"Our Children and Grandchildren are not merely statistics towards which we can be indifferent" JFK

Thursday, March 31, 2011

Hey Ben; You're Inflation Blind fold Needs Another Layer (Michael Pento)

Thursday, March 31, 2011
By: Michael Pento

While the Fed continues its quest to save us from the horrors of deflation, the middle class is being swallowed by a tsunami of rising prices.

Wall Mart, the world’s largest retailer and second largest employer in the U.S., is warning that inflation is “going to be serious”. CEO Bill Simon told the editorial board of USA Today; "We’re seeing cost increases starting to come through at a pretty rapid rate." Wall Mart up until now has largely insulated American consumers from inflation by supplying them with low cost goods produced abroad. However, rising labor costs in China and soaring raw material costs are causing sharp price increases in imported goods.

Meanwhile, Hershey’s is raising wholesale prices on most of its candy by 10%. The company sites the reason being higher costs for raw materials, fuel, utilities and transportation. Sound familiar?

The Fed now is on record saying they aren’t comfortable with inflation being anything less than 2%. Now I’m not a mathematician, but I believe 10% is higher than 2%. Does 10% inflation make Ben happy? Is it enough inflation to calm his fears over deflation?

If you’re thinking 10% inflation courtesy of the Hershey Co. doesn’t represent the real rate of inflation, you would also have to believe it’s a pure coincidence that Shadow Stats calculates inflation at just about the same deadly rate.

The Keynesians are scratching their heads about now. They are saying, “How can this be”? “Inflation is impossible without rising wages and since there is a huge labor slack and capacity utilization is so low, we will just have to ignore the empirical evidence in front of our faces.” To that I’d say: Inflation comes from the central bank creating money to pay principal and interest on the national debt that the country was unable to provide via legitimate taxation. And, if inflation came from rising wages, real incomes would always increase and inflation would be a wonderful thing.

Michael Pento, Senior Economist at Euro Pacific Capital is a well-established specialist in the “Austrian School” of economics. He is a regular guest on CNBC, Bloomberg, Fox Business, and other national media outlets and his market analysis can be read in most major financial publications, including the Wall Street Journal. Prior to joining Euro Pacific, Michael worked for a boutique investment advisory firm to create ETFs and UITs that were sold throughout Wall Street. Earlier in his career, he worked on the floor of the NYSE.

Wednesday, March 30, 2011

While Congress proposes cuts to Head Start and Food Stamps, the Air Force spends $4 mil per day on bomb gifts for Libya

Our elected "representatives" proposed
cutting $2.7 million per day
($1 billion annually) from Head Start Programs
while the Air Force spends $4 million per day
on bombs for Libya.

The Hill
By: John Bennett
March 30, 2011

The U.S. Air Force's portion of the Pentagon's $550 million tab for the opening days of the Libyan military campaign was $50 million, senior service officials said Wednesday, and Pentagon discussions about a special emergency spending measure "are unresolved."

"The first thing we did" at the onset of the Libyan operation "was start tracking those additional costs," Air Force Secretary Michael Donley told the Senate Appropriations Committee.

The air service has spent $4 million a day just on the munitions it has fired to pound Libyan leader Moammar Gadhafi's military, Donley said.

Air Force Chief of Staff Gen. Norton Schwartz told the panel the service's costs should grow to about $70 million through the second week of the campaign.

A Pentagon official on Tuesday told The Hill the U.S. military's tab for the opening days of the mission was $550 million. U.S. costs are expected to level out at about $40 million a month, the official added.

Lawmakers from both parties have raised concerns about the costs of the Libyan campaign as Washington wrestles with a fiscal crisis.

Schwartz said costs should come down for the Air Force and the entire U.S. military force should shrink as coalition aircraft take on more sorties, including "strike missions," meaning ones targeting Libyan military platforms and facilities.

In the meantime, after initially predicting the Air Force's prized F-22 fighter would be used "in the early days" of a Libyan operation, Schwartz told the panel the primary reason the Raptor fleet was not used is because there are no F-22s based in Europe or the Middle East.

The decision came because there was an emphasis on setting the operation in motion quickly, and moving F-22s would take longer than using other fighters already nearby, like the F-15, Schwartz said. Donley added that the F-15 is better suited to take out ground targets than the F-22, designed primarily for fighter-on-fighter dog fighting.

Tuesday, March 29, 2011

Average U.S. Loan in Foreclosure: 537 Days Delinquent

JACKSONVILLE, Fla. - March 28, 2011 -The February Mortgage Monitor report released by Lender Processing Services (NYSE: LPS) shows that while delinquencies continue to decline, an enormous backlog of foreclosures still exists with overhang at every level. As of the end of February, foreclosure inventory levels stand at more than 30 times monthly foreclosure sales volume, indicating this backlog will continue for quite some time. Ultimately, these foreclosures will most likely reenter the market as REO properties, putting even more downward pressure on U.S. home values.

February’s data also showed a 23 percent increase in Option ARM foreclosures over the last six months, far more than any other product type. In terms of absolute numbers, Option ARM foreclosures stand at 18.8 percent, a higher level than Subprime foreclosures ever reached. In addition, deterioration continues in the Non-Agency Prime segment. Both Jumbo and Conforming Non-Agency Prime loans showed increases in foreclosures and were the only product areas with increases in delinquencies.

The data also showed that banks’ modification efforts have begun to pay off, as 22 percent of loans that were 90+ days delinquent 12 months ago are now current. Timelines continue to extend, with the average U.S. loan in foreclosure now having been delinquent for a record 537 days, and a full 30 percent of loans in foreclosure have not made a payment in over two years.

As reported in LPS' First Look release, other key results from LPS' latest Mortgage Monitor report include:
  • Total U.S. loan delinquency rate: 8.8 percent
  • Total U.S. foreclosure inventory rate: 4.15 percent
  • Total U.S. non-current inventory: 6,856,000
  • States with most non-current* loans: Florida, Nevada, Mississippi, New Jersey, Georgia
  • States with fewest non-current* loans: Montana, Wyoming, Alaska, South Dakota, North Dakota
Link to additional LPS News Releases

Jon Stewart:GE's $14.2 billion profit and no federal income taxes and Steve Martin way ahead of his time

March 28, 2011

Jon Stewart on General Electric (GE) making $14.2 billion profit for 2010 and paid no federal income tax.  Jon also criticized Obama for saying he would stop corporations from profiting from outsourced labor when they pay no domestic taxes, but instead making GE CEO Jeffrey Immelt a chairman on his new economic council.

Ironically, Jeff "the jobs butcher" Immelt cut 1/5 of their American workforce during the prior 9 years.

January 21, 2011 (CNN)
President Obama announced the creation of an economic advisory council Friday that will be headed by Jeffrey Immelt, the chief executive and chairman of General Electric.

The President's Council on Jobs and Competitiveness will replace the Economic Recovery Advisory Board that was headed by former Federal Reserve Chairman Paul Volcker.

Volcker's board helped pull the economy "back from the brink," Obama said. Immelt's panel will be charged with "putting the economy into overdrive."

"Jeff's somebody who brings a wealth of experience to the table," Obama said. "We think GE has something to teach businesses all across America."

Steve Martin January January 21, 1978 (ahead of his time)
SNL Transcripts

You.. can be a millionaire.. and never pay taxes! You can be a millionaire.. and never pay taxes! You say.. "Steve.. how can I be a millionaire.. and never pay taxes?" First.. get a million dollars.

Now.. you say, "Steve.. what do I say to the tax man when he comes to my door and says, 'You.. have never paid taxes'?" Two simple words. Two simple words in the English language: "I forgot!"

How many times do we let ourselves get into terrible situations because we don't say "I forgot"? Let's say you're on trial for armed robbery. You say to the judge, "I forgot armed robbery was illegal." Let's suppose he says back to you, "You have committed a foul crime. you have stolen hundreds and thousands of dollars from people at random, and you say, 'I forgot'?"

Two simple words: Excuuuuuse me!!"

The Daily Show

Sunday, March 27, 2011

Stock Market in Denial (Comstock Partners)

In sum investors are in a state of denial
similar to when they denied the dot-com boom
was a serious problem in early 2000,
or that subprime mortgages
were a problem in 2007

Hope is the denial of reality.
Margaret Weis

Comstock Partners
March 24, 2011

Those of you who watch financial TV or read the financial media have probably heard the current market referred to as the "nothing matters" market since it is supposedly ignoring a spate of negative news. According to this view, the negative news is exogenous and temporary while the true backbone of the market is the so-called strengthening recovery that has a long way to go. We have a number of disagreements with this point of view.

First, you may have noticed that the market has not exactly ignored the problems. The S and P 500 peaked about five weeks ago at 1344 and then proceeded to fall 7.1%. It has since climbed back by 4.6% in a rally that looks somewhat anemic by past standards. This type of action is actually typical of the way most bear markets begin. Generally bear markets go through three psychological phases----denial, concern and capitulation. Most often, but not always, the market rallies between each phase. The denial phase is the initial downleg from the bull market high, and we are only at the start of that downleg now.

During the denial phase the majority of investors are still in a bullish frame of mind after seeing continual profits in their account and having seen the market bounce back from prior corrections. They look upon the decline as merely another buying opportunity and think that stocks are cheap. In addition the fundamentals during this period are still perceived as positive and any negative news is downplayed.

Second, we don't regard the negative news as necessarily temporary, and only the tragic Japanese earthquake is truly exogenous. The European sovereign debt problem is a spillover from the massive 2008 credit crisis, and is not going to be resolved anytime soon. When the crisis initially emerged in Greece it was reasonably clear that the problems could spread to Ireland, Portugal and Spain, and, so far, has continued along that path. The Mid-East, North African crisis was always of a matter of "when" rather than "if" and was a recognized risk. It is not going away soon. China is engaged in the high-wire act of attempting to rein in inflation without causing a recession, a feat that historically has had a low chance of success.

It is also far too early to dismiss the Japanese earthquake as a passing phenomenon.  We still don't know how this will all play out.  With high levels of radiation in the water and farmland of the affected area, we don't know if this will become a "dead zone" for years to come. We have also heard about the possibility of significant global supply disruptions and reduced output that could presage lower demand and scarcities.

Third, the so-called strengthening recovery that supposedly more than offsets all of the above is highly fragile and subject to reversal. The second dip in housing that we have expected is now upon us. House prices are falling and inventories are extremely high while close to a quarter of homes with mortgages are underwater. The further dip in prices will put even more mortgages underwater, leading to even more foreclosures and an undermining of consumer net worth, confidence and spending. Real wages have decreased in four of the last five months and even new orders for durable goods, a precursor for capex, has weakened in the last two months.

In addition let's not overlook the point that QE2, which is pouring about $3.5 billion into the economy every weekday, is due to end on June 30th, and is unlikely to be extended. Both the economy and the market slowed significantly after the conclusion of QE1 and came back only with the announcement of QE2. At that point monetary policy becomes a headwind instead of tailwind at a time when political pressures are reining in fiscal policy as well.

In sum investors are in a state of denial similar to when they denied the dot-com boom was a serious problem in early 2000, or that subprime mortgages were a problem in 2007. This is typical of investor behavior at tops in all publically traded markets over hundreds of years, and human behavior is not likely to suddenly change now.

Bernie Sanders: Time for American Corporations to Pay Their Fair Share and give our grandchildren a break

Yes America, it pays well to have friends in high places
Jeff Immelt (General Electric CEO) and heading
President’s Council on Jobs and Competitiveness

Senator Bernie Sanders

BURLINGTON, Vt., March 27 - While hard working Americans fill out their income tax returns this tax season, General Electric and other giant profitable corporations are avoiding U.S. taxes altogether.

With Congress returning to Capitol Hill on Monday to debate steep spending cuts, Sen. Bernie Sanders (I-Vt.) said the wealthiest Americans and most profitable corporations must do their share to help bring down our record-breaking deficit.

Sanders renewed his call for shared sacrifice after it was reported that General Electric and other major corporations paid no U.S. taxes after posting huge profits. Sanders said it is grossly unfair for congressional Republicans to propose major cuts to Head Start, Pell Grants, the Social Security Administration, nutrition grants for pregnant low-income women and the Environmental Protection Agency while ignoring the reality that some of the most profitable corporations pay nothing or almost nothing in federal income taxes.

Sanders compiled a list of some of some of the 10
worst corporate income tax avoiders.

Time to remove corporations fair share
off the backs of our grandchildren
Vigilant Grandpa
  1. Exxon Mobil made $19 billion in profits in 2009. Exxon not only paid no federal income taxes, it actually received a $156 million rebate from the IRS, according to its SEC filings.
  2. Bank of America received a $1.9 billion tax refund from the IRS last year, although it made $4.4 billion in profits and received a bailout from the Federal Reserve and the Treasury Department of nearly $1 trillion.
  3. Over the past five years, while General Electric made $26 billion in profits in the United States, it received a $4.1 billion refund from the IRS.
  4. Chevron received a $19 million refund from the IRS last year after it made $10 billion in profits in 2009.
  5. Boeing, which received a $30 billion contract from the Pentagon to build 179 airborne tankers, got a $124 million refund from the IRS last year.
  6. Valero Energy, the 25th largest company in America with $68 billion in sales last year received a $157 million tax refund check from the IRS and, over the past three years, it received a $134 million tax break from the oil and gas manufacturing tax deduction.
  7. Goldman Sachs in 2008 only paid 1.1 percent of its income in taxes even though it earned a profit of $2.3 billion and received an almost $800 billion from the Federal Reserve and U.S. Treasury Department.
  8. Citigroup last year made more than $4 billion in profits but paid no federal income taxes. It received a $2.5 trillion bailout from the Federal Reserve and U.S. Treasury.
  9. ConocoPhillips, the fifth largest oil company in the United States, made $16 billion in profits from 2007 through 2009, but received $451 million in tax breaks through the oil and gas manufacturing deduction.
  10. Over the past five years, Carnival Cruise Lines made more than $11 billion in profits, but its federal income tax rate during those years was just 1.1 percent.
Sanders has called for closing corporate tax loopholes and eliminating tax breaks for oil and gas companies. He also introduced legislation to impose a 5.4 percent surtax on millionaires that would yield up to $50 billion a year. The senator has said that spending cuts must be paired with new revenue so the federal budget is not balanced solely on the backs of working families.

"We have a deficit problem. It has to be addressed," Sanders said, "but it cannot be addressed on the backs of the sick, the elderly, the poor, young people, the most vulnerable in this country. The wealthiest people and the largest corporations in this country have got to contribute. We've got to talk about shared sacrifice."

Saturday, March 26, 2011

In Prison for Taking a Liar Loan (but not any banksters Making Liar Loans)

As part of his sentence, Mr. Engle was
ordered to pay $262,500 in restitution to the
owner of his mortgages.
And what institution might that be?
You guessed it: Countrywide,
now owned by Bank of America.

Judge Accepts S.E.C.’s $150 Mil Fine Deal
With Bank of America
half-baked justice at best”
February 22, 2010 

The New York Times
March 25, 2011
By Joe Nocera

A few weeks ago, when the Justice Department decided not to prosecute Angelo Mozilo, the former chief executive of Countrywide, I wrote a column lamenting the fact that none of the big fish were likely to go to prison for their roles in the financial crisis.

Soon after that column ran, I received an e-mail from a man named Richard Engle, who informed me that I was wrong. There was, in fact, someone behind bars for what he’d supposedly done during the subprime bubble. It was his 48-year-old son, Charlie.

On Valentine’s Day, the elder Mr. Engle said, his son had entered a minimum-security prison in Beaver, W.Va., to begin serving a 21-month sentence for mortgage fraud. He then proceeded to tell me the tale of how federal agents nabbed his son — a tale he backed up with reams of documents and records that suggest, if nothing else, that when the federal government is truly motivated, there is no mountain it won’t move to prosecute someone it wants to nail. And it was definitely motivated to nail Charlie Engle.

Mr. Engle’s is a tale worth telling for a number of reasons, not the least of which is its punch line. Was Mr. Engle convicted of running a crooked subprime company? Was he a mortgage broker who trafficked in predatory loans? A Wall Street huckster who sold toxic assets?

No. Charlie Engle wasn’t a seller of bad mortgages. He was a borrower. And the “mortgage fraud” for which he was prosecuted was something that literally millions of Americans did during the subprime bubble. Supposedly, he lied on two liar loans.

“The Department of Justice has made prosecuting financial crimes, including mortgage fraud, a high priority,” said Neil H. MacBride, the United States attorney for the Eastern District of Virginia, in a statement. (Mr. MacBride, whose office prosecuted Mr. Engle, declined to be interviewed.)

Apparently, though, it’s only a high priority if the target is a borrower. Mr. Mozilo’s company made billions in profit, some of it on liar loans that he acknowledged at the time were likely to be fraudulent and which did untold damage to the economy. And he personally was paid hundreds of millions of dollars. Though he agreed last year to a $67.5 million fine to settle fraud charges brought by the Securities and Exchange Commission, it was a small fraction of what he earned. Otherwise, he walked. Thus does the Justice Department display its priorities in the aftermath of the crisis.

It’s not just that Mr. Engle is the smallest of small fry that is bothersome about his prosecution. It is also the way the government went about building its case. Although Mr. Engle took out the two stated-income loans, as liar loans are more formally called, in late 2005 and early 2006, it wasn’t until three years later that his troubles began.

As a young man, Mr. Engle had been a serious drug addict, but after he got clean, he became an ultra-marathoner, one of the best in the world. In the fall of 2006, he and two other ultra-marathoners took on an almost unimaginable challenge: they ran across the Sahara Desert, something that had never been done before. The run took 111 days, and was documented in a film financed by Matt Damon, who served as executive producer and narrator. Mr. Engle received $30,000 for his participation.

The film, “Running the Sahara,” was released in the fall of 2008. Eventually, it caught the attention of Robert W. Nordlander, a special agent for the Internal Revenue Service. As Mr. Nordlander later told the grand jury, “Being the special agent that I am, I was wondering, how does a guy train for this because most people have to work from nine to five and it’s very difficult to train for this part-time.” (He also told the grand jurors that sometimes, when he sees somebody driving a Ferrari, he’ll check to see if they make enough money to afford it. When I called Mr. Nordlander and others at the I.R.S. to ask whether this was an appropriate way to choose subjects for criminal tax investigations, my questions were met with a stone wall of silence.)

Mr. Engle’s tax records showed that while his actual income was substantial, his taxable income was quite small, in part because he had a large tax-loss carry forward, due to a business deal he’d been involved in several years earlier. (Mr. Nordlander would later inform the grand jury only of his much lower taxable income, which made it seem more suspicious.) Still convinced that Mr. Engle must be hiding income, Mr. Nordlander did undercover surveillance and took “Dumpster dives” into Mr. Engle’s garbage. He mainly discovered that Mr. Engle lived modestly.

In March 2009, still unsatisfied, Mr. Nordlander persuaded his superiors to send an attractive female undercover agent, Ellen Burrows, to meet Mr. Engle and see if she could get him to say something incriminating. In the course of several flirtatious encounters, she asked him about his investments.

After acknowledging that he had been speculating in real estate during the bubble to help support his running, he said, according to Mr. Nordlander’s grand jury testimony, “I had a couple of good liar loans out there, you know, which my mortgage broker didn’t mind writing down, you know, that I was making four hundred thousand grand a year when he knew I wasn’t.” 
Complete Article...Keep Reading

Thursday, March 24, 2011

On any given night, 650,000 Americans are homeless

The New Colossus
By Emma Lazarus, 1883
Not like the brazen giant of Greek fame,
With conquering limbs astride from land to land;
Here at our sea-washed, sunset gates shall stand
A mighty woman with a torch, whose flame
Is the imprisoned lightning, and her name
Mother of Exiles. From her beacon-hand
Glows world-wide welcome; her mild eyes command
The air-bridged harbor that twin cities frame.
"Keep, ancient lands, your storied pomp!" cries she
With silent lips. "Give me your tired, your poor,
Your huddled masses yearning to breathe free,
The wretched refuse of your teeming shore.
Send these, the homeless, tempest-tost to me,
I lift my lamp beside the golden door!" 

On an average night in the United States,
roughly 650,000 people are homeless

NEW YORK, March 24, 2011 /PRNewswire-USNewswire/ -- All levels of government have struggled with managing homelessness. On an average night in the United States, roughly 650,000 people are homeless: living in shelters, doubled up with family and friends, or sleeping on the streets. Beginning in the early 2000s, states began developing statewide plans to confront this issue, and currently there are 28 approved state plans to end homelessness.

Today, many of these plans are approaching their midpoints and undergoing revisions while other states remain without plans. With a new federal plan to alleviate homelessness in place and changes to the HEARTH Act pending, the Institute for Children, Poverty, and Homelessness (ICPH) examined the scope and effectiveness of the existing state plans through qualitative interviews with government employees and nonprofit representatives.

"This report uses shared experiences across states to assist stakeholders in thoughtfully tailoring their plans for ending homelessness so that they truly move from page to action and ultimately [to] the outcomes envisioned," says Matthew Adams, principal policy analyst at ICPH.

"Beyond Chronic Homelessness: A Review of Statewide Plans" reflects on past progress to inform future efforts. ICPH focused on (1) the effect of the federal emphasis on chronic homelessness on the contents of statewide plans, and (2) the main determinants of successful implementation of plan goals. Key findings and subsequent policy recommendations from the report are as follows:
  • Despite federal emphasis on chronically homeless individuals, states predominantly chose to tailor the scope of their plans to local needs, whether they targeted chronically homeless or not.
  • Respondents cited actionable goals that were realistic and specific with timelines, measurable outcomes, funding, and yearly benchmarks as well as progress reports and updates to overcome stalled progress or enact necessary changes.
  • Collaboration is one of the top three factors that help or hinder goal implementation. By sharing timely and frequent communication between organizations, collaboration allows government agencies and service providers to respond quickly and efficiently to emerging issues.
  • Innovative states are not using the current economic times as an excuse but instead are relying on unique funding options, from creative taxes to tying the grant application process to plan goals.
The 28 states with approved statewide plans to end homelessness are Alabama, Alaska, Arizona, Connecticut, Delaware, District of Columbia, Georgia, Hawaii, Idaho, Iowa, Kentucky, Maine, Maryland, Massachusetts, Minnesota, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Oklahoma, Oregon, Pennsylvania, Rhode Island, Utah, Vermont, Washington, and Wisconsin. For the full report and the policy recommendations highlighting innovative state strategies, go to ICPHUSA.

The Institute for Children, Poverty, and Homelessness (ICPH) is an independent nonprofit research organization based in New York City. ICPH studies the impact of poverty on family and child well-being and generates research that will enhance public policies and programs affecting poor or homeless children and their families. Specifically, ICPH examines the condition of extreme poverty in the United States and its effect on educational attainment, housing, employment, child welfare, domestic violence, and family wellness. Please visit our Web site for more information.

We hold these truths to be self-evident, that all men are
created equal, that they are endowed by their Creator with
certain unalienable Rights, that among these are
Life, Liberty and the pursuit of Happiness.

$21.3 Billion Food Budget Shortfall for Americans at Risk of Hunger

CHICAGO, March 24, 2011 /PRNewswire-USNewswire/ -- Feeding America, the nation's largest domestic hunger-relief organization, today released a landmark study, "Map the Meal Gap," providing insight for the first time about the number of meals missing from the tables of American families struggling with hunger each year – an estimated 8.4 billion nationwide.

The findings of "Map the Meal Gap" are based on statistics collected by the U.S. Department of Agriculture, U.S. Census Bureau, and food price data and analysis provided by The Nielsen Company, a global information and measurement company providing insights into what consumers watch and buy. The study was supported by The Howard G.Buffett Foundation and Nielsen.

According to U.S. Census Bureau Current Population Survey data, people struggling with hunger estimate they would need about $56 more each month on average during the months that they are food insecure to address the shortages in their food budget. On a national level, "Map the Meal Gap" shows this shortfall represents an estimated $21.3 billion on an annual basis.

In a departure from the standard of measuring meals in pounds, "Map the Meal Gap" estimates the relative cost of a meal, adjusting the national average of $2.54 per meal that food secure people report they usually spend on an average meal, according to food prices in each county.

"Map the Meal Gap" also provides critical information that has never been previously available -- food insecurity rates for each county and Congressional District. Previously, food insecurity data was only available at the state level in the USDA's annual report. The study further analyzes each county's food insecure population to determine their income eligibility for federal nutrition assistance. This data has the potential to redefine the way service providers and policy makers address areas of need.

"We know hunger exists in every state across the nation, but it looks different from county to county, and therefore, so do the solutions. The results of this study show that the best way for us to help people facing hunger is to understand who is hungry and why they are hungry at the community level," said Vicki Escarra, president and CEO of Feeding America.

"Together, the emergency food system and critical federal nutrition programs weave a comprehensive nutrition safety net reaching at-risk Americans at different income bands and in different settings, with special focus on vulnerable child and senior populations."

"There is no 'one size fits all' solution for hunger. For example, in Pulaski County, which is at the southern tip of Illinois, more than 20 percent of the population is food insecure. Of those individuals, 63 percent are potentially eligible for enrollment in the SNAP program (formerly known as the Food Stamp Program). This sample alone shows just how significant SNAP can be for many communities in this country," said Escarra.

"But in Lake County Illinois, a suburb of Chicago, 54 percent of the food insecure population does not qualify for food stamps or other government programs, so they often must rely on Feeding America and other charities to help feed themselves and their families."

"Map the Meal Gap" provides the following data for each county in the United States in an interactive map format available online:
  • The percentage of the population who is food insecure.
  • The percentage of the food insecure population who qualify based on income for SNAP (foods stamps) and other federal nutrition programs.
  • The percentage of the food insecure population who do NOT qualify for federal nutrition programs and often must rely on charitable food assistance programs and who also need better wages and employment opportunities to help them meet their basic needs.
  • The average price per meal in each county, based on new research by The Nielsen Company.
Complete Press Release

Wednesday, March 23, 2011

Judge Rakoff not happy with SEC and their "without admitting or denying wrongdoing"

The New York Times
March 22, 2011

Woe be to the S.E.C. lawyer who next draws Judge Jed S. Rakoff.

The Manhattan federal judge has again criticized the Securities and Exchange Commission over the way it strikes securities settlements.

On Monday, Judge Rakoff approved a $3 million agreement between the S.E.C. and Vitesse Semiconductor and three former executives over the improper accounting of revenue and the backdating of stock options. At the same time, he had plenty to say about the commission. He again chafed at what he described as the S.E.C. treating the court as a “rubber stamp.”

More significant, much of his opinion was aimed at the boiler-plate language hated by investors but found in nearly every securities regulatory settlement: “without admitting or denying wrongdoing.”

Wall Street firms prefer that language as a defense in shareholder lawsuits, and no doubt it makes it easier for regulators to achieve an enforcement action.

In his opinion, Judge Rakoff gave a quick primer on the history of the settlement practice, finding it origins earlier than what the agency itself said was standard from 1972 on. its legacy has been something less than desirable, he concluded:

The result is a stew of confusion and hypocrisy unworthy of such a proud agency as the S.E.C. The defendant is free to proclaim that he has never remotely admitted the terrible wrongs alleged by the S.E.C.; but, by gosh, he had better be careful not to deny them either (though, as one would expect, his supporters feel no such compunction). Only one thing is left certain: the public will never know whether the S.E.C.’s charges are true, at least not in a way that they can take as established by these proceedings.

This might be defensible if all that were involved was a private dispute between private parties. But here an agency of the United States is saying, in effect, “Although we claim that these defendants have done terrible things, they refuse to admit it and we do not propose to prove it, but will simply resort to gagging their right to deny it.”

In the case of Vitesse, Judge Rakoff found the terms of the settlement to be fair, reasonable and in the public interest, even while noting that “the proposal raises difficult questions of whether the S.E.C.’s practice of accepting settlements in which the defendants neither admit nor deny the S.E.C.’s allegations meets the standards necessary for approval by a district court.”

The judge’s skepticism about securities settlements came to the fore in September 2009, when he rejected a proposed $33 million settlement between the agency and Bank of America over its acquisition of Merrill Lynch.

Quoting from Oscar Wilde’s “Lady Windermere’s Fan,” the judge noted in his ruling then that a cynic was someone “who knows the price of everything and the value of nothing.”

He wrote:
The proposed Consent Judgment in this case suggests a rather cynical relationship between the parties: the S.E.C. gets to claim that it is exposing wrongdoing on the part of the Bank of America in a high-profile merger; the bank’s management gets to claim that they have been coerced into an onerous settlement by overzealous regulators. And all this is done at the expense, not only of the shareholders, but also of the truth.

In February 2010, the judge reluctantly approved a revised $150 million settlement with the bank.

Tuesday, March 22, 2011

Jon Stewart: "You can't simultaneously fire teachers and Tomahawk missiles."

The Daily Show
Jon Stewart
March 21, 2011

The U.S. military fires Tomahawk missiles against Libyan defense targets on the anniversary of the Iraq war.

"You know wars aren't kids... Where you don't have to pay attention to the youngest one because the older two will take care of it."

How can we afford to bomb another country? Haven't we been hearing for weeks that Wisconsin  teachers will lose their jobs because there isn't enough money?

U.S. spends over $100 million on day one of their "extended adventurous voyage" a.k.a. Operation Odyssey Dawn

While congress places food stamp
assistance on the chopping block,
U.S. Government has no problem
spending over $100 million on
Tomahawk cruise missiles during
day one of "Operation Odyssey Dawn".

Government Speak
An extended adventurous voyage or trip

National Journal
March 21, 2011
By: Megan Scully

With U.N. coalition forces bombarding Libyan leader Muammar el-Qaddafi from the sea and air, the United States’ part in the operation could ultimately hit several billion dollars -- and require the Pentagon to request emergency funding from Congress to pay for it.

The first day of Operation Odyssey Dawn had a price tag that was well over $100 million for the U.S. in missiles alone. And the U.S. military, which remains in the lead now in its third day, has pumped millions more into air- and sea-launched strikes targeting air-defense sites and ground-force positions along Libya’s coastline.

The ultimate total that the United States spends will hinge on the length and scope of the strikes as well as on the contributions of its coalition allies. But Todd Harrison, a senior fellow at the Center for Strategic and Budgetary Assessments, said on Monday that the U.S. costs could “easily pass the $1 billion mark on this operation, regardless of how well things go.”

The Pentagon has the money in its budget to cover unexpected contingencies and can also use fourth-quarter dollars to cover the costs of operations now. “They’re very used to doing this operation where they borrow from Peter to pay Paul,” said Gordon Adams, who served as the Office of Management and Budget’s associate director for national security during the Clinton administration.

However, there comes a point when there simply isn’t enough cash to pay for everything. The White House said on Monday it was not prepared to request emergency funding yet, but former Pentagon comptroller Dov Zakheim estimated that the Defense Department would need to send a request for supplemental funding to Capitol Hill if the U.S. military’s share of Libya operations expenses tops $1 billion.

"The operation in Libya is being funded with existing resources at this point. We are not planning to request a supplemental at this time," said Kenneth Baer, a spokesman for the Office of Management and Budget. Complete Article

Monday, March 21, 2011

National Association of Realtors Pulls add'l 1.36 million home sales out of thin air

National Association of Realtors
Seasonally Adjusted (a.k.a. pretend)
Existing Home Sales 4.88 million

Non Seasonally Adjusted (a.k.a. REAL)
Existing Home Sales 3.516 million

Washington, DC, March 21, 2011

WASHINGTON (March 21, 2011) – Existing-home sales fell in February following three straight monthly increases, according to the National Association of REALTORS®.

Existing-home sales, which are completed transactions that include single-family, townhomes, condominiums and co-ops, dropped 9.6 percent to a seasonally adjusted annual rate of 4.88 million in February from an upwardly revised 5.40 million in January, and are 2.8 percent below the 5.02 million pace in February 2010. NOTE: Non Seasonally adjusted figure is DOWN 17.7% month-over-month and DOWN 7.7% year-over-year.

Lawrence Yun NAR chief economist, expects an uneven recovery. “Housing affordability conditions have been at record levels and the economy has been improving, but home sales are being constrained by the twin problems of unnecessarily tight credit, and a measurable level of contract cancellations from some appraisals not supporting prices negotiated between buyers and sellers,” he said. “This tug and pull is causing a gradual but uneven recovery. Existing-home sales remain 26.4 percent above the cyclical low last July.”

A parallel NAR practitioner survey shows first-time buyers purchased 34 percent of homes in February, up from 29 percent in January; they were 42 percent in February 2010.

All-cash sales were a record 33 percent in February, up from 32 percent in January; they were 27 percent in February 2010. Investors accounted for 19 percent of sales activity in February, down from 23 percent in January; they were 19 percent in February 2010. The balance of sales were to repeat buyers.

The national median existing-home price for all housing types was $156,100 in February, which is 5.2 percent below February 2010. Distressed homes – sold at discount – accounted for a 39 percent market share in February, up from 37 percent in January and 35 percent in February 2010. “The decline in price corresponds to the record level of all-cash purchases where buyers – largely investors – are snapping up homes at bargain prices,” Yun explained. “We’d be seeing greater numbers of traditional home buyers if mortgage credit conditions return to normal.”

Total housing inventory at the end of February rose 3.5 percent to 3.49 million existing homes available for sale, which represents an 8.6-month supply at the current sales pace, up from a 7.5-month supply in January.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 4.95 percent in February from 4.76 percent in January; the rate was 4.99 percent in February 2010.

Single-family home sales fell 9.6 percent to a seasonally adjusted annual rate of 4.25 million in February from 4.70 million in January, and are 2.7 percent below the 4.37 million pace in February 2010. The median existing single-family home price was $157,000 in February, which is 4.2 percent below a year ago.

Existing condominium and co-op sales dropped 10.0 percent to a seasonally adjusted annual rate of 630,000 in February from 700,000 in January, and are 3.1 percent lower than the 650,000-unit level one year ago. The median existing condo price was $150,400 in February, down 11.1 percent from February 2010.

During December, January and February,
The National Association of Realtors 
seasonally adjusted in 3.712 MILLION
annualized existing home sales.
In other words, during this period, there were
3.7 million fewer annualized transactions.


Bernanke has 5 days to give it up on I've Got a Secret

By: Greg Stohr and Bob Ivry

March 21 (Bloomberg) -- The Federal Reserve must disclose details of emergency loans it made to banks in 2008, after the U.S. Supreme Court rejected an industry appeal that aimed to shield the records from public view.

The justices today left intact a court order that gives the Fed five days to release the records, sought by Bloomberg News’s parent company, Bloomberg LP. The Clearing House Association LLC, a group of the nation’s largest commercial banks, had asked the Supreme Court to intervene.

The order marks the first time a court has forced the Fed to reveal the names of banks that borrowed from its oldest lending program, the 98-year-old discount window. The disclosures, together with details of six bailout programs released by the central bank in December under a congressional mandate, would give taxpayers insight into the Fed’s unprecedented $3.5 trillion effort to stem the 2008 financial panic.

“I can’t recall that the Fed was ever sued and forced to release information” in its 98-year history, said Allan H. Meltzer, the author of three books on the U.S central bank and a professor at Carnegie Mellon University in Pittsburgh.

Under the trial judge’s order, the Fed must reveal 231 pages of documents related to borrowers in April and May 2008, along with loan amounts. News Corp.’s Fox News is pressing a bid for 6,186 pages of similar information on loans made from August 2007 to November 2008.

Unprecedented Disclosure
The records were originally requested under FOIA, which allows citizens access to government papers, by the late Bloomberg News reporter Mark Pittman.

As a financial crisis developed in 2007, “The Federal Reserve forgot that it is the central bank for the people of the United States and not a private academy where decisions of great importance may be withheld from public scrutiny,” said Matthew Winkler, editor in chief of Bloomberg News. “The Fed must be accountable to Congress, especially in disclosing what it does with the people’s money.”

The Clearing House Association contended that Bloomberg was seeking an unprecedented disclosure that might dissuade banks from accepting emergency loans in the future.

“Disclosure of this information threatens to harm the borrowing banks by allowing the public to observe their borrowing patterns during the recent financial crisis and draw inferences -- whether justified or not -- about their current financial conditions,” the group said in its appeal.

Obama Administration
A federal trial judge ruled in 2009 that the Fed had to disclose the records in the Bloomberg case, and a New York-based appeals court upheld that ruling.

The Clearing House Association’s chances at getting a Supreme Court hearing suffered a setback when the Obama administration urged the justices not to hear the appeal. The government said the underlying issues had limited practical significance because Congress last year laid out new rules for disclosing Fed loans in the Dodd-Frank law.

“Congress has resolved the question of whether and when the type of information at issue in this case must be disclosed” in the future, the administration said in a brief filed by acting Solicitor General Neal Katyal, President Barack Obama’s top Supreme Court lawyer.

The Fed had previously fought alongside the banks in opposing disclosure. It also sought to join the industry group in seeking high court review, only to be overruled by Katyal, according to court documents. Complete article

Agricultural Committee Prefers Cuts to Food Stamps VS Farm Subsidies

...most large commercial farmers report an
average annual income of $200,000,
well in excess of the national average

Chairman Frank Lucas, R-Okla., has reported $445,714 in
 political contributions from the agricultural industry during
the course of his career, and ranking Democrat Collin Peterson
 of Minnesota reports $809,097 in career donations.

It appears Food Stamp recipients do not contribute enough
to their elected representatives

National Journal
by Tim Fernholz
March 21, 2011

The House Agriculture Committee endorsed a letter this week to Budget Chairman Paul Ryan arguing that the Supplemental Nutrition Assistance Program, which helps low-income Americans purchase food, would make a better target for cuts than automatic subsidies to farms.

The move comes as food prices are rising -- the Department of Agriculture expects overall food prices to rise 3 percent to 4 percent this year -- making it harder for the beneficiaries of SNAP to stretch their existing benefits, even as farmers profit from the tightening market. Critics across the political spectrum have called agricultural subsidies wasteful and unnecessary, and they question the logic of maintaining them as lawmakers hunt for budget cuts.

"Conspicuously missing from the list of mandatory spending cuts the Agriculture Committee has made or is proposing to make are commodity subsidies, and specifically the $4.9 billion in direct payments that are automatically paid out each year regardless of whether a person farms,” said Jake Caldwell, the director of agricultural policy at the left-leaning Center for American Progress. “It is shortsighted of the Committee to suggest cuts to SNAP, particularly as food prices are on the rise, Americans are spending more than 10 percent of their household budget on food, and more people are enrolled in the food stamp program than ever before."

President Obama has endorsed cuts in agricultural subsidies as a way to lower the deficit without targeting essential programs, and lawmakers from both parties, like Ryan, R-Wis., have expressed similar opinions.

But the Agriculture Committee is dominated by members of Congress from farm states; Chairman Frank Lucas, R-Okla., has reported $445,714 in political contributions from the agricultural industry during the course of his career, and ranking Democrat Collin Peterson of Minnesota reports $809,097 in career donations.

The budget letter, endorsed by both Lucas and Peterson, argues that subsidies need to be in place for when record-high prices “inevitably” fall, and that higher prices have actually increased risks for farmers. But not even all farmers agree -- the Iowa Farm Bureau voted its opposition to direct payment subsidies earlier this year. Brian Riedl, a fiscal policy expert at the conservative Heritage Foundation, said that most large commercial farmers report an average annual income of $200,000, well in excess of the national average.

A Republican aide says the letters’ main message was a request that the budget committee be allowed to review its programs before final budget decisions are made, and that the programs under the committee’s jurisdiction not be cut disproportionately. Criteria for program reviews have yet to be determined.

The letter emphasizes recent reductions in the committee’s budget due to renegotiated insurance deals and higher food prices, which have reduced or temporarily eliminated the cost of some conditional subsidies. But it argues that SNAP -- which grew more expensive during the recession as unemployment increased the number of people who were eligible and as Congress expanded benefits under the economic stimulus law -- could be a target for cuts. SNAP makes up the bulk of the USDA’s budget.

Democrats stripped out some of the program’s expanded funding last year to pay for other programs, including child nutrition legislation. Now, the committee says, it will review the remaining stimulus expansions, which expire in November 2013, to see if the funds can be diverted for deficit reduction.

Democrats and Republicans are split on the value of the SNAP expansions, with the president and his party generally endorsing higher levels of spending than the GOP, which worries about a too-comfortable safety net (the program provides a monthly benefit of about $200 a person to households at or below 130 percent of the poverty level).

Anti-hunger advocates say the move to reduce food aid comes at just the wrong time. A report released by the Food Research and Action Center earlier this month said almost 1 in 5 Americans struggled to afford food for their families in 2010, with some of the highest rates of food hardship occurring just last fall.

Thursday, March 17, 2011

Senator Jon Kyl thinks cutting .00625 of the deficit is a good day's work

"`In just five weeks, we will have cut $10 billion
from this year's spending," said Mr. Kyl.
"All in all, a good day's work."

Jon's idea of a good day's work equates to .00625 of
our $1.6 trillion deficit. Jon would likely deem running
330 feet of a 10 mile run a good days work.

Can you imagine  golfing with Senator Kyl,
given he would deem a 7.5 foot tee shot
a good days work on a 400 yard Par 4 hole?

It was such a good day's work, the Senate will
be in recess from March 21st through March 27th
and again from APril 18th through May 1st.

By Janet Hook
The Wall Street Journal
March 17, 2011

WASHINGTON—The Senate on Thursday approved legislation to fund the government for three additional weeks, amid bipartisan hopes that it would be the last short-term spending bill approved by Congress for the current fiscal year.

The measure, approved 87-13, extends funding until April 8. It now goes to President Barack Obama for his signature.

Congress will have to pass a new funding mechanism by April 8 to avert a partial government shutdown.

The legislation approved Thursday cuts $6 billion from current spending levels but, to blunt Democratic opposition, draws the cuts mostly from programs targeted by both parties. They include earmarks for individual lawmakers' pet projects.

Other cuts in the bill include $200 million from wildfire-suppression efforts and $200 million in technology funds for the Social Security Administration.

Democrats and Republicans now have another three weeks to negotiate a funding plan for the remaining months of the fiscal year. The two parties are $50 billion apart on the amount they want to cut from the $1.08 trillion spent last year on discretionary programs.

Congress is in recess next week, but private talks are expected to continue among White House and congressional officials who are working to reach agreement on funding levels and on how to handle GOP-backed policy proposals. Those proposals include measures to block implementation of the health-care law, clean-air regulations and other Obama administration priorities.

The proposals, known as riders, are important to many GOP conservatives but are likely to provoke a presidential veto. They weren't included in the short-term bill that cleared the Senate.

The stopgap spending bill is needed because Congress still hasn't approved appropriations for the full 2011 fiscal year, which ends Sept. 30. The House has approved a bill to set 2011 spending at $61 billion less than 2010 levels. Between the bill passed by the Senate and an earlier short-term bill, Congress already has cut $10.5 billion.

Despite conservatives' complaints that the spending reductions weren't sufficient, Sen. Jon Kyl (R., Ariz.) said the cuts so far were a significant accomplishment.

"`In just five weeks, we will have cut $10 billion from this year's spending," said Mr. Kyl. "All in all, a good day's work."

Conservatives derided the cuts as paling in the shadow of a $1.6 trillion deficit.

"We need to do more than just trim a little bit around the edges," said Rep. Mike Lee (R., Utah), who voted against the stopgap bill, along with eight other Republicans and four Democrats.

But Senate Appropriations Committee Chairman Daniel K. Inouye (D, Hawaii) warned that federal agencies will be hard-pressed to absorb such cuts halfway through their budget year. "Agreeing to a cut of this size this late in the fiscal year will be challenging for our agencies to manage," he said.