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Fri Jan 18, 2013, 05:34 PM

Weekend Economists Discover the Blue Men January 18-21, 2013



Ah, no, I didn't mean those people....(although they will do for the "art" theme), but these:



The Tuareg (also spelled Twareg or Touareg) are a Berber people with a traditionally nomadic pastoralist lifestyle. They are the principal inhabitants of the Saharan interior of North Africa.

The Tuareg language, or languages, have an estimated 1.2 million speakers. About half this number is accounted for by speakers of the Eastern dialect (Tamajaq, Tawallammat). Most Tuareg live in the Saharan parts of Niger and Mali but, being nomadic, they move constantly across national borders, and small groups of Tuareg are also found in southeastern Algeria, southwestern Libya and northern Burkina Faso, and a small community in northern Nigeria.



The name Tuareg is derived from Targa, the Berber name of Libya's Fezzan province. The name Tuareg thus in origin designated the inhabitants of Fezzan from the perspective of the Berbers living closer to the Mediterranean coast, and was adopted from them into English, French and German during the colonial period. The Berber noun targa means "drainage channel" and by extension "arable land, garden". It designated the Wadi al-Haya area between Sabha and Ubari and is rendered in Arabic as bilad al-khayr "good land".

The name of the Tuareg for themselves is Imuhagh (Imazaghan or Imashaghen, Imazighan). The term for a Tuareg man is Amajagh (var. Amashegh, Amahagh), the term for a woman Tamajaq (var. Tamasheq, Tamahaq, Timajaghen). The spelling variants given reflect the variety of the Tuareg dialects, but they all reflect the same linguistic root, expressing the notion of "freemen", strictly only referring to the Tuareg "nobility", to the exclusion of the artisan client castes and slaves. Another self-designation of more recent origin is linguistic, Kel Tamasheq or Kel Tamajaq (Neo-Tifinagh ⴾⴻⵍ ⵜⴰⵎⴰⵌⴰⵆ "Speakers of Tamasheq".

Also encountered in ethnographic literature of the early 20th century is the name Kel Tagelmust "People of the Veil" and "the Blue People" (for the indigo colour of their veils and other clothing, which sometimes stains the skin underneath).

---wikipedia

One of the classic conflicts amongst people throughout history has been the struggles between settled people who depend on agriculture and ownership of land, and the nomads, who build no cities, own no land, but take their herds from place to place in search of food and water. Trading can also be a way of life for the unsettled peoples....or theft, for those who cannot or will not sustain themselves otherwise...another classic struggle has been between those who manufacture and accumulate wealth, and those who attack to loot and pillage the goods and populations: the pirates.

In the Sahel, as on the seas, or in the financial markets, individuals can play any or all of these roles. Except for our financial markets, the usual end game sees the nomads forcibly settled and the pirates wiped out by the more resourceful, settled people, who accumulate enough wealth and lust for their wealth to create superior armies and defenses.

With the turmoils of the Arab Spring, the rape of Libya and all the blowback, these isolated people have once again crossed the pages of history, and how the story ends, we do not yet know.

I'm betting it will end badly, however. It usually does.

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Reply Weekend Economists Discover the Blue Men January 18-21, 2013 (Original post)
Demeter Jan 2013 OP
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Response to Demeter (Original post)

Fri Jan 18, 2013, 05:46 PM

1. The People of the Veil



Who has not thrilled at the romance of the desert song?

But the actual experience is something other than romantic.

The Tuareg people inhabit a large area, covering almost all the middle and western Sahara and the north-central Sahel. In Tuareg terms, the Sahara is not one desert but many, so they call it Tinariwen ("the Deserts"). Among the many deserts in Africa, there is the true desert, Ténéré. Other deserts are more and less arid, flat and mountainous: Adrar, Tagant, Tawat (Touat) Tanezrouft, Adghagh n Fughas, Tamasna, Azawagh, Adar, Damargu, Tagama, Manga, Ayr, Tarramit (Termit), Kawar, Djado, Tadmait, Admer, Igharghar, Ahaggar, Tassili n'Ajjer, Tadrart, Idhan, Tanghart, Fezzan, Tibesti, Kalansho, Libyan Desert, etc. While there is little conflict about the driest parts of Tuareg territory, many of the water sources and pastures they need for cattle breeding get fenced off by absentee landlords, impoverishing some Tuareg communities. There is also an unresolved land conflict about many stretches of farm land just south of the Sahara. Tuareg often also claim ownership over these lands and over the crop and property of the impoverished Rimaite-people who are farming them.

The Tuareg adopted camel nomadism, along with its distinctive form of social organization, from camel-herding Arabs about two thousand years ago, when the camel was introduced to the Sahara from Arabia. Since that time, they had operated the trans-Saharan caravan trade connecting the great cities on the southern edge of the Sahara via five desert trade routes to the northern (Mediterranean) coast of Africa. The Tuareg once took captives, either for trade and sale, or for domestic labor purposes. Those who were not sold became assimilated into the Tuareg community. Slaves and herdsmen formed a component of the division of labor in camel nomadism.

They expanded southward from the Tafilalt region into the Sahel under their legendary queen Tin Hinan, who is assumed to have lived in the 4th or 5th century. Tin Hinan is credited in Tuareg lore with uniting the ancestral tribes and founding the unique culture that continues to our time. At Abalessa, a grave traditionally held to be hers has been scientifically studied.



At the turn of the 19th century, the Tuareg territory was organised into confederations, each ruled by a supreme Chief (Amenokal), along with a counsel of elders from each tribe. These confederations are sometimes called "Drum Groups" after the Amenokal's symbol of authority, a drum. Clan (Tewsit) elders, called Imegharan (wisemen), are chosen to assist the chief of the confederation. Historically, there are seven recent major confederations:

Kel Ajjer or Azjar: centre is the oasis of Aghat (Ghat).
Kel Ahaggar, in Ahaggar mountains.
Kel Adagh, or Kel Assuk: Kidal, and Tin Buktu
Iwillimmidan Kel Ataram, or Western Iwillimmidan: Ménaka, and Azawagh region (Mali)
Iwillimmidan Kel Denneg, or Eastern Iwillimmidan: Tchin-Tabaraden, Abalagh, Teliya Azawagh (Niger).
Kel Ayr: Assodé, Agadez, In Gal, Timia and Ifrwan.
Kel Gres: Zinder and Tanut (Tanout) and south into northern Nigeria.
Kel Owey: Aïr Massif, seasonally south to Tessaoua (Niger)


In the late 19th century, the Tuareg resisted the French colonial invasion of their Central Saharan homelands. Tuareg broadswords were no match for the more advanced weapons of French squadrons. After numerous massacres on both sides, the Tuareg were subdued and required to sign treaties in Mali 1905 and Niger 1917. In southern Morocco and Algeria, the French met some of the strongest resistance from the Ahaggar Tuareg. Their Amenokal, traditional chief Moussa ag Amastan, fought numerous battles in defence of the region. Finally, Tuareg territories were taken under French governance, and their confederations were largely dismantled and reorganised.

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Response to Demeter (Original post)

Fri Jan 18, 2013, 05:50 PM

2. And we have the first failed bank of 2013


Westside Community Bank, University Place, Washington
, was closed today by the Washington State Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Sunwest Bank, Irvine, California, to assume all of the deposits of Westside Community Bank.

The two branches of Westside Community Bank will reopen on Monday as branches of Sunwest Bank...As of September 30, 2012, Westside Community Bank had approximately $97.7 million in total assets and $96.5 million in total deposits. In addition to assuming all of the deposits of the failed bank, Sunwest Bank agreed to purchase essentially all of the assets...

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $20.3 million. Compared to other alternatives, Sunwest Bank's acquisition was the least costly resolution for the FDIC's DIF. Westside Community Bank is the first FDIC-insured institution to fail in the nation this year, and the first in Washington. The last FDIC-insured institution closed in the state was Bank of Whitman, Colfax, on August 5, 2011.

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Response to Demeter (Reply #2)

Fri Jan 18, 2013, 05:52 PM

3. FDIC Issues List of Banks Examined for CRA Compliance

The Federal Deposit Insurance Corporation (FDIC) today (JAN 4) issued its list of state nonmember banks recently evaluated for compliance with the Community Reinvestment Act (CRA). The list covers evaluation ratings that the FDIC assigned to institutions in October 2012. The CRA is a 1977 law intended to encourage insured banks and thrifts to meet local credit needs, including those of low- and moderate-income neighborhoods, consistent with safe and sound operations. As part of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA), Congress mandated the public disclosure of an evaluation and rating for each bank or thrift that undergoes a CRA examination on or after July 1, 1990.

A consolidated list of all state nonmember banks whose evaluations have been made publicly available since July 1, 1990, including the rating for each bank, can be obtained from the FDIC's Public Information Center, located at 3501 Fairfax Drive, Room E-1002, Arlington, VA 22226 (877-275-3342 or 703-562-2200), or via the Internet at www.fdic.gov.

A copy of an individual bank's CRA evaluation is available directly from the bank, which is required by law to make the material available upon request, or from the FDIC's Public Information Center.

http://www.fdic.gov/regulations/community/monthly/2013/crajan13.html

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Response to Demeter (Original post)

Fri Jan 18, 2013, 05:57 PM

4. Corporate Profits Have Grown By 171 Percent Under Obama -- Highest Rate Since 1900

Twice as high as the Reagan years.

http://www.alternet.org/news-amp-politics/corporate-profits-have-grown-171-percent-under-obama-highest-rate-1900?akid=9933.227380.3aa7C5&rd=1&src=newsletter778847&t=8

Business executives like to portray the Obama administration as the “ most anti-business” in history, creating an “ increasingly hostile environment for investment and job creation.” However, the data tells a far different story. According to a Bloomberg News analysis, corporate profits have grown by 171 percent under Obama, the most in the post-war era:

U.S. corporations’ after-tax profits have grown by 171 percent under Obama, more than under any president since World War II, and are now at their highest level relative to the size of the economy since the government began keeping records in 1947, according to data compiled by Bloomberg.

Profits are more than twice as high as their peak during President Ronald Reagan’s administration and more than 50 percent greater than during the late-1990s Internet boom, measured by the size of the economy.

Average annual corporate profit growth under Obama is the highest since 1900, whereas profit growth declined during both Bush presidencies. As a share of the economy, corporate profits have never been higher.

Unfortunately, this profit deluge has not been shared by workers, whose wages as a percentage of the economy have fallen to all-time lows. Workers also got dinged by the recent increase in the payroll tax, which was large enough to wipe out a minimum wage increase in some states.

**********************************************************

Pat Garofalo is economic policy editor for ThinkProgress.org. His writing has also appeared in the Nation, the Atlantic, U.S. News & World Report, and other publications. Follow him on Twitter at @Pat_Garofalo.

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Response to Demeter (Reply #4)

Fri Jan 18, 2013, 06:04 PM

5. How Extreme is the Business Roundtable? Check Out its Attack on the Elderly. By Richard (RJ) Eskow

http://www.nationofchange.org/how-extreme-business-roundtable-check-out-its-attack-elderly-1358433148

Here’s a thought experiment: What if a group of Social Security and Medicare recipients wanted to increase their benefits by, say, 1,000 percent, and proposed seizing rich people’s assets – houses, cars, boats, whatever – to pay for it? And whenever anybody suggested that was extreme, they rolled their eyes and said,
“We’re pragmatists.”
But isn’t it unfair to to just take other people’s stuff?
“Ideologues like you are the reason Washington lacks the political will to adopt our practical solutions.”


Now imagine the reverse: Rich CEOs have used every tax loophole in the book to add to their own wealth, have been bailed out directly or indirectly by the American taxpayer, and have rigged corporate governance so that they make far more than they’re worth. Now, to make sure the milk and honey keeps flowing their way, they want to cut Medicare and Social Security benefits for the beleaguered American majority. Sounds crazy, right?

Meet the CEOs of the Business Roundtable.

They hate our freedoms benefits. Matt Yglesias is right: There’s a special hatred for Social Security out there – and for Medicare, too. They’re hated because, as Yglesias says, some people don’t consider them “economically valuable.” That’s an extremist right-wing point of view by any objective measure. It’s also well outside the mainstream of public opinion for Americans of all political leanings, including Tea Party members, according to polling. When it’s espoused by rich corporate CEOs, it’s also exceptionally greedy.
..................................................................................................................

Yesterday Gary Loveman, CEO of Caesars Entertainment Corporation and head of the Roundtable’s “health and retirement committee,” told Politico, “Any effort to address the country’s fiscal problems has to have as a centerpiece reform of its principal entitlement programs.” Added Loveman: “None of us CEOs – very few of us – are ideologically driven. We’re pragmatists …I am encouraged by how relatively easy these remedies really are,” said Loveman. “… (and) they have a tremendously sanguine effect on the government’s fiscal health.”

That’s true. It is pretty easy. Just kick in a few rich people’s doors, seize their belongings … oh, wait. That’s the other extremist scenario. Loveman’s is the one where people who have paid for Social Security and Medicare coverage throughout their working lives must give some of their benefits up – for him and his friends. Problem identified: There are just too many old people.

Loveman repeats the often-disproven canard that these programs are fiscally unsound because they “were put in place in a very different demographic reality.” Social Security’s finances were successfully balanced in 1983, when the last Baby Boomer had already reached maturity. And longevity hasn’t changed significantly or unexpectedly for people who reach retirement age. Social Security’s in much better fiscal shape than most corporate benefit plans, and any long-term problems it may have are driven by a) greater wealth inequity than even the most conservative economists could have imagined in 1983; and b) massive unemployment brought on by Wall Street greed. As for Medicare, its cost problems are caused by for-profit health companies inflating medical costs. Think the Business Roundtable will mention that? Its members include the CEOs of Johnson & Johnson, Pfizer, Sanofi-Aventis, Abbott Laboratories, the Tenet hospital system, Cardinal Health, ExpressScripts, CVS/Caremark and WellPoint.

Like hell it will.

Our long-term deficits are driven by America’s runaway health care costs, which in turn are driven by our profit-driven system. It’s barely an exaggeration to say that if some of these companies and their competitors didn’t exist the Federal government might not have a deficit problem at all.

............................................................................................................

If the CEOs of the Business Roundtable are corporate America’s Stalinists, to them the elderly are kulaks, those peasants who saved enough to buy a farm – and whose existence became an ideological offense. When working Americans approach retirement age, they see them as Enemies of the People.

The CEOs of the Business Roundtable claim the government can’t afford to redeem its Medicare and Social Security pledges. The government owes more than a trillion dollars to banks and mutual funds, and much of that debt is held by people like the CEOs of the Business Roundtable.

If they don’t think the U.S. can afford to keep its commitments anymore – if they want a United States of America that welshes on its debts – that would be a good place to start. But for the wealthy, pampered, and narcissistic CEOs of the Business Roundtable, sacrifice is always for someone else. They have luxurious lives to maintain – and a revolution to lead.

AN AMAZING DIATRIBE...SO MUCH MORE AT LINK

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Response to Demeter (Original post)

Fri Jan 18, 2013, 06:09 PM

6. Meanwhile...

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Response to Demeter (Reply #6)

Sat Jan 19, 2013, 09:28 AM

52. That Will Disturb The FrightWing Fundies - Heads Might Explode - Best They Return To Idol And Beer

eom

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Response to Demeter (Original post)

Fri Jan 18, 2013, 06:12 PM

7. DU rec. thanks for posting all this.

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Response to Tuesday Afternoon (Reply #7)

Fri Jan 18, 2013, 06:24 PM

10. Thanks for joining us!

We are always glad to see new faces in our little band

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Response to Demeter (Original post)

Fri Jan 18, 2013, 06:16 PM

8. Before Default, Let Republicans Bump Up Hard Against the Debt Ceiling By Joe Conason

http://www.nationofchange.org/default-let-republicans-bump-hard-against-debt-ceiling-1358432942

A prolonged confrontation over the nation's debt ceiling — unlike the "fiscal cliff," which provoked many scary headlines — could truly be grave for both America and the world. While press coverage often mentions the possibility of lowered credit ratings for the U.S. Treasury (again), that might only be the mildest consequence if Republicans in Congress actually refuse to authorize borrowing and avoid default...Last time the nation prepared to face such an impasse, during the spring and summer of 2011, the chairman of the Treasury Borrowing Advisory Committee — a JPMorgan Chase official named Matthew Zames — laid out a disturbing scenario in a letter to Treasury Secretary Tim Geithner, in which he foresaw a rolling catastrophe that could inflict hundreds of billions in additional borrowing costs; spark a run on money funds, leading to a renewed financial crisis; severely disrupt financial markets and borrowing, killing fragile economic growth; and push the economy back into recession due to higher interest rates and tightened credit.

In short, the economy would contract sharply and the U.S. — along with the rest of the world — might well be plunged back into negative growth. If that was true in July 2011, it is equally true today, and there is no reason to dismiss that warning.

But the Republican leadership on Capitol Hill insists that they are willing to take these mind-boggling risks, solely for the purpose of enforcing an extreme austerity regime that has already done permanent damage in much of Europe. Between the "Boehner rule" demanded by House Speaker John Boehner, which requires a dollar in new spending cuts for every dollar increase in the debt ceiling, and the House Republican budget authored by Rep. Paul Ryan, Congressional Republicans evidently want not only to gut Medicare, Social Security and Medicaid, but to "eliminate more and more of the basic functions of government over time," according to the Center on Budget and Policy Priorities...No education aid, no food safety inspections, no environmental protection, no infrastructure repairs, no cancer research. From immediate economic jeopardy to long-term national decline, these prospects are obviously appalling — yet many Republican elected officials sound positively pleased about the debt ceiling crisis they have created. Senator Tom Coburn, Republican of Oklahoma, told a right-wing radio host recently that a government default would actually be a "wonderful experiment." He assured listeners, quite falsely, that their Medicare and Social Security checks would continue to arrive every month, no matter what, and that only "stupid" spending would be cut.

If Coburn — or any Republican senator — is so eager to test the debt ceiling, perhaps he should volunteer to bump up against it first. As the Tulsa World reported in 2011, federal spending in Oklahoma amounts to three times as much as the entire state budget, with Social Security alone accounting for almost a billion dollars a month there, and Medicaid and other medical assistance amounting to another $500 million-plus. Coburn's ultra-conservative, deep-red home state is highly dependent on federal employment and assistance, ranking 12th in retirement and disability payments and 11th in per capita federal payroll, despite its small size. So, by all means, let's find out, as Coburn suggested, whether we can live "on the money that's coming into the Treasury" without borrowing to finance those monthly pension checks and all those stupid federal jobs — and let's start in Oklahoma tomorrow. Then let's roll out the same experiment in every state whose senators and representatives are refusing to pay the bills they have already racked up over the years — especially states, like most of those below the Mason-Dixon line, where federal spending is far higher than the tax revenues remitted to Washington. Surely that would silence all the loud talk about this "wonderful" experiment in fiscal brinksmanship.

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Response to Demeter (Reply #8)

Fri Jan 18, 2013, 06:53 PM

16. House G.O.P. Agrees to Lift Debt Ceiling for 3 Months By JONATHAN WEISMAN

http://www.nytimes.com/2013/01/19/us/politics/house-gop-agrees-to-lift-debt-ceiling-for-3-months.html

Backing down from their hard-line stance, House Republicans said Friday that they would agree to lift the federal government’s statutory borrowing limit for three months, with a requirement that both chambers of Congress pass a budget in that time to clear the way for negotiations on long-term deficit reduction. The agreement, reached in closed-door negotiations at a party retreat in Williamsburg, Va., was a tactical retreat for House Republicans, who were increasingly isolated in their refusal to lift the debt ceiling. Speaker John A. Boehner of Ohio had previously said he would raise it only if paired with immediate spending cuts of equivalent value. The decision by Republicans seemed to significantly reduce the threat of a federal government default in coming weeks and was welcomed by Senate Democrats. The House will consider the plan next week.

“It is reassuring to see Republicans beginning to back off their threat to hold our economy hostage,” said Adam Jentleson, a spokesman for Senator Harry Reid of Nevada, the majority leader. “If the House can pass a clean debt ceiling increase to avoid default and allow the United States to meet its existing obligations, we will be happy to consider it. As President Obama has said, this issue is too important to middle-class families’ economic security to use as a ploy for collecting a ransom. We have an obligation to pay the bills we have already incurred — bills for which many House Republicans voted.”


The Republicans’ new tack is designed to start a more orderly negotiation with Mr. Obama and Senate Democrats on bipartisan ways to shrink the government’s trillion-dollar deficit. To add muscle to their efforts to bring Senate Democrats to the table, House Republicans will include a provision in the debt ceiling legislation that says lawmakers will not be paid if they do not pass a budget blueprint.

“The Democratic-controlled Senate has failed to pass a budget for four years. That is a shameful run that needs to end, this year,” Mr. Boehner said in a statement from Williamsburg. “We are going to pursue strategies that will obligate the Senate to finally join the House in confronting the government’s spending problem.”


The decision represents a victory — at least for now — for Mr. Obama, who has said for months that he will not negotiate budget cuts under the threat of a debt default. By punting that threat into the spring, budget negotiations instead will center on two other points of leverage: March 1, when $1 trillion in across-the-board military and domestic cuts are set to begin, and March 27, when a stopgap law financing the government will expire. Mr. Obama will unveil his own 10-year budget plan in February, laying out his tax and spending plans for his second term. But Senate Democrats, for the past four years, have refused to move a budget blueprint to the Senate floor, in violation of the 1974 budget act that laid out new rules for controlling federal deficits. House Republicans, for the past two years, have approved sweeping budget plans that would fundamentally remake Medicare and Medicaid, sharply reduce domestic spending, increase defense spending and order a wholesale rewriting of the federal tax code. But without Senate negotiating partners, those plans, written by Representative Paul D. Ryan of Wisconsin, the Republicans’ last vice-presidential nominee, have been more political statement than legislative program. House Republican leadership aides said Friday that by trying to force Senate Democrats’ hands, Mr. Boehner hoped to move budget talks from ad hoc negotiations between Congressional leaders and the White House to a more orderly process...But the proposal marks a significant retreat as well. In recent weeks, conservatives from the editorial board of The Wall Street Journal to the Tea Party-aligned Americans for Prosperity had called on House Republicans to drop their conditions for raising the debt ceiling. Business groups had joined in, and Republican Party elders were growing nervous about how House leaders were approaching the debt ceiling, as well as the deadlines for automatic spending cuts and refinancing the government.

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Response to Demeter (Reply #16)

Fri Jan 18, 2013, 07:31 PM

19. Kicking the can down the road, again

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Response to DemReadingDU (Reply #19)

Fri Jan 18, 2013, 10:02 PM

21. Yeah, but they blinked

that counts for something

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Response to Demeter (Original post)

Fri Jan 18, 2013, 06:23 PM

9. Traditional social stratification Amongst the Imazaghan

Traditionally, Tuareg society is hierarchical, with nobility and vassals. Each Tuareg clan (tawshet) is made up of several family groups, led by their collective chiefs, the amghar. A series of tribes tawsheten may bond together under an Amenokal, forming a Kel clan confederation. Tuareg self-identification is related only to their specific Kel, which means "those of". E.g. Kel Dinnig (those of the east), Kel Ataram (those of the west). The position of amghar is hereditary through a matrilineal principle, it is usual for the son of a sister of the incumbent chieftain to succeed to his position. The amenokal is elected in a ritual which differs between groups, the individual amghar who lead the clans making up the confederation usually have the deciding voice.

Nobility and vassals

The work of pastoralism was specialized according to social class. Tels are ruled by the imúšaɣ (Imajaghan, The Proud and Free) nobility, warrior-aristocrats who organized group defense, livestock raids, and the long-distance caravan trade. Below them were a number of specialised métier castes. The ímɣad (Imghad, singular Amghid), the second rank of Tuareg society, were free vassal-herdsmen and warriors, who pastured and tended most of the confederation's livestock. Formerly enslaved vassals of specific Imajaghan, they are said by tradition to be descended from nobility in the distant past, and thus maintain a degree of social distance from lower orders. Traditionally, some merchant castes had a higher status than all but the nobility among their more settled compatriots to the south. With time, the difference between the two castes has eroded in some places, following the economic fortunes of the two groups.

Imajaghan have traditionally disdained certain types of labor and prided themselves in their warrior skills. The existence of lower servile and semi-servile classes has allowed for the development of highly ritualised poetic, sport, and courtship traditions among the Imajaghan. Following colonial subjection, independence, and the famines of the 1970s and 1980s, noble classes have more and more been forced to abandon their caste differences. They have taken on labor and lifestyles they might traditionally have rejected.

Client castes

After the adoption of Islam, a separate class of religious clerics, the Ineslemen or marabouts, also became integral to Tuareg social structure. Following the decimation of many clans' noble Imajaghan caste in the colonial wars of the 19th and 20th centuries, the Ineslemen gained leadership in some clans, despite their often servile origins. Traditionally Ineslemen clans were not armed. They provided spiritual guidance for the nobility, and received protection and alms in return.

Inhædˤæn (Inadan), were a blacksmith-client caste who fabricated and repaired the saddles, tools, household equipment and other material needs of the community. They were often, in addition to craftwork, the repository of oral traditions and poetry. They were also often musicians and played an important role in many ceremonies. Their origins are unclear, one theory proposing an original Jewish derivation. They had their own special dialect or secret language. Because of their association with fire, iron and precious metals and their reputation for cunning tradesmanship the ordinary Tuareg regarded them with a mixture of awe and distrust.

Tuareg peasants

The people who farm oases in Tuareg-dominated areas form a distinct group known as izeggaghan (or hartani in Arabic). Their origins are unclear but they often speak both Tuareg dialects and Arabic, though a few communities are Songhay speakers. Traditionally they worked land owned by a Tuareg noble or vassal family, being allowed to keep a fifth part of their produce. Their Tuareg patrons were usually responsible for supplying agricultural tools, seed and clothing.

Bonded castes and slaves

Like other major Ethnic groups in West Africa the Tuareg once held slaves (éklan / Ikelan in Tamasheq, Bouzou in Hausa, Bella in Songhai). The slaves called éklan once formed a distinct social class in Tuareg society. Eklan formed distinct sub-communities; they were a class held in an inherited serf-like condition, common among societies in precolonial West Africa.

When French colonial governments were established, they passed legislation to abolish slavery, but did not enforce it. Some commentators believe the French interest was directed more at dismantling the traditional Tuareg political economy, which depended on slave labor for herding, than at freeing the slaves. Historian Martin Klein reports that there was a large scale attempt by French West African authorities to liberate slaves and other bonded castes in Tuareg areas following the 1914–1916 Firouan revolt. Despite this, French officials following the Second World War reported there were some 50,000 "Bella" under direct control of Tuareg masters in the Gao–Timbuktu areas of French Soudan alone. This was at least four decades after French declarations of mass freedom had happened in other areas of the colony. In 1946, a series of mass desertions of Tuareg slaves and bonded communities began in Nioro and later in Menaka, quickly spreading along the Niger River valley. In the first decade of the 20th century, French administrators in southern Tuareg areas of French Sudan estimated "free" to "servile" Tuareg populations at ratios of 1 to 8 or 9. At the same time the servile "rimaibe" population of the Masina Fulbe, roughly equivalent to the Bella, made up between 70% to 80% of the Fulbe population, while servile Songhai groups around Gao made up some 2/3 to 3/4 of the total Songhai population. Klein concludes that roughly 50% of the population of French Soudan at the beginning of the 20th century were in some servile or slave relationship.

While post-independence states have sought to outlaw slavery, results have been mixed. Traditional caste relationships have continued in many places, including the institution of slavery. According to the Travel Channel show, Bob Geldof in Africa, the descendants of those slaves known as the Bella are still slaves in all but name. In Niger, where the practice of slavery was outlawed in 2003, a study found that almost 8% of the population are still enslaved.

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Response to Demeter (Original post)

Fri Jan 18, 2013, 06:27 PM

11. As manufacturing bounces back from recession, unions are left behind

http://www.washingtonpost.com/business/economy/as-manufacturing-bounces-back-from-recession-unions-are-left-behind/2013/01/16/4b4a7368-5e88-11e2-90a0-73c8343c6d61_story.html?wprss=rss_business

Last July was a good month for factory workers in Anderson, Ind., where a Honda parts supplier announced plans to build a new plant and create up to 325 jobs. But it was a grim month in the Cleveland suburbs, where an industrial plastics firm told the state of Ohio it was closing a plant and laying off 150 people.

Nearly all of the Ohio workers belonged to a labor union. Workers at the Indiana plant don’t. Their fates fit a post-recession pattern: American factories are hiring again, but they’re not hiring union members.

U.S. manufacturers have added a half-million new workers since the end of 2009, making the sector one of the few bright spots in an otherwise weak recovery. And yet there were 4 percent fewer union factory workers in 2012 than there were in 2010, according to federal survey data. On balance, all of the job gains in manufacturing have been non-union.

The trend underscores a central conundrum in the “manufacturing renaissance” that President Obama loves to tout as an economic accomplishment: The new manufacturing jobs are different from the ones that delivered millions of American workers a ticket to the middle class over the past half-century. It used to be that factory jobs paid substantially better than other jobs in the private sector, particularly for workers who didn’t go to college. That’s less true today, especially for non-union workers in the industry, who earn salaries that are about 7 percent lower than similar workers who are represented by a union...



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Response to Demeter (Original post)

Fri Jan 18, 2013, 06:30 PM

12. I'm so blue

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Response to Demeter (Original post)

Fri Jan 18, 2013, 06:42 PM

13. Matrilineal Culture

Tuareg women have high status compared with their Arab counterparts...The Tuareg are Islamic, but mixed with a "heavy dose" of their pre-existing beliefs including matrilineality.

Tuareg women enjoy high status within their society, compared with their Arab counterparts and with other Berber tribes: Tuareg social status is transmitted through women, with residence often matrilocal. Most women could read and write, while most men were illiterate, concerning themselves mainly with herding livestock and other male activities. The livestock and other movable property were owned by the women, whereas personal property is owned and inherited regardless of gender. In contrast to most other Muslim cultural groups, men wear veils but women do not: it may be the protection needed against the blowing sand while traversing the Sahara desert.

The most famous Tuareg symbol is the Tagelmust (also called éghéwed), referred to as a Cheche (pronounced "Shesh"), an often indigo blue-colored veil called Alasho. The men's facial covering originates from the belief that such action wards off evil spirits. It is a firmly established tradition, as is the wearing of amulets containing sacred objects and, recently, also verses from the Qur'an. Taking on the veil is associated with the rite of passage to manhood; men begin wearing a veil when they reach maturity. The veil usually conceals their face, excluding their eyes and the top of the nose. The Tuareg are sometimes called the "Blue People" because the indigo pigment in the cloth of their traditional robes and turbans stained their skin dark blue. The traditional indigo turban is still preferred for celebrations, and generally Tuareg wear clothing and turbans in a variety of colors.

Food

Taguella is a flat bread made from millet, a grain, which is cooked on charcoals in the sand and eaten with a heavy sauce. Millet porridge is a staple much like ugali and fufu. Millet is boiled with water to make a pap and eaten with milk or a heavy sauce. Common dairy foods are goat's and camel's milk, as well as cheese and yogurt made from them. Eghajira is a thick beverage drunk with a ladle. It is made by pounding millet, goat cheese, dates, milk and sugar and is served on festivals like Eid ul-Fitr and Eid al-Adha. A popular tea, gunpowder tea, is poured three times in and out of a tea pot with mint and sugar into tiny glasses.

Religion

Traditionally Tuareg practiced Animism. Following suit with the spread of Christianity, much of North Africa became Christian although paganism was still widely spread in Vandal North Africa. Then with the onset of Arabs into North Africa, Islam came in and the Tuareg travelled south and mixed their animistic beliefs with Islam.

Arts

Much Tuareg art is in the form of jewelry, leather and metal saddle decorations called trik, and finely crafted swords. The Inadan community makes traditional handicrafts. Among their products are tanaghilt or zakkat (the 'Agadez Cross' or 'Croix d'Agadez'); the Tuareg sword (Takoba), many gold and silver-made necklaces called 'Takaza'; and earrings called 'Tizabaten'.

Astronomy

The clear desert skies allowed the Tuareg to be keen observers. Tuareg stars and constellations include:

Azzag Willi (Venus), which indicates the time for milking the goats
Shet Ahad (Pleiades (star cluster)), the seven sisters of the night
Amanar (Orion (constellation)), the warrior of the desert
Talemt (Ursa Major), the she-camel
Awara (Ursa Minor), the baby camel

Nomadic architecture

While living quarters are progressively changing to adapt to a more sedentary lifestyle, Tuareg groups are well known for their nomadic architecture (tents). There are several documented styles, some covered with animal skin, some with mats. The style tends to vary by location or subgroup. Because the tent is considered to be under the ownership of a married woman (and significantly, built during the marriage ceremony), sedentary dwellings generally belong to men, reflecting a patriarchal shift in power dynamics. Current documentation suggests a negotiation of common practice in which a woman's tent is set up in the courtyard of her husband's house. Old legend says Tuareg once lived in grottoes, akazam, and then they lived in foliage beds made on the top acacia trees, tasagesaget, to avoid numerous wild animal during old times and even to this day to escape from mosquitoes.

Many Tuareg today are either settled agriculturalists or nomadic cattle breeders, though there are also blacksmiths and caravan leaders.





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Response to Demeter (Original post)

Fri Jan 18, 2013, 06:45 PM

14. Oil holds above $95, set for a weekly gain

http://www.marketwatch.com/story/oil-extends-advance-for-now-2013-01-18?siteid=YAHOOB

Crude-oil futures held their ground above $95 a barrel Friday, ready to end the week with a gain, after the International Energy Agency raised its forecast for oil demand this year and data showed that China’s economy grew more than expected in the fourth quarter.

Putting some pressure on oil, however, was a fall in U.S. consumer sentiment in January...

YA THINK?

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Response to Demeter (Reply #14)

Sat Jan 19, 2013, 08:28 AM

43. Alberta oil selling at 50% discount to world price…

http://eclecticlip.com/2013/01/18/alberta-oil-selling-at-50-percent-discount-to-world-price/

…which explains why the Canadian government is Hell-and-High-Water-bent on building a pipeline, any pipeline, anywhere.
First, the stats

Over the past few months, new stories have noted that Canada’s oil sector isn’t getting full price for its heavy oil — in large part because American pipelines are well-supplied with newly-flowing tight oil (“shale oil”) from North Dakota.

As a side note, I should clarify that heavy oil — termed Western Canada Select — is a somewhat-upgraded form of bitumen. Removing the sulfur and upgrading the oil a bit more, would turn it into the “light sweet crude” used for the world’s billion automobiles.)

Western Canada Select is more refined, and more value-added, than the diluted bitumen that Enbridge has proposed to ship to the coast of British Columbia. The Kalamazoo River spill in 2010 that added $750+ million in cleanup costs to the local economy, involved diluted bitumen (and Enbridge).


The discount on Alberta heavy oil is measured relative to the North American benchmark price, which is for West Texas Intermediate (WTI) crude. And said discount has been growing faster than a pimple before prom reaching a jaw-dropping $40 per barrel this week. WTI sells for $96 per barrel, and Alberta heavy sells for … $56.

One barrel of oil is about 160 Litres, so this means that Alberta is giving up 25 cents per litre on its oil exports. By way of comparison, the current WTI price works out to a total price of only 60 cents per litre. We’re talking some serious discounting, here. Of course, the world benchmark price is Brent crude, traded in London. And for various reasons, West Texas Intermediate Crude trades at a discount to it! I’ve taken a snapshot of the Bloomberg Energy page below; you can see that the Brent price is $112 per barrel. We see that the price of Brent crude ($112/bbl) is exactly twice as high as the price we established for Alberta heavy ($56/bbl). Alberta heavy crude is selling for half-off — it’s like a BOGO (buy one, get one) sale!



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Response to Demeter (Original post)

Fri Jan 18, 2013, 06:47 PM

15. Days Before 2007 Crisis, Fed Officials Doubted Need to Act

WELL, THAT ATTITUDE CERTAINLY HASN'T CHANGED SINCE...

http://www.nytimes.com/2013/01/19/business/economy/fed-transcripts-open-a-window-on-2007-crisis.html



WASHINGTON — Federal Reserve officials in August 2007 remained skeptical that housing foreclosures could cause a financial crisis, just days before the Fed was jolted into action, according to transcripts that the central bank published Friday.

Worries about the health of financial markets dominated a meeting of the Fed’s policy-making committee on Aug. 7, but officials decided there was not yet sufficient evidence that the problems were affecting the growth of the broader economy.

Just three days later, the Fed’s chairman, Ben S. Bernanke, convened an early-morning conference call to inform them that the central bank had been forced to start pumping money into a financial system that was suddenly seizing up. More than five years later, the system remains heavily dependent on those pumps.

“The market is not operating in a normal way,” Mr. Bernanke said on that August call, in a moment of historic understatement. “It’s a question of market functioning, not a question of bailing anybody out. That’s really where we are right now.”

The actual conversations from the Fed’s meetings are released once a year after a five-year delay. With a wealth of detail beyond the terse statements and formal minutes issued in the hours and weeks after the meetings, the transcripts provide fresh insights into the debates, actions and judgment of policy makers. ...

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Response to Demeter (Original post)

Fri Jan 18, 2013, 06:54 PM

17. I have to make dinner...Talk amongst yourselves and post something!

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Response to Demeter (Reply #17)

Fri Jan 18, 2013, 07:11 PM

18. I'll take my steak rare.

Maybe a glass of cabernet. As long as Anne D didn't stomp the grapes.

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Response to Fuddnik (Reply #18)

Fri Jan 18, 2013, 10:01 PM

20. Tonight it's spaghetti bolognese

Steak was last night.

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Response to Demeter (Original post)

Fri Jan 18, 2013, 10:29 PM

22. Tin Hinan

Tin Hinan is the name given by the Tuareg to a 4th-century woman of prestige whose monumental tomb is located in the Sahara at Abalessa in the Ahaggar or Hoggar region of Algeria. The name means literally "she of the tents", but may be metaphorically translated as "mother of the tribe" (or "of us all") or even "queen of the camp" (the "camp" maybe referring to the group of tombs which surround hers). She is sometimes referred to as "Queen of the Hoggar", and by the Tuareg as tamenoukalt which also means queen.

The tomb was opened by Byron Khun de Prorok with support from the French army in 1925, and archaeologists made a more thorough investigation in 1933. It was found to contain the skeleton of a woman on a wooden litter, lying on her back with her head facing east. She was accompanied by heavy gold and silver jewelery, some of it adorned with pearls. On her right forearm she wore 7 silver bracelets, and on her left, 7 gold bracelets. Another silver bracelet and a gold ring were placed with the body. Remains of a complex piecework necklace of gold and pearls (real and artificial) were also present.

A number of funerary objects were also found. These included a "Venus" statue in Aurignacian style (similar to the Venus of Hohle Fels), a glass goblet (lost during World War II), and gold foil which bore the imprint of a Roman coin of Constantine I issued between 308 and 324 CE. A 4th to 5th century date is consistent with carbon dating of the wooden bed and also with the style of pottery and other tomb furniture. The tomb itself is constructed in a style that is widespread in the Sahara.

An anthropological study of the remains published in 1968 concluded the skeleton was that of a woman 1.72 to 1.76 metres tall, belonging to a Mediterranean race, who had probably never had children and who was probably lame because of deformation of the lumbar and sacral areas. The body is now in the Bardo Museum in Algiers.

The Tuareg were well aware that the tomb contained a woman of prestige and a number of legends about her had long been in circulation before the tomb was opened. According to one legend, Tin Hinan was believed to have been a Muslim of the Braber tribe of Berbers who came from Tafilalt oasis in the Atlas Mountains in the area of modern Morocco accompanied by a maidservant named Takamat. In this legend, Tin Hinan had a daughter (or grand-daughter), whose name is Kella, while Takamat had two daughters. These children are said to be the ancestors of the Tuareg of the Ahaggar. Another version is that Tin Hinan had three daughters (who had totemic names referring to desert animals) who were the tribal ancestors. Her Muslim religion is anachronistic, as is the statement that Kella was her daughter or grand-daughter, because the historical figure and real tribal matriarch Kella lived during the 17th century.

The 14th century historian Ibn Khaldun recorded a legend about a lame queen named Tiski who was ancestral mother of the Ahaggar tribes, which is somewhat closer to the archaeological record.

Notes

^ The material for this article is taken from the paper by Gabriel Camps which critically examines the evidence from the archaeological and historical record.
^ Tribal genealogies show male descent until her, after which descent was reckoned in the female line. Camps, p. 516.

References

Gabriel Camps, "L'âge du tombeau de Tin Hinan, ancêtre des Touareg du Hoggar". Zephyrus, vol. 25 (1974) 497-516.
See also Brett, Michael; Elizabeth Fentress The Berbers WileyBlackwell 1997 ISBN 978-0-631-20767-2 p. 208

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Response to Demeter (Reply #22)

Fri Jan 18, 2013, 10:31 PM

23. Fictional account of Tin Hinan in the works

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Response to Demeter (Original post)

Fri Jan 18, 2013, 10:35 PM

24. Goldman Sachs CEO Lloyd Blankfein Gets 75 Percent Raise Mark Gongloff

http://www.huffingtonpost.com/mark-gongloff/lloyd-blankfein-pay-raise_b_2507012.html

Angry about your paycheck shrinking this year because the payroll tax cut expired? Well, this should cheer you right up: Goldman Sachs's CEO got a 75 percent raise this year. Lloyd Blankfein made $21 million last year, including a $2 million salary and a $19 million bonus, CNN/Money reports. That bonus includes $5.6 million in cash. Bloomberg pegs the total pay at $19 million, but what's a couple of million dollars, really? Blankfein's haul represents a 75 percent pay increase from the year before, CNN/Money notes. It is also nearly double the paltry $11.5 million that Jamie Dimon, CEO of the nation's biggest bank, JPMorgan Chase, took home.

Unlike Dimon, Blankfein's bank did not nightmarishly botch up a massive credit-derivatives trade that cost it $6 billion, as JPMorgan did (although JPMorgan still managed to turn in a record profit). Goldman Sachs's profit nearly doubled last year, and its stock price jumped 49 percent. And as we all know, Goldman Sachs does God's work, which apparently consists mainly of trading stuff as much as possible, notes CNBC's John Carney.

We know what you're thinking: Grrrr!! You may think that your job -- educating children, say, or fighting fires -- is maybe more valuable to society than Blankfein's job of fleecing muppets and moving money around until it magically turns into more money. It's not fair, you're thinking.

In fact, some of you might be thinking, maybe it's corrosive to pay so much money to people for doing nothing much more than magically turning money into more money. It might incentivize them at some point down the road to, I don't know, cram derivatives full of toxic mortgage assets and foist them on unsuspecting muppets. You know, God's work.

Can't argue with you.

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Response to Demeter (Original post)

Fri Jan 18, 2013, 10:43 PM

25. Tomorrow, we'll try to find out what the Imazaghan are up to now

but you can see that Europeans would have nothing in common, and no point of reference in their dealings with the sons of the desert.

Good night, all! Stay warm and dry!

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Response to Demeter (Original post)

Sat Jan 19, 2013, 12:53 AM

26. One of my favorite bands is from Mali and called Tinariwen

I saw them in Orlando last year or maybe the year before. They met in a refuge camp and the lead singer influenced by Hendrix.





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Response to Demeter (Original post)

Sat Jan 19, 2013, 05:39 AM

27. Caterpillar writes off most of China deal after fraud

http://news.yahoo.com/caterpillar-writes-off-most-china-deal-fraud-002503302--sector.html

Caterpillar Inc uncovered "deliberate, multi-year, coordinated accounting misconduct" at a subsidiary of a Chinese company it acquired last summer, leading it to write off most of the value of the deal and wiping out more than half its expected earnings for the fourth quarter of 2012. Shares of Caterpillar fell 1.5 percent in afterhours trading following news of the fraud, which was discovered after problems were found with the Chinese company's inventory.

Caterpillar, the world's largest maker of tractors and excavators, said on Friday it would take a noncash goodwill impairment charge of $580 million, or 87 cents per share, in the quarter. Analysts had expected the company to report $1.70 per share when it reports its results on January 28, according to Thomson Reuters I/B/E/S.

Caterpillar closed the purchase of ERA Mining Machinery Ltd and its subsidiary Siwei last June, paying HK$5.06 billion, or $653.4 million. ERA had been publicly traded in Hong Kong, doing business through Siwei, which is known for making equipment to support roofs in mines. A member of the Caterpillar board during the course of the Siwei deal told Reuters the board was distracted at the time by a larger transaction and paid relatively little attention to the Siwei acquisition. "It came as a complete surprise to us," the former board member said of the fraud, speaking on condition of anonymity because of the sensitivity of the situation. "It was presented to us as a pretty straightforward transaction. It's a shame. It should have been investigated further." The source said the driving force behind the deal was Ed Rapp, the former Caterpillar chief financial officer who now serves as a group president with responsibility for China, among other operations. The source said it was Rapp who presented the deal to the board and pushed for its completion.

... In a statement, Caterpillar said an ongoing investigation launched after the deal closed "determined several Siwei senior managers engaged in deliberate misconduct beginning several years prior to Caterpillar's acquisition of Siwei." According to a question-and-answer dialog Caterpillar included in its statement, the company found discrepancies in November between the inventory in Siwei's books and its actual physical inventory, triggering the probe. The company also said it had replaced several senior managers at Siwei, adding that their conduct was "offensive and completely unacceptable."... Representatives for Citigroup and law firm Freshfields Bruckhaus Deringer LLP, which served as financial and legal advisers to Caterpillar on the transaction, could not be immediately reached for comment. Blackstone and DLA Piper, which acted as ERA's financial and legal advisers, were not immediately available for comment...

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Response to Demeter (Reply #27)

Mon Jan 21, 2013, 10:45 AM

95. Wanna bet that Ed Rapp

gets promoted for this bad deal? It seems that even when indispensable high-level management types lose hundreds of millions of dollars, they rise even further to the top in their fields.

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Response to Demeter (Original post)

Sat Jan 19, 2013, 05:42 AM

28. Consumer sentiment at year low; fiscal debate weighs

NOBODY COULD HAVE FORESEEN THAT COMING!

http://news.yahoo.com/consumer-sentiment-hits-low-january-145754093--business.html

Consumer sentiment unexpectedly deteriorated for a second straight month to its lowest in over a year in January, with many consumers citing fallout from the recent "fiscal cliff" debate in Washington, a survey released on Friday showed. The sharp drop in sentiment over the last two months coincides with rancorous federal budget negotiations that have led to higher taxes for many Americans. Just weeks after that deal, President Barack Obama and Republican lawmakers are expected to enter another tough round of negotiations over spending cuts, which could dent consumer confidence still further.

"The handling of the fiscal cliff talks and the realization that paychecks are going to be smaller due to the sunset of the payroll tax holiday are probably weighing on consumer attitudes at the moment," said Thomas Simons, a money market economist at Jefferies & Co. in New York. While most of the scheduled tax hikes and spending cuts forming the fiscal cliff were avoided when Congress struck a deal on January 1, most U.S. workers saw their take-home salary diminished by the expiry of two percentage-point cut in payroll taxes. "With the debt ceiling yet to be tackled and more political acrimony on the way, we suspect that confidence has room to deteriorate further," Simons said.

The Thomson Reuters/University of Michigan's preliminary reading on the overall index of consumer sentiment came in at 71.3, down from 72.9 the month before. The index was at its lowest since December 2011. It was also below the median forecast of 75 among economists polled by Reuters. "The most unique aspect of the early January data was that an all-time record number of consumers - 35 percent - negatively referred to the fiscal cliff negotiations," survey director Richard Curtin said in a statement. "Importantly, the debt ceiling debate is still upcoming and could further weaken confidence," he said...

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Response to Demeter (Original post)

Sat Jan 19, 2013, 05:48 AM

29. Fed official alleges Geithner may have alerted banks to rate cut

http://news.yahoo.com/fed-official-alleges-geithner-may-alerted-banks-rate-050411052--business.html

In the summer of 2007, as storm clouds gathered over the world's financial system, then-New York Federal Reserve President Timothy Geithner allegedly informed the Bank of America and other banks about the possibility the U.S. central bank would lower one of its critical interest rates, according to a senior Fed official. Jeffrey Lacker, the head of the Richmond Fed, originally raised the allegation during a Fed conference call in August 2007, and he stuck to his 5-year-old claim against the current U.S. treasury secretary in a statement provided to Reuters on Friday.

"From conversations I had prior to the video conference call on August 16, 2007, I was aware of discussions among a few large banks about borrowing from their discount windows to support the asset backed commercial paper market," Lacker said in the statement. "My understanding was that (New York Fed) President Geithner had discussed a reduction in the discount rate with these banks in connection with these initiatives."


According to transcripts of the call released by the Fed on Friday, Geithner at the time denied that banks knew the Fed was considering cutting the discount rate. The Fed regularly releases transcripts of its policy meetings with a five-year lag. "We don't have any comment beyond the transcript," said Treasury spokesman Anthony Coley. The Treasury declined to make Geithner available to comment.

Information about any planned interest rate move by the Fed is among the most sensitive as it can have a huge impact on a range of financial markets worldwide. That was particularly the case in the summer of 2007 when there were growing concerns about financial stability as a crisis that would reach fever pitch just more than a year later began to build. Private disclosure of confidential, market-sensitive information by the central bank would be highly unusual, but it was not immediately clear if it would be illegal. It also was not clear if strict Fed internal rules governing confidential information would have been breached, or whether any internal or external investigation was mounted. Lacker made no suggestion of wrongdoing by the banks as a result of getting hold of any information.

The central bank delivered a surprise cut in the discount rate, which governs direct loans it makes to banks, the day after the call. The action spurred a big stock market rally, with the Standard & Poor's 500 Index enjoying its best gain in 4-1/2 years. In his statement to Reuters, Lacker did not say which banks may have been privy to the information, although in the transcript of the August 16, 2007, call he said he had discussed the matter with Bank of America's then CEO, Ken Lewis, earlier that day. The Richmond Fed supervises the Charlotte, North Carolina-based bank.

Spokesmen for the Federal Reserve Board in Washington, the New York Fed and Bank of America all declined to comment, as did Lewis.

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Response to Demeter (Original post)

Sat Jan 19, 2013, 07:01 AM

30. The Currency Wars: Now US Automakers Are Squealing

http://www.zerohedge.com/contributed/2013-01-18/currency-wars-now-us-automakers-are-squealing

Japan’s Liberal Democratic Party went all out late last year to re-grab the power it had held for 50 years before getting booted out in 2009. Its platform: print and borrow with utter abandon to create asset bubbles and inflation, and to weaken the yen. It even threatened to wrest control over the printing press away from the Bank of Japan. That verbiage has been phenomenally successful: the stock market is surging, and the yen is crashing from historic—under normal circumstances, inexplicable—highs....But now, US automakers are squealing. They want the government to fight back in the currency war. The American Automotive Policy Council (AAPC), a lobbying organization that represents only Ford, GM, and Chrysler, sent President Obama a letter, demanding retaliation against Japan’s NO EXIT strategy. Then it went public with it grievances.

“Here we go again,” said Matt Blunt, AAPC president and former Republican governor of Missouri. “Japan’s Liberal Democratic party is back in power and determined to repeat the ‘beggar thy neighbor’ policies that distort trade by cheapening the value of the yen to promote economic growth in Japan at the expense of its trading partners.”
He claimed that “these types of policies” had “inflicted tremendous harm” on manufacturing in the US. “We urge the Obama Administration to make it clear to Japan that such policies are unacceptable and will be met by reciprocal measures.”



The AAPC has been lambasting Japan, and rightfully so, for having “the most closed auto market in the developed world,” protected by “non-tariff barriers” that keep US automotive products out. But now it accused Japan of manipulating its currency “to boost its own exports at the expense of other nations, especially the United States.”...Alas, the biggest currency manipulator in the world is the Fed, not only with its verbiage but also with its endless and escalating waves of quantitative easing, to the point where it currently prints $85 billion a month to debase and demolish the dollar, or what is left of it, which isn’t much. It makes US wages more competitive with those in Mexico and China. It also makes imports more expensive for American consumers and exports cheaper for consumers elsewhere. Meanwhile, Japan’s infamous trade surplus has given way to a ballooning trade deficit (graph).

The automakers were whining to President Obama, ironically, as another announcement was made and received with hoopla: GM would invest $1.5 billion in plants in North America in 2013. While no further details emerged, hopes were swirling that this manna would rain down on Michigan. Yet North America, in addition to Michigan, also includes among other places Canada and Mexico, and how much of this money will land in the US is uncertain. Embarrassingly, the $1.5 billion was just a fraction of GM’s planned investments of $8 billion for 2013, of which $6.5 billion will be sent to countries outside North America—not Europe where GM is bleeding to death, but Asia. That has been the paradigm in manufacturing for decades. US corporations have invested prodigiously in China and other countries where labor is cheap and have thus contributed to their enormous economic growth, while only crumbs have fallen on US soil. In this manner, much of the US auto component industry has moved offshore.

  • Exhibit A: Delphi, formerly GM’s component division. GM spun it off in 1999. Two years later, Delphi axed 11,500 workers. In 2004, it got into hot water over its accounting practices. In 2005, it went bankrupt and closed 45 plants in the US, with much of the production moving to China. In 2009, it sold its chassis division to state-owned BeijingWest Industries, which now develops and manufactures brake and chassis components for US and European automakers.

  • Exhibit B: Visteon, formerly Ford’s component division. Always the laggard, Ford spun it off in 2000. In 2009, it went bankrupt, shuttered all but one of its 33 plants in the US, let go 25,000 workers, and shifted its center of gravity to Shanghai. It now has 171 plants and facilities in other countries. Its headquarters building in Van Buren Township, Michigan, was sold last year, though its headquarters is still officially located there. Visteon is still “a US company at this point,” CEO Tim Leuliette said at the Automotive News World Congress on Wednesday. Yet globally, he added, only “about 4%, 5% of our employees are in the United States,” most of them supporting customers in North America. So, if the headquarters shifted to Asia, he said, it wouldn’t change much, jobs-wise.

    Bitter irony: American automakers, after having sent their investments and manufacturing overseas, are using a Republican ex-governor to pressure the Obama administration to stop the Japanese from defending themselves in the currency war that the Fed has been waging relentlessly for years. MORE
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    Response to Demeter (Reply #30)

    Sat Jan 19, 2013, 07:22 AM

    35. Russia Says World Is Nearing Currency War as Europe Joins

    http://www.bloomberg.com/news/2013-01-16/russia-says-world-is-nearing-currency-war-as-europe-joins.html

    The world is on the brink of a fresh “currency war,” Russia warned, as European policy makers joined Japan in bemoaning the economic cost of rising exchange rates.

    “Japan is weakening the yen and other countries may follow,” Alexei Ulyukayev, first deputy chairman of Russia’s central bank, said at a conference today in Moscow.

    The alert from the country that chairs the Group of 20 came as Luxembourg Prime Minister Jean-Claude Juncker complained of a “dangerously high” euro and officials in Norway and Sweden expressed exchange-rate concern.

    The push for weaker currencies is being driven by a need to find new sources of economic growth as monetary and fiscal policies run out of room. The risk is as each country tries to boost exports, it hurts the competitiveness of other economies and provokes retaliation...

    THEFT BY ANY OTHER NAME...

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 07:04 AM

    31. Supreme Court to consider if silence can be evidence of guilt

    DEAR GOD, WHAT NEXT?

    http://www.reuters.com/article/2013/01/11/us-usa-court-silence-idUSBRE90A13P20130111

    The Supreme Court on Friday agreed to consider whether a suspect's refusal to answer police questions prior to being arrested and read his rights can be introduced as evidence of guilt at his subsequent murder trial.

    Without comment, the court agreed to hear the appeal of Genovevo Salinas, who was convicted of murder and sentenced to 20 years in prison for the December 1992 deaths of two brothers in Houston. Salinas voluntarily answered police questions for about an hour, but he became silent when asked whether shotgun shells found at the crime scene would match a gun found at his home. An officer testified that Salinas demonstrated signs of deception. Ballistics testing later matched the gun to the casings left at the murder scene. Salinas was charged in 1993 but evaded arrest until his capture in 2007. His first trial ended in a mistrial. At his second trial, Texas was able to introduce evidence of his silence in the police station, over his lawyer's objections. Salinas' lawyer argued that his client deserved a Fifth Amendment protection against self-incrimination, even though he had not been under arrest or read his rights under the landmark 1966 decision Miranda v. Arizona.

    Last April, the 5th U.S. Circuit Court of Appeals upheld the conviction but noted that federal appeals courts are split as to whether "pre-arrest, pre-Miranda silence is admissible as substantive evidence of guilt." Texas opposed the appeal, saying that the protection against compulsory self-incrimination is irrelevant when a suspect is under no compulsion to speak, as Salinas was because he was not under arrest and was speaking voluntarily. It also said that any error was harmless.

    A decision is expected by the end of June.

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    Response to Demeter (Reply #31)

    Sat Jan 19, 2013, 07:13 AM

    32. Florida Senate panel votes to ban spying with drones

    http://www.news-journalonline.com/article/20130115/news/130119830

    A Florida Senate panel says police should be banned from using drones to spy on citizens...A bill (SB 92) that would prohibit law enforcement agencies from gathering evidence or other information flew through the Criminal Justice Committee with a unanimous vote Tuesday...The bill also would ban government agencies from using drones for code enforcement. Sen. Joe Negron, a Stuart Republican who sponsored the bill, first agreed to some changes that made it more acceptable to police chiefs and sheriffs.

    The panel amended the bill to make exceptions to the ban for search warrants signed by judges and for certain emergencies such as fires and hostage situations. The bill also includes an exception for terrorism-related searches. Negron said the measure would balance the need for security with privacy rights.

    ...The Daytona Beach Police Department is considering using drones for police work. Chief Mike Chitwood said last year that the department is in its infancy stage with the process and conducting research on companies that make various drones, or unmanned aerial vehicles...Last month, Chitwood commented on the bill. “There certainly are legitimate concerns about infringing upon our rights, but to say we're not going to use it, I think, is very shortsighted just because of the potential for something to go wrong,” Chitwood said. “If there's great technology that could help people, why not use it?”

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 07:17 AM

    33. World Bank Slashes Global Growth Forecasts for 2013

    http://www.cnbc.com/id/100382435

    Economies around the world are still facing a struggle towards recovery, despite improved conditions in financial markets, the World Bank said Wednesday, as it sharply cut its global growth outlook for 2013....

    SAY RATHER, BECAUSE OF IMPROVED CONDITIONS IN FINANCIAL MARKETS...

    The bank, which mainly lends money at relatively low rates to developing countries, said that "real-side recovery" had yet to materialize. However, it issued a cautiously optimistic forecast for more affluent countries like the U.S. on Wednesday, and predicted "a slow acceleration in growth" between 2013 and 2015.

    World Bank economists are now forecasting growth of 2.4 percent for the global economy in 2013, from 2.3 percent in 2012. In its last forecast in June, the bank projected global growth would reach 3.0 percent in 2013...The World Bank also cut its forecast for developing countries, which last year grew at their slowest pace in a decade, to 5.5 percent in 2013 from 5.9 percent in a June forecast. It said growth in these countries should slowly pick up, reaching 5.7 percent next year and 5.8 percent in 2015. The bank projected that growth in advanced economies should reach 1.3 percent this year weighed down by spending cuts, high unemployment and weak consumer and business confidence. Growth should strengthen next year to 2 percent and 2.3 percent in 2015. The World Bank called on the developing countries it helps fund to "emphasize internal productivity-enhancing policies" to try and kickstart growth. Several key fast-growing markets, including Brazil and China, disappointed in the third quarter of 2012. World Bank economists believe that growth improved in the fourth quarter of 2012 in East Asia & the Pacific, Europe & Central Asia and South Asia; but growth slowed further in Latin America & the Caribbean. They were more confident about Europe's future after the European Central Bank pledged to do "whatever it takes" to save the region. SURE THEY WILL

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    Response to Demeter (Reply #33)

    Sat Jan 19, 2013, 07:20 AM

    34. IMF approves next tranche of bailout money to Greece

    http://www.dw.de/imf-approves-next-tranche-of-bailout-money-to-greece/a-16526826

    The International Monetary Fund (IMF) has agreed to release the next installment of bailout money to Greece. The institution deemed the debt-stricken country's reform efforts "impressive."

    The IMF executive board announced its decision late on Wednesday after a long delay drawn out by Greece's political crisis that arose from the economic recession. The next tranche scheduled to be disbursed is worth 3.24 billion euros ($4.31 billion).

    "The program is moving in the right direction, with strong fiscal adjustment and notable labor-cost competitiveness gains," Managing Director Christine Lagarde said in a statement.

    The bailout funds come from a four-year program worth 172 billion euros approved by the IMF early last year. Under the so-called Extended Fund Facility (EFF), Greece receives more in financial assistance than what it could normally borrow from the Washington-based institution. Including the tranche approved on Wednesday, Greece has thus far received 4.86 billion euros under the plan. Lagarde noted that the IMF had revised future criteria for the Greek government to continue receiving money.

    "While the program has been adjusted to take account of the deeper recession and implementation capacity, the strategy remains focused on restoring growth, competitiveness, and debt sustainability," said Lagarde. Greece must make further overhauls to its banking and taxation systems in order to reduce its debt burden and, ultimately, protect public interests, she added.


    SOUNDS LIKE THE SLAVES ARE TOTALLY SCREWED NOW

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    Response to Demeter (Reply #34)

    Sat Jan 19, 2013, 08:58 AM

    49. Greece needs more European money to help with debts, says IMF

    http://www.telegraph.co.uk/finance/financialcrisis/9811748/Greece-needs-more-European-money-to-help-with-debts-says-IMF.html

    "There is a gap according to our preliminary projections for 2015-2016" of up to "€9.5bn," Poul Thomsen, the IMF's mission chief for Greece, told a conference call.

    The EU and IMF have committed a total of €240bn in rescue loans to Greece since 2010, but with its economy entering a sixth year of recession it is still having trouble making budget ends meet, AFP reported.

    "The IMF's policy is that the programme needs to be fully financed for the 12 months ahead... What is key is that the Europeans know there is a gap and they'll have to fill it," he said.

    Meanwhile, an IMF report into Greece has concluded that "the rich and self-employed have continued to evade taxes on an astonishing scale and bloated and unproductive state sectors have seen only limited cuts". MORE

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 07:41 AM

    36. Snakes and Ladders: Investment Banking on the Brink

    http://www.spiegel.de/international/business/investment-banking-faces-massive-layoffs-and-identity-crisis-a-877710.html

    The suicide victims chose a location with symbolic significance. Last fall, only a few weeks apart, a businesswoman and a banker went to the Coq d'Argent, an upscale restaurant and hot spot in the world of London high finance, located on the top floor of a shopping complex, to end their lives.

    The woman put down her purse and jumped from the restaurant's cozy rooftop terrace. The banker, an investment specialist, jumped into the building's atrium around lunchtime.

    The "City," the casual term the financial center uses in reference to itself, was shocked. The suicides are the most glaring expression of an apocalyptic mood that seems to have gripped all of London. Hospitals are reporting a high incidence of patients with alcohol problems, while top restaurants are fighting for every customer.

    The crisis has struck at the heart of the financial center. In 2012, banks began to downsize their investment banking activities. For years, the area had been seen as a playground for those seeking instant riches and guaranteed success, and it provided tens of thousands with sometimes exorbitant incomes.

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 07:47 AM

    37. Former PP treasurer “handed out envelopes with cash” to party officials

    http://elpais.com/elpais/2013/01/18/inenglish/1358525576_044952.html

    Despite strenuous efforts by the ruling Popular Party (PP) to distance itself from Luis Bárcenas, who is in trouble with the law over corruption allegations, the party’s former treasurer continues to maintain an office in the PP headquarters in Madrid even after having left the group, party sources said Friday.

    Bárcenas is implicated in the Gürtel kickbacks-for-contracts scandal, which first broke in 2008. Under an ongoing investigation into the corruption ring, it emerged earlier this week that Bárcenas had a bank account in Switzerland in which he had deposited as much as 22 million euros. He also took advantage of a tax amnesty in place last year to declare 10 million euros, which had previously been kept hidden from the tax authorities.

    The PP sources said that despite stepping down as a senator and leaving the party in April 2010, Bárcenas has continued to appear in its Madrid headquarters, seeking help from PP officials to find a solution to the legal quagmire in which he finds himself. He was last seen in the building – located in Génova Street in the center of Madrid – as recently as Wednesday of this week.

    Bárcenas, who was treasurer of the PP for 20 years, faces possible charges of money-laundering and tax evasion.

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 07:52 AM

    38. Ex-PP treasurer Bárcenas declared 10 million euros under tax amnesty

    http://elpais.com/elpais/2013/01/17/inenglish/1358427976_005146.html


    The former treasurer of the ruling Popular Party (PP), Luis Bárcenas, declared 10 million euros in a controversial tax amnesty decreed last year by the PP government of Prime Minister Mariano Rajoy, Bárcenas’ lawyer, Alfonso Trallero, told the television channel Cuatro on Thursday.

    The tax agency, which was in charge of the amnesty, is under the direct control of Finance Minister Cristóbal Montoro. The amnesty allowed people to come clean on assets they had hidden from the taxman without questions asked by paying a fine of only 10 percent of the funds declared.

    Bárcenas and his wife are facing charges of tax fraud and of receiving illegal payments from the ringleaders of the Gürtel kickbacks-for-contracts corruption. As part of an ongoing investigation into the case, it emerged on Wednesday that Bárcenas had a bank account in Switzerland in which at one point he had deposited as much as 22 million euros.

    The tax amnesty, which was in place last year, took in only 1.2 billion euros when the government had budgeted for proceeds of 2.5 billion. The government subsequently tightened legislation against tax fraud.

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 07:57 AM

    39. It will take more than a few pop-up shops to save our high streets

    http://www.guardian.co.uk/commentisfree/2013/jan/19/save-high-streets-ian-jack


    For most goods, excluding food from superstores, few shops can hope to compete with online retailers, writes Ian Jack. Photograph: John Londei/Rex Features


    Travelling through my part of London on the top of a bus this week I saw something on the street that came from another age, surprising me almost as much as the playwright and diarist Simon Gray was surprised when, from a taxi in Holland Park Avenue, he saw "a middle-aged man in a sensible suit walking along the pavement, smoking a pipe". The year was 2005. "It gave me quite a shock," Gray wrote in the last-but-one volume of his memoirs. "He must have been the first man I'd seen for years smoking a pipe, my instinct was to shout out to him through the window to be careful, there might be a policeman about, then it struck me he might have been the victim of a time accident … go home , go back to where you came from, the 1980s, the 1970s, whenever … "

    What I saw wasn't a person but a sign. HARDWARE AND DIY STORE OPENING SOON it said, in nice, big capitals spread across the window of a narrow shop that I remember long ago was called SMOKES, and as well as cigarettes sold the kind of equipment – pipe knives, pipe cleaners, pouches of Condor ready-rubbed – that might have been in the pockets of the man Simon spotted in Holland Park. On this street, many similar shops – that is, everyday and utilitarian shops – have closed over the past 30 years, to be replaced by restaurants, cocktail bars and emporia for all sorts of little luxuries, from lemon and polenta cake to retro toys made of tin. A new little shop selling drain cleaner, broomsticks and floor sanders must surely be bucking every retail trend, even though hardware stores, formerly known as ironmongers, tend to survive in high streets long after bakers, greengrocers and butchers have been swept away. Perhaps that's because ironmongers have always been the A&E of shops – a blocked drain or a popped light bulb needing a more urgent remedy than a rotten sausage.

    But it wasn't just odd to see such a sign; it was even odder to be slightly uplifted by it. Shops were until recently such a familiar and unexamined part of every townscape, and in childhood memory – at least of boys accompanying their mothers – places that brought on boredom and impatience. There were so many of them. The village I grew up in, which contained not many more than 1,000 people, was served by nearly a dozen shops, including a butcher's, a wool shop, a post office, a licensed grocer's with a sad-looking display of Keystone Burgundy bottles, and a sweetshop that was really no more than a tray of toffees that Mrs Fraser had placed in the window of her front room.

    Every essential, with the exceptions of medicine, clothes and footwear, could be bought in the village, though villagers, including my mother, would take the bus to the nearest town once a week and return with two shopping bags filled mainly with baked goods and tins. The buses ran frequently and the shops in town, especially the several-storey co-op, were more inviting in the variety and quality of their stock. Consequently most village shops had closed by the early 1960s, and by the turn of the century only a post office and a general store endured. At first, the benefit went to the town, but then in the 1980s the town, too, began to de-shop itself by developing a parade of chainstores on its outskirts, where parking was easy, and then allowing superstores to be built near the motorway.



    *** i am opposed to Sameness -- which is all that big box stores can ever bring us.
    they spell the end of both small producers and retailers.

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 08:02 AM

    40. Frank Sinatra - My One And Only Love

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 08:09 AM

    41. Inquiry into Greek 'austerity architect'

    http://www.irishtimes.com/newspaper/world/2013/0119/1224329046633.html

    Greek politicians launched an inquiry yesterday into allegations of misconduct by George Papaconstantinou, the former finance minister and architect of the country’s first austerity programme.

    Greek MPs voted overwhelmingly to investigate Mr Papaconstantinou after claims that he not only failed to crack down on tax evasion but erased relatives’ names from a list of people with holdings in the Geneva branch of HSBC. The economist faces prosecution – and jail – if, on the basis of their findings, investigators decide by the end of February to try him.

    The politician vehemently denied the charges. “I did not tamper with the data. It is inconceivable that I would have acted in such a way that would so blatantly involve me,” he said in a speech to the house.

    The list, a dossier of more than 2,000 Greeks with accounts in Geneva, was first handed to Mr Papaconstantinou in late 2010 by the then French finance minister, Christine Lagarde.

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 08:23 AM

    42. Senator Asks CIA Nominee When Drones Can Kill Americans By Spencer Ackerman

    http://www.wired.com/dangerroom/2013/01/wyden-brennan/

    The man in charge of America’s drone wars will face Senate questioning about perhaps their most controversial aspect: when the president can target American citizens for death. ONE WOULD HOPE THE ANSWER WAS "NEVER", BUT THAT'S SO RULE-OF-LAW!

    Sen. Ron Wyden (D-Ore.) sent a letter on Monday to John Brennan, the White House’s counterterrorism adviser and nominee to be head of the CIA, asking for an outline of the legal and practical rules that underpin the U.S. government’s targeted killing of American citizens suspected of working with al-Qaida. The Obama administration has repeatedly resisted disclosing any such information about its so-called “disposition matrix” targeting terrorists, especially where it concerns possible American targets. Brennan reportedly oversees that matrix from his White House perch, and would be responsible for its execution at CIA director. “How much evidence does the President need to determine that a particular American can be lawfully killed?” Wyden, a member of the Senate intelligence committee, asks in the letter, acquired by Danger Room. “Does the President have to provide individual Americans with the opportunity to surrender before killing them?”

    Wyden’s questions about the targeted-killing effort get specific. He wants to know how the administration determines when it is “not feasible” to capture American citizens suspected of terrorism; if the administration considers its authority to order such killings inherent in its Constitutional war powers or embedded in the 2001 Authorization to Use Military Force; and if the intelligence agencies can “carry out lethal operations inside the United States.” Wyden also expresses “surprise and dismay” that the intelligence agencies haven’t provided him with a complete list of countries in which they’ve killed people in the war on terrorism, which he says “reflects poorly on the Obama administration’s commitment to cooperation with congressional oversight.”

    Thus far, senators on the intelligence panel have been more concerned about Brennan’s possible role in national-security information leaks and the CIA’s post-9/11 torture program than in using Brennan’s nomination to peer into the decision-making surrounding Obama’s counterterrorism strikes. Wyden writes that it is “critically important” for Congress to understand “how the executive branch understands the limits and boundaries of this authority.”

    MORE

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 08:36 AM

    44. The Trillion Dollar Coin: Joke or Game-Changer? By Ellen Brown, Web of Debt

    http://www.truthdig.com/report/item/the_trillion_dollar_coin_joke_or_game-changer_20130118/

    ...For centuries, a secret battle has raged over who should create the nation’s money supply – governments or banks. Today, all that is left of the US Treasury’s money-creating power is the ability to mint coins. If we the people want to reclaim that power so that we can pay our obligations when due, the Treasury will need to mint more than nickels and dimes. It will need to create some coins with very large numbers on them.

    To bail out the banks, the Federal Reserve, as head of the private banking system, issued over $2 trillion as “quantitative easing,” simply by creating the money on a computer screen. Congress, the White House, and the Treasury all rolled over and acquiesced. When it was proposed that the government bail itself out of its budget woes by minting a $1 trillion coin, the Federal Reserve said it would not accept the Treasury’s legal tender. And the White House again acquiesced, evidently embarrassed to have entertained this “ludicrous” alternative. Somehow we have come to accept that it is less silly for the central bank to create money out of thin air and lend it at near zero interest to private commercial banks, to be re-lent to the public and the government at market interest rates, than for the government to simply create the money itself, debt- and interest-free. The banks obviously have the upper hand in this game; and they’ve had it for the last 2-1/2 centuries, making us forget that any other option exists. We have forgotten our historical roots. The American colonists did not think it was silly when they escaped a grinding debt to British bankers and a chronically short money supply by printing their own paper scrip, an innovative solution that allowed the colonies to thrive.

    In fact, the trillion-dollar coin represents one of the most important principles of popular prosperity ever conceived: national debt-free money creation. Some of our greatest leaders, including Benjamin Franklin, Thomas Jefferson, and Abraham Lincoln, promoted the essential strategy behind it: that debt-free money offers a way to break the shackles of debt and free the nation to realize its full potential. We have lost not only the power to create our own money but the memory that we once had that power. With the help of such campaigns as Occupy Wall Street, Strike Debt, and the Free University, however, we are starting to re-learn the great secret of money: that how it gets created determines who has the power in society — we the people, or they the bankers.

    It is no secret who has that power today. In the great bailout of 2008, banks were rewarded for making irresponsible and fraudulent gambles in the subprime mortgage scandal, with no one serving time in jail. Then there was the robosigning scandal, in which banks committed criminal fraud and came away with a slap on the wrist. Now we are seeing the LIBOR scandal unfold. While a commoner might get 10-20 years for robbing a bank, bank executives get huge bonuses for robbing us. We may rail against the banks and demand change, but nothing will change until we grasp their fundamental secret, the foundation of their power: that those who create the nation’s money control the nation. By mechanisms explained elsewhere, nearly the entire money supply today is created by banks...We have a chance today to end the charade of big money gridlock politics, as well as the reign of the big banks. We have the power to choose prosperity over austerity. But to do it, we must first restore the power to create money to the people.

    **********************************************************

    Ellen Brown is an attorney and president of the Public Banking Institute. In Web of Debt, her latest of eleven books, she shows how a private banking oligarchy has usurped the power to create money from the people themselves, and how we the people can get it back. Her book The Buck Starts Here: Restoring Prosperity with Publicly-owned Banks will be released this spring. Her websites are http://WebofDebt.com, http://EllenBrown.com, and http://PublicBankingInstitute.org.

    MORE--A MUST READ AND BOOKMARK PIECE!

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    Response to Demeter (Reply #44)

    Sat Jan 19, 2013, 08:43 AM

    45. MMT and Social Norms By J. D. Alt

    http://neweconomicperspectives.org/2013/01/mmt-and-social-norms.html

    Chris Hayes’ recent MSNBC show on the Trillion Dollar Coin brought four aspects of the Modern Money debate, for me at least, into a clearer focus. I list them here not in their order of appearance on the show, but in their order of importance and logical connection.

    1. The first aspect is structured by Stephanie Kelton’s remarks that yes, indeed, there are very REAL constraints on what the federal government can spend, but those constraints are not on the FINANCIAL side (whether or not the government has “enough money” to spend) but, instead, are on the RESOURCE side—whether the labor, materials and manufacturing capacity are actually there to be put to work by the proposed sovereign spending...This, I believe, is the central truth of MMT that people are trying to understand and wrap their minds around. In framing it this way, Dr. Kelton takes the focus OFF the idea of “printing money” and puts it instead on the idea of employing people to create useful goods and services. This is a shift in focus that I think serves the goals of MMT well, and there ought to be a concerted effort to continue framing this message.

    2. The second aspect is revealed in Chris Hayes’ remarks about social norms (in his intro piece). We like to think of our society as being held together by the rule of law. In reality, however, while laws may form the structural skeleton of the beast, it is “non-articulated” social norms that form the living tissue, muscle and sinew that cling to the bones. Social norms change, but they change slowly, over time—they do NOT, by their nature, change “all at once.” Clearly, it is a social norm that will not allow the Trillion Dollar Coin to be considered as a plausible solution to the national debt—and which necessitated so much giggling on the show. Legal or not, economy-saving or not, minting trillion dollar coins is NOT how our society pays its bills. Any shift in this social norm has to be very incremental. In this regard it is reasonable to consider that Obama’s position on the debt ceiling debate is exactly what it should be: he is insisting that the social norm be maintained. This might also be a guide to MMT advocates as well: It may, in fact, set the cause back to propose or insist on a dramatic shift in the norm. It may well be more effective to propose, instead, very incremental shifts that people can logically buy into without sensing a threat to the underlying social fabric. Dr. Kelton’s focus on the practical idea of employing people to create useful goods and services, it seems to me, could fit well with this incremental approach.

    3. The third aspect is Joe Weisenthal’s potent description of how inflation is driven into the economy. This dovetailed logically with Dr. Kelton’s fundamental truth about constraints being on the RESOURCE side of the equation: If the labor, materials and manufacturing capacity are not actually there to absorb the new spending, that spending could be expected to cause inflation and, therefore, ought to be withheld. By the same token, however, if the resources DO exist to absorb the proposed spending, the result will not be inflation but rather a growing of the economy and an expansion of national assets; in that case, in could be argued, to withhold the spending is indefensible.

    4. The fourth aspect is reflected in Chris Hayes’ remarks about the “moral subtext” of the debt and deficit debate. He very entertainingly imagines the nation as going crazy, worshiping the golden calves of profligate spending, and then Moses comes down the mountain calling on everyone to “get good again.” And that means paying your debts and living within your means. This is a very powerful message to the religious psyche that permeates our cultural norms. It can only be countered by explaining WHY, in fact, the sovereign government is in debt (see item no. 5 below) and making clear, over and over, Dr. Kelton’s point that the “means” we have to live within are not FINANCIAL means but, rather, RESOURCE means...Moral hazard also plays into the fears about “printing money” to pay American citizens entitlements for “doing nothing”—creating a nation of lazy dependents who don’t have the motivation to go out and find work. Again, Dr. Kelton’s framing of the MMT strategy as NOT being about paying for welfare and entitlements, but INSTEAD being about employing people to create useful goods and services, can potentially deflect these “moral hazard” fears.

    5. I’d like to add a fifth aspect which was not directly discussed by the panel: Explaining WHY the U.S. sovereign government has a debt of $16 trillion and growing. The common understanding, stated in article after op-ed with off-handed carelessness, is that when the federal government spends more dollars than it collects in taxes it HAS to borrow the difference from the bond market. Hence, out-of-control profligate spending is WHY the debt continues to grow so large. This seems as common-sense-irrefutable as 2 + 2 = 4.

    This, of course, brings us full circle because the true answer, which the American citizen must somehow be made to see, is that the sovereign government—if it chose to do so—could simply “issue” the fiat-currency required for any sovereign spending over and above tax collections; in other words, it does not HAVE to borrow the dollars from the bond market. Why does it then? It can only be because the bond market, itself, has influenced Congress to REQUIRE the sovereign government to borrow. And that is the reason the national debt continues to grow.

    “Issuing” currency (rather than borrowing in the bond market) to pay for sovereign spending over and above what is collected in taxes might be one of those things that could be done incrementally. Instead of threatening the institutional and social norms of the bond market with total annihilation, MMT could propose that sovereign spending be “monetized” only on a limited basis, to accomplish certain specific and special goals that would strengthen and benefit the nation as a whole. Over time, as people saw the benefits of monetized sovereign spending—and became assured it did not, if properly managed, lead to inflation—the social norm would likely shift. If that happened, the next time Chris Hayes had a panel discussion about the national debt, there wouldn’t have to be so much giggling.

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 08:48 AM

    46. Is Jack Lew A Friend to Wall Street?

    HE COULD BE A CAPTIVE, LIKE THE REST OF THE 99%...

    http://nationaljournal.com/whitehouse/is-jack-lew-a-friend-to-wall-street-20130110

    Like Tim Geithner, the new Treasury nominee may owe his views to Robert Rubin. So don't expect him to pursue much in the way of bank reform...It was a little noted event when last fall, during the height of the presidential election campaign, the Treasury Department released Timothy Geithner’s phone records. To the extent anyone paid attention at all—and let’s face it, almost no one did—financial reporters were struck that the Treasury secretary’s most frequent contact was Larry Fink of BlackRock, the world’s largest money manager and Geithner’s principal conduit to his many friends on Wall Street. But the even more telling name of Geithner’s regular confidants, as the Financial Times noted, was the second one on the frequent-contact list: Robert Rubin.

    That might seem odd; after all, it’s been nearly a decade and a half since Geithner worked for Rubin, who is long retired from public life. But Bob Rubin was no ordinary employer. The former Treasury secretary under Bill Clinton all but created Timothy Geithner as we know him today, raising him from a junior Tokyo Embassy staffer to undersecretary of the Treasury in the mid-to-late-’90s, and later sponsoring the still-boyish bureaucrat as president of the New York Fed in 2003 (against resistance from the head of the search committee, Paul Volcker, who according to The Wall Street Journal barked: “Who’s Geithner?”). As he almost always has, Rubin prevailed, and for nearly four years his former protégé has lorded over America’s financial system.

    Rubinomics: It’s the cult that never quits. Now the nation is faced with a potential new acolyte. Is Jacob Lew, who is expected to be named Thursday as the replacement for Geithner, yet another Rubinite who will largely follow the policies of his predecessor? Calm, brilliant, competent at everything he’s tried—from the Office of Management and Budget to deputy secretary of State to chief of staff—Lew has smoothly run the White House in the year since William Daley left. He has a reputation for unimpeachable integrity and total honesty, as well as a mastery of the budget that will be critical over the next four years of fiscal fights. But many critics fear that the picture is different when it comes to Wall Street. On financial reform, Lew is a virtual cipher who, in his few public pronouncements, has appeared to toe the Rubin-Geithner line of minimal interference with America’s giant banks. And Lew is taking over as Treasury secretary at a critical time. Two and a half years after enactment, the Dodd-Frank financial law is still not fully implemented. Even as the winds of financial turbulence threaten from Europe, financial-industry officials admit the Federal Deposit Insurance Corp. has not developed the capacity to liquidate banks in the event of a crisis. Although it never became a 2012 campaign issue, financial regulation has lagged well behind schedule (no one even seemed to care, for example, when Mitt Romney failed to propose an alternative to Dodd-Frank, even though he had promised to do so). Wall Street’s lobbyists have managed to delay the “Volcker Rule” —the closest thing we have today to a Glass-Steagall law separating federally insured commercial banking from risky investment banking—by six months. The banks are also engaged in a behind-the-scenes effort to escape U.S. oversight of their derivatives activities overseas.

    Into this den of super-sophisticated—and savage—lions of finance will walk the gentle-mannered figure of Jack Lew, who is expected to be easily confirmed. Hopes for change—any real progress in containing the power and systemic size of the banks—are not high. “By going with Jack Lew, Obama is making the decision: ‘I don’t want a fight over Treasury secretary. I want someone who’s going to maintain the status quo.’ That’s what Jack Lew represents,” says Jeff Connaughton, who as a senior Senate staffer fought for financial reform and later, in despair, wrote a book titled Wall Street Always Wins.

    A Brief History of Rubinomics SEE LINK

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 08:50 AM

    47. Musical Interlude

    Blue Money by Van Morrison:



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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 08:54 AM

    48. Judge: Govt Must Prove Manning Wanted to 'Aid Enemy'

    WELL, THAT WOULD BE A SHORT TRIAL AND A BLUNT DISMISSAL OF CHARGES...

    https://www.commondreams.org/headline/2013/01/16-10

    A military judge ruled Wednesday that in order to convict Bradley Manning of the most serious charge he faces—aiding the enemy—the government must prove that he knew or should have known that the documents he's accused of releasing would be seen by al-Qaida members.

    Bradley Manning's defense attorney argued at Wednesday's pretrial hearing that the government should drop all charges against his client because he has been denied his right to a speedy trial. When his court martial begins on June 3, he will have been detained 1,101 days. Col. Denise Lind also ruled that Manning's defense lawyers can present evidence that that he purposely selected documents that he knew would not harm the country.

    Manning, 25, is accused of handing over about 250,000 diplomatic cables and war logs from Afghanistan and Iraq to WikiLeaks, including video of a US military helicopter killing a dozen civilians.

    At approximately 2 p.m. Wednesday, Kevin Gosztola of Firedoglake tweeted, "Thus far, govt has presented no evidence #Manning knew of some kind of alliance, cooperation or ties between WikiLeaks & Al Qaeda."

    MORE

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 08:59 AM

    50. Doctor's Orders!

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 09:21 AM

    51. No plastic for the Pope

    http://www.economist.com/blogs/schumpeter/2013/01/banking-and-vatican

    SINCE the beginning of the new year, tourists in Rome who want to visit the Sistine Chapel and see the papal art collections have had to put up with some unholy complications. At the end of a tedious hike from Saint Peter's square and often lengthy queuing alongside the Vatican's walls, they are being told that they cannot pay with credit or debit cards. Those without €16 ($21) in cash for an adult ticket have to walk ten minutes to the nearest bank with an ATM. (Cash dispensers in Vatican City are, incidentally, unique in providing the option of instructions in Latin.) The refusal is the result not of a papal edict banning electronic payments, but of a decision by Italy’s central bank, which doubles as the country’s banking regulator. Payment services in Vatican City have been provided by the Italian arm of Deutsche Bank since 1997, but it did so with out the necessary authorisation. So the Bank of Italy told it to stop processing the payments. It even refused Deutsche’s request for a moratorium.

    The reason for central bank's tough stance is that it has to comply with the European Union’s banking and anti-money-laundering law. This law permits EU banks to operate in non-EU countries only if these have adequate regulatory frameworks and supervisory controls in place. Brussels keeps a list of countries that are considered to satisfy requirements, and the Vatican is not on it. In July Moneyval, an international body that assesses anti-money-laundering systems, decided that the Vatican's was not up to snuff—the Istituto per le Opere di Religione (IOR), the Vatican's bank, has yet to clean up its reputation. The Bank of Italy says that it has been trying to make all banks operating in Italy aware of the situation. “Banking business conducted by IOR cannot benefit from the simplified controls for which EU banks are eligible,” it notes on its website.

    Nobody knows how long the Vatican’s retail business with the outside world will remain cash-only (the interruption also affects the Holy See’s pharmacy, which is much used by ordinary Romans). Fortunately, pilgrims need not worry, at least until November 21st. This date marks the end of the Annus Fidei, the year of faith, during which they can visit the Vatican for nothing. And no earthly power will be able to stop them: instead of cards or cash, they just have to show a document issued by a parish or other ecclesiastical authority attesting to their pilgrimage.

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 10:09 AM

    53. Reality is a Stern Master--See you all later, I hope

    If not, send out the rescue dogs...

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    Response to Demeter (Original post)

    Sat Jan 19, 2013, 02:03 PM

    55. Musical Interlude II

    Blue Sky by The Allman Brothers Band:



    (Always puts a smile on my face)

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    Response to Demeter (Original post)

    Sun Jan 20, 2013, 01:38 AM

    56. Speaking of pirates...



    Dell: From PC King to Buyout Fodder

    ...
    Silver Lake Partners was in discussions Tuesday with Dell for a leveraged buyout at around $13 to $14 a share, according to a person familiar with the matter. The buyout group would include the private-equity firm, at least one other investor such as a pension or sovereign wealth fund, and Mr. Dell, this person said.
    Timeline: Dell's Ups and Downs
    ...
    In an LBO, an investor group finances the purchase of a company mostly with debt; the borrowings ultimately are repaid with funds generated by the company's operations or the sale of its assets.
    ...
    The group would also use some cash on Dell's balance sheet, while taking on new debt of about $15 billion, to meet an equity purchase price of roughly $22 billion to $25 billion. The person said advisers are trying to bring the negotiations to a close quickly, either way.

    Behind the possibility of a buyout is the fact that Dell's market capitalization, which once topped $100 billion, had shriveled to about $19 billion before news of the talks broke, as the company's business—and the broader PC market—shifted and slowed.

    Here.

    So business is going downhill, but Silver Lake can find someone with a few billion to invest, borrow $15 billion against a slowing future business, put every asset those people have worked for for years at risk, and insure really nice paychecks for themselves without doing any of the labor that creates the income.

    Junk bond purveyors.

    >> "...who attack to loot and pillage the goods and populations...".

    Wonder what other assets provided by those who did the work there are for them to plunder?

    If we can secure weapons, can we then ban people who are not invested in companies from playing with the lives of millions of others just because they can borrow some money they will never be held responsible for?

    Or maybe just limit it to three, instead of a drum magazine of a hundred of these bastards?

    Silver Lake
    Silver Lake in the Community (Copied from their web page - should make mothers take their kids home).
    FIRM OVERVIEW
    Founded in 1999, Silver Lake is a global private investment firm with approximately $14 billion in assets under management. With offices in Menlo Park, New York, London, San Francisco, Hong Kong and Tokyo, Silver Lake employs over 90 investment professionals across its strategies. The firm's investing strategies derive from specialization in four primary areas:

    Silver Lake Partners – Large Cap Technology
    Silver Lake Sumeru – Middle Market Technology
    Silver Lake Credit – Debt Investing
    Silver Lake Kraftwerk – Energy and Resource Innovation

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    Response to jtuck004 (Reply #56)

    Sun Jan 20, 2013, 07:17 AM

    57. Not heard of Silver Lake


    Sounds like more Bain-type investors where they 'harvest' a brand-name company for lots of profits then allow it to go bankrupt.

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    Response to DemReadingDU (Reply #57)

    Sun Jan 20, 2013, 01:20 PM

    67. Yup. There's a whole list of those black-hearted creatures... n/t

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    Response to Demeter (Original post)

    Sun Jan 20, 2013, 09:19 AM

    58. Friends, I have no heat, and it's 17F

    I found out when I returned from throwing the Sunday paper that my furnace had stopped working.

    If I get it warm in here, I will start posting again.

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    Response to Demeter (Reply #58)

    Sun Jan 20, 2013, 09:54 AM

    59. I hope you get it working fast.

    Mine went out about a year ago, during our coldest night of the year (which was only about 32 degrees).

    Beware of vultures! I called two companies out to check it out. The first charged me $39 to try to sell me a new $1500 heat pump. The second fixed it for less than $300. And it still works.

    Good luck.

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    Response to Demeter (Original post)

    Sun Jan 20, 2013, 10:48 AM

    60. France looking at new ways to tax multinational online companies

    http://www.irishtimes.com/newspaper/finance/2013/0119/1224329044248.html


    The move comes amid growing scrutiny in France of web companies that funnel revenue from their operations here through low-tax regimes such as Ireland and Luxembourg.

    Proposing an overhaul of the French tax system for online firms, the study by two senior officials at the finance ministry, published yesterday, says the state should shift its focus to user data, “the principal raw material that feeds the digital economy”.

    Targeted

    Google, Facebook and other firms offer free services to users and then sell targeted advertising to companies based on the size and the make-up of their audiences, the report notes. Since large web companies pay little tax in France on the sale of advertising, however, the taxation system should target the valuable data those companies receive free-of-charge thanks to the “collaboration” of internet users.

    Whereas online firms can avoid tax on advertising sold in France by declaring this revenue overseas, the proposed new model would allow France to focus on information contributed by users based in France.

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    Response to Demeter (Original post)

    Sun Jan 20, 2013, 10:49 AM

    61. any word about your heat? nt

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    Response to xchrom (Reply #61)

    Sun Jan 20, 2013, 11:21 AM

    64. I've vented the dryer into the house (electric)

    and caught up on laundry, baked dessert, cooked spaghetti, run the dish washer...got the downstairs up to 60F. Still waiting on a service call...

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    Response to Demeter (Reply #64)

    Sun Jan 20, 2013, 12:38 PM

    65. Brrrr


    Do you have a space heater you can move from room to room to keep warmer?


    I remember a few years ago, our heat went out. I was ready to move into the doghouse that was warmer than my house.


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    Response to Demeter (Original post)

    Sun Jan 20, 2013, 10:53 AM

    62. Spanish banks and property struggle as bad loans hit high

    http://www.irishtimes.com/newspaper/finance/2013/0119/1224329045601.html


    As Spain prepares for the approval of the second tranche of its financial rescue package and the arrival of an IMF delegation to oversee the sector’s restructure, new figures show how banks and property are struggling to emerge from a crippling crisis.

    On January 28th the EU is expected to sign off on the release of €1.9 billion for Spain’s banks, following an injection of €37 billion in December. In theory this will complete a rescue for the sector that Spain originally requested in June, as many of its lenders struggled under the weight of toxic real-estate assets.

    Figures released by the Bank of Spain yesterday showed how those assets are still burdening lenders. Bad loans reached 11.4 per cent of debts in November, a new record high, although the month-on-month increase had slowed. Bad loans have been increasing monthly since June 2011 and total €192 billion.

    “Until Spain starts creating employment it’s hard to see how it will start reducing that number ,” said Javier Díaz-Giménez of IESE business school, pointing to a jobless rate of more than 25 per cent.

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    Response to Demeter (Original post)

    Sun Jan 20, 2013, 11:12 AM

    63. Curtis Mayfield - People Get Ready

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    Response to Demeter (Original post)

    Sun Jan 20, 2013, 01:07 PM

    66. Musical Interlude III

    Between The Devil And The Deep Blue Sea by George Harrison:







    Thanks, X. Loves me some Curtis Mayfield!

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    Response to Demeter (Original post)

    Sun Jan 20, 2013, 01:27 PM

    68. The heat is back

    and while he was here, the nice man fixed the central humidifier, too. All for $335, a cup of instant coffee, 4 cookies and 2 clementines. And a jump for his truck (he left his lights on) and I had to talk him in (from Livonia) since his GPS is not good in Ann Arbor...

    oh, well. It was only my Xmas tip money....you should have seen the dirty look the older cat gave me when I came home to 55F. She had burrowed into the bedcovers, and cats NEVER do that!

    Now I can take some of the clothes I wore on the route off...

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    Response to Demeter (Reply #68)

    Sun Jan 20, 2013, 02:47 PM

    69. yay!


    Nice that everyone is warm and toasty again

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    Response to Demeter (Reply #68)

    Sun Jan 20, 2013, 05:10 PM

    70. Cats sure do communicate... when they want to. n/t

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    Response to Demeter (Original post)

    Sun Jan 20, 2013, 07:26 PM

    71. The Weekend Continues HERE on MONDAY

    Markets are closed, schools are closed, lots of juicy gossip....er, financial data in the hopper to post....I'm just too tired and in too much pain tonight. See you tomorrow!

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    Response to Demeter (Original post)

    Mon Jan 21, 2013, 06:52 AM

    72. What Is Driving Growth in Government Spending? By NATE SILVER

    WAR AND CRONY CAPITALISM: GUNS FOR THE PLEBES, BUTTER FOR THE ARISTOS

    http://fivethirtyeight.blogs.nytimes.com/2013/01/16/what-is-driving-growth-in-government-spending/?ref=politics

    The first chart, below, documents the growth in federal government spending over the past hundred years as a share of gross domestic product spending is broken down into four major categories:

    1. Entitlement programs, under which I classify government expenditures on health care programs; pensions and retirement programs like Social Security; and welfare or social insurance programs like food stamps and unemployment compensation.
    2. Military spending
    3. Interest on the national debt
    4. Infrastructure and services, under which I include everything else — the pot that is often referred to as discretionary spending: education spending; fire services, police and the criminal justice system; spending on physical infrastructure including transportation; spending on science, technology, and research and development; and the category called “general government,” which largely refers to the cost of maintaining the political system (like salaries for public officials).

















    MORE WORDS AT LINK

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    Response to Demeter (Original post)

    Mon Jan 21, 2013, 07:02 AM

    73. Looking for rent-seekers in all the wrong places

    http://www.macrobusiness.com.au/2013/01/looking-for-rent-seekers-in-all-the-wrong-places/

    Professor Paul Frijters recently wrote about the role of economists in the fight against rent-seeking.

    The search for more privilege is normal but, in order to have a healthy society, so must there be a perennial fight against it for otherwise the privileged end up lording over the rest who just have to grin and bear their inferior status. And if any profession is tasked with thinking about how to tackle privilege, it is economists. It is one of the good things we do.

    It’s a noble cause, and one that I support. Having been involved on both sides of the market for political influence – property developers on one side, and government departments and regulatory bodies on the other – I feel I have gained a certain perspective on this issue that doesn’t quite resonate with the mainstream economic view.

    From the comments it is quite clear that economists generally support the idea of a ‘fair go’ for all, and to cut back rent-seeking privileges wherever possible. But unfortunately, as I have mentioned many times, mainstream economics has no accepted model of economic rents in a market economy. Rents are always a result of market failures, regulatory capture, or some kind of other favourable regulation. If the market was perfect, economic rents would evaporate.

    This theoretical baggage is not helpful. Funnily enough, it leads to a focus on government as a breeding-ground of rent-seeking, since perfect markets eliminate any such activity – at least in their model.

    A proper starting point would acknowledge that economic rents are generated at all times by productive activity. Each time we improve output per unit of a particular input, and that input is fixed, owners of that input gain an economic rent.

    Land is the obvious focus for the study of rents. But consider the same concept in a slightly more abstract setting – time. Without saying it explicitly, when we talk about economic growth and output we usually mean per unit of time. Thus, every improvement of output per unit of time goes to those ‘owners’ of time. Which is everyone. The perfect tax is a ‘head tax’ which is in fact a time tax per person.

    But since rent also accrues to land owners, owners of intellectual property and copyrights, owners of quotas and licences, and all fixed inputs into production, they may very well compete for both improvements in output per unit of their input, AND the surplus generated by increasing output per unit of time.

    The distribution of rents through society ultimately depends on the legal, institutional and social arrangements of a country. It is a choice.

    The general rule of thumb is that rents cannot be destroyed, only reallocated. Thus, if we focus on taxi licences, pharmaceuticals, and government spending as areas to eliminate the ability to procure rents, then remaining rentiers will benefit – landowners, banks, and the like. Indeed, if eliminating these rents improves the overall productive capacity of the economy, the rents accrue to other owners of fixe factors of production may be great than those taken from the targeted sector.

    If economists want to be society’s heroes, they need a fundamental market model that can be used to analyse the distribution of the economic rents generated by society.

    Let’s look at Frijters’ list of cases where rent-seeking could be targeted, and my reaction.

    1. banana import bans,

    Well, there is far more to ‘free trade’ than most economists realise. This is possibly the smallest issue around right now.

    2. the take-over of semi-public institutions by overpaid bureaucrats,

    This is of course the problem with attempting to create government owned entities that are able to act like private enterprise. Is it an argument for government departments to directly operate all government activities? Or for privatisation, where overpaid executives will capture rent through their pay and options, which might be ten times higher?

    3. over-subsidised medicines,

    I have no idea what this means. Subsidies for medicine simple fall under the banner of public health, which we all seem to agree is a priority. Some medicines may be over-subsidised, some under-subsidised, but by what measure I don’t know.

    4. differential costs of government deposit guarantees across financial institutions (which was probably instrumental in killing off many of the smaller financial players),

    Well, there is far more to banking than having another player join the mix, only to siphon off revenue to over-pay their senior executives.

    5. and the National Broadband Network

    I have no idea what is wrong with this.

    These are all small fry, especially when compared to land owners and bankers. In Frijter’s follow up post he explains how privileged rent-seekers are protected by the myth, or folk-story, that surrounds them. He explains in the case of the medical professions -

    …medical specialists have a legally guaranteed monopoly on particular medical activities…

    Now, whilst this reality is known by the insiders, this is not the public face of medical specialists at all. In the eye of the public, these are the heroes in Dr House and Gray’s Anatomy.

    The economics profession as a whole has in fact fallen for their own folk-story about the nature of rents in regards to land ownership and banking (where private banks generate rents through seignorage). When the profession debates rents, these largest of rent-seekers are absolutely ignored.

    The problem of course is that economics as a discipline does not a have a core working model of rents. Which means it is hard to put your finger on what is rent seeking. They get part the way there with models of monopolies, duopolies, imperfect competition. But invariably they all lead to the conclusion that there exist conditions, where markets are perfect or close to it, that economic rents cease to exist.

    This is nonsense.

    Since economic rents always exist, the question is how they are best distributed to achieve the social goals of society? The history of political-economy and moral-philosophy used to debate these very topics that economists ignore. And we need to bring back this debate. No longer can economists claim to be ‘technicians’ – with objective approaches to analysing distribution.

    We shall wait and see what Frijters’ future posts on this topic reveal about the mainstream view, where it is useful, and where it falls short.

    Please share this article. Tips, suggestions, comments and requests to rumplestatskin@gmail.com + follow me on Twitter @rumplestatskin

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    Response to Demeter (Reply #73)

    Mon Jan 21, 2013, 07:24 AM

    74. Aaron's Law: Violating a Site's Terms of Service Should Not Land You in Jail

    http://www.theatlantic.com/national/archive/13/01/aarons-law/267247/#

    A week ago, Aaron Swartz -- social activist, geek genius -- took his own life. Facing the choice between a federal prosecutor who insisted that he either accept the label "felon" and go to jail or fight a million-dollar lawsuit against 13 felony indictments, Aaron took the third option, and hanged himself...Aaron's alleged "crime" was that he used MIT's network to access a database of academic journal articles (JSTOR) and download millions of those articles to his laptop computer. He didn't "hack" the network to secure those downloads: MIT is a famously open network. He didn't crack any special password system to get behind JSTOR's digital walls. He simply figured out how JSTOR was filing the articles that he wanted, and wrote a simple script to quickly gather those articles and then copy them to his machine...What isn't supported are the accounts the government suggested in their breathless and ignorant press releases and indictment. There's nothing to support the idea that Aaron was simply going to "liberate" JSTOR -- Swartz was not a copyright anarchist, and any effective first-world distribution would easily have been taken down. Even more absurd was the suggestion that Swartz was trying to make money with the scholarly articles he had downloaded. Trust me on this: However much academics love articles from the Harvard Law Review, that love does not translate into money...So what he actually intended the public cannot know. And if the public cannot know, the government certainly did not know. But that doesn't matter under the law as it stands. All the government had to show to launch its witch hunt against this young activist was that he had violated JSTOR's "terms of service" and taken (as in copied) something worth more than $5,000. The "terms of service" (TOS) of any website are basically a contract. They constitute an agreement about what you can and can't do, and what the provider can and can't do. Not everything on a website is governed by contract alone: Copyright and privacy law can impose property-like obligations independent of a TOS. But the rules Aaron were said to have violated purported to limit the amount of JSTOR that any user was permitted to download. They were rules of contract. Aaron exceeded those limits, the government charged. He therefore breached the implied contract he had with JSTOR. And therefore, the government insists, he was a felon.

    It's that last step that is so odd within the tradition of American law. Contracts are important. Their breach must be remedied. But American law does not typically make the breach of a contract a felony. Instead, contract law typically requires the complaining party to prove that it was actually harmed. No harm, no foul. And in this case, JSTOR -- the only plausible entity "harmed" by Aaron's acts -- pled "no foul." JSTOR did not want Swartz prosecuted. It settled any possible civil claims against Swartz with the simple promise that he return what he had downloaded. Swartz did. JSTOR went away. But the government did not. In the weeks before his death, the government reaffirmed what they had been insisting upon for the 18 months before: jail, a felony conviction, and a bankrupting fine, or else Swartz was going to face a bankrupting trial.

    This rule of American law is absurd -- especially in a world where prosecutors can't be trusted to make reasoned and proportionate judgments about who should be labeled a felon and who should not. A breach of contract is a breach of contract. It is not an act of treason. It is not a threat to the realm. If every breach of contract worth more than $5,000 were a crime, Manhattan wouldn't be the world's most amazing city. Manhattan would be a federal penitentiary, with every prominent Wall Street firm very well represented. Fail to execute a trade on time? Two years in jail. Back out on an acquisition? Thirty to life. Computer law is different, however, because Congress didn't really understand this "wild west" (as the network was called when Congress passed the Computer Fraud and Abuse Act in 1986), and because geeks make them uncomfortable. For 25 years, the CFAA has given federal prosecutors almost unbridled discretion to bully practically anyone using a computer network in ways the government doesn't like. It does that by essentially criminalizing the violations of a site's "terms of service" in combination with obtain anything of" at least $5,000 in value. And even if in the vast majority of cases prosecutors exercised that discretion, well, in this case the abuse of that discretion has ended in tragedy. As Tim Wu so brilliantly describes, we have built a system of criminal law that depends upon our trusting the government. Few civil libertarians from either the right or the left, though, will be surprised that it turns out that the bureaucrats manning the battle stations cannot be trusted. Aaron Swartz is dead -- in my view, as a friend who knew him well for more than a decade --at least in part because of this breach of its duty by the government. Carmen Ortiz, the U.S. Attorney overseeing the prosecution, demonstrated that breach with the ignorance she displayed when this indictment was announced. As she said then, "Stealing is stealing, whether you use a computer command or a crowbar," -- demonstrating she knows nothing about computers, and apparently nothing about crowbars. And the line prosecutor working for her breached that trust when he made it clear that his first priority was not decency or proportionality but one more notch on his prosecutor's belt, for a prosecution that had nothing to do with keeping America safe from "criminals."

    But now Congress may actually do something to remedy at least part of this important flaw. Congresswoman Zoe Lofgren (D-CA) has introduced a draft bill -- importantly, first on Reddit, a platform Aaron had helped to build, and, once she gets the Net's feedback, in the United States Congress -- to change this rule of the CFAA and return contract law to its civil home. Her bill, which she calls "Aaron's Law," would limit the scope of the Computer Fraud and Abuse Act and exclude "crimes" that are nothing more than a breach of contract. No more "felonies." No more prosecutions resulting in prison sentences. Violations of the "terms of service" would be a breach, not a crime. Had that change been made before Aaron's death, the government's felony charges would likely have collapsed. Had the government's charges collapsed, Aaron Swartz, in my view, would still be frantically working to make the world a better place. Lofgren should be praised for her quick and smart response to the mess that brought about this tragedy. This isn't the only change that computer and copyright law require. It's not even on the top 10 list of the causes Aaron was fighting for. But it is an important start, and more changes can be added as people review the Reddit draft. And with the bipartisanship demonstrated by Darrell Issa's comments about this tragedy, it may well be an idea that even this Congress could pass.

    THIS VERY IMPORTANT ARTICLE CLEARLY AND COMPREHENSIVELY EXPLAINS THE ENTIRE EVENT AND THE TRAGEDY AND THE ERROR

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    Response to Demeter (Original post)

    Mon Jan 21, 2013, 07:27 AM

    75. Inside the Hostess Bankery- The Movie, Who Keeps the Dough

    A SHOCKING EXPOSE OF VULTURES DINING ON THEIR PREY--WORSE THAN YOU COULD IMAGINE!

    http://www.dailykos.com/story/2013/01/17/1179708/-Inside-the-Hostess-Bankery-The-Movie-Who-Keeps-the-Dough

    The Bakers Union members have had enough of being blamed for the closing of Hostess Bakeries in the mainstream media. The truth is much more complicated and the media has failed to tell the story. In this film you will hear directly from the Local 218 members in Lenexa, Ks. Be informed before it happens to your family too.

    VIDEO AT LINK

    If you or someone you know can't understand why there was a strike at Hostess, watch this film.

    When you hear the media narrative about about Hostess and the Bakers Union strike it is impossible to learn the truth. EVERY media outlet leaves out the details the Hedge Funds don't want the public to know. Here are some examples-

    1. The Union SELF-FUNDS a large portion of its pension. Each Lenexa, KS worker contributes $4.25 an hour to the pension fund.

    2. The 'Company' had collected that money for over a year under the lie that it would eventually be repaid to the pension fund. A total of $50 Million in one year.

    3. This debt to the pension was thrown out in bankruptcy court as a debt the 'Company' could not repay. This money has been forever stolen.

    4. The 'Company' or 'Hostess' is actually a pair of Hedge Funds, Monarch and Silver Point. It is a privately held business, it is not on the stock market.

    5. As a private company the Union cannot view the accounting books for the 'Company'. In court, when the books were opened it became clear the 'Company' was skimming from the pension for a long time. A total of $186 million.

    6. This money was stolen by the 'middle man' and never made it to the pension, therefore the Federal insurance plan- Pension Benefit Guarantee Corporation- will not help us. The PBGC is for failing pension funds. It will not cover theft of money that never made it to the pension.

    7. Our pension is NOT a part of the secured debt. When you hear that the 'Company' is on the hook for $1 Billion in secured debt remember that does not include the stolen pension money.

    8. The secured debt does include the money 'loaned' to the 'Company' by the Hedge Funds. Including the interest on those loans, as high as 15%. The 'Company' IS the hedge funds. In other words they loaned themselves money at a high interest rate and expect everyone to pay for it but themselves.

    9. These Hedge Funds never intended to make Hostess profitable. They were always motivated by selling the brand names and infrastructure at the highest value.

    10. Bankrupting the company and closing the doors allows them to strip the Unions from the brand names, driving up the resale value of the brand names. They never had to close, it was done as a mechanism to bust the Unions. The added bonus to the Hedge Funds was the ability to blame the strike for the closure.

    11. The 'Company' shopped for a bankruptcy judge and found one to their liking. They chose Judge Drain (no pun intended) in New York, despite the facts that the 'Company' is located in Dallas, was previously in Kansas City, and is not on the stock market.

    12. The judge helped write the contract with the 'Company' without any Union involvement. The judge granted permission to impose the contract on us before ANY rank and file Union member had seen the contract 'offer'.

    When the sale of 'Hostess Brands' is complete the Hedge Funds will pay back the secured debt of approx $1 Billion and pocket anything above that number without paying the pension funds back. Remember that almost half of that debt is loans and interest to THEMSELVES. They will have already profited tens of millions when they 'break even'. In a just society that would never happen.

    Most people assume that if you own a business and it goes bankrupt then you don't get to make millions of dollars on the closing. These Hedge Funds and the Congress members they fund have created a legal framework that protects them from ANY risk and leaves the damages at the front door of workers.

    It will happen to you too, if you don't pay attention. Do not assume the law is on your side, even though it may have been in years past.

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    Response to Demeter (Reply #75)

    Mon Jan 21, 2013, 08:09 AM

    76. New York banker Gordian Group to advise Hostess' bakery union

    http://news.yahoo.com/york-banker-gordian-group-advise-hostess-bakery-union-233058485--sector.html

    The union and pension fund for Hostess Brands Inc has hired Gordian Group, an investment bank specializing in distressed cases, to help preserve jobs and workers' benefits at the bankrupt maker of Twinkies snack cakes as Hostess negotiates with buyers. New York-based Gordian, which has no institutional loyalties to funds or bondholders in Hostess, will provide conflict-free advice for the welfare of the company's workers, The Bakery and Confectionery Union and Industry International Pension Fund (Bakers Fund) said.

    Mexico's Grupo Bimbo and a partnership between Apollo Global Management and veteran food executive C. Dean Metropoulos are among the leading candidates to buy Hostess Brands Inc's snack cake brands, according to three people familiar with the matter. In a separate announcement earlier this month, Hostess said Flowers Foods agreed to pay $390 million for Hostess's Wonder and other bread brands, including Nature's Pride and Butternut. That sale is still subject to a court-supervised auction...Grupo Bimbo, the world's largest bread maker, already has a large U.S. presence with Entenmann's baked goods, Thomas' English Muffins and Sara Lee bread. It had also bid for Hostess' bread business but lost out to Flowers in the race to become the opening bidder...


    The Bakers Fund said it intended to hold direct discussions with the bidders for Hostess and had chosen Gordian to advise it on the basis of the investment bank's track record in distressed financial situations. "The Bakers are here to work with bidders in any way as our sole goal is to maximize jobs and pension benefits for our members," said David Durkee, who is chairman of the Bakers Fund. "We are looking to support and work with well-capitalized bidders," said Durkee, also President of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union.

    Hostess, maker of the iconic Twinkies and Ding Dongs, expects to announce by January 25 a so-called stalking horse bidder that would set a baseline for an auction and guarantee a buyer, said people familiar with the matter. The sale, which could raise around $400 million or more according to one of the sources, is part of the company's bankruptcy reorganization. Hostess decided to shut down its business and liquidate after a strike by its bakers' union crippled the 82-year-old company...

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    Response to Demeter (Original post)

    Mon Jan 21, 2013, 08:41 AM

    77. A Place In The Sun- Stevie Wonder- 1966

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    Response to Demeter (Original post)

    Mon Jan 21, 2013, 08:45 AM

    78. Davos: what can we expect from world leaders' trip up the Magic Mountain?

    http://www.guardian.co.uk/business/2013/jan/20/davos-world-economic-forum

    For 51 weeks of the year, Davos is just another Swiss mountain resort, an architecturally drab strip town 5,000 feet up in the Alps. But at the end of January the world's movers and shakers arrive for five days of chin-wagging, deal-making and partying at the annual get-together of the World Economic Forum.

    The 2,500 participants this year include almost 40 heads of state and government, finance ministers, central bank governors, scientists, artists, trade unionists, anti-poverty campaigners and, of course, the highest concentration of billionaires on the planet. Angela Merkel, David Cameron and Russian prime minister Dmitry Medvedev are among the keynote speakers. Mali, the Middle East, Europe's debt crisis and the US fiscal cliff will be on the agenda. George Osborne is due to be in town when Britain's fourth-quarter growth figures are released on Friday. On the basis of the latest evidence, it may be more bad news for the chancellor.

    Expect coverage of the 43rd meeting of the forum to be peppered with references to Thomas Mann, who put Davos on the map with his book The Magic Mountain. The story, set in a sanitorium treating patients suffering from tuberculosis, provides an appropriate metaphor for the global economy still ailing nearly five years after the collapse of Lehman Brothers. Is global capitalism going through a prolonged period of convalescence or is it suffering from an incurable sickness? Most of the chief executives and policy-makers will, unsurprisingly, opt for the former but the Davos mood is much more sombre than it was in the boom years before the crash. Now the biggest global risk is deemed to be rising inequality.

    Ian Fleming was another author familiar with the town. In his novel On Her Majesty's Secret Service, Bond flies up the Davos valley to Blofeld's mountain-top lair by helicopter – the mode of transport favoured by world leaders and those masters of the universe who are not just rich but seriously loaded. For lesser mortals, there are two choices: road or rail. The journey by coach or limo is quicker, but the three-hour train ride is a real delight. The last hour on the mountain track from Landquart is one of the great rail experiences, particularly in late afternoon when the sun is setting over the Alps. Needless to say, the trains keep running when it is snowing.

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    Response to xchrom (Reply #78)

    Mon Jan 21, 2013, 09:03 AM

    85. NOT THAT AGAIN!

    Morning, X! How much longer do you think the Davos gig has to run, before its irrelevance ends it?

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    Response to Demeter (Reply #85)

    Mon Jan 21, 2013, 09:07 AM

    87. i don't know, Miss D. -- it's always made me very uncomfortable that it happens in the first place.

    i don't believe in 'conspiracies' per se -- but i think these folks get together and 'agree'. that's all it really takes.

    a few trips to the ski slope -- apres drinks, a little dinner conversation - and 'big' things are decided that eventually affect you and me.

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    Response to Demeter (Original post)

    Mon Jan 21, 2013, 08:51 AM

    79. (Obama's) Big Deal By PAUL KRUGMAN

    SHOULD BE SAID WITH MAXIMUM SARCASM, IMO

    http://www.nytimes.com/2013/01/21/opinion/krugman-the-big-deal.html?_r=0

    On the day President Obama signed the Affordable Care Act into law, an exuberant Vice President Biden famously pronounced the reform a “big something deal” — except that he didn’t use the word “something.” And he was right. In fact, I’d suggest using this phrase to describe the Obama administration as a whole. F.D.R. had his New Deal; well, Mr. Obama has his Big Deal. He hasn’t delivered everything his supporters wanted, and at times the survival of his achievements seemed very much in doubt. But if progressives look at where we are as the second term begins, they’ll find grounds for a lot of (qualified) satisfaction.

    Consider, in particular, three areas: health care, inequality and financial reform. Health reform is, as Mr. Biden suggested, the centerpiece of the Big Deal. Progressives have been trying to get some form of universal health insurance since the days of Harry Truman; they’ve finally succeeded. True, this wasn’t the health reform many were looking for. Rather than simply providing health insurance to everyone by extending Medicare to cover the whole population, we’ve constructed a Rube Goldberg device of regulations and subsidies that will cost more than single-payer and have many more cracks for people to fall through. But this was what was possible given the political reality — the power of the insurance industry, the general reluctance of voters with good insurance to accept change. And experience with Romneycare in Massachusetts — hey, this is a great age for irony — shows that such a system is indeed workable, and it can provide Americans with a huge improvement in medical and financial security. WORKABLE, DR. KRUGMAN? HAVE YOU TALKED TO ANYONE IN MASSACHUSETTS WHO IS FORCED TO PAY FOR THIS USELESS PRODUCT?

    What about inequality? On that front, sad to say, the Big Deal falls very far short of the New Deal. Like F.D.R., Mr. Obama took office in a nation marked by huge disparities in income and wealth. But where the New Deal had a revolutionary impact, empowering workers and creating a middle-class society that lasted for 40 years, the Big Deal has been limited to equalizing policies at the margin. That said, health reform will provide substantial aid to the bottom half of the income distribution, paid for largely through new taxes targeted on the top 1 percent, and the “fiscal cliff” deal further raises taxes on the affluent. Over all, 1-percenters will see their after-tax income fall around 6 percent; for the top tenth of a percent, the hit rises to around 9 percent. This will reverse only a fraction of the huge upward redistribution that has taken place since 1980, but it’s not trivial.
    AS BIDEN SAID: BIG F*****G DEAL. REMEMBER THE SARCASM

    Finally, there’s financial reform. The Dodd-Frank reform bill is often disparaged as toothless, and it’s certainly not the kind of dramatic regime change one might have hoped for after runaway bankers brought the world economy to its knees. Still, if plutocratic rage is any indication, the reform isn’t as toothless as all that. And Wall Street put its money where its mouth is. For example, hedge funds strongly favored Mr. Obama in 2008 — but in 2012 they gave three-quarters of their money to Republicans (and lost). THE RAGE IS BY SIMPLY HAVING THEIR KINGSHIP DISPUTED IN EVEN ONE ATOM OF RANGE...

    All in all, then, the Big Deal has been, well, a pretty big deal. But will its achievements last?

    COMPARING OBAMA'S FIDDLING WITH FDR'S REVOLUTION IS LIKE COMPARING A TODDLER'S BUILDING BLOCKS WITH AN ARTIST'S LEGO CREATION...

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    Response to Demeter (Reply #79)

    Mon Jan 21, 2013, 08:58 AM

    82. Paul Krugman is Wrong about the Rise of the Robots Martin Ford

    http://econfuture.wordpress.com/2013/01/18/paul-krugman-is-wrong-about-the-rise-of-the-robots/

    Paul Krugman has recently taken a keen interest in the rise of robots and automation — an issue that I have been focusing on since the publication of my book on this subject back in 2009.

    In a recent post, Krugman says the following:

    Smart machines may make higher GDP possible, but also reduce the demand for people — including smart people. So we could be looking at a society that grows ever richer, but in which all the gains in wealth accrue to whoever owns the robots.

    I think there is a fundamental problem with this way of thinking: as jobs and incomes are relentlessly automated away, the bulk of consumers will lack the income necessary to drive the demand that is critical to economic growth. Every product and service produced by the economy ultimately gets purchased (consumed) by someone. In economic terms, “demand” means a desire or need for something – backed by the ability and willingness to pay for it. There are only two entities that create final demand for products and services: individual people and governments. (And we know that government can’t be the demand solution in the long run). Individual consumer spending is typically around 70% of GDP in the United States.

    Of course, businesses also purchase things, but that is NOT final demand. Businesses buy inputs that are used to produce something else. If there is no demand for what the business is producing, it will shut down and stop buying inputs. A business may sell to another business, but somewhere down the line, that chain has to end at a person (or a government) buying something just because they want it or need it.

    The point here is that a worker is also a consumer (and may support other consumers). These people drive final demand. When a worker is replaced by a machine, that machine does not go out and consume. The machine may use energy, resources and spare parts, but again, those are business inputs—not final demand. If there is no one to buy what the machine is producing, it will get shut down. Think of on industrial robot being used by an auto manufacturer. The robot will not continue running if no one is buying cars.* So if we automate all the jobs, or most of the jobs, or if we drive wages so low that very few people have any discretionary income, then it is difficult to see how a modern mass-market economy can continue to thrive. (This is the primary focus of my book, The Lights in the Tunnel). There is plenty of evidence that consumers are already struggling with the structural shift occurring in the economy. The years leading up to the current economic crisis were, of course, characterized by people consuming on the basis of debt rather than income. A just-released report shows that an ever increasing number of Americans are raiding their retirement accounts to pay current bills.

    Does Paul Krugman really believe that it is possible to have a “society that grows ever richer” while a tiny number of robot owners hoover up more and more of total income — and the jobless masses consume the output by running up their credit cards or cashing in their 401(k)s? The point is that the robot revolution is not just about income inequality. It will ultimately impact the sustainability of economic growth. Innovation requires the existence of a market. New ideas will not receive the necessary backing if investors do not anticipate healthy market demand. A future with a dearth of viable consumers will be a far more zero-sum future. It will mean less of the type of innovation we associate with Steve Jobs — and more of the type you would find at Goldman Sachs. One of the main points I make in my book is that I think we will ultimately have to treat the market itself as a kind of renewable resource. Jobs and wages have historically been the primary mechanism that redistributes income (and purchasing power) from producers back to consumers. Widespread reliance on robots and automation may ultimately cause that mechanism to break down — and that will be a threat to continued prosperity.

    So what is the solution? In the long run, I think there will be no alternative except to implement direct redistribution of income. One possibility is a guaranteed minimum income funded by more progressive taxes (on the robot owners), and possibly by other sources (for example, a carbon tax). It goes without saying that implementing such a solution would be an enormous social and political challenge. And it will intertwine with the other major problems we face. Meaningful action on climate change, for example, will become even more difficult in world where much of the population is increasingly focused on individual income continuity. Make no mistake, responding to the impact that accelerating technology has on the job market could turn out to be one of the defining challenges for our generation.

    .............................................................................

    * Not all robots are used in production, of course. There are also consumer robots. If you own a toy robot, it may “consume” batteries. However, in economic terms, YOU are the consumer — not the robot. You need a job/income or you won’t be able to buy batteries for your robot. Robots do not drive final consumption — people do.

    ***********************************************************

    Martin Ford is the founder of a Silicon Valley-based software development firm and the author of the book The Lights in the Tunnel: Automation, Accelerating Technology and the Economy of the Future. He has over 25 years experience in the fields of computer design and software development. He holds a computer engineering degree from the University of Michigan, Ann Arbor and a graduate business degree from the University of California, Los Angeles.

    *********************************************************

    OF COURSE, WHEN THE ISSUE OF ROBOTS COMES UP, I TURN TO THE SCI-FI AUTHORS OF THE CLASSIC ERA, ESPECIALLY ASIMOV, WHO DESCRIBED DRONES (ALTHOUGH HE DIDN'T KNOW IT AT THE TIME).

    WHEN ROBOTS DO THE EASY STUFF, HUMANS CAN CONCENTRATE ON THE MORE DIFFICULT, UNIQUE STUFF: ART, SCIENCE, PLANNING, GOVERNMENT, EDUCATION..THINGS SEVERAL STEPS ABOVE DAILY SURVIVAL, REACHING INTO EVOLUTION OF THE SPECIES, PERHAPS EVEN THE END OF WAR FOR CONQUEST AND POWER.

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    Response to Demeter (Reply #79)

    Mon Jan 21, 2013, 09:12 AM

    88. MORE LEGO ART

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    Response to Demeter (Reply #79)

    Mon Jan 21, 2013, 10:04 AM

    93. amen to your Caps....And NO - "progressives" didn't want "Insurance"

    We wanted - and still want - HEALTH CARE FOR ALL. That's health CARE -NOT Health "Insurance."

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    Response to Demeter (Original post)

    Mon Jan 21, 2013, 08:51 AM

    80. STATE LOSS A BLOW TO MERKEL, BUT FAR FROM DECISIVE

    http://hosted.ap.org/dynamic/stories/E/EU_GERMANY_ELECTION?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2013-01-21-08-43-08

    BERLIN (AP) -- The defeat of Chancellor Angela Merkel's coalition in a high-profile state election is a blow to the German leader as she seeks a third term later this year. But it's far from clear that the opposition can build on its narrow win to oust the popular conservative.

    The opposition Social Democrats and Greens ejected Merkel's center-right alliance from the government of Lower Saxony state in an election Sunday, winning a single-seat majority in its legislature. It was a major test before national parliamentary elections, which are due in September.

    Merkel said "a defeat hurts all the more" when it is so close, but stressed how close her coalition came to winning and insisted that a victory seemed "completely impossible" a few months ago. That, she said after leaders of her Christian Democratic Union met Monday, "is also a good message, that we can win."

    Still, Lower Saxony's CDU governor lost his job despite his personal popularity - and surveys show Merkel herself is considerably more popular than her coalition of the last 3 1/2 years with the pro-market Free Democrats.

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    Response to Demeter (Original post)

    Mon Jan 21, 2013, 08:52 AM

    81. MORE BLUE MAN

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    Response to Demeter (Original post)

    Mon Jan 21, 2013, 08:59 AM

    83. CDU Loses Lower Saxony: State Defeat Heralds Tough Re-Election Fight for Merkel

    http://www.spiegel.de/international/germany/merkel-s-reelection-bid-suffers-setback-in-lower-saxony-election-a-878719.html

    Chancellor Angela Merkel's Christian Democrats suffered a defeat in Sunday's state election in Lower Saxony, depriving her of the boost she had been hoping for ahead of the September general election and indicating that she will have to fight harder for a third term than many had expected.

    It was the 12th consecutive setback in a state vote for her party, and even though the election is still eight months away and Merkel remains highly popular, the opposition Social Democrats and Greens have smelt blood. They won a combined 46.3 percent against 45.9 percent for the center-right alliance of the CDU and the struggling pro-business Free Democratic Party. That will enable the center-left to govern with a majority of one seat in the Lower Saxony state parliament after the cliffhanger vote.

    "I won't deny it, after such an emotional roller coaster such a defeat is all the more painful, so we are all sad today to some extent," Merkel told a news conference on Monday. But, matter of fact as ever, she shrugged off the implications for her re-election, saying: "We don't have a campaign for the general election, that will come later, we have a whole series of serious problems to solve, the economic situation is fragile , we want to ensure that the labor market situation remains as it is or can even improve a little, we have big tasks in Europe."

    The result came despite damaging gaffes by the SPD's contender to oust Merkel, Peer Steinbrück, in recent months. Steinbrück, already under fire for earning over €1 million ($1.33 million) for lucrative speaking engagements in the last three years, said recently that German chancellors should be paid better -- a startling comment that suggested he was only in the race for the money.

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    Response to Demeter (Original post)

    Mon Jan 21, 2013, 09:03 AM

    84. Troika Travails: Split Emerges Over Cyprus Bailout Package

    http://www.spiegel.de/international/europe/imf-and-europe-disagreement-could-delay-cyprus-bailout-package-a-878773.html

    When euro-zone finance ministers meet in Brussels on Monday, a welcome guest will be missing. Christine Lagarde, 57, the French managing director of the International Monetary Fund (IMF), is currently unwilling to discuss giving aid money to ailing euro-zone member Cyprus. For some time now, the Americans in particular have been eyeing the IMF's involvement in Europe with suspicion, causing the Frenchwoman to hit the brakes time and again. "I have no mandate for that" is a statement that the euro-zone finance ministers have heard only too often from Lagarde.

    As such, it remains to be seen whether the IMF will ultimately participate in a loan program for Cyprus. A number of countries, Germany first and foremost, have said that IMF participation is crucial. The statutes of the European Stability Mechanism (ESM), the euro zone's €700 billion ($931 billion) permanent backstop fund, stipulate that the IMF must rubber stamp a country's debt sustainability before any cash can flow.

    But this time around, the IMF is hesitating. A member of the troika which is currently negotiating the bailout deal with the Cypriot government, the IMF has an entirely different notion as to how the program should look.

    In particular, there are differing points of view over whether the Mediterranean island nation will ever be able to repay its debts. According to current forecasts, the Cypriot debt load will grow to 140 percent of its gross domestic product (GDP) by the year 2014.

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    Response to xchrom (Reply #84)

    Mon Jan 21, 2013, 09:05 AM

    86. Wow! The IMF is showing its hand to be a busted flush

    and the US as its string-puller. How agonizing for a proud woman like LaGarde.

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    Response to Demeter (Original post)

    Mon Jan 21, 2013, 09:16 AM

    89. Sorry, I have got to stop for breakfast

    I'm starving, and we won't see freezing all week. I'm living in an arctic desert, where it never snows and continually blows...

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    Response to Demeter (Original post)

    Mon Jan 21, 2013, 09:25 AM

    90. Finnish PM opposes idea of bank deal

    http://www.irishtimes.com/newspaper/finance/2013/0121/1224329103206.html

    Discussion about the treatment of legacy assets by the euro zone’s rescue fund is expected to gather pace today as euro zone finance ministers meet in Brussels, amid continuing divisions among euro zone countries about the fund’s application to Ireland’s previously recapitalised banks.

    The election of the new chair of the euro group will top today’s agenda, but finance ministers will also discuss the thorny issue of how retrospective recapitalisations will be classified by the European Stability Mechanism – a key concern for Ireland as it seeks to secure funding for AIB and Bank of Ireland.

    “While technical discussions have been ongoing, the time has come to take a step back and to ask ministers to have a more political discussion about the direct recapitalisation instrument . . . questions around what is a legacy asset, who is responsible for it,” said one EU source.

    Finnish perspective

    The meeting, which will be attended by Michael Noonan, comes as Finnish prime minister Jyrki Katainen dismissed as “inappropriate” Irish expectations of a special deal on banking debt. Asked how he felt about Ireland’s “special concessions” from German chancellor Angela Merkel and other European leaders in June, Mr Katainen said leaders would return again to the issue of banking debt at this year’s June summit.

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    Response to Demeter (Original post)

    Mon Jan 21, 2013, 09:38 AM

    91. Marion Williams and Alex Bradford - Take me to the water

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    Response to Demeter (Original post)

    Mon Jan 21, 2013, 09:54 AM

    92. OMFG - face-palm ...

    The responses to Xchrom's thread on MLK ...

    I despair. We are so totally lost ....

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    Response to Demeter (Original post)

    Mon Jan 21, 2013, 10:26 AM

    94. It's seriously snowing out there!

    I guess my complaints were heard....the weatherman sure didn't predict this!

    It's like a blizzard out there! Here's hoping this is the start of drought-busting.

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    Response to Demeter (Original post)

    Tue Jan 22, 2013, 02:15 AM

    96. Musical Interlude IV

    Blue Eagle by Bat Mcgrath:



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