News you can't use and could probably care less about

You know it's a slow news day when most of the top headers are filled with which celeb wore what revealing outfit to which exclusive event. Or then there's the gaffes in the sporting world for all the guys. What's truly irritating is when a story is washed, rinsed and repeated the next day when it wouldn't affect the price of tea in China. And no you don't need to keep us posted about any developments because there aren't going to be any. When a guy is dead and the suspect killed himself neither is coming back to give more details and most times no body else knew why because they were always nice quiet guys, right?

Breaking News.....

Wildlife official: wolf killed sheep in NE Wash. Film at 11.

Okay okay I know what you're thinking. Where the hell is all this going? Glad you asked because I don't know either but we'll keep you posted with developing updates.

Nope the real news can be boiled down to a couple of events over the past few days:

The Euro money printing presses went into overdrive and the gamblers in the game wet themselves with excitement.

Health care passed and republican heads exploded. How gleeful they were when they thought it didn't pass hence taking away juniors' much needed operation. These guys are sick.

The Highway Bill passed although the "No" party did their best to water it down and even tried to slip in another anti abortion amendment. Sorry people the road crews will be out force and working furiously to get er done before bad weather sets in. Tied to the same bill was student loans much to the relief of dads who now won't have to take a third mortgage on the house to pay for college.

Speaking of weather the bulk of the nation is frying with triple digit temps. My sources back east tell me 250,000 were without power yesterday due to the baking. All the while Colorado continues to burn. Humm, what Pyro gods did they tick off?

I'm sure there are better things to do but these days who has the cash? Any anyway you might just get shot and/or robbed in the process.

All right then just so you won't be disappointed:

Sheesh what ya have to do for a little attention these days. There ya satisfied?

Friday beaver meltdown and bailout

And you thought this was about the fires in Colorado.

I have to laugh every time I hear the latest incarnation of the european bail out plan. The newest twist on this rearrangement of the deck chairs on the Titanic is to appoint a single supervisor to oversee the euro banks' plan. Never any concrete details of the plan just more blathering about how they'll only break legs and not cut them off. Austerity is such a dirty word now. The biggest problem according to economists with knowledge far greater than me is that there is debt with both the banks involved (at present that would be Spain and Italy) and the governments who were suckered into the debt swaps in the first place. Ze Grande Plan now I gather is to only loan to the banks and leave the governments out of it or so it seems. Paul Krugman noted economist has pointed out in past posts that a bail out to a nation presents the problem of just shifting the debt around from the government to the banks and back again. I'd add that throwing austerity (there's that word again) on the citizens will do little to provide the necessary funds to pay back those loans.
At any rate the markets seem to think this is a swell idea because after all you can't keep the crap game going if the euros aren't flowing, Somebody has to be screwing somebody else over or it's just no fun at all. Got to keep that real time graph jumping you know.
And the last punch line of this joke is that just as before the can kickers are out in force and are shooting to the end of the year for any resolution. The big question remains will they be able to keep all amused in the mean time before the music stops and everything hits the deep freeze again? The natives are restless and not too thrilled with the last punch to the midsection. That's economically speaking.

Mwahahahaha How ya goina get out of this one Sparky?

Bank fails later but then I've never really checked foreign bank fails. Must start doing that. The list must be gargantuan.

Update: No bank fails this week and to my surprise there aren't that many foreign banks that failed because the ones that did were very large. So I can only assume that most foreign countries operate with only three or four large banks unlike the U.S that has thousands.

Health care... finally

It'll be nice to actually have health care. For those foreign readers here who don't understand how our American system works it's fairly simple. You work and many but not all employers here give you some type of medical coverage. Costs (premiums) can be totally covered by the employer or split with the worker paying part. The problem of late is that insurance companies and medical providers have been raising rates to nearly double in just the last few years. It was estimated that other countries were paying around $3600 per year per person for coverage while the U.S. was paying over double that amount. Many employers here were either making workers pay more of their share or dropping coverage altogether. Then there were the co pays and deductibles. You see a medical policy only covered 80% of the actual costs of care with the remaining left to the patient. With the deductible the first $100 to $150 of costs were left to the patient. Some policies have deductibles as high as $500 to $1000 meant only as catastrophic insurance it left the patient with a policy that he could afford to have but not use. Sounds like a neat form of extortion doesn't it? Now if you don't have a job in this country it's likely that you also don't have insurance either. The only way to attain coverage is to buy it yourself on the open market. Try doing that when the costs of a premium eats up well over half of an unemployment check.
So what do people in America do when they have no job and no coverage? They wait and hope to get over an illness because the first thing a doctors' office asks is if you have insurance. If you don't they want payment up front or doc's not in for you. With no other alternatives it's off to the emergency room at a local hospital because they can't turn you down. Unfortunately that sort of care is the most expensive and those costs are moved to the taxpayer. What about free clinics and charities you may ask? In a down economy many have closed or have a waiting list of months. So like it or not we all pay or paid for this dysfunctional system.

Kennedy Care
Yes I'll call it that because Ted should be given the most credit for this system change. He did after all spend most of his life trying to look out for the little guy and this Affordable Care Act (it's real name) was one of his last wishes.
What does this act really do for our system? I've heard so many out there with a knee jerk reaction when the topic comes up. Mostly negative from folks out here in cyberspace. But when I ask them if they've actually read the bill it's always a flat out no! Followed by "I don't need to read that because it came from Obama". Well actually it came from both sides of the aisle of congress and was examined by the CBO our budget office. And many of the ideas came from republicans including the individual mandate. Why was the bill so complicated and lengthy? Because we couldn't have a one size fits all system.

What does the bill do?
You've probably heard just some of the aspects but here's a general overview:

It spreads the costs to all Americans by requiring coverage for all (the mandate). That in itself should help lower costs with more money in the system. Even those on the lower end of the pay scale will contribute at least a little. That's fair.

*No more pre existing condition denials.
*Sons and daughters can stay on their parents plan until they're 26. (A good thing for parents with kids in college.)
*An insurance provider must pay out at least 80% of it's income in coverage.
*Plans are now portable. Going from one employer to another means no loss of coverage.
*The unemployed will now be able to afford coverage as they will now be subsidized.
*The doughnut hole in Medicare will now be filled.
*A focus on preventative care with all costs covered. (the expression an ounce of prevention is worth a pound of cure comes to mind)

It is a lengthy bill and many of the parts have little to do with your own particular situation but were necessary to make the system work. I'm sure there will be many tweaks to this legislation in the years to follow as we see just how things work out.
For those of you who actually want to know what this is really about I give you:

The Affordable Health Care Act

Screw me screw you

It's become a fine art of coital mayhem in the market place. A somewhat devious plan of what may be termed content creep. The result of years of pain staking analysis to stretch the bottom line and hence enhance the coffers of corporate America and most other countries for that matter. Not just relegated to the goods but their production and services as well. Full service now means only what the fine print dictates. When was the last time someone pumped gas for you? Forget about checking the oil and washing the front window. And good luck finding a 16 oz. can of any fruit or vegetable in any market. An 8 oz. can of tuna went gradually down the scale to 6 1/2 then 6 and now a meager 5 oz. and not to forget to drain the 1/2 oz. of liquid. Airline seats shrink ever small even though our backsides get bigger and bigger and don't forget the baggage fees because shaving a pound or two here or there might just save millions in the long run. Won't the shareholders be delighted?

On the worker side it's no different. It was once about turnover. Never let the underlings rise to an expensive position. This was all accomplished by some crafty lateral moves on managements' part. Then the downsizing began. Tom, Frank and Bob all had the same workload at one time anyway. So it was a simple matter of firing Bob and splitting his job between Tom and Frank. When even that was not enough they fired Frank and heaped everything on Tom. No pay raise or benefits mine you but an important sounding title to make up for his loss. When even that was not enough they outsourced the whole department to a company in India. Eventually the entire company lands up overseas with only a small staff of administrators in an office. All well and good for the CEO and the shareholders, bad for everybody else. But how do they evade our so called "overbearing" corporate taxes one might ask? Simple. Just bribe the local officials in that far off land to report that your company has paid them the proper taxes to their country. And to add insult to injury our tax code allows for the write off and even rewards companies for doing this.

Lastly we have insourcing. When you can't ship a job overseas like many of the service jobs you hire someone from over there and bring him here only to pay him half the going rate or worse declare him an independent contractor even though he has set hours and all the other requirements of a company man. There's the Temp who gives the benefit of not having to pay benefits and doesn't mind when your telling him the job is over. Most agencies even offer medical and other goodies which of course are unaffordable to the poor slob working for them because he must pay out of pocket from some meager wages. Not to forget those two very dirty words over time. No such animal in this company. Must be worked just up to the cut off of a full time worker, so much cheaper that way.

So now you see just the tip of the iceberg. This shining apple to the world that's slowly rotting at it's core. This is the grand vision to return this nation to the days of yesteryear when the robber barons ran everything while the general populace died an early death because after all replacements are cheap. Screw me? No screw you. We're all screwed.

Have we reached that point?

Talking to some folks up there in Toronto last night about the mall that collapsed, it hit home what kind of society we live in now. They informed me that 1 was dead and 30 were missing. Only checked once when the story first broke so wasn't sure what was happening. Later watch the report on Canadian news that they had called off the rescue. Too afraid to continue for fear of more lives lost. I was aghast. How could you leave someone trapped under rubble knowing that there may be a chance that they might be alive?
A couple of things come to mind here. One is that I've been trained in such matters, confined space rescue. And two I wouldn't have hesitated to lend a hand if it wasn't for the fact that I'm so far away and it'd take a long time to get the paperwork and travel time just do get there. And to his discredit it was the mayor of the town just north of Toronto who called off the mission. For him I'd have a backhand to the face. Sorry guy but I've been in a few nasty situations in my time and I sure didn't give up. If I had I wouldn't be writing this right now. From what I saw they sure weren't giving it the effort required. A couple of construction crews with cranes with some iron workers to reinforce would have all of that taken care of in short order. Especially knowing that lives were at stake. Even the ordinary people of the town were willing to risk their lives but not the mayor. Can't wait till his term is up if they don't throw him out first.
So what have we come to these days? Do we just wait and hope the insurance will cover the loss. Or maybe blame the victims say it was their own fault for being in the mall in the first place. You know like the disclaimer at the bottom of a ticket. Shall we just step over a dying man on the sidewalk too afraid to get involved? It sure looks that way anymore. This never used to be. We all used to look out for each other. It was only the lowest of the low who were so heartless. But I guess not anymore it's every man for himself. Sorry I just don't think like that.

The game will continue as planned

Brother can you spare $100K?

Insanity as Einstein defined it is doing the same thing over and over and expecting a different result. Nothing could be truer for our financial system. As the economies of so many countries these days are in a slow motion lock up the solution which should be quite obvious by now is ignored like the plague. Exactly why anyone would expect that by giving yet more advantages to banks and investment companies would make our current economic picture better is a puzzle. Logic would dictate that if one method did not work after so many tries then it's time to change course. But that's not the case for the central world banks. Rather than focus on the actual customer the consumer it's content with looking in the mirror and adding more make up.

There's a vain attempt to pull out the tire pump and inflate the same bubble that burst in 08. Rather than embark on a long term plan to right the financial course that's been stuck on the rocks these last few years the central banks are taking a reverse course and lowering the standards for loans by easing collateral requirements. Haven't we been here once before? A home loan in 06 could be had with no money down and a borrowing max of 125%. All with little to no income verification. It didn't take a genius to figure that was a recipe for disaster. But the biggest problem here is that market values have dropped like a stone these past few years. That's left a ton of underwater loans and many empty foreclosed homes on the banks books. That picture has not changed much even after meager attempts to remedy the situation. It seem the banks will just not cave and give up that loss of value. That's kind of sad when you think about it. They'll bury a defaulted loan in a dusty file in a feeble attempt to look good to their shareholders (nothing like a little hocus pocus with the books), but in the end the home is eventually sold at a loss at foreclosure or worse torn down from decay. Either way the bank loses.

Anyway you look at it the present plan has not changed. It's all about making those who had little to do with the problem pay the bill. Yes there may have been a few consumers too greedy to see the end result but on average this is hitting even the financially responsible homeowners as well. And to add insult to injury this will affect even those of us in a better economic situation as governments cut services and increase taxes and fees.

On the bright side there were no bank fails this week (or is that really a good thing?)

Beaver Friday and bank robbers in reverse

Maybe we should call this little guy lucky beaver since he doesn't have to deal with banks. The Mafia on their best day couldn't have figured out a way to rob the world population like they're doing right now. Where to begin? First all the rules that prevented another Great Depression were pulled away leaving the children on the playground to piss away everybody's house and retirement. And when that wasn't enough they got their allowance with bonus only to do it again. Step back from all the hand wringing and cheers of joy with this Kabuki theater this is a Ponzi scheme plane and simple. Only the suckers haven't realized they are being taken for a ride. And it's not over yet. You recall the rating agencies? Those wonderful folks who gave a passing grade to subprime mortgages. And when call out on it denied it by saying it was the banks' fault. (Nothing like passing the buck when there's no real buck to be passed or would that be termed plausible deniability?) At any rate to add gasoline to the already burning fire this rating agency has just lowered the ratings on 15 major banks worldwide. You may be thinking good a slap on the wrist for this band of thieves. But once again they are not stupid as most of the dumbest criminals. By deeming them less than worthy the banks will have no choice but to raise rates to their borrowers and depositors as the money they steal er borrow will be more expensive. For those who wish to read more

A word about capitalization as I understand it. For every dollar that you let them hold in your account nine dollars is lend out on that buck. It's called leverage. In essence it's owning more assets than you could otherwise own much like a mortgage. Problem is the banks are at present only holding less than 3% in working capital. When the government requested that they increase this amount to cover potential losses you'd have thought it was a request for a right arm. The banks refused and of course our congress being bought and paid for by the banks pressed the issue no farther.

So what does this mean on the grand scheme of things? For the countries facing default it's the nail in the coffin. Nothing like expecting to try and deal with one amount of debt then have the rate increased even before you could calculate the pay back. Whether or not this will be joyous news for the boys on Wall Street we will see. While they have tooted the horn about how bail outs are great (for them of course) the rest of the world has missed the real inside sick joke here. Thank you sir may I have another as the economic paddle is about to hit us square in the rear.

We haven't seen any major bank fail but the game is far from over. I'll fill you in on the smaller ones later as always.

Update: It appears the banks are taking this news with a bit of glee as their stock have risen today. Nothing like a bit of what should be bad news get turned around into a great Christmas bonus. So it's more fleecing of the Peonage with higher interest rates. They must be loving this. They get the elevator we get the shaft.