Posts Tagged ‘budget cuts’

Obama No Longer Bothering to Lie Credibly: Claims Financial Crisis Cost Less Than S&L Crisis

Obama No Longer Bothering to Lie Credibly: Claims Financial Crisis Cost Less Than S&L Crisis

Courtesy of Yves Smith at Naked Capitalism 

I’m so offended by the latest Obama canard, that the financial crisis of 2007-2008 cost less than 1% of GDP, that I barely know where to begin. Not only does this Administration lie on a routine basis, it doesn’t even bother to tell credible lies. .And this one came directly from the top, not via minions. It’s not that this misrepresentation is earth-shaking, but that it epitomizes why the Obama Administration is well on its way to being an abject failure.

On the Jon Stewart Show (starting roughly at the 1:10 mark on this segment) Obama claims the cost of this crisis will be less than 1% of GDP, versus 2.5% for the savings and loan crisis (hat tip George Washington, sorry, no embed code, you need to go here):

Picture 3

The reason Obama makes such baldfacedly phony statements is twofold: first, his pattern of seeing PR as the preferred solution to all problems, and second, his resulting slavish devotion to smoke and mirrors over sound policy.

The savings & loan crisis led to FDIC takeovers of dud banks and the creation of a resolution authority to dispose of bad assets. That produced costs which were largely funded by the Federal government. I’ve heard economists repeatedly peg the costs at $110 to $120 billion; Wikipedia puts it at about $150 billion. This approach, of cleaning up and resolving banks, has been found repeatedly to be the fastest and least costly way to contend with a financial crisis.

The reason Obama can claim such phony figures is that many of the costs of saving the financial system are hidden, the biggest being the ongoing transfer from savers to banks of negative real interest rates, which is a covert way…
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CHALLENGER JOB REPORT SHOWS LOW LEVEL OF JOB CUTS, STATE/GOVERNMENT WEAKNESS

CHALLENGER JOB REPORT SHOWS LOW LEVEL OF JOB CUTS, STATE/GOVERNMENT WEAKNESS

Courtesy of The Pragmatic Capitalist 

Investors are looking for a big jobs report this Friday and the early signs from the ISM reports, jobless claims and today’s Challenger job cuts report shows that employment trends are improving. The majority of the weakness in the report is coming from the public sector as the federal and state governments are forced to slash budgets to cut costs.  Approximately 40% of the cuts were at the government level.  Austerity is beginning to spread to the United States.  It will be interesting to see how the private sector is impacted by the sovereign debt crisis over the course of the next few months.  It’s difficult to imagine that the positive trend in job recovery can continue at the rate we were beginning to see in early 2010.

chall CHALLENGER JOB REPORT SHOWS LOW LEVEL OF JOB CUTS, STATE/GOVERNMENT WEAKNESS

Source: Econoday 


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Schwarzenegger’s Budget Addresses Few Structural Issues

Schwarzenegger’s Budget Addresses Few Structural Issues

California Governor Arnold Schwarzenegger proposes his $83.4 billion state budget plan in Sacramento.

Courtesy of Mish 

Tonight, with much fanfare, Schwarzenegger released his proposal to fix California’s $19 billion budget deficit. It was a huge disappointment.

Schwarzenegger had a golden opportunity to propose radical changes like privatizing the prison system, privatizing work in general, sending illegal aliens home, or getting rid of defined benefit plans. Instead, Schwarzenegger wimped out on many key issues.

Budget at a Glance

Please consider some highlights from Schwarzenegger’s revised state budget at a glance

Close the $19.1 Billion Deficit Through:

  • $12.4 billion in spending cuts.
  • $3.4 billion in federal money.
  • $3.3 billion in other measures, primarily through borrowing from other state funds.

Spending Cuts Breakdown

  • $1.1 billion through the elimination of CalWORKS, the state’s primary welfare program, which serves 1.4 million people, two-thirds of them children.
  • $750 million in unspecified cuts to the state’s in-home supportive services program for the disabled, achieved through reductions in wages and services.
  • Cuts $532 million from Medi-Cal, the state’s medical program for the poor, by reducing eligibility, limiting doctor’s visits to 10 per year, reducing funding for hearing aids and other medical equipment, and increasing copays.
  • $811 million reduction in prison health care expenses by making the system more efficient and reducing funding.
  • About $360 million in savings by shifting nonviolent offenders out of state prisons and into county jails and by reducing the juvenile prison population and closing the facilities that house them.

State Employees

  • Payroll reductions of 5 percent across all state departments, except for constitutional offices, which already achieved 5 percent reductions. The administration says much of the payroll reduction can be achieved by departments not filling current vacancies.
  • A 5 percent pay cut for all state workers and a 5 percent increase in their pension contributions. The administration says this will save $1.6 billion.

Media Reporting

As soon as Schwarzenegger released the budget, the media was all over it. The LA Times headline says it all: Schwarzenegger’s budget deals blows to the poor.

Proposing a budget that would eliminate the state’s welfare-to-work program and most child care for the poor, Gov. Arnold Schwarzenegger on Friday outlined a stark vision of a California that would sharply limit aid to some of its poorest and neediest citizens.

His $83.4-billion plan would also freeze funding for local schools, further cut state


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Obama’s Backbone Like Over-Cooked Spaghetti; So Where Are The Fiscal Conservatives?

Obama’s Backbone Like Over-Cooked Spaghetti; So Where Are The Fiscal Conservatives?

Courtesy of Mish  

Please consider 4 visualizations of Obama’s Budget Cuts.

$17 Billion Cuts In Context

Obama Budget Cuts Visualization

Obama’s "Unsustainable Course" (And what he’s NOT doing something about)

Note: There is no audio in the middle portion of this video.

What Does The Federal Budget Freeze Look Like?

For more on budgetary math behind the freeze please see What Does the Federal Budget Freeze Look Like?

The amount saved from this freeze has been consistently reported as $15 billion in the first year and $250 billion over 10 years. I hate the “we’re saving $250 billion over 10 years” line. It is a piece of crass political rhetoric and I’m disappointed that the administration would use it. If they actually implement a three year freeze on the portion of the budget they’re talking about (which is a big if, but let’s assume the best), why measure the effects in the space of 10 years?

The answer is “To make the freeze look bigger”.

They might as well say that they’re saving a trillion dollars over the next 25 years or a hundred trillion over the next 300 years. It is a data statement designed to trick people.

Second, I hate the “We’re saving all this money by not spending it” line because it is similarly political. If a future politician wants to play this stupid numbers game, all they have to do is “project” that they will spend like a crazy person next


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ValueWalk

Managing Investments As A Charity Or Nonprofit

By Anna Peel. Originally published at ValueWalk.

Maintaining financial viability is a constant challenge for charities and nonprofit organizations.

Q4 2020 hedge fund letters, conferences and more

The past year has underscored that challenge. The pandemic has not just affected investment returns – it’s also had serious implications for charitable activities and the ability to fundraise. For some organizations, it’s even raised doubts about whether they can continue to operate.

Finding ways to generate long-term, sustainable returns for ...



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Phil's Favorites

Scientists are on a path to sequencing 1 million human genomes and use big data to unlock genetic secrets

 

Scientists are on a path to sequencing 1 million human genomes and use big data to unlock genetic secrets

A complete human genome, seen here in pairs of chromosomes, offers a wealth of information, but it is hard connect genetics to traits or disease. HYanWong/Wikimedia Comons

Courtesy of Xavier Bofill De Ros, National Institutes of Health

The first draft of the human genome was publ...



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Biotech/COVID-19

Scientists are on a path to sequencing 1 million human genomes and use big data to unlock genetic secrets

 

Scientists are on a path to sequencing 1 million human genomes and use big data to unlock genetic secrets

A complete human genome, seen here in pairs of chromosomes, offers a wealth of information, but it is hard connect genetics to traits or disease. HYanWong/Wikimedia Comons

Courtesy of Xavier Bofill De Ros, National Institutes of Health

The first draft of the human genome was publ...



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Chart School

Money Printing Asset Price Targets

Courtesy of Read the Ticker

The FED giveth and the FED taketh away. Right now the FED is giving a lot into 2022 US Mid Terms. 

Unless the FED breaks the market, here are some BRRRRR asset price targets, not normal price targets but money printing adjusted price targets. 


BITCOIN 175,000 to 500,000 USD

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DOW to 40,000 to 50,000

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More DOW

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Zero Hedge

China Buys US Treasuries For 4th Straight Month Amid Record LTM Inflows Into US Equities

Courtesy of ZeroHedge View original post here.

Amid the worst quarter for Treasuries since 1980, there was at least one big buyer.

For the 4th straight month, China bought US Treasuries in February (the latest period for which we now have data). That is the biggest holding since July 2019 and the longest buying streak since 2017.

Source: Bloomberg

But overall, foreigners were net sellers of Treasuries ...



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Politics

Colombia gives nearly 1 million Venezuelan migrants legal status and right to work

 

Colombia gives nearly 1 million Venezuelan migrants legal status and right to work

Venezuelans wait at the Colombian border to be processed and housed in tents in 2020. All Venezuelans now in Colombia will receive a 10-year residency permit. Schneyder Mendoza/AFP via Getty Images

Courtesy of Erika Frydenlund, Old Dominion University; Jose J. Padilla, Old Dominion University...



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Kimble Charting Solutions

Will Historic Selloff In Treasury Bonds Turn Into Opportunity?

Courtesy of Chris Kimble

Long-dated treasury bonds have been crushed over the past year, sending ETFs like TLT (20+ Year US Treasury Bond ETF) spiraling over 20%.

Improving economy? Inflation concerns? Perhaps a combination of both… interest rates have risen sharply and thus bond prices have fallen in historic fashion.

Today’s chart looks at $TLT over the past 20 years. As you can see, the recent decline has truly been historic. $TLT’s price has swung from historically overbought highs to oversold lows.

At present, the long-dated bond ETF ($TLT) is trading 7.8% below its 200-...



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Digital Currencies

Crypto - The Beginning of The Beginning... and the Coinbase IPO

 

Crypto – The Beginning of The Beginning… and the Coinbase IPO

Courtesy of Howard Lindzon

I am starting to say the ‘beginning of the beginning’ a lot.

Last month I used it in a blog post about active investing.

Bitcoin and Ethereum are a main reason I believe we are at the beginning of the beginning of active investing and the Coinbase ($COIN) direct listing tomorrow [Apr. 14] is likely why we are still just at the beginning of the beginning of crypto and decentralization.

If it was t...



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Mapping The Market

Suez Canal: Critical Waterway Comes to a Halt

 

Suez Canal: Critical Waterway Comes to a Halt

Courtesy of Marcus Lu, Visual Capitalist

The Suez Canal: A Critical Waterway Comes to a Halt

On March 23, 2021, a massive ship named Ever Given became lodged in the Suez Canal, completely blocking traffic in both directions. According to the Suez Canal Authority, the 1,312 foot long (400 m) container ship ran aground during a sandstorm that caused low visibility, impacting the ship’s navigation. The vessel is owned by Taiwanese shipping firm, Evergreen Marine.

With over 2...



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Promotions

Phil's Stock World's Weekly Webinar - March 10, 2021

Don't miss our latest weekly webinar! 

Join us at PSW for LIVE Webinars every Wednesday afternoon at 1:00 PM EST.

Phil's Stock World's Weekly Webinar – March 10, 2021

 

Major Topics:

00:00:01 - EIA Petroleum Status Report
00:04:42 - Crude Oil WTI
00:12:52 - COVID-19 Update
00:22:08 - Bonds and Borrowed Funds | S&P 500
00:45:28 - COVID-19 Vaccination
00:48:32 - Trading Techniques
00:50:34 - PBR
00:50:43 - LYG
00:50:48 - More Trading Techniques
00:52:59 - Chinese Hacks Microsoft's E...



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The Technical Traders

Adaptive Fibonacci Price Modeling System Suggests Market Peak May Be Near

Courtesy of Technical Traders

Our Adaptive Fibonacci Price Modeling system is suggesting a moderate price peak may be already setting up in the NASDAQ while the Dow Jones, S&P500, and Transportation Index continue to rally beyond the projected Fibonacci Price Expansion Levels.  This indicates that capital may be shifting away from the already lofty Technology sector and into Basic Materials, Financials, Energy, Consumer Staples, Utilities, as well as other sectors.

This type of a structural market shift indicates a move away from speculation and towards Blue Chip returns. It suggests traders and investors are expecting the US consumer to come back strong (or at least hold up the market at...



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Lee's Free Thinking

Texas, Florida, Arizona, Georgia - The Branch COVIDIANS Are Still Burning Down the House

 

Texas, Florida, Arizona, Georgia – The Branch COVIDIANS Are Still Burning Down the House

Courtesy of Lee Adler, WallStreetExaminer 

The numbers of new cases in some of the hardest hit COVID19 states have started to plateau, or even decline, over the past few days. A few pundits have noted it and concluded that it was a hopeful sign. 

Is it real or is something else going on? Like a restriction in the numbers of tests, or simply the inability to test enough, or are some people simply giving up on getting tested? Because as we all know from our dear leader, the less testing, the less...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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