginning of the year there were five major US investment banks - Goldman Sachs, with assets of US$1061 billion (or US$1.06 trillion), Morgan Stanley US$1045 billion, Merrill Lynch US$1020 billion, Lehman Brothers US$689 billion and Bear Stearns US$424 billion.
Bear Stearns and Lehman Brothers have disappeared and Merrill Lynch is being taken over by Bank of America. These companies created a huge amount of toxic securitised debt and derivatives that have plunged in value.
The conversion of the two remaining investment banks, Goldman Sachs and Morgan Stanley, into bank holding companies is significant for a number of reasons:
* As commercial banks they will be subject to regulation whereas they were almost totally unregulated as investment banks
* Their lending capabilities will be severely restricted because commercial banks have strict capital adequacy requirements. Morgan Stanley's debt to equity ratio is 30:1 and Goldman Sachs 22:1 whereas banks are generally restricted to no more than 15:1.
The Government measures bank failures by an institution's assets; Seattle-based WaMu has roughly US$310 billion in assets.
The previous record was the failure of Continental Illinois National Bank in 1984, with US$40 billion in assets when it closed. IndyMac, seized in July, had US$32 billion.
WaMu was searching for a lifeline after piling up billions of dollars in losses because of failed mortgages. WaMu has seen its stock price plummet by 87 per cent this year, and it suffered a ratings downgrade by Standard & Poor's earlier this week that put it in danger of collapse.
The Bush Administration's proposal for a US$700 billion bailout for distressed financial institutions was believed to have given fresh impetus to a buyout and new allure to Washington Mutual. Besides JPMorgan Chase, Wells Fargo, Citigroup, HSBC, Spain's Banco Santander and Toronto-Dominion Bank of Canada were all mentioned as possible suitors. WaMu was also believed to be talking to private equity firms.
The FDIC was seeking a buyer willing to bear a large burden of WaMu's losses, to lessen the impact on the insurance fund.
In a statement, JPMorgan Chase said it was not acquiring any senior unsecured debt, subordinated debt, and preferred stock of Washington Mutual's banks, or any assets or liabilities of the holding company, Washington Mutual Inc.
JPMorgan Chase's chief executive, Jamie Dimon said in a conference call, the "only negative" related to the deal was "how to handle some of these bad assets". He did not elaborate.
In a statement, JPMorgan Chase said it was not acquiring any senior unsecured debt, subordinated debt, and preferred stock of Washington Mutual's banks, or any assets or liabilities of the holding company, Washington Mutual Inc.
JPMorgan Chase's chief executive, Jamie Dimon said in a conference call, the "only negative" related to the deal was "how to handle some of these bad assets". He did not elaborate.
SOUTH CHARLESTON - A West Virginia man who police said passed gas and fanned it toward a patrolman has been charged with battery on a police officer.
Jose A. Cruz, 34, of Clarksburg, was pulled over for driving without headlights, police said. According to the criminal complaint, Cruz smelled of alcohol, had slurred speech and failed three field sobriety tests before he was handcuffed and taken to a police station for a breathalyser test.
As Patrolman T.E. Parsons prepared the machine, Cruz scooted his chair toward Parsons, lifted his leg and "passed gas loudly," the complaint said.
Cruz, according to complaint, then fanned the gas toward the officer.
"The gas was very odorous and created contact of an insulting or provoking nature with Patrolman Parsons," the complaint alleged.
He was also charged with driving under the influence, driving without headlights and two counts of obstruction.
Cruz acknowledged passing gas, but said he didn't move his chair toward the officer nor aim gas at the patrolman. He said he had an upset stomach at the time, but police denied his request to go to the bathroom when he first arrived at the station.
Wellington City Council staff were not required to remove a large, unidentified lump of greasy substance from a south coast beach today -- locals did it for them.
The lump apparently washed up at Breaker Bay during the weekend and once word got out that it could be valuable ambergris -- an excretion from whales that is used to make perfume -- locals started pillaging it.
...
"We went out there this morning and there were people sort of lunging at it with spades and sharp implements trying to chop pieces off so they could make off with it and make their fortunes," he said.
"Whether people are now going to try and pass it off on TradeMe as highly valuable ambergris remains to be seen."
However, the lump was cylinder shaped as if it had been manufactured and the general consensus was that it was in fact lard or cooking fat.
Rochelle Rees' background with the Labour Party was revealed by bloggers yesterday after news stories she was behind a ploy to ensure Mr Key's website link was the first to appear when people searched for "clueless" on Google.
Yesterday, National leader John Key said it was another example of petty attacks on him by Labour.
If you think that global financial "crises" seem to be happening with increasing frequency, congratulations - you're right.
...
It was back in 1996 that Fed chairman Alan Greenspan, who was really at the centre of the liquidity flood, declared the sharemarket was suffering from "irrational exuberance".
The market ignored his warning and it wasn't till two years later, in 1998, that it suffered its first setback. When hedge fund manager Long Term Capital made some wrong bets and was staring down the barrel at bankruptcy, the US central bank decided this institution was too big to fail and organised a consortium of investment banks to absorb its assets.
The Long Term Capital episode was the first big indication that the financial system was getting sick. If a single institution that was only four years old was too big to fail without bringing the US financial system down, then something was wrong with the system. But it would get worse.
Oh oh! Here's the problem. Central banks, and the Fed in particular, have become so addicted to the need for economic growth each year that they have sacrificed a tenet of sound central banking. It seems they no longer care whether lending by banking is within prudential bounds.
Indeed, it is their effective prudential supervision that they have sacrificed at the altar of this newfound, but ultimately false, belief - that you can have continual economic growth and low inflation. This shows a surreal confidence in the private sector's ability to constantly deliver sufficient productivity gains so that inflation isn't an issue, plus deliver more income to everyone in the economy year after year.
In the past two weeks billions of dollars have vanished as the shares in Australia's Macquarie Group have fallen 45 percent, America's Morgan Stanley 47%, Goldman Sachs, 35 percent.
Their plummeting stocks appear to be following other financial giants into the abyss, as Bear Stearns, Lehman Brothers, Merrill Lynch and HBOS suffered such meltdowns they were forced to sell to rivals.
Bear, which hit trouble in March, was acquired by JP Morgan Chase in May. Lehman filed for bankruptcy protection on Monday and its core businesses were acquired by British bank Barclays the following day. Merrill Lynch is now owned by Bank of America after watching its shares dive 38% in less than a week. HBOS went to fellow British bank Lloyds TSB on Thursday after its shares fell 40% in a matter of days.
The screaming headlines say these institutions were victims of a financial meltdown as their dangerous punts on speculative debts turned septic.
There's another story and it's not pretty either.
Sydney-based Macquarie Group believes it is the victim of a concerted campaign to manipulate its share price and Australia's market regulator has started an inquiry into allegations that short-sellers who profit from falling shares are spreading false rumours.
An inquiry immediately announced by the Australian Securities & Investments Commission was echoed by New York attorney-general Mario Cuomo, who announced on Thursday a probe into possible illegal short selling in financial stocks.
"This investigation will not only encompass short-selling of Lehman Brothers and AIG but also short-selling in other companies that may be occurring, like Morgan Stanley and Goldman Sachs," he said.
In Australia, short-sellers are required to report their positions to the stock exchange daily. "Clearly some haven't been doing that," said one market source.
In practice, in Australia only "naked" short sales are being reported to the exchange - these are deals where the short seller has not yet borrowed stock. A legal ambiguity means "covered" shorting, where the seller has borrowed shares, is not reported to the ASX. As a result, no one knows how big those positions are.
Executives at Bear Stearns believe they were the victims of just such a calculated attack by short sellers. In a detailed exploration of the fall of Bear published last month, Vanity Fair journalist Bryan Burrough uncovered signs of deliberate efforts to undermine confidence in the firm.
He quotes a senior executive at a rival firm: "If I had to pick the biggest financial crime ever perpetuated, I would say, Bear Stearns."
Proving someone was behind the Bear collapse, or any other share price death spiral, is tough. The firms that are targeted are vulnerable precisely because they are highly leveraged and it may be easy for a short seller to point to evidence supporting their negative view of a stock.
CRACKDOWN
UNITED STATES: September 18 - New York attorney-general Mario Cuomo announces probe into alleged illegal short selling of shares in giant investment banks Lehman Brothers, Goldman Sachs, Morgan Stanley and insurer AIG. Short selling is a share trading strategy where a trader borrows shares and sells them on market in the hope they can be bought back more cheaply later. September 17 - Securities & Exchange Commission bans "naked" short selling, in which traders sell stock without first arranging to borrow it.
UNITED KINGDOM: September 18 - The Financial Services Authority bans all short selling in financial companies until January 16. It said anyone creating a net short position in a financial sector company is "engaging in behaviour that is market abuse [misleading behaviour]."
AUSTRALIA: September 17 - Australian Securities & Investments Commission announces extension of inquiry into market manipulation and false rumours, citing specific alleged false rumours against Macquarie Group.
… and as yet not one commentator (that I have heard or read) has pointed out the long term effect of these multi-billion bail-outs.
Not that anyone wants to know, but until those funds are retrieved the rate of inflation is going to increase. How do I define inflation? It is the decline in the buying power of the dollar; my dollar, US dollar, Aus dollar, British pound whatever.
How can the handouts be retrieved? Well economically it is quite simple, but politically it is very difficult.
You can regain the hand-outs from the direct beneficiaries in exactly the same way as any other loan. The difficulty is that this will impact directly the amount of money available for lending - ostensibly to businesses to make new business but just as likely to the worker down the road so that he can buy that $5000 flat screen tv… The effect is a slow burn on the fuse that the handouts tried to extinguish.
You can regain repayment of the handouts (let’s be honest, that is what they are) by balancing the government’s fiscal budget. To achieve that requires two very bitter political pills - either a cut in government expenditure, or an increase in taxes.
Now, where do Mr McCain and Mr Obama stand on those two matters? I doubt that either will ever say the truth - it would be political suicide.
It is an age old question. As budding economists we all ask it of our parents some time around the age of 7 or 8. Why don't they just print some more money?
We are quickly told why that doesn't work. Money is worthless unless backed by something of real value.
Unfortunately this childhood lesson is one that Wall Street seems to forget every few years.
When the product which is the focus of the speculative bubble is cash itself - as it is in this case - then the problem is far more serious.
Ironically it is the fallout from the collapse of the tech sector at the start of the decade that contained the seeds of the current meltdown.
As a response to the dot.com bust - and the additional panic caused by the World Trade Centre attacks of 2001 - the US and other central banks around the world slashed interest rates.
The aim was to give the wobbly economy a boost.
But as time wore on the cost of borrowing cash remained low. A global property boom created demand which was happily met by all manner of lenders.
As one astute commentator put it - they started lending to people like the characters from the TV show My Name is Earl
As debt was increasingly transferred and sold around financial institutions it became a commodity.
Then some smart cookie investment bankers took it a step further.
They packaged up a parcels of debt that were supposed to have a fixed rate of return and traded them as products in their own right.
Because these were new, they were unregulated. And despite the risks everyone and their grandmother's dog got in on them - including banks like ANZ in New Zealand who sold them to unsuspecting mum and dad investors as sensible investment products.
Banks began facing up to that reality by writing down the value of the debt products they owned. In other words they admitted these products weren't worth what they thought.
Billions disappeared from their balance sheets. Every time one bank wrote down the value it affected the value for other banks.
Suddenly the investment banks that were in trouble because of the amount of worthless debt product they owned started running out of cash. They had been spending more than they had - because they thought they had a lot more than it turned out they really did.
Banks like Bear Stearns and Lehman Bros needed to borrow more just to survive.
But as the crisis grew those who still had cash to lend became risk averse. The cost of borrowing sky rocketed.
In a healthy system confidence and reasonably priced credit is vital to keep business humming.
Business needs credit to grow, to develop new and exciting products which in turn boost economic output and create jobs and wealth for ordinary people.
U.S. to Sell Bunker-Busting Bombs to Israel
by Nissan Ratzlav-Katz
(IsraelNN.com) The U.S. government has agreed to sell 1,000 satellite-guided "mini-bunker-buster" bombs to Israel. Meanwhile, a U.S. Defense Department official on Friday hinted at informal nuclear defense arrangements with Israel.
Boeing's Guided Bomb Unit (GBU)-39 bomb, weighing in at just 113 kilograms (250 pounds), was developed for penetrating fortified targets located underground. The U.S. decision to sell the munitions to Israel was somewhat of a retreat from a refusal last week to supply the IDF with the more powerful two-ton GBU-29 bunker-busters, despite earlier commitments to do so. In 2005, the Bush administration authorized the sale of 100 GBU-29s to Israel in a proposed deal worth around $30 million. The currently approved deal will be worth a total of $77 million.
It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.
Adam Smith
Extreme valuation of ’service’ and a denigration of the private sector is something that bothers me about both McCain and Obama.
The is, of course, nothing wrong with charitable acts and serving one’s fellow man. It is extremely laudatory and certainly we should encourage it. However, it is capitalism and the free market, not public charity that it the engine for generating growth, raising living standards and yes, increasing equality. Both McCain and Obama lack experience in the private sector, which isn’t necessarily disqualifing, but when it contributes to the distain of the private sector that I have seen from both camps this campaign season it is troubling.
I wish that both McCain and Obama would take a little time to read Adam Smith and Milton Friedman.The problem of social organization is how to set up an arrangement under which greed will do the least harm, capitalism is that kind of a system.
Milton Friedman
Let us just suppose for the moment that Friedman is right.
If the current “meltdown” of the US economy is the result of greed, what was capitalism doing to countervail?
If the current “meltdown” of the US economy is the failure of capitalism, what might replace it?
07.11.08, 11:55 AM ET
NEW YORK (Thomson Financial) - U.S. stocks fell further Friday after U.S. Treasury Secretary Henry Paulson indicated that a bailout of troubled mortgage giants Fannie Mae and Freddie Mac was not on the horizon.
Sept. 7 (Bloomberg) -- The U.S. government seized control of Fannie Mae and Freddie Mac after the biggest surge in mortgage defaults in at least three decades threatened to topple the companies making up almost half the U.S. home-loan market.
``Our economy and our markets will not recover until the bulk of this housing correction is behind us,'' Treasury Secretary Henry Paulson, who engineered the takeover along with Federal Housing Finance Agency Director James Lockhart, said in Washington today. ``Fannie Mae and Freddie Mac are critical to turning the corner.''
Is that all there is, is that all there is
If that's all there is my friends, then let's keep dancing
Let's break out the booze and have a ball
If that's all there is
Families are like fudge...
mostly sweet with a few nuts.
If you are feeling anxious — and you should be — about the world’s appetite for nuclear weapons, there is a bit of good news. More countries than we ever expected are refusing to be pressured by the United States and India to approve an ill-conceived nuclear deal.
For 30 years, ever since India used its civilian nuclear program to produce a bomb, the world has been banned from selling nuclear technology to India. Three years ago, President Bush agreed, with far too few conditions, to break that ban and sell India reactors and fuel.
The White House argued that India is an important democracy and shrugged off critics who said that breaking the rules would make it even harder to pressure Iran and others to abandon their nuclear ambitions.
Mr. Bush and his team were so eager for a foreign policy success that they gave away the store. They extracted no promise from India to stop producing bomb-making material. No promise not to expand its arsenal. And no promise not to resume nuclear testing.
