MSNBC: Census: Number of poor may be millions higher

MSNBC: Census: Number of poor may be millions higher –  The number of poor people in the U.S. is millions higher than previously known, with 1 in 6 Americans — many of them 65 and older — struggling in poverty due to rising medical care and other costs, according to preliminary census figures released Wednesday.  At the same time, government aid programs such as tax credits and food stamps kept many people out of poverty, helping to ensure the poverty rate did not balloon even higher during the recession in 2009, President Barack Obama’s first year in office. Under a new revised census formula, overall poverty in 2009 stood at 15.7 percent, or 47.8 million people. That’s compared to the official 2009 rate of 14.3 percent, or 43.6 million, that was reported by the Census Bureau last September. Across all demographic groups, Americans 65 and older sustained the largest increases in poverty under the revised formula — nearly doubling to 16.1 percent. As a whole, working-age adults 18-64 also saw increases in poverty, as well as whites and Hispanics.
Health Care: Feel the Fraudulence – It’s worth actually reading the House Republican attack on the CBO’s health reform estimates, just to get a sense of the utter, deliberate fraudulence of the whole thing. Here’s the key picture: So, let’s look at the pieces of the adjustments that allegedly turn a deficit-reducing policy into a deficit-increasing policy.
  • 1. The doc fix: this is childish stuff, blaming the health reform for costs that will happen whether or not the reform happens.
  • 2. Alleged “double-counting” of Medicare savings; actually, there’s no double-counting involved. Savings are savings. .
  • 3. “Appropriations” — that’s administrative costs, of which the great bulk would be incurred even without the bill.
  • 4. Social Security taxes — I think they mean Medicare, but anyway, additional tax revenue does reduce the deficit, regardless of what trust fund it’s allocated to.
  • 5. CLASS Act: this will reduce the deficit over the next 10 years, but will have some long-run costs. But if you’re going to talk long run, you should do it everywhere – and health reform gets better, not worse, over time. In fact, the main reason repeal costs more than the original estimate of savings is that moving the window forward a year makes the benefits of reform bigger.

Europe unveils sweeping plans to govern reckless banks – Brussels has called for sweeping powers for regulators to seize failing EU banks, sack board members, and impose haircuts on senior bank debt, aiming to ensure that taxpayers are never again held hostage by high finance.  The European Commission’s "Framework for Bank Recovery and Resolution" draws on Scandinavia’s hard-line approach during their banking crises in the early 1990s. The goal is to end the pattern of moral hazard and mispricing of risk that generated Europe’s debt woes.  "Banks will fail in the future and must be able to do so without bringing down the whole financial system," said Michel Barnier, the internal market commissioner Mr Barnier’s consultation paper will lead to a "legislative proposal for a harmonized EU regime" as soon as this summer, with an insolvency structure in place by 2012.


Is There Enough Oil to Pay Our Debt? – Whether you’re a taxpayer in the UK, Ireland or the US, it must already be pretty clear that you’re on the hook for a lot of IOUs borrowed from your future. What’s not clear is exactly how your government is going to pay that debt back.History would suggest that the yield on a ten-year US Treasury bond should be close to double what it is, given the size of Washington’s borrowing program. The reason it’s not is that creditors and debtors both share a common belief that a powerful economic recovery lies just around the corner—one so powerful, in fact, that tax revenues will suddenly fill government coffers and let bondholders be paid the huge sums they are owed while at the same time sparing taxpayers an otherwise draconian fate. The only problem is that the economic growth everyone is counting on is powered by oil. And as you’ve probably noticed, that’s getting more and more expensive to burn. So consider just how sustainable economic growth would be in a world of oil prices of $100 to $225 per barrel. Because those are the price parameters we’d be facing in the unlikely event that we actually see the kind of economic growth that bond markets and public treasuries around the world are so desperately depending on.

TheDailyBail: SLIDESHOW: The Photos That BP Doesn’t Want You To See – Dying Birds, Corexit & Corruption

Brazil Moves To Curb Rising Currency – Brazil has made a fresh attempt to keep the lid on its rising currency with new curbs on speculative trading designed to discourage ramping of the real against the dollar.  The move is Brazil’s third since October aimed at discouraging “hot money” from chasing the real higher and so undermining the nation’s competitiveness in the face of a weak dollar.   Brazil was the first country last year to highlight the dangers of “currency wars” and Mr Mantega made it clear on Wednesday that the nation was equally alive to the problem this year. “We’re not going to allow our American friends to melt the dollar,” he said, believing that the US’s $600bn (£388bn) injection into its economy was an unfair attempt to boost exports.  Brazil will force lenders to maintain the reserve deposits in cash – on which they will not earn interest. Aldo Mendes, the central bank’s director of monetary policy, said the new curbs had the potential to trim short positions in the dollar to $10bn from last month’s $16.8bn.

Portuguese, Spanish Bonds Decline Amid Debt-Auction Speculation – The extra yield investors demand to hold Portuguese securities rather than benchmark German bunds widened to the most in a month as the IGCP debt office announced the sale of 2014 and 2020 debt, scheduled for Jan. 12. Belgian bonds tumbled after the nation’s political leaders failed to restart seven- party negotiations to form a government. German bunds rose. “The underlying story behind this slide in Portuguese government bonds is supply-related,” said David Schnautz, a fixed-income strategist at Commerzbank AG in London, who said he had heard speculation about the Portuguese sale before it was announced. “Next week we will keep on running at full steam in the primary market with supply from Spain and Italy,” he said.

Seasonal Retail Hiring: Rebound in 2010 – According to the BLS employment report – and combining October through December – retailers hired seasonal workers at well above last year, and somewhat close to the pre-crisis levels. Here is a graph of the historical net retail jobs added for October, November and December by year (not seasonally adjusted). This really shows the collapse in retail hiring in 2008 and modest rebound in 2009.  Retailers hired 646 thousand workers (NSA) net during the 2010 holiday season. This is well above the 501K hired in 2009, but still below the pre-crisis average of 720 thousand for the same three months.

Economy Needs To Create 235K Jobs A Month To Return To Pre-Depression Levels By End Of Obama Second Term – When we last ran this number, the economy needed to create 232,400 jobs per month to get to the same unemployment rate as last seen in December 2007, just before the depression started, courtesy of today’s massive disappointment we can now increase the creation requirement to 235,120. As a reminder this is the number of jobs per month that need to be created between December 2010 and November 2016, or the end of Obama’s now improbable second term, for jobs to recover their losses when taking into account the natural growth of the labor force of 90,000 people per month. Also, when ignoring the demographic shift, or just accounting for the absolute number in jobs without accounting for the labor force growth which is so wrong only the BLS looks at that number, the breakeven has been pushed back from June 2013 to July 2013. Economic collapse you can finally believe in.

Why the World Is Financially Doomed in Four Charts – Though the complexities may appear endless, the global economy’s coming implosion is really fairly easy to understand: here are four charts which do the heavy lifting. It boils down to these basics:

  • 1. When money is dear and difficult to borrow, then productivity and capital accumulation are encouraged, speculation, malinvestment and debt-based consumption are discouraged.
  • 2. When money is "free" (zero-interest rate policy) and liquidity is unlimited, then the opposite conditions hold: speculation in risk assets, malinvestment and debt-based consumption are all encouraged, and productivity and capital accumulation are heavily discouraged.
  • 3. When debts exceed the value of the underlying assets, the only way out of the Tyranny of Debt is to write off the debt on both the borrower and lender’s balance sheets, wiping out their capital via liquidation and bankruptcy.
  • 4. The "extend and pretend" policy pursued by all major nations is simply transferring the impaired debt from private hands to the taxpayers (public debt), crippling the economy with higher taxes and higher debt service.
CharlesHughSmith: No Wonder We’re Failing: Our Power Elites’ Sole Expertise Is Being Privileged The Power Elite which has been raised to occupy the privileged seats of political and financial power in America has a skillset limited to navigating the world of privilege.  The Power Elites are not monolithic: there are three distinct layers, each with its own defining characteristics.  Correspondent Judy T. recently recommended an extraordinary essay on the education and grooming received by the Political and Financial Power Elite: The Disadvantages of an Elite Education by William Deresiewicz.  In essence, Deresiewicz suggests that the Elite youth being groomed at exclusive Ivy league universities–an Elite education–are functionally incompetent in the real world and only skilled at a superficial facsimile of "independent thought" which is merely a higher order of groupthink and its attendent obedience.  I have roughly excerpted this long and important essay below.
 Republicans kill global warming committee –  The kick-off of the 112th Congress on Wednesday also marked the end of an era in the House – the demise of a committee devoted solely to climate change and energy issues. The Select Committee for Energy Independence and Global Warming, created by Nancy Pelosi in 2006, has been shuttered under the new Republican leadership. In the final days of the committee, staffers released a report on what the committee accomplished in its brief tenure – an epitaph of sorts. Tackling issues from the politicisation of climate science to the explosion of the Deepwater Horizon, the committee held 80 hearings and briefings. It played a role in shaping policy for the 2007 energy bill, the 2009 stimulus package (which included $90bn [$58bn] in energy, efficiency, and other green elements), and, of course, the 2009 climate bill (the one that never became law, of course, because the Senate didn’t act on it). The final report concludes with the question of whether the United States will respond to all the information that the committee has compiled during its lifespan on the climate and energy challenge:
Reuters: Snap analysis: The incredible, shrinking U.S. workforce (Reuters) – Even the "good" news had a dark lining in Friday’s U.S. employment report. The unemployment rate dropped to 9.4 percent in December, even though employers reported hiring a disappointingly skimpy 103,000 new workers. But the reason for the big drop from 9.8 percent in November is somewhat disconcerting. While the Labor Department’s volatile survey of households showed employment surging by 297,000, the labor force shrank by some 260,000. Even though the U.S. economy added jobs in every month in 2010, hundreds of thousands of people gave up looking for work. The number of discouraged workers climbed to 1.32 million in December, from 1.28 million the month before. In order to be counted as unemployed, people must be actively looking for work, so the rise in the ranks of discouraged workers has the somewhat perverse effect of helping to bring down the jobless rate.

TheBurningPlatform: Jobs-Spin Baby Spin – Here is the blaring headline on Marketwatch: Jobless rate falls to 9.4% Looks fantastic. Except it is more government bullshit. According to your government the number of unemployed plunged from 15 million to 14.5 million. Sounds AWESOME!!!! But wait, let’s look at the details. It seems that 434,000 Americans decided to leave the workforce in December according to the BLS. Give me a fucking break. The economy is a shambles, people are desperate for money, and 434,000 decided to sit back and take it easy? The number of people who want a job went up by 223,000, but somehow the government decides they shouldn’t be considered unemployed. Orwell is spinning wildly in his grave.  The employment to population ratio dropped again and is now the lowest since 1983.

 ZeroHedge: Gallup Finds Unemployment Increased In December, Underemployment Is At 6 Month High, Blasts Government Data Fudging –  Following this week’s ebullient ADP private payrolls report, the sellside has succumbed to an orgiastic frenzy suggesting that tomorrow NFP number may be as high as 580,000 (as reported earlier). While there is no chance on earth of that happening absent all of US data gathering to have been outsourced to Beijing, what is more interesting, is that organizations which track employment trends in real time have found that neither is ADP’s optimism justified, nor is there absolutely any basis to expect a blow out NFP number tomorrow. Gallup has found that not only did the unemployment rate increase in December from 9.4% to 9.6%, that disgruntled part-time workers who want full-time work increased from 8.6% to 9.4%, the highest since September, but that the most important metric in a labor force increasingly consisting of part-time workers, underemployment, has surged to 19%, the highest since June!  Unemployment, as measured by Gallup without seasonal adjustment, increased to 9.6% at the end of December — up from 9.3% in mid-December and 8.8% at the end of November.
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