Economist: Health Care Bill “Is Just Another Bailout Of The Financial System”
by Zero Hedge - December 30th, 2009 2:16 pm
Courtesy of George Washington
It is obvious that many republicans oppose the proposed health care bill. But many liberals and progressives oppose it as well.
For example, economist L. Randall Wray writes:
Here’s the opportunity, Wall Street’s newest and bestest gamble: there is a huge untapped market of some 50 million people who are not paying insurance premiums—and the number grows every year because employers drop coverage and people can’t afford premiums. Solution? Health insurance “reform” that requires everyone to turn over their pay to Wall Street. Can’t afford the premiums? That is OK—Uncle Sam will kick in a few hundred billion to help out the insurers. Of course, do not expect more health care or better health outcomes because that has nothing to do with “reform” … Wall Street’s insurers… see a missed opportunity. They’ll collect the extra premiums and deny the claims. This is just another bailout of the financial system, because the tens of trillions of dollars already committed are not nearly enough.
Wray points out that – with the repeal of Glass Steagall – the financial sector and the insurance businesses (the “f” and “i” in the “fire” sector) are somewhat merged.
Wray is no conservative. He is Ph.D. is Professor of Economics at the University of Missouri-Kansas City, Research Director with the Center for Full Employment and Price Stability and Senior Research Scholar at The Levy Economics Institute – which focuses on inequality in the distribution of earnings, income, and wealth.
Dr. Andrew Coates describes the bill as “a guarantee of insurance industry dominance and the continued privatization of health care in every arena.”
Dr. Coates is no conservative. He is a medical doctor, a member of the Public Employees Federation, AFL-CIO, secretary of the Capital District chapter of Physicians for a National Health Program, and teaches at Albany Medical College.
And – as I have previously pointed out – progressives such as law school professor Sheldon Laskin, anti-war activist David Swanson, and Miles Mogulescu are calling the bill authoritarian and unconstitutional because the government cannot legally force people to buy private health insurance.
Indeed, given Wray’s point that this is just another bailout in disguise, the bill should more properly be called a “wealth reform” bill than health reform legislation.
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DiggKey Theme In Interview With ShadowStats' John Williams – (You Guessed It) Hyperinflation And The Death Of The US Economy
by Zero Hedge - December 30th, 2009 1:38 pm
Courtesy of Tyler Durden
If you thought John Williams, who a month ago prophesied that the US could be facing hyperinflation as soon as 2010, has changed his tune, think again. In an interview conducted by Phil Maymin of the Fairfiled Weekly, the man who has made a business out of debunking the government’s data fabrication machine, dishes out some very hard to swallow truths about the US economy and where the fiat world is headed. As always, Williams’ perspectives are debate-worthy by all, whether inflationist or deflationist: in a field of media sycophants, JW is not afraid to speak what we all know, yet rarely wish to acknowledge.
Maymin: So we are technically bankrupt?
Williams: Yes, and when countries are in that state, what they usually do is rev up the printing presses and print the money they need to meet their obligations. And that creates inflation, hyperinflation, and makes the currency worthless.
Obama says America will go bankrupt if Congress doesn’t pass the health care bill.
Well, it’s going to go bankrupt if they do pass the health care bill, too, but at least he’s thinking about it. He talks about it publicly, which is one thing prior administrations refused to do. Give him credit for that. But what he’s setting up with this health care system will just accelerate the process.
Where are we right now?
In terms of the GDP, we are about halfway to depression level. If you look at retail sales, industrial production, we are already well into depressionary. If you look at things such as the housing industry, the new orders for durable goods we are in Great Depression territory. If we have hyperinflation, which I see coming not too far down the road, that would be so disruptive to our system that it would result in the cessation of many levels of normal economic commerce, and that would throw us into a great depression, and one worse than was seen in the 1930s.
What kind of hyperinflation are we talking about?
I am talking something like you saw with the Weimar Republic of the 1930s. There the currency became worthless enough that people used it actually as toilet paper or wallpaper. You could go to a fine restaurant and have an expensive dinner and order an expensive bottle…
Key Theme In Interview With ShadowStats’ John Williams – (You Guessed It) Hyperinflation And The Death Of The US Economy
by Zero Hedge - December 30th, 2009 1:38 pm
Key Theme In Interview With ShadowStats’ John Williams – (You Guessed It) Hyperinflation And The Death Of The US Economy
Courtesy of Tyler Durden
If you thought John Williams, who a month ago prophesied that the US could be facing hyperinflation as soon as 2010, has changed his tune, think again. In an interview conducted by Phil Maymin of the Fairfiled Weekly, the man who has made a business out of debunking the government’s data fabrication machine, dishes out some very hard to swallow truths about the US economy and where the fiat world is headed. As always, Williams’ perspectives are debate-worthy by all, whether inflationist or deflationist: in a field of media sycophants, JW is not afraid to speak what we all know, yet rarely wish to acknowledge.
*****
Maymin: So we are technically bankrupt?
Williams: Yes, and when countries are in that state, what they usually do is rev up the printing presses and print the money they need to meet their obligations. And that creates inflation, hyperinflation, and makes the currency worthless.
Obama says America will go bankrupt if Congress doesn’t pass the health care bill.
Well, it’s going to go bankrupt if they do pass the health care bill, too, but at least he’s thinking about it. He talks about it publicly, which is one thing prior administrations refused to do. Give him credit for that. But what he’s setting up with this health care system will just accelerate the process.
Where are we right now?
In terms of the GDP, we are about halfway to depression level. If you look at retail sales, industrial production, we are already well into depressionary [territory]. If you look at things such as the housing industry, the new orders for durable goods we are in Great Depression territory. If we have hyperinflation, which I see coming not too far down the road, that would be so disruptive to our system that it would result in the cessation of many levels of normal economic commerce, and that would throw us into a great depression, and one worse than was seen in the 1930s.
What kind of hyperinflation are we talking about?
I am talking something like you saw with the Weimar Republic of the 1930s. There the currency became worthless enough that people used it actually as toilet paper or wallpaper.…
Key Theme In Interview With ShadowStats’ John Williams (You Guessed It) – Hyperinflation And The Death Of The US Economy
by ilene - December 30th, 2009 1:38 pm
Key Theme In Interview With ShadowStats’ John Williams – (You Guessed It) Hyperinflation And The Death Of The US Economy
Courtesy of Tyler Durden
If you thought John Williams, who a month ago prophesied that the US could be facing hyperinflation as soon as 2010, has changed his tune, think again. In an interview conducted by Phil Maymin of the Fairfiled Weekly, the man who has made a business out of debunking the government’s data fabrication machine, dishes out some very hard to swallow truths about the US economy and where the fiat world is headed. As always, Williams’ perspectives are debate-worthy by all, whether inflationist or deflationist: in a field of media sycophants, JW is not afraid to speak what we all know, yet rarely wish to acknowledge.
*****
Maymin: So we are technically bankrupt?
Williams: Yes, and when countries are in that state, what they usually do is rev up the printing presses and print the money they need to meet their obligations. And that creates inflation, hyperinflation, and makes the currency worthless.
Obama says America will go bankrupt if Congress doesn’t pass the health care bill.
Well, it’s going to go bankrupt if they do pass the health care bill, too, but at least he’s thinking about it. He talks about it publicly, which is one thing prior administrations refused to do. Give him credit for that. But what he’s setting up with this health care system will just accelerate the process.
Where are we right now?
In terms of the GDP, we are about halfway to depression level. If you look at retail sales, industrial production, we are already well into depressionary [territory]. If you look at things such as the housing industry, the new orders for durable goods we are in Great Depression territory. If we have hyperinflation, which I see coming not too far down the road, that would be so disruptive to our system that it would result in the cessation of many levels of normal economic commerce, and that would throw us into a great depression, and one worse than was seen in the 1930s.
What kind of hyperinflation are we talking about?
I am talking something like you saw with the Weimar Republic of the 1930s. There the currency became worthless enough that people used it…
What Yield Was the Device That Just Hit PIMCO's High Income Fund?
by Zero Hedge - December 30th, 2009 1:30 pm
Courtesy of Marla Singer
You don’t really expect to see huge spikes in large ($1 billion plus AUM) bond funds absent some significant fixed income news (or perhaps, internal scandal). So what’s going on with the PIMCO High Income Fund (NYSE:PHK) today?
It might be easier to dismiss a gutting like that if volume were low, but, of course, it is not.
The fund has tended to trade at a significant premium to NAV of late, and has managed to demonstrate some rather dramatic returns to NAV over the last 12 months, so perhaps this is “normal”…
…but somehow we doubt it.
A bit of a volatility study anyone?
Back in March Zero Hedge opined:
Bill Gross’ recent foray into a shadow government role may be just in time to avoid the depression from spreading onto the green, green grass of the Newport Beach country club. News is out that three of PIMCO’s closed-end funds have postponed dividend payments declared February 2 as they “failed to meet the ratio of assets to borrowings set by regulators.” The three harbinger funds are Pimco Corporate Income Fund, Corporate Opportunity Fund and High Income Fund. Scheduled payments on these funds will not be made either today or April 2 PIMCO said in a statement today. This is not the first time the bond manager has gotten in dividend trouble: last December it was forced to suspend dividends on 6 of its closed-end funds.
U.S. Securities law prohibits dividend payments if debt funds do not meet certain criteria: funds issuing debt are required to maintain net assets of at least 300% of leverage, while those selling preferred shares must maintain a 200% ratio.
Curiously, the three PIMCO funds all closed trading last week at a premium with the High Income fund’s share trading at a 56% premium to NAV. While not much additional disclosure is available at this point, for PIMCO to be in any sort of trouble, after being the main asset manager riding high on the LTM treasury wave, can only be a portent of bad things to come.
PHK’s habit has been an early month (1st, or 2nd) dividend declaration. Given that this is only a few days away, could it be that someone has gotten a premature whiff of the acrid, wafting odor of an impending dividend surprise?
What Yield Was the Device That Just Hit PIMCO’s High Income Fund?
by Zero Hedge - December 30th, 2009 1:30 pm
Courtesy of Marla Singer
You don’t really expect to see huge spikes in large ($1 billion plus AUM) bond funds absent some significant fixed income news (or perhaps, internal scandal). So what’s going on with the PIMCO High Income Fund (NYSE:PHK) today?
It might be easier to dismiss a gutting like that if volume were low, but, of course, it is not.
The fund has tended to trade at a significant premium to NAV of late, and has managed to demonstrate some rather dramatic returns to NAV over the last 12 months, so perhaps this is “normal”…
…but somehow we doubt it.
A bit of a volatility study anyone?
Back in March Zero Hedge opined:
Bill Gross’ recent foray into a shadow government role may be just in time to avoid the depression from spreading onto the green, green grass of the Newport Beach country club. News is out that three of PIMCO’s closed-end funds have postponed dividend payments declared February 2 as they “failed to meet the ratio of assets to borrowings set by regulators.” The three harbinger funds are Pimco Corporate Income Fund, Corporate Opportunity Fund and High Income Fund. Scheduled payments on these funds will not be made either today or April 2 PIMCO said in a statement today. This is not the first time the bond manager has gotten in dividend trouble: last December it was forced to suspend dividends on 6 of its closed-end funds.
U.S. Securities law prohibits dividend payments if debt funds do not meet certain criteria: funds issuing debt are required to maintain net assets of at least 300% of leverage, while those selling preferred shares must maintain a 200% ratio.
Curiously, the three PIMCO funds all closed trading last week at a premium with the High Income fund’s share trading at a 56% premium to NAV. While not much additional disclosure is available at this point, for PIMCO to be in any sort of trouble, after being the main asset manager riding high on the LTM treasury wave, can only be a portent of bad things to come.
PHK’s habit has been an early month (1st, or 2nd) dividend declaration. Given that this is only a few days away, could it be that someone has gotten a premature whiff of the acrid, wafting odor of an impending dividend surprise?
Clusterfuck Nation ThinkTank's 2010 Forecast: Definitely Not Rosy
by Zero Hedge - December 30th, 2009 12:51 pm
Courtesy of Tyler Durden
As there are less than 48 hours in 2009, which everyone except Goldman’s bonus recipient corps can’t wait to be over, some last minute opinions on what awaits us in 2010. This one comes from James Howard Kunstler, author of the Long Emergency and the Clusterfuck Nation blog. As one can imagine from the title, we don’t anticipate Mr. Kunstler will be making the CNBCOMCAST tour of propaganda duty circuit any time soon.
The Center does Not Hold…But Neither Does the Floor
Introduction
There are always disagreements in a society, differences of opinion, and contested ideas, but I don’t remember any period in my own longish life, even the Vietnam uproar, when the collective sense of purpose, intent, and self-confidence was so muddled in this country, so detached from reality. Obviously, in saying this I’m assuming that I have some reliable notion of what’s real. I admit the possibility that I’m as mistaken as anyone else. But for the purpose of this exercise I’ll ask you to regard me as a reliable narrator. Forecasting is a nasty job, usually thankless, often disappointing – but somebody’s got to do it. There are so many variables in motion, and so much of that motion is driven by randomness, and the best one can do in forecasting amounts to offering up some guesses for whatever they are worth.
I begin by restating my central theme of recent months: that we’re doing a poor job of constructing a coherent consensus about what is happening to us and what we are going to do about it.
There is a great clamor for “solutions” out there. I’ve noticed that what’s being clamored for is a set of rescue remedies – miracles even – that will allow us to keep living exactly the way we’re accustomed to in the USA, with all the trappings of comfort and convenience now taken as entitlements. I don’t believe that this will be remotely possible, so I avoid the term “solutions” entirely and suggest that we speak instead of “intelligent responses” to our changing circumstances. This implies that our well-being depends on our own behavior and the choices that we make, not on the lucky arrival of just-in-time miracles. It is an active stance, not a passive one. What will we do?
…
Clusterfuck Nation ThinkTank’s 2010 Forecast: Definitely Not Rosy
by Zero Hedge - December 30th, 2009 12:51 pm
Courtesy of Tyler Durden
As there are less than 48 hours in 2009, which everyone except Goldman’s bonus recipient corps can’t wait to be over, some last minute opinions on what awaits us in 2010. This one comes from James Howard Kunstler, author of the Long Emergency and the Clusterfuck Nation blog. As one can imagine from the title, we don’t anticipate Mr. Kunstler will be making the CNBCOMCAST tour of propaganda duty circuit any time soon.
The Center does Not Hold…But Neither Does the Floor
Introduction
There are always disagreements in a society, differences of opinion, and contested ideas, but I don’t remember any period in my own longish life, even the Vietnam uproar, when the collective sense of purpose, intent, and self-confidence was so muddled in this country, so detached from reality. Obviously, in saying this I’m assuming that I have some reliable notion of what’s real. I admit the possibility that I’m as mistaken as anyone else. But for the purpose of this exercise I’ll ask you to regard me as a reliable narrator. Forecasting is a nasty job, usually thankless, often disappointing – but somebody’s got to do it. There are so many variables in motion, and so much of that motion is driven by randomness, and the best one can do in forecasting amounts to offering up some guesses for whatever they are worth.
I begin by restating my central theme of recent months: that we’re doing a poor job of constructing a coherent consensus about what is happening to us and what we are going to do about it.
There is a great clamor for “solutions” out there. I’ve noticed that what’s being clamored for is a set of rescue remedies – miracles even – that will allow us to keep living exactly the way we’re accustomed to in the USA, with all the trappings of comfort and convenience now taken as entitlements. I don’t believe that this will be remotely possible, so I avoid the term “solutions” entirely and suggest that we speak instead of “intelligent responses” to our changing circumstances. This implies that our well-being depends on our own behavior and the choices that we make, not on the lucky arrival of just-in-time miracles. It is an active stance, not a passive one. What will we do?
…
King Dollar: Don't Call It A Comeback
by Zero Hedge - December 30th, 2009 12:26 pm
Courtesy of Tyler Durden
Submitted by Nic Lenoir of ICAP
We have been forecasting and monitoring USD strength for weeks now. Our main focus has been on GBPUSD, EURUSD, and AUDUSD for which we had the most convincing technical arguments for a sell-off. Today USDCAD is joining the band.
From the recent lows, we have a perfect Elliott structure with an initial impulse (wave I or A), then a sideways flat correction, for which even the substructure is pristine, and we finished the consolidation yesterday forming a quasi morning star right on the 76.4% retracement of wave I/A. Even for those who remain USD bears in the medium term, the target on this upcoming wave III or C is at least 1.1030, which gives us quite a bit of upside potential, especially given how much bullish divergence the market experienced while making the lows.
This USDCAD price action is confirmed by AUDUSD as the pair came back yesterday to test the neckline o the H&S as resistace and rejected it. Target now on the downside is 86.24, but our medium term initial support target remains 0.8260.
Good luck trading,
Nic
King Dollar: Don’t Call It A Comeback
by Zero Hedge - December 30th, 2009 12:26 pm
Courtesy of Tyler Durden
Submitted by Nic Lenoir of ICAP
We have been forecasting and monitoring USD strength for weeks now. Our main focus has been on GBPUSD, EURUSD, and AUDUSD for which we had the most convincing technical arguments for a sell-off. Today USDCAD is joining the band.
From the recent lows, we have a perfect Elliott structure with an initial impulse (wave I or A), then a sideways flat correction, for which even the substructure is pristine, and we finished the consolidation yesterday forming a quasi morning star right on the 76.4% retracement of wave I/A. Even for those who remain USD bears in the medium term, the target on this upcoming wave III or C is at least 1.1030, which gives us quite a bit of upside potential, especially given how much bullish divergence the market experienced while making the lows.
This USDCAD price action is confirmed by AUDUSD as the pair came back yesterday to test the neckline o the H&S as resistace and rejected it. Target now on the downside is 86.24, but our medium term initial support target remains 0.8260.
Good luck trading,
Nic
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