Recent hearings in the United States Senate have led to talk of bailouts for subprime borrowers spurring a "Stop the Subprime Bailout" letter writing campaign from long-time Bay Area housing bubble watcher Patrick Killelea at Patrick.net.
WASHINGTON (MarketWatch) — For the first time in the nation’s history, a significant number of Americans are being threatened with the loss of their home even though they still have a steady, good-paying job.
It’s not just an issue for people with poor credit, those with subprime loans. It also affects people with good enough credit to qualify for a prime loan. Known as Alt-A mortgages, these loans were written for 1 in 5 U.S. mortgages and could have a big impact on the economy and on credit markets — bigger, perhaps, than the effects of the recent shockwaves buffeting the subprime-lender market, economists say.
In coming months and years, the credit crunch that’s now squeezing mainly the poor is likely to hit millions of middle-class homeowners who took out risky loans during the great housing boom earlier in the decade. More than 1 million families will lose their homes in the next few years, by one estimate. Another study predicts 2.2 million foreclosures.
This threat is new in American history. Its impact on the economy, and upon the American Dream, is uncertain.
In the past, homeowners have generally lost their home to foreclosure only when they suffered a major life-changing event, such as loss of their job, a major illness or death of a family member. A big jump in foreclosures was unheard of outside a recession that brought high unemployment.
But now, because of the recent popularity of loans geared to let people buy a more expensive home than they can truly afford, all it will take is the passage of time to trigger a default. At some point, all these loans are adjusted to switch from a low, subsidized monthly payment to the full amount required to pay off the loan.
Posted by Marc Rosenberg
Efforts by major banks and Wall Street firms to unload bad U.S. housing loans are speeding up a shakeout in the subprime mortgage industry.
As more Americans fall behind on mortgage payments, Merrill Lynch & Co., J.P. Morgan Chase & Co., HSBC Holdings PLC and others are trying to force mortgage originators to buy back the same high-risk, high-return loans that the big banks eagerly bought in 2005 and 2006.
Merrill demanded in December that ResMae Mortgage Corp. — which in 2006 sold it $3.5 billion in subprime mortgage loans, or loans to borrowers with poor credit records — buy back $308 million of loans whose borrowers had defaulted. In a filing this week for bankruptcy law protection, ResMae said those demands "crippled" its operations. The Brea, Calif., company said that repurchase requests were "severe and unexpected."
Despite regulators’ warnings that some popular types of mortgages are risky, lenders are still making them, and mortgage insurance companies have begun pleading with federal banking agencies to act quickly to restrict them.
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HUD NewsWordPress database error: [MySQL server has gone away]
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Churchill\'s sentencing is scheduled for Aug. 24.<br><br><hr>\";s:8:\"summary#\";i:1;s:7:\"summary\";s:1295:\"Prosecutors in several mortgage-related criminal cases involving hundreds of millions of dollars have produced indictments, plea agreements and convictions. Attention was drawn to some of the cases because the banks where the crooked executives worked applied for federal bailout funds. Some of the defendants have been sentenced to more than a decade in prison.<br><br>A guilty plea was made on May 9 by former Bank of Commonwealth vice president Jeremy C. Churchill, according to the Office of the Special Inspector General for the Troubled Asset Relief Program. Churchill and another bank executive are accused of helping a distressed small business owner cover up delinquency on $8 million in loans by trying to help him fraudulently obtain another $5.1 million that was supposed to be used for pre-development costs for an office tower and the acquisition of a partially completed condominium project.<br><br>Churchill\'s actions contributed to the September 2011 failure of the Norfolk, Va.-based bank at an estimated of $268 million to the Federal Deposit Insurance Corp. The case fell under SIGTARP\'s jurisdiction as a result of a withdrawn November 2008 application for $28 million from the Troubled Asset Relief Program. Churchill\'s sentencing is scheduled for Aug. 24.<br><br><hr>\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337652720;}i:1;a:14:{s:6:\"title#\";i:1;s:5:\"title\";s:34:\"New Delinquencies Inch Higher\";s:5:\"link#\";i:1;s:4:\"link\";s:63:\"http://www.mortgagedaily.com/Delinquency052112LP.asp?spcode=rss\";s:5:\"guid#\";i:1;s:4:\"guid\";s:63:\"http://www.mortgagedaily.com/Delinquency052112LP.asp?spcode=rss\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:28:\"Mon., 21 May 2012 22:45 GMT\";s:12:\"description#\";i:1;s:11:\"description\";s:402:\"Following four consecutive months of improvement, residential delinquency moved higher last month. Behind the deterioration were newly past-due loans.<br><br>The 30-day delinquency rate was 3 basis points higher during April than a month earlier. The figure included loans in the process of foreclosure.<br><br>The number of past-due home loans worked out to 5,570,000 delinquent mortgages.<br><br><hr>\";s:8:\"summary#\";i:1;s:7:\"summary\";s:402:\"Following four consecutive months of improvement, residential delinquency moved higher last month. Behind the deterioration were newly past-due loans.<br><br>The 30-day delinquency rate was 3 basis points higher during April than a month earlier. The figure included loans in the process of foreclosure.<br><br>The number of past-due home loans worked out to 5,570,000 delinquent mortgages.<br><br><hr>\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337640300;}i:2;a:14:{s:6:\"title#\";i:1;s:5:\"title\";s:58:\"Firms See Opportunity in MGIC\'s Exit from Website Business\";s:5:\"link#\";i:1;s:4:\"link\";s:64:\"http://www.mortgagedaily.com/MgicWebsites052112LP.asp?spcode=rss\";s:5:\"guid#\";i:1;s:4:\"guid\";s:64:\"http://www.mortgagedaily.com/MgicWebsites052112LP.asp?spcode=rss\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:28:\"Mon., 21 May 2012 19:22 GMT\";s:12:\"description#\";i:1;s:11:\"description\";s:753:\"At least two companies hope to capitalize on Mortgage Guaranty Insurance Corp.\'s upcoming exit from the business of providing websites for mortgage loan originators. One of the replacement offerings promises to boost lead generation results.<br><br>MGIC got into the website business in January 2006 with its acquisition of Myers Internet Inc., which provided point-of-sale solutions for mortgage originators and real estate agents.<br><br>"By acquiring Myers, MGIC can bring further efficiencies to mortgage lending," MGIC Investment Corp. Chairman, President and Chief Executive Officer Curt S. Culver said in a statement at the time of the acquisition. "This will benefit our customers and ultimately homebuyers."<br><br><hr>\";s:8:\"summary#\";i:1;s:7:\"summary\";s:753:\"At least two companies hope to capitalize on Mortgage Guaranty Insurance Corp.\'s upcoming exit from the business of providing websites for mortgage loan originators. One of the replacement offerings promises to boost lead generation results.<br><br>MGIC got into the website business in January 2006 with its acquisition of Myers Internet Inc., which provided point-of-sale solutions for mortgage originators and real estate agents.<br><br>"By acquiring Myers, MGIC can bring further efficiencies to mortgage lending," MGIC Investment Corp. Chairman, President and Chief Executive Officer Curt S. Culver said in a statement at the time of the acquisition. "This will benefit our customers and ultimately homebuyers."<br><br><hr>\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337628120;}i:3;a:14:{s:6:\"title#\";i:1;s:5:\"title\";s:69:\"New PHH Mortgage President Hired from Outside Industry\";s:5:\"link#\";i:1;s:4:\"link\";s:68:\"http://www.mortgagedaily.com/PhhPresident052112LP.asp?spcode=blogger\";s:5:\"guid#\";i:1;s:4:\"guid\";s:68:\"http://www.mortgagedaily.com/PhhPresident052112LP.asp?spcode=blogger\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:28:\"Mon., 21 May 2012 17:36 GMT\";s:12:\"description#\";i:1;s:11:\"description\";s:429:\"The new president of PHH Mortgage Corp. was recruited from outside the mortgage business.<br><br>Luke S. Hayden resigned as president of the Mt. Laurel, N.J.-based lender in March -- just two months after the resignation of Jerry Selitto as chief executive officer of parent PHH Corp.<br><br>PHH Chief Risk Officer Smriti Laxman Popenoe stepped in as interim president to oversee the mortgage business.<br><br><hr>\";s:8:\"summary#\";i:1;s:7:\"summary\";s:429:\"The new president of PHH Mortgage Corp. was recruited from outside the mortgage business.<br><br>Luke S. Hayden resigned as president of the Mt. Laurel, N.J.-based lender in March -- just two months after the resignation of Jerry Selitto as chief executive officer of parent PHH Corp.<br><br>PHH Chief Risk Officer Smriti Laxman Popenoe stepped in as interim president to oversee the mortgage business.<br><br><hr>\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337621760;}i:4;a:14:{s:6:\"title#\";i:1;s:5:\"title\";s:52:\"3 Consecutive Quarters of Mortgage Employment Growth\";s:5:\"link#\";i:1;s:4:\"link\";s:62:\"http://www.mortgagedaily.com/PressRelease052112.asp?spcode=rss\";s:5:\"guid#\";i:1;s:4:\"guid\";s:62:\"http://www.mortgagedaily.com/PressRelease052112.asp?spcode=rss\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:28:\"Mon., 20 May 2012 03:47 GMT\";s:12:\"description#\";i:1;s:11:\"description\";s:354:\"Mortgage industry staffing has expanded each of the past three quarters, according to the <i>First-Quarter 2012 Mortgage Employment Index</i> from <i>Mortgage Daily</i>.<br><br>Hirings outpaced layoffs by 2,146 during the first three months of 2012.<br><br>Mortgage employment swung from a first-quarter 2011 net loss of more than 1,800 jobs.<br><br><hr>\";s:8:\"summary#\";i:1;s:7:\"summary\";s:354:\"Mortgage industry staffing has expanded each of the past three quarters, according to the <i>First-Quarter 2012 Mortgage Employment Index</i> from <i>Mortgage Daily</i>.<br><br>Hirings outpaced layoffs by 2,146 during the first three months of 2012.<br><br>Mortgage employment swung from a first-quarter 2011 net loss of more than 1,800 jobs.<br><br><hr>\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337485620;}}s:7:\"channel\";a:15:{s:6:\"title#\";i:1;s:5:\"title\";s:43:\"MortgageDaily.com - Mortgage News Headlines\";s:5:\"link#\";i:1;s:4:\"link\";s:39:\"http://www.mortgagedaily.com?spcode=rss\";s:12:\"description#\";i:1;s:11:\"description\";s:48:\"Mortgage Industry News for the Mortgage Industry\";s:14:\"lastbuilddate#\";i:1;s:13:\"lastbuilddate\";s:28:\"Tue., 22 May 2012 02:12 GMT\";s:4:\"atom\";a:5:{s:5:\"link#\";i:1;s:5:\"link@\";s:13:\"href,rel,type\";s:9:\"link@href\";s:36:\"http://www.mortgagedaily.com/rss.xml\";s:8:\"link@rel\";s:4:\"self\";s:9:\"link@type\";s:19:\"application/rss+xml\";}s:9:\"language#\";i:1;s:8:\"language\";s:5:\"en-us\";s:8:\"tagline#\";i:1;s:7:\"tagline\";s:48:\"Mortgage Industry News for the Mortgage Industry\";s:9:\"subtitle#\";i:1;s:8:\"subtitle\";s:48:\"Mortgage Industry News for the Mortgage Industry\";}s:9:\"textinput\";a:0:{}s:5:\"image\";a:0:{}s:9:\"feed_type\";s:3:\"RSS\";s:12:\"feed_version\";s:3:\"2.0\";s:8:\"encoding\";s:5:\"UTF-8\";s:16:\"_source_encoding\";s:0:\"\";s:5:\"ERROR\";s:0:\"\";s:7:\"WARNING\";s:0:\"\";s:24:\"_ATOM_CONTENT_CONSTRUCTS\";a:8:{i:0;s:7:\"content\";i:1;s:7:\"summary\";i:2;s:5:\"title\";i:3;s:4:\"info\";i:4;s:7:\"tagline\";i:5;s:9:\"copyright\";i:6;s:6:\"rights\";i:7;s:8:\"subtitle\";}s:25:\"_XHTML_CONTENT_CONSTRUCTS\";a:2:{i:0;s:4:\"body\";i:1;s:3:\"div\";}s:16:\"_KNOWN_ENCODINGS\";a:3:{i:0;s:5:\"UTF-8\";i:1;s:8:\"US-ASCII\";i:2;s:10:\"ISO-8859-1\";}s:5:\"stack\";a:0:{}s:9:\"inchannel\";b:0;s:6:\"initem\";b:0;s:9:\"incontent\";a:0:{}s:11:\"exclude_top\";b:0;s:11:\"intextinput\";b:0;s:7:\"inimage\";b:0;s:17:\"current_namespace\";b:0;s:16:\"current_category\";i:0;s:13:\"last_modified\";s:31:\"Tue, 22 May 2012 02:09:44 GMT
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UPDATE wp_options SET option_value = 'O:9:\"MagpieRSS\":26:{s:6:\"parser\";i:0;s:12:\"current_item\";a:0:{}s:5:\"items\";a:25:{i:0;a:21:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-7141069306520589939\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Mon, 21 May 2012 18:02:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-21T13:05:58.876-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:96:\"Comments from Italy on \"Financial Terrorism\", Taxes, General Economic Condition, and Mario Monti\";s:12:\"description#\";i:1;s:11:\"description\";s:6960:\"bFinancial Terrorism/bbr /
br /
Reader Andrea from Italy (who now lives in France) has some interesting comments regarding my post on Saturday a href=\"http://globaleconomicanalysis.blogspot.com/2012/05/italy-deploys-20000-law-enforcement.html\"Italy Deploys 20,000 Law Enforcement Officers to Protect Individuals and Sensitive Sites; Anecdotes From Italy via Canada: Taxed Out of House and Home/a.br /
br /
Andrea writes ...br /
blockquote
Hi Mish,br /
br /
I would like to give your readers a better understanding of terrorism in Italy.
Italy went through the seventies with a very hard season of terrorist acts.br /
br /
In the worst period you could count one terrorist act per day: killing or bombing of politicians, managers, journalists and trade unions representatives. The main terrorist organization during those years were the \"Brigate Rosse\" (Red Brigades).br /
br /
The climax happened when they managed to kidnap, jail and eventually kill the a href=\"http://en.wikipedia.org/wiki/Kidnapping_of_Aldo_Moro\"Italian PM Aldo Moro/a. Their \"five point star\" logo is still today symbol of fear and terror in the country.br /
br /
Along with the \"Brigate Rosse\", other minor far-left armed organizations have been spreading terror in the country and also many far-right organizations. An involvement of Italian and US intelligence has sometimes been guessed for some these acts. Those years passed to history as the \"years of lead\", by the metal bullets are made of.br /
br /
The period of terrorism roughly ended in 1982 with the liberation of US Army Gen. Dozier, kidnapped by Red Brigades. Most of their masterminds and killers have been caught and put in jail or spontaneously surrendered by that time.br /
br /
Since then, from time to time, some acts are still claimed by Red Brigades.br /
br /
So the matter of terrorist acts is very, very sensitive in Italy. Unfortunately, the difficult economic environment creates the conditions for a comeback of terrorism.br /
br /
Best regards,br /
Andrea/blockquotebGeneral Economic Conditions, Taxes, and Mario Monti/bbr /
br /
In a followup on general economic conditions Andrea writes ...br /
blockquote
Hi Mish,br /
br /
I was in Italy a couple of weeks ago and so I have some fresh updates.br /
br /
The article you mention is mostly correct, but it is worth to add some things and some facts to describe the full picture.br /
br /
For starters, Italy has a very long and strong \"habit\" of tax evasion and tax fraud compounded by an extremely high level of criminal activities and presence of criminal organizations in the economy. br /
br /
This \"habit\" goes far beyond the economically difficult circumstances, and includes professionals (dentists, doctors, lawyers), retailers and small business.br /
br /
The phenomenon is so widespread and dramatic that a few figures should help explaining it. Statistics show that owners of luxury cars, yachts or private planes declare in average very few tens of thousands Euros income per year, much less of the value of the objects they own. Clearly, this is simply mathematically impossible!br /
br /
So far, no government has been able to tackle this issue, for a lack of will and a lack of capacity at the same time. But increasing debt, pressure from financial markets and increasing spending has increased so much the fiscal pressure on those that cannot evade that the problem now could no longer be avoided.br /
br /
The recent governments have put in place a more and more efficient organization to fight this phenomenon and Prime Minister Mario Monti has now empowered this organization with powers that are really at the limit of democracy, a kind of Orwellian powers including some of the things you see described in the article but also much more. For example, the state now has the power to look into your bank account at any moment without any intervention from your bank.br /
br /
In principle I do not like these enforcements, as it sounds quite tyrannical but at the same time nothing else seemed to work so far.br /
br /
Coming back to the point: restoring fiscal loyalty is absolutely necessary for Italy and those measures seem to have effect to this respect.br /
br /
The problem is that this \"fiscal machine\" is not making any difference between a fiscal fraud or robbery and simple problems of people that cannot pay because they have no money and they have troubles with their firms.br /
br /
The latter group should be helped to keep their companies alive during these troubled times. Instead, stories of people that commit suicide after getting a tough payment request from \"Agenzia delle Entrate\" can be heard almost every day in Italy along with weapon aggression to “Agenzia delle Entrate†employees.br /
br /
While a fair tax system is needed, this way is going to kill Italian companies.br /
br /
As I said, nearly every day you can hear and read about entrepreneur suicide stories in the mainstream media. Even Monti had to comment in a press conference.br /
br /
A mix of things is responsible for this desperation.br /
br /
ul
liPublic Administration delayed payments. PA in Italy is currently years behind in payment./li
liPrivate customers payment delays or non-payments/li
liBank unwilling or unable to make loans/li
liTaxes and tough demands from the new \"fiscal machine\"/li
liLack of demand in the wake of austerity measures, tax hikes, and general European slowdown/li
/ul
br /
Note the injustice: Central and local governments are agonizingly slow (as in years late) in paying bills but now demand citizens to pay immediately.br /
br /
Monti approval is now rapidly declining because of tax increases and because of waste of public money.br /
br /
Best regards,br /
Andrea/blockquote
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-7141069306520589939?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
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a href=\"http://feedads.g.doubleclick.net/~a/iOKn0hJHaRViRsz9Hao0LU0RHS8/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/iOKn0hJHaRViRsz9Hao0LU0RHS8/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:122:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/eCc6_QhMEiE/financial-terrorism-reader-andrea-from.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:94:\"http://globaleconomicanalysis.blogspot.com/2012/05/financial-terrorism-reader-andrea-from.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:6960:\"bFinancial Terrorism/bbr /
br /
Reader Andrea from Italy (who now lives in France) has some interesting comments regarding my post on Saturday a href=\"http://globaleconomicanalysis.blogspot.com/2012/05/italy-deploys-20000-law-enforcement.html\"Italy Deploys 20,000 Law Enforcement Officers to Protect Individuals and Sensitive Sites; Anecdotes From Italy via Canada: Taxed Out of House and Home/a.br /
br /
Andrea writes ...br /
blockquote
Hi Mish,br /
br /
I would like to give your readers a better understanding of terrorism in Italy.
Italy went through the seventies with a very hard season of terrorist acts.br /
br /
In the worst period you could count one terrorist act per day: killing or bombing of politicians, managers, journalists and trade unions representatives. The main terrorist organization during those years were the \"Brigate Rosse\" (Red Brigades).br /
br /
The climax happened when they managed to kidnap, jail and eventually kill the a href=\"http://en.wikipedia.org/wiki/Kidnapping_of_Aldo_Moro\"Italian PM Aldo Moro/a. Their \"five point star\" logo is still today symbol of fear and terror in the country.br /
br /
Along with the \"Brigate Rosse\", other minor far-left armed organizations have been spreading terror in the country and also many far-right organizations. An involvement of Italian and US intelligence has sometimes been guessed for some these acts. Those years passed to history as the \"years of lead\", by the metal bullets are made of.br /
br /
The period of terrorism roughly ended in 1982 with the liberation of US Army Gen. Dozier, kidnapped by Red Brigades. Most of their masterminds and killers have been caught and put in jail or spontaneously surrendered by that time.br /
br /
Since then, from time to time, some acts are still claimed by Red Brigades.br /
br /
So the matter of terrorist acts is very, very sensitive in Italy. Unfortunately, the difficult economic environment creates the conditions for a comeback of terrorism.br /
br /
Best regards,br /
Andrea/blockquotebGeneral Economic Conditions, Taxes, and Mario Monti/bbr /
br /
In a followup on general economic conditions Andrea writes ...br /
blockquote
Hi Mish,br /
br /
I was in Italy a couple of weeks ago and so I have some fresh updates.br /
br /
The article you mention is mostly correct, but it is worth to add some things and some facts to describe the full picture.br /
br /
For starters, Italy has a very long and strong \"habit\" of tax evasion and tax fraud compounded by an extremely high level of criminal activities and presence of criminal organizations in the economy. br /
br /
This \"habit\" goes far beyond the economically difficult circumstances, and includes professionals (dentists, doctors, lawyers), retailers and small business.br /
br /
The phenomenon is so widespread and dramatic that a few figures should help explaining it. Statistics show that owners of luxury cars, yachts or private planes declare in average very few tens of thousands Euros income per year, much less of the value of the objects they own. Clearly, this is simply mathematically impossible!br /
br /
So far, no government has been able to tackle this issue, for a lack of will and a lack of capacity at the same time. But increasing debt, pressure from financial markets and increasing spending has increased so much the fiscal pressure on those that cannot evade that the problem now could no longer be avoided.br /
br /
The recent governments have put in place a more and more efficient organization to fight this phenomenon and Prime Minister Mario Monti has now empowered this organization with powers that are really at the limit of democracy, a kind of Orwellian powers including some of the things you see described in the article but also much more. For example, the state now has the power to look into your bank account at any moment without any intervention from your bank.br /
br /
In principle I do not like these enforcements, as it sounds quite tyrannical but at the same time nothing else seemed to work so far.br /
br /
Coming back to the point: restoring fiscal loyalty is absolutely necessary for Italy and those measures seem to have effect to this respect.br /
br /
The problem is that this \"fiscal machine\" is not making any difference between a fiscal fraud or robbery and simple problems of people that cannot pay because they have no money and they have troubles with their firms.br /
br /
The latter group should be helped to keep their companies alive during these troubled times. Instead, stories of people that commit suicide after getting a tough payment request from \"Agenzia delle Entrate\" can be heard almost every day in Italy along with weapon aggression to “Agenzia delle Entrate†employees.br /
br /
While a fair tax system is needed, this way is going to kill Italian companies.br /
br /
As I said, nearly every day you can hear and read about entrepreneur suicide stories in the mainstream media. Even Monti had to comment in a press conference.br /
br /
A mix of things is responsible for this desperation.br /
br /
ul
liPublic Administration delayed payments. PA in Italy is currently years behind in payment./li
liPrivate customers payment delays or non-payments/li
liBank unwilling or unable to make loans/li
liTaxes and tough demands from the new \"fiscal machine\"/li
liLack of demand in the wake of austerity measures, tax hikes, and general European slowdown/li
/ul
br /
Note the injustice: Central and local governments are agonizingly slow (as in years late) in paying bills but now demand citizens to pay immediately.br /
br /
Monti approval is now rapidly declining because of tax increases and because of waste of public money.br /
br /
Best regards,br /
Andrea/blockquote
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-7141069306520589939?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/iOKn0hJHaRViRsz9Hao0LU0RHS8/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/iOKn0hJHaRViRsz9Hao0LU0RHS8/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/iOKn0hJHaRViRsz9Hao0LU0RHS8/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/iOKn0hJHaRViRsz9Hao0LU0RHS8/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337623320;}i:1;a:22:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-8113521332986304112\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Mon, 21 May 2012 06:58:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-21T01:58:39.467-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:172:\"Full-Fledged European Bank Run; ECB Deposit Insurance is Not the Answer; How FDIC Played a Part in the US Real Estate Bust; Monetarist Fools are Everywhere; Believe in Gold\";s:12:\"description#\";i:1;s:11:\"description\";s:8114:\"One chart is all it takes to prove a full-fledged European bank run on the banks is well underway in the Club-Med countries and Ireland.br /
br /
a href=\"http://1.bp.blogspot.com/-tEnNyExC-As/T7nSG9J2kpI/AAAAAAAAPOk/FZ1j__xw8vw/s1600/Target%2B2%2Bbalances%2B2012-05-21.png\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"299\" src=\"http://1.bp.blogspot.com/-tEnNyExC-As/T7nSG9J2kpI/AAAAAAAAPOk/FZ1j__xw8vw/s400/Target%2B2%2Bbalances%2B2012-05-21.png\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
The above chart is from the Financial Times article The a href=\"http://blogs.ft.com/gavyndavies/2012/05/20/the-anatomy-of-the-eurozone-bank-run/#axzz1vSKCiBSS\" target=\"_blank\"anatomy of the eurozone bank run/a by Gavyn Davies.br /
blockquote
A bank run is now happening within the eurozone. So far it has been relatively slow and prolonged, but it is a run nonetheless. And last week, it showed signs of accelerating sharply, in a way which demands an urgent response from policy-makers.br /
br /
The fear of bank runs is deeply ingrained in all economists who know anything about the genesis of the Great Depression in the United States in the early 1930s. Then, the failure of the Bank of United States in December 1930 led to multiple bank runs across the country. Bank failures in the following two years wiped out personal savings and greatly exacerbated the collapse of demand in the economy.br /
br /
The classic account of the crisis, by Milton Friedman and Anna Schwartz, concluded that the collapse was largely the fault of the Federal Reserve, which failed to provide enough liquidity to keep the banks functioning and thus end the panic. /blockquote
bClassical Nonsense/bbr /
br /
We need to stop right there for a bit because the \"classic account\" Davies believes in is complete nonsense. The crisis then and now is a crisis of solvency.br /
br /
The culprit is fractional reserve lending coupled with fraudulent lending practices that allow banks to secure deposits for 2 years or less but lend money out for 30 years.br /
br /
The way to stop runs on the bank is easy enough: stop fractional reserve lending and other fraudulent lending practices.br /
br /
Davies continues with still more nonsense.br /
blockquote
After the crash, the establishment of the Federal Deposit Insurance Corporation was intended to ensure that deposit holders never again had to live in fear that their savings would be in jeopardy. What are the lessons for the eurozone?/blockquote
bHow FDIC Played a Part in the US Real Estate Bust/bbr /
br /
Clearly there was fear depositors would lose money and the run on Lehman and Bear Stearns is proof enough.br /
br /
The irony isnbsp; there was no fear for the longest time because of FDIC when fear should be a rational worry. That lack of fear led to depositors chasing the highest yields simply because they were government guaranteed.br /
br /
For example, Corus bank (among numerous others) offered attractive rates and invested deposits in condo construction schemes in Florida, California, and Las Vegas. Were it not for FDIC, no one in their right mind would have put deposits at Corus and other such banks that went bust in the real estate crash.br /
br /
The fools who did place deposits at such banks seeking higher yields deserved to lose those deposits.br /
br /
bEnd Fractional Reserve Lending/bbr /
br /
Under a full-reserve 100% gold-backed banking system, inflation would be nonexistent and bank failures would be few and scattered. Instead, we have seen boom-bust cycles of increasing magnitude with faith placed on FDIC, and that faith contributed to the magnitude of the bust and an enormous failure of hundreds of banks in a short period of time.br /
br /
In short FDIC should be phased out along with the end of fractional reserve lending.br /
br /
The rest of Davies\' article is a hodge-podge of still more fallacies concluding with ...br /
blockquote
Mario Monti apparently took a plan to the G8 summit to offer jointly-funded guarantees on bank deposits to apply across the entire eurozone. This would certainly help, but whether it would be sufficient to eliminate fears of exchange rate losses if the euro were to disintegrate is another matter. To fix that problem, belief in the integrity of the euro as a single currency needs to be restored. The bank run could bring matters to a head./blockquote
bBelief in the Euro? Why?nbsp;/bbr /
br /
Pray tell why should there be a belief in the Euro, especially when the \"solution\" proposed by Keynsian and Monetarist clowns is simply to print more money to cover fraudulent lending practices by banks, every time banks get into trouble?br /
br /
bBelief in Gold/bbr /
br /
Note that the US dollar index is right where it was over seven years ago. br /
br /
a href=\"http://2.bp.blogspot.com/-ja42PpW7e1k/T7ngC7zL26I/AAAAAAAAPO4/TBvf7zl4wjE/s1600/US%2524%2BIndex%2B2012-05-21.png\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"266\" src=\"http://2.bp.blogspot.com/-ja42PpW7e1k/T7ngC7zL26I/AAAAAAAAPO4/TBvf7zl4wjE/s400/US%2524%2BIndex%2B2012-05-21.png\" width=\"400\" //abr /
br /
The US$ index is at a spot first touched in late 2004. Gold was well under $500 an ounce at that time, so please do not tell me gold is a function of the US dollar.br /
br /
a href=\"http://3.bp.blogspot.com/-YKOeNAiCASg/T7nkaGez_tI/AAAAAAAAPPM/Z5W4LvUrY-o/s1600/Gold%2BMonthly%2B2012-05-21.png\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"271\" src=\"http://3.bp.blogspot.com/-YKOeNAiCASg/T7nkaGez_tI/AAAAAAAAPPM/Z5W4LvUrY-o/s400/Gold%2BMonthly%2B2012-05-21.png\" width=\"400\" //abr /
br /
One of the reasons gold is at $1600 with the US dollar index above 81 is
precisely because central banks in general (notably the Fed, the ECB,
the Bank of England, and China) have printed nonstop and the Fed and the
ECB have initiated all sorts of liquidity and QE measures. In addition,
the ECB\'s balance sheet is more bloated than the balance sheet of the
Fed thanks to the LTRO program.nbsp; br /
br /
bIntegrity of Gold/bbr /
br /
The proper conclusion is that gold is a function of mistrust in fiat currencies in general, not just the US dollar. However, nothing moves in a straight line including faith (or lack thereof) in central banks\' ability to handle this crisis.br /
br /
By now it should be perfectly obvious the LTRO is a complete failure. Banks in Spain took the money and bought more of their own bonds and are now underwater on them.br /
br /
Only monetarist fools want the ECB to do more of the same. Sadly, monetarist fools are nearly everywhere, and the chart of the price of gold says just that.br /
br /
In conclusion, if the ECB was to take the action suggested by Davies (and they might), it certainly will do nothing for the \"integrity of the euro\", but it is highly likely to further the integrity of gold.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-8113521332986304112?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/KMGcoVt8T5UdXQdTYgLF1lh2l-c/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/KMGcoVt8T5UdXQdTYgLF1lh2l-c/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/KMGcoVt8T5UdXQdTYgLF1lh2l-c/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/KMGcoVt8T5UdXQdTYgLF1lh2l-c/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:118:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/gi7NLTej6d4/full-fledged-european-bank-run-ecb.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:5:\"media\";a:6:{s:10:\"thumbnail#\";i:1;s:10:\"thumbnail@\";s:28:\"xmlns:media,url,height,width\";s:21:\"thumbnail@xmlns:media\";s:29:\"http://search.yahoo.com/mrss/\";s:13:\"thumbnail@url\";s:118:\"http://1.bp.blogspot.com/-tEnNyExC-As/T7nSG9J2kpI/AAAAAAAAPOk/FZ1j__xw8vw/s72-c/Target%2B2%2Bbalances%2B2012-05-21.png\";s:16:\"thumbnail@height\";s:2:\"72\";s:15:\"thumbnail@width\";s:2:\"72\";}s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:90:\"http://globaleconomicanalysis.blogspot.com/2012/05/full-fledged-european-bank-run-ecb.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:8114:\"One chart is all it takes to prove a full-fledged European bank run on the banks is well underway in the Club-Med countries and Ireland.br /
br /
a href=\"http://1.bp.blogspot.com/-tEnNyExC-As/T7nSG9J2kpI/AAAAAAAAPOk/FZ1j__xw8vw/s1600/Target%2B2%2Bbalances%2B2012-05-21.png\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"299\" src=\"http://1.bp.blogspot.com/-tEnNyExC-As/T7nSG9J2kpI/AAAAAAAAPOk/FZ1j__xw8vw/s400/Target%2B2%2Bbalances%2B2012-05-21.png\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
The above chart is from the Financial Times article The a href=\"http://blogs.ft.com/gavyndavies/2012/05/20/the-anatomy-of-the-eurozone-bank-run/#axzz1vSKCiBSS\" target=\"_blank\"anatomy of the eurozone bank run/a by Gavyn Davies.br /
blockquote
A bank run is now happening within the eurozone. So far it has been relatively slow and prolonged, but it is a run nonetheless. And last week, it showed signs of accelerating sharply, in a way which demands an urgent response from policy-makers.br /
br /
The fear of bank runs is deeply ingrained in all economists who know anything about the genesis of the Great Depression in the United States in the early 1930s. Then, the failure of the Bank of United States in December 1930 led to multiple bank runs across the country. Bank failures in the following two years wiped out personal savings and greatly exacerbated the collapse of demand in the economy.br /
br /
The classic account of the crisis, by Milton Friedman and Anna Schwartz, concluded that the collapse was largely the fault of the Federal Reserve, which failed to provide enough liquidity to keep the banks functioning and thus end the panic. /blockquote
bClassical Nonsense/bbr /
br /
We need to stop right there for a bit because the \"classic account\" Davies believes in is complete nonsense. The crisis then and now is a crisis of solvency.br /
br /
The culprit is fractional reserve lending coupled with fraudulent lending practices that allow banks to secure deposits for 2 years or less but lend money out for 30 years.br /
br /
The way to stop runs on the bank is easy enough: stop fractional reserve lending and other fraudulent lending practices.br /
br /
Davies continues with still more nonsense.br /
blockquote
After the crash, the establishment of the Federal Deposit Insurance Corporation was intended to ensure that deposit holders never again had to live in fear that their savings would be in jeopardy. What are the lessons for the eurozone?/blockquote
bHow FDIC Played a Part in the US Real Estate Bust/bbr /
br /
Clearly there was fear depositors would lose money and the run on Lehman and Bear Stearns is proof enough.br /
br /
The irony isnbsp; there was no fear for the longest time because of FDIC when fear should be a rational worry. That lack of fear led to depositors chasing the highest yields simply because they were government guaranteed.br /
br /
For example, Corus bank (among numerous others) offered attractive rates and invested deposits in condo construction schemes in Florida, California, and Las Vegas. Were it not for FDIC, no one in their right mind would have put deposits at Corus and other such banks that went bust in the real estate crash.br /
br /
The fools who did place deposits at such banks seeking higher yields deserved to lose those deposits.br /
br /
bEnd Fractional Reserve Lending/bbr /
br /
Under a full-reserve 100% gold-backed banking system, inflation would be nonexistent and bank failures would be few and scattered. Instead, we have seen boom-bust cycles of increasing magnitude with faith placed on FDIC, and that faith contributed to the magnitude of the bust and an enormous failure of hundreds of banks in a short period of time.br /
br /
In short FDIC should be phased out along with the end of fractional reserve lending.br /
br /
The rest of Davies\' article is a hodge-podge of still more fallacies concluding with ...br /
blockquote
Mario Monti apparently took a plan to the G8 summit to offer jointly-funded guarantees on bank deposits to apply across the entire eurozone. This would certainly help, but whether it would be sufficient to eliminate fears of exchange rate losses if the euro were to disintegrate is another matter. To fix that problem, belief in the integrity of the euro as a single currency needs to be restored. The bank run could bring matters to a head./blockquote
bBelief in the Euro? Why?nbsp;/bbr /
br /
Pray tell why should there be a belief in the Euro, especially when the \"solution\" proposed by Keynsian and Monetarist clowns is simply to print more money to cover fraudulent lending practices by banks, every time banks get into trouble?br /
br /
bBelief in Gold/bbr /
br /
Note that the US dollar index is right where it was over seven years ago. br /
br /
a href=\"http://2.bp.blogspot.com/-ja42PpW7e1k/T7ngC7zL26I/AAAAAAAAPO4/TBvf7zl4wjE/s1600/US%2524%2BIndex%2B2012-05-21.png\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"266\" src=\"http://2.bp.blogspot.com/-ja42PpW7e1k/T7ngC7zL26I/AAAAAAAAPO4/TBvf7zl4wjE/s400/US%2524%2BIndex%2B2012-05-21.png\" width=\"400\" //abr /
br /
The US$ index is at a spot first touched in late 2004. Gold was well under $500 an ounce at that time, so please do not tell me gold is a function of the US dollar.br /
br /
a href=\"http://3.bp.blogspot.com/-YKOeNAiCASg/T7nkaGez_tI/AAAAAAAAPPM/Z5W4LvUrY-o/s1600/Gold%2BMonthly%2B2012-05-21.png\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"271\" src=\"http://3.bp.blogspot.com/-YKOeNAiCASg/T7nkaGez_tI/AAAAAAAAPPM/Z5W4LvUrY-o/s400/Gold%2BMonthly%2B2012-05-21.png\" width=\"400\" //abr /
br /
One of the reasons gold is at $1600 with the US dollar index above 81 is
precisely because central banks in general (notably the Fed, the ECB,
the Bank of England, and China) have printed nonstop and the Fed and the
ECB have initiated all sorts of liquidity and QE measures. In addition,
the ECB\'s balance sheet is more bloated than the balance sheet of the
Fed thanks to the LTRO program.nbsp; br /
br /
bIntegrity of Gold/bbr /
br /
The proper conclusion is that gold is a function of mistrust in fiat currencies in general, not just the US dollar. However, nothing moves in a straight line including faith (or lack thereof) in central banks\' ability to handle this crisis.br /
br /
By now it should be perfectly obvious the LTRO is a complete failure. Banks in Spain took the money and bought more of their own bonds and are now underwater on them.br /
br /
Only monetarist fools want the ECB to do more of the same. Sadly, monetarist fools are nearly everywhere, and the chart of the price of gold says just that.br /
br /
In conclusion, if the ECB was to take the action suggested by Davies (and they might), it certainly will do nothing for the \"integrity of the euro\", but it is highly likely to further the integrity of gold.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-8113521332986304112?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/KMGcoVt8T5UdXQdTYgLF1lh2l-c/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/KMGcoVt8T5UdXQdTYgLF1lh2l-c/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/KMGcoVt8T5UdXQdTYgLF1lh2l-c/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/KMGcoVt8T5UdXQdTYgLF1lh2l-c/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337583480;}i:2;a:21:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-4388207681266232880\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Sun, 20 May 2012 17:07:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-20T12:07:55.489-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:117:\"Fear vs. Anger: Door-to-Door Fear-Mongering in Ireland on Merkozy Referendum; Expect Fear-Mongering in Greece as Well\";s:12:\"description#\";i:1;s:11:\"description\";s:3618:\"Door-to-Door a href=\"http://www.ft.com/intl/cms/s/0/a8a6a8b0-a259-11e1-826a-00144feabdc0.html#axzz1vNIi0fON\" May Drive Irish Towards Yes Vote/a in Referendum on Merkozy Pact.br /
blockquote
In a hard-fought battle to convince Irish voters to back Europe’s unpopular fiscal discipline treaty, Ireland’s deputy finance minister has the task of convincing the leafy Dublin suburb of Templeogue.br /
br /
Going door-to-door, Brian Hayes faces scepticism and occasional abuse. One constituent calls him “a waste of spaceâ€, another “just a yes manâ€.br /
br /
“If Greece goes down we are next in the firing line. I know people who are trying to put their money into US dollars. We just don’t know what is going to happen here,†says Mr O’Reilly.br /
br /
“This referendum is all about fear on the one side and anger on the other,†says David Farrell, professor of politics at University College Dublin. “Most people have no great deal of enthusiasm for it and will only vote reluctantly in this referendum.â€br /
br /
“The sight of soup kitchens in Greece on TV screens is concentrating minds,†says Mr Hayes, as he goes door-to-door hammering home his message.br /
br /
The dominant theme of the campaign so far is a claim by the government that rejecting the treaty would bar Ireland from receiving funds from Europe’s new bailout fund – the European Stability Mechanism. Without this insurance policy, Dublin says, Ireland will struggle to exit its EU and International Monetary Fund bailout programme on schedule at the end of 2013.br /
br /
“The government is scaremongering rather than arguing the merits of the treaty. Most people are opposed to this treaty but are scared out of their wits,†says Paul Murphy, a Socialist member of the European Parliament and prominent No campaigner./blockquote
Nothing bad can possibly happen if this treaty is rejected. Accepting more bailout funds from the IMF or ESM would be the absolute worst thing for Ireland.br /
br /
Indeed, accepting funds from the Troika is one of the things that destroyed Greece, and it is pathetic that clueless, brainless, scare-mongering political shills for Brussels are now going door-to-door in an attempt to convince Irish voters the exact opposite.br /
br /
Heading into the Greek June 17 national elections, expect to see door-to-door fear-mongering in Greece as well.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-4388207681266232880?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/aJtsP6f5N1WgEtM6iB8TuZ72jJ8/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/aJtsP6f5N1WgEtM6iB8TuZ72jJ8/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/aJtsP6f5N1WgEtM6iB8TuZ72jJ8/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/aJtsP6f5N1WgEtM6iB8TuZ72jJ8/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:115:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/UHq2RbPZDC4/fear-vs-anger-door-to-door-fear.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:87:\"http://globaleconomicanalysis.blogspot.com/2012/05/fear-vs-anger-door-to-door-fear.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:3618:\"Door-to-Door a href=\"http://www.ft.com/intl/cms/s/0/a8a6a8b0-a259-11e1-826a-00144feabdc0.html#axzz1vNIi0fON\" May Drive Irish Towards Yes Vote/a in Referendum on Merkozy Pact.br /
blockquote
In a hard-fought battle to convince Irish voters to back Europe’s unpopular fiscal discipline treaty, Ireland’s deputy finance minister has the task of convincing the leafy Dublin suburb of Templeogue.br /
br /
Going door-to-door, Brian Hayes faces scepticism and occasional abuse. One constituent calls him “a waste of spaceâ€, another “just a yes manâ€.br /
br /
“If Greece goes down we are next in the firing line. I know people who are trying to put their money into US dollars. We just don’t know what is going to happen here,†says Mr O’Reilly.br /
br /
“This referendum is all about fear on the one side and anger on the other,†says David Farrell, professor of politics at University College Dublin. “Most people have no great deal of enthusiasm for it and will only vote reluctantly in this referendum.â€br /
br /
“The sight of soup kitchens in Greece on TV screens is concentrating minds,†says Mr Hayes, as he goes door-to-door hammering home his message.br /
br /
The dominant theme of the campaign so far is a claim by the government that rejecting the treaty would bar Ireland from receiving funds from Europe’s new bailout fund – the European Stability Mechanism. Without this insurance policy, Dublin says, Ireland will struggle to exit its EU and International Monetary Fund bailout programme on schedule at the end of 2013.br /
br /
“The government is scaremongering rather than arguing the merits of the treaty. Most people are opposed to this treaty but are scared out of their wits,†says Paul Murphy, a Socialist member of the European Parliament and prominent No campaigner./blockquote
Nothing bad can possibly happen if this treaty is rejected. Accepting more bailout funds from the IMF or ESM would be the absolute worst thing for Ireland.br /
br /
Indeed, accepting funds from the Troika is one of the things that destroyed Greece, and it is pathetic that clueless, brainless, scare-mongering political shills for Brussels are now going door-to-door in an attempt to convince Irish voters the exact opposite.br /
br /
Heading into the Greek June 17 national elections, expect to see door-to-door fear-mongering in Greece as well.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-4388207681266232880?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/aJtsP6f5N1WgEtM6iB8TuZ72jJ8/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/aJtsP6f5N1WgEtM6iB8TuZ72jJ8/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/aJtsP6f5N1WgEtM6iB8TuZ72jJ8/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/aJtsP6f5N1WgEtM6iB8TuZ72jJ8/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337533620;}i:3;a:22:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-9172749011159565019\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Sun, 20 May 2012 06:42:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-20T01:52:20.518-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:118:\"First Time Ever - Majority of Unemployed Have Some College Education; Five Solutions to Education, Student-Loan Crisis\";s:12:\"description#\";i:1;s:11:\"description\";s:5110:\"Those who think the answer to the unemployment problem is more education might be surprised to learn the a href=\"http://news.investors.com/article/611887/201205171857/most-unemployed-are-college-grads-dropouts.htm\" target=\"_blank\"Majority of Unemployed Attended College/a.br /
blockquote
For the first time in history, the number of jobless workers age 25 and up who have attended some college now exceeds the ranks of those who settled for a high school diploma or less.br /
br /
Out of 9 million unemployed in April, 4.7 million had gone to college or graduated and 4.3 million had not, seasonally adjusted Labor Department data show.br /
br /
a href=\"http://1.bp.blogspot.com/-j1vfg53FVxg/T7iG2hV4vOI/AAAAAAAAPOI/VaEJI21vA6M/s1600/education%2Bvs%2Bunemployment.jpg\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"311\" src=\"http://1.bp.blogspot.com/-j1vfg53FVxg/T7iG2hV4vOI/AAAAAAAAPOI/VaEJI21vA6M/s400/education%2Bvs%2Bunemployment.jpg\" width=\"400\" //abr /
br /
click on chart for sharper imagebr /
br /
In 2011, 57% of those 25 and up had attended some college vs. 43% in 1992. Those without a high school diploma fell from 21% to 12% over that span.br /
br /
But along with the increasing prevalence of college attendance has come a growing number of dropouts, who have left school burdened by student loan debt but without much to kick-start their careers.br /
br /
Among everyone up to age 24 who has left college or earned a two-year degree — including those not actively searching — the full-time employment-to-population ratio has plummeted from 69% in 2000 to 62% in 2003 to 54%.br /
br /
This has occurred even as student lending and enrollment at community colleges has soared, elevating the student loan crisis to the center of political debate and a rallying cry for the Occupy Wall Street movement./blockquote
Those who graduated with a four-year degree fared better employment-wise but many of those still struggle with student loans. Many other end up underemployed in retail sector jobs as opposed to the curriculum they studied. br /
br /
Student loans are a trillion dollar problem, and growing every quarter. President Obama wants more student loans, but all that does is make many graduates debt slaves for the rest of their lives.br /
br /
The cost of education is preposterous and the solutions are easy to describe.br /
br /
bFive Solutions/bbr /
br /
ol
liKill federally funded student loan program entirely. Student loans do nothing but drive up the cost of education. Anyone can get a student loan because the loans are guaranteed and cannot be discharged in bankruptcy. The beneficiaries of this horrendous setup are teachers and administrators, not the kids receiving loans./li
liKill state aid to colleges as well /li
liIncrease competition by accrediting more online universities, even foreign universities. This will drive down costs immensely./li
liPublic unions are a huge part of the reason for driving up teacher salaries, so collective bargaining (collective coercion actually), must end./li
liHigh school counselors and parents must educate kids that there simply are no realistic chances for those graduating with degrees in political science, history, English, art, and literally dozens of other useless or nearly-useless majors./li
/ol
br /
The deflationary overhang of student debt is enormous. Those in debt will postpone buying homes, getting married, starting families, and spending money in general.br /
br /
The only solution is to ensure kids to not get into massive debt in the first place. The way to achieve that is to drive down the cost of education.br /
br /
Sadly the Obama administration (like many before it and many at the state level as well) has done nothing but throw money at the problem, rewarding unions and administrators while making debt slaves of kids as education costs spiral out of control.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-9172749011159565019?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/LFT9tB2yeuK5hE0DTSxWcFUHsD8/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/LFT9tB2yeuK5hE0DTSxWcFUHsD8/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/LFT9tB2yeuK5hE0DTSxWcFUHsD8/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/LFT9tB2yeuK5hE0DTSxWcFUHsD8/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:122:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/1AtvS4m30Zw/first-time-ever-majority-of-unemployed.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:5:\"media\";a:6:{s:10:\"thumbnail#\";i:1;s:10:\"thumbnail@\";s:28:\"xmlns:media,url,height,width\";s:21:\"thumbnail@xmlns:media\";s:29:\"http://search.yahoo.com/mrss/\";s:13:\"thumbnail@url\";s:113:\"http://1.bp.blogspot.com/-j1vfg53FVxg/T7iG2hV4vOI/AAAAAAAAPOI/VaEJI21vA6M/s72-c/education%2Bvs%2Bunemployment.jpg\";s:16:\"thumbnail@height\";s:2:\"72\";s:15:\"thumbnail@width\";s:2:\"72\";}s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:94:\"http://globaleconomicanalysis.blogspot.com/2012/05/first-time-ever-majority-of-unemployed.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:5110:\"Those who think the answer to the unemployment problem is more education might be surprised to learn the a href=\"http://news.investors.com/article/611887/201205171857/most-unemployed-are-college-grads-dropouts.htm\" target=\"_blank\"Majority of Unemployed Attended College/a.br /
blockquote
For the first time in history, the number of jobless workers age 25 and up who have attended some college now exceeds the ranks of those who settled for a high school diploma or less.br /
br /
Out of 9 million unemployed in April, 4.7 million had gone to college or graduated and 4.3 million had not, seasonally adjusted Labor Department data show.br /
br /
a href=\"http://1.bp.blogspot.com/-j1vfg53FVxg/T7iG2hV4vOI/AAAAAAAAPOI/VaEJI21vA6M/s1600/education%2Bvs%2Bunemployment.jpg\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"311\" src=\"http://1.bp.blogspot.com/-j1vfg53FVxg/T7iG2hV4vOI/AAAAAAAAPOI/VaEJI21vA6M/s400/education%2Bvs%2Bunemployment.jpg\" width=\"400\" //abr /
br /
click on chart for sharper imagebr /
br /
In 2011, 57% of those 25 and up had attended some college vs. 43% in 1992. Those without a high school diploma fell from 21% to 12% over that span.br /
br /
But along with the increasing prevalence of college attendance has come a growing number of dropouts, who have left school burdened by student loan debt but without much to kick-start their careers.br /
br /
Among everyone up to age 24 who has left college or earned a two-year degree — including those not actively searching — the full-time employment-to-population ratio has plummeted from 69% in 2000 to 62% in 2003 to 54%.br /
br /
This has occurred even as student lending and enrollment at community colleges has soared, elevating the student loan crisis to the center of political debate and a rallying cry for the Occupy Wall Street movement./blockquote
Those who graduated with a four-year degree fared better employment-wise but many of those still struggle with student loans. Many other end up underemployed in retail sector jobs as opposed to the curriculum they studied. br /
br /
Student loans are a trillion dollar problem, and growing every quarter. President Obama wants more student loans, but all that does is make many graduates debt slaves for the rest of their lives.br /
br /
The cost of education is preposterous and the solutions are easy to describe.br /
br /
bFive Solutions/bbr /
br /
ol
liKill federally funded student loan program entirely. Student loans do nothing but drive up the cost of education. Anyone can get a student loan because the loans are guaranteed and cannot be discharged in bankruptcy. The beneficiaries of this horrendous setup are teachers and administrators, not the kids receiving loans./li
liKill state aid to colleges as well /li
liIncrease competition by accrediting more online universities, even foreign universities. This will drive down costs immensely./li
liPublic unions are a huge part of the reason for driving up teacher salaries, so collective bargaining (collective coercion actually), must end./li
liHigh school counselors and parents must educate kids that there simply are no realistic chances for those graduating with degrees in political science, history, English, art, and literally dozens of other useless or nearly-useless majors./li
/ol
br /
The deflationary overhang of student debt is enormous. Those in debt will postpone buying homes, getting married, starting families, and spending money in general.br /
br /
The only solution is to ensure kids to not get into massive debt in the first place. The way to achieve that is to drive down the cost of education.br /
br /
Sadly the Obama administration (like many before it and many at the state level as well) has done nothing but throw money at the problem, rewarding unions and administrators while making debt slaves of kids as education costs spiral out of control.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-9172749011159565019?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/LFT9tB2yeuK5hE0DTSxWcFUHsD8/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/LFT9tB2yeuK5hE0DTSxWcFUHsD8/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/LFT9tB2yeuK5hE0DTSxWcFUHsD8/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/LFT9tB2yeuK5hE0DTSxWcFUHsD8/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337496120;}i:4;a:22:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-1357391549702768191\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Sat, 19 May 2012 16:11:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-19T11:11:58.936-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:63:\"Apparel Sales by Price and Volume Provide Interesting Viewpoint\";s:12:\"description#\";i:1;s:11:\"description\";s:3208:\"Reader Tim Wallace provides an interesting chart of apparel sales in the US by price and by unit volume. In this case, volume is likely the more telling statistic.br /
br /
a href=\"http://4.bp.blogspot.com/-y6i2sH8LA6k/T7fDgCqWuCI/AAAAAAAAPN0/JKGZoHmPZyw/s1600/wallace%2Bapparel%2BImports%2B2012-05.jpg\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"290\" src=\"http://4.bp.blogspot.com/-y6i2sH8LA6k/T7fDgCqWuCI/AAAAAAAAPN0/JKGZoHmPZyw/s400/wallace%2Bapparel%2BImports%2B2012-05.jpg\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
Tim writes ...br /
blockquote
Hi Mishbr /
br /
As always, I am watching imports, especially with fascination the apparel imports. In the attached graph we see that dollars and units run mostly in slope lock-step until the crash of apparel demand in 2009.br /
br /
In 2010 we see a significant \"recovery\". One thing about apparel is it does wear out, so a year like 2009 will cause pent-up demand in a following year. Price did not recover as much however.br /
br /
2011 and the 12 month historical rolling numbers ended in March of 2012 (government data lags two months) is more interesting.br /
br /
Dollar amounts continue to \"recover\" but the units measure has turned well downward again, in fact off 6% from 2010.br /
br /
Looking at the monthly data from this time last year we see a continued degradation of the units amount every month, while the dollars amount trends up.br /
br /
This is in effect apparel inflation, caused partially by raw materials. Cotton has been replaced in a significant percentage of products, stripping out demand and lowering that cost.br /
br /
China lost some market share due to labor cost competition with Vietnam. However, China still dominates with 41.2% of market share, Vietnam second at 8.5%, then Bangladesh at 6.4% and Indonesia at 5.4%.br /
br /
Thus 61.5% of all apparel imports come from only 4 countries.br /
br /
Regards,br /
br /
Tim/blockquote
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-1357391549702768191?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/e2xk39mjdikWZ-3A-1SOwZ-E8Zs/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/e2xk39mjdikWZ-3A-1SOwZ-E8Zs/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/e2xk39mjdikWZ-3A-1SOwZ-E8Zs/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/e2xk39mjdikWZ-3A-1SOwZ-E8Zs/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:117:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/sMzS4JVHtBg/apparel-sales-by-price-and-volume.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:5:\"media\";a:6:{s:10:\"thumbnail#\";i:1;s:10:\"thumbnail@\";s:28:\"xmlns:media,url,height,width\";s:21:\"thumbnail@xmlns:media\";s:29:\"http://search.yahoo.com/mrss/\";s:13:\"thumbnail@url\";s:121:\"http://4.bp.blogspot.com/-y6i2sH8LA6k/T7fDgCqWuCI/AAAAAAAAPN0/JKGZoHmPZyw/s72-c/wallace%2Bapparel%2BImports%2B2012-05.jpg\";s:16:\"thumbnail@height\";s:2:\"72\";s:15:\"thumbnail@width\";s:2:\"72\";}s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:89:\"http://globaleconomicanalysis.blogspot.com/2012/05/apparel-sales-by-price-and-volume.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:3208:\"Reader Tim Wallace provides an interesting chart of apparel sales in the US by price and by unit volume. In this case, volume is likely the more telling statistic.br /
br /
a href=\"http://4.bp.blogspot.com/-y6i2sH8LA6k/T7fDgCqWuCI/AAAAAAAAPN0/JKGZoHmPZyw/s1600/wallace%2Bapparel%2BImports%2B2012-05.jpg\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"290\" src=\"http://4.bp.blogspot.com/-y6i2sH8LA6k/T7fDgCqWuCI/AAAAAAAAPN0/JKGZoHmPZyw/s400/wallace%2Bapparel%2BImports%2B2012-05.jpg\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
Tim writes ...br /
blockquote
Hi Mishbr /
br /
As always, I am watching imports, especially with fascination the apparel imports. In the attached graph we see that dollars and units run mostly in slope lock-step until the crash of apparel demand in 2009.br /
br /
In 2010 we see a significant \"recovery\". One thing about apparel is it does wear out, so a year like 2009 will cause pent-up demand in a following year. Price did not recover as much however.br /
br /
2011 and the 12 month historical rolling numbers ended in March of 2012 (government data lags two months) is more interesting.br /
br /
Dollar amounts continue to \"recover\" but the units measure has turned well downward again, in fact off 6% from 2010.br /
br /
Looking at the monthly data from this time last year we see a continued degradation of the units amount every month, while the dollars amount trends up.br /
br /
This is in effect apparel inflation, caused partially by raw materials. Cotton has been replaced in a significant percentage of products, stripping out demand and lowering that cost.br /
br /
China lost some market share due to labor cost competition with Vietnam. However, China still dominates with 41.2% of market share, Vietnam second at 8.5%, then Bangladesh at 6.4% and Indonesia at 5.4%.br /
br /
Thus 61.5% of all apparel imports come from only 4 countries.br /
br /
Regards,br /
br /
Tim/blockquote
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-1357391549702768191?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/e2xk39mjdikWZ-3A-1SOwZ-E8Zs/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/e2xk39mjdikWZ-3A-1SOwZ-E8Zs/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/e2xk39mjdikWZ-3A-1SOwZ-E8Zs/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/e2xk39mjdikWZ-3A-1SOwZ-E8Zs/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337443860;}i:5;a:21:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-3047603091385753956\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Sat, 19 May 2012 08:25:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-19T03:25:41.849-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:150:\"Italy Deploys 20,000 Law Enforcement Officers to Protect Individuals and Sensitive Sites; Anecdotes From Italy via Canada: Taxed Out of House and Home\";s:12:\"description#\";i:1;s:11:\"description\";s:3569:\"bItaly Deploys 20,000 Law Enforcement Officers to Protect Individuals and Sensitive Sites/bbr /
br /
The Atlanta Journal Constitution reports a href=\"http://www.ajc.com/news/nation-world/italy-deploys-20-000-1439250.html?cxtype=rss_news_82109\"Italy deploys 20,000 to protect sensitive targets/ablockquote
Italy increased security Thursday at 14,000 sites, and assigned bodyguards to protect 550 individuals after a nuclear energy company official was shot and letter bombs directed to the tax collection agency.br /
br /
Under the enhanced measures, Interior Minister Anna Maria Cancellieri deployed 20,000 law enforcement officers to protect individuals and sensitive sites. In addition, 4,200 military personnel already assigned throughout Italy will be redeployed according to new priorities.br /
br /
Authorities will also increase intelligence to \"neutralize\" the risk of subversive actions \"that can be nourished in moments of tension,\" the statement added./blockquote
bTaxed Out of House and Home/bbr /
br /
In response to a href=\"http://globaleconomicanalysis.blogspot.com/2012/05/tax-collection-violence-in-italy-mail.html\"Tax Collection Violence in Italy: Mail Bombs in Rome, Police Clashes in Naples, Molotov Cocktails in Livorno/a I received an email from Frank who lives in Canada but owns property in Italy writes ...blockquote
Hello Mishbr /
br /
Trust me, it really is that bad.br /
br /
I have a condo on the Adriatic in Italy, and lots of family still there. The local municipal property tax, called Imposta Comunale Immobili (ICI), is paid by anyone who owns property or land, whether they are a resident or not.br /
br /
Recently, property taxes have gone up fast. Property is now being reassessed at the \"real\" value instead of the \"official\" (wink) value.br /
br /
TV shows highlight the plight of elderly who have had to move out of their own homes into nursing homes because they could not pay property taxes. br /
br /
My uncle has 6 apartments which he\'s owned for many years. He and his children live in 4
and he collects rent on the other 2 to live on. He is getting hammered. br /
br /
He lived and worked in Canada most of his life but returned to Italy because his daughter married an Italian.br /
br /
Now he desperately wants to return to Canada, but it\'s impossible to sell now.br /
br /
Frank G./blockquote
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-3047603091385753956?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/qf-IaXZOAMaThmIzjASIL7IlWjw/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/qf-IaXZOAMaThmIzjASIL7IlWjw/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/qf-IaXZOAMaThmIzjASIL7IlWjw/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/qf-IaXZOAMaThmIzjASIL7IlWjw/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:119:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/f-DWsia0XcI/italy-deploys-20000-law-enforcement.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:91:\"http://globaleconomicanalysis.blogspot.com/2012/05/italy-deploys-20000-law-enforcement.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:3569:\"bItaly Deploys 20,000 Law Enforcement Officers to Protect Individuals and Sensitive Sites/bbr /
br /
The Atlanta Journal Constitution reports a href=\"http://www.ajc.com/news/nation-world/italy-deploys-20-000-1439250.html?cxtype=rss_news_82109\"Italy deploys 20,000 to protect sensitive targets/ablockquote
Italy increased security Thursday at 14,000 sites, and assigned bodyguards to protect 550 individuals after a nuclear energy company official was shot and letter bombs directed to the tax collection agency.br /
br /
Under the enhanced measures, Interior Minister Anna Maria Cancellieri deployed 20,000 law enforcement officers to protect individuals and sensitive sites. In addition, 4,200 military personnel already assigned throughout Italy will be redeployed according to new priorities.br /
br /
Authorities will also increase intelligence to \"neutralize\" the risk of subversive actions \"that can be nourished in moments of tension,\" the statement added./blockquote
bTaxed Out of House and Home/bbr /
br /
In response to a href=\"http://globaleconomicanalysis.blogspot.com/2012/05/tax-collection-violence-in-italy-mail.html\"Tax Collection Violence in Italy: Mail Bombs in Rome, Police Clashes in Naples, Molotov Cocktails in Livorno/a I received an email from Frank who lives in Canada but owns property in Italy writes ...blockquote
Hello Mishbr /
br /
Trust me, it really is that bad.br /
br /
I have a condo on the Adriatic in Italy, and lots of family still there. The local municipal property tax, called Imposta Comunale Immobili (ICI), is paid by anyone who owns property or land, whether they are a resident or not.br /
br /
Recently, property taxes have gone up fast. Property is now being reassessed at the \"real\" value instead of the \"official\" (wink) value.br /
br /
TV shows highlight the plight of elderly who have had to move out of their own homes into nursing homes because they could not pay property taxes. br /
br /
My uncle has 6 apartments which he\'s owned for many years. He and his children live in 4
and he collects rent on the other 2 to live on. He is getting hammered. br /
br /
He lived and worked in Canada most of his life but returned to Italy because his daughter married an Italian.br /
br /
Now he desperately wants to return to Canada, but it\'s impossible to sell now.br /
br /
Frank G./blockquote
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-3047603091385753956?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/qf-IaXZOAMaThmIzjASIL7IlWjw/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/qf-IaXZOAMaThmIzjASIL7IlWjw/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/qf-IaXZOAMaThmIzjASIL7IlWjw/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/qf-IaXZOAMaThmIzjASIL7IlWjw/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337415900;}i:6;a:21:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-8217459290230263940\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Fri, 18 May 2012 19:36:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-18T14:41:23.760-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:195:\"Merkel to Approach Greece with \"Growth Proposals\" while Asking for Referendum on Euro; Elections Provide Yet Another Attempt to Snatch Defeat From Jaws of Victory; New Democracy Leads Latest Poll\";s:12:\"description#\";i:1;s:11:\"description\";s:6827:\"Greek elections are set for June 17th following the impasse of the last election where no majority government formed.br /
br /
The \"Destroy Greece to Save the Euro\" clowns led by German Chancellor Angela Merkel are out in force hoping to turn the vote into a direct referendum on the Euro. The election is of course a direct referendum on the Euro, but Greek citizens are under three Fantasyland ideas.br /
br /
bThree Fantasyland Ideas /bbr /
br /
ol
liThe euro is a good thing for Greece/li
liIt is possible for Greece to stay on the euro but default on debt/li
liGreece can recover in the eurozone /li
/ol
br /
Merkel is doing her best to convince Greeks that number 2 is not possible and she is correct on that score. She is also promoting the Fantasland positions numbers 1 and 3.br /
br /
bMerkel Asks For Greece Referendum on Euro/bbr /
br /
iMarketWatch/i reports a href=\"http://www.marketwatch.com/story/greece-says-merkel-asked-for-euro-referendum-2012-05-18?link=MW_latest_news\" target=\"_blank\"Merkel Asks For Greece Referendum on Euro/a.br /
blockquote
Germany’s chancellor reportedly proposed on Friday that Greece hold a referendum on its membership in the euro currency area, increasing pressure on the nation just as Group of Eight leaders are set to discuss the region’s debt crisis this weekend.br /
br /
In a phone call with the Greek president on Friday, German leader Angela Merkel suggested that Greece could have a referendum on the euro when it holds national elections in June, according to media reports, citing a Greek government spokesman.br /
br /
Whether she actually did make the proposal is in doubt — her spokesman denied it, but the Greek official then reiterated that Merkel made such a request. /blockquote
bMerkel Yields on Growth Measures/bbr /
br /
As a matter of political expediency (or do I mean political suicide) a href=\"http://www.bloomberg.com/news/2012-05-15/merkel-s-first-hollande-meeting-yields-growth-offer-for-greece.html\" target=\"_blank\"Merkel-Hollande Meeting Yields Greece Growth Signal/abr /
blockquote
German Chancellor Angela Merkel and French President Francois Hollande said they would consider measures to spur economic growth in Greece as long as voters there committed to the austerity demanded to stay in the euro.br /
br /
Requests for measures to bolster growth will be “iconsidered/i†and the European Union may also “iapproach Greece with proposals/i,†Merkel said late yesterday at a joint press conference with Hollande during his first official visit to Berlin. “Greece can stay in the euro area,†and “Greek citizens will be voting on exactly that.†/blockquote
bIs Merkel\'s Strategy Working?/bbr /
br /
The idea that Germany is going to consider anything for Greece but still more austerity measures is yet another Fantasyland notion. Is proof of her strategy in the polls?br /
br /
The latest polls show a href=\"http://www.reuters.com/article/2012/05/17/us-greece-politics-poll-idUSBRE84G11420120517\" target=\"_blank\"pro-bailout conservatives leading/abr /
blockquote
Greece\'s conservative New Democracy party, which backs the country\'s international bailout, has retaken the lead from the anti-bailout radical leftist SYRIZA, a poll showed on Thursday, the first published since a new election was called for June 17.br /
br /
If elections were held now, New Democracy would win 26.1 percent of the vote compared with SYRIZA\'s 23.7 percent, according to the MARC/Alpha survey conducted on May 15-17.br /
br /
Based on this result, New Democracy would win 123 seats, the pollsters said. Combined with the 41 seats projected to be won by the Socialist PASOK, Greece\'s two major pro-bailout parties would command a 14-seat majority in the country\'s 300-strong parliament.br /
br /
Support for SYRIZA appears to have declined after the party refused to join a national unity government with all the other major parties, the MARC poll showed. In the previous survey by the same agency before the coalition talks collapsed, SYRIZA led with 27.7 percent, up seven points on New Democracy./blockquote
bMoney Will Flow Along With Propagandanbsp; /bbr /
br /
For those holding the common-sense position Greece needs to leave the eurozone to recover, this may be a bit disconcerting. However, There is likely to be movement in both directions on the polls and I think this is just a temporary snap-back.br /
br /
Moreover, Greece is likely to run out of money before the next elections. Then again, if the polls show the Troika-clowns have a good shot at pulling this off, the money will flow right along with the propaganda.br /
br /
To understand what the battle to \"isave Greece/i\" is really about, please consider a href=\"http://globaleconomicanalysis.blogspot.com/2012/05/euro-area-official-sector-exposures-to.html\" target=\"_blank\"Euro area official sector exposures to Greece in excess of EUR 290bn Total; EUR 84bn Germany, EUR 63bn France, EUR 55bn Italy, EUR 37bn Spain/abr /
br /
That link shows this has nothing to do with \"saving\" Greece, rather it is about saving German, French, and Italian banks (further destroying Greece in the process).br /
br /
The irony is every bailout attempt so far has done nothing but increase European banking losses. This attempt should it succeed in another bailout will do the same: increase losses. Three years ago total losses might have been on the neighborhood of 40 billion euros.br /
br /
Look at the losses now. The increased losses were caused by arrogant Troika-clown euroxcrats with asinine positions willing to repeatedly throw good money after bad.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-8217459290230263940?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/kYXwB9TyA4P38xOjH2-Y6UTkTxo/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/kYXwB9TyA4P38xOjH2-Y6UTkTxo/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/kYXwB9TyA4P38xOjH2-Y6UTkTxo/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/kYXwB9TyA4P38xOjH2-Y6UTkTxo/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:121:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/QUtmpoYQCAY/merkel-to-approach-greece-with-growth.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:93:\"http://globaleconomicanalysis.blogspot.com/2012/05/merkel-to-approach-greece-with-growth.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:6827:\"Greek elections are set for June 17th following the impasse of the last election where no majority government formed.br /
br /
The \"Destroy Greece to Save the Euro\" clowns led by German Chancellor Angela Merkel are out in force hoping to turn the vote into a direct referendum on the Euro. The election is of course a direct referendum on the Euro, but Greek citizens are under three Fantasyland ideas.br /
br /
bThree Fantasyland Ideas /bbr /
br /
ol
liThe euro is a good thing for Greece/li
liIt is possible for Greece to stay on the euro but default on debt/li
liGreece can recover in the eurozone /li
/ol
br /
Merkel is doing her best to convince Greeks that number 2 is not possible and she is correct on that score. She is also promoting the Fantasland positions numbers 1 and 3.br /
br /
bMerkel Asks For Greece Referendum on Euro/bbr /
br /
iMarketWatch/i reports a href=\"http://www.marketwatch.com/story/greece-says-merkel-asked-for-euro-referendum-2012-05-18?link=MW_latest_news\" target=\"_blank\"Merkel Asks For Greece Referendum on Euro/a.br /
blockquote
Germany’s chancellor reportedly proposed on Friday that Greece hold a referendum on its membership in the euro currency area, increasing pressure on the nation just as Group of Eight leaders are set to discuss the region’s debt crisis this weekend.br /
br /
In a phone call with the Greek president on Friday, German leader Angela Merkel suggested that Greece could have a referendum on the euro when it holds national elections in June, according to media reports, citing a Greek government spokesman.br /
br /
Whether she actually did make the proposal is in doubt — her spokesman denied it, but the Greek official then reiterated that Merkel made such a request. /blockquote
bMerkel Yields on Growth Measures/bbr /
br /
As a matter of political expediency (or do I mean political suicide) a href=\"http://www.bloomberg.com/news/2012-05-15/merkel-s-first-hollande-meeting-yields-growth-offer-for-greece.html\" target=\"_blank\"Merkel-Hollande Meeting Yields Greece Growth Signal/abr /
blockquote
German Chancellor Angela Merkel and French President Francois Hollande said they would consider measures to spur economic growth in Greece as long as voters there committed to the austerity demanded to stay in the euro.br /
br /
Requests for measures to bolster growth will be “iconsidered/i†and the European Union may also “iapproach Greece with proposals/i,†Merkel said late yesterday at a joint press conference with Hollande during his first official visit to Berlin. “Greece can stay in the euro area,†and “Greek citizens will be voting on exactly that.†/blockquote
bIs Merkel\'s Strategy Working?/bbr /
br /
The idea that Germany is going to consider anything for Greece but still more austerity measures is yet another Fantasyland notion. Is proof of her strategy in the polls?br /
br /
The latest polls show a href=\"http://www.reuters.com/article/2012/05/17/us-greece-politics-poll-idUSBRE84G11420120517\" target=\"_blank\"pro-bailout conservatives leading/abr /
blockquote
Greece\'s conservative New Democracy party, which backs the country\'s international bailout, has retaken the lead from the anti-bailout radical leftist SYRIZA, a poll showed on Thursday, the first published since a new election was called for June 17.br /
br /
If elections were held now, New Democracy would win 26.1 percent of the vote compared with SYRIZA\'s 23.7 percent, according to the MARC/Alpha survey conducted on May 15-17.br /
br /
Based on this result, New Democracy would win 123 seats, the pollsters said. Combined with the 41 seats projected to be won by the Socialist PASOK, Greece\'s two major pro-bailout parties would command a 14-seat majority in the country\'s 300-strong parliament.br /
br /
Support for SYRIZA appears to have declined after the party refused to join a national unity government with all the other major parties, the MARC poll showed. In the previous survey by the same agency before the coalition talks collapsed, SYRIZA led with 27.7 percent, up seven points on New Democracy./blockquote
bMoney Will Flow Along With Propagandanbsp; /bbr /
br /
For those holding the common-sense position Greece needs to leave the eurozone to recover, this may be a bit disconcerting. However, There is likely to be movement in both directions on the polls and I think this is just a temporary snap-back.br /
br /
Moreover, Greece is likely to run out of money before the next elections. Then again, if the polls show the Troika-clowns have a good shot at pulling this off, the money will flow right along with the propaganda.br /
br /
To understand what the battle to \"isave Greece/i\" is really about, please consider a href=\"http://globaleconomicanalysis.blogspot.com/2012/05/euro-area-official-sector-exposures-to.html\" target=\"_blank\"Euro area official sector exposures to Greece in excess of EUR 290bn Total; EUR 84bn Germany, EUR 63bn France, EUR 55bn Italy, EUR 37bn Spain/abr /
br /
That link shows this has nothing to do with \"saving\" Greece, rather it is about saving German, French, and Italian banks (further destroying Greece in the process).br /
br /
The irony is every bailout attempt so far has done nothing but increase European banking losses. This attempt should it succeed in another bailout will do the same: increase losses. Three years ago total losses might have been on the neighborhood of 40 billion euros.br /
br /
Look at the losses now. The increased losses were caused by arrogant Troika-clown euroxcrats with asinine positions willing to repeatedly throw good money after bad.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-8217459290230263940?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/kYXwB9TyA4P38xOjH2-Y6UTkTxo/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/kYXwB9TyA4P38xOjH2-Y6UTkTxo/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/kYXwB9TyA4P38xOjH2-Y6UTkTxo/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/kYXwB9TyA4P38xOjH2-Y6UTkTxo/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337369760;}i:7;a:22:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-7486296022572863555\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Fri, 18 May 2012 15:46:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-18T11:06:51.153-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:204:\"Spanish Bad-Loans Ratio at 8.37 Percent, a 17-Year High; CDS at Record High; Bankia Suffers Huge Losses Purchasing 15.5 Million Its Own Shares to Stabilize Price; Spain Hires Goldman Sachs to Value Bankia\";s:12:\"description#\";i:1;s:11:\"description\";s:8588:\"It\'s time for another roundup on Spain. Every day is time for another roundup on Spain. Today\'s report is on bad loans, and complete foolishness at Bankia buying its own shares hoping to stabilize its price.br /
br /
bSpanish Bad-Loans Ratio Hits 8.37 Percent/bbr /
br /
The iWall Street Journal/i reports a href=\"http://online.wsj.com/article/SB10001424052702303360504577411710707054788.html\" target=\"_blank\"Spanish Bad-Loans Ratio Hits 17-Year High/a
blockquote
Bad debts held by Spanish banks rose to a 17-year high in March and the cost of insuring the debt of two major Spanish banks against default hit a record Friday a day after the sector was hit by a downgrade, underscoring the continuing challenges posed by the country\'s five-year property slump.br /
br /
The central bank said that 8.37% of the loans held by banks, or €147.97 billion ($188 billion), were more than three months overdue for repayment in March, up from 8.3% in February and the highest since September 1994. The total number of non-performing loans is now almost 10 times higher than the level reported in 2007, just as Spain\'s decade-high property boom peaked.br /
br /
The rapid deterioration of the loan books was one of four reasons cited by Moody\'s Investors Service for its downgrade of the credit ratings of Banco Santander SA, Banco Bilbao Vizcaya Argentaria SA and 14 other banks in the country late Thursday.br /
br /
\"Moody\'s announcement will increase speculation that the Iberian state will be forced to ask for external support in order to effectively tackle its banking crisis,\" said interest rates strategists at Lloyds Bank WBM.br /
br /
At 0956 GMT, Spain\'s IBEX-35 blue-chip index was up 0.5%, following a negative start. Bankia\'s shares gained 19% after they fell 14% Thursday and had suffered 10 straight days of declines, while those of other banks including also bounced after deep losses earlier in the week./blockquote
bBankia Suffers Huge Losses Purchasing 15.5 Million Its Own Shares/bbr /
br /
For the \"oops\" file, courtesy of Google translate please note a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Feconomia.elpais.com%2Feconomia%2F2012%2F05%2F17%2Factualidad%2F1337241762_250903.htmlamp;act=url\" target=\"_blank\"Bankia bought 15.5 million shares to try to stop its collapse/a
blockquote
May 17, 2012br /
br /
Bankia tried unsuccessfully to halt the collapse of its stock market price in the days when the crisis broke out of the entity. The bank bought 15.55 million of shares for 33,250,000 euros between 7 and 10 May, as has been reported to the National Securities Market. The result now is that accumulates heavy losses on these securities, which subtracts capital at a time when the bank is in need of them.br /
br /
In the previous 30 days, Bankia just had bought just over 5 million shares, according to El Confidential, which was published this morning purchases of shares of the entity.br /
br /
Bankia has failed in the attempt to halt the collapse, which today continues to fall that have become over 17% to 1.37 euros per share. At these prices, only purchases made ​​during those four days, Bankia suffer losses of about 12 million euros.br /
br /
But the losses are even greater in the previously performed operations to try to sustain the price at which the entity has accumulated treasury of 86.124 million shares, 4.319% of its own capital. In total, the bank has more than 100 million in losses to the treasury share transactions. /blockquote
bBankia Share Prices/bbr /
br /
Today\'s rally looks pretty good but here is a little perspective on a href=\"http://www.digitallook.com/companyresearch/2575260/Bankia/share_prices.html\" target=\"_blank\"Bankia Share Prices/a.br /
br /
a href=\"http://2.bp.blogspot.com/-kD9xcqDvjgI/T7ZrqgwnM6I/AAAAAAAAPNY/oSX4DCE86NQ/s1600/Bankia.jpg\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"277\" src=\"http://2.bp.blogspot.com/-kD9xcqDvjgI/T7ZrqgwnM6I/AAAAAAAAPNY/oSX4DCE86NQ/s400/Bankia.jpg\" width=\"400\" //abr /
br /
bUnion Silliness/bbr /
br /
For the \"where there\'s public unions, there\'s stupidity file\" a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.elconfidencial.com%2Feconomia%2F2012%2F05%2F17%2Fsindicatos-de-bankia-instan-a-comprar-acciones-de-la-entidad-para-impedir-el-derrumbe-de-la-cotizacion--98194%2Famp;act=url\" target=\"_blank\"Unions urge Employees to buy shares in Bankia to prevent the collapse of the price/a.blockquote
Bankia unions urge their employees and clients to buy shares in the company to prevent the collapse of its stock market price and help ensure its future, according to a statement of the Boards and Professional Association (CACAM).br /
br /
Under the slogan \'I buy Bankia. Do you? Are we united? \', These professionals Bankia broadcast a statement following an email I have received, the undersigned, with whom they want to send a message of confidence in the project entity./blockquote
bBankia Bleeds Cash/bbr /
br /
Meanwhile, Bankia bleeds cash and will not respond to questions.br /
br /
iEl Economista/i reports a href=\"http://translate.google.com/translate?hl=enamp;sl=autoamp;tl=enamp;u=http%3A%2F%2Fwww.eleconomista.es%2Fempresas-finanzas%2Fnoticias%2F3972569%2F05%2F12%2FBankia-habria-perdido-1000-millones-en-depositos-en-una-semana.html\" target=\"_blank\"Bankia has lost 1 billion euros in deposits in one week/a.blockquote
Bankia customers have withdrawn deposits worth over 1,000 million euros since the government announced its intervention last week, according to data presented suggest the board meeting yesterday.br /
br /
On Wednesday, Bankia not respond to Reuters requests asking whether there were bank runs Thursday and no one has commented on the information published by the newspaper El Mundo in its paper edition. /blockquote
bGoldman Sachs Hired to Value Bankia/bbr /
br /
a target=\"_blank\" href=\"http://finance.yahoo.com/news/spain-hires-goldman-sachs-value-062558641.html?l=1\"Please consider Spain Hires Goldman Sachs to Value Bankia/ablockquoteThe Spanish government has hired Goldman Sachs to carry out an independent valuation of Bankia, the ailing bank taken over by the state last week, Spanish newspaper Expansion said on Friday.br /
br /
The U.S. bank will review Bankia\'s and its parent company BFA\'s books and determine within a month how much the state should inject to refloat the lender, which had to be rescued after its auditor, Deloitte, identified several gaps in last year\'s accounts.br /
br /
Expansion said without citing sources that Bankia\'s financial hole may reach 8 billion euros on top of the 10 billion euros it needs to set aside to cover potential losses on real estate assets, as required by two financial reforms passed by the government in February and last week./blockquoteIs this one of those deals where a consultant is hired to give give a predetermined opinion?br /
br /
We will find out soon enough because no one can possibly determine \"Bankia is a solvent entity\". In fact, the entire Spanish banking system is clearly insolvent.br /
br /
Here\'s the question of the day: Is there any reason Bankia shares will not or should not trade for pennies at some time in the near future?br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-7486296022572863555?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/uvIJSA5exfzOgb3Sz_7bLMKtVmc/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/uvIJSA5exfzOgb3Sz_7bLMKtVmc/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/uvIJSA5exfzOgb3Sz_7bLMKtVmc/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/uvIJSA5exfzOgb3Sz_7bLMKtVmc/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:122:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/er1M6DnweXs/spanish-bad-loans-ratio-at-837-percent.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:5:\"media\";a:6:{s:10:\"thumbnail#\";i:1;s:10:\"thumbnail@\";s:28:\"xmlns:media,url,height,width\";s:21:\"thumbnail@xmlns:media\";s:29:\"http://search.yahoo.com/mrss/\";s:13:\"thumbnail@url\";s:90:\"http://2.bp.blogspot.com/-kD9xcqDvjgI/T7ZrqgwnM6I/AAAAAAAAPNY/oSX4DCE86NQ/s72-c/Bankia.jpg\";s:16:\"thumbnail@height\";s:2:\"72\";s:15:\"thumbnail@width\";s:2:\"72\";}s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:94:\"http://globaleconomicanalysis.blogspot.com/2012/05/spanish-bad-loans-ratio-at-837-percent.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:8588:\"It\'s time for another roundup on Spain. Every day is time for another roundup on Spain. Today\'s report is on bad loans, and complete foolishness at Bankia buying its own shares hoping to stabilize its price.br /
br /
bSpanish Bad-Loans Ratio Hits 8.37 Percent/bbr /
br /
The iWall Street Journal/i reports a href=\"http://online.wsj.com/article/SB10001424052702303360504577411710707054788.html\" target=\"_blank\"Spanish Bad-Loans Ratio Hits 17-Year High/a
blockquote
Bad debts held by Spanish banks rose to a 17-year high in March and the cost of insuring the debt of two major Spanish banks against default hit a record Friday a day after the sector was hit by a downgrade, underscoring the continuing challenges posed by the country\'s five-year property slump.br /
br /
The central bank said that 8.37% of the loans held by banks, or €147.97 billion ($188 billion), were more than three months overdue for repayment in March, up from 8.3% in February and the highest since September 1994. The total number of non-performing loans is now almost 10 times higher than the level reported in 2007, just as Spain\'s decade-high property boom peaked.br /
br /
The rapid deterioration of the loan books was one of four reasons cited by Moody\'s Investors Service for its downgrade of the credit ratings of Banco Santander SA, Banco Bilbao Vizcaya Argentaria SA and 14 other banks in the country late Thursday.br /
br /
\"Moody\'s announcement will increase speculation that the Iberian state will be forced to ask for external support in order to effectively tackle its banking crisis,\" said interest rates strategists at Lloyds Bank WBM.br /
br /
At 0956 GMT, Spain\'s IBEX-35 blue-chip index was up 0.5%, following a negative start. Bankia\'s shares gained 19% after they fell 14% Thursday and had suffered 10 straight days of declines, while those of other banks including also bounced after deep losses earlier in the week./blockquote
bBankia Suffers Huge Losses Purchasing 15.5 Million Its Own Shares/bbr /
br /
For the \"oops\" file, courtesy of Google translate please note a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Feconomia.elpais.com%2Feconomia%2F2012%2F05%2F17%2Factualidad%2F1337241762_250903.htmlamp;act=url\" target=\"_blank\"Bankia bought 15.5 million shares to try to stop its collapse/a
blockquote
May 17, 2012br /
br /
Bankia tried unsuccessfully to halt the collapse of its stock market price in the days when the crisis broke out of the entity. The bank bought 15.55 million of shares for 33,250,000 euros between 7 and 10 May, as has been reported to the National Securities Market. The result now is that accumulates heavy losses on these securities, which subtracts capital at a time when the bank is in need of them.br /
br /
In the previous 30 days, Bankia just had bought just over 5 million shares, according to El Confidential, which was published this morning purchases of shares of the entity.br /
br /
Bankia has failed in the attempt to halt the collapse, which today continues to fall that have become over 17% to 1.37 euros per share. At these prices, only purchases made ​​during those four days, Bankia suffer losses of about 12 million euros.br /
br /
But the losses are even greater in the previously performed operations to try to sustain the price at which the entity has accumulated treasury of 86.124 million shares, 4.319% of its own capital. In total, the bank has more than 100 million in losses to the treasury share transactions. /blockquote
bBankia Share Prices/bbr /
br /
Today\'s rally looks pretty good but here is a little perspective on a href=\"http://www.digitallook.com/companyresearch/2575260/Bankia/share_prices.html\" target=\"_blank\"Bankia Share Prices/a.br /
br /
a href=\"http://2.bp.blogspot.com/-kD9xcqDvjgI/T7ZrqgwnM6I/AAAAAAAAPNY/oSX4DCE86NQ/s1600/Bankia.jpg\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"277\" src=\"http://2.bp.blogspot.com/-kD9xcqDvjgI/T7ZrqgwnM6I/AAAAAAAAPNY/oSX4DCE86NQ/s400/Bankia.jpg\" width=\"400\" //abr /
br /
bUnion Silliness/bbr /
br /
For the \"where there\'s public unions, there\'s stupidity file\" a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.elconfidencial.com%2Feconomia%2F2012%2F05%2F17%2Fsindicatos-de-bankia-instan-a-comprar-acciones-de-la-entidad-para-impedir-el-derrumbe-de-la-cotizacion--98194%2Famp;act=url\" target=\"_blank\"Unions urge Employees to buy shares in Bankia to prevent the collapse of the price/a.blockquote
Bankia unions urge their employees and clients to buy shares in the company to prevent the collapse of its stock market price and help ensure its future, according to a statement of the Boards and Professional Association (CACAM).br /
br /
Under the slogan \'I buy Bankia. Do you? Are we united? \', These professionals Bankia broadcast a statement following an email I have received, the undersigned, with whom they want to send a message of confidence in the project entity./blockquote
bBankia Bleeds Cash/bbr /
br /
Meanwhile, Bankia bleeds cash and will not respond to questions.br /
br /
iEl Economista/i reports a href=\"http://translate.google.com/translate?hl=enamp;sl=autoamp;tl=enamp;u=http%3A%2F%2Fwww.eleconomista.es%2Fempresas-finanzas%2Fnoticias%2F3972569%2F05%2F12%2FBankia-habria-perdido-1000-millones-en-depositos-en-una-semana.html\" target=\"_blank\"Bankia has lost 1 billion euros in deposits in one week/a.blockquote
Bankia customers have withdrawn deposits worth over 1,000 million euros since the government announced its intervention last week, according to data presented suggest the board meeting yesterday.br /
br /
On Wednesday, Bankia not respond to Reuters requests asking whether there were bank runs Thursday and no one has commented on the information published by the newspaper El Mundo in its paper edition. /blockquote
bGoldman Sachs Hired to Value Bankia/bbr /
br /
a target=\"_blank\" href=\"http://finance.yahoo.com/news/spain-hires-goldman-sachs-value-062558641.html?l=1\"Please consider Spain Hires Goldman Sachs to Value Bankia/ablockquoteThe Spanish government has hired Goldman Sachs to carry out an independent valuation of Bankia, the ailing bank taken over by the state last week, Spanish newspaper Expansion said on Friday.br /
br /
The U.S. bank will review Bankia\'s and its parent company BFA\'s books and determine within a month how much the state should inject to refloat the lender, which had to be rescued after its auditor, Deloitte, identified several gaps in last year\'s accounts.br /
br /
Expansion said without citing sources that Bankia\'s financial hole may reach 8 billion euros on top of the 10 billion euros it needs to set aside to cover potential losses on real estate assets, as required by two financial reforms passed by the government in February and last week./blockquoteIs this one of those deals where a consultant is hired to give give a predetermined opinion?br /
br /
We will find out soon enough because no one can possibly determine \"Bankia is a solvent entity\". In fact, the entire Spanish banking system is clearly insolvent.br /
br /
Here\'s the question of the day: Is there any reason Bankia shares will not or should not trade for pennies at some time in the near future?br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-7486296022572863555?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/uvIJSA5exfzOgb3Sz_7bLMKtVmc/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/uvIJSA5exfzOgb3Sz_7bLMKtVmc/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/uvIJSA5exfzOgb3Sz_7bLMKtVmc/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/uvIJSA5exfzOgb3Sz_7bLMKtVmc/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337355960;}i:8;a:22:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-4214162780431899562\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Fri, 18 May 2012 04:35:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-18T00:56:04.956-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:57:\"My Wife Joanne Has Passed Away; Stop and Smell the Lilacs\";s:12:\"description#\";i:1;s:11:\"description\";s:4289:\"Yesterday afternoon, my wife, Joanne went on to a better place. For those still on this planet, please remember to stop and smell the lilacs.br /
br /
a href=\"http://2.bp.blogspot.com/-45yDRubakds/T7XKqp_sN0I/AAAAAAAAPNE/EEJVjbS0hGc/s1600/Joanne2.jpg\" imageanchor=\"1\"img border=\"0\" height=\"400\" src=\"http://2.bp.blogspot.com/-45yDRubakds/T7XKqp_sN0I/AAAAAAAAPNE/EEJVjbS0hGc/s400/Joanne2.jpg\" width=\"268\" //a
br /
br /
That picture is from our honeymoon on Mackinac Island, Michigan, about 27 years ago. Lilacs were her favorite flower.br /
br /
In lieu of flowers or food, I ask the living to consider a donation in here name to support ALS research, the disease that took her life. br /
br /
I wrote about the disease and an ALS fundraiser I sponsored twice previously.br /
br /
ul
/ul
ol
liApril 2, 2012: a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/my-wife-joanne-has-als-lou-gehrigs.html\"My Wife Joanne Has ALS, Lou Gehrig\'s Disease/a/li
liMay 15, 2012: a href=\"http://globaleconomicanalysis.blogspot.com/2012/05/als-update-money-contributions-from-22.html\"ALS Update; I Still Need Your Help; Money Contributions From 22 Countries!/a/li
/ol
ul
/ul
br /
bResults as of Thursday 5-17-2012nbsp;/bbr /
br /
ul
liDonations $14,931 /li
liTickets $236,800/li
liCorporate Sponsorships $20,000 /li
/ul
br /
Les Turner gets half of ticket sales so the direct benefit to Les Turner so far is $154,331.br /
br /
bDonations From 23 Countries/bbr /
br /
Donations have come in from 23 countries now. Click the second link above to see.br /
br /
Over the years many people have asked me to put up a tip jar. I refused. I have always thought the best information is free. That philosophy has served me well. I have never asked for anything, but I am asking now.br /
br /
If information from this blog, for free, 4-5 posts a day (for 7 years!) has made you money or kept you out of trouble, then please consider purchasing a raffle ticket or making a donation.br /
br /
If times are tough, and they may very well be, then please consider a cash donation of $10 or more. Every bit helps.br /
br /
bChecks/bbr /
br /
To make a cash donation by check or money order, please send a check or money order tobr /
Lacey Woodnbsp; br /
Mish Campaignbr /
Les Turner ALS Foundationbr /
5550 W. Touhy Avenue, Suite 302
Skokie, IL 60077br /
847.679.3311 (Main)br /
Any questions, please call the above number.br /
br /
bCredit Card/bbr /
br /
You can make a donation or purchase raffle tickets by credit card on the a href=\"https://www.kintera.org/site/apps/ka/rg/ecreg.asp?c=7oJDLNPxFkJWGamp;b=8032591amp;en=ddJQJMPkHcKAKFMqEiLDKFPqGlISIRMhG5KCIPMxHhLOLYNoH7IFIMNsFkJIIHOrErE\" target=\"_blank\"raffle site/a.br /
br /
Some people did not like entering the information fields required, however, the purpose is only to ensure the foundation knows how to get in touch with raffle winners.br /
br /
People move, phone numbers change, and email addresses change. It\'s as simple as that.br /
br /
Those who do not like disclosing personal information on a form (the site is secure)
can send a check or money order for tickets or to make a donation.br /
br /
bPhilosophic Point of View/bbr /
br /
Whether you make a donation or not, please stop and smell the lilacs. Joanne did, at every opportunity.br /
br /
Goodbye Joanne we love you and miss you already.div class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-4214162780431899562?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/6QgzTlhD4KmJWSt1GVXutRl5Gow/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/6QgzTlhD4KmJWSt1GVXutRl5Gow/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/6QgzTlhD4KmJWSt1GVXutRl5Gow/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/6QgzTlhD4KmJWSt1GVXutRl5Gow/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:123:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/akcgY-Luxlo/my-wife-joanne-has-passed-away-stop-and.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:5:\"media\";a:6:{s:10:\"thumbnail#\";i:1;s:10:\"thumbnail@\";s:28:\"xmlns:media,url,height,width\";s:21:\"thumbnail@xmlns:media\";s:29:\"http://search.yahoo.com/mrss/\";s:13:\"thumbnail@url\";s:91:\"http://2.bp.blogspot.com/-45yDRubakds/T7XKqp_sN0I/AAAAAAAAPNE/EEJVjbS0hGc/s72-c/Joanne2.jpg\";s:16:\"thumbnail@height\";s:2:\"72\";s:15:\"thumbnail@width\";s:2:\"72\";}s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:95:\"http://globaleconomicanalysis.blogspot.com/2012/05/my-wife-joanne-has-passed-away-stop-and.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:4289:\"Yesterday afternoon, my wife, Joanne went on to a better place. For those still on this planet, please remember to stop and smell the lilacs.br /
br /
a href=\"http://2.bp.blogspot.com/-45yDRubakds/T7XKqp_sN0I/AAAAAAAAPNE/EEJVjbS0hGc/s1600/Joanne2.jpg\" imageanchor=\"1\"img border=\"0\" height=\"400\" src=\"http://2.bp.blogspot.com/-45yDRubakds/T7XKqp_sN0I/AAAAAAAAPNE/EEJVjbS0hGc/s400/Joanne2.jpg\" width=\"268\" //a
br /
br /
That picture is from our honeymoon on Mackinac Island, Michigan, about 27 years ago. Lilacs were her favorite flower.br /
br /
In lieu of flowers or food, I ask the living to consider a donation in here name to support ALS research, the disease that took her life. br /
br /
I wrote about the disease and an ALS fundraiser I sponsored twice previously.br /
br /
ul
/ul
ol
liApril 2, 2012: a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/my-wife-joanne-has-als-lou-gehrigs.html\"My Wife Joanne Has ALS, Lou Gehrig\'s Disease/a/li
liMay 15, 2012: a href=\"http://globaleconomicanalysis.blogspot.com/2012/05/als-update-money-contributions-from-22.html\"ALS Update; I Still Need Your Help; Money Contributions From 22 Countries!/a/li
/ol
ul
/ul
br /
bResults as of Thursday 5-17-2012nbsp;/bbr /
br /
ul
liDonations $14,931 /li
liTickets $236,800/li
liCorporate Sponsorships $20,000 /li
/ul
br /
Les Turner gets half of ticket sales so the direct benefit to Les Turner so far is $154,331.br /
br /
bDonations From 23 Countries/bbr /
br /
Donations have come in from 23 countries now. Click the second link above to see.br /
br /
Over the years many people have asked me to put up a tip jar. I refused. I have always thought the best information is free. That philosophy has served me well. I have never asked for anything, but I am asking now.br /
br /
If information from this blog, for free, 4-5 posts a day (for 7 years!) has made you money or kept you out of trouble, then please consider purchasing a raffle ticket or making a donation.br /
br /
If times are tough, and they may very well be, then please consider a cash donation of $10 or more. Every bit helps.br /
br /
bChecks/bbr /
br /
To make a cash donation by check or money order, please send a check or money order tobr /
Lacey Woodnbsp; br /
Mish Campaignbr /
Les Turner ALS Foundationbr /
5550 W. Touhy Avenue, Suite 302
Skokie, IL 60077br /
847.679.3311 (Main)br /
Any questions, please call the above number.br /
br /
bCredit Card/bbr /
br /
You can make a donation or purchase raffle tickets by credit card on the a href=\"https://www.kintera.org/site/apps/ka/rg/ecreg.asp?c=7oJDLNPxFkJWGamp;b=8032591amp;en=ddJQJMPkHcKAKFMqEiLDKFPqGlISIRMhG5KCIPMxHhLOLYNoH7IFIMNsFkJIIHOrErE\" target=\"_blank\"raffle site/a.br /
br /
Some people did not like entering the information fields required, however, the purpose is only to ensure the foundation knows how to get in touch with raffle winners.br /
br /
People move, phone numbers change, and email addresses change. It\'s as simple as that.br /
br /
Those who do not like disclosing personal information on a form (the site is secure)
can send a check or money order for tickets or to make a donation.br /
br /
bPhilosophic Point of View/bbr /
br /
Whether you make a donation or not, please stop and smell the lilacs. Joanne did, at every opportunity.br /
br /
Goodbye Joanne we love you and miss you already.div class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-4214162780431899562?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/6QgzTlhD4KmJWSt1GVXutRl5Gow/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/6QgzTlhD4KmJWSt1GVXutRl5Gow/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/6QgzTlhD4KmJWSt1GVXutRl5Gow/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/6QgzTlhD4KmJWSt1GVXutRl5Gow/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337315700;}i:9;a:21:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-3064844031622551863\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Fri, 18 May 2012 00:36:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-17T21:39:35.590-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:188:\"Spanish Bank Debt With ECB Up 15.7% in April; Surprise VAT Hike Coming Up; Moody\'s Downgrades 16 banks; Capital Flight at Bankia; Scramble for Deposits Leads to System-Wide Cannibalization\";s:12:\"description#\";i:1;s:11:\"description\";s:8774:\"Courtesy of Google translate, please consider the following bleak reports from Spain.br /
br /
bSpanish Bank Debt With ECB Up 15.7% in April/bbr /
br /
El Confidencial reports a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.elconfidencial.com%2Feconomia%2F2012%2F05%2F14%2Fla-deuda-de-la-banca-espanola-con-el-bce-aumenta-un-157-en-abril-97995%2Famp;act=url\" target=\"_blank\"The Spanish bank debt with the ECB increased by 15.7% in April/abr /
blockquote
The debt of Spanish banks with the ECB shot up to 263.535 billion euros in April, that is 15.7% compared to 227.6 billion recorded in March, a new record, according to the Bank of Spain. This amount is outstanding entities resident in Spain still have yet to return to the European Central Bank as a result of the funding the agency has been granted previously.br /
br /
The net financing granted in April by the Eurosystem to Spanish banks accounted for 68.8% of total Eurozone, which amounted to 382.712 billion euros. However, the gross amount of appeal does not collect the money that Spanish banks have borrowed from the ECB and have been redeposited in the body to receive a return of 0.25% a day.br /
br /
The increasing difficulties of Spanish institutions to borrow from the interbank appreciate finding that the credit requested by Spanish banks headed by Mario Draghi school increased sixfold compared to that recorded in April 2011 (42.227 billion)./blockquote
bSurprise Vat Hike?/bbr /
br /
Hiking taxes in the middle of a recession is horrendous policy. Yet one should never underestimate the potential stupidity of bureaucrats.br /
br /
El Economista reports a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.eleconomista.es%2Feconomia%2Fnoticias%2F3972443%2F05%2F12%2FEl-Gobieno-prepara-una-subida-por-sorpresa-de-hasta-3-puntos-en-el-IVA.htmlamp;act=url\" target=\"_blank\"The Government is preparing a surprise rise in VAT for up to three points by 2013/abr /
blockquote
Mariano Rajoy\'s government is determined to adhere strictly and without delay the requirements of Brussels to get the unequivocal support of the European Union to reform measures taken and to try to appease the markets. This is the VAT in the rest of Europe: average at 20.9%.br /
br /
So, on Monday, the minister Luis de Guindos, acceded to the wishes of Merkel and European Commission to be the European Central Bank (ECB) who audit the Spanish banks. And now, the chief of government has already committed to some partners of his confidence that the government might have to climb two or three points in the VAT, by surprise, without waiting for 2013, as planned.br /
br /
Specifically, Rajoy met last weekend privately with the president of the CEOE, Juan Rosell. A meeting that was held at the Moncloa Palace and that was unveiled yesterday at the meeting of the Board of the Spanish employers that some attendees described as \"a funeral\" to the bleak picture of the business leaders to draw on our economy.br /
br /
And the funeral was the scenario that Juan Rosell took the opportunity to ask business leaders support unreservedly to government reforms, despite the critical position CEOE has kept tax increases approved for the Income Tax and Companies.br /
br /
And it was at that funeral in which some of the attendees told that during his speech, the president of the employers said that while Rajoy is not in favor of raising the VAT, may be forced to do it, and surprise./blockquote
bMoody\'s downgrades 16 Spanish banks/bbr /
br /
Reuters reports a href=\"http://www.reuters.com/article/2012/05/17/us-moodys-spain-banks-idUSBRE84G1GC20120517\" target=\"_blank\"Moody\'s downgrades 16 Spanish banks/abr /
blockquote
Moody\'s Investor Service carried out a sweeping downgrade of 16 Spanish banks on Thursday, including Banco Santander, the euro zone\'s largest bank, citing a weak economy and the government\'s reduced ability to support troubled lenders.br /
br /
All the banks\' long-term debt ratings were downgraded by at least one notch, and some suffered three-notch cuts.br /
br /
Thursday\'s move came after Moody\'s downgraded 26 Italian banks on Monday and followed a press report about a run at troubled lender Bankia, Spain\'s fourth largest bank. The Spanish government, which took over Bankia last week, denied the report.br /
br /
Santander suffered a three-notch cut to its long-term rating to A3 from Aa3.br /
br /
Moody\'s also cut BBVA\'s long-term rating by three notches to A3 from Aa3 and put the credit on a negative outlook. BBVA is Spain\'s second largest lender.br /
br /
The government\'s borrowing costs shot higher on Thursday after data confirmed the economy was back in recession.br /
br /
Prime Minister Mariano Rajoy said Wednesday his government, which is struggling to reduce the budget deficit, could soon have trouble financing itself in the bond market unless the pressure eases.br /
br /
The government\'s strained finances are another risk for banks, since many have used cheap loans from the European Central Bank to buy three-year and five-year government bonds.br /
br /
Through March, Spanish banks held almost 150 billion euros of Spanish government bonds, up from about 76 billion at the end of November./blockquote
bCapital Flight at Bankia/bbr /
br /
Please consider a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.eleconomista.es%2Fempresas-finanzas%2Fnoticias%2F3972569%2F05%2F12%2FBankia-habria-perdido-1000-millones-en-depositos-en-una-semana.htmlamp;act=url\" target=\"_blank\"Bankia have lost 1,000 million in deposits in one week/abr /
blockquote
Bankia customers have withdrawn deposits worth over 1,000 million euros since the government announced its intervention last week, according to data presented suggest the board meeting yesterday.br /
br /
On Wednesday, Bankia not respond to Reuters requests asking whether there were bank runs Thursday and no one has commented on the information published by the newspaper El Mundo in its paper edition.br /
br /
According to this method, was at the meeting yesterday with senior management where the CEO, Francisco Verdú, brought the fact of multi withdrawal of funds: Bankia days would have lost a similar amount to 1,160 million withdrawn in the first quarter.br /
br /
The withdrawal of money from customers Bankia is due to the mismanagement of the departure of Rodrigo Rato for the entity and the subsequent nationalization./blockquote
bScramble for Deposits Leads to System-Wide Cannibalization/bbr /
blockquote
Here are the key paragraphs from the above article.br /
br /
The competition from the big banks is a point of concern to the entity. In fact Santander is showing particularly aggressive in trying to attract customers disenchanted with Bankia have decided to withdraw their savings from the entity.br /
br /
For his part, Jose Ignacio Goirigolzarri, has not made ​​any statement on these data and harangued their managers to work hard to retain customers. The new president of the organization claimed that \"Bankia is a solvent entity, which continues to function quite normally and that offers total security.\" /blockquote
Spain goes deeper in trouble every day. No one can possibly believe \"Bankia is a solvent entity\". In fact, the entire Spanish banking system is clearly insolvent.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-3064844031622551863?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/bLgcgnMDX_KR4HMFpgZ1aRLVhxE/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/bLgcgnMDX_KR4HMFpgZ1aRLVhxE/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/bLgcgnMDX_KR4HMFpgZ1aRLVhxE/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/bLgcgnMDX_KR4HMFpgZ1aRLVhxE/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:120:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/fCBA1NCTdbM/spanish-bank-debt-with-ecb-up-157-in.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:92:\"http://globaleconomicanalysis.blogspot.com/2012/05/spanish-bank-debt-with-ecb-up-157-in.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:8774:\"Courtesy of Google translate, please consider the following bleak reports from Spain.br /
br /
bSpanish Bank Debt With ECB Up 15.7% in April/bbr /
br /
El Confidencial reports a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.elconfidencial.com%2Feconomia%2F2012%2F05%2F14%2Fla-deuda-de-la-banca-espanola-con-el-bce-aumenta-un-157-en-abril-97995%2Famp;act=url\" target=\"_blank\"The Spanish bank debt with the ECB increased by 15.7% in April/abr /
blockquote
The debt of Spanish banks with the ECB shot up to 263.535 billion euros in April, that is 15.7% compared to 227.6 billion recorded in March, a new record, according to the Bank of Spain. This amount is outstanding entities resident in Spain still have yet to return to the European Central Bank as a result of the funding the agency has been granted previously.br /
br /
The net financing granted in April by the Eurosystem to Spanish banks accounted for 68.8% of total Eurozone, which amounted to 382.712 billion euros. However, the gross amount of appeal does not collect the money that Spanish banks have borrowed from the ECB and have been redeposited in the body to receive a return of 0.25% a day.br /
br /
The increasing difficulties of Spanish institutions to borrow from the interbank appreciate finding that the credit requested by Spanish banks headed by Mario Draghi school increased sixfold compared to that recorded in April 2011 (42.227 billion)./blockquote
bSurprise Vat Hike?/bbr /
br /
Hiking taxes in the middle of a recession is horrendous policy. Yet one should never underestimate the potential stupidity of bureaucrats.br /
br /
El Economista reports a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.eleconomista.es%2Feconomia%2Fnoticias%2F3972443%2F05%2F12%2FEl-Gobieno-prepara-una-subida-por-sorpresa-de-hasta-3-puntos-en-el-IVA.htmlamp;act=url\" target=\"_blank\"The Government is preparing a surprise rise in VAT for up to three points by 2013/abr /
blockquote
Mariano Rajoy\'s government is determined to adhere strictly and without delay the requirements of Brussels to get the unequivocal support of the European Union to reform measures taken and to try to appease the markets. This is the VAT in the rest of Europe: average at 20.9%.br /
br /
So, on Monday, the minister Luis de Guindos, acceded to the wishes of Merkel and European Commission to be the European Central Bank (ECB) who audit the Spanish banks. And now, the chief of government has already committed to some partners of his confidence that the government might have to climb two or three points in the VAT, by surprise, without waiting for 2013, as planned.br /
br /
Specifically, Rajoy met last weekend privately with the president of the CEOE, Juan Rosell. A meeting that was held at the Moncloa Palace and that was unveiled yesterday at the meeting of the Board of the Spanish employers that some attendees described as \"a funeral\" to the bleak picture of the business leaders to draw on our economy.br /
br /
And the funeral was the scenario that Juan Rosell took the opportunity to ask business leaders support unreservedly to government reforms, despite the critical position CEOE has kept tax increases approved for the Income Tax and Companies.br /
br /
And it was at that funeral in which some of the attendees told that during his speech, the president of the employers said that while Rajoy is not in favor of raising the VAT, may be forced to do it, and surprise./blockquote
bMoody\'s downgrades 16 Spanish banks/bbr /
br /
Reuters reports a href=\"http://www.reuters.com/article/2012/05/17/us-moodys-spain-banks-idUSBRE84G1GC20120517\" target=\"_blank\"Moody\'s downgrades 16 Spanish banks/abr /
blockquote
Moody\'s Investor Service carried out a sweeping downgrade of 16 Spanish banks on Thursday, including Banco Santander, the euro zone\'s largest bank, citing a weak economy and the government\'s reduced ability to support troubled lenders.br /
br /
All the banks\' long-term debt ratings were downgraded by at least one notch, and some suffered three-notch cuts.br /
br /
Thursday\'s move came after Moody\'s downgraded 26 Italian banks on Monday and followed a press report about a run at troubled lender Bankia, Spain\'s fourth largest bank. The Spanish government, which took over Bankia last week, denied the report.br /
br /
Santander suffered a three-notch cut to its long-term rating to A3 from Aa3.br /
br /
Moody\'s also cut BBVA\'s long-term rating by three notches to A3 from Aa3 and put the credit on a negative outlook. BBVA is Spain\'s second largest lender.br /
br /
The government\'s borrowing costs shot higher on Thursday after data confirmed the economy was back in recession.br /
br /
Prime Minister Mariano Rajoy said Wednesday his government, which is struggling to reduce the budget deficit, could soon have trouble financing itself in the bond market unless the pressure eases.br /
br /
The government\'s strained finances are another risk for banks, since many have used cheap loans from the European Central Bank to buy three-year and five-year government bonds.br /
br /
Through March, Spanish banks held almost 150 billion euros of Spanish government bonds, up from about 76 billion at the end of November./blockquote
bCapital Flight at Bankia/bbr /
br /
Please consider a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.eleconomista.es%2Fempresas-finanzas%2Fnoticias%2F3972569%2F05%2F12%2FBankia-habria-perdido-1000-millones-en-depositos-en-una-semana.htmlamp;act=url\" target=\"_blank\"Bankia have lost 1,000 million in deposits in one week/abr /
blockquote
Bankia customers have withdrawn deposits worth over 1,000 million euros since the government announced its intervention last week, according to data presented suggest the board meeting yesterday.br /
br /
On Wednesday, Bankia not respond to Reuters requests asking whether there were bank runs Thursday and no one has commented on the information published by the newspaper El Mundo in its paper edition.br /
br /
According to this method, was at the meeting yesterday with senior management where the CEO, Francisco Verdú, brought the fact of multi withdrawal of funds: Bankia days would have lost a similar amount to 1,160 million withdrawn in the first quarter.br /
br /
The withdrawal of money from customers Bankia is due to the mismanagement of the departure of Rodrigo Rato for the entity and the subsequent nationalization./blockquote
bScramble for Deposits Leads to System-Wide Cannibalization/bbr /
blockquote
Here are the key paragraphs from the above article.br /
br /
The competition from the big banks is a point of concern to the entity. In fact Santander is showing particularly aggressive in trying to attract customers disenchanted with Bankia have decided to withdraw their savings from the entity.br /
br /
For his part, Jose Ignacio Goirigolzarri, has not made ​​any statement on these data and harangued their managers to work hard to retain customers. The new president of the organization claimed that \"Bankia is a solvent entity, which continues to function quite normally and that offers total security.\" /blockquote
Spain goes deeper in trouble every day. No one can possibly believe \"Bankia is a solvent entity\". In fact, the entire Spanish banking system is clearly insolvent.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-3064844031622551863?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/bLgcgnMDX_KR4HMFpgZ1aRLVhxE/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/bLgcgnMDX_KR4HMFpgZ1aRLVhxE/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/bLgcgnMDX_KR4HMFpgZ1aRLVhxE/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/bLgcgnMDX_KR4HMFpgZ1aRLVhxE/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337301360;}i:10;a:22:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-8334563775236078021\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Thu, 17 May 2012 20:20:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-17T18:22:50.706-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:111:\"German Finance Minister Wolfgang Schäuble Tosses Hat Into Ring Seeking to Become \"Grand Keiser for All Europe\"\";s:12:\"description#\";i:1;s:11:\"description\";s:3694:\"In the truth is stranger than fiction category, German Finance Minister Wolfgang Schäuble is calling for a political union \"now\" with a directly elected EU president (and of course he is the unstated logical candidate).br /
br /
Translation: Schäuble is running for \"Grand Keiser of All Europe\".br /
br /
Please consider a href=\"http://www.ft.com/intl/cms/s/0/b6a69d9c-a021-11e1-94ba-00144feabdc0.html#axzz1v9uQJFWB\" target=\"_blank\"Schäuble calls for closer EU integration/abr /
blockquote
Wolfgang Schäuble, Germany’s finance minister, called on Thursday for the EU to move decisively towards a political union in the face of the eurozone crisis, with a directly elected president in Brussels.br /
br /
In a passionately pro-European speech delivered in Aachen, where he was awarded the annual Charlemagne prize, Mr Schäuble said the economic and financial crisis made it clear that closer European integration was needed.br /
br /
“We must create a political union now,†he said. But he said that would not mean the creation of a European superstate, or a “United States of Europeâ€.br /
br /
A debate was needed on precisely what responsibilities should be transferred to European level, on the principle that whatever tasks could best be done locally, regionally or nationally should not be changed. br /
br /
One answer would be to give a face to European political union with a directly elected EU president in Brussels.br /
br /
Mr Schäuble, who is regarded as the most pro-European member of the German government, said the EU urgently needed to improve its negotiating capacity on the world stage, with a more effective common foreign policy, and international treaties signed by all member states together.br /
br /
“We must have the ambition to do more than simply protect the status quo,†he said./blockquote
bWolfgang Schäuble (centre) receives the Charlemagne prize on Thursday/bbr /
br /
a href=\"http://3.bp.blogspot.com/-BOHX-ce0PS4/T7Vcy_zADqI/AAAAAAAAPMc/RHYEan9UwOE/s1600/Grand%2BKeiser.jpg\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"226\" src=\"http://3.bp.blogspot.com/-BOHX-ce0PS4/T7Vcy_zADqI/AAAAAAAAPMc/RHYEan9UwOE/s400/Grand%2BKeiser.jpg\" width=\"400\" //abr /
br /
Today the Charlemagne prize, tomorrow the crown of the \"Grand Keisership\"br /
br /
bAddendum:/bbr /
I am aware of the correct spelling of Kaiser. Keiser is a joke spelling that has a personal meaning but also seems appropriate for the job.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-8334563775236078021?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/BXSvdLJCwxPC8nBN6EGlLsVXXIQ/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/BXSvdLJCwxPC8nBN6EGlLsVXXIQ/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/BXSvdLJCwxPC8nBN6EGlLsVXXIQ/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/BXSvdLJCwxPC8nBN6EGlLsVXXIQ/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:116:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/tPYO1EZRBZM/german-finance-minister-wolfgang.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:5:\"media\";a:6:{s:10:\"thumbnail#\";i:1;s:10:\"thumbnail@\";s:28:\"xmlns:media,url,height,width\";s:21:\"thumbnail@xmlns:media\";s:29:\"http://search.yahoo.com/mrss/\";s:13:\"thumbnail@url\";s:98:\"http://3.bp.blogspot.com/-BOHX-ce0PS4/T7Vcy_zADqI/AAAAAAAAPMc/RHYEan9UwOE/s72-c/Grand%2BKeiser.jpg\";s:16:\"thumbnail@height\";s:2:\"72\";s:15:\"thumbnail@width\";s:2:\"72\";}s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:88:\"http://globaleconomicanalysis.blogspot.com/2012/05/german-finance-minister-wolfgang.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:3694:\"In the truth is stranger than fiction category, German Finance Minister Wolfgang Schäuble is calling for a political union \"now\" with a directly elected EU president (and of course he is the unstated logical candidate).br /
br /
Translation: Schäuble is running for \"Grand Keiser of All Europe\".br /
br /
Please consider a href=\"http://www.ft.com/intl/cms/s/0/b6a69d9c-a021-11e1-94ba-00144feabdc0.html#axzz1v9uQJFWB\" target=\"_blank\"Schäuble calls for closer EU integration/abr /
blockquote
Wolfgang Schäuble, Germany’s finance minister, called on Thursday for the EU to move decisively towards a political union in the face of the eurozone crisis, with a directly elected president in Brussels.br /
br /
In a passionately pro-European speech delivered in Aachen, where he was awarded the annual Charlemagne prize, Mr Schäuble said the economic and financial crisis made it clear that closer European integration was needed.br /
br /
“We must create a political union now,†he said. But he said that would not mean the creation of a European superstate, or a “United States of Europeâ€.br /
br /
A debate was needed on precisely what responsibilities should be transferred to European level, on the principle that whatever tasks could best be done locally, regionally or nationally should not be changed. br /
br /
One answer would be to give a face to European political union with a directly elected EU president in Brussels.br /
br /
Mr Schäuble, who is regarded as the most pro-European member of the German government, said the EU urgently needed to improve its negotiating capacity on the world stage, with a more effective common foreign policy, and international treaties signed by all member states together.br /
br /
“We must have the ambition to do more than simply protect the status quo,†he said./blockquote
bWolfgang Schäuble (centre) receives the Charlemagne prize on Thursday/bbr /
br /
a href=\"http://3.bp.blogspot.com/-BOHX-ce0PS4/T7Vcy_zADqI/AAAAAAAAPMc/RHYEan9UwOE/s1600/Grand%2BKeiser.jpg\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"226\" src=\"http://3.bp.blogspot.com/-BOHX-ce0PS4/T7Vcy_zADqI/AAAAAAAAPMc/RHYEan9UwOE/s400/Grand%2BKeiser.jpg\" width=\"400\" //abr /
br /
Today the Charlemagne prize, tomorrow the crown of the \"Grand Keisership\"br /
br /
bAddendum:/bbr /
I am aware of the correct spelling of Kaiser. Keiser is a joke spelling that has a personal meaning but also seems appropriate for the job.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-8334563775236078021?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/BXSvdLJCwxPC8nBN6EGlLsVXXIQ/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/BXSvdLJCwxPC8nBN6EGlLsVXXIQ/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/BXSvdLJCwxPC8nBN6EGlLsVXXIQ/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/BXSvdLJCwxPC8nBN6EGlLsVXXIQ/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337286000;}i:11;a:22:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-8232778054158946058\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Thu, 17 May 2012 16:08:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-17T12:36:37.777-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:142:\"Euro area official sector exposures to Greece in excess of EUR 290bn Total; EUR 84bn Germany, EUR 63bn France, EUR 55bn Italy, EUR 37bn Spain\";s:12:\"description#\";i:1;s:11:\"description\";s:5260:\"Via email I received an interesting set of facts from Barclays regarding banking exposures to Greece.
Greece: Euro area official sector exposures in excess of EUR290bnbr /
blockquote
bEuro area official sector exposure/bbr /
br /
According to the French Finance Minister, F. Baroin, Greece\'s exit from the euro area \"would cost France EUR50bn net, in addition to the securities held by banks and insurers in their portfolios.\" In the German press, it is reported that a Greek exit would cost approximately EUR80bn (EUR16bn from bilateral KfW loans, EUR20bn from the EFSF, EUR12bn from the SMP and EUR30bn from Target 2, based on December 2012 data, source: FAZ).br /
br /
Here, we estimate the euro area\'s official sector exposure to Greece (bilateral loans, EFSF guarantees and Eurosystem) and show that the cost estimations mentioned in the press match the exposure if you consider a 20% recovery rate on Greek holdings. 20% is rather low, but not unrealistic given the outcome of the PSI and devaluation of the new Greek currency in the event of an exit. However, because of the accounting treatment of the different exposures and the presence of some financial buffers within the Eurosystem, the one-off, year-end shock on public accounts will be much smaller, probably around EUR100bn (1% of GDP).br /
br /
bEuro area exposure via bilateral loans and EFSF guarantees:/bbr /
br /
As part of the first Greek bailout package (May 2010), EUR53bn has been disbursed by member states out of the EUR80bn committed over a three-year period. These disbursements are in the form of bilateral loans between Greece and the other member states. In February 2012, a second bailout package was signed, but this time funds would be transferred to Greece by the EFSF and the guarantees passed on to member states according to (adjusted) ECB capital key allocation. This second package has taken over the unused funds from the first package and no further bilateral loans have been made since then. To date, the EFSF has issued EUR73bn out of the EUR145bn committed by member states. Altogether, the euro area states currently have a total exposure of EUR126bn, representing 1.3% of GDP.br /
br /
bEuro area exposure via the Eurosystem\'s refinancing operations and interventions: /bbr /
br /
In a Greek exit scenario, the Eurosystem faces losses stemming from either direct holdings of Greek bonds in the SMP portfolio1 or from Target 2 claims on the Greek central bank. Based on anecdotal evidence and central banks\' balance sheet movements, we estimate that the Greek SMP exposure is approximately EUR35bn and that Target 2 claims on the Greek central bank are around EUR130bn.br /
br /
bIndirect exposure via the IMF: /bbr /
br /
Even though the IMF prides itself on never having made any losses on a programme, a Greek exit would certainly challenge this record. Potential losses would be redistributed to IMF members according to their quota. With 20% of the quota (link) the euro area would be exposed to a further EUR4.4bn. br /
br /
Altogether, we estimate that the total official sector exposure to Greece is somewhere in excess of EUR290bn (see table below), representing 3.1% of (nominal) GDP. Because ECB capital keys do not exactly match GDP weights, the exposure in GDP terms varies from one country to the other, between 1.8% (Luxemburg, excluding programme countries) up to 4.5% (Malta, Estonia, see table and chart below).br /
br /
bTotal Exposures to Greece/bbr /
br /
a target=\"_blank\" href=\"http://4.bp.blogspot.com/-Hlulb4kjVqM/T7UffRYfuDI/AAAAAAAAPMI/vsnX0UO1boA/s1600/exposures%2Bto%2BGreece.png\" imageanchor=\"1\"img border=\"0\" height=\"318\" src=\"http://4.bp.blogspot.com/-Hlulb4kjVqM/T7UffRYfuDI/AAAAAAAAPMI/vsnX0UO1boA/s400/exposures%2Bto%2BGreece.png\" width=\"400\" //abr /
br /
span style=\"color: #660000;\"click on chart for sharper image/span/blockquote
Looking for a reason for all the pressure on Greece to stay in the Eurozone? There it is.
Pray tell where is Spain going to come up with 37 billion euros?br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-8232778054158946058?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/RZi-2akjRhKnla0ACIyIRlycQcM/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/RZi-2akjRhKnla0ACIyIRlycQcM/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/RZi-2akjRhKnla0ACIyIRlycQcM/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/RZi-2akjRhKnla0ACIyIRlycQcM/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:122:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/uvwnYCJMFuo/euro-area-official-sector-exposures-to.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:5:\"media\";a:6:{s:10:\"thumbnail#\";i:1;s:10:\"thumbnail@\";s:28:\"xmlns:media,url,height,width\";s:21:\"thumbnail@xmlns:media\";s:29:\"http://search.yahoo.com/mrss/\";s:13:\"thumbnail@url\";s:107:\"http://4.bp.blogspot.com/-Hlulb4kjVqM/T7UffRYfuDI/AAAAAAAAPMI/vsnX0UO1boA/s72-c/exposures%2Bto%2BGreece.png\";s:16:\"thumbnail@height\";s:2:\"72\";s:15:\"thumbnail@width\";s:2:\"72\";}s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:94:\"http://globaleconomicanalysis.blogspot.com/2012/05/euro-area-official-sector-exposures-to.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:5260:\"Via email I received an interesting set of facts from Barclays regarding banking exposures to Greece.
Greece: Euro area official sector exposures in excess of EUR290bnbr /
blockquote
bEuro area official sector exposure/bbr /
br /
According to the French Finance Minister, F. Baroin, Greece\'s exit from the euro area \"would cost France EUR50bn net, in addition to the securities held by banks and insurers in their portfolios.\" In the German press, it is reported that a Greek exit would cost approximately EUR80bn (EUR16bn from bilateral KfW loans, EUR20bn from the EFSF, EUR12bn from the SMP and EUR30bn from Target 2, based on December 2012 data, source: FAZ).br /
br /
Here, we estimate the euro area\'s official sector exposure to Greece (bilateral loans, EFSF guarantees and Eurosystem) and show that the cost estimations mentioned in the press match the exposure if you consider a 20% recovery rate on Greek holdings. 20% is rather low, but not unrealistic given the outcome of the PSI and devaluation of the new Greek currency in the event of an exit. However, because of the accounting treatment of the different exposures and the presence of some financial buffers within the Eurosystem, the one-off, year-end shock on public accounts will be much smaller, probably around EUR100bn (1% of GDP).br /
br /
bEuro area exposure via bilateral loans and EFSF guarantees:/bbr /
br /
As part of the first Greek bailout package (May 2010), EUR53bn has been disbursed by member states out of the EUR80bn committed over a three-year period. These disbursements are in the form of bilateral loans between Greece and the other member states. In February 2012, a second bailout package was signed, but this time funds would be transferred to Greece by the EFSF and the guarantees passed on to member states according to (adjusted) ECB capital key allocation. This second package has taken over the unused funds from the first package and no further bilateral loans have been made since then. To date, the EFSF has issued EUR73bn out of the EUR145bn committed by member states. Altogether, the euro area states currently have a total exposure of EUR126bn, representing 1.3% of GDP.br /
br /
bEuro area exposure via the Eurosystem\'s refinancing operations and interventions: /bbr /
br /
In a Greek exit scenario, the Eurosystem faces losses stemming from either direct holdings of Greek bonds in the SMP portfolio1 or from Target 2 claims on the Greek central bank. Based on anecdotal evidence and central banks\' balance sheet movements, we estimate that the Greek SMP exposure is approximately EUR35bn and that Target 2 claims on the Greek central bank are around EUR130bn.br /
br /
bIndirect exposure via the IMF: /bbr /
br /
Even though the IMF prides itself on never having made any losses on a programme, a Greek exit would certainly challenge this record. Potential losses would be redistributed to IMF members according to their quota. With 20% of the quota (link) the euro area would be exposed to a further EUR4.4bn. br /
br /
Altogether, we estimate that the total official sector exposure to Greece is somewhere in excess of EUR290bn (see table below), representing 3.1% of (nominal) GDP. Because ECB capital keys do not exactly match GDP weights, the exposure in GDP terms varies from one country to the other, between 1.8% (Luxemburg, excluding programme countries) up to 4.5% (Malta, Estonia, see table and chart below).br /
br /
bTotal Exposures to Greece/bbr /
br /
a target=\"_blank\" href=\"http://4.bp.blogspot.com/-Hlulb4kjVqM/T7UffRYfuDI/AAAAAAAAPMI/vsnX0UO1boA/s1600/exposures%2Bto%2BGreece.png\" imageanchor=\"1\"img border=\"0\" height=\"318\" src=\"http://4.bp.blogspot.com/-Hlulb4kjVqM/T7UffRYfuDI/AAAAAAAAPMI/vsnX0UO1boA/s400/exposures%2Bto%2BGreece.png\" width=\"400\" //abr /
br /
span style=\"color: #660000;\"click on chart for sharper image/span/blockquote
Looking for a reason for all the pressure on Greece to stay in the Eurozone? There it is.
Pray tell where is Spain going to come up with 37 billion euros?br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-8232778054158946058?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/RZi-2akjRhKnla0ACIyIRlycQcM/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/RZi-2akjRhKnla0ACIyIRlycQcM/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/RZi-2akjRhKnla0ACIyIRlycQcM/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/RZi-2akjRhKnla0ACIyIRlycQcM/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337270880;}i:12;a:21:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-2579529322818039916\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Thu, 17 May 2012 08:39:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-17T12:36:25.849-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:83:\"Brain Drain: Businesses and Brightest Minds Flee Italy; Credit Crunch Italian Style\";s:12:\"description#\";i:1;s:11:\"description\";s:6457:\"bBrain Drain/bbr /
br /
Courtesy of Google Translate, this time from Italy, please consider a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.ilsole24ore.com%2Fart%2Fimpresa-e-territori%2F2012-05-17%2Fnordest-estero-fuga-aziende-064431.shtml%3Fuuid%3DAbNZvjdF%26fromSearchamp;act=url\" target=\"_blank\"From the North-East and abroad, fleeing already 720 companies/a br /
blockquote
Farewell, ungrateful Italy. In addition to brain drain, we\'ll get used to the migration of entrepreneurs. The news coming from the North-East lab are not at all encouraging.br /
br /
Until 2010 no employer has had the courage to leave Italian soil. A sort of waiting anxiety that charge went through the last part of 2008 and the two following years.br /
br /
Explains Daniele Marini, a sociologist at the University of Padua and the Director of the North East: \"Entrepreneurs have felt a great loneliness. And 720 of them already internationalized and holding sizes above the threshold of 10 employees, in 2011 the companies have decided to move abroad.br /
br /
It remains to be seen how many entrepreneurs make the same choice in 2012.br /
br /
Marini argues that choice in the book \"Innovator of the Border\", just published by Marsilio, \"In the face of an institutional environment essentially static, ie where no desired reforms take shape, the government is not modernization, the level of taxation remains unchanged, the preconditions favorable to business life are reduced to such an extent as to suggest some to place in other countries where the fiscal and administrative environment allows them to remain competitive.\"br /
br /
It is as if suddenly the toy was broken, cracks in the same constituent elements Venetian economy: the capital first of all, based on the triad family, capital, labor. Marini explains: \"The crisis has changed the DNA of the North-East. A society that puts its identity in the work today is to consider it as a hassle. The families, however thrifty and highly oriented economy, fear of not having resources available to address such a long period of recession.\"br /
br /
The summation of all these elements outline the framework that has led entrepreneurs \"secessionists\" to set sail. /blockquote
bCredit Crunch Italian Style/bbr /
br /
Also courtesy of Google Translate, please consider a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.ilsole24ore.com%2Fart%2Fimpresa-e-territori%2F2012-05-09%2Fcredit-crunch-chiedete-224528.shtml%3Fuuid%3DAbl0kKaF%26fromSearchamp;act=url\" target=\"_blank\"The credit crunch? Ask the EBA/a
br /
blockquote
The solution to the crisis is growing. Virtually all agree on this. Even the Germans. The problem is that funding needed to grow. Especially businesses. But the credit supply to companies in Italy continues to be weak.br /
br /
\"They closed the taps, the banks have stopped doing,\" complained some time ago with emphasis Fancelli Mauro, president of the National Confederation of Craft Small and Medium Business in Florence.br /
br /
The same bankers recognize the problem. \"Not only have we reduced the new credits. But we\'re doing it furiously, \"admits a senior executive at one of the five largest Italian banking groups.br /
br /
The data reported by Mauro Fancelli for your region are dramatic: \"In the first quarter of 2012 the bank has paid to Tuscan businesses for 33.5% less than the same period of 2011. The Monte dei Paschi di Siena, a leading institute in the region, has even been a decline of 70 percent.\" br /
br /
\"The worst of the credit crunch we have yet to see it,\" warns a second top manager at another establishment of the five largest in Italy.br /
br /
With this investigation, Il Sole 24 Ore has wanted to find the reason for this phenomenon often referred to with two little words that English, along with spreads, are now common even in the chat at the bar: credit crunch - or credit crunch./blockquote
bAnecdotes From Italy/bbr /
br /
My friend Francesco writes ...br /
blockquote
Hello Mishbr /
br /
The banks in distress list gets longer.br /
br /
Two banks on chapter 11 by Bank of Italy in a few days. Last Saturday it was the turn to the Bank Credit Cooperative Monastier and Sile suffer to be placed under protection by the Financial Regulator. Last Friday was the turn instead of Tercas bank, savings bank in the province of Teramo in the meshes of the extraordinary finish. br /
br /
A customer of mine have been required to close his position with that bank, he will never be able to repay its loans to 1.5 million eur in 4 months.br /
br /
I expect a very difficult summer and in September, many businesses do not reopen. German firms will detect the best companies in the north east, at a very cheap cost, the other will close in a year.br /
br /
In Italy we have two realities, Germany and Greece, in the same borders. The North, particularly the North East, has a GDP per capita equal to or higher than Germany, the South is in a worse condition than Greece. Obviously you cannot find the solution without reexamining borders./blockquote
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-2579529322818039916?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/3Ud3fYzorAmqyuVkj_G96XuFp64/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/3Ud3fYzorAmqyuVkj_G96XuFp64/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/3Ud3fYzorAmqyuVkj_G96XuFp64/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/3Ud3fYzorAmqyuVkj_G96XuFp64/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:120:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/AUJuyk9rOs8/brian-drain-businesses-and-brightest.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:92:\"http://globaleconomicanalysis.blogspot.com/2012/05/brian-drain-businesses-and-brightest.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:6457:\"bBrain Drain/bbr /
br /
Courtesy of Google Translate, this time from Italy, please consider a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.ilsole24ore.com%2Fart%2Fimpresa-e-territori%2F2012-05-17%2Fnordest-estero-fuga-aziende-064431.shtml%3Fuuid%3DAbNZvjdF%26fromSearchamp;act=url\" target=\"_blank\"From the North-East and abroad, fleeing already 720 companies/a br /
blockquote
Farewell, ungrateful Italy. In addition to brain drain, we\'ll get used to the migration of entrepreneurs. The news coming from the North-East lab are not at all encouraging.br /
br /
Until 2010 no employer has had the courage to leave Italian soil. A sort of waiting anxiety that charge went through the last part of 2008 and the two following years.br /
br /
Explains Daniele Marini, a sociologist at the University of Padua and the Director of the North East: \"Entrepreneurs have felt a great loneliness. And 720 of them already internationalized and holding sizes above the threshold of 10 employees, in 2011 the companies have decided to move abroad.br /
br /
It remains to be seen how many entrepreneurs make the same choice in 2012.br /
br /
Marini argues that choice in the book \"Innovator of the Border\", just published by Marsilio, \"In the face of an institutional environment essentially static, ie where no desired reforms take shape, the government is not modernization, the level of taxation remains unchanged, the preconditions favorable to business life are reduced to such an extent as to suggest some to place in other countries where the fiscal and administrative environment allows them to remain competitive.\"br /
br /
It is as if suddenly the toy was broken, cracks in the same constituent elements Venetian economy: the capital first of all, based on the triad family, capital, labor. Marini explains: \"The crisis has changed the DNA of the North-East. A society that puts its identity in the work today is to consider it as a hassle. The families, however thrifty and highly oriented economy, fear of not having resources available to address such a long period of recession.\"br /
br /
The summation of all these elements outline the framework that has led entrepreneurs \"secessionists\" to set sail. /blockquote
bCredit Crunch Italian Style/bbr /
br /
Also courtesy of Google Translate, please consider a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.ilsole24ore.com%2Fart%2Fimpresa-e-territori%2F2012-05-09%2Fcredit-crunch-chiedete-224528.shtml%3Fuuid%3DAbl0kKaF%26fromSearchamp;act=url\" target=\"_blank\"The credit crunch? Ask the EBA/a
br /
blockquote
The solution to the crisis is growing. Virtually all agree on this. Even the Germans. The problem is that funding needed to grow. Especially businesses. But the credit supply to companies in Italy continues to be weak.br /
br /
\"They closed the taps, the banks have stopped doing,\" complained some time ago with emphasis Fancelli Mauro, president of the National Confederation of Craft Small and Medium Business in Florence.br /
br /
The same bankers recognize the problem. \"Not only have we reduced the new credits. But we\'re doing it furiously, \"admits a senior executive at one of the five largest Italian banking groups.br /
br /
The data reported by Mauro Fancelli for your region are dramatic: \"In the first quarter of 2012 the bank has paid to Tuscan businesses for 33.5% less than the same period of 2011. The Monte dei Paschi di Siena, a leading institute in the region, has even been a decline of 70 percent.\" br /
br /
\"The worst of the credit crunch we have yet to see it,\" warns a second top manager at another establishment of the five largest in Italy.br /
br /
With this investigation, Il Sole 24 Ore has wanted to find the reason for this phenomenon often referred to with two little words that English, along with spreads, are now common even in the chat at the bar: credit crunch - or credit crunch./blockquote
bAnecdotes From Italy/bbr /
br /
My friend Francesco writes ...br /
blockquote
Hello Mishbr /
br /
The banks in distress list gets longer.br /
br /
Two banks on chapter 11 by Bank of Italy in a few days. Last Saturday it was the turn to the Bank Credit Cooperative Monastier and Sile suffer to be placed under protection by the Financial Regulator. Last Friday was the turn instead of Tercas bank, savings bank in the province of Teramo in the meshes of the extraordinary finish. br /
br /
A customer of mine have been required to close his position with that bank, he will never be able to repay its loans to 1.5 million eur in 4 months.br /
br /
I expect a very difficult summer and in September, many businesses do not reopen. German firms will detect the best companies in the north east, at a very cheap cost, the other will close in a year.br /
br /
In Italy we have two realities, Germany and Greece, in the same borders. The North, particularly the North East, has a GDP per capita equal to or higher than Germany, the South is in a worse condition than Greece. Obviously you cannot find the solution without reexamining borders./blockquote
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-2579529322818039916?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/3Ud3fYzorAmqyuVkj_G96XuFp64/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/3Ud3fYzorAmqyuVkj_G96XuFp64/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/3Ud3fYzorAmqyuVkj_G96XuFp64/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/3Ud3fYzorAmqyuVkj_G96XuFp64/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337243940;}i:13;a:21:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-5198269143082669009\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Wed, 16 May 2012 22:39:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-16T17:39:24.069-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:129:\"Real Estate Crash in China Underway: Foreign Funding Down 80%, Land Sales Down 57%, Starts Down 27%; Expect Chinese GDP to Plunge\";s:12:\"description#\";i:1;s:11:\"description\";s:6175:\"Inquiring minds are reading an excellent report a target=\"_blank\" href=\"http://www.economonitor.com/blog/2012/05/china-real-estate-unravels/\"China Real Estate Unravels /aby Patrick Chovanec, a professor at Tsinghua University\'s School of Economics and Management in Beijing, China.br /
br /
The report confirms many of the things I said would happen in regards to the Chinese real estate bubble and GDP.br /
br /
Here are a few items of note.br /
br /
Developers, burdened by 70% leverage ratios and loans threatening to come due, rushed to complete projects already in their pipeline, to put those units onto the market and raise cash.br /
br /
That rush to complete inflated real estate investments, allegedly up 23.5% in the first quarter. Other statistics from the report tell the real story.br /
br /
ul
liYear-on-year sales in Q1, for all real estate, was down 14.6%./li
liResidential property sales were down 17.5%/li
liOffice sales were down -10.2%nbsp;/li
li Sales in January-February were a disaster, falling 20.9% overall,
compared to the first two months of 2011, -24.7% for residential./li
liTotal amount of floor space “for sale†was up 35.5%, compared to the
same date last year/li
liFloor space of residential units “for
sale†grew 47.4%. /li
li At the end of 2011, total floor space “under construction†was roughly 4.6 times the floor space sold/li
liA year and a half worth of excess inventory is hidden somewhere in the pipeline /li
liNew starts in April fell 14.6% year-on-year and 27.0% month-on-month, for property as a whole/li
liHousing starts fell -14.4% year-on-year and -23.4% month-on-month /li
liOffice starts fell -21.0% year-on-year in April, and -45.1% compared to
March/li
liRetail property starts fell -18.7% year-on-year, and -36.8%
compared to March/li
liLand sale revenues in April (RMB 27 billion) were down -54.7% compared to April last year/li
liForeign funding for property development was down -91.4% in March and -80.8% in April, compared to the same months last year. /li
/ul
br /
Clearly a crash is underway. The above stats also show the soft-landing thesis is written on toilet paper.br /
br /
bGDP Analysis/bbr /
br /
I like the analysis by Chovanec on GDP implications and the highly-overrated \"soft landing\" theory.br /
blockquote
The “resilient†growth in real estate investment that seemed to promise a “soft landing†is not very resilient at all. It’s more like the last gasp of a market that’s running out of steam. Once the surge in completions plays out, the declining number of new starts will ibecome/i the pipeline, and growth in property investment will flatten or go
negative.br /
br /
Property investment accounts for roughly a quarter of gross Fixed Asset Investment (FAI), and net FAI accounts for over half of China’s GDP growth. As I a target=\"_blank\" href=\"http://chovanec.wordpress.com/2012/01/17/bbc-chinas-2011-gdp-numbers/\" target=\"_blank\"noted in January/a, in a back-of-the-envelope thought exercise, if property investment plateaus (growth falls to zero), it could shave as much as 2.6
percentage points off of real GDP growth. a href=\"http://chovanec.wordpress.com/2012/01/20/further-thoughts-on-real-estates-impact-on-gdp/\" target=\"_blank\"If it fell 10% /a(in real, not nominal terms) it could bring GDP growth down to 5.3%.br /
br /
At the time I first saw this dynamic in the data, when the Q1 numbers came out, I figured it would take several months to begin playing out. But the April numbers suggest it is already happening. /blockquote
Chovanec notes if real estate investment drops by 10%, GDP will come in at 5.3%. What if real estate investment falls by 20% or 25%? Moreover, why shouldn\'t it?br /
br /
bNails in the Hard Landing Coffin?/bbr /
br /
One of the sillier stories making the rounds earlier last month was a target=\"_blank\" href=\"http://news.yahoo.com/analysis-china-currency-move-nails-hard-landing-risk-023928876.html\" target=\"_blank\"China currency move nails hard landing risk coffin/abr /
br /
I responded at the time with ...br /
blockquote
The longer China puts off rebalancing its economy, the bigger the crash later on. Moreover,
widening the band on its currency is a needed part of that rebalancing, and does not preclude in any way a huge slowdown in growth.br /
br /
The structural imbalances in China are large and for now, still growing. However, huge cracks have appeared in real estate, and changes are
coming up with a regime change. Finally, peak oil alone makes many of the growth estimates we have seen for China outright impossible. /blockquote
The real estate crash has arrived. The GDP crash will follow. For details, please see a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/12-predictions-by-michael-pettis-on.html\"12 Predictions by Michael Pettis on China; Non-Food Commodity Prices Will Collapse Over Next Three to Four Years; Nails in the Hard Landing Coffin?
/a
br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-5198269143082669009?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/Wgp1SQyUyNlQDiun0f-4M24ALjw/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/Wgp1SQyUyNlQDiun0f-4M24ALjw/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/Wgp1SQyUyNlQDiun0f-4M24ALjw/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/Wgp1SQyUyNlQDiun0f-4M24ALjw/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:119:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/DvfOipbedCM/real-estate-crash-in-china-underway.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:91:\"http://globaleconomicanalysis.blogspot.com/2012/05/real-estate-crash-in-china-underway.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:6175:\"Inquiring minds are reading an excellent report a target=\"_blank\" href=\"http://www.economonitor.com/blog/2012/05/china-real-estate-unravels/\"China Real Estate Unravels /aby Patrick Chovanec, a professor at Tsinghua University\'s School of Economics and Management in Beijing, China.br /
br /
The report confirms many of the things I said would happen in regards to the Chinese real estate bubble and GDP.br /
br /
Here are a few items of note.br /
br /
Developers, burdened by 70% leverage ratios and loans threatening to come due, rushed to complete projects already in their pipeline, to put those units onto the market and raise cash.br /
br /
That rush to complete inflated real estate investments, allegedly up 23.5% in the first quarter. Other statistics from the report tell the real story.br /
br /
ul
liYear-on-year sales in Q1, for all real estate, was down 14.6%./li
liResidential property sales were down 17.5%/li
liOffice sales were down -10.2%nbsp;/li
li Sales in January-February were a disaster, falling 20.9% overall,
compared to the first two months of 2011, -24.7% for residential./li
liTotal amount of floor space “for sale†was up 35.5%, compared to the
same date last year/li
liFloor space of residential units “for
sale†grew 47.4%. /li
li At the end of 2011, total floor space “under construction†was roughly 4.6 times the floor space sold/li
liA year and a half worth of excess inventory is hidden somewhere in the pipeline /li
liNew starts in April fell 14.6% year-on-year and 27.0% month-on-month, for property as a whole/li
liHousing starts fell -14.4% year-on-year and -23.4% month-on-month /li
liOffice starts fell -21.0% year-on-year in April, and -45.1% compared to
March/li
liRetail property starts fell -18.7% year-on-year, and -36.8%
compared to March/li
liLand sale revenues in April (RMB 27 billion) were down -54.7% compared to April last year/li
liForeign funding for property development was down -91.4% in March and -80.8% in April, compared to the same months last year. /li
/ul
br /
Clearly a crash is underway. The above stats also show the soft-landing thesis is written on toilet paper.br /
br /
bGDP Analysis/bbr /
br /
I like the analysis by Chovanec on GDP implications and the highly-overrated \"soft landing\" theory.br /
blockquote
The “resilient†growth in real estate investment that seemed to promise a “soft landing†is not very resilient at all. It’s more like the last gasp of a market that’s running out of steam. Once the surge in completions plays out, the declining number of new starts will ibecome/i the pipeline, and growth in property investment will flatten or go
negative.br /
br /
Property investment accounts for roughly a quarter of gross Fixed Asset Investment (FAI), and net FAI accounts for over half of China’s GDP growth. As I a target=\"_blank\" href=\"http://chovanec.wordpress.com/2012/01/17/bbc-chinas-2011-gdp-numbers/\" target=\"_blank\"noted in January/a, in a back-of-the-envelope thought exercise, if property investment plateaus (growth falls to zero), it could shave as much as 2.6
percentage points off of real GDP growth. a href=\"http://chovanec.wordpress.com/2012/01/20/further-thoughts-on-real-estates-impact-on-gdp/\" target=\"_blank\"If it fell 10% /a(in real, not nominal terms) it could bring GDP growth down to 5.3%.br /
br /
At the time I first saw this dynamic in the data, when the Q1 numbers came out, I figured it would take several months to begin playing out. But the April numbers suggest it is already happening. /blockquote
Chovanec notes if real estate investment drops by 10%, GDP will come in at 5.3%. What if real estate investment falls by 20% or 25%? Moreover, why shouldn\'t it?br /
br /
bNails in the Hard Landing Coffin?/bbr /
br /
One of the sillier stories making the rounds earlier last month was a target=\"_blank\" href=\"http://news.yahoo.com/analysis-china-currency-move-nails-hard-landing-risk-023928876.html\" target=\"_blank\"China currency move nails hard landing risk coffin/abr /
br /
I responded at the time with ...br /
blockquote
The longer China puts off rebalancing its economy, the bigger the crash later on. Moreover,
widening the band on its currency is a needed part of that rebalancing, and does not preclude in any way a huge slowdown in growth.br /
br /
The structural imbalances in China are large and for now, still growing. However, huge cracks have appeared in real estate, and changes are
coming up with a regime change. Finally, peak oil alone makes many of the growth estimates we have seen for China outright impossible. /blockquote
The real estate crash has arrived. The GDP crash will follow. For details, please see a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/12-predictions-by-michael-pettis-on.html\"12 Predictions by Michael Pettis on China; Non-Food Commodity Prices Will Collapse Over Next Three to Four Years; Nails in the Hard Landing Coffin?
/a
br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-5198269143082669009?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/Wgp1SQyUyNlQDiun0f-4M24ALjw/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/Wgp1SQyUyNlQDiun0f-4M24ALjw/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/Wgp1SQyUyNlQDiun0f-4M24ALjw/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/Wgp1SQyUyNlQDiun0f-4M24ALjw/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337207940;}i:14;a:22:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-2709071936478402861\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Wed, 16 May 2012 15:22:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-16T10:25:04.447-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:130:\"Capital Flight From Greece Accelerates, €5bn in May, Exodus Even Hits Time Deposits; Fed, ECB, BOE, BOJ Balance Sheet Comparison\";s:12:\"description#\";i:1;s:11:\"description\";s:4579:\"Capital flight from Greece continues, €5bn in May, not counting orders to buy foreign bonds. The exodus now includes cashing out time deposits as reported by the Financial Times in a target=\"_blank\" href=\"http://www.ft.com/intl/cms/s/0/3d588c2e-9f3c-11e1-a455-00144feabdc0.html#axzz1ut97nkvM\"Greek banks see steady deposits outflow/a.br /
blockquote
Greek banks have seen a steady outflow of deposits this month, reflecting savers’ concerns over the failure of political leaders to form a coalition government and the prospect of another inconclusive election, which will be on June 17.br /
br /
Athens-based bankers said withdrawals exceeded €1.2bn on Monday and Tuesday – 0.75 per cent of deposits – as President Karolos Papoulias failed in two final meetings with conservative, socialist and leftwing leaders to form a national unity government.br /
br /
A senior Greek banker said the experience of the past few days “gives rise to concern that withdrawals may accelerateâ€. Another banker said: “We are seeing something very unusual, customers breaking their time deposits in order to withdraw funds.â€br /
br /
“The situation with the banks is extremely difficult ... there is no panic but there is great fear which could turn into panic and the resistance of the banks is very limited just now,†Mr Papoulias told the political leaders on Sunday, according to a transcript of the meeting released by his office.br /
br /
The president cited a briefing by George Provopoulos, the central bank governor, who told him that withdrawals last week reached €700m, excluding funds used to buy German bonds and other foreign securities.br /
br /
One of the Greek bankers said that since the end of April, deposits had been reduced by some €5bn, including orders to buy foreign bonds and securities. /blockquote
Why anyone would have even a cent in Greek bank accounts is a complete mystery. Certainly the smart money left long ago.br /
br /
Here are a few charts courtesy of Steen Jakobsen, chief economist at Saxo Bank in Denmark. br /
br /
bDemand Deposit Flight: Greece, Italy, Portugal, to Germany/bbr /
br /
a target=\"_blank\" href=\"http://2.bp.blogspot.com/-fv1YBOexJ7A/T7PDWGKIq5I/AAAAAAAAPLU/BA_fdX28Y40/s1600/Steen%2B2012-05-16A.png\" imageanchor=\"1\"img border=\"0\" height=\"200\" src=\"http://2.bp.blogspot.com/-fv1YBOexJ7A/T7PDWGKIq5I/AAAAAAAAPLU/BA_fdX28Y40/s400/Steen%2B2012-05-16A.png\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
bECB Deposits/bbr /
br /
a target=\"_blank\" href=\"http://1.bp.blogspot.com/-IiZD7-mKIRA/T7PEGkglwAI/AAAAAAAAPLg/cwdOK6u3tHQ/s1600/Steen%2B2012-05-16B.png\" imageanchor=\"1\"img border=\"0\" height=\"201\" src=\"http://1.bp.blogspot.com/-IiZD7-mKIRA/T7PEGkglwAI/AAAAAAAAPLg/cwdOK6u3tHQ/s400/Steen%2B2012-05-16B.png\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
bCentral Bank Balance Sheets as Percent of GDP/bbr /
br /
a target=\"_blank\" href=\"http://1.bp.blogspot.com/-NtkPG1GkqNA/T7PE4EyzApI/AAAAAAAAPLs/3Op891CkWh8/s1600/Steen%2B2012-05-16C.png\" imageanchor=\"1\"img border=\"0\" height=\"203\" src=\"http://1.bp.blogspot.com/-NtkPG1GkqNA/T7PE4EyzApI/AAAAAAAAPLs/3Op891CkWh8/s400/Steen%2B2012-05-16C.png\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-2709071936478402861?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/1MJog2rxFzt2wwLxBGCH-Dvtrr0/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/1MJog2rxFzt2wwLxBGCH-Dvtrr0/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/1MJog2rxFzt2wwLxBGCH-Dvtrr0/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/1MJog2rxFzt2wwLxBGCH-Dvtrr0/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:122:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/3jv5XSfMdRo/capital-flight-from-greece-accelerates.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:5:\"media\";a:6:{s:10:\"thumbnail#\";i:1;s:10:\"thumbnail@\";s:28:\"xmlns:media,url,height,width\";s:21:\"thumbnail@xmlns:media\";s:29:\"http://search.yahoo.com/mrss/\";s:13:\"thumbnail@url\";s:103:\"http://2.bp.blogspot.com/-fv1YBOexJ7A/T7PDWGKIq5I/AAAAAAAAPLU/BA_fdX28Y40/s72-c/Steen%2B2012-05-16A.png\";s:16:\"thumbnail@height\";s:2:\"72\";s:15:\"thumbnail@width\";s:2:\"72\";}s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:94:\"http://globaleconomicanalysis.blogspot.com/2012/05/capital-flight-from-greece-accelerates.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:4579:\"Capital flight from Greece continues, €5bn in May, not counting orders to buy foreign bonds. The exodus now includes cashing out time deposits as reported by the Financial Times in a target=\"_blank\" href=\"http://www.ft.com/intl/cms/s/0/3d588c2e-9f3c-11e1-a455-00144feabdc0.html#axzz1ut97nkvM\"Greek banks see steady deposits outflow/a.br /
blockquote
Greek banks have seen a steady outflow of deposits this month, reflecting savers’ concerns over the failure of political leaders to form a coalition government and the prospect of another inconclusive election, which will be on June 17.br /
br /
Athens-based bankers said withdrawals exceeded €1.2bn on Monday and Tuesday – 0.75 per cent of deposits – as President Karolos Papoulias failed in two final meetings with conservative, socialist and leftwing leaders to form a national unity government.br /
br /
A senior Greek banker said the experience of the past few days “gives rise to concern that withdrawals may accelerateâ€. Another banker said: “We are seeing something very unusual, customers breaking their time deposits in order to withdraw funds.â€br /
br /
“The situation with the banks is extremely difficult ... there is no panic but there is great fear which could turn into panic and the resistance of the banks is very limited just now,†Mr Papoulias told the political leaders on Sunday, according to a transcript of the meeting released by his office.br /
br /
The president cited a briefing by George Provopoulos, the central bank governor, who told him that withdrawals last week reached €700m, excluding funds used to buy German bonds and other foreign securities.br /
br /
One of the Greek bankers said that since the end of April, deposits had been reduced by some €5bn, including orders to buy foreign bonds and securities. /blockquote
Why anyone would have even a cent in Greek bank accounts is a complete mystery. Certainly the smart money left long ago.br /
br /
Here are a few charts courtesy of Steen Jakobsen, chief economist at Saxo Bank in Denmark. br /
br /
bDemand Deposit Flight: Greece, Italy, Portugal, to Germany/bbr /
br /
a target=\"_blank\" href=\"http://2.bp.blogspot.com/-fv1YBOexJ7A/T7PDWGKIq5I/AAAAAAAAPLU/BA_fdX28Y40/s1600/Steen%2B2012-05-16A.png\" imageanchor=\"1\"img border=\"0\" height=\"200\" src=\"http://2.bp.blogspot.com/-fv1YBOexJ7A/T7PDWGKIq5I/AAAAAAAAPLU/BA_fdX28Y40/s400/Steen%2B2012-05-16A.png\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
bECB Deposits/bbr /
br /
a target=\"_blank\" href=\"http://1.bp.blogspot.com/-IiZD7-mKIRA/T7PEGkglwAI/AAAAAAAAPLg/cwdOK6u3tHQ/s1600/Steen%2B2012-05-16B.png\" imageanchor=\"1\"img border=\"0\" height=\"201\" src=\"http://1.bp.blogspot.com/-IiZD7-mKIRA/T7PEGkglwAI/AAAAAAAAPLg/cwdOK6u3tHQ/s400/Steen%2B2012-05-16B.png\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
bCentral Bank Balance Sheets as Percent of GDP/bbr /
br /
a target=\"_blank\" href=\"http://1.bp.blogspot.com/-NtkPG1GkqNA/T7PE4EyzApI/AAAAAAAAPLs/3Op891CkWh8/s1600/Steen%2B2012-05-16C.png\" imageanchor=\"1\"img border=\"0\" height=\"203\" src=\"http://1.bp.blogspot.com/-NtkPG1GkqNA/T7PE4EyzApI/AAAAAAAAPLs/3Op891CkWh8/s400/Steen%2B2012-05-16C.png\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-2709071936478402861?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/1MJog2rxFzt2wwLxBGCH-Dvtrr0/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/1MJog2rxFzt2wwLxBGCH-Dvtrr0/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/1MJog2rxFzt2wwLxBGCH-Dvtrr0/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/1MJog2rxFzt2wwLxBGCH-Dvtrr0/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337181720;}i:15;a:21:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-1290821992561811277\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Wed, 16 May 2012 07:37:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-16T02:47:33.729-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:158:\"Note to Ambrose Evans-Pritchard at The Telegraph: You Have Excellent Insight as to What is Happening and Why, But Please Get a Grip on Reality as to Solutions\";s:12:\"description#\";i:1;s:11:\"description\";s:8753:\"Once again, I sadly report that Ambrose Evans-Pritchard at iThe Telegraph/i hits the nail on the head as to what is happening, yet cannot hit the broadside of a barn with a shotgun from 15 feet in regards to the solution.br /
br /
It really pains me to see excellent analysis go straight into the toilet with hopeless proposals to problems at hand.br /
br /
Please consider a href=\"http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100017148/appetiser-cost-of-greek-exit-is-e155bn-for-germany-france-trillions-for-meat-course/\" target=\"_blank\"Appetiser cost of Greek exit is €155bn for Germany, France: trillions for meat course/a by Ambrose Evans-Pritchard.
br /
blockquote
Eric Dor\'s team at the IESEG School of Management in Lille has put together a table on the direct costs to Germany and France if Greece is pushed out of the euro.br /
br /
These assume that relations between Europe and Greece break down in acrimony, with a full-fledged \"stuff-you\" default on euro liabilities. It assumes a drachma devaluation of 50pc.br /
br /
Potential losses for the states, including central banks.br /
br /
table border=\"1\" cellpadding=\"0\" cellspacing=\"0\" class=\"blue\" tbody /tbodytbody
tr td valign=\"top\" width=\"243\"br //td td colspan=\"2\" valign=\"top\" width=\"321\"div align=\"center\"
Upper bound of the losses/div
div align=\"center\"
Billions €/div
/td /tr
tr td valign=\"top\" width=\"243\"br //td td valign=\"top\" width=\"166\"div align=\"center\"
French State/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
German State/div
/td /tr
tr td valign=\"top\" width=\"243\"TARGET2 liabilities of the Bank of Greece/td td valign=\"top\" width=\"166\"div align=\"center\"
22.7/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
30.2/div
/td /tr
tr td valign=\"top\" width=\"243\"Greek sovereign bonds held by the Eurosystem: SMP/td td valign=\"top\" width=\"166\"div align=\"center\"
9.8/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
14/div
/td /tr
tr td valign=\"top\" width=\"243\"Bilateral loans to Greece in the context of the first programme/td td valign=\"top\" width=\"166\"div align=\"center\"
i11.4/i/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
15.1/div
/td /tr
tr td valign=\"top\" width=\"243\"Guarantees to bonds issued by the EFSF to provide loans to Greece in the context of the second programme/td td valign=\"top\" width=\"166\"div align=\"center\"
8.4/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
11.2/div
/td /tr
tr td valign=\"top\" width=\"243\"Guarantees to debts issued by the EFSF in the context of its participation to the “Private Sector Involvement†–restructuration of the Greek debt:“sweetenerâ€/td td valign=\"top\" width=\"166\"div align=\"center\"
6.5/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
8.6/div
/td /tr
tr td valign=\"top\" width=\"243\"Guarantees to debts issued by the EFSF in the context of its participation to the “Private Sector Involvement†–restructuration of the Greek debt: payment of accrued interest/td td valign=\"top\" width=\"166\"div align=\"center\"
1/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
1.4/div
/td /tr
tr td valign=\"top\" width=\"243\"Guarantees to bonds issued by the EFSF to provide loans to Greece in order to buy back sovereign bonds used by banks as collateral to obtain funding from the Eurosystem/td td valign=\"top\" width=\"166\"div align=\"center\"
7.6/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
10.2/div
/td /tr
tr td valign=\"top\" width=\"243\"div align=\"center\"
Total/div
/td td valign=\"top\" width=\"166\"div align=\"center\"
66.4/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
89.8/div
/td /tr
/tbody/table
br /
br /
Sounds about right./blockquote
So far so good. I think a 70% devaluation is about right, but let\'s not quibble.br /
br /
bContagion Silliness/bbr /
br /
This is where Pritchard\'s analysis starts getting more debatable.br /
br /
Pritchard writes ...\"iNeedless to say, the real danger is contagion to Portugal, Ireland,
Spain, Italy, Belgium, France, and the deadly linkages between €15
trillion in public and private debt in these countries and the €27
trillion European banking nexus./i\"br /
br /
This idea of contagion sounds much like the totally discredited \"domino\" theory in regards to Vietnam. Simply put the rest of Asia did not fall into the hands of communists when the US lost the war in Vietnam.br /
br /
In this case, Spain will sink or swim on its own merits regardless of what Greece does.br /
br /
If anything, there will be contagion in the reverse sense. There exists a possibility that Greece recovers \"ibecause/i\" it exits the Eurozone (however structural reforms are needed as well).br /
br /
The ridiculous fear is failure in Greece will lead to a failure in Spain. Clearly both states have failed already. br /
br /
bMad Hatter Tirade/bbr /
br /
Pritchard then went off the deep end into a mad hatter tirade.br /
blockquote class=\"tr_bq\"
This nonsense can of course be stopped in ten minutes if the EU:br /
br /
1) announces that it will equip itself with a real central bank (a
lender of last resort) that takes all risk of sovereign default off the
table — with conviction and overwhelming force, with no ifs and buts,
and no ambushes from the Bundesbank.br /
br /
2) announces EMU debt-pooling, fiscal union, a joint EMU budget and
tax system, and an EMU government as a counterpart for the enhanced the
ECB./blockquote
br /
The idea that Greece and Spain can be saved by central bank printing \"iwith conviction and overwhelming force, with no ifs and buts/i\" is of course asinine.br /
br /
Sorry Ambrose, \"asinine\" is the best word that describes what you propose. Greece and Spain can only be saved if and only if they implement badly-needed structural reforms. br /
br /
Defaulting on debt which would cause inflation in Greece and Spain (not Germany), may assist recovery, but the 100% necessary condition in both cases is structural reform. br /
br /
Pritchard then recovers by concluding ...
br /
blockquote
My sympathies to the German people. This is what your leaders got you into (without asking permission). It was the elemental implication of monetary union.br /
br /
We at the Telegraph screamed from rooftops in the early 1990s that EMU was a destroyer of nation states, and democracies. So did the brave German professors. Nobody would listen.br /
br /
My guess is that German citizens will not accept this implication./blockquote
bPrecisely!/bbr /
br /
As Pritchard suggests, Germany will indeed pay. Mathematically Germany must pay. It\'s something I have pointed out numerous times over the years.br /
br /
The problem as Pritchard notes is the flaw in the Eurozone in the first place. br /
br /
I commend Pritchard for being among the first to point that simple fact out. However, neither Keynesian nor Monetarist nonsense is the cure for anything.br /
br /
Regrettably, Pritchard keeps attempting to put a square peg into a round hole, and worse yet keeps proposing \"asinine\" solutions to a fundamental problem.br /
br /
bIf Wishes Were Fishes /bbr /
br /
ul
liIf monetary stimulus worked, the LTRO would have been a spectacular success already.nbsp;/li
liIf monetary stimulus worked, housing in the US would be in full-blown recovery./li
liIf monetary stimulus worked, Japan would not have a debt-to-GDP ratio above 200%.nbsp;/li
liIf printing worked, Zimbabwe would have been the greatest country in the world long ago./li
/ul
br /
It is really sad to see otherwise fine analysis go straight into the toilet with such ridiculous proposals as solutions.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-1290821992561811277?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/IxrIfxi5Sg094_jlH1BblJ9AeNw/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/IxrIfxi5Sg094_jlH1BblJ9AeNw/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/IxrIfxi5Sg094_jlH1BblJ9AeNw/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/IxrIfxi5Sg094_jlH1BblJ9AeNw/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:118:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/NgrJnBGGB3c/note-to-ambrose-evans-pritchard-at.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:90:\"http://globaleconomicanalysis.blogspot.com/2012/05/note-to-ambrose-evans-pritchard-at.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:8753:\"Once again, I sadly report that Ambrose Evans-Pritchard at iThe Telegraph/i hits the nail on the head as to what is happening, yet cannot hit the broadside of a barn with a shotgun from 15 feet in regards to the solution.br /
br /
It really pains me to see excellent analysis go straight into the toilet with hopeless proposals to problems at hand.br /
br /
Please consider a href=\"http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100017148/appetiser-cost-of-greek-exit-is-e155bn-for-germany-france-trillions-for-meat-course/\" target=\"_blank\"Appetiser cost of Greek exit is €155bn for Germany, France: trillions for meat course/a by Ambrose Evans-Pritchard.
br /
blockquote
Eric Dor\'s team at the IESEG School of Management in Lille has put together a table on the direct costs to Germany and France if Greece is pushed out of the euro.br /
br /
These assume that relations between Europe and Greece break down in acrimony, with a full-fledged \"stuff-you\" default on euro liabilities. It assumes a drachma devaluation of 50pc.br /
br /
Potential losses for the states, including central banks.br /
br /
table border=\"1\" cellpadding=\"0\" cellspacing=\"0\" class=\"blue\" tbody /tbodytbody
tr td valign=\"top\" width=\"243\"br //td td colspan=\"2\" valign=\"top\" width=\"321\"div align=\"center\"
Upper bound of the losses/div
div align=\"center\"
Billions €/div
/td /tr
tr td valign=\"top\" width=\"243\"br //td td valign=\"top\" width=\"166\"div align=\"center\"
French State/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
German State/div
/td /tr
tr td valign=\"top\" width=\"243\"TARGET2 liabilities of the Bank of Greece/td td valign=\"top\" width=\"166\"div align=\"center\"
22.7/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
30.2/div
/td /tr
tr td valign=\"top\" width=\"243\"Greek sovereign bonds held by the Eurosystem: SMP/td td valign=\"top\" width=\"166\"div align=\"center\"
9.8/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
14/div
/td /tr
tr td valign=\"top\" width=\"243\"Bilateral loans to Greece in the context of the first programme/td td valign=\"top\" width=\"166\"div align=\"center\"
i11.4/i/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
15.1/div
/td /tr
tr td valign=\"top\" width=\"243\"Guarantees to bonds issued by the EFSF to provide loans to Greece in the context of the second programme/td td valign=\"top\" width=\"166\"div align=\"center\"
8.4/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
11.2/div
/td /tr
tr td valign=\"top\" width=\"243\"Guarantees to debts issued by the EFSF in the context of its participation to the “Private Sector Involvement†–restructuration of the Greek debt:“sweetenerâ€/td td valign=\"top\" width=\"166\"div align=\"center\"
6.5/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
8.6/div
/td /tr
tr td valign=\"top\" width=\"243\"Guarantees to debts issued by the EFSF in the context of its participation to the “Private Sector Involvement†–restructuration of the Greek debt: payment of accrued interest/td td valign=\"top\" width=\"166\"div align=\"center\"
1/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
1.4/div
/td /tr
tr td valign=\"top\" width=\"243\"Guarantees to bonds issued by the EFSF to provide loans to Greece in order to buy back sovereign bonds used by banks as collateral to obtain funding from the Eurosystem/td td valign=\"top\" width=\"166\"div align=\"center\"
7.6/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
10.2/div
/td /tr
tr td valign=\"top\" width=\"243\"div align=\"center\"
Total/div
/td td valign=\"top\" width=\"166\"div align=\"center\"
66.4/div
/td td valign=\"top\" width=\"155\"div align=\"center\"
89.8/div
/td /tr
/tbody/table
br /
br /
Sounds about right./blockquote
So far so good. I think a 70% devaluation is about right, but let\'s not quibble.br /
br /
bContagion Silliness/bbr /
br /
This is where Pritchard\'s analysis starts getting more debatable.br /
br /
Pritchard writes ...\"iNeedless to say, the real danger is contagion to Portugal, Ireland,
Spain, Italy, Belgium, France, and the deadly linkages between €15
trillion in public and private debt in these countries and the €27
trillion European banking nexus./i\"br /
br /
This idea of contagion sounds much like the totally discredited \"domino\" theory in regards to Vietnam. Simply put the rest of Asia did not fall into the hands of communists when the US lost the war in Vietnam.br /
br /
In this case, Spain will sink or swim on its own merits regardless of what Greece does.br /
br /
If anything, there will be contagion in the reverse sense. There exists a possibility that Greece recovers \"ibecause/i\" it exits the Eurozone (however structural reforms are needed as well).br /
br /
The ridiculous fear is failure in Greece will lead to a failure in Spain. Clearly both states have failed already. br /
br /
bMad Hatter Tirade/bbr /
br /
Pritchard then went off the deep end into a mad hatter tirade.br /
blockquote class=\"tr_bq\"
This nonsense can of course be stopped in ten minutes if the EU:br /
br /
1) announces that it will equip itself with a real central bank (a
lender of last resort) that takes all risk of sovereign default off the
table — with conviction and overwhelming force, with no ifs and buts,
and no ambushes from the Bundesbank.br /
br /
2) announces EMU debt-pooling, fiscal union, a joint EMU budget and
tax system, and an EMU government as a counterpart for the enhanced the
ECB./blockquote
br /
The idea that Greece and Spain can be saved by central bank printing \"iwith conviction and overwhelming force, with no ifs and buts/i\" is of course asinine.br /
br /
Sorry Ambrose, \"asinine\" is the best word that describes what you propose. Greece and Spain can only be saved if and only if they implement badly-needed structural reforms. br /
br /
Defaulting on debt which would cause inflation in Greece and Spain (not Germany), may assist recovery, but the 100% necessary condition in both cases is structural reform. br /
br /
Pritchard then recovers by concluding ...
br /
blockquote
My sympathies to the German people. This is what your leaders got you into (without asking permission). It was the elemental implication of monetary union.br /
br /
We at the Telegraph screamed from rooftops in the early 1990s that EMU was a destroyer of nation states, and democracies. So did the brave German professors. Nobody would listen.br /
br /
My guess is that German citizens will not accept this implication./blockquote
bPrecisely!/bbr /
br /
As Pritchard suggests, Germany will indeed pay. Mathematically Germany must pay. It\'s something I have pointed out numerous times over the years.br /
br /
The problem as Pritchard notes is the flaw in the Eurozone in the first place. br /
br /
I commend Pritchard for being among the first to point that simple fact out. However, neither Keynesian nor Monetarist nonsense is the cure for anything.br /
br /
Regrettably, Pritchard keeps attempting to put a square peg into a round hole, and worse yet keeps proposing \"asinine\" solutions to a fundamental problem.br /
br /
bIf Wishes Were Fishes /bbr /
br /
ul
liIf monetary stimulus worked, the LTRO would have been a spectacular success already.nbsp;/li
liIf monetary stimulus worked, housing in the US would be in full-blown recovery./li
liIf monetary stimulus worked, Japan would not have a debt-to-GDP ratio above 200%.nbsp;/li
liIf printing worked, Zimbabwe would have been the greatest country in the world long ago./li
/ul
br /
It is really sad to see otherwise fine analysis go straight into the toilet with such ridiculous proposals as solutions.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-1290821992561811277?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/IxrIfxi5Sg094_jlH1BblJ9AeNw/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/IxrIfxi5Sg094_jlH1BblJ9AeNw/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/IxrIfxi5Sg094_jlH1BblJ9AeNw/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/IxrIfxi5Sg094_jlH1BblJ9AeNw/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337153820;}i:16;a:22:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-1842810312004833125\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Wed, 16 May 2012 00:04:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-15T23:15:46.373-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:189:\"Spain Potpourri: Official Denials From Finance Minister; More Nationalizations Coming Up; Banks Use ECB Money to Refinance Large Enterprises in Dire Shape, New Credit To Households Down 80%\";s:12:\"description#\";i:1;s:11:\"description\";s:9304:\"bOfficial Denials From Finance Minister/bbr /
br /
a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.libremercado.com%2F2012-05-15%2Fde-guindos-pide-al-bce-que-colabore-en-la-auditoria-de-la-banca-espanola-1276458548%2Famp;act=url\" target=\"_blank\"Finance Minister Says \"Nothing to Hide\" Asks for ECB Audit of Banks, Denies Need for Rescue Fund /abr /
blockquote
The Economy Minister Luis de Guindos, said Tuesday it has asked the European Central Bank (ECB) to assist in the independent audit of the Spanish banks\' balance sheets and is committed to full throttle work as has asked the Eurogroup, in order to have results within two months.br /
br /
In addition Guindos assured that no minister of economy of the eurozone has said that Spain should come to the rescue fund EU to recapitalize their banks.br /
br /
\"There is nothing to hide, believe that the reform we are doing is a reform that clarifies and introduces transparency and clarity in balance sheets and the Spanish government has a will very clear about it,\" stressed the Minister of Economy.br /
br /
\"Nobody has spoken at all to go to the bailout fund, is a matter of speed independent valuations,\" has settled the finance minister when asked about whether Spain would seek assistance from the EU to help banks unable to meet the requirements of provisions providing for the reform./blockquote
bAnother 30 Billion Euros Needed, More Nationalizations Coming Up /bbr /
br /
a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.libremercado.com%2F2012-05-12%2Flos-bancos-que-no-devuelvan-las-ayudas-en-5-anos-seran-nacionalizados-1276458332%2Famp;act=url\" target=\"_blank\"Banks that do not return the aid within 5 years will be nationalized/abr /
blockquote
The State nationalize financial institutions that do not return within five years aid articulated through convertible bonds, the so-called \'coconuts\', designed to \'clean up\' their balance sheets of real estate assets.br /
br /
This is particular the Legislative Decree on Saturday published the Official Gazette (BOE), which requires banks additional sanitation EUR 30,000 million credit-linked unproblematic \'brick\'.br /
br /
After this period, the Bank Restructuring Fund (FROB), through which the state sanctions the \'coconut\', have a maximum of six months to implement in practice what would be nationalization of the entity.br /
br /
However, the rule empowers the Bank of Spain to proceed with the conversion of shares before those five years when it considers \"unlikely\" that a particular bank can afford to pay for this help.br /
br /
And if the entity defaults on the repayment of the aid, the regulator may also temporarily replace the administrative or management of the entity, which would eventually assuming his speech.br /
br /
Spanish banks must set aside another 30,000 million for provisioning loans to real estate developer and healthy yet recorded incidents of payment. /blockquote
bCollapse in Credit/bbr /
br /
a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.libremercado.com%2F2012-05-13%2Fla-banca-usa-el-dinero-del-bce-para-refinanciar-a-grandes-empresas-1276458358%2Famp;act=url\" target=\"_blank\"Banks Use ECB Money to Refinance Large Enterprises, New Credit To Households Down 80%/abr /
blockquote
Loans from the European Central Bank (ECB) for Spanish banks are finally beginning to be seen in the figures for new credit. After many months of fall shows signs of stabilization and down only 1.5%. However, the news is not as good as it seems.br /
br /
If we analyze the data by sector we find that the money has not been evenly distributed, but for families and small business loan new credit falls with increasing strength while for the general business credit do you see a recovery (+8.9% compared to March 2011). These loans are likely to mostly be treated refinancing to large companies in dire financial shape, given the terrible sales data that are being seen in recent months.br /
br /
In the first graph we see the evolution of total credit, which appears to show signs of stabilization, at present, about 50,000 million / month, less than half that seen at the peak of the bubble. We can also see the credit business, which also stabilizes over 45,000 million / month, less than 60% of what was in 2007, and the family is declining and is already below the 6,000 million / month, less than a quarter of what had in 2007.br /
br /
a href=\"http://4.bp.blogspot.com/-yvM4cVa3GAs/T7LpKAy_t-I/AAAAAAAAPKs/8xQQKRK29T0/s1600/spain%2Bcredit%2B1.png\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"345\" src=\"http://4.bp.blogspot.com/-yvM4cVa3GAs/T7LpKAy_t-I/AAAAAAAAPKs/8xQQKRK29T0/s400/spain%2Bcredit%2B1.png\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
The following graph we can see the evolution of new credit to households, broken down into housing, which fell by 21.7% compared to March 2011 (down nearly 80% from maximum), consumption, whose rate of decline increases to 10 , 2% (also down almost 80% from maximum), and other purposes, which drops to 9.8% (almost 70% from maximum). Families, therefore, despite the extraordinary liquidity injections to three years of the ECB (LTROs) were the tap is closing more and more credit.br /
br /
a href=\"http://1.bp.blogspot.com/-pEiRECmBT58/T7Lp6_zVpcI/AAAAAAAAPK4/Ra1y0p_295I/s1600/spain%2Bcredit%2B2.png\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"326\" src=\"http://1.bp.blogspot.com/-pEiRECmBT58/T7Lp6_zVpcI/AAAAAAAAPK4/Ra1y0p_295I/s400/spain%2Bcredit%2B2.png\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
The situation for the small business credit, which is what you see in the chart below, is very similar. Increases its rate of decline to 14.8% and down almost 60% from highs. However, the situation for the great credit business is very different. Increases by 8.9% over March 2011 and down only just over 36% from highs.br /
br /
There is no doubt that banks are giving priority to these large companies, which not only get much more credit than all other sectors combined (despite employing only a third of private sector employees) but also , are increasing their participation in the growing pie, as they have gone to get before the crisis over 40% of loans over 60% right now.br /
br /
a href=\"http://4.bp.blogspot.com/-mIsWcpR8lQQ/T7LqmOcfsQI/AAAAAAAAPLE/-DevunJZleQ/s1600/spain%2Bcredit%2B3.png\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"298\" src=\"http://4.bp.blogspot.com/-mIsWcpR8lQQ/T7LqmOcfsQI/AAAAAAAAPLE/-DevunJZleQ/s400/spain%2Bcredit%2B3.png\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
The privileges of these big companies do not end here, since the conditions are also radically different for large and small loan. If before the crisis the difference used to be 100 basis points (bp), 1% or so, now the widening and extending more and reaches the 266 bp (2.66%).br /
br /
Everything indicates that Spain is moving increasingly in the Anglo-Saxons called crony capitalism , but as an Iberian, ie banks that also pays to be the handouts to their favorites regardless of purely commercial factors. This can only affect an increasingly inefficient allocation of resources and a poorer functioning of markets, which will only further reduce the resilience of our economy in a globalized world increasingly difficult. /blockquote
bPonzi Financing/bbr /
br /
Those charts show the Spain is banking system is in deep, deep trouble in spite of official denials from the finance minister. br /
br /
Ponzi financing of the largest enterprises is the name of the game and the bond market has zeroed in on it. Yield on the 10-year bond has soared to 6.35%. I expect back above 7% soon.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-1842810312004833125?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/z2NtXI75RERrBbG-XJ6JoIYfjQ8/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/z2NtXI75RERrBbG-XJ6JoIYfjQ8/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/z2NtXI75RERrBbG-XJ6JoIYfjQ8/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/z2NtXI75RERrBbG-XJ6JoIYfjQ8/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:124:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/gAiK9u_gluU/spain-potpourri-official-denials-from_15.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:5:\"media\";a:6:{s:10:\"thumbnail#\";i:1;s:10:\"thumbnail@\";s:28:\"xmlns:media,url,height,width\";s:21:\"thumbnail@xmlns:media\";s:29:\"http://search.yahoo.com/mrss/\";s:13:\"thumbnail@url\";s:102:\"http://4.bp.blogspot.com/-yvM4cVa3GAs/T7LpKAy_t-I/AAAAAAAAPKs/8xQQKRK29T0/s72-c/spain%2Bcredit%2B1.png\";s:16:\"thumbnail@height\";s:2:\"72\";s:15:\"thumbnail@width\";s:2:\"72\";}s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:96:\"http://globaleconomicanalysis.blogspot.com/2012/05/spain-potpourri-official-denials-from_15.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:9304:\"bOfficial Denials From Finance Minister/bbr /
br /
a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.libremercado.com%2F2012-05-15%2Fde-guindos-pide-al-bce-que-colabore-en-la-auditoria-de-la-banca-espanola-1276458548%2Famp;act=url\" target=\"_blank\"Finance Minister Says \"Nothing to Hide\" Asks for ECB Audit of Banks, Denies Need for Rescue Fund /abr /
blockquote
The Economy Minister Luis de Guindos, said Tuesday it has asked the European Central Bank (ECB) to assist in the independent audit of the Spanish banks\' balance sheets and is committed to full throttle work as has asked the Eurogroup, in order to have results within two months.br /
br /
In addition Guindos assured that no minister of economy of the eurozone has said that Spain should come to the rescue fund EU to recapitalize their banks.br /
br /
\"There is nothing to hide, believe that the reform we are doing is a reform that clarifies and introduces transparency and clarity in balance sheets and the Spanish government has a will very clear about it,\" stressed the Minister of Economy.br /
br /
\"Nobody has spoken at all to go to the bailout fund, is a matter of speed independent valuations,\" has settled the finance minister when asked about whether Spain would seek assistance from the EU to help banks unable to meet the requirements of provisions providing for the reform./blockquote
bAnother 30 Billion Euros Needed, More Nationalizations Coming Up /bbr /
br /
a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.libremercado.com%2F2012-05-12%2Flos-bancos-que-no-devuelvan-las-ayudas-en-5-anos-seran-nacionalizados-1276458332%2Famp;act=url\" target=\"_blank\"Banks that do not return the aid within 5 years will be nationalized/abr /
blockquote
The State nationalize financial institutions that do not return within five years aid articulated through convertible bonds, the so-called \'coconuts\', designed to \'clean up\' their balance sheets of real estate assets.br /
br /
This is particular the Legislative Decree on Saturday published the Official Gazette (BOE), which requires banks additional sanitation EUR 30,000 million credit-linked unproblematic \'brick\'.br /
br /
After this period, the Bank Restructuring Fund (FROB), through which the state sanctions the \'coconut\', have a maximum of six months to implement in practice what would be nationalization of the entity.br /
br /
However, the rule empowers the Bank of Spain to proceed with the conversion of shares before those five years when it considers \"unlikely\" that a particular bank can afford to pay for this help.br /
br /
And if the entity defaults on the repayment of the aid, the regulator may also temporarily replace the administrative or management of the entity, which would eventually assuming his speech.br /
br /
Spanish banks must set aside another 30,000 million for provisioning loans to real estate developer and healthy yet recorded incidents of payment. /blockquote
bCollapse in Credit/bbr /
br /
a href=\"http://translate.google.com/translate?sl=autoamp;tl=enamp;js=namp;prev=_tamp;hl=enamp;ie=UTF-8amp;layout=2amp;eotf=1amp;u=http%3A%2F%2Fwww.libremercado.com%2F2012-05-13%2Fla-banca-usa-el-dinero-del-bce-para-refinanciar-a-grandes-empresas-1276458358%2Famp;act=url\" target=\"_blank\"Banks Use ECB Money to Refinance Large Enterprises, New Credit To Households Down 80%/abr /
blockquote
Loans from the European Central Bank (ECB) for Spanish banks are finally beginning to be seen in the figures for new credit. After many months of fall shows signs of stabilization and down only 1.5%. However, the news is not as good as it seems.br /
br /
If we analyze the data by sector we find that the money has not been evenly distributed, but for families and small business loan new credit falls with increasing strength while for the general business credit do you see a recovery (+8.9% compared to March 2011). These loans are likely to mostly be treated refinancing to large companies in dire financial shape, given the terrible sales data that are being seen in recent months.br /
br /
In the first graph we see the evolution of total credit, which appears to show signs of stabilization, at present, about 50,000 million / month, less than half that seen at the peak of the bubble. We can also see the credit business, which also stabilizes over 45,000 million / month, less than 60% of what was in 2007, and the family is declining and is already below the 6,000 million / month, less than a quarter of what had in 2007.br /
br /
a href=\"http://4.bp.blogspot.com/-yvM4cVa3GAs/T7LpKAy_t-I/AAAAAAAAPKs/8xQQKRK29T0/s1600/spain%2Bcredit%2B1.png\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"345\" src=\"http://4.bp.blogspot.com/-yvM4cVa3GAs/T7LpKAy_t-I/AAAAAAAAPKs/8xQQKRK29T0/s400/spain%2Bcredit%2B1.png\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
The following graph we can see the evolution of new credit to households, broken down into housing, which fell by 21.7% compared to March 2011 (down nearly 80% from maximum), consumption, whose rate of decline increases to 10 , 2% (also down almost 80% from maximum), and other purposes, which drops to 9.8% (almost 70% from maximum). Families, therefore, despite the extraordinary liquidity injections to three years of the ECB (LTROs) were the tap is closing more and more credit.br /
br /
a href=\"http://1.bp.blogspot.com/-pEiRECmBT58/T7Lp6_zVpcI/AAAAAAAAPK4/Ra1y0p_295I/s1600/spain%2Bcredit%2B2.png\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"326\" src=\"http://1.bp.blogspot.com/-pEiRECmBT58/T7Lp6_zVpcI/AAAAAAAAPK4/Ra1y0p_295I/s400/spain%2Bcredit%2B2.png\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
The situation for the small business credit, which is what you see in the chart below, is very similar. Increases its rate of decline to 14.8% and down almost 60% from highs. However, the situation for the great credit business is very different. Increases by 8.9% over March 2011 and down only just over 36% from highs.br /
br /
There is no doubt that banks are giving priority to these large companies, which not only get much more credit than all other sectors combined (despite employing only a third of private sector employees) but also , are increasing their participation in the growing pie, as they have gone to get before the crisis over 40% of loans over 60% right now.br /
br /
a href=\"http://4.bp.blogspot.com/-mIsWcpR8lQQ/T7LqmOcfsQI/AAAAAAAAPLE/-DevunJZleQ/s1600/spain%2Bcredit%2B3.png\" imageanchor=\"1\" target=\"_blank\"img border=\"0\" height=\"298\" src=\"http://4.bp.blogspot.com/-mIsWcpR8lQQ/T7LqmOcfsQI/AAAAAAAAPLE/-DevunJZleQ/s400/spain%2Bcredit%2B3.png\" width=\"400\" //abr /
br /
div style=\"color: #660000;\"
click on chart for sharper image/div
br /
The privileges of these big companies do not end here, since the conditions are also radically different for large and small loan. If before the crisis the difference used to be 100 basis points (bp), 1% or so, now the widening and extending more and reaches the 266 bp (2.66%).br /
br /
Everything indicates that Spain is moving increasingly in the Anglo-Saxons called crony capitalism , but as an Iberian, ie banks that also pays to be the handouts to their favorites regardless of purely commercial factors. This can only affect an increasingly inefficient allocation of resources and a poorer functioning of markets, which will only further reduce the resilience of our economy in a globalized world increasingly difficult. /blockquote
bPonzi Financing/bbr /
br /
Those charts show the Spain is banking system is in deep, deep trouble in spite of official denials from the finance minister. br /
br /
Ponzi financing of the largest enterprises is the name of the game and the bond market has zeroed in on it. Yield on the 10-year bond has soared to 6.35%. I expect back above 7% soon.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-1842810312004833125?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/z2NtXI75RERrBbG-XJ6JoIYfjQ8/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/z2NtXI75RERrBbG-XJ6JoIYfjQ8/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/z2NtXI75RERrBbG-XJ6JoIYfjQ8/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/z2NtXI75RERrBbG-XJ6JoIYfjQ8/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337126640;}i:17;a:21:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-2348602537997260637\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Tue, 15 May 2012 22:48:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-15T17:48:03.692-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:154:\"Screeching Halt in China; Weak Trade Data; Imports and Exports Fall Way Short of Expectations; Credit Crunch Underway; Feeble Forecasts From Pimco, Others\";s:12:\"description#\";i:1;s:11:\"description\";s:6401:\"China bulls are in for a multi-year shock because rebalancing from an economy overly dependent on exports is going to be far more painful, and last much longer than most think. Data is coming in much weaker than expected, but I propose this is only the very beginning.br /
br /
The iNew York Times/i reports a href=\"http://www.cnbc.com/id/47379935\" target=\"_blank\"Data Signal Economic Trouble in China/abr /
blockquote
China announced Thursday that growth in imports had unexpectedly come to a screeching halt in April — rising just 0.3 percent from the same period a year earlier, compared with expectations for an 11 percent increase. Businesses across the country appeared to lose much of their appetite for products as varied as iron ore and computer chips.br /
br /
Growth in other sectors appears to be slowing, too, particularly in real estate. Soufun Holdings, a Chinese real estate data provider, released figures Monday showing that residential land sales in the country’s 20 largest cities had fallen 92 percent last week from the week before, as declining prices for apartments have left developers short of cash and reluctant to start further projects.br /
br /
In a series of interviews over the past week, bankers and senior executives from provinces all over China, in a range of light and heavy industries, cited a broad deterioration in business conditions. Two of them said that some tax agencies in smaller cities had been telling companies to inflate their sales and profits to make local economic growth look less weak than it really was, while reassuring the companies that their actual tax bills would be left unchanged.br /
br /
There are early signs of a credit crunch, at least among private sector companies. Many seem to be asking their suppliers for more time to pay debts and complaining of cash flow problems. Zhang Jinmei, the sales manager at Qitele Group, a company that makes playground equipment in the coastal city of Wenzhou, said that local investment and lending pools there were starting to charge higher interest rates for loans, a sign of worries about creditworthiness./blockquote
bImports and Exports Fall Way Short of Expectations/bbr /
br /
The iFinancial Times/i reports a href=\"http://blogs.ft.com/beyond-brics/2012/05/10/china-trade-warning-signals/#axzz1uTbaSwRf\" target=\"_blank\"China trade: warning signals/a.br /
blockquote
Whichever way you look at it, China’s latest set of trade figures is bad news. Not only did both exports and imports fall short of expectations, they missed by quite a way.br /
br /
Although the first half of 2012 was expected to be a tough one, analysts say action is needed soon if the Q3 rebound many have been pinning their hopes on is going to happen at all.br /
br /
If the large jump in the trade surplus is the symptom, the economic illnesses look multiple.br /
br /
Exports have fallen to Europe for the second month in a row, which, from a trade perspective, makes this a low-point since the opening depths of economic crisis.br /
br /
That Chinese imports have fallen even faster is the greater worry. Many had hoped that Chinese shoppers (and builders) would rescue the rest of the world with a voracious appetite for everything. But that seems not to be the case, at least not until the credit taps are turned back on./blockquote
bEasily Predictable/bbr /
br /
All of this was easily predictable yet most did not see this coming and fewer still still see what is ahead. For example please consider this a href=\"http://www.bloomberg.com/news/2012-05-14/china-growth-seen-at-13-year-low-by-pimco.html\" target=\"_blank\"feeble China forecast by PIMCO/a.br /
blockquote
China’s slowdown may deepen as policy makers unwind the excesses of a record credit boom while only gradually increasing stimulus, leaving 2012 growth at the weakest in 13 years, Pacific Investment Management Co. says.br /
br /
“The economy is unlikely to bottom until the third quarter,†Ramin Toloui, Pimco’s global co-head of emerging markets portfolio management in Singapore, said in e-mailed comments May 13.br /
br /
Pimco, which oversees the world’s largest bond fund, sees Chinese growth this year in the “mid-7 percent range,†a pace unseen since 1999. Its call is still lower than that of banks from Citigroup Inc. and JPMorgan Chase amp; Co. to Bank of America Corp. and UBS AG, which all pared their forecasts after April economic data were released last week./blockquote
bBottom When?/bbr /
br /
Note the feeble forecasts by Pimco, Citigroup, JP Morgan, Bank of America, and UBS.br /
br /
And what\'s with this bottom call by Pimco in the third quarter? I have to ask, third quarter of what year? 2020?br /
br /
What a bunch of collective bunk!br /
br /
I am sticking with 3.5% average growth for the rest of the decade, an idea proposed by Michael Pettis in a bet withi The Economist/i. For details, please see a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/12-predictions-by-michael-pettis-on.html\" target=\"_blank\"12 Predictions by Michael Pettis on China; Non-Food Commodity Prices Will Collapse Over Next Three to Four Years; Nails in the Hard Landing Coffin?/abr /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-2348602537997260637?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/xgsUwNVmo57LZSt_2IAkTgpy_Ws/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/xgsUwNVmo57LZSt_2IAkTgpy_Ws/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/xgsUwNVmo57LZSt_2IAkTgpy_Ws/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/xgsUwNVmo57LZSt_2IAkTgpy_Ws/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:119:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/OSPE2ZCunYM/screeching-halt-in-china-weak-trade.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:91:\"http://globaleconomicanalysis.blogspot.com/2012/05/screeching-halt-in-china-weak-trade.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:6401:\"China bulls are in for a multi-year shock because rebalancing from an economy overly dependent on exports is going to be far more painful, and last much longer than most think. Data is coming in much weaker than expected, but I propose this is only the very beginning.br /
br /
The iNew York Times/i reports a href=\"http://www.cnbc.com/id/47379935\" target=\"_blank\"Data Signal Economic Trouble in China/abr /
blockquote
China announced Thursday that growth in imports had unexpectedly come to a screeching halt in April — rising just 0.3 percent from the same period a year earlier, compared with expectations for an 11 percent increase. Businesses across the country appeared to lose much of their appetite for products as varied as iron ore and computer chips.br /
br /
Growth in other sectors appears to be slowing, too, particularly in real estate. Soufun Holdings, a Chinese real estate data provider, released figures Monday showing that residential land sales in the country’s 20 largest cities had fallen 92 percent last week from the week before, as declining prices for apartments have left developers short of cash and reluctant to start further projects.br /
br /
In a series of interviews over the past week, bankers and senior executives from provinces all over China, in a range of light and heavy industries, cited a broad deterioration in business conditions. Two of them said that some tax agencies in smaller cities had been telling companies to inflate their sales and profits to make local economic growth look less weak than it really was, while reassuring the companies that their actual tax bills would be left unchanged.br /
br /
There are early signs of a credit crunch, at least among private sector companies. Many seem to be asking their suppliers for more time to pay debts and complaining of cash flow problems. Zhang Jinmei, the sales manager at Qitele Group, a company that makes playground equipment in the coastal city of Wenzhou, said that local investment and lending pools there were starting to charge higher interest rates for loans, a sign of worries about creditworthiness./blockquote
bImports and Exports Fall Way Short of Expectations/bbr /
br /
The iFinancial Times/i reports a href=\"http://blogs.ft.com/beyond-brics/2012/05/10/china-trade-warning-signals/#axzz1uTbaSwRf\" target=\"_blank\"China trade: warning signals/a.br /
blockquote
Whichever way you look at it, China’s latest set of trade figures is bad news. Not only did both exports and imports fall short of expectations, they missed by quite a way.br /
br /
Although the first half of 2012 was expected to be a tough one, analysts say action is needed soon if the Q3 rebound many have been pinning their hopes on is going to happen at all.br /
br /
If the large jump in the trade surplus is the symptom, the economic illnesses look multiple.br /
br /
Exports have fallen to Europe for the second month in a row, which, from a trade perspective, makes this a low-point since the opening depths of economic crisis.br /
br /
That Chinese imports have fallen even faster is the greater worry. Many had hoped that Chinese shoppers (and builders) would rescue the rest of the world with a voracious appetite for everything. But that seems not to be the case, at least not until the credit taps are turned back on./blockquote
bEasily Predictable/bbr /
br /
All of this was easily predictable yet most did not see this coming and fewer still still see what is ahead. For example please consider this a href=\"http://www.bloomberg.com/news/2012-05-14/china-growth-seen-at-13-year-low-by-pimco.html\" target=\"_blank\"feeble China forecast by PIMCO/a.br /
blockquote
China’s slowdown may deepen as policy makers unwind the excesses of a record credit boom while only gradually increasing stimulus, leaving 2012 growth at the weakest in 13 years, Pacific Investment Management Co. says.br /
br /
“The economy is unlikely to bottom until the third quarter,†Ramin Toloui, Pimco’s global co-head of emerging markets portfolio management in Singapore, said in e-mailed comments May 13.br /
br /
Pimco, which oversees the world’s largest bond fund, sees Chinese growth this year in the “mid-7 percent range,†a pace unseen since 1999. Its call is still lower than that of banks from Citigroup Inc. and JPMorgan Chase amp; Co. to Bank of America Corp. and UBS AG, which all pared their forecasts after April economic data were released last week./blockquote
bBottom When?/bbr /
br /
Note the feeble forecasts by Pimco, Citigroup, JP Morgan, Bank of America, and UBS.br /
br /
And what\'s with this bottom call by Pimco in the third quarter? I have to ask, third quarter of what year? 2020?br /
br /
What a bunch of collective bunk!br /
br /
I am sticking with 3.5% average growth for the rest of the decade, an idea proposed by Michael Pettis in a bet withi The Economist/i. For details, please see a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/12-predictions-by-michael-pettis-on.html\" target=\"_blank\"12 Predictions by Michael Pettis on China; Non-Food Commodity Prices Will Collapse Over Next Three to Four Years; Nails in the Hard Landing Coffin?/abr /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-2348602537997260637?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/xgsUwNVmo57LZSt_2IAkTgpy_Ws/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/xgsUwNVmo57LZSt_2IAkTgpy_Ws/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/xgsUwNVmo57LZSt_2IAkTgpy_Ws/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/xgsUwNVmo57LZSt_2IAkTgpy_Ws/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337122080;}i:18;a:21:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-3304231705367864909\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Tue, 15 May 2012 16:16:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-15T11:18:50.780-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:76:\"Mish Interview on the \"Daily Bell\": Rise of Money Metals, Why Credit Matters\";s:12:\"description#\";i:1;s:11:\"description\";s:25458:\"On Sunday, May 06, 2012 I gave an a href=\"http://www.thedailybell.com/3860/\" target=\"_blank\"Exclusive Interview to the \"Daily Bell\"/a with Anthony Wile that I would like to share with my readers.br /
br /
The Daily Bell is pleased to present this exclusive interview with Mish Shedlock. br /
br /
iibbIntroduction:/b/bnbsp;Mike \"Mish\" Shedlock blogs at Mish\'s Global Economic Trend Analysis, for which henbsp;/iihas won awards from the New York Times, Time Magazine, Bloomberg, a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"CNBC/a and Strategist News. Mishnbsp;/iiis
a contributing \"professor\" blogger at the economic and financial
education site Minyanville and offers podcasts every Thursday on
HoweStreet. He\'s a registered investment advisor representative for
SitkaPacific. He says that unlike many free-market \"Austrians,\" he
emphasizes credit impacts and deflationary trends within larger
business-cycle manifestations.nbsp;When not writing about economics, Mike
enjoys photography; 80 of his photos have become magazine and book
covers./i/ibr /
br /
bDaily Bell:/b Give us some background.br /
br /
bMish Shedlock: /bMy background is actually in computer
programming and engineering. I worked for banks for 20 years primarily
as a computer analyst working on the technical end of applications. I
was an assistant vice president for Harris Bank for most of that time.
AVP was as high a position as technicians could get. When Bank of
Montreal bought out Harris, I left to become a consultant.br /
Shortly after 9/11, contracts dried up and I was out of work for
three years with literally no income. When the economy was doing well, I
wasn\'t. My message at the time was cash is not trash and be prepared to
lose your job. Needless to say, few listened.br /
br /
I started a blog in 2005 hoping to be discovered as an economic
writer. Given there are millions of blogs the success of which are
near-zero, one might even think such a chance would be impossible since I
had no background in either economics or investing.br /
br /
However, I had some excellent teachers, primarily but not exclusively
Austrian-economic minded. A person named Heinz Blasnik from Germany
taught me a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"Austrian economic/a
fundamentals. I picked up many ideas about debt from Australian
economist Steve Keen. More recently, Michael Pettis from China taught me
nearly everything I know about trade. I blended those views into my own
model on credit.br /
br /
I received lots of help from others at numerous spots along the way.
Barry Ritholz at the Big Picture Blog promoted some of my material and
Calculated Risk created the first template for my blog.br /
br /
bDaily Bell:/b How did you get interested in investing?br /
br /
bMish Shedlock:/b Shortly before I lost my job, I
started hanging out on stock message boards. I met some pretty smart
minds on a place called Silicon Investor and I ran one of the most
popular boards on the Motley Fool.br /
br /
bDaily Bell:/b Why do people call you \"Mish\"?br /
br /
bMish Shedlock:/b Every bank I worked at formulated
user IDs out of a combination of one or two characters from first names
and six characters of last names. Thus my login to many banks where I
worked was Mishedlo. I used that name on the Motley Fool and Silicon
Investor. In stock message chat rooms, people truncated that to \"Mish.\"
I thought \"Mish\" had a nice ring to it and adopted it as my \"brand.\"br /
br /
bDaily Bell:/b Tell us about your relationship to Sitka Pacific and how it was formed.br /
br /
bMish Shedlock:/b Sitka Pacific was founded by Brian
McAuley. His background is not stocks or the economy, either. Rather,
Brian worked for a biotechnology firm. I met Brian on the Motley Fool
in early 2000. At the time he was trading for himself, then himself and
family, then friends of family. Once you get above ten, you need a
license. He got that license and decided he no longer wanted to work in
biotechnology but rather the investment community by putting their needs
first. Indeed, Sitka always puts client needs first. That does not mean
we will always be right but rather we will never do anything that puts
our interests first. I am proud of the fact that our backgrounds are not
Wall Street oriented.br /
br /
bDaily Bell:/b Tell us about Minyanville.br /
br /
bMish Shedlock:/b Shortly after I started my blog John
Succo, a Minyanville \"professor,\" asked the founder, Todd Harrison, to
post my columns. There was some concern by the Minyanville staff that I
did not have a Wall Street or hedge fund background. However,
eventually, my work stood for itself. I have always believed that being
an outsider and not having preconceived notions about money supply,
money multipliers, buy-and-hold strategies and efficient market theory
(which I think is nonsense) to be to my advantage. I was the first
industry outsider (I was not yet at Sitka) to make \"professor\" status.
The term simply means regular contributor.br /
br /
bDaily Bell:/b What is your relationship to Dollar Collapse?br /
br /
bMish Shedlock:/b Many of the ideas I write about come
from articles I read elsewhere. Dollar Collapse and Bloomberg were at
the top of the list. Currently I get many stories from iFinancial Times/i.
Also, writers from around the world send me links. \"Brisbane Bear\"
sends me stories every day from Australia. \"Bran\" sends me links every
day from Spain. I get email updates from Michael Pettis in China and
from Steen Jakobsen, the chief economist from Saxo bank in Copenhagen,
to name a few. Literally I am swamped with links from all over the
world. My goal is to make sense of the news. Sometimes I agree with
those I quote and sometimes I am very harsh. Either way, I try to add
something to the conversation, not just copy a story.br /
br /
bDaily Bell: /bHow were you able to find the time to do so much incisive writing?br /
br /
bMish Shedlock: /bWhen you are out of a job, with no
income, you have plenty of time on your hands. That is how it all
started. Now blogging and Sitka Pacific are full-time jobs. I am reading
and writing 14 hours a day on many days. However, it does not seem like
a job. Many times I am laughing my head off at what I write and hope
others do, too. One of the best compliments I ever received was when
someone asked me to please remind them to not drink coffee while reading
my blog. That request came from someone who spit coffee out his nose
trying to suppress laughter while reading my blog.br /
br /
Certainly I am not always humorous. Sometimes I am sarcastic, angry
or questioning. There is no particular slant I try for. However, my role
is always the same: to make sense out of the news in an educational way
that people can easily relate to. I am pleased the New York Times
recognized that effort, naming my blog, along with Calculated Risk and
the Big Picture, as their number one idea for the year. (See \"a href=\"http://globaleconomicanalysis.blogspot.com/2010/12/new-york-times-10th-annual-year-in.html\" target=\"_blank\"NYT 10th Annual Year in Ideas - #1 Idea of the Year \'Do-It-Yourself Macroeconomics/a.\")br /
br /
bDaily Bell:/b Do you consider yourself an Austrian in some sense?br /
br /
bMish Shedlock:/b Absolutely I am Austrian. Money
supply and credit are paramount in economic analysis. However, many
Austrians missed the mark badly by failing to consider credit. To me,
inflation is an increase in money supply and credit with credit marked
to market. Deflation is the opposite. Those who predicted massive \"price
inflation\" based on rapidly rising base money supply or M2 missed the
boat and missed it badly. Many Austrians called for treasury yields to
go to the moon. When oil hit $140 in 2008 I called for record low yields
across the entire yield curve. Most thought I was crazy. My rationale
was based on credit, the demand for more credit and the value of credit
on the balance sheets of banks. The demand for credit plunged, the value
of debt as an asset on balance sheets plunged and in response, yields
plunged.br /
br /
This set of events was very predictable but many called for
hyperinflation based on rapid increase in base money supply and the
misguided money multiplier belief that increases in money supply get
lent out ten times over. In practice, the money multiplier theory is
nonsense and the $1.5 trillion in excess reserves at the a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"Fed /aproves
it. Banks lend under three conditions, all of them required: 1) Banks
are not capital impaired. 2) Banks believe they have credit-worthy
borrowers. 3) Credit-worthy businesses and individuals want loans. If
any of those conditions fail, credit expansion goes nowhere (at best)
and is negative if defaults rise.br /
br /
Except for student loans, credit expansion has indeed gone nowhere in
this recovery. I wrote about credit expansion recently, complete with
nice charts, in my post, a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/real-consumer-credit-story-virtually-no.html\" target=\"_blank\"The Real Consumer Credit Story: Virtually No Recovery in Revolving Credit, No Recovery in Non-Revolving Credit/a.br /
br /
bDaily Bell:/b What is your position relative to Bill Still, a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"Ellen Brown/a and others who espouse public a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"central banking/a?br /
br /
bMish Shedlock:/bnbsp;Should populist Ellen Brown get her
way, I would have to rethink my US hyperinflation position. Sadly, Brown
is another one of those who understands various problems with the Fed,
but proposes a solution that is worse, putting state politicians in
charge of printing presses. When push comes to shove, the Fed would
protect the banking system. Politicians would not. Moreover, the idea
that North Dakota, a small, loosely populated farm state is in good
shape because it has a state bank is preposterous. Worse yet, Brown
takes that absurd position to the extreme, with a proposal to end the
Fed and put California politicians (state politicians in general) in
charge of printing money to support union causes. For further discussion
please see \"a href=\"http://globaleconomicanalysis.blogspot.com/2012/02/japan-announces-130-billion-qe-program.html\" target=\"_blank\"Lawmakers Threatenn to Take Over Monetary Policy/a.\"br /
br /
bDaily Bell:/b You want to end the Fed don\'t you? What would you put in its place?br /
br /
bMish Shedlock:/b One word: nothing. The free market can easily set interest rates.br /
br /
bDaily Bell:/b Do we need government bureaucrats to dictate the production or the price of cement, oranges, automobiles, computers or copper?br /
br /
bMish Shedlock:/b Anyone proposing such an insane idea
would be laughed out of the room yet we expect a bunch of academics,
with no real world experience, to do something far more difficult: set
the proper amount of money and the interest charged on it. The idea is
as ludicrous a Russian central planners setting steel production levels.
Results speak for themselves: a series of economic bubbles and
collapses with increasing amplitude in both directions. The result is a
shrinking middle class and increasing wealth concentration at the top.br /
br /
bDaily Bell:/b Does Greenbackerism lead to inflation? If not, why not?br /
br /
bMish Shedlock:/b Before there can be intelligent
discussion, one must define the terms \"Greenbackerism\" and also
\"inflation.\" Let me ask a simple question: What\'s more important to the
economy, home prices falling from $600,000 to $250,000 or the price of
steak going from $4.99 to $5.99 or gasoline from $2.50 to $4.00. People
constantly moan about the latter, but economically speaking, the plunge
in home prices is far more important. I discussed this at length in \"a href=\"http://globaleconomicanalysis.blogspot.com/2012/03/how-far-have-home-prices-really-fallen.html\" target=\"_blank\"How Far Have Home Prices \'Really\' Fallen? HPI and the CPI/a.\"br /
br /
I suspect the answer to your \"Greenbackerism\" question is, \"Yes, eventually,\" with an emphasis on ieventually/i.
It is safe to say, regardless of your definitions, that printing is
unsound and ultimately, printing money leads to bigger boom-bust cycles
or other economic distortions that crucify the middle class.br /
br /
Once again, my definition of inflation is an increase in money supply
and credit, with credit marked-to-market. Deflation is the opposite.br /
br /
Let\'s compare the practicality of my definition vs. a definition that
involves prices or a definition that involves money supply in
isolation.br /
br /
If the definition of inflation is a nominal rise in the CPI, then the
inflationists have allegedly been correct. However, treasury yields are
at record lows, home prices are at record lows, jobs have languished
and credit has stalled. Simply put, most of the things one would expect
to see in inflation have not happened. The same holds true for those who
only look at exploding base money, forever predicting the money will
multiply ten times over and treasury yields will soar.br /
br /
On the other hand, my credit-view of deflation has accurately called
for most of these things, including the rise in the price of gold and a
collapse in the value of houses. Like Humpty Dumpty, people can define
the term inflation however they want, but those who miss the boat on
credit are left wondering why the economy is not acting as generally
expected by their definition.br /
br /
Most Austrians completely missed the ramifications of collapsing
credit and the collapsing value of credit on bank balance sheets.
Similarly, virtually all Keynesians missed the boat on the housing bust.
In general terms, Keynesians missed the inevitability of a collapse
that must follow a reckless expansion of credit. Only those who focused
on credit have been properly aligned with what is actually taking place.br /
br /
bDaily Bell:/b What\'s the future for the a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"EU/a?br /
br /
bMish Shedlock: /bNo currency union in history has ever
survived without there being a fiscal union as well. Since there will
not be a fiscal union, the Eurozone must break up. The ideal way would
be for Germany and the Northern countries to exit. The painful way will
be a piecemeal exit. I expect this to be long and painful.br /
br /
bDaily Bell:/b How about China?br /
br /
bMish Shedlock:/b China is due for a \"hard landing\"
which I define as less than 3.5% growth for the rest of the decade. I
expect commodity prices will likely crash and the commodity producing
currencies such as Australia and Canada will take a big hit as well. inbsp;/ibr /
br /
iThe Economist/i
believes China will be the world\'s largest economy by 2018. I suggest
2030 may be optimistic and Chinese growth will average 3% or less for
the rest of the decade. For a discussion of the implications, please see
\"a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/12-predictions-by-michael-pettis-on.html\" target=\"_blank\"12
Predictions by Michael Pettis on China; Non-Food Commodity Prices Will
Collapse Over Next Three to Four Years; Nails in the Hard Landing
Coffin?/a\"br /
br /
bDaily Bell:/b If China goes into a meltdown, the world faces a full-scale depression. What\'s your take?br /
br /
bMish Shedlock:/b The US will actually fare relatively
well in a collapse of China. It is the trade surplus nations and
commodity produces that will take the biggest hit as noted in the
previous link.br /
br /
bDaily Bell:/b Where is the US headed?br /
br /
bMish Shedlock:/b The US is headed for recession. The
US recession will not be as bad as Europe, but corporate earnings will
sink like a rock. The a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"US dollar/a
will strengthen much to the dismay of the hyperinflationists. Then,
after Europe, China, and Japan take big hits, then and only then will
the final plunge in the US dollar occur.br /
br /
bDaily Bell:/b Where is Japan headed?br /
br /
bMish Shedlock:/b Japan is all but guaranteed to blow
up before the US. A mere rise in long-term interest rates from 1% to 2%
would consume nearly all government revenues. Ironically, I like
Japanese equities but only hedged against a plunge in the Yen. After
20-plus years of deflation, Japanese companies have almost no debt but
the currency risk is huge.br /
br /
bDaily Bell: /bAre you confident of your businesses success in the US?br /
br /
bMish Shedlock:/b If you mean me personally, yes,
pretty much so, but not overconfidently so. I am debt-free. We paid off
our mortgage this month. The key will be to catch the turn. I will not
be bearish forever.br /
br /
bDaily Bell: /bAre you thinking of traveling abroad?br /
br /
bMish Shedlock:/b Personal difficulties make overseas
travel problematic. I am now involved in a fundraiser for ALS research
(Lou Gehrig\'s Disease). My wife is in the late stages and nearly
immobile. She has been on a feeding tube for over a year and cannot eat
or drink anything, including water. So far, people from at least 22
countries have made donations. I ask everyone to please consider making a
contribution. To learn how you can help, please read \"a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/my-wife-joanne-has-als-lou-gehrigs.html\" target=\"_blank\"My Wife Joanne Has ALS, Lou Gehrig\'s Disease/a.\"br /
br /
bDaily Bell:/b What do you think of US monetary policy?br /
br /
bMish Shedlock:/b It\'s hopeless. We should get rid of
the Fed specifically and all central bankers in general. As noted
earlier, central bankers are nothing but serial bubble blowers. The
irony is they purport to be \"inflation fighters.\" In reality, central
banks are the very cause of inflation. Bernanke even wants a 2%
inflation target. Economically speaking, it\'s crazy. Eventually asset
prices and wages do not follow consumer prices and all hell breaks
loose, which is precisely where the global economy is today. I have some
nice charts of inflation targets and real disposable income in \"a href=\"http://globaleconomicanalysis.blogspot.com/2012/03/huge-problem-in-bernankes-2-inflation.html\" target=\"_blank\"Huge Problem With Bernanke\'s 2% Inflation Target Explained in Pictures/a.\"br /
br /
bDaily Bell:/b On US government statistics?br /
br /
bMish Shedlock:/b Any statistics that need to be
produced, the free market can do better and cheaper. For example, Gallup
does monthly surveys on unemployment and they do a very good job. Do we
need a mountain of highly paid government bureaucrats to gather
unemployment stats? I think not. Most do not believe the stats anyway.br /
br /
bDaily Bell:/b What\'s in the future for a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"gold and silver/a?br /
br /
bMish Shedlock:/b Gold is money. When available, the
free market has always selected gold as money. Government decree cannot
change that fact. Silver, however, has a huge industrial component.
Sometimes silver acts like money but most of the time it acts more like a
commodity plaything. Would the free market accept gold and silver as
money right now if allowed? I don\'t know but I sure would like to find
out. What sets me apart from the Prechter deflationists is my
recommendation that people hold 10-30% of their investment capital in
gold. I do not have a price target but strongly believe another big
surge is coming.br /
br /
Note that gold does not necessarily respond to movements in the US
dollar. For example, the US dollar index is near 80. The dollar index
was at 80 in late 2004 and gold was just over $400. If gold is not
responding to moves in the dollar then what is it responding to? I
suggest gold has responded to central bank efforts to revive credit. It
has also responded well to sovereign credit stress.br /
The Fed wants home prices to rise. The Fed also wants another credit
lending spree. Neither happened. Clearly, the Fed can provide liquidity
but it cannot determine where (if anywhere) liquidity goes. Since more
liquidity efforts are surely on the way, and gold is the likely
beneficiary, I highly doubt that gold has peaked. Eventually there will
be a huge currency crisis and gold will soar.br /
br /
bDaily Bell:/b Tell us more about the performance of your firm.br /
br /
bMish Shedlock: /bSitka Pacific manages portfolios that
look across asset classes in an effort to generate absolute returns
without exposing the portfolio to catastrophic drawdowns. You can find
more information including our 6-plus year performance track record at a href=\"http://www.sitkapacific.com/investment-management/\" target=\"_blank\"sitkapacific.com/a.br /
br /
bDaily Bell: /bWhat\'s your investment strategy?br /
br /
bMish Shedlock:/b Sitka Pacific is very cautious right
now. Our Absolute Return strategy currently has a position in gold, but
is otherwise essentially market neutral. Our current mission is risk
avoidance with a focus on avoiding the next big decline. We feel risk is
high and if we avoid big drawdowns we will more than make up for it by
hopping in when valuations are more attractive. To be fair, I said the
same thing over a year ago. Sometimes the market has other ideas. That\'s
why we do not use leverage, and we are never net short.br /
br /
My personal views on risk and valuations are reflected in my post, \"a href=\"http://globaleconomicanalysis.blogspot.com/2012/03/misty-water-colored-memories-dirt-cheap.html\" target=\"_blank\"Misty Water-Colored Memories, Dirt-Cheap Stocks, and Patient Opportunism/a.\"
nbsp;I also believe there is a strong likelihood of \"Negative Returns for a
Decade.\" There are numerous references in the preceding link.br /
br /
bDaily Bell:/b Do you believe there\'s a a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"power elite/a that wants to create global government?br /
br /
bMish Shedlock: /bYes. One can easily see it in Europe.
Many are angling for what I call the European \"nanny zone.\" One can
also see the idea in various a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"IMF/a Special Drawing Rights proposals.br /
br /
bDaily Bell:/b Is that a good idea?br /
br /
bMish Shedlock: /bObviously not. It will fail for the
same reasons the Euro will fail.nbsp;Europe is the big test and I think the
Eurozone splinters. Should the Eurozone actually hold together, expect
zero growth for at least a decade. Germany will take a huge hit
regardless. Either Germany provides more capital, or the Southern states
default leaving Germany holding the \"euro bag.\" Expectations that
Germany will decouple from the rest of the Eurozone are thus
nonsensical.br /
br /
bDaily Bell:/b What about this tax situation? Why the current emphasis on tax revenue?br /
br /
bMish Shedlock:/bnbsp;Hiking taxes in the midst of a global
recession is foolish at best. Europe and the US need work rule reforms
and pension reforms, not higher taxes.nbsp;I strongly support ending
collective bargaining of public unions, scrapping Davis-Bacon and all
prevailing wage laws and instituting national right-to-work laws. Many
US cities are effectively bankrupt by making pension promises that
cannot be met. Greece is bankrupt for that reason (and others) as wellbr /
.br /
Raising taxes is not the answer. So what\'s the solution? I have an eight point proposal in \"a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/public-unions-bankrupt-illinois-unpaid.html\" target=\"_blank\"Public
Unions Bankrupt Illinois: Unpaid Bills Top $9 Billion as Comptroller
Reports \'State Treading Water\'; Mish\'s Eight-Point \'Bold\' Plan to Save
Illinois/a.\"br /
br /
bDaily Bell:/b Where do you go from here?br /
br /
bMish Shedlock:/b I am thinking about writing a book on
the direction the US should take. I have lots more ideas. However, the
problem is finding the time to do it.br /
br /
bDaily Bell: /bThank you for taking time from your busy schedule for this interview, and our best wishes to you and your wife.br /
br /
bMish Shedlock: /bThank you for the invitation.div class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-3304231705367864909?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/fmdn9_bsT-nEttGWvH7kulYsJuk/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/fmdn9_bsT-nEttGWvH7kulYsJuk/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/fmdn9_bsT-nEttGWvH7kulYsJuk/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/fmdn9_bsT-nEttGWvH7kulYsJuk/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:121:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/AT-P7LxidQk/mish-in-terview-on-daily-bell-rise-of.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:93:\"http://globaleconomicanalysis.blogspot.com/2012/05/mish-in-terview-on-daily-bell-rise-of.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:25458:\"On Sunday, May 06, 2012 I gave an a href=\"http://www.thedailybell.com/3860/\" target=\"_blank\"Exclusive Interview to the \"Daily Bell\"/a with Anthony Wile that I would like to share with my readers.br /
br /
The Daily Bell is pleased to present this exclusive interview with Mish Shedlock. br /
br /
iibbIntroduction:/b/bnbsp;Mike \"Mish\" Shedlock blogs at Mish\'s Global Economic Trend Analysis, for which henbsp;/iihas won awards from the New York Times, Time Magazine, Bloomberg, a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"CNBC/a and Strategist News. Mishnbsp;/iiis
a contributing \"professor\" blogger at the economic and financial
education site Minyanville and offers podcasts every Thursday on
HoweStreet. He\'s a registered investment advisor representative for
SitkaPacific. He says that unlike many free-market \"Austrians,\" he
emphasizes credit impacts and deflationary trends within larger
business-cycle manifestations.nbsp;When not writing about economics, Mike
enjoys photography; 80 of his photos have become magazine and book
covers./i/ibr /
br /
bDaily Bell:/b Give us some background.br /
br /
bMish Shedlock: /bMy background is actually in computer
programming and engineering. I worked for banks for 20 years primarily
as a computer analyst working on the technical end of applications. I
was an assistant vice president for Harris Bank for most of that time.
AVP was as high a position as technicians could get. When Bank of
Montreal bought out Harris, I left to become a consultant.br /
Shortly after 9/11, contracts dried up and I was out of work for
three years with literally no income. When the economy was doing well, I
wasn\'t. My message at the time was cash is not trash and be prepared to
lose your job. Needless to say, few listened.br /
br /
I started a blog in 2005 hoping to be discovered as an economic
writer. Given there are millions of blogs the success of which are
near-zero, one might even think such a chance would be impossible since I
had no background in either economics or investing.br /
br /
However, I had some excellent teachers, primarily but not exclusively
Austrian-economic minded. A person named Heinz Blasnik from Germany
taught me a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"Austrian economic/a
fundamentals. I picked up many ideas about debt from Australian
economist Steve Keen. More recently, Michael Pettis from China taught me
nearly everything I know about trade. I blended those views into my own
model on credit.br /
br /
I received lots of help from others at numerous spots along the way.
Barry Ritholz at the Big Picture Blog promoted some of my material and
Calculated Risk created the first template for my blog.br /
br /
bDaily Bell:/b How did you get interested in investing?br /
br /
bMish Shedlock:/b Shortly before I lost my job, I
started hanging out on stock message boards. I met some pretty smart
minds on a place called Silicon Investor and I ran one of the most
popular boards on the Motley Fool.br /
br /
bDaily Bell:/b Why do people call you \"Mish\"?br /
br /
bMish Shedlock:/b Every bank I worked at formulated
user IDs out of a combination of one or two characters from first names
and six characters of last names. Thus my login to many banks where I
worked was Mishedlo. I used that name on the Motley Fool and Silicon
Investor. In stock message chat rooms, people truncated that to \"Mish.\"
I thought \"Mish\" had a nice ring to it and adopted it as my \"brand.\"br /
br /
bDaily Bell:/b Tell us about your relationship to Sitka Pacific and how it was formed.br /
br /
bMish Shedlock:/b Sitka Pacific was founded by Brian
McAuley. His background is not stocks or the economy, either. Rather,
Brian worked for a biotechnology firm. I met Brian on the Motley Fool
in early 2000. At the time he was trading for himself, then himself and
family, then friends of family. Once you get above ten, you need a
license. He got that license and decided he no longer wanted to work in
biotechnology but rather the investment community by putting their needs
first. Indeed, Sitka always puts client needs first. That does not mean
we will always be right but rather we will never do anything that puts
our interests first. I am proud of the fact that our backgrounds are not
Wall Street oriented.br /
br /
bDaily Bell:/b Tell us about Minyanville.br /
br /
bMish Shedlock:/b Shortly after I started my blog John
Succo, a Minyanville \"professor,\" asked the founder, Todd Harrison, to
post my columns. There was some concern by the Minyanville staff that I
did not have a Wall Street or hedge fund background. However,
eventually, my work stood for itself. I have always believed that being
an outsider and not having preconceived notions about money supply,
money multipliers, buy-and-hold strategies and efficient market theory
(which I think is nonsense) to be to my advantage. I was the first
industry outsider (I was not yet at Sitka) to make \"professor\" status.
The term simply means regular contributor.br /
br /
bDaily Bell:/b What is your relationship to Dollar Collapse?br /
br /
bMish Shedlock:/b Many of the ideas I write about come
from articles I read elsewhere. Dollar Collapse and Bloomberg were at
the top of the list. Currently I get many stories from iFinancial Times/i.
Also, writers from around the world send me links. \"Brisbane Bear\"
sends me stories every day from Australia. \"Bran\" sends me links every
day from Spain. I get email updates from Michael Pettis in China and
from Steen Jakobsen, the chief economist from Saxo bank in Copenhagen,
to name a few. Literally I am swamped with links from all over the
world. My goal is to make sense of the news. Sometimes I agree with
those I quote and sometimes I am very harsh. Either way, I try to add
something to the conversation, not just copy a story.br /
br /
bDaily Bell: /bHow were you able to find the time to do so much incisive writing?br /
br /
bMish Shedlock: /bWhen you are out of a job, with no
income, you have plenty of time on your hands. That is how it all
started. Now blogging and Sitka Pacific are full-time jobs. I am reading
and writing 14 hours a day on many days. However, it does not seem like
a job. Many times I am laughing my head off at what I write and hope
others do, too. One of the best compliments I ever received was when
someone asked me to please remind them to not drink coffee while reading
my blog. That request came from someone who spit coffee out his nose
trying to suppress laughter while reading my blog.br /
br /
Certainly I am not always humorous. Sometimes I am sarcastic, angry
or questioning. There is no particular slant I try for. However, my role
is always the same: to make sense out of the news in an educational way
that people can easily relate to. I am pleased the New York Times
recognized that effort, naming my blog, along with Calculated Risk and
the Big Picture, as their number one idea for the year. (See \"a href=\"http://globaleconomicanalysis.blogspot.com/2010/12/new-york-times-10th-annual-year-in.html\" target=\"_blank\"NYT 10th Annual Year in Ideas - #1 Idea of the Year \'Do-It-Yourself Macroeconomics/a.\")br /
br /
bDaily Bell:/b Do you consider yourself an Austrian in some sense?br /
br /
bMish Shedlock:/b Absolutely I am Austrian. Money
supply and credit are paramount in economic analysis. However, many
Austrians missed the mark badly by failing to consider credit. To me,
inflation is an increase in money supply and credit with credit marked
to market. Deflation is the opposite. Those who predicted massive \"price
inflation\" based on rapidly rising base money supply or M2 missed the
boat and missed it badly. Many Austrians called for treasury yields to
go to the moon. When oil hit $140 in 2008 I called for record low yields
across the entire yield curve. Most thought I was crazy. My rationale
was based on credit, the demand for more credit and the value of credit
on the balance sheets of banks. The demand for credit plunged, the value
of debt as an asset on balance sheets plunged and in response, yields
plunged.br /
br /
This set of events was very predictable but many called for
hyperinflation based on rapid increase in base money supply and the
misguided money multiplier belief that increases in money supply get
lent out ten times over. In practice, the money multiplier theory is
nonsense and the $1.5 trillion in excess reserves at the a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"Fed /aproves
it. Banks lend under three conditions, all of them required: 1) Banks
are not capital impaired. 2) Banks believe they have credit-worthy
borrowers. 3) Credit-worthy businesses and individuals want loans. If
any of those conditions fail, credit expansion goes nowhere (at best)
and is negative if defaults rise.br /
br /
Except for student loans, credit expansion has indeed gone nowhere in
this recovery. I wrote about credit expansion recently, complete with
nice charts, in my post, a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/real-consumer-credit-story-virtually-no.html\" target=\"_blank\"The Real Consumer Credit Story: Virtually No Recovery in Revolving Credit, No Recovery in Non-Revolving Credit/a.br /
br /
bDaily Bell:/b What is your position relative to Bill Still, a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"Ellen Brown/a and others who espouse public a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"central banking/a?br /
br /
bMish Shedlock:/bnbsp;Should populist Ellen Brown get her
way, I would have to rethink my US hyperinflation position. Sadly, Brown
is another one of those who understands various problems with the Fed,
but proposes a solution that is worse, putting state politicians in
charge of printing presses. When push comes to shove, the Fed would
protect the banking system. Politicians would not. Moreover, the idea
that North Dakota, a small, loosely populated farm state is in good
shape because it has a state bank is preposterous. Worse yet, Brown
takes that absurd position to the extreme, with a proposal to end the
Fed and put California politicians (state politicians in general) in
charge of printing money to support union causes. For further discussion
please see \"a href=\"http://globaleconomicanalysis.blogspot.com/2012/02/japan-announces-130-billion-qe-program.html\" target=\"_blank\"Lawmakers Threatenn to Take Over Monetary Policy/a.\"br /
br /
bDaily Bell:/b You want to end the Fed don\'t you? What would you put in its place?br /
br /
bMish Shedlock:/b One word: nothing. The free market can easily set interest rates.br /
br /
bDaily Bell:/b Do we need government bureaucrats to dictate the production or the price of cement, oranges, automobiles, computers or copper?br /
br /
bMish Shedlock:/b Anyone proposing such an insane idea
would be laughed out of the room yet we expect a bunch of academics,
with no real world experience, to do something far more difficult: set
the proper amount of money and the interest charged on it. The idea is
as ludicrous a Russian central planners setting steel production levels.
Results speak for themselves: a series of economic bubbles and
collapses with increasing amplitude in both directions. The result is a
shrinking middle class and increasing wealth concentration at the top.br /
br /
bDaily Bell:/b Does Greenbackerism lead to inflation? If not, why not?br /
br /
bMish Shedlock:/b Before there can be intelligent
discussion, one must define the terms \"Greenbackerism\" and also
\"inflation.\" Let me ask a simple question: What\'s more important to the
economy, home prices falling from $600,000 to $250,000 or the price of
steak going from $4.99 to $5.99 or gasoline from $2.50 to $4.00. People
constantly moan about the latter, but economically speaking, the plunge
in home prices is far more important. I discussed this at length in \"a href=\"http://globaleconomicanalysis.blogspot.com/2012/03/how-far-have-home-prices-really-fallen.html\" target=\"_blank\"How Far Have Home Prices \'Really\' Fallen? HPI and the CPI/a.\"br /
br /
I suspect the answer to your \"Greenbackerism\" question is, \"Yes, eventually,\" with an emphasis on ieventually/i.
It is safe to say, regardless of your definitions, that printing is
unsound and ultimately, printing money leads to bigger boom-bust cycles
or other economic distortions that crucify the middle class.br /
br /
Once again, my definition of inflation is an increase in money supply
and credit, with credit marked-to-market. Deflation is the opposite.br /
br /
Let\'s compare the practicality of my definition vs. a definition that
involves prices or a definition that involves money supply in
isolation.br /
br /
If the definition of inflation is a nominal rise in the CPI, then the
inflationists have allegedly been correct. However, treasury yields are
at record lows, home prices are at record lows, jobs have languished
and credit has stalled. Simply put, most of the things one would expect
to see in inflation have not happened. The same holds true for those who
only look at exploding base money, forever predicting the money will
multiply ten times over and treasury yields will soar.br /
br /
On the other hand, my credit-view of deflation has accurately called
for most of these things, including the rise in the price of gold and a
collapse in the value of houses. Like Humpty Dumpty, people can define
the term inflation however they want, but those who miss the boat on
credit are left wondering why the economy is not acting as generally
expected by their definition.br /
br /
Most Austrians completely missed the ramifications of collapsing
credit and the collapsing value of credit on bank balance sheets.
Similarly, virtually all Keynesians missed the boat on the housing bust.
In general terms, Keynesians missed the inevitability of a collapse
that must follow a reckless expansion of credit. Only those who focused
on credit have been properly aligned with what is actually taking place.br /
br /
bDaily Bell:/b What\'s the future for the a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"EU/a?br /
br /
bMish Shedlock: /bNo currency union in history has ever
survived without there being a fiscal union as well. Since there will
not be a fiscal union, the Eurozone must break up. The ideal way would
be for Germany and the Northern countries to exit. The painful way will
be a piecemeal exit. I expect this to be long and painful.br /
br /
bDaily Bell:/b How about China?br /
br /
bMish Shedlock:/b China is due for a \"hard landing\"
which I define as less than 3.5% growth for the rest of the decade. I
expect commodity prices will likely crash and the commodity producing
currencies such as Australia and Canada will take a big hit as well. inbsp;/ibr /
br /
iThe Economist/i
believes China will be the world\'s largest economy by 2018. I suggest
2030 may be optimistic and Chinese growth will average 3% or less for
the rest of the decade. For a discussion of the implications, please see
\"a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/12-predictions-by-michael-pettis-on.html\" target=\"_blank\"12
Predictions by Michael Pettis on China; Non-Food Commodity Prices Will
Collapse Over Next Three to Four Years; Nails in the Hard Landing
Coffin?/a\"br /
br /
bDaily Bell:/b If China goes into a meltdown, the world faces a full-scale depression. What\'s your take?br /
br /
bMish Shedlock:/b The US will actually fare relatively
well in a collapse of China. It is the trade surplus nations and
commodity produces that will take the biggest hit as noted in the
previous link.br /
br /
bDaily Bell:/b Where is the US headed?br /
br /
bMish Shedlock:/b The US is headed for recession. The
US recession will not be as bad as Europe, but corporate earnings will
sink like a rock. The a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"US dollar/a
will strengthen much to the dismay of the hyperinflationists. Then,
after Europe, China, and Japan take big hits, then and only then will
the final plunge in the US dollar occur.br /
br /
bDaily Bell:/b Where is Japan headed?br /
br /
bMish Shedlock:/b Japan is all but guaranteed to blow
up before the US. A mere rise in long-term interest rates from 1% to 2%
would consume nearly all government revenues. Ironically, I like
Japanese equities but only hedged against a plunge in the Yen. After
20-plus years of deflation, Japanese companies have almost no debt but
the currency risk is huge.br /
br /
bDaily Bell: /bAre you confident of your businesses success in the US?br /
br /
bMish Shedlock:/b If you mean me personally, yes,
pretty much so, but not overconfidently so. I am debt-free. We paid off
our mortgage this month. The key will be to catch the turn. I will not
be bearish forever.br /
br /
bDaily Bell: /bAre you thinking of traveling abroad?br /
br /
bMish Shedlock:/b Personal difficulties make overseas
travel problematic. I am now involved in a fundraiser for ALS research
(Lou Gehrig\'s Disease). My wife is in the late stages and nearly
immobile. She has been on a feeding tube for over a year and cannot eat
or drink anything, including water. So far, people from at least 22
countries have made donations. I ask everyone to please consider making a
contribution. To learn how you can help, please read \"a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/my-wife-joanne-has-als-lou-gehrigs.html\" target=\"_blank\"My Wife Joanne Has ALS, Lou Gehrig\'s Disease/a.\"br /
br /
bDaily Bell:/b What do you think of US monetary policy?br /
br /
bMish Shedlock:/b It\'s hopeless. We should get rid of
the Fed specifically and all central bankers in general. As noted
earlier, central bankers are nothing but serial bubble blowers. The
irony is they purport to be \"inflation fighters.\" In reality, central
banks are the very cause of inflation. Bernanke even wants a 2%
inflation target. Economically speaking, it\'s crazy. Eventually asset
prices and wages do not follow consumer prices and all hell breaks
loose, which is precisely where the global economy is today. I have some
nice charts of inflation targets and real disposable income in \"a href=\"http://globaleconomicanalysis.blogspot.com/2012/03/huge-problem-in-bernankes-2-inflation.html\" target=\"_blank\"Huge Problem With Bernanke\'s 2% Inflation Target Explained in Pictures/a.\"br /
br /
bDaily Bell:/b On US government statistics?br /
br /
bMish Shedlock:/b Any statistics that need to be
produced, the free market can do better and cheaper. For example, Gallup
does monthly surveys on unemployment and they do a very good job. Do we
need a mountain of highly paid government bureaucrats to gather
unemployment stats? I think not. Most do not believe the stats anyway.br /
br /
bDaily Bell:/b What\'s in the future for a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"gold and silver/a?br /
br /
bMish Shedlock:/b Gold is money. When available, the
free market has always selected gold as money. Government decree cannot
change that fact. Silver, however, has a huge industrial component.
Sometimes silver acts like money but most of the time it acts more like a
commodity plaything. Would the free market accept gold and silver as
money right now if allowed? I don\'t know but I sure would like to find
out. What sets me apart from the Prechter deflationists is my
recommendation that people hold 10-30% of their investment capital in
gold. I do not have a price target but strongly believe another big
surge is coming.br /
br /
Note that gold does not necessarily respond to movements in the US
dollar. For example, the US dollar index is near 80. The dollar index
was at 80 in late 2004 and gold was just over $400. If gold is not
responding to moves in the dollar then what is it responding to? I
suggest gold has responded to central bank efforts to revive credit. It
has also responded well to sovereign credit stress.br /
The Fed wants home prices to rise. The Fed also wants another credit
lending spree. Neither happened. Clearly, the Fed can provide liquidity
but it cannot determine where (if anywhere) liquidity goes. Since more
liquidity efforts are surely on the way, and gold is the likely
beneficiary, I highly doubt that gold has peaked. Eventually there will
be a huge currency crisis and gold will soar.br /
br /
bDaily Bell:/b Tell us more about the performance of your firm.br /
br /
bMish Shedlock: /bSitka Pacific manages portfolios that
look across asset classes in an effort to generate absolute returns
without exposing the portfolio to catastrophic drawdowns. You can find
more information including our 6-plus year performance track record at a href=\"http://www.sitkapacific.com/investment-management/\" target=\"_blank\"sitkapacific.com/a.br /
br /
bDaily Bell: /bWhat\'s your investment strategy?br /
br /
bMish Shedlock:/b Sitka Pacific is very cautious right
now. Our Absolute Return strategy currently has a position in gold, but
is otherwise essentially market neutral. Our current mission is risk
avoidance with a focus on avoiding the next big decline. We feel risk is
high and if we avoid big drawdowns we will more than make up for it by
hopping in when valuations are more attractive. To be fair, I said the
same thing over a year ago. Sometimes the market has other ideas. That\'s
why we do not use leverage, and we are never net short.br /
br /
My personal views on risk and valuations are reflected in my post, \"a href=\"http://globaleconomicanalysis.blogspot.com/2012/03/misty-water-colored-memories-dirt-cheap.html\" target=\"_blank\"Misty Water-Colored Memories, Dirt-Cheap Stocks, and Patient Opportunism/a.\"
nbsp;I also believe there is a strong likelihood of \"Negative Returns for a
Decade.\" There are numerous references in the preceding link.br /
br /
bDaily Bell:/b Do you believe there\'s a a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"power elite/a that wants to create global government?br /
br /
bMish Shedlock: /bYes. One can easily see it in Europe.
Many are angling for what I call the European \"nanny zone.\" One can
also see the idea in various a href=\"http://beta.blogger.com/blogger.g?blogID=11295626\" style=\"color: #009900;\"IMF/a Special Drawing Rights proposals.br /
br /
bDaily Bell:/b Is that a good idea?br /
br /
bMish Shedlock: /bObviously not. It will fail for the
same reasons the Euro will fail.nbsp;Europe is the big test and I think the
Eurozone splinters. Should the Eurozone actually hold together, expect
zero growth for at least a decade. Germany will take a huge hit
regardless. Either Germany provides more capital, or the Southern states
default leaving Germany holding the \"euro bag.\" Expectations that
Germany will decouple from the rest of the Eurozone are thus
nonsensical.br /
br /
bDaily Bell:/b What about this tax situation? Why the current emphasis on tax revenue?br /
br /
bMish Shedlock:/bnbsp;Hiking taxes in the midst of a global
recession is foolish at best. Europe and the US need work rule reforms
and pension reforms, not higher taxes.nbsp;I strongly support ending
collective bargaining of public unions, scrapping Davis-Bacon and all
prevailing wage laws and instituting national right-to-work laws. Many
US cities are effectively bankrupt by making pension promises that
cannot be met. Greece is bankrupt for that reason (and others) as wellbr /
.br /
Raising taxes is not the answer. So what\'s the solution? I have an eight point proposal in \"a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/public-unions-bankrupt-illinois-unpaid.html\" target=\"_blank\"Public
Unions Bankrupt Illinois: Unpaid Bills Top $9 Billion as Comptroller
Reports \'State Treading Water\'; Mish\'s Eight-Point \'Bold\' Plan to Save
Illinois/a.\"br /
br /
bDaily Bell:/b Where do you go from here?br /
br /
bMish Shedlock:/b I am thinking about writing a book on
the direction the US should take. I have lots more ideas. However, the
problem is finding the time to do it.br /
br /
bDaily Bell: /bThank you for taking time from your busy schedule for this interview, and our best wishes to you and your wife.br /
br /
bMish Shedlock: /bThank you for the invitation.div class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-3304231705367864909?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/fmdn9_bsT-nEttGWvH7kulYsJuk/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/fmdn9_bsT-nEttGWvH7kulYsJuk/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/fmdn9_bsT-nEttGWvH7kulYsJuk/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/fmdn9_bsT-nEttGWvH7kulYsJuk/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337098560;}i:19;a:21:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-5238221684984374707\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Tue, 15 May 2012 05:28:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-18T01:01:01.084-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:74:\"ALS Update; I Still Need Your Help; Money Contributions From 22 Countries!\";s:12:\"description#\";i:1;s:11:\"description\";s:6174:\"In case you missed it, back on April 2, 2012 I reported a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/my-wife-joanne-has-als-lou-gehrigs.html\" target=\"_blank\"My Wife Joanne Has ALS, Lou Gehrig\'s Disease/a.br /
br /
In that post, I announced I was running a raffle for the benefit of the iLes Turner ALS Foundation/i. Please read the post if you have not yet seen it.br /
br /
Many people have asked for an update, so here goes.br /
br /
Raffle ticket purchases and contributions have come in from 22 countries around the world.br /
br /
bCountries Making Donations/bbr /
br /
ol
liAustralia/li
liBelgiumnbsp;/li
liCanadanbsp;/li
liChile/li
liChina /li
liEstonianbsp;/li
liFrancenbsp;/li
liGermanynbsp;/li
liIrelandnbsp;/li
liJapannbsp;/li
liLuxembourgnbsp;/li
liMexico /li
liNetherlandsnbsp;/li
liNew Zealandnbsp;/li
liNorwaynbsp;/li
liPanamanbsp;/li
liSingaporenbsp;/li
liSouth Africanbsp;/li
liSpainnbsp;/li
liSwedennbsp;/li
liSwitzerlandnbsp;/li
liUnited Kingdom
/li
/ol
br /
Approximately $209,000 has been raised so far of which $9,000 has been cash contributions, not raffle ticket purchases.br /
br /
In addition, two corporate sponsors have kicked in $10,000 each. Sitka Pacific was a corporate sponsor (half mine) and a href=\"http://www.goldmoney.com/fight-als.html?gmrefcode=MishALS\" target=\"_blank\"GoldMoney/a was a corporate sponsor.br /
br /
Given half of raffle ticket proceeds go to raffle winners, and half to the Les Turner ALS foundation, the approximate total raised for ALS research is about $130,000.br /
br /
The Les Turner ALS foundation is thrilled with those results, but I am disappointed. I have about 46,000 subscribers to my blog feed, but a mere 997 raffle tickets have been sold as of Sunday.br /
br /
I never expected to sell the allotted number of 30,000 raffle tickets, but the state of Illinois required us to pick a number so I purposely picked a high one. However, I did hope to raise $1 million in lottery tickets, half going to ALS research.br /
br /
br /
Over the years many people have asked me to put up a tip
jar. I refused. I have always thought the best information is free. That
philosophy has served me well. I have never asked for anything, but I
am asking now.br /
br /
If information from this blog, for free,
4-5 posts a day (for 7 years!) has made you money or kept you out of
trouble, then please consider purchasing a raffle ticket or making a
donation.br /
br /
If times are tough, and they may very well be, then please consider a cash donation of $10 or more. Every bit helps.br /
br /
bChecks/bbr /
br /
To make a cash donation by check or money order, please send a check or money order tobr /
Lacey Woodnbsp; br /
Mish Campaignbr /
Les Turner ALS Foundationbr /
5550 W. Touhy Avenue, Suite 302
Skokie, IL 60077br /
847.679.3311 (Main)br /
Any questions, please call the above number.br /
br /
bCredit Card/bbr /
br /
You can make a donation or purchase raffle tickets by credit card on the a href=\"https://www.kintera.org/site/apps/ka/rg/ecreg.asp?c=7oJDLNPxFkJWGamp;b=8032591amp;en=ddJQJMPkHcKAKFMqEiLDKFPqGlISIRMhG5KCIPMxHhLOLYNoH7IFIMNsFkJIIHOrErE\" target=\"_blank\"raffle site/a.br /
br /
Some
people did not like entering the information fields required, however,
the purpose is only to ensure the foundation knows how to get in touch
with raffle winners.br /
br /
People move, phone numbers change, and email addresses change. It\'s as simple as that.br /
br /
Those who do not like disclosing personal information on a form (the site is secure)
can send a check or money order for tickets or to make a donation.br /
br /
bCorporate Sponsors/bbr /
br /
I am also disappointed in lack of response from corporate sponsors. Where is Google? Apple? Sony? I emailed all three.br /
br /
So a big tip of the hat tonbsp; a href=\"http://www.goldmoney.com/fight-als.html?gmrefcode=MishALS\" target=\"_blank\"GoldMoney/a for stepping up to the plate.br /
br /
If you wish to buy a raffle ticket or make a donation, please click on this link toa href=\"https://www.kintera.org/site/apps/ka/rg/ecreg.asp?c=7oJDLNPxFkJWGamp;b=8032591amp;en=bjISJ3MDLfISKYODIcJSL1PELbJTIgOPJaJNJ1MNKqIZKdNWKhJOJ7NNLgISI9NVIsI9E\" target=\"_blank\" Support the Les Turner ALS Foundation/a.br /
br /
Thanksbr /
Mishbr /
br /
bAddendum:/bbr /
br /
Counting the US there are 23 countries nowbr /
br /
As of Thursday 5-17-2012 the updated total is $273,759br /
br /
ul
liDonations $14,931 /li
liTickets $236,800/li
liCorporate Sponsorships $20,000 /li
/ul
br /
Les Turner gets half of ticket sales so the direct benefit to Les Turner so far is $154,331br /
br /
Some people did not like entering the information fields on the a href=\"https://www.kintera.org/site/apps/ka/rg/ecreg.asp?c=7oJDLNPxFkJWGamp;b=8032591amp;en=ddJQJMPkHcKAKFMqEiLDKFPqGlISIRMhG5KCIPMxHhLOLYNoH7IFIMNsFkJIIHOrErE\" target=\"_blank\"raffle site/a. The purpose is only to ensure the foundation knows how to get in touch with raffle winners. People move, phone numbers change, and email addresses change. It\'s as simple as that.br /
br /
Those who do not like disclosing personal information on a form (the site is secure) can send a check or money order for tickets or to make a donation.br /
br /
Thanksbr /
Mishdiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-5238221684984374707?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/KIytzk737zWO4epoArknWAETZrk/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/KIytzk737zWO4epoArknWAETZrk/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/KIytzk737zWO4epoArknWAETZrk/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/KIytzk737zWO4epoArknWAETZrk/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:122:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/LSG-T1zn8Z8/als-update-money-contributions-from-22.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:94:\"http://globaleconomicanalysis.blogspot.com/2012/05/als-update-money-contributions-from-22.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:6174:\"In case you missed it, back on April 2, 2012 I reported a href=\"http://globaleconomicanalysis.blogspot.com/2012/04/my-wife-joanne-has-als-lou-gehrigs.html\" target=\"_blank\"My Wife Joanne Has ALS, Lou Gehrig\'s Disease/a.br /
br /
In that post, I announced I was running a raffle for the benefit of the iLes Turner ALS Foundation/i. Please read the post if you have not yet seen it.br /
br /
Many people have asked for an update, so here goes.br /
br /
Raffle ticket purchases and contributions have come in from 22 countries around the world.br /
br /
bCountries Making Donations/bbr /
br /
ol
liAustralia/li
liBelgiumnbsp;/li
liCanadanbsp;/li
liChile/li
liChina /li
liEstonianbsp;/li
liFrancenbsp;/li
liGermanynbsp;/li
liIrelandnbsp;/li
liJapannbsp;/li
liLuxembourgnbsp;/li
liMexico /li
liNetherlandsnbsp;/li
liNew Zealandnbsp;/li
liNorwaynbsp;/li
liPanamanbsp;/li
liSingaporenbsp;/li
liSouth Africanbsp;/li
liSpainnbsp;/li
liSwedennbsp;/li
liSwitzerlandnbsp;/li
liUnited Kingdom
/li
/ol
br /
Approximately $209,000 has been raised so far of which $9,000 has been cash contributions, not raffle ticket purchases.br /
br /
In addition, two corporate sponsors have kicked in $10,000 each. Sitka Pacific was a corporate sponsor (half mine) and a href=\"http://www.goldmoney.com/fight-als.html?gmrefcode=MishALS\" target=\"_blank\"GoldMoney/a was a corporate sponsor.br /
br /
Given half of raffle ticket proceeds go to raffle winners, and half to the Les Turner ALS foundation, the approximate total raised for ALS research is about $130,000.br /
br /
The Les Turner ALS foundation is thrilled with those results, but I am disappointed. I have about 46,000 subscribers to my blog feed, but a mere 997 raffle tickets have been sold as of Sunday.br /
br /
I never expected to sell the allotted number of 30,000 raffle tickets, but the state of Illinois required us to pick a number so I purposely picked a high one. However, I did hope to raise $1 million in lottery tickets, half going to ALS research.br /
br /
br /
Over the years many people have asked me to put up a tip
jar. I refused. I have always thought the best information is free. That
philosophy has served me well. I have never asked for anything, but I
am asking now.br /
br /
If information from this blog, for free,
4-5 posts a day (for 7 years!) has made you money or kept you out of
trouble, then please consider purchasing a raffle ticket or making a
donation.br /
br /
If times are tough, and they may very well be, then please consider a cash donation of $10 or more. Every bit helps.br /
br /
bChecks/bbr /
br /
To make a cash donation by check or money order, please send a check or money order tobr /
Lacey Woodnbsp; br /
Mish Campaignbr /
Les Turner ALS Foundationbr /
5550 W. Touhy Avenue, Suite 302
Skokie, IL 60077br /
847.679.3311 (Main)br /
Any questions, please call the above number.br /
br /
bCredit Card/bbr /
br /
You can make a donation or purchase raffle tickets by credit card on the a href=\"https://www.kintera.org/site/apps/ka/rg/ecreg.asp?c=7oJDLNPxFkJWGamp;b=8032591amp;en=ddJQJMPkHcKAKFMqEiLDKFPqGlISIRMhG5KCIPMxHhLOLYNoH7IFIMNsFkJIIHOrErE\" target=\"_blank\"raffle site/a.br /
br /
Some
people did not like entering the information fields required, however,
the purpose is only to ensure the foundation knows how to get in touch
with raffle winners.br /
br /
People move, phone numbers change, and email addresses change. It\'s as simple as that.br /
br /
Those who do not like disclosing personal information on a form (the site is secure)
can send a check or money order for tickets or to make a donation.br /
br /
bCorporate Sponsors/bbr /
br /
I am also disappointed in lack of response from corporate sponsors. Where is Google? Apple? Sony? I emailed all three.br /
br /
So a big tip of the hat tonbsp; a href=\"http://www.goldmoney.com/fight-als.html?gmrefcode=MishALS\" target=\"_blank\"GoldMoney/a for stepping up to the plate.br /
br /
If you wish to buy a raffle ticket or make a donation, please click on this link toa href=\"https://www.kintera.org/site/apps/ka/rg/ecreg.asp?c=7oJDLNPxFkJWGamp;b=8032591amp;en=bjISJ3MDLfISKYODIcJSL1PELbJTIgOPJaJNJ1MNKqIZKdNWKhJOJ7NNLgISI9NVIsI9E\" target=\"_blank\" Support the Les Turner ALS Foundation/a.br /
br /
Thanksbr /
Mishbr /
br /
bAddendum:/bbr /
br /
Counting the US there are 23 countries nowbr /
br /
As of Thursday 5-17-2012 the updated total is $273,759br /
br /
ul
liDonations $14,931 /li
liTickets $236,800/li
liCorporate Sponsorships $20,000 /li
/ul
br /
Les Turner gets half of ticket sales so the direct benefit to Les Turner so far is $154,331br /
br /
Some people did not like entering the information fields on the a href=\"https://www.kintera.org/site/apps/ka/rg/ecreg.asp?c=7oJDLNPxFkJWGamp;b=8032591amp;en=ddJQJMPkHcKAKFMqEiLDKFPqGlISIRMhG5KCIPMxHhLOLYNoH7IFIMNsFkJIIHOrErE\" target=\"_blank\"raffle site/a. The purpose is only to ensure the foundation knows how to get in touch with raffle winners. People move, phone numbers change, and email addresses change. It\'s as simple as that.br /
br /
Those who do not like disclosing personal information on a form (the site is secure) can send a check or money order for tickets or to make a donation.br /
br /
Thanksbr /
Mishdiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-5238221684984374707?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/KIytzk737zWO4epoArknWAETZrk/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/KIytzk737zWO4epoArknWAETZrk/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/KIytzk737zWO4epoArknWAETZrk/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/KIytzk737zWO4epoArknWAETZrk/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337059680;}i:20;a:21:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-3146903232188472201\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Mon, 14 May 2012 23:42:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-14T18:49:46.435-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:220:\"Mr. \"Lie When It\'s Serious\" Juncker Tells Another Whopper: \"I Don’t Envisage, Not Even for One Second, Greece Leaving the Euro Area\"; Two More Days of Hopefully Futile Coalition Talks on a \"Government of Personalities\"\";s:12:\"description#\";i:1;s:11:\"description\";s:5416:\"Those looking for a bit of humor in the European debacle can find it in statements from Jean-Claude Juncker, head of the eurozone finance ministers.br /
br /
Juncker says \"I don’t envisage, not even for one second, Greece leaving the euro area. This is nonsense. This is propaganda. We have to respect Greek democracy.\"br /
br /
Bear in mind this statement comes from the same man who said \"When it becomes serious, you have to lie.\" br /
br /
Also bear in mind Juncker\'s support for a Troika installed puppet government in Greece, after Greek Prime Minister George Papandreou proposed putting bailout measures to a vote.br /
br /
Notice that bailout measures went to a vote anyway.br /
br /
bTwo More Days of Hopefully Futile Greek Negotiations/bbr /
br /
The Financial Times reports a href=\"http://www.ft.com/intl/cms/s/0/9911a498-9dba-11e1-9a9e-00144feabdc0.html#axzz1ut97nkvM\" target=\"_blank\"Greece set for further coalition talks/abr /
blockquote
Greece’s president is set to resume coalition talks on Tuesday with the country’s political leaders in another attempt to avoid a fresh general election after a meeting on Monday evening ended without agreement. br /
br /
President Karolos Papoulias has another 48 hours to persuade politicians to join a national unity government according to the constitution or face having to call another election.br /
br /
Mr Venizelos said after the meeting he had supported the president’s proposal for a “government of personalities†with backing “from as many political parties as possible†to implement further reforms agreed in return for a second €174bn bailout.br /
br /
“The situation is very difficult and I’m not optimistic, but we must try every possible solution,†Mr Venizelos said.br /
br /
Alexis Tsipras, the leader of Syriza, the radical leftwing coalition that rejects the terms of Greece’s international bailout, refused to participate in Monday’s talks. “We’re not going to join in selective meetings of political leaders ... The circle of contacts provided for by the constitution has been completed,†he said.br /
br /
Jean-Claude Juncker, the Luxembourg prime minister who heads the group of eurozone finance ministers, sharply criticised other EU leaders for “threatening†Greece with expulsion from the single currency, saying the will of Greek voters must be respected.br /
br /
“I don’t envisage, not even for one second, Greece leaving the euro area. This is nonsense. This is propaganda,†Mr Juncker said angrily at a news conference. “We have to respect Greek democracy.â€br /
br /
He added he would be open to debating easing terms of the €174bn bailout, including extending dates to hit fiscal and economic reform targets by a year, something that has been anathema to several leaders in Germany, the European Central Bank and the European Commission.br /
br /
Maria Fekter, the outspoken Austrian finance minister, went so far as to suggest Greece may have to leave the EU, since there is no legal provision for leaving the euro without exiting the union.br /
br /
“Greece would have to reapply and then we would have membership negotiations and look very closely whether Greece would be able to become a member at all,†said Ms Fekter. “We look much more closely than when they joined the euro.â€make full repayment on the bond, which was issued under UK law, to avoid future legal action by holdout investors, the official said. /blockquote
bLies Everywhere/bbr /
br /
Junker\'s statement about willingness to negotiate changes in bailout terms is of course a blatant lie aimed at keeping Greece in the Eurozone.br /
br /
Also note the lie fromnbsp; Maria Fekter about Greece having to leave the EU if it exits the eurozone. Given that numerous countries are in the EU without being in the Eurozone, the UK is a prime example, Fekter\'s statement is complete nonsense.br /
br /
That said, perhaps Greece is better of not being in the EU as well. Certainly the UK would be better off telling the EU where to go.br /
br /
\"When it becomes serious, you have to lie.\" br /
br /
Indeed Juncker and and others have proven lies are the norm.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-3146903232188472201?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/cnRkCovqm_Ek2QeTqTjUHYLV_G0/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/cnRkCovqm_Ek2QeTqTjUHYLV_G0/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/cnRkCovqm_Ek2QeTqTjUHYLV_G0/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/cnRkCovqm_Ek2QeTqTjUHYLV_G0/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:121:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/1NZEPUs7sp8/mr-lie-when-its-serious-juncker-tells.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:93:\"http://globaleconomicanalysis.blogspot.com/2012/05/mr-lie-when-its-serious-juncker-tells.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:5416:\"Those looking for a bit of humor in the European debacle can find it in statements from Jean-Claude Juncker, head of the eurozone finance ministers.br /
br /
Juncker says \"I don’t envisage, not even for one second, Greece leaving the euro area. This is nonsense. This is propaganda. We have to respect Greek democracy.\"br /
br /
Bear in mind this statement comes from the same man who said \"When it becomes serious, you have to lie.\" br /
br /
Also bear in mind Juncker\'s support for a Troika installed puppet government in Greece, after Greek Prime Minister George Papandreou proposed putting bailout measures to a vote.br /
br /
Notice that bailout measures went to a vote anyway.br /
br /
bTwo More Days of Hopefully Futile Greek Negotiations/bbr /
br /
The Financial Times reports a href=\"http://www.ft.com/intl/cms/s/0/9911a498-9dba-11e1-9a9e-00144feabdc0.html#axzz1ut97nkvM\" target=\"_blank\"Greece set for further coalition talks/abr /
blockquote
Greece’s president is set to resume coalition talks on Tuesday with the country’s political leaders in another attempt to avoid a fresh general election after a meeting on Monday evening ended without agreement. br /
br /
President Karolos Papoulias has another 48 hours to persuade politicians to join a national unity government according to the constitution or face having to call another election.br /
br /
Mr Venizelos said after the meeting he had supported the president’s proposal for a “government of personalities†with backing “from as many political parties as possible†to implement further reforms agreed in return for a second €174bn bailout.br /
br /
“The situation is very difficult and I’m not optimistic, but we must try every possible solution,†Mr Venizelos said.br /
br /
Alexis Tsipras, the leader of Syriza, the radical leftwing coalition that rejects the terms of Greece’s international bailout, refused to participate in Monday’s talks. “We’re not going to join in selective meetings of political leaders ... The circle of contacts provided for by the constitution has been completed,†he said.br /
br /
Jean-Claude Juncker, the Luxembourg prime minister who heads the group of eurozone finance ministers, sharply criticised other EU leaders for “threatening†Greece with expulsion from the single currency, saying the will of Greek voters must be respected.br /
br /
“I don’t envisage, not even for one second, Greece leaving the euro area. This is nonsense. This is propaganda,†Mr Juncker said angrily at a news conference. “We have to respect Greek democracy.â€br /
br /
He added he would be open to debating easing terms of the €174bn bailout, including extending dates to hit fiscal and economic reform targets by a year, something that has been anathema to several leaders in Germany, the European Central Bank and the European Commission.br /
br /
Maria Fekter, the outspoken Austrian finance minister, went so far as to suggest Greece may have to leave the EU, since there is no legal provision for leaving the euro without exiting the union.br /
br /
“Greece would have to reapply and then we would have membership negotiations and look very closely whether Greece would be able to become a member at all,†said Ms Fekter. “We look much more closely than when they joined the euro.â€make full repayment on the bond, which was issued under UK law, to avoid future legal action by holdout investors, the official said. /blockquote
bLies Everywhere/bbr /
br /
Junker\'s statement about willingness to negotiate changes in bailout terms is of course a blatant lie aimed at keeping Greece in the Eurozone.br /
br /
Also note the lie fromnbsp; Maria Fekter about Greece having to leave the EU if it exits the eurozone. Given that numerous countries are in the EU without being in the Eurozone, the UK is a prime example, Fekter\'s statement is complete nonsense.br /
br /
That said, perhaps Greece is better of not being in the EU as well. Certainly the UK would be better off telling the EU where to go.br /
br /
\"When it becomes serious, you have to lie.\" br /
br /
Indeed Juncker and and others have proven lies are the norm.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-3146903232188472201?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/cnRkCovqm_Ek2QeTqTjUHYLV_G0/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/cnRkCovqm_Ek2QeTqTjUHYLV_G0/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/cnRkCovqm_Ek2QeTqTjUHYLV_G0/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/cnRkCovqm_Ek2QeTqTjUHYLV_G0/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337038920;}i:21;a:22:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-7410734376529696559\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Mon, 14 May 2012 21:31:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-14T16:33:22.268-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:73:\"200,000 Lose Unemployment Benefits This Week, Nearly Half From California\";s:12:\"description#\";i:1;s:11:\"description\";s:4668:\"The grim situation in California is about to get grimmer as a target=\"_blank\" href=\"http://money.cnn.com/2012/05/11/news/economy/jobless-unemployment-benefits/index.htm?hpt=hp_t1\"Unemployment Benefits Go Bye-Bye/ablockquote
More than 200,000 long-term jobless Americans will lose their unemployment checks this week, when eight states roll off the federal extended benefits program.br /
br /
Nearly half of them live in California, and the rest reside in Florida, Illinois, North Carolina, Colorado, Connecticut, Pennsylvania and Texas.br /
br /
The federal extended benefits program has provided the jobless with up to 20 weeks of unemployment checks after they\'ve run through their state and their federal emergency benefits, which together last up to 79 weeks.br /
br /
But the extended benefits program is expiring throughout the country as the economy improves. To be eligible for these benefits, a state must show that its unemployment rate is at least 10% higher than it was in at least one of the past three years.br /
br /
Already, 25 states have rolled off the extended benefits program, with 15 of them exiting last month alone. But more unemployed folks will be affected by this week\'s cessation than April\'s, when about 135,000 people saw their payments end.br /
br /
The jobless have been able to collect up to 99 weeks of benefits for much of the Great Recession and its aftermath. But after multiple extensions, Congress in February passed a law that starts phasing out this unprecedented lifeline.br /
br /
Starting later this year, the maximum number of weeks the jobless can collect unemployment benefits will be reduced to as little as 40 weeks in states with jobless rates below 6% and to as many as 73 weeks where unemployment tops 9%. /blockquote
bLong Term Unemployed/bbr /
br /
a target=\"_blank\" href=\"http://1.bp.blogspot.com/-t5k82M-WSNA/T7F0Bu3DtVI/AAAAAAAAPKQ/-stzKbyRTdQ/s1600/Long%2Bterm%2Bunemployed.png\" imageanchor=\"1\"img border=\"0\" height=\"240\" src=\"http://1.bp.blogspot.com/-t5k82M-WSNA/T7F0Bu3DtVI/AAAAAAAAPKQ/-stzKbyRTdQ/s400/Long%2Bterm%2Bunemployed.png\" width=\"400\" //abr /
br /
The chart shows a drop of about 1.5 million off the long-term unemployment rolls. Yet, about 5.1 million are still long-term unemployed.br /
br /
Moreover the numbers are probably much worse than they look as some of that drop is a result of fraudulent disability claims. For details please see a target=\"_blank\" href=\"http://globaleconomicanalysis.blogspot.com/2012/05/trimtabs-on-debt-and-disability-claims.html\"TrimTabs on Debt and Disability Claims: How Much Debt Does it Take to Generate $1 in GDP? Disability Fraud vs. Expiring Unemployment Benefits Revisited/a.br /
br /
Given a total of 335,000 have lost or about to lose unemployment benefits, I expect to see another jump in fraudulent disability claims. Those of retirement age might also select \"forced retirement\" in order to collect social security benefits.br /
br /
As noted above, California bears the brunt of this wave of benefit expulsions, and that will exacerbate the state\'s fiscal problems. For details, please see a target=\"_blank\" href=\"http://globaleconomicanalysis.blogspot.com/2012/05/california-deficit-soared-to-16-billion.html\"California Deficit Soars to $16 billion; Governor Brown Threatens Public Education Unless He Gets \"Temporary\" Tax hikes; How Brown Ruined California in His First Term; Four Point Solution/a.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-7410734376529696559?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/Qu3glJ4eEj0qVjOZ2tUgI2vmhTk/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/Qu3glJ4eEj0qVjOZ2tUgI2vmhTk/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/Qu3glJ4eEj0qVjOZ2tUgI2vmhTk/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/Qu3glJ4eEj0qVjOZ2tUgI2vmhTk/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:122:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/P9RXCba4xEI/200000-lose-unemployment-benefits-this.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:5:\"media\";a:6:{s:10:\"thumbnail#\";i:1;s:10:\"thumbnail@\";s:28:\"xmlns:media,url,height,width\";s:21:\"thumbnail@xmlns:media\";s:29:\"http://search.yahoo.com/mrss/\";s:13:\"thumbnail@url\";s:108:\"http://1.bp.blogspot.com/-t5k82M-WSNA/T7F0Bu3DtVI/AAAAAAAAPKQ/-stzKbyRTdQ/s72-c/Long%2Bterm%2Bunemployed.png\";s:16:\"thumbnail@height\";s:2:\"72\";s:15:\"thumbnail@width\";s:2:\"72\";}s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:94:\"http://globaleconomicanalysis.blogspot.com/2012/05/200000-lose-unemployment-benefits-this.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:4668:\"The grim situation in California is about to get grimmer as a target=\"_blank\" href=\"http://money.cnn.com/2012/05/11/news/economy/jobless-unemployment-benefits/index.htm?hpt=hp_t1\"Unemployment Benefits Go Bye-Bye/ablockquote
More than 200,000 long-term jobless Americans will lose their unemployment checks this week, when eight states roll off the federal extended benefits program.br /
br /
Nearly half of them live in California, and the rest reside in Florida, Illinois, North Carolina, Colorado, Connecticut, Pennsylvania and Texas.br /
br /
The federal extended benefits program has provided the jobless with up to 20 weeks of unemployment checks after they\'ve run through their state and their federal emergency benefits, which together last up to 79 weeks.br /
br /
But the extended benefits program is expiring throughout the country as the economy improves. To be eligible for these benefits, a state must show that its unemployment rate is at least 10% higher than it was in at least one of the past three years.br /
br /
Already, 25 states have rolled off the extended benefits program, with 15 of them exiting last month alone. But more unemployed folks will be affected by this week\'s cessation than April\'s, when about 135,000 people saw their payments end.br /
br /
The jobless have been able to collect up to 99 weeks of benefits for much of the Great Recession and its aftermath. But after multiple extensions, Congress in February passed a law that starts phasing out this unprecedented lifeline.br /
br /
Starting later this year, the maximum number of weeks the jobless can collect unemployment benefits will be reduced to as little as 40 weeks in states with jobless rates below 6% and to as many as 73 weeks where unemployment tops 9%. /blockquote
bLong Term Unemployed/bbr /
br /
a target=\"_blank\" href=\"http://1.bp.blogspot.com/-t5k82M-WSNA/T7F0Bu3DtVI/AAAAAAAAPKQ/-stzKbyRTdQ/s1600/Long%2Bterm%2Bunemployed.png\" imageanchor=\"1\"img border=\"0\" height=\"240\" src=\"http://1.bp.blogspot.com/-t5k82M-WSNA/T7F0Bu3DtVI/AAAAAAAAPKQ/-stzKbyRTdQ/s400/Long%2Bterm%2Bunemployed.png\" width=\"400\" //abr /
br /
The chart shows a drop of about 1.5 million off the long-term unemployment rolls. Yet, about 5.1 million are still long-term unemployed.br /
br /
Moreover the numbers are probably much worse than they look as some of that drop is a result of fraudulent disability claims. For details please see a target=\"_blank\" href=\"http://globaleconomicanalysis.blogspot.com/2012/05/trimtabs-on-debt-and-disability-claims.html\"TrimTabs on Debt and Disability Claims: How Much Debt Does it Take to Generate $1 in GDP? Disability Fraud vs. Expiring Unemployment Benefits Revisited/a.br /
br /
Given a total of 335,000 have lost or about to lose unemployment benefits, I expect to see another jump in fraudulent disability claims. Those of retirement age might also select \"forced retirement\" in order to collect social security benefits.br /
br /
As noted above, California bears the brunt of this wave of benefit expulsions, and that will exacerbate the state\'s fiscal problems. For details, please see a target=\"_blank\" href=\"http://globaleconomicanalysis.blogspot.com/2012/05/california-deficit-soared-to-16-billion.html\"California Deficit Soars to $16 billion; Governor Brown Threatens Public Education Unless He Gets \"Temporary\" Tax hikes; How Brown Ruined California in His First Term; Four Point Solution/a.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-7410734376529696559?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/Qu3glJ4eEj0qVjOZ2tUgI2vmhTk/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/Qu3glJ4eEj0qVjOZ2tUgI2vmhTk/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/Qu3glJ4eEj0qVjOZ2tUgI2vmhTk/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/Qu3glJ4eEj0qVjOZ2tUgI2vmhTk/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337031060;}i:22;a:22:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-5077530053745243246\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Mon, 14 May 2012 16:04:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-14T11:04:55.430-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:107:\"No Deal: Greek Moderate Left Party says \"No Government Possible\"; Chart Explains Why Deal Is Now Impossible\";s:12:\"description#\";i:1;s:11:\"description\";s:4296:\"The talks still continue but good news is on the horizon as yet another political party, the Democratic Left, has backed out of the Unity coalition.br /
br /
Please consider a target=\"_blank\" href=\"http://www.bbc.co.uk/news/world-europe-18055629\"Greece\'s moderate left says no government possible/abr /
blockquote
The moderate Democratic Left party in Greece says it will not join pro-bailout parties in a coalition without the more radical far-left Syriza.br /
br /
Syriza is refusing to attend coalition talks because it will not back any government which supports austerity measures demanded by the EU and IMF.br /
br /
The Greek president has summoned the four main parties for last-ditch talks in an effort to avoid new elections.br /
br /
\"No unity government can emerge,\" Fotis Kouvelis, head of the Democratic Left party, told Greek television.br /
br /
\"A government without Syriza would not have the necessary popular and parliamentary backing.\" /blockquote
bChart Explains Why Deal Is Now Impossible/bbr /
br /
Here is a nice chart from the article that highlights the situation. Annotations in purple by Me.br /
br /
a target=\"_blank\" href=\"http://4.bp.blogspot.com/-VAlL5RxxdEA/T7EqFjbyBDI/AAAAAAAAPJ8/eZjCNfA30CA/s1600/300%2BSeats.png\" imageanchor=\"1\"img border=\"0\" height=\"230\" src=\"http://4.bp.blogspot.com/-VAlL5RxxdEA/T7EqFjbyBDI/AAAAAAAAPJ8/eZjCNfA30CA/s400/300%2BSeats.png\" width=\"400\" //abr /
br /
The Independent Greeks are willing to form a coalition, however please note a target=\"_blank\" href=\"http://online.wsj.com/article/BT-CO-20120513-700853.html\"7 Conditions For Coalition Government/ablockquote
The head of Greece\'s nationalist Independent Greeks party Sunday set seven conditions--including annulment of the country\'s loan deal--for his party\'s participation in a coalition government, even as Greece scrambles to resolve a weeklong political deadlock following inconclusive polls last week.br /
br /
Speaking less than an hour after a meeting with Greece\'s president, Panos Kammenos said any coalition partners would also have to agree to immediately expand the country\'s exclusive economic zone, set up a special committee to re-examine the size of Greece\'s official debt--which Kammenos disputes--and press the case of German war reparations from the World War II, among other things.br /
br /
\"The president of the republic said he would share our proposals with the heads of the other parties,\" Kammenos said. \"If these seven proposals are accepted, at that point we will see if a coalition government is possible with the other parties.\"br /
br /
Kammenos, who polled fourth in last Sunday\'s elections and won 10.6% of the vote, reaffirmed his opposition to the loan memorandum and the austerity measures associated with it. /blockquote
bTwo Votes Short/bbr /
br /
Those conditions leave the Unity coalition two vote short of a majority. Unless a couple of elected representatives switch parties, a new vote will take place. It is highly likely Syriza will get enough votes from the left to form a government.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-5077530053745243246?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/YghAs7zulRJZLXQioD1nCUTe8s0/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/YghAs7zulRJZLXQioD1nCUTe8s0/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/YghAs7zulRJZLXQioD1nCUTe8s0/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/YghAs7zulRJZLXQioD1nCUTe8s0/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:122:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/F68BoiUfTWA/no-deal-greek-moderate-left-party-says.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:5:\"media\";a:6:{s:10:\"thumbnail#\";i:1;s:10:\"thumbnail@\";s:28:\"xmlns:media,url,height,width\";s:21:\"thumbnail@xmlns:media\";s:29:\"http://search.yahoo.com/mrss/\";s:13:\"thumbnail@url\";s:95:\"http://4.bp.blogspot.com/-VAlL5RxxdEA/T7EqFjbyBDI/AAAAAAAAPJ8/eZjCNfA30CA/s72-c/300%2BSeats.png\";s:16:\"thumbnail@height\";s:2:\"72\";s:15:\"thumbnail@width\";s:2:\"72\";}s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:94:\"http://globaleconomicanalysis.blogspot.com/2012/05/no-deal-greek-moderate-left-party-says.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:4296:\"The talks still continue but good news is on the horizon as yet another political party, the Democratic Left, has backed out of the Unity coalition.br /
br /
Please consider a target=\"_blank\" href=\"http://www.bbc.co.uk/news/world-europe-18055629\"Greece\'s moderate left says no government possible/abr /
blockquote
The moderate Democratic Left party in Greece says it will not join pro-bailout parties in a coalition without the more radical far-left Syriza.br /
br /
Syriza is refusing to attend coalition talks because it will not back any government which supports austerity measures demanded by the EU and IMF.br /
br /
The Greek president has summoned the four main parties for last-ditch talks in an effort to avoid new elections.br /
br /
\"No unity government can emerge,\" Fotis Kouvelis, head of the Democratic Left party, told Greek television.br /
br /
\"A government without Syriza would not have the necessary popular and parliamentary backing.\" /blockquote
bChart Explains Why Deal Is Now Impossible/bbr /
br /
Here is a nice chart from the article that highlights the situation. Annotations in purple by Me.br /
br /
a target=\"_blank\" href=\"http://4.bp.blogspot.com/-VAlL5RxxdEA/T7EqFjbyBDI/AAAAAAAAPJ8/eZjCNfA30CA/s1600/300%2BSeats.png\" imageanchor=\"1\"img border=\"0\" height=\"230\" src=\"http://4.bp.blogspot.com/-VAlL5RxxdEA/T7EqFjbyBDI/AAAAAAAAPJ8/eZjCNfA30CA/s400/300%2BSeats.png\" width=\"400\" //abr /
br /
The Independent Greeks are willing to form a coalition, however please note a target=\"_blank\" href=\"http://online.wsj.com/article/BT-CO-20120513-700853.html\"7 Conditions For Coalition Government/ablockquote
The head of Greece\'s nationalist Independent Greeks party Sunday set seven conditions--including annulment of the country\'s loan deal--for his party\'s participation in a coalition government, even as Greece scrambles to resolve a weeklong political deadlock following inconclusive polls last week.br /
br /
Speaking less than an hour after a meeting with Greece\'s president, Panos Kammenos said any coalition partners would also have to agree to immediately expand the country\'s exclusive economic zone, set up a special committee to re-examine the size of Greece\'s official debt--which Kammenos disputes--and press the case of German war reparations from the World War II, among other things.br /
br /
\"The president of the republic said he would share our proposals with the heads of the other parties,\" Kammenos said. \"If these seven proposals are accepted, at that point we will see if a coalition government is possible with the other parties.\"br /
br /
Kammenos, who polled fourth in last Sunday\'s elections and won 10.6% of the vote, reaffirmed his opposition to the loan memorandum and the austerity measures associated with it. /blockquote
bTwo Votes Short/bbr /
br /
Those conditions leave the Unity coalition two vote short of a majority. Unless a couple of elected representatives switch parties, a new vote will take place. It is highly likely Syriza will get enough votes from the left to form a government.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-5077530053745243246?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/YghAs7zulRJZLXQioD1nCUTe8s0/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/YghAs7zulRJZLXQioD1nCUTe8s0/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/YghAs7zulRJZLXQioD1nCUTe8s0/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/YghAs7zulRJZLXQioD1nCUTe8s0/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337011440;}i:23;a:21:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-8273852786258444472\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Mon, 14 May 2012 14:58:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-14T10:07:25.485-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:159:\"Five European Central Bankers Discuss Greek Eurozone Exit; Lies and Half-Truths from German Finance Minister; Message to Greek Politicians \"No New Concessions\"\";s:12:\"description#\";i:1;s:11:\"description\";s:5029:\"A small dose of reality has set in for a group of European central bankers: a href=\"http://www.bloomberg.com/news/2012-05-13/euro-officials-begin-to-weigh-greek-exit-from-common-currency.html\" target=\"_blank\"Euro Officials Begin to Weigh Greek Exit as Euro Weakens/a.br /
blockquote
Greece’s possible exit from the euro moved to the center of Europe’s financial-crisis debate, rattling markets as authorities in Athens struggled to form a government.br /
br /
Meetings brokered by Greek President Karolos Papoulias were set to continue today after Syriza, the leading anti-bailout party, rejected a unity government following inconclusive elections May 6. That moved the country closer to a new vote, with at least five European central bankers broaching the once-taboo topic of its exit from the euro.br /
br /
Euro finance ministers meeting today in Brussels may discuss the bailout for Greece, as well as the situation in Spain, where the government last week made a fourth attempt to clean up banks. Getting German Chancellor Angela Merkel to weaken her demand that debt cutting be the core of the crisis response will be a key objective of new French President Francois Hollande when the two meet tomorrow in Berlin.br /
br /
The euro fell for the 10th day in 11, weakening 0.4 percent to $1.2872 at noon in Brussels, the lowest in three months.br /
br /
bNo New Concessions/bbr /
br /
The euro finance ministers, known collectively as the eurogroup, will convene in Brussels at 5 p.m. local time.br /
br /
The European Commission isn’t considering easing the terms of the joint bailout for Greece from the EU and the International Monetary Fund, EU spokesman Amadeu Altafaj said, denying a report by Athens-based Real News. /blockquote
bMessage to Greek Politicians \"No New Concessions\"/bbr /
br /
Greek Unity-Clown proponents Evangelos Venizelos, leader of Pasok party, and Antonis Samaras, leader of the centre-right New Democracy party, keep promoting the idea of a \"Unity\" government that will renegotiate the terms of the bailout. Clearly they are liars.br /
br /
If the eurocrats, Germany, and IMF were to agree to negotiate new terms, that would be now, not after Greece kisses the Troika\'s ass with a \"Unity Pledge\".br /
br /
Given the statement from the EU on concessions,nbsp; Syriza party leader Alexis Tsipras would be a fool to agree to a \"Unity\" government. Actually, he would be a fool anyway because no one can possibly believe meaningful concessions are coming, promised or not.br /
br /
bLies and Half-Truths from German Finance Minister/bbr /
br /
German finance minister a href=\"http://www.bloomberg.com/news/2012-05-14/schaeuble-says-if-greeks-had-own-currency-it-would-devalue.html\" target=\"_blank\"Schaeuble Says If Greeks Had Own Currency It Would Devalue/a.br /
br /
The devaluation claim is certainly true enough, but it is also obvious.br /
br /
Here is Schaeuble\'s blatant lie: \"The advantages for the Greeks [to stay in the eurozone] are greater, but it will be strenuous\".br /
br /
Chancellor Angela Merkel will host French President Francois Hollande in Berlin tomorrow after his election on a platform of a switch away from the chancellor’s focus on austerity. Hollande wants to reopen the European Union’s budget treaty to include measures to spur economic growth.br /
br /
“I think Hollande knows that the fiscal pact can’t be renegotiated,†Schaeuble said. br /
br /
That is a lie as well and we will find out soon enough. Given the a href=\"http://globaleconomicanalysis.blogspot.com/2012/05/crushing-defeat-for-merkels-cdu-party.html\" target=\"_blank\"Crushing Defeat for Merkel\'s CDU Party in German Elections/a last weekend, Hollande will press even harder for what he wants: Eurobonds and a weakening of austerity measures.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-8273852786258444472?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/hf9WZdFt3DwPKIhWTFqS1Cz84c4/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/hf9WZdFt3DwPKIhWTFqS1Cz84c4/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/hf9WZdFt3DwPKIhWTFqS1Cz84c4/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/hf9WZdFt3DwPKIhWTFqS1Cz84c4/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:121:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/HuqF8pWWzRc/five-european-central-bankers-discuss.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:93:\"http://globaleconomicanalysis.blogspot.com/2012/05/five-european-central-bankers-discuss.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:5029:\"A small dose of reality has set in for a group of European central bankers: a href=\"http://www.bloomberg.com/news/2012-05-13/euro-officials-begin-to-weigh-greek-exit-from-common-currency.html\" target=\"_blank\"Euro Officials Begin to Weigh Greek Exit as Euro Weakens/a.br /
blockquote
Greece’s possible exit from the euro moved to the center of Europe’s financial-crisis debate, rattling markets as authorities in Athens struggled to form a government.br /
br /
Meetings brokered by Greek President Karolos Papoulias were set to continue today after Syriza, the leading anti-bailout party, rejected a unity government following inconclusive elections May 6. That moved the country closer to a new vote, with at least five European central bankers broaching the once-taboo topic of its exit from the euro.br /
br /
Euro finance ministers meeting today in Brussels may discuss the bailout for Greece, as well as the situation in Spain, where the government last week made a fourth attempt to clean up banks. Getting German Chancellor Angela Merkel to weaken her demand that debt cutting be the core of the crisis response will be a key objective of new French President Francois Hollande when the two meet tomorrow in Berlin.br /
br /
The euro fell for the 10th day in 11, weakening 0.4 percent to $1.2872 at noon in Brussels, the lowest in three months.br /
br /
bNo New Concessions/bbr /
br /
The euro finance ministers, known collectively as the eurogroup, will convene in Brussels at 5 p.m. local time.br /
br /
The European Commission isn’t considering easing the terms of the joint bailout for Greece from the EU and the International Monetary Fund, EU spokesman Amadeu Altafaj said, denying a report by Athens-based Real News. /blockquote
bMessage to Greek Politicians \"No New Concessions\"/bbr /
br /
Greek Unity-Clown proponents Evangelos Venizelos, leader of Pasok party, and Antonis Samaras, leader of the centre-right New Democracy party, keep promoting the idea of a \"Unity\" government that will renegotiate the terms of the bailout. Clearly they are liars.br /
br /
If the eurocrats, Germany, and IMF were to agree to negotiate new terms, that would be now, not after Greece kisses the Troika\'s ass with a \"Unity Pledge\".br /
br /
Given the statement from the EU on concessions,nbsp; Syriza party leader Alexis Tsipras would be a fool to agree to a \"Unity\" government. Actually, he would be a fool anyway because no one can possibly believe meaningful concessions are coming, promised or not.br /
br /
bLies and Half-Truths from German Finance Minister/bbr /
br /
German finance minister a href=\"http://www.bloomberg.com/news/2012-05-14/schaeuble-says-if-greeks-had-own-currency-it-would-devalue.html\" target=\"_blank\"Schaeuble Says If Greeks Had Own Currency It Would Devalue/a.br /
br /
The devaluation claim is certainly true enough, but it is also obvious.br /
br /
Here is Schaeuble\'s blatant lie: \"The advantages for the Greeks [to stay in the eurozone] are greater, but it will be strenuous\".br /
br /
Chancellor Angela Merkel will host French President Francois Hollande in Berlin tomorrow after his election on a platform of a switch away from the chancellor’s focus on austerity. Hollande wants to reopen the European Union’s budget treaty to include measures to spur economic growth.br /
br /
“I think Hollande knows that the fiscal pact can’t be renegotiated,†Schaeuble said. br /
br /
That is a lie as well and we will find out soon enough. Given the a href=\"http://globaleconomicanalysis.blogspot.com/2012/05/crushing-defeat-for-merkels-cdu-party.html\" target=\"_blank\"Crushing Defeat for Merkel\'s CDU Party in German Elections/a last weekend, Hollande will press even harder for what he wants: Eurobonds and a weakening of austerity measures.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-8273852786258444472?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/hf9WZdFt3DwPKIhWTFqS1Cz84c4/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/hf9WZdFt3DwPKIhWTFqS1Cz84c4/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/hf9WZdFt3DwPKIhWTFqS1Cz84c4/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/hf9WZdFt3DwPKIhWTFqS1Cz84c4/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:7:\"content\";N;s:14:\"date_timestamp\";i:1337007480;}i:24;a:21:{s:5:\"guid#\";i:1;s:5:\"guid@\";s:11:\"ispermalink\";s:16:\"guid@ispermalink\";s:5:\"false\";s:4:\"guid\";s:59:\"tag:blogger.com,1999:blog-11324386.post-2310004552676258275\";s:8:\"pubdate#\";i:1;s:7:\"pubdate\";s:31:\"Mon, 14 May 2012 13:57:00 +0000\";s:4:\"atom\";a:2:{s:8:\"updated#\";i:1;s:7:\"updated\";s:29:\"2012-05-14T10:21:51.205-05:00\";}s:6:\"title#\";i:1;s:5:\"title\";s:187:\"California Deficit Soars to $16 billion; Governor Brown Threatens Public Education Unless He Gets \"Temporary\" Tax hikes; How Brown Ruined California in His First Term; Four Point Solution\";s:12:\"description#\";i:1;s:11:\"description\";s:7285:\"California, like Greece is perpetually in fiscal trouble. Overoptimistic revenue forecasts coupled with spending $2 billion more than expected has California in a deep hole. Governor Jerry Brown has the same non-solution as ever, hike taxes.br /
br /
Brown wants a \"temporary\" (as in seven years) tax hike. Given we all know there are no such things as temporary tax hikes in California (seven years is permanent enough in the first place), and also given the California school budget needs an axe, I say let him.br /
br /
Please consider a href=\"http://latimesblogs.latimes.com/california-politics/2012/05/california-budget-jerry-brown.html\" target=\"_blank\"California deficit has soared to $16 billion, Gov. Jerry Brown says/a
br /
blockquote
Gov. Jerry Brown announced on Saturday that the state\'s deficit has ballooned to $16 billion, a huge increase over his $9.2-billion estimate in January.br /
br /
Lawmakers and others were hoping that a rebounding economy would help the state avoid steep cuts to social services. But revenue in April, the most important month of the year for income taxes, fell far short of expectations, leading to a shortfall of at least $3 billion in the current fiscal year.br /
br /
The state has also spent $2.1 billion more than expected, according to the controller, further worsening California\'s financial health.br /
br /
Advocates involved in budget discussions say they expect deeper cuts to social services than Brown originally proposed in January. Union officials are also in negotiations with administration officials about ways to reduce state payroll costs, an issue that wasn\'t on the table earlier this year.br /
br /
Brown has said there will be even deeper cuts, mostly to public education, if voters do not improve tax hikes in November. He is seeking a quarter-cent increase in the state sales tax for four years and a seven-year hike on incomes of $250,000 or more that will range from 1 to 3 percentage points. He says the measure would raise $9 billion in the upcoming budget year./blockquote
bTax Hikes, Public Unions, and Union Sympathizers Hand-in-Hand/bbr /
br /
Whenever tax hikes are on the table, union supporters are at the front of the line demanding them.br /
br /
Yahoo!News has additional details in a href=\"http://news.yahoo.com/california-facing-higher-16-billion-shortfall-213905732--finance.html\"California facing higher $16 billion shortfall/abr /
blockquote
Under Brown\'s tax plan, California would temporarily raise the state\'s sales tax by a quarter-cent and increase the income tax on people who make $250,000 or more. Brown is projecting his tax initiative would raise as much as $9 billion, but a review by the nonpartisan analyst\'s office estimates revenue of $6.8 billion in fiscal year 2012-13.br /
br /
Supporters of the \"Schools and Local Public Safety Protection Act of 2012\" say the additional revenue would help maintain current funding levels for public schools and colleges and pay for programs that benefit seniors and low-income families. It also would provide local governments with a constitutional guarantee of funding to comply with a new state law that shifts lower-level offenders from state prisons to county jails.br /
br /
A second tax hike headed for the November ballot is being promoted by Los Angeles civil rights attorney Molly Munger, whose initiative would raise income taxes on a sliding scale for nearly all wage-earners to help fund schools.br /
br /
Anti-tax groups and Republican lawmakers say both tax increases will hurt California\'s economic recovery. State GOP Chairman Tom Del Beccaro has embarked on a statewide campaign to discuss alternatives to Brown\'s tax hikes.br /
br /
The governor is expected to propose a contingency plan with a list of unpopular cuts that would kick in automatically if voters reject tax hikes this fall. In January, he said they would result in a K-12 school year shortened by up to three weeks, higher college tuition fees and reduced funding for courts./blockquote
Expect to hear Armageddon chants from public unions immediately if not sooner.br /
br /
bHow Brown Ruined California in His First Term/bbr /
br /
Bear in mind that Governor Brown helped ruin California with public union collective bargaining rights in his first stint as governor, in the 70\'s.br /
br /
ul
liThe a href=\"http://www.perb.ca.gov/laws/eera.asp\" target=\"_blank\"Educational Employment Relations Act/a of 1976, established collective bargaining in California\'s public schools and community colleges/li
liThe a href=\"http://www.perb.ca.gov/laws/dills.asp\" target=\"_blank\"Ralph C. Dills Act/a of 1978 established collective bargaining for state government employees/li
liThe a href=\"http://www.perb.ca.gov/laws/dills.asp\" target=\"_blank\"Higher Education Employer-Employee Relations Act/a of 1979, extended collective bargainingnbsp;to the state university system. /li
/ul
br /
California schools and taxpayers are perpetually in the hole because of Brown\'s idiocy decades ago.br /
br /
bFour Point Solution/bbr /
br /
Fixing the problem is easy to describe, but hard to implement given all the union sympathizers who want to further wreck the state.br /
br /
ol
liCalifornia needs to end collective bargaining of public unions/li
liCalifornia needs to claw back promised pension benefits/li
liCalifornia needs to end all defined benefit plans for public employees/li
liCalifornia needs to scrap prevailing wage laws that have crucified cities/li
/ol
br /
Raising taxes will just cause the exodus of more corporations and highly salaried workers as noted in a href=\"http://globaleconomicanalysis.blogspot.com/2012/03/california-tax-revenues-plunge.html\"California Tax Revenues Plunge; Businesses Exit \"Taxifornia\" in Droves; Piecing Together the Jobs-Picture Puzzle/abr /
br /
bTaxed to Death/bbr /
br /
If Brown continues to suck up to the public unions responsible for the
mess California is in, expect still more businesses to leave, expect the
unemployment rate to rise, and expect a continued plunge in revenue.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-2310004552676258275?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
pa href=\"http://feedads.g.doubleclick.net/~a/eEbbtbAOOq2nH4oUNUkMCs_WgXs/0/da\"img src=\"http://feedads.g.doubleclick.net/~a/eEbbtbAOOq2nH4oUNUkMCs_WgXs/0/di\" border=\"0\" ismap=\"true\"/img/abr/
a href=\"http://feedads.g.doubleclick.net/~a/eEbbtbAOOq2nH4oUNUkMCs_WgXs/1/da\"img src=\"http://feedads.g.doubleclick.net/~a/eEbbtbAOOq2nH4oUNUkMCs_WgXs/1/di\" border=\"0\" ismap=\"true\"/img/a/p\";s:5:\"link#\";i:1;s:4:\"link\";s:123:\"http://feedproxy.google.com/~r/MishsGlobalEconomicTrendAnalysis/~3/5uRX7uWCaNU/california-deficit-soared-to-16-billion.html\";s:7:\"author#\";i:1;s:6:\"author\";s:40:\"noreply@blogger.com (Mike Mish Shedlock)\";s:3:\"thr\";a:2:{s:6:\"total#\";i:1;s:5:\"total\";s:1:\"0\";}s:10:\"feedburner\";a:2:{s:9:\"origlink#\";i:1;s:8:\"origlink\";s:95:\"http://globaleconomicanalysis.blogspot.com/2012/05/california-deficit-soared-to-16-billion.html\";}s:8:\"summary#\";i:1;s:7:\"summary\";s:7285:\"California, like Greece is perpetually in fiscal trouble. Overoptimistic revenue forecasts coupled with spending $2 billion more than expected has California in a deep hole. Governor Jerry Brown has the same non-solution as ever, hike taxes.br /
br /
Brown wants a \"temporary\" (as in seven years) tax hike. Given we all know there are no such things as temporary tax hikes in California (seven years is permanent enough in the first place), and also given the California school budget needs an axe, I say let him.br /
br /
Please consider a href=\"http://latimesblogs.latimes.com/california-politics/2012/05/california-budget-jerry-brown.html\" target=\"_blank\"California deficit has soared to $16 billion, Gov. Jerry Brown says/a
br /
blockquote
Gov. Jerry Brown announced on Saturday that the state\'s deficit has ballooned to $16 billion, a huge increase over his $9.2-billion estimate in January.br /
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Lawmakers and others were hoping that a rebounding economy would help the state avoid steep cuts to social services. But revenue in April, the most important month of the year for income taxes, fell far short of expectations, leading to a shortfall of at least $3 billion in the current fiscal year.br /
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The state has also spent $2.1 billion more than expected, according to the controller, further worsening California\'s financial health.br /
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Advocates involved in budget discussions say they expect deeper cuts to social services than Brown originally proposed in January. Union officials are also in negotiations with administration officials about ways to reduce state payroll costs, an issue that wasn\'t on the table earlier this year.br /
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Brown has said there will be even deeper cuts, mostly to public education, if voters do not improve tax hikes in November. He is seeking a quarter-cent increase in the state sales tax for four years and a seven-year hike on incomes of $250,000 or more that will range from 1 to 3 percentage points. He says the measure would raise $9 billion in the upcoming budget year./blockquote
bTax Hikes, Public Unions, and Union Sympathizers Hand-in-Hand/bbr /
br /
Whenever tax hikes are on the table, union supporters are at the front of the line demanding them.br /
br /
Yahoo!News has additional details in a href=\"http://news.yahoo.com/california-facing-higher-16-billion-shortfall-213905732--finance.html\"California facing higher $16 billion shortfall/abr /
blockquote
Under Brown\'s tax plan, California would temporarily raise the state\'s sales tax by a quarter-cent and increase the income tax on people who make $250,000 or more. Brown is projecting his tax initiative would raise as much as $9 billion, but a review by the nonpartisan analyst\'s office estimates revenue of $6.8 billion in fiscal year 2012-13.br /
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Supporters of the \"Schools and Local Public Safety Protection Act of 2012\" say the additional revenue would help maintain current funding levels for public schools and colleges and pay for programs that benefit seniors and low-income families. It also would provide local governments with a constitutional guarantee of funding to comply with a new state law that shifts lower-level offenders from state prisons to county jails.br /
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A second tax hike headed for the November ballot is being promoted by Los Angeles civil rights attorney Molly Munger, whose initiative would raise income taxes on a sliding scale for nearly all wage-earners to help fund schools.br /
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Anti-tax groups and Republican lawmakers say both tax increases will hurt California\'s economic recovery. State GOP Chairman Tom Del Beccaro has embarked on a statewide campaign to discuss alternatives to Brown\'s tax hikes.br /
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The governor is expected to propose a contingency plan with a list of unpopular cuts that would kick in automatically if voters reject tax hikes this fall. In January, he said they would result in a K-12 school year shortened by up to three weeks, higher college tuition fees and reduced funding for courts./blockquote
Expect to hear Armageddon chants from public unions immediately if not sooner.br /
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bHow Brown Ruined California in His First Term/bbr /
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Bear in mind that Governor Brown helped ruin California with public union collective bargaining rights in his first stint as governor, in the 70\'s.br /
br /
ul
liThe a href=\"http://www.perb.ca.gov/laws/eera.asp\" target=\"_blank\"Educational Employment Relations Act/a of 1976, established collective bargaining in California\'s public schools and community colleges/li
liThe a href=\"http://www.perb.ca.gov/laws/dills.asp\" target=\"_blank\"Ralph C. Dills Act/a of 1978 established collective bargaining for state government employees/li
liThe a href=\"http://www.perb.ca.gov/laws/dills.asp\" target=\"_blank\"Higher Education Employer-Employee Relations Act/a of 1979, extended collective bargainingnbsp;to the state university system. /li
/ul
br /
California schools and taxpayers are perpetually in the hole because of Brown\'s idiocy decades ago.br /
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bFour Point Solution/bbr /
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Fixing the problem is easy to describe, but hard to implement given all the union sympathizers who want to further wreck the state.br /
br /
ol
liCalifornia needs to end collective bargaining of public unions/li
liCalifornia needs to claw back promised pension benefits/li
liCalifornia needs to end all defined benefit plans for public employees/li
liCalifornia needs to scrap prevailing wage laws that have crucified cities/li
/ol
br /
Raising taxes will just cause the exodus of more corporations and highly salaried workers as noted in a href=\"http://globaleconomicanalysis.blogspot.com/2012/03/california-tax-revenues-plunge.html\"California Tax Revenues Plunge; Businesses Exit \"Taxifornia\" in Droves; Piecing Together the Jobs-Picture Puzzle/abr /
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bTaxed to Death/bbr /
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If Brown continues to suck up to the public unions responsible for the
mess California is in, expect still more businesses to leave, expect the
unemployment rate to rise, and expect a continued plunge in revenue.br /
br /
Mike \"Mish\" Shedlockbr /
http://globaleconomicanalysis.blogspot.coma href=\"http://globaleconomicanalysis.blogspot.com/\"br /
/aa href=\"http://globaleconomicanalysis.blogspot.com/\"span style=\"color: #631616; font-weight: bold;\"Click Here To Scroll Thru My Recent Post List/span/adiv class=\"blogger-post-footer\"Mike \"Mish\" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.
Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.img width=\'1\' height=\'1\' src=\'https://blogger.googleusercontent.com/tracker/11324386-2310004552676258275?l=globaleconomicanalysis.blogspot.com\' alt=\'\' //div
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